A common talking point is that the ACA is imploding, or that it’s unpopular. It is useful to consult actual data and expert opinion when listening to such arguments.
From the CBO:
Under Current Law. Although premiums have been rising under current law, most subsidized enrollees purchasing health insurance coverage in the nongroup market are largely insulated from increases in premiums because their out-of-pocket payments for premiums are based on a percentage of their income; the government pays the difference between that percentage and the premiums for a reference plan (which is the secondlowest-cost plan in their area providing specified benefits). The subsidies to purchase coverage, combined with the effects of the individual mandate, which requires most individuals to obtain insurance or pay a penalty, are anticipated to cause sufficient demand for insurance by enough people, including people with low health care expenditures, for the market to be stable in most areas.
Nevertheless, a small number of people live in areas of the country that have limited participation by insurers in the nongroup market under current law. Several factors may lead insurers to withdraw from the market—including lack of profitability and substantial uncertainty about enforcement of the individual mandate and about future payments of
the cost-sharing subsidies to reduce out-of-pocket payments for people who enroll in nongroup coverage through the marketplaces established by the ACA.
It is of interest to note that the withdrawal of insurers from certain markets is due to policy uncertainty induced by the current Administration’s refusal to guarantee payments of subsidies to insurers.
What about popularity?
This graph compiled by Goldman Sachs is useful for documenting the relative popularity of the current law.
Source: Phillips, “US Daily: Health Legislation: Nearing the End,” Goldman Sachs, June 27, 2017.
So, the ACA could be repaired with some feasible modifications. The ACA is popular. More so than the House-passed AHCA (for which we have polling data).
So…the question remains, why push a massive tax cut for high income households in exchange for massive cuts in Medicaid spending and elevated mortality levels?.
Obamacare was a failure before Trump was elected. If you don’t believe me, maybe you’ll believe the Chicago Tribune editorial board:
https://www.google.com/amp/www.chicagotribune.com/news/opinion/editorials/ct-obamacare-fail-health-care-insurance-medicine-0911-jm-20160909-story,amp.html
So you’ve found an opinion piece that suits you, and suggest we all believe it, rather than simply believing you. When it comes to Obamacare, anyone can find an opinion piece that suits them, so you really haven’t done anything but ask us to believe you. Not even a clever trick.
And oh, yeah, you are countering data, as offered in the post, with opinion. Sounds like the usual brew from the right. Also not a clever trick.
It’s not clever blaming the right for what the left thinks.
PeakTrader As usual, you link to some pretty lame arguments. The Tribune’s editorial is shot through with contradictions and bad reasoning. I can’t cover all of the problems with this editorial, so I’ll just hit the lowlights.
(1) On the one hand the editorial criticizes Obamacare for “straightjacketing” insurers into providing “soup-to-nuts” coverage plans that didn’t allow consumers to order ala carte. But then just three paragraphs later they tell us that Obamacare failed because “it allowed Americans to sign up after they got sick and needed help paying all those medical bills.” I’m hoping you can see the obvious contradiction here. Allowing an ala carte approach (which the editorial endorses) is economically the same as allowing people to sign up after they are sick. The Tribune is trying to have it both ways.
(2) The Tribune criticizes Obamacare for setting too low of a penalty for not buying insurance. I agree. But I don’t recall hearing the Tribune and conservatives arguing for a higher penalty back when Obamacare was being debated. My recollection is that they wanted a zero penalty and even went to the Supreme Court over the issue. So while I agree that the penalty is too low, it’s dishonest for conservatives to raise it as an objection now when all along they were arguing that it should be abolished altogether. Intellectual honesty ought to count for something.
(3) Their argument about risk pools is confused. Risk pools are not just about pooling the lucky and unlucky; they also have to be intertemporally consistent. There are actually two risk pools: the healthy and unhealthy as well as the old and not-yet-old. Eventually (almost) everyone transitions from the not-yet-old to the old. That means people have to smooth costs over their lifetime; i.e., they need to be lumped in the same risk pool although the premiums can be discounted to account for different time horizons when subscribers will make claims. Obamacare allows a 3:1 cost differential. The GOP plan allows 5:1. No one seems to dispute that there has to be a cost differential and that the not-yet-old must subsidize the old. The issue is whether the ratio should be 3:1, 5:1 or some other ratio. Reasonable people can differ here, but the ACA ratio of 3:1at least has the benefit of economic analysis behind it. The GOP differential smells like a purely political trick intended to further undermine the parts of Obamacare that require 60 votes to overturn.
(4) According to the Tribune insurers cannot turn a profit under Obamacare. This is false. It was true the first few years, but by 2016 some insurers were finding Obamacare mildly profitable. Things were looking pretty good for 2017 and 2018 until the GOP threatened to sabotage things.
(5) The Tribune thinks allowing insurers to go across state lines will lower premiums. In principle this sounds like a great idea. In fact, this was an early component of Obamacare; however, eventually 30 years of economic research on the question convinced Obama that it was a bad idea. Both academic economists and the insurance companies opposed it. Why? Because most of the “value added” by private insurers is in understanding local rates and local healthcare providers. Insurance companies negotiate locally, not nationally or across state lines. It’s inefficient and would drive up costs. An insurance company based in New Jersey does not an cannot efficiently understand and negotiate rates with healthcare providers in Nevada. This is something that’s been known by healthcare economists for 30 years. The only companies that would go across state boundaries would be companies that were selling fraudulent policies…very much like what we see today with car repair insurance across state boundaries. All of them are fraudulent.
There’s a helluva lot more that’s wrong with the Tribune’s editorial, but this post is already approaching Rick Stryker length.
Why pay premiums when you don’t have to. And, since premiums have been skyrocketing, you’d think insurers would be making a profit by now. Insurers have an excellent understanding of data, regardless of the state, and if you move to another state, why not keep the insurance plan?
“if you move to another state, why not keep the insurance plan?”
this issue is well understood by health economists. by questioning this item, you show your ignorance of the economics of health insurance. rather than continue to post uninformed on this site, please sit back and learn. slugs already explained this to you.
So the gullible (raise your hand) and the uber gullible (raise both hands) buy into seven years worth of “there’s a better plan a comin, Lord, just you wait and see!”
Then a pied piper comes along (hands now raised skyward as you start jumping toward the heavens) who promises cheaper, better coverage for everybody, no cuts in the safety net, patient centered, market basedplan ready on day one.
But, after 84 months, there is no plan, and the piper solemnly asks “Who knew health care could be so completed?” (Quick answer: other than the millions who had no insurance and the millions who deal personally with medical insurance roadblocks, probably those who have “people” to solve the complexities for them)
But not to worry. We’ve now got a plan, written in secret, drawn up by 11 guys who’ve never had to worry much about coverage for themselves or their families. (Hands still raised, kisses blown to these prescient gurus) Oh sure, the nattering nabobs of negativism at the CBO think they know everything as do all those lying medical and hospital professionals who believe the proposed plan stinks.
But this plan is a sure fire success. How do we know? Because the 11 guys and their cohorts (who many people wouldn’t trust to sell them a used car) said so.
That’s why that that new Ford Focus they’ say they’re selling looks exactly like a Yugo.
Why drop the ACA?
Because of liberty, because of free markets, because of competition, because of freedom of choice among many plans, that may or may not be the liking of techno-bureaucrats in Washington and at MIT.
I know that talk like this is anathema to many in this blog.
The ACA is suddenly popular? Of course, many people want free stuff, they like their Medicaid subsidies, they like the subsidies to their plans, all paid by “somebody else”.
Unfortunately, this mindset of free stuff combined with an anti-liberty attitude is becoming very pervasive in Econ academia, especially in some “Public Policy” Schools.
Menzie,
These are not talking points. The ACA is imploding and has only become more popular recently because people have been spooked by the scary headlines that tens of millions of people will lose their health insurance if the ACA is replaced.
The CBO is probably right that the market will ultimately stabilize, but it will be a perverse stability in which a small group of the very poor and the very sick are covered by insurance that has poor benefits and is much too expensive for anyone in the unsubsidized market to purchase. As I and others have pointed out over the years, the ACA provides very weak incentives (e.g. weak penalties) to purchase an expensive and highly regulated product that has more “benefits” than many people, especially young people, want or need. Not surprisingly, the take up rate has been much lower than the Administration or the CBO expected, requiring premium rate increases and reduction of benefits, which creates a cycle in which more unsubsidized people drop out of the market, requiring more premium increases and benefit reductions (e.g. high deductibles). Most likely, this will stabilize with fewer people than are now on the exchanges covered by insurance that is much too expensive for anyone other than those who are very poor and thus getting a subsidy or already very sick. As I’ve been saying over and over, this situation must be fixed.
Republicans are trying to fix this situation but have been hampered not only by Democratic obstructionism but also by the alarming CBO estimates of the number of people who will lose their insurance if the ACA is repealed. I have commented before on the dangers of annointing any group, not matter how non-partisan or well-intentioned, as the sole arbiter of the effects of complex policies. The public hears that the non-partisan CBO has decreed that 22 million people will lose their insurance and naturally they will give that estimate a lot of credibility. The mainstream media, which is fighting very hard to stop Trump, naturally repeats those estimates over and over. But how credible are they really?
Not very credible when you look closely. Because they have overestimated the power of the weak ACA penalties, the CBO has consistently overestimated the number of people covered on the exchanges. In their re-forecasts, the CBO has been forced by the facts to lower their estimates, but they’ve still always been biased high. And the CBO has underestimated the incentive effects of free policies, thus underestimating the take up of medicaid. These tendencies has caused them to badly miss the mark in their analysis of the Republican plans.
Even though the ACA will likely stabilize with a number of enrollees below that on the exchanges today, the CBO believes that the number on the exchange will actually climb to 18 or 19 million from the 10 or 11 million now. That assumption matters since the CBO’s analysis is with respect to their March 2016 baseline, which contains the 18 or 19 million forecast. Thus 8 or 9 million of the people who supposedly will lose their insurance under a Republican alternative is based on the CBO’s forecast of a susbstantial increase in ACA enrollment, which is belied by the facts.
Even though the mandate has shown itself to be very weak and the market is imploding towards a perverse equilibrium, the CBO believes that elimination of the mandate is a primary cause of the loss of coverage they project. In 2018, they expect enrollment to decline by 15 million overall. 7 million of that decline is in the non-group market because of the absence of the mandate in the CBO’s view. 4 million of that number would be a decline in medicaid enrollment. Amazingly, the CBO believes that the mandate causes people to enroll in medicaid, which is free for them, even though the CBO has consistently underestimated the medicaid take up rate of this free benefit.
Even more amazingly, part of that 4 million decline in medicaid is accounted for by states that, in CBO’s view, would have adopted the medicaid option going forward in the absence of any change to the ACA. So, get this: CBO believes that Republican governors in red states are going to change their minds and take up the medicaid option at a time when a Republican President and a Republican Congress are working to repeal and replace the program! The CBO is actually counting as lost coverage the fact that these governors will not take up the medicaid option if the ACA is changed. Surreal.
What’s worse, the CBO analysis is based on a very limited picture. For parliamentary reasons, the Senate has not yet put in policies limiting the ability of people to buy insurance only when needed. Also, since Democrats are not cooperating, the Congress is forced to reform the program in stages. This first stage can only make changes that have budgetary consequences to avoid the filibuster. Stage 2 would include regulatory reform and stage 3 would include new legislation.
Given the dubious assumptions that CBO is making in its analysis as well as its failure to include features that are coming, we have to take its analysis with a grain of salt. The truth is no one at this stage can make any credible estimates of the effects of the Republican health care reforms. And yet, the CBO has been annointed to be the scorekeeper on this very complex legislation, imparting on them a credibilty that neither they nor anyone else should have.
If the public understood that the scary estimates of coverage loss aren’t really credible, the polls would not be showing a recent uptick in the popularity of the ACA. The scary numbers have convinced some people that there may not be an alternative to the ACA they will like and so many people are taking the position that they approve the ACA but want it fixed. That’s what the polls are saying.
Imploding? Is that a technical term?
CBO assumptions are “dubious”. Coverage loss estimates “aren’t really credible”. Estimates that involve assumptions which you don’t like about state government behavior are “surreal”. Those must be technical terms, as well.
What astounds me is that you can write nearly a thousand words of this stuff without actually offering a single unbiased fact. Jeez, that’s so 2016. Reality is sinking in and you think the same tricks that worked last year still work now? Sad.
“Unbiased fact?” Is that a technical term? I thought facts were not biased by definition.
I have included quite a few facts, arguments, numbers, and CBO assumptions pulled right from their documents. If you don’t agree they are facts, then present your case.
Rick Stryker: Pretty rich coming from the guy/gal who asserted that President Trump was right when he said the crowd at his inauguration was larger than at Obama’s first inauguration.
By the way, do you still believe that 500,000 is the normal rate of job creation in a recovery? Every day, I think of that statement, and I laugh and laugh and laugh. You are the gift that keeps on giving.
Umm…Menzie, you realize that I actually said in that thread that “VOX speculates that the number is between 250K and 1.5 million. Who knows, but I’d think there are a number of reasons to think that Obama’s 2009 inauguration had more people:”
Umm…Menzie, you realize that you linked to a post in which I NEVER SAID THAT 500k IS THE NORMAL JOB CREATION RATE DURING A RECOVERY.
Rick Stryker: What you’ve written stays in existence. See this comment on May 5, 2012:
And so I laugh every day I think about your comments, and what passes for “analysis” in your mind.
Rick Stryker If the ACA does implode, it will be because the GOP worked overtime to make sure that happened. The fact is that by 2016 the exchanges had pretty much stabilized and were mildly profitable for most insurers. The ACA certainly needed some tweaks…name me a big program that got it exactly right straight out of the box! Over the years we’ve had to tweak Social Security, Medicare, Medicaid, income tax rates, deductions, capital gains, tariffs, etc. The needed fixes to the ACA were fairly straightforward and not all that expensive. Some of the unsubsidized premiums spiked in 2017, but that was a one-time anticipated event built into the legislation. The ACA gave insurers and subscribers a “warm up” period to allow insurers the opportunity to discover the health risks of folks on the exchanges.
The health insurance regime that really was imploding was what we had pre-ACA. Or is your memory that short? That system was truly in a death spiral. The GOP plans are even worse than what we had pre-ACA.
the CBO has been annointed to be the scorekeeper on this very complex legislation, imparting on them a credibilty that neither they nor anyone else should have.
Well, the CBO certainly has more expertise and credibility than you or Trump or Ryan or McConnell. Or any of the fake right wing think tanks acting as hired guns for the GOP. The CBO’s analysis is pretty much in line with academic and legitimate think tanks analyses.
As to alternatives to the ACA…if Obamacare is sabotaged by Team GOP, then the next stop will be single payer. Some of the smarter conservatives know this.
Menzie,
In your comment, let’s first note that you pass over in silence without any acknowledgment or apology that I actually said the opposite of what you claimed I said on the size of Trump’s crowd.
At this point, you are being deliberately obtuse on the other question. Where do I say in that quote that “500K is the normal job creation rate during a recovery?” I don’t. It’s clear in that quote I don’t believe that since I said “Even if he gets 12 months X 500K per month, which is more than we saw in the early 80s recovery..” so clearly I’m not claiming that 500K is normal. Moreover, in my first comment in that thread, I also said “Admittedly, the last time we saw sustained increases of 0.38% of current labor market levels was during the recovery from the 1982 recession. But that just implies that Romney is setting an ambitious but not historically unreasonable employment goal.” So clearly once again, I’m not claiming that 500K is normal.
We have only been talking about what is a reasonable goal, not about what typically happens. You acknowledged that point in your reply to my comment when you said “Ambitious, yes. Reasonable? Like Governor Romney’s 4% unemployment rate, which Doug Holtz-Eakin characterized as… well you read it yourself here. I look forward to your next comment, so I can get a good chuckle.”
Well, I’m the guy getting the good chuckle. What’s the current unemployment rate Menzie?
Rick Stryker: Well, let’s quote you again:
If I say, “It looks like 1.5 million”, is the weasel word you’re focusing on “looks” so the President is not claiming 1.5 million. So it is “fake news” to say the President claims 1.5 million when he says it “looks” like 1.5 million? I think reasonable person reading that would say that’s a claim.
I look forward to your defense of the President as somebody who is completely respectful of women in his public discourse. I’m sure you would believe it.
Regarding 500,000, please keep on trying to wiggle out. But anybody who reads your comments knows you were defending the Romney 500,000/mo claim (until at least he changed w/o comment to 250,000 — something you never explained when I asked you about that).
But thanks, now I have re-acquainted myself with the links to your comments, I am working up a Rick Stryker Memorial post on Fantastical Analysis. It will be long.
Menzie,
On the crowd size, your original claim was ” Pretty rich coming from the guy/gal who asserted that President Trump was right when he said the crowd at his inauguration was larger than at Obama’s first inauguration.” But I did not assert that Trump was right about his crowd size. In fact, I asserted that he was likely wrong about that and gave the reasons. I gave you the quote. You need to acknowledge that you made a false charge.
You also need to acknowledge you have persistently made a false charge on the 500K thing. I’ve tried to ignore it over the years, not wanting to get drawn in to a meaningless argument. For the umpteenth time, I never said that 500K job growth was normal in a recovery. In fact, I quoted myself above saying it was abnormal. You are now reduced to saying that people who read what I wrote know what I really meant, despite what I actually said.
Rick Stryker: You said the NYT was wrong in asserting the crowd sizes differed. You said Vox was purveying in “fake news” by claiming the President indicated a crowd size of 1.5m– but it seems Vox was exactly citing as a normal person would the claim the President made of “it seems”. Geez. Double geez.
We have your multiple quotes indicating that 500,000 expressed as percentage was reasonable. I’m just saying that is a stupid statement.
But I did promise to compile all your absurdities for everybody to read. This will then be a useful archive for when your true identity if finally revealed.
OK, you are not going to apologize for the false charges but have pivoted to some new ones. That’s to be expected I suppose.
Rick Stryker: Sorry, I apologize for saying you were on-board with Trump’s estimate. I do not apologize for your weaseling out of your claim that Vox lied. On that, I see no response. Nor is any reasonable one feasible.
500,000, on the other hand, is clear as day as something you defended.
Ha. Megapixel Stryker who has debased and humiliated himself before his Dear Leader with his claims of FakeNews! demands an apology!
He defends his Lying Leader’s claims of crowd size when everyone can see with their own two eyes that he is lying. He has Megapixel photos in his defense! He denies his Lying Leader’s claims of 4% growth when everyone can see it with their own two eyes in black and white on his own White House web page.
Megapixel Stryker has taken on Trump’s tactics of lie, lie, lie and deny, even when the facts are plainly visible to everyone.
It must be humiliating to debase yourself at the feet of your Dear Leader, but there is no going back after you have crossed to the dark side. You have to stubbornly plunge on with lie, lie, lie and deny, bleating FakeNews! like a moron, just as your Dear Leader does.
It’s quite clear at this point that Donald Trump is mentally ill and suffering from dementia just as his father did. Everyone knows it but is afraid to say it, just like the naked emperor’s new clothes.
Megapixel Stryker will defend him to the bitter end because he has no alternative at this point.
Menzie,
When did I “weasel out” of my claim that Vox “lied?” I don’t know what you are referring to. As best I can recall, I think I said Vox was wrong, not that they lied. This is another pointless argument, like the 500K nonsense. I asked you a serious question on why our ethical obligations stop at the border in a foolish attempt to raise the level of the debate and this is what you want to talk about.
rick, your “pointless argument” comment is a direct result of your actions. you deliberately come onto this blog to troll inaccurate narratives to support your conservative agenda. you consistently bend the facts to support your ideology while criticizing what is actually occurring. if you want to raise the level of debate, you need to eliminate the hackery that you put on this blog. then people will take you seriously. or you can continue your past practices and cry foul when called out as a hack. your choice i guess.