Tag: oregon health insurance experiment

Obamacare Increases Man’s Premiums 300%, Supporters Call It a Success Story

Obamacare’s health insurance Exchanges opened for business, in most states, sort of, on Tuesday. Millions of people have reportedly flooded the Exchanges, but have had so much difficulty using the web sites that reporters have had a hard time finding anyone who has successfully enrolled in an Obamacare plan. The Washington Post’s Sarah Kliff writes:

Just moments after writing a blog post Thursday morning, about the lack of information on Obamacare enrollees, Enroll America reached out with contact information for Chad Henderson, a 21-year-old in Georgia who had successfully enrolled in coverage on the federal marketplace.

Chad is evidently a scarce commodity.

It was a little difficult to reach Henderson, mostly because so many other reporters wanted to talk to him. “I’m supposed to talk to the Chattanooga Times Free Press in a half hour,” Henderson said. “And The Wall Street Journal is supposed to call.”

Luckily, Henderson managed to squeeze me in for a few minutes.

Kliff reports that after a three-hour ordeal, Chad bought an Obamacare plan that cost him $175 per month – pretty steep, considering he makes less than $11,500 per year. His Obamacare premium comes to least 18 percent of his income. And no, Chad is not eligible for subsidies.

Compare that to what Chad could have paid if he bought one of the pre-Obamacare plans still available on eHealthInsurance.com until December 31. The cheapest such plan for someone meeting Chad’s profile is just $44.72 – as little as 5 percent of his annual income and about one-quarter of his Obamacare premium.

I can’t yet say whether Chad’s $175 premium is the lowest-cost plan available to him through the Exchange. (I’m in the process of researching that. Let’s just say it’ll probably take a few hours.) But it’s probably close. The cheapest plan available to him through eHealthInsurance.com after Obamacare’s community-rating price controls take effect in 2014, and drive up premiums for young, healthy people market-wide, is $190.23. That’s with the maximum cost-sharing allowed under Obamacare. So it appears Obamacare quadrupled Chad’s premiums, and Enroll America thinks that is a success story.

To me, the most interesting part is that Chad didn’t buy health insurance when it was available to him for just $45 per month, but did buy it at an unsubsidized $175/month premium. Why? Again, Kliff:

He describes himself as a supporter of President Obama who has anxiously awaited Obamacare’s rollout…

Part of his decision was ideological: He wants the health-care law to succeed.

Oregon Libertarians to Obamacare: Don’t Fence Me In

Ben Nanke, a 20-year-old aspiring songwriter and filmmaker from Salem” was none-too-pleased to see the glossy odes to Obamacare that will run in Oregon at a cost to taxpayers of some $9.9 million. Who can blame him? The videos claim Obamacare will make you healthier and live longer, even though there is zero reliable evidence that’s the case, and much evidence to suggest it won’t. Also, that had better be his own guitar that Matt Sheehy is getting wet.

 So the libertarian Nanke and his friends composed and cut a video for “Don’t Fence Me In,” their own love letter to Oregon, and freedom. Here’s what Nanke wrote at the video’s YouTube page:

As native Oregonians, we found it strange that a large-scale, federally-funded ad campaign is trying to twist the meaning of “the Oregon Spirit.”

Quoting the Oregonian - “Mark Ray, co-owner and creative director of North [who created the ad campaign], said the initial ads are to ‘create almost a hello’ sort of vibe, while stressing an ‘Oregon pride, Oregonians take care of themselves kind of thing.’”

We agree, and believe that “Oregonians take care of themselves” means exactly that. We take care of ourselves. No government mandates, no tax penalties, and no manufactured marketplaces. We love seeing our fellow Oregonians happy, healthy, and strong, which is why we don’t want to see our state fenced in by government-controlled health care.

A sampling of the lyrics, and the full video follow.

Long ago the wagons traveled past the cliffs of the Gorge

We watched the sagebrush trails become I-84

It’s not that I don’t care, it’s that I’ve seen it before

We say “oh, don’t fence me in.”

You say, “ooh, it looks mighty innocent”

but follow the trail, you know it’s gonna derail

I say “ooh, we’re all going to pay for this”

We’ve travelled quite a long road, and we know where this goes

You say it’s time for a change from the Oregon range

Rugged individuality gives way to rain and trees

So don’t tell the people of Oregon that we don’t care

Don’t fence me in. (Don’t fence me in)

NYT Room for Debate: the Oregon Medicaid Study & ObamaCare

Today’s New York Times Room for Debate” feature poses the question, “Do the mixed results of an Oregon health care study show that government medical insurance should provide only catastrophic coverage?” From my contribution:

ObamaCare aims to cover 16 million poor uninsured adults through Medicaid, plus 16 million higher-income uninsured Americans through government-subsidized “private” insurance. Supporters portrayed these “reforms” as a matter of life and death, particularly for the poor. Yet a monumental new study finds that “Medicaid coverage generated no significant improvements in measured physical health outcomes” for poor adults. These findings strengthen the case that states should stop implementing ObamaCare, and Congress should swiftly repeal it…

The absence of physical-health improvements indicts the entire enterprise. Supporters have an obligation to show that the $2 trillion in entitlements ObamaCare will launch next year would actually improve enrollees’ health. The Oregon study shows they cannot meet their burden of proof. What part of “no discernible improvement” don’t they understand?

Read the whole thing here. See also the contributions by Drew Altman, Austin Frakt, Robert Reich, and Grace-Marie Turner.

A Question for Medicaid Deniers

A lot of people are writing about the Oregon Health Insurance Experiment results, released yesterday, which found zero evidence that expanding Medicaid to the most vulnerable people targeted by ObamaCare’s Medicaid expansion improves their physical health. Here’s my take on the study and its implications. Megan McArdle, Shikha Dalmia, Avik Roy, and Peter Suderman are making solid contributions to the debate. Zeke Emanuel gets points for making an admission against interest (“It’s disappointing”). Points also to Jennifer Rubin for her take on what the OHIE says about ObamaCare’s Medicaid expansion: “If there had been a giant trial of a heart medication with lousy results we wouldn’t proceed in mass-marketing the drug; we might even take it off the shelves.” Not a bad idea. Ezra Klein and Evan Soltas call for more such experiments. Yes! Let’s have more randomized, controlled trials of the effects of Medicaid, on pre-ObamaCare populations, in big states like California, New York, Texas, Florida, and Illinois, where we can harnass even more statistical power. The only unethical thing would be to keep spending trillions on this program without knowing whether it’s even effective (much less cost-effective).

Others are making less-solid contributions. Here’s a question for them.

Since the OHIE shows that Medicaid makes no difference in the diagnosis or use of medication to treat high blood pressure or high cholesterol, and has no effect on blood-sugar levels despite increasing diabetes diagnoses and medication use, would you support eliminating Medicaid coverage for these screenings and medications?

If not, why not?

Oregon Study Throws a Stop Sign in Front of ObamaCare’s Medicaid Expansion

Today, the nation’s top health economists released a study that throws a huge “STOP” sign in front of ObamaCare’s Medicaid expansion.

The Oregon Health Insurance Experiment, or OHIE, may be the most important study ever conducted on health insurance. Oregon officials randomly assigned thousands of low-income Medicaid applicants – basically, the most vulnerable portion of the group that would receive coverage under ObamaCare’s Medicaid expansion – either to receive Medicaid coverage, or nothing. Health economists then compared the people who got Medicaid to the people who didn’t. The OHIE is the only randomized, controlled study ever conducted on the effects of having health insurance versus no health insurance. Randomized, controlled studies are the gold standard of such research.

Consistent with lackluster results from the first year, the OHIE’s second-year results found no evidence that Medicaid improves the physical health of enrollees. There were some modest improvements in depression and financial strain–but it is likely those gains could be achieved at a much lower cost than through an extremely expensive program like Medicaid. Here are the study’s results and conclusions:

We found no significant effect of Medicaid coverage on the prevalence or diagnosis of hypertension or high cholesterol levels or on the use of medication for these conditions. Medicaid coverage significantly increased the probability of a diagnosis of diabetes and the use of diabetes medication, but we observed no significant effect on average glycated hemoglobin levels or on the percentage of participants with levels of 6.5% or higher. Medicaid coverage decreased the probability of a positive screening for depression [by 30 percent], increased the use of many preventive services, and nearly eliminated catastrophic out-of-pocket medical expenditures…

This randomized, controlled study showed that Medicaid coverage generated no significant improvements in measured physical health outcomes in the first 2 years, but it did increase use of health care services, raise rates of diabetes detection and management, lower rates of depression, and reduce financial strain.

As one of the study’s authors explained to me, it did not find any effect on mortality because the sample size is too small. Mortality rates among the targeted population – able-bodied adults 19-64 below 100 percent of poverty who aren’t already eligible for government health insurance programs – are already very low. So even if expanding Medicaid reduces mortality among this group, and there is ample room for doubt, the effect would be so small that this study would be unable to detect it. That too is reason not to implement the Medicaid expansion. This is not a population that is going to start dying in droves if states decline to participate.

There is no way to spin these results as anything but a rebuke to those who are pushing states to expand Medicaid. The Obama administration has been trying to convince states to throw more than a trillion additional taxpayer dollars at Medicaid by participating in the expansion, when the best-designed research available cannot find any evidence that it improves the physical health of enrollees. The OHIE even studied the most vulnerable part of the Medicaid-expansion population – those below 100 percent of the federal poverty level – yet still found no improvements in physical health.

If Medicaid partisans are still determined to do something, the only responsible route is to launch similar experiments in other states, with an even larger sample size, to determine if there is anything the OHIE might have missed. Or they could design smaller, lower-cost, more targeted efforts to reduce depression and financial strain among the poor. (I propose deregulating health care.) This study shows there is absolutely no warrant to expand Medicaid at all.

ObamaCare’s Priceless Warm Glow

Ed Kilgore says ObamaCare opponents don’t care about cost-benefit analyses:

many of them just can’t bring themselves to even notice that…Obamacare with its Medicaid expansion, health care exchanges, and regulatory mandates [does] actually provide health coverage to people in exchange for the money and the “liberty” surrendered.

Speaking of, what is the exchange rate between liberty and “liberty”?

But about those benefits. What benefits do broad-based expansions of health insurance, like ObamaCare, actually provide? Aside from giving Kilgore a warm glow, that is.

It turns out there has been only one—one!—scientifically rigorous study of that question. The Oregon Health Insurance Experiment found Medicaid coverage confers modest improvements in self-reported health and financial security. The first batch of that study’s results appeared more than a year after Congress enacted ObamaCare. And there remains to this day absolutely zero evidence that Medicaid or other broad-based expansions of health insurance buy us the most health and financial security per dollar spent.

Then again, the Oregon Health Insurance Experiment did not attempt to measure the value of the warm glow that Kilgore and others derive from Medicaid and ObamaCare, one that appears to be worth trillions of dollars of other people’s money.

ObamaCare Supporters Are Over-Interpreting Oregon Medicaid Study

Columbia Business School economist Ray Fisman has a piece at Slate.com discussing the first-year results of the Oregon Health Insurance Experiment.  In brief, when Oregon transferred an average of $3,000 from taxpayers to poor people in the form of Medicaid coverage, it did those poor people some good.

Fisman’s interpretation of the results is different from mine in mainly two respects.  First, I describe the one-year benefits of Medicaid coverage as modest; he says they’re “enormous.”

A more fundamental difference concerns whether expanding Medicaid was a cost-effective use of the taxpayers’ money.  Fisman writes:

Given the added expense, did the Medicaid expansion prove to be cost-effective? That is, did the treatment group actually have better health outcomes?

That’s not what cost-effectiveness means.  For Medicaid to be cost-effective, it must (A) produce benefits and (B) do so at the same or a lower cost than the alternatives.

The OHIE establishes only that there are some (modest) benefits to expanding Medicaid (to poor people) (after one year).  It tells us next to nothing about the costs of producing those benefits, which include not just the transfers from taxpayers but also any behavioral changes on the part of Medicaid enrollees, such as reductions in work effort or asset accumulation induced by this means-tested program.  Nor does it tell us anything about the costs and benefits of alternative policies.

Just as some opponents of ObamaCare over-interpreted previous Medicaid studies, Fisman and other ObamaCare supporters are over-interpreting the OHIE.