Read This Now: Great Piece on Obamacare

December 16th, 2013 at 9:55 am

This National Journal piece makes many great points about Obamacare as political football.  It’s predictable that this would be the case, and no question that the administration has kicked the ball in their own goal more than once (apologies re mixed sports metaphors).

But aside from the obvious mistakes of the bad website rollout and the “you can keep what you have” claim, much of what opponents are trying to pin on the ACA is less about the ACA than about a) what happens when policy tries to squeeze inefficiencies out of the uniquely inefficient American health care system, and b) ongoing trends that were already in motion.

Read it yourself, but a few key points:

–every insurance plan works by pooling risk; in health coverage, the healthy subsidize the sick; broadly speaking, the folks less likely to generate costs regarding the thing you’re insuring against subsidize the ones more likely to do so.

–plans with low premiums have high deductibles; and let’s be very, very clear about this next point: every conservative health reform plan that talks about lowering cost growth in health care by increasing the skin in the game of the insured taps this dynamic.

–health costs have been rising quickly for a long time both here and in every other advanced economy; neither the  ACA nor any other plan was ever going to change that.  The goal is to lower the rate of growth, and that’s actually happening, with what looks like the ACA’s fingerprints on recent efficiency gains in health care delivery emphasizing incentives on quality of care over quantity (as the piece points out, this includes the shift to narrower provider networks).

No question that transitioning to even a moderately reformed health care system–one that maintains the fundamentals of the existing system, especially private insurers (vs. single gov’t payer)–will generate significant disruptions and some will face new costs.  That had to happen given the unsustainability of the existing system.

The smart move would be to work together to get the reforms in place, including evaluating effectiveness as we go and when needed, getting under the hood to fix parts that aren’t working.   I’m mildly optimistic that even with all the noise, that’s going to happen.  But the noise is sure…um…noisy.

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2 comments in reply to "Read This Now: Great Piece on Obamacare"

  1. save_the_rustbelt says:

    PPACA was designed to be “disruptive,” and that was needed, but I don’t think Obama-Reid-Pelosi understood the bill or the degree of disruption.

    While the country focuses on the real disruption is happening in the provider and private insurance sectors, and it is taking on the characteristics of an avalanche, no one can control it and no one knows when it will stop.

    I’ve worked with providers from about 40 states this year and no one knows where this will be three years from now or what will still be working and what will be destroyed.

    Stay tuned.

  2. Peter K. says:

    Take everything Rusty above says with a grain of salt. Too bad he doesn’t have a website which would let the uninitiated easily learn his assumptions and prejudices. At least he uses the same handle when commenting.

    The Wall Street Journal is reporting that the insurance industry will spend hundreds of millions on advertising to get people to sign up.