Under Obamacare, People Must Be Broken of their Preference for Choice

We have a new contender for most-telling-ever
Obamacare quote this morning: “We have to break people away from
the choice habit that everyone has.” That’s Marcus Merz, head of
Minnesota health insurer PreferredOne, in a New York Times
report on
the increasing prevalence of narrow network health plans.

Merz is basically stating openly what the Obama administration
won’t, which is that Obamacare is intentionally designed to narrow
consumer choice and plan design within the health insurance market.
The Obama administration doesn’t want to say this because it is bad
politics generally, and also because President Obama specifically
and repeatedly promised that, under the law, people would be able
to keep their choice of health plans and doctors, not that they
would be broken of their preference for medical choice. But the
law’s authors and administrators have a pretty good idea of what
kind of health insurance they want you to have, and that’s the kind
of insurance that you’re going to get.

“We’re all trying to break away from this fixation on open
access and broad networks,” Merz continues. “We”—by which I mean
the insurance industry—tried this before, in the 1990s, when
narrow-network plans referred to as Health Maintenance
Organizations were all the rage. It didn’t go so well, and
eventually insurers cut it out.

But this time it will be different, insurers tell The New
York Times. Why? Because…look, it will just be
different. Trust us. 

Although a similar attempt to restrict choice failed in the
early ‘90s, after opposition to H.M.O.s and managed care, insurers
insist these efforts will not run into the same resistance because
they are now working more closely with providers, and customers are
more concerned about costs. “It’s a new era,” said Dr. Sam Ho, the
chief medical officer for United Healthcare.

Others agree. “You’re going to see this as a dominant strategy,”
said Jeff Hoffman, who works closely with hospitals for Kurt
Salmon, a consulting firm.

And if insurance executives say it, well, it must be true, and
the liberal health wonks who back Obamacare would never think to
question them. Truly it is a new era.

Yes, obviously this time it is different, in the sense that
there is now a mandate to buy insurance and a bevy of
administration-enforced rules and regulations about what sorts of
plans, covering what sorts of procedures, can be sold through the
exchanges. Hence the necessary “breaking of the choice habit.” The
law is written in such a way as to severely constrain and, as a
result, practically predetermine which sorts of plans are available
at any given price point. Insurers all end up offering what amounts
to a few standard models, plus or minus a handful of decorative
touches. 

Given the limited choices and the requirement to buy, then, it’s
not really surprising that many customers end up choosing cheaper
plans—and the narrow networks that inevitably go along with them.
Or, as Karen Ignani, the head of the insurance industry trade group
America’s Health Insurance Plans, says in the article’s second best
quote, “What we’re finding is individuals are experiencing a
preference for affordability.”

It’s worth stopping for a moment to admire that quote. It is a
minor masterpiece of lobbying communications nothing-speak. It is
almost entirely removed from action or accountability. It’s like
she’s talking about a new observational study on cloud
formations. 

But people shopping for insurance under Obamacare are not simply
experiencing some mysterious condition. They are being required, by
law, to purchase a product, and then deciding that for the money
they have spent—which in many cases is merely a fraction of the
total cost, the rest of which is being picked up by taxpayers—they
do not like what they are getting in return. That is why the choice
habit must be broken. We can’t have people’s quirky, complicated
personal tastes and preferences messing up our perfect
system.