Obamacare

ObamaCare's Free Preventive Services Aren't Free

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Credit: National Institutes of Health Library / Foter.com / CC BY-NC-SA

As public support for ObamaCare slumps into a post-election decline, the Department of Health and Human Services is trying to convince people that they ought to like the law by noting that it's already given free stuff to a whole bunch of people. An HHS news release this week brags that the "Affordable Care Act extended free preventive care to 71 million Americans with private health insurance" as well as 34 million Medicare Advantage beneficiaries—free benefits the agency says are giving Americans "more value" for their health dollars.

The problem is that the benefits in question are neither "free" nor likely to produce valuable savings. ObamaCare's rules eliminated individual cost-sharing for a number of preventive services, but, as the administration admitted a few months after the law passed, at the cost of higher insurance premiums on average. It's like a gym that suddenly makes all the drinks and snacks at its café "free"—but raises the price of membership. It's not free. You're just paying in a different way.

It's not cost-saving as public policy either, despite initial Democratic hopes that it would be. In fact, most evidence shows that it increases health spending. That's because eliminating cost-sharing increases utilization of preventive services; when there's no immediate price to pay for using a service, people tend to use more of it. And as the Congressional Budget Office reported back in 2009, "the evidence suggests that for most preventive services, expanded utilization leads to higher, not lower, medical spending overall." In general, the CBO noted, researchers have found that "the added costs of widespread use of preventive services tend to exceed the savings from averted illness."

For preventive services to have the largest benefits relative to costs, the CBO explained, the prevention efforts need to be narrowly targeted at only a few people who are likely to develop a particular ailment. The HHS claim that 105 million people took advantage of ObamaCare's "free" services suggests that there was not much targeting involved. Instead, the law took a broad-brush approach that likely raised insurance premiums for many and perhaps most of the individuals affected. But I suppose "Affordable Care Act shifts costs and raises premiums for 71 million Americans with private health insurance" doesn't make quite as good a press release.

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  1. Speaking of falsification: “Climate science” predictions are, well, crap:

    http://pjmedia.com/tatler/2013…..g-to-warm/

    1. The SOURCE of the graph is the UN IPCC but, since it APPEARS on a right-wing website it is obviously corrupted and biased.

      1. and I wonder how many proggies will discount it solely because this was on PJM. And is only likely to further appear on right-leaning sites.

        1. To be fair, that’s a legitimate first take. I’d do the same for something on PZ Meyers site or Hufflepuff.

          1. I wouldn’t. The source means the information is factually incorrect? If where they got THEIR information from was suspect in some way, that might be justified.

            But the fact that a story is reported by, for instance, Huffington Post, doesn’t invalidate the information itself. Even when I think a piece totally mangles the implications of the facts, the basic information itself usually pretty accurate.

            1. That’s why I said ‘first take.’ If they provide a means of confirming the claim, that’s a different story.

              And PZ Meyers is a loon. His claims of a warm and sunny day in July should be treated with skepticism.

    2. Wasn’t there an article out a few months ago about how half of what you know will be proven wrong within the next few decades?

      I think I know something that will fall in that half…

      1. I wish it would be proven wrong with an A-HA! type moment or discovery. That way I could smear it in the smug faces of all the greenies that are crying gloom and doom.

        Sadly, it will simply start to lose traction and slowly slide into obscurity as it becomes more and more apparent that AGW is bull.

        This delay in gratification will take a lot of the joy out of gloating. Sad.

    3. Ron Bailey….paging Ron Bailey…..

  2. “Free” rarely is free.

    1. Pelosi was right: we just keep finding out what’s in it, now that we passed it. Over and over and over…

      Every day is a new surprise.

        1. We’re just a bunch of ingrates.

          1. I think they should make a revision to the law so that it is issued a paragraph at a time, kind of like Word of the Day. The media and everyone else could talk about the meaning of the new provision, keeping the news cycle and water cooler discussions lively, and we’d have more time to digest the meaning of this well-considered rape of all that’s right and just.

    2. Free. I fucking hate that word.

      My econ 101 professor was a crusty old conservative….back when such people could get jobs teaching. First day, first class, he didnt even introduce himself, he just glared at us for 30 seconds or so and then said….”Free! There is no such thing as free! If someone tells you something is free I promise you, somewhere, someone is paying for it. Free is bullshit and dont ever use that word in my class.”

      He then launched into a 30 minute tirade about the evils of ‘free’.

      It was a rant that our Tony and Obama could benefit greatly from while being struck over the head repeatedly with a hickory stick.

      1. Hell my grandpa told me that one when I was 10. It’s common sense to anyone who has had to actually work for a living. It’s sad that an econ professor would even have to bring the subject up. It’s even sadder that so few of them do… I’ll bet that was a wonderful class.

      2. My first semester of college, I had a class called “Introduction to the Political Economy,” taught by a libertarian. It should have been called “TANSTAAFL 101” because it was pretty much 3 hours a week of exploring the real cost of free stuff, with some Hazlitt-style economics for homework.

        The students who went in as incorrigible Marxists left unfazed.

    3. But Obamacare is guaranteed to provide you with all the healthcare you need. They will even have panels of experts to determine just how much healthcare you need.

      Is it just a coincidence that within the last couple of years studies have indicated you really don’t need as many mammograms, prostate exams and now colonoscopies as previously thought? See? Meeting your healthcare needs just got cheaper!

      1. I’m kind of worried for different reasons. I can fully see Obama’s health panels deciding that I don’t go to the doctor enough and forcing it on me. I don’t like the doctor.

  3. The economic illiteracy in this law is absolutely astounding. Has anybody in the Obama Admin ever cracked open an econ book? I imagine them recoiling in horror the first time they see a demand curve.

    1. “The first lesson of economics is scarcity: There is never enough of anything to satisfy all those who want it. The first lesson of politics is to disregard the first lesson of economics.”

      ? Thomas Sowell

  4. You know who else tooka broad-brush approach…

      1. That tree he painted in the woods… you know the one that was supposed to be our “little secret”… it wasn’t free either.

    1. Mark Rothko?

  5. These are the same people who consider a transfer of health costs (UHC) free health care. What makes you think they would consider it any difference in this sense?

    These are also the same people who bitch about how expensive healthcare is, but think UHC will lower the deficit.

    “It’s not there as long as I can’t see it!” For a group of people who like to go on and on about how Republicans are anti-science and anti-logic. They’re just as bad if not worse.

    They blame Republicans for ignoring global warming when it’s not politically convenient, but they do the same damn thing with economics.

    1. The sooner they realize that they’re not science or logic minded, but populist minded. The better off we’ll all be.

    2. If I were looking to get “more value”, government is the LAST place I’d consider.

      Face it: ObamaCare is going to have all of the procurement efficiency of the Pentagon, the compassion of the IRS, the customer service of the USPS, the health statistics of the BIA … and the economic sanity of cash for clunkers.

  6. Listen, bitches, did I walk into CVS last weekend and walk out with my Antibabypille without paying anyone any money? Yes, yes I did. And I did the same thing a month ago. In your face, economics!

    1. Yeah, but when the insurance company gave you your antibabypill for free they doubled the cost for my plavix. So now I’m my chances by cutting out the plavix and doubling up on the aspirin I take each day. Thanks, death panels.

      1. S/b “taking my chances…”. See what happens when I don’t get my meds!

    2. Yep – my Antismokingpille was “free” also!

  7. “but, as the administration admitted a few months after the law passed, at the cost of higher insurance premiums on average.”

    Well, there you have it. Obamacare lowered your costs but the evil insurance companies screwed you again. We cannot solve healthcare costs in this country until we get rid of private insurance.

    1. This is why we need single payer. Insurance companies waste money in profits that go to the rich. Government does not waste money in profits to the rich. Thus government is more efficient in anything it does, because they don’t waste money by giving profits to the rich.

      /progressive “logic”

      1. At this point I’m almost convinced that our current system is farther from a free market than single-payer would be. Between state regulation, federal regulation and insurance/provider competition its hard to see how single-payer could make things more complicated. I honestly believe that single-payer has a shot at being cheaper overall than the current system. Outcomes would be even worse and we’d be farther from a free market in a political sense, but it would be cheaper. This is why we must never let them pass single-payer.

        1. The businesses involved still have a profit motive, and thus an incentive to do innovate and look for efficiencies. At least as much as the government allows.

          Put government totally in charge, single payer style, and innovation will grind to a screeching halt.

          The surest way to kill something is to put a committee in charge.

          1. I don’t know that the companies have much incentive left. Regulation pretty much defines how they will do business and how much they will charge. It’s damn near a cartel and if our current healthcare system doesn’t exemplify “killed by committee”, then I don’t know what would.

            1. I am still confident that putting government completely in charge would make it worse.

              1. My company, which sold next-generation MRIs, did not sell a single machine in the US from March 2010 until January 2013. Past tense because the factory is mothballed while they try to sell the company to the Chinese.

  8. If only there were some type of system out there that could optimally allocate these scarce resources in a way that respects the values of all the individuals involved. Oh, if only…

    1. We could call it “The Snee Park-It”!

    2. Something something each according to their needs something.

      1. I think it has to do with volunteering, right?

    3. If only I could allocate scarce resources in a way that optimally satisfies my values.

      -Tony

  9. It appears that the entire western world now thinks that universal healthcare is miraculously “free”.

    On a recent visit to dear friends in Canada, the matter of the show Breaking Bad came up. The son, aged 18, related how healthcare is “free” in Canada (never mind 50+% income tax rates) thus making much of the show pointless in their context. Sort of like this: http://fc03.deviantart.net/fs7…..39mg16.jpg

    (For the record, I understand that the cost of the character’s healthcare wasn’t his motivation for cooking meth, but rather a desire to provide for his family after his demise.)

    1. Yeah, the context of “you already paid for it” never seems to come up.

      Next time, ask them how much they paid for health care that they never used and never will.

  10. Weren’t HMO co-pays supposed to do this–have people pay some money for an office visit so that they don’t overuse it? Now we’re going in the opposite direction?

    “Preventive health saving money” sounds like it would save money, so that’s why liberals like it. Facts be damned.

  11. “It’s like a gym that suddenly makes all the drinks and snacks at its caf? “free”?but raises the price of membership. It’s not free. You’re just paying in a different way.” I like this line. It’s kind of like buying something for $9.99 and thinking it was a deal in comparison to something that was $10.00, except you actually get to keep a penny. The government really knows how to market the modern American liberal.

  12. That image; ewwww.
    http://sadhillnews.com/wp-cont…..l-news.jpg

  13. “Preventive” things are generally so simple and routine that the idea of not paying for these things out of pocket is retarded. It is completely obvious that using insurance, which is supposed to be for emergencies, to pay for a breast exam will add redundant bureaucracy and costs to the service and drive up the expense for everybody. Fuck progressives.

  14. I guess Reason’s Alt-Text isn’t free either.

    1. And yes, this is “Hi, back from Europe”. I’ll be expecting a full rundown of what I missed in the PM Links.

      1. Sarcasmic called John a chubby chaser.

        1. On a related note, I made out with a chunky Canadian girl on St. Paddy’s day.

      2. Tony googled some big important sounding words and then copy/pasted them in random order quite a few times…

  15. You know what? When a patient shows up in the ED with bed bugs, the licensed contractor doesn’t show up and treat the room free of his own feelings of charity, no he sends a bill. When the sterilizer in the SPD department goes down and needs fixed the licensed and insured contractor doesn’t do the job and says Merry Christmas! No he sends a bill. The fools who think that the buck stops at the patient/Dr. door are gonna get bit in bad ways when they end up doing the linen for their sick loved ones in the hospital.

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