I think we’re going to ultimately need about 20 million people for a sustainable pool. It doesn’t need to be this year. That’s what the transitional risk corridors are all about. But it needs to happen in the first few years. So when I hear people talk about the goal being seven million, I think, “time out.” This needs to be 20 million people within three years.4½ years ago we looked at the health care debate through the prism of the good-fast-cheap project triangle. What has resulted for many (not all) Americans is an objectively worse product that is not as good (narrower networks), slower (e.g., signing up takes hours, hospitals can't determine whether a patient is covered), and more expensive (see Robert Laszewski interview above).
I think the [individual] mandate is almost worthless because the word is getting around that they can’t really collect it. And by year three, it’s really a lot of money. I think there’ll be real pressure to just get rid of it. I don’t think you can force people to buy this insurance. If they don’t want it there’ll be a political groundswell to get rid of it. So in my mind the individual mandate is kind of irrelevant to this.
I think the 2015 rates will be the rates you’re looking at today, more or less..... Having said that I do have a concern that people are looking at these plans and not finding value. Some people are looking at paying 10 percent of their income for plans with huge deductibles, and then you have politics of Obamacare and the bad press of the launch and if you put all those things in a bag and mix them up, I am really concerned that the uninsured who are healthy are not finding Obamacare the value they hoped it will be. That’s the real risk for Obamacare.
The problem with Obamacare is it’s product driven and not market driven. They didn’t ask the customer what they wanted. And I think that’s the fundamental problem with Obamacare. It meets the needs of very poor people because you’re giving them health insurance for free. But it doesn’t really meet the needs of healthy people and middle-class people.
Obamacare advocates had years to design, implement, and test the system. It will be surprising if the voters do not to exact a penalty at the ballot box this November. © 2014 Stephen Yuen