The Corner

HealthCare.gov: CEO Needed

Faced with the gigantic government failure that was the launch of HealthCare.gov, many advocates of the health-care reform are urging the administration to name a CEO to run its federal health-insurance marketplace. Reuters reports:

Advocates have been quietly pushing the idea of a CEO who would set marketplace rules, coordinate with insurers and state regulators on the health plans offered for sale, supervise enrollment campaigns and oversee technology, according to several sources familiar with discussions between advocates and the Obama administration.

Supporters of the idea say it could help regain the trust of insurers and others whose confidence in the healthcare overhaul has been shaken by the technological woes that crippled the federal HealthCare.gov insurance shopping website and the flurry of sometimes-confusing administration rule changes that followed. […]

Some healthcare reform allies say the complexity of the federal marketplace requires a CEO-type figure with clear authority and knowledge of how insurance markets work. [..]

The CEO proposal calls for removing day-to-day control of the marketplace from the CMS bureaucracy and placing it under a leadership structure like those used in some of the more successful state-run marketplaces, including California.

The new team would be managed by a CEO, or an executive director, who would run the marketplace like a business and answer directly to the White House, sources familiar with the discussions say.

The last sentence is interesting. A CEO wouldn’t be able to run this as a business if it has to report and answer directly to a body, the White House, that is mostly driven by politics and whose decisions, successes, and failures aren’t informed by profit and losses. In fact, a lot of the failed rollout of HealthCare.gov can be traced back to political decisions such as delaying writing regulations until the last moment (giving very little time to then build the website) or launching the website in spite of little testing and bad results when tests were actually conducted. 

One can also wonder why, if this is such a good idea, it wasn’t implemented from the start.

An interesting argument for the idea is also that it would appease the health-care industry. Whether that is true or not, it is a fact that health insurers have reasons to be worried. They made a deal with the devil by agreeing to comply to the law in exchange for the administration’s delivering millions of new forced consumers. Now they are finding that there are few limits to the White House’s willingness to throw the industry under the bus and that the reality of Obamacare may be quite different from the promises that were once made. Over at the Federalist, health-care expert Greg Scandlen has a great piece recapping the rocky road it’s been for insurers so far owing to the administration’s changes in direction:

Obamacare is not even fully in effect yet and already we are seeing the President playing with the carriers like a toddler plays with toy trucks –

  • Employers will be mandated to buy your policies for 2014
  • (Oops, employers are angry)
  • Employers won’t be mandated until 2015 – if then
  • Small employers will give workers a choice of health plans through the SHOP program in 2014
  • (Oops, we can’t get the web site ready in time)
  • Small employers won’t have to offer a choice of plan until – sometime later
  • You must cancel these individual policies
  • (Oops, public backlash)
  • You must reinstate these policies
  • (Oops, many insurance commissioners won’t allow it)
  • You must continue to cover providers and drugs even for cancelled policies
  • The deadline for enrollment will be December 15, 2013
  • (Oops, web site problems)
  • The deadline for enrollment will be December 23, 2013
  • (Oops, too much traffic)
  • The deadline for enrollment will be December 24, 2013
  • Never mind, there is no deadline
  • First month’s premium must be received by December 31, 2013
  • (Oops, back-end problems with the web site)
  • First month’s premium must be received by January 8, 2014
  • Make that January 10, 2014

This is probably only the beginning, and it won’t end well for the industry. 

 

 

Veronique de Rugy — Veronique de Rugy is a senior research fellow at the Mercatus Center at George Mason University.

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