Simplicity and “Obamacare”

‘Tis the gift to be simple, ‘tis the gift to be free,
‘Tis the gift to come down where we ought to be . . .

—Joseph Brackett, Old Shaker Hymn

Ask people what the most complex thing in human understanding is. Many might name Albert Einstein’s theory of relativity. At least that’s what many would have answered during the golden age of Yankee basic science, which is now a fading memory.

But they would be wrong. Einstein’s special theory of relativity is cleverly profound or, if you like, profoundly clever. But it’s not complex. It begins with a simple assumption that anyone can understand. And it proceeds to its now well-known but odd conclusions using no more math than high-school algebra.

At the time, a few well done experiments had suggested that the speed of light in a vacuum is an absolute speed limit in Nature. Nothing can go faster.

So unlike so many pundits and pols today, Einstein decided not to deny reality just because he didn’t like it. He accepted the odd notion that Nature has an absolute speed limit, which physicists denote by the lower-case letter “c.” Then he proceeded to deduce the consequences of that assumption.

First, Einstein did a simple “thought experiment.” Suppose, he thought, A runs toward B at a speed just a tad less than c, relative to some third frame of reference. But suppose B is also running toward A, relative to that same frame, at the same speed. What speed does B see when she looks at A, or vice versa, in her own frame of reference?

Common intuition says that the two speeds are additive, and that the relative velocity of A approaching B is just about twice c (less the two tads). But that result would break the rule that no speed can exceed c.

So Einstein reasoned that, when you get close to c, velocities don’t add linearly, that is, they don’t add in any simple, intuitive arithmetic way. They have to add non-linearly in such a way that the “sum” of two velocities never exceeds c.

Einstein didn’t have to work very hard to find out how. A contemporary mathematician named Konrad Lorenz had already done the math. He had developed a series of equations using no more complex math than multiplication, division, squares and square roots.

But Lorenz wasn’t a physicist. To him, the math he had developed was just an interesting curiosity. Einstein’s brilliant contribution was understanding that Lorenz’ math describes physical reality, at least when speeds approach the speed of light in a vacuum, c. When that happens, moving rulers get shorter, moving clocks slow down, and mass increases. The latter consequence, plus some basic physics, produced Einstein’s famous (and simple!) formula E = mc².

The essence of Einstein’s special theory of relativity is its speed-limit hypothesis and some half-dozen equations, all of which can comfortably fit on a single page. That single page encapsulates an apex of human thought: the abstract results of our puny brains’ collective effort to grasp our incomparably vaster Universe.

Einstein was not the only one to make things clear by making them simple. Our Founders did, too. The Constitution they gave us covers the structure of our government and—in the Bill of Rights—the basic values of our society. Depending on the size of the pages, the Constitution occupies, at most, only a few dozen. Our Bill of Rights, like Einstein’s special theory of relativity, fits comfortably on a single page.

So why does the “Obamacare” statute—formally known as the Affordable Care Act—reportedly fill over one thousand pages? Why indeed, when, unlike our Constitution and Bill of Rights, it covers only a single subject: health insurance? (You could ask the same about the Dodd-Frank bill, which runs some 2,300 pages and is supposed to prevent our banks from cratering the global economy again. But that’s a subject for another essay.)

Is something wrong with the length of “Obamacare”? Surely there is. At least five things.

First, a thousand pages easily exceed the patience and attention span of members of Congress and their staff, let alone the average voter. Someone should take a survey of the percentage of House and Senate members, including their senior staff, who ever actually read the whole bill, from cover to cover, whether before or after passage.

I would bet that the fraction would not exceed six percent of the 535 federal legislators (435 in the House and 100 in the Senate) then in office. That’s the same fraction of US Senators who actually read the then-recent National Intelligence Estimate before voting to go to war in Iraq. And that report was only ninety pages long.

There have been lots of jibes and jokes about the shortage of legislators who actually—even today!—have read the text of the Affordable Care Act. Should we sue all the ones who didn’t and haven’t for dereliction of duty, as John Boehner (never to be confused with Einstein!) is suing the President? Maybe. But before we hire the lawyers, read on.

The second reason to seek simplicity is that our human brains are the size of a large grapefruit. We just don’t have that much processing power. For anything complex and important, we rely on abstractions, which are fuzzy and inaccurate but all we’ve got.

Einstein relied on abstractions, too. Remember that simple assumption of a universal physical speed limit? It began his whole line of thinking about relativity.

Einstein’s thinking was deductive: discovering the consequences of that simple assumption in physical reality. Lawmakers’ thinking has to be inductive: they have to extract the most important principles of every bill and proposal and state them succinctly and clearly, as did our Founders. Otherwise, the signal gets lost in the noise.

And that’s the third reason for simplicity. Without direction as to a law’s basic principles, readers get lost, especially when the law is a thousand pages long. They are like the proverbial five old Indian blind men groping the elephant: each perceives something different. And so in the end they see different laws in the same text, because each picks out what is important, new or surprising to him or her. Then they argue at cross-purposes.

That’s human nature, and that’s one source of interminable controversy over the law, even over four years after its enactment. Different pols can’t agree on what the law says, let alone on what its consequences might be.

The fourth reason to keep things simple is simple lawyering. It doesn’t matter whether the document is a contract, a complaint or answer in a lawsuit, or a statute. The shorter and simpler it is—and the more it revolves around and states simple basic principles—the easier it becomes to avoid mistakes and inconsistencies. Conversely, the longer and less focused it is, the more mistakes are likely to arise.

And so we have the lawsuit that, unlike Boehner’s, is really important. In Halbig v. Burwell, a federal circuit court of appeals ruled that the federal government can’t legally subsidize insurance purchased on a federal exchange because part of the law says that subsidies require exchanges “established by the State.” If the Supreme Court upholds this view, a vital part of “Obamacare” will fall for nearly three-quarters of the states (36, to be exact), whose citizens get their insurance through the federal exchange.

Some anonymous drafter of the mostly unread bill—more likely an obscure and overworked staffer—failed to eliminate confusion over exchanges and subsidies, or to consider that states might default and leave the job to the federal government. And how could Congress avoid such blunders in a bill over a thousand pages long? It would take a single drafter of the caliber of Einstein to get every little detail internally consistent. Few members of Congress or their staff reach that level.

The final reason for simplicity is that complexity and the confusion it fosters distract attention from the thrust of a law—what its proponents most intended to accomplish. If the proponents of a law don’t prioritize its purposes and effects, who will?

Although nearly all the hoopla about the law has been about subsidies and getting more uninsured people insured, the most important provisions of the law, at least in the shorter term, are the ones that took effect earlier. Why are they important? Because they give applicants real insurance and, inevitably, increase its cost.

The most important of these provisions, by far, is the one that requires insurers to cover pre-existing conditions. Insurance that doesn’t really isn’t health insurance at all. Not only doesn’t it cover the full range of risks; it doesn’t cover the risks most likely to occur.

Like an old car, the human body has bad parts and good parts. Some organs and systems are weak and subject to recurring problems, while others are fine. (Whether this weakness results from bad genes, environmental challenges or lifetime abuse is the subject of ongoing research.) If an insurer excludes things that already have failed once or more, it “cherry picks” its risks by excluding those most likely to occur.

Take my case, for example. I’m a 69-year-old male in generally good health. I bicycle between twelve and twenty miles from one to three times a week. But I’ve had seven procedures on my urinary tract, and I’ve had two cancers removed from my skin and one from my bladder. If an insurer refused to cover my urinary tract or cancers because I’ve already had them, I would lack insurance for all the things most likely to happen. And the insurer would be insuring a fictional, wholly healthy 69-year-old male. What kind of insurance is that?

So when the right wing screamed that “Obamacare” would increase insurance rates, it had good reason. But the reason had nothing to do with the subsidies for poor people. It had to do with forcing the industry to offer real instead of sham insurance, i.e., covering all the risks, including the ones most likely to occur.

More risks, higher premiums. Duh. The same is true for the parts of “Obamacare” that outlawed lifetime and annual caps on insurance recoveries (within the overall policy value), and that allowed kids to stay on their parents’ policies through age 26. Those laws, too, increased insurers’ numerical risks by broadening insurance coverage. They therefore inevitably raised premiums.

The funny thing was that the insurance industry anticipated all this. Insurance rates rose precipitously, beginning in 2009, even before the law passed, and continuing up through 2013. Then, puzzlingly, they leveled off and, in some states and for some insureds, are even beginning to fall.

Why is that? Because the insurance industry covered its behind by anticipating increases needed to cover the new risks of recurrent pre-existing conditions, plus removing caps and covering up-through-26-year-olds on family policies. All those risks were calculable with existing data, while no one could (or still can) calculate the effect of subsidizing newcomers because no one could (or still can) predict who and how many will sign up.

So the entire pricing effect of “Obamacare” depended strongly on those provisions which took effect long before the federal exchange was up and running. The effect, if any, of subsidies and new patients on premiums is nascent at best, and still largely unknown.

But I digress. The subject of this essay is simplicity, which “Obamacare” lacks in the extreme. Had the proponents of this law thought harder before organizing and drafting it, they might have realized that its most important effects, at least initially, depended on its simplest and most comprehensible provisions: the ones that force insurers to provide real insurance.

Then they might have realized that subsidizing insurance for new customers would be an incredibly complex endeavor, involving at least fifty different jurisdictions with differing histories, markets and ideology. If so, they might have considered enumerating broad general principles for subsidies in the law, to be implemented by the states under federal regulation and supervision.

They might even have made explicit provision for a federal exchange in case the states failed or refused to create their own exchanges. After all, an “exchange” is just a remote or online marketplace. Isn’t a single, nationwide marketplace ipso facto more complete and more competitive than any state-limited one?

Of course, had they done that, the right wing would have screamed even harder about a new federal bureaucracy and doubled down on its lies about “death panels.” But would that be worse than where we are today, with the federal exchange at risk of being outlawed in the Supreme Court, after so much trouble and strife to set it up?

There is always a silver lining in every cloud. No matter what happens on appeal in Halbig v. Burwell, the Court will not likely strike down the provisions that make health insurance real, not sham. Nor will it likely nullify pre-existing insurance policies closed through the federal exchange, which are now solemn contracts between insureds and private insurance firms, not the government. Every insured should thank the President for that.

While we wait for the Court to deliberate, nothing prevents more uninsured people from signing up. And nothing prevents the federal exchange, the insurance companies and nonprofit groups or political actors from urging uninsured people to sign up before it might be too late. That’s free speech.

If that happens, the federal exchange’s job might be done before the Supreme Court rules. A huge cohort of new insureds might have signed up, with policy renewals offered annually by their private insurance companies. And the federal exchange might have been privatized, perhaps at a net gain to the government, and still be operating. Wouldn’t that be a sweet comeuppance for all the clueless pols, including Boeher, who have fought so hard for so long to keep more people from getting real insurance for their health?

Footnote 1: The discussion in this post addresses Einstein’s special theory of relativity, which explains the behavior of physical objects as they approach the speed of light. Einstein’s general theory of relativity is less simple; it required Einstein to develop a whole new branch of math called “tensor calculus.” But the impetus for the general theory was likewise simple: the assumption that gravity and acceleration are indistinguishable, i.e., that the properties of space-time itself, and not some hidden force, produce the effects of gravitational attraction among celestial (and other) bodies.

Footnote 2: The facts about this lawsuit come from this report in The Economist. Although a lawyer and law professor who have wrestled with long and complex statutes many times, I, too, quail at approaching the ACA’s thousand pages—a small data point that advances my general exhortation to simplicity. It’s much easier, in this case, to rely on the report of a reputable newspaper. But doesn’t that put a lot of power and responsibility in reporters’ hands? And how many, if any, reporters have actually read the whole thousand pages? I wonder.

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