Unlocking the mystery of Obamacare demographics
Even as she proudly announced Tuesday that more than 2.1 million people enrolled in Obamacare insurance by the end of 2013, Health and Human Services Secretary Kathleen Sebelius and her spokeswomen were conspicuously mum on just who those people are—a fact that could push plan prices higher next year.
The demographic profile of Obamacare enrollees nationally—in particular the sizes of various age groups and gender distribution—still has not been revealed after the first three months of open enrollment.
Julie Bataille, a spokeswoman for the Centers for Medicare & Medicaid Services, during Sebelius' conference call with reporters Tuesday declined to comment on the details of what demographic data federal officials had, or when they would release such data.
"When we have more granular information and data, we will certainly share that with you," said Bataille, whose agency runs HealthCare.gov, the federal Obamacare exchange that sells insurance in 36 states. CMS also collects enrollment data from the other 15 exchanges being run by individual states and the District of Columbia.
In contrast, California's Obamacare exchange has been releasing detailed demographic data along with its enrollment numbers, as have several other states.
"It's all part of our policy and our position of transparency," said Larry Hicks, spokesman for the Covered California exchange. "I think spreading the word about our efforts to enroll and the progress we're making is ultimately beneficial to the goal of enrolling Californians."
In contrast, the reluctance—or inability—of federal officials to disclose total national demographic data has led to speculation that the "mix" of enrollees to date is disproportionately weighted toward older people, who on average use health insurance benefits more often than younger people. If that is the case—and if it remains so—insurers, when they price plans for 2015, might have to bump up premiums significantly to account for the disparity.
Targeting the gaps
"I can't tell if they just don't have the capacity to get the data correct, or ... if they're hiding it because the numbers are bad," said Jonathan Wu, chief analyst of the consumer price comparison website ValuePenguin.com, referring to federal officials.
"It would be much more informative to everyone if you knew what was going on. ... It's sort of troubling that it's not being done."
Wu said it is possible the federal officials in recent months were so busy trying to fix the slew of software problems that plagued HealthCare.gov after its rollout that they have not yet focused on parsing demographic data.
But, he noted: "It's definitely in their database, and any single competent database analyst would be able to get it out. That's the kind of thing they should be able to do."
Wu said that knowing the current demographic mix could help Obamacare advocates better target certain groups of people in various states to get them to sign up and improve the mix.
"The problem of not having the data, you just don't know who to address," he said.
California's enrollment data has exposed the fact that younger adults, so far, have enrolled at a significantly lower rate than their share of the overall state population, according to most recently available numbers. And the state's exchange also was lagging in signing up Hispanics, who are a sizable minority of residents there.
Joanne Peters, spokeswoman for the Health and Human Services Department, when asked why HHS has not released national demographic data yet, told CNBC.com: "We have prioritized reporting of the metrics which provide the most accurate snapshot of marketplace enrollment-related activity at this time. We will provide additional metrics when we are able to."
Timothy Jost, a professor who specializes in health law at Washington and Lee University School of Law, said of federal officials, "I wish they were more forthcoming" with demographic data.
But, Jost said, he expects that there is "such a 'gotcha' game" going on around Obamacare that federal officials may feel reluctant to release such data knowing that it might generate further negative headlines about the already controversial health-care reform program.
However, Jost added, "I don't know that it would tell us much" if federal officials released any demographic data they've collected to date.
According to Jost, knowing the age distribution of enrollees is not "the most important question." He said, "The most important question is health status," in other words, knowing the mix of healthy and unhealthy in the pools of enrollees.
While conceding that there is a relationship between age and health status, Jost noted that one offset to the cost of benefits from older, sicker customers is the fact that older enrollees pay up to three times the premium costs in Obamacare plans as younger adults.
"You'd rather [as an insurer] have a healthy 64-year-old than the unhealthy 26-year-old," he said.
But Obamacare exchanges don't collect information about the health status of their applicants. "So the federal government just doesn't have that information," Jost said.
An analysis last month by the Kaiser Family Foundation suggested that fears that under-enrollment by young adults will hurt insurers' bottom lines are greatly overstated. That analysis calculated that if 18-to-34-year-olds enrolled at a rate 25 percent lower than other individuals relative to the potential market, then the added costs to insurers from health-care expenses and overhead would be just 1.1 percent higher than premium revenue.
In what Kaiser called the "likely worst-case scenario," in which that age group enrolled at a 50 percent lower rate, overall costs in plans would be about 2.4 percent higher than premium revenue.
In either scenario, insurers would still likely book a profit—albeit lower than the profit they had priced their plans for.
"Even in the worse case, insurers would still be expected to earn profits, and would then likely raise premiums in 2015 to make up the shortfall," Kaiser wrote. "However, a 1 to 2 percent premium increase would be well below the level that would trigger a 'death spiral,' which would occur if insurers needed to increase premiums substantially, in turn further discouraging young and healthy people from enrolling."
Insurers are also protected, analysts and government officials noted, by provisions in Obamacare including a reinsurance program that compensates plans sold on the exchanges for costs that exceed their revenue.
More changes ahead
If federal officials did release demographic data now, it would not be the last word in what the profile of total enrollment will be at the close of open enrollment on March 31, Jost said. There is "no question" that the demographic profile will change by then, he said.
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"I think we're going to get a lot more subsidy-eligible people, a lot more younger people, I think the age profile will certainly change," Jost said.
HHS spokeswoman Peters also suggested that would be the case, saying that Obamacare "is making health insurance more affordable for young adults."
"With nearly half of single, marketplace eligible uninsured young adults able to get coverage at $50 or less per month, the health-care law is delivering the quality, affordable coverage people are looking for," Peters said.
—By CNBC's Dan Mangan. Follow him on Twitter