“We Invent, Experiment, And Fix What Has To Be Fixed”: Why You Shouldn’t Succumb To Defeatism About The Affordable Care Act
Whatever happened to American can-do optimism? Even before the Affordable Care Act covers its first beneficiary, the nattering nabobs of negativism are out in full force.
“Tens of millions more Americans will lose their coverage and find that new ObamaCare plans have higher premiums, larger deductibles, and fewer doctors,” predicts Republican operative Karl Rove. “Enrollment numbers will be smaller than projected and budget outlays will be higher.”
Rove is joined by a chorus of conservative Cassandra’s, from Fox News to the editorial pages of the Wall Street Journal, all warning that the new law will be a disaster.
Robert Laszewski, president of Health Policy and Strategy Associates, anticipates a shortage of doctors. “There just aren’t going to be enough of them.”
Professor John Cochrane of the University of Chicago predicts the individual mandate will “unravel” when “we see how sick the people are who signed up on exchanges, and if our government really is going to penalize voters for not buying health insurance.”
The round-the-clock nay-saying is having an effect. Support for the law has plummeted to 35 percent of those questioned in a recent CNN poll, a 5-point drop in less than a month. Sixty-two percent now say they oppose the law, up four points from November.
Even liberal-leaning commentators are openly worrying. On ABC’s “This Week,” Cokie Roberts responded to my view that the law eventually would prove popular by warning of “a whole other wave of reaction against it” if employers start dropping their insurance.
Some congressional Democrats are getting cold feet. West Virginia Senator Joe Manchin recently fretted that “if it’s so much more expensive than what we anticipated and if the coverage is not as good as what we had, you’ve got a complete meltdown.”
Get a grip.
If the past is any guide, some fixes will probably be necessary – but so what? Our current healthcare system is the real disaster — the most expensive and least effective among all developed countries, according Bloomberg’s recent ranking. We’d be collectively insane if we didn’t try to overhaul it.
But we won’t get it perfect immediately. What needs fixing can be fixed. And over time we can learn how to do it better.
If enrollments are lower than anticipated, the proper response is to keep at it until larger numbers are enrolled. CHIP, the Children’s Health Insurance Program, got off to a slow start in 1998. The Congressional Research Service reported “general disappointment … with low enrollment rates early in the program.” CHIP didn’t reach its target level of enrollment for five years. Now it enrolls nearly ninety percent of all eligible children.
Richard Nixon’s Supplemental Security Income program of 1974 – designed to standardize welfare benefits to the poor — was widely scorned at the time, and many states were reluctant to sign up. Even two years after its launch, only about half of eligible recipients had enrolled. Today, more than 8 million Americans are covered.
If mistakes are made implementing the Affordable Care Act, the appropriate response is to fix them. When George W. Bush’s Medicare Part D drug benefit was launched, large numbers of low-income seniors had to be switched from Medicaid. Many needed their prescriptions filled before the switch had been completed, causing loud complaints. The website for the plan initially malfunctioned. Pharmacies got the wrong information. Other complications led even Republican Representative John Boehner to call it “horrendous.” But the transition was managed, and Medicare Part D is now a firm fixture in the Medicare firmament.
If young people don’t sign up for the Affordable Care Act in sufficient numbers and costs rise too fast, other ways can be found to encourage their enrollment and control costs. If there aren’t enough doctors initially, medical staffs can be utilized more efficiently. If employers begin to drop their own insurance, incentives can be altered so they don’t.
Why be defeatist before we begin? Even Social Security — the most popular of all government programs — had problems when it was launched in 1935. A full year later, Alf Landon, the Republican presidential candidate, called it “a fraud on the workingman.” Former President Herbert Hoover said it would imprison the elderly in the equivalent of “a national zoo.” Americans were slow to sign up. Not until the 1970s did Social Security cover most working-age Americans.
As Alexis de Tocqueville recognized as early as the 1830s, what distinguishes America is our pragmatism, resilience, and optimism. We invent, experiment, and fix what has to be fixed.
Of course there will be problems implementing the Affordable Care Act. But if we’re determined to create a system that’s cheaper and more effective at keeping Americans healthy than the one we have now – and, in truth, we have no choice – we have every chance of succeeding.
By: Robert Reich, The Robert Reich Blog, December 27, 2013
“Fast And Loose With The Facts”: Lying About Obamacare Continues As Campaign Season Begins
You may want to sit down before reading this: Republicans aren’t being totally truthful about the Affordable Care Act (ACA). As the 2014 midterm elections approach, conservative groups are beginning to hit the airwaves with spots targeting vulnerable Democrats and their support for the health law — and the ads are playing fast and loose with the facts.
Americans for Prosperity, the tax-exempt conservative action group created by brothers Charles and David Koch, took out two ads against vulnerable Democrats: Rick Nolan of Minnesota’s 8th District and Ann Kuster of New Hampshire’s 2nd District. Both focus on the health-care law, and they are important to dissect because they are the first trickles of what is sure to be a torrent of anti-ACA advertising.
The ad against Nolan features a middle-aged Minnesota resident named Randy Westby, who [http://youtu.be/-VVwc60M8zg]says he lost his health care plan because it no longer qualified for purchase in the exchanges. “I’ve had three heart attacks in the last six years. Health care is something that’s essential, and my life depends on it,” he continues.
The ad leans heavily on Politifact’s “Lie of the Year” designation for President Obama’s “if you like your plan, you can keep it” claim, and gives the strong impression that sick people are much worse off under Obamacare.
But was Westby able to find another plan? Four million to five million people probably had their plan canceled because of updated coverage requirements, but the administration believes fewer than 500,000 of those people are still looking for another plan. The ad doesn’t tell us if Westby is one of those people.
Nor does it note that he can’t be disqualified from any of the plans on the exchanges because of his preexisting condition — and three heart attacks in six years is one heck of a preexisting condition. Are the plans available to him cheaper than what he had before? How much better is the coverage? We don’t know, although given Westby’s medical history and apparent age, it seems he is exactly the type of person most likely to benefit from how the new individual market is structured.
The New Hampshire ad is more general and features an actress, but it relies on the same central and shaky claim that “millions of people” are losing coverage. Both ads hit the Democrats in question for voting to keep the ACA in place. (Aside from firing up the conservative grass roots, there was a good political reason for all those repeal votes in the House: to get vulnerable Democrats on the record, again and again.)
A focus on horror stories like these is the likely new Republican approach to Obamacare, as the New York Times outlines today. “It’s no longer just a piece of paper that you can repeal and it goes away,” Sen. Ron Johnson (R-Wis.) told the times. “There’s something there. We have to recognize that reality. We have to deal with the people that are currently covered under Obamacare.”
But Westby may well be one of these people. And he may be getting better coverage. These will be the battle lines for the upcoming year: Republicans are gearing up to tell the horror stories, and Democrats will have to respond with stories of their own — the eight million to 10 million people who will be getting coverage under Obamacare by the end of March.
By: George Zornick, The Plum Line, The Washington Post, December 27, 2013
“Not A Bad General Election Issue”: Should Democrats Press The Public Option?
There’s no question that the Affordable Care Act’s rollout has been “rocky,” to borrow the common parlance of the Beltway. The Web site troubles and shifting health coverage for some Americans, despite over-assurances from President Obama during the 2010 political debate, have naturally turned off some people. A much-ballyhooed poll from CNN yesterday shows that support for “Obamacare” has dropped to an all-time low.
But conservatives toasting the apparent turn in public opinion ought to look a little closer at the polling data. It’s true that only 35 percent of Americans favor the law, while 43 percent oppose it. But there’s a crucial third group: 15 percent oppose the ACA because it’s “not liberal enough.” That means that 50 percent of Americans either support the law or want policy changes that shift leftward.
Looking at the polls in that light suddenly shifts the political calculus. Republicans who want to repeal and “replace” the legislation — with measures that have never been entirely clear, especially when it comes to the most popular provisions of the ACA — are suddenly facing an uphill battle with the public.
This presents a pretty clear road map for Democrats worried that the biggest legislative achievement of the Obama era might turn against them. The CNN/ORC poll didn’t press people on what, exactly, “not liberal enough” meant, but it’s not hard to imagine what those people might want. Recall that while the legislation was being crafted, the public broadly supported a “public option” in the bill that would allow people purchasing insurance on the exchanges to select a federal health insurance plan.
So what if Democrats pushed for it? A public option would save $100 billion over 10 years, according to the Congressional Budget Office, and could offer respite from the plan cancellations and rate hikes that still persist with private insurers with the ACA in place.
There’s essentially no chance President Obama will take another bite at the health-care apple, especially with so many other priorities to tackle: his professed desire to combat climate change and income inequality before he leaves office, along with getting comprehensive immigration reform passed. But strategists on 2016 presidential campaigns ought to take heed.
Imagine a candidate who comes out early, and strong, for adding a public option to the ACA exchanges. It could become a signature issue with the liberal grass roots during the primaries, and it wouldn’t be a bad general election issue either — the polls in 2010 showed support for a public option among Republicans and independents as well as Democrats. As Ezra Klein has noted, the sudden disappearance of the public option from Democratic politics has been “a bit curious,” but perhaps its day is coming.
By: George Zornick, The Plum Line, The Washington Post, December 24, 2013
“Extending The Hardship Exemption”: You Can Still Have Weak Health Insurance Under Obamacare, For Now
If you liked your old skimpy health plan, you may not be able to keep it. But now you can get a new, somewhat skimpy health plan instead, at least for a little while.
That’s a rough translation of an Obamacare policy change that the Administration announced on Thursday. The change, first reported by Louise Radnofsky of the Wall Street Journal, represents yet another effort to help people about to lose their existing insurance policies, usually because those policies do not comply with the Affordable Care Act’s standards for benefits and pricing. Those old policies left out major benefits, were sold only to people without pre-existing conditions, and so on.
As you know, plan cancellations have been a source of tremendous controversy—and, for the president, immense political grief. Some estimates have suggested several million people received these cancellation notices. The vast majority of those people have already found new coverage, either directly through insurers or through one of the Obamacare exchange websites, according to the Administration. While some are paying more money, others have discovered that the new policies are cheaper—or, at least, are grateful for the extra protection. Lucia Graves of National Journal wrote about some of their stories the other day.
But some people still haven’t found insurance. Administration officials think, based on conversations with state regulators and insurers, that about half a million people fall into this category. That’s half a million people who could, because of the individual mandate, face tax penalties because they have declined to get affordable coverage.
Now, however, people with cancelled policies have a new option. The individual mandate has always contained a hardship exemption: If you qualify for it, you don’t have to pay the penalty and you have access to the cheaper, slightly less comprehensive catastrophic insurance plans otherwise available only to people under 30. The only question with the hardship exemption has been who gets it. The law gives the administration flexibility over that question and, on Thursday, Health and Human Services Secretary Kathleen Sebelius announced that it would apply to people who just lost their policies and are unable to find replacements that cost the same or less money.
HHS made the announcement by posting a guidance and sending a letter to a half-dozen more conservative members of the Senate Democratic caucus. And neither document answers all of the relevant questions, like how strictly the government will apply the new criteria or for how long this exemption will last. (Administration officials say it will be temporary.)
Conceptually, making the change is not so different from allowing more people to have grandfather protection for their existing coverage—after all, it’s basically telling people who have bare-bones coverage now that they can take out bare-bones policies next year. And imposition of the individual mandate was always supposed to be a gradual process. The financial penalty starts out relatively low, but will increase in 2015 and 2016. The administrative flexibility over the hardship exemption was designed to give the administration some leeway over enforcing the mandate, particularly early on, in order to ease the transition to a new and reformed insurance market. (The Massachusetts reforms, which were a model for the Affordable Care Act, also included a hardship exemption and called for increasing penalties over time.)
Administration officials don’t seem to think many people will take up this new option. They are probably right about that. Catastrophic policies aren’t dramatically different in coverage from the “bronze” policies, which cover 60 percent of the typical person’s medical expenses and comply with all Obamacare requirements. But if you buy a catastrophic policy, you’re not eligible for federal tax credits. If you buy a bronze policy, you are. As a result, most lower- and middle-income people would probably still find the bronze policies a better deal.
Still, some people—primarily, the ones who don’t qualify for subsidies—will opt for the catastrophic policies because they will be moderately cheaper. And some people will opt not to get insurance at all. That will mean fewer people in good health paying premiums for the exchange policies. That’s a potential problem for insurers, who count upon those premiums to offset the medical bills of people in poor health. (For health policy wonks: The catastrophic policies are an independent risk pool, separate from other policies in the exchanges. So for every person who selects one of those policies, that’s one fewer person putting premiums into the larger pot of money for the exchange policies.) There’s also a danger that, as Ezra Klein points out, the administration will come under more pressure to pull back on the mandate for other people. “This latest rule change could cause significant instability in the marketplace and lead to further confusion and disruption for consumers,” said Karen Ignani, president of America’s Health Insurance Plans.
Yes, insurers say those sorts of things all the time. And this singular change probably won’t cause serious, irreparable harm, any more than any of the previous ones did. The number of people whose behavior changes is likely to be small and the new system is more resilient than most people realize. But even minor changes can become major if there are enough of them.
Note: This item has been updated. As a friend reminds me, even the catastrophic plans under Obamacare aren’t that skimpy. They still cover all essential benefits, for example, and the actuarial value really isn’t much different from bronze plans.
By: Jonathan Cohn, The New Republic, December 21, 2013
“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
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