Was the Nov. 30 Deadline the Make-or-Break Moment for Obamacare? No . . .
Somewhere in the future months, one of us is going to have to eat crow here on the success of the PPACA. The Republicans, Teabaggers, Healthcare Insurance Companies, Gerrymandered Republican Districts, ALEC, Koch Bros, etc. are working their hardest to make this much needed change in how people gain coverage fail. Meanwhile healthcare insurance companies are scamming the public with the cancellation of policies they should have never written after 2010 and are increasing policy premiums in spite of the MLR. Its the PPACA’s fault . . .
In my own state of Michigan, 315,000 people, a minority of the 9 million voters, have signed a petition to force women who want abortion coverage to seek a rider to their policy independent of PPACA coverage. Given that the state has refused to set up a state exchange and has used the Federal Exchange adding to the overloading of it, I wonder how the Federal Government will weigh in on this silliness. This petition is dangerous as it will not be put to vote on the November 2014 ballot. Instead, it will go to the Republican controlled legislature to decide whether it becomes law of not and bypass the Republican governor who vetoed a similar bill. Michigan has quite a few laws which beg for Federal review. Most recently, The state Attorney General decided he would not review juveniles sentenced to life imprisonment without parole claiming it only applies to future trials. Huh????
Maggie Mahar does a good review of the current PPACA deadline which warrants greater acknowledgement.
Was the Nov. 30 Deadline the Make-or-Break Moment for Obamacare? No . . .
Why March 31 is Far More Important –Particularly for Younger Americans
The media has described November 30 as the administration’s “self-imposed” enrollment deadline, but conservatives—and the media itself—insisted on a date, demanding, over and over again, that the administration answer the “$400 million question”:
How long will it take to fix the Federal Exchange?
Ultimately, Jeffrey Zients, the Obama administration’s new health-care website, promised the site would be “generally operational” for “the vast majority of users” by the end of November.” No one quite knew what that meant. But immediately, the media turned the November 30 deadline into a headline. On November 28,CNN declared: “A moment of truth approaches for President Barack Obama’s signature health care reforms with Saturday’s self-imposed deadline to get the website to work properly for most users.”
Reuters chimed in: “President Barack Obama’s healthcare law is facing its biggest test this weekend since its disastrous October 1 launch . . . If the website does not work on Saturday’s deadline, that could turn off millions of uninsured Americans, especially young and healthy consumers whose participation in the new insurance exchanges are critical.”
Where, I wondered, is Reuters getting its information? From Fox News?
Younger Americans Are Not as Intimidated by Website Snags
There is absolutely no reason to think that 20-something and 30-somethings are more frustrated with the technical glitches than anyone else. There is, in fact, every reason to think that young Americans are not nearly as bothered by software bugs.
First, keep in mind that most Millennials haven’t even tried to sign up. This is because they are not as anxious as older, sicker Americans about securing insurance.
But when they do go to the Healthcare.gov website, a twenty-something is likely to have an easier time than a 50-something when trying to work his way around glitches. Unlike many of their elders, Millennials solve software snags every day – at home, at work, at school. Twenty-five-year-olds who have grappled with Windows 8 will not be daunted–or surprised—by a few bugs. For many younger Americans working through such problems is almost intuitive.
This also helps explain why, despite the sustained bad-news blitz, a CNN poll released just last week shows 18-34-year-olds overwhelmingly believe the president’s healthcare law will work: “Seven in 10 younger Americans think the current problems faced by Obamacare will eventually be fixed. Senior citizens are split, and most people between 35 and 65 years old think that the system is permanently broken,” said CNN Polling Director Keating Holland. . (So much for 35-65 year boomers. Some of the folks in my generation are getting grumpy).
The Success of Reform Turns On the Health of Those Who Sign Up
Keep in mind that 18-34-year-olds are needed to make the Exchanges work. As Ezra Klein pointed out recently, what matters most is not the absolute number of Americans who join the Exchanges this first year, but who they are. He explains: “Back in July, when Sarah Kliff and I asked the White House how they defined ‘success’ in 2014, they always defined it as a function of the mix of people in the exchanges . . . rather than the number of people in the exchanges . . . More wasn’t necessarily better. Twenty million enrollees would be a disaster if only 1 million of them were young and healthy. . .
“If they got 10 million people to sign up, about 3.9 million had to be young and healthy. If they got 4 million to sign up, success would mean making sure 1.5 million were young and healthy.. . . so long as the ratio was right, the premiums will remain low, and so when people eventually come to buy insurance, they can get a good deal, and they’ll want to sign up.”
In other words, it doesn’t matter whether 7 million or 5 million Americans join the Exchange this year. If enough 20 and 30-something’s join the risk pool, this will ensure that premiums are as low in 2015–or even lower– than they were in in 2014. This is the scenario that reform’s opponents fear most..
Many Young Americans Will Wait Until March
Those who argue that reform is a “failure” because October and November enrollments remain low emphasize that if potential Obamacare customers haven’t signed up by the end of November they will have only 23 shopping days left if they want be covered by January 1.
But many hale and hardy 20-somethings don’t really care whether they are insured by the first of the year. They just want to avoid forking over $95 because they decided to ignore the mandate that they purchase coverage. In that case, they have until March 31. That is when open enrollment ends—and when the penalty kicks in for those who decide not to buy insurance.
What Happened When Massachusetts Mandated That Its Citizens Buy Healthcare?
Massachusetts’ experience suggests that, for young healthy Americans—the folks we need to keep premiums at reasonable levels– March 31 is the most important deadline
In Massachusetts enrollment in Commonwealth Care began in March of 2007. The state mandated that but the state’s citizens wouldn’t have to pay a $291 penalty if they purchased insurance by November of 2007.A study published in the New England Journal of Medicine shows just how important that November deadline was.
Researchers began by separating enrollees into two groups—those who were healthy when the joined Commonwealth Care, and those who were not. Using claims data from the first year that these patients were part of Commonwealth Care, they measured the health mix of the population who had enrolled from March 2007 through June 2008, looking at average age, average monthly health care expenditures, and the proportion of enrollees suffering from a chronic illness. We identified patients as having a chronic illness if within the first 12 months after enrollment they had an office visit at which a diagnosis of hypertension, high cholesterol level, diabetes, asthma, arthritis, an affective disorder, or gastritis was recorded
The chart below reveals the enormous spike in the number of healthy applicants joining the program in November–just in time to dodge the penalty. That month, there was a much smaller increase in the number of chronically ill people signing up for insurance. Many already had purchased insurance.
< a href=”http://www.nejm.org/doi/full/10.1056/NEJMp1013067″>
The chart also shows that the number of healthy applicants continued to outpace sicker applicants for another six months. Clearly the mandate made a huge difference in ensuring that younger customers joined the pool. I suspect that over the next four months, we’ll see the same pattern nationwide.. I don’t expect to see most Millennials scrambling to buy insurance in December. Very likely, the bigger spike will come in March. This is why MIT’s Jon Guber an architect of Massachusetts Reform, plan calls the October and November Obamacare enrollment figures “basically meaningless”:
“Look, when we opened our system in Massachusetts the first month the people could pay premiums and enroll, 123 people enrolled,” Gruber points out ”By the end of the year, it was 36,000. That meant we got .3 percent of the people the first month. By that standard the federal government did great, 1.3 percent of the people the first month. It’s too early to say anything useful. The real deadline we have to focus on is March of next year.”
I agree. When we look at who has signed up at the end March, we will be able to assess how well reform is doing—and how likely it is that premiums will rise in 2015.
Even is healthcare.gov is wildly successful, it is one scene in a much bigger drama.
Like an iceberg, most of the really interesting events are still under the water. This media/political uproar is a small distraction.
STR:
I pretty much know which side of the road I am on with the PPACA while you smirk and giggle at the issues many of the uninsured face daily. Healthcare Insurance is the dinosaur in the room STR.
In the bigger scheme of things and in the long run the biggest change ushered in by PPACA is the expansion of Medicaid to 133% of FPL. Something I expect Red State governors understand and the reason they are turning down billions of medium term dollars.
Because once the principle that some Americans get health care by simple right (Medicaid) and those the working poor and others get it by dint of working at least 10 years prior to retirement age (Medicare) the the obvious mitigating measure for Exchange failures for the not so poor working class and the not quite retired workers is to expand the one up the income scale and the other down the age scale. As opposed to say responding to that failure by rolling back Medicaid.
So the more that Big insurance and providers try to exploit gaps in Obamacare or even to sabotage it the more likely they are to see their customer base be moved out of the system altogether.
For example there is a prevailing notion that the Exchanges will never quite work for small business (leading to the current one year delay) because the incentives are to dump those plans and send their workers to Medicaid or to largley subsidized Exchange Plans. To which us not so secret Single Payer folks shout Hallelujah! Because that is the kind of market failure that works in our direction.
Medicaid expansion up the income ladder and extended to single adults is the true camel’s nose under the tent in this. Something those Red State governors seem to understand full well. So far they were given a reprieve by the Supreme Court but at some point poor people in Red States will realize that poor (and browner) people in Blue States are getting coverage on the national dime and they aren’t. We’ll see how long that Red-Blue split can maintain itself. I mean at some point even Red Staters are going to get tired of Fundraiser Jars at the market to get donations for little Sally’s cancer surgery when such become unimaginable even in the poorest neighborhoods of Los Angeles and NYC.
Ironically this mirrors the myth that theire is a secret welfare system that only Blah and Brah people have access to that buys them steaks and Cadillacs and Obamaphones. Because when it comes to medical care that parallel system will be an actual reality in States that accepted Medicaid expansion against those who refused it. Sweet irony indeed.
About the graph of new enrollees: its not the absolute difference in enrollment in November that matters, but the relative change. After all, if the chronically ill are a smaller percentage of possible enrolees, then we might expect their absolute numbers of new enrollments to be fewer too, under the null hypothesis that the healthy and chronically ill enroll at tge same rate.
In November the enrollment of tge chronically ill doubled, and the healthy enrollment numbers tripled, so the authors point remains valid.
For the money they spent on HealthCare.gov, every American could’ve had free open heart surgery:
http://about.bgov.com/2013-10-24/late-it-cash-surge-foreshadowed-health-law-woes/
Well, I sympathize cynthia, and a crash program costs a lot for a crash. On the other hand, I don’t get your pricing on surgery….there is quite a spread of prices http://www.nytimes.com/2013/12/03/health/as-hospital-costs-soar-single-stitch-tops-500.html …is the heart surgery done in India?
Cynthia:
For the $200 million/year the TSA spent since 2007 on trying to identify terrorists by talking to them, we could have funded healthcare for one year including the open heart operations.
http://abcnews.go.com/Blotter/sentinel-decade-451m-fbi-computers-now-working/story?id=16904032
The FBI spent a decade and $451 million just to upgrade and interconnect existing computer systems. Which I guess would have paid for all those heart surgeries PLUS gall bladder surgeries and liver transplants.
Yet I here no cries for the FBI to be disbanded.
The fundamental problem is what AB contributer Noni called ‘the ‘illions’ http://angrybearblog.strategydemo.com/2009/01/illions-by-volume-area-and-time.html
The Right freaks out over a $500,000 Las Vegas conference by the GSA (a half of a M-illion) or a $1 million dollar earmark for some upstate museum for Woodstock (because sponsored by Hillary when Senator) but doesn’t blink when the have an F-35 fighter program more than a $100 billion over budget to date.
$100 billion is 100,000 million or 200,000X the cost of that Conference yet where is Inquistor-Clown Darrel Issa sending his investigors?
And the same for this tech project. We were spending a billion a day in Afghanistan and Iraq at the peak or three times the cost of this entire IT project to date but gosh building schools for Iraqi schoolchildren is more important than health care for American kids. Because Freedom.
I told a joke back in the day that made even the most wingnuttiest warmongerig work colleagues laugh:
“Hey I got great news and bad news!”
“Yeah, what is the great news?”
“President Bush just came out for universal health care backed by a Consitutional guarantee!!!”
“Well what is the bad news?”
“Its for Iraqis and enshrined in the U.S. supplied provisional Iraqi Constitution and not for us”.
Which is a true story. Bush and Cheney demanded universal single payer health care. For Iraq. Because it was the right thing to do. I guess. And certainly they didn’t blink when $300 million plus in palleted $100 bills dissapeared on a regular basis. Yet somehow spending $300 million on a health care IT project designed to serve up to 14 million Americans is a damn outrage requiring us to abandon the entire project.
Because ” ‘illions’ “. And look at all those zeros!!
(I am not sure whether it is Crocodile Tears or Reptilian Minds at work here, either way Higher Math skills don’t seem to come into play)