Did states get their money’s worth when they spent large federal grants on “assisting” customers using their insurance exchanges?
Hawaii’s exchange was particularly troublesome for users from its beginning. Perhaps almost as infuriating for residents is the small fortune that the state spent on efforts to help people sign up; the state is spending $87.86 in “consumer assistance funding” for every eligible uninsured person in the state, according to a new report by the Leonard Davis Institute of Health Economics and the Robert Wood Johnson Foundation.
Hawaii’s insurance exchange ranked among the nation’s most dysfunctional, not working at all for the first two weeks. It was supposed to be self-sustaining starting next year but enrollment — 8,742 as of mid-April — fell short of projections; state lawmakers approved another $1.5 million in spending to prop up the exchange for the next year.
But Hawaii wasn’t the champion spender. The District of Columbia spent $163.90 per eligible uninsured person, according to the report. Exchange managers may argue the expenditure is paying off; D.C. did surpass its projected totals handily, enrolling 10,714 people.
Delaware spent $67.39 per eligible uninsured — that enrolled 14,807 in its exchange — and Vermont rounded out the top four with nearly $60 for every eligible uninsured person in the state. That state enrolled 24,888 people in its exchange.
You paid for this, even if you don’t live in those states. The U.S. Department of Health and Human Services created an “In-Person Assister (IPA)” program that states could fund through the federal block grants, which totaled more than $3 billion. Sixteen states and the District could decide how much to spend on IPAs and how to disburse the funds through September 2015.
The report found that those states running their own exchanges spent way more per uninsured person than states using the federal exchange. States on the federal exchange spent from $4.24 per uninsured in Georgia to $17.22 in Alaska. As the report notes, the funds allocated to states using the federal exchange were allocated based upon the number of insured, beyond certain minimums.
The lowest amount of spending per insured by a state running its own exchange came in Nevada, which spent $6.18.
Spending was high in the other states with particularly troublesome or unworkable exchanges. Maryland spent more than $50 per eligible uninsured, placing it in the top ten. That state spent $130 million on its exchange, never successfully signed up anyone through the online process, and now plans to replace it, spending another $40 million to $50 million.
Minnesota spent $30 per eligible uninsured; that state’s exchange also suffered from technical issues making it unworkable early on and lengthy waits for help from its call center.
Oregon recently decided to completely scrap its exchange, which failed to sign up anyone and was mocked on comedian John Oliver’s new HBO show last weekend for wasting money.
“That has to be a bitter pill to swallow for the people of Oregon, or it would be, if they could get the pill, which they can’t, because their [expletive] web site is broken,” he cracked.
The state can at least point to a relatively low expenditure in this area; Oregon spent just over $10 per eligible uninsured.
Big differences from state to state.