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As often happens, the prospect of reform has led to a sudden eruption of affection for the health-care status quo. The airwaves are alive with impassioned protests against the idea that anyone might change a market that relies on discriminating against the old, the sick, the female, and people who don't read the fine print of insurance policies. This is the best health care in the world, you know.
The Commonwealth Fund's latest survey of international health systems stands as a refreshing reality check. Their data compares the U.S. to Australia, Canada, France, Germany, the Netherlands, New Zealand, Norway, Sweden, and the United Kingdom on a host of health-system measures, both objective (like diabetes amputations) and subjective (like satisfaction). The results are a reminder of why reform is so badly needed.
Start with cost. Americans spend 17.7 percent of GDP on health care. No one else spends even 12 percent. Let's make that more concrete: If Americans only spent 12 percent of GDP on health care we would have saved $893 billion in 2012.
The reason isn't that Americans get more health care than anyone else. We have more uninsured than anyone else. We have fewer physicians per capita than anyone but the Japanese. We go to the doctor less often than anyone but the Swiss. We don't have more hospital beds than other developed countries, and when we do go to the hospital, we don't stay longer.
But we do pay more for the privilege. The average hospital stay costs more than $21,000 in the U.S. It costs only $8,363 in France. (See "Why an MRI costs $1,080 in America and $280 in France".) Administrative costs in the U.S. are more than three times higher than in most nations with universal health-care systems.
Nor do we receive better, swifter, or more flexible service. For all the talk of waiting lines in foreign countries, America is second only to Canada in the number of adults reporting difficulty getting a next-day appointment when they're sick. Americans also find it unusually difficult to get after-hours care, and by a wide margin, Americans are more likely than residents of any other developed country to report that cost is a barrier to getting health care. Oh, and Americans are more likely to report being the victim of a medical error.
There are some bright spots for the American medical system. Residents of the U.S. find it easy to get quick appointments with specialists, and only citizens of France, Germany, the Netherlands, and Switzerland report that they can get schedule elective surgeries as rapidly.
The data on quality, however, is more mixed. Americans lead the world in five-year survival for breast cancer. But we lag competitor nations on diabetes amputations. And we're only middle-of-the-pack on surviving myocardial infractions (a common kind of heart attack).
This is, to say the least, a pretty poor performance for a health-care system that costs so much more than any other. And it shows up in public surveys. Only 29 percent of Americans say the health-care system works well and only minor changes are necessary. That's lower than anywhere save Australia. Meanwhile, 29 percent say the system needs to be completely rebuilt. That's higher than anywhere else in the survey, period.
Change is painful. But the status quo is a disaster.
Wonkbook's Number of the Day: 1.3 million. That's how many people will lose their unemployment benefits in the last week of December, when the federal emergency extension expires.
Wonkbook's Graph of the Day: Everything you need to know about the Obamacare “fix” in one flowchart.
Wonkbook's Top 5 Stories: (1) low expectations for Healthcare.gov; (2) what if things never get better?; (3) does the NSA like the taste of backlash?; (4) bringing back the nuclear-option DEFCON; and (5) gay marriage's finish line.
1. Top story: Healthcare.gov just wants to be a B-student
HealthCare.gov goal is for 80 percent of users to be able to enroll for insurance. "The Obama administration will consider the new federal insurance marketplace a success if 80 percent of users can buy health-care plans online, according to government and industry officials familiar with the project. The goal for how many people should be able to make it through the insurance exchange is an internal target that administration officials have not made public...The measure is the first concrete performance standard in the 31/2 years since the government began to design the health exchange, and was defined by a group of federal officials and technical experts in late October." Amy Goldstein and Juliet Eilperin in The Washington Post.
High-risk patients fuel more worries about Obamacare's launch. "[I]n a sign of the uncertainty created by the health-law rollout, some states are taking a second look and considering extending their pools' lives. Such extensions could cost taxpayers money since some states contribute to the cost. In other states, insurers fund a large portion...The federal government also has indicated it hasn't ruled out extending a separate program it oversees for about 100,000 high-risk people across the country. It was slated to close at the end of this year." Louise Radnofsky in The Wall Street Journal.
@JohnJHarwood: What Obamacare opponents rarely acknowledge: insurance "cancellation" letter does NOT mean recipient can't buy insurance. Before ACA, it did
How states are deciding whether to accept Obama’s cancellation ‘fix.’ "The whole point of the health-care law was to eliminate insurance plans that didn't offer robust enough coverage. Giving these plans another year on the market would be a step backward from that policy goal -- not to mention a logistical nightmare. There's definitely a policy debate to be had over whether it's a good idea to eliminate skimpier insurance products. But there's not much argument about whether that was the idea behind the health-care law. The wave of insurance cancellations happening right now is a feature of the law; not a bug." Sarah Kliff in The Washington Post.
Explainer: Here’s where your state stands on Obama’s cancellation fix. Sarah Kliff and Lena H. Sun in The Washington Post.
Obamacare fix could add millions of dollars in government costs. "This is due to a provision of the Affordable Care Act called risk corridors that allows for insurers to share the cost of insuring more expensive customers...There's no good estimate yet as to how much the government's share may be, but a rough calculation from the Kaiser Family Foundation said the difference could be tens of millions or even hundreds of millions of dollars." Adam Aigner-Treworgy in CNN.
Obamacare is having one huge success nobody knows about. "The publicity around the new health-care law has led a lot of those people to inquire about whether they're eligible for health insurance -- and they're finding out that they are. The clearest example of this is in the red states that aren't participating in the law's Medicaid expansion: There, 91,000 people have tried to sign up for health insurance and learned, in the process, that they are already eligible for Medicaid coverage." Ezra Klein in The Washington Post.
Congress: We have so much to do...ooh, look, Obamacare! "Prospects already were dim for substantial legislation in the dwindling days of 2013, but the headline-grabbing fights over the federal health exchange and canceled insurance policies have given House Republicans no incentive to change the subject. The issue has drowned out talk of an immigration overhaul, taken the focus off high-stakes budget talks and stalled efforts to rewrite the tax code." Kristina Peterson and John D. McKinnon in The Wall Street Journal.
@MichaelRStrain: It is *painful* to hear pundits claim that "conservatives" don't have an Obamacare alternative. Conservative intellectuals do; pols don't.
HealthCare.gov gets new spokesman. "Former House Democratic staffer Aaron Albright is joining the Centers for Medicare and Medicaid Services as director of media relations on Monday, a source said. Albright confirmed to POLITICO that he has taken the job. Emails to Brian Cook, the person currently listed as CMS’s director of media relations, bounce back. He's making a long-planned move to New York with his fiance." Jennifer Epstein in Politico.
Interview: Mike Kreidler, Washington's insurance regulator who turned down Obama's Obamacare fix. Sarah Kliff in The Washington Post.
D.C. just fired its insurance commissioner. "The insurance commissioner for the District of Columbia was dismissed from his job just a day after he publicly questioned a decision by President Obama to reverse a provision of the Affordable Care Act, a person with knowledge of the events said on Sunday. This person said that the commissioner, William P. White, had requested but never received permission from the office of Mayor Vincent C. Gray to publish a critique of Mr. Obama’s surprise announcement on Thursday that he would allow thousands of Americans to renew policies that might not provide the minimum coverage required by the health law. Instead of waiting to hear from Mr. Gray’s office, the person said, Mr. White’s office posted the statement on the city government’s website less than 15 minutes after sending an email seeking approval. Later, when confronted by the mayor, Mr. White said he had received permission from the mayor’s staff even though he had not, the person said." Susanne Craig and Michael D. Shear in The New York Times.
Tennessee's governor is hesitating to expand Medicaid. "[Bill] Haslam, who had once promised a decision by summer’s end, is still trying to negotiate a new plan of his own with federal officials, hoping it will satisfy the competing constituencies. It would involve using federal money to place many of the state’s poor on the federal health care exchange created by the act, rather than on Medicaid. But so far he has not persuaded federal officials, who have asked for more details, and said he expected no quick resolution. Although he is not required to do so, Mr. Haslam has also promised not to enact anything without the approval of the Legislature, whose Republican majority, he said, was dead set against an expansion of Medicaid. Support for his alternative plan seems uncertain at best." Rick Lyman in The New York Times.
Explainer: Local coverage of Obamacare has been brutal. Andrew Kaczynski in BuzzFeed.
The lesson of Medicare in 1989. "The year was 1989, and the law was the Medicare Catastrophic Coverage Act, which was supposed to protect older Americans from bankruptcy due to medical bills. Instead it became a catastrophe for Democratic and Republican lawmakers, who learned the hard way that many older Americans did not want to be helped in that particular way...The tortured history of the catastrophic-care law is a cautionary tale in the context of the struggle over the new health law, the Affordable Care Act. It illustrates the political and policy hazards of presenting sweeping health system changes to consumers who might not be prepared for them. And it provides a rare example of lawmakers who were willing to jettison a big piece of social policy legislation when the political risks became too grave." Carl Hulse in The New York Times.
@KipPiper: Cost sharing subsidies in Obamacare exchange plans are subject to 2014 sequester (~ 7.2% cut). Premium subsidies exempt.
What the Democratic leadership is telling itself. "House Minority Leader Nancy Pelosi (D-Calif.) sought Sunday to downplay the impact of the 39 House Democrats who broke ranks to vote for a Republican bill that would alter the federal health-care law, as one of her top lieutenants said most of the defectors were trying to "insulate" themselves...Still, Friday's vote was a striking show of Democratic disunity and the largest Democratic defection on a major piece of legislation this year." Sean Sullivan in The Washington Post.
Health-care law has changed game for Democrats looking to 2014 election. "The recent debacle over HealthCare.gov’s rollout may have narrowed whatever perceived advantages Democratic candidates may have had over Republican opponents. In some minds, the health-care law’s flubs have merged with the government shutdown to render an unfavorable verdict on all of Washington." Ed O'Keefe and Paul Kane in The Washington Post.
DOUTHAT: Three burials of Obamacare. "[W]hat’s going on right now, the convergence of the website’s technical problems with the backlash surrounding canceled plans, reveals the perils of trying to outsmart the political system’s status quo bias. Your strategy can end up so intricate and deceptive, and your policy so complex and jerry-built, that something as basic as a malfunctioning website can suffice to bring the whole policy crashing down." Ross Douthat in The New York Times.
KINSLEY: Obamacare's losers, or trying to get something for nothing. "What did people think when they heard President Obama say that no one would have to give up their current health care arrangements if they preferred to keep them? This is not to excuse Obama, but anyone who knew anything at all about the two-year-long debate about health care reform should have known that what he said wasn’t true...Hillarycare faltered and Obamacare is faltering because people are dishonest to themselves about change. They say they want it—they express outrage that they don’t have it—but when they’re threatened with it, they curl up into a ball and tell it to go away." Michael Kinsley in The New Republic.
CARNEY: Blame and subsidize. "In waiving the part of Obamacare that outlaws many insurance plans, Obama tried to shift blame for any cancellations to the insurers. But on Friday, he met with representatives from these same companies, sparking speculation that he had plans to offer them subsidies to help smooth Obamacare's rocky rollout. This seeming schizophrenia is standard fare in the love-hate relationship between Obama and the insurers." Timothy P. Carney in The Washington Examiner.
Music recommendations interlude: M. Ward, "Chinese Translation."
KRUGMAN: A permanent slump? "[Larry] Summers went on to draw a remarkable moral: We have, he suggested, an economy whose normal condition is one of inadequate demand — of at least mild depression — and which only gets anywhere close to full employment when it is being buoyed by bubbles." Paul Krugman in The New York Times.
SCHEIBER: The problem with Geithner's new job. "Geithner’s choice of post-government career isn’t shameful—there are plenty of upstanding, well-intentioned people who work in finance. And it’s obviously perfectly legal. What it is, to be blunt, is corrosive. There are any number of organizations that could benefit from Geithner’s managerial talents and A-list Rolodex. If you didn’t know how the world worked, you’d have no reason to assume that a large, profitable financial firm had a special claim on these assets. But, of course, we all do know how the world works. It’s hard to come up with a senior economic official who didn’t cash out in the financial sector shortly after leaving government. Every time another one does, it every-so-slightly reinforces our conviction that the game really is rigged. Geithner, with his unusually prominent role and his pretensions to lifelong service, has reinforced that conviction a bit more than most." Noam Scheiber in The New Republic.
SUROWEICKI: Gross domestic freebie. "Our main yardstick for the health of the economy is G.D.P. growth, a concept devised in the nineteen-thirties by the economist Simon Kuznets. If it’s rising briskly, we know that the economy is doing well. If not, we know it’s time to worry. The basic assumption is simple: the more stuff we’re producing for sale, the better off we are. In the industrial age, this was a reasonable assumption, but in the digital economy that picture gets a lot fuzzier, since so much of what’s being produced is available free. You may think that Wikipedia, Twitter, Snapchat, Google Maps, and so on are valuable. But, as far as G.D.P. is concerned, they barely exist." James Suroweicki in The New Yorker.
LUCE: Obama is failing. "[C]onsider Mr Obama’s second term record to date. With the exception of having stared down Republicans last month over their threat of a default, he has fallen at almost every hurdle. This year began with attempts to impose tougher checks on gun buyers following the massacre of 20 infants in a Connecticut school. When the initiative began to falter, Mr Obama put his authority on the line. The bill was defeated. It has been much the same ever since, from his request for authority to strike Syria to prospects of a fiscal deal. Talk of an initiative on climate change is a memory." Edward Luce in The Financial Times.
COWEN: More freedom on airplanes, if nowhere else. "Our new Kindle freedoms, however minor they may seem, show how hard it is to clear away the old, unnecessary regulations that are impeding the economy...The point isn’t that we should eliminate all regulation or give up on clean air and water. In fact, we may need tougher guidelines — albeit simpler ones — to govern what is permissible for activities like financial risk-taking or burning coal. Still, a paring back of regulation in many areas, based on clearer priorities, seems in order." Tyler Cowen in The New York Times.
VINIK: The case for a basic income. "The clear [benefit] is that no American would live below the poverty line. The U.S. has been waging the War on Poverty for a generation now and still nearly 50 million Americans are below the line. This would end that war with a decisive victory. There are knock on effects as well. Americans would have greater leverage to demand higher wages and better working conditions from their employer thanks to the increased income security. Families could allow one parent to take time off to raise their kids. Eliminating the numerous different government welfare programs would also lead to efficiency gains as adults would simply receive their check in the mail and not have to waste time filling out paperwork at numerous different offices." Danny Vinik in Business Insider.
STIGLITZ: The insanity of our food policy. "The nonsensical arrangement being proposed in the House Republicans’ farm bill is an especially egregious version of this process. It takes real money, money that is necessary for bare survival, from the poorest Americans, and gives it to a small group of the undeserving rich, in return for their campaign contributions and political support. There is no economic justification: The bill actually distorts our economy by promoting the kind of production we don’t need and shrinking the consumption of those with the smallest incomes. There is no moral justification either: It actually increases misery and precariousness of daily life for millions of Americans." Joseph E. Stiglitz in The New York Times.
DIONNE: A more benevolent nation? "Over the last three decades, we have made great strides in battling lawlessness. Because of this, we are less inclined to insist on retributive justice. We are more open to reforming prisons, criminal sentencing and policing itself. And many more of us are opposed to the death penalty." E.J. Dionne in The Washington Post.
Aaron Carroll schools us all interlude: In this awesome video, he explains the science behind the HPV vaccine.
2. What if things never get better? Today in depressing thoughts.
Meet the Americans who are caught in a revolving door of unemployment. "[J]oblessness itself has become a trap, an impediment to finding a job. Economists see it the same way, concerned that joblessness lasting more than six months is a major factor preventing people from getting rehired, with potentially grave consequences for tens of millions of Americans...The unemployment rate has fallen to 7.3 percent, down from 10 percent four years ago. Private businesses have added about 7.6 million positions over the same period. But while recent numbers show that there are about as many people unemployed for short periods as in 2007 — before the crisis hit — they also show that long-term joblessness is up 213 percent." Annie Lowrey in The New York Times.
Women reach a milestone in the labor market. "A record 67.5 million women are working today, up from the prior peak of 67.4 million in early 2008, according to the Labor Department's latest tally of payrolls that captured the full rebound for the first time. By comparison, 69 million men currently have jobs, below their high of 70.9 million in June 2007." Jonathan House in The Wall Street Journal.
Goodbye, emergency unemployment insurance. "Unless Congress acts, during the last week of December an estimated 1.3 million people will lose access to an emergency program providing them with additional weeks of jobless benefits. A further 850,000 will be denied benefits in the first quarter of 2014...In all, as many as 4.8 million people could be affected by expiring unemployment benefits through 2014, estimated Gene Sperling, President Obama’s top economic adviser." Annie Lowrey in The New York Times.
Tim Geithner is joining a private-equity firm. "Timothy F. Geithner will join the private equity firm Warburg Pincus as president, the firm announced on Saturday. It would be his first prominent position since leaving office as Treasury secretary this year...While Mr. Geithner has been given the lofty title of president, several private equity executives questioned whether he would be much more than a prominent name who would help Warburg Pincus open doors on the fund-raising side, especially with foreign investors like sovereign wealth funds." Michael J. de la Merced in The New York Times.
The Fed may delay the Volcker rule. "The Federal Reserve is considering a delay in the compliance date for the highly anticipated Volcker regulation, giving banks additional time to conform with its provisions, according to people familiar with the matter...It is considering pushing out the timing to July 2015 to allow for a phased-in period of implementation, people familiar with the matter said." Gina Chon in The Financial Times.
CFTC to shake up US swaps trading market. "New guidance from the main US regulator of privately negotiated derivatives is set to test the business models of interdealer brokers, who have long played a crucial intermediary role between global banks. For interdealer brokers, the latest CFTC guidance means they must open up their trading platforms beyond the small club of powerful dealers who dominate the interdealer market." Michael MacKenzie, Gina Chon, and Philip Stafford in The Financial Times.
The missing story of Lars Peter Hansen. "The Nobel committee recognized Professor Hansen this year for developing a statistical technique, the generalized method of moments. He described it as “a method that allows you to do something without having to do everything...The science of economic model-building is very much a work in progress, he said. “The thing to remember about models is they’re always approximations and they will always turn out to be wrong,” he said. That shouldn’t be a surprise, he said, and it doesn’t mean that the models are useless. “You need to ask, are the models wrong in ways that are central to the questions you want to ask, or are they wrong in ways that aren’t so central?”" Jeff Sommer in The New York Times.
GE to exit retail lending, narrowing itself to industry. "General Electric Co. plans to exit the retail lending business—the conglomerate's most aggressive move yet to shrink the size of its financing arm, which still generates half its profit.plans to exit the retail lending business—the conglomerate's most aggressive move yet to shrink the size of its financing arm, which still generates half its profit...GE relies heavily on its financing businesses to fuel its profits, generate cash to buy back stock or make acquisitions, and provide sizable tax benefits. The arm, GE Capital, by itself would rank as the country's fifth-largest commercial bank. But GE is moving to reduce its lending business under pressure from shareholders, who value the company's industrial operations more highly...The lending operation has shrunk substantially in the past five years and came under tighter regulatory oversight by the Federal Reserve." Kate Linebaugh in The Wall Street Journal.
KONCZAL: Here’s what’s wrong with Rand Paul’s ‘Audit the Fed’ bill. "[M]any of the proponents of Federal Reserve transparency are simply looking for methods to advance a hard-money agenda even though inflation is dangerously low. Instead of a “transparency act,” Paul’s bill will probably be a “harassment act” in practice. Many people who support transparency in and of itself will think this is a good idea. However this bill could point transparency in the wrong direction, bringing every instrument change into question while leaving the important goal discussions on the sidelines." Mike Konczal in The Washington Post.
In memoriam interlude: Doris Lessing, Nobel laureate author.
3. Does the NSA like the taste of backlash?
NSA grapples with 988 percent increase in records requests. "Americans are inundating the National Security Agency with open-records requests, leading to a 988 percent increase in such inquiries. Anyone asking is getting a standard pre-written letter saying the NSA can neither confirm nor deny that any information has been gathered...During the first quarter of the NSA fiscal year, which went from October to December, it received 257 open-records requests. The next quarter, it received 241. However, on June 6, at the end of NSA's third fiscal quarter, news of Snowden's leaks hit the press, and the agency got 1,302 requests. In the next three months, the NSA received 2,538 requests. The spike has continued into the fall months and has overwhelmed her staff, Phillips said." Yamiche Alcindor in USA Today.
Silicon Valley is fighting back. "Google Inc., Facebook Inc. and Yahoo! Inc. are fighting back against the National Security Agency by using harder-to-crack code to shield their networks and online customer data from unauthorized U.S. spying. The companies, burned by disclosures they’ve cooperated with U.S. surveillance programs, are protecting user e-mail and social-media posts with strengthened encryption that the U.S. government says won’t be easily broken until 2030." Chris Strohm in Bloomberg.
Adorable animals returns interlude: So many golden retrievers.
4. Bringing back the nuclear-option DEFCON
The Senate is steaming towards another collision over the filibuster. "With Republicans set on Monday to block Robert Wilkins’s nomination to the D.C. Circuit Court of Appeals, both parties’ positions appear hopelessly intractable...Reid and his leadership team insist that setting up a string of votes on judges to the key court is not about forcing a change to the Senate’s rules by a majority vote — that is, implementing the so-called nuclear option. Instead, top Senate Democrats say approving new judges to three vacancies on the D.C. Circuit is just part of the chamber and President Barack Obama’s constitutional duty. But Republicans’ continued rejection of those judicial nominees means a nuclear option fight could await nonetheless." Burgess Everett in Politico.
5. When you know gay marriage is nearing the finish line
The Cheney family's private dispute over gay marriage just got very public. "The situation has deteriorated so much that the two sisters have not spoken since the summer, and the quarrel threatens to get in the way of something former Vice President Dick Cheney desperately wants — a United States Senate seat for Liz. Things erupted on Sunday when Mary Cheney, a lesbian, and her wife were at home watching “Fox News Sunday” — their usual weekend ritual. Liz Cheney appeared on the show and said that she opposed same-sex marriage, describing it as “just an area where we disagree,” referring to her sister. Taken aback and hurt, Mary Cheney took to her Facebook page to blast back: “Liz — this isn’t just an issue on which we disagree you’re just wrong — and on the wrong side of history.”" Jonathan Martin in The New York Times.
Is D.C. the gayest place in America? "Consider what surveys by Gallup and the Census Bureau have found about the gay population here. When the District of Columbia is compared with the 50 states, it has the highest percentage of adults who identify as lesbian, gay, bisexual or transgender, according to Gallup. At 10 percent, that is double the percentage in the state that ranks No. 2, Hawaii, and nearly triple the overall national average of 3.5 percent. The Census Bureau looked at where the highest percentage of same-sex couple households were and also found that the District of Columbia ranked far higher than the 50 states, with 4 percent. The national average is just under 1 percent." Jeremy W. Peters in The New York Times.
Reading material interlude: The best sentences Wonkblog read today.
Here’s what’s wrong with Rand Paul’s ‘Audit the Fed’ bill. Mike Konczal.
Longread: Washington State discovers that it’s not so easy to create a legal marijuana economy. Patrick Radden Keefe in The New Yorker.
The GOP's "Agenda 2014" is literally blank. Jake Sherman and John Bresnahan in Politico.
Meanwhile in foreign policy, the U.S. may soon begin training Libyan security forces. Julian E. Barnes in The Wall Street Journal.
Immigrant rules to be relaxed for military kin. Miriam Jordan in The Wall Street Journal.
Wonkbook is produced with help from Michelle Williams.