The Doctor is In

In all the horse-race excitement, and gratifying panic on Fox News, over whether the ACA exchanges will reach the ”target” of 7m signups by midnight tonight, let’s remember that nothing of importance should hang on this. The CBO used 7m as their first estimate, in order to calculate the budgetary impact. Then they walked it back to 6m after the disastrous rollout of the healthgov site. Kathleen Sebelius once, in an unguarded moment, said that 7m on March 31 would be a “realistic target.” Obama never did. So it boils down to whether Fox will get their ten minutes of “gotcha!”

Looks like not. The initial number is likely to be reached anyway: Charles Gaba’s latest estimate is 6.9m-7.0m, within the range of statistical error. [Update 1/04/2014: Gaba has updated this to 7.08m today; the Administration claims 7m. Complete suite of Gaba's estimates here.]

Kevin Drum points out that the political survival of ACA has to be seen in a much longer time frame. The earliest a Republican President and Congress (it needs both) could repeal it is 2017, when ACA coverage will be much higher – over three times the current level. He reproduces an extract from the relevant CBO table (here, page 108, Table B2). He leaves out the CBO estimate of the uninsured, so here’s a line graph with everything – I cut it off at 2020, as the later estimates are just flatlines. The 2014 estimate for exchange policies is 6m, for Medicaid and CHIP is 8m.
ACA CBO chart

The CBO estimate is for the newly insured, and does not so far as I can see include those previously insured with substandard policies. They are in the table as part of the 2m reduction in nongroup coverage, but not as purchasers of policies on the exchanges. So there is technical merit in the talking point that the raw QHP total overstates the net impact. On the other hand, as Gaba says (go to his site for details), the exchange QHP total leaves out those enrolling directly with insurance companies and under 26s allowed by ACA to stay on their parents’ policies. Neither get a subsidy, so they are irrelevant to the federal budget, the CBO’s main concern.

It won’t be possible for some time to know the split among policy buyers between those previously ininsured, those previously under-insured, and those with compliant policies cancelled by insurance companies for financial reasons. In assessing the impact of ACA, the last group are basically statistical noise, though they would not like to hear their grievances so belittled. The first two groups are both targets of the law, so IMHO the split is not hugely important. Both include a minority of resentful purchasers who were happy with their previous situation – presumably a higher proportion of the underinsured, it takes extreme conceit and myopia to think that you are better off with no health cover at all.

The answer to Megan McArdle’s and Ross Douthat’s question whether ACA is now beyond repeal is yes. One reason is the demographic argument of Kevin Drum: in 2017 there will be, according to the CBO, 36 million Americans newly covered by ACA through exchange policies or Medicaid. That’s a huge number of voters. You have to live in Foxland to think that any great number of these will see themselves as victims of coercion rather than beneficiaries of a terrific entitlement.

The second reason comes from the ramshackle, Heath Robinson (Am.E: Rube Goldberg) nature of the Act. This makes it so hard to understand what is going on. More important, it means that any remotely feasible replacement will also be hugely complicated. Simple repeal and reversion to the status quo ante will be as as unacceptable to the electorate as single-payer. There is no sign in the current Republican Party of the adult willingness to engage in the analysis and negotiation needed to construct and sell a complex legislative reform – see the deafening silence that has greeted Don Taylor’s posts here proposing constructive conservative reforms. The GOP’s infantilism is the ACA’s best shield.

Maybe, just maybe, reaching the 7 million pseudo-target will embolden Democratic candidates in this year’s elections to stop hiding in their foxholes and actually defend their party’s greatest achievement in government since Lyndon Johnson.

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