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Obama administration predicts significantly lower health-care enrollment

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The Obama administration predicted Monday that the number of people with health coverage through the Affordable Care Act’s insurance marketplaces will be significantly lower by the end of next year than previous government estimates.

Health and Human Services Secretary Sylvia Mathews Burwell announced that, by the end of 2015, 9 million to 9.9 million Americans probably will be in health plans sold through the federal and state insurance exchanges created under the health-care law. The administration’s expectations are as much as roughly 30 percent beneath the most recent prediction of the Congressional Budget Office — that 13 million people will have health coverage through these exchanges next year.

The discrepancy revives questions about the pace of progress on a central mission of the law — to widen Americans’ access to affordable insurance — and how well the administration and its allies will be able to keep customers who already have bought marketplace health plans and attract new ones.

The new figures mark the first time that the administration has shared publicly its view of how popular the marketplaces’ health plans, which began to provide coverage in January, will prove after their first two years. The figures are based on an analysis by HHS researchers that considered how long it took Americans to flow into other public health insurance programs when they were new, how many people will stay in health plans sold through insurance exchanges and how many uninsured people will gravitate to the new marketplaces.

HHS officials also said Monday that of the 8 million people who bought health plans by this past spring for the first year of coverage under the law, 7.1 million remained in them as of mid-October. Of those who left, some had stopped paying their monthly insurance premiums, and 112,000 were immigrants dropped by the government because they had not proved that they were eligible.

The administration’s enrollment expectations appeared five days before the start of the second sign-up period through the federal insurance exchange being used in about three dozen states and through separate state-run exchanges. The figures also emerged as the health-care law — enacted in 2010 as a crowning domestic achievement of Obama’s presidency — is facing new political and legal peril.

Congressional Republicans, who won a Senate majority in the midterm elections last week, have vowed to continue their efforts to repeal the law, or at least make dents in pieces of it.

And the Supreme Court has just announced that it will review the legality of a linchpin of the law: government subsidies that are helping more than four in five people who have gotten insured through the federal exchange to afford their health plans.

Exactly what the administration’s enrollment expectations will mean about the law’s ultimate success is a matter of debate. If too few people sign up in the long run, health plans could drop out of the program or insurance prices could rise.

The HHS officials, who briefed reporters before the secretary’s announcement on the condition of anonymity, said the differing predictions largely reflect varying assumptions about timing. They expect that enrollment in health plans under the law probably will phase in over four or five years — more gradually than the three-year phase-in assumed by congressional budget analysts.

By 2017, the congressional budget analysts said in their most recent estimates, which were issued in April, the exchanges will have reached their full enrollment: 25 million. HHS officials declined to discuss whether the program eventually will attract that number.

Some health policy specialists speculated that administration officials had made a strategic decision to issue a relatively low prediction to increase the chances that the sign-up this time will surpass it. Meanwhile, Republican foes of the health-care law portrayed the administration’s lower number as a sign that consumers have realized that health plans sold through the marketplaces are “not a good deal for them,” as Sen. John Barrasso (R-Wyo.), an outspoken critic, put it.

Other health policy specialists said the significance of the lower figures will not become clear until the sign-up period, from Nov. 15 to Feb. 15, has ended. On one hand, people most eager for insurance may already have signed up.

On the other, people may be motivated to get coverage because the law requires it of most Americans and because a financial penalty for remaining uninsured will increase next year.

“There is still a lot of mystery,” said Larry Levitt, senior vice president of the Kaiser Family Foundation, a health policy organization.

The insurance exchanges are one of two paths the law envisioned to help people who cannot get affordable health coverage through a job. The other path is Medicaid, for people with lower incomes; about half the states have expanded their Medicaid programs under the law.

Burwell said the administration’s enrollment target for new and returning customers would be 9.1 million for 2015.

The health officials said they are forecasting that slightly more than eight in 10 people who got coverage this year through the exchanges will renew it. That means that 5.9 million of the 7.1 million current customers will keep their health plan or choose another one through an exchange.

Of those who leave, officials said they do not expect many to become uninsured. Some, they said, will be able to find insurance through an employer, still the way that most Americans get health insurance. Others, they said, will find their incomes dropping enough that they begin to qualify for Medicaid.

HHS officials played down the fact that their analysis suggests that fewer people will buy a health plan for the first time during the second round than did so in the first.

Because the analysis anticipates that 5.9 million customers will renew coverage and that up to 9.9 million will be covered by the end of 2015, that means the administration is expecting no more than 4 million first-time customers during this second enrollment period — half as many as last time.

Burwell hinted at the challenges at a Washington event to draw attention to the start of the second enrollment period and promote improvements to the federal online marketplace, “We are moving to a group,” she said, “that might be harder to reach.”

Jason Millman contributed to this report.

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