(Bloomberg) — The U.S. government said it would ramp up Patient Protection and Affordable Care Act (PPACA) outreach in 25 cities to lure younger people to the program after a report showed about 70 percent of the initial customers are 35 years of age or older.
The effort by the Obama administration and allied interest groups will focus on a Feb. 15 target to sign up people for coverage beginning March 1, said White House officials, who spoke to reporters on the condition they not be identified.
The Obama administration wanted people younger than 35 to make up about 40 percent of total enrollment to help offset the cost of care for older and sicker people. Missing the target for "young invincibles" may lead insurers to adjust prices if gains aren't made by the official March 31 end of enrollment.
"It is more of a scale than a cliff," said Robert Zirkelbach, a spokesman for America's Health Insurance Plans, the industry's lobbying group in Washington. "The more young, healthy people participate, the more stable the marketplace will be and the more affordable premiums will be."
The federal- and state-run insurance exchanges, the heart of the PPACA, enrolled 2.2 million people for private health plans in the three months ended Dec. 28, the U.S. Department of Health and Human Services said in a report released yesterday. About 24 percent were 18-to 34-year-olds, and about one-third were 55 or older.
Waiting for March
Obama administration officials said there is momentum behind enrollment by young adults, as eight times as many people ages 18 to 34 signed up in December as in November and October. Website outages, software failures and other technology flaws had thwarted the attempts of at least 1 million to sign up in the first month, while others may have decided to wait until closer to the March 31 deadline.
"It takes some time, particularly for young people who are new to health care, to figure out their options," said Aaron Smith, 31, executive director of the advocacy group Young Invincibles, which is helping enroll people in Virginia, Arkansas, New York and Washington, D.C. "It's kind of logical that people who are sick would be more likely to sign up right at the beginning."
The $1.4 trillion law requires most Americans to obtain health insurance by April or pay a penalty of as much as 1 percent of their income. The patient-mix is important to insurers who would have to decide by the end of May whether they want to keep selling exchange plans in 2015.
Insurers' options
Insurance premiums may rise next year if more young adults don't sign up. That could provide an opening for Republicans in Congress who have attempted to repeal or dismantle the health law more than 40 times since its passage in 2010.
"Youth enrollment has been a bust so far," Brendan Buck, a spokesman for Republican House Speaker John Boehner of Ohio, said in an email. "When they see that Obamacare offers high costs for limited access to doctors — if the enrollment goes through at all – it's no surprise that young people aren't rushing to sign up."
Humana Inc. said last week it was evaluating its expectations for the law's effect after the initial wave of customers appeared to be sicker and costlier than anticipated.
"We're confident based on the results we have that we'll have an appropriate mix enrolled in coverage," Mike Hash, the director of HHS's Office of Health Reform, said yesterday on a conference call. Young adults should enroll in greater numbers as the March 31 deadline approaches, he said.
The law allows those younger than 26 to remain on their parents' health plan. About 3 million young adults have taken that option, Kathleen Sebelius, the HHS secretary, said.
Self correcting
Congressional analysts had projected the government-run insurance markets would attract about 7 million people in the initial six-month enrollment period. To keep the system financially stable, the White House had said it needs about 2.7 million of the new enrollees to be young, healthy customers.
