US

700,000 Obamacare Sign-ups Already Dropped Their Coverage

Obamacare administrator Marilyn Tavenner admitted that several months after the open enrollment period ended, the number of paying customers has dropped precipitously. 

By August 15, over 700,000 of the administration’s initial “sign-ups” had dropped their Obamacare coverage, Tavenner said in testimony to the House Oversight Committee. The administration has been advertising 8 million sign-ups since the first enrollment period ended in April.

Upon questioning, Tavenner had no details about the reason for the sharp drop, but presumably a large number of the sign-ups failed to ever pay their premiums, as many experts had predicted.

By August, that number does not include the several hundred-thousand-strong that had eligibility problems and will only be dumped from their health coverage on September 30. The Obama administration only just finished verifying the citizenship and immigration statuses of first year Obamacare sign-ups. (RELATED: Obama Admin Is Kicking 115K Off Obamacare Plans)

The administration will kick another 115,000 customers off their coverage on September 30, after those ineligible customers have been receiving benefits, and possibly tax credits, for up to nine full months. That brings the total number of paying Obamacare customers down to less than 7.2 million at the end of the month.

The vast amount of nonpaying customers presents a serious problem to doctors and other health care providers. The Affordable Care Act requires that Obamacare sign-ups be able to receive health care for at least 90 days, even if they haven’t paid. For the first 60 days, the insurance company is required to eat the cost of the unpaid coverage; for the final 30 days, doctors are forced to provide the free health care.

“The system we have today is an incredibly easily-gamed system,” Rep. Issa said. “700,000 people got a free ride.”

Tavenner said she had no detailed information on the number of people who never paid or received taxpayer subsidies for their coverage and would not provide a time-frame to the Oversight Committee for when CMS would be able to release detailed information.

Follow Sarah on Twitter