Ezekiel Emanuel, a former health-care adviser to President Obama and brother of Chicago Mayor RahmEmanuel, spills the beans in WSJ (my highlights):
In less than five months, on Oct. 1, the Affordable Care Act's insurance exchanges will go live online. Millions of Americans will suddenly be able to log on to a website and choose their own heath-care coverage from a menu of subsidized options for prices and coverage levels. As the opening day gets closer, anxiety is increasing over how well these online exchanges will function.Then Emanuel gets to an even bigger part of the nightmare:
Seventeen states and the District of Columbia are operating their own exchanges, seven states are operating exchanges in partnership with the federal government, and the federal government is running exchanges for the remaining 26 states that opted not to create their own. All are rushing to ensure that their systems get up and running on time, and nobody is forecasting a glitch-free rollout, not even the president. Transforming the U.S. health-care system—which is larger than the economy of France—is one of the most daunting administrative tasks government has ever confronted. There will be bumps in the road; this is inevitable.
Setting up the exchanges will pose a host of technological challenges, such as digitally linking an individual's IRS information (which determines a subsidy level) to the insurance offerings in the individual's home area and to employment data—while simultaneously factoring in Medicaid eligibility.
Bugs in the computer software are bound to pop up, and the quality of the user experience will undoubtedly need improvement[...] glitches will be ironed out within a few years, and certainly by 2016 browsing your health-insurance exchange will be very much like browsing Amazon and other online shopping sites.
There is, however, one key aspect of the exchange rollout that needs more attention: enrollment. Government exchanges on a national scale have never been tried before. There is no history—except in Massachusetts—to suggest how many Americans will enroll and who they will be. This uncertainty could set off a negative reinforcing cycle that undermines the entire exchange system.
Here is the specific problem: Insurance companies worry that young people, especially young men, already think they are invincible, and they are bewildered about the health-care reform in general and exchanges in particular. They may tune out, forego purchasing health insurance and opt to pay a penalty instead when their taxes come due.
The consequence would be a disproportionate number of older and sicker people purchasing insurance, which will raise insurance premiums and, in turn, discourage more people from enrolling. This reluctance to enroll would damage a key aspect of reform.
Insurance companies are spooked by this possibility, so they are already raising premiums to protect themselves from potential losses. Yet this step can help create the very problem that they are trying to avoid. If premiums are high—or even just perceived to be high—young people will be more likely to avoid buying insurance, which could start the negative, downward spiral of exchanges full of the sick and elderly with not enough healthy people paying premiums.
What's really going on here is a program that attempts to suck in the youth to pay for the healthcare of the elderly. It's insane. On top of that, the first year penalty for not buying insurance is small ($95), so most young will opt out, meaning the revenue to support the structure will have to come from massive premium hikes paid by those older who opt to stay in the system. There is no other way out if Obamacare goes into affect. Well, there is one way out. According to Emanuel:
Fortunately, there are solutions. First, young people believe in President Obama. They overwhelmingly voted for him. He won by a 23% margin among voters 18-29—just the people who need to enroll. The president connects with young people, too, so he needs to use that bond and get out there to convince them to sign up for health insurance to help this central part of his legacy. Every commencement address by an administration official should encourage young graduates to get health insurance.
Oh yeah, youth who are now working at second tier jobs are going to fork over a part of their tiny pay to Obama to pay for his socialistic healthcare plan. Where do I buy a ticket to watch this happen?
But do get ready for a barrage of propaganda. Emanuel, again:
Finally, and most important, we should adopt some of Massachusetts' practices. When state officials in 2006-2007 were rolling out their exchange—called the Massachusetts Connector—they mounted a sustained campaign to encourage enrollment by young people. One aspect of the campaign focused in particular on young men, even heavily promoting the new exchange on TV during Red Sox games and hosting an annual "Health Connector Day" at Fenway Park.
Not only did the Massachusetts campaign help establish the norm—that everyone needs to have health insurance—it also promoted awareness around the subsidies and the affordable policies available. Within one year of implementation, the rate of uninsurance dropped by nearly two-thirds among 19-26 year olds, to 8.2% from 21%.
Now it is crunchtime for health-insurance exchanges. The Obama administration and state governments must have a robust plan to reach Americans—especially young people—through every media available, including but not limited to baseball games.
During the last election, President Obama showed that he could use data to identify and mobilize young people. Come the fall, he and his administration need to turn these skills to motivate young Americans to do more than vote—and get insurance. There is no time to lose. We need to educate Americans about what is coming.Clearly, the Obamacare designers are scared, as they should be, from bugs in computer programs to a cash flow model that won't work, these are going to be problems right out of the gate, only to be followed by problems with a socialistic structure that will distort allocation of healthcare and suffocate innovation and effort in the sector. Who needs Halloween, when we will have an early October Obamacare horror show?
Eat healthy and stay healthy, my friends.