Businesses are dumping far fewer of their employees into Obamacare’s exchanges than analysts initially had predicted, according to a new analysis released last week that suggests the massive health law has not been the economic spoilsport critics had feared.
While congressional budget scorekeepers had projected that 21 million people should be using the Affordable Care Act’s exchanges at this point, only about 13 million have actually signed up.
And the Kaiser Family Foundation, a nonpartisan health think tank, says that number will top out at just 14.7 million paying customers in the next few years.
There are a number of reasons why the numbers are lower, but Kaiser said one factor is that employers haven’t dropped the 6 million workers that the Congressional Budget Office had predicted would be cut off their job coverage by now.
“The economy has been growing and employment has been growing, so most employers still are offering coverage to their employees,” said Timothy Jost, a law professor at Washington and Lee University in Virginia who closely tracks the implementation of health care reform. “It’s heavily tax-subsidized, and employees still expect it.”
The White House also has taken notice.
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“In fact our businesses have created jobs every single month since I signed that ’job killing’ Obamacare bill,” President Obama said Friday at a meeting with his economic team.
Kaiser theorized that incentives for employers to keep offering health benefits “are more powerful than expected, at least so far.” Obamacare requires employers with 50 or more workers to provide affordable health coverage or pay fines — an “employer mandate” that was twice delayed, but will be fully implemented this year.
Obamacare critics say the lower number of people enrolled in the exchanges is a sign of sickness in the Affordable Care Act.
Congressional Republicans say premiums are going up in many places — not down — while out-of-pocket costs tied to some offerings leave enrollees “functionally uninsured.”
And critics say the Obama administration has managed to artificially tamp down on losses from employer-based coverage by letting employers keep substandard plans.
Mr. Obama is hoping to cement the health law’s gains this year, before he has to turn the reins over to a successor, and is trying to build interest in the exchanges.
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Insurers want more people to sign up for the exchanges to spread out the risk, fearing they’ve exposed themselves financially because too many sicker customers snapped up plans early on.
Kaiser said if every state attracted the same level of interest in the exchanges as the 10 best-performing states, than enrollment could reach 16.3 million.
The analysis, released Friday, assumes that about 10 percent wouldn’t pay their premiums, so actual enrollment should land just below 15 million over the next several years.
One year ago, the CBO forecasted 24 million enrollees for both 2017 and 2018.
“Judging by the experience of the top performing states, there is considerable room for enrollment growth over the next several years,” the Kaiser analysis said. “However, even if all states signed people up at the rate of the top 10 states, enrollment would still fall well short of projections by CBO, suggesting that those forecasts may have been unrealistic.”
Kaiser said enrollment has been tamped down by an array of factors, beyond the miscalculation about employers.
Some people think plans on the exchanges are still too expensive, while people who made too much money to get subsidized bought plans off the exchange, even though those plans have to comply with Obamacare’s rules, too.
Meanwhile, the White House also let people renew their bare-bones plans through late 2017, after millions of people complained that Obamacare kicked them off non-compliant coverage, despite assurances that “if you like your health plan, you can keep it.”
• Tom Howell Jr. can be reached at thowell@washingtontimes.com.
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