Saturday, October 26, 2013

Two huge questions about Obamacare just got answered

 Two huge questions about Obamacare just got answered

 By Ezra Klein, Published: October 25 at 3:18 pm

We now know two things about the Obamacare rescue effort that we didn't know before.
First, we know who's in charge. It's clear now that management consultant Jeff Zients, who previously served as President Obama's chief performance officer, is running the rescue effort on behalf of the White House. And we know that QSSI, which constructed the data hub (which is actually working), will be the lead contractor in charge of the effort.
Second, we know the timeline. "By the end of November, will work smoothly for the vast majority of users," Zients said on a call with reporters today (Sarah Kliff has more details from the call).
So far, the White House has refused to offer a timeline, in part because they weren't sure what the timeline was. That meant that even the White House wasn't certain of the scope of the problems, and the difficulty in fixing them.
Now they are. Or, at least, they think they are. As Jonathan Chait writes, there are basically three possibilities here:
1) They know what they're doing.
2) They have fooled themselves into thinking they know what they're doing, but don't.
3) Meteor.
And since a senior administration official assured Chait that the White House did not have secret knowledge that a meteor would destroy the earth on December 1st and thus all of this was moot anyway, that only leaves one and two as live possibilities.
Well, there's one more possibility: That the White House is simply buying time. Saying they can this done by the end of November takes some of the pressure off until then. And if they fail, well, that's such a disaster for the law that adding the extra hit to credibility that would be lost from failing the timeline is almost irrelevant. It's like skinning your knee after cutting off your foot.
But Zients is a serious guy with a reputation to protect. He's unlikely to sign onto that kind of strategy. So let's assume it's #1. If the White House is right and Obamacare's digital infrastructure is working come the end of November the damage to the law will likely be minimal. This graph that Jon Cohn got from Jon Gruber (a lot of Jons in this post) shows the rhythm of sign-ups in Massachusetts:
Obamacare isn't on the same timetable. Come the end of November, there will only be four months until the imposition of the penalty. And if a lot of people simply pay the penalty in 2014 that means premiums will be a lot higher for 2015.
Four months is probably enough to relaunch the law and run a serious sign-up campaign. If they can make that deadline they're likely alright. Like Medicare Part D, Obamacare will have had a rough start, but it'll stabilize within the first year. If they can't make that deadline, they're in a lot of trouble.

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