Starting Tuesday, uninsured people can buy subsidized policies in government-operated marketplaces designed to overcome high prices, exceptions for pre-existing illness, benefit caps and other decades-old obstacles that dominated the individual insurance market.
The online marketplaces, also known as exchanges, sell plans effective as soon as Jan. 1. But they got a rocky launch, with software glitches in some cases and implementation delays in others.
“Today’s launch begins a new day when health-care coverage will be more accessible and affordable than ever before,” said Kathleen Sebelius, secretary of the Department of Health and Human Services.
But even President Barack Obama acknowledged that the technology required to link complex online exchanges with insurance companies, tax authorities and other government agencies would work far from perfectly at first.
“In the first week, first month, first three months, I would suspect that there will be glitches,” Obama said in an interview with NPR. “This is 50 states, a lot of people signing up for something, and there are going to be problems.”
Obama pointed to Massachusetts, which launched its own insurance portal in 2007, where he said “it took several months before everything was smoothed out.”
Visitors to the federal insurance portal, healthcare.gov, were greeted by delays, and several states have reported hiccups. Maryland’s exchange crashed early Tuesday morning. Minnesota said its site wouldn’t operate until Tuesday afternoon.
Vermont said it would not be ready to accept online premium payments until November, and Washington, D.C., enrollees won’t learn immediately about their subsidy eligibility. But there is also concern that the government shutdown, which will furlough more than half of the HHS staff, will impede timely solutions and deter the uninsured from signing up.
Having shut down the government over Democrats’ refusal to delay or shrink the health law, Republicans portrayed the technical problems as part of a long line of delays and complications in its implementation.
“This law is not ready for prime time,” House Speaker John Boehner said Monday. “The American people are worried about their job, they’re worried about their incomes rising, because they’re all under pressure. The economy's not growing. Why isn't it growing? One of the issues that’s standing in the way is Obamacare.”
The insurance industry portrayed itself as a partner in the law’s goals of expanding coverage and controlling costs.
“In addition to helping consumers find the coverage that best meets their needs, health plans are working to keep coverage as affordable as possible by ensuring patients can choose high-quality, cost-effective providers, coordinating care for those with chronic illnesses, and partnering with hospitals and physicians to reward high-quality care,” Karen Ignagni, CEO of trade group America’s Health Insurance Plans, said Tuesday morning.
The law being implemented today is not the same legislation Obama signed in 2010. In response to legal challenges, last year the Supreme Court allowed states to opt out of the ACA’s expansion of the Medicaid program for low-income consumers. As a result only about half the states are expanding Medicaid.
Even so, the Congressional Budget Office expects 14 million Americans to gain coverage in the first year, mainly through the exchanges or Medicaid. Roughly 48 million Americans are uninsured, according to the Census Bureau.
For many, the online marketplaces, also known as exchanges, promise access to doctors and medicines that might seem out of reach despite their location in one of the richest nations in the world. Starting Jan. 1, most Americans are required to have health coverage or pay a penalty that starts at $95 or 1 percent of income and rises to $695 or 2.5 percent of income.
“I’ve been without insurance for several months now because I haven’t been able to afford it,” said Zannah Merrill, 28, a recently unemployed Virginian who is dealing with chronic illness. “I’m excited about the health-care exchange because once I get a job or once I’m back in school and I have loans that will cover my expenses, that will make life so much easier.”
But for others the law means higher taxes, more expensive policies or paying a penalty for lacking insurance. Covering the sick and charging them less under the health act requires making the well sign up and in some cases charging them more.
“Just because people sign up for October or November they may not understand the plan they select,” said Joseph Antos, a health economist at the American Enterprise Institute. “Reality will strike them when they pay the premium. By then plans will have seen disenrollment — either because they didn’t pay the bill or because they actively didn’t want to.”
Meanwhile, many employers are amending their health benefits, which some see as a side effect of the health law and others see as part of a routine effort by corporate America to control health costs. But often the moves raise doubts about the health overhaul.
“Let’s face it, folks have been told all along if you like your coverage you can keep it,” said Edward F. Howard, executive vice president of the bipartisan Alliance for Health Reform. “If your employer does not like your coverage, you’re not going to keep it, and that’s going to be off-putting for lots of folks.”
While the administration has boasted that premiums sold through the marketplaces in many cases have turned out to be lower than expected, others have noted that exchanges are revealing that networks for the least expensive plans may exclude many popular hospitals and doctors.
“It’s going to be something we have to watch,” said John Holahan of the Urban Institute’s Health Policy Center. Many plans sold on the exchanges, he said, “are probably not going to have the very best, most expensive, hard-to-get hospitals and doctors in those networks.”
For all their sweep, the marketplaces have no impact on millions insured by employers, seniors covered by Medicare and some others with existing policies. Their chief effect is on the market for individuals, families and small employers buying commercial insurance plans.
Independent analysts said it will take months or years to determine whether the exchanges are succeeding. Consumers have until March 31 to sign up for coverage. Many compared today’s openings to an unannounced “soft opening” at a restaurant still training the waiters.
“The outcome for the first year is going to depend on what happens over the next many months,” said Paul Ginsburg, president of the Center for Studying Health System Change. “This is a multi-year process.”
This article originally appeared on Kaiser Health News.