December 19, 2013

MEGAN MCARDLE: More Obamacare Delays. Surprised?

Last week, the Barack Obama administration asked health insurers to allow “retroactive payment” for policies that begin Jan. 1. The move was widely seen as a response to the problems the exchanges have been having. With millions of current policies being canceled, the administration understandably wants to minimize the possibility that people will be left uninsured because of a paperwork error.

This week, Reuters reported that insurers are a little worried about the possibility that people will game the system: have a bad emergency room visit on Jan. 3, pay for their insurance Jan. 4. Unsurprisingly, I’ve seen this popping up here and there in the conservative media world. Is this yet another unfolding Obamacare disaster?

Related: Is Obamacare Really an Improvement on the Status Quo?

“So far, at least 4.8 million Americans have received insurance cancellations notices, but Laszewski predicts that the total Obamacare enrollment will be less than half that number on January 1.

“‘My guess is that we’ll have somewhere around a million and a half people signed up for Obamacare on January 1 in the states and in healthcare.gov,’ he says. The big question then, he adds, is ‘why have we gone through this whole dislocation of the American health insurance system if only a million and a half to two million buy health insurance?’”

Maybe we’ll make up some of the gap with Medicaid. But at the current pace of enrollment, it would be a big hurdle to make up all the losses. Which means that we may well start the year with fewer people insured than we had in January 2013. There’s reason to think that that may be what the administration is seeing in the latest enrollment numbers.

One of the major defenses being offered for Obamacare — botched rollout and all — is that the status quo was so awful. Obamacare may have its issues, but at least it’s not the bad old days.

The problem with reformers is rarely that they’re wrong about the status quo; there are a lot of awful things in the world that could use fixing, and the reformers have usually correctly identified at least a few of them. The problem with radical reformers is that they tend to forget that things can get worse, as well as better.

If I’d sketched out the current scenario last summer — computer systems don’t work for months, millions lose insurance, and by the beginning of December, only 1.2 million people have picked up coverage from the exchanges and Medicare combined — the law’s supporters would have rolled their eyes and shaken their heads at the wishful thinking of the law’s critics. And now they generally assume that it will of course get better — that by March 31, if not sooner, we will see a measurable and substantial reduction in the number of uninsured.

But while that’s certainly very possible, it doesn’t exactly seem inevitable.

Based on experience to date, it doesn’t even seem especially likely. Then, of course, there’s the problem of whether people who are “covered” will be able to actually see doctors. . . .