Obamacare Exchange Debut to Horrid Reviews
When we anticipated, the launch of the Health Insurance Exchange / Marketplace (as referred to by the CMS and Department of HHS) we knew there would be several bugs and glitches. Going into the launch there were so many unresolved issues it was eminent the site would not have a smooth launch, however no one knew what to expect. Well it’s been two weeks since the site launched, and we have some preliminary results and consumer feedback. Unfortunately for the Obama administration its not very good.
Obamacare Exchange Debut The Good:
- Call it curiosity or call it genuine interest, but within the first two weeks an AP-Poll estimated seven percent of American have reported someone in their household has attempted to sign up or purchase insurance through the health care marketplace. Why is that good? Overall the Congressional Budget Office COB has estimated the number of uninsured to be in the range of 48-50 million Americans. Seven percent of Americans can represent more than 20 million Americans, which equates to 40% of the individuals the Health Insurance Exchange is setup to help.
- The prices for a majority of individual are much cheaper than current plans they may be on. We do not dispute that there are some individuals who are seeing higher prices, but for the majority of the individuals who have gone on the exchange this week the premium prices are much lower than the plans they are on.
- Open enrollment is six months long. If we look at past history of other large government programs, the roll out is never great, and since enrollment is six month long and users have till December 15, 2013 to sign up for plans that will begin on January 1, 2014 there is still plenty of time for the HHS to fix the bugs on the website which they have begun already, and for folks to sign up for January 1, 2014 plans.
- Many Americans were too distracted with the Government Shut Down to be fully aware of the challenges that were occurring with the launch of the Health Insurance Exchange. There was such a focus on shutting the government the headline focused less on the challenges with the exchange and more with the shutdown, giving the CMS some unforeseen reprieve with the challenges facing the launch of the Marketplace.
- There are other options besides the online website. CMS and department of HHS partnered with Serco, the contracting firm that recently won a $1.2 billion health law contract to process the paper applications. Download Health Insurance/Obamacare Marketplace Application
Obamacare Exchange Debut The Bad:
- The website has been plague by bad coding and technical glitches. 75% of the 20 million or three-fourths of those who tried to sign up reported problems. This has been reflected in the underwhelming reviews. The glitches have ranged from overloaded severs, poor security questions, and a lot of poor coding that resulted in unusually high load on the servers causing constant crashing. Once an account is created there are various agencies that have to share information, including the IRS, DOL, etc. As previously reported many of the SLA with these agencies was not completed till days before the exchange was set to open. While these bugs could have been avoided, based on the poor implementation timeline there were unavoidable.
- The website cost an estimated 400 Million dollars to setup, with the level of issues that are present, and bad coding, Several experts are now that it will cost and additional 237 Million dollars totaling $637 Million dollars.
Obamacare Exchange Debut The Ugly:
- In the court of public opinion the roll out and launch of the Health Insurance Market place was a complete flop. Just 7% of the individuals that were surveyed said the launch had gone well, or somewhat well. The state running their own exchanges faced similar challenges. As a result of these glitches many individuals were not able to sign up.
- The Administration is not releasing any numbers and has declined to release enrollment statistics, saying that will be done monthly. With an estimated 20 million people going on the site to try to sign up, there should be very positive numbers based on the level of interest. However with the inability to actually sign up we are afraid many individuals that wanted to use the system failed to actually sign up. Additionally, having such a bad user experience will turn off some individuals from going back to the site in the near future.
- Premiums are not deductibles. While many are seeing lower prices for monthly premiums there is two sides to the story, there are annual deductibles that have to be viewed as well. Some families are seeing deductibles as high as 12,700. According to the Chicago Tribune a single dad with a seven-year-old daughter would have to paid 5 times what he is currently paying for their out of pocket expense.
- More individuals will continue to stay on the sidelines, the department of CMS, and HHS need as many individual to sign on to the exchange to help and make it work, and keep prices on track. However the group of individuals waiting on the sideline until the bugs are worked out will increase, this will make it much more difficult for companies to calculate the success of the sign up and roll-out.