Obamacare Review

Time to check in again on Obamacare.  We all know that this grand piece of social engineering is supposedly the cure for the "crisis of the uninsured."  The provisions have mostly fully taken effect as of the beginning of this year, most particularly the so-called "individual mandate."  That'll teach those recalcitrants who won't buy what the government wants them to buy!    So I guess pretty much everyone now is insured, right?  Well, let's see if we can find the answer to that question.

There turn out to be multiple sources giving not-completely-consistent information.  For background, according to figures from the Census Bureau here,  in 2000 at the end of the Clinton administration the rate of uninsured in the United States was 13.7% and the number of uninsured was 38.4 million; and at the end of the Bush administration in 2008 the rate of uninsured was 15.4% and the number of uninsured was 46.3 million.  The latest information from multiple sources is as follows:

  • The Census Bureau has just issued a report this month (September) titled "Health Insurance Coverage in the United States: 2013."  That's right, it only goes up to the end of last year.   According to a "Highlights" section on page 2, the rate of uninsured in 2013 was 13.4% and the number of uninsured was 42.0 million.  Does that represent some progress that can be attributed to Obamacare?  Oh wait, they changed their methodology from previous surveys, and now the question asks only whether you lacked health insurance for the entire year, as opposed to the old methodology, where the question was whether you lacked health insurance for any part of the year.  Why do I have the strong sense that that change is an intentional scam to drive down the number in the "uninsured" category to make Obamacare look good?  And yet that number has still only gone down marginally, at least by the end of 2013.   And how much of the change would have happened anyway in a (slowly) improving economy?
  • Gallup has been doing surveys on a quarterly basis.  As I noted in a previous post, because the Census data is so untimely and of inconsistent methodology, HHS itself has been relying on numbers from Gallup.  In July Gallup released the results of a poll covering 2Q 2014, and reported that the rate of uninsured was 13.4%, constituting just over 42 million people, representing a decline from a 17.1% rate at the end of 2013.
  • Transamerica Center for Health Studies has come out in September with a report titled "One Year In: Americans Respond to the Affordable Care Act."   This report gives the percent uninsured as of July 2014 as 15%, which would be about 47.2 million people.  To be fair, their methodology showed the percent uninsured at the end of 2013 as 22%, while Gallup had 17.1% and Census had only 13.4%.  But they don't tell you enough about the methodology to reconcile the discrepancies.  They do attribute almost all of the decline in uninsured to a rise of five percentage points in "public insured," i.e. Medicaid.

Forgive me, but I am completely underwhelmed by these numbers.  Back in the Bush administration, I listened to a constant drumbeat of activists asserting that the numbers of uninsured in the United States represented a desperate crisis.  Among hundreds of examples, who can forget the Institute of Medicine report from 2009, in the run-up to the passage of Obamacare, titled "America's Uninsured Crisis: Consequences for Health and Health Care"?  That report from the supposedly neutral IOM contained the following over-the-top rhetoric:

The growing number of uninsured Americans--totaling 45.7 million as of 2007--is taking a toll on the nation's health. One in five adults under age 65 and nearly one in ten children are uninsured. Uninsured individuals experience much more risk to their health than insured individuals. In its 2009 report America's Uninsured Crisis: Consequences for Health and Health Care, the Institute of Medicine points to a chasm between the health care needs of people without health insurance and access to effective health care services. This gap results in needless illness, suffering, and even death.

"Needless illness, suffering, and even death."  We must pass a law mandating that everyone is required to buy health insurance!!!  Well, we passed the law, and if you believe the Transamerica numbers, the number without health insurance today is about 47.2 million, which is up from the 45.7 million cited in the IOM study for 2007.   For this the government took over one-sixth of the economy?  For this we concede to the government the right to tell us what treatments we can and can't have?  For this we accept new layers of complexity in our taxes.  For this, we give the government access to all of our health records?

Oh, and then there's the cost.   For that we turn to Lahnee Chen of Bloomberg News on September 26, summarizing a report from Bloomberg Government on September 24.

The study found that federal spending on Obamacare and related legislation has far exceeded anyone’s estimates (or imaginations). To date, the report concludes that the health-care law has cost taxpayers $73 billion. And that number doesn’t include projected spending on the law’s Medicaid expansion, which if included would bring costs to more than $90 billion. The study’s estimate is even higher than the Congressional Budget Office’s “high” cost projection for the law -- $71.2 billion by the end of 2014.

But wait, that's only spending to date.  How does it look going forward?

This is only the tip of the iceberg when it comes to spending on the coverage provisions of the Affordable Care Act. The Bloomberg study reveals that only about 20 percent of the $73.5 billion that has been spent on the health-care law thus far can be attributed to the law’s premium subsidies. CBO has estimated that the subsidies are expected to cost more than $650 billion through 2019, with the Medicaid expansion accounting for a minimum of $350 billion in additional spending.

In other words, over $100 billion per year in additional spending, and all to achieve maybe a handful of percentage points of reduction in the rate of uninsured.  That would be about $10,000 per year per person newly insured, or $40,000 for each family of four newly insured.  Nobody has a Cadillac health plan that expensive.  And mind you, it's not that these people weren't previously getting treated when they got sick.

Well, Obamacare has achieved one thing.  And that is that somehow the "crisis of the uninsured" seems to have gone away.  In 2009 45.7 million uninsured was somehow a desperate crisis, but in 2014 47.2 million uninsured somehow is no longer a crisis at all.  At least I can't find anyone saying it is.  Certainly not IOM.  The only difference I can see is that meanwhile the bureaucracy got an extra hundred billion or so of annual taxpayer money to play with.