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Obamacare Rollout: Will Insurers Be Hoist on the Enrollment Petard?

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The Wall Street Journal looks to have used an interview by Ezra Klein on Obamacare tech woes as the basis for a reported piece on how insurers were having so much trouble with the Federal marketplaces that they were having to check and in some cases process enrollments manually. That’s clearly unworkable at anything resembling the scale of expected participation. But not only does the Journal article corroborate and add more color to an ugly story, but it also mentions a different type of problem, that of eligibility, in passing. That’s actually a hugely important and presumably separate subroutine in the system, and if that is also broken or buggy, it has serious implications of its own. The Journal reporters appear not to have understood the significance of what they were told about eligibility, so they didn’t follow up on in their account, but we’ll point out what the consequences of glitches on this front might be.

Klein’s interview with Robert Laszewski of Health Policy and Strategy Associates described the problems he was hearing from insurance companies, and what that implied about the IT systems. The critical section:

The insurance industry is literally receiving a handful of new enrollments from the 36 Obama administration-run exchanges. It’s really 20 or 30 or 40 each day through last week. And a good share of those enrollments are problematic. One insurance company told me, “we got an enrollment from John Doe. Then five minutes later we got a message from CMS disenrolling him. Then we got another message re-enrolling him.” On and on, up to 10 times. So insurers aren’t really sure if the enrollments they’ve got are enrollments they should have.

And remember, the insurers have automated all this. They don’t have a clerk sending out a welcome letter and an enrollment card. So if you just let the computer run, it could theoretically issue a welcome letter, a cancellation letter, a welcome letter, a cancellation letter, etc. Now, they’re not doing this right now because it’s all screwed up. They can manage a few dozen per day by hand. But when you’re talking about thousands or tens of thousands or hundreds of thousands, it becomes completely unmanageable.

The Journal confirms this picture:

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, in a sign that technological problems extend further than the website traffic and software issues already identified.

Emerging errors include duplicate enrollments, spouses reported as children, missing data fields and suspect eligibility determinations, say executives at more than a dozen health plans. Blue Cross & Blue Shield of Nebraska said it had to hire temporary workers to contact new customers directly to resolve inaccuracies in submissions. Medical Mutual of Ohio said one customer had successfully signed up for three of its plans.

The flaws could do lasting damage to the law if customers are deterred from signing up or mistakenly believe they have obtained coverage.

The worst of these problems is that the insurer gets bad information. Some may be resolved when the IT glitches are cleaned up (one executive reports having enrollees show up with multiple spouses). But others may be due to problems with data integrity and database integration, and they are more difficult to remedy. Again from the Journal:

As more of those users attempted to sign up for plans this week, insurers began noticing problems with enrollment data. For now, they say they are largely able to manually correct the errors. But as enrollment increases—up to 7 million consumers are expected to sign up in the next 5½ months—that may not be possible, they worry.

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…

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.

Lambert jumped on the last issue:

You’ve seen this happen, every so often, on blogs like Corrente. I’m tellin’ ya, if somebody gave me a billion, or a million, or a hundred thousand, or a thousand, or a couple hundred bucks to stop double posting at Corrente, it woudn’t be happening. No matter how slow the site is (and Corrente is no speed demon).

So did all the programmers for the Federal Exchange take the brown acid? Was there a spec? Was there testing? This is just so bad!

Notice that for every insurer that the Journal contacted, the fix was a manual intervention or even an manual enrollment. Now some glitches may recur reliably so that the insurer can override or automate how it deals with them once it gains experience. But if this continues, and I can’t see how it can get much better unless the folks in the Administration admit what a mess this is, take the project off line, test and patch it up a ton and relaunch, we’re going to get an amusing side effect: the insurers will be hoist on their own petard.

Under the ACA, a stipulated percentage, 80%, of the insurance premiums are required to go to health care. That was presented as a boon to consumers (“health insurer profit margins are capped”) when it was intended to be a gimmie. Health insurers have been price gouging for decades. In the early 1990s, they spent 95% of health care premiums on medical expenditures. As of the passage of the ACA, it was down to under 85%. But if they get stuck with a lot of unexpected enrollment expenses, bye bye profit margins! Remember, the ACA, despite its billing, was designed to enrich the health insurers and Big Pharma. The insurers would gain more customers, both through the subsidies and fines inducing more customers to sign up for policies. So their top line would increase and they expected to have comparable, maybe even better profits on the new business (they are pushing more volume through largely existing infrastructure). But a boatload of extra up front costs will complicate this pretty picture.

Now of course, you might say, the solution for the insurers is simply not to help out the enrollees all that much. Just bounce all but the cleanest enrollments that get through and make it the Administration’s responsibility to deliver them decent data. But that intersects with another problem: the people who will absolutely insist on getting enrolled will be the sickest. That is the biggest nightmare in insurance, being stuck with the worst risks, or what is known as adverse selection. Thus the insurers need to get as many people through the process as possible and do what they can to minimize the pain for customers so that some of those young, healthy people they really wanted to get on their books do indeed sign up.

Let’s turn finally to the additional potential huge can of worms that the Journal tripped over but apparently did not probe. And credit to Lambert for catching it. Here’s the key sentence from the top of the second paragraph, emphasis ours:

Emerging errors include duplicate enrollments, spouses reported as children, missing data fields and suspect eligibility determinations, say executives at more than a dozen health plans.

Remember how Obamacare works. In an normal online shopping experience, you poke around a site or several sites, compare products and pricing, pick one and check out, which is when you provide payment information. The Obamacare system puts the payment part, which is eligiblity, up front, because it is eligibility for subsidies. They did not want people in income categories that would be eligible for subsidies first looking at plans and going, “OMG, that plan for our family will cost $1200 a month” when that was the pre-subisdy cost and they need to put their income parameters in to see what the net cost to them will be.

Remember, people below a certain income level are not eligible for Obamacare but instead shunted to Medicaid. If you are eligible for Obamacare, you get a subsidy if your income is below 400% of the poverty line, or $45,960 for an individual and $94,200 for a family of four. See here to see the various buckets of subsidies (scroll down to the table under “The Federal Poverty Guidelines Help to Determine Subsidies”).

Now it is possible that the “suspect eligibility determination” is due merely to determined shoppers managing to submit an enrollment prematurely while inputting approximate information that was too approximate. As Lambert wrote:

To calculate subsidies, the Exchange just needs some parameters or, in the vulgate, some boxes to fill in on the online form: Income, for example. Those parameters do not need to be validated — and it’s validation, not eligibility calculation, that is the cause of the bottleneck.* Just feed some fake parameters to the eligibility engine, and get back a number.

So some customers may think just like Lambert and are causing problems, which might point to other deficiencies (as in people may wind up submitting enrollments when they think they are just shopping, which could be the result of bad interface design).

But it could be that there is something more seriously wrong with the enrollment engine. It has to be fairly pronounced for the insurers to pick it up. How would insurers detect a “suspect eligibility determination”? Are they seeing enrollee’ estimated incomes? Why should that even be something the insurer is even aware of? You would assume the path is: Customer enters income and other eligibility information. HHS system slots individual/family into appropriate subsidy bucket. Consumer then pokes around among various plans and gets prices adjusted for his subsidy level. Customer ALSO gets to see whether he is eligible for “Advance Tax Credits” which means all he pays his insurer is that net price. When he files his tax return for the year, if his income on his tax return differs enough from what went in the enrollment form to put him in another bucket, he will have gotten too much or too little subsidy. That difference is applied to his taxes.

That’s a bit long-winded, but you can see where this is going. First, for insurers to detect eligibility issues, it would seem likely that they are getting the entire enrollment file, including the income information. I don’t like the idea of that from a privacy and security standpoint. Bad enough the NSA knows everything, now your insurer is in that loop too? Second, the errors have to be both pretty gross and reasonably frequent for the insurer to notice and be concerned about them (after all, in theory if the customer does not pay the rack rate, the Administration picks up the rest of the tab, so you would not expect them to be looking at this information all that closely).

Now the error could be a simple formula error that is dumping people into the wrong subsidy bucket. Gross errors like that would produce ugly results but would not be hard to fix. But if it’s not something like an easily-remedied computation mistake, the ramifications would be large. A big raison d’etre for Obamacare was the subsidies, both from the public’s and the insurers’ perspective. If that part of the software doesn’t work well, you have the prospect of consumers getting stuck with IRS bills that are wrong or unexpected (as in they provided the right information but the subsidy was calculated incorrectly). And where does the poor insured go then? HHS apparently will have an Obamacare ombudsman, but how much power will it have, and will that office have remotely the needed staffing to deal with this sort of mess?

While the discussion above may sound unduly pessimistic, Lambert’s big mistake on Obamacare so far has been in failing to anticipate that the start-up would be as horrifically screwed up as it has turned out to be. Based on results to date, the worst case scenario is likely to be the actual state of play. On the eligibility matter, we’ll see soon enough whether Obamacare’s Federal exchanges launch is continuing to run true to form.

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100 comments

  1. Massinissa

    Jesus lord mercy.

    Are there still people who think this crap is ‘better than nothing’? Because as bad as the previous status quo was, I think it was better than being forced by a large fee to sign up for a worthless system.

    1. Banger

      I agree, I think. Theoretically this was marginally better system if the system all worked flawlessly and the loopholes were minimal. I was convinced from talking to people in the system that without the ACA there was a lot of pressure within to initiate some reforms particularly in the cost area.

      The whole government IT problem is a weak link. It sounds like what we have here is combination of problems I’ve seen for a long time. Often people in government are making decisions about online applications without knowing the problems inherent in them–usually they create unrealistic specs that contractors then find ways to squeeze out more billable hours which in turn, makes for sloppy programming which turns to the deadline bug which means duct-tape techniques being applied to make the program work good-enough to get to the next stage of evaluation, meanwhile the underlying code becomes tangled with fixes that later will turn out to be bugs when large volumes of data start being generated so it has to be rewritten almost from scratch–these projects go on for years limping through somehow.

      1. different clue

        How was it better even theoretically? Given that the point of the plans was narrow little networks to deprive people of the best care when needed most, where is the improvement? Well . . . in the expanded medicaide eligibility for those states which accepted it. Otherwise, where?

        And this was never meant to be a “step toward single payer”. This was meant to be the maw waiting for when Obama’s successors are able to destroy Medicare completely,
        Ryanize and voucherise the remains, and send every Medicare tax/premium payer into the Forced Mandate exchanges. Part of the way to do that will be to lower Medicare payments to providers enough that no provider will accept a new Medicare patient ever again. Then the turned-away Medicare
        participants will be oh-so-graciously permitted to recieve little voucher payments to pay toward the Forced Mandate plans. That is Obama’s long range plan for Medicare.

  2. dearieme

    In the past I’ve said I wouldn’t have the cheek to recommend to Americans what they do about health care (save for the obvious “don’t copy the NHS”). But it had never occurred to me that they could come up with a wheeze that would make their position worse. Golly!

    1. human

      The NHS suffers from Western Capitalism Syndrome. It is micro-managed and purposely underfunded by captured politicians.

    2. Carla

      Omigod, as an American, I can only say “Copy the NHS! Copy the NHS.”

      Dearieme, I doubt you have any idea how bad it is here.

    3. Nathanael

      The NHS would be a godsend over here. You have no idea how bad it is. People go to Mexico to get treatment.

  3. Brooklin Bridge

    The NSA has some of the most sophisticated software in the world for spying on Obama detractors all over the world and, ahem, especially at home, and the ACA has software written by idiots using a 100 dollar lap top for a server?

    Sounds like Obama has his priorities in order. It also sounds like a totally corrupt administration is getting exactly what it is set up to get, garbage. Let’s see, it’s not quite, “a dollar for you and two for me.”, it’s more like “a billion for propaganda and a penny for software, another billion for propaganda and a penny for software, oh yes, another billion to intimidate media and another penny for software.”

    1. Banger

      First of all, Obama has no control over the NSA it is part of a the national security state that mainly runs on its own across administrations and has perennial universal bi-partisan support. The IT project that allows that institution to watch over everything we do has been a long-time coming and has almost unlimited funds and decades of development behind it.

      The ACA project obviously has been bungled and under-funded. Contractors who would have quaked in fear at even a thought of crossing the intel-community would have no trouble in ripping off this relatively weak administration or worse. Power matters in Washington–and contractors are very aware of where that power lies.

      1. Brooklin Bridge

        First of all, nonsense, Obama has little direct control over either the NSA or the specific contractors that work on the ACA. That doesn’t mean he has NO control over either. He does, and the continuation of those programs do indeed reflect his priorities. When he came into office during his first administration he also had enough wind at his back to make serious changes in the direction of the NSA that would have affected the level of funding for software development.

        Second, the ACA has had more than simply the last few months to get their act together and Obama could definitely have made it clear he wanted quality control and scalability to be significant parts of the effort. He HAS advisors. If the results described above are accurate, this definitely reflects Obama’s comparative lack of concern (priority) for that part of the ACA that helps people rather than his image. He didn’t just goof, he considered it beneath him. That’s a personal priority.

        Third, there are very few things the WH has direct control over but just as this post makes clear, that does not mean we are not seeing his priorities reflected in them, along with those of most of the elite in Washington.

        1. Brooklin Bridge

          Obama has no more control over the economy than he has over the NSA, yet we say the lack of jobs and the giveaways to big bankers reflect his priorities as illustrated by his refusal to push is DOJ or congress to hold any bankers accountable.

          The NSA is deeply involved in Drones, in ever increasing spying on citizens which to a large degree is supported by the hocus pocus of Obama’s shadowy legal team. All of those initiatives that we say started with Bush but continue and are increased under Obama are accomplished with SOFTWARE so it is almost absurd to say that software doesn’t reflect Obama’s priorities.

          Arguing that the NSA as well as its software was started long before Obama and therefore he has nothing to do with him is like saying the economy was started long before Obama and so has nothing to do with him.

      2. Brooklin Bridge

        Contractors who would have quaked in fear at even a thought of crossing the intel-community would have no trouble in ripping off this relatively weak administration or worse.

        You keep saying Obama and his administration are weak. Where do you get that from? Obama has been responsible for more neo liberal legislation than all six presidents since Tricky Dick combined. He has destroyed more civil rights. He has provided the insurance industry and Pharma and the whole relationship between industry and government in general with one of the first truly fascist laws on mandating fealty to private enterprise since the declaration of independence. He has put more legitimate whistle blowers in jail and exercised the espionage act of 1917 more than all other Presidents combined. He has preformed more acts of aggression on foreign countries with which we are not at war than all Presidents combined since Eisenhower. He has single handedly intimidated the whole industry of journalism at least as much if not more than any other president since the beginning of the last century.

        He is not a weak president and his administration is anything but weak, and any drone respecting, military tribunal fearful, verdict before trial sensible code-head that doesn’t want to find himself competing in the water boarding championships down in sunny Guantanamo Bay knows it.

        1. Banger

          My own observation is that there is a permanent government in Washington; sometimes there are Presidents who come from that world, like the Bushes, but the permanent government is always the senior partner and they set the agenda. Obama is weak because he is only a front man who was groomed to defuse the left and black people. He has no power base except those who recruited him. He has some leeway but not a whole lot and, in fact, no Prez has that much leeway if he is instituting repressive measures it is not his fault but the fact the left fell for the con he is part of because it was once the left that criticized the abuses of power.

          If you think power changes every time that a Prez changes then I can only say “whatever.”

          1. Brooklin Bridge

            You have shifted the discussion from Obama’s priorities to power vectors; whatever indeed.

            You make it sound like all presidents are paper thin puppets plugged into the wall every four years and anyone who disagrees is to be treated with, “whatever” The Presidency, the Speaker of the House and Senate, are far more complex than simply an endless stream of industry puppets and every President since you or I have been alive – including Ford and Carter – has made that abundantly clear.

            1. Brooklin Bridge

              Note, I agree with your “Senior Partner” concept but that has little bearing with Obama’s intentions. Obama may have weaknesses as an individual, (I think I would agree with you on that as well only not across the board), with out that having anything to do with his priorities and the amount of power his office and the people surrounding him exert in making those priorities materialize. Finally, whether or not Obama is simply twerking as the strings are pulled makes no difference. Those are his priorities as much as they are the priorities of his senior partners pulling the strings and they ARE reflected in both the NSA as well as this current ACA software/hardware config. fiasco. But I would still maintain that the powers of the President, each one of them, are immense by an unspoken agreement with the “Senior Partners” and all other players who profit from that arrangement but who also fantasize about being in that office.

      3. Nathanael

        FWIW, Banger, the NSA system is a total disaster, as confirmed by various whistleblowers. It’s great at sucking in information, but it has zero internal security. The NSA *doesn’t know what Snowden took copies of* — it’s that bad.

  4. Doc at the Radar Station

    Huh. I wonder if the whole thing would be a lot simpler, less confusing and a whole lot less expensive if they just designed a physical paper document and a small instruction book similar to a tax form and just mailed it to everybody? You sign it and mail it in. Hire some reasonably smart and well trained everyday Joe’s and Jane’s to tend to some telephones. Oh, yeah, that’s the kind of workforce we’ve been eliminating…

  5. YankeeFrank

    It amazes me that the site doesn’t eliminate the submit button once its pressed. That is some simple javascript that totally avoids the double-submit problem, and that runs client-side, meaning there is no slownesss issue as the page doesn’t have to communicate with the server before disappearing the button. Its the kind of mistake people would make 12 years ago when designing a simple shopping cart. Its not something anyone would do today if they weren’t completely incompetent. Amazing.

    1. Larry Headlund

      “It amazes me that the site doesn’t eliminate the submit button once its pressed. That is some simple javascript that totally avoids the double-submit problem”

      Javascript doesn’t help on browsers which have it disabled. Even on javascript enabled browsers eliminating or disabling the submit button alone will not avoid the double submit problem because some browsers (i.e. most IE versions) also submit when the enter key is pressed. Also, javascript which will work on most, let alone all, browsers is non-trivial. The existing cross-platform libraries have the disadvantage that they increase loading time for customers with slow connections.

      Robust cross-platform solutions to the double submit problem are server based. However, even some long established commercial sites (like American Express) still carry warnings about repeatedly pressing the submit button.

      1. Ted Baumann

        I found that the site didn’t work at all on Google Chrome, but worked perfectly well on IE. I wonder whether anyone has explored that angle?

      2. David

        Agreed – the issue based on the multiple submit problem sounds like a system that doesn’t have idempotence capabilities. The challenges around implementing that capability are quite high and likely why many sites warn about clicking submit more than once. It’s easier to just spit out a warning than try and code this into the system.

        It’s hard to imagine how challegning designing and implementing a system like this would be. But then tack on back-seat drivers in the form of administration politics and you’ve got a recipe for disaster.

        From what I’ve gathered thus far, requiring user validation of data to get at subsidies is insanity. I don’t know what that validation process is but if it requires the ACA systems to interact with other external systems (e.g., IRS) then who knows if those systems can handle the extra load?
        Just so many touch points and opportunities for problems.

        I wonder what the impact will be on the IRS if there are a lot of subsidy discrepancies…

      3. craazyboy

        True dat javascript on/off and having to program for 6 different browsers with varying functional capabilities ’tis a royal pain in the butt to program for. Which is why I tried to find good old non-web windows front end corp systems to work on as long I could find them. Before retiring. But I think this can get handled by server side “session objects” which remember browser IPs in between round trips to the server. Or you just have to tell people how to set their browser settings and which browsers are acceptable.

        But the thing this also implies is the only way the DB would accept multiple submits and generate another customer record for each one, is the DB designer must have used a auto-generate primary key for the customer record. Then the database just creates a unique number for the primary key to uniquely identify the record and you have a new record for each submit.

        This is the most “flexible” and easiest way of designing the structure of a relational DB. It’s probably the way it would be done if you knew nothing about the nature of the data.

        The other “obvious” way would be to use the customer SS number as a unique identifier. Multiple submits, after going thru the middle tier biz objects, which are supposed to know whether this is creating a new record or editing an existing record, would attempt to do a DB “insert”, but that would generate a DB error, then some appropriate action could be taking by error handling routines.

        But experienced programmers know nothing is obvious. There may be some reason there is a segment of the population that needs to buy IRS subsidized healthcare and they do not have a SS number.

        In the corp IT world, if you are very, very lucky, they have what are called “business analysts” which are involved in the design phase and will find out answers to questions like that and generate what is sometimes called a functional spec.

        So it looks like there was no design and no testing on this little puppy!

        1. Brooklin Bridge

          I agree. The multiple submit issue is a moderately difficult issues to address, particularly if you are not using a framework that addresses it and particularly across browsers and platforms, but on the other hand it HAS BEEN ADDRESSED countless times by countless software teams big and small with countless software frameworks over the last 20 years. This is NOT new territory. This is the sort of problem even in small companies that is usually fairly well flushed out before any Beta testing even begins. By Beta, you are usually working on business logic and transactional integrity and things like unintended button clicks have been reduced to the exception.

          There are tried and tested protocols out there already for business validation of ability to pay or of financial status and I’m sure the IRS has others. Granted, this is one place issues would understandably occur but again, it’s hard to believe that such a visible product would have such basic 101 problems and design flaws or that they would be handled so superficially.

          I don’t think this has anything to do with a weak or bumbling administration; they are neither that weak nor that bumbling. I think it has everything to do with the administration’s real priorities.

          1. craazyboy

            Ya. These were challenging issues back in the late 90s when we all tried developing our first web app from scratch. But in 2013 it’s all been done already.

            I think it can’t be done, with the proper design phase in the beginning – along with legislating the project requirements in parallel – in the 18 month time frame allotted.

            Plus it looks like whomever had the lead systems integrator/ contractor coordination role really blew it, or again, no time for silly things like that and the consumer got handed the parts in a box with no assembly manual.

            1. Brooklin Bridge

              It’s very likely the contract was awarded by political considerations rather than by evaluation of reputation and past successes, etc..

              But even granting political favors as the means of selection only goes so far. This is Obama’s legacy program; his baby. If he were not vein, if this whole thing were not beneath him, it is highly likely he would have had multiple backup contingencies and plenty of weekly QA reports going back to someone very alert and very smart in his administration. I mean hell, for something of this magnitude, the usual, “Everything’s going fine, see you next week, click”, status report just won’t cut it. If these problems are systemic rather than just quickly fixed bugs – and the latter could still be the case, it could end up making the Tea Party look like Sooth Sayers (or tea leaf readers) and Obmama and the Democrats look like the basket cases.

              And we haven’t even touched on all the incredible tools and frameworks that are out there for automated testing now-a-days. Granted, this isn’t code to get rockets to Mars nor even to get government malware into citizen’s computers, but still it’s Obma’s signature legacy (at least the one he wants people to be aware of). It’s really bizarre.

              1. craazyboy

                The old maxim of bullshit in – bullshit out still holds true and if the insurer is getting not only incomplete data but multiple records for the same customer account, it’s really pretty simple. Software systems aren’t supposed to fling bullshit around like shit thru a goose. It’s incompetence both technically and in project management. All made worse by a compressed time frame and lack of testing.

            2. Yves Smith Post author

              Late to this. New article in the National Review (based on interviews) says THERE WAS NO LEAD CONTRACTOR. See 10/19 Links.

              Does that explain pretty much everything?

          2. Carla

            “I don’t think this has anything to do with a weak or bumbling administration; they are neither that weak nor that bumbling. I think it has everything to do with the administration’s real priorities.”

            Sure. Fine. I didn’t even vote for the guy this last time.

            But why would they want to look so utterly stupid and incompetent?

            To quote the King of Siam via Rodgers & Hammerstein “‘Tis A Puzzlement”

            1. Brooklin Bridge

              But why would they want to look so utterly stupid and incompetent? -Carla

              They wouldn’t, of course. That the the ACA application process is so potentially buffoonish comes from political favoritism in the selection of contractor and from Obama’s arrogant indifference to the details of mere software. And Obama and the Democrats and the insurance companies may well pay dearly for that indifference, at least until things can be set right or until Obama declares that insurance companies have the right to arrive at your house and simply posses your material assets until the bugs are worked out.

        2. Larry Headlund

          “The other “obvious” way would be to use the customer SS number as a unique identifier.”

          SS numbers are not unique. There is even a least one case of a duplicate name/SS number pair.

  6. Jim Haygood

    ‘If that [subsidy calculation] part of the software doesn’t work well, you have the prospect of consumers getting stuck with IRS bills that are wrong or unexpected (as in they provided the right information but the subsidy was calculated incorrectly).’

    Yes. Moreover, there will be another large group whose subsidy was calculated correctly when they enrolled, but then their actual income deviated from the estimate. Maybe they got laid off, changed jobs, worked overtime, received sales commissions, had a debt cancelled, you name it.

    In any case, trying to adjust a subsidy via the IRS is a prescription for frustration. The massive, creaking machinery of internal revenue was never intended for fine-tuning subsidies and adjusting insurance premiums.

    For the record, I don’t expect anywhere near seven million to sign up for Obuggercare. As Lambert and NC have emphasized repeatedly, adverse selection is going to eat O-care’s lunch, followed by savage premium hikes in 2015. But even a couple of million sick victims could not only bog down healthcare.gov, but also throw sand in the gears of IRS tax return processing. Good or bad? You decide, comrades!

  7. TomDority

    Maybe a dumb and purely un-informed comment on my part here.
    Did I read the rumblings about how administrative costs are going to be higher because the system is screwed up a bit?

    If I were a fox put in charge of the hen house (ACA) and wanted to feast on chickens…. well, I just might be hankering to grab some chicken through the administrative, serve-up-the-vittles-and-gravy, method seen in so many ‘business models’. AKA – we can’t be expected to trim our fat given these insurmountable problems we….er ah….that were foisted upon us innocent fox.

  8. Pearl

    One of my friends did a screen shot of her online “chat” with the Enrollment Center. The “bot” who was talking to her introduced him/her/itself as “PGSTX 1041.”

    We tried to find out if that meant anything in Programmer language. All we could come up with was (using a Scrabble website) that the letters PGSTX could be used in the word “postfixing,” which is, apparently a programming term. And the “1041″ part–we were wondering if it made a stop at the Treasury Department to check her (their) IRS filing first?

    But my friend is also just a housewife; we were just having a Lucy and Ethel moment. We have no idea what this actually means.

    But does anyone else have any idea what PGSTX1040 would mean in programming land?

    My husband and I were able to sign me up for an account, but have not been able to sign in again. So we don’t know where it stands and are just waiting a while until some of the bugs get worked out.

    Personally–I hope it all blows up and we can just get single-payer. That’s what I wanted all along. I don’t want the insurance companies taking a piece of the healthcare dollar pie. I’m not a fan of healthcare insurance companies.

    1. Carla

      Insurance companies (of any kind) exist to do two things: Collect Premiums, and Deny Claims.

      A tree fell on your house? Your fault! Claim denied!

      You were injured when another car smashed into yours? Your fault! Claim denied!

      You’re sick? Your fault! Claim denied!

      You’re dead? Well, actually, unless you killed yourself, this is the one type of insurance that usually pays. Unfortunately, you have to die to collect.

  9. middle seaman

    The different accounts of the enrollment failures make the picture quite clear. Undoubtedly, the contractors who build the system are not qualified for the job. It’s not as if we haven’t seen similar failures in the annals of software system construction. One of the famous ones was in the end of 80s and beginning of the 90s. The FAA contracted for a total replacement of its centers systems. The project lasted roughly 5-6 years and never got anywhere. It was canceled during the Clinton administration at a cost of several billion dollars.

    Apparently, we have a new FAA-like colossal failure on our hands. Starting from scratch will probably be faster and cheaper. HHS should call on giants such as Google, Microsoft, etc. for swift advice and may be even help. These companies have the expertise and the best people available.

    1. curlydan

      I think you’ve identified the problem: contractors. Your solution, though, involves more contractors.

      Here’s my solution, and some could say hindsight is 20/20, but I think I would have proposed this in 2010: Hire full-time, permanent employees, pay them a decent wage with benefits, give them good project management, and get this m-f’er built right in 3 years.

      As Juan Gonzalez pointed out this morning on DemocracyNow about a NYC corruption case: “what I’ve considered for years to be the prime form of corruption in modern governments in the United States today, which is information technology contracts. It’s the new form of patronage and corruption in local, state and federal governments”
      http://www.democracynow.org/2013/10/18/vast_corruption_in_information_technology_contracts

      1. Banger

        Gonzales is right. I spent a lot of time as a government contractor I can assure all of you that the corruption is deep and was engineered to be corrupt by Congress. There re honest and dishonest contractors but the way the system is set up it’s just too damn easy to game the system. The central problem is that there is not a central technology office manned by top professionals who give out contracts and create government-wide standards. I can’t even begin to tell you the stunningly wasteful projects I’ve seen and how no amount of reasonable solutions some of us offered were ever listened to because of the political power of favored contractors.

  10. Howard Lippitt

    The ACA sure seems a mess. Maybe the Obama administration can help the poor health insurance companies deal with their higher expenses by proposing a new plan called No Health Insurance Company Left Behind. It can be funded by a nationwide tax on college age kids.

    Ugh,

    Howard L

    1. NotTimothyGeithner

      This was the point of ACA. The hospital cartels are killing insurance companies, and insurance companies needed do customers.

      Making people pay for insurance when they can’t afford the co-pay is the best kind of customer. They can’t collect.

      1. Ed S.

        The hospital cartels are killing insurance companies

        A very important and frequently overlooked point.

        Orthopaedic surgeon I know mentioned this with respect to the local hospitals (Bay Area) and how they buy medical practices, integrate them into the hospitals, wait for the docs to retire and then jack up prices (which goes to the hospital). He may not have studied economics, but he knows an oligopoly when he sees one.

        And as a side note — he performed a reasonably complex surgery on my spouse (about 90 minutes)

        Dr. Fee (rack rate) ~~ $3300 (reduced to about $2k)
        “Surgi-Center” (rack rate ~~ $19,000)

        The “Surgi-Center” is on the first floor of a medical office building — but owned by the local hospital. I was there for most of the day — they probably did 25 procedures.

        1. Nathanael

          The hospital cartels are a really serious problem. However, I suspect they will get away with it for another couple of decades. The insurance companies just got hit; in order to keep distracting people the hospital cartels are going to redirect their fire at the pharmaceutical companies, who will go down next (they’re weak and have made a large number of enemies). The hospital cartels won’t go down until after the pharma companies, at which point the hospital cartels will finally be in the line of fire.

  11. TarheelDem

    In looking at the federal exchange, remember that GOP governors changed their declarations of whether they were going to do a state exchange or the federal exchange. The last to make this determination was North Carolina–in July of this year. North Carolina is the 10th largest state by population. Not being able to have stable requirements — there likely are back-end interfacing with various state government systems — meant that the rollout would not be smooth.

    It is interesting to me that so many of the reported problems in this article are from states with Republican governors.

    Given the active sabotage (including a government shutdown) that the GOP has conducted on what was an already complicated system (thank, Max Baucus), it would not surprise me to learn that smaller insurers in GOP states might be reporting problems. They would be the ones most likely to be left out of any sessions designing interfaces with their existing systems. And GOP governors had incentives for this not to work.

    However, most states that did state exchanges have dealt with their problems and the enrollments are picking up. And people are reporting savings because the individual insurance market was so full of junk insurance in a lot of states.

    Remember that single-payer Medicare-for-All is still a possible plan B. Rolling it out requires only legislation removing the age restriction and appropriations to cover estimated cost of benefits and additional IT capacity for a proven IT system. The success of the rollout of Obamacare will be reflected in the 2014 election; there’s some incentive to get good results right there. And insurers know that the pressure will not be to roll back and repeal but to go forward to single payer. That will be incentive for the first few years to benefit patients.

    If this rollout turns out to be the flop most folks here are predicting, single payer will be on the political agenda again before 2016.

  12. Eureka Springs

    I would rather stick my hand in a wood-chipper than give healthnotcare dot gov incorporated my name and numbers.

    1. Bridget

      Ha! I’ve been playing with the chat feature of clusterf**k.gov. I explained that I just wanted some pricing information as I didn’t want my privacy invaded by answering all of the questions necessary to create an account. “Michelle” informed me that I needed to create an account in order to determine my eligibility for subsidies. I explained that I knew I didn’t qualify for subsidies, and just wanted some pricing information. “She” repeated to me that I needed to create an account yada yada yada. I then asked if I had to use my real name. “She” then informed me that my eligibility would be verified by the IRS, the Department of Homeland Security, and some other agency. Hilarious. I thought to myself then that nobody is going to put up with that crap except for the sickest and most determined of people.

  13. Andrew Heinonen

    This confirms my theory that Insurance Company CEO’s are probably all the progeny of 19th century robber barons who couldn’t build a railroad with tinker toys. These people lobbied hard for this huge government mandate and then just sat back for three and half years and waited for the money to start rolling in; I find their lack of for site on the practical implementation of this dreck hilarious: No liason departments with the governments IT contractors? So what about all of the other vaunted public/ private programs out there that taxpayers continuously bail out? Useless parasites I say.

  14. elboku

    On the other hand some of the states are doing better: Though the Oregon’s health insurance exchange is not yet up and running, the number of uninsured is already dropping thanks to new fast-track enrollment for the Oregon Health Plan. KIFF And: The Wall Street Journal looked at this and concluded: “ (Kentucky) State officials and outside experts attribute the smoother rollout to a variety of factors, including intensive testing of the system, a less-flashy but more-efficient website and strong coordination among state agencies involved in the effort.” CNN Yeah, I know it sucks that only 50k in OR and 12k in KY got coverage so far. Horrors.

    Maybe they should let the states take care of things? Oh, I forget, the rep. states refused. And now things are gummed up. Funny how that works out, ain’t it?

    1. Lambert Strether

      First, that makes the disaster at the Federal Exchange level all the more evident. So it will be interesting to see if there is any accountability.

      Second, the Federal Exchange disaster is in essence a teaching moment and a well-deserved example of brand destruction. However, huge though the IT challenges were and are, the real issue is the nature of the coverage offered, whether at the state or the Federal level. That’s where the co-pays, the deductibles, the thin networks, and the still-presemt ability of health insurance companies to deny coverage for “fraud” (What you didn’t tell us you had a hangnail when you were 13?”)

      For perspective, if Obama had had his glorious showdown with the Republicans in 2009, instead of 4 years too late, and passed single payer, we would already have saved a trillion dollars (assuming a one-year rollout), covered everyone, and saved thousands of lives.

      ObamaCare is pathetic by comparison.

      NOTE Given your “let the states do it” attitude, do you support single payer experiments in the states?

  15. Yancey Ward

    I don’t really understand the rationale for using “estimated” AGI. Seriously, why not just use the actual AGI from the previous year, which is already stored in the IRS computers.

    Having people estimate this for subsidy purposes is going to be a disaster politically, even if the rest of the system worked perfectly. Simple human nature is going to cause a majority of such people to under-estimate their income just to receive a larger subsidy, and the IRS will eventually claw back the money.

    1. katiebird

      To make it even more confusing, we aren’t just estimated next year’s AGI. We have to estimate next years Modified AGI – MAGI. Which might not be any different. But, it’s another layer of confusion and detail.

    2. Ted Baumann

      Using 2012 IRS income would screw people like me whose job situation changed – involuntarily – in 2013. Given that a lot of those folks end up as freelancers or otherwise without corporate insurance, that’s a big issue.

      1. Yancey Ward

        Someone was always going to get screwed- but we should be looking for the operationally easier solutions rather than worrying about what screws you personally.

      2. Lambert Strether

        Well, don’t worry. In future, you’ll always have to report income changes to ObamaCare. So they can recalculate your subsidy. This will be especially fun and totally not error prone when you change states or if you are on the bubble between total Loserville at 138% (Medicaid) or alternative Happyville at 400%, since your situation changes drastically with a few dollars either way.

        1. craazyboy

          Being a young retired person supporting myself as a very petite rentier and using my nest eggy to extract variable income anywhere I can find it (.25% at present, but if I get bold I can try day trading and steal it from HFT bots), I happen to know the IRS requires you to estimate your annual income and then file a quarterly estimated withholding payment if you were lucky enough to make some money somehow.

          I shudder to think how that will work with estimating my income(in the chance I may have any someday in the future) AND estimating a potential subsidy (or fine, if I score a 10 bagger off some sleepy HFT bot) in our new O Care website.

    3. Jim Haygood

      ‘Seriously, why not just use the actual AGI from the previous year, which is already stored in the IRS computers.

      Yes, and to take it a step farther, why not set a signup period from Apr. 1 to Jun 30, for a July 1 to June 30 coverage year, which coincides with most states’ fiscal year?

      Then you file your tax return on April 15th, sign up for O-care with final income for the previous tax year, and there is NO need for estimates, retroactive adjustments, surcharges, refunds, etc.

      Too simple, isn’t it? One can imagine two scenarios why it isn’t done this way:

      1. Public sector incompetence (not even getting the simplest basics right).

      2. An intentional mess, which will generate millions of billable hours for tax specialists, and jobs for more navigators and IRS workers.

      MOM! Barky sh*t the bed again!

  16. Yancey Ward

    I disagree that the insurers will be hoisted, however. At some point, if it becomes clearly money-losing to continue to fix these applications, they will simply throw in the towel and stop taking additional customers. I now suspect that this was precisely why a number of the big insurers refused to participate- they could see the what was coming.

    1. Yves Smith Post author

      Did you read the post?????

      They insurers who are on the Federal exchanges are in. No backing out now.

      If they don’t try to take as many enrollees as they can, they’ll be stuck with the most motivated to get enrolled, which are the sickest. Those are the people the do NOT want. The Journal separately confirms this point in its insurer and customer research.

      1. Yancey Ward

        I read it Yves. Did you read my comment- I said they won’t take any new applications if taking them just adds to the loss- hoisted on their own petard was your phrase.

        I am asserting that if that is a real danger, they will honor the policies already sold, but stop taking junk applications for new customers until the exchanges improve. They aren’t morons. The Feds have, in my opinion, about 6 weeks to get this back-end problem solved, or you will see the insurers close enrollment if the processing is a high unforeseen cost of this failure.

        1. Lambert Strether

          I can’t imagine they have the power to refuse applications.

          Though one does wonder… Faced with two applications screwed up by the Federal Exchange that have to be fixed manually, which would you do first? The one with the sick person, or the one with the well person?

          1. Nathanael

            Guaranteed issue — no legal power to refuse applications.

            The most likely result in a number of places is for every insurer but one to exit the market; for the remaining one to jack prices up beyond the tolerance level of local politicians; and for a public option to be created instead, which will become the de facto single payer option in the area. This will take a long, long time though.

  17. Dan Lynch

    I see the following scenario as a potential big problem:

    A person estimates his 2014 income will be $14,000, which qualifies him for about $5000 of subsidies. So he is given a free bronze plan, which is useless to him because he can’t afford the deductibles and copays.

    But then it turns out that his 2014 income is only $12,000, not $14,000. That disqualifies him for the 2014 subsidies, since people below the poverty line don’t get subsidies. So he gets slapped with a $5000 “tax.”

    There will be major fireworks when that happens. People are going to be outraged when they get hit with a $5000 tax for a useless bronze plan that didn’t help them one iota.

    Bear in mind that many of the uninsured are self-employed, or temp workers, or seasonal workers, or in-between jobs, and those kind of people don’t know what there income will be from one day to the next.

    1. Splashoil

      Ah, but you left out the glorious churn into Medicaid where a tab will be started for monthly premiums and expenses when you drop below the threshold income. MERP (Medicaid Estate Recovery Program) will be ready to pick over your assets at the end, so live it up!

  18. mcgee

    Is it fixable? Was it ever really conceivable that a country where the vast majority live paycheck to paycheck, would pay for a forced product of questionable usefulness? Can a service based economy generate the surplus wages necessary for the tens of million of uninsured to pay for health insurance with large deductibles and limited coverage?

    The average American already has so many hands in their pocket that there is no room left for their own to fit. The economic lesson undergirding this experiment in rentier capitalism is what can’t be afforded by government or the citizenry, simply won’t be. The knock on effects of this failure will be varied and far ranging, the least of which will be our President’s signature achievement of “health care for all” leading to…even fewer insured with higher costs associated with the growing monopolies and their ability to dictate price. The battle between the corporate behemoths of providers and insurers will make for some well paid lobbyists and associated campaign contributions. All passed on to the ‘consumer’.

    1. katiebird

      I keep thinking that, “How many hunks of $350-$600 do you think I’ve got in a month?”

      It just doesn’t make sense. People are supposed to cough up enough for those premiums AND put money aside in case they actually have Medical Expenses? And THEN …. should their income estimate be off, lose whatever subsidy they might have miss estimated?

      All this, to protect the income stream of Insurance Companies? It’s crazy.

      1. Banger

        The insurance companies play the political game and those who oppose them are not even on the court.

      2. Jim Haygood

        Maybe they’re meant to get out and sell drugs to raise cash for their O-care premiums.

        It raises incomes … and those who get popped will get free health care in prison.

        Everybody happy in Barky’s healthcare paradise!

    2. Banger

      I’ve been all over the map on the ACA. On the one hand, it offers a chance for certain people to get health insurance that would never be able to get it at all. My wife simply could not get insurance at any reasonable price. Other people I know who have health conditions can’t afford health insurance thus just don’t go to doctors so simple, easily dealt with conditions fester and get worse. If these people are forced to get insurance it would put them further in debt but would possibly give them a better chance to live a decent life while dodging the bill collectors at least for a few years.

      On the other hand, the ACA is in conception and practice malignant because it puts a layer of fixes on a system that is not just bad but deeply malignant in practice and intent. The industry exists purely to maximize profit and for HC that is an invitations to tragedy on a massive scale. The right, rather than actually try to kill the ACA created all kinds of false issues, stupid rumors and so on that would appeal only to a minority of similarly deluded voters so that many of us were put in a position of defending the ACA against idiotic arguments. I still basically oppose it but so what? We have to live with it now–I did what I could to oppose it when it came up while the DP left lined up to embrace it–I believe this was the biggest mistake made by alleged progressives since many embraced the idea of the War on Terror and still do.

        1. Banger

          We live with a lot of things. I’ve been to places where people get used to not just absurd situations but dangerous ones too. The human spirit can weather quite a lot.

          1. just_kate

            That’s true but this is case where there were better solutions that could have been pursued and none of them were seriously considered (or consider at all). I can think of quite a few bad outcomes that could push people beyond their limit having to suffer under this new system when alternatives are out there in other parts of the world.

      1. Brooklin Bridge

        That’s a nice summary, but do we really have to live with it for now? A better question is should we live with it for now? The implementation of Obamacare will set health care back at least ten years in this country and probably more, especially if we learn to hobble along with it such that something like single payer can never get legs. We can learn to live with poverty, endless wars, spying on our citizens and on the world at large regardless of whether or not they threaten us, with the absence of Habeas Corpus, and with shitty health care that enriches the rich, but if we do, we need to remember that those conditions prevent perfectly possible and healthy alternatives by their very existence.

        1. Carla

          “We can learn to live with poverty, endless wars, spying on our citizens and on the world at large regardless of whether or not they threaten us, with the absence of Habeas Corpus, and with shitty health care that enriches the rich”

          And we have learned all of these things.

          What we have not learned is that we have the power to change them. And if we do not seize that power, they will not change.

          Start at http://www.movetoamend.org

          Continue at http://www.projectcensored.org where on the “research” tab you can find the names and affiliations of the 161 people that through interlocking directorates control the finances of the entire world.

          Spread the word.

  19. Reuben Kincaide

    What concerns me most about Obamacare is that for insurance bought on the exchanges, the insured’s premiums are capped at a certain percentage of income, so insurers no longer have any incentive to try to keep premiums in an affordable range. For example, if my income is $80,000 and my premium contribution is capped at 9.5% of my income, it makes no difference to me whether the insurer charges me an annual premium of $10,000, $20,000, $30,000 or whatever because my cost is going to be the same regardless.

    1. Yves Smith Post author

      No, they can’t raise it to the moon. 80% of total premiums have to go to health care.

  20. docg

    As someone with a fair degree of experience with computers and computer software, both as a programmer and a teacher, I have to say I have a bad feeling about this situation. A great many people have serious problems dealing with even the best designed software interfaces, and this looks to be one of the worst. On top of that, the Obamacare system itself is far too complicated, too riddled with red tape, and offering far too many options, none of which is going to be perfectly suited to hardly anybody, for even experienced computer users to feel comfortable negotiating.

    I hate to say it, because I do think it would be a significant improvement over the old system, if it could be made to work, but I foresee an embarrassing failure. Looks to me like the whole deal is going to have to be postponed for at least a year, and may ultimately be totally scrapped. Hopefully, the lesson to be learned is that we have no choice but to adopt the far simpler single payer system. Let’s hope.

  21. Massinissa

    Maybe Obama is playing 14th dimensional chess and this mess is on purpose so he can turn around tell congress to adopt single payer…

    As ludicrous as that sounds, I could probably find some folks on Daily Kos who would believe it… At least, if anyone there even realizes what a mess this whole thing is.

    1. NotTimothyGeithner

      I don’t think they have enough self-awareness to believe this. 853rd dimensional chess is just the Obot version of Republicans who say “I worry about the national debt” or “abortion” when they really just don’t want to admit they are pricks who simply like their team.

      The simple voters who I think do their best given the state of the media and two parties kind of buy these excuses because they seem big, nebulous, and the domain of their betters.

      The Syrian situation was an epic disaster for the President and represented a world push back against American imperialism. The claims of 853rd dimensional chess didn’t even make sense, but it was about justifying their adulation and often their support for “liberal smart wars” merely because Team Blue proposes them.

  22. aletheia33

    the ACA process has been likened to HAMP, which is captive of the mortgage industry. the “Health Insurance Marketplace” is captive of the insurance industry. it will be equally difficult to trust the murky processes and the insurers in the latter case. surely the insurers already have divined how best to game this system to expand their take and will do so to the max they can get away with. the sky would seem to be the limit on that.

    we all know the ways HAMP has made sure that people who are already down cannot get up, not helped them. no one has been held to account for any of that abuse, which should be treated as criminal. we can expect the same lack of accountability as ACA goes forward.

    we have also seen how little anyone else–the media, the “public”–cares about the people hurt by HAMP. they are gullible victims, “losers,” and are swept under the rug to keep the rest of us happily fantasizing we’re invulnerable (right up until we’re not). “i alone will survive the sinking titanic by jumping off of it at the exact right moment.”

    so to generate enough groundswell against the ACA to make a difference, the program would have to be so massively harmful to so many people that i believe it’s unlikely. but one can still hope…

  23. Dean

    Didn’t Hippocrates say “Let food be thy medicine and medicine be thy food”?

    Seems if we collectively ate better (natural, whole, unprocessed foods) many of the costly ‘lifestyle diseases’ wouldn’t exist. And the need for such a monstrous healthcare bureaucracy wouldn’t either. And big pharma wouldn’t be so big.

    But alas…that’s too simple and not profitable enough.

  24. MIWill

    Wait. After some people click submit, they click again? Several times?
    How is this not a felony?
    Seems prison for profit lobbyists went narcoleptic in a few meetings.

  25. Brooklin Bridge

    This has the potential to more than undue what ever gains the Vichy Democrats have made in the perception market over the budget food fight. Add that to the fact that no matter how cleverly they gut and cut the safety net, probably during the upcoming debt ceiling negotiations, and manage to shuffle the blame to the other party, there will be major resentment from all constituents across the board. As Yves has pointed out, voters will tend to take it out on the party that is in control of the WH and the Senate. They might do so in the House against the Republicans but as I understand it, the Republicans have gerrymandered their districts up good and tight thanks largely to the shameless behavior of all Democrats during the health care insurance fiasco and the extension (with Dem control of both houses) of the Bush tax cuts for the rich which led to the 2010 rout (although that is still effectively a state secret except in places like this site).

    1. different clue

      And if the Rs take the Senate, House, and White House; ObastardCare will remain the law regardless. At least the Forced Mandate part of it will.
      The only way the Republicans could get a repeal ObastardCare law passed is if the Tea Party speCIFically could capture veto-proof majorities in the Senate AND the House. Otherwise, a coalition of Establishment Republicans and Catfood Democrats will pass such a law from even being passed. The only way the TPs could get ObastardCare repealed is if the take the House and Senate and Presidency.
      “Republican” majorities would not be enough. The majorities would have to be strictly Tea Party, and the President would have to be Tea Party. A merely establishment Republican would never sign such a bill. And even a seemingly Tea Party President might turn out to be an Obamaform trojan horse for the Establishment Republican/Catfood Democrat Coalition.

      1. Brooklin Bridge

        Agreed, ObamaCare – especially the government pinning your arm up around your neck and then increasing pressure (the mandate) – is here to stay. BTW, great expression, “Catfood Democrats”.

        1. Lambert Strether

          “Catfood Democrats” has been around for awhile — I think the progressive blogosphere came up with it when Bush tried to privatize Social Security — but it still stings.

          “Senator, are you a Catfood Democrat?”

          For young people hung with student loan debt, I think the answer would be:

          “Senator, are you a Ramen Noodle Democrat?”

          NOTE Warren, who wants to peg student loans to the prime rate, is most definitely a Ramen Noodle Democrat. If Beard were around, he would say the issue is usury as such, and not the cut the userer takes. And he would be right.

          1. different clue

            And here I thought I had invented “Catfood Democrat” myself. I got it from elsewhere and don’t remember? All credit to the prior inventor(s) then. It is a good name regardless.

  26. bluntobj

    I had a very interesting training yesterday. It was geared for Fire/EMS districts, and dealt with the nuts and bolts of compliance with ACA in organizations with large numbers of volunteers.

    Highlights:

    Premium costs can be expected to increase by 12-14% per year due to CERF ($2 per body), HIIF (health insurance industry fee) by 2-2.5% in 2014, 3-4% thereafter, a $60-90 reinsurance assessment per member per year, 3-5% per year increase for non-claim costs, plus 2-3% from previous years, plus normal increases for cost increases in providing care.

    Most 100% benefit plans for firefighters will surpass the “cadillac tax” threshholds with the above increases in 3 years, resulting in a 40% tax to the employer for excesses over the thressholds.

    Volunteers are considered employees, and if they volunteer over 30 hours a week in the measurement periods they must be offered full coverage. Volunteer hours are totaled and divided by the number of volunteers to check for the 50+ threshhold; ACA is about FTE’s (Full time equivalents), so part-timers count toward reaching the threshhold. They may not be eligible for benefits, but they can push you over the 50+ requirement such that you MUST provide benefits.

    Employers are responsible to pay the employer penalty if one of their employees refuses affordable coverage and then gets a subsidy on the market.

    If you don’t offer coverage to all employees, and you are pushed over the 50+ line, and 1+ employees use a subsidy, you pay the penalty on all employees over a base of 30 employees.

    If you don’t offer affordable coverage, but you offer coverage, then the penalty is multiplied by the number of employees that use a subsidy.

    To be considered an “In network” provider, you must reduce your fees by 50%* to the insurance company.

    *Which goes to show that if you pay cash you should damn well get a 40% minimum discount.**

    **Which also explains why the cost of sickcare must neccesarily increase in perpetuity at a geometric rate.

    So for the government agenices I work with, ACA will be a budget wrecker. With taxpaying citizens having to shell out $4000+ additionally per year for ACA, you think they are gonna go with a levy LID lift? Think they are gonna vote for that Fire/EMS bond renewal?

    ACA is merely another example of competitive advantage granted by government, with the amusing side effect of actually cannibalizing local, county, and state budgets to feed the Sickcare cartels.

    Richly amusing…

  27. Kris Alman

    As a physician activist, I was curious about the navigator training and completed it in Oregon. We were told that the individual reports income, which is cross-checked with the IRS. If the reported numbers exceed a 10% variance, the individual is flagged and must bring documents to support their claims. If someone is unemployed (including seasonal workers) in Oregon, they will immediately have access to Medicaid, regardless of their previous income. That said, they must report expected earnings, which means that once they are employed they must report this or they will need to pay up the differences at tax time. I tried to push to find out more about potential penalties, but did not get that information.

    Bottom line is that the computers are cross-checking with the IRS here in Oregon, so I have to assume that is the case for all the other exchanges.

  28. Mac

    If folk enrolling are asked come up with estimates of income , there will be a moment when someone figures out why people pay to have someone prepare the 1040ez.

  29. cripes

    Jusr a note on comments that NSA software contractors would never dare create a piece of junk ilke Obamacare website app. Au contraire; they do it regularly. SAIC haasenjoyed no-bid cost-plus failures running to billions of dollars for crap that never got used (NPR). why should it be any different than stealth bombers?

  30. cripes

    Oh yeah, part of CIA director Michael Hayden’s push to outsource CORE IT functions and privatize Everything. Maybe it’s the silver lining we’ve been looking for: incompetence of private enterprise at anything except looting. Think of the possibilities.

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