Thursday, November 28, 2013

Regarding the Claim that the ACA Bent the Health-Care Cost Curve Downward: A Proposition of Know-it-Alls vs. Know-Nothings?

One might consider taking a moment and reading the opinion piece by David Cutler, Obama Administration advisor, regarding his claim that the ACA bent the cost curve downward for health-care:

“But the focus on insurance coverage obscures other parts of the ACA that are working well, even better than expected. It is increasingly clear that the cost curve is bending, and the ACA is a significant part of the reason.” - The health-care law’s success story: Slowing down medical costs, David Cutler, professor of economics Harvard, opinion, Washington Post, 11/08/2013

Link to the entire Article appears below:

Now examine Charles Blahous essay refuting Cutler’s claim:

One particularly egregious example is White House advisor David Cutler’s op-ed published November 8 in the Washington Post, entitled, “The health care law’s success story: slowing down medical costs.” This piece contains the following paragraph:

“Before he was criticized for his statements about insurance continuity, President Obama was lambasted for his forecasts of cost savings. In 2007, Obama asserted that his health-care reform plan would save $2,500 per family relative to the trends at the time. The criticism was harsh; I know because I helped the then-senator make this forecast. Yet events have shown him to be right. Between early 2009 and now, the Office of the Actuaries at the Centers for Medicare & Medicaid Services has lowered its forecast of medical spending in 2016 by 1 percentage point of GDP. In dollar terms, this is $2,500 for a family of four.”

To see why this is wrong, it is useful to break down this paragraph’s thesis into its component parts. Specifically, it claims that:

The President’s previous assertions that his “health-care reform plan” would “save $2,500 per family” have been “shown” “to be right,” and that;
This is proved by the fact that the CMS actuaries have lowered, between early 2009 and now, their forecast of medical spending in 2016 by $2,500 per family.

For this paragraph to be correct, the ACA must be the reason the CMS actuaries have lowered their 2016 health spending projections. That is flatly untrue.’

‘The obvious point that leaps out from this graph is that the chief CMS actuary found that the ACA would increase national health expenditures through 2016. Not content to let the tables speak for themselves on this point, CMS was explicit in the text of its memorandum that the ACA increased the near-term cost projections:

“The estimated effects of the PPACA on overall national health expenditures (NHE) are shown in table 5. In aggregate, we estimate that for calendar years 2010 through 2019, NHE would increase by $311 billion or 0.9 percent, over the updated baseline projection that was released on June 29, 2009. Year by year, the relative increases are largest in 2016, when the coverage expansions would be fully phased in…The increase in total NHE is estimated to occur primarily as a net result of the substantial expansions in coverage under the PPACA…” '

‘But no one can rightly claim that CMS has revised their near-term cost projections downward because of the ACA. That is simply false.’ - No Grounds for Claim that Obamacare Lowers Healthcare Costs, Charles Blahous, Manhattan Institute, 11/25/2013

Link to the entire article appears below:

Who is right and who is wrong? Comparing the two presentations, Cutler’s argument appears as a notional proposition whereas Blahous’s argument appears based upon empirical information that pointedly refutes Cutler.

But maybe, just maybe, one might be asking the wrong question about the two claims regarding the health-care cost curve. What question should be asked? Maybe the real question is: Why is the Obama Administration, and advisors thereof, either all-knowing or not knowing? How so?

The Obama administration, taking claim for lower health-care costs, is based upon the implicit assumption of: They knew all along, where completely abreast of the situation, were the rain maker. That is, when they claim something positive regarding Obamacare (ACA) they also claim they were well aware of the situation. The proverbial: “Told you so!”

Conversely, when something is negative e.g. web site mess, cancellation letters, narrow networks (aka "Medicaid-Plus") etc., regarding Obamacare, then in these situations, they implicitly and explicitly were unaware, never knowing and not knowing. The proverbial: “We are as surprised as you!”

How very odd for the Obama Administration and advisors thereof to be so very, very well aware of supposed positive aspects of ACA and simultaneously to be completely and totally unaware of negative aspects of ACA.

Hence one is faced with a situation in which, Obamacare, in its action phase, considering the authors and advisors thereof, is an all-knowing intentional consequence while simultaneously being a know-nothing unintentional consequence. Stated alternatively, the authors and advisors of Obamacare knew all along, where completely abreast of the situation, were the rain maker and simultaneously knew-nothing, not abreast of the situation, and not responsible.

Which leads one to think that the authors and advisors of Obamacare designed and studied Obamacare, in such a particular way, that they are either know-it-alls or know-nothings.







Wednesday, November 27, 2013

Online Small Business Marketplace: Delayed in April, Delayed in September, Now Shelved Until November 2014

‘The Obama administration announced Wednesday it would delay a significant piece of the health-care law: the online small business insurance marketplace.

The Small Business Health Options Program, known as the SHOP exchange, will not offer online enrollment until November 2014, a one-year delay from a launch that was initially planned for this past October.

Administration officials characterized the decision as one made necessary as they prioritized fixes to the individual health exchange, which the White House has promised will "work smoothly for the vast majority of users" by Dec. 1.’

‘The federal delay effects the 36 states where the federal government is running the health insurance exchange. It does not change the small business options in the 14 states and the District of Columbia that are running their own exchanges.

The White House announced last April a one-year delay to the "consumer choice" function in the SHOP exchange, which would allow each employee to pick their own insurance plan, pushing that functionality back until the 2015 open enrollment season.

That delay was followed with another setback in September when the White House announced that online shopping in the small business exchange would not be available when open enrollment started in October.
Under the new Obama administration proposal, small businesses will now have to "go directly to an agent, broker or to an insurance company with plans certified by the Marketplace," the Q&A document states. "The insurer must agree to offer direct enrollment in SHOP coverage and to conduct enrollment according to HHS requirements." ‘ - Obamacare’s online SHOP enrollment delayed by one year, 11/27/2013, Washington Post

Link to the entire article appears below:

Related story: Small business Obamacare online enrollment delayed a year, Politico, 11/27/2013


Saturday, November 23, 2013

Train Wrecks For Dummies: Technocratic Lesson On The One-Best-Way to Crash Your Obamacare Train

"When the realization of impending disaster finally hit government officials at the Aug. 27 meeting — just 34 days before the site went live — they threw out nearly 30 requirements, including the Spanish-language version of the site and a payment system for insurers to receive government subsidies for the policies they sold.

Even then, the system failed a test of only 500 simulated users in late September. Panicked, agency officials sent out an urgent order to almost double the system’s data capacity, technicians involved in the project have now confirmed. But the site was still down more than half the time in mid-October.

The acrimony between the Medicare agency and CGI had built steadily over the preceding months, the new interviews show. By late summer, teams of agency officials had parked themselves in CGI Federal’s headquarters in Herndon, Va., demanding on-the-spot reviews and demonstrations of new code that was never tested. Agency officials complained that CGI missed crucial deadlines and that it could not control other contractors, although the company said it had no power to do so.

CGI and other contractors complained of endlessly shifting requirements and a government decision-making process so cumbersome that it took weeks to resolve elementary questions, such as determining whether users should be required to provide Social Security numbers. Some CGI software engineers ultimately walked out, saying it was impossible to produce good work under such conditions.

“Cut corners, make date,” said one specialist, who like most of the people interviewed for this article would not allow his name to be used because the Obama administration has requested that all government officials and contractors involved keep their work confidential.” - Tension and Flaws Before Health Website Crash, NYT, 11/22/2013

Link to the entire article appears below:






Thursday, November 21, 2013

American Enterprise Institute: The Second and Bigger Wave of Health Insurance Cancellations Estimated at 50 million to 100 million

"A new and independent analysis of ObamaCare warns of a ticking time bomb, predicting a second wave of 50 million to 100 million insurance policy cancellations next fall -- right before the mid-term elections.

The next round of cancellations and premium hikes is expected to hit employees, particularly of small businesses. While the administration has tried to downplay the cancellation notices hitting policyholders on the individual market by noting they represent a relatively small fraction of the population, the swath of people who will be affected by the shakeup in employer-sponsored coverage will be much broader.

An analysis by the American Enterprise Institute, a conservative think tank, shows the administration anticipates half to two-thirds of small businesses would have policies canceled or be compelled to send workers onto the ObamaCare exchanges. They predict up to 100 million small and large business policies could be canceled next year." -  Second wave of health plan cancellations looms,, 11/20/2013

Link to entire article appears below:

Wednesday, November 20, 2013

ACA Web Site and the McKinsey & Co. Report: "warned of possible widespread site failures" in March, 2013

“President Barack Obama, who has portrayed himself as surprised by technical problems with the government's new healthcare website, was briefed earlier this year on a consultant's report that warned of possible widespread site failures, the White House said on Tuesday.

There have been weeks of questions about whether Obama understood the depth of the site's problems and let it open anyway, or simply "did not have enough awareness" of them, as the president stated at a Nov. 14 news conference.

While the government says it is improving the portal's performance every day, security experts told a Republican sponsored congressional hearing Tuesday that in their opinions, it is still not sufficiently secure to be used confidently by consumers.”

“Bits and pieces have leaked out over the past few weeks about flaws in the site's development process. Monday night, however, Republican lawmakers who oppose Obamacare released a report and recommendations prepared by McKinsey & Co. at the government's request in March 2013.

It cited, among other things, a rushed process that left insufficient time for testing and a focus by officials on getting people enrolled versus making the system work right.

The consequence, it said, could be system failures that could make enrollment slow or at times impossible for consumers, which is exactly what happened.

Questioned about the McKinsey study, White House spokesman Jay Carney said the president had been briefed on it in the spring.

But he said the president's familiarity with the report and recommendations did not contradict previous statements from the White House that described Obama as surprised by the scope of flaws in

Obama was told that the problems identified by McKinsey were being addressed, Carney said. And Obama had never claimed to be unaware of "red flags" about the site, only of their seriousness.”

- Obama Was Briefed Last Spring on Obamacare Problems, Thomson/Reuters via, 11/20/2013

Link to the entire article appears below:





Tuesday, November 19, 2013

Obamacare Web Site is The Bridge To Nowhere: 30-40% Not Built Yet Including the Payment System. No Way! Way!

“REP. CORY GARDNER: Well how much do we have to build today, still? What do we need to build? 50 percent? 40 percent? 30 percent?

HENRY CHAO: I think it's, uh, just an approximation, we're probably sitting somewhere between 60 and 70 percent because we still have to build...

GARDNER: Wait, 60 or 70 percent that needs to be built, still?

CHAO: Because we still have to build the payment systems to make payments to insurers in January.

GARDNER: Let me get this correct. Sixty to 70 percent of still needs to be built?

CHAO: It's not really about -- it's the federally-facilitated marketplace.

GARDNER: The entire system that the American people are being required to rely upon...

CHAO: -- the online application, verification, determination, plan compare, getting enrolled, generating the enrollment transaction -- that's 100 percent there.

GARDNER: But the entire system is 60 to 70 percent away from being complete.

CHAO: There's the back office systems, the accounting systems, the payment systems...they still need to be done.

Remember, the witness here isn't some random administration lackey. He's Obamacare's top IT manager -- the same guy who recently testified that he sounded alarm bells back in July that was headed for a "plane crash." He's also the man who first started muttering publicly about trying to avoid a "third world experience" in March.” - CMS Official: We Still Haven't Built '30 to 40 Percent' of Obamacare's Web Apparatus, Including Payment Systems,, 11/19/2013

Link to the entire article appears below:


Monday, November 18, 2013

You Question the Obamacare Fix? You are Fired! D.C. Insurance Commissioner William P. White Fired on Friday 11/15/2013

“A day after he questioned President Obama’s decision to unwind a major tenet of the health-care law and said the nation’s capital might not go along, D.C. insurance commissioner William P. White was fired.

White was called into a meeting Friday afternoon with one of Mayor Vincent C. Gray’s (D) top deputies and told that the mayor “wants to go in a different direction,” White told The Washington Post on Saturday.”

“In a statement issued Thursday, White hinted strongly that he opposed the idea.

“The action today undercuts the purpose of the exchanges, including the District’s DC Health Link, by creating exceptions that make it more difficult for them to operate,” the statement said.

He also pointed to a statement issued by the National Association of Insurance Commissioners that said the Obama order “threatens to undermine the new market, and may lead to higher premiums and market disruptions in 2014 and beyond.”

“We concur with that assessment,” White said Thursday.

White’s statement was removed from the department’s Web site sometime before Friday morning. Asked about the removal Friday, spokesman Michael Flagg said the department’s statement had changed.

“Our statement now is that we’re taking a close look at the implications of the president’s announcement on the District’s exchange and we will soon recommend a course of action after taking into consideration the positions of all the stakeholders,” Flagg wrote in an e-mail.” - D.C. insurance commissioner fired a day after questioning Obamacare fix, Washington Post, 11/16/2013

Link to the entire article appears below:




Sunday, November 17, 2013

Botched ACA Web Site: A Closer Look at CGI Federal and American Management Systems

'Republicans were relishing yet another Obamacare embarrassment Saturday after The Washington Post reported that the lead contractor for the federal health care website employs top executives from a troubled tech company responsible for massive failures on other government jobs.'

' has been plagued with glitches and technical problems, and new figures released by the Obama administration this week showed that only 27,000 Americans have made it all the way through the process to select insurance plans.

The Post reported that the parent of CGI Federal took over the troubled company, American Management Systems (AMS), but kept many of its executives, include the current and past presidents of CGI, its vice president for federal health care and its health IT leader.

AMS' technical failures included a tax system for Fairfax County, Va., and a project for the Federal Retirement Thrift Investment Board, which manages the 401(k) accounts of 4.6 million former and current federal employees, the newspaper reported. The company ended up paying $185 million to the state of Mississippi at one point after failing to deliver a new tax system.'

 ' "They did not provide us one working piece of software after almost six years,'' former Mississippi revenue commissioner Ed Buelow Jr. told the Post. "There were hundreds of errors. Nothing worked.'' ' - Report: contractor tied to troubled tech firm, USA Today, 11/16/2013

Link to entire article appears below:

ACA is a Good Deal for Young People? The Most Healthy and Least Wealthy Subsidize the Least Healthy and More Wealthy? Huh?

Saturday, November 16, 2013

Fred Upton “Obamacare Fix” Passes The House of Representatives 261-157: Keep Your Plan and Keep Selling the Old Plans.

“Thirty-nine House Democrats on Friday broke ranks to support a Republican bill that would allow health insurers to continue selling plans canceled under Obamacare through 2014, the first test of support on Capitol Hill since the law’s disastrous rollout.

The House voted, 261-157, to pass the bill by Rep. Fred Upton (R-Mich.). It’s a significant show of disloyalty to the White House, but House Democrats had expected the defections to be far higher before the Obama administration said Thursday that it would pursue an administrative fix to the cancellation problem.

Obama’s White House vowed to veto the bill, saying it “threatens the health security of hard working, middle class families.” The bill is headed nowhere in the Democratic-led Senate, where a number of Senate Democrats have also proposed their own changes to the health care law.” - With 39 Dems behind it, House passes Obamacare fix,, 11/15/2013

Link to the entire story appears below:

Friday, November 15, 2013

Hillary Clinton 2007 Presidential Candidate: "If you have private insurance you like, nothing changes — you can keep that insurance." No Way! Way!

“When former President Clinton this week critiqued President Obama's broken promise that Americans would be able to keep their health insurance plans under the Affordable Care Act, Clinton was also knocking a similar plan once proposed by another politician: his wife.

"I personally believe, even if it takes a change in the law, the president should honor the commitment that the federal government made to those people and let them keep what they got," Clinton said in an interview with OZY.

The remark came across as a stern rebuke of current White House policy — but it could also prove tricky for former Secretary of State Hillary Clinton, who is moving toward a bid for president in 2016.

When she was last a candidate for president in 2007, Hillary Clinton unveiled her own health care proposal, which, like Obamacare, included beefed-up benefits and a catchy pitch: "If you have a plan you like, you keep it." Obama went on to defeat Clinton, but he adopted her tag line to help win support for his own health care plan -- making the same promise, for which he recently apologized.

You can keep the doctors you know and trust. You keep the insurance you have," Clinton said on Sept. 17, 2007, at the Broadlawns Medical Center in Des Moines, Iowa. "If you have private insurance you like, nothing changes — you can keep that insurance."

Clinton's campaign website echoed that claim. "If you have a plan you like, you keep it," it read.” - Hillary Clinton in 2007: 'If you have a plan you like, you keep it', Washington Examiner, 11/15/2013

Link to the entire article appears below:



Thursday, November 14, 2013

ACA Cancelled? Prior Policy on Death Row? A One Year Reprieve .…Maybe, Sorta, Kinda.

WASHINGTON — Bowing to pressure, President Barack Obama on Thursday announced changes to his health care law to give insurance companies the option to keep offering consumers plans that would otherwise be canceled.

The administrative changes are good for just one year, though senior administration officials said they could be extended if problems with the law persist. Obama announced the changes at the White House.

"This fix won't solve every problem for every person, but it's going to help a lot of people," the president said.’

‘It's unclear what the impact of Thursday's changes will be for the millions of people who have already had their plans canceled. While officials said insurance companies will now be able to offer those people the option to renew their old plans, companies are not required to take that step.

Insurance companies will be required to inform consumers who want to keep canceled plans about the protections that are not included under those plans. Customers will also be notified that new options are available offering more coverage and in some cases, tax credits to cover higher premiums.

Under Obama's plan, insurance companies would not be allowed to sell coverage deemed subpar under the law to new customers, marking a difference with legislation that House Republicans intend to put to a vote on Friday.

Only last week, Health and Human Services Secretary Kathleen Sebelius told a Senate panel she doubted that retroactively permitting insurers to sell canceled policies "can work very well since companies are now in the market with an array of new plans. Many have actually added consumer protections in the last three-and-a-half years." ‘ - Policy cancellations: Obama will allow old plans,, AP, 11/14/2013

Link to the entire article appears below:




ACA: The Self-Interest of the Cancellation Makers and the Visible Hand of Politicos

“WASHINGTON — Anxious congressional Democrats are threatening to abandon President Obama on a central element of his signature health care law, voicing increasing support for proposals that would allow Americans who are losing their health insurance coverage because of the Affordable Care Act to retain it.

The dissent comes as the Obama administration released enrollment figures on Wednesday that fell far short of expectations, and as House Republicans continued their sharp criticism of administration officials at congressional hearings examining the performance of the health care website and possible security risks of the online insurance exchanges.

In addition, a vote is scheduled Friday in the Republican-controlled House on a bill that would allow Americans to keep their existing health coverage through 2014 without penalties. The measure, drafted by Representative Fred Upton, the Michigan Republican who is the chairman of the Energy and Commerce Committee, is opposed by the White House, which argues that it would severely undermine the Affordable Care Act by allowing insurance companies to continue to sell health coverage that does not meet the higher standard of Mr. Obama’s health care law.”

“In a closed-door meeting Wednesday of House Democrats and White House officials, tensions flared as several lawmakers upbraided the administration, saying that the president had put Democrats in a tough political position by wrongly promising consumers that they could keep their existing health care plans. In fact, hundreds of thousands of Americans have received cancellation notices from their insurers because their health care coverage does not meet the minimum standards dictated by the new law.

“I’m frustrated in how it rolled out, and I let them know in no uncertain terms,” said Representative Mike Doyle, Democrat of Pennsylvania. “The point I was making in caucus to the administration is don’t give us this techno-babble that you’re going to do some administrative fix down the road. There’s a bill being put on the floor on Friday.”

The overall message of the meeting, said several attendees, was that the White House and the House Democratic leadership have until Friday to come up with a satisfactory alternative, or House Democrats may be forced to support Mr. Upton’s bill, which already has two Democratic co-sponsors: Representatives John Barrow of Georgia and Mike McIntyre of North Carolina, who represent more conservative districts.” - With Enrollment Slow, Some Democrats Back Change in Health Law, NYT, 11/13/2013

Link to the entire article appears below:

Updated: Sen. Cornyn: Democrats in 'Near Panic' Over Obamacare, newsmax, 11/13/2013





Sunday, November 10, 2013

Obama’s ATM vs. Obama’s Tech Surge

Consider these propositions: Obama and ATM’s; Obama and Obamacare insurance exchange web sites which were suppose to be like shopping experiences at Travelocity or Amazon; Obama and the “tech surge” to fix Obamacare insurance exchange web sites. (1) (2) (3)

Hence technology is sinister and job destroying when it is handy to make a Luddite/Neo-Luddism political argument regarding automated teller machines (ATM‘S). Technology is great and grand as a political argument regarding a labor saving device when it is for insurance purchases on a web site. Technology to fix broken technology is a political argument of labor saving devices to save broken labor saving devices. (4) (5)

One is a Luddite when being a Luddite is convenient. One is all about technology when being techie is convenient.

The common thread being: convenient political arguments.



(1) Barack Obama Thinks an ATM Ate Your Job, Redstates, 07/15/2011

(2) New health insurance markets: Not like Travelocity, Yahoo News, 07/26/2013

(3) Obama administration vows 'tech surge' for, Cnet, 10/20/2013

(4) Luddite

(5) Neo-Luddism.







Saturday, November 9, 2013

The Renaming of ACA to Obamacare: The Consequences of a Smashing Failure in Relation to Milton Friedman’s “Monument Building”

WASHINGTON — President Obama was seething. Two weeks after the disastrous launch of, Obama gathered his senior staff members for what one aide recalled as an “unsparing” dressing-down.

The public accepts that technology sometimes fails, the president said, but he had personally trumpeted that would be ready on Oct. 1, and it wasn’t.

“If I had known,” Obama said, according to the aide, “we could have delayed the website.”

Obama’s anger has lit a fire under the West Wing staff. Senior aides are racing to make sure the website is fixed by the end of the month as they confront the political fallout from presidential promises, now broken, that Americans who liked their existing health care plans could keep them.” - White House in Crisis, as Other Work Goes On, NYT, 11/08/2013 (1)

If one goes back in time the term “Obamacare”, as a substitute for the Affordable Care Act (ACA), was attacked by the mainstream media as being “derogatory”.

However as time passed the term caught on and is used as often or more often than ACA. Mr. Obama, when later confronted with the term “Obamacare”, said it was fine with him to refer to ACA as Obamacare.

Hence the term goes from derogatory, to mainstream, to acceptable and embraced. The path of derogatory to embraced is worth examining as is the embracing in relation to subsequent events. How so?

Does one “embrace” the otherwise supposed derogatory comment because one is a narcissistic? Huh? If one’s name is attached, as might be the case with a monument or government building, is it not a form of Milton Friedman’s “monument building”? Hence having particular legislation carry one’s name as a synonym for the legislation is akin to one having one’s name placed upon and/or associated with a monument [Friedman’s observation]. (2)

For a moment assume the monument discussion above of named legislation is correct. What does one do when the legislation, bearing one’s name, becomes the Spruce Goose? Does the name - labeled -legislation and subsequent disaster become the ultimate folly for the narcissistic?




(2) “An Alternative to Aid: An Economist Urges U.S. to Free Trade, End of Grants of Money”* by Milton Friedman Wall Street Journal, 30 April 1962.


Update: "Last week, Pelosi chastised a reporter during a press conference for calling the act Obamacare and not the Affordable Care Act." - Gingrich: Obamacare by Any Other Name Still Stinks, Newsmax, 03/23/2014


Friday, November 8, 2013

The Few, The Angry, the Ten Million Cancellations: What About the Political Economy of the Ten Million Cancellations?

"There's a problem, that "a small percentage of folks" (8-10 million people) are facing canceled individual market health insurance plans, and some of them are "disadvantaged" by the new options, or will be once they can see them on a functioning The President has directed his team to consider some administrative solutions to fix the problem, to "address some of those gaps."

The problem with the President's public statement is that he has now frozen the individual insurance market in place until he announces his new solutions. If you are one of the 8-10 million Americans with a canceled insurance policy, President Obama just created an enormous incentive for you to hold off on buying a new policy, to wait for the Administration to offer you a new solution.

Had they announced a new solution today, they would not have created this problem. The disincentive to buy a new plan comes from offering hope of a better outcome with no specificity or timeframe.

This new disincentive to buy insurance applies nationwide and is independent of the broken federal exchange website. I expect states running their own exchanges like California and Colorado, Minnesota and Maryland, DC, New York, and Connecticut, will see their new enrollments now drop as those with canceled policies wait for the President's next move. States participating in the federal exchange won't see any drop because the broken website is already preventing signups. Still, even in those states the President has created a new reason not to buy insurance on the exchange when it eventually does work, at least until he announces his new policy.

Because the story is so hot, and because the President's allies in Congress are desperate to offer their angry constituents some hope, we can be assured that the President's ambiguous offer of future hope, and the purchasing disincentive it creates, will get a lot of attention.
The optimistic interpretation for this new policy signal is that President Obama and his team understood this balance when the President spoke yesterday, that they weighed the cost of further discouraging new signups against the benefit of partially relieving growing pressure to help angry citizens who liked their canceled policies.” - Another Unforced Error, Keith Hennessey, 11/08/2013


Link to the entire blog post appears below:


Thursday, November 7, 2013

For-Profit or Non-Profit in Health-Care and Health Insurance: Who in Fact is Supplying the Majority of Health-Care and Health Insurance?

A common talking point/debate point in the ongoing ACA debate is: for-profit health-care and health insurance is a mal-motive in health care/health insurance and hence leads to inefficiencies. As with most debate points little insight is gained and merely debate points earned.

What about for-profit in health-care and health insurance? Is the majority of health-care and health insurance produced by for-profit or non-profits? What form, for-profit or non-profits, is in fact providing the majority of supply regarding health care and health insurance? Who in fact is producing inefficiencies?


Consider this:

“My cost-cutting examples are all for-profit companies. About 70% of hospitals and 85% of health-care employment is in non-profits, (10) whose legal and regulatory treatment protects much inefficiency from competition.”

“Maybe for-profit companies pay too much attention to stock prices. But non-profits can go on inefficiently forever, with no stockholders to complain. The whole point of a non-profit is to pursue goals other than economic efficiency.” (1)

**10 Lakdawalla, D., and T. Philipson (2006), “Non-Profit Production and Industry Performance”, Journal of
Public Economics, v 90 (9), 1681-98.

The sophistry of the for-profit talking point/debate point of mal-motive leading to inefficiencies is further illustrated in that the vast majority of health insurance supply is non-profit [e.g. Blue Cross, Kaiser Permanente, Health Care Service Organization, and Himark, Inc. not to mention Medicaid and Medicare]. “…more than 60% of the health insurance providers in America with at least 100,000 subscribers are nonprofit organizations” (2) (3)

Hence one ends with the talking/debate point of for-profit health-care and health insurance as a mal-motive in health care/health insurance leading to inefficiencies, as completely backwards, as the majority of health-care supply and health insurance supply is provided by non-profits. Further, as pointed out by Cochrane: “The whole point of a non-profit is to pursue goals other than economic efficiency”.




(1) After the ACA: Freeing the market for health care, John H. Cochrane, October 18 2012, pg. 6

Updated version 02/06/13:

(2) Do non profit health insurance companies exist? Health insurance provider, 01/04/2012

(3) Basic facts & figures: nonprofit health plans. Alliance for Advancing Nonprofit Health Care.

Obamacare by Morning....Over Six Served! Carrie Underwood and Brad Paisley

Monday, November 4, 2013 You Can Now Post Your Health Insurance Cancellation Letter for the World to See.

Upset at your recent health insurance cancellation notice? You can now post your health insurance cancellation letter on the web site

They have accumulated quite the list of letters! Apparently you are not alone.

Link to the web site is: The e-mail to send your cancellation letter to is: .

Friday, November 1, 2013

ACA Enrollment Numbers? Sorry, Not Available. Now Suddenly available: Six Enrollments the First Day. No Way! Way!

'The website launched on a Tuesday. Publicly, the government said there were 4.7 million unique visits in the first 24 hours. But at a meeting Wednesday morning, the war room notes say "six enrollments have occurred so far."‘

They were with BlueCross BlueShield North Carolina and Kansas City, CareSource and Healthcare Service Corporation.

By Wednesday afternoon, enrollments were up to "approximately 100." By the end of Wednesday, the notes reflect "248 enrollments" nationwide.’

‘The notes leave no doubt that some enrollment figures, which the administration has chosen to keep secret, are available.

"Statistics coming in," said notes from the very first meeting the morning of Oct. 2. Contractor "QSSI has a daily dashboard created every night."

But head of CMS Marilyn Tavenner would not disclose any figures when Rep. Dave Camp, chair of the House Ways and Means Committee, asked earlier this week.

"Chairman Camp, we will have those numbers available in mid-November," she said.’ - Obamacare enrollments got off to very slow start, documents show, CBS, 10/31/2013

Link to the entire article appears below:

Updated 11/02/2013

“The Republican-led House Ways and Means Committee on Friday threatened to subpoena the Obama administration in an effort to obtain enrollment numbers for the new health care exchanges amid reports only six people signed up for ObamaCare on its first day.

Rep. Dave Camp, R-Mich., the committee's chairman, told Medicare chief Marilyn Tavenner, the senior Obama administration official closest to the problem-plagued rollout of the health law, requesting that enrollment figures be released immediately.

"We are facing a crisis," Camp wrote. "The failed launch of the exchanges combined with the millions of cancellation notices is putting Americans health care coverage at risk. By all media accounts, enrollment in the exchanges is thus far significantly behind the administration's projections."

Camp cited media reports indicating the administration has direct access to daily enrollment figures. Raising questions about the administration's transparency on the rollout, Tavenner declined to provide the committee with signup numbers at a hearing this week.

The Obama administration has thus far not released any official numbers on ObamaCare enrollment, saying the first numbers would be released in mid-November after the Department of Health and Human Services collects data from a variety of different sources.

"The committee is not prepared to wait until 'around mid-November' for the administration's scrubbed and spun numbers," Camp wrote. "Enrollment data exists today that will help this committee begin to address the implications of the failed launch." - House committee threatens subpoena over ObamaCare enrollment numbers, Fox news, 11/02/2013

Link to entire article appears below:

It Is Not About You Nor Your Health Insurance. Rather it is About Them and Their Political Time Horizons

‘WASHINGTON — Already under fierce attack from Republicans over the new health care law, President Obama now faces broad and mounting Democratic concerns that the troubled start of the insurance program will cut into the political benefit the party received from the government shutdown and cost Democratic candidates in next year’s mid-term elections.’

‘ “I don’t think there’s confidence by anyone in the room,” said Sen. Jeff Merkley, an Oregon Democrat up for re-election next year, as he emerged from the closed-door meeting in the Capitol. “This is more a show-me moment.”

The anxious include not only senators and House members facing hotly contested races but those whose seats are considered safe, as well as lawmakers in states with Republican governors who have done nothing to promote the health care law and in states with Democratic governors who have created state-run websites and made every effort to sign up the uninsured.’

‘McDonough promised that the president would keep up the messaging war with the law’s opponents, and to be back in three weeks for another session.’ - Troubled Start for Health Law Has Democrats Feeling Anxious, NYT, 10/31/2013


Link to the entire article appears below:

ACA and the Talking Point “Better Coverage”. What Exactly is “Better Coverage” in Regards to Health Insurance or Any Insurance?

With upwards of one million individual health insurance plans already receiving cancellation notices and an estimated additional nine million more cancellations on the horizon, a general talking point coming forth from advocates of ACA (Obamacare) is similar to the following: "The White House does not dispute that many in the individual market will lose their current coverage, but argues they will be offered better coverage in its place, and that many will get tax subsidies that would offset any increased costs." (1)

What exactly is “better coverage”? 

Consumers of insurance are all different as all have individualistic situations based on their particular time and particular circumstance. James Goodfellow who just won the lottery for $100 million likely has no need for health insurance as James can self-insure. Warren Buffett needs health insurance? Jane Goodfellow, age 26, doesn’t want health insurance. Mary Sue with three children wants to allocate $500 per month to insurance while Sam wants a Cadillac plan and allocates $1500 per month for insurance. Which one has “better coverage”? James, Warren, Jane, Mary Sue or Sam?

The answer is that different coverage meets different individualistic situations based on differing time and circumstance. Hence Mary Sue would misallocate resources with Sam’s Cadillac plan and Sam would find very little satisfaction with Mary Sue’s $500 per month plan.

Why is a plan with a low deductible, narrow network, ten essential coverage items and a possible subsidy “better coverage” than a $10,000 deductible catastrophic illness major medical plan that is accepted widely by health-care providers? Why does a health insurance plan that has a price tag of $1200 per month “better coverage” than a health insurance plan with a $600 per month price tag?

Which leads one to examine the central planner’s notional proposition of “better coverage”. ACA, like any central plan, does not account nor can account for different individualist situations based on differing time and circumstance. Hence the central planner needs to put forth bumper sticker sized expressions such as “better coverage” in an Orwellian attempt to convince one that differing time and circumstance of individuals does not in fact exist and only the planner’s time and circumstance exists. (2)

The plans differ; the planners are all alike... - Frédéric Bastiat

Updated 11/03/2013

“Congressional Republicans have stoked consumer fears and confusion with charges that the health care reform law is causing insurers to cancel existing policies and will force many people to pay substantially higher premiums next year for coverage they don’t want. That, they say, violates President Obama’s pledge that if you like the insurance you have, you can keep it.

Obama clearly misspoke when he said that. By law, insurers cannot continue to sell policies that don’t provide the minimum benefits and consumer protections required as of next year. So they’ve sent cancellation notices to hundreds of thousands of people who hold these substandard policies. (At issue here are not the 149 million people covered by employer plans, but the 10 million to 12 million people who buy policies directly on the individual market.)

But insurers are not allowed to abandon enrollees. They must offer consumers options that do comply with the law, and they are scrambling to retain as many of their customers as possible with new policies that are almost certain to be more comprehensive than their old ones.

In all the furor, people forget how terrible many of the soon-to-be-abandoned policies were. Some had deductibles as high as $10,000 or $25,000 and required large co-pays after that, and some didn’t cover hospital care.” - Insurance Policies Not Worth Keeping, New York Times Editorial, 11/03/2013

Observation: Once again an argument emerges of: What exactly is “better coverage”? The New York Times editorial merely argues that time and circumstance of individuals is meaningless and freedom to choose is meaningless.

The argument is basically that their particular type-kind of coverage that they champion is “better coverage”. The New York Times editorial is merely a notional argument putting forth their notional proposition of “better coverage”, purposely-politically framing their notional proposition as fact, argued through verbal virtuosity, then attempting to deny opponents legitimacy. [Yawn]

Link to the entire editorial appears below:

Updated 11/10/2013

For some, losing so-called bad apple health insurance plans will mean paying more for less, Washington Examiner, 11/04/2013


(1) Obama administration knew millions could not keep their health insurance, NBC, 10/29/2013


(2) The Fatal Conceit, The Errors of Socialism, F.A. Hayek