Members of the insurance industry confirmed on Thursday that the last-minute surge that pushed Obamacare’s state-level marketplaces over eight million enrollments included significantly younger people signing up for plans. States need younger and healthier enrollees to help stabilize their marketplaces and keep premium costs down, and there’s been a lot of speculation about whether Obamacare’s private plans will be able to strike the right balance.
At a health care panel event hosted by Politico, insurers agreed that the number of Americans with health coverage has increased by millions and the people who waited until the last minute to sign up tended to be younger. “The earliest in were the sickest because they were very motivated, naturally,” Karen Ignagni, CEO of the trade group America’s Health Insurance Plans (AHIP), said.
Clare Krusing, the director of communications for AHIP, told ThinkProgress that it’s still too early to tell exactly what that means for Obamacare’s risk pools, since insurance providers are still looking at their groups of newly enrolled customers.
Still, it adds to the increasing evidence that the concerns about too many older and sicker enrollees, which could result in big premium increases, are largely overblown. Earlier this month, the statisticians working with insurers to project next year’s premium rates reported that they don’t expect double digit hikes. Outside estimates from Gallup and the Urban Institute have found that the newly insured Americans tend to be younger than the people who had insurance before Obamacare. And by the administration’s own calculations, about 28 percent of enrollees are between the ages of 18 and 34 — about the same proportion of young people who signed up during the first open enrollment period for Massachusetts’ health reform experiment, which is often the best comparison for Obamacare.
“The enrollment surge is the best news possible for insurance companies,” Larry Levitt, the senior vice president at the Kaiser Family Foundation, said earlier this month.
There are still some unanswered questions. Krusing noted that insurers are waiting to see whether allowing some Americans to keep their “transitional policies” — essentially, the administration’s policy fix for the skimpy insurance plans that were cancelled under Obamacare, which inspired a flurry of negative coverage about health reform — will affect the marketplaces. Some younger and healthier people may have opted to stay on those plans instead of joining the marketplaces, which could have a negative impact on states’ risk pools.
But insurance companies, which have a significant financial stake in Obamacare’s success, have indicated that they’re largely optimistic about the health law. Most major insurers are interested in continuing to offer their products on the new marketplaces next year.