Death spiral warning still in effect.
It turns out that the Republicans on the House Energy and Commerce Committee were wrong when they claimed that 33% of the eight million Americans enrolled for Obamacare health care exchanges have not yet paid their premiums. A more accurate number, according to the Associated Press based on testimony of three major insurers, is 20%.
Well, that changes everything, doesn’t it? Only 20%? That’s a mere 1.6 million people. A drop in the bucket. Obamacare remains a success.
I expect you noted my sarcasm in that last statement. This story is a mixed bag. Republicans do deserve criticism for rushing out flawed numbers that failed to take into account a surge in last-minute enrollments after the House committee surveyed insurance companies around the country. They failed to qualify the tentative nature of their numbers, thus creating an inaccurate impression.
Politically, the move was stupid, too. Democrats quickly made Republican sloppiness with numbers the story. (Read the comments in “What If They Gave a Health Care Plan and Nobody Paid?“) Thus the Republican screw-up became the story, not the fact that 20% of enrollees hadn’t paid their premiums. In the daily spin cycle, Dems now can tout the number as a moral victory for Obamacare.
But the fact remains: Any number approaching 20% non-payment is very bad news. No one anticipated a figure so high. True, it’s less disastrous than 33% but it’s still high enough to send the state exchanges into death spirals, especially when you consider that those not paying are statistically more likely to be the coveted young invincibles who will keep rates low. The main point of my previous post — that the non-payment problem should have been foreseeable, given the large number of Americans who are unbanked or underbanked — holds true.
— JAB
