Central planners who created this Obamacare mess don’t get to blame somebody else

Written by . Posted in 2014 Campaigns, Featured, Issue Watch, Yep, This Happened

Published on November 13, 2013

CaptureAlec MacGillis at the New Republic makes the argument that one man is disproportionately responsible for Obamacare’s failure — Cato health care expert Michael Cannon.

No, it doesn’t make sense (Cannon offers a response here) but let me at least give you a flavor of the argument — it’s actually just a new or recycled version of one of the lame defenses of the administration that’s been out there for some time:

It’s been widely noted that one of the biggest challenges for the Obama administration in setting up the new federal exchange for health insurance was that the project was much bigger than anticipated. Why? Because far fewer states than expected decided to set up their own exchanges—36 of them left the task to the federal government. This meant the feds were left having to pull a huge web of databases, regulations and insurance offerings into healthcare.gov, and that the site was also hit with a greater rate of traffic than it would have been if more customers had gone to exchanges set up by their own states. 

The piece goes on to explain Cannon’s role in discouraging states from setting up the exchanges. Cannon disputes that he was personally as influential as the piece insinuates, but let’s just take it at face value and assume for the sake of argument that he did it all himself.

So what? Let’s not pretend as though a lack of state exchange websites is the real problem with HealthCare.gov or with Obamacare. That’s just ridiculous.

The federal exchange is failing because it was badly designed and badly built by the feds and their contractors despite ample time and ample warnings, not because states chose to rely on it instead of building their own expensive websites, many of which probably also wouldn’t work.

If you want to blame Cannon for the feds’ failure to complete a simple IT project, then you might as well blame Democrats for passing Obamacare in the first place and making a government IT project necessary. You’d be much more accurate to blame the White House for ignoring all the red flags, ignoring the warnings of sympathetic experts who knew that they weren’t taking this thing seriously enough. No don’t blame states for taking advantage of an option that would allow them to avoid the whole mess by leaving the website in the feds’ hands.

HealthCare.gov crashed after midnight on its launch day under the weight of just 2,000 simultaneous users — a fraction of what anyone should have expected. And even if overwhelming interest hit them hard that first night, it has probably never been a true problem for HealthCare.gov or any of the state exchanges, it isn’t now, and I’m guessing it never will be again. Consider some of these state exchanges in states where they’ve actually tried very hard to make the law work. In Minnesota, for example, they had only 42,000 unique users in their first month. Dear reader, this humble website, Conservative Intel, gets far more traffic than that, and there’s no mandate that says all Americans must read it or pay a penalty. 

The reality is that HealthCare.gov could have worked if federal officials had behaved competently and humbly, submitting to the oversight that the constitution requires. It has failed because of decisions made at the Center for Medicare and Medicaid Services and in the White House. Some of these decisions were politically calculated to avoid congressional oversight — including the decision to keep management in-house at CMS. Some of these decisions were politically calculated to avoid the wrath of voters, such as the decision to prevent users from getting correct up-front estimates of what they’d pay before handing over all of their personal information and verifying their identities.

Further, the creation of one federal website that doesn’t work has saved taxpayers a very large amount of money that would otherwise have gone to creating multiple state websites that also would not have worked. This is obvious when you look at how many of the state websites can be considered functional or successful. 

Oregon’s exchange website, which doesn’t work at all (but has awesome, freaky ads), cost over $140 million to plan, develop, and launch. Vermont’s website doesn’t work either, and it cost $84 million for the website alone, $170 million if you include federal planning grants and such.

Even many of the state websites that seem to work might just as well not — and that’s mostly a reflection on the offerings in Obamacare’s exchanges, the technology, or some combination of the two. Delaware’s exchange website cost about $13 million and has attracted 4 signups. The D.C. exchange cost a grand total of $133 million (to serve a population of 600,000 people) and, even by the most generous measure, has signed up fewer than 200 people. Other states, such as Maryland, have sites that sort of work but have been unimpressive and have failed to attract too many sign-ups.

So no, Obamacare is not working well enough otherwise that you can just go blaming Michael Cannon for its failure, even if you assume (against his own account) he was critical to one part of a larger process that made the federal website more important. The central planners who created this mess don’t get to blame the people who made it a less costly failure than it has been so far.