MS. DIANE REHMThanks for joining us. I'm Diane Rehm. The administration claims to have met its self-imposed deadline for fixing major issues with the website, healthcare.gov, but there is still a great deal to be done before the online federal insurance marketplace is fully operational. Joining me to talk about the Affordable Care Act rollout challenges and their political implications: Susan Dentzer of the Robert Wood Johnson Foundation and the PBS NewsHour, Louise Radnofsky of the Wall Street Journal, and Juliet Eilperin of The Washington Post.

MS. DIANE REHMPlease feel free to join us with your calls, comments, questions, 800-433-8850. Send us your email to drshow@wamu.org. Follow us on Facebook or send us a tweet. And welcome to all of you.

MS. SUSAN DENTZERThanks for having us, Diane.

MS. LOUISE RADNOFSKYThanks so much.

REHMGood to see you all. Juliet, Nov. 30 is past. The administration claims it has met its deadline. Talk about what's happened in the last five weeks or so leading up to this.

MS. JULIET EILPERINWe've seen a really unprecedented public/private partnership where the administration made the decision that it could fix the site, that it rely heavily on the existing federal contractors and federal employees who had been working on it for months, but that it would bring in a few key people, including Jeffrey Zients, who used to be the acting director of the Office of Management and Budget, who has considerable private sector experience.

MS. JULIET EILPERINHe came in to oversee the day to day operations. They chose one of the contractors, QSSI, to be the general contractor, to really kind of oversee all of the work, and they established a command center where they basically had a centralized decision-making, about two dozen employees, who'd really decide at any one time how quickly to fix problems that they were monitoring around the clock.

MS. JULIET EILPERINAnd so they've spent the last five weeks really working in shifts, 24 hours a day, to identify problems. They've fixed what they say is over 400 bugs in the system, considerably upgraded a number of kind of the hardware side of it, basically the storage capacity and how they could handle things, and were able to announce on Dec. 1 that they had fixed many of the problems, although certainly not all of them.

REHMWhat about the error rate? Have we seen that drop?

EILPERINThey have seen that drop. At one point it was as high as 6 percent in early October, and that is down to under 1 percent. It's at .75 percent. So that was one of the goals that they did meet, although it (unintelligible).

REHMAnd the average load time?

EILPERINThat was a speed goal that they failed to meet, though they didn't highlight that. But they said that they would get -- their internal goal, which The Washington Post reported, was to get it down to half a second, and they say it's under a second and would not specify exactly where it is. It looks like it's in between a second and a half a second.

REHMLouise, do you want to add to that?

RADNOFSKYWell, they announced more than a week ago that they'd got it to under a second, so hearing again yesterday that one of the big achievements was that it was under a second seemed to some people to be maybe a sign that they didn't have as much good news to report as they'd hoped. But the important thing to remember about the fix is that they have announced progress with -- or that they're mainly aimed at making the site look and feel better for users.

RADNOFSKYAnd certainly it's not as glitchy as it was. What they haven't said a lot about is progress with some of the back end problems, which are much more difficult to resolve and have really caused...

REHMLike what?

RADNOFSKYThere's a problem with identity verification. A lot of people are still getting stuck there. They said they started to make work on that over the weekend and that they think they've made some progress with it. There's also a really very big problem that they're still trying to figure out ways to solve involving the quality of the enrollment data that's going to insurers. Insurers say they're still getting inaccurate, duplicate information, missing fields in it, that sort of thing.

REHMSusan Dentzer, I gather the pages don't load quickly enough?

DENTZERYes. That's the case, although I think, just to build on what both Juliet and Louise have said, people should understand the exchange essentially has two functions. One is to interface with consumers. That is the front end. The back end is to get information to insurers about who signed up and also, very importantly, to get the subsidy dollars that eventually will flow to the insurers to help pay for coverage for people who are eligible for subsidies.

REHMAnd that back end is what's not working yet.

DENTZERIsn't built. And, in fact, I spoke this morning with someone in the insurance community who said there is "no evidence" that the function has been built to date. No evidence, right? So this is a really very serious problem. So users will -- consumers can go online, a much better experience. There are some problems with speed and so forth, but vast improvements there.

DENTZERThe back end now is emerging as a really serious problem.

REHMSo what's going to be done about getting that back end built? Who's doing it?

DENTZERAgain, it's a mix of the contractors that Juliet talked who are working on that in very close cooperation with the insurance community who are very interested in seeing this problem resolved and supportive of the administration's efforts to build it out. But they need it done fast because they really need subsidy dollars to start flowing. If they're going to start paying claims out in January on policies, they need those dollars in hand as of January.

REHMLouise, this has been such a scramble and such a long process. Why has it been so hard?

RADNOFSKYWell, a lot of people have asked why, in 3 1/2 years, the administration could be ready, but 3 1/2 years wasn't really the timeframe that they were working with. There were a lot of decisions leading up to this year that really essentially pushed all of the building work, the main building work, into this year, once the specifications had been set.

RADNOFSKYAnd we've reported that there were a lot of delays last year, both around the Supreme Court decision and around the election in which the administration didn't really want to put out key regulations that told people how to move forward because they were essentially trying to keep the law alive by not inflaming public opinion or indeed the justices opinion, but that did have a knock-on effect.

EILPERINRight. I think that that's absolutely part of it. You had those delays. I think, clearly, you had a flawed management structure, which is something everyone acknowledges. When you also look at, frankly, how they have made progress in the last five weeks, in many ways, it's a commentary on how difficult it was to manage this before, how it was not managed properly, and so that absolutely contributed.

REHMWell, explain that. Was it because of government procurement rules? What was it?

EILPERINI think there were a few different things. So one thing that has emerged is that the way that the government gets IT projects done is not the most efficient way, that you don't have all the -- particularly the most advanced players competing in that area because a lot of people, for example, in Silicon Valley, they're not inside the Beltway contractors. They don't even bid on these projects.

EILPERINSo I think that's part of it. Also, you saw this odd combination of, on one level, the centers for Medicare and Medicaid, the main agency within HHS that was managing it, you had rank and file employees who were doing things but not fully communicating problems to, for example, the higher ups, whether it's maybe an HHS or in the White House and, at the same time, the White House was heavily involved in managing some of the policy, which, again, hamstrung the folks who were working to put the system together.

REHMSo you've got this combination of bureaucratic problems. You've got this group of technical problems. So is the gap between the two now more narrow, Susan?

DENTZERCertainly, again, with respect to the front end, the combination of finally deciding to hire a general contractor, a so-called systems integrator, QSSI, as Juliet mentioned, was very important as part of the solution. And then, lots and lots of software fixes and hardware additions, more than 400 particular software bugs that had to be ironed out, this is all the kind of thing, by the way, that could've been done in advance of the standing up of the exchange had there been the decision not to launch the exchange until the systems were thoroughly tested and the bugs ironed out.

DENTZERAnd anybody who puts into place a very complicated IT system will tell you this is always what it takes and always what has to happen and it just didn't in this case.

REHMOK. So now, you've got Jeffrey Zients. You've got QSSI working to solve these problems. How long is Jeffrey Zients going to stay on?

RADNOFSKYUntil the end of the year, but he is supposed to start in January to head the National Economic Council, the person who the head of it right now, Gene Sperling, is slated to leave and has announced his intention to leave much earlier. And so really what Jeffrey Zients in the call with reporters yesterday is that he, you know, he is heads down on this, but plans to take up his new job and that the team will stay in place, which, while he didn't say QSSI, the assumption is QSSI and potentially some of the outsiders they've brought on will continue to work on it.

REHMBut haven't Republicans, haven't Democrats all said, you need kind of a czar to oversee the ongoing process, someone like Jeffrey Zients?

EILPERINOne of the things that's most frustrated lawmakers in the congressional hearings has been trying to figure out who they can blame for the problem and hearing from everybody initially that there was no one to blame and then starting to hear from a series of high ranking officials that each of them was willing to take full responsibility for it. It certainly lead to some confusion about who was in charge and Jeffrey Zients was designed, essentially, in his new role to meet that.

DENTZERThere's also a call, though, now among the insurance community, really, to require -- to ask the president to appoint a czar, somebody from the business community, ideally, is their dream, somebody who can take charge of the effort and take it out of HHS and the federal bureaucracy at this point and really fully adopt what the administration has sometimes said is we need private sector velocity. Well, the insurers say, OK, fine. Let's have not only private sector velocity, let's have a private sector management structure on this to get the job done.

REHMBut does that mean bring in Silicon Valley? Does that mean bringing...

DENTZERPotentially or….

REHM...brand new contractors?

DENTZER...or somebody who has headed a major IT enterprise or health insurance enterprise, just someone who understands what's involved here in getting all of this fully executed.

REHMSo does Jeffrey Zients want to get this off his plate, Juliet?

EILPERINWell, I don't know. He rarely -- you know, it's an interesting question. Maybe we need to raise that at the next conference call because he has not done one-on-one interviews with folks. But I'm guessing he's excited to take up his new job now that he has declared victory in his terms.

REHMJuliet Eilperin, White House correspondent for The Washington Post. Short break here. Your calls, questions, when we come back. Stay with us.

REHMAnd welcome back. Here, talking about the successful Nov. 30 deadline met by the administration as promised, Susan Dentzer. She's with the Robert Wood Johnson Foundation and on-air analyst on health issues for the PBS NewsHour. Louise Radnofsky, health policy reporter for the Wall Street Journal, and Juliet Eilperin, White House correspondent for the Washington Post, just before the break, we were talking about who or what might carry this whole process forward. What do you need, Louise?

RADNOFSKYTo carry this forward, you need somebody who's able to oversee it, but you also need to put that person in a place where they can do what they're doing without political concerns. One of the...

REHMWhat does that mean?

RADNOFSKYOne of the reasons that the standup of the president's signature domestic issue was being handled by the Medicare Agency was that folks knew at the time that they needed to shield it both from political scrutiny but also from the possibility that its funding might be cut off. So if you were to have a permanent team in charge of making this work, you'd need to find somewhere to house them where presumably they could still have a guaranteed source of funding, even if somebody in Congress might want to try and choke that off in the future.

REHMWhere might that be?

RADNOFSKYIt might have to be back in the Medicare Agency, which would be -- you know, has been problematic so far.

REHMSusan.

DENTZERYou know, where there's a will, there is a way. And we have seen certainly the administration find all kinds of workarounds -- notwithstanding various regulations -- to make this happen. I suspect we're going to see somebody emerge as a new team leader over the next months. And where that person is housed, nobody can say at this point but there will probably be somebody who comes onboard to take the lead in pushing this through.

REHMHere is a tweet from Glen: "Did anyone consider contacting bulk volume pros like those at Facebook, if only for consulting? Surely they could've helped." Juliet.

EILPERINWell, I mean, you did have a couple people, including Mikey Dickerson who's on leave from Google, who came on. And he's basically been one of the most important decision makers recently. But there are also again -- and they've brought in a few other folks. Gabriel Bird who was a key analytics person on Obama's campaign has also been working on this. But there are also limits.

EILPERINFor example, the CEO of SalesForce.com Marc Benioff, he offered to take it over, rebuild the entire site, and run it free for five years. And the White House turned down that effort -- offer. Both you can imagine particularly he's a big supporter and contributor to the president. And clearly there would've been incredible political blowback, to say nothing of kind of issues about (unintelligible).

REHMTo start at ground zero and go over the whole thing again, would that have been the smarter thing to do, Louise?

RADNOFSKYThe administration is focused on keeping the site up and running precisely so they can identify the problems with that. That's been quite a difficult then, especially over November when they were simultaneously trying to encourage a few people to come to the site but not too many and, of course, also very much aware that you didn't want to leave people with a bad impression.

RADNOFSKYSo you really only wanted the most dedicated people to be coming to the site. But you essentially did need them to act as the canaries in the same way that the insurers are now flagging a lot of the problems in pilot programs for the administration with the data site.

REHMBut now, given all the pressure against the Affordable Care Act, given all the forces almost pushing it to fail, has it done fairly well so far, Susan?

DENTZERWell, I think if we step back, we can see a couple of things that are part of the picture of reality here. One is a lot of people have been successful, whether going through state-based exchanges or directly through other state programs, in signing up, for example, for Medicaid. The Medicaid enrollment under the Medicaid expansion is running well ahead of the enrollment in private health insurance under the Affordable Care Act at this point.

DENTZERThat's clearly a benefit to many, many thousands of individuals. So we have that. We also have the case that a lot of people still independent of the exchanges are able to buy coverage that is in many instances more affordable and provides better coverage than what they had previously.

DENTZERI just talked to a small business person in North Carolina the other day whose broker brought him a policy that has a lower premium, a somewhat similar deductible, some changes, but essentially is a better deal in the small business market than what was available to him previously. So we can't neglect these successes of the law notwithstanding all the problems with the website.

REHMJuliet.

EILPERINYeah, absolutely. I mean, so I think the issue is that, you know, there is this disconnect. And what will be interesting in the coming months is, for example, if they can get the system to work successfully or basically come up with various workarounds that they're working on and they can get a broad enough risk pool of say roughly 7 million people, we could be here, you know, in the spring saying that this did work. But having these problems in the front end are really certainly challenging whether it can work a long time.

REHMLouise.

RADNOFSKYWell, one of the things you're hearing a lot of concern over is what premiums in the risk pools will look like for next year. We could be here in the spring looking at 7 million people coming in. We'd want to know -- and certainly the insurers would certainly want to know -- whether the main people who are willing to battle through the site, and especially in its early few months, were primarily people who knew they needed health coverage because they knew they were likely to incur high medical claims either for themselves or for their carrier.

REHMHere's an email from David, a question: "Doesn't anyone realize this is a huge event for America, something that will make our country so much better for generations and that something like that takes time to perfect and get the bugs out? Rome was not built in a day." Susan.

DENTZERWell, that's true. And, in fact, insurers will tell you they always viewed the exchanges as a two- to three-year rollout. They don't believe the exchange market is going to be mature for several years. What happens when you stand up anything like this, a lot of people get into the market. They underbid on premiums, what have you. Some people -- some insurers will pull out a year from now. Others will come in. It will be several years before that private insurance market really does settle out.

DENTZERAnd more broadly, of course, nobody expected -- the 7 million projection really was a guesstimate on the part of the congressional budget office about how many people would enroll. We still don't know how many people actually will be eligible for the Medicaid expansion. The variation and the predictions vary by a factor of two. So it will be a while before we see what really happens.

REHMHasn't the Medicaid enrollment exceeded all others?

DENTZERYes. Yes, it has, to date. And of course some of that, frankly, is people who already were eligible for Medicaid and didn't sign up previously, as well as people who are eligible under the Medicaid expansion.

REHMLouise, what about the federal website as opposed to the state websites? How are they doing by comparison?

RADNOFSKYWell, the state websites have really run the gamut of ones that are significantly outperforming healthcare.gov, and some that are underperforming and one that is not running at all yet in Oregon. And so what you've seen with the states is this variety of experience. But the states are also, in some ways, dependent on the federal technology, not so much healthcare.gov itself but other back end parts of the system, including the federal data hub.

RADNOFSKYAnd some of them have been affected too, and there have been -- when there's been system-wide maintenance, it's meant that the hub gets taken down. It's suffered from planned outages. It's also suffered from some unplanned outages. So it's driving some of those states that are doing really well for themselves a little bit crazy. And they're now trying to find ways to essentially uncouple themselves from that reliance so that they can continue to serve their residents around the clock.

REHMWhat about Oregon? Why hasn't it gone online yet?

RADNOFSKYThis is a really good question. Oregon was one of the states that was out there fastest among the states that were running their own exchanges most enthusiastically.

REHMAnd very pro, yeah.

RADNOFSKYIt's actually worth noting -- and I know you've had her on the show before -- Kentucky was considered in some ways to be one of the laggards among the states because they weren't out there talking a lot about how well they're doing. And we've seen that Kentucky appears to be doing extremely well in the state exchanges.

REHMQuite well. Is Oregon simply testing retesting, trying to get bugs out before it goes online?

DENTZERIt's a major rebuild but along the lines of what's been done with healthcare.gov.

REHMOh, I see.

DENTZERBut even Massachusetts, which had an exchange previously, is having problems with its new commonwealth connector or the new connector exchange in Massachusetts. So, as Louise says, there's an uneven experience across the country. California, by contrast, the exchange is functioning very, very well.

REHMAll right. Let's open the phones, 800-433-8850, first to Aaron in Indianapolis. You're on the air.

AARONHello, Diane. It's a pleasure to be on the air with you.

REHMThank you.

AARONMy question, I guess, kind of has a couple of parts, and I'll try to keep this brief. I wanted to ask about the politicism of the whole thing. One of your guests mentioned earlier that part of what has slowed down this rollout is the fact that the administration had to be very careful what details they reveal and when. And it seemed that they did that for fear of, you know, if the public found out exactly what this law was going to do they would demand that it be repealed.

AARONAnd then also, someone mentioned one of the success stories. And I wanted to just, in fairness, bring up some of the massive failures of the law in general. And I know in my own personal circumstances, the way everything stands now -- and I've had a professional agent I've been working with for years, who's gone over everything he can find out about the implications of Obamacare.

AARONI stand to lose a great deal of money in this. I'm not going to qualify for the subsidies because my employer offers a healthcare plan, but it's a plan that's unaffordable to me. And the law doesn't take that into consideration. I'm not going to be able to keep the plan that my family has currently been on. And so my insurance premiums, once this all goes into effect, are going to triple.

AARONAnd so I guess my final -- you know, my overall question is, are we sure really that this is the best thing for our country in the long term? And you mention that Rome wasn't built in a day. Well, Rome imploded at the end and caused hundreds of years of strife for pretty much the known world. So where are we going with all this? I know it's a really broad question.

REHMAll right, Aaron. Thanks for your call. Juliet.

EILPERINWell, I think one of the things our caller is eluding to, which is a legitimate issue, is the idea that part of the idea of this entire law was to provide more quote unquote "essential" benefits, that people would have more robust insurance packages. And by definition that's going to cost more. In some cases, they're going to be covered by subsidies but there are plenty of people who aren't going to get those subsidies for various reasons. They earn too much, et cetera. And for those people, they are going to see, you know, higher rates in some instances.

EILPERINAnd I think one of the interesting things is that the administration and the president specifically, while he's eluded to it in some speeches, it's not a central part of what they've been talking about. And in that way they're -- it's quite likely that there are Americans who have been unprepared for the idea that this is going to affect different Americans differently.

REHMLouise.

RADNOFSKYThis is a really important thing to remember about premiums. You're going to see some people who are getting premiums that are more affordable for them because perhaps they had a medical history that had meant that they were being charged more. And as a result, their premiums might go down a little bit, or they might be paying around the same but to get a more generous benefits package.

RADNOFSKYBut at the other end of the spectrum, people who are getting what was essentially a discount because insurers knew them to be in good health won't be getting that discount anymore. And so their premiums are going to be the same as the sick person's, and that's why they're seeing their premiums go up. So when -- in that sense it really depends on who you are as to what your experience is going to be.

REHMAnd you're listening to "The Diane Rehm Show." Is tripling of health insurance premiums a rather unusual scenario?

DENTZERWithout knowing more of the facts of that listener's situation, I would just say probably the best advice, if he's seriously interested in sorting this out, is to go speak with a navigator. It's unlikely that you would be found to have health coverage through your employer that was unaffordable to you and not be eligible for subsidies. Those two things just don't really seem to compute. So I would suggest a little bit more investigation before coming to a conclusion.

REHMAll right. To Marsha in Tampa, Fla. Hi there, you're on the air.

MARSHAHi, Diane. Thanks for taking my call.

REHMSure.

MARSHAI received an email last night from a Republican friend of mine who is -- it's a link to a YouTube video by a congressman Joe Barton from Texas. And he's grilling this Mrs. Campbell who represents the Affordable Healthcare Act. And he's telling her -- or he's asking her to explain the fact that there's something imbedded in the source code when you apply for the Affordable Healthcare Act that says you have no reasonable expectation to privacy.

MARSHAAnd he's saying that this is in direct violation of the HIPAA Law. And he's asking her to explain it. And she is telling him over and over that this is not in her bailiwick. This is above her jurisdiction. And he's just making a huge deal that even if you apply -- attempt to apply you -- all your information that you've, you know, put into the website will not be private.

REHMAll right.

MARSHAAnd I just wondered if your guests could explain that.

REHMJuliet.

EILPERINThis was an exchange that came up during the hearing before the Energy and Commerce Committee in late October. And it turned out that actually while again Congressman Barton was questioning this in depth, it was not really an accurate line of questioning, that essentially, while there was some of that line in the source code, this is not something -- for example, it's not like ordinary Americans would see that warning when it came to light.

EILPERINAnd in fact, the very privacy protections that are imbedded under the law and imbedded in the system is part of what makes it very difficult -- and I know Louise could probably talk about this -- for, for example, insurers to directly enroll people. That part of the issue is, because they don't want a lot of people getting access to this information, you have to go through the federal hub to verify things like income information.

EILPERINAnd so while certainly when you watch that, it was dramatic at the time, there aren't quite the same level of at least those privacy concerns that the congressman was (word?).

REHMSo are we suggesting here that that's being used as a deterrent to some people, that ad or that YouTube used as a deterrent to scare people off, Louise?

RADNOFSKYWell, you've certainly seen a lot of lines of attack on the law. And some of them have been more successful and stuck than others. You've certainly seen the canceled individual insurance policies run for several weeks now as a real major issue. Premium shock was certainly another that was being pursued. Privacy is something that has reared its head at various times and you've certainly seen people trying to push as a line of attack.

RADNOFSKYIt hasn't really stopped yet partly because the -- there have been some isolated incidents that have been reported so far but no one's really been able to show that there's a consistent privacy breach issue so far. It's certainly something that people who are concerned about this are looking for very closely.

DENTZERThere's also a big difference between protecting your health information independent of information about your income and so forth. And where the congressman misspoke was implying that any privacy breach would involve a breach of your health information. This is the kind of information that's contained in your electronic health records, for example. And none of that information is exchanged through the health insurance exchanges or HealthCare.gov.

REHMBut saying that...

DENTZERFrightens people.

REHM...and then pointing to that YouTube is going to scare people.

EILPERINSure. And I remember when, again, we were watching the hearing and when it was going on, this was something that we started investigating. And when you see a clip, you don't get the back story.

REHMJuliet Eilperin of the Washington Post. More of your questions, and we'll try to straighten out any myths that are out there. Stay with us.

REHMAnd welcome back to our discussion of the state of the Affordable Care Act when the administration promised that most of the bugs would be worked out of healthgov.com. No, it's...

DENTZERHealthcare.gov.

REHM…healthcare.gov and by Nov. 30. And here we are Dec. 2, and still, you know, one can argue -- some of them have -- there is improvement, but it surely isn't perfect. On the other hand, Katherine, in Springfield, Va. says, "God help the Department of Defense or any other government agency if any of the systems they had built by contractors are ever subjected to this level of public scrutiny.

REHM"I made a long successful career from fixing messes like this. The system was built by the lowest bidder. And this kind of cycle has been going on since computers ran on vacuum tubes and we punched holes in cards with stone chisels." Juliet.

EILPERINWell, that's interesting, although I do -- and while this is not my absolute area of expertise, my understanding is the Department of Defense has an ability to go outside the traditional contracting system and occasionally bring in some better folks at a higher price because they argue that it's a question of national security.

EILPERINBut I do think that -- I mean, it is worth keeping in mind that there's an extraordinary level of scrutiny that this system has been subjected to. I would argue, however, given that this is such a critical test for whether government can do what it says it can do, that certainly the administration was fully prepared for the idea that there would be an onslaught of scrutiny.

RADNOFSKYOne thing it's also just worth noting is that there were a couple of contractors that work often for the Department of Defense that were able to have bid for this contract to run the website, and they declined to do so: Lockheed Martin, for example. We've asked them to tell us why, and they've declined that opportunity -- and to confirm that they weren't interested in doing it.

DENTZERBut by the same token, CGI Federal, historically, has mostly done Defense Department contracts and came in to do this one. So that emailer's point is correct. The history of federal contracting around information technology is riddled with spectacular failures -- riddled. And ones that cost much more, by the way, including attempts by the IRS and others to install new computer systems. So the best that will come out of this, perhaps, is a very solid, substantial look at how we can prevent these kinds of IT-related disasters going forward.

REHMShouldn't that have been done first?

DENTZERNo question about it. No question about it.

REHMAll right. And here, Ernie in Seattle wants to know, "What's the status of the back end of the successful state exchanges like California and Washington?" Susan.

DENTZERThere is better information flowing from those exchanges to insurers. It has not been fully tested yet. And, of course, the ultimate test will be -- I think Louise made this point earlier -- even the states that have successful exchanges, are still dependent on parts of the federal system, particularly to make the subsidy dollars flow. And that's the piece that we haven't seen fully tested yet -- and won't see fully tested really until January.

REHMAll right. To Wayne in Greenville, N.C. Hi, there.

WAYNEHow you doing, Diane? I'm just a huge fan. Glad I got to talk to you, so.

REHMThank you. Go right ahead.

WAYNEYeah, I have a question -- well, kind of a question and a comment. I finally -- my wife has some preexisting conditions and wasn't able to get healthcare before the Affordable Care Act, so I'm a huge fan. But, when I went to sign up with -- I did use the website last night -- it did work fine, healthcare.gov. But I'm noticing in North Carolina there's no real exchange because North Carolina's one of the states that obviously dropped the ball and didn't do their own state exchange.

WAYNESo there's really only one -- when you go to the exchange, you're not comparing plans between multiple companies. You're comparing Blue Cross Blue Shield North Carolina's plans against each other. So there really isn't any competition. And the premiums seem high to me, I mean, you know, well, a lot higher. Sticker shock is something you talked about earlier, but it's something that I was really surprised about.

WAYNEThe only plan that really gave her any actual benefits was about $280 a month, which is, you know, I'm sure average. But I was surprised that there wasn't more subsidy and things like that. So I was just wondering, is there going to be a plan for maybe the states that don't actually have an exchange and only have one option? Are they going to be putting, you know, where they can nationally compete against other plans?

REHMSusan.

DENTZERI've sometimes compared where you end up on your premiums in the country to a kind of an elaborate bingo game, you know, bingo, you have sort of E6 and F5 and all of that. It depends on where you are in the country as to whether your state, as in the case of North Carolina, whether the states not only set up an exchange, but also whether the insurance commissioner used the authority that's in the law to negotiate rates with insurers, as well as how competitive the insurance market is in your state overall.

DENTZERSo, if your state is one in which one particular insurer has most of the market, which is the case in North Carolina with Blue Cross of North Carolina, where the commissioner did not take on the authority to negotiate rates very actively with the insurance company -- also the case in many states -- and the state did not have its own exchange and make a concerted effort to pull more insurers into the exchange. If you're in one of those states, you will be paying higher premiums, on balance, than states that decided to take an opposite tack.

REHMLouise.

RADNOFSKYThat's absolutely the case. There is one other thing to know though, which is that premiums are not necessarily lower in states that have all of those conditions in place. There's a somewhat complex relationship between the market and the decisions that people took. So, if you look at the Northeast, for example, premiums there are generally higher because the cost of medical care in the Northeast and indeed the cost of everything is higher there.

RADNOFSKYSo a lot of work, for example, on Connecticut's part to negotiate rates or generally just to make sure that they're running the best exchange they can, hasn't necessarily meant that their premiums are lower than North Carolina's. In fact, I'm pretty sure that they're not.

REHMJuliet.

EILPERINYeah, and I think that one of the interesting things is that the administration, when you ask them, for example, why the system -- the online enrollment system didn't work better, they said, "We were really focused on making sure there was competition in the states among insurers." And, again, they succeeded in some areas, didn't in others. But that was something they were aware of was going to be a problem, and they did focus on it in the months leading to the launch.

REHMThanks for your call, Wayne. Here is an email from Marylou in Rochester. She says, "The media really talked about the fact that 36 Republican governors refused to set up state exchanges. This is at least as important as computer glitches. This Republican lack of cooperation overloaded the federal website instead of states doing their share." Is that a fair complaint, Louise?

RADNOFSKYWell, it's certainly the case that the administration didn't bank on having to serve 36 states in its federally-run exchange. And it didn't know until late December of last year exactly which states would be coming in and, indeed until February of this year, quite how actively the states would be participating if they were choosing to involve themselves at all. That said, that deadline was set by the administration. There was a lot of running the clock out, hoping that states would change their mind. And there's not actually a scalability problem with the website.

RADNOFSKYYou can run it for a certain number of states or you can run it for a lot of states. That said, obviously, if it fails, then you're failing 36 states rather than the smaller number.

EILPERINAnd absolutely, I have to -- obviously I can speak best to our coverage -- but we have pointed out that that was a challenge for the administration. But that they -- and particularly the fact that there was mandatory funding, a mandatory funding stream for the state exchanges and not for the federal exchange -- so we made that very clear when we've described what's gone wrong. But there's no question this was a challenge.

REHMSo, clearly, Susan Dentzer, all of this has affected the president. His poll numbers have dropped to a very low point. And to what extent are they really tied to the Affordable Care Act and perspectives around the country?

DENTZERI think, very clearly, there's a very tight link. If you just look at the timeline for when the numbers really started to drop, it was after these enormous problems with healthcare.gov began to surface. And the only question is, now, does that turn around? Is there enough enrollment? Is there enough -- a change of perception?

DENTZERYou've obviously had a couple of viewers say they managed to find coverage that they found was better and affordable. Does that become the dominant story over the next six months? Or does it not become the dominant story? That is really, you know, we will have to see how it all plays out.

EILPERINYes. And one of the things that I think is interesting to watch in the coming weeks is that the administration is confident that -- where they can now move into another stage of this process where they do kind of grassroots organizing to get people enrolled. And they are more comfortable with that terrain and feel like that's what's going to help rebuild both the overall risk pool as well as the president's credibility. And I think we're just going to have to watch that in the coming weeks and see if they succeed.

REHMLouise, what about small business and the online exchanges? Why was that postponed for a year?

RADNOFSKYWell, that announcement came on Wednesday right before Thanksgiving in the afternoon. So some listeners may have been doing other things with their time than hearing him. Unfortunately, it wasn't -- but it's a problem for the administration because it represents their concession that they can't get an online exchange going for one side of the people they were trying to serve, the small businesses.

RADNOFSKYSo instead they've pointed to agents and brokers and insurers and said that small businesses can continue to work with them as they do already and that they can then try and get tax credits at the end of the year when they're filing for any plan that they select that would have been sold on the exchange. But it's essentially saying that can't get it done for a year.

RADNOFSKYAnd the reason they're giving for not being able to get it done for the year is that they were choosing to focus on the individual side of the exchange instead. In other words, it's just something that they had to toss overboard because they couldn't get it done at the same time as everything else.

REHMSo how is that going to affect the appearance of what's going on, Juliet?

EILPERINWell, certainly, it's not great when you delay at least for a year. And, you know, we'll see whether they can get it up and running, you know, this part -- particularly when you're talking about small business because, from a political standpoint, everybody -- all politicians love to say they're working on the part of small business. And often Republicans have exploited this in the past, and so, certainly, it is a major political issue.

DENTZERBut it's a little bit less damaging in the sense that almost all small businesses who do -- that do buy insurance now work through brokers and agents. So this isn't asking people to do things differently from what they normally did. It -- for a group of small businesses that might have just been newly testing the waters about offering insurance to their employees, it might be a bit of a setback. But there are plenty of brokers around to serve the small business community. And that's different from what is the case in the individual market.

REHMSusan, as you said earlier, the insurance companies have a big stake here. Explain the financial risks they face if only unhealthy people decide to buy these policies.

DENTZERThat's right. It's been known for some time that the people most likely to sign up quickly would be people who have preexisting conditions. Those have been the people frozen out of the market. If that -- those risks of unhealthy people can't be offset with younger people coming into the coverage and paying premiums, then what will happen is that the insurance companies will be stuck paying out lots of claims. And they may decide that their premium forecasts, their pricing, was in error. There are several programs in place to protect insurers against this eventuality.

DENTZERThose were built into the law. One of them is something called risk corridors. Insurers are now worried that, if it turns out that they have too many unhealthy people, and can't offset that risk with money from less -- from younger, healthier people, that they will essentially need some additional assistance through this risk corridor program from the federal government. And so those discussions are underway now.

REHMAnd you're listening to "The Diane Rehm Show." Let's go now to -- I see that Steven in Collinsville, Ala., you've been waiting for a while. You're on the air.

STEVENCokie Roberts -- actually, the point this morning and a part of the problem was, her word, blindsiding by the governors across the nation. I live in Alabama. Also in South Carolina, I think, Gov. Nikki Haley refused to take the exchange and help implement the problem. These two states are in the Southeastern Conference Football Championship this coming Saturday. Trey Gowdy is a Baptist Christian in Spartanburg, S.C.

STEVENHe attends the First Baptist Church where Billy Graham is also a member. Here, in Alabama, our Gov. Bentley is a Baptist Deacon. So the question is, what is the healthcare plan for these people, for the mostly people of color, black athletes who will be on the field this Saturday? You can look at Jadeveon Clowney of Rock Hill, S.C. (unintelligible)...

REHMOK. I'm going to stop you right there. OK. Louise.

RADNOFSKYWell, there was, with the state-run exchanges, an issue that the people tried to sort of see a silver lining in governors refusing to set them up. They argued that, if the governor didn't want to do it, it was probably better that Washington did because they had more of an incentive in making it work. So that's one thing to bear in mind there.

DENTZERBut it has been very -- it has been ironic. Gov. Bentley was one of the premier champions of exchanges. He was intent on setting one up, until he got the word from Republicans at large that this was essentially a way of condoning the Affordable Care Act. And that's why Alabama elected, eventually, not to set up an exchange.

RADNOFSKYAlthough, to be fair, there are also some Democratic-run states that are not fully running their own exchanges, including Illinois.

REHMIndeed.

RADNOFSKYAnd they were working in partnership with the federal government. But, in their case, there seems to be a recognition, too, that they didn't know how to do it themselves or didn't think they could get it done.

REHMAll right. Final question: What about the Supreme Court decision to hear the case that centers on whether insurance plans must include coverage for contraceptives?

EILPERINWell, certainly, we will be watching that. That'll be an -- it's an important religious liberties question. Obviously, people -- administration feels very strongly that they've reached a compromise that both protects religious liberties as well as, for example, the right that women have to have access. But, given this court, it's certainly unclear how they're going to rule. And that will affect some of the -- ultimately, some of the benefits people could receive.

DENTZERI guess the only good news for proponents of the Affordable Care Act is it will not strike at the heart of the law the way the prior court case did. It would simply pertain to whether the essential benefits package has to include contraceptive coverage that, in turn, has to be offered by employers who have religious objections.

REHMAnd with this court, do you believe that anything could happen?

DENTZERI think we all learned our lesson with what happened the first time around, back a year ago.

REHMSusan Dentzer of The Robert Wood Johnson Foundation and the PBS NewsHour, Louise Radnofsky of The Wall Street Journal, Juliet Eilperin of The Washington Post, thank you for all your questions, your comments, and thank you for being here to answer them. Good to see you all. Thanks for listening. I'm Diane Rehm.

ANNOUNCER"The Diane Rehm Show" is produced by Sandra Pinkard, Denise Couture, Susan Casey Nabors, Rebecca Kaufman, Lisa Dunn, Daniel Knight and Alison Brody. The engineer is Erin Stamper. Natalie Yuravlivker answers the phones.