The liberal spin on Obamacare is spinning out of control

2013

It really is getting harder and harder to figure out if politically motivated statements are naive rhetoric, intentionally misleading or just plain dumb.

Take a look at this from the Center for American Progress, a liberal organization in the Obama camp.

The Affordable Care Act is already working: Intense price competition among health plans in the marketplaces for individuals has lowered premiums below projected levels. As a result of these lower premiums, the federal government will save about $190 billion over the next 10 years, according to our estimates.

These savings will boost the health law’s amount of deficit reduction by 174 percent and represent about 40 percent of the health care savings proposed by the National Commission on Fiscal Responsibility and Reform—commonly known as the Simpson-Bowles commission—in 2010.

Moreover, we estimate that lower premiums will lower the number of uninsured even further, by an additional 700,000 people, even as the number of individuals who receive tax credits will decline because insurance is more affordable

Already working? Intense competition? Save $190 billion over ten years?

About that already working stuff. Insurers are setting rates in the first year of an untested program in order to attract the better risks while under intense pressure from regulators to hold down premiums. In addition, the rates currently reflect greatly limited networks of participating providers and plans with substantial out-of-pocket costs which must be factored into the much overused “affordable.”

In any case, nobody will know if the premiums are adequate until sometime in 2015. That also means any projection of long-term savings based on current premiums is absurd. The federal government will save? At best, the federal government will spend less of more than projected and that’s assuming Congress doesn’t touch the law for the next decade … good luck with that.

Intense competition? Hmmm, The Obama administration said most people will have a choice of at least two carriers, but a few people will have just one choice. In any case, competition of any kind has limited impact on premiums. Search “competition” on this blog for more discussion.

Claims of success (or failure) for Obamacare in 2013 are meaningless. We seem to forget that if something doesn’t meet a projection, it may mean the projection was wrong not that success or failure has been achieved. In any case, the real cost of health care is … the health care provided which eventually is reflected in the premiums needed to cover the actual costs, unrelated to “intense competition.”

Consider the following from an October 24 New York Times article:

Of the roughly 2,500 counties served by the federal exchanges, more than half, or 58 percent, have plans offered by just one or two insurance carriers, according to an analysis by The Times of county-level data provided by the Department of Health and Human Services. In about 530 counties, only a single insurer is participating.

“No one knew who was going to file,” said Barbara Morales Burke, an executive with BlueCross BlueShield of North Carolina, the only insurer offering coverage in 61 of the state’s 100 counties. “We developed the rates we always do based on actuarial information and reasonable estimates.”

Obamacare supporters who keep harping on this competition nonsense will rue the day. When the law was being crafted the White House health care advisor pointed out that more insurers in a given market is counterproductive because it lessens their leverage negotiating fees. The non-profit, consumer run co-ops required and funded under the law and designed to increase competition are already in financial trouble and in cases where I was able to check, had premiums equal to or higher than regular insurers.

And then there is this, in many areas of the country there were competing health insurers long before Obamacare, insurers who had their premiums approved by regulators and still costs could not be controlled.

All this spin is merely an extension of the original White House tact of using insurance companies as the scapegoat to push the law. After all, everyone hates their insurance company. The competition we need is within the health care system based on quality and price. But that too is illusive.

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