I don't know anything about Obamacare except that it's so complicated there's no point in an ordinary person trying to understand how it will all turn out. And evidently the people who try to understand Obamacare come to different conclusions about whether it will destroy civilization or simply help some people who need it.

But interestingly, I'll bet there will someday be an objective way to look back and say, "That worked," or "What the $#%@ were we thinking?"

For example, economists will someday calculate that Obamacare cost X number of jobs, or perhaps even created jobs, or it was a drag on GDP of X dollars, or perhaps helped GDP. And we'll know how many people got health care, especially preventive healthcare, that otherwise might not have. I think economists can calculate the economic value of preventive healthcare. In other words, I'm fairly sure that in ten years we can say Obamacare worked, overall, or it was a huge mistake.

So who is up for some side bets on Obamacare?

I'm sympathetic to the opinion that introducing a huge, complicated, government-run program is just asking for trouble. On the other hand, the Adams Rule of Slow-Moving Disasters says everything will work out.

As a reminder, The Adams Rule of Slow-Moving Disasters says that any disaster we see coming with plenty of advance notice gets fixed. We humans have a consistent tendency to underestimate our own resourcefulness. For example, the Year 2000 bug was a dud because we saw it coming and clever people rose to the challenge. In the seventies, we thought the world would run out of oil but instead the United States is heading toward energy independence thanks to new technology.

Obamacare is a classic slow-moving disaster. Absent any future human resourcefulness, it just might be a nightmare. But my money says that clever humans will figure out how to tame the beast before it triggers the collapse of civilization.

If betting were legal, I'd bet $10,000 that in ten years the consensus of economists will be that Obamacare had a lot of problems but that overall it was neutral or helpful to the economy. I base that hypothetical bet on The Adams Rule of Slow-Moving Disasters, not on the scary first-year state of the law. And I reiterate that I know next-to-nothing about the details of Obamacare. I'm just working off of pattern recognition.

The armchair economist in me thinks there is a solution to the problem of some folks thinking Obamacare will be a disaster and other people thinking it will not. Simply create an online market in which the opposers can buy "insurance" from the supporters. In other words, a hardcore Tea Partier could pay $1,000 now to insure against future Obamacare calamity to his own net worth. An Obamacare supporter would accept the $1,000 and put in escrow $10,000 as a payout in the event that Obamacare heads to the worst case scenario. This idea needs work, but the idea is that opposers and supporters could place insurance-like side bets.

Which way would you bet? And keep in mind that you know as little about Obamacare as I do.

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+11 Rank Up Rank Down
Oct 19, 2013
I don't usually bother to log in, but I have an idea to share, which is based off of my experience in the military healthcare system. In the military healthcare system, the doctors are paid a reasonable salary (less than they would get outside of the military), with no financial incentive to prescribe one medication over another or to recommend medically unnecessary procedures. In the military medical system, care is free to users, so they go with the least expensive effective option, for instance generic medications. (It was actually a military study that concluded that many common medications are safe and effective for a period after their expiry dates, so they wouldn't waste more money than necessary replacing unused medicines.)

Now let's imagine that a self-contained healthcare system was set up. I think it would have to be done by a state, I can't think of anything else big enough but small enough to try it. This healthcare system would have several key characteristics:

1. Private healthcare would be left to operate however it wanted to, not regulated by this system.

2. All doctors entering the system would have their medical school debts paid for in exchange for a commitment of a certain number of years working within the system. (Basically, until the cost of paying for their school had been recouped.) Probably this will result in doctors leaving after their commitment is fulfilled for a higher-paying position outside, but research shows that doctors with more current training may provide better quality, more up-to-date care, so this can be seen as a plus. Doctors would be paid a reasonable salary.

3. Patients on state medical assistance (Medicaid, Medicare) would receive their care through this system.

4. Insurance would be accepted, but prices would be set, non-negotiable for the insurance, based on actual costs for supplies and procedures. (Facility overhead and pay for medical staff can be spread across procedures based on time-in-house. Longer procedures and stays would pay more of a facility and staff charge than a ten-minute visit for shots.) Patients paid for by the state would have procedures charged at cost, private patients using the facility might pay 5-10% more, and out-of-state patients (because the dramatically lower prices would attract people from across state lines) might pay 20% more.

I'm sure there are problems with this idea, but I wanted to put it out there because I certainly wish someone would do it. It is possible to get quality medical care without going completely bankrupt...the US military manages it. I just wish someone else would.
Oct 19, 2013
A couple of quick points. If the administration cannot effectively roll out a computer program for enrollment into the Obamacare system, why does anyone think the actual and more complicated substance will work any better.

Regarding slow moving disasters, I think that Mr. Adams is off the mark. American history is replete with examples of slow moving problems that end in utter disaster. Slavery is a good example of a intractable problem for 80 years after founding of the Republic, and ultimately deteriorated into civil war.

Another good example of a slow moving disaster is the anti-poverty programs of the 1960s which have ended up destroying the black family. It would be interesting to compare the typical black family of the late 1950s with the black family of today. I am willing to bet that most markers such as crime, out of wedlock births, educational levels are much worse today. I imagine it was a lot safer for a black person to live in 1960 Chicago than it is today. For all intents and purposes the black family is largely destroyed and not coming back in the foreseeable future.

One final example of an intractable problems which is going unfixed is the national debt. The national debt currently is almost 17 trillion. The problem is so intractable that the one group to actively advocate balanced budgets (The Tea Party) is called radical and terrorist when attempting to scale back the government to affordable limits. It is obvious (at least to me) at some point people will quit loaning the government money. I guess it is a forgone conclusion that the government will operate the printing presses full time printing more and more increasingly worthless money. I differ with Reid and Pelosi on matters of policy, but I still find it hard to believe that they are the chief lemmings leading America off the cliff without a second thought. The responsible thing for them to do would be to advocate for sky high taxes if they want lavish government spending, but they don't seem to have the character for that.
+5 Rank Up Rank Down
Oct 18, 2013
As far as the current issues go, it appears that most of the "glitches" are on the Federal site. In California, the state exchange site works OK (personal experience).

How it all turns out and the interesting betting scheme Scott proposes are beyond me. But I know that for about the same coverage, co-pay and deductible I have now, I will be paying 65% less in premiums starting in January (YMMV). So in terms of my economy, it's a clear winner.
Oct 18, 2013
For me, the most logical outcome of Obamacare is that it'll lead to a single payer (government health care only) system. As I see it, single payer will be the "fix".
Oct 18, 2013
Economics is so complicated, the only way to actually tell if something is going to work is to look in the past. Economic theory doesn't cover the real world in most cases. I predict Obamacare will have mixed results until it is naturally amended so that it looks more like working European health care systems.
Oct 18, 2013
The problem with the Adams Law of Slow-Moving Disasters is that we won't really know if the law is flawed until it's the EOTWAWKI.
+26 Rank Up Rank Down
Oct 18, 2013
I think Obamacare is like putting a band-aid on your computer monitor when your OS freezes after your browser crashes when you try to visit a website that doesn't exist.

We have fundamental problems with our American lifestyle that makes us unhealthy. We go to doctors when our un-health becomes serious. Our medical industry is inefficient and profit-driven, and we're financially irresponsible, so we rely on insurance to pay for it. But the insurance industry is also inefficient and profit-driven, and our insurance payments mostly don't pay for services, which are already inflated. Worse, most of our medical devices and medicines are produced under monopolistic "patents" that protect profits at the expense of society. Which is almost fair considering that our FDA makes it impossibly expensive to bring new medical technology to consumers.

In the end, we're worried about paying for insurance. But the insurance bill isn't the problem... it's the result of the problems on top of problems on top of problems compounded by problems.
+3 Rank Up Rank Down
Oct 18, 2013
"The Adams Rule of Slow-Moving Disasters says that any disaster we see coming with plenty of advance notice gets fixed."

Does your rule apply in situations where one of the two main political parties is attempting to thwart any effort to fix the Slow-Moving Disaster, and indeed would like to make it worse?

It's going to be difficult to fix problems with Obamacare, because to the extent the fixes require further legislation, the Republicans won't let them happen. Republicans would like Obamacare to be as bad as possible, because they want it repealed. How does that impact your Rule of Slow-Moving Disasters?
Oct 18, 2013
Check out the link. Very clear headed non-partisan take on the subject by Dave Ramsey


I believe the problem is that Obamacare will mask over the underlying problems in our healthcare system like the hidden price structure mentioned earlier. It also makes Others, wealthy or poor, pay for the unhealthy lifestyles. Some are unlucky, but most are paying for life choices.
Oct 18, 2013

[The ACA will have some success in getting more people on insurance, but it almost surely will not end up being the best or even the least bad alteration that could be imagined.]

Everyone has their ideas about what health care reform should have looked like. Thats part of the problem. There is no one set of proposals that most folks like well enough to get pushed through. The ACA is about as good as we could have expected.
Oct 18, 2013
Defining "success" of any particular government program is a slippery subject. Many say that Social Security and Medicare were successes, and contemporaneous with a large baby boom, they were, for a while. (So were Bernie Madoff's investments - at first). But given the disastrous demographic pickle they are in now, might different programs/systems have been better in the long run ?

Some of the evaluation depends on the metrics used. One can always find someone or some group who benefit from every government program. But the unseen losers or the counterfactual scenarios are usually neglected or not pursed at all. Because some are better off, does not mean that more people or the overall society would be better off without a given program. Or with a different one.

Finally, proposed programs are usually an "ideal" compared to a flawed existing system, because they haven't met reality yet. And the new program's *intentions* are presented as what will be accomplished with the new program. The ACA will have some success in getting more people on insurance, but it almost surely will not end up being the best or even the least bad alteration that could be imagined.
Oct 18, 2013
No insights of my own to offer about Obamacare. My prediction is that it will hurt more than help. IF the main intent of the law is to protect the rights of patients and make healthcare more affordable, I can almost assuredly say the law will miss the mark (duh, no brainer).

As a side note, here is an anecdote about what happens to government initiatives to "solve problems":

“The ICC [Interstate Commerce Commission] illustrates what might be called the natural history of government intervention. A real or fancied evil leads to demands to do something about it. A political coalition forms consisting of sincere, high-minded reformers and equally sincere interested parties. The incompatible objectives of the members of the coalition (e.g., low prices to consumers and high prices to producers) are glossed over by fine rhetoric about “the public interest,” “fair competition,” and the like. The coalition succeeds in getting Congress (or a state legislature) to pass a law. The preamble to the law pays lip service to the rhetoric and the body of the law grants power to government officials to “do something.” The high-minded reformers experience a glow of triumph and turn their attention to new causes. The interested parties go to work to make sure that the power is used for their benefit. They generally succeed. Success breeds its problems, which are met by broadening the scope of intervention. Bureaucracy takes its toll so that even the initial special interests no longer benefit. In the end the effects are precisely the opposite of the objectives of the reformers and generally do not even achieve the objectives of the special interests. Yet the activity is so firmly established and so many vested interests are connected with it that repeal of the initial legislation is nearly inconceivable. Instead, new government legislation is called for to cope with the problems produced by the earlier legislation and a new cycle begins.”
― Milton Friedman, Free to Choose: A Personal Statement
+14 Rank Up Rank Down
Oct 18, 2013
I'd bet good money that your prediction is wrong regarding our ability to look back an say "that worked" or ""What the $#%@ were we thinking?"

Nobel Prize-winning economists still disagree over whether the government should have intervened more in during the Great Depression or less.

I'll bet that in ten years that very few people will have changed their minds about Obamacare. Those that like it now will call it a success; those that hate it now will call it a disaster. And, as AtlantaDude pointed out, there really won't be an effective way to measure all of its consequences.
Oct 18, 2013
The whole Obamacare fiasco really encompasses one of the biggest issues with the United States - Arrogance. (Please note that I am referring to the people who run the country and not a commentary on the general public).

The parties with access to the media and the information surrounding the Obamacare issue act as though the US is the first country to ever consider moving in the direction of Universal Healthcare. I cannot say that I am intimately familiar with the details of Obamacare, nor do I really understand the health system I live under here in Canada. The short answer to the health care issue is that a move toward a universal healthcare system will be positive for the population on average. This statement is backed up by statistical studies that have shown that countries like Sweden, Canada, Australia, Japan and much of Europe all enjoy higher life-expectancy and better personal health in general (Google it, you will find tonnes of studies).

Often the culture in European countries are brought up in response to these studies saying it is just that they eat more properly and exercise more frequently primarily due to cultural factors. I will give you that, however, here in Canada we are just as fat and lazy as our neighbours (no, Chrome, I will not change that to the American spelling) to the south. The primary difference here is our health care.

There is one point that I will agree with the nay-sayers on. Some people (read "fat, rich, white Americans") will experience poorer health care but that is a trade-off in exchange for better overall health of the population. I would argue that something that provides the most benefit for the most amount of people is the best solution. (I know, I know. What a Commie.)
Oct 18, 2013
I know next to nothing about Obamacare but I do know that any complex man-made system is gamed by the participants such that after a little time, the tail ends up wagging the dog.

One example would be the judiciary. Court procedure, lawyers, juries were all invented to serve the ends of justice. Today, they all serve largely to delay or deny justice. Another example could be the stock market, which was supposed to find the right price for a stock but...

Likewise, whatever be its lofty goals, within some time, in now probably unforseeable ways, Obamacare may serve only to lower the standards of healthcare for most people.

Oct 18, 2013
The thing about government disasters, slow moving or otherwise, is that the people "solving" the problem are essentially the same people who created it in the first place, and every solution usually turns out to be the next disaster.

The federal government, when it creates and manages programs and spending that are not part of its Constitutionally assigned duties, is itself the slow moving disaster.
Oct 18, 2013
For the economy, I'd bet on a net positive effect. For some current one percenters; they get screwed.

Anytime money is spent, another person is earning that same money. It's all about the cash flow. When cash flows, tax revenues supporting social measures increase.

The rich don't have to worry about cash flow because they have a huge reserve. The poor are SOL when the cash stops flowing. Obamacare forces cash flow.
Oct 18, 2013
As far as we in the UK can see, Obamacare is similar to our National Health Service where medical care is free (funded by taxes). This was massively opposed by doctors when it was introduced but is now universally loved although beset by recent huge problems due to government interference and management stupidity. It also appears to us that BIG business (the drug companies and those who stand to lose zillions if it works) are concocting all sorts of scare stories to prevent Obamacare taking off. But that's the view from a few thousand miles away.
Oct 18, 2013
Regarding the actual law - I believe that MOST health problems are randomly assigned, and thus I have no problem with the lucky subsidizing the unlucky by having everyone pay basically the same premium, regardless of preexisting conditions. I also recognize that if insurance companies can't exclude or upcharge preexisting conditions, then nobody healthy would sign up, and the insurance companies would go broke. Therefore, I am not opposed to the idea of an individual mandate. All of the above could be accomplished with a fairly simple regulation and absolutely no government spending.

My problem with Obamacare is the premise that government is going to be an effective cost control mechanism. They have already tried top-down price controls with Medicare, and fewer and fewer doctors are willing to see those patients.

And, that brings us to the hidden costs that economists will never be able to measure. Top down price controls have been proven to drive down quality. More importantly, they will remove the incentives for innovation. So, while the economists may be able to (inaccurately) estimate the effect of Obamacare on GDP, they will never be able to measure the impact of the cure for cancer or Alzheimer's that wasn't invented, because the government forced down the cash flows of all those "evil drug companies".

A much better solution would have been for Obamacare to emphasize price transparency and higher co-pay participation. The medical community has for too long gotten away with the argument that they can't advertise a price for specific procedures because "every case is different". Well, there are plenty of professions have learned to price profitably in similarly unpredictable settings. A law encouraging / forcing doctors and hospitals to post prices on their websites would beat top down price controls by a wide margin in terms of effectively impacting costs, especially if coupled with a co-pay system that rewards the patient for paying less. It would also foster innovation because it would be required to stay competitive.

Sorry for the long post. In a nutshell, my view is that Obamacare will be a modest drag on the economy that will never go away. There will be larger, unseen costs from lost innovation opportunities. A better solution would be to keep the preexisting condition / individual mandate aspect and foster greater price transparency rather than top-down government control.
+23 Rank Up Rank Down
Oct 18, 2013
I'm with you, but with a caveat: Obamacare will be amended enough times in the next 10 years that you'll never be able to collect on any straight up bet. The opposition will claim it only worked because they fixed it, and Obamacare in it's original form would have been a disaster, so they still don't have to pay up.

The idea of structuring the bets as an insurance market might get around that, but one way or another people will find a reason to welch on their bets.
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