JONATHAN COHN AUGUST 31, 2010
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Note: Here is my latest column for Kaiser Health News.
When Assurant Health, a Milwaukee-based health insurance company, announced this month it was laying off 130 employees in Milwaukee and Minneapolis, it blamed the health care overhaul for its struggles -- and at least one prominent critic of reform quickly chimed in. "There are more and more Obamacare job-killing stories piling up like this one," conservative columnist Michelle Malkin wrote in an item with the headline, "The White House War on Jobs."
I know a lot of smart, thoughtful health reform critics. Malkin is not one of them. But we will likely read more news stories like these in the coming months. And, given public ambivalence about health reform and anger over the economy, we'll likely hear more naysayers making these arguments. Some of them may even be respectable.
Will they be right?
Remember that companies lay off workers all the time. They also hire new ones. And while too many American companies are downsizing or shuttering these days, health care is one of the few sectors that hasn't stopped creating jobs -- and isn't likely to anytime soon, according to every forecast I know. If I wanted to cherry-pick stories for a clever-sounding column, I could just as easily talk about Dell, which is going gangbusters over the suddenly huge demand for medical information technology.
Of course, a perpetually growing health sector means we're shoveling more and more money into medical care. The whole point of our conversation about health care reform over the last few years, and the very explicit goal of enacting the new health law, was to find ways of curbing and diverting that growth. We want to spend just a little less, so that we have more money for other purposes. And we want to spend just a little differently, so that we're getting a higher quality, more humane health care system.
That brings us to Assurant, which specializes in selling policies in the individual and small business markets. This niche is the most famously dysfunctional part of our health insurance system -- the place you find carriers that aggressively avoid people at risk of getting sick and, frequently, sell policies that leave unsuspecting people exposed to huge medical costs. These carriers are also notoriously inefficient, on the whole, because they sell primarily through brokers, who take a hefty cut, and because they lack the economies of scale that large carriers have.
The health law forces insurers to cover basic benefits. It restricts their ability to mistreat consumers. And it limits the money they can spend on administrative overhead or broker commissions. Once fully implemented, reform will also prevent these carriers from avoiding people with pre-existing conditions. Make no mistake: These are all good things. They mean insurance is becoming more accessible, more comprehensive and more efficient.
Alas, that may also be bad news for Assurant. If the company's name sounds familiar, that's because it was in the news early this year when a Colorado jury slapped it with a $37 million judgment for wrongly refusing to pay the bills of a woman in a car accident. (The company claimed the woman had hidden evidence of a pre-existing condition. The jury, obviously, disagreed.) And when the layoffs were announced, an article from the Milwaukee Journal-Sentinel noted that reform would "undercut one of Assurant's strengths -- determining which customers are the best risks." I have no idea whether Assurant can find other ways to survive as a business. But, if it can't, then we're better off relying on competitors that can.
To be clear, sometimes reform really will reshuffle the health care economy in ways that make it worse. And it's never good news when somebody loses a job.
But the solution isn't to try to freeze every company's labor force and prevent every single job loss, especially in the health care sector. It's to promote a more efficient economy, while making sure the unemployed have jobless benefits, training for new work and actual jobs they can take.
I support all of those things. Given her obvious concern for the plight of newly unemployed workers, I'm sure Malkin does, too.
This column is a collaboration between TNR and Kaiser Health News. KHN is an editorially independent news service and is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization, which is not affiliated with Kaiser Permanente.
16 comments
not specific to this article of course, but Michelle Malkin is truly a horrible human being.
- miceelf
August 31, 2010 at 9:17am
As a horrible human being, it's no surprise that she has sympathy for the mephitic Assurant. If there are 9 circles of Hell, Malkin and the evil-doers at Assurant are in the 11th. (The other day "mephitic" penetrated my consciousness after I read it for the 3rd or 4th time, and I've been looking for a place to use it. Can't have too many synonyms for disgusting these days.)
- Geoff G
August 31, 2010 at 10:21am
My first encounter with Michelle Malkin occurred several years ago when she gleefully weighed on a new Christian radio station in Southwest Louisiana. Seems the new signal would obscure the NPR station for many listeners in the area. As might be expected, Malkin was all over that, loudly proclaiming that truth and justice was claiming the airways over liberal distortions. I then, as much as I could stomach, began following her, soon arriving at the conclusion that if Michelle Malkin is speaking, we would only hear distorted viewpoints at best, or outright lies at worst. She is not a happy person.
- NR149566
August 31, 2010 at 11:28am
J. Cohn, there have been plenty of articles written in the last few months from left and right media that are critical to changes in health care, and often lamenting that things that were promised (cost controls, more access, etc) that will not not come. Why not go after the substance of those, rather than a person? It's like you find the weakest person that has a comment on health care, and then you attack the person as if somehow that also causes the entire argument to collapse. And then the peanut gallery each take a shot a condemning the straw man to hell, affirming she's a liar, or complaining she drown out NPR. Sad. What is this? HuffPo? Here's a solid piece from Ben Smith: http://dyn.politico.com/printstory.cfm?uuid=8C22DEA6-18FE-70B2-A84E6340EB72163F Why not attack that? Or perhaps I missed it?
- seattleeng
August 31, 2010 at 11:40am
Oh give me a break. Michelle Malkin is a prominent right-wing blogger and she needs to be taken down on matters like this. Good on you, Jonathan Cohn. I knew Michelle Malkin back when she wrote for the daily paper that I have received forever. Then she was a libertarian-leaning conservative and was quite reasonable to talk to, even though we disagreed on many issues. I very much enjoyed having coffee and lunch with her in the mid-1990s. Her makeover is a result of one of two things: (1) She has simply become a nutter or (2) She has sold her soul for a mess of pottage. I think the latter is far more likely, and maybe was even conceived of by her husband as a good career move.
- liberal reformer
August 31, 2010 at 12:57pm
seattle I can't link to your full comment. Meantime, what miceelf said. The harm being done by scaremongering ranters is immeasurable. Also, the whole business of choosing one person over another for profit is really awful.
- Sophia
August 31, 2010 at 1:12pm
Michelle Malkin and her right wing ilk have the same modus operandi, It's as noted in Cohn's post: they cherry pick certain stories or even certain aspects of certain stories or certain details buried in a hay stack of details. Then on the basis of their cherry picking--which reduces itself to sound bites and slogans—they draw overarching and inflammatory conclusions like "The White House War on Jobs". Then they throw back at their critics their cherry pickings as the evidence for their conclusions. Because they take things out of context or don't give anyone the benefit of the whole, counter arguing against them requires nuanced, detailed and well informed responses, which is exactly what sound bite, shrill media have no time for. I suppose it's great propaganda and demagoguery, but it's hell on intellectual honesty and civil, fair and good faith discourse. And being that, it's invidious and threatening to democracy, the oxygen for which is rational, civil, good faith debate and deliberation.
- basman
August 31, 2010 at 3:35pm
Liberal reformer, if I might ask, when you were having the odd confab with the undivine Ms M, what kind of work were you doing? I ask only out of interest.
- basman
August 31, 2010 at 4:01pm
"Articles lamenting things that were promised and will not come" have substance? How? If I recall, all those lamenting that the future "cost controls and access" promises that haven't come are not making more substantive claims because of their pessimistic projections. Despite what one laments won't happen, we won't know for sure until 2014 when the reform kicks into full gear will we? I will begin to lament right now that I, despite my wishful thinking, will not have won the powerball jackpot in 2014.
- singlspeed
August 31, 2010 at 4:03pm
I disagree with you on this, Jonathan: "The whole point of our conversation about health care reform over the last few years, and the very explicit goal of enacting the new health law, was to find ways of curbing and diverting that growth. " I thought Democrats spent the last 60 years advocating for social justice in our health care system -- not controlling costs. You're not going to control costs when you require insurers to accept people who they currently reject in the individual and small group markets (because they are so expensive to insure), and charge these people the same rate as a triathlete (talk about causing moral hazard), and also require policies to cover more benefits (i.e., maternity care, mental health, prescription drugs) at higher levels. You'll create a more humane health care system, and make health insurance affordable for those who previously couldn't afford health insurance, but you won't control costs. That said, I would love to do more to lower provider salaries, establish clinical guidelines and best practices, and base payments to providers on comparative effectiveness research. But I'm more focused on making health insurance affordable for those with chronic medical conditions (stronger community rating, higher subsidies, and much more generous minimum benefits package). Even under current law, those people will still have to cough up too large a percentage of their income every single year just to live.
- jimbomoron
August 31, 2010 at 4:20pm
As long as you are criticizing Ms. Malkin, any chance you can comment on this observation, currently appearing in your own magazine? "I was never an admirer of President Obama. Despite his eloquence and his intelligence, he reminded me of no one so much as Michael Dukakis. Now, as I watch the waste of life in Afghanistan and the cynical rubbish coming out of Washington, he reminds me of Pontius Pilate."
- PeterAFish
August 31, 2010 at 5:44pm
PeterAFish. That appears on the website, not in the magazine.
- miceelf
August 31, 2010 at 8:04pm
Sophia writes: "The harm being done by scaremongering ranters is immeasurable." They are on both sides. it's called politics. If you understand Maddow and Olberman are the equivalent to Hannity and Beck, the congrats, you get it.
- seattleeng
September 1, 2010 at 2:51am
singlespeed: "Despite what one laments won't happen, we won't know for sure until 2014 when the reform kicks into full gear will we?" The link got eaten earlier, see 1) below. But in case you didn't get the memo, nobody is to talk about the cost savings bit any more. Because it won't come. The cat is out of the bag. Of course, it never really was in the bag. Let's recount...We were promised: 1) More people covered 2) Less cost 3) Better outcomes Instead, we got more people covered for more cost, with costs growing even faster than before...Same number of doctors serving 25M more people, means worse outcomes. And the groundwork for QALY and review boards, or death panels as some called them. Make no mistake, QALY and review boards are needed things. But to just flat out lie about anything critical of the plan was inexcusable. Obama's campaign promise should have been "A medium coke costs a dollar. A large coke costs $1.50. We all know that! Now, if we want to insure more people, we must all pay more!" But like Iraq. Gitmo. Afghanistan. NOLA. Budget. Deficit. Recovery. Unemployment. Tribunals. Lots of talk about how great it'd be during the campaign. But that's about it. 1) http://www.politico.com/blogs/bensmith/0810/The_new_message_Improve_health_care_dont_talk_cost.html
- seattleeng
September 1, 2010 at 3:01am
...If you understand Maddow and Olberman are the equivalent to Hannity and Beck... You've got to be fucking kidding! (And I'm not wild about the former two. But this comparison's from hunger.)
- basman
September 1, 2010 at 11:32am
seattle... I don't see anything in the article or the power point presentation that says what was "promised" won't be delivered. I don't see a slide in there that says or implies: Well...we promised but we won't deliver the following 1) More people covered 2) Less cost 3) Better outcomes. Again, what you seem to imply is that because articles, and in particular this one, are lamenting what was promised and haven't YET been delivered won't ever come. Ergo...HCR has failed or is failing. Perhaps I'm reading that into your post? What the PP presentation shows is that HCR supporters and Dems in particular have done and did a lousy job of explaining what HCR will do. In fact the PP show basically reaffirms what the original selling points were during the HCR debate that got lost in the partisan mudslinging (see Michelle Malkin for example). The Politico article headline really mispresents the "new Dem message" since all the points and arguments about the positives of HCR were being made during the debates prior to passage. The PP presentation is also indicative that there are a lot of people in the general population who are still uninformed or under-informed about HCR. I also don't see where you get the idea that for the additional 25M new patients there is and will always be a fixed and finite number of physicians to serve them. I happen to know that the Class of 2012 coming out of the LSU medical school here in NOLA will be the largest graduating class in the school's history. That's just one medical school. I can't say the same for other medical universities but I suspect that a positive of the economic downturn is that there are more applicants and students in med school than before. Perhaps it represents an increase of competition amongst physicians for those 24M patients. I would think that the job security of doctors is pretty much guaranteed. Now if you want to reduce the choke-hold on doctors graduated every year then talk to the AMA and med schools who keep a lid on number of accepted applicants and graduates that pass through the med school system every year. With regards to cost, IIRC, the HCR bill was promising a lowered trajectory of rising medical costs than the status quo but that costs would still rise just not as high or as fast. I wouldn't expect that medical costs in 5 years would be the same or lower than today, adjusted for inflation and demand, costs will always rise but I think HCR will slow the rising costs over a longer period of time than would happen otherwise under the current system. Of course the one thing I can lament about HCR that wasn't promised in the final bill was something closer to a single payer insurance system. And I'm still going to lament the fact that I haven't yet won the 2014 powerball jackpot.
- singlspeed
September 1, 2010 at 7:50pm