“Unsatisfying To The Media And Republicans”: Surprise, Obamacare Now Projected To Cost Hundreds Of Billions Less Than Expected
Amidst the dark skies of the Healthcare.gov launch, some daylight may finally be emerging with respect to one of the critical goals of the Affordable Care Act—bending the cost curve of America’s expensive healthcare system.
According to a New York Times report out Tuesday, the Congressional Budget Office has quietly removed hundreds of billions of dollars from the projected costs of Obamacare, primarily the result of an anticipated decrease in the federal government’s contribution to the Medicaid expansion program along with the projected cost of the subsidy payments to those buying private insurance policies on the healthcare exchanges.
Why the good news?
The more favorable projections are the direct result of the slowing trend in the growth of healthcare spending over the past five years leading to a slowdown in rising costs. While, ten years ago, per-capita spending on healthcare had been growing by an average annual rate of 5 percent, that number was dramatically cut to 1.8 percent during the 2007-2010 period and reduced even further to 1.3 percent in the years following 2010.
Do we have Obamacare to thank for this highly successful “bending” of the cost curve?
Naturally, the answer depends upon who you ask as there simply is no definitive way of knowing—yet.
While most economist believe that the lion’s share of the reduction is due to the sluggish economy—making Americans far more careful when it comes to making decisions regarding when or if to spend money on medical care—others believe that some of the plans built into the ACA designed to get people to spend less may actually be working.
Among Obamacare inventions that do appear to be paying off in lower healthcare costs is the government’s refusal to pay hospitals more when patients are re-admitted within 30 days of their initial discharge. Additionally, new plan designs engineered to reward providers for quality of care rather than for quantity of care may well be paying off in terms of lowering the overall cost of care.
According to the Kaiser Family Foundation—widely regarded as an honest, non-partisan broker when it comes to healthcare issues and analysis—the declining increases in the cost of healthcare is 75 percent the result of economic factors and 25 percent a benefit of the cost cutting measures in the ACA that do, in fact, appear to be working.
Of course, the big question is whether or not these cost lowering provisions of Obamacare will continue to do the job once the economy regains its more typical trajectory.
There are reasons to be hopeful that healthcare spending can be held down once the economy kicks into higher gear.
For starters, while many Americans shopping for new health insurance policies may be decrying the higher deductibles they are discovering in the new offerings, higher deductibles should have a meaningful impact on the decisions people make when determining whether or not a visit to the doctor or agreeing to a given procedure is really necessary. While a $250 deductible will likely not cause a patient to ask how much a suggested CT Scan is going to cost, a $3,000-$5,000 deductible is far more likely to cause the patient to ask a few more questions and make more focused decisions when payment for the test is coming out-of-pocket.
Not surprisingly, there are no shortage of economists and pundits who believe that the ACA will prove inadequate to the task of controlling costs once the economy is in better shape.
Others are more hopeful, believing that the slowdown in costs are very much a result of hospitals and insurance companies understanding that something had to change given the unsustainable trends in rising costs. As a result of a desire to derail out-of-control costs before the costs derailed them, insurers and hospitals became involved in substantial systemic revisions designed to lower healthcare spending even before the government required them to do so.
Discussing whether the current decreases can last when previous periods of cost-curve bending did not, Annie Lowrey writes in her New York Times piece—
“This time may be more durable. Insurance and hospital executives in Massachusetts, Illinois and California, among other places where reforms have gone the furthest, report a consensus that spending growth had become unsustainable, and that expectations that Washington would force changes to the system spurred them to make changes themselves.”
If this is true—and I believe the evidence reveals that it is—these self-imposed changes, in tandem with the changes brought about by elements of Obamacare that don’t receive nearly as much attention as the more hot button issues, may prove to provide lasting changes to the system; changes that will point our cost trajectory in the right direction.
Like most elements of the Affordable Care Act, these issues and results only go to prove that far more time is required before we can even begin to measure the real benefits or detriments of Obamacare.
While this reality may prove unsatisfying to the media, politicians and those in the public who are so emotionally committed to the failure and ultimate death of Obamacare—whether for political purposes or only so that the opponents can experience the satisfaction of having been right—anyone interested in realistic measurement of this dramatic change in our system better settle in for the long run.
It’s going to be awhile until we know how this story ends.
By: Rick Ungar, Op-Ed Contributor, Forbes, December 4, 2013
“Brazen Dishonesty”: California GOP ‘Reaches For The Bottom’
Health care policy can get confusing, even for policy experts who study the details for a living. It’s one of the reasons dishonesty in the political debate surrounding health care is so damaging – even the most well-intentioned people often don’t know how best to separate fact from fiction.
It’s why efforts from political officials – who know better – to deliberately confuse people are so disappointing. Michael Hiltzik reports:
Opponents of the Affordable Care Act never stop producing new tricks to undermine the reform’s effectiveness. But leave it to California Republicans to reach for the bottom. Their goal appears to be to discredit the act by highlighting its costs and penalties rather than its potential benefits.
The device chosen by the Assembly’s GOP caucus is a website at the address coveringcaliforniahealthcareca.com. If that sounds suspiciously like coveredca.com, which is the real website for the California insurance exchange, it may not be a coincidence.
In theory, this is a site created by California Republicans to serve as a “resource” for those looking for additional information. In practice, the site “is worse than useless” – it didn’t direct users to the in-state exchange marketplace, and includes demonstrable falsehoods intended to deceive the public.
Like what? The site includes the ridiculous notion that the Affordable Care Act increases the federal budget deficit, which is the exact opposite of reality. It also claims the IRS will use the law to target conservatives; it says the law will discourage private-sector hiring; and it even hints in the direction of the death-panel smear by raising the specter of “rationing” for the elderly.
All of these claims are wrong. All of them are presented, however, on a website that presents itself as objective and non-partisan.
Stepping back, dishonesty on this scale is certainly brazen, but it raises anew a lingering question: if the Affordable Care Act is so awful, and will be as horrific as critics claim, why do Republicans continue to feel the need to make stuff up? Shouldn’t reality be damaging enough?
By: Steve Benen, the Maddow Blog, December 4, 2013
“When The Worm Turns”: Republican Fallacies On Obamacare, The Greatest Hits
Before the holiday spirit makes Republican-bashing a little unseemly, it’s time to get in a last ornery blast at the party’s Obamacare stance. Republicans have enjoyed themselves immensely during the Affordable Care Act’s bungled rollout, but most of the claims they’re making are preposterous and phony. Since anyone able to take a longer view knows we’ll one day be well past Obamacare’s self-inflicted wounds, I’d like as a public service to catalog the GOP’s shabbiest arguments, so we’ll all have a handy reference once the worm fully turns.
The selective “humanitarian crisis.” Conservatives have warned of the “humanitarian disaster” that will ensue if several million people with cancelled policies are unable to secure new coverage before January 1. But this theoretical woe (which will almost certainly be avoided thanks to Web site fixes and policy extensions) pales next to the much larger humanitarian disaster of America’s nearly 50 million uninsured — a crisis that’s persisted for decades without conservatives caring a whit. I can’t be the only one who finds the right’s sudden concern for a small subset of the uninsured a bit rich.
The bogus oppression of the young and healthy. Another confused conservative trope bemoans the enslavement of younger or healthier Americans, who’ve supposedly been conscripted to subsidize their older, sicker countrymen. “Liberals justify these coercive cross-subsidies as necessary to finance coverage for the uninsured and those with pre-existing conditions,” the Wall Street Journal editorialized last Saturday. “But government usually helps the less fortunate honestly by raising taxes to fund programs.” Actually, the Journal has the American way of health subsidy exactly wrong. Most people aged 19 to 34 who have health coverage get it from their employer. And, as I’ve noted before, at nearly every firm, young people pay the same premiums as employees who are older and get more expensively sick. In other words, Obama’s scheme to rob Peter to fund health care for Paul already exists, at vastly larger scale, in corporate America. And while Obamacare is only hoping to sign up 2 million or so young people, 20 million Americans aged 19 to 34 get their coverage on the job. Where’s the Wall Street Journal’s rant against corporate America’s “coercive cross-subsidies”? And while we’re at it, when will we stop making all those people whose houses don’t burn down subsidize those whose do?
The “men and 55 year old women don’t need maternity care” fallacy. Well, yes, and people whose genes don’t predispose them to cancer (which tests will reveal soon enough) don’t need cancer coverage. As Bob Kocher, a doctor and former senior Obama health care advisor, explained, if one of our goals is to not charge women higher premiums than men, all plans have to cover maternity. Among younger women, moreover, maternity is the biggest driver of costs — so if you allow optional coverage, the plans young people buy would be super-expensive. “For insurance to work, you can’t allow people to opt into benefits like maternity right before they get pregnant,” Kocher adds. “When spread across the population, it’s not expensive.” Sounds like Insurance 101. Which in the social insurance context, conservatives can’t abide.
Insurance “bailout” baloney. Sen. Marco Rubio talks opportunistically (but I repeat myself) of Obama’s pledge to “bail out” health plans if the folks they sign up end up being unduly costly to treat. Once again, conservatives eat their own. Such “risk adjustment” — after-the-fact payments to reflect the actual vs. expected risk experience of health plans — has been a sensible staple of conservative insurance market reforms since George H.W. Bush proposed it in 1992. Little known but true: Before Romneycare begat Obamacare, Bushcare begat Romneycare. Rubio was only 21 then. He must not know. Or care.
The “Obama is taking over one-sixth of the economy” ruse. In the Fox News cocoon, this truth is self-evident. But it makes as much sense as crying that Ben Bernanke is “remaking 6/6ths of the economy” every time the Fed touches interest rates. The fact that health-care spending is 18 percent of GDP doesn’t mean Obama is “remaking” or “taking over” anything. He’s tweaking a dysfunctional corner of the market where 5 percent of us get our health coverage. He’s also testing ideas that health gurus in both parties have long suggested might help reign in future costs.
Worse than these GOP fallacies is the party’s smug sanctimony. It’s as if conservatives have decided to parody the moral preening they loathe in liberals, except that the right is serious. As one pundit lectured, “the administration didn’t care enough to make sure the people of their country were protected. In the middle of a second age of anxiety they decided to make America more anxious.”
Yes, the rollout was botched. But what is this person talking about? Finally assuring that illness in the United States can’t be the cause of financial ruin is the very essence of “protection.” How galling that conservatives can make such hollow charges while putting forward no plan of their own to “protect” anyone from anything!
Or take the pundit who wrote that “extending enrollment periods does nothing but provide Americans more time to contemplate their miserable choices.” Only someone with no empathy — someone who has never tried and failed to get coverage in the individual market — could possibly say such a thing.
I’ve spent a lot of time over the years arguing that we can solve big problems such as providing insurance coverage in ways that honor both liberal and conservative values. It’s entirely doable — John Rawls and Milton Friedman can be reconciled, trust me. Apart from being sound policy, I’ve assumed such approaches would also be necessary, because with power closely divided in the United States, we’d need to strike big cross-party deals to make progress. The breathtaking intellectual and moral dishonesty of those driving the Obamacare debate in the GOP today makes me feel foolish for having tried.
By: Matt Miller, Opinion Writer, The Washington Post, December 4, 2013
“Will The GOP Ever Be Happy?”: No Matter The Facts, They Just Don’t Care If Healthcare.Gov Works Or Not
Healthcare.gov is well on its way to full stability, but Republicans refuse to acknowledge it. No matter the facts, the GOP is committed to the message that Obamacare has failed.
It wasn’t that long ago when Republicans were deeply concerned over the quality of the president’s healthcare website.
In a letter to Kathleen Sebelius, head of the Department of Health and Human Services, Rep. Darrell Issa and Sen. Lamar Alexander demanded answers for the massive glitches that attended the rollout of Healthcare.gov. “We are concerned by recent comments to the media that the system suffers from architectural problems that need design changes,” wrote the two GOP lawmakers, “We seek information about these problems as well as whether you still expect individuals to suffer a tax penalty if they do no purchase government-approved health insurance.”
Likewise, in a statement, Republican National Committee chairman Reince Priebus said that “Obamacare is collapsing under its own weight.” This was echoed by the Senate Republican Policy Committee, which called the website an “inexcusable train wreck” and wondered “how President Obama can tax uninsured Americans for not having something that they can’t purchase.”
The administration responded to all of this criticism—and more—with a promise that Healthcare.gov would work for the majority of users by December 1st. And it does. According to the administration, a five week “tech surge” has doubled the capacity of the online interface to the health care exchanges that form the core of the Affordable Care Act. As of this month, the website can handle 50,000 simultaneous users, for a total limit of 800,000 users per day. The site is functional more than ninety percent of the time, up from fifty-five percent of the time in October.
There is still a whole host of work to finish, especially on the back-end, where critical communications are made to insurers with regards to subsidies and eligibility. Overall, however, the White House has achieved more than 400 of the 600 fixes on its “punchcard” of repairs. Healthcare.gov is on the fast track to full stability, which will be a significant boost to the law and its prospects.
Given the extent to which Republicans were so concerned with the status of the website, you’d think they would greet this as good news, even as they continue to oppose the law. The message doesn’t have to be extensive. Something as simple as, “We still oppose the law, but we’re glad Americans haven’t been left in the cold,” would suffice.
Even that, however, is too generous for Republicans, who can’t concede any goodwill to the president’s health care law. “[The] website is least of Obamacare’s problems,” tweeted Sen. John Cornyn of Texas. “This isn’t just about a broken website, it’s about a fundamentally-flawed law,” wrote Michael Steel, a spokesperson for Speaker of the House John Boehner. And on ABC’s This Week, Oklahoma Senator Tom Cole said that “You never get a second chance to make a first impression, and the first impression here was terrible.”
The Republican complaints of two months ago were purely opportunistic. For them, it just doesn’t matter if Healthcare.gov is working, since Obamacare is destined to fail, reality be damned! At most, the broken website was useful fodder for attacks on the administration. Now that it’s made progress, the GOP will revert to its usual declarations that the Affordable Care Act is a hopeless disaster. Meanwhile, hundreds of thousands of Americans have gained access to health insurance thanks to the Medicaid expansion or the exchanges, and many more will join their ranks as the deadline for coverage approaches.
Republicans haven’t offered a response to this because, as of this moment, the party doesn’t have a response. Yes, there are conservative intellectuals with ideas for reform, but as an institution, the GOP has little to say about the constellation of problems in American health care. Even in their drive for repeal, Republicans failed to offer an alternative. At most, lawmakers like Bob Corker of Tennessee have tentatively called for “market-driven” reforms, like changes to the tax code, and allowing insurers to sell across state lines. Ironically, the Affordable Care Act allows for these changes, but that doesn’t seem to matter to the GOP.
It’s almost cliché to say that the Democratic Party is gambling its success on the Affordable Care Act. If it works, the party can point to a broad program that delivers needed benefits to millions of Americans. If it doesn’t, it’s hard to imagine how Democrats will re-earn the trust of a skeptical public, to say nothing of the fate of the uninsured and the broader consequences for liberalism.
In the same way, the Republican Party is gambling its fate on the failure of the law, with no attempt to grapple with the possibility of its success. What happens if Obamacare works as advertised? How do GOP leaders salvage a failed crusade? And more importantly, how do GOP voters react when the prospect of repeal is completely, unambiguously off the table?
By: Jamelle Bouie, The Daily Beast, December 2, 2013
“The GOP Culture Is Quite Ill”: The Republican Anti-Obamacare Purity Cult
Sahil Kapur at TPM has a fine report today looking at how hatred of Obamacare has become such an ideé fixe in the Republican party that even the mildest possible concession—or failing to be sufficiently enraged in one’s condemnation of the law—has become grounds for a harsh primary attacks:
[One] victim is Sen. Mike Enzi (R-WY), who is fending off a primary challenge from Liz Cheney in 2014. An outside group called Americans for Job Security last week released an ad attacking him for praising the concept of insurance market exchanges — the vehicle for Obamacare, which was modeled on conservative principles — early in 2010. “These exchanges can be good,” Enzi said then, in a clip that the ad repeatedly plays.
“Good?” says the narrator in the 30-second ad. “Wyoming’s Obamacare exchange has the most expensive premiums in the country, and it’s marred by glitches. Tell Mike Enzi we don’t like these liberal, big government Obamacare exchanges.” The attack forced Enzi’s campaign to defend him by touting his efforts to “stop the worst parts of the law.”
…[AEI scholar Norman] Ornstein summed it up this way: “These are the talking points and if you don’t apply them, then you’re a traitor.” He confessed that he’s “never seen anything like that before. I mean, you can certainly find party litmus tests…But this has been taken to a level that I think is almost bizarre.”
The comparison everyone is making is to McCarthyism in the 1950s, but there are some notable differences. The McCarthy era was all about nutty right-wing witch hunts, heavily laden with antisemitism and paranoia about fluoridated water and vaccines, led by an alcoholic, power-mad bully. But more to the point, red paranoia was widely shared throughout society. Both parties were fervently anti-communist. There really was a Soviet Union, which really did have nuclear missiles and an extensive spying apparatus. There really was terrible anxiety about another world war.
Whereas the Republican Obamacare purity rituals are restricted to their party only, and from the outside are frankly bizarre. They treat a moderate, incremental reform of the healthcare sector, based largely on Republican ideas, like New Lefters treated Nixon’s bombing of Cambodia. I’m reminded more of Maoist “struggle sessions,” where enemies of the party were publicly beaten and forced to confess their ideological crimes, real or imagined.
But in any case, the historical analogies one reaches for to describe this trend are telling in themselves. The GOP culture is quite ill, and shows little sign of improving anytime soon.
By: Ryan Cooper, Washington Monthly Political Animal, December 2, 2013
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