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For about five years, I bought my health insurance through the individual insurance market. I had worked at the White House, HHS, and then the U.S. Senate, so I had spent years on the federal health plans deemed the gold standard of them all. But eventually I found myself uninsured, and working in a job that didn’t offer a health plan. I used eHealthInsurance to shop for a plan – high deductible with a Health Savings Account attached – and found several competitive premium rates. After I went through the application process, the plan cost only slightly more than the amount quoted on the website, despite the fact that I was honest about my penchant for cigars and a pre-existing injury. I was on it for several years, and when the premiums increased slightly, I shopped around and found an even cheaper plan with thinner benefits. The only thing having a HDHP really altered about my behavior in approximately five years was that I declined an ambulance and drove myself to the hospital when I needed surgery. At no point during this time would I have qualified for a significant subsidy under Obamacare, and had premiums increased significantly, I probably would have dropped coverage, having been uninsured before and not suffering any negative consequences.
Anecdote isn’t the singular of data. But it’s not an exaggeration to say the political success or failure of Obamacare’s model hinges on whether or not young and healthy people behave the same way as I did. The hedge against premium shock requires the Obama administration and their allies to convince young adults to sign up to ensure the risk pool has enough young and healthy people buying more insurance than they may need. And why is this a concern? Because most young adults don’t think they need a lot of insurance, and most aren’t willing to pay a significant amount for it … and because when you step back and consider what the law is doing to individual health insurance premiums in the broad sense, there’s no question that it’s going to make insurance coverage more expensive for those who are young and healthy.
Here’s where things get frustrating. Over the past week there’s been an increasingly angry back and forth among health care policy writers online regarding the lessons to take from the rate shifts in California under Obamacare, climaxing with this piece from Jonathan Cohn, who essentially accuses Avik Roy of being an irresponsible partisan hack. What is frustrating about these attacks on the validity of Roy’s argument is that they make real conversation about the effects of Obamacare difficult if not impossible. And it’s a conversation we ought to be having – and having fairly, if we take policy seriously – because this is a law that is already not living up to its promises… promises that most honest liberals concede ought to never have been made in the first place.
We all know the litany of promises by heart, because they were repeated so often and with such vigor: if you like your plan you can keep it. If you like your doctor you can keep them. If you already have health insurance, the only thing that will change for you is the amount of money you will spend on premiums, which will be less – $2500 less for the average family. President Obama made these promises again and again and again. And he made them about premium costs because that, according to most polling, was the issue people cared about the most. The vast majority of Americans liked their health care and their insurance plan: they just thought it was getting too expensive. Obamacare was supposed to solve this problem. It hasn’t, and it won’t… but now the law’s supporters are arguing that was never the point.
The true moral case for Obamacare was about universal coverage; but instead, it was sold to the American people as a solution for higher premiums. The conversation shifted from “everyone’s premiums will be lower” to “well, you can’t expect lower premiums when you’re getting better coverage – whether you wanted or needed it or not.” As the WSJ editorializes today: “The Affordable Care Act was sold as a tool to lower health costs. In case you missed it, the claim is right there in the law’s title. The new Democratic position is that the entitlement will do the opposite but never mind, which is at least more honest. But we wonder how long this new candor will last. If the public reacts badly to these higher premiums, the authors of ObamaCare will soon be back to blaming insurance companies and Republicans.”
Except I’m not sure this candor is lasting at all. Consider the reaction from Steve Benen, a longtime liberal blogger who now works for Rachel Maddow, who attacks Roy with a callback to the “reality based” epithets of the Bush years: “I believe this is yet another data point that highlights the wonk gap… Credible policy debates are rendered impossible, not because of the chasm between the two sides, but because only one side places a value on facts, evidence, and reason.” For the sake of comparison, their bio pages inform me that Roy studied molecular biology at MIT and then the Yale University School of Medicine, while Benen was a communications director for an unsuccessful Democratic congressional campaign in Pennsylvania, but your miles may vary when it comes to how much they value facts, evidence, and reason.
All Obamacare has to do to survive any and all policy assaults is work the way it was promised. If it does, the American people will respond, and the poll numbers will shift. In the meantime, it does the left no good to write off serious people like Roy or to pretend that these premium increases broadly are not a problem, or that the American people simply misunderstood what they were promised in the process of passing the legislation. Or Congress, for that matter – see Table 1. There are going to be ramifications for this broken promise, and there will be proposed policy solutions in future Congresses and under future presidents. Obamacare is not the last health policy reform, and its failure to match up with how it was sold will impact whatever comes next.
[First posted at Real Clear Politics]