Health Care Predictions

In the debate over the now-passed health care reform bill, a great number of statistics were brought out as to why the US desperately needed a bill like this: Numbers of bankruptcies supposedly caused by high medical costs and lack of insurance. Numbers of people who supposedly died each year because of lacking health insurance. Infant mortality rates, etc. With the bill now passed, Megan McArdle is curious to see those who supported it make some firm commitments as to what the results will be over the next five years:

1) Ezra Klein is confidently predicting that it will save hundreds of thousands of lives.
2) Nick Kristoff expects miraculous improvement in our national life expectancy.
3) Michael Moore thinks this will stop people from getting thrown out of their homes in a Medical bankruptcy.
4) At least one of you must be willing to claim massive improvements in infant mortality, after you've cited those statistics to me over and over.

These sorts of things should all be pretty easy to measure, and McArdle goes on to make her won eight predictions in regards to the effectiveness of the bill:

1) Conservatively, Ezra's arithmetic implies a reduction in the death rate of people between 18-64 of at 20,000-45,000 a year. Let's take the low bound--20,000 deaths a year--and assume that we should see that, or something close to it, by 2020. That's about 3% of deaths in the relevant age group, which would show up as a very noticeably kink in the death rate. For comparison purposes, the entire fall in mortality between 1980 and 2000 was about 2.7%.


Contra Ezra, I am predicting that this will not happen. I'm about 75% confident that you will not be able to discern any effect from the health care reform among the statistical noise. But I am 95+% confident that the effect will not be as large as 3%.


2) I'm pretty sure that Kristof read the table he was drawing from wrong--he was looking at life-expectancy at birth, but he interpreted the data as if it was about adults in the 1940s. Still, age-adjusted mortality fell about 15% in just 10 years, an achievement that hasn't been matched since. If Kristof is right, and this had more to do with health care access than antibiotics, we should be able to get a similar improvement this time around--especially since we're already seeing terrific reductions, with a 10% decline in age-related mortality just between 2001-6. Hell, both Ezra's numbers and Kristoff's imply that we should be able to knock down the death rate by at least 20% between 2014 and 2024, when we add their improvements to the existing trend.


I do not think that there will be a noticeable kink in the trend line around 2014. The death rate jumps around quite a lot, so there may be a big drop (or increase) in 2014, neither of which would be meaningful. By 2025, however, I'm skeptical that we'll see a major inflection in the trend.


3) David Himmelstein claims to believe that the majority of all bankruptcies are related to medical issues, and that this is a strong argument for national health care . . . i.e., he claims to believe that medical bills rather than income loss are the main causal driver here. That's the data Michael Moore is citing. I will make a bold counterclaim: the bankruptcy rate after 2014 will not fall by half. It won't even fall by a quarter. This is among the easiest effects to measure, as if the people citing these statistics are right, we should see a sharp and immediate reduction in bankruptcy rates in the first year, with the full effects evident by 2018.


4) Infant mortality should be no greater than that of the Netherlands by 2018. Again, I predict that this will not happen, and indeed, that infant mortality rates may not fall at all.

[read the rest]

Somehow, however, no one seems eager to take up this task from the other side. Indeed, Ezra Klein writes to McArdle insisting that he not be pinned down to having predicted any measurable results for the bill.

Of course, this is partly the result of the traditional political tides: Before a bill passes, supporters promise the moon if it passes. After is passes, they start under-promising in an effort to make sure that they don't get caught with "it didn't work" accusations during the next round of elections. Of course, all this is made even trickier when the authors of a bill intentionally frame it so that it doesn't take effect until after two more election cycles, thus taking advantage of the collective ADD of the American voting public. Democrats may have believed that the bill would save tens of thousands of lives a year, but they didn't believe it enough to want to save those lives between now and 2014 more than they wanted to be spared the effort of explaining themselves in the 2010 and 2012 election cycles.

This isn't a strictly a liberal phenomenon either. Wise Republicans would be hesitant commit to any specific number for increased federal tax revenues because of a tax cut and get no more optimistic than predicting that the tax revenue trend of the previous ten years would continue over the next ten years without a noticable long term impact. Still, given that this program will become one of the top ten line items on the federal budget, it is disheartening that its supporters are not even willing to commit to its having any measurable positive effects at this point. One is left wondering, if its effects will be so small as to be lost in the statistical noise, what exactly are we getting for our $200 Billion a year (plus even more in individual and business expenditures on insurance premiums?