Obamacare Just Saved The U.S. Economy From Contraction

[Perspicuo]

Huffington Post: Obamacare Just Saved The U.S. Economy From Contraction
http://www.huffingtonpost.com/2014/04/30/obamacare-economy_n_5242767.html

WASHINGTON, April 30 (Reuters) - As the U.S. economy teetered on the brink of contraction in the first quarter, one thing stood out. Healthcare spending increased at its fastest pace in more than three decades.

That surge is attributed to the implementation of President Barack Obama's signature healthcare law, the Affordable Care Act, also known as Obamacare. Because of Obamacare, the nation narrowly avoided its first decline in output in three years.

"GDP growth would have ... been negative were it not for healthcare spending," said Harm Bandholz, chief economist at UniCredit Research in New York.

Healthcare spending increased at a 9.9 percent annual rate, the quickest since the third quarter of 1980, and it contributed 1.1 percentage points to GDP growth.

 

[Underseer]

I had not considered that. A bunch of people who previously did not have health insurance suddenly have it, so of course they're going to run out to the doctor and get treated for long-standing issues, causing a surge in health care spending.

 

[maxparrish]

LOL...yet another cynical attempt to make a lemon into lemonade. What was once touted as the "bad news" in 50 years of policy debate, the rising percentage of GDP spent for health costs, is now recast by partisans as actually "good news". Do folks really believe the stuff they write?

By Edward Morrissey,
The Fiscal Times

May 1, 2014

The economic news this week may have people wondering whether they have gone through the Looking Glass into Wonderland. The Bureau of Economic Analysis issued its advance estimate of first-quarter growth in 2014, which barely made it into the black with an annualized GDP growth rate of 0.1 percent. Even that terrible result – the worst quarter since 2012, and tied for second-worst since the start of the technical recovery in June 2009 – would have been worse without an explosion of health-care spending as Obamacare enters its first year of implementation.

Not since 1980 has the American economy seen such a rapid expansion of health-care spending. It rose at an annualized rate of 9.9 percent, far outstripping inflation and standing in stark contrast to other components of the BEA report. Exports fell 7.6 percent, and demand for imports declined by 1.4 percent. Consumer consumption rose 3.0 percent, but that came in part from the high rate of health-care spending.

Related: Obamacare Boosted Health Care Spending—And GDP

The US had seen a drift downward in health-care spending, but the trend began to reverse as Obamacare first officially launched in October. In the fourth quarter of 2013, health-care spending rose 5.6 percent, far above the 2.6 percent growth rate of the economy, to which it significantly contributed. Without the spending on health care in 2014 Q1, annualized GDP would have dropped to a recessionary -1.0 percent, according to economist Ian Shepherdson.

It didn’t take long for supporters of the Affordable Care Act to change their tune on the benefits of increased health-care spending. Think Progress’ Igor Volsky wrote, “All of this was fully expected,” and that the spending just reflected the fact that more Americans “are finally getting insurance and are using their care.”

Oddly, the same publication lamented less than four months ago that Obamacare didn’t get enough credit for keeping spending increases down in 2012. “According to CMS, the spending growth between 2009 and 2012 is the lowest ever recorded in the past five decades,” wrote Tara Culp-Ressler in early January, “and 2012 is the first time in more than a decade that health spending grew more slowly than the U.S. economy.” She complained, “The CMS’ report isn’t giving the Affordable Care Act much credit” for keeping increases limited, as CMS attributed the slowdown to the economic malaise of the so-called recovery.

- See more at: http://www.thefiscaltimes.com/Colum...ggest-Lie-ACA-Will-Lower-Health-Care-Spending

 

[TV and credit cards]

LOL...yet another cynical attempt to make a lemon into lemonade. What was once touted as the "bad news" in 50 years of policy debate, the rising percentage of GDP spent for health costs, is now recast by partisans as actually "good news". Do folks really believe the stuff they write?

By Edward Morrissey,
The Fiscal Times

May 1, 2014

[snip]the spending just reflected the fact that more Americans “are finally getting insurance and are using their care.”

Oddly, the same publication lamented less than four months ago that Obamacare didn’t get enough credit for keeping spending increases down in 2012. “According to CMS, the spending growth between 2009 and 2012 is the lowest ever recorded in the past five decades,”[snip]

So more people are getting the healthcare they need and those services cost less (or not did not go up as much). Is there some other conclusion Ed is trying to draw?

 

[ksen]

max tries so hard.

 

[Tom Sawyer]

I suppose that how good or bad this is depends on the nature of the spending. If it means that medical costs for the same services have gone up a lot then that's a bad thing. If it means that people who needed medical care but who weren't able to get it are now receiving it and able to afford to pay for it then that's a good thing.

If it means that you're still using private dollars to pay for medical care instead of having it pooled together through taxation as a service offered to citizens as a benefit offered by being part of the country, then it means you're a nation of idiots.

 

[maxparrish]

More lemon squeezing from the tree of confirming bias, based on three hoped for but unsupported assumptions.

a) That lower health care spending between 2009 to 2012 was due to the actual healthcare services 'costing' individuals less, and that they still cost less.
b) That the 10 percent increase is spending was due to more people using these alleged lower cost services.
c) That those so blessed are actually getting materially beneficial healthcare that they otherwise would have forgone.

Of course that is poppycock.

First, the increase in coverage for previously uncovered Americans is (at most) 1-2 percent, not 10 percent.
Second, lower spending from 2009 to 2012 was not due to lower service costs, but due to lower numbers of the insured (around 1-2 percent).
Third, the increase is obviously from the well documented major increase in insurance premium costs for individual policy holders, and secondary effects on employer policies.

For 50 years one of the major justifications for health reform (the out-of-control medical inflation and very high GDP burden) has suddenly evaporated from left wing rhetoric - indeed, a fault is now a "feature" that is good for the economy.

Or did you not know this?

 

[doubtingt]

First, the increase in coverage for previously uncovered Americans is (at most) 2 percent, not 10 percent.

Those 2% of people had a disproportionate number of ailments and were far more likely to see the doctor and get treatments than the average person because they hadn't seen a doctor in so long. So they could very easily account for most of the 10% increase. In addition, some people had only minimal coverage below the Obamacare standards, thus their coverage is now better, meaning they can get treatments for things they could not before. That would account for a portion of the 10% increase.

For 50 years one of the major justifications for health reform (the out-of-control medical inflation and very high GDP burden) has suddenly evaporated from left wing rhetoric - indeed, a fault is now a "feature" that is good for the economy.

Wrong. The concern has always been the amount and quality of healthcare we are getting for the high amounts of $ spent. References to costs and % of GDP are made in a larger context of comparing to what we get in return, such as comparing the US to other nations that spend less but have better health and get better care for a higher % of their people. The US spends more on healthcare per capita than Ethiopia. Do you think any liberal thinks this is bad? No, and their arguments don't imply that its bad. They spend less because they have no available services to spend anything on. This illustrates how the meaning and implications of differences in healthcare spending have to be understood in context and that it is just moronic to point to an increase and assume that its automatically bad or that it means the same thing as high cost in a different context or when making a different kind of comparison.

 

[laughing dog]

More lemon squeezing from the tree of confirming bias, based on three hoped for but unsupported assumptions.

a) That lower health care spending between 2009 to 2012 was due to the actual healthcare services 'costing' individuals less, and that they still cost less.
b) That the 10 percent increase is spending was due to more people using these alleged lower cost services.
c) That those so blessed are actually getting materially beneficial healthcare that they otherwise would have forgone.

Of course that is poppycock.

First, the increase in coverage for previously uncovered Americans is (at most) 1-2 percent, not 10 percent.
Second, lower spending from 2009 to 2012 was not due to lower service costs, but due to lower numbers of the insured (around 1-2 percent).
Third, the increase is obviously from the well documented major increase in insurance premium costs for individual policy holders, and secondary effects on employer policies.

For 50 years one of the major justifications for health reform (the out-of-control medical inflation and very high GDP burden) has suddenly evaporated from left wing rhetoric - indeed, a fault is now a "feature" that is good for the economy.

Or did you not know this?

While I doubt that health care spending had much to do with the meager recovery at hand, it would be true that if the ACA induced spending that otherwise would not have occurred, then it did help spur some improvement in the economy in the short run.

The issue with the share of health care spending as a part of GDP is that a rising share of spending on health care is not consistent with an economy that grows at a healthy clip - a longer run concern.

It is possible for short-run actions to be beneficial in the short run but not in the long run.

So, it appears max's criticism resembles fruit from the tree of confirmation bias and not economic analysis.

 

[bilby]

Access to healthcare unchanged, spending rises nonetheless = bad
Access to healthcare broadened, spending rises as a result = good

Looking at only half of the argument, and then claiming that people are inconsistent because rises in spending are both 'good' and 'bad' = moronic.

 

[maxparrish]

Those 2% of people had a disproportionate number of ailments and were far more likely to see the doctor and get treatments than the average person because they hadn't seen a doctor in so long. So they could very easily account for most of the 10% increase. In addition, some people had only minimal coverage below the Obamacare standards, thus their coverage is now better, meaning they can get treatments for things they could not before. That would account for a portion of the 10% increase.

That may be true (or it may not). But if so, that is a rather steep spending increase if the entire market shoots up 10 percent in just the quarter to cover a mere 2 percent, resulting in the steepest quarterly increase since 1980. If, for example, only 5 million of the uninsured were covered then what is it going to cost to cover another 20 or 30 more million (before amnesty for illegals)? 40 to 60 percent spending increases, with commensurate increases on current policy holders to pay for it?

And as I pointed out above, it has yet to be demonstrated that for this massive increase of prices to John and Jane Doe (makers) is worth the health benefits to Ubo Swengali and Cooter Hatfield (takers)...soon to be supplemented by 10 million more illegal Jose's made legal and needing gravy train Medicaid.

For 50 years one of the major justifications for health reform (the out-of-control medical inflation and very high GDP burden) has suddenly evaporated from left wing rhetoric - indeed, a fault is now a "feature" that is good for the economy.

Wrong. The concern has always been the amount and quality of healthcare we are getting for the high amounts of $ spent. References to costs and % of GDP are made in a larger context of comparing to what we get in return, such as comparing the US to other nations that spend less but have better health and get better care for a higher % of their people. The US spends more on healthcare per capita than Ethiopia. Do you think any liberal thinks this is bad? No, and their arguments don't imply that its bad. They spend less because they have no available services to spend anything on. This illustrates how the meaning and implications of differences in healthcare spending have to be understood in context and that it is just moronic to point to an increase and assume that its automatically bad or that it means the same thing as high cost in a different context or when making a different kind of comparison.

Bunk. The concern has always been four fold: the national spending medical care and its impact on the economy, the impact of steeply increasing premium costs on typical families, the quality provided, and broader accessibility to health care for the uninsured. Obamacare was sold as a solution to solve all four problems not to make some concerns much worse in order to weakly address one (or two) concerns.

In 2009 Obama presented these concerns, including the looming fiscal catastrophe if something was not done:

When it comes to the cost of our health care, then, the status quo is unsustainable. (Applause.) So reform is not a luxury; it is a necessity. ... This is a test of whether we -- Democrats and Republicans alike -- are serious about holding the line on new spending and restoring fiscal discipline.

But let there be no doubt -- the cost of inaction is greater. If we fail to act -- (applause) -- if we fail to act -- and you know this because you see it in your own individual practices -- if we fail to act, premiums will climb higher, benefits will erode further, the rolls of the uninsured will swell to include millions more Americans -- all of which will affect your practice.

If we fail to act, one out of every five dollars we earn will be spent on health care within a decade. And in 30 years, it will be about one out of every three -- a trend that will mean lost jobs, lower take-home pay, shuttered businesses, and a lower standard of living for all Americans.

And if we fail to act, federal spending on Medicaid and Medicare will grow over the coming decades by an amount almost equal to the amount our government currently spends on our nation's defense. It will, in fact, eventually grow larger than what our government spends on anything else today. It's a scenario that will swamp our federal and state budgets, and impose a vicious choice of either unprecedented tax hikes, or overwhelming deficits, or drastic cuts in our federal and state budgets.

So to say it as plainly as I can, health care is the single most important thing we can do for America's long-term fiscal health. That is a fact. That's a fact. (Applause.)

http://www.whitehouse.gov/the-press...nnual-conference-american-medical-association

It's difficult not to LOL when a partisan trots out the steep increase in annual spending as a benchmark of success...unless fiscal concerns were just a cover for accelerating the cost to the economy.

 

[boneyard bill]

I had not considered that. A bunch of people who previously did not have health insurance suddenly have it, so of course they're going to run out to the doctor and get treated for long-standing issues, causing a surge in health care spending.

I don't think the health care spending was on health care. It was the money spend on the insurance that Obamacare required.

 

[boneyard bill]

LOL...yet another cynical attempt to make a lemon into lemonade. What was once touted as the "bad news" in 50 years of policy debate, the rising percentage of GDP spent for health costs, is now recast by partisans as actually "good news". Do folks really believe the stuff they write?

By Edward Morrissey,
The Fiscal Times

May 1, 2014

[snip]the spending just reflected the fact that more Americans “are finally getting insurance and are using their care.”

Oddly, the same publication lamented less than four months ago that Obamacare didn’t get enough credit for keeping spending increases down in 2012. “According to CMS, the spending growth between 2009 and 2012 is the lowest ever recorded in the past five decades,”[snip]

So more people are getting the healthcare they need and those services cost less (or not did not go up as much). Is there some other conclusion Ed is trying to draw?

Perhaps you should read the last paragraph again:

Oddly, the same publication lamented less than four months ago that Obamacare didn’t get enough credit for keeping spending increases down in 2012. “According to CMS, the spending growth between 2009 and 2012 is the lowest ever recorded in the past five decades,” wrote Tara Culp-Ressler in early January, “and 2012 is the first time in more than a decade that health spending grew more slowly than the U.S. economy.” She complained, “The CMS’ report isn’t giving the Affordable Care Act much credit” for keeping increases limited, as CMS attributed the slowdown to the economic malaise of the so-called recovery.

So the same people who were crowing about how Obamacare responsible for the slowdown in health cares spending because it was allegedly saving money, are now crowing about how that big INCREASE Obamacare shows they people are getting health care now that they were not before.

It's called trying to have it both ways.

 

[boneyard bill]

More lemon squeezing from the tree of confirming bias, based on three hoped for but unsupported assumptions.

a) That lower health care spending between 2009 to 2012 was due to the actual healthcare services 'costing' individuals less, and that they still cost less.
b) That the 10 percent increase is spending was due to more people using these alleged lower cost services.
c) That those so blessed are actually getting materially beneficial healthcare that they otherwise would have forgone.

Of course that is poppycock.

First, the increase in coverage for previously uncovered Americans is (at most) 1-2 percent, not 10 percent.
Second, lower spending from 2009 to 2012 was not due to lower service costs, but due to lower numbers of the insured (around 1-2 percent).
Third, the increase is obviously from the well documented major increase in insurance premium costs for individual policy holders, and secondary effects on employer policies.

For 50 years one of the major justifications for health reform (the out-of-control medical inflation and very high GDP burden) has suddenly evaporated from left wing rhetoric - indeed, a fault is now a "feature" that is good for the economy.

Or did you not know this?

While I doubt that health care spending had much to do with the meager recovery at hand, it would be true that if the ACA induced spending that otherwise would not have occurred, then it did help spur some improvement in the economy in the short run.

The issue with the share of health care spending as a part of GDP is that a rising share of spending on health care is not consistent with an economy that grows at a healthy clip - a longer run concern.

It is possible for short-run actions to be beneficial in the short run but not in the long run.

So, it appears max's criticism resembles fruit from the tree of confirmation bias and not economic analysis.

Yes, it's kind of idiotic to assume that if people hadn't spent the money on health care they would have flushed it down the toilet. In fact, you could point to any increase in spending and say that that was the reason that the economy grew by .1%.

The really relevant fact is that the economy grew by ONLY .1% and that paltry amount was due to an increase in consumer spending, not to an increase in capital goods. The recovery that the msm was crowing about at the end of '13 just hasn't materialized. The decline in spending, the closing of retail stores, the lay-offs that are being announced by nation-wide businesses clearly suggests that all is not well even if the stock market is near an all-time high.

It appears that what we are witnessing is fall-out from the "taper" that began in January and has accelerated every month since then. Without the printing press the economy is going into the dumper.

 

[Sabine Grant]

I had not considered that. A bunch of people who previously did not have health insurance suddenly have it, so of course they're going to run out to the doctor and get treated for long-standing issues, causing a surge in health care spending.

I don't think the health care spending was on health care. It was the money spend on the insurance that Obamacare required.

You will need to explain to me how and why the health care spending on health care has increased in my household since we have enrolled in a Silver Plan via the AHCA Exchanges. You must have some different explanation than my own conclusions :

1) Was part of the under-insured from 2009 to January 2014.

2) Dependent on a "crumb" Group Plan which could only result in self rationing due to the extremely limited benefits the Group Plan provided.

3) Currently, our Premiums are only 20 dollars more monthly than the Premiums we paid under our Group Plan.

4) Extremely limited benefits which placed us in the situation to not fill scripts either prescribed by my PCP or specialized medicine physicians such as my oncologist. Meaning skipping diagnosing tests, lab work, imaging procedures.

5) Came January 2014 and we caught up with all the indispensable tests designed to monitor the metabolic activity in my lymph nodes. Need I to give you a detail of the cost for all those medically necessary scripts?
You do not seem to realize that all under insured Americans had NO choice but to ration their health care spending. Which means that over the course of several years, early detection designed diagnosing tests were not accessible to them. There is a massive cost difference between treating an early diagnosed condition and one in advanced stages. Let alone the non access to preventative medicine having affected the under insured.

And you somehow *think* that the increase in spending is somehow not on health care?

 

[laughing dog]

Yes, it's kind of idiotic to assume that if people hadn't spent the money on health care they would have flushed it down the toilet. In fact, you could point to any increase in spending and say that that was the reason that the economy grew by .1%.

Are you referring solely to recently released advance estimate of US real GDP growth for the 1st quarter on 2014 which is based on incomplete data and subject to dramatic revision and also ignoring that the real GDP growth is estimated to have grown by 2.6% in the preceding quarter? (source: http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm)

 

[Loren Pechtel]

You will need to explain to me how and why the health care spending on health care has increased in my household since we have enrolled in a Silver Plan via the AHCA Exchanges. You must have some different explanation than my own conclusions :

1) Was part of the under-insured from 2009 to January 2014.

2) Dependent on a "crumb" Group Plan which could only result in self rationing due to the extremely limited benefits the Group Plan provided.

3) Currently, our Premiums are only 20 dollars more monthly than the Premiums we paid under our Group Plan.

4) Extremely limited benefits which placed us in the situation to not fill scripts either prescribed by my PCP or specialized medicine physicians such as my oncologist. Meaning skipping diagnosing tests, lab work, imaging procedures.

5) Came January 2014 and we caught up with all the indispensable tests designed to monitor the metabolic activity in my lymph nodes. Need I to give you a detail of the cost for all those medically necessary scripts?
You do not seem to realize that all under insured Americans had NO choice but to ration their health care spending. Which means that over the course of several years, early detection designed diagnosing tests were not accessible to them. There is a massive cost difference between treating an early diagnosed condition and one in advanced stages. Let alone the non access to preventative medicine having affected the under insured.

And you somehow *think* that the increase in spending is somehow not on health care?

The basic problem here is that the conservatives aren't willing to admit there has been a problem with health care. You had insurance before, you have insurance now. No benefit, any extra spending is pure waste. You are claiming extra medical spending, you must be simply wasting money. Why???

 

[dismal]

The basic problem here is that the conservatives aren't willing to admit there has been a problem with health care. You had insurance before, you have insurance now. No benefit, any extra spending is pure waste. You are claiming extra medical spending, you must be simply wasting money. Why???

Anyone who understand anything about US healthcare regardless of ideology knows that the US spends dramatically more than other countries and does not get appreciably better outcomes.

The news that more money will be spent on more insurance and more tests that probably won't result in appreciably better outcomes should not generally be taken as a positive. This is why Obama sold it as "bending the cost curve down".

But spinners gotta spin.

 

[Sabine Grant]

You will need to explain to me how and why the health care spending on health care has increased in my household since we have enrolled in a Silver Plan via the AHCA Exchanges. You must have some different explanation than my own conclusions :

1) Was part of the under-insured from 2009 to January 2014.

2) Dependent on a "crumb" Group Plan which could only result in self rationing due to the extremely limited benefits the Group Plan provided.

3) Currently, our Premiums are only 20 dollars more monthly than the Premiums we paid under our Group Plan.

4) Extremely limited benefits which placed us in the situation to not fill scripts either prescribed by my PCP or specialized medicine physicians such as my oncologist. Meaning skipping diagnosing tests, lab work, imaging procedures.

5) Came January 2014 and we caught up with all the indispensable tests designed to monitor the metabolic activity in my lymph nodes. Need I to give you a detail of the cost for all those medically necessary scripts?
You do not seem to realize that all under insured Americans had NO choice but to ration their health care spending. Which means that over the course of several years, early detection designed diagnosing tests were not accessible to them. There is a massive cost difference between treating an early diagnosed condition and one in advanced stages. Let alone the non access to preventative medicine having affected the under insured.

And you somehow *think* that the increase in spending is somehow not on health care?

The basic problem here is that the conservatives aren't willing to admit there has been a problem with health care. You had insurance before, you have insurance now. No benefit, any extra spending is pure waste. You are claiming extra medical spending, you must be simply wasting money. Why???

I am afraid too many conservatives are disconnected from the hardship and duress medically needy folks experience when limited in their access to indispensable medical care. It might be why they are "not willing to admit that there is a problem with health care". They also define the value of health care differently from the way liberals do. As a liberal, I understand health care as a VITAL service to the people, a service which does not include the notion of a profit centered industry. And of course I have experienced the benefits of a single payer system where private insurance may cohabit however only as a complementary insurance. Meaning the indispensable and vital benefits remain under the delivery of a single payer system regardless of the medically needy person's ability to afford the cost. Once more, the US health care system is far from matching the 100% coverage of the French single payer system addressing the medical needs of chronic and catastrophic illnesses affected persons.

 

[Sabine Grant]

The basic problem here is that the conservatives aren't willing to admit there has been a problem with health care. You had insurance before, you have insurance now. No benefit, any extra spending is pure waste. You are claiming extra medical spending, you must be simply wasting money. Why???

Anyone who understand anything about US healthcare regardless of ideology knows that the US spends dramatically more than other countries and does not get appreciably better outcomes.

The news that more money will be spent on more insurance and more tests that probably won't result in appreciably better outcomes should not generally be taken as a positive.

Please explain how and why more access to early detection tests "won't result in appreciably better outcomes". Do you have any knowledge of the cost difference between treating an early stage condition versus a later stage? Let me give you one right now and see how much longer you will stand by your claim :

-detected at a stage 3 (that because of no previous access to diagnosing tests), the cost for Rituxan treatments for a Stage 3 NHD Lymphoma B, low grade, was between 5 and 6000 dollars per infusion. Regimen to be maintained over the course of 2 years, every six months for 4 weeks.

Further, extended remission depends on how early it was detected and treated. In case you cannot make the connection between "extended remission" and cost benefits, it means that the diagnosed person will not necessitate as many treatments due to frequent relapses as the patient diagnosed in later stages more susceptible to experience shorter remission periods.

It is to the benefit of the Insurance industry to cover EARLY detection tests addressing a multitude of conditions and allow for an early diagnosing which in the long term facilitates curability due to the application of early treatments as well as prophylactic ones.

After 3 years as an under insured cancer patient being kept in "the dark" due to my non access to PET/CT Scans, the most effective imaging tool to detect a resurgence of my type of lymphoma, I was able to benefit of covered by our new plan of a PET/CT Scan which detected abnormal metabolic activity in 2 areas. However, instead of jumping into immediate oncology designed treatments, we are monitoring via a repeated PET/CT Scan in 3 weeks. That to establish whether the detected activity increases or stays stable or decreases. Those imaging tests are absolutely indispensable for my oncologist to assess whether we are dealing with an established resurgence. If we could biopsy the affected lymph nodes, we would. We simply cannot due to their location under the breast bone. The other area was deemed non malignant thanks to a biopsy of nodules in the thyroid. A test you would qualify as part of "tests that won't result in appreciably better outcome" yet a biopsy designed to identify and distinguish malignant from benign. And for those who came back with "malignant", it is the difference between life and death.

This is why Obama sold it as "bending the cost curve down".

But spinners gotta spin.

As you pulled out of thin air your claim of "more tests that probably won't result in appreciably better outcomes"? Why do you not invest your energy in informing yourself as to the variety of health related conditions benefiting of the prospect of curability when detected early?