“Only approximately 64,000 Kentuckians enrolling in Obamacare have enrolled in a private plan in Kentucky’s own Obamacare exchange, far fewer than the 280,000 who received cancellation notices of plans they had and liked.”
— Sen. Mitch McConnell (R-Ky.), in an opinion article in the Louisville Courier-Journal, March 29
This assertion by the Senate minority leader is a textbook case of the type of comparison that opponents of the Affordable Care Act have been making for months: the number of plans “canceled” or discontinued vs. the number of plans sold on exchanges. Nationwide, GOP critics have noted, about 5 million plans were canceled, a number that generally worked in their favor until a sudden surge pushed the number of reported exchange sign-ups past 7.1 million.
We have explained before that, depending on the phrasing, this can be a misleading comparison. But the gap in the numbers in McConnell’s op-ed jumped out at The Fact Checker, especially because Kentucky is a rare example of a red state building an exchange that, by most accounts, has operated smoothly. What’s behind these numbers?
McConnell relied on an announcement by the Kentucky Department of Insurance in early November about the number of plans that might be affected by the Affordable Care Act: 130,000 individual plans and 150,000 small-group policies.
That adds up to 280,000, but already McConnell’s comparison looks like a shaky case of apples and oranges. The 68,000 individual plans sold on the exchange (now 77,000) mentioned in his article can be related only to the 130,000 individual plan policies. Adding in small-group policies inflates the total.
Indeed, in the Associated Press state-by-state tally of 4.7 million cancellations, often cited by Republicans, the figure listed for Kentucky is 130,000.
Ronda Sloan, a spokeswoman for the department, said there was some confusion in the reporting about what the November statement meant, in that the 280,000 figure “was simply the number of people in the individual and small-group markets at that time who potentially could have received a letter saying their health insurance policies were being discontinued” because benefits were changing.”
In other words, when the state made the announcement, it did not know how many plans might actually comply with the law; it just described the size of the individual and small-group markets.
The statement also stressed that “discontinuation notices” would be mailed when policies were up for renewal. We have no idea what the flow would be, but just taking a simple average over 12 months yields 11,000 individual policies a month. That adds up to only 55,000 individual policies since November, yet McConnell assumed that all of the notices had been mailed and received. (Letters from insurance companies posted on the department’s Web site indicate that at least 40,000 were sent through December.)
Finally, it turns out that the 280,000 figure is out of date. In December, the state said it had determined that more than 48,000 plans were grandfathered in under ACA and that nearly 64,000 qualified for transitional relief under an administrative fix announced by the Obama administration. (The state did not distinguish between individual and small-group plans in its announcement, but overall that’s a 40 percent reduction.)
That brought the total down to 168,000, a figure that was reported in the Kentucky news media under headlines such as, “Number of Kentuckians Who Must Upgrade Health Plans Under Obamacare Lower Than Expected.” Newspapers in Kentucky have quoted other GOP lawmakers, such as State Senate President Robert Stivers, as using the revised figure.
Just one month had passed from the first announcement, so “only a small number of the 280,000 ever received a discontinuation notice,” Sloan said. She noted that insurance companies gave the remaining plans the option to take early renewal (to continue pre-ACA plans) through at least Dec. 1, 2014.
Kentucky has not decided whether to accept the administration’s offer to extend transitional relief through 2016. But at the very least, nearly 20 percent of Kentuckians in the initial estimate never did and never will receive letters because their plans complied with the law. Although exact numbers are not available, that suggests the individual market pool affected by the law was closer to 100,000 than 130,000 — and certainly not 280,000.
One interesting side note: State officials say preliminary research indicates that 75 percent of the people who signed up for private plans on the state exchange were previously uninsured. That suggests that the 77,000 figure cannot be easily compared to the 130,000 people who had insurance in Kentucky’s individual market before the new health-care law took effect.
“The op-ed pointed out that while Democrats were yelling ‘mission accomplished,’ Kentuckians who lost the plan they had [despite being promised the opposite] weren’t popping any champagne corks,” McConnell spokesman Don Stewart said. “And while the Democrats may only want to point to people who have signed up, the point the leader made was that they were failing to count the consequences of their failed law. It makes sense to compare apples and oranges — because both groups were lied to.”
The Pinocchio Test
Unlike some Republican lawmakers, McConnell was not claiming that there has been a reduction in the number of insured or that 216,000 remained uninsured. In that respect, his comment was carefully crafted. But McConnell’s claim that 280,000 Kentuckians have received cancellation notices does not hold up to scrutiny.
Although 280,000 was a broad estimate released by the state in November, Kentucky officials reduced the figure by 40 percent just a month later — and yet McConnell is still citing outdated numbers. Moreover, because termination notices are sent on a rolling basis, it’s likely that far few notices have even been sent.
Finally, even if 280,000 was correct and even if all notices had been sent, it’s still the wrong number to use when referring to individual health plans purchased on the exchange, as 280,000 is the sum of individual and small-group plans.
We wavered between three and four Pinocchios but ultimately settled on four, given that other GOP lawmakers in the state have accepted the reduced estimate.
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