Receive the Bulldog Edition


Economic Blogosphere

Economic Journalists


economicprincipals.com banner

September 29, 2013
David Warsh, Proprietor


| contents |

Creating a New Responsibility

Between the political posturing in Washington, and the excellent nuts-and-bolts reporting of the major news organizations, it is easy to lose sight of what is about happen on Tuesday.

When the Affordable Care Act takes effect, October 1, requiring most US citizens to obtain health insurance one way or another or pay a tax penalty for going without, a new obligation of citizenship will have been recognized by law.

The responsibility to take care of oneself will have been joined, however loosely, to the long-established right to emergency medical care.

Something like 25 million citizens, more than half of those who are currently uninsured, will enter into a relationship with a medical practice within the next few years. They’ll join more than 250 million Americans who are currently insured in the biggest undertaking to improve public health since the days of city sanitation and the war on communicable disease more than a century ago.

In many states, collective well-being will begin to improve almost immediately (the initial enrollment period extends through the end of March). In other states, especially those in the Southeast, where Republican governors have dug in against implementation of the law, a more complicated political game will play on. Everywhere, changes within the enormous health care sector, already underway, will gather momentum.

No wonder the fuss is so great.

At first glance, the statute bears a striking resemblance to mandatory vehicle insurance in the United States. Massachusetts led the way in broadening that market, too, followed closely by Connecticut. In 1925, the Commonwealth required automobile owners to get liability insurance in order to register their automobiles. New York followed suit, in 1956, and North Carolina, in 1957; other states quickly fell in line.  Today only Virginia requires no insurance; residents of the state must at least post a $500 bond instead, and an overwhelming majority purchase insurance.

Auto insurance is designed mainly to protect those who may be injured in an accident. Health insurance protects only the injured self. The Affordable Care Act was designed to address two separate problems that arise.  It opens the market  to those who were previously excluded by some pre-existing condition insurers deemed might make their care more expensive; and it seeks to bring into the market (those tax penalties) those who previously did without insurance either because they felt impervious (healthy young adults); or because they rely on emergency rooms from which they are rarely turned away and are expensively treated (the poor and/or the heedless). Smokers, drinkers and heavy eaters don’t see a doctor for forty years and then turn up on Medicare to be treated for cancer, heart disease, diabetes and hypertension.

Take Kentucky. Gov. Steve Beshear, a Democrat, last week took to the op-ed page of The New York Times to explain why his state was moving more quickly than almost any other state to implement the Affordable Care Act.  Some 640,000 Kentuckians are currently uninsured – one in six, he wrote.

They roll the dice and pray they don’t get sick.  They choose between food and medicine.  They ignore checkups that would catch serious conditions early. They put off doctor’s appointments hoping a condition turns out to be nothing. And they live knowing that bankruptcy is just one bad diagnosis away.

Half of them – mostly the working poor – will be covered when Medicaid eligibility is increased to 138 percent of the federal poverty level.  The other half will be able to purchase insurance, often at a discount, on the state’s Health Benefit exchange.

Kentucky’s two high-profile senators, Mitch McConnell and Rand Paul, are seeking to turn the ACA (Obamacare) into a referendum on the president, Beshear wrote.  But, he said, Republican governors in other states – including Jan Brewer, of Arizona; John Kasich, of Ohio; and Rick Snyder, of Michigan – were looking for ways to turn the ACA to their citizens’ advantage without fully embracing it.

It is this aspect of things that satirist Andy Borowitz  was getting at when he circulated the following send-up. (Borowitz, who is syndicated by The New Yorker, scores a direct hit often enough that I have his items sent to my inbox.)

NEW YORK (The Borowitz Report)—In a blockbuster documentary to be broadcast tonight, the Fox News Channel alleges that Obamacare is “little more than a thinly veiled scheme to force Americans to live longer.”

The documentary, called “The Ugly Truth About Obamacare,” claims that President Obama “is cynically using the health-care law to achieve his true objective: raising the life expectancy of Americans without their consent.”

“In America, how long you live has always been your own business,” says the documentary’s narrator, Sean Hannity. “Under Obamacare, though, it’s the government’s business—a government that wants you to live as long as humanly possible.”

The documentary lays out a nightmare scenario of Americans being saddled with sky-high life expectancies for years to come.

In perhaps the most chilling prediction of the documentary, Mr. Hannity warns, “If Obamacare goes into effect, Americans will be forced to live as long as people in Finland, Denmark, and other socialist countries.”

Speaking with reporters today, Mr. Hannity said he hoped that the documentary would be a “wake-up call about the secret agenda behind Obamacare.”

“President Obama is playing God with American lives,” Mr. Hannity said. “And if he stubbornly insists on making those lives longer, that could be grounds for impeachment.”

On Tuesday the Affordable Care Act goes into effect. It was passed by the Congress and upheld by the Supreme Court.  The White House holds all the cards. The Defunders, the operating arm of the Tea Party in Congress, are certain to lose if the president remains firm. He should simply state:  you don’t negotiate with terrorists.

As if to underscore the point, Senator Tom Coburn (R-Oklahoma), a veteran of the government shutdowns of 1995-96, told Politico last week that if If the Republicans succeed in shutting down the government Tuesday, “they’ll fold like hotcakes” after a week or two, when constituents begin to complain about the lack of service. “You do not take a hostage you are not going to for sure shoot. And we will not for sure shoot this hostage.”

And in the longer term?  My guess is that Tea Party dissidents will lose ground in  the midterm elections next year; that the GOP will split in the 2016 campaign and that a Democrat will be elected president; that in 2018 the Tea Party will further fade. And by 2020, the Republican governors who are successful in implementing the Affordable Health Care Act will be running for president, strongly, on the strength of their records.

| contents |

3 Comments

  1. karl eschelbach wrote:

    spot on. I am surprised that more commentators don’t use MassCare as a reference point. It seems to be working given that 99% of Mass citizens are insured.

    One point needs to be made. The penalty is not punative, and unlike MassCare, absolutely unenforceable. The IRS will have no legal authority to enforce the penalty…so there is no penalty. Moreover, by paying it you get something in exchange,namely the right to buy insurance without regard to pre existing conditions. That’s a great deal even to Greg Manikow.

    Monday, September 30, 2013 at 8:15 pm | Permalink

  2. Scoots wrote:

    Great read.

    VA doesn’t legally require auto insurance? Mind blown.

    How about the whole [privledge not a right] argument for regulating driving? It makes sense and it’s hard to argue. How would it apply here?

    And how did those dudes from Kentucky plan on turning the ACA to their advantage without fully.embracing

    Thursday, October 3, 2013 at 4:48 am | Permalink

  3. Scoots wrote:

    it?

    I like Borowitzs satire. Interesting take.

    The closing prediction though? C’mon man…Who’s to say and why should you? Now you’re either exactly right or completely wrong!

    Ballsy. I like it and I’ll send this to others.

    Thanks for the contribution – much appreciated! Continue the good work!

    Thursday, October 3, 2013 at 4:55 am | Permalink

One Trackback/Pingback

  1. ‘Creating a New Responsibility’ | The Penn Ave Post on Sunday, September 29, 2013 at 9:18 pm

    […] at 5:17 on September 29, 2013 by Mark Thoma David Warsh: Creating a New Responsibility: Between the political posturing in Washington, and the excellent nuts-and-bolts reporting of the […]

Post a Comment

Your email is never published nor shared.
Required fields are marked *

*
*


Skim past columns here.


Support Economic Principals by subscribing to its bulldog edition—receive the weekly via email a day before it is posted on the Web, and, as well, a quarterly Report to Subscribers.

To reach the proprietor, ask a question about the website or report a problem email warsh@economicprincipals.com.