By Lambert Strether of Corrente.
The key point to remember in all discussions of ObamaCare is that neither it, nor indeed the entire private health insurance “industry,” should exist. They are rent-seeking parasites, economic tapeworms. One does not improve a tapeworm; one removes it.
To understand this simple point, all we need to do is look north to Canada, where we see a single payer system — they call it “Medicare” — delivering equal or better health outcomes at dramatically lower cost, without a health insurance industry, and without ObamaCare’s bizarre, mystifying, and above all unfair Rube Goldberg-esque complexity. In fact, if we’d passed HR 676 in 2009, we would have saved hundreds of billions of dollars by now (more than enough to cover everyone) and thousands of lives, though ObamaCare apologists don’t like to talk much about the excess deaths that ObamaCare’s achingly slow rollout caused and is still causing.
So, the squillions and the deaths are two opportunity costs of going the ObamaCare route. But there are three other opportunity costs, each of which comes from the process of entrenching ObamaCare into our political economy, and making it harder to replace with anything better. So there are, as it were, three hooks by which the tapeworm fastens itself to the body of its host, before it begins to feed (or extract its rent).
The first and most obvious opportunity cost of ObamaCare could — if ObamaCare entrenches itself — be “government health care” (if we define, as most Americans would, government-run health care as like Medicare here or in Canada, where the government is the single payer, and not like the UK’s National Health Service, where doctors are government employees). Here’s an example of what I mean:
Navigator Program Director Joyce Case said attendees are learning the whole process is not as daunting as they expected.
“A lot of it is fear of the unknown,” Ms. Case said in a phone interview. “When we show them the (insurance) plans they go, ‘Oh, these are private insurance companies.’ They go, ”
(The news story is a description of a very active and seemingly well-organized Navigator program in Volusia, FL, but as we’ve seen above, it’s worse than pointless to be active and well-organized in the service of a program that shouldn’t exist in the first place.) Let me concede that all we really have here is an anecdote, but then, even though Medicare for all consistently polls well, we don’t have a straight-up comparison of ObamaCare vs. single payer that shows how people understand the two concepts. However, the (paraphrased) quote is interesting: “Oh, I thought this was ObamaCare.” What that quote tells me, at least, is that people who didn’t follow the debate closely expected to get something from ObamaCare that was not private health insurance: That is, government health insurance. (YMMV; I’d be interested to hear more anecdotes, especially if there are any Navigators in the commentariat.) Interestingly, many of the people whom ObamaCare’s marketing efforts are ignoring are “vulnerable & unengaged” types, low information types who would therefore be expecting an actual government program instead of a ginormous rent-extracting monstrosity. Oh well.
I bring this up because one of the consistent claims ObamaCare apologists make is that single payer wasn’t “politically feasible” (and never mind favorable single payer polling, or the possibility of nuking the filibuster when it would have mattered, in 2009, instead of when it didn’t, in 2013). Leaving aside the bizarre idea that politics is about accepting what is feasible instead of changing it — “Some men see things as they are and say, why; I dream things that never were and say, why not” (RFK) — ‘Oh, I thought this was ObamaCare’ could show that indeed, there was already a ready-made constituency for a government health care program; that’s what they thought ObamaCare was! (Market state solutions are still relatively unfamiliar, I guess.)
And not leveraging that constituency is an opportunity cost: When people get insurance they become attached to it, which is why Obama lied to them and said they could keep it. So — assuming that ObamaCare does not go into death spiral mode, as, despite the pom pom waving, it still may do — people with new policies under it may be less inclined to seek an even better system, not more. And so, the tapeworm affixes itself to the body politic, the hook being the Democratic Party itself, with its unwillingness to present policy alternatives fairly. (“Only the tapeworm is politically feasible! You purist!”)
The second opportunity cost is the energy, time, and money devoted by Democratic-leaning non-profits and public service agencies, who were given walking around money to become insurance salesmen. Take the SEIU — please:
LOS ANGELES, May 15, 2013 /PRNewswire/ — SEIU United Long Term Care Workers’ Union (ULTCW) is proud to announce that it has been selected as a grant partner by Covered California and the recipient of a $1 million outreach and education grant. The partnership and funding will be used over an 8-month period beginning July 1, 2013, to bring increased awareness about new healthcare benefits and to educate Californians about the subsidy programs available to them under the Affordable Care Act.
“We are pleased to be one of the first recipients of Covered California’s outreach and education grants,” said Laphonza Butler, President of SEIU-ULTCW. “As long term care workers, we understand the importance of ensuring that Californians have the information they’ll need when making decisions about their healthcare options under the new healthcare law, and we are well positioned to reach the array of diverse communities in which we live and serve. We have a lot of education to do in a short time, but we’re ready.”
I’ll skip over the cringe-inducing, mushy jargon of the Democratic nomenklatura (“diverse communities,” “education”, “the information they’ll need when making decisions”), and I’ll also skip over the consumerist implications of “options” (More on the SEIU; the SEIU in VT.) Here’s the question: If you’re going to give a Union a million bucks, isn’t the biggest bang for the buck going to be organizing? And if it’s not, then what good is the Union, anyhow? And so, the tapeworm affixes itself to the body politic, the hook being Union leadership, while they, and the grant writers, grant administrators, and program administrators suck happily from their tiny flow from ObamaCare’s giant stream of rental extraction.
The third opportunity cost is software engineering talent. (The opportunity cost here is similar to the opportunity cost imposed on society by the finance sector, which lures many bright minds for useless or destructive
looting opportunities like CDOs or HFT.) From the Online WSJ:
ZocDoc’s Mr. Massoumi and other health-care entrepreneurs are betting that, given the power to pick their own plans, consumers will gravitate to the online services that are the easiest and most fun to use.
To help build the cool stuff, the startups have poached hundreds of engineers from other Silicon Valley companies and loaded up on investors to keep driving growth. ZocDoc has raised almost $100 million from Khosla Ventures and other venture firms; Audax took in $55 million over the past three years, mainly from Blue Cross Blue Shield of Florida and other insurers.
As we know, that $100 million of VC money is going to spent for a program that shouldn’t exist, and the hundreds of engineers are spending their energy and talents on a project that should never have begun, any more than healthcare.gov should have been built.
Some of those pitfalls might have been avoided with a simpler design, say founders of recent health-tech startups.
“Figuring out what insurance benefits are applicable to you is incredibly complicated,” says Rhett Woods, the head of experience design at Audax. Pointing to a computer monitor in the firm’s new San Francisco office, he clicks through pictograms that greet new users of Zensey, Audax’s healthcare portal, and take the place of tedious forms. The menus are designed for users with sixth-to-eighth-grade reading levels, Mr. Woods says.
Great. So, we spent a shit ton of money and a lot of scarce talent putting pictograms onto the moving parts of an “incredibly complicated” Rube Goldberg device that shouldn’t exist in the first place! Yeah, who knows, the next Susan Kare — she designed the lasso, the paint bucket, and other ubiquitous UI elements for the Mac — might be drawing useless pictograms to help sell junk insurance right now! And then… And then, The Next Susan Kare can move on, not to NeXT, but to another useless, parasitical pictogram project for another ObamaCare project, and then another, and then another, because the complexity is never ending, indeed, self-reproducing! She’s got a job for life! And so, the tapeworm affixes itself to the body politic, the hook being VCs and the software firms they fund, all of whom, just like the SEIU, suck a little bit from ObamaCare’s rental extraction flow.
Can’t quantify any of this, of course; but when ObamaCare apologists talk about how ObamaCare is going to become harder to repeal, I don’t think they mean that a grateful populace will get dramatically better access to health care; I think they mean that ObamaCare is going to develop constituencies based on a distribution of rents; and that many of those rents will flow to political class and “creative class” Democratic constituencies; people much like themselves. Not that there’s anything wrong with that. The opportunity costs, alas, will be dramatically better access to health care for everyone, besides immense waste of time and energy by well-meaning civil society groups of all kinds, as well as software engineers, project managers, architects, designers, etc. All of these people really do have better things to do….
 Yes, single payer is “centrist,” globally.
 Health care is, Obama avers, the right of every citizen. In Canada, everybody’s got the same access as everybody else. Under ObamaCare,there’s all these different “options” to sort through, all with different levels of risk, many of them junk, and others scams. Which country implements health care as a right better? (And don’t tell me “Because freedom!”) It’s like they’re trying to sell you a whole supermarket shelf full of different brands of air. “Would you like Platinum brand air? Gold brand?” “No, I just want air! I need to breathe!”