HealthCare.gov’s problems don’t mean Obamacare will fail

December 9, 2013

The first two months of Obamacare created a rare convergence between supporters and opponents of the law: Everyone agreed that the rollout was a disaster. The consensus reached all the way up to President Obama himself, who went so far as to list the "poor execution on my administration’s part" alongside the GOP's "reckless shutdown" as reasons that "frustrations with Washington are at an all-time high." It was like an Obamacare miracle.

(Photo by Mike Segar /Reuters)
(Photo by Mike Segar /Reuters)

But with HealthCare.gov improving, the convergence is ending. For Obamacare's supporters, the IT problems really were IT problems. Now that the Web site is working the law will likely work, too.

For Obamacare's critics, however, the problems with Healthcare.Gov confirmed that Obamacare was a top-to-bottom train wreck. The Web site's improvements -- if they're even real -- will simply give way to new, and probably worse, problems with the law.

Ross Douthat tries to chart a middle way in the New York Times. He cites polling showing that Obamacare's poor rollout pounded the law's standing among millennials and concludes that "the political emotions stirred up by the rollout — frustration, disillusionment, anger — could have substantial consequences for sign-up rates as well." If those young people don't sign up the law will fail.

Past experience with these kinds of laws -- namely, the Massachusetts health reforms and Medicare Part D -- suggests that enrollment begins as a trickle and spikes at the end, when the various penalties come into play. Douthat dismisses the Massachusetts experiences as "a bipartisan bill passed in a wealthy, homogeneous state with a pervasive left-liberal ethos." It doesn't tell us much about Obamacare, which is entering "a much more polarized, fragmented, socioeconomically diverse and libertarian-minded society."

Medicare Part D is left off this list, as often happens. But it's the more direct comparison. It, too, was a polarizing national law that suffered from a terrible rollout. At launch, it was less popular even than Obamacare. In May 2006 -- so, five months after its launch -- a CBS/New York Times poll found 48 percent of seniors said they didn't plan to join and 81 percent said the George W. Bush administration should extend the deadlines. A Gallup poll from about the same time showed 53 percent of seniors thought the law flatly wasn't working.

But the program didn't fail. Mark McClellan, who led the rollout effort, recalls that "by the spring of 2006 most seniors signed up. Every senior had heard about this program or knew people in it. And everyone was familiar with the delayed enrollment penalty. Those things together led to a big bump before open enrollment ended." Today Medicare Part D is widely considered a success. Over 90 percent of seniors say they're happy with it.

Which is all to say that the two closest analogues to Obamacare both worked. One of them worked in pretty much the same circumstance as Obamacare is facing. That's information worth taking seriously.

HealthCare.gov's problems gave people who wanted to believe Obamacare would fail license to be much more certain than they'd been before. It gave Democrats up for reelection in 2014 reason to fear for their jobs. But if you're worried about the law rather than the midterm election, Obamacare has at least three years to prove itself -- three years in which insurers will be spending hundreds of millions of dollars trying to sign people up, premiums will remain pretty stable even if early enrollment is weak, and people will be paying up to 2.5 percent of their adjusted taxable income if they refuse to buy health insurance.

I wouldn't bet very much money that Obamacare's exchanges are insuring a diverse risk pool composed of seven million souls by the end of 2014. And, politically, it seems likely that the cost for Democrats of achieving a near-universal health-care system will be the loss of two separate midterm elections. But the disaster of HealthCare.gov has been extrapolated to the whole law in a way that isn't backed by historical experience -- and that in fact requires that we dismiss historical experience.

Which is all to say that now that the Obamacare convergence is over people who thought the law would work once again think it will work and people who thought the law would fail once again think it will fail.

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Brad Plumer | December 9, 2013