• Quote: David Cutler on ACA implementation

    My general view is that the early implementation efforts are far short of what it will take to implement reform successfully. For health reform to be successful, the relevant people need a vision about health system transformation and the managerial ability to carry out that vision. The President has sketched out such a vision. However, I do not believe the relevant members of the Administration understand the President’s vision or have the capability to carry it out. Let me illustrate the problem you face and offer some solutions.

    David Cutler,  May 11, 2010 memo to Larry Summers

    See also, this Washington Post story by Amy Goldstein and Juliet Eilperin. I agree with Tyler Cowen that both are essential reading.


    • What, exactly, is the exchange supposed to do? It’s often described as an on-line insurance marketplace, but it most definitely is not. It provides no details about the health plans listed. It simply lists available plans and prices (which I understand are merely estimates not actual prices). So what is the exchange supposed to do? It appears that it was designed to perform one function: to determine the subsidy available to the consumer. To call it a marketplace is misleading. I suspect that the current criticism will be nothing compared to the criticism to come once it becomes apparent that the exchange does not fulfill the promise of an on-line insurance marketplace. Indeed, that the exchange can’t perform the one function it was designed to perform, determining the subsidy available to the consumer, makes one wonder what these folks were thinking.

    • To be clear, I’m no computer nerd (maybe I’m a nerd, but definitely not a computer nerd), so I’m not piling on here. My observation, which I’ve made many times, is that Obama’s number one priority for health care reform is and has always been (near) universal insurance. Hence, It’s not surprising that the exchange’s main function is to determine qualification for and the amount of the subsidy. My priorities are different. They are not better priorities, just different priorities. I would have preferred that the exchange actually be an on-line marketplace for insurance (disclosure: I’m in the individual policy market). And I would have preferred federal (uniform) standards for insurance so I’m confident when I select a particular plan somebody has made an independent determination that the benefits match what most people need. My fear is that the exchange, even once the “technical glitches” are fixed, will be a big disappointment. I also fear that the exchange, by providing so little useful information about the plans listed, will induce a kind of consumer paralysis, defeating the one function for which it was created.

    • Robert,

      It is supposed to do all of those things. It is supposed to identify you, check your income against IRS records, check your eligiblity for a subsidy (or Medicaid) based upon health insurance status and income levels, allow you to see the subsidized price of multiple policies, as well as the details of those plans, which doctors and hospitals are in the network, coinsurance, deductible, and co-pay structure, and covered services.

      I work with Kentucky’s exchange. All of that information is available through ours. I have tested it for myself and certain family members and it APPEARS to work as advertised. My sister wanted certain dentists and physicians and I was able to help her select policies which met those criteria.

      I am not sure what capacity the federal site is close to having, but it is supposed to do all those things by law. We were required to prove functionality in all of those areas and undergo 3 months of testing prior to the go-live date. The Feds exempted their own website since they were catastrophically behind schedule, and even required states to dismantle some functionality in the last week. We were set to be able to receive payments via the website and forward it to the insurer…the Feds knew they couldn’t hit this target and ordered that we disable that functionality 10 days prior to go-live).