The moment the Congressional Budget Office released its score of the Obamacare repeal bill passed recently by the house, hysterical partisan voices began their hue and cry. Under this baneful new reform, headlines wailed, "23 million would lose health coverage."
That isn't actually what the nonpartisan CBO's report said. But politicians and activists know a powerful rhetorical point when they see it. And there's great danger when such a potent point can be made that all resolve to do something necessary will collapse into a puddle of political cowardice.
Lawmakers should not allow alarmism to distract their attention. Obamacare is shredding the individual insurance market, as the flight of insurers from its exchanges illustrates. Just as Republican members of Congress are likely to take a hit politically for whatever they end up passing, so they are certain to take the blame and a bigger hit if they timidly back away and allow this appalling law to keep crippling the nation's healthcare system.
CBO does not have a crystal ball. Its estimates on Obamacare have a poor record. The CBO did not foresee the 105 percent average increase in premiums since the law went into effect. In 2013, CBO overestimated, by a staggering 16 million, the number of people who would sign up for Obamacare exchange plans by 2017. Its margin of error was much bigger than the total 10 million who have enrolled.
CBO also dramatically underestimated the costs of Obamacare's Medicaid expansion. It projected that insurers in the exchanges would make huge excess profits, creating an $8 billion surplus for Obamacare's "risk corridor" program. In fact, the program ran a deficit of nearly $8.3 billion in just its first two years as most big insurers suffered massive losses. These continue and are driving insurers out of the market.
Yet even assuming CBO's estimates as fact, those cherry-picking the numbers for their talking points are not giving the appropriate caveats that CBO provides. For example, this week's forecast does not say repeal will take away health insurance from 23 million people, or that 23 million will "lose" coverage. Some of that 23 million comes from CBO's assumption (probably dubious) that if Obamacare is not repealed, additional states will expand Medicaid, adding millions of people to the program who had never been on it. Others within that 23 million only bought plans to avoid paying a penalty and will drop their insurance the moment the law no longer requires it.
Beyond any of that, measuring the health of America's healthcare system, which is the goal lawmakers should keep their eyes on, is a lot more complicated than superficially focusing on how many people can say they pay every month for an insurance policy or are enrolled in a government program. That number doesn't account for the quality of their insurance, the value of the care available to them or their level of satisfaction with what they have or could have otherwise.
Many Obamacare customers are paying hundreds of dollars every month for plans that won't spring for anything short of a major health crisis. Their deductibles are too high, thanks to insurers' efforts to comply with Obamacare's expensive coverage mandates while still keeping premiums below the level of most people's rent payments. For the same reason, others face months-long waits to see a doctor because insurers cut costs by excluding so many providers from their networks.
Even the connection between coverage and health outcomes is controversial. A famous study of Oregon's Medicaid program, which covers the healthcare of poor people who pay none of the costs themselves, found that the program increased the use of medical services, especially emergency room visits, without improving health outcomes significantly.
A comparison of the future with and without Obamacare is bogus because it involves willful delusion to assume Obamacare for years will do what it is supposed to do in theory when, in practice, it is already manifestly failing to do those things. Insurers are fleeing the market. Another did so this week from Kansas and Missouri. It's absurd to base any score on the notion that people will get insurance for the next 10 years when in truth many regions will effectively experience de facto repeal because there will be no exchange plans available for purchase.
Healthcare is fantastically complicated. Actuaries at CBO are not well-equipped, let alone even allowed by their rules, to provide a clear picture of what a bill such as the American Health Care Act is going to do or how it will affect health. In broad strokes, they may be correct to think that it will bring down premiums, save taxpayers some money and result in fewer people having insurance than if Obamacare were left undisturbed.
But there are trade-offs either way. It would be both immoral and incorrect if lawmakers let the system continue to collapse like a row of dominoes in the mistaken hope of avoiding blame for whatever happens in the future.