“What Obamacare Death Spiral?”: So Sorry Republicans, The Rumors Have Been Greatly Exaggerated
Supporters of the Affordable Care Act have been terrified for months now that a combination of a botched online enrollment system, terrible press, and Republican sabotage could send the individual market part of the new system into the much-discussed “death spiral” where a disproportionately large population of older and sicker enrollees would produce very high premiums, which would in turn repel younger and healthier eligibles even more, creating a self-perpetuating disaster.
At Wonkblog today Sarah Kliff reports some research from the Kaiser Family Foundation indicating that fears of a “death spiral” are significantly overblown:
The rumors of an Obamacare death spiral have been greatly exaggerated. So say Larry Levitt, Gary Claxton and Anthony Damico, experts at the Kaiser Family Foundation who have put together a new brief analyzing what would happen if young adults snubbed the Affordable Care Act. Even if young people sign up at half the rate the administration hopes for, it would nudge premiums up only by a few percentage points, their report says.
“When you do the math, it matters, but not nearly as much as the conventional wisdom suggests,” Levitt says….
If young adults (those under 35) were 25 percent less likely than the rest of the population to sign up for Obamacare, they would represent 33 percent of exchange enrollees — rather than 40 percent. This means there would be fewer young people to subsidize older insurance subscribers. To make up that difference, the experts estimated, insurers would need to increase premiums by a terrifying … 1 percent. Yes, exactly 1 percent.
Levitt, Claxton and Damico also tested a scenario where young adults are half as likely as older shoppers to enroll. In that case, the younger enrollees would make up only a quarter of the exchange market. Premiums would fall 2.5 percent short of covering subscribers.
Wow. If these numbers are accurate, the widespread assumption (particularly among happy Republicans) that there’s nothing ahead for exchange enrollees beyond “sticker shock” forever could give way to the expectation that Obamacare will eventually be self-stabilizing, at least for most enrollees. That in turn would upset GOP calculations that they can perpetually benefit from Obamacare’s problems without coming up with their own credible “replacement” proposal (the ones we’ve seen so far, which rely on destructive gimmicks like interstate insurance sales and state-run high-risk pools, while vastly disrupting employer-based coverage, just aren’t credible once you get beyond the slogans).
A whole lot of GOP strategery for 2014 and 2016 depends on an Obamacare crash. They might want to start seriously considering a Plan B that isn’t even worse than the pre-Obamacare status quo ante.
By: Ed Kilgore, Contributing Writer, Washington Monthly Political Animal, December 18, 2013
“No Way Out”: GOP Eyes “Obamacare Trap” Warily
Rep. Marlin Stutzman (R) held an event in his Indiana district this week, at which health care was a major topic of conversation. According to a local press account, not everyone in this Republican area necessarily opposes “Obamacare.”
But Stutzman seemed to realize at the event that simply condemning what he doesn’t like won’t be enough. “What are you replacing it with? That’s what everybody is asking right now,” the congressman said, adding, “There’s several Republican plans that are competing with each other right now just internally. After the first of the year, we are going to try to sort through that.”
That last part was actually rather newsworthy – we didn’t know that House Republicans are planning to finally present their alternative to the Affordable Care Act sometime in 2014. In fact, Byron York reported that intra-party talks are still underway.
[I]n private discussions, House Republicans stress their differences over the details of an Obamacare alternative. For example, there’s no agreement on precisely how to fix the tax inequity for people who don’t receive health coverage at work. There are similar disagreements over all sorts of other points of policy. “Getting unanimity is a tall order for a divided, leaderless party,” says the GOP aide.
As Democrats can attest, getting unanimity is a tall order for a united party with strong leaders, too.
Regardless, while York describes an “Obamacare trap” in which Republican lawmakers struggle with whether to fix or destroy the existing system, the circumstances lead me to believe a very different kind of trap is set.
Let’s say, after five years of effort, House Republicans finally emerge from behind closed doors with a health care reform package they’re proud of and willing to present to the public. What then? The GOP plan will be subjected to some policy scrutiny, which is where the party is likely to run into some trouble.
It’s easy to imagine a side-by-side comparison, in which the Affordable Care Act is tested against the Republican alternative. Which covers more uninsured Americans? Which reduces the deficit more? Which offers the stronger consumer protections? Which is more effective in controlling long-term costs?
I’d bet good money that on all of these questions, the GOP plan will lose – not because Republican policies are necessarily worse than Democratic policies, but because Republicans have already said their approach to health care would eschew regulations and public investments. And while it’s possible to create a health care plan without spending or safeguards, it’s not possible to create a good health care plan without them.
Ultimately, that’s the “trap” GOP officials need to be mindful of. On the one hand, they can continue to offer nothing in the way of an alternative, effectively telling the public they’re not serious about the issue and they prefer to take cheap shots rather than govern. On the other, they can build a consensus around an Obamacare alternative that almost certainly won’t be nearly as good as the ACA. (Remember, the basic framework of the Affordable Care Act was the Republican policy up until a few years ago.)
The trap is set. The question isn’t whether Republicans will fall in, but rather, whether they can get out.
By: Steve Benen, The Maddow Blog, December 18, 2013
“An Ideological Hurdle They Can’t Clear”: Why There’s No Republican Health Care Plan
Where’s the Republican alternative to the Affordable Care Act? The question is generally best suited for milk cartons – it’s pretty clear GOP officials would love to “repeal” the federal health care law, but we’ve been waiting for years to know what they’d “replace” it with.
This observation is an ongoing point of annoyance for the right, which is quick to argue that a variety of Republicans have presented reform plans of their own. Americans for Tax Reform’s Grover Norquist and Patrick Gleason push the argument in a new Politico piece, and Sen. Pat Toomey (R-Pa.) made a related case in the Republicans’ official weekly address over the weekend.
“There are common-sense, bipartisan solutions to our health care problems that don’t require ObamaCare’s wholesale government take-over of the system,” Toomey said. “Now, in a nutshell, we can make insurance more accessible, more affordable, and more responsive to individuals and families. And put patients and their doctors in charge of health care decisions, instead of politicians and government bureaucrats.” […]
Toomey did not mention a specific proposal, but he voiced support for allowing people to transfer insurance from job to job and purchase it across state lines.
And just like that, we’re reminded all over again why Republicans love to attack what exists, but struggle to craft a credible alternative of their own. Toomey still doesn’t quite understand that the Affordable Care Act is not a “wholesale government take-over” of the health care system, and more importantly, can’t get past the “nutshell” phase of the GOP’s rival policy.
In fairness, it’s worth emphasizing that Republicans did present something resembling a health care plan in 2009. Following up on our previous coverage, GOP officials missed a series of self-imposed deadlines in 2009, but eventually threw together a half-hearted joke – the GOP “policy” largely ignored the uninsured, did nothing for those with pre-existing conditions, and offered nothing for those worried about losing coverage when it’s needed most.
As Matt Yglesias noted at the time, the Republican approach to reform sought to create a system that “works better for people who don’t need health care services, and much worse for people who actually are sick or who become sick in the future. It’s basically a health un-insurance policy.” And as ThinkProgress added, the CBO crunched the numbers and found that the Republican alternative would leave “about 52 million” Americans without access to basic medical care.
Pressed for some kind of alternative to Obamacare, this was the best congressional Republicans could do.
Since then, GOP lawmakers have periodically stepped up with alternatives, all of which looked pretty similar. Indeed, a few months ago, when the Republican Study Committee said they’d finally put together an “Obamacare” rival, Ed Kilgore predicted before its unveiling that the policy would feature high-risk pools, interstate sales, tax credits, tort reform, and entitlement reform. A couple of hours later, the RSC unveiled its proposal and it was … exactly what Kilgore predicted it would be.
Months later, Toomey used his party’s weekly address to reiterate support for the same cliches.
The result is a stunted debate. We don’t have two competing approaches to solving a problem that has plagued the nation for decades; we have one party with a solution and another party that hates the solution but has no serious alternative. And this isn’t likely to change anytime soon – NBC’s First Read reported two weeks ago, “House Republicans wouldn’t commit Tuesday to offering their own formal alternative to the Affordable Care Act, instead vaguely describing their preference for a ‘patient-driven health care system.’”
As for why Republicans have no rival plan, as we discussed in September, there’s no great mystery. Every credible, effective solution requires some combination of regulating the private insurance market and investing in broader coverage for consumers. There’s just no way around that, and as a result, GOP officials are left with an ideological hurdle they simply cannot clear.
And so Republicans spin their wheels, condemning a policy that they used to like – remember, the basic ACA blueprint was a conservative approach to health care reform – while pretending to have an alternative they can’t identify in earnest.
By: Steve Benen, The Maddow Blog, December 16, 2013
“Ending Medicare As We Know It”: Here’s Why There Won’t Be A Republican Alternative To Obamacare
Republicans are sick of people saying they don’t have an alternative to Obamacare.
They have plenty!
And not just, “Don’t get sick! And if you do get sick, die quickly,” as Rep. Alan Grayson (D-FL) said in 2009.
The Republican-controlled House of Representatives just hasn’t voted on even one Obamacare alternative because it’s hard to fit stuff in when you only work 28 hours a week and have to squeeze in all those Obamacare repeals.
But they’re going to fix that problem in 2014, says Rep. Tom Price (R-GA).
The congressman has introduced his Obamacare alternative — the Empowering Patients First Act — three times since 2009. Price’s bill has never been given a vote, even though it has 50 co-sponsors, including the eminent Rep. Michele Bachmann (R-MN).
Price told Fox News that after the first of the year, Republican leaders are going to bring forth a bill that will “unite Republicans around health care issues” because “you can’t beat something with nothing.”
This logic runs contrary to Town Hall‘s Conn Carroll, who believes the House GOP won’t coalesce around one plan or, as he calls it, “a villain to run against.”
This has been the GOP strategy since 2010, and don’t expect it to change, despite the assurances the leadership has given to Rep. Price.
Price’s bill has never been scored by the Congressional Budget Office (CBO). But a former Republican head of the CBO scored it independently and found that it saves trillions of dollars over 10 years and will reduce the uninsured population by 29 percent by 2016.
If this is true, why haven’t Republicans even put it up for a vote?
A quick look at H.R. 2300, the current version of Price’s bill, shows you why the GOP likely won’t propose an alternative to Obamacare — ever.
The bill starts off with Republicans’ favorite health care distractions — tort reform and selling across state lines.
If you eliminated every malpractice claim in America, that would only reduce the costs of our health care system by 1 to 1.5 percent – far less than implementing a public option.
Selling insurance over state lines would just give insurers the chance to sell plans from the state with the fewest regulations. The Washington Post‘s Ezra Klein looked at a CBO report on a bill from 2005 that would have made national sales of state insurance plans possible and found “the legislation would not change the number of insured Americans or save much money, but it would make insurance more expensive for the sick and cheaper for the healthy, and lead to more healthy people with insurance and fewer sick people with insurance.”
The real goal of Price’s bill and just about every Republican reform of the health care system is to end the employer-provided health insurance dynamic that most Americans rely upon. Employers get a generous tax break for providing health coverage that Price would then extend to individuals. The 2009 version of his bill did this in a way that would actually have resulted in a huge tax increase.
But the bigger problem with Price’s plan to sever the employer-employee health insurance relationship and create plans that stay with an individual for life is that it would end up in cancelations of current plans — tens of millions of cancelations.
Republicans could argue that these new plans would be better than the existing plans for various reasons — but that’s an argument they know doesn’t work, because they crushed it when Democrats used it to defend the cancelations that happened after the implementation Obamacare.
Price says his plan would cover people with pre-existing conditions, though it doesn’t include an individual mandate or any incentive to prevent insurers from cherry-picking the healthiest consumers.
“In other words, this looks much like the reforms that collapsed in Texas, and in California,” Klein noted. ”Price isn’t learning from past policy mistakes, and so he means to repeat them.”
The biggest problem with Price’s bill is how it reforms existing public health care programs.
If H.R. 2300 became law, anyone could opt out of Medicare or Medicaid and receive a voucher to purchase private insurance.
We have no idea how many people would opt out of Medicare given the fact that few private insurers see people over 65 as the path to prosperity for their business. But when the growth of Medicare costs is far below that of private insurers, all that voucher would end up being is a ticket to pay far more for health care at the time of your life when it will cost you the most.
And if too many beneficiaries opted out, the entire system of dictating costs to providers in exchange for volume could collapse with devastating effects to our deficit and debt.
The worst part for Republicans is the facet of the law that allows Democrats to make a pretty simple case against the GOP’s Obamacare alternative: It ends Medicare as we know it. The GOP could rebut that assertion by saying that Medicare will still exist for those who want it, but a party that has been shedding senior support all year doesn’t want to have that argument.
Any alternative the GOP proposes to replace Obamacare is going to spark negative headlines — even if the GOP manages to evade the tax increases, cancelations and potential problems for Medicare that exist in Price’s bill.
If the Republican leadership makes the mistake of offering an alternative, they’ll dull the sting of their attacks on Obamacare by having to defend some version of a plan they were wise enough to sit on for years.
By: Jason Sattler, The National Memo, December 16, 2013
“Obscuring The Bigger Picture”: The Republican Tempest Over The Affordable Care Act Diverts Attention From Three Large Truths
Having failed to defeat the Affordable Care Act in Congress, to beat it back in the last election, to repeal it despite more than eighty votes in the House, to stop it in the federal courts, to get enough votes in the Supreme Court to overrule it, and to gut it with outright extortion (closing the government and threatening to default on the nation’s debts unless it was repealed), Republicans are now down to their last ploy.
They are hell-bent on destroying the Affordable Care Act in Americans’ minds.
A document circulating among House Republicans (reported by the New York Times) instructs them to repeat the following themes and stories continuously: “Because of Obamacare, I Lost My Insurance.” “Obamacare Increases Health Care Costs.” “The Exchanges May Not Be Secure, Putting Personal Information at Risk.”
Every Republican in Washington has been programmed to use the word “disaster” whenever mentioning the Act, always refer to it as Obamacare, and demand its repeal.
Republican wordsmiths know they can count on Fox News and right-wing yell radio to amplify and intensify all of this in continuous loops of elaboration and outrage, repeated so often as to infect peoples’ minds like purulent pustules.
The idea is to make the Act so detestable it becomes the fearsome centerpiece of the midterm elections of 2014 — putting enough Democrats on the defensive they join in seeking its repeal or at least in amending it in ways that gut it (such as allowing insurers to sell whatever policies they want as long as they want, or delaying it further).
Admittedly, the President provided Republicans ammunition by botching the Act’s roll-out. Why wasn’t HealthCare.gov up and running smoothly October 1? Partly because the Administration didn’t anticipate that almost every Republican governor would refuse to set up a state exchange, thereby loading even more responsibility on an already over-worked and underfunded Department of Health and Human Services.
Why didn’t Obama’s advisors anticipate that some policies would be cancelled (after all, the Act sets higher standards than many policies offered) and therefore his “you can keep their old insurance” promise would become a target? Likely because they knew all policies were “grandfathered” for a year, didn’t anticipate how many insurers would cancel right away, and understood that only 5 percent of policyholders received insurance independent of an employer anyway.
But there’s really no good excuse. The White House should have anticipated the Republican attack machine.
The real problem is now. The President and other Democrats aren’t meeting the Republican barrage with three larger truths that show the pettiness of the attack:
The wreck of private insurance. Ours has been the only healthcare system in the world designed to avoid sick people. For-profit insurers have spent billions finding and marketing their policies to healthy people – young adults, people at low risk of expensive diseases, groups of professionals – while rejecting people with preexisting conditions, otherwise debilitated, or at high risk of heart disease, diabetes, and cancer. And have routinely dropped coverage of policy holders who become seriously sick or disabled. What else would you expect from corporations seeking to maximize profits?
But the social consequences have been devastating. We have ended up with the most expensive healthcare system in the world (finding and marketing to healthy people is expensive, corporate executives are expensive, profits adequate to satisfy shareholders are expensive), combined with the worst health outcomes of all rich countries — highest rates of infant mortality, shortest life spans, largest portions of populations never seeing a doctor and receiving no preventive care, most expensive uses of emergency rooms.
We could not and cannot continue with this travesty of a healthcare system.
The Affordable Care Act is a modest solution. It still relies on private insurers — merely setting minimum standards and “exchanges” where customers can compare policies, requiring insurers to take people with preexisting conditions and not abandon those who get seriously sick, and helping low-income people afford coverage.
A single-payer system would have been preferable. Most other rich countries do it this way. It could have been grafted on to Social Security and Medicare, paid for through payroll taxes, expanded to lower-income families through Medicaid. It would have been simple and efficient. (It’s no coincidence that the Act’s Medicaid expansion has been easy and rapid in states that chose to accept it.)
But Republicans were dead set against this. They wouldn’t even abide a “public option” to buy into something resembling Medicare. In the end, they wouldn’t even go along with the Affordable Care Act, which was based on Republican ideas in the first place. (From Richard Nixon’s healthcare plan through the musings of the Heritage Foundation, Republicans for years urged that everything be kept in the hands of private insurers but the government set minimum standards, create state-based insurance exchanges, and require everyone to sign up).
The moral imperative. Even a clunky compromise like the ACA between a national system of health insurance and a for-profit insurance market depends, fundamentally, on a social compact in which those who are healthier and richer are willing to help those who are sicker and poorer. Such a social compact defines a society.
The other day I heard a young man say he’d rather pay a penalty than buy health insurance under the Act because, in his words, “why should I pay for the sick and the old?” The answer is he has a responsibility to do so, as a member the same society they inhabit.
The Act also depends on richer people paying higher taxes to finance health insurance for lower-income people. Starting this year, a healthcare surtax of 3.8 percent is applied to capital gains and dividend income of individuals earning more than $200,000 and a nine-tenths of 1 percent healthcare tax to wages over $200,000 or couples over $250,000. Together, the two taxes will raise an estimated $317.7 billion over 10 years, according to the Joint Committee on Taxation.
Here again, the justification is plain: We are becoming a vastly unequal society in which most of the economic gains are going to the top. It’s only just that those with higher incomes bear some responsibility for maintaining the health of Americans who are less fortunate.
This is a profoundly moral argument about who we are and what we owe each other as Americans. But Democrats have failed to make it, perhaps because they’re reluctant to admit that the Act involves any redistribution at all.
Redistribution has become so unfashionable it’s easier to say everyone comes out ahead. And everyone does come out ahead in the long term: Even the best-off will gain from a healthier and more productive workforce, and will save money from preventive care that reduces the number of destitute people using emergency rooms when they become seriously ill.
But there would be no reason to reform and extend health insurance to begin with if we did not have moral obligations to one another as members of the same society.
The initial problems with the website and the President’s ill-advised remark about everyone being able to keep their old policies are real. But they’re trifling compared to the wreckage of the current system, the modest but important step toward reform embodied in the Act, and the moral imperative at the core of the Act and of our society.
The Republicans have created a tempest out of trivialities. It is incumbent on Democrats — from the President on down — to show Americans the larger picture, and do so again and again.
By: Robert Reich, The Robert Reich Blog, November 22, 2013
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