Two keys to making the Affordable Care Act work have always been a working website and a lot of young enrollees. As of right now neither of those are in the cards. The Wall Street Journal reported Monday night that Obamacare might be on the cusp of a death spiral — the average age of enrollees is much, much higher than anyone anticipated or hoped for. "We need a broad range of people to make this work, and we're not seeing that right now," on Ohio insurer told the Journal. "We're seeing the population skewing older." Insurers have either seen the average age of their customers jump from 40-something to 50-something, or noticed that the largest segment of their new enrollments falls in the 55+ age range.
There are two explanations for this. Either young people aren't going to sign up and next year everyone will have obscenely high premiums or (and this is much more likely) only older, sicker people are signing up right now. You may have heard that the website isn't working well, and that's more likely to deter young, healthy people than older, less healthy individuals. (The Obama administration argues that young people enrolled at the last minute in Massachusetts when the state enacted its version of Obamacare in 2007.) Still, in states like Connecticut and Kentucky, which have functioning state-run exchanges, enrollee ages are also skewing high, suggesting that the "economics" of insurance play a role as well.
Just over a month in, it's too soon to tell, but that won't stop speculation. Detractors of the health care law have already latched on to the "War on Bros" slogan, arguing that Obamacare is already raising insurance premiums across the country, especially for healthy young men who are subsidizing the old and sick. (Healthy young women are also being affected, but not as much since they were getting charged more than men for insurance before Obamacare.)
Tomorrow Health and Human Services Secretary Kathleen Sebelius will meet with the Democrat-led Senate Finance Committee to discuss the law's implementation. This will be the fourth hearing held since the site launch — Sebelius, Tavenner and various Healthcare.gov contractors were previously grilled during House hearings. But what started as hearings on the website quickly turned into hearings on dropped plans, as Americans across the country received insurance cancellation letters. The site is still a problem, but these dropped plans, and now the possibility of an insurance death spiral, are a bit more serious.