Health insurers in the federal exchange under Obamacare are complaining that people signing up in special enrollment periods have figured out how to game the system and receive months of care without paying their premiums.
Insurers blame the problem on lax rules that allow more than 900,000 people to sign up for coverage outside the standard enrollment season—for instance, when they change jobs or move—without sufficient proof they are eligible. No one knows precisely how many might be manipulating the system, but the plans say they run up much higher medical bills and then jump ship, contributing to double-digit rate increases and financial losses.
Health plans also complain some customers are exploiting a three-month "grace period"—when they can keep getting subsidized coverage even if they’ve stopped paying their share of premiums.
Because God forbid a sick person finds a way to get health care and an insurance company doesn’t profit. It's not at all clear that the number really is as high as 900,000 and the most expert outside observer of Obamacare—Kaiser Family Foundation's Larry Levitt—is skeptical that it's as big a problem as insurers are making it out to be. "It's still a small minority of enrollees," he told Politico. "It's overstating it to say people can simply sign up whenever they want." He went on to explain that people signing up in these periods are likelier to be more expensive than others because people who have a real need for health care are more motivated to figure out how to enroll outside of normal enrollments. It's key, he says, "to limit these special-enrollment periods to people who truly find themselves in unforeseen circumstances, but without making the burden of documentation so great that it discourages people who really qualify."
Obama administration official Andy Slavitt, acting administrator for the Centers for Medicare & Medicaid Services which oversees Obamacare, says that they are looking at ways to tighten the rules and the screening for people signing up in the special enrollment periods. "There may be bad actors and others out there who are abusing those," he said in a speech Monday at the J.P. Morgan Healthcare Conference. The administration will announce its plans for tightening up the rules next week.