How Well Are Obamacare's State-Run Exchanges Actually Working?

As problems with Obamacare’s
federal exchange system have continued, supporters of the health
law have turned to a backup argument. Sure, the law is struggling
due to technical problems, but in the states that decided to set up
their own exchanges, it’s actually going reasonably well.
California, in particular, is being singled out for its high
enrollment numbers—numbers that some reports have said put the
state on track to hit its enrollment targets.

The reality of the state-run exchanges is a little more
complicated. There’s no question that the state systems are, on the
whole, working better than the federally facilitated exchanges. But
serious problems continue to plague a significant minority of the
state-run exchanges. And even states said to be success stories may
not be quite as successful as claimed.

The argument that state-run exchanges, put in place by state
governments that wanted to make the law work, predates the October
launch. Obama himself made a version of the argument during the
last week in September, when he went to Maryland to give a
speech about the law, and to tout its state-run exchange.

But Maryland is one of the states that has struggled most to get
its exchange up and running. The technical troubles are significant
enough that it turned to paper applications and other workarounds.
But it’s not getting the sign up numbers it was hoping for. As
The Washington Post
reports, just 1,278 people signed up for private coverage in
the state during October, and another 465 in the first week of
November. Those low numbers, the Post piece notes, “raise
questions about whether Maryland will achieve its enrollment target
of 150,000 by the end of March.”

Maryland has at least managed to get some people to the final
step of the private plan enrollment process. The same can’t be said
for Oregon. Not a single person has yet to enroll in private
coverage through the state’s broken exchange,
according to  Reuters. The state exchange—which The
Washington Post
once described as “the White House’s favorite health
exchange—was delayed before the October launch, and has never gone
online. And there’s no sign that it will in the foreseeable future.
Reuters says that its marketplace is “out of commission and
unavailable to the public indefinitely.” I suspect the White House
isn’t too thrilled anymore.

These aren’t the only state-run systems that have had or still
have serious problems. As The New York Times
noted last week, Hawaii’s site went down on launch day, didn’t
come back online for weeks, and “users continue to report
problems.” Vermont’s exchange system does not yet process
individual payments for insurers, which presumably complicates
enrollment. Vermont’s system was
built by CGI Group—the same contractor that botched the federal
exchanges.

So it’s not all flowers and rainbows in the state-run exchanges.
And even where things are going relatively well, there are still
problems. In Washington state, for example, a pricing glitch means
that about 8,000 people are finding out that they’ll be
eligible for a smaller federal subsidy for their insurance than
they were initially told. One of those people was a woman whom
President Obama highlighted in a speech as being able to finally
obtain affordable insurance. Her new, revised price is so high that
she
now says she expects to remain uninsured.

In other states,
like Kentucky, Connecticut, and California, the demographic mix
of people signing up for plans appears to skew old, which could
pose longer-term problems if the insurance pools turn out to be
more expensive than expected.

And that’s presuming that any of these states actually hit their
enrollment targets. The Los Angeles Times
reported this week that the numbers so far suggest that
California is on track to meet its 2014 enrollment goals after a
“sharp increase in November.”

But the enrollment numbers released for the state so far don’t
actually say how many people have completed the enrollment process.
An
HHS report on Obamacare signups from last week counts 35,364
individuals as having “selected a Marketplace plan” in California,
which means they’ve dropped it into their online shopping cart. A
Los Angeles Times
report from last weekend merely describes people as having
“selected” health plans.

And there appear to be issues with income and subsidy
verification as well. The same HHS report lists the  number of
people determined “eligible to enroll in a Marketplace plan with
financial assistance” as not applicable; that data is available in
most of the other state-run exchanges. Last weekend’s Los
Angeles Times report noted significant problems for enrollment
assisters. One potential applicant
told the LAT that “You can look, but you can’t use the
website to do the income calculation.”

That’s what Obamacare’s state-run exchanges look like. Even
where they appear to be working, it’s not clear they’re working all
that well.