Enrollment milestone called 'proof of concept' by Obamacare supporters

By David Morgan

WASHINGTON (Reuters) - President Barack Obama's embattled U.S. healthcare law, having survived a rollout marred by technology failures, reaches a milestone on Monday with the end of its first enrollment wave, and with the administration likely to come close to its goal of signing up 7 million people in private health insurance.

But as the White House and its allies declare victory, major hurdles remain. And it will take years to determine whether the law will accomplish its mission of creating stable insurance markets that can help a significant number of America's nearly 50 million uninsured gain health coverage, experts say.

Republicans are counting on that uncertainty to play into their strategy for the midterm congressional elections in November. Their plan: Draw on public dissatisfaction with the Patient Protection and Affordable Care Act to help the GOP win control of the U.S. Senate and retain the party's dominance in the House of Representatives.

"We're not really going to know whether it worked or not until the third or fourth year. And of course, that's two elections down the road," said Timothy Jost, a professor at the Washington and Lee University School of Law in Lexington, Virginia.

"What I worry about is that we won't be able to figure out whether it's worked or not until it's too late," he said.

Even before the first enrollment period comes to a close, Republicans and some Democrats have separately proposed election year changes that could appeal to voter concerns -- and would leave the law substantially altered.

Republican proposals would undermine Obamacare by making health insurance optional and returning sick people to high-risk pools. A handful of Senate Democrats last week also proposed some Republican-sounding ideas that would allow insurance to be sold across state lines, discontinue the employer mandate for many small businesses and allow low-premium, high-deductible plans to be sold in the marketplaces.

Families USA, an administration ally on healthcare reform, plans to make its own public recommendations this week on how the enrollment drive for 2015 might be improved. "Our recommendations will build‎ on the laudatory success of the first enrollment period," said Ron Pollack, the group's executive director.

'PROOF OF CONCEPT'

So far, enrollment has been uneven. About half the states are expanding Medicaid as the law intended, and interest in private insurance lags in more than a dozen states where public leaders oppose Obamacare or have failed to produce a working state-operated marketplace. Consumer costs next year could vary widely, with premiums likely to rise in the double-digit percentages in states with lower enrollment.

"In most of the country, they've basically done a proof of concept: It can work. It has not yet succeeded and won't succeed until you know that most of the uninsured have been covered and the market's stable, with reasonable growth in premiums," said Larry Levitt, a health policy expert at the nonpartisan Kaiser Family Foundation.

The nonpartisan Congressional Budget Office estimates that 14 million people will obtain health coverage this year through the private insurance marketplaces or the expansion of the Medicaid program for the poor. However, coverage is not expected to hit its peak of 37 million people until 2018, when the CBO forecasts 25 million people in the marketplaces and 12 million enrolled through Medicaid or its sister health plan, the Children's Health Insurance Program

Over the next year the administration plans to fully link its enrollment website, HealthCare.gov, with the insurance industry for sign-ups and payments. The administration still has no automated systems for confirming enrollment data, distributing subsidies or compensating insurers for unexpected losses.

There are signs of a last-minute enrollment surge by younger adults for 2014 that could help keep the new online marketplaces viable for insurers. Hospitals and doctor practices are also introducing changes to the way they provide healthcare in line with the law.

"The Affordable Care Act is here to stay. It's the framework that everybody in the healthcare industry is working within and developing their strategic plans around," said Dr. Ezekiel Emanuel, who was a top White House adviser on healthcare during the law's development.

"Even the opposition, the Republicans, recognize the ACA is the law of the land, and despite the rhetoric, actually accept it," he said.

Many of the newly insured are ready to declare the law's benefits. Barbara Doucet, 63, of Newnan, Georgia, sais she can afford health insurance for the first time in 14 years and no longer worries about what might happen should she have an accident or become seriously ill.

"I was scared constantly, absolutely terrified that something would happen and what would I do. I didn't sleep really well for a long, long, long, long time," Doucet, a waitress and reform advocate, told Reuters in an interview arranged through Consumers Union, a public advocacy group that sees Obamacare as a benefit to consumers.

"I'm extremely pleased with ACA, I really am," she said.

Stories like Doucet's clash with tales of people who find insurance more expensive because of Obamacare's expanded coverage requirements.

Amy Newbold, a 57-year-old saleswoman from Randolph County, North Carolina, lost her employer insurance last year.

Through HealthCare.gov, she found a mid-tier "silver" plan with premiums that at first blush are $75 a month lower than her previous policy. But there are no savings, she says, since her old premiums were paid with pretax dollars and Obamacare premiums are paid with aftertax dollars. Newbold said she faces substantially higher drug costs for arthritis and psoriasis and worries that an out-of-pocket maximum of $5,000 could put needed medicines out of reach.

"I feel left out in the cold, and I don't know why it has to be that way," she said in an interview arranged through the office of Republican U.S. Representative Renee Ellmers, an Obamacare opponent from North Carolina.

'IMPROVING' THE LAW

If Republicans seize the Senate from Democrats, Obama may be forced to compromise on key aspects of the law, including requirements that most individuals obtain coverage and that employers with 50 or more workers offer health coverage, two of its most unpopular provisions.

Polls show most Americans would prefer to see Obamacare changed, not repealed. In a March survey from the Kaiser Family Foundation, most Americans dislike the law, but 59 percent wanted it retained or improved.

That could make Republicans think twice about pushing for repeal. But analysts say big changes may still be likely.

Some key features of the law are likely to endure, they say, pointing to the ban on higher costs for people with preexisting medical conditions and new medical business models that discourage costly fee-for-service medicine by putting a priority on patient outcomes and cost savings.

Analysts say Republicans could also scale back marketplace subsidies to help low-income consumers buy insurance, pricing restrictions on insurers and taxes intended to help fund the reform effort. And they predict that if Democrats are chastened by losses in the congressional elections, they might be more inclined to back some Republican proposals.

"Republicans will make changes. It's not a question of ‘if.' It's a question of how many," said James Capretta, a health policy expert with the conservative Ethics & Public Policy Center.

[Obama Las Vegas Flickr by Matt Cadwallader, Creative Commons licensed]