Even if health website works, Obamacare could see trouble ahead

Credit: Reuters/Joe Skipper

A busy screen is shown on the laptop of a Certified Application Counselor as he attempted to enroll an interested person for Affordable Care Act insurance, known as Obamacare, at the Borinquen Medical Center in Miami, Florida October 2, 2013.

The problem, according to insurance industry officials and other specialists, is that the administration is behind schedule in building a computer program needed to verify the names and coverage choices of enrollees in the system created by the Affordable Care Act, commonly called Obamacare.

Besides verifying enrollees, the computer program - which administration officials acknowledge will not be finished until mid-January or even February - also will be used to help determine which low-income enrollees are eligible for government subsidies to help them pay for insurance, and to make sure that those subsidies get to insurers.

That makes the program, known generally as the 'back end' of the Obamacare bureaucracy, crucial to the new health system's goal of helping millions of uninsured and under-insured Americans.

It also means that even if the HealthCare.gov website is able to finally handle the flood of enrollees that officials expect, the administration could face a backlash from people who have enrolled but whose paperwork will not be completed by the time their coverage is supposed to take effect on January 1.

The online marketplaces for health insurance opened for enrollment on October 1, but were beset by technical problems. Any significant new difficulties would hinder efforts by President Barack Obama and his Democratic allies to show they have been able to surmount the botched rollout of their healthcare overhaul and can start to recover from the political damage that followed. Republicans, who have argued for the healthcare law to be delayed or killed, will be looking to create a new narrative critical of Obamacare going into next year's mid-term elections.

'COVERAGE COULD BE DISRUPTED'

Without the program operating fully, information about some enrollees can wind up missing, incomplete or inaccurate by the time insurers receive it from the exchanges, analysts said.

'This is a significant issue,' said Dan Mendelson, a healthcare specialist who worked in the White House Office of Management and Budget during the Clinton administration.

'People could wind up going to the doctor or the hospital, thinking they're enrolled, when they may not be,' said one insurance industry official, who asked not to be identified because he did not want to comment publicly.

It is not clear how many people could be affected.

But in a system that eventually could have about 7 million people enrolled, the potential for inaccurate information spans the 36 states served by HealthCare.gov and the 14 states with their own insurance marketplaces, all of which rely on the same technology for administrative functions.

'If ... the ongoing back end challenges are still not resolved, the enrollment process may not be completed and consumers' coverage could be disrupted,' said Robert Zirkelbach, spokesman for America's Health Insurance Plans, an industry trade and lobbying group.

Consumers 'will forgive some start-up issues with the ability to enroll on the website,' said Gregory Nersessian, principal with consulting firm Health Management Associates.

Nersessian said, however, that 'it's going to be far more damaging if their information and their expectation about enrollment and payment and coverage get confused because of the back end system.'

U.S. officials acknowledge that completing the computer program on the administrative end is necessary to ensure accurate enrollment.

But in recent weeks they have focused more on fixing the 'front end' of Obamacare that consumers see: the HealthCare.gov website that allows people to enroll in the program.

Those wanting health coverage by January 1 initially had until December 15 to enroll, but the website's problems led the administration to extend that deadline to December 23.

Officials say that some enrollment documents are being processed by hand until the administrative computer program is in place. Many of those applications are not likely to be processed until the new year, officials at the Centers for Medicare and Medicaid Services said.

Other vital 'back end' functions that are still being built into Obamacare's computer system include a financial management program that will allow the government to distribute to insurers the billions of dollars in tax credits and other subsidies needed to help low-income consumers pay for coverage.

(Additional reporting by Lewis Krauskopf in New York; Editing by David Lindsey and Grant McCool)