Because most philosophies that frown on reproduction don't survive.

Tuesday, March 23, 2010

Health Care Predictions

In the debate over the now-passed health care reform bill, a great number of statistics were brought out as to why the US desperately needed a bill like this: Numbers of bankruptcies supposedly caused by high medical costs and lack of insurance. Numbers of people who supposedly died each year because of lacking health insurance. Infant mortality rates, etc. With the bill now passed, Megan McArdle is curious to see those who supported it make some firm commitments as to what the results will be over the next five years:
1) Ezra Klein is confidently predicting that it will save hundreds of thousands of lives.
2) Nick Kristoff expects miraculous improvement in our national life expectancy.
3) Michael Moore thinks this will stop people from getting thrown out of their homes in a Medical bankruptcy.
4) At least one of you must be willing to claim massive improvements in infant mortality, after you've cited those statistics to me over and over.

These sorts of things should all be pretty easy to measure, and McArdle goes on to make her won eight predictions in regards to the effectiveness of the bill:
1) Conservatively, Ezra's arithmetic implies a reduction in the death rate of people between 18-64 of at 20,000-45,000 a year. Let's take the low bound--20,000 deaths a year--and assume that we should see that, or something close to it, by 2020. That's about 3% of deaths in the relevant age group, which would show up as a very noticeably kink in the death rate. For comparison purposes, the entire fall in mortality between 1980 and 2000 was about 2.7%.

Contra Ezra, I am predicting that this will not happen. I'm about 75% confident that you will not be able to discern any effect from the health care reform among the statistical noise. But I am 95+% confident that the effect will not be as large as 3%.

2) I'm pretty sure that Kristof read the table he was drawing from wrong--he was looking at life-expectancy at birth, but he interpreted the data as if it was about adults in the 1940s. Still, age-adjusted mortality fell about 15% in just 10 years, an achievement that hasn't been matched since. If Kristof is right, and this had more to do with health care access than antibiotics, we should be able to get a similar improvement this time around--especially since we're already seeing terrific reductions, with a 10% decline in age-related mortality just between 2001-6. Hell, both Ezra's numbers and Kristoff's imply that we should be able to knock down the death rate by at least 20% between 2014 and 2024, when we add their improvements to the existing trend.

I do not think that there will be a noticeable kink in the trend line around 2014. The death rate jumps around quite a lot, so there may be a big drop (or increase) in 2014, neither of which would be meaningful. By 2025, however, I'm skeptical that we'll see a major inflection in the trend.

3) David Himmelstein claims to believe that the majority of all bankruptcies are related to medical issues, and that this is a strong argument for national health care . . . i.e., he claims to believe that medical bills rather than income loss are the main causal driver here. That's the data Michael Moore is citing. I will make a bold counterclaim: the bankruptcy rate after 2014 will not fall by half. It won't even fall by a quarter. This is among the easiest effects to measure, as if the people citing these statistics are right, we should see a sharp and immediate reduction in bankruptcy rates in the first year, with the full effects evident by 2018.

4) Infant mortality should be no greater than that of the Netherlands by 2018. Again, I predict that this will not happen, and indeed, that infant mortality rates may not fall at all.

[read the rest]
Somehow, however, no one seems eager to take up this task from the other side. Indeed, Ezra Klein writes to McArdle insisting that he not be pinned down to having predicted any measurable results for the bill.

Of course, this is partly the result of the traditional political tides: Before a bill passes, supporters promise the moon if it passes. After is passes, they start under-promising in an effort to make sure that they don't get caught with "it didn't work" accusations during the next round of elections. Of course, all this is made even trickier when the authors of a bill intentionally frame it so that it doesn't take effect until after two more election cycles, thus taking advantage of the collective ADD of the American voting public. Democrats may have believed that the bill would save tens of thousands of lives a year, but they didn't believe it enough to want to save those lives between now and 2014 more than they wanted to be spared the effort of explaining themselves in the 2010 and 2012 election cycles.

This isn't a strictly a liberal phenomenon either. Wise Republicans would be hesitant commit to any specific number for increased federal tax revenues because of a tax cut and get no more optimistic than predicting that the tax revenue trend of the previous ten years would continue over the next ten years without a noticable long term impact. Still, given that this program will become one of the top ten line items on the federal budget, it is disheartening that its supporters are not even willing to commit to its having any measurable positive effects at this point. One is left wondering, if its effects will be so small as to be lost in the statistical noise, what exactly are we getting for our $200 Billion a year (plus even more in individual and business expenditures on insurance premiums?


cliff said...

Only nine out of 136 Catholic Democratic congressman voted against the bill. Congress is exempt from what they are imposing on us.

Tausign said...

To answer you question I believe we've just purchased a right to healthcare on credit. Whether we get better healthcare outcomes is highly suspect. Keep in mind, a right to healthcare is not the same as healthcare.

Brandon said...

It's interesting to think what would happen to our politics if we all held that nobody were allowed to advocate a political policy unless they were willing to make some sort of reasonable commitment to specific criteria of success and failure for it.

Anonymous said...

The biggest effect of the bill will be economic, and it will be the result of something that takes effect immediately: Insurance companies may no longer deny coverage based on preexisting conditions. This means, for example, that my diabetic uncle is no longer trapped in the job that he hates, and can now move to a new job better suited to his skills, confident that he will not lose health coverage by doing so.

Multiply this by several million people, and you will see an uptick in worker productivity across the US.


Darwin said...


Well, except that the guaranteed issue is pretty much only affecting individual policies, not employer ones. While there may be differences state to state that I'm not aware of (my experience is all in California and Texas) it's already the case that you get health care coverage at your new employer regardless of any existing conditions.

geeklady said...

I'll give you a prediction for free.

I have myopic degeneration - this is a condition with abnormal blood vessel growth that distorted my macula, caused blood to leak into my eye. This caused a focal blind spot and without immediate treatment could damage the photoreceptors of my retina and leave me blind. Essentially it is wet macular degeneration in one under 50. Despite the etiology being identical to wet macular degeneration, and despite substantial evidence in the literature that wet macular degeneration treatment is highly successful, there's no FDA approved treatment and my insurance consequently refused to pay a dime to preserve my eyesight.

I paid for my entire treatment myself: four injections of avastin into the vitreous humor of the eye. Pricy at three hundred dollars a procedure, but manageable, and as it restored my vision to 25/20, completely worth it. I still require monthly following and may require additional injections.

So here's my prediction. If I require another course of avastin injections in five years time, I predict I will be unable to afford it.

Anonymous said...

darwin wrote: "it's already the case that you get health care coverage at your new employer regardless of any existing conditions."

You might want to double-check that.


Darwin said...

Well, in our case, we have a pre-existing condition in the family which had resulted in us being turned down for individual health insurance in the past. However, both companies I worked for (in Texas) since the condition came up (in California) we've had no problem at all with coverage. If you work for the company, you get full coverage and it just affects the company risk pool.

In fact, I even know a couple people at my company who specifically got jobs there in order to get coverage for a spouse or kid who had an expensive medical condition.

My folks dealt with pre-existing condition issues (including cancer) while switching insurance carriers (though not jobs) in California, and from what they told me at the time so long as you maintained some sort of coverage at all times all conditions continued to be covered. I know they were concerned that if they allowed coverage to lapse, they might get things labelled and pre-existing conditions, but simply changing carriers was not a problem.

Again, it may varry by state, but although I know people in half a dozen states with some sort of continuing medical issues, none of them that I'm aware of are unable to change jobs because of not being covered at the new job -- though some do very specifically consider the type of coverage offered by the new employer (perhaps even more than the salary) when picking jobs as a result.

The guaranteed issue provisions in the current health care bill are strictly in regareds to people not covered at work.

Anonymous said...

"some do very specifically consider the type of coverage offered by the new employer (perhaps even more than the salary) when picking jobs"

Bingo. This is what will change.


Darwin said...

Why would that change? Health benefits are a form of compensation, one which some companies offer more of than others, and some employees care about more than others. (Which is why, for instance, union workers didn't want their "cadillac plans" taxed.)

There's no particular reason to believe that employers will all start offering the same coverage, or that employees will stop caring about what kind of coverage employers offer.

Beate said...

Actually, health care coverage can still be denied by individual companies - even for children. What parents can do, is purchase a high risk policy. As if that would be affordable! Yup, they back-pedalled on that promise immediately after the bill was signed.