No, Your Insurance Premiums Are Not Going To Skyrocket

Journalists report what they hear but often lack the background knowledge to really evaluate the information. This is especially true in health care, where journalists typically do not understand the complexity of the field. This creates great opportunities for those who want to play the ref, such as insurance companies talking about the Affordable Care Act. This is seen in a story at The Hill today claiming Obamacare premiums will skyrocket.

We have seen many other predictions of terrible things happening and they universally have failed to occur. Even the IT problems with the opening of the exchanges were quickly fixed. This falls into the same category, but of course conservative bloggers who prefer articles which reinforce their biases over facts have spent the day repeating it. When conservatives gloat over such claims, keep in mind that they are partially responsible for any future rate increases by putting out a misinformation campaign designed to dissuade people from signing up–including campaigns outright saying not to sign up.

It is always best to avoid panic with articles such as this. When predictions are made it would be best to simply wait until later in the year to see what happens, but obviously that doesn’t fit in with life in the blogosphere. At least wait a few hours as more information comes in. After the story began to spread, Ed Kilgore responded with a good take on this:

I’m sure many of you saw a certain headline from The Hill today: “O-Care premiums to skyrocket.” At first I thought the source was The Drudge Report.

If you actually read the accompanying article by Elise Vieback, the rather alarming assertion is mostly a collection of blind quotes from “health industry officials.” Yes, one former Cigna executive went on the record to say his “gut” tells him premiums could go up, which is of course very convincing. Otherwise the closest Vieback gets to attribution is an “insurance official who hails from a populous swing state.”

In an updated version of the article, Vieback does quote by name two experts—who deny the whole premise of her story.

And the “premiums to skyrocket” claim directly contradicts a variety of on-the-record assessments by health insurance executives—e.g., Aetna CEO Mark Bertolini, Wellpoint president Joe Swedish, and Cigna CEO David Cordani—that the Obamacare premium structure is working out relatively well. And the most reliable independent study, from the Kaiser Family Foundation, concluded that the much-feared “death spiral” of premiums that Vieback seems to be predicting as a reality for much of the country is very unlikely to occur.

Particularly in its revised form, Vieback’s piece has a number of “to be sure” qualifiers that undermine the headline. But it’s the headline that will get big coverage today—to be sure—maybe on Drudge Report itself. And it’s pretty clear which political constituency is driving the “story.”

I further discussed the reasons why the conservative death spiral scenario is not realistic last month, including quoting from the Kaiser report mentioned by Kilgore.

We also have to keep in mind the fact that double digit increases annually were common in the past in the individual market so there might be increases which are not out of line with past events. I once even had to change policies because of a tremendous jump in rates. I was able to find alternative coverage, but that is not true of everyone who lost their coverage in the days before the Affordable Care Act.

The insurance companies also do have a legitimate concern here, even if they are playing the refs with scare stories. They have to make predictions a year ahead of time as to what their costs will be to set premium rates. It was understandable that Obama gave into political pressures and made changes in the Affordable Care Act, but this also does make it harder for insurance companies to predict future costs. Allowing people to keep their old junk policies longer does adversely affect their calculations. The changes made will probably result in higher rates for legitimate reasons–but most likely much, much smaller than this article makes it sound.

Update: Even though it is posted at The Hill, it looks like this article might be considered just another piece of unsubstantiated garbage from the right wing noise machine. Elise Viebeck, writer of the article, did an internship at the right wing National Review.

Nate Silver Opens FiveThirtyEight With Questions Raised About Data Journalism

Nate Silver’s new site, FiveThirtyEight.com, opened this week and I must say I have been underwhelmed. Certainly check it out yourself and come to your own conclusion, but so far I hardly see the posts there as adding anything of value to online sources than we had in the past. I think this is largely because Nate Silver’s numbers driven type of analysis applies far better to sports coverage and polling than it does to many of the other topics which the new site attempts to cover.

Certainly other areas also involve analysis driven by numbers. If one is to run a web site based upon claims of superior analysis of the numbers, it is also important that the numbers be well established as correct. Think Progress has raised questions about FiveThirtyEight’s science writer on climate change. This also shows that it is important to read analysis which does more than just present numbers. As I learned back in college statistics, statistics is the science which shows that the average human has one testicle and one breast.

I don’t intend to downplay the value of Nate Silver’s polling analysis, but it was hardly unique in predicting the elections. Yes, he did far better than the many Republicans who predicted Romney victories based upon opinions rather than fact, but he was not the only one. Besides watching Nate Silver’s site, I also watched a couple sites which took an aggregate of polling results to show who was leading. This provided essentially the same results. It was also easy to predict based upon past results and limited knowledge of the states which states were tending in a different direction.

Nate Silver described his vision for his site here. I certainly appreciate the use of data to substantiate opinions, but so far the posts there have not really provided terribly meaningful data in other areas. Perhaps it will improve over time, but he would have been smarter to have a really major article telling us something we don’t know based upon the numbers to initiate the new site. First impressions are important.

Needless to say, his criticism of opinion articles hasn’t been accepted very well by some opinion writers. Paul Krugman hardly ignores facts and figures but has somehow been cast as the opposing model to Nate Silver’s. Krugman responded to Silver’s criticism of opinion writers:

Nate’s manifesto proclaims his intention to be a fox, who knows many things, rather than a hedgehog, who knows just one big thing; i.e., a pundit who repeats the same assertions in every column. I’m fine with that.

But you can’t be an effective fox just by letting the data speak for itself — because it never does. You use data to inform your analysis, you let it tell you that your pet hypothesis is wrong, but data are never a substitute for hard thinking. If you think the data are speaking for themselves, what you’re really doing is implicit theorizing, which is a really bad idea (because you can’t test your assumptions if you don’t even know what you’re assuming.)

Leon Wieseltier discussed the importance of opinion writers, concluding:

Since an open society stands or falls on the quality of its citizens’ opinions, the refinement of their opinions, and more generally of the process of opinion-formation, is a primary activity of its intellectuals and its journalists. In such an enterprise, the insistence upon a solid evidentiary foundation for judgments—the combating of ignorance, which is another spectacular influence of the new technology—is obviously important. Just as obviously, this evidentiary foundation may include quantitative measurements; but only if such measurements are appropriate to the particular subject about which a particular judgment is being made. The assumption that it is appropriate to all subjects and all judgments—this auctoritas ex numero—is not at all obvious. Many of the issues that we debate are not issues of fact but issues of value. There is no numerical answer to the question of whether men should be allowed to marry men, and the question of whether the government should help the weak, and the question of whether we should intervene against genocide. And so the intimidation by quantification practiced by Silver and the other data mullahs must be resisted. Up with the facts! Down with the cult of facts!

An opinion with a justification may be described as a belief. The justification that transforms an opinion into a belief may in some instances be empirical, but in many instances, in the morally and philosophically significant instances, it will not be empirical, it will be rational, achieved in the establishment of the truth of concepts or ideas by the methods of argument and the interpretation of experience. A certain kind of journalistic commentary, when it is done rightly, is a popular version of the same project, an application of thoughtfully (and sometimes wittily) held principles to public affairs, and is therefore an essential service to a free society. The intellectual predispositions that Silver ridicules as “priors” are nothing more than beliefs. What is so sinister about beliefs? He should be a little more wary of scorning them, even in degraded form: without beliefs we are nothing but data, himself included, and we deserve to be considered not only from the standpoint of our manipulability. I am sorry that he finds George Will and Paul Krugman repetitious, but should they revise their beliefs so as not to bore him? Repetition is one of the essential instruments of persuasion, and persuasion is one of the essential activities of a democracy. I do not expect Silver to relinquish his positivism—a prior if ever there was one—because I find it tedious.

Silver proclaimed in the interview that “we’re not trying to do advocacy here. We’re trying to just do analysis. We’re not trying to sway public opinion on anything except trying to make them more numerate.” His distinction between analysis and advocacy is a little innocent. (Like the insistence of the man who went from the Times to ESPN that he is an “outsider.”) Is numeracy really what American public discourse most urgently lacks? And why would one boast of having no interest in the great disputations about injustice and inequality? Neutrality is an evasion of responsibility, unless everything is like sports. Like Ezra Klein, whom he admires, Nate Silver had made a success out of an escape into diffidence. What is it about conviction that frightens these people?

I have many recent posts on health care reform. Yes, many parts of the issue can be quantified. I could concentrate on the number of people who were without coverage because of preexisting conditions and the number who lost coverage due to being dropped when ill. Numbers are also important when looking at Republican horror stories and the truth about how much money people are really saving under the Affordable Care Act. These are important parts of the story, but not the full story. We also must consider explanations as to how the health care system works and opinions as to how it should. The same is true in many other areas. Facts and numbers are important, but so are analysis, opinions and values.

Update:

This is an argument where neither side is entirely right or wrong. There is even a counter argument to Wieseltier’s assertion that, “There is no numerical answer to the question of whether men should be allowed to marry men.” Steve M wrote:

But there is very much a “numerical answer to the question of whether men should be allowed to marry men” — or at least the opponents of gay marriage strongly suggest that there is. Those opponents argue that gay marriage harms society — specifically, they say that children suffer harm from not having two opposite-sex parents. How do we know this is nonsense? We can look at the lives of children raised by gay couples and compare their well-being to that of children raised by married heterosexuals. If gay marriage were harming the children of gay couples, we’d know it, but it isn’t. And it’s good that we have studies showing a lack of harm, because if we were high-mided and Wieseltierian and chose to remain above the tawdry collection of data on this subject, the anti-gay right would generate all sorts of anti-gay-marriage data and drive the debate with it. (Perhaps Wieseltier needs to be reminded of the preposterous statistics about gay people’s health that have been circulating online and elsewhere for several decades — “the lifespan of a homosexual is on average 24 years shorter than that of a heterosexual” and all that.)

While I agree with Steve regarding the numbers involved, the fact remains that any discussion of gay marriage does also involve values–in this case the values of individual choice and separation of church and state in opposition of conservative values on this issue.

The debate between Krugman and Silver is one where neither side is entirely right or wrong and the differences between the sides are exaggerated when this turns into a blog debate. I don’t think that either Paul Krugman objects to presenting the numbers or that Nate Silver really thinks that everything comes down to the numbers.