Blaming problems with a federal website, insurance company executives told Arkansas lawmakers that fewer than 200 people have signed up for coverage through the insurance exchange set up for the state under the healthcare overhaul law since enrollment began Oct. 1.
“We fully expected that there would be issues, but we were a bit disappointed that the issues are as large as they are and that the enrollments are coming in as slowly as they are,” Cal Kellogg, executive vice president and chief strategy officer with Arkansas Blue Cross and Blue Shield, said at a meeting of the legislative oversight committee for the board created to explore taking over the operation of the state’s exchange from the federal government.
About 500,000 uninsured Arkansans are estimated to be eligible for subsidized coverage available through the exchange. The federal website, healthcare.gov, was meant to allow people in Arkansas and 35 other states to compare plans and sign up for coverage, but software glitches and other problems have prevented many people from being able to use that feature.
The 14 other states set up their own health insurance exchanges and are operating their own enrollment websites.
So far, only about 100 people have enrolled in plans offered by Arkansas Blue Cross and Blue Shield and the national Blue Cross and Blue Shield Association, Kellogg said.
Enrollment in plans offered by the other two companies participating in the exchange has been even lower.
Mike Stock, chief executive of Little Rock-based Qual-Choice Health Insurance, said about 50 people have signed up for plans offered by his company. John Ryan, chief executive of St. Louis-based Centene Corp.’s Arkansas Health and Wellness Solutions, said fewer than 20 people have signed up for his company’s plans.
“Our experience to date has been that it’s very slow,” Ryan said.
Stock said his company has also been trying to check the accuracy of information listed on healthcare.gov about the company’s plans, a process he called “very slow and tedious.”
“Just like consumers are having challenges getting into the system, we have challenges getting into the system just to do testing,” Stock said.
Stock and Kellogg said their companies have also been working to correct errors in the information in the electronic enrollment records they receive.
The difficulties with the website, the executives said, raise questions about the mix of people who will end up signing up for coverage in the plans for 2014.
While those who have costly medical conditions are likely to sign up, the companies also need healthy people to enroll for the plans to be profitable.
The people who have enrolled so far “probably really need the insurance and plan on using it pretty heavily once they have access to it,” Stock said.
Kellogg added, “We’re concerned that the longer that it goes for the website not functioning, and the more frustrated that the younger, healthier people are as they try to use that website, combined with a variety of other factors, we may not see the volume of participation in the marketplace that we expected to see and that we based our pricing on.”
Attempts by a reporter to log into the federal website on Wednesday led to a page saying, “The system is down at the moment.”
President Barack Obama said last week that he was initiating a “tech surge” to fix the problems with the site. A consultant assigned to lead the effort said he expected the site to “work smoothly for the vast majority of users” by December.
If that happens, Kellogg said after the hearing, that would give people time to enroll in plans by Dec. 15 for coverage that will start in January. Enrollment for coverage for 2014 will end on March 31.
The enrollment numbers given by the companies don’t include people who have signed up for coverage in private plans that will be purchased by Medicaid under the expansion of the program approved by the Legislature this year.
As of Saturday, 70,595 people had applied for coverage under the program, including 65,138 people who responded to a letter sent last month to recipients of the Supplemental Nutrition Assistance Program, also known as food stamps, and 5,457 who applied through a state website, by phone or by submitting a paper application, according to numbers released by the state Department of Human Services on Tuesday.
According to the department, 14,529 of the applicants, all of them food stamp recipients, had completed the enrollment process by visiting another state website, including 10,408 who will receive coverage through private plans and 4,121 who will be covered through traditional Medicaid because they have exceptional health needs.
Food-stamp recipients who responded to the department’s letter but have not completed enrollment, will be automatically assigned to a plan next week, the Human Services Department has said.
The expansion of the Medicaid program extended eligibility to adults with incomes of up to 138 percent of the federal poverty level - $15,860 for an individual or $32,500 for a family of four.
Those who do not qualify for Medicaid and have incomes of less than 400 percent of the poverty level - $45,960 for an individual or $94,200 for a family of four - may qualify for subsidies to help them buy coverage.
The tax-credit subsidies are available only to those who apply through the exchange set up by the U.S. Department of Health and Human Service’s Centers for Medicaid and Medicare Services. Applications can be submitted through the federal website, by calling (800) 318-2596 or by mailing an application to the federal agency.
Kellogg said Blue Cross-affiliated companies have been urging federal officials to allow people to sign up directly with insurance companies while submitting separate applications to the Centers for Medicare and Medicaid Services that would qualify them for subsidies.
About 400 people have signed up directly with Blue Cross for coverage in unsubsidized plans that will start Jan. 1, he said.
Asked by legislators about reports from other states of insurance companies canceling policies that do not meet requirements in the health-care law that take effect next year, Kellogg and Stock said their companies have not sent out such notices to customers in Arkansas.
Kellogg said about 56,000 of Arkansas Blue Cross’ policies are considered “grandfathered,” meaning they are exempt from the health-care law’s requirements, because they took effect before March 23, 2010, when Obama signed the law.
The company’s other 35,000individual policies, which Kellogg described as “lost boy” policies, are not grandfathered and cannot be renewed after Dec. 31 because they don’t meet the health-care law’s requirements. However, the company is giving customers the option of renewing them on Dec. 31 until Dec. 30, 2014.
Stock said virtually all of QualChoice’s individual insurance policies, covering about 7,500 people, are not grandfathered. QualChoice is also giving customers the option of renewing those policies at the end of this year for coverage that would extend through next year.
State Rep. Deborah Ferguson, D-West Memphis, said she was told that Arkansas Blue Cross would be cutting its reimbursement rates to specialists and nurse practitioners by 15 percent.
Kellogg said the company was offering lower rates to some providers, but only for plans sold through the exchange. He said rates reflect the fact that, with more people having insurance, the providers won’t have to provide as much uncompensated care.
Blue Cross spokesman Max Greenwood added that the rates are higher than those offered by the traditional Medicaid program or Medicare, the federal health insurance program for the elderly.