• President Obama “lied” about the individual mandate, too

    I’ve been traveling to give a talk yesterday and today, which means that I’m missing the hearings today. I couldn’t care less. If anyone thinks anything of value, policy-wise, is going to come out of that then I’ve got a bridge to sell you.

    What people hope for is a gaffe. They hope a politician they don’t like will say something stupid, or make a mistake that they can use to attack a policy from the sides. Gaffes can be fun, but only in the realm of politics. Gaffes can be useful when they allow us to highlight problems with policy.

    Such was the case with Senator Cruz’s spokesperson and the “subsidies” given to employer based health insurance. We can use the statement to highlight a policy issue that needs fixing. But we are interested in the policy – and will continue to write about that – not the gaffe. That will fade away quickly.

    On the other hand, I don’t care how many times you email me or tweet me to say that President Obama “lied” when he said you could keep your plan if you like it. I immediately recognized that was untrue when he said it. I called him out on that. I did that because I thought it was important to highlight the policy of the ACA and explain that there were many mini-med plans and the like that were going away no matter how much people liked them. And then I moved on. Austin recently wrote on how it was indefensible again.

    This “mistake” is on the administration, not the policy. It’s how the ACA was supposed to function, and it’s unfortunate that the President got it wrong. But that’s on the people who said it, not the ACA. If there are any members of Congress who voted for the law because they believed that to be true, then they have a gripe. If there are any voters who voted for the President because they believed that to be true, then they have a gripe. Everyone else wouldn’t have changed their behavior much. Could they hate (or love) the law more?

    Moreover, these are politicians. Everyone has short-term memory problems, or else they would remember that Senator Obama made huge gains against Senator Clinton for attacking her for having an individual mandate in her health care plan. Then he flip-flopped in office and made a law with one. People make mistakes. Will the next major breaking news story be that President Obama lied about the individual mandate?

    When I spoke last night, I was confronted by people who immediately assumed I loved the law and would defend it to the death. Others assumed that any criticism I made meant that I wanted to repeal it and put us back to the status quo ante. We have to get past this. We will be much better off as a country if we work to fix our health care system and if we work together to make it function more optimally than if we continue to try and win this “game”.

    @aaronecarroll

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    • So it was only a lie if you believed it?

    • Among the people I know who’re griping about their plans being cancelled about half are annoyed because the darn web site isn’t letting them buy another and they’d rather not be uninsured.
      The other half are unhappy because the new plans they may or may-not be able to sign-up for are more expensive.

      If I were the President I’d be pressing to get that web site working and stall on the misleading statement about being able to keep your insurance.

    • ” there were many mini-med plans and the like that were going away no matter how much people liked them. ”

      Isn’t that the crux of the matter about “if you like your coverage you can keep it”?

      There were people who liked their policies and did not want government “help” in choosing plans. Relieving their concerns that the intervention of the federal government would take away their coverage became a major political goal. The claim that people could keep their plans was central to the argument. So central that the WH is still maintaining this fiction.

      The truth is that the ACA was going to take away policies “no matter how much people liked them ” is exactly the problem with the federal takeover. The designers of the ACA deeply and sincerely did not CARE whether people liked their plans. They cared no more about this than they did about people who will see their premiums go up, people who will be priced out of the market, people who are too POOR to get subsidies, or people whose hours will be cut to get under the 30 hour limit. Before their intervention, insurance companies could create policies that they could sell to individuals, who presumably thought the policies were worth the price. After government intervention, the companies are not permitted to do this, and individuals who wanted those policies are out of luck.

      “no matter how much people liked them ” sums it up very well.

      • You are trolling and completely oblivious to the point. If you’d been keeping up, you’d realize those plans went away because they did NOT provide an aqequate minimum level of service. People “liked” them because they were cheap, not because they actually did much. Its not about government meddling or a desire to dictate to the people. no more than the FDA’s guildelines for minimum food safety.

        • “You are trolling and completely oblivious to the point.”

          Thank you.. That is a cogent rebuttal of my point. You, sir, are a gentleman and a scholar.

          “those plans went away because they did NOT provide an aqequate minimum level of service. ”

          In your opinion. The opinion of people who were buying the plans is, of course, irrelevant. If one were so sure that the new policies are better than the old, then one could simply leave the old policies in place. Since the new ones are so much better, no one would buy the old ones. But of course, that would mean letting individuals decide for themselves which policies to buy. Can’t have that.

          “People “liked” them because they were cheap, not because they actually did much.”

          And again, individuals should not be permitted to decide for themselves what mix of coverage to buy, at what price. The government will design the policy for them, and they will have to pay whatever the policies cost.

          Did I mention that I love your hair?

        • That’s correct.

          People have become accustomed to spending a relatively high amount of money for a relatively crappy product.

          They are complaining now because they still want that?

          I simply don’t have a single memory of anybody who was covered by one of those crappy policies singing its high praises when it actually came to being needed.

          Not.a.single.memory.

        • Yes, because some policies, like mini-meds were basically scams. Until someone got sick and wanted to use their policy, they might not realize it was a scam and be happy with it and the price.

    • I’ve been enjoying the “coverage” of the ACA here at the Incidental Economist because it has, I think, done what you suggest such coverage (and by extension, those of interested in health care delivery and financing) should be doing. It is honest about the problems, honest about the pros and cons, and doesn’t mistake policy issues for personal ones.

      I thought, and still think, that the ACA is a useful (and potentially very important) step forward for the country. It isn’t perfect. First, because there is no “perfect” way to deliver and pay for health care. But more importantly, because it was a cludged together compromise. Does that mean it wasn’t better than the alternative available (the old status quo)? No — I happen to think we have good reasons to think it was better, potentially, again, importantly so. But that doesn’t mean it is perfect, or even great.

      It is particularly frustrating that those who hate the law have simply, as far as I can tell, given up on (or never really believed in) the goal of our society providing a decent level of access to health care for all its citizens. There used to be at least the pretense that this was everyone’s goal, and the question was simply about the best (most fair, most just, most efficient, etc.) way to do this. But it looks like that’s not true anymore. (The ACA was never going to be able to achieve that goal, but before the Medicaid expansion was gutted, it would have been a big step in the right direction.)

      So, yes, there are a lot of easily fixed problems with the ACA as written and interpreted. If one side wasn’t just hell-bent on repealing the whole thing and going back to the way things were (and maybe repealing EMTALA too while we are it) we could easily fix these problems. But we won’t, for a while at least, because fixing these problems would be admitting that the ACA might just be sticking around for a while.

      So no, I won’t defend the arbitrary nature of the employer penalty’s particular cut-offs, nor the way that they are calculated (how hard would it be to switch to a penalty based on total FTE, calculated by total paid hours? And thereby get rid of any incentive to reduce hours or hold full-time employee numbers down? Not hard.). No, the rule regarding unaffordable family coverage offered through one’s employer and subsidies on the exchanges, isn’t a good interpretation of the law, and the law should be changed to make clear what was intended but subsequently misinterpreted. None of this is impossible or even hard. And yes, the interaction between policies being cut as non-ACA compliant, and the fact that the exchanges aren’t working well (or, in some cases, at all) for people is a serious problem — it creates stress and anxiety unnecessarily, and could have been avoided.

      But I think as a rule, those people who oppose the law in its entirety shouldn’t be taken seriously when they complain about easily fixable aspects of it, unless they are willing to actually support *fixing* those problems they point towards.

    • I was going to post about why it’s likely a good idea that these types of plans are being cancelled, but some responders to an Andrew Sullivan blog post put it better than I could:

      http://dish.andrewsullivan.com/2013/10/30/dissents-of-the-day-49/

    • “It is particularly frustrating that those who hate the law have simply, as far as I can tell, given up on (or never really believed in) the goal of our society providing a decent level of access to health care for all its citizens.”

      Well, I am not sure it is frustrating, except to the extent that the existence of different political opinions is frustrating when I want all policy makers to agree with me. Many people never signed on to the idea that the federal government should have a larger role in determining the content of policies, saying who had to buy insurance, who would get subsidies, where people could go to purchase coverage, or the many other areas into which the ACA has introduced federal control.

      There are conservatives who objected to this as an extension of federal power. Whether or not they agreed that SOCIETY should provide health insurance for everyone- and many did not agree with this- they were clear that, in their opinion, the federal government should not do this. Many, many of them were quite clear on this, and never pretended that they felt otherwise.

      Remember, our current situation where we have a law requiring you to have insurance, your current policy is cancelled as non compliant, and you cannot sign up for a new policy is a feature that can be brought to you ONLY by the federal government. Left to their own devices, private companies would offer less generous policies at lower prices, and endeavor to sign people up, if they could make a profit. They would not create a nationwide standard for minimum coverage, cancel policies that do not conform, and point people to a nonfunctional system to replace them. This is an example of exactly why some people were so hesitant about the prospect of a federal takeover. I do not find caution about building more massive bureaucracies to be frustrating at all. Just common sense.

      • “Left to their own devices, private companies would offer less generous policies at lower prices, and endeavor to sign people up, if they could make a profit. ” Wow. The fact that this is presented as a clear argument against the ACA is just… jaw-dropping. It’s a statement that the healthcare system SHOULD be driven by the market, even if it fails to achieve societal goals. If people die, well, them’s the breaks! This is precisely why people argue that healthcare should not be a for-profit industry. Clearly, there are always going to be sectors of the healthcare market that are unprofitable — old people, sick people, disabled people. The fact that the private market is so clearly abandoning these individuals is the main reason why something like the ACA is so urgently needed.

    • I’m a non-believer in insurance in general and in the train-wreck of Obamacare in particular. Your appeal to me to cooperate with others to “fix it” is ridiculous.

      Martin Luther tried to fix the Roman Catholic church when he should have moved to scrap it, and look what we ended up with: Protestantism.

      • “I’m a non-believer in insurance in general and in the train-wreck of Obamacare in particular. Your appeal to me to cooperate with others to “fix it” is ridiculous.”

        I will note first that I claimed only that those people who, like you, object to the entirely of the ACA, and reject the goal of providing reasonable access to a reasonable level of health care for most of our citizens, should not be taken seriously when they point towards easily fixable problems with the ACA as grounds for scrapping it (rather than fixing it). I’m not asking that those who oppose the whole idea help fix it; I’m asking that those who oppose the whole idea stop going on about easily fixable problems as if that was where their objections were.

        Opponents who are honest that they simply don’t think it a legitimate or valuable function of government in the contemporary world to provide reasonable access to health care for their citizens do not quibble about the number of hours that should count as “full-time” or similar trivialities. They should not care about the details of the plan at all. But when they point out some easily fixable flaw, it is fair to say “OK, we can fix that.”

        I will add that I find the implications of rejecting the view that we have, as a society, a responsibility to provide reasonable access to a reasonable level of healthcare for our citizens to be appalling, and find the claim that a civilized society has no such duty to be morally repugnant. It is, nevertheless, a claim that many people do in fact hold; if they argue that claim honestly, it is an argument that we, as a society, have to take seriously. I hope it is an argument that those of us who believe society does have an obligation to provide reasonable access to reasonable healthcare will win, but there are of course no guarantees.

        There are of course any number of ways that we could, as a society, attempt to guarantee a reasonable level of access to reasonable health care for all our citizens. The ACA was one attempt, and how successful it will, in the end, turn out to be is still rather up in the air (it would of course have had a better chance of achieving that end had the Medicaid expansion not been gutted).

        Rejecting that ideal — arguing that we shouldn’t, as a society, try to provide a reasonable level of access to reasonable health care — is a position I am adamantly against, but I would rather those who hold it argue it honestly, rather than pretending that they want the same thing (near-universal reasonable access to reasonable care), but simply think that e.g. a completely unregulated free market in health care is the way to get it.

    • Unfortunately, fact-checking can be rather subjective sometimes. I think it is important to keep Obama’s remark in context: he was refuting critics who claimed that the ACA was a total government takeover of healthcare that explicitly terminated all private-sector plans. This really was what conservative critics were claiming, so much so that Politifact made it “lie of the year:” http://www.politifact.com/truth-o-meter/article/2010/dec/16/lie-year-government-takeover-health-care/ In that context, it makes sense that Obama wanted to reassure people that the ACA would not actually take away their private insurance.

      It is worth remembering that the pre-ACA individual market involved only 5% of the market, and none of those insurance plans are actually made illegal by the ACA. While it is true that some of those pre-ACA plans will be voluntarily terminated by private insurers (and, let’s be honest, enrollees who now have better options), it isn’t totally true that all of them will be: most of the plans offered for me on the Ohio exchange are actually close variants–with the same names–of plans previously offered in the old individual market. These plans have been modified to become ACA compliant, and whether you consider that “modification” or “termination” of your existing insurance is pretty subjective.

      So, I would rate Obama’s claim as more than 95% correct, but also a huge oversimplification.

      • Matthew, I think you hot the nail on the head. Has a politician who makes a claim that is true for more than 95% of people told a lie? There may be millions of people who hold policies that are canceled by insurers because they don’t meet the minimum ACA requirements. That’s a lot of people, but they represent only a small fraction of those with insurance.

        This is not to condone Obama’s statement. Although it has been taken out of context, it was never really the case that everybody could keep their insurance if they liked it, as Aaron points out in his original comments.

        Still, if we’re holding politicians – or anyone else for that matter, but especially politicians – to a standard that requires every statement to be 100% true 100% of the time or be labeled a “lie,” we’re going to have a lot of liars on our hands.

    • The system selects for lairs and con men because the voters are rationally ignorant.

    • PPACA is NOT “a good start”. Under PPACA, without change, expect to see the percentage of non-elderly Americans with employer sponsored, “minimum value” coverage drop from a reported high of about 69% to < 40% in ten years. And, expect PPACA to trigger a massive expansion in individuals enrolled in "minimum essential coverage" (preventive-only plans) where the coverage is even less valuable than today's mini-med plans.

      And, sorry, mini-med's, those plans that have modest deductibles, coinsurance and a maximum annual dollar benefit payment, ARE the only private/public solution that is likely to address the real issues. Properly structured and complemented, they ARE the solution. However, after trying to suggest this bipartisan alternative in 2008 – 2009 in various forums, I know better than to suggest Americans are ready and willing to consider adjustments/changes to PPACA today.

      Such an offer would be a waste of time. You saw this in the budget/debt showdown – with no willingness to make even minor changes.

      Simply, even after PPACA, we are still left with the same issues and problems we had before – perhaps expanded to match the new, outlandish expectations politicians created by asserting Americans now have a right to health care – and that this right should be financed by "someone else".

      The issues remain:
      – Health care treatment is expensive,
      – Good health is perhaps the most valuable asset anyone can have, generating inelastic demand for medical services,
      – There are inter-generational tensions because health costs increase significantly with age, and
      – People want the best coverage YOUR money will buy … that is, when confronted with the real cost of health coverage, most are unwilling to spend to provide for their potential needs/risk exposures; and people will "self-ration" based on their financial/personal priorities. As someone once famously said about taking risks "I want to roll the dice a little bit more", here, when it comes to being underinsured. If it comes up craps, well, that's YOUR financial burden.

      Simply, with health services at 17+% of GDP, no solution works until we are all willing to shoulder some of the burden individually given what we are already doing as a society.

      There always was a reasonable public/private health policy solution. However, the health reform debates of 2008 – 2009 remind me of a famous Winston Churchill statement – "You can always count on Americans to do the right thing – after they've tried everything else." PPACA certainly fits the definition of "everything else".

      The reasonable public/private, bipartisan middle ground, has to start with confirming to Americans the above issues – that solutions are not easy nor inexpensive, and that each and every one must be personally accountable – as we are expected to be as consumers of dwellings, food, cars, etc.

      I'm not talking about exposing people to the risk of a major loss – simply, few employers, let alone individuals, can shoulder the true cost of health services where there is a major, life threatening event. But yes, I am talking about universal coverage with individual accountability, where that accountability is cumulative, and not discharged on an annual basis. That is, where the individual relies on society (the taxpayers) to provide funding for a basic level of coverage, the cost becomes an individual debt to be repaid at a future date.

      Jack Reid, John Kerry, Ted Kennedy, Bill Frist, and Phil Bredesen all had part of the solution, which, once integrated, creates the best bipartisan, public/private option available:
      (1) Provide stop loss coverage that is privately managed by the Medicare intermediaries with set profit margins (a la Medicare), and which is publicly financed (with employer and taxpayer contributions) to all Americans:
      – Employer's pay the stop loss fee to cap their benefit plan exposure, which in turn, requires them to provide HSA-HDHP qualifying coverage below the stop loss attachment point), and
      – Individuals pay the fee where they are not covered under an employer sponsored plan – it becomes a new, per capita tax.
      – Once the individual reaches the stop loss attachment point (e.g., $25,000 / $50,000 of covered expense per individual), future expenses that year shift to Medicare and the intermediary applies Medicare reimbursement rates. The point of purchase cost sharing for stop loss coverage is designed solely to prevent over utilization, not to share expenses with the participant/patient.
      (2) Default all Americans into coverage set at the HSA-HDHP qualifying level – which is where Massachusetts Creditable Coverage minimum is set today, and which fits a "Minimum Value" scenario under PPACA. Incorporate preventive services with no cost sharing – as many HSA-qualifying HDHPs do today. Insurance defaults (vendor, covered services) are established by each state as part of a competitive bidding process.

      Where an individual has employer-sponsored coverage in effect (minimum set at the same point, the HSA-HDHP minimums), the default would be waived and no premium would be assessed (employers would report the coverage on Form W-2 and a certificate of creditable coverage, a la HIPAA).

      Employers are incented to offer coverage below the stop loss with the same tax preferences available today – and because they are paying a tax on every individual to fund the stop loss. Employer-sponsored coverage would become much more affordable once the risk of catastrophic loss is socialized; and therefore, employer-sponsored coverage would be much more prevalent than it is today – reversing the trend of fewer and fewer non-elderly Americans with employer-sponsored coverage (employees, spouse AND children). Mandates to cover employees, spouses and/or children would be eliminated. This would create a situation where employers would truly differentiate themselves with the offer of tax-preferenced coverage.

      The exchange would remain. Individuals could select exchange coverage if they did not want the default. Where they do not have employer-sponsored coverage, offer taxpayer subsidies to cover premium payments as needed (to be set at an arbitrary income threshold below which people will qualify), but, notationally record the subsidies provided and recover those from future earnings that exceed a particular dollar threshold (again, set arbitrarily, probably at the federal poverty level). The coverage starts at birth and ends at death. It is individual, per person. The premiums are paid throughout the year to the insurers by the federal government; and the taxpayer funding is captured once a year when filing tax returns. Individual coverage would receive the same tax preferences as employer-sponsored coverage – becoming not an itemized expense, but an above the line dollar for dollar offset of income, which would trigger a "refund" of FICA and FICA-Med taxes.

      For the employed, appropriate adjustments will be made via a tax withholding default, reset annually. Tax withholding rates would be established.

      Interest on the "loan" from the taxpayers is charged at the appropriate rate the nation paid to secure/borrow the money.

      Individuals who cannot pay their tax debts are set up on a payment plan through either ACH or increased withholding, or both. Debts are NEVER forgiven, interest continues to accumulate, the debt just won't be collected/assessed unless and until there is income above an arbitrary poverty threshold; or as a tax at death. .

      In Tennessee, a version of this was called CoverTN.

      This alternative has something for everyone – a safety net for D's and personal accountability (within limits) for R's. It leverages existing systems and processes.

      What's the goal, here? If it is "universal coverage", clearly PPACA won't trigger universal solution, and will clearly lead to fewer non-elderly Americans with private , "minimum value" coverage than have such coverage today.

    • You don’t need to invoke rational ignorance. The voters who like Obama and the ACA do not care about the lies in support of favored policies.

      Pandora,

      Acknowledging the problems with the private does not mean that ANY federal imposition is an improvement. The ACA has scrambled the board, leaving some people better off and some worse. If one declares as a religious conviction that government solutions are always better, one can declare that net societal welfare must have increased, because the government acted. Another popular approach is to claim that those who are worse off deserved to be punished by government intervention. Those who are better off were worthy and deserving. And there will be those poor fools who thought they were better off before they got government help. Their belief in their ability to make decisions without federal control is simply proof of how misguided they are.

      • “The voters who like Obama and the ACA do not care about the lies in support of favored policies.”

        I’m really tired of this type of nonsense. If you have an evidence-based argument to make, then make it. Accusations and generalizations like this one have no place on a rational blog, are insulting, and diminish any cogent points you may have.

        Anyway, in my experience, supporters of the ACA are much more willing to acknowledge faults in the law than opponents are to acknowledge any good features. It seems to be black-and-white for only one side.

        In the end, we have a process for making law in this nation. One side chose not to participate in that process and to offer no alternatives. If you don’t like the level of government involvement in the ACA (or in the health system in general), then use the process to change it. Offer alternatives. Participate. I don’t see a lot of that happening.

    • “Accusations and generalizations like this one have no place on a rational blog, are insulting, and diminish any cogent points you may have.”

      The thing about insulting people on the internet… it just does not work. You don’t like what I said. Fine. But rather than responding you toss out insults. Do you really think this persuades anyone? What about your comment would be convincing? It just says “there is a person on the internet who disagrees”

      One need read no farther than this blog to find people who are quite happy with the fact that Obama lied. I think you will find the statement to the effect “If he lied, so what?”

      Politicians are liars
      Obama is a politician
      You fill in the rest

      ” If you don’t like the level of government involvement in the ACA (or in the health system in general), then use the process to change it. Offer alternatives.”

      Have you forgotten the shutdown? You must have hear about it. It was in all the papers… That was part of the process. Appropriations require House approval. Check out the Constitution.

      The next few weeks will see yet another attempt to find a budget agreement. The ACA will not be at the top of the agenda, but it will be there.

      Did you notice the argument over funding the rollout of the federal exchanges? Took place in Congress. Part of the process. May have been in part responsible for the mess the rollout became. That was part of the Republican goal, and part of the process.

      “Offer alternatives.”

      How about 40+ votes to repeal? Part of the process, and certainly an alternative.

      You may think the ACA is a great law, not perfect but great. You may think that people who want to dump it entirely are misguided fools. But simply declaring that does not constitute an argument.

      It is true that one approach the hard right might take would be to try to change it. But their objections are with the expansion of federal power. These are so fundamental that it is hard to see where they could meet the left in the middle.

      If you remove the expanded federal power from the ACA there is not much left. No individual mandate, no employer mandate, no coercion to the states to expand Medicaid, no mandates for what policies must cover, no prohibition of medical underwriting.

      It is a very long law that apparently few people have actually read. There is a lot of other stuff in it. But take out those provisions and it looks nothing like what Obama was so proud to have passed. So, from the point of view of a Tea Partier, there are no changes in the ACA that would both make it acceptable to the right and would be remotely considered by Democrats.

      Single payer would have made a lot more sense. It would be an inefficient bureaucratic government nightmare for a while. It would close a number of marginal hospitals, it would put a number of medical practices out of business, and chase off the best and the brightest from entering medicine. (That is probably a good thing. Too many smart people go into medicine as it is) It would cost a fortune. The country would recover from the worst growing pains after a while. Ultimately it would have everyone covered, which is more important than the pain of getting there.