Affordable Care Act predictions missed the mark

CBO predictions about how many people would buy health insurance plans through the ACA exchanges have so far missed the mark by about half--a big part of the reason insurers say they can't turn a profit on the plans and are withdrawing from some markets as a result.

In February 2013, the Congressional Budget Office (CBO) predicted that 24 million people would buy health coverage through the federal and state exchanges by this year. Just 11.1 million people were signed up as of late March.

In a piece published over the weekend, the Washington Post takes a look at the numbers, recalls some of the statements made when healthcare reform was new and outlines some of the reasons for the gap.

The fact is, a lot has changed since 2009, when Obama said that signing up for exchange plans would be as easy as buying a plane ticket, and since 2013, when the CBO predicted roughly 13 percent of the population would have done so by now.

For starters, predictions that large numbers of employers would send their employees to exchange plans missed the mark. Plus, the penalties for failing to obtain health insurance aren’t exactly onerous when compared to the cost of exchange plan premiums and deductibles--even with subsidies, the article notes.

That penalty was “no stick at all,” Joseph Antos, a resident fellow at the American Enterprise Institute, told the Post.

“This is the classic case of where Johnny marked crayon on the wall, his mother said, ‘Don’t do that,’ and then slapped his hand a day later ... The connection between the offense and the penalty is a little remote.”

The fact that consumers are still getting plans through their employers isn’t a bad thing on its own. But it has limited payers’ ability to offer a robust menu of exchange plans and, in some cases, prompted their exit from some exchanges altogether.

Aetna, UnitedHealth and Scott & White have all announced substantial reductions in their ACA exchange offerings. Last week, Oscar Insurance Corp., the health insurer branded as a tech firm that would turn the industry on its head, left ACA markets in Dallas and New Jersey.

“The individual market isn’t working as intended and there are weaknesses in the way it's been set up,” CEO Mario Schlosser said.