8 Predictions for Health Care

At The Atlantic, Megan McArdle offers eight predictions for health care, now that ObamaCare has passed the house: 8 Predictions for Health Care.

My predictions:

1) Conservatively, Ezra's arithmetic implies a reduction in the death rate of people between 18-64 of at 20,000-45,000 a year. Let's take the low bound--20,000 deaths a year--and assume that we should see that, or something close to it, by 2020. That's about 3% of deaths in the relevant age group, which would show up as a very noticeably kink in the death rate. For comparison purposes, the entire fall in mortality between 1980 and 2000 was about 2.7%.

Contra Ezra, I am predicting that this will not happen. I'm about 75% confident that you will not be able to discern any effect from the health care reform among the statistical noise. But I am 95+% confident that the effect will not be as large as 3%.

2) I'm pretty sure that Kristof read the table he was drawing from wrong--he was looking at life-expectancy at birth, but he interpreted the data as if it was about adults in the 1940s. Still, age-adjusted mortality fell about 15% in just 10 years, an achievement that hasn't been matched since. If Kristof is right, and this had more to do with health care access than antibiotics, we should be able to get a similar improvement this time around--especially since we're already seeing terrific reductions, with a 10% decline in age-related mortality just between 2001-6. Hell, both Ezra's numbers and Kristoff's imply that we should be able to knock down the death rate by at least 20% between 2014 and 2024, when we add their improvements to the existing trend.

I do not think that there will be a noticeable kink in the trend line around 2014. The death rate jumps around quite a lot, so there may be a big drop (or increase) in 2014, neither of which would be meaningful. By 2025, however, I'm skeptical that we'll see a major inflection in the trend.

3) David Himmelstein claims to believe that the majority of all bankruptcies are related to medical issues, and that this is a strong argument for national health care . . . i.e., he claims to believe that medical bills rather than income loss are the main causal driver here. That's the data Michael Moore is citing. I will make a bold counterclaim: the bankruptcy rate after 2014 will not fall by half. It won't even fall by a quarter. This is among the easiest effects to measure, as if the people citing these statistics are right, we should see a sharp and immediate reduction in bankruptcy rates in the first year, with the full effects evident by 2018.

4) Infant mortality should be no greater than that of the Netherlands by 2018. Again, I predict that this will not happen, and indeed, that infant mortality rates may not fall at all.

5) I predict at least one of the major funding sources, and possibly all of them, will be substantively repealed: the Medicare cuts (except Medicare Advantage), the excise tax, and so forth.

6) This program will not reduce the rate of growth in medical costs by anything like 1.5% a year.

7) A fiscal crisis of some sort is quite likely by 2030, though not just because of this program. But this program will make it worse, either by increasing the deficit directly, or by using up the low-hanging fruit that should have funded Medicare reform.

8) By 2030, there's an 80% chance that the government will have imposed substantial price controls on pharma and other medical technology--and this will noticeably slow the rate of innovation.

I feel like any reasonable proponent of health care reform should be willing to take the other side of most of these bets, without weaseling that this isn't the health care reform that you wanted. If you aren't confident that we can get at least some of these results, than we shouldn't have committed to spend $200 billion a year . . . and you shouldn't have deployed these arguments in the run-up to health care.