Donald Trump wants Obamacare to implode. That’s not a mischievous inference from his legislative misadventures; that’s a direct quote. “As I said from the beginning, let ObamaCare implode, then deal. Watch!”
It’s thus somewhat surprising that on his watch, enrollment currently seems to be on track for its best year ever. In the first four days, 601,462 people signed up for insurance through the federal marketplace, a significantly faster pace than in earlier years. And almost a quarter of them were new to the exchanges.
This is probably not what you expected. It’s not what I expected. Premiums are rising, insurers are pulling out, and the administration seems somewhat uninterested in encouraging people to enroll, having shortened the open enrollment period and defunded the cost-sharing subsidies for low-income enrollees.
Nonetheless, open enrollment seems to be going swimmingly. So let me attempt to answer the question that is probably at the forefront of your mind: “What the hey?”
Four days of data, however fascinating, are not quite enough to draw definitive conclusions. But I can outline some factors that could be contributing to this unexpected spike in enrollment, and what that suggests for the future of the troubled program.
The first possibility is that the very failures in the exchange are, perversely, making it more attractive. Hear me out.
In short, the premium increases have fallen especially heavily on the “benchmark” plans, which are the second-lowest-cost Silver plan available on a given exchange. Premiums for Bronze, Gold and Platinum plans have also gone up, but not so much. But because the premium subsidies are calculated based on that benchmark plan, this has the odd side-effect of making the other plans more attractive, at least to folks who are eligible for a subsidy. For many of the subsidy-eligible, the cost of a Gold plan, which covers 80% of expected health care expenses, may actually be cheaper this year than it was last year, not because the cost of the plan fell, but because the subsidies rose so much. And many young and healthy people will be able to get a Bronze plan, which covers 60% of “actuarial value,” for practically peanuts.