The battle of the anecdotes: Gird yourself for Obamacare’s newest fight

By Sarah Kliff

Below is an interesting piece by Sarah Kliff on how the Affordable Care Act is changing the American health-care system — and being changed by it. At this stage, the report card for the program depends largely on who you ask.

Fliers promoting the Get Covered Illinois health insurance marketplace sit in a box at the Bureau County Health Department offices in Princeton, Illinois, U.S., on Wednesday, Dec. 18, 2013. Today’s deadline for Americans to sign up for Obamacare health coverage effective Jan. 1 was extended until midnight tomorrow as heavy traffic to the online enrollment system caused a queuing system to be activated.

If you want to believe Obamacare is going great, you should call up Linda Browne. She’s a 62-year-old retired accountant from California who already has an appointment to see her new primary-care doctor at Kaiser Permanente, the new health insurer she signed up with through Covered California.

“I thought I would have to wait a long time,” Browne says. “But when I called, they said she had an appointment Wednesday for a physical.”
If you’d prefer to believe Obamacare is going terribly, then Michael D. Scott has got a story for you. He’s a 36-year-old Texan who turned up at a pharmacy last week trying to fill a $700 prescription for anti-seizure medication — only to find the technicians had no record of his enrollment.
“I’m stuck,” says Scott, who takes the prescription to treat a genetic condition called Ehlers-Danlos syndrome. “I’m going to have to start buying a couple days’ worth on my own if they can’t figure things out. It’s disappointing.”

Both Browne and Scott signed up for health insurance through the Affordable Care Act. Browne has had the law work pretty well; Scott has spent hours on the phone with customer service representatives (actually, he spent one hour and 37 minutes on his last call — yes, he timed it). And stories like theirs are about to become central to the next Obamacare fight, what I like to think of as the battle of the anecdotes.

The battle of the anecdotes is all-but-guaranteed because access to health care is really difficult to measure, even more so than the number of people who have enrolled or how well HealthCare.gov is functioning. With enrollment, for example, HealthCare.gov can track all the people who pick a private insurance plan, as can the 14-state based insurance exchanges. That’s how we know 2.1 million people have selected private insurance plans (although we don’t know how many have paid their first month’s premium, which is due, for January coverage, by this Friday).

The federal government can gauge how well HealthCare.gov is working by tracking how long it takes pages to load, or how many enrollment files — known as ‘834s’ — contain errors. And the call centers know, too, how long customers have to wait to get a person on the line.

But when it comes to access to health care, there’s no analogous metric. Our health-care system is really fragmented. Since HealthCare.gov shoppers are buying private coverage, and not a government plan, we have no central clearing house to understand whether more shoppers are having an experience like Scott in Texas — or like Browne in California.

Nonprofit institutions do study these types of questions. The Commonwealth Fund, for example, regularly looks at how long patients in different countries have to wait to see a primary-care doctor or a particular surgeon. But these surveys take months to conduct and analyze, meaning that we will probably have to wait until late 2014 or early 2015 to get a sense of what access looks like under the Affordable Care Act.

Enter the anecdote, which can be great to understand how new policy programs are impacting the way that Americans receive health care. But they can also be a really terrible way to gauge whether Obamacare is going great — or is a complete disaster. One or two stories don’t do a great job of capturing the experience of the millions of Americans who have signed up for health plans.

And even the anecdotes themselves can be nuanced, portrayed in different ways to make Obamacare seem great, or horrible. Take Browne: She called for an appointment in her new network the morning of Jan. 2. But she couldn’t get through to a real, live person until that afternoon; she kept getting a message that said “all circuits are busy.”

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For Obamacare, Some Hurdles Still Ahead

President Obama and his advisers hope the healthcare overhaul will do two things. The first is to extend coverage to tens of millions of Americans who today lack health insurance. The second is to hold the line on rising health care costs. This article describes some hurdles to achieving those two goals. While you are enjoying a vacation this summer, hopefully you will have time to ponder the impacts Health Care Reform will have on you and your family.

By Eduardo Porter, NY Times

Like other big employers, in the mid-1990s Harvard University was struggling with the ballooning cost of providing health insurance.
It chose what was a novel solution for the time. It dropped its standard deal — a subsidy that rose in line with the price of the insurance policy — and switched some 10,000 workers on its payroll to a fixed subsidy that encouraged them to shop around for care.

For Harvard’s accountants, the change worked wonders. A study a couple of years later by David M. Cutler, a Harvard economist, and Sarah Reber, a Harvard graduate, concluded that competition among insurers cut the university’s health bill by 5 to 8 percent.
But not everybody was equally pleased. Families of workers who chose the Preferred Provider Organization offered by Blue Cross/Blue Shield — the most comprehensive plan, with lots of doctors and hospitals on its network — faced a $500-a-year jump in their out-of-pocket spending on health care.

Younger and healthier workers canceled their P.P.O. plans, enrolling in cheaper H.M.O. options or dropping Harvard insurance altogether. Left with a sicker patient base, the P.P.O. raised its premiums further, which prompted the next layer of relatively healthy customers to leave.
And so on. In 1997, Blue Cross/Blue Shield withdrew its P.P.O. from the market, making it a victim of what economists call the death spiral of adverse selection.

In a couple of months the nation is set to experience a similar shock on a very large scale: the greatest change in how Americans pay for health care since the advent of Medicare nearly half a century ago.

Come October, millions of uninsured people will be able to choose one of several health plans, offered at four different tiers of service and cost through new health exchanges coming onstream in every state.

Cheap “bronze” plans will shoulder some 60 percent of patients’ medical expenses. Pricey “platinum” plans will cover at least 90 percent. But insurers will not be allowed to exclude people with pre-existing conditions, or charge more for the sick, or put a lifetime cap on medical costs. Their policies will have to cover a minimum standard of medical care. And the government will subsidize those who cannot afford to buy the policies.

President Obama and his advisers hope the overhaul will do two things. The first is to extend coverage to tens of millions of Americans who today lack health insurance. The second is to hold the line on rising health care costs.

“Over time, success will depend on what happens to the cost curve,” Professor Cutler told me. “If we don’t bend the cost curve, everything will fail. The government won’t be able to afford it. Nobody will be able to afford it.”

In theory, the overhaul could meet both goals. Millions of new Americans armed with a subsidy and shopping among plans would bring consumer choice to bear, finally, on the health care industry. Insurers would compete to create policies that offered the most value for money, pressuring hospitals and doctors on behalf of all of us.

Yet despite the care the administration took in establishing incentives and safeguards, even some of Obamacare’s most committed backers are wondering whether the experiment will work as advertised — or, like Harvard’s P.P.O., go off the rails along the way.

Adverse selection is perhaps the direst threat. For Obamacare to work, millions of healthy, young, uninsured Americans must join a health plan to counterbalance the sicker millions who are most likely to buy insurance. Otherwise, health plans on the exchanges will have to raise premiums to shoulder the higher costs.

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