A Tough Road Ahead for Sylvia Mathews Burwell

Sylvia Mathews Burwell, director of the Office of Management and Budget, is expected to be nominated to succeed Kathleen Sebelius as U.S. health secretary. Burwell will have her work cut out for her as the department prepares for the second round of Obamacare enrollments and tries to improve the process and avoid the initial glitches of healthcare.gov. 

"Even with the departure of Ms. Sibelius, Obamacare will still of course be the No. 1 target for any Republican during campaigning for November midterm elections,"said Mike Trilli, senior analyst in Healthcare Insurance at Aite Group. "However, it's not all bad news for health insurers. More than 7 million people have now registered in health insurance exchanges as of March 31.This enrolment target seemed impossible, even at the start of the year. In addition, 3.1 million people are estimated to be covered on their parents’ health plans, and many more are gaining coverage by Medicaid's increasing operational growth. However, it feels like insurers are seeing only part of the commercial success they should be enjoying at this point and everything achieved is still only a staging post to what could be achieved."

Burwell will work with health insurers as they file 2015 Obamacare prices at the end of May. In early March Sebelius said that while premiums for health plans sold on the exchanges would rise next year, the increases would be “far less significant than they were before the passage of the Affordable Care Act.” However, insurers have warned of double-digit increases in monthly premiums to make up for a higher proportion of older policyholders who often cost more to cover, and Burwell will be the one dealing with this. At the end of March, WellPoint Inc. predicted it may ask for “double-digit plus” increases.

In California, WellPoint Inc. is leading companies that have poured $13.4 million into defeating a ballot initiative that would give California regulators the power to reject increases in health policy premiums. Health insurers stand to lose control over raising rates in the most populous U.S. state at a time of dramatic growth in the customer base.

Also see WellPoint Leads $13 Million Battle on California Insurance Rates

"Sylvia Mathews Burwell will replace Ms. Sibelius, but does it really matter?" Aite's Trilli said. "What we need now is for the Affordable Care Act to not face further delays, further technical failings, or further damage from two political parties going head to head continually. We have now in effect an 'ACA Lite', partly a success, but a long way from its true potential to truly help Americans, and also boost the insurance industry that supports them. So effectively, it's not now down to the health secretary, but to Congress to stop the delays, allow implementation of ACA and let us have the real-deal on ACA.”