Debating the PPACA

by Dave Schuler on January 22, 2014

Megan McArdle recounts her formal debate of the viability of the PPACA, she and Scott Gottlieb taking the affirmative (that the PPACA is not viable) and Jonathan Chait and Douglas Kamerow taking the negative. The affirmative prevailed even before what was probably an unsympathetic audience:

What was the winning argument? We argued that the Patient Protection and Affordable Care Act is an unstable program that doesn’t deliver what was expected. For a lot of people, that hardly needs proving, given all the recent technical and legal gyrations. But for others, it does, and because most of them weren’t at the debate, let me elaborate. Scott spoke eloquently about the ways in which narrow networks and the focus on Medicaid are going to deliver an unacceptable quality of care. I talked about why this, among other things, makes the system so unstable.

In a nutshell, Obamacare has so far fallen dramatically short of what was expected — technically, and in almost every other way. Enrollment is below expectations: According to the data we have so far, more than half of the much-touted Medicaid expansion came from people who were already eligible before the health-care law passed, and this weekend, the Wall Street Journal reported that the overwhelming majority of people buying insurance through the exchanges seem to be folks who already had insurance. Coverage is less generous than many people expected, with narrower provider networks and higher deductibles. The promised $2,500 that the average family was told they could save on premiums has predictably failed to materialize. And of course, we now know that if you like your doctor and plan, there is no reason to think you can keep them. Which is one reason the law has not gotten any more popular since it passed.

The merits no longer matter. It no longer matters if it ever did that only a few hundred thousand people previously without healthcare insurance now have it under the PPACA or that could have been accomplished at lower expense and disruption. It no longer matters whether the plan is actuarially sound or financially stable without increasingly large infusions of cash from the general fund. It no longer matters whether the plan is popular in its entirety or in detail.

That’s what I meant the other day when I wondered whether the PPACA had become a “vanity project”. Like a single-celled organism it now exists in order to exist.

{ 8 comments… read them below or add one }

TastyBits January 22, 2014 at 9:26 am

I think that you have tried to be fair, but I would like to see a Fox News Alert with something positive. I think that this thing is a big turd, but there must be at least one cubic zirconia in there.

Rather than give money directly to the insurance companies for losses, the medicaid limits can be increased, and the subsidies can be increased. People with existing conditions or extraordinary conditions could qualify for a subsidy.

PD Shaw January 22, 2014 at 9:40 am

I’m not as sure as McArdle that the audience would be that hostile, since I think a lot of people on the Left only truly support the ACA as a compromise, and like to claim it’s actually a Republican plan. If there is not a consensus on why the ACA is not working as planned, there may not be sufficient consensus to repeal it. As Abdul Alhazred wrote about Obamacare:

“That is not dead which can eternal lie,
And with strange aeons even death may die.”

Dave Schuler January 22, 2014 at 9:47 am

I can tell you why I think the PPACA isn’t working out as planned. The political considerations completely overwhelmed the pragmatic ones. They didn’t really care whether it would work or not. It’s built around slogans and gamesmanship rather than empirical outcomes.

... January 22, 2014 at 10:30 am

Let me try truncating her statement:

In a nutshell, you can’t increase demand but not increasing supply without causing serious problems.

That should do it.

michael reynolds January 22, 2014 at 2:54 pm

If you increase demand, supply increases. We’ll either get greater efficiencies or we’ll have prices that rise for a while then level off when supply and demand match up.

I know you’re all very anxious to be vindicated in your pessimism, but it’s not going to matter. This is politics. It is politically impossible to strip health care away from the poor who’ve been signed up under the Medicaid expansion, and not possible to strip 25 year-olds from their parent’s policies, and not possible to cancel out everyone with a pre-existing condition.

Once you realize that people are not going back to the pre-existing mess you’ll begin to realize that we’re going to have no choice but to evolve Obamacare so that it functions.

If it costs more it’ll cost more. Everything always does cost more.

Dave Schuler January 22, 2014 at 2:58 pm

If you increase demand, supply increases.

That’s simply not the case in healthcare. It’s regulated to prevent that from happening.

As evidence consider this chart. From it you can either conclude that the demand for healthcare has been flat in the U. S. for the last twenty years which is absurd on the face of it, that physicians trained are irrelevant to the supply of healthcare which is dubious, or that the supply of physicians does not increase as demand increases.

When you recognize that we’re actually educating fewer physicians per 100,000 residents than we did forty years ago it’s even more obvious.

Number of hospital beds
Number of RN graduates
MD enrollment per 100,000 population
Nurse practitioner and physician assistants graduating
Shortfall in primary care physicians (note increased projected shortfall as consequence of PPACA)

Andy January 22, 2014 at 7:24 pm

Michael,

This is politics. It is politically impossible to strip health care away from the poor who’ve been signed up under the Medicaid expansion, and not possible to strip 25 year-olds from their parent’s policies, and not possible to cancel out everyone with a pre-existing condition.

McArdle says basically the same thing in her column – that those parts of the ACA will endure, but most of it will die a slow, painful death. That seems to be where things are headed so far, but we’ll have to wait and see…. As for the politics, if things turn out as she predicts, those enduring portions make the pig look a bit better, but it’s still far short of grand promises proponents of the ACA trumpeted for years .

jan January 23, 2014 at 9:52 am

I can tell you why I think the PPACA isn’t working out as planned. The political considerations completely overwhelmed the pragmatic ones. They didn’t really care whether it would work or not. It’s built around slogans and gamesmanship rather than empirical outcomes.

That’s a concise summation of the PPACA. However, for those policies that are politically birthed, there are no abortion rights allowed. It must proceed as envisioned. Slogans and gamesmanship, no matter how stupid, will keep this kind of HC afloat. It’s a Titanic mentality of, “Damn the icebergs! Full speed ahead!”

It’s the same kind of ludicrous insight being applied here in CA, dealing with Brown’s fanatic infatuation with building a high-speed train, despite it’s inherent fiscal insanity and the growing opposition now wanting this project just ‘gone.’

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