But then it occurred to us that the American people really do deserve a presidential address on ObamaCare. No, not as punishment for re-electing him, or at least not mainly for that purpose. Rather, because 2½ weeks after the launch of the "exchanges" that are supposed to be ObamaCare's operational centerpiece, it is clear to almost everyone that they are an administrative disaster. In this crisis, there is an opportunity: to recognize an impending economic and humanitarian disaster, and to act in time to avert or at least minimize it.
That requires a willingness to face reality and a capacity for leadership. So far Obama has shown little evidence of either. CNN reports that in an interview with an Iowa TV station Tuesday, the president said: "I am the first to acknowledge that the website that was supposed to do this all in a seamless way has had way more glitches than I think are acceptable."
Let's let longtime ObamaCare enthusiast and Journolist founder Ezra Klein answer that: "So far, the Affordable Care Act's launch has been a failure. Not 'troubled.' Not 'glitchy.' A failure." A language note: One suspects the ObamaCare debut will make it impossible for anyone ever again to use the word "glitches" unironically.
Yesterday Obama delivered remarks at the White House, in which he made only an oblique reference to ObamaCare: "You don't like a particular policy or a particular president, then argue for your position. Go out there and win an election. Push to change it. But don't break it. Don't break what our predecessors spent over two centuries building. That's not being faithful to what this country is about."
This is galling for multiple reasons. For one, he was lecturing members of Congress, every one of whom (with the exception of three appointed senators) holds his office by virtue of having won his most recent election. Granted, Obama won his too, but with the help of an abusive IRS. And the country now faces a crisis because in 2009 and 2010, when it came to health care, Obama and his fellow Democrats failed to act in accord with the advice he now dishes out: "Don't break it."
How serious a crisis? As Megan McArdle has warned, "if the exchanges don't get fixed soon, they could destroy Obamacare--and possibly, the rest of the private insurance market." The Wall Street Journal reports today that "insurers say the federal health-care marketplace is generating flawed data that is straining their ability to handle even the trickle of enrollees who have gotten through so far." Examples:
Scott & White Health Plan in Temple, Texas, has received 25 enrollees from the federally run exchange so far. "There are some missing data elements that are requiring a lot of research on our part," said Allan Einboden, the health plan's chief executive. "If we'd received 5,000 and they all had to be worked, that's a lot of extra administrative costs," said Mr. Einboden, who said he expects the problems to be fixed.
After realizing that some applications listed up to three spouses in a single family, Blue Cross & Blue Shield of Nebraska, which has about 50 health-law enrollees, had to "stop those enrollments from going through the automated process," said Matt Leonard, the insurer's sales manager. "It takes an automated process and turns it into a manual process," he said.
At Priority Health in Michigan, health-plan staff are calling new customers to confirm each of their "couple of dozen" enrollees accurately picked the plan, said Joan Budden, chief marketing officer, after realizing some had enrolled in multiple health plans, likely owing to user error linked to slow healthcare.gov response times. "Sometimes they pushed the [submit] button three times," Ms. Budden said.
Sioux Falls, S.D.,-based Avera Health Plans has called each of its 21 incoming customers to make sure the data are correct.The heart may not bleed for insurance executives burdened with administrative costs, but this is actually a serious threat to the ability of Americans to get insurance. Under a provision of ObamaCare known as the "Medical Loss Ratio," insurers in the individual marketplace are required to spend at least 80% of all premium dollars on medical care. If the exchanges are "fixed" so that many more faulty applications get through, the new administrative costs will have to come out of the insurance companies' bottom line, making it harder for them to stay in business.
The Journal article notes that the largely nonfunctional exchanges may also worsen the "adverse selection" problem that comes with redefining insurance as a redistributive scheme:
As consumers struggle to navigate healthcare.gov, some health-plan executives worry that only the sickest--those who most expect to need insurance--will persist in seeking coverage. If younger consumers who are on the fence about buying coverage find the process too onerous, insurers may end up with too few healthier members to offset the costs of less-healthy enrollees.It's not obvious, though, that functional exchanges would be less nightmarish in this regard than nonfunctional ones. After all, if no one could sign up, there would be no adverse-selection problem. If everyone could, the ratio of healthy people paying above-market premiums to sickly people paying below-market ones would perhaps be higher than it is now--but the overall scale of the problem would be far greater.
In any case, it doesn't seem as though a quick fix is in the offing. "The federal health care exchange was built using 10-year-old technology that may require constant fixes and updates for the next six months and the eventual overhaul of the entire system," reports USA Today:
"I have never seen a website--in the last five years--require you to delete the cache in an effort to resolve errors," said Dan Schuyler, a director at Leavitt Partners, a health care group [founded] by [the father of] former Health and Human Services secretary Mike Leavitt. "This is a very early Web 1.0 type of fix."
"The application could be fundamentally flawed," said Jeff Kim, president of CDNetworks, a content-delivery network. "They may be using 1990s technology in 2.0 world."National Review Online's Yuval Levin repeats many of these themes in a lengthy and thoughtful overview based on not-for-attribution interviews with "several officials of the Center for Medicare and Medicaid Services (the HHS agency that is running the exchanges), and with a number of reasonably well placed insurance company officials in Washington." Although Levin is an opponent of ObamaCare, none of his sources are. Yet some of the stories they tell are so horrific, Levin doubts they are true:
The character of the conversations I had with these very knowledgeable individuals in the last few days reminded me of something: It reminded me of the daily intra-governmental video conferences and calls in the wake of hurricane Katrina in 2005. I was witness to many of those, as a White House staffer. What I saw in the first days of the disaster quickly fell into a pattern: local, state, and federal officials on the ground would report on what they knew directly--which was often grim--and then they would pass along information they'd heard but hadn't gotten first hand, which was often much more grim but almost always ultimately turned out not to be true. Some of these stories went public (remember the shootings at the Superdome? They never happened). Some didn't. They were often reported with a kind of detached authority that made them believable, and they were a function of living in panic amid an unbelievable situation over time.Reassuring, isn't it? The whole piece is worth a read, but here's the conclusion:
For me, and for other critics of Obamacare, the problem with the law was never about these technical matters. I didn't think the system wouldn't work because the government couldn't build a website, but because the basic health economics involved is deeply misguided and would take the (badly inadequate) American health-financing system in the wrong direction. So these problems only seem like a prelude to other, larger problems. But Obamacare was also always going to be a test of the sheer capacity of the administrative state to actually do what it claims the authority and ability to do. At this point, it looks as though we may be witnessing a failure of the administrative state on a level unimagined even by its staunchest critics. We may be. But we'll have to see.If we can't be sure of the magnitude or details of the disaster that is ObamaCare, it is in substantial part because the administration is stonewalling. USA Today quotes Kathleen Sebelius, secretary of health and human services, as saying Wednesday: "I will be the first to tell you that the website launch was rockier than we wanted it to be." Note the similarity to the shifty language of Obama's Tuesday quote: "I will be the first to acknowledge . . ." Both claim to be "the first" to say things everyone knew two weeks earlier and are grossly understating what everyone now knows.
The House Energy and Commerce Committee plans a hearing next Thursday on the exchanges' failures, but Politico reports Sebelius has declined to testify and HHS "has not committed to sending any other officials." Jon Stewart, by contrast, didn't need a subpoena to get her on his show.
Meanwhile, government and industry insiders with knowledge of the fiasco are intimidated from talking to the press, according to multiple reports. The Journal reports that HHS officials "have pressured insurers to refrain from commenting publicly about the problems, according to executives at four health plans, who asked not to be named. The HHS declined to comment."
USA Today reports that John Engates, a technology executive, "said HHS has been opaque about the problems, and the tech industry doesn't know the extent of the issues. 'There's no secrets leaking out,' he said. 'I'm sure everyone's looking for something to change the direction of the conversation, but it's just not there.' " And Levin reports that in addition to his acquaintances, "I approached several additional people at CMS who politely declined to discuss the exchanges."
The Hill reports that "White House press secretary Jay Carney said Thursday that President Obama was seeking 'accountability' from federal employees working to fix glitches with the ObamaCare website." Carney added that "the president was 'not happy' with how the rollout had gone."
But it is not the job of federal employees to keep Barack Obama happy. It is the job of federal employees including Barack Obama to be accountable to the people. This disastrous law was a product of Obama's willfulness. It is up to him to account for its results, and to devise a plan to minimize the damage. So far there is no indication he is even making an effort.