The Trump administration's cuts to Obamacare's advertising and outreach funding will lead to at least 1.1 million fewer people signing up for Obamacare this year, according to a pro-Obamacare group.
The Obamacare enrollment group Get America Covered released the analysis Monday a few weeks before open enrollment starts on Nov. 1. Critics have claimed that the Trump administration's ad cuts are part of an effort to sabotage the law, while the administration claimed it is trying to spend money more efficiently.
The Trump administration said it will cut ad funding to $10 million for 2018 open enrollment, down from $100 million last year.
"A minimum of 1.1 million fewer people will enroll in the federal exchange solely because of the administration's drastic cuts to Open Enrollment outreach," Josh Peck, an Obama administration veteran, wrote on the website Medium Monday. "Keep in mind, this is the least harm the administration's outreach cuts could have — this is a best case scenario. It assumes they spend the $10 million they have budgeted well and that nothing else the administration has done will impact enrollment."
Peck, who was in charge of the ad spending during the Obama administration, said that analysis doesn't consider other factors like consumer confusion around the fate of Obamacare, or the end of insurer payments.
"The Department of Health and Human Services closely measured the impact of outreach during previous open enrollments so we have a clear understanding of how effective advertising is at driving enrollment," Peck said.
Peck estimated that a majority of the $10 million left in the promotion budget would be spent on search advertising, which are ads that pop up when you search "health insurance" on the Internet. He said search ads alone were responsible for 25 percent of outreach driven new enrollments.
The Trump administration's HHS has said there would be no TV or radio ads for Obamacare because Obamacare is in its fifth open enrollment, and awareness is already high.
Peck estimated that email and phone outreach would be 85 percent as effective at getting Obamacare customers to renew coverage. Most of that would be attributed to limits of phone outreach. But he said it would be even harder to get new customers.
"For new consumers, I'm assuming that email and phones will be 60 percent as effective as last year," he wrote. "This is a bigger reduction, but without TV and the bulk of the digital ad budget, there will be far fewer people receiving emails and phone calls this year."
Peck said the estimate didn't include other factors such as President Trump's decision to end payments to insurers to reimburse them for lowering out-of-pocket costs for low-income Obamacare customers. The nonpartisan Congressional Budget Office has estimated that decision could lead to another 1 million drop in signups next year.
About 12.7 million people signed up for Obamacare for 2017 and 10.3 million paid their premiums as of March, according to federal data.
HHS responded that massive ad campaigns, like the one last year, did not lead to gains in enrollment.
"Last year, fewer Americans bought Obamacare coverage despite the previous administration nearly doubling the advertising budget," HHS spokesman Matt Lloyd told the Washington Examiner. "More marketing will not convince Americans to sign up for failed coverage they cannot afford or that does not meet their needs."
While the Obama administration aimed to spend $100 million during open enrollment, the Trump administration cut that funding by $5 million at the end of enrollment in January.
In 2015, the Obama administration spent $51.2 million and only 9.6 million bought coverage on healthcare.gov, which is used by residents in 39 states and the District of Columbia to buy Obamacare plans, an administration aide said.