We’ve seen a lot of news stories trumpeting “enrollment” numbers from HHS with very little context to understand how many people have actually paid their premiums and how many have simply “selected a plan” in a shopping cart, which HHS refers to as “pre-effectuated enrollment.”
We’ve also seen very little analysis of how much federal taxpayers have been forced to pay to build and market the new Obamacare exchanges. Those costs have now totaled $6.9 billion ($4.9 billion in grants to states and $2 billion for the federal Healthcare.gov). And that’s not including an additional $1.4 billion HHS anticipates spending on Healthcare.gov in fiscal 2014.
Some of the states are performing absolutely miserably on a cost basis, such as Hawaii, which has spent over $44,000 of federal taxpayer money per “person who selected a plan,” the District of Columbia, which has spent over $27,000 of federal taxpayer money per paid enrollee. All of the state exchanges are more costly to taxpayers than the much-maligned federal healthcare.gov.
The chart below was compiled from three sources: total federal grants to state exchanges based on CMS data compiled by Americans for Tax Reform, the latest HHS enrollment report, and a compilation of payment rate data from state exchanges compiled by CNBC. Where the state-reported “selected a plan” number reported by CNBC differed from the HHS report, the former was used.
Obamacare Exchanges: Federal Grant Costs Per “Pre-Effectuated” and Paid Enrollee
Exchange grants from federal taxpayers
“Number of Individuals Who Have Selected a Marketplace Plan”
Exchange cost per “Individual Who Selected a Marketplace Plan”
Reported Paid Rate
Estimated Paid Enrollment
Estimated Exchange cost per Paid Enrollee
Hawaii
$205,342,270
4,661
$44,055
Washington, D.C.
$133,573,928
6,516
$20,499
75%
4,887
$27,333
Vermont
$208,232,414
24,326
$8,560
59%
14,342
$14,519
Massachusetts*
$179,036,455
12,965
$13,809
Oregon
$305,206,587
38,806
$7,865
Rhode Island
$134,719,994
19,690
$6,842
83%
16,345
$8,242
Kentucky
$253,698,351
54,945
$4,617
Minnesota
$155,020,465
33,722
$4,597
90%
30,350
$5,108
Maryland
$171,013,111
38,070
$4,492
54%
20,558
$8,319
Connecticut
$184,096,903
57,465
$3,204
92%
52,868
$3,482
Nevada
$83,775,083
30,015
$2,791
70%
21,011
$3,987
Colorado
$178,683,411
83,469
$2,141
New York
$429,065,407
244,618
$1,754
California
$910,605,370
923,832
$986
85%
785,257
$1,160
Washington
$181,392,299
191,081
$949
57%
108,916
$1,665
Healthcare.gov†
$2,001,616,000
2,621,086
$764
*Massachusetts only reports paid enrollment.†Federal Exchange actual obligations for FY 2010, FY 2011, FY 2012, and FY 2013 (as of 12/31/2013)
The average of the nine states reporting payment information is 74 percent. The cumulative payment rate across those nine states is just under 80 percent, which is in-line with national estimates from insurance companies.
Until better data is reported by the federal exchange, it is reasonable to reduce the official reported numbers by 20 percent to estimate paid enrollment — and it is necessary to do so to track progress toward the original goal of seven million enrollees, which was a target for paid enrollment, not “pre-effectuated” or shopping cart enrollment.