Health Care Predictions

In the debate over the now-passed health care reform bill, a great number of statistics were brought out as to why the US desperately needed a bill like this: Numbers of bankruptcies supposedly caused by high medical costs and lack of insurance.  Numbers of people who supposedly died each year because of lacking health insurance.  Infant mortality rates, etc.  With the bill now passed, Megan McArdle is curious to see those who supported it make some firm commitments as to what the results will be over the next five years:

1) Ezra Klein is confidently predicting that it will save hundreds of thousands of lives.
2) Nick Kristoff expects miraculous improvement in our national life expectancy.
3) Michael Moore thinks this will stop people from getting thrown out of their homes in a Medical bankruptcy.
4) At least one of you must be willing to claim massive improvements in infant mortality, after you’ve cited those statistics to me over and over.

These sorts of things should all be pretty easy to measure, and McArdle goes on to make her won eight predictions in regards to the effectiveness of the bill:

1) Conservatively, Ezra’s arithmetic implies a reduction in the death rate of people between 18-64 of at 20,000-45,000 a year. Let’s take the low bound–20,000 deaths a year–and assume that we should see that, or something close to it, by 2020. That’s about 3% of deaths in the relevant age group, which would show up as a very noticeably kink in the death rate. For comparison purposes, the entire fall in mortality between 1980 and 2000 was about 2.7%.

Contra Ezra, I am predicting that this will not happen. I’m about 75% confident that you will not be able to discern any effect from the health care reform among the statistical noise. But I am 95+% confident that the effect will not be as large as 3%.

2) I’m pretty sure that Kristof read the table he was drawing from wrong–he was looking at life-expectancy at birth, but he interpreted the data as if it was about adults in the 1940s. Still, age-adjusted mortality fell about 15% in just 10 years, an achievement that hasn’t been matched since. If Kristof is right, and this had more to do with health care access than antibiotics, we should be able to get a similar improvement this time around–especially since we’re already seeing terrific reductions, with a 10% decline in age-related mortality just between 2001-6. Hell, both Ezra’s numbers and Kristoff’s imply that we should be able to knock down the death rate by at least 20% between 2014 and 2024, when we add their improvements to the existing trend.

I do not think that there will be a noticeable kink in the trend line around 2014. The death rate jumps around quite a lot, so there may be a big drop (or increase) in 2014, neither of which would be meaningful. By 2025, however, I’m skeptical that we’ll see a major inflection in the trend.

3) David Himmelstein claims to believe that the majority of all bankruptcies are related to medical issues, and that this is a strong argument for national health care . . . i.e., he claims to believe that medical bills rather than income loss are the main causal driver here. That’s the data Michael Moore is citing. I will make a bold counterclaim: the bankruptcy rate after 2014 will not fall by half. It won’t even fall by a quarter. This is among the easiest effects to measure, as if the people citing these statistics are right, we should see a sharp and immediate reduction in bankruptcy rates in the first year, with the full effects evident by 2018.

4) Infant mortality should be no greater than that of the Netherlands by 2018. Again, I predict that this will not happen, and indeed, that infant mortality rates may not fall at all.

[read the rest]

Somehow, however, no one seems eager to take up this task from the other side. Indeed, Ezra Klein writes to McArdle insisting that he not be pinned down to having predicted any measurable results for the bill.

Of course, this is partly the result of the traditional political tides: Before a bill passes, supporters promise the moon if it passes. After is passes, they start under-promising in an effort to make sure that they don’t get caught with “it didn’t work” accusations during the next round of elections. Of course, all this is made even trickier when the authors of a bill intentionally frame it so that it doesn’t take effect until after two more election cycles, thus taking advantage of the collective ADD of the American voting public. Democrats may have believed that the bill would save tens of thousands of lives a year, but they didn’t believe it enough to want to save those lives between now and 2014 more than they wanted to be spared the effort of explaining themselves in the 2010 and 2012 election cycles.

This isn’t a strictly a liberal phenomenon either. Wise Republicans would be hesitant commit to any specific number for increased federal tax revenues because of a tax cut and get no more optimistic than predicting that the tax revenue trend of the previous ten years would continue over the next ten years without a noticable long term impact. Still, given that this program will become one of the top ten line items on the federal budget, it is disheartening that its supporters are not even willing to commit to its having any measurable positive effects at this point. One is left wondering, if its effects will be so small as to be lost in the statistical noise, what exactly are we getting for our $200 Billion a year (plus even more in individual and business expenditures on insurance premiums?


7 Responses to Health Care Predictions

  1. Spamb says:

    On a slightly tangential note, the prediction going into the 2008 election among Catholics and other Christians supporting Obama that the abortion rate would drop under his administration (based on data from during the Clinton administration) is turning out to be wrong so far. From a January 2010 article:

    “The pregnancy rate among 15-to-19-year-olds increased 3 percent between 2005 and 2006 — the first jump since 1990, according to an analysis of the most recent data collected by the federal government and the nation’s leading reproductive-health think tank.”


    “The abortion rate also inched up for the first time in more than a decade — rising 1 percent — intensifying concern across the ideological spectrum.”

    I think this was clearly a case of wishful thinking and makes me not optimistic about comparable predictions related to health care legislation.

  2. Spamb

    Two things. Obama’s first year will include effects from the Bush legacy. Indeed, it is several years of effects based upon the wars Bush got us into and the financial crisis he inherited.

    Second, and more importantly, those stats are about 2005-6. Under Bush.

  3. S.pamb.ot says:

    Henry, you’re right on both counts. I need to slow down.

  4. afl says:

    First, that there will be a change in life styles is not a given. Acturialy the figures are guesses and until there is more data on changes figures are not credible as cost reductions are not in enacted bill. Insurance of every kind since its inception has been based on risk. Auto,H/O,Life,Workers Comp., Health, etc. State governments enacted no fault auto, mandatory auto, assigned risks pools, uninsured coverage.Life Ins added suicide clause and along with Health pre existing contract exclusion like wars, etc. H/O have left areas where natural disasters occur like costal regions. Ins Co have pools of their own for many risks to limit the losses. One thing is sure when health cos have to take all risks regardless of healtth or preexisting illnesses they know they are going to pay ( NOT A RISK BUT A SURE THING ) if you think their actuaries will not figure a cost and spread it to the healthy with an increase in health premiums you are living in a dream world. Mandatory auto has not elimninated uninsured drivers nor will this bill prevent healthy people who will still refuse health ins. and the joke of the IRS fining people when there will be no civil enforcement or interest on the so called fines , is about as ricdiculous as a bill can get. Flood Insurance did not solves flood losses, and all insurance polices have exclsuions, including WC, plus and which policies takes preference over another. The bill will not admittedly solve Medicare’s certain insolvency either. As to abortion, there is another certainy, it will continue unabated and perhaps increase. We tried the big fiaso of banning booze in he 20’s..people will do what people want to do and their actions can not be legislated til morals and culture is changed, but government never seem to realize this fact as our forefathers know inalienable rights..created equal..

  5. Blackadder says:

    It’s interesting how quickly people back down when it comes to making actual testable predictions about what will happen.

  6. jonathanjones02 says:

    Here’s my prediction: Jay Cost is correct.

    Our entitlement crunch is going to get very, very, very nasty – and in short order.

  7. Mike Petrik says:

    I agree that Jay Cost has nailed it.
    I suspect the Dems next step will be a VAT. Conservatives don’t like it since it is a largely hidden tax funds large government. Libs don’t like it because it is regressive (or at least not progressive). Libs will come to terms with it once they realize it can fund their huge programs, and conservatives will accept it as better than 50%+ marginal income tax rates. We will look a lot like Western Europe, which is what the Dems want. We will trade social and economic mobility for greater economic security. Not the end of the world, but sad nonetheless. I disagree with those who claim that such a system violates the Catholic principle of subsidiarity; I think this is pretty much all prudential. But I do wish the folks who are so attracted to Western Europe would just go and live there instead of trying to change the US.

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