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Image source: White House on Flickr.

The holiday season is about giving and spending time with family and friends. It's also about enrollment in health insurance, as the Patient Protection and Affordable Care Act (better known as Obamacare) opened its doors to consumers for the third time.

Ready or not, here comes change!
There are a number of changes consumers are faced with this year, which has become something of a theme for this dynamic law.

First and foremost, consumers are expected to adjust to premium shock in select states. The Kaiser Family Foundation analyzed the price movement of benchmark plans (i.e., the second-lowest cost silver plan before tax credits) in 49 major cities across the U.S., encompassing all but one state, and discovered that benchmark premiums were expected to rise by a whopping 10.1% in 2016. There's concern that consumers not receiving financial assistance may have difficulty absorbing such a large increase.

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Image source: Flickr user Sebastiaan ter Burg.

We also have the dynamics of the full employer mandate implementation at play. Employers with 50 or more full-time-equivalent employees will be required to offer health coverage, and potentially subsidize that coverage, for eligible employees. Failing to do so could entail fines of as much as $3,000 per worker for businesses. It remains to be seen if businesses eat these extra costs, pass them along to consumers, or simply reduce hours and/or lay off workers to keep their costs down.

Even the enrollment dates have changed. For the 2015 calendar year, consumers could enroll between Nov. 15, 2014 and Feb. 15, 2015. The official reasoning behind the mid-November start was so consumers wouldn't be distracted by midterm elections. This year, enrollment began 15 days earlier on Nov. 1, and it'll end 15 days sooner on Jan. 31, 2016.

Two stunning Obamacare enrollment statistics
Last week, the Centers for Medicare and Medicaid Services released its latest update on HealthCare.gov, the federally run exchange that accounts for more than three dozen states. The data, which offered our first glimpse at a state-by-state breakdown of enrollment through week four, was nothing short of stunning. Here are two standout Obamacare enrollment numbers through nearly the first month of open enrollment.

Florida Pixabay
Image source: Pixabay.

1. Florida accounts for more than a fifth of early open enrollment on HealthCare.gov
In total, HealthCare.gov represents 38 states on its exchange marketplace, with the dozen other states, including New York and California, operating their own state-run health exchanges. What's really noteworthy, based on the initial enrollment breakdown by state, is that Florida, a state whose residents boast one of the highest median ages out of the 50 states, has signed up the most people by a mile.

Total enrollment on HealthCare.gov through week four equated to 2.04 million, with Florida enrolling nearly 445,000 people by itself. The next closest state was Texas with just shy of 225,000 enrollees. All told, Florida's contribution is just shy of 22% of all HealthCare.gov enrollees in the early going. 

Age very well could be playing a part in these figures. As we get older, our likelihood of needing medical care rises, so it only makes sense for Florida residents to proactively purchase health insurance. It may not be the oldest state in the country, but as one of the most populated, it may explain the early enrollment surge. Private players such as Florida Blue, Florida's largest insurer, as well as smaller but publicly traded players like Aetna, which sought a substantial premium price hike within the state, may be benefiting from this early surge in enrollment.

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Image source: Covered California.

2. Obamacare enrollment is down 17% from week four last year -- and that's OK
Here's a figure that might knock your socks off: after enrollment figures were up by nearly 20% from the prior year as of week three, Obamacare's HealthCare.gov enrollment of 2,040,430 is now down 17% from the cumulative 2,486,000 enrolled through week four last year for calendar year 2015. That's a sizable drop that would potentially make you think something is wrong; but in reality, everything is A-OK.

Remember how we discussed the shift in enrollment dates for the current enrollment period? This is a perfect example of that shift having a profound effect on Obamacare's year-over-year enrollment comparisons.

Health-benefit providers need two weeks to completely and accurately process online consumers' applications. This is why we see insurance companies cut off applications for an upcoming month on the 15th day of a current month. For example, if you want your coverage to begin on Jan. 1, 2016, you need to select a plan by no later than Dec. 15, 2016. If you miss that date, you have until Jan. 15, 2016 to enroll for your coverage to begin on Feb. 1, 2016.

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Image source: Flickr user Dafne Cholet.

Last year's open enrollment began on Nov. 15, 2014, allowing consumers precisely one month to enroll before the deadline to have health insurance coverage start at the beginning of the year. Enrollment this year began on Nov. 1, 2015, giving consumers an extra 15-day buffer to enroll. We've witnessed before that consumers are procrastinators, thus with no sense of urgency for another week or two enrollment remained subdued this year as opposed to last year.

Furthermore, the automatic renewal of health plans that's scheduled to occur later this month plays a big role in boosting enrollment. Last year, some 3.93 million people signed up the week of the January deadline, which is also the same week when automatic renewals activated. It's expected that we'll see a similar surge in the week six and seven totals this year.

Points to consider
The early indication would seem to be that more people are on track to enroll in Obamacare in 2016 than last year. This would bode well for the Congressional Budget Office's prediction of 10 million paying members by the end of 2016. Also, remember that the aforementioned numbers only include the 38 states covered by HealthCare.gov. Enrollment figures from California, New York, Washington, and nine other states are expected to add nicely to HealthCare.gov's 2.04 million enrollees.

The one potentially concerning figure, in my eyes, remains the year-over-year drop in window shopping on HealthCare.gov. Urgency is what breeds interest, and consumers do have an extra 15 days to shop around for insurance in the upcoming calendar year. However, the drop in consumers looking at plan options may be indicative of pricing concerns, which would be a bad thing. Alternatively, it may also signal that more people are getting health insurance though their workplace, which would be a neutral or good thing. It's a bit too early to tell either way.

With UnitedHealth Group currently unprofitable on Obamacare's exchanges and considering an exit as soon as 2017, it's really worth paying attention to the dynamics of the 2016 enrollment period as both as consumer and investor.

Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.

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