What D.C. lawmakers aren’t asking about ObamaCare

The House Energy and Commerce Committee wants answers. According to a June 3 letter from committee leaders to U.S. Department of Health and Human Services Secretary Kathleen Sebelius, lawmakers are seeking details on how and why several state-run health care exchanges have failed. They want to know why the administration awarded more than $1 billion...

The House Energy and Commerce Committee wants answers. According to a June 3 letter from committee leaders to U.S. Department of Health and Human Services Secretary Kathleen Sebelius, lawmakers are seeking details on how and why several state-run health care exchanges have failed. They want to know why the administration awarded more than $1 billion in taxpayer dollars to seven states – Massachusetts, Maryland, Oregon, Nevada, Hawaii, Minnesota, and Vermont. And furthermore, why those failed or faltering exchanges now need even more taxpayer dollars.

In addition to the important answers they are seeking, committee leaders should explore how much states are spending per ObamaCare enrollee. To build the federal website, fund state-run health insurance exchanges for some states, and facilitate marketing and outreach, the federal government is already slated to spend more than $6 billion.

These federal funds equate to more than $700 for every person who “selected” a health-exchange insurance plan. But that number – if one accounts for who has actually paid and who was previously uninsured – could be closer to $3,000 depending on how many have indeed paid for coverage. Meanwhile, the federal government continues to dole out money to the states.

In Illinois, for example, federal funds paid for “outreach” and marketing.  The total spent, based on federal grant award totals reported by the Centers for Medicare & Medicaid Service, or CMS, was almost $155 million. That means that, when the state’s share of the potential $677 million tab for the federal website is included, taxpayers spent between $800 and $1,600 in “acquisition” costs for each state resident who enrolled in an ObamaCare plan. Again, the exact amount will depend on how many Illinoisans ultimately pay for coverage.

New York enrollees, based on the CMS federal grant data, will cost taxpayers $1,400 per enrollee for the combined cost of establishing a state-based exchange website, plus outreach and marketing. California, which led the nation in enrollments and runs its own exchange, comes in at about $870 per enrollee. Hawaii, which had the lowest number of enrollees in the country, could cost taxpayers about $24,000 per enrollee.

Not only is this well above what the private sector might pay to acquire a customer, some of these figures are well above what the actual health insurance coverage itself might cost. While there is no apples-to-apples cost comparison available, given the nature of the health insurance exchange product, it is worth noting the private-sector acquisition costs for other products.

For example, priceline.com spends about $7 to acquire a new customer. Barnesandnoble.com spends $10. While these are very different products, the per-customer spending on ObamaCare – whether through healthcare.gov or state-run insurance exchanges – deserves further scrutiny and congressional attention.