Times Main Economics Writer Loves Obama-Care for Disrupting 'Status Quo'

Times economics writer David Leonhardt reacted to news that McDonald's may drop health insurance for its workers because of Obama-care by blaming the status quo: "...it does represent progress. The fact that it is beginning to disrupt the status quo - that some insurance policies will eventually be eliminated and some inefficient insurers will have to leave the market altogether - is all the proof we need."
David Leonhardt's "Economic Scene" column on Wednesday, "Health Care's Uneven Road To a New Era," defended Obama-care against claims from businesses like McDonald's who say they may have to drop health insurance for their employees under the law's onerous provisions.

Leonhardt, the paper's main economics writer and an avid supporter of Obama-care's controversial cost-cutting provisions, defended the legislation in part by declaring the McDonald's health plan, worth $2,000 a year, virtually worthless anyway. The text box: "Shedding plans that are, barely, better than nothing."

A $2,000 plan happens to be one of the main plans that McDonald's offers its employees. It became big news last week, when The Wall Street Journal reported that the company was worried the plan would run afoul of a provision in the new health care law. In response to the provision, McDonald's threatened to drop the coverage altogether, until the Obama administration signaled it would grant some exemptions.

This episode was only the latest disruption that the health law seems to be causing. Also last week, the Principal Financial Group said it was getting out of the health insurance business, while other insurers have said they might stop offering certain types of coverage. With each new disruption come loud claims - some from insurance executives - that the health overhaul is damaging American health care.

On the surface, these claims can sound credible. But when you dig a little deeper, you often discover the same lesson that the McDonald's case provides: the real problem was the status quo.

Leonhardt backed up his defense by employing some serious statistical cherry-picking (ironically, the same thing Leonhardt accused insurance companies of doing with prospective customers).

We don't live as long as people in Canada, Japan, most of Western Europe or even relatively poor Jordan. Misdiagnosis is common. Medical errors occur more often than in some other countries. Unique to the developed world, millions of people have no health insurance, and millions more, like many fast-food workers, are underinsured.

In choosing their health reform plan, President Obama and the Democrats eschewed radical changes, for better or worse, and instead tried to minimize the disruptions to the current system. Sometimes, Mr. Obama went so far as to suggest there would be no disruptions, saying that people could keep their current plan if they liked it. But that's not quite right. It is not possible to change a system as huge, and as hugely flawed, as ours without some disruptions.

Liberals often cite the U.S.'s relatively low life expectancy compared to Europe to argue for broader health insurance coverage and-or socialized medicine. Yet the reason life expectancy is slightly shorter in America has little or nothing to do with the functioning of the health care system. In an article from September 2009, iconoclastic Times science writer John Tierney cited research from Samuel Preston, a demographer at the University of Pennsylvania.

This longevity gap, Dr. Preston says, is primarily due to the relatively high rates of sickness and death among middle-aged Americans, chiefly from heart disease and cancer. Many of those deaths have been attributed to the health care system, an especially convenient target for those who favor a European alternative. But there are many more differences between Europe and the United States than just the health care system. Americans are more ethnically diverse. They eat different food. They are fatter. Perhaps most important, they used to be exceptionally heavy smokers....Dr. Preston and other researchers have calculated that if deaths due to smoking were excluded, the United States would rise to the top half of the longevity rankings for developed countries.

Leonhardt concluded his defense of the current chaos caused by Obama-care:

The health care overhaul that passed Congress is far from ideal, as I have written many times in this space. But it does represent progress.

The fact that it is beginning to disrupt the status quo - that some insurance policies will eventually be eliminated and some inefficient insurers will have to leave the market altogether - is all the proof we need.