Posts Tagged ‘Paul Krugman’

New Massachusetts Polling Data: What’s the Lesson?

December 22, 2009

Paul Krugman doesn’t like the Rasmussen poll on the popularity of health reform in Massachusetts.  I’ve cited that poll in the past, so I have an obligation to present contradictory information.  Besides, when Krugman talks, I listen.  Since many people consider the reform we’re likely to get similar to that which was enacted in that state, it’s an important issue.

Krugman cites the Boston Globe/Harvard School of Public Health poll and finds this to be its essential conclusion:  ” 79 percent want (reform) to continue.”  That’s much stronger than the tepid support in the Rasmussen bill, and it’s important.

I had a somewhat different interpretation, however, when I read the write-up in the Globe that Prof. Krugman cites.  “79 percent of those surveyed wanted the law to continue,” the article says, “though a majority said there should be some changes, with cost reductions cited as the single most important change that needs to be made.”

Then there’s this:  “In another question, residents were nearly evenly split over whether Massachusetts could afford to continue with the law as it stands: 43 percent said the state could not, and 40 percent said it could.

Lastly, the money quote (literally):  “A national survey by Kaiser released this month found that Massachusetts has the most expensive family health insurance premiums in the country, averaging $13,788 in 2008.”

Some of us knew that already, but it’s important to repeat it in this context.

Granted, the Senate bill has more cost containment in it that the original Massachusetts bill, especially in the latest draft (and thanks in part to progressive opposition to the bill, in my opinion.)  But I still think it’s weak on cost controls, and that many people are wildly overestimating the effect of those that it does contain.  But it’s worth noting that many of the bill’s proponents have been touting the idea that mandates themselves will help keep premiums under control.  I think that argument has been seriously undercut by results in Massachusetts.

Health Mandates: A Talk With Obama Health Advisor David Cutler

December 1, 2007

Hillary Clinton, John Edwards, and Barack Obama have each presented detailed proposals for health reform. The Clinton and Edwards plans include health mandates, which require Americans to obtain health care coverage or face (unspecified) sanctions. The Obama plan does not include mandates.

Health mandates are popular among many Democratic-leaning health policy analysts. The Clinton campaign has been going after Obama aggressively on this issue. They’ve said that the absence of mandates is a basic flaw in Obama’s plan; suggested a cynical political calculus behind Obama’s position said that his position feeds a Republican narrative; and took the position that Obama’s plan is politically vulnerable while theirs (and Edwards’) is a political plus in the general election.

(The preceding positions were echoed today by Paul Krugman – see my response, “Why Paul Krugman Is Wrong …“)

I don’t support any Democratic candidate, but I do have strong opinions about health mandates. As a long-time healthcare policy analyst and health manager in the private sector, I disagree with Paul Krugman, Ezra Klein, Jacob Hacker, and others who support mandates. My differences are based on policy effectiveness, issues of fairness, and Democratic political strategy. I think mandates pose more problems than they solve, and that they could be a political loser for Democrats in the general election.

I’ve been engaged in a collegial debate with Klein, blogger/consultant Joe Paduda and others on this topic for some time (see, for example, here, here, here, and here). During an exchange with Klein over the last week it became apparent that, while I had reasons to support Obama’s policy, it was unclear to me what his team’s current thinking was on the topic.

The team published a rebuttal to Clinton’s campaign late today. Earlier I spoke with David Cutler about mandates. Cutler is Professor of Applied Economics at Harvard, Obama’s senior health advisor, and the principal architect of the Obama plan.
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Why Paul Krugman Is Wrong About Health Mandates

December 1, 2007

Now there’s an intimidating headline to write. Paul Krugman slammed Barack Obama today on the issue of health mandates. Here’s why I believe he’s wrong:

From the beginning, advocates of universal health care were troubled by the incompleteness of Barack Obama’s plan, which unlike those of his Democratic rivals wouldn’t cover everyone.

Two misstatements in this opening sentence. First, while it’s true that Obama’s plan won’t “cover everyone,” neither will anyone else’s. Mandates have never achieved 100% effectiveness. The practical design problems of subsidies, exemptions, and benefit levels that accompany mandates are complex and unwieldy.  That’s why the Massachusetts Authority responsible for that state’s plan – which Krugman would describe as “covering everyone” – just exempted an estimated 20% of uninsured residents from the mandate.

Secondly, the absence of mandates is not necessarily an incompleteness in the Obama plan. I’ll be posting my conversation on this topic with Obama health advisor David Cutler shortly.

Here’s why: under the Obama plan, as it now stands, healthy people could choose not to buy insurance — then sign up for it if they developed health problems later. Insurance companies couldn’t turn them away, because Mr. Obama’s plan, like those of his rivals, requires that insurers offer the same policy to everyone.

As a result, people who did the right thing and bought insurance when they were healthy would end up subsidizing those who didn’t sign up for insurance until or unless they needed medical care.

Mr. Krugman raises some valid concerns here. But what he doesn’t say is that this would only be a temporary problem under the Obama plan. If it failed to achieve enrollment rates high enough to offset this ‘selection effort,’ other measures would be used – including potentially mandates.

The main difference between Obama’s plan and his rivals’ is this: They would mandate health coverage first and fix cost problems later. Obama would do the opposite. While both approaches are problematic, there is a strong case to be made that Obama’s plan is fairer – and much more politically progressive.

Mr. Obama claims that mandates won’t work, pointing out that many people don’t have car insurance despite state requirements that all drivers be insured. Um, is he saying that states shouldn’t require that drivers have insurance? If not, what’s his point?

His point is that the Clinton and Edwards claim – that they provide “universal coverage” – is false. If mandates don’t result in “universal coverage” – and the Massachusetts experience seems to confirm that – than this statement is hyperbole, not fact, and the debate is really about how many people to cover and how fast .  It’s not the black-and-white issue the campaigns are making it out to be.

Mr. Obama accuses his rivals of not explaining how they would enforce mandates, and suggests that the mandate would require some kind of nasty, punitive enforcement: “Their essential argument,” he says, “is the only way to get everybody covered is if the government forces you to buy health insurance. If you don’t buy it, then you’ll be penalized in some way.”

Well, John Edwards has just called Mr. Obama’s bluff, by proposing that individuals be required to show proof of insurance when filing income taxes or receiving health care. If they don’t have insurance, they won’t be penalized — they’ll be automatically enrolled in an insurance plan.

That’s a “terrific idea” with no penalties, Mr. Krugman says. Okay, let’s amend Obama’s choice of words slightly: when people are enrolled in a plan automatically and then don’t pay the premiums they’ll be “penalized in some way.” That’s not hair-splitting – it’s a huge difference. If a family of four is enrolled in a health plan with $10,000 annual premiums, that’s a burden. What will happen if they don’t pay?

We’ll fix that with subsidies, says the mandate crowd. But how much will people actually pay? They’re not saying.

I recently castigated Mr. Obama for adopting right-wing talking points about a Social Security “crisis.” Now he’s echoing right-wing talking points on health care.

I agree with Mr. Krugman about the Social Security issue. And I understand the concern about the use of words like “forced” by the Obama campaign. I understand the concern about the use of words like “forced” by the Obama campaign.  But that’s mild compared to the words the GOP will use in 2008 – and they’ll say them no matter what Obama does or doesn’t do. So rather than crying “foul” when someone challenges them, the Clinton campaign and others should use this as an opportunity to sharpen their talking points – or primary voters may conclude they don’t have it in them to make their case when the going gets tough.

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