About 8.3 million Americans had signed up for insurance through the federal exchanges by mid-December, almost two million more than by the same time a year before. The figure was seen as good news for hospitals and insurers. The U.S. had set a low bar for the enrollment season that opened Nov. 1, aiming to get about 10 million people paying for coverage by the end of 2016. Premiums on the exchanges are going up more for 2016 coverage than they did in 2015, when a survey found premiums for policies sold through exchanges falling for silver-tier plans and rising slightly for bronze. One worrisome sign came when UnitedHealth, the country’s biggest insurer, said it might pull out of the exchanges in 2017, saying it was losing money on the policies it had sold. Earlier in the year, the exchanges survived a legal challenge, when the Supreme Court by a vote of 6-3 upheld the provisions of the ACA that allowed subsidies to be given to people who bought insurance through the exchange established by the federal government, HealthCare.gov, as well as state-created exchanges.
The exchanges were just one part of the law’s approach to bring coverage to as many as 50 million Americans who lacked it, but they are its main tool for reaching those not covered by their employer or a government program. The idea behind the exchanges was simple: bringing together the millions of people relying on individual policies would lead to larger risk pools, more competition and lower premiums. That depends on enrolling enough healthy people to offset the cost of sicker customers — otherwise costs could rise, especially for young adults. Congress expected each state to create and manage its own exchange, but only 14 (plus Washington, D.C.) initially agreed to do so. The rest, reflecting hostility to Obamacare or concerns about the technical hurdles, opted to let Washington do all or part of the job, a point that became more important when the challenge to the subsidies headed toward the Supreme Court. Hawaii set up its own exchange but abandoned it in favor of the federal site.
Despite the gains in coverage, polls showed that the health-care reform law continued to be unpopular — although a large majority continued to oppose repealing it. The strong Republican midterm victories in 2014 revived momentum for another attempt to repeal the law or, more realistically, chip away at some of its less popular provisions. But with President Barack Obama threatening to veto any significant change, conservatives had pinned much of their hopes on the Supreme Court case. The future of the health exchanges in particular look they will depend more on the economics of the new market they have created, and whether enough insurance companies will continue to participate for the exchanges to offer consumers robust competition.
The Reference Shelf
- A Bloomberg Visual Data chart tracks state-by-state enrollment in Obamacare.
- Read the Affordable Care Act here. The section on exchanges begins on page 55.
- The U.S. government has a calendar of key dates while the Kaiser Family Foundation is tracking state progress.
- A compilation of new health law regulations published by the Health and Human Services Department.
- A book by the former Obama adviser David Blumenthal covers the contentious history of health reform in “The Heart of Power.”
- PriceWaterhouseCoopers reports on how the insurance industry is affected by the exchanges.
- Bloomberg Visual Data has a chart with a state-by-state rundown of premiums.
- Bloomberg News “Prognosis for Obamacare” coverage index.
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