Drying out. I wonder, are you familiar with the work of james okeefe, the more entrepreneurial, lesser known young journalists . The question i get a lot, to say that he is the only investigative journalist in america is a disservice. All sorts of names being tossed around as i said, i am optimistic about journalism, optimistic that there will continue to be new ways of people as indignant and is angry as seymour hersh. Whether anyone can persist for as many years and have as many scoops in stories says seymour hersh, that i am doubtful of, certainly not that there will be tremendous investigative journalists. It is also a new world. The internet has given us all sorts of new possibilities. What is we is snowden releases his material. He would have leaked that material to a journalist. The nature of traditional journalism has been turned upsidedown. [inaudible question] maybe i am misremembering. Them the least talented he predicts that the u. S. Would be invading iran and make a really strong stand on that which did not pan out obviously. Zero number of times that the bush of lustration had very specific and was making very specific plans for an invasion. That never happened and people got it wrong. What i say in the book and a number of people told me is that when his articles kept coming out and the new yorker it was not possible for them to do an invasion. What he was really writing about was the possible invasion. He never said theyre going to invade. He says, my sources are telling me the plans, and here is with that look like theyre people out there in the someone to go to deal to get out the story. In some ways he was getting out the story did. He prevented such an invasion. [inaudible question] it is a good question, and i do not know the answer right now about a month ago he wrote an article in the london review of books. The first thing he had in writing, and he wrote about the fact that when syria had a sarin gas attack that killed 2500 people, the Obama Administration immediately blame syria. His sources are telling him that there was other evidence indicating that it was not the syrian government. There were other people in and around syria it could have been irresponsible that cherry pick intelligence and chose to ignore that. He also turned that argument down, which was shocking while wonderful article. And so has his relationship ended . I mean, like every other he has ever had to my feet to threequarters of the editors of the world and threw them off of a bridge he never gets along with anders which was certainly the case, but a very interesting kind up channel fours and a very controlling force. We will see soon enough. Any other questions . All right. Thank you all for being here. Thank you. [applause]rategy associates. He is a consultant to the policy commend as was to the Marketplace Community with great expertise in the Insurance Industry. Hes been doing this for more than 20 years now, and he was named because of his incisive and clear writing about the implementation issues in 2013. Is meant by the Washington Post as the 23rd games wonkblog pundit of the year which is actually a pretty fine distinction. He was chief operating officer of it health and Group Benefits and sure and has been active in and around the Health Policy in workplace issues in this field for a very long time. Hes a real expert and we are very, very grateful, op, vigilant to come to talk to us today. Thank you, and join me in thanking bob for coming today. [applause] its great to be here, great to be with all of you today. Ive been a real fan of tim and joke for a long time, as scholarship aei and i appreciate very much getting the invitation. I would give my perspective today. It will be a different perspective than youve heard, at least from where i come from. Just so all of you know, i work in the marketplace, and i learned long ago that my job was to figure out to satisfy customers. Number of clients out there and what they expect me to do is to figure out whats going on in the marketplace, and whats going on in federal policy and help them navigate their business through that change. If they want the conservative perspective they will go to fox news. They want the liberal perspective they will go to msnbc. As Business People they need to know whats going to happen and how its going to impact them. Ill try to bring that perspective here for you today. Ive been working and washed them one way or another either as an executive or somebody running his own business for more than 25 years. As an Insurance Industry executive it occurred to me way back that the Insurance Industry could not sustain itself if its Business Mission was to figure out who not to cover. In order for the Insurance Industry to survive economically and politically if you how to cover everybody. I also figured out pretty quickly that as an industry we couldnt do that ourselves if as a chief operating officer ive got preexisting conditions tomorrow afternoon, i wouldve had a long line down berkeley street in boston of people lined up to sign up for my coverage and i would be broke pretty quickly. I realize there is a willful government as a referee in this whole process. Jay carney said a few months ago that i had been an opponent of obamacare for 20 years. Which i guess makes me the first opponent of a bunker since it is all about five years old. I dont see myself as an opponent of obamacare. Survey not an opponent of Health Insurance reform or of Health Care Reform. Most of you know those are two Different Things. I am a critic of obamacare and i think it leads to lots of changes but i guess everybody says that todays of it doesnt make me any different. Im going to firstly when going to do a bit of do my best to tell you. The Affordable Care act has not cleared the tower to borrow a headline from one of washington, d. C. Is media outlets. It needs fixing. Particularly in its Health Plan Offerings your want to clear the sprinkler and it was launched and present of almost elected theres never been any doubt in my mind that this law will be enacted. I dont think its going to look that much like it does today 10 years from now or even five years from now. But its also clear to me were not going backward in this country. Were only going forward. Now, it does need a lot of fixing. One of the things that concerns me about the socalled 8 million enrollment is it my convinced the ardent supporters of obamacare that it doesnt need fixing. As a whole lot of difference between offering a monopoly in Health Insurance in the United States today and a small group and individual Health Markets and actually have created something that people like and want to be part of. Theres a big difference, a big distinction and i think its the most important thing to understand where we are with the Affordable Care act today. Ill tell you what i think we need to go and that they were i think the fixes need to be, shortterm and longterm but ill tell you i dont think theres any chance we will have any fixes before at least 2017. It doesnt matter what happens in the election in 2014 whether the republicans capture the senate or not. Were not going have the environment or the votes for any kind of substantial change to the Affordable Care act. We will probably not have the political atmosphere for any substantial can change. I think this thing limps along for a number of reasons. It livelong actuary our financial and it lets along politically. I will also tell you that i think while the supporters of obamacare citing 8 million account of his days i think republicans are overconfident as well. I actually think the democrats could take this issue back by november if the republicans are not careful. So there are two very different interpretations of the socalled 8 million enrollments. The first is the enrollment estimate of the exceeded expectations by we have hardly made a dent in the number of people who are uninsured. Or the enrollment process program is working. Its on its threeyear projected cbo track and doesnt need any major fixes, or the program is still a regulatory nightmare and needs to be repealed and replaced. I expect most people are sort of in one camp or the other on this. But i would also suggest theres more commonality than that if we really think about it. Weve seen a lot of the surveys and its been at the heart of whether obamacare is, in fact, succeeding or not. The Mckinsey Survey came out first. This data was early, february. But it does include the late surge in enrollment and what they point out is that most of the people who were signing up where previously insured, that we werent really attracting the uninsured into the program. These numbers have almost certainly changed in the last two months but i will suggest that chronic problem this program has is attracting people who are not insured before. Fundamentally because the way the product, and in my context of my background these are roddick stem cells, the products are not all that attractive to people. The Rand Corporation came up with a survey that went into midmarch, came up with some of the same conclusions that we were getting more of the people moving over from the insured market that we were picking up on in church. This is a fundamentally important question. Because why did we turn the Insurance Market upside down and in such a Small Group Market if were not going to be successful in getting the people we wanted to get in first place. This is at the core and the heart of whether we can become to you on the right track or not. I will also tell you that when you look at these polls, be careful. This particular poll says that the majority of people who were gaining insurance were gaining it in the Employer Market. You heard the mercer represents a few minutes ago there didnt seem to a lot of indication from the surveys thats happening. I was with one of the largest selfinsured Insurance Companies in the United States yesterday, ensures millions of people in the selfinsured market and went to the head of marketing and i said, are you seeing any increase in the Employer Market and the number of people signing up . He said no, nothing, flat. Thats what i continue to hear all over the marketplace. This survey indicates signing of all kinds of people in the Employer Market. I dont know where they are. Im not saying that my information is better than something the Rand Corporation has put out but i will tell you we need to be very, very careful when we look at these polls. We need hard data. The most recent poll came from gallup through april 14 reflecting more of the search. The bottom line is that gallup has found that probably about one in four people who were uninsured have found insurance even medicaid or otherwise. That makes some sense to me because when you look at the enrollment numbers and put a look at the 8 Million People coming through the exchanges, you can make some comparison to hard numbers rather than just do polling. The 8 million needs to be reduced by the people who are not think how many are not paying . 17 . Its a pretty good number. As i go around talking to people as recently as yesterday, this particular carrier, hundreds of thousands of people in the exchange, more than 20 its not as bad as only 15 , and its not 20 either but its in the middle. If you adjust that 8 million by about 17 , it would be a pretty good estimate i think when its all said and done, and then you adjust for the fact that 83 of the people are subsidy eligible, you get a number that you can compare to the Kaiser Foundation estimate of 17. 2 million are subsidy eligible and what you get . Somewhere between 2530 have signed up. If youre inclined to believe in the cbo numbers that were going to get onethird, going to get onethird, 130, onethird over the next three years you can say we are on track. If youre someone who spent his grid and marketing as i have, and you look at an open enrollment that effectively lasts december, and into april, and 30 of the elves will sign up and 70 didnt, that tells me youve got a problem with the customers, that you need to worry about. So i would also, its also interesting as i talked to Insurance Agents who were signing people up, very big part of getting people signed up. As a talk to people who run call centers and Insurance Companies who are talking to the customers at the other end of the line, what theyre hearing is a lot of complaints about the product. About the offering. At the heart of the problems i think obamacare has, as economists and Health Policy experts and so forth, you can on your opinions on these things and the macroeconomics and the micro economics. I did a post on my blog not long ago, i recounted a marketing story from the 80s, about dog food, Dog Food Company went out and created this absolutely tide list doctor. Site is got involved. The manufacture people got involved. They went out and got the best consoles from all over the country and they created this new dog food. But they were not consulted a doctor. Nobody bought the dog food. They had this meeting. They brought that see the oh in and at the expense of consults in a country of why nobody is buying the doctor. Finally, some in turn back of the room raises his or her hand and says, mr. President and it may be that dogs dont like the dog food. And i think theres a problem here when you get 30 of the people walking away and 70 30 of the people signing up, 70 walking away. Random something important about obamacare. Obamacare is a monopoly. Theres not another place to buy Health Insurance. If youre a responsible person and want of Health Insurance for your family, you could have afforded it anyway, and you want to be that responsible person, theres only one place to buy it. If youre a person with preexisting additions and you can finally buy Health Insurance, theres only one place to buy it. So theres only one place to get this product. In addition to that, the government will pay a big portion of your costs. So youve got a product here that is a monopoly where somebody is paying a good share if not all of the costs for you to buy it. So you put out a product where you dont have to pay most of the cost and its the only place you can buy it and its the responsible thing to do to buy it, 70 pass on buying it. Theres a customer issue. The fundamental problem is that people are still after the subsidies expected to pay about 10 of afterta their aftertaxe for a plan with predeductibles. The average deductible is 2600. A bronze plan is 2500. Then we got the Narrow Networks. We dont understand the consequences either in the market or anywhere else of the Narrow Networks so far. There are a number of issues there. Take a look at the way the california individual Health Insurance market has rearranged itself. Where the insurance carriers with Narrow Networks have taken disproportionate marketshare and carriers with a less known networks have lost share. Clearly people in california voted with their feet towards the Narrow Networks. If you watch the covered california situation carefully you in the covered california had a hell of a time with a provider. If you want on the exchange to buy a plan, you will have an Impossible Task of figuring out who your doctor and hospital w was. But they bought Narrow Networks. Why . Because Narrow Networks will produce a price 25 cheaper, thats what. If they dont know whos in the network and its wifi cheaper, which direction do they move . The Narrow Networks are interesting from another perspective. In the Employee Benefits market for years weve been expanding, insurance covers of Large Employers, with highperformance networks. These on Narrow Networks where the Insurance Company or the Large Employer determines that the best provider is, the hives quality providers are very often the lowest cost providers. So you go find the centers for excellence for your heart procedures and so and so forth and to contract within inches to your people toward these networks are not because theyre cheaper but because he are lower cost and they are better. Thats not what we have here. What we have in these Narrow Networks in these exchanges is literally the Insurance Company mailing out a contract to all the doctors and hospitals in town with medicaid reimbursement rates, or Something Like that, with the assurance that if the doctor or hospital signs the contract they will get the exclusive business from the Insurance Company in the exchange and then see how many signed it and send it back. Thats t