Economic Impact of the ACA real and imaginary

[william the wie]

The ACA will have some real negative impacts:

Fines for non-compliance

Recapture of over payment of subsidies.

Then there are questionable attributions of blame:

Migration patterns attributed to ACA. For example many people will flee CA in the coming years. Some migration will be due to drought, some to taxes and other various non-ACA issues. Some migration will be due to ACA issues.

Inflation, recession, increased automation or the continuing loss of jobs and GDP in most of the west coast and northeast to more Republican areas. All of these possible scenarios have their roots in lower state taxes and regulatory burden in Red states and higher in Blue states. Inflation will have more impact in blue states due to higher tax and regulatory burden. Likewise recession and increased automation will have skewed effects.

So, the GOP gets its wish takes power and finds out that there is no reset button on ACA. The status quo antebellum is gone and correcting real negative ACA impact will have no effect whatever on imagined/falsely attributed bad news about ACA. So, what happens when this reality is confronted?

 

[emilynghiem]

The ACA will have some real negative impacts:

Fines for non-compliance

Recapture of over payment of subsidies.

Then there are questionable attributions of blame:

Migration patterns attributed to ACA. For example many people will flee CA in the coming years. Some migration will be due to drought, some to taxes and other various non-ACA issues. Some migration will be due to ACA issues.

Inflation, recession, increased automation or the continuing loss of jobs and GDP in most of the west coast and northeast to more Republican areas. All of these possible scenarios have their roots in lower state taxes and regulatory burden in Red states and higher in Blue states. Inflation will have more impact in blue states due to higher tax and regulatory burden. Likewise recession and increased automation will have skewed effects.

So, the GOP gets its wish takes power and finds out that there is no reset button on ACA. The status quo antebellum is gone and correcting real negative ACA impact will have no effect whatever on imagined/falsely attributed bad news about ACA. So, what happens when this reality is confronted?

People will have to do what should have been done in the first place.
Pursue health care reforms by addressing the demand and the supply of actual
medical services to make this cost effective. not play with insurance or mandates.

Democrats argued for years that making laws to regulate abortion doesn't solve
the problem but makes it worse. they proceeded to FU health care trying to legislate it.

I predict that true health care reform will come from addressing criminal justice,
immigration and education issues. when we redirect resources toward medical
education and services, and quit wasting on the cost of crime and disease after
the fact, better preventative and correctional programs will cover more people
with the money currently overspent by state budgets on failed jails and welfare.

 

[william the wie]

I come at this problem from a different angle. I think the ACA is a sign of market capitulation. It was passed at the peak of effective cost. Just eliminating medical treatments of dubious efficacy such as prostate exams, mammograms, bypass and most angioplasty while fast tracking bio-tech solutions with DARPA style prize money it should be possible to drop healthcare costs relatively fast while improving outcomes.

 

[Statistikhengst]

There is no way to completely answer this on my part, for one reason to begin with:

1.) I need to do some research.


But there is actually no way for anyone to answer this, for your OP starts with a lot of assumptions, which is absolutely ok with me, but we are in the middle of a process. There is no way to know how many fines there will be and corollary, there is no way to know what kind of effect that will have on the economy - yet.

I am not saying your are wrong about most of this, though I have a strong feeling that it is going to work out far differently than you suspect. A lot of these same arguments were brought against SS in the 1936 presidential election, btw. Alf Landon, Gov. of Kansas and the GOP nominee, called SS "socialism" and said it would ruin America. After the election, in his memoirs, Alf Landon admitted that he didn't believe a bit of what he said, he only said it to prop his party up.

Now, that is not necessarily the case here, but there are some similarities.

And I will remind that for the VAST majority of US-Americans, ACA means absolutely no change at all for them.

However, I will start to research a number of things immediately and come back to this thread in exactly 14 days. I have a lot of professional projects on my plate, and researching this information is going to take time - what information is even out there, and also to test the reliability of said information.

Is that ok with you, Willliam?

 

[william the wie]

There is no way to completely answer this on my part, for one reason to begin with:

1.) I need to do some research.


But there is actually no way for anyone to answer this, for your OP starts with a lot of assumptions, which is absolutely ok with me, but we are in the middle of a process. There is no way to know how many fines there will be and corollary, there is no way to know what kind of effect that will have on the economy - yet.

I am not saying your are wrong about most of this, though I have a strong feeling that it is going to work out far differently than you suspect. A lot of these same arguments were brought against SS in the 1936 presidential election, btw. Alf Landon, Gov. of Kansas and the GOP nominee, called SS "socialism" and said it would ruin America. After the election, in his memoirs, Alf Landon admitted that he didn't believe a bit of what he said, he only said it to prop his party up.

Now, that is not necessarily the case here, but there are some similarities.

And I will remind that for the VAST majority of US-Americans, ACA means absolutely no change at all for them.

However, I will start to research a number of things immediately and come back to this thread in exactly 14 days. I have a lot of professional projects on my plate, and researching this information is going to take time - what information is even out there, and also to test the reliability of said information.

Is that ok with you, Willliam?

Certainly. The real clear markets and politics archives not to mention Bloomberg opinions and Yahoo finance are a bear and a half and that is just the icing on the top. Really hard data on the individual mandate will not be available until the summary of quarterly insurance reports are analyzed after 9/30/14, which is likely to be a real eyeopener got both sides. And there are a lot of cubbyholes like covered drugs or the lack of such coverage for serious pre-existing conditions. So, even a quick, down and dirty that's in the ballpark in 14 days will astonish me.

 

[Statistikhengst]

There is no way to completely answer this on my part, for one reason to begin with:

1.) I need to do some research.


But there is actually no way for anyone to answer this, for your OP starts with a lot of assumptions, which is absolutely ok with me, but we are in the middle of a process. There is no way to know how many fines there will be and corollary, there is no way to know what kind of effect that will have on the economy - yet.

I am not saying your are wrong about most of this, though I have a strong feeling that it is going to work out far differently than you suspect. A lot of these same arguments were brought against SS in the 1936 presidential election, btw. Alf Landon, Gov. of Kansas and the GOP nominee, called SS "socialism" and said it would ruin America. After the election, in his memoirs, Alf Landon admitted that he didn't believe a bit of what he said, he only said it to prop his party up.

Now, that is not necessarily the case here, but there are some similarities.

And I will remind that for the VAST majority of US-Americans, ACA means absolutely no change at all for them.

However, I will start to research a number of things immediately and come back to this thread in exactly 14 days. I have a lot of professional projects on my plate, and researching this information is going to take time - what information is even out there, and also to test the reliability of said information.

Is that ok with you, Willliam?

Certainly. The real clear markets and politics archives not to mention Bloomberg opinions and Yahoo finance are a bear and a half and that is just the icing on the top. Really hard data on the individual mandate will not be available until the summary of quarterly insurance reports are analyzed after 9/30/14, which is likely to be a real eyeopener got both sides. And there are a lot of cubbyholes like covered drugs or the lack of such coverage for serious pre-existing conditions. So, even a quick, down and dirty that's in the ballpark in 14 days will astonish me.

You can feel free to send me any link you wish, either per pm or via the mention function on this thread. I'm a BIG fan of the mention function, because there are just so many threads on USMB, I cannot possibly get to all of them and still live a normal life.

People who know me know that outside of numbers, I have a lot of fun, but when it comes to numbers and stats, I am brutally neutral. Ample evidence of this is already in the elections forum for people to see. I use the same descriptors, both positive and negative, for both sides and just let the numbers speak for themselves. And so I will do that here as well.

You might want to consider using this thread as a repository for all quarterly data that comes in pertaining to the ACA. I mean, it's your thread, you put the thoughrfulness into it, you could even amend the title accordingly, should you so wish. The nice thing about that is, we would then have a baseline to look back at in the next years.

What do you think of that idea?

 

[william the wie]

I'll try it. Just got back from a thread on the ACA formulary. I am ecstatic that unlike so many Nam era vets I did not catch Hepatitis C. However what I am most interested in is what will be tagged as ACA incorrectly. I kid you not sir, I have seen posts that blame the ACA for the effects of tax law changes for hedge funds and US side effects of the Chinese housing bubble.

Because of state and local income taxes combined with tax treatment of compensation starting in I believe 2017 banking jobs are leaving NYC and Chicago.

If you are not a serious criminal and are willing to open or buy your own business plus a house worth $500,000 or more you've got residency in the US for the asking. A fair number of Chinese and a lot of Canadians and Australians displaced by Chinese using similar programs in their home countries are creating real estate bubbles in this country.

I have seen both of these trends attributed to ACA with no known causal link at all. So this is in large part a myth buster thread. I hope.

 

[Antares]

The ACA will have some real negative impacts:

Fines for non-compliance

Recapture of over payment of subsidies.

Then there are questionable attributions of blame:

Migration patterns attributed to ACA. For example many people will flee CA in the coming years. Some migration will be due to drought, some to taxes and other various non-ACA issues. Some migration will be due to ACA issues.

Inflation, recession, increased automation or the continuing loss of jobs and GDP in most of the west coast and northeast to more Republican areas. All of these possible scenarios have their roots in lower state taxes and regulatory burden in Red states and higher in Blue states. Inflation will have more impact in blue states due to higher tax and regulatory burden. Likewise recession and increased automation will have skewed effects.

So, the GOP gets its wish takes power and finds out that there is no reset button on ACA. The status quo antebellum is gone and correcting real negative ACA impact will have no effect whatever on imagined/falsely attributed bad news about ACA. So, what happens when this reality is confronted?

The ACA will have some real negative impacts:

Fines for non-compliance

Recapture of over payment of subsidies.

These are completely hidden from the public right now, the average citizen simply does not pay enough attention to the details of well anything, least of all this.
These things are going to sneak up on the public and slap them in the face.

Migration patterns attributed to ACA. For example many people will flee CA in the coming years. Some migration will be due to drought, some to taxes and other various non-ACA issues. Some migration will be due to ACA issues.

Business migration has been going on in Ca for decades, the Tax burden is simply too high.
I left because I met a beautiful Nebraskan, the only things I miss are the weather and my youngest son.

Inflation, recession, increased automation or the continuing loss of jobs and GDP in most of the west coast and northeast to more Republican areas. All of these possible scenarios have their roots in lower state taxes and regulatory burden in Red states and higher in Blue states. Inflation will have more impact in blue states due to higher tax and regulatory burden. Likewise recession and increased automation will have skewed effects.


I think all of these things are long term issues.
Not all Red States are as Tax Friendly as you'd think, here in Nebraska we have some of the highest taxes in the country.

So, the GOP gets its wish takes power and finds out that there is no reset button on ACA. The status quo antebellum is gone and correcting real negative ACA impact will have no effect whatever on imagined/falsely attributed bad news about ACA. So, what happens when this reality is confronted?

Actually I am no so sure the GOP will have the political will to make any of the necessary changes.
In my lifetime they have been spectacularly spineless.
I think Jake and some of the others are right, it is here to stay.
There will be some tinkering around the edges, but nothing earth shattering, I also think that we are maybe10 years away from single payor.

The way this thing was/is structured precludes any real premium inflation until 2016.
Rates for 15 must be filed in May, that gives insurance companies 5 months of loss data...that's just not enough to make a realistic projection, I do however think that they will go for at least a 10% jump.

 

[william the wie]

I partially agree you with you.

The establishment GOP is definitely invertebrate. From there it follows that:

No official repeal, reform or replacement.

Certifying anything and everything as compliant is possible.

Easing the individual mandate to where it is totally meaningless is another possible non-fix.

This will leave the state exchange states flapping in the breeze.

But what is more likely is that ACA enactment is the highwater mark for medical costs as was predicted 36 years ago by Lewis Thomas in "Lives of a Cell" and no matter what is done it will quickly become a boondoggle of epic proportions. Bio-tech will quickly make it look as quaint as buggy whip manufacture. In all markets capitulation by the biggest fool of all signals a reversal of price trend and in the case of government healthcare it is very hard to find anyone else who can capitulate now.

As to single payer, it ain't likely if the above is true. Even if Obama figures out someway to unsnarl this mess the political capital needed has been dissipated.

 

[Antares]

Here's the thing....

One of the principal phrases in insurance is "adverse risk".

The entire industry is now awash in it...

premiums will not cover the losses.
The risk corridor's are temporary.... and soon will leave the losses to the companies this will break them and that is when we will see single payor.

 

[william the wie]

Here's the thing....

One of the principal phrases in insurance is "adverse risk".

The entire industry is now awash in it...

premiums will not cover the losses.
The risk corridor's are temporary.... and soon will leave the losses to the companies this will break them and that is when we will see single payor.

Well Ocare is reported to be similar to the WA state healthcare disaster of the 1990s. The questions I have are:

How many such state exchange trainwrecks have there been?

What percentage of the health insurance industry has stayed out of this trap?

How many one exchange provider areas, with AZ and MS hosting the two biggest I have heard about, are there?

Those companies that have stayed out of the trainwreck and those with monopoly areas would appear to have monopoly pricing power in their little fiefdoms and should survive.

 

[william the wie]

A new bit of news the Chinese banking system now officially has more bad loans than the US banking system has loans. That will eventually be a huge problem because Chinese official economic data is notorious for accentuating the positive even if that requires borderline fraud. "The Coming Collapse of China" by Gordon Chang 2001 is probably still the most accessible work on the Potemkin village aspects of China's economy. However there are many such works available just download a free ereader app from just about any vendor and look over the various works to find one in your budget.

When China implodes secondary real estate bubbles will pop worldwide but in the US such bubbles are confined to the Washington-Boston corridor, South FL, and the west coastal states. In other words the secondary effects will be confined to the areas of unusually strong support for the ACA. This correlation is most definitely not causal but it will be easy for PACs to treat it as such.

 

[Statistikhengst]

A new bit of news the Chinese banking system now officially has more bad loans than the US banking system has loans. That will eventually be a huge problem because Chinese official economic data is notorious for accentuating the positive even if that requires borderline fraud. "The Coming Collapse of China" by Gordon Chang 2001 is probably still the most accessible work on the Potemkin village aspects of China's economy. However there are many such works available just download a free ereader app from just about any vendor and look over the various works to find one in your budget.

When China implodes secondary real estate bubbles will pop worldwide but in the US such bubbles are confined to the Washington-Boston corridor, South FL, and the west coastal states. In other words the secondary effects will be confined to the areas of unusually strong support for the ACA. This correlation is most definitely not causal but it will be easy for PACs to treat it as such.

No way to know this for sure. Wait and see.

 

[william the wie]

Oh yeah. However McKinsey's prediction that increases in US productivity would overtake Chinese wages in 2015 can be trotted out this fall to claim that this transition is a result of ACA.

Some minor job transfers such as the Foxxcom transfer of a few programming jobs earlier this year can be trotted out to claim that ACA has already changed the transition date. So far it looks like only normal outliers have happened. But it can be sold differently.

 

[FA_Q2]

The ACA will have some real negative impacts:

Fines for non-compliance

Recapture of over payment of subsidies.

Then there are questionable attributions of blame:

Migration patterns attributed to ACA. For example many people will flee CA in the coming years. Some migration will be due to drought, some to taxes and other various non-ACA issues. Some migration will be due to ACA issues.

Inflation, recession, increased automation or the continuing loss of jobs and GDP in most of the west coast and northeast to more Republican areas. All of these possible scenarios have their roots in lower state taxes and regulatory burden in Red states and higher in Blue states. Inflation will have more impact in blue states due to higher tax and regulatory burden. Likewise recession and increased automation will have skewed effects.

So, the GOP gets its wish takes power and finds out that there is no reset button on ACA. The status quo antebellum is gone and correcting real negative ACA impact will have no effect whatever on imagined/falsely attributed bad news about ACA. So, what happens when this reality is confronted?

It won’t be.

Once the GOP has gained some power using the ACA as a soap box they are going to run away from it as fast as possible. Fixing the ACA requires that they admit they have been off message all along and the people will not be happy with that. Repealing it will only piss the people off more and quite frankly is impossible. Once something like this is in place taking it away is completely out of the question – particularly as so many are going to be subsidized.


I think that the most likely scenario is that the GOP uses this in the next midterm to gain ground but will not gain enough to make any real changes. As the presidency is not up for grabs, changes will not happen anyway. Then they will let the issue fade before the 2016 elections and try and find something else to run on. If they can’t, Obamacare will be a losing issue at that point. If they can you end up with the same result: it is ignored.

Sure, some things are going to have to be fixed but I don’t think those are going to be partisan in nature. Obamacare will be a reality at that point and the ‘solutions’ are going to be minor tweaks that are going to span ideologies.

As far as this leading to single payer – I think that is not going to happen. The insurance companies are not going to go out of business with the government essentially guaranteeing that if they are not profitable through the implementation of this monstrosity then they will be covered by government kickbacks. I would actually prefer single payer to this concept of trapped customers. The idea that a company can be protected by mandating the purchase of their product and then protected even further with ‘bail outs’ should they still fail is outright scary.

 

[william the wie]

The ACA will have some real negative impacts:

Fines for non-compliance

Recapture of over payment of subsidies.

Then there are questionable attributions of blame:

Migration patterns attributed to ACA. For example many people will flee CA in the coming years. Some migration will be due to drought, some to taxes and other various non-ACA issues. Some migration will be due to ACA issues.

Inflation, recession, increased automation or the continuing loss of jobs and GDP in most of the west coast and northeast to more Republican areas. All of these possible scenarios have their roots in lower state taxes and regulatory burden in Red states and higher in Blue states. Inflation will have more impact in blue states due to higher tax and regulatory burden. Likewise recession and increased automation will have skewed effects.

So, the GOP gets its wish takes power and finds out that there is no reset button on ACA. The status quo antebellum is gone and correcting real negative ACA impact will have no effect whatever on imagined/falsely attributed bad news about ACA. So, what happens when this reality is confronted?

It won’t be.

Once the GOP has gained some power using the ACA as a soap box they are going to run away from it as fast as possible. Fixing the ACA requires that they admit they have been off message all along and the people will not be happy with that. Repealing it will only piss the people off more and quite frankly is impossible. Once something like this is in place taking it away is completely out of the question – particularly as so many are going to be subsidized.


I think that the most likely scenario is that the GOP uses this in the next midterm to gain ground but will not gain enough to make any real changes. As the presidency is not up for grabs, changes will not happen anyway. Then they will let the issue fade before the 2016 elections and try and find something else to run on. If they can’t, Obamacare will be a losing issue at that point. If they can you end up with the same result: it is ignored.

Sure, some things are going to have to be fixed but I don’t think those are going to be partisan in nature. Obamacare will be a reality at that point and the ‘solutions’ are going to be minor tweaks that are going to span ideologies.

As far as this leading to single payer – I think that is not going to happen. The insurance companies are not going to go out of business with the government essentially guaranteeing that if they are not profitable through the implementation of this monstrosity then they will be covered by government kickbacks. I would actually prefer single payer to this concept of trapped customers. The idea that a company can be protected by mandating the purchase of their product and then protected even further with ‘bail outs’ should they still fail is outright scary.

You are making two assumptions I disagree with you on. My positions are:

The ACA has become a catchall for all of our economic ills including totally unrelated problems.

Those problems include:
That China has at least twice our debt load and half of out GDP with current industrial robots having a labor cost of about 70% of Chinese workers. But robot skills are trending up while costs are trending down so China is headed for a big shake out.
The ECB keeps warning about the risks of deflation particularly in energy prices i. e. the spread of fracking to say Brazil, which happened last year, could sink the EU.

Admittedly the above effects are coincidental but how do you expect voters and politicians to differentiate correlation and causation at the margin?

 

[FA_Q2]

The ACA will have some real negative impacts:

Fines for non-compliance

Recapture of over payment of subsidies.

Then there are questionable attributions of blame:

Migration patterns attributed to ACA. For example many people will flee CA in the coming years. Some migration will be due to drought, some to taxes and other various non-ACA issues. Some migration will be due to ACA issues.

Inflation, recession, increased automation or the continuing loss of jobs and GDP in most of the west coast and northeast to more Republican areas. All of these possible scenarios have their roots in lower state taxes and regulatory burden in Red states and higher in Blue states. Inflation will have more impact in blue states due to higher tax and regulatory burden. Likewise recession and increased automation will have skewed effects.

So, the GOP gets its wish takes power and finds out that there is no reset button on ACA. The status quo antebellum is gone and correcting real negative ACA impact will have no effect whatever on imagined/falsely attributed bad news about ACA. So, what happens when this reality is confronted?

It won’t be.

Once the GOP has gained some power using the ACA as a soap box they are going to run away from it as fast as possible. Fixing the ACA requires that they admit they have been off message all along and the people will not be happy with that. Repealing it will only piss the people off more and quite frankly is impossible. Once something like this is in place taking it away is completely out of the question – particularly as so many are going to be subsidized.


I think that the most likely scenario is that the GOP uses this in the next midterm to gain ground but will not gain enough to make any real changes. As the presidency is not up for grabs, changes will not happen anyway. Then they will let the issue fade before the 2016 elections and try and find something else to run on. If they can’t, Obamacare will be a losing issue at that point. If they can you end up with the same result: it is ignored.

Sure, some things are going to have to be fixed but I don’t think those are going to be partisan in nature. Obamacare will be a reality at that point and the ‘solutions’ are going to be minor tweaks that are going to span ideologies.

As far as this leading to single payer – I think that is not going to happen. The insurance companies are not going to go out of business with the government essentially guaranteeing that if they are not profitable through the implementation of this monstrosity then they will be covered by government kickbacks. I would actually prefer single payer to this concept of trapped customers. The idea that a company can be protected by mandating the purchase of their product and then protected even further with ‘bail outs’ should they still fail is outright scary.

You are making two assumptions I disagree with you on. My positions are:

And those would be?

Your post says nothing about the things you disagree with me on; just about points I overlooked and did not address.

The ACA has become a catchall for all of our economic ills including totally unrelated problems.

Those problems include:
That China has at least twice our debt load and half of out GDP with current industrial robots having a labor cost of about 70% of Chinese workers. But robot skills are trending up while costs are trending down so China is headed for a big shake out.
The ECB keeps warning about the risks of deflation particularly in energy prices i. e. the spread of fracking to say Brazil, which happened last year, could sink the EU.

Admittedly the above effects are coincidental but how do you expect voters and politicians to differentiate correlation and causation at the margin?

I would disagree that either of those issues are ever going to be related to the ACA by anyone including Washington. The ACA is the focus atm and that might cause Washington to outright ignore them but certainly not equate them with the ACA.

How would they possible blame deflation (particularly in the energy market) with the ACA? There is nothing there that can be pointed at that has anything to do with the ACA at all. The same goes with China’s new problems brought about by having a stronger economy. I don’t think automation is the issue btw but rather other nations are going to take China’s place. Already, nations like Taiwan are becoming the new China as labor costs increase in China.

Can you point to an instance where something that has zero relation to the healthcare industry is being blamed on the ACA? I know that there is a partisan tendency to blame everything on Obama’s policies but I have not seen anything that would be so asinine as to blame energy prices on the ACA.

 

[SteadyMercury]

I think that the most likely scenario is that the GOP uses this in the next midterm to gain ground but will not gain enough to make any real changes. As the presidency is not up for grabs, changes will not happen anyway. Then they will let the issue fade before the 2016 elections and try and find something else to run on. If they can’t, Obamacare will be a losing issue at that point. If they can you end up with the same result: it is ignored.

Agree 100%. There will be a few who keep trying to ride the same horse (like Cruz) but by 2016, good or bad, it will no longer something that can be as easily argued as the end of times.

 

[william the wie]

The reduction in job growth Dec. and Jan. was not attributed to ACA until Sebillious (?) pronounced that there was no job loss due to ACA. With that challenge suddenly job loss/lack of job growth that can be attributed to ACA is being trotted out as witness the thread here on USMB. The links are to sources that for the most part did not previously accuse the administration of engineering unemployment.

The administration's over promising and under delivering on ACA is driving an entire forum based on compiling ill effects that can be attributed to it. What is worse is that super PACs are already running ads that are causing slippage in the polls for the Ds.

 

[FA_Q2]

The reduction in job growth Dec. and Jan. was not attributed to ACA until Sebillious (?) pronounced that there was no job loss due to ACA. With that challenge suddenly job loss/lack of job growth that can be attributed to ACA is being trotted out as witness the thread here on USMB. The links are to sources that for the most part did not previously accuse the administration of engineering unemployment.

The administration's over promising and under delivering on ACA is driving an entire forum based on compiling ill effects that can be attributed to it.

You are all over the place here. This was not even mentioned in the two points that you made out earlier.

If you want this thread to be successful, you need to make an actual point that you want to address.

What is worse is that super PACs are already running ads that are causing slippage in the polls for the Ds.

What’s worse?

Why is this ‘worse?’ Worse than what?