Close enough for government work???

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Money Down the ToiletI would guess that most readers have heard that nostrum.  “Close enough for government work,” at least in my life, has always referred to a job not particularly well done, not necessarily on time and probably over budget by at least a factor of two or three.

The Obama administration has ushered in a “new normal” in just about everything they’ve touched.  The “most transparent” administration morphed into the most secretive within hours of the first inauguration.  I could go on, but you already know the story.

Which brings us to the so-called Affordable Care Act, aka ObamaCare.  You remember, the bill we had to pass so we could find out what was in it.  The bill that was going to reduce your healthcare cost by $2,500 each and every year.  How’s that working out for you?

Well, it turns out that the President’s estimate of the impact on your individual health care cost was pretty good, at least compared to the cost of developing the “Health Insurance Exchange.”  Let’s quickly review what the HIE is, from the Center for Consumer Information & Insurance Oversight.

The Affordable Care Act helps create a competitive private health insurance market through the creation of Affordable Insurance Exchanges. These State-based, competitive marketplaces, which launch in 2014, will provide millions of Americans and small businesses with “one-stop shopping” for affordable coverage. They will also provide the sole venue where Members of Congress will get their health insurance.

CCIIO has proposed rules outlining a framework that will enable States to build Affordable Insurance Exchanges. For detailed information about the Exchanges, visit

Short form, it’s a website where you buy insurance.  Kinda like going to Geico online to buy auto insurance or homeowners insurance.  Or Esurance to buy health insurance or auto or homeowners insurance.

Now I’ll admit that I’m not a $1,000 per hour expert in building complex websites – these are VERY complex websites – but I have significant experience managing multimillion dollar projects in Fortune 50 companies and in my own businesses.  I didn’t just fall off the turnip truck.

If this was my project, and the original assumption for ObamaCare was that every state would have an exchange, I would build one website, one set of data bases and one interface that could be used for each state.  That much, if you have 15 minutes of business experience, should be a given.

Well, since nobody in the President’s administration – well at least 92% of those nobodies – ever held a real job, they didn’t think of that.  They probably thought a national website for insurance would be too complicated or something.

Bob Laszewski did the hard work for us, and here’s what he found out.

…I took a look at what it cost to launch the private insurance marketing site, Esurance. That company sells not only health insurance but also things like homeowners and auto insurance across the country. When I put my zip code into their system along with my age, they offered me 87 different health plans from all the big players in my area. …

Privately funded Esurance began its multi-product national web business in 1998 with an initial $5.5 million round of venture fund investment in 1999 and a second round of $34 million a few months later.

The start-up experience of other major web companies is also instructive. Facebook received $13.7 million to launch in 2005. eBay was founded in 1995 and received its first venture money in 1997––$6.7 million.

So Esurance got off the ground in the late 90s for about $40 million.  Facebook and eBay were less, but they’re different products and I really don’t know how to make a rational comparison.  Anyway, let’s say the ObamaCare exchanges are three times as complex because of the interfaces with the IRS and Medicaid.  And we’ll throw in an inflation factor of 2x since Esurance was done in the 90s.

Let’s do some simple math.  I love simple math.

$40M * 2 (inflation) = $80M.

$80M * 3 (complexity) = $240M.

Let’s now be generous because it’s “government work” so we’ll toss in another 2x factor for sloth and stupidity.  That brings the projected cost to $480M.  In round numbers, that’s half a billion dollars.  Close your eyes and picture half a billion buckaroos.  OK, got it?  Let’s move on to the real world of Barack Obama.

So far California has received $910 million in federal grants to launch its new health insurance exchange under the Affordable Care Act (“Obamacare”). …

As many as 17 states are going to be setting up their own health insurance exchanges under the new law and the feds have so far released $3.4 billion to the states to build them. Little Vermont has received $124 million so far, Kentucky $253 million, and Oregon $242 million, for example. I wonder what the per person cost of exchange enrollment in Vermont will be?

If you have a strong stomach and lots of adult beverages you should read Robert’s whole article.  But don’t do it unless you’re well fortified and have nothing to do for the next few hours.   Or days.

I always like to have a point when I write an article.  This evening I’ve got a couple.

  • Barack Obama and his minions are the best I’ve ever seen at consolidating power into their hands.
  • They also have a combined IQ of maybe 7.  That’s seven.  Not seven hundred.  Seven.
  • Your health insurance is going to get a whole lot more expensive, and tomorrow I’ll have more on that subject.
  • Even though you’re going to be paying two or three times what you paid last year for health insurance, your health CARE is going to get substantially worse.

The upside to crappy, expensive health care is that you’re not likely to live all that long which will reduce the long term cost because old people like me are more expensive than young punks like you.

Get the idea?  If you do, do something about it.  I’ll have more on that later.  Promise.

close enough for government workThe Free Dictionary: and good enough for government work sufficiently close; done just well enough.

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