This month, Health Secretary Kathleen Sebelius trudged up to Capitol Hill for her second public grilling over the flaws with the Obamacare healthcare exchanges. Sebelius was insistent that HealthCare.gov has vastly improved since its October launch, noting that about a quarter of a million new people signed up in November.
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That brings total site enrollment to about 365,000. That’s nowhere near the White House’s initial enrollment projection for 2014 of 7 million. But the administration would have you believe it represents a profound step-up from the glitch-plagued weeks of the initial rollout.
But these sign-up numbers are deceiving. Don’t let them fool you. Just because someone has successfully submitted an application through an exchange doesn’t actually mean he or she will have health coverage come January. The exchange network is still so opaque and plagued by operational flaws that many applicants are likely to get their plans covertly cancelled.
The biggest problem is that public officials have largely left enrollees in the dark about an important quirk of exchange plans: users have to pay their first month’s premium before coverage kicks in. Simply submitting the forms isn’t enough.
The first round of exchange plans are set to go into effect January 1st. Federal officials had instructed participating insurers to void any plans that hadn’t received first month’s payment by New Year’s Eve. However, in a panicked move to boost enrollment numbers, the administration successfully lobbied the Association of Health Insurance Plans to urge its member companies to give consumers until January 10 to pay their first premium.
The government has refused to release comprehensive statistics on initial premium payments. But there’s good reason to believe that the bulk of exchange enrollees haven’t made one yet. Indeed, a major exchange insurer, the Physicians Health Plan of Northern Indiana, recently reported that it had received activating premiums for just 20 percent of its new applicants.
Many enrollees don’t know they have to make that first payment. Once 2014 rolls around, their plan will get cancelled, likely without them knowing it.
As Eileen Smith, spokeswoman for the Minnesota Council of Health Plans, has explained, “We’re going to have people who think they’ve enrolled when they haven’t.” Another anonymous insurance industry executive echoed that sentiment to CNN, saying that “people may show up on the doorstep of the doctor or [their] hospital thinking they have coverage and they don’t.”
And this isn’t the only problem obscured by Secretary Sebelius’s “progress” report to Congress. While the White House has indeed fixed many of the user-facing exchange glitches, there are still substantial back-end technical problems once the applications are submitted.
Even Henry Chao, the deputy chief information officer for the Centers for Medicare and Medicaid Services, has openly admitted that fully 30 percent of marketplace infrastructure is still under construction.
As a result, insurers are facing a flood of “834 errors,” named after the official electronic file sent by exchanges to providers once users pick a plan. The 834 form is supposed to contain all vital applicant data, including name, address, contact information, and social security number. Insurers use this file to establish consumer billing schedules and formally enroll them in a coverage plan.
Problem is, many of the 834 forms generated by the exchanges have incomplete, inaccurate, or duplicative information. Or, the files go missing entirely.
Major insurers in Washington, Kentucky, and New York have reported needing to correct faulty data in thousands of 834s. Robert Laszewski, an industry consultant based in Virginia, says that about 10 percent of the forms received by a local carrier have serious flaws.
Tony Felts, a spokesman for Anthem Blue Cross and Blue Shield, has a particularly politic way of describing the situation: “As far as the quality of the data that’s coming in, I can’t say that everything has been completely accurate.”
Truth be told, the government is hard at work fixing this mounting mass of 834 errors — by hand. Literally. During her congressional testimony, Secretary Sebelius said — proudly and publicly — that “we are in the process of actually hand-matching individuals to insurance companies.”
Yes. You read that right. In an age of iPhones, self-driving cars, and interstellar space exploration, that’s the sophisticated problem-solving tool now deployed by public healthcare bureaucrats.
Come January 1, millions of exchange enrollees are likely in for a rude awakening. They thought they’d signed up for coverage. But government incompetence led to that plan getting cancelled. And they’re still uninsured. This is life under the liberal lunacy of Obamacare.
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