Fixing haywire HealthCare.gov is just one hurdle for Obamacare

One month after the disastrous launch of HealthCare.gov, the balky federal government website at the heart of President Obama's health-insurance reform, the officials in charge of implementing the program are hardly resting easy.

"Hold me accountable for the debacle. I'm responsible," Health and Human Services Secretary Kathleen Sebelius said Oct. 30 at a House hearing. "We did not adequately do end-to-end testing."

Jeffrey Zients, the management expert brought in to direct the site's overhaul, promises it will be operating smoothly by Nov. 30. That means no more crashing, no more bottlenecks, no more glitchy data. Uninsured Americans in the 36 states served by the site should be able to register, shop, and enroll in health coverage with relative ease.

In and of itself, that's a tall order, given the extent of the site's problems – as well as its complexity, unprecedented for the public sector, as the site connects numerous government agencies at both the state and federal levels.

But even if HealthCare.gov is running well in a few weeks, the challenge of implementing the most controversial aspect of the Affordable Care Act (ACA) – the individual mandate to carry health insurance – will have only just begun. The practical and political implications are profound.

Start with the fact that by Nov. 30 there will be only two weeks until the Dec. 15 deadline to enroll in coverage that begins on Jan. 1 – the date the individual mandate kicks in.

"That's definitely aggressive," says Caroline Pearson, vice president of Avalere Health, a health-care consulting firm.

Even before the HealthCare.gov meltdown, administration officials expected enrollment to ramp up slowly, as uninsured Americans learned about the program and studied their options. People generally don't make a big purchase months before they have to. When open enrollment started in Massachusetts' new mandatory health insurance system in 2007, only 123 people signed up the first month. (Granted, that's just one state, and many residents had a full year to enroll.)

The Obama administration has not revealed enrollment numbers but promises data by mid-November – both for those enrolling via HealthCare.gov and via the exchanges that 14 states plus the District of Columbia opted to run themselves, some of which work well.

Under "Obamacare," as the ACA is popularly known, the enrollment period ahead of the first deadline has been compressed, raising the risk of another flood of traffic to HealthCare.gov as Dec. 15 approaches. Though, as officials from private contractors who worked on the site testified to Congress Oct. 24, the problem with HealthCare.gov wasn't so much the volume as it was the structural design of the site – blaming the Department of Health and Human Services (HHS), which kept the management of the project in-house.

For some Americans, having new health insurance in effect by Jan. 1 truly matters. Those currently enrolled in high-risk pools – by definition, because they have health issues – will see that coverage expire on Dec. 31. They are anxious to be on their new plan with no lapse, and maybe even save some money.

Anna Franks of Ogden, Utah, has been paying $653 a month for a high-risk plan, and expected to pay close to $230 on the exchange, according to The Salt Lake Tribune.

"It will be nice to be able to get a little ahead [financially]," she told the paper at a health-care "open house" on the first day of enrollment.

In addition, some people are frozen out of the individual insurance market completely because of a health condition. Under the ACA, they can no longer be excluded, and so for them, the new coverage can't start soon enough.

Then there are the hundreds of thousands of Americans getting letters telling them that their health insurance is being terminated at the end of the year. Republicans such as Sen. Marco Rubio of Florida have seized upon the 300,000 letters sent out in October by insurer Florida Blue as evidence that Obamacare is throwing people off their insurance, with no ability to buy a new plan, and setting them up to be fined by the Internal Revenue Service.

It's true, some individual plans are being discontinued because they don't meet the new, higher standards of coverage under the ACA. But in most cases, customers are automatically being shifted to a qualified plan, or they can contact their insurer to choose another plan. PolitiFact.com rated Senator Rubio's claim "mostly false."

These customers can also shop for new coverage on HealthCare.gov – if the site is working – and possibly receive a subsidy, if their income is low enough. But like those in high-risk pools, they will need to enroll soon to prevent a lapse in coverage.

If the website isn't fixed soon?

The assurances of Mr. Zients – the soon-to-be White House economic adviser who has swooped into HHS to save HealthCare.gov – were so firm, it's hard to imagine he won't deliver on his promise.

But what if the problems drag on beyond Nov. 30? Politicians from both parties are calling on the Obama administration to delay the individual mandate, which starts Jan. 1 (but allows a person to go three months without insurance in a calendar year, and so the deadline is effectively March 31). After all, they say, how can you penalize someone for failing to buy something when they can't get into the store and move around comfortably?

Experts on the US health-care system say the deadlines aren't the issue. The administration has the power to delay them, even by a few weeks, if the problems with the mechanics of enrollment persist. White House spokesman Jay Carney points out that the government has flexibility in assessing penalties.

"The law is clear that if you do not have access to affordable health insurance then you will not be asked to pay a penalty because you haven't purchased affordable health insurance," Mr. Carney said Oct. 21.

In addition, insurers could temporarily extend the coverage of plans due to expire at the end of the year, to prevent gaps in coverage.

The challenge ahead

The biggest challenge, experts say, is instilling confidence in both consumers and the insurance industry that the new health-insurance marketplace is going to work. If the problems with this year's rollout discourage people from enrolling – particularly healthy people, who may be less motivated to buy coverage – insurers might find themselves with a risk pool weighted toward the unhealthy. The ACA includes provisions to protect the insurers financially if that happens, but it won't prevent them from raising their rates in 2015 or dropping out of the individual market altogether.

"The market needs to be able to perform relatively soon, so the insurance industry can look into next year and say we want to keep participating," says Gary Claxton, director of the Health Care Marketplace Project at the Kaiser Family Foundation.

NEXT: James and Miranda Seal of Irvington, Ala., currently have no health insurance. But they aren't exactly rushing to shop for it on HealthCare.gov, despite the looming mandate for everyone to have coverage next year (or pay a penalty). Here's their story.