Uninsurance Rate Falls To Five-Year Low As 3.3 Million Enroll In Obamacare

The Obama administration on Wednesday released its monthly update on health insurance enrollment under the Affordable Care Act. Nearly 3.3 million Americans enrolled in private health plans through Obamacare’s state and federal marketplaces from October through February 1, with 1.1 million signing up in January alone. The data comes on the same day that a Gallup survey found that the U.S. uninsurance rate has hit a five-year low.

“We’re seeing a healthy growth in enrollment,” said Health and Human Services (HHS) Secretary Kathleen Sebelius in a conference call with reporters. According to Sebelius, an additional 6.6 million Americans have been deemed eligible for Medicaid or the Children’s Health Insurance Plan (CHIP) during the first four months of the open enrollment period.
While it’s still unclear how many of those Americans were newly eligible for coverage in states that expanded Medicaid under Obamacare, an Avalere Health analysis estimated that between 28 and 46 percent of people who signed up for Medicaid through December were newly eligible thanks to the expansion.
In some encouraging news for the health law, 27 percent of people who picked new health plans in January are aged 18 to 34. That’s a three percentage point rise from the first three months, when less than one in four Americans who chose health plans were from that age group, and tracks with administration projections that young Americans’ enrollment in Obamacare will continue to spike as the initial six-month enrollment period comes to a close on March 31.
Past evidence from Massachusetts’s own health reform law also supports that notion. About 27 percent of people who signed up in August, a comparable point in Massachusetts’ enrollment period, were in the 18 to 34 age group.The new federal data shows that young adult enrollment spiked by 65 percent in January compared to a 53 percent increase among all other age groups.
The new Gallup survey released on Wednesday also found that the uninsurance rate among adults aged 26 to 34 has been declining faster than the uninsurance rate for the rest of the population. Less people reported being insured through their employer while more Americans said they had individual health policies or Medicaid — an indication that the fall in the uninsurance rate is being prompted by the ACA.
While some in the media have fixated on independent analyses finding that about 40 percent of Obamacare plan enrollees need to be young in order for the marketplaces to function well, health care experts say that’s not exactly the case. The Kaiser Family Foundation (KFF) has projected that even 50 percent lower-than-expected youth enrollment would raise premiums by just 2.4 percent. Rates would likely rise by an even lower rate thanks to several financial shock absorbers built into the ACA.
Furthermore, a new Commonwealth Fund report released on Wednesday concluded that age is not nearly as important as health status for the stability of Obamacare’s marketplaces.
“Actuaries and researchers both agreed that while the participation of young adults in the marketplaces is important for stability of the marketplaces and 2015 premiums, it was, and will continue to be, one of many different factors that affects premiums of marketplace plans,” wrote the report authors. “In fact, young adult participation is not even the most important factor: health plan actuaries view health status—which determines what the likely use of heath care services will be—for all age groups as being more important in their pricing decisions.”
Data on health status likely won’t be available until next year, and the health law includes several provisions meant to mitigate the effects of a costlier-than-expected risk pool.

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