Krugman Offers Reality Check to Delusional Obamacare Doomsdayers
Paul Krugman admits in Monday's column that some bad news about Obamacare has finally come. He also says it is not surpirising. What is happening definitely is not is the "death spiral" that Obama's political enemies fervently hoped for. After two years of unexpected success, and a huge drop in the number of uninsured Americans, "Obamacare has hit a few rough patches," he writes. But they should not be exaggerated. "Health reform is still a huge success story."
But here's the bad news, per Krugman:
First, premiums are going up for next year, because insurers are finding that their risk pool is somewhat sicker and hence more expensive than they expected. There’s a lot of variation across states, but the average increase will be around 11 percent. That’s a slight disappointment, but it’s not shocking, given both the good news of the previous two years and the long-term tendency of insurance premiums to rise 5-10 percent a year.
Second, some Americans who bought low-cost insurance plans have been unpleasantly surprised by high deductibles. This is a real issue, but it shouldn’t be exaggerated. All allowed plans cover preventive services without a deductible, and many plans cover other health services as well. Furthermore, additional financial aid is available to lower-income families to help cover such gaps. Some people may not know about these mitigating factors — that’s the problem with a fairly complex system — but awareness should improve over time.
Finally, UnitedHealth Group made a splash by announcing that it is losing money on the policies it sells on the Obamacare exchanges, and is considering withdrawing from the market after next year. There were some puzzling things about the announcement, leading to speculation about ulterior motives, but the main thing to realize is that UnitedHealth, while a huge provider of employment-based insurance, is actually a fairly small player in this market, and that other players are sounding much more positive.
Oh, and official projections now say that fewer people will enroll in those exchanges than previously predicted. But the main reason is that surprisingly few employers are dropping coverage; overall projections for the number of uninsured Americans still look pretty good.
Having acknowledged the problems, Krugman concludes that news of Obamacare's demise has been greatly exaggerated, and that bumps were bound to present themselves. Of course, the peddlers of disaster scenarios are bound to be prematurely celebrating.