Wonkblog Caught in Obamacare Contradiction

New wonk blogging contradicts old wonk blogging
December 18, 2013

The Obama administration told the Washington Post in July that it defines the success of the Affordable Care Act as 'a function of the mix of people in the exchanges—the ‘ratio’—rather than the number of people in the exchanges."

The Post's WonkBlog wrote about this in November. However, on Tuesday, WonkBlog wrote that the ratio no longer matters.

Guy Benson picked up on the mixed messages.

In November, WonkBlog said that the ratio of young and healthy individuals to older and sicker individuals mattered more than the number of people signing up for Obamacare.

It all came down to the ratio. If 7 million people signed up for the exchanges -- as CBO predicted -- the Obama administration believed success meant ensuring about 2.7 million of them were young and healthy. If they got 10 million people to sign up, about 3.9 million had to be young and healthy. If they got 4 million to sign up, success would mean making sure 1.5 million were young and healthy.

The reason the ratio matters so much was that it is crucial to keeping premiums low. The White House always thought it possible that demand in the first year would be underwhelming, and until people actually saw the system was working, many would hang back from the system. But so long as the ratio was right, the premiums will remain low, and so when people eventually come to buy insurance, they can get a good deal, and they'll want to sign up.

That was when not many people were signing up for Obamacare. (Many still aren't.) But now it looks like the ratio doesn't matter either.

'The rumors of an Obamacare death spiral have been greatly exaggerated," WonkBlog says.

So say Larry Levitt, Gary Claxton and Anthony Damico, experts at the Kaiser Family Foundation who have put together a new brief analyzing what would happen if young adults snubbed the Affordable Care Act. Even if young people sign up at half the rate the administration hopes for, it would nudge premiums up only by a few percentage points, their report says.

What will really matter next month? Your guess is as good as ours.