President Obama hasn’t been able to convince young Americans to sign up for insurance coverage through his health reform law’s exchanges. So he’s enlisting the help of two new groups he hopes young adults won’t ignore kittens and celebrities.
Enroll America, a nonprofit aligned with the Obama administration and led by many of its alumni, just launched a multimillion-dollar ad campaign featuring cats, dogs and birds saying things like: “If you really love me like you say, get yourself health insurance today.”
The likes of Magic Johnson and Will Ferrell, meanwhile, have filmed videos for the White House touting ObamaCare.
The administration will need more than talking pets and A-list testimonials to get the sign-ups it needs. With less than six weeks until the enrollment period ends, it’s likely the exchanges won’t reach the targets the administration has set. If that happens, we can expect higher premiums.
Official data from the Department of Health and Human Services show that in the first three months, just 24% of those who signed up were 18 to 34. More than half were 45 to 65.
In January, the administration declared those numbers were improving. Team Obama counted 1.14 million sign-ups in the first month of 2014 more than the 1.05 million it projected. But that’s still 29% below December’s figures.
Overall, the administration is behind its initial enrollment projections by 1.1 million.
The total share accounted for by young people has only budged to 27%. That’s well below the 40% target the Obama administration set for young-adult enrollment.
Plus, most of those signing up in the exchanges already had insurance. ObamaCare has largely failed to make inroads among the uninsured, where the young and healthy are overly represented. A McKinsey study found that just 11% of enrollees came from the ranks of the uninsured in the first three months.
ObamaCare’s youth enrollment problem could actually be worse than the numbers suggest, since the administration’s count includes anyone who has selected a plan in an exchange, not those who actually paid for it.
Insurers estimate that one in five of those who signed up in 2013 didn’t pay their first premium on time despite repeated delays in the due date. Washington state has been tracking payment rates and found that just 50% of enrollees have actually paid.
Further, the national averages reported by the states may obscure significant problems in the states. After all, insurance isn’t sold on a national market it’s sold in individual states. Each one must have a functioning marketplace, which means they all need to attract sufficient numbers of young people.
In at least 10 states, the share of young enrollees in the first three months was 20% or less. In West Virginia and Arizona, the share was a mere 17%.
The White House says not to worry. It fully expected the young to buy insurance at the last minute. Just stay tuned, and the “young invincibles” will pile into the exchanges before the March enrollment deadline. But the very structure of ObamaCare discourages the young from enrolling.
ObamaCare caps premiums for the old at no more than three times what the young pay. But that cap doesn’t mean that insurers will hold premiums for the young where they’ve been and slash premiums for the old.
Instead, in order to avoid losses, insurers must raise premiums on the young to subsidize artificially cheap coverage for the old.
The law’s tax subsidies are supposed to relieve some of the sticker shock. But they still won’t make policies cheap enough to attract as many young adults as needed. And the penalties, which are meant to prod recalcitrants into buying coverage, will be as little as $95 this year far too low to make much of a difference.
The Obama administration counts 3.3 million enrollees in the exchanges thus far. When the marketplaces opened in October, the White House said it’d have 7 million sign-ups by the end of March.
To meet that goal, Team Obama must more than double the sign-ups it’s had in the previous four months over the next six weeks. Those cat ads better be good.