With widespread confusion about the Affordable Care Act, commonly referred to as Obamacare, you might expect that those charged with explaining the health-reform legislation might be very busy these days. The federal government spent $67 million over the past few months to line up 105 organizations to serve as “navigators” for Obamacare. These navigators are charged with helping uninsured individuals enroll in health-insurance plans on exchanges that are slated to be operational in a little more than a month.
These navigators might not make as big of an impact as hoped for, though, if a recent survey by HealthPocket is on target. The company conducted an online survey across more than 100 websites in early August. Of the 1,150 responses, only 3% indicated that they would look to Obamacare navigators for help. Does this survey finding indicate that the Obamacare navigators might sit around twiddling their thumbs?
Not really. Here’s why.
More to the story
We first need to better understand who these navigators are. For the most part, they’re non-profit organizations that already serve the residents of their respective states. Quite a few hospitals, universities, and local United Way organizations are included in the mix. South Carolina even has a Chamber of Commerce as an Obamacare navigator. A church is reaching out to uninsured individuals in the impoverished Mississippi Delta region.
The question presented to participants in the survey (“During Obamacare’s first Open Enrollment Period, where will you get advice regarding your health insurance selection?”) might lead you to view navigators as something like a help desk to go to if you have questions. However, they won’t just sit back and wait for people to come to them. The role of the navigators includes proactively informing uninsured individuals about their options with Obamacare.
Survey winners
I suspect that the low percentage of individuals stating that they will seek help from Obamacare navigators doesn’t necessarily mean much. However, other findings from the recent survey could be encouraging for a handful of companies.
For example, 14% of respondents said they would get information about health-insurance options from their doctor or pharmacist. That figure amounts to more than 40% of the survey participants who think they will purchase new health insurance. This is good news for CVS Caremark Corporation (NYSE:CVS) and Walgreen Company (NYSE:WAG).
Walgreen Company (NYSE:WAG) was among the first organizations to step forward in helping promote Obamacare awareness. In early July, the big pharmacy chain teamed up with the Blue Cross Blue Shield Association to educate consumers about health reform. The two partners operate a website with information about Obamacare. Walgreen also said it will provide informational brochures in most of its stores.
CVS Caremark Corporation (NYSE:CVS) wasn’t too far behind. Later in July, the company announced that it also will launch an initiative to help inform consumers about health reform. CVS said those efforts would include “retail events and brochure displays” at its retail pharmacies and MinuteClinic locations. The company also planned to invite navigators into its stores to help customers enroll on the online exchanges.
The HealthPocket survey also found that 11% of overall respondents (nearly a third of those likely to purchase insurance) will look to the Internet to obtain information about Obamacare. This should be a positive for eHealth, Inc. (NASDAQ:EHTH), which recently won a contract to support enrollment on federal exchanges through its website. The company is hoping to participate in some of the state-operated exchanges as well.
WebMD Health Corp. (NASDAQ:WBMD) could also be a beneficiary. The company is already a primary Internet source for health information for millions of Americans. WebMD recently launched a comprehensive online guide to help consumers understand Obamacare.
Foolish take
It’s easy to see survey results and jump to conclusions that might not be on target. However, it’s also easy to leap to the wrong conclusions in investing matters. Just because CVS Caremark Corporation (NYSE:CVS), Walgreen Company (NYSE:WAG), eHealth, Inc. (NASDAQ:EHTH), and WebMD Health Corp. (NASDAQ:WBMD) might benefit in some ways from helping consumers understand Obamacare, that doesn’t automatically make them solid investment choices.
I think CVS Caremark Corporation (NYSE:CVS) and Walgreen Company (NYSE:WAG) could be good stock picks because of overall health trends and their business models. Any benefits they receive from helping educate about health reform are nice but don’t by themselves make for a compelling reason to buy the stocks. Navigating Obamacare is fine, but finding the way to solid earnings growth is even better.
The article Will Obamacare Navigators Just Twiddle Their Thumbs? originally appeared on Fool.com and is written by Keith Speights.
Fool contributor Keith Speights and The Motley Fool have no position in any of the stocks mentioned.
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