Obamacare’s Most Important Ally

The healthcare industry:

Few industry leaders want to go back to a system that most had concluded was failing, as costs skyrocketed and the ranks of the uninsured swelled.

Nor do they see much that is promising from the law’s Republican critics. The GOP has focused on repealing Obamacare, but has devoted less energy to developing a replacement. Healthcare industry officials generally view several GOP proposals, such as limiting coverage for the poor and scuttling new insurance marketplaces created by the law, as more damaging than helpful to the nation’s healthcare system.

Drum argues that the “health care industry will do everything it can to make it work, and one way or another, it’s going to work.” For this reason, Francis Wilkinson expects the law to survive:

Under the new law, government payments to hospitals for treating uninsured patients are set to decline more than $30 billion over the next decade. Hospitals had expected to recoup that loss from an increase in patients insured through Obamacare. If red states continue to oppose the law’s Medicaid expansion, hospitals in those states will suffer and clamor for relief.

At which point Republican governors can decide to A) let local hospitals decline and patients suffer, B) find state revenue to provide relief, or C) accept Obamacare’s Medicaid expansion, in which the federal government picks up the tab for three years and picks up 90 percent of the cost thereafter. (I’m guessing Door #3.)

Along the same lines, Sargent notes the insurance industry’s advertising plans:

If the federal website is mostly operational by the end of the month, it’s likely we’ll see a massive flood of advertising from insurance companies selling new plans over the exchanges. The advertising that was placed on hold may simply resume –and it may be heavily concentrated in December and the three months in 2014 leading up to the March 31st enrollment deadline.

This comes by way of Scott Roskowski, the senior vice president for marketing for TVB, the trade group for commercial broadcasters. As the Wall Street Journal reported back in August, TVB had estimated, based on expected insurance industry profits, that insurance providers were set to spend $1 billion on ads over the next two years to woo new customers shopping on the exchanges. This was seen as a boon to the law’s chances — enrollment is crucial to its success – but it was forgotten after the website crashed.

But Roskowski says TVB’s research suggests what really happened is that insurers simply moved their ad buying forward, rather than cancelling it — and that much of that shift was to the four month period from December 1st to March 31st.