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Ellison's Must Read of the Day

Ellison must read
October 16, 2014

My must read of the day is "If You Like Your Insurance, Can You Keep It This Time Around?" in the Atlantic:

People who already bought health insurance through Obamacare will likely face another round of confusing technical issues as they try to re-enroll for a second year. […]

Insurers aren't necessarily worried about problems as dramatic as last year's HealthCare.gov failure, but rather what one industry official called "a soup of kind of icky things" that could make life difficult for returning enrollees.

Some of the technical problems stem from the difficult balance between keeping people enrolled and encouraging them to shop for a better deal. Due to complicated behind-the-scenes changes in the way the law's tax credits are calculated, people who automatically renew their policies without taking another pass through the enrollment system are at risk for particularly large and often surprising cost increases. […]

None of these are fatal problems. Insurers managed to sign up nearly 8 million people largely by hand during the first open-enrollment period, and these technical challenges pale in comparison to last year's.

Enrollment in the Obamacare exchanges this time around won’t be as bad as last time (kind of a low bar), but it still won’t be great.

One of the most concerning technical issues was reported in National Journal in early August—the article was aptly titled, "If You Like Your Obamacare Plan, It'll Cost You."

The problem in this instance is that the system to automatically recalculate subsidies hasn’t been set up. That means if you’re reenrolling and don’t go back to recalculate your subsidy then you may be paying a higher premium than you thought, because the "base plan" that is used to calculate subsidies for all plans is the silver plan—and that is not a standardized plan. The silver plan is selected based on cost, and it is going to be selected for the category depending on the price of plans in your area, and prices often change.

Basically, people could be paying more for something when they weren’t expecting to, and that doesn’t make for happy customers.

All of these potential glitches are probably not "fatal" problems, as the Atlantic notes. They are not things that will destroy the exchanges or Obamacare as a whole, but they are things that have the potential to be politically fatal.

But they won’t be because enrollment this year does not begin until after Election Day.

The administration moved the enrollment date back a month in November last year. Instead of beginning on Oct. 15 and ending the first week of December, enrollment for 2015 begins Nov. 15 and ends in the middle of January.

They argued that it was done so insurers would have more time to evaluate the market and set accurate premiums, but Republicans have always said it was a political decision.

Problems such as technical glitches, which healthcare officials know will be frustrating at best, leave little doubt that moving the enrollment date is politically beneficial to Democrats. Red state Democrats have little to thank the president for this election cycle, but one thing they should probably thank him for is moving that enrollment date. This piece in the Atlantic is evidence of that.

Published under: 2014 Election , Obamacare