Healthcare Business News
Magic Johnson

Reform Update: Federal, state exchanges tap star power to draw younger enrollees

By Paul Demko
Posted: January 16, 2014 - 3:45 pm ET

When HHS officials announced the latest enrollment figures for the state and federal exchanges this week, the top-line number—2.2 million through Dec. 24—was already known.

But it was the first time that the federal agency released significant demographic data. The figure that caused the most consternation was that just 24% of exchange enrollees were under the age of 35. That's significantly less than the 33% to 40% figures that experts have cited as likely necessary to build stable risk pools. But nobody knows exactly what the magic number is since age isn't necessarily indicative of health.

But the federal and state exchanges are redoubling efforts to entice younger, healthier customers into the marketplaces. The White House recently hired Marlon Marshall, who served as deputy national field director on Obama's 2012 presidential campaign, to help with outreach efforts geared towards young people.

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On Thursday, the CMS released advertisements featuring former NBA stars Magic Johnson and Alonzo Mourning. Johnson has lived with HIV since for more than two decades. Mourning retired from the NBA because of a life-threatening kidney disease, but subsequently returned to the court after receiving a transplant. The ads will air during basketball games on ESPN, TNT and other channels. “We know the young and healthy audience responds well to sports figures, and these 30-second ads feature two NBA legends that each have a compelling health story,” CMS spokeswoman Julie Bataille said in a statement.

States are making similar efforts to reach younger potential enrollees. Washington's exchange, for example, is partnering with the concert promoter Live Nation to boost the online marketplace. Washington Health Benefit Exchange has signed on as a sponsor of the Sasquatch! Music Festival, which next takes place in May. On Feb. 3, the state exchange is sponsoring a launch party for the outdoor festival at Seattle's Neptune Theater that will feature performers such as Cold War Kids and St. Lucia. Richard Onizuka, the exchange's CEO said the initiative would “leverage the affinity and trust that Washington concert-goers, specifically young adults, have for music.”

But if comments by insurance executives at this week's JP Morgan Healthcare conference in San Francisco are any indication, the angst over the initial demographic data may be misplaced. Their comments regarding the exchanges—despite the bumpy rollout—were generally positive.

“Despite the near-term uncertainty, we believe exchanges will be growing as a big part of the market over time,” said Joseph Swedish, CEO of WellPoint, which is selling products on the exchanges in all 14 states where it does business. “We are more focused on the endgame of exchanges than the twists and turns in the near term.”

Jay Gellert, president and CEO of Health Net, was even more bullish on the fledgling marketplaces. “Our view is that once this gets into place, there's some continued, significant growth opportunities,” he said. “We're all in, and we're happy we are.”

In fact, insurance consultant John Gorman suggests the latest enrollment data marks a significant step toward entrenchment of the federal healthcare overhaul. “It was the last gasp of the Obamacare dead-enders,” Gorman said. “It's now pretty clear this program's going to work. It's going to be a rocky couple of years cleaning up this goat rodeo, but this program's going to work.”

Oregon gubernatorial candidate pushes to scrap state exchange

Calls are increasing for Oregon to dump its dysfunctional exchange website in favor of Republican state Rep. Dennis Richardson, who is running for governor, said he will introduce legislation next month to scrap the site, which has yet to successfully enroll a single person in healthcare coverage. "Cover Oregon has made us the laughingstock of the nation by failing to deliver a working health insurance marketplace—despite spending $140 million on the project," Richardson said in a statement. The issue could become politically problematic for Democratic Gov. John Kitzhaber, a vigorous supporter of healthcare reform, who is up for re-election this year.

House passes exchange disclosure bill

On Thursday, the House passed a bill requiring greater disclosure of federal exchange activities. The Exchange Information and Disclosure Act, authored by Rep. Lee Terry (R-Neb.), passed on a 259-154 vote. All Republicans were joined by 33 Democrats in adopting the legislation. It would require HHS to publish weekly reports through March 31, 2015, documenting consumer interactions with and the federal call center. It would also require the federal agency to report the names of all navigators and certified application counselors who have been trained to enroll people in coverage. The Obama administration is opposed to the bill and it's not expected to come up for a vote in the Senate.

Follow Paul Demko on Twitter: @MHpdemko

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