Obamacare math does not add up

Published on Friday, 3 January 2014 23:08 - Written by

The Washington Post very often has a keen grasp of the obvious. In an editorial published on Thursday, that newspaper stated what everyone, everywhere knows (or should know): “Obamacare needs more enrollees to work well.”

What’s interesting about the piece is that it’s an opinion editorial — usually a vehicle for influencing opinion, not declaring obvious facts. And a closer read shows the editorial is an acknowledgement that the whole system could topple.

“It’s still unclear how well the Affordable Care Act will function,” the Post’s editorial board acknowledges. “But on Wednesday, the law started working for a good chunk of those it was designed to help. The formerly uninsured who signed up for health-care plans under its provisions are now able to use their new coverage. As The Post’s Lena H. Sun and Amy Goldstein reported Sunday, those people include Illinois financial consultant Adam Peterson, 50, who will be able to get long-needed gallbladder surgery, and Tennessee student Emily Wright, 28, who can have a specialist look at a suspicious mole.”

The new system is already in trouble, however. Only about a million people signed up through Healthcare.gov (which means they’re paying for their insurance, while 4 million have signed up for expanded Medicaid (which means they’re not paying premiums).

Those numbers are a slow-motion disaster.

“Consequently, the overriding task is to increase enrollment, particularly among target populations,” the editorial reads. “That’s not only for the well-being of those who will get coverage but also because insurers need enough healthy people paying into the system to offset the costs of the sick. They based their 2014 offerings and premiums on estimates of what that balance would look like; if the estimates fail to match reality, financing the system could be a challenge.”

Let’s break that paragraph down. What are the “target populations”? Young people, healthy people. They need to enroll and pay into the system to balance out the older, sicker Americans who are all too willing to sign up.

The real meat of that paragraph is the obvious conclusion. If not enough well people sign up, “financing the system” won’t just be a challenge. It will be impossible.

Signing up is a hassle, the editorial admits. Many people who have tried have failed and are now without coverage (sometimes unknowingly). Others don’t like what the law has done to the insurance they were already happy with.

“Those who have to pay more for insurance or take a cut in benefits — not everyone will win in a coverage expansion of this size — will be angry,” the Post admits.

What’s important here is that it’s the Washington Post saying these things, albeit in a context of supporting Obamacare. Until now, most of the law’s supporters have stuck to the too-rosy predictions and estimates cooked up by the Obama administration.

Whenever someone has questioned those estimates, the administration and many in the media have bashed the skeptic for “playing politics.”

But now even the Washington Post’s editorial board has to admit the truth. The math doesn’t work.