Obamacare: the tyranny of choice 

My mom and I had a good catchup yesterday, and among the topics was health care.  As a newly-minted UK citizen, I’ve lived in the country long enough to have my concern/interest in health care take a back back back seat.  Alas, for my family continuing to live in the US, it’s just not an option.

Many questions, many choices, much confusion.  Source: enrollmissouri.org

Many questions, many choices, much confusion. Source: enrollmissouri.org

Speaking of options: I just perused the Missouri ‘health care marketplace‘, to see how far insurance has come since the very contentious legislation. Some thoughts:

  • For anyone interested in how much health care costs for Americans, consider this spreadsheet from the website.  Some explanation is required, so use the earlier link to hear the differences in tiers.
  • First impression: OH MY GOD THE AMOUNT OF CHOICE IS RIDICULOUS.
    • I’m reminded of buying peanut butter when I first came to the UK: at first I was near-horrified there were only about 5 choices of peanut butter at the grocery store; how do people live without so much choice?  Now?  I’m plenty happy to have that many choices…peanut butter just kinda works.
    • Following from the above: my naive impression is that the ultimate criterion for useful health insurance is just like peanut butter.  Does it work?  If it does, great.  I couldn’t care less which insurance provider it is, for example.
    • Given this is a health exchange, all the plans are meant to fit very specific criteria about what can be offered.  Somehow this still involves different pricing among many variables, including the country one resides within the state.  Really?
  • Second impression: how can any reasonable person be expected to make an optimal choice?  Mom found the site confusing, and she’s a smarty pants.  It’s like the site was designed to encourage normal folks to hire ‘navigators’.  Sound familiar?  I’ll give you a hint: the US tax system encourages exactly the same thing.  
  • Third impression: it’s a shame Obamacare was watered down so much.  
    • The huge amount of ‘choice’ looks to me like a ruse for price discrimination writ large.  +1 for the lobbyists.  Optically separating the risk pools for insurance will probably also keep premiums high, maintaining profits for private insurers.
    • My understanding of insurance is that the larger the risk pool, the cheaper the cost of insurance provision.  That’s the reason for the much-hated ‘mandate’ Obamacare places on supposedly healthy (but taxpayer-unfriendly) young folks choosing to only use the emergency room for health care.  By having all these different providers, risk pools stay small.  Costs can’t come down.
  • Final impression: it’s still a step in the right direction.

In sum: I had very high hopes for Obamacare as initially proposed.  Its move towards a single-payer model (which seems to work in every other developed country) is the right call to lower costs.  But no: as with many things, the final legislation seems to have kept all the unpalatable bits (e.g. the ‘mandate’) without the clearly beneficial bits (e.g. single-payer, very small number of options to ease choice and maximise risk pools).  My big hope for the future is to see Obamacare continue to succeed; consolidation among providers; and eventual phasing out of the private market for primary insurance.

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