ACA afflicted by a deductible cliff

The Atlantic's Olga Khazan recently went to Trump country in central Pennsylvania, near Harrisburg, and asked people what they thought of the Affordable Care Act.  A lot of the not-poor were resentful about the Medicaid expansion. Here's the owner of a hair salon who earns too much to qualify for a marketplace subsidy and is old enough to pay near-peak premiums:

Things got even worse for her this year, when several insurers pulled out of Pennsylvania’s Obamacare exchange, leaving her with just a few options, she said. Now, she pays $655 a month, and her deductible is $10,000. “Welcome to my shoes,” she said...

On average, ACA marketplace plans are gold equivalent

Kevin Drum has led me, indirectly, to an interesting fact about the ACA marketplace: the coverage in private plans sold there is not as skimpy as people tend to assume.

In a post published today, Kevin considers a Blue Cross Blue Shield analysis of their large ACA marketplace customer base. BCBS finds that marketplace enrollees on average are sicker and access more care than pre-ACA customers in the individual market, and also, to a lesser extent, than enrollees in employer-sponsored insurance (ESI).

Drum's response is basically hurrah -- people who were previously shut out of the individual market based on their medical history are now accessing the care they need (and insurers knew that they would be needier than existing customers in both markets; they just underestimated how much).

Drum notes that the health gap is much narrower between marketplace enrollees and those with ESI than between marketplace enrollees and those in the pre-ACA individual market. He then wonders:

Oddly, the BCBS report concludes that Obamacare enrollees used more medical services and ran up higher bills compared to those in employer plans. That's a little hard to make sense of, since Obamacare enrollees are no sicker than average and generally have higher deductibles and copays than people in employer plans, which should motivate them to use fewer medical services. One possibility is that this is related to heart disease, the one area where Obamacare enrollees really do seem to be sicker than average. Another possibility is that this is a one-time thing: lots of people had been putting off medical care, and when Obamacare kicked in they spent the next year or two making up for it.

Drum is not wrong in asserting that Obamacare enrollees on average "have higher deductibles and copays than people in employer plans" if you include those who buy ACA-compliant plans outside the marketplace, as the BCBS study does. Within the marketplace, however, it's only marginally true. And among the 83% of marketplace enrollees who receive subsidies, it's not true at all [updated 3/31 -- more below].

Trump the Incompetent

The Times reports the welcome news that Hillary Clinton's brain trust is taking the Trump threat very seriously and studying approaches to convince the disaffected that his promises are empty. Here's the emerging Democratic thinking, according to Amy Chozick and Patrick Healy:

The plan has three major thrusts: Portray Mr. Trump as a heartless businessman who has worked against the interests of the working-class voters he now appeals to; broadcast the degrading comments he has made against women in order to sway suburban women, who have been reluctant to support Mrs. Clinton; and highlight his brash, explosive temper to show he is unsuited to be commander in chief.

One potential problem, as Greg Sargent argues this morning, is that the "heartless businessman" attack used on Romney may not work in this case, because the nature of Trump's appeal is different. His followers respond to his assertions of "strength" -- and past heartlessness may only reinforce that. It might be more effective, as Kevin Drum has suggested, to point out Trump's serial business failures -- emphasizing not just that he hurt people, but that his promises were empty, his judgment comically bad, his execution terrible.

The Washington Post's account yesterday of the rise and swift fall of Trump Mortgage (founded in 2006!) provides a distilled essence of Trump's art of the debacle. Here's the Rise and Fall pattern, recounted by Tom Hamburger and Michael Kranish:

1. Ignore market signals

“I think it’s a great time to start a mortgage company,”  Trump told a CNBC interviewer in April 2006, adding that “the real estate market is going to be very strong for a long time to come.”

The ACA and the Working Class - Kevin Drum Festschrift

My festschrift contribution for Kevin Drum, who's recovering from a stem cell transplant in treatment for multiple myeloma, is up on Mother Jones. Kevin, give thanks, is doing very well, and managing to keep blogging on policy as well as track his treatment experience.

For those interested in the editing process -- as anyone who's ever edited inevitably is -- I thought my piece was skillfully shaped by Mother Jones managing editor Clint Hedler. Mostly he cut caveats and qualifications, which I've highlighted in the full draft below. Left to my own devices, I would leave the first and last highlighted sections in place and let the other cuts stand -- and I can see the case for all of them. I should be better at doing this to myself, as I spend half my day-job hours doing it to other people's articles.
---------------

One thing I've always appreciated about Kevin is that his commitment to economic justice is grounded in political realism.  That balance was on display in his postmortem on the Democrats' drubbing in November:

when the economy stagnates and life gets harder, people get meaner. That's just human nature. And the economy has been stagnating for the working class for well over a decade—and then practically collapsing ever since 2008.

So who does the WWC [white working class] take out its anger on? Largely, the answer is the poor. In particular, the undeserving poor. Liberals may hate this distinction, but it doesn't matter if we hate it. Lots of ordinary people make this distinction as a matter of simple common sense, and the WWC makes it more than any. That's because they're closer to it. For them, the poor aren't merely a set of statistics or a cause to be championed. They're the folks next door who don't do a lick of work but somehow keep getting government checks paid for by their tax dollars. For a lot of members of the WWC, this is personal in a way it just isn't for the kind of people who read this blog.

And who is it that's responsible for this infuriating flow of government money to the shiftless? Democrats. We fight to save food stamps. We fight for WIC. We fight for Medicaid expansion. We fight for Obamacare. We fight to move poor families into nearby housing.

This is a big problem because these are all things that benefit the poor but barely touch the working class. 

As Kevin acknowledges, this is an age-old problem for Democrats. It's "unfair" in that there's overwhelming evidence that safety-net programs like food stamps, Medicaid and the Earned Income Tax Credit "have positive effects on health, educational attainment, earnings and employment years later," as Jared Bernstein recently wrote. Conversely, programs popular with the middle class, such as the mortgage tax credit and tax-sheltered college savings plans, bestow the bulk of their benefits on the affluent. The distinction between "the poor" and "the working class" may also be too neat, given the volatility of Americans' incomes and the erosion of stable jobs at working class pay levels. An awful lot of working people access the benefits that Kevin lists, or have family members who do, (e.g., a large majority of food stamp beneficiaries). All that said, the perception that Kevin fingers is a political force, and partly grounded in reality, in that safety net programs (for the non-elderly at least) do most directly benefit those at the bottom of the income distribution.

Program note: Kevin Drum festschrift

I will be contributing to the Kevin Drum festschrift organized by Mother Jones as Kevin undergoes treatment -- thankfully, going quite well so farm and endured with grit and good humor --  for multiple myeloma. Kevin has perhaps been surprising himself with pretty active blogging through his chemo rounds, while Mother Jones staff and outsiders pitch in. Work on my contribution (finished, and running next week) along with this project has left this blog pretty fallow this week.

I note in the Mother Jones piece that I've always appreciated that Kevin's commitment to economic justice is tempered by political realism. His perceptions and assessments of Obama these past six years have also tracked pretty closely with -- and no doubt helped shape -- my own. That is, he sees Obama as "a sober, cautious, analytic, mainstream Democrat" who's substantively advanced a lot of progressive priorities while necessarily also disappointing liberal hopes on other fronts.

Where I've parted company from Kevin (and this is not the focus of next week's piece) is in reaction to Obama's rhetoric. He sees Obama's 2008 speeches and catch-phrases as "nothing more than typical campaign windiness." I see his rhetoric as an expression of the pragmatism Drum admires, articulating a nuanced, incremental sense of how progressive change occurs. That argument played out here and here.

Reagan Revolution rollback

Here's how Matt O'Brien, the Washington Post/Wonkblog economics reporter, characterizes Obama's new tax proposals:

The state of the union is pretty good, actually, but President Obama has an idea to make it better: taxing Wall Street and the super-rich to make middle-class work even more worthwhile. It's Piketty with an American accent.

Okay, that's a little bit of an exaggeration, but not a huge one. Obama's State of the Union, you see, will call for $320 billion of new taxes on rentiers, their heirs, and the big banks to pay for $175 billion of tax credits that will reward work. In other words, it's fighting a two-front war against a Piketty-style oligarchy where today's hedge funders become tomorrow's trust funders. First, it's trying to slow the seemingly endless accumulation of wealth among the top 1, and really the top 0.1, no actually the top 0.001, percent by raising capital gains taxes on them while they're living and raising them on their heirs when they're dead. And second, it's trying to help the middle help itself by subsidizing work, child care, and education.

Stepping back, it's amazing the extent to which Thomas Piketty's tome Capital in the 21st Century, published in the U.S. in January 2014, has focused the U.S. policy debate on income inequality. Some economists have been talking about rising inequality since the 1980s, but Piketty and his colleague Emmanuel Saez have more recently put the spotlight on the very top -- the top 1%, .1% and .01% (they first published major findings pointing that way in 2003, but post-crisis updates have been making news in recent years). The book put the trends on the front pages. Now Democrats, after a rather disastrous pause to protect red-state senators in the 2014 election, are putting inequality front and center in their policy proposals.

The ACA and the white working class

When Bill Gardner this morning pointed out, as many have, that Americans approve of the core components of the ACA but disapprove of the law, I expected the corollary to be "slander works," or"it's really hard to communicate how these moving parts fit together," or some combination of the two.

Instead, I was confronted with this chart from a paper by Henry Aaron and Gary Burtless:

Grazing in the gaffeteria

Kevin Drum meditates on "the usual preoccupation that political reporters have with process over substance":

For example, Steve Benen notes today that Kentucky Democrat Alison Lundergan Grimes recently dodged "a straightforward question about whom she voted for in the 2012 presidential election" and got hammered for it. But in Iowa, when Ernst refused to say if she wants to shut down the Environmental Protection Agency or what she'd do for those who’d lose health care coverage if Obamacare is repealed, the reaction was mostly crickets.

Reporters read insurance execs' testimony before yesterday's House ACA hearing. Looks like GOP reps didn't

Last week, the House Energy & Commerce Committee put out a mendacious report claiming that insurance company executives had submitted data to them showing that just two thirds of ACA private plan enrollees had paid their first month's premium. ACA signups tracker Charles Gaba shot that rotten fish in a barrel within an hour of the report's release:.

...they're VERY clear about what they're claiming: that as of 4/15/14, only 67% of all QHP enrollments via Healthcare.Gov had paid their first month's premium, right?

Well, there's a serious problem right there, because out of the 8 million or so enrollments as of 4/15, only 5 million of the first month's premiums were even due.

Gaba was the first of many; the claim was widely debunked. That didn't deter the Committee from calling health insurance executives to a May 7 hearing,  presumably to ratify their statistical legerdemain.  Unsurprisingly, the hearing, conducted by the Oversight and Investigations Subcommittee, did not go as planned. Jonathan Bernstein marvels at the manifestation of an apparent feedback loop:

But yesterday, a House subcommittee invited insurance company executives to testify and, according to the Hill, Republicans on the panel were “visibly exasperated, as insurers failed to confirm certain claims about ObamaCare, such as the committee's allegation that one-third of federal exchange enrollees have not paid their first premium.”

We don’t have to rely on reporter interpretations (here’s another one). It made no sense to hold the hearing unless Republicans were (foolishly) confident that the testimony would support their talking point, instead of undermining it.

The only plausible explanation is that closed feedback loop. Either members of the committee managed not to be aware of the criticisms of their survey, or they mistakenly wrote off the criticism as partisan backbiting.

Kevin Drum piles on:

Obviously Republicans were caught off guard at yesterday's hearing, and that could only happen if they really and truly believed their own flawed survey. And that, in turn, could only happen if they get pretty much all their information from Fox News and don't bother with anything else. 

The bubble is apparently more airtight even than Bernstein and Drum fathomed, because the executives' prepared testimony had already hit the newswires before the hearing started. Bloomberg's Alex Wayne had the whole gist in a story that ran on Wednesday morning, prior to the hearing:

The enemies of the ACA are failing

A couple of days ago, I noted that while the state-run Affordable Care Act exchanges were collectively outperforming HealthCare.gov, that apparent performance gap had been exaggerated by the lag in reporting by states relying on the Federal exchange. Since HealthCare.gov was barely functioning until early December, and some health exchanges were working well much earlier, I noted that the gap should continue to close as new numbers came in.

Today, HHS released state-by-state exchange signup numbers through 12/28. HealthCare.gov states are indeed catching up.  The fourteen states running their own exchanges, along with Washington D.C. (also running its own), encompass just about about one third of the U.S. population (slightly over 100 million people). Their 956,000 signups as of 12/28 comprised about 44% of the total of 2,152,000 signed up on the exchanges.(Honestly, I should have noted a ratio close to this in the prior post, as HHS has for some time claimed about a million signups on HealthCare.gov that it hadn't yet ascribed to specific states.)

The End of the End of History?

In The Origins of Political Order, Francis Fukuyama casts the history of the state as the history of the sovereign power's struggle to neutralize powerful subjects' (or citizens') biological imperative to pass their advantages on to their children  -- that is, the sovereign's attempts to neutralize the force of kinship ties, which are the means of building rival power centers. Sovereigns have come up with various ingenious means of checking the encroaching power of hereditary local elites, such as an exam-based civil service (China) or an imported elite slave class (Mamluk and Ottoman empires). The most successful and enduring of such means has been democracy, enabled by (and evolving from) rule of law and a strong state, wherein the majority retains the power to periodically trim or slap back back entrenched privilege.  Hence Fukuyama's faith, famously professed in The End of History, that a kind of Darwinian pressure of global competition would lead all states to embrace liberal democratic capitalism.

Recent years have dented that faith, however, as Fukuyama has come to fear that that other Darwinian pull -- of elites to pass their privilege to their offspring -- might batter down the walls of commonwealth.  Here's how he puts it in an article previewing his next book, Political Order and Political Decay, due out in September 2014:

Kevin Drum's dangerous indulgence

Kevin Drum gave in to temptation this afternoon (and I gather it's kind of Obama's fault):

A couple of hours ago I had a choice to make: spend the next hour writing a reaction to President Obama's big national security speech, or go to lunch. I went to lunch.

Such lapses can put us in danger. So claims Screwtape, C.S. Lewis' devil and master tempter (in Lewis' imagining, each of us is assigned a guardian devil, so to speak, as well as a guardian angel, and they battle it out moment by moment until we die). Read and tremble, midday indulgers:

I once had a patient, a sound atheist, who used to read in the British Museum. One day, as he sat reading, I saw a train of thought in his mind beginning to go the wrong way. The Enemy, of course, was at his elbow in a moment. Before I knew where I was I saw my twenty years' work beginning to totter. If I had lost my head and begun to attempt a defence by argument, I should have been undone. But I was not such a fool. I struck instantly at the part of the man which I had best under my control, and suggested that it was just about time he had some lunch. The Enemy presumably made the counter-suggestion (you know how one can never quite overhear what He says to them?) that this was more important than lunch. At least I think that must have been His line, for when I said, "Quite. In fact much too important to tackle at the end of a morning," the patient brightened up considerably; and by the time I had added "Much better come back after lunch and go into it with a fresh mind," he was already halfway to the door.

Capitulate, Chait! Succumb, Drum! Obama's rhetoric is a force for change

Two of the admirers of Obama I'm most attuned to claim a tough-minded immunity to the alleged intoxications of the president's rhetoric. Jonathan Chait, in a truly moving and incisive tribute to Obama's radical pragmatism, protests at the outset, "I never felt his election would change everything about American politics or government...Nothing Obama did or said ever made me well up with tears." Kevin Drum goes him one better:

I simply never took seriously any of Obama's high-flown rhetoric—Hope and change, Yes we can! You are the solution, etc.—dismissing it as nothing more than typical campaign windiness.

To which I must respond: Gentlemen! Tune in, turn on, don't cop out. Listen to what the man has been saying these five-plus years.

Romney on Rush: it's the thought that counts?

Asked to comment on Rush Limbaugh's slut-slur of law student Sandra Fluke after she testified about her classmates' need for contraceptive coverage, Mitt Romney took a prudish swat:

“I'll just say this which is it’s not the language I would have used," Romney said. "I’m focusing on the issues I think are significant in the country today and that’s why I’m here talking about jobs and Ohio.”

My immediate reaction on reading this was to wonder: is there some underlying idea in Limbaugh's bilge that Romney approves of? That women who want their health care coverage to pay for birth control are prostitutes, perhaps?

Kevin Drum has cleared up the point for me:

Windows of the faraway soul

Taking a busman's holiday from politics, reacting to a rapturous description of FDR Labor Secretary Frances Perkins' eyes, Kevin Drum turns his lonely eyes to us:

I'm pretty much oblivious to people's eyes. I could sit across from you for an hour in deep conversation and come away not even knowing the color of your eyes, let alone whether they scintillate or cloud over from time to time. So I am, sort of literally, a blind man when it comes to stuff like this. So I turn to you, my faithful readers. Are descriptions like this for real? It's part of the whole "eyes are the window to the soul" schtick, which has always seemed more poetic than verifiably factual to me, but what do I know?

I won't say that this query triggered a new thought, but it brought to the surface one of those vague perceptions that can resurface repetitively on cue for years and decades. It comes sometimes as I pass my own eyes over the many solitary self-contained bipeds one passes every minute walking down a block in Manhattan.  It's the opposite of sensing 'windows on the soul' -- rather a sense of how remote each consciousness is -- each of us a broadly similar organic machine, carrying millions-of-years-old DNA, aware of only the tiniest fraction of its own mental activity, having no idea how it got here, shaped by a mind-bogglingly complex matrix of biological and social destiny, and peering out of those elliptical windows with a consciousness as disconnected from mine as a cheetah's. 

Paint Romney as flip-flopper or right-winger? Both/and!

Methinks New York Times reporter Helene Cooper has posed a false choice for the Obama campaign.  But then, John Sides and Kevin Drum both accept the terms, so maybe I'm missing something.

As a plan of attack against Romney, Cooper asks:

Do they go the flip-flopper route? Or do they go the out-of-touch, protector-of-Wall-Street route?

Cooper acknowledges that the two paths may not be mutually exclusive. But then, recounting the campaign's pursuit of the flip-flopper meme, she undercuts that caveat:

My not-most-read posts of 2011

As Kevin Drum notes today, all the cool kids (himself now included) are putting up their most-viewed blog posts of the year. Well, you know how we uncool kids cope: with variations on a theme.  My most-read posts have all been boosted by links from my more-trafficked friends in the blogosphere. What I'd like to do here is pull out of storage a few posts that I could have wished had grazed a few more eyeballs.

First, recent readers may have noted how stimulated I've been by Steven Pinker's The Better Angels of Our Nature: Why Violence has Declined.  I've kept up a kind of response journal, in which I've oscillated between enthusiastic assent and various doubts and caveats. Why a running annotated read, instead of a finished review?  Well, I'm impatient, and it's a long book. But also: whatever you think about humanity's prospects, and whatever the weaknesses in Pinker's historiography, this is a book that changes the way you view history and the moment we're living in as you read. I keep viewing other things I read, and age-old musings, in light of it. I hope there's some value in recording this process. So here are the posts, earliest first:

The bettering angels of our nature
Better angels in the news
Religion helped develop our better angels
How our better angels' wings might be clipped
Better angels leave their kitchens in Cairo
Can humanity lead itself out to pasture?
Better dead than red, revisited
Better Angels in Super Hornets

Here are a few more posts, mostly nonpolitical, that I'd like to give a second chance:


The best liar in the field
A president confesses error and defends democracy
Rat race or fluid human dance?
Prophets of the new millennium
Five questions for Obama
Jeffrey Goldberg, excommunicator
Slo-mo grow on the plateau: Tyler Cowen's general theory of American malaise
About those free-range little Krugmans and Manzis
Ruth Marcus's false "false false choice" charge
MIA in the latest Jane Eyre

Thanks for reading! Stay tuned in 2012.

Say I ain't dumb, Drum! I bought Obama's rhetoric...and still do

Kevin Drum, en route to a fair-minded accounting of Obama's accomplishments and failings, blames liberal disappointment on Obama's campaign rhetoric:

Obama's core problem with his supporters from 2008, the ones who listened to his soaring rhetoric and believed he really was going to transform Washington — and have since been bitterly disappointed. This has always been something I could understand only intellectually, since I never for a second paid any attention to his stump speeches. Of course they soared! Of course they promised a new era! That's what politicians always promise. Why on earth would anyone take this seriously, when every single other piece of evidence showed him to be a cautious, pragmatic, mainsteam, center-left Democratic candidate?

This is the Gideon Rachman school of thought about Obama's hopemongering: that it was composed of"some of the most clichéd and least challenging slogans in the American political lexicon: unity not division; the future not the past; change not stagnation."

I beg to differ. Of course there is a lot of cliche in Obama's political speech -- political speech cannot subsist without it.  But there was always a good deal more -- evidence of a truly rare mind at work upon the political process and the historical moment.  Among the star-struck count a New Yorker editorialist, probably David Remnick, who in October 2008 compared Obama to Lincoln:

Obama has returned eloquence to its essential place in American politics. The choice between experience and eloquence is a false one––something that Lincoln, out of office after a single term in Congress, proved in his own campaign of political and national renewal. Obama’s “mere” speeches on everything from the economy and foreign affairs to race have been at the center of his campaign and its success; if he wins, his eloquence will be central to his ability to govern.

To those who think that Obama's call to hope and promise of change was just window dressing for a center-left laundry list of policy proposals, let me suggest the following:

A not-so-plain blog (post) about politics

Hmm. In a fit of absent-mindedness, Jonathan Bernstein may have just amended his theory of what makes democracy work, or what makes an elected democratic official a "good" one in a sense that goes beyond managing to stay in office a long time. Or perhaps he's just clarified a point that I don't believe was clarified before. Or just opened up a can of worms.

Let's start with the theory-qualifying snippet:

Where politicians and parties go wrong is when they adjust the policies they favor in order to be able to use the words that test well, and then mistakenly believe that the underlying policies are actually popular.

Most of us would not have any problem with that statement. But under Bernstein's theory of representation, it's not entirely clear that it matters whether "underlying policies" are popular, if the "words that test well" get the speaker elected or reelected. So, for a second time, let me pick a bone with the joyous cynicism animating Bernstein's celebration of a purely contractual relationship between elected official and voters.

Seeing beyond the trough we're in

Kevin Drum today takes on a meme gathering steam: that innovation has stalled, and we're in a period of relative technological stagnation. In particular, addressing the question of whether inventions in the last 50 years have been less transformative than those in the previous 50-odd, he argues:

Most of the best known inventions of the early 20th century were actually offshoots of two really big inventions: electrification and the internal combustion engine. By contrast, the late 20th century had one really big invention: digital computers. Obviously two is more than one, but still, looked at that way, the difference between the two periods becomes a bit more modest. The difference between the offshoots of those big inventions is probably more modest than we think too. Just as we once made better and better use of electrification, we're now making better and better use of digital computing. And to call all these computing-inspired inventions mere "improvements" is like calling TV a mere improvement of radio. These are bigger deals than we often think. We have computers themselves, of course, plus smartphones, the internet, CAT scans, vastly improved supply chain management, fast gene sequencing, GPS, Lasik surgery, e-readers, ATMs and debit cards, video games, and much more.

Drum is responding in large part to Tyler Cowen's The Great Stagnation. I'd like to second his skepticism.  In fact, some months ago I posed five questions for Cowen, e.g.: