1.01.10 - The Imposition -

[jaichind]

From Bloomberg BNA

AHIP State Issues Conference

Issues Discussed: Rising premiums, high out-of-pocket costs, limited provider networks, lack of subsidies for dependent coverage.
Employer Issues: Many are planning to cut hours and reduce workforce levels, a health insurance broker says.

No health insurer has received confirmation that anyone has enrolled in a health plan through the insurance marketplaces in New York or Minnesota, insurance industry lobbyists from the two states said Oct. 18 at a conference.

“We still don't have a number of enrollees,” Leslie Moran, senior vice president of the New York Health Plan Association in Albany, told the 2013 States Issues Conference, sponsored by America's Health Insurance Plans.

Moran and Julie Brunner, executive director of the Minnesota Council of Health Plans in St. Paul, said no benefit enrollment transaction forms, known as 834 forms, have been transmitted from their state-based marketplaces to health plans. The online health insurance marketplaces that opened Oct. 1 under the Affordable Care Act are also called exchanges.

Early the week of Oct. 14, insurers in New York were told by the state's marketplace officials that about 2,700 834 forms were ready to be transmitted, “but they found a significant error in half of them, so they were going to hold them,” Moran said. An estimated 2.7 million people in the state are uninsured, she said. Sixteen plans are being offered in the state's marketplace, she said.

Despite insurers not receiving confirmation of enrollments, Minnesota officials announced Oct. 16 that 406 commercial applications had been completed, Brunner said. Another 3,500 people in the state are likely to be enrolled in Medicaid under the ACA, and Minnesota marketplace officials are expecting to enroll 1.3 million uninsured people in 2014, she said. Five health plans are participating in the state's marketplace, she said.

Higher Premiums Likely in New York

Despite initial announcements by New York officials and President Barack Obama touting sharply declining insurance premiums, Moran warned that more people in the state are likely to see premium increases for plans purchased through the marketplaces than will see premium decreases. “We don't like to promote that too much,” she said.

Programs for “navigators” and assisters to conduct ACA education and outreach aren't fully functional yet in Minnesota, Brunner said. “The biggest challenge that the health plans have is managing the expectations that people have that ‘once I go on the website and enter my information, I'm in a health plan,' and that's just not true,” she said.

“People are actually calling health plans in Minnesota now saying, ‘I enrolled in you yesterday. I need to schedule surgery in January. Can you tell me if my physician's in the network?'” Brunner said.

A major concern of health plan executives in Minnesota is that “we're going to lose a lot of Medicaid enrollees in the process,” she said. “We're going to have people start falling through the cracks.”

Nevertheless, Brunner said, “The message that we really stuck to with the exchange organization at this point is that this is proceeding as we had basically expected; we did not expect to have a fast start out of the gate; that doing it right and having secure data transferred is the most important thing.”

California Brokers Unhappy

In California, health insurance brokers and agents are unhappy with the marketplace, Bill Hammett, president of Hammett Health Insurance Services, a health insurance brokerage firm in La Mesa, Calif., told the conference. Hammett is president of the San Diego chapter of the National Association of Health Underwriters.

“We were told coming into this that we were a totally invaluable resource to the exchanges, and we were going to be relied on very heavily, and as it's rolled out, that's just not the case,” Hammett said. Millions of people use agents for help to find plans, “yet the exchanges have given us only lip service,” he said.

About 17,000 licensed insurance agents are in the state, and only 1,200 are signed up to sell products through Covered California, the state marketplace, he said. At the same time, 5,400 “community organizers and union participants” are authorized to help people find coverage in the marketplace, he said. Including applications still being processed for brokers and community organizations, “Those people are going to outnumber us almost five to one,” he said.

“There is growing unrest in the agent population with the exchanges and how they're working with us,” Hammett said.

Affordability Problems Cited

Potential marketplace enrollees are beginning to discover problems with the ACA, Hammett said. If an employer offers coverage that meets ACA requirements for affordability, the employee's dependents aren't eligible for subsidies, he said. The ACA requires employers with the equivalent of at least 50 full-time employees to provide self-only health insurance plans that cost employees no more than 9.5 percent of their salary, and the cost of family plans isn't taken into consideration.

“People are very upset about this, because they're looking at the exchange price with no subsidy,” he said. “They can't afford that,” and they are unable to afford the cost of the employer's group policies covering dependents.
Hammett also warned that there might be potential problems with the level of income people report in applying for subsidies for marketplace plans. “Some of these people will just do what they have to do, and they'll get the subsidies they don't deserve and buy insurance plans, and they're going to have to pay for it later,” he said.

The agreement reached Oct. 16 to end the government shutdown and potential default included a provision requiring the Department of Health and Human Services to ensure that state marketplaces check the eligibility of people who apply for premium subsidies (201 HCDR, 10/17/13).

High Out-of-Pocket Costs

High out-of-pocket costs also are likely to come as a surprise, even though premiums seem low, and the public is also unaware of highly restrictive medical provider networks for some marketplace plans, Hammett said. “There are some major hospital providers that are just not in the networks, and that is something that will boil over very quickly when people start realizing that they bought a plan that was moderately affordable, but there's really only [the equivalent of] a Medicaid network they can go to,” he said.

Further, Hammett said, the low levels of penalties for not having coverage—the higher of $95 or 1 percent of income in 2014—compared with the higher cost of coverage is likely to lead to many young, healthy people going without coverage. “The fears that we're all thinking about the young, healthy people not enrolling in the plan, I'm seeing a lot of that,” he said.
In addition, Hammett said he is seeing that many employers with whom he works are reducing employee hours to below 30 hours per week or staying below the 50-employee threshold in order to avoid coverage requirements under the ACA. “They're just playing the system,” he said.

[jaichind]

See

http://www.gallup.com/poll/165500/uninsured-americans-unfamiliar-health-exchanges.aspx

71% of uninsured still not familiar with health care exchanges.

34% of uninsured  will choose to pay the fine versus 25% in Sept.

If this is the case then I suspect that the massive traffic on Obamacare in the first week or two are people like me, those with health insurance but taking a look at prices to prepare for the day when they might not have health insurance from work.  If this 34% are skewed toward the young and healthy then I the death spiral of Obamacare might be upon us if this keeps up over the next year or two. 

[jaichind]

That 34% will be skewed toward the Republican, not toward the young.  It makes no sense for a young person to pay a fine when they'd have subsidies helping pay for most their healthcare anyway. And spoken from first-hand knowledge: Once someone pays a RomneyCare/ObamaCare fine once, they sign up for insurance immediately the next year.

Paying money to get nothing is dumb when you can often pay less money and get something.

You could be right but I have strong feelings that this is not the case.

First, if 71% of the uninsured do not know much about health exchanges it is not realistic to expect them to be able to get enrolled.  I agree there might be a lot of interest in the health exchanges, at least the first few days, but my feelings are that they are mostly people with existing plans but are looking to switch.  The Obama regime reports that 476K people have enrolled in Obamacare.  But that is be clear what that means.  If you cannot see the prices of the plans on the exchange just to check them out then you must enroll just to see what the prices are.  A lot of people that enrolled, like me, are just to take a look at what plans are available and at what price.  Some, like me, are to plan for the future when we might retire early.  Others are people on existing group plans and are thinking about switching.  This explanation can reconcile between why there was so much activity for the few few days yet vast majority of uninsured have no knowledge of health exchanges.

As for the subsidies as an incentive.  Lets look at the numbers after factoring in subsidies.  The penalty for not having an insurance plan is 1% of MAGI.  Lets take a single person having a MAGI of $16.5K.  A silver plan would cost 3.65% of MAGI and even a bronze plan would be 1.03% of MAGI.  If we move that MAGI to $23K, then it would be 6.3% for a silver plan and 4.41% for a bronze plan.  And a MAGI of $34.5K, it would be 9.5% for a silver plan and 6.1% for a bronze plan.  So as long as a single healthy person makes more than $20K the incentive is not that great to pay for a plan if he or she feels that they will most likely not use it and the choice is to pay 1% or 3% of income.  Also do not discount the hassle factor.  The time it takes to enroll, sign up for, and then pay for insurance is significant.  And even after you get it and it gets used, there are a lot of paperwork to get the insurance to pay for healthcare.  The healthy $20K guy would just look at it and say, I will just pay 1% and not put up with this.  That is just as rational as the argument that you are paying 3% for something of value versus 1% that one gets nothing in return.

One way to see this play out is looking at the health providers.  If not enough young healthing people sign up for Obamacare then the insurance companies will lose money and will raise premiums leading to a death spiral.   On Friday UnitedHealth got cut to 'Hold' at Cantor Fitzgerald based on this trend and UnitedHealth stock prices fell 5.4%.  It is falling again today.  This should be a signal that experts on Wall Street are also getting skeptical that all these new young healthing customers will actually show up.  Of course, UnitedHealth will always figure out a way to make a profit and it will raise prices along the way and lead to the Obamacare death spiral.

[jaichind]

See

http://www.nytimes.com/2013/10/21/us/insurance-site-seen-needing-weeks-to-fix.html?_r=0

"One specialist said that as many as five million lines of software code may need to be rewritten before the Web site runs properly."

But as someone with a background in software I see what is below a lot and find it more disturbing than the previous statement.

"Administration officials approached the contractors last week to see if they could perform the necessary repairs and reboot the system by Nov. 1. However, that goal struck many contractors as unrealistic, at least for major components of the system."

When software is not built correctly and there is pressure to fix it by a certain unrealistic date, the chances are they will dig themselves deeper in the hole.  The rush to fix things at a speed which is not reasonable will cause more issues and is for sure never the right approach to solve the problem.  The right approach is to admit that this is a fiasco and it will take several months to fix and be done right.  

[jaichind]

Sounds like a good argument for ditching the web site and just giving everyone full Medicaid coverage using their social security card.

And the GOP can run against the Communist Obama next election.

[jaichind]

Sounds like a good argument for ditching the web site and just giving everyone full Medicaid coverage using their social security card.

To be fair, despite my schadenfreude for all these Obamacare troubles I agree there is a risk for those of us on the Economic Right.  The Obamacare plan, as much as it is a disaster, does contain certain aspects of it which are based on market forces.  And if the entire Obamacare systems fails it might make the implementation of a true market based solutions more difficult down the line when, according to us disciples of Adam Smith, the invsible hand of the market takes its revenge on Obama and his Obamacare.  I say this despite my utter contempt for the Obama regime.   

[jaichind]

Actually, I don't think that working out some sort of temporary hack (or a series of them) should necessarily be ruled out. The problem is they don't have six months. If they can't fully integrate systems, then they need to put the data into a temporary dump and then work out the integration later.

It is ironic. But the problem would be a lot worse had the website did not have scalability problems.  Because the website also had data integrity issues as well.  So had the the websites worked in taking in the data and passing it onto the insurance companies with these data integrity problems the the disaster would be even worse with people thinking they are one plan when they are on aother or people thinking they have health care insurance when they do not and vice versa.  Of course what would have been ideal would be to not take a political approach to this technical problem and just delay the rollout of the entire system.

[jaichind]

http://www.breitbart.com/Big-Government/2013/10/21/Obamacare-phone-number-fail

this is really funny.  The number Obama told people to call if they needed help at yesterday's press conference seems to be a dud as well.

"the Obamcare toll-free phone number was overloaded and immediately crashed. According to Lou Dubois of NBC News, “Call centers now appear overloaded due to volume. ‘Please call back.’”

[jaichind]

Aetna, third largest health insurer who stands to gain from Obamacare, down 9% from peak in Sept on the Obamacare rollout fiasco in October.  This is at a time where in the post-shutdown crisis market surged to a couple of percentage points beyond the Sept peak.

[jaichind]

This "tech surge" and “the best and the brightest” idea is not a good one.  Think about what you are saying to the current programmers on the project: “You all suck, and we're bringing in more expensive, better people to fix your crap. Please help them succeed."

At my company we tried such swat teams to try to push something out the door fast.  Given my role in the management structure of my company I often fought against it and won most of the time.  But someones I lose and it happends.  Almost always the long term result of doing this is negative.

[jaichind]

http://www.realclearpolitics.com/video/2013/10/24/obamacare_operator_fired_after_taking_call_from_hannity_hannity_to_give_her_a_years_salary.html

An Obamacare operator was fired after she blurted out that no one liked the new health insurance program during a live interview with conservative radio host Sean Hannity, it was reported Thursday.

[jaichind]

http://about.bgov.com/2013-10-24/late-it-cash-surge-foreshadowed-health-law-woes/

Bloomberg Gov research shows that

"looking at the full range of ACA-related contracts for just 10 firms, the BGOV analysis found more than $1 billion worth of contract awards."

So Obamacare fiasco website cost is now over $1 billion and counting. 

[jaichind]

http://www.realclearpolitics.com/video/2013/10/24/obamacare_operator_fired_after_taking_call_from_hannity_hannity_to_give_her_a_years_salary.html

An Obamacare operator was fired after she blurted out that no one liked the new health insurance program during a live interview with conservative radio host Sean Hannity, it was reported Thursday.

Good. Her job isn't to give television interviews

Fair enough.  But if we are really into holding people accountable, who will be held accountable for this entire Obamacare roll-out disaster.  Who will be fired for this?

[jaichind]

http://www.cbsnews.com/8301-505267_162-57609254/medicaid-enrollment-spike-a-threat-to-obamacare-structure/

Looks like all those people that signed up in the state exchanges are mostly Medicaid.  So even in states where state exchanges are working better the death spiral is still on. 

[jaichind]

http://www.bankrate.com/finance/insurance/health-insurance-poll-1113.aspx

Only one in 10 Americans (11% of the uninsured and nine percent of the overall population) say their health insurance situation has improved over the past year, according to a new Bankrate report.

And despite the fact that the health insurance exchanges opened about a month ago and hundreds of millions of dollars are being spent promoting them, almost half (47%) of uninsured Americans still do not know where they can get information on how the Affordable Care Act will affect them.

Thirty-six percent of Americans say their health care costs have increased over the past twelve months. Only five percent say they have decreased.
                   
Thirty-eight percent of the uninsured feel more negative about the Affordable Care Act than they did one year ago (versus 25% who feel more positive).

[jaichind]

I was able to finally log into the NY State healthcare exchange and made it far enough to actually see prices (it feels like I made it to some certain level in a video game.) As I looked over the prices and the plans I might consider when I retire early several years from now I did think of what would happen if in a certain year which I structured my investments so I would quality for Obamacare subsidies but somehow had a MAGI which was a few thousands too high. Because the nature of the Obamacare subsidy cliff it this scenario is where one is better off with a lower MAGI.

Again, just to explain this. For a family of 3 400% of FPL is $78100. The Silver plan I like on the exchange would be $1274 a month or $15288 a year. If such a family managed to get their MAGI to be exactly at $78100 then they will get Obamacare subsidies of ($15288 - $78100 * (9.5%)) = $7867. This means that as long as the MAGI of said family is ($78100+$7867) = $85986 or below, they are better off having a MAGI of $78100 once they consider the factor of Obamacare subsidies.

The thought experiment is what should someone in such a situation do. Say said family is sitting around in September of 2014 and their MAGI is headed toward $78100 plus say $4000 or $82100. This means they are $4000 above the threshold to get Obamacare subsidies and will be better off lowing their MAGI by $4000. How do they do this? Well, selling losers and capture losses would for sure lower MAGI. But say such holdings are not available or said family does not want to part such a holding. One way out, my initial thought, is to lose money, namely $4000, on purpose. But I thought this was too defeatist. I did come up with a strategy quickly after that. The solution is to buy $4000 worth of way out of money options that expire at end of December 2014. I would buy such an option with the feature that if it did become in the money the payoff would be 3 to 4. In other words, if the option expires out of the money you get the goal of losing $4000 and then getting a check from the government $7867 to make up for the loss of $4000 and more for a profit of $3767. If by good fortune the options finishes in the money then this investment would yield a profit of $8000 to $12000 (using the payoff assumptions of 3 to 4). One would have to pay taxes on this profit of course but even after that the net gain would exceed $3767.

In other words, the Obamacare subsidies cliff gave someone with MAGI just over 400% of FPL a free option. I have always been very negative on buying options as an investment strategy and I never bought one in my investment career. But I found a real legitimate use case for options.

[jaichind]

People are attached to their doctors, not their health insurance companies. What matters is whether a person can obtain equal or better coverage at the same or lower cost, while still keeping their current doctor. Without a doubt, this is possible. And if it's not, then calling your current plan "health insurance" is pretty generous.

Obamacare Bronze 'minimum-to-comply-by-law' plans aren't exactly loaded with frivolous extras.

Well, it depends.  It is certainly the case that if a person has to switch policies into one on Obamacare exchange, it is not clear at all the plan he or she will buy will have that doctor in the plan.  I will give you an example, I am "enrolled" in the NY State Obamacare exchange as I just wanted to see the prices.  There is a widget for one to check if a certain doctor is in the plan.  But that widget does work.  So someone in NY that has to switch now has no clue if he or she "gets to keep their doctor."   I agree that a bronze plan does not inherently exclude a particular doctor but the lack of transparency on the exchanges make it impossible to figure out which plan to buy to get the same doctor.  It is not even about cost.  It is not clear at all buying a more expensive plan will result in getting the doctor you want.   

[jaichind]

 Can you conclude - from what you know of and pay for your current policy of health vs. what Obama is selling - which has the best outcome for your (family) health?  

 I realize you're at the beginning; I too have looked, Obamacare is the same to slightly higher including subsidies than with what we have now. Slightly as in $100.00 or so a month.

 I was able to get info without submitting to Obama, Ar. has basic info with links to fine tune your position.

 Ar. having a private option is suppose to help the required to buy something a little easier to swallow.  

Well, we do not need Obamacare.  My megacorp has a very good generous health plan and I am very happy with it.  Main risk for me is that it will be taxed in 2018 as a cadillac health care plan.  I am looking just to plan out my future when I retire early 4-5 years from now so I will most likely avoid that as I am sure my megacorp will shift the cost of that tax to me the employee.  While I am very negative on Obamacare from a policy point of view, self-interest does not stop me from structuring my assets in a way that I can claim Obamacare subsidies every year or every other year until Medicare.  From my point of view, I am just clawing back the extra taxes Obama imposed on me, especially the Obamacare tax I am now paying.  I will collect these subsidies 4-5 years from now assuming Obamacare even exists and Obama and I will be even.  My wife's view is that it will not exist 4-5 years from now and told me not to count on it.  I said to her the way these government entitlement programs/give away always works is that it is impossible to roll back so I am pretty sure it will still be around 4-5 from now even if it will likely be a policy failure and cost way more than expected.  

The silver plan I am looking at will most likely cost $15K which I assume the cost will rise with inflation.  With good planning I should be able to contain my MAGI to around 300% of FPL which is also linked to inflation when I retire.  This would mean we will pay around $6K instead after subsidies.  Since I am retiring early I will have my young child as part of my household which in turn pushed up the FPL for my household which is also part of my retire early class warfare camouflage.   I might also do something where I will alternative between years to get 225% and 375% of FPL and on alternate years I would also qualify for extra subsides on out-of-pocket expenses which starts at 250% FPL.  But I will see how broken down the Obamacare system will be by then.  I suspect in 4-5 years the Obamacare subsidies system would have grown way out of control and subsidies will be there for only 300% of FPL in which case I might to alternate years to get subsidies.  

[jaichind]

I think I might have saw this in one of the posts, but I just love this:

Website to discuss the Obamcare website failure also failed

http://thecaucus.blogs.nytimes.com/2013/11/18/another-website-another-problem-for-obama/?_r=0

"Some supporters who tried to log in to hear President Obama defend his embattled health care law on Monday night were unable to hear him because the website of the group behind the call, Organizing for Action, failed to work for them."

[jaichind]

http://www.politico.com/story/2013/11/kathleen-sebelius-obamacare-website-crash-100152.html?hp=f1

"Sebelius was visiting a Miami medical center Tuesday and talking with local residents trying to sign up for health coverage. With a local CBS4 television camera rolling, a navigator helping a husband and wife with coverage attempted to send their application. Seconds later, the site failed — in full view of the crowd and attending media."

You cannot make this stuff up.  There most be some sort of GOP mole in the Obama regime. 

[jaichind]

http://www.valuepenguin.com/ppaca/exchanges

is a very good site to look up Obamacare prices across all states.  I did various Scenario Analysis of my future plans.  I wanted to figure out if Bronze or Platinum plans were better for me.  Of course prices will change.
                  
                 NY 55        NY 55(no sub)       NY 55 NK        FL 60                FL 64  
Br Min        $4,399.68   $13,756.68     $9,171.12   $16,152.24   $15,148.80
Plat Min    $12,987.84   $22,344.84   $14,896.56   $18,409.56   $17,265.96
Br Max      $17,099.68   $26,456.68   $21,871.12   $28,652.24   $27,648.80
Plat Max   $16,987.84   $26,344.84   $18,896.56   $22,409.56   $21,265.96

Br is bronze and Plat is Platinum.  Bronze has lower premiums but max out of pock is higher, and opposite for Platinum.  That leads to different min (which is premium costs) and max (premium + max out of pocket) annual costs. I looked at me getting a Obamacare plan at age 55 in NY state with and without subsides.  I also did NY at 55 if I had no kid (and no subsidies).  Then I ran the numbers for Florida where we plan to retire to after our kid goes to college and looked at the cost at age 60 and 64 where 60 we will still cover our child and at 64 we will not (he is out on his own by then.)
 
Net net, in NY with a kid, the best thing to do is get a Bronze plan.  Even Bronze plans have a out-of-pocket cap of $12.7K, so the worst case scenario for Bronze and Platinum are around the same but the best case Bronze is way better.  This is irrelevant if one gets subsidies or not since that is fixed relative to MAGI.   Without a kid in NY it is a different story, there the gap in premium costs between Bronze and Platinum narrows as to make a Platinum plan a better deal especially if you expect a significant amount of healthcare spending.

In FL, it is Platinum all the way.  I surmise that this is the case because in FL we have a lot of people on retirement but not get 65.  All of them crowd the private insurance market and most of them being cash strapped pick the Bronze plan to save on premiums.   This leads to the Bronze and Platinum premium gap to only around $2K per year with Platinum with much lower out of pocket caps.  

So, when we retire early, based on these numbers which I guess will change over time, we will get Bronze plan in NY and get Platinum plan in FL when we move there.  

It is also interesting to see huge gap between a NY 55 plan with and without a kid.  For Bronze it is $5K a year and for Platinum it is $7.5K.  Again, just like FL it is an issue of supply and demand.  NY is a place where there are a lot of people raising children so the relative cost of covering children are higher since the demand is so high.  In FL the extra cost of covering a child is almost nothing.

So lesson: If you are going to live in NY, do not have a kid or if you do then structure it so you get Obamacare subsidies.  If you are going to retire in FL, then you should have a relatively high net worth and high investment income so you can afford a Platinum plan.

[jaichind]

See

http://www.gallup.com/poll/166094/young-americans-least-familiar-healthcare-law.aspx

Overall Obamcare approval is 40-54.  But it is 40-59 for people who are familiar with the law and 41-43 for those not familiar with the law.  So as people learn more about the law the less they approve of it.

[jaichind]

http://www.bloomberg.com/news/2013-12-03/irs-needs-changes-to-avoid-health-law-fraud-audit-says.html

The audit found that “critical” pieces in security controls failed during testing and anti-fraud programs are still being developed.

“The IRS’s existing fraud detection system may not be capable of identifying ACA refund fraud or schemes prior to the issuance of tax return refunds,” the auditors wrote.


 

[jaichind]

Another Obama broken promise:

"My guiding principle is, and always has been, that consumers do better when there is choice and competition," President Obama said in a September 2009 speech laying out his vision for the Affordable Care Act.

Well, lets take a look at http://www.valuepenguin.com/ppaca/exchanges and look at the plans available state by state.

In 9 out of 51 states/DC, there is only one insurance provider on the Obamacare exchange.  So I am not sure what competition and comparison shopping Obama keeps on talking about would take place in these 9 states.  Furthermore, 16 states has only two insurance providers.  In the other 26 states/DC are there 3 or more insurance providers.  Note that even these numbers are artificially high as they count various health insurance co-ops many of whom would not survive the year.  Net result, less competition than before Obamacare and words Obama use about "competition" and "comparison shopping" becomes another non-truth uttered by Obama and his regime.

[jaichind]

http://www.washingtonpost.com/national/health-science/administration-reports-25percent-error-rate-on-obamacare-forms-from-october/2013/12/06/695d508e-5ea8-11e3-be07-006c776266ed_story.html

"estimated one in four Americans who chose health plans through the online federal marketplace in October and November had computer-generated errors"

"Currently, the Web site, HealthCare.gov, is making mistakes in the records of an estimated one in 10 people signing up for a health plan"

"Once the online system is working more fully, it will include an automated way — called “reconciliation” — for the government and participating health plans to compare their lists of who has signed up. That process is supposed to start the middle of this month, but the required part of the system is not yet built. "

Error rate of 10% does not sound so great either.  And the system to reconcile this is not built yet.