Only 1/4 of estimated number eligible for subsidized, private health insurance through Kynect have signed up for it

While 85,000 people are covered by private health plans through Kynect, that's only one-fourth of the 340,000 that state officials estimated would be able to buy subsidized coverage through the state insurance exchange. That "underscores some of the challenges" of the federal health-reform law, Abby Goodnough reports for The New York Times, in the latest of series of stories using Kentucky as a bellwether for Obamacare.

"People earning between 138 and 400 percent of the poverty level — between about $16,000 and $47,000 for a single person — can get subsidies to help with the cost," Goodnough explains. "Even with that incentive, only about 76,000 Kentuckians signed up for these plans in 2014 and have renewed the coverage for next year. Since the enrollment period for 2015 began on Nov. 15, an additional 9,000 people have selected exchange plans."

2015 is the first year taxpayers will have to report on tax returns whether they had health insurance in the prior year. Unless they qualify for one of about 30 exemptions, mostly involving financial hardships, the health-reform law requires them to pay a penalty: $95 per adult and $47.50 per child, or 1 percent of the family’s modified adjusted gross income that is over the threshold the requires it to file a tax return. The penalties will increase next year, but for most people will remain below the cost of insurance, so many are expected to pay a penalty.

Kentucky is considered one of 13 states where people in the individual insurance market are better off under Obamacare than they were before, and compares well with other states, so why are so few getting coverage? "National polls have found that many people simply consider the exchange plans unaffordable, even with subsidies," Goodnough notes. Several thousand Kentuckians signed up for coverage but didn't pay the premiums.

David Elson gets dialysis. (NYT photo by William DeShazer)

One was David Elson, who "decided he could not afford the $350 monthly premium for a plan that included his doctors," Goodnough reports. "His poor health got worse, and in October, he landed in the hospital with end-stage kidney disease."

That enabled him to get special Medicare coverage for dialysis. But Elson, 61, of Louisville, told Goodnough, “The president gets up there and says, ‘We’ve got to get affordable health care for our people. It’s not.”

While Kentucky's private-plan enrollment is probably more modest than most states because it has more people living in near-poverty, the unwillingness of the near-poor to spend money on health insurance — something many of them have never or rarely done — may be the greatest long-term challenge to the new health-insurance system.

"Supporters say the private insurance exchanges will need robust business, including young and healthy customers that help balance the cost of sicker ones, to thrive," Goodnough notes. But her story also looks at people like Amanda Mayhew, 38, of Louisville, whose income is low enough for her to get free Medicaid coverage: "She has been to the dentist five times to begin salvaging her neglected teeth, has had a dermatologist remove a mole and has gotten medication for her depression."