Posts Tagged ‘Obamacare’

I’m into the third week of the UI (user interface) design course I am taking via Coursera called Human Computer Interaction. The lectures for this week include a discussion of some prototyping techniques to use to quickly create a mockup of the interface for your system. The objective is to have a prototype to put in front of users to see how they interact with it and identify issues early in the development cycle. One of the techniques is called the “Wizard of Oz” method.

The name is inspired by the movie of the same name in which the wizard is really just a small man behind a curtain who is pulling the levers to make something much bigger appear operational. This technique is really great for early evaluation of user interfaces because you don’t have to spend a lot of time solving complex issues in the backend. You just need to have an interface that looks somewhat realistic. A “wizard”, which is a person behind the scenes not usually visible to the users, operates the controls to make it appear as if an automated system is actually running everything.

Today I was reading a story at Natural News with the headline “Head fake! Is Healthcare.gov only an empty shell MOCKUP of a working Obamacare exchange?” and it struck me right away that maybe healthcare.gov really is just a mockup in a Wizard of Oz prototype fashion. All the evidence would seem to indicate that. Like the fact that the people in charge can’t even say how many people have signed up through the system. That kind of information just falls out of a real system. Maybe they don’t know because it really is just a mockup with a bunch of people behind the scenes pulling the levers and they have to poll all them and collate the information before they know.

Another reason to think it might just be a mockup is how quickly and thoroughly it has been overwhelmed. Seriously, any system designed for this purpose would have to consider this volume of users at initial roll-out. I don’t think there is really any system on the backend.

And finally, anyone who has done contract work for the government knows how ridiculous it is. It is standard procedure to have specifications thrown at you that are bloated, poorly written, and often times scoped by inexperienced people. Then the specs get changed repeatedly, causing rework and delays. Then there is a funding issue at the end of each fiscal year when funding runs out, the project has to shutdown, and then later gets restarted again when the funding finally comes through, but in the mean time the previous development team went off and found other jobs. I know this one well from my previous work at an aerospace firm where I was a project manager.

My guess is that the system was not completed in time due to all the vagaries of government contracting. The government was firmly committed to a roll out date, but the system wasn’t ready so they threw up a mockup. The wizards, of course, were immediately overwhelmed.

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I shouldn’t be smug about this. Being smug tempts fate. But I can’t help it, because I don’t have to sign up for Obamacare! That’s right. Because I am an expat I can completely ignore all the nonsense and overreach of the U.S government as it forces everyone residing in the U.S. to purchase a product even if they don’t want it. As an expat who resides more than 330 days per year outside of the U.S. I am presumed to have “Minimal Essential Coverage” under the ACA so I am not required to purchase health insurance and am not subject to any penalty for not doing so.

So now that I have tempted fate by gloating about this I will worry that the USG overreach will extend further, and in the future they will force people like me who don’t even visit the U.S., and therefore cannot receive medical care in the U.S., to purchase U.S. health insurance anyway. They could very well do that since they already do many things that are completely unreasonable. Perhaps if they do force that on expats they will make some sense of it by requiring insurance benefits to be paid to where we actually use medical services, which is at our local medical facilities outside the U.S. That might be reasonable, although it is likely that the cost of insurance will far exceed any benefit we receive. That’s because I can meet my “Minimal Essential Coverage” by paying out of pocket since I get better health care at a fraction of the cost compared to the U.S. Here’s a good example, my foot surgery at Siriraj Hospital.

After I had that surgery I wondered how much would it cost in the U.S. Questions like that have long been tough to answer due to the sleazy evasiveness of the U.S. medical industry who won’t quote prices and just drop a bomb on you afterwards with outrageous fees. For this post I did some Googling and found something interesting called HealthCareBluebook.com. They list a “fair price” of US$16,398 for foot surgery consisting of $2,074 for physician services, $13,855 for hospital services, and $469 for anesthesia services. Here is the link. Interesting. That is 20 times the price I paid when I had my surgery at Siriraj Hospital in Bangkok by one of the top foot specialists in the country. Let me just say that I am a bit surprised the multiple is that high. I was expecting a multiple of 5 to 10.

Now what would happen if I had to buy insurance under Obamacare? I’m guessing that a single year of premiums would be more than the US$709 I paid for the surgeon + two nights in a private hospital room + anesthesia that I paid for my foot surgery. And of course I would have some deductible, probably at least 10% of the bill which would be at least US$1,600 for that surgery in the U.S. So probably at least, I mean the very least, I would be US$2,500 out of pocket for that procedure if I had U.S. insurance and did it in the U.S. And of course I would not have enjoyed the warm care and hospitality of the Thai medical staff; they are so nice and make you feel so comfortable even in difficult circumstances.

So no thanks America. I will stay right where I am. I just need to keep working on how to protect my hard-earned assets from the next attempted grab by the USG. We all do, no matter who we are or where we are.

I had read a bit of discussion about this subject some time ago, which is how business might be motivated to game the Affordable Health Care Act their benefit. But I had not previously seen any example cost numbers to illustrate just how motivated companies might be. I read some today at Huffington Post in a post by a doctor that discussed how the ACA will lead to eventually kill off private insurance.

The tactic for businesses is similar to that for individuals which is to not pay for the mandatory coverage and instead pay the penalty. For individuals the numbers go like this: insurance premiums for the average person are around $4,800 per year while the penalty is only $650 so pay the penalty and only buy insurance when you need it since you can no longer be denied (see my slight crimp post for the one complicating factor). Businesses would do the same thing, stop providing medical insurance for their employees and instead pay the penalty. The one example I saw was AT&T which spends $2.4 billion annually on health insurance for its 300,000 employees. If they instead stop providing health insurance and pay the penalty instead their cost would drop to $600 million. That’s a big incentive, and a classic example of creating a moral hazard.

After reading a story on TechCrunch about the new government health care website healthcare.gov I paid it a visit and checked out the page that discusses the Pre-existing Condition Insurance Plan. There are three conditions to quality for the plan:

  • You must be a citizen or national of the United States or lawfully present in the United States.
  • You must have been uninsured for at least the last six months before you apply.
  • You must have had a problem getting insurance due to a pre-existing condition.

It is that last bullet that puts a small crimp in my strategy for gaming the new law. If you read my original post you recall that the approach was to not buy health insurance and instead pay the penalty because it is on average only one-fourth the cost of insurance. But then if you anticipate needing insurance you buy it because you cannot be denied for pre-existing conditions under the Affordable Care Act. The requirement that “you must have had a problem getting insurance due to a pre-existing condition” adds a small complication to the tactic. You are going to have to first apply for insurance and get denied, then go and apply for the pre-existing condition insurance.

Details of the pre-existing condition plan are at http://www.healthcare.gov/law/provisions/preexisting/index.html You can get a cost estimate by state at the site. For example, a 50 year old subscriber in San Francisco would expect to pay $575 premium with a $1,500 deductible and $2,500 total out of pocket.

I was rather amazed at how widespread the rebellions against the new health care law is when I looked at that health care rebellion map. However, I’ve also been wondering what is the basis for the lawsuits. I saw a short post today about Virginia’s lawsuit that spelled out their position rather simply. It’s this:

“The federal government is forcing citizens to buy health insurance, claiming it has the authority to do so because of its power to regulate interstate commerce via the Constitution’s Commerce Clause. We contend that if a person decides not to buy health insurance, that person – by definition – is not engaging in commerce, and should not be subject to a federal mandate.”

And this:

Just being alive is not interstate commerce.

Kind of interesting, and quite simple actually.

That interesting map showing the states with pending action against the new health care law was pretty interesting. Now, the National Federation of Independent Business (NFIB), which is the most influential small business lobby, has announced they are joining that state lawsuit filed in Florida by 20 state attorneys general and governors. So the embroglio grows.

The NFIB announcement is important because they have a large number of members nationwide who are very active in matters affecting small business owners. So this action and every argument back and forth will get plenty of coverage beyond evening news soud bytes meant for mass consumption. Many small business owners are livid about the new burdens placed on them by health care reform legislation. With their presence and clout this will become a major factor in upcoming elections.

Small to medium size businesses with more than 50 employees are required to contribute to the cost of their workers’ health insurance. If you have a business that exceeds that threshold what would you do? Maybe you can do with 49 employees instead of 52 so layoff a couple. That would be pretty tempting because the marginal cost savings to your business would be huge.

Or maybe you can outsource an entire piece of your business. Get over your nationalistic bigotry. Your fellow Americans aren’t better people than the other good people in the world, and your government is crushing your business. So give some decent people in another country a big opportunity and at the same time keep your business afloat. The outsourcing trend has been flip flopping back and forth for a while, with a large exodus to places like India some years ago followed by pulling much work back due to substandard performance. Many outsource centers are improving and this new law provides a fresh incentive to outsource. Instead of laying off a handful of people and trying to shift the burden to the remaining employees, outsource and get a double savings both on salaries and health insurance costs.

A known penalty is an incentive

Posted: May 8, 2010 in Health
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When I wrote that individuals could game the new health care law by simply paying the fine instead of paying the much higher cost of mandated health insurance, I didn’t realize there were other nuances to that approach. The most directly related one is that employers might choose to do the same. And in fact several very large employers produced reports prior to the passage of the health care reform bill in which paying the fine versus providing health insurance for employees was traded off.

Now some people say that was simply posturing and that there hasn’t been talk of this since the law passed. I’m wondering why not? It must be they fear a big political backlash but it seriously seems like a trade off that any for-profit company would have to make.

There is another aspect to the whole issue that I happened to stumble upon. It is this interesting effect that involves introducing a penalty (a fine) to reduce some undesired behavior while leaving everything else unchanged. The assumption is that the undesired behavior will be reduced due to fear of the penalty. What is interesting is there have been studies that show that the undesired behavior may instead increase significantly. While some studies of this behavior have been disputed (the Israeli daycare center study for example) it is still an interesting effect to consider. I can totally see this happening in some cases. It is like the unknown or ill-defined result of having no penalty is a greater deterrent. Once a price is put on it then offenders know exactly what they are in for and are more inclined to calculate the cost/benefit ratio and choose the penalty. Isn’t this exactly what is going to happen with the new health care law?