Sometimes readers get confused by the title of a post (or newspaper article, book, etc.). How accurate and complete can a brief statement be? Not very. Sometimes one has to read the content of the piece and apply a little thinking to assess the title’s scope. We know this, right?
Case in point: I titled a prior post “Individual Mandate Penalties Are Adequate.” Adequate for what? And in what sense? Adequate to rid the world of disease and famine? Adequate to confuse or annoy people? Of course the body of the post is crystal clear of the scope of adequacy, the means by which the assessment was made, and the limitations of analysis applied. As Reihan Salam quoted my conclusion,
Since there is little evidence of substantial gaming in Massachusetts, based on an analysis of penalty size alone there would seem to be little cause for concern over gaming under ACA, particularly for higher income individuals. This analysis ignores other differences between Massachusetts and its health reform law and the national population and ACA, respectively. Results are sensitive to assumptions, but I deliberately selected those conservatively as indicated above.
Salam also correctly points out that Massachusetts permits insurers to apply a six month pre-existing condition exclusion period. That is, they must guarantee issue of a policy but do not have to cover a pre-existing condition in the first six months. As far as I know, no such exclusion period is permitted under ACA rules. So, this is a difference between the Massachusetts individual mandate and the ACA’s mandate. I pointed out this difference in a prior post to which I linked in the “Individual Mandate Penalties Are Adequate” post.
For all that, Salam concludes, “Frakt titles his post, ‘Individual Mandate Penalties Are Adequate.’ I’m struck by his confidence, and impressed by it.” I’m delighted to be viewed as impressively confident, but what’s so impressive really? Does Salam think I meant that the penalties are adequate to overcome all the other differences of relevance between the Massachusetts and ACA laws? That would be an impressive assertion. Impressively dumb. If I meant that would I have pointed out that other important differences may exist and linked to a post that described one (the exclusion period)? No. Nor would I have written the conclusion Salam quoted, emphasizing that my analysis was based on “penalty size alone.” And I wouldn’t have started the piece with “Some have asserted that the individual mandate penalties under the Affordable Care Act (ACA) are lower than those imposed in Massachusetts.”
Thus, it should be clear to that I was documenting that there is no basis for an argument that the ACA penalties are lower than Massachusetts’ penalties. That’s not how one goes about supporting a claim that there will be gaming under ACA. Yet that’s the argument Salam had made in an earlier post in which he wrote, “My reading is that the penalties are considerably more onerous in Massachusetts than under the new federal legislation.” Since that is false, one has to base the argument on something else. That is, ACA penalties are adequate as far as penalties go, but other provisions of ACA may not be sufficient to prevent gaming.
I’m not saying there is no cause for concern about gaming. On that Salam and I may agree. I’m saying that penalty size differences aren’t the place to look for support of such a concern. Clear?