AHCA: Insured to Rise by 7M by 2026 – CBO Misses Power of Free Plans

The CBO generally performs careful, in depth analyses – but their approach is susceptible to inaccuracy when policy proposals differ sharply from existing norms. The CBO projects that over 24m individuals will lose insurance coverage as a result of the AHCA, as older individuals and Medicaid recipients lose insurance faster than younger individuals gain it. This projection misses the power of free plans, however. The table below shows how much different age groups might pay for coverage under the AHCA, with prices based on 2017 ACA exchange prices for states with low (Oregon), medium (Ohio), and high (Nebraska) insurance costs [1]. As the table shows, the AHCA tax credits can provide catastrophic coverage to the majority of Americans below age 45.

Monthly Cost after AHCA Tax Credit
(Plan cost as found on healthcare.gov, cheapest available plan)
State Age 20 Age 30 Age 40 Age 50 Age 60 Family Ages 40,10,8 Family Ages 30,30,5,3
Oregon (Low Cost State, Zip 97035 Used) Free ($112) Free ($208) Free ($234) $35 ($327) $160 ($493) Free
($466)
Free
($648)
Ohio (Medium Cost State, Zip 43004 Used) Free ($121) $12 ($216) Free ($244) $49 ($341) $186 ($519) Free
($487)
Free
($677)
Nebraska (High Cost State, Zip 68010 Used) Free ($131) $66 ($274) $59 ($309) $139 ($431) $323 ($656) $33 ($616) $105 ($855)

Using the information compiled above, we can estimate the change in uninsured rates for each of the groups in the chart below. For age groups below 40, the uninsured rate is projected to drop close to the same level as that of children below 19, since these groups will have access to free plans paid for by tax credits (and insurance companies will market these subsidized free plans mercilessly). For age groups above 45, the uninsured rate will rise, though not quite to pre-ACA levels, when no support was provided.

Projected Uninsured Rate Under AHCAThe CBO estimates that 14 million Americans will lose Medicaid coverage, and that 9 million more will lose either individual or employer-based coverage.

Using population estimates for 2026, I calculate that the number of insured Americans aged 19-34 rises by 7 million, aged 35-44 rises by roughly 2 million, and aged 45-64 drops by roughly 2 million [2]. While it’s important to note that these plans will be much less generous than ACA-subsidized plans, the total number of insured actually rises by around 7 million under these estimates. The GOP will have installed universal, nearly-free catastrophic plans as the future of American health care – if the AHCA passes, as Mssrs. Trump and Ryan continue their struggle to get it through Congress.

P.S. If you are interested to find out more about how the AHCA might impact you or your clients’ investments, my company HiddenLevers has modeled that in our TrumpCare scenarios. Have a look through one of our free demo accounts.

 

[1] The 2017 ACA prices are a reasonable guide as the Trump administration plans to relax the essential benefits associated with plans, and to widen the max price differential between plans for young and old. The risk pool under the AHCA will also likely be healthier, as young, healthy Americans will be drawn into free AHCA plans – because they are free.

[2] Roughly 23% of the population is aged 19-34, and a 9% point drop in uninsured rate for this group in 2026, translates to a rise of 7m more insured Americans. A similar calculation for the 35-44 group yields another 2m insured Americans, while the 2.5% rise in uninsured among older Americans yields a loss of insurance for 2 million. The CBO appears not to contemplate that many of those losing Medicaid will receive tax credits sufficient to provide them with free catastrophic plans, as shown in the table above. This mitigates the Medicaid cuts to some extent.

[3] The original chart above can be found here at the CommonWealth Fund.

TrumpCare (AHCA) – Welcome to Universal Catastrophic Health Insurance

The AHCA would move the USA toward universal catastrophic healthcare coverage, by enabling insurance companies to sign up individuals to $0 monthly premium plans with high deductibles and limited coverage.

While healthcare analysts have been in overdrive commenting on the new GOP health plan, it appears that some key points have been lost in the noise. Whether on Medicaid, total enrollment, or tax credits, it seems that many analysts fail to understand the large-scale implications of the bill. As written, the AHCA has the potential to be transformative – it would retain the goal of universal coverage, while shifting tax credits toward universal high deductible insurance. If fully implemented, the AHCA could actually lead to gains in coverage – but the US healthcare market would be transformed by a move toward high deductible catastrophic coverage.

AHCA Key Changes:

  • Covered Benefits: The AHCA does not change the essential benefits list, but Secretary Price is interested in reducing essential benefits to lower costs.
  • Tax Credits: Tax credits will be less generous, but will cover more of the population, potentially leading to a shift toward catastrophic plans.
  • Medicaid: The Medicaid expansion ends after 2019, but tax credits will be available to all lower and middle-income Americans.
  • Employer Coverage: AHCA creates a strong incentive for employers to drop coverage, since most American workers will receive tax credits.
  • Universality: AHCA provides tax credits to virtually all Americans without other coverage, cementing the goal of universal health care in the USA.
Detailed Findings:

Covered Benefits:
With the exception of abortion coverage, the AHCA does not change the essential benefits under the ACA. HHS Secretary Tom Price has indicated that he will reduce regulations that increase costs – he can do this by limiting the definition of essential benefits.

Tom Price has indicated on multiple occasions that HHS will seek to reduce regulations on health insurance markets, and recently both he and President Trump indicated that these changes would be part of “phase 2 & 3” of their healthcare overhaul. In the past Secretary Price has indicated that he will seek to specifically limit the essential benefits requirement while at HHS.

The AHCA is particularly punitive towards abortion, barring the use of tax credits for any plan that covers abortion services (page 72 of bill pdf).

Tax Credits:
The AHCA offers up to $14k in tax credits per family, at 2k-4k per person depending on age (pages 90-92 of pdf). It also enables insurance companies to claim tax credits on behalf of enrollees, enabling them to offer cheap or free plans to the public.

Much has been written on winners and losers with the proposed tax credit changes. Analysts both left and right fear many will lose insurance. But look at page 106 of the bill: “Not later than January 1, 2020, the Secretary … shall establish a program … for making payments to providers of eligible health insurance on behalf of tax payers eligible for the credit under section 36C.”

Consider what this means – insurance companies will be paid between $2000 and $14,000 per year for each enrollment. In a similar situation in the for-profit university industry, tuition essentially matched federal loan programs, creating a no-money-down product for students. With the AHCA, insurers will be strongly incentivized by the market to offer $0 premium plans in order to maximize their signups of younger individuals in particular.

With the change of young-old ratio to 5:1 (page 66), and Tom Price’s expected reduction of essential benefits, new catastrophic plans will likely flood the market, providing a no cost option for many. See Appendix I for specific examples using 2017 exchange pricing.

Medicaid:
The AHCA ends the Medicaid expansion in 2019, but states may have some incentivize to jump in now, because the future funding they receive is based on the number of enrollees at the end of 2019. Beginning in 2020 the Medicaid expansion will be repealed, and only those enrolled under pre-ACA rules (with stricter income and asset tests) can be newly enrolled into Medicaid.

The AHCA does close a gap caused in non-Medicaid expansion states, where many workers make too much to qualify for traditional Medicaid, but too little to qualify for ACA subsidies. These individuals will qualify for the new AHCA tax credits.

Employer Coverage:
The AHCA removes penalties for not providing insurance (page 84 of bill pdf), and could encourage employers to drop coverage as it provides tax credits to a much larger range of working age Americans.

Per the Kaiser Foundation, the average employer contribution to individual employee healthcare is around $4800, with the employee contributing around $1200. At a 25% federal tax rate, this leads to a tax deduction value of $1500, versus a tax credit of $3000 for the median-age American worker. For family coverage, a tax deduction value (25% tax bracket) of roughly $4500 compares to a tax credit of $9000 for a family of four with adults in their 30s. In both cases, both the employer and employee would benefit if the employer dropped coverage, raised wages, and let the employee take advantage of the tax credit.

Appendix II presents a fully worked example for a family of four making $100k per year, and shows that the family would likely benefit under AHCA changes.

Universality:

The AHCA offers tax credits to all Americans without employer-based healthcare (except those with higher incomes), and as a result the AHCA accepts the ACA’s premise of universal health insurance.

The only Americans excluded from the new AHCA tax credits are those already receiving healthcare from a government program (Medicare, Medicaid, VA, etc) or from employer-based coverage (page 97 of bill pdf).

The GOP has produced a plan that implicitly accepts that universal healthcare is here to stay. The end game (relative to the ACA) will look very different, however, with large swaths of the population covered by high-deductible catastrophic plans.

Appendix I: Are $0 premiums for catastrophic plans really possible?

Is $2000 ($166/month) sufficient to offer a “free” plan to a young adult, or $10,000 ($833/month) sufficient to offer a “free” plan to a family of 4?

Using Healthcare.gov, in the Atlanta area the current cheapest plan for age 21 is exactly 1/3 of the $597 charged to a 64 year old, as a result of the ACA 3:1 limit on costs for older Americans. A bronze plan for age 20 is only $126/month in Atlanta, since the 3:1 limit doesn’t apply below age 21 (even in New York City, individual catastrophic plans are available from around $165/month). Since the AHCA raises the ratio limit to 5:1, this shows how $0 plans will fit within the $2000 tax credit.

How about for a family of four ages 31, 31, 4, and 2? This priced out at $713/month in Atlanta, below the $10k AHCA annual tax credit. Since the AHCA allows excess tax credits to be placed into an HSA, the family could bank around $1500 per year toward future medical expenses while paying $0 in premiums. In New York City, the family premium would be around $1050/month, leaving the family bearing around $200/month in premiums – but this is before accounting for the impact of the new 5:1 ratio and curtailment of essential benefits, which would likely bring net costs to $0 even in NYC.

What about older Americans? A $4000 ($333/month) tax credit will not cover a single 64 year-old’s $600/month premium in Atlanta. If HHS substantially reduces essential benefits, that may close the gap, but with a corresponding loss of benefits. Pre-Medicare age older Americans are clearly the biggest losers under the AHCA reform. But if the AHCA is able to substantially increase enrollment by the young and healthy due to $0 premiums, this may enable more affordable plans further up the age spectrum.

Appendix II: Why Employers May Drop Coverage – A Specific Example

Let’s consider again a family of four, ages 31, 31, 4, and 2. Using Kaiser numbers, on average the family and their employer spent a total around $18,000 on health insurance premiums, with the employer contributing roughly $13,000 of that amount. In the 25% tax bracket, the family is receiving $4500 in value from the existing tax deduction. In total, the family is spending about $500 out of pocket on health insurance when employer assistance and tax deductions are considered.

What if the employer were to drop coverage, enabling the family to receive a $9k AHCA tax credit, and to raise the employee’s salary by $13,000 instead? The employee would receive $9750 in new after-tax income (considering only a 25% federal rate) plus $9000 in tax credits, or $18,750 total. Assuming similar premiums, the family would then spend $18,000 on health insurance, leaving $750 unspent. In total the family might come out $1250 ahead versus the existing system, and the employer would be able to offload the risk and expense of managing benefits.

The GOP Civil War on Taxes

Republicans love tax cuts, and both President Trump and Speaker Ryan have set their sights on lowering both personal and corporate income tax rates. But some Republicans also like controlling the budget deficit, while others favor defense spending or immigration control. How can the GOP cut tax rates, raise defense spending and immigration enforcement, and control the budget deficit? Here’s the heart of the problem: the federal government gets roughly $1.4T from income taxes, $440B from corporate income taxes and capital gains, $1.1T from payroll taxes, and smaller amounts from other sources [1]. The tax plan under consideration will substantially cut the first two sources, without raising the other categories. How can such a tax plan be implemented without blowing up the budget deficit?

The evolving Trump-Ryan plan bridges this gap by introducing a new category: a border adjustment tax on imports. If all 2.7T in US imports were taxed at 20%, this could raise over $500B per year, providing a source for big tax cuts (though still not enough to pay for the tax cuts proposed). But there’s a problem with this idea – will 50 Republican senators vote for it?

The National Retail Federation has come out strongly against the plan, as have the Koch brothers, whose companies participate heavily in international trade. The Kochs are focusing their battle charge in 15 states where they may be able to sway Senate votes. Meanwhile, with retail giant WalMart strongly opposed, will the senators from Wal-Mart… err Arkansas be on board?

Hence we have a GOP civil war, pitting major exporters like Boeing, Oracle, and GE against retailers and other importers, and pitting nationalist Republicans versus traditional free-trade Republicans.

Trump and Ryan can only spare two votes in the Senate – will they be able to keep everyone on board? While the plan could stimulate US growth through tax cuts and favoring US production, it may also trigger a trade war that nullifies much of its benefit. There’s also the essential nature of the import tax – it is effectively introducing a new US consumption tax for the first time. Consumption taxes have been on the GOP radar for some time, as they tend to shift tax burdens down the income scale, and to reduce taxes on the wealthy. But is Trump’s base ready to pay an extra 40 cents at the pump every day, when many of them won’t see a huge tax cut [2]? Let the Republican tax civil war begin.

[1] The CBO provides a detailed breakdown of revenues here. I have combined corporate taxes and capital gains into one category, as both are taxes on capital.

[2] Roughly 50% of oil is still imported into the US, so a border adjustment tax could disproportionately increase oil prices.

What Can Be Done About Skyrocketing Drug Prices?

The American government and even major insurers actually have a lot of levers they can pull to lower drug costs – but do politicians, insurers, and employers have the courage to try?

The drumbeat of overpriced-drug stories has been continuous in America of late, from Martin Shkreli’s 5400% price hike last year, to the recent price hike and subsequent backpedaling of Mylan with respect to the EpiPen. With growing outrage over skyrocketing drug prices, it’s worth asking – what can be done about it? Drug pricing is not subject to typical market forces since a new drug often has exactly 0 direct competitors – enabling a drug company to set virtually any price. New cancer drugs often start list pricing at $300,000 per year, while groundbreaking new Hepatitis-C treatments like Gilead’s Sovaldi started out at $84,000 for a short term (curative) course of treatment. Insurance companies (and major employers) have been unwilling to say no, swallowing each hike and passing it on in higher premiums. Medicare, Medicaid, the VA, and other public entities have been banned from negotiating prices, leaving them powerless to get a better deal for those receiving care through their programs. Here are a few ideas on how to break the logjam, in order of increasing potential savings:

1. The Anti-Monopoly Approach

Making drugs, and in particular so-called small molecule drugs, is actually both inexpensive and easy. The primary protection that drug makers use to enforce their monopoly position on new drugs is the patent system. While this arguably makes sense for new drugs, what about long-generic drugs? In recent years certain drug companies (e.g. Valeant) began specializing in buying up the manufacturers of old drugs and immediately hiking prices. After gaining a monopoly position it became easy to hike prices by 50-100% per year and extract huge profits, while new entrants were stymied by
the FDA approval process required to certify the efficacy of their drug version. Why not streamline the FDA approval rules for generic drug manufacture? If a drug is tested and shown to be chemically identical, how much further testing is really necessary?

Alternately, the Department of Justice or FTC could bring suit to halt acquisitions which would leave zero competitors in the market for a generic drug. Special pharmacies called compounding pharmacies are also capable of making many drug compounds. Why not
allow compounding pharmacies to compete across all generic drugs, or specifically contract with them to make generic equivalents for the VA system or Medicaid system?

2. The “Title IX” Approach

Private American colleges and universities are not actually required by law to provide equity in women’s sports, or to follow any of a wide range of Department of Education edicts. The catch? In order to receive federal funding, institutions of higher education must comply with these rules. Since virtually all colleges make use of varying forms of federal assistance, they fall into line.

The American pharmaceutical industry does very little original research – most innovations originate in the university system, and most of the research funding (over $21B per year) comes from the National Institutes of Health [1]. The American government could utilize this lever to strongly influence drug pricing. Pharmaceutical companies might be required to adhere to certain pricing guidelines if they wished to license research originating from NIH funding.

Those guidelines might require drug makers to release drugs into the generic market on an accelerated timeline, for instance. Or the rules might require that drug makers adhere to a value-based pricing approach, as described further below. Drug makers could be required to pay a tiered tax on drug sales to fund NIH research – a tax of 25% on prices above $1000/patient/month and 50% above $4000/patient/month could simultaneously fund future research and encourage drug makers to keep pricing down. The advantage of the “Title IX” approach is that it preserves the liberty of drug companies – if they don’t want to conform with the rules, they can simply do their own basic research. Fiscal conservatives might find this approach palatable as it directly charges users (drug companies) for the government programs they use, and lowers the deficit in the process.

3. The Value-Based Approach

If insurers and government buyers (Medicare/Medicaid/VA) all insisted on paying for value, pharmaceutical companies might be compelled to go along. How do you define value? The UK’s NICE measures the efficacy of medical treatments by attempting to measure the number of “quality-adjusted life years” provided by that treatment. If a cancer drug postpones death by 2 years on average, and has mild side effects, then it can be said to provide 2 years of QALY. The NIH takes this a step further by quantifying how much it will pay per QALY (currently around 25,000 pounds per year), and it sets prices
on drugs using this approach.

American buyers could emulate this approach by offering to pay for measured improvements in outcomes. If a new cancer drug extends life by 2 years, but existing cancer drugs extend life by 1.5 years, then the value of the new drug is an additional half-year of life. Drug buyers could offer to pay a premium for the new drug based on this degree of improvement, and no more. Buyers could also use this as a way to foster competition between older and newer generations of drugs. The older drug is 75% as effective, so it can be placed into competition with the new drug, but at a discount. Express Scripts took this approach in the Hepatitis-C market and was among the first buyers to find a way to push back against Gilead’s $1000 per-pill asking price for Sovaldi.

Conclusion

As long insurers are happy to pass rising costs along in the form of higher premiums, and American politicians remain beholden to the pharmaceutical lobby, nothing will change. But the ideas outlined above show that America doesn’t need European style price controls to break the drug price spiral – a combination of relatively small policy changes and insurers’ willingness to negotiate are all that is required.

 

[1] This article investigates the breakdown of basic pharmaceutical research in detail, and concludes that big pharma companies contribute less than 25% of research dollars in the US, with most of the balance coming from the NIH.

Fix Healthcare.gov by turning it into Turbotax

Go to www.irs.gov. Look for the File Now button to file your taxes. You’ll find a list of options for filing, including software companies providing tax filing web sites and software. The IRS makes fillable online tax forms, and the instructions for completing them – so why not cut out the middleman and deliver a free irs.gov tax filing portal? Healthcare.gov is just the latest answer to that question – the government has a poor track record of delivering technology solutions, with IRS, FBI, and DHS systems as just a few examples of failure [1].

The department (Health & Human Services) managing the Obamacare rollout should take a lesson from the IRS: if you set the rules, and let the private market deliver the software, you can offload the expense and risk of technology development while still receiving the benefits of automation. Turbotax and its competitors receive not one dime from the IRS, and yet have taken a huge share in the multi-billion dollar tax filing preparation market. In addition, these companies have agreed to give their software away for free to low-income individuals, eliminating any criticism on fairness or access grounds.

Healthcare.gov could easily move to the same model, and here’s the crazy part – several companies, including eHealthInsurance.com and GetInsured.com, already have healthcare exchanges certified to sell ACA plans WITH subsidies! While any licensed insurance agent (including websites) can sell ACA-compliant policies, a handful have built out their technology to work with the federal government and provide access to subsidized ACA insurance. Rather than competing with these firms, Healthcare.gov could terminate many of its bloated IT contracts and simply list certified private exchanges on its site. These exchanges would provide a free shopping experience for consumers, and earn a commission on policies sold in a manner similar to the financing system for healthcare.gov itself [2]. Let HHS & CMS employees set and administer the rules of the ACA, and leave the exchanges themselves to the private sector – leading to benefits for taxpayers and health insurance shoppers alike.

[1] This paper found that 70% of government-run software projects failed to meet stated objectives. Government contract reform has become a hot topic as a result of healthcare.gov’s failure, but these problems have been going on for years.

[2] The ACA exchanges will charge insurers 3.5% of each policy premium sold on exchanges to finance the marketplace. While this “user fee” is lower than the commissions many private insurance brokers receive, many would likely still jump at the opportunity given the size of the new market on offer (perhaps 7 million individual policies through 2014).

Gun Control And Mass Shootings: Would Lives Be Saved?

An analysis of every US mass shooting over the past 30 years shows that two small policy changes, restricting high-capacity magazines and introducing stringent background checks, might have saved over 500 injuries and deaths, reducing total casualties in mass shootings by 50%.

Various proposals have been set forth since 2012’s numerous mass shootings, ranging from much stricter gun regulations to arming more individuals in public spaces. Starting from Mother Jones’ list of US mass shootings over the past 30 years, I analyzed the potential impact of two proposals in particular: would a ban on high-capacity gun magazines have reduced casualties, and would stringent background checks of gun purchasers have reduced the number of shootings? I researched the incidents surrounding each shooting to determine whether each proposal would have had any impact. The data are summarized in the table below, with the full research spreadsheet available here.

Shooting Deaths Injuries Lives Saved Injuries Prevented Weapon Legally Acquired? Notes
Totals: 459 481 250 324 Legal in 58 of 63 cases 54% of deaths and 67% of injuries might have been prevented with the policies analyzed.
Newtown, CT Sandy Hook Elementary 27 2 17 0 Yes – legal weapons in same household The shooter’s rampage was stopped by a quick police response. If the shooter had to reload 3 times as often, he would hit many less victims, as he fired on each victim multiple times.
Minneapolis, MN Sign Company 6 2 1 0 Yes The shooter reloaded at least once during the shooting, and initially struggled with victims.
Oak Creek, WI Sikh Temple 6 4 3 2 Yes In a public setting with many adults, it’s possible shooter would have been stopped while attempting to reload, or would have retreated outside more quickly if he had less capacity.
Aurora, CO Theater 12 59 12 59 Yes A lucky form of weapon capacity control prevented a larger disaster, as the shooter’s weapon jammed and he was only able to fire roughly 1/3 of the 100 round magazine. A properly integrated background check system might have stopped the incident entirely.
Seattle, WA Cafe 5 1 0 0 Yes It’s not clear that the gunman ever needed to reload, and though he had a history of mental health problems, he was never treated and never convicted of a felony.
Oakland, CA – Oikos University 7 3 7 3 Yes HCM limit would have no impact here, but the shooter was expelled from school for behavioral issues, which might have been caught if this data were submitted to a comprehensive background check system.
Atlanta, GA – Health Spa 4 0 4 0 Yes HCM limit and background check would have no impact here
Seal Beach, CA – Salon 8 1 3 0 Yes The shooter reloaded during the shooting per police reports, so lowering weapon capacity would likely have lowered casualties.
Carson City, NV – IHOP 4 7 2 3 Yes The shooter fired over 30 rounds per eyewitness accounts – lower capacity would have constrained him.
Tucson, AZ – Giffords shooting 6 13 4 9 Yes Shooter was tackled and stopped while he tried to reload – direct evidence that lower capacity would have decreased the toll.
Manchester, CT – Beer Company 8 2 4 1 Yes Shooter used two weapons and fired multiple rounds at many victims – had he been limited, he would have run out of ammunition earlier
Lakewood, WA – police officer shooting 4 0 0 0 No Capacity limits might not have helped, as the shooter fired on four victims seated at one table, and hit all of them with his initial salvo.
Ford Hood, TX – army base 13 29 9 19 Yes Shooter reloaded many times, and 30 round magazines enabled him to fire roughly 170 rounds before being shot himself by military police. Multiple soldiers attempted to charge the shooter – if he had only a 10 round magazine, it’s entirely possible that he would have been tackled and stopped upon initial reload.
Binghamton, NY – civic association 13 4 9 3 Yes Shooter fired 99 rounds in total – this would likelybeen reduced if his weapon capacity were 1/3 as large
Carthage, NC – nursing home 8 3 0 0 Yes Since shooter used multiple weapons and never reloaded, it’s unlikely capacity limits would have mattered.
Henderson, KY – Atlantis Plastics 5 1 0 0 Yes Shooter did not use a high capacity weapon
Dekalb, IL – Northern Illinois University 5 17 5 17 Yes This incident’s casualty count is quite low because the shooter first fired with a very low capacity weapon, his 6-round shotgun – enabling many students to escape the classroom. Shooter also had a long, documented mental health history.
Kirkwood, MO – City Council 6 1 0 0 Yes Shooter used low-capacity revolver initially, and took a higher capacity weapon from a victim (police officer).
Omaha, NE – Westroads Mall 8 4 5 3 No Shooter appears to have emptied one magazine and then taken his own life.
Crandon, WI – sheriff’s rampage 6 1 0 0 Yes Shooter used a service weapon, so proposed rules/limitations would have had no effect.
Blacksburg, VA – Va. Tech 32 23 32 23 Yes Shooter reloaded many times, and used multiple weapons. Mental health check would have prevented weapons acquisition.
Salt Lake City, UT – Trolley Square 5 4 5 4 Yes Shooter did not use high capacity weapons
Nickel Mines, PA – Amish School 5 5 2 2 Yes Once shooter started firing, sheriffs approached – he killed himself as they arrived, and likely would not have had a chance to reload.
Seattle, WA – Capitol Hill 6 2 6 2 Yes Shooter had a weapons-related felony charge, which was reduced to a misdemeanor.
Goleta, CA – postal shooting 6 0 6 0 Yes Shooter had a previous history of mental illness
Red Lake, MN – high school 9 5 3 2 Yes Shooter possessed a gun in his bedroom despite being treated with Prozac. Since he was an adolescent, and his parents/guardians chose to give him a gun, background checks would be ineffective. Shooter shot his grandfather who was a police officer, and took his weapons.
Brookfield, WIChurch group 7 4 2 1 Yes Shooter suffered depression, but had no mental health or criminal records.
Columbus, OH – concert 4 7 0 0 Yes No HCM used, and no medical or criminal record. Nearby police stormed the concert and shot suspect
Meridian, MS – Lockheed Martin 8 7 4 3 Yes Shooter used military-style weapon with high-capacity
Melrose Park, IL – Navistar 4 4 4 4 Yes Shooter used military-style weapon with high-capacity, and was also a convicted felon
Wakefield, MA 7 0 5 0 Yes Shooter used high-capacity weapon and also had a history of mental illness, but with the mental illness far in his past and no criminal record, even stringent checks might not have denied him weapons. Shooter stopped firing at an arbitrary point and sat calmly til arrested. If he had lower capacity weapons, stopping to reload multiple times might have caused him to sit and wait for arrest earlier.
Tampa, FL – hotel 5 3 5 3 Yes Shooter was arrested for assault only a few months earlier, and bought weapon at a gun dealer
Honululu, HI – Xerox 7 0 3 0 Yes Shooter acquired a large number of weapons long before mental issues began.
Fort Worth, TX – Wedgwood Baptist Church 7 7 2 2 Yes Shooter committed suicide after emptying three magazines – but he had six more loaded. Has the magazines been 1/3 smaller, that would have lowered the toll proportionally.
Atlanta, GA – Day trading 9 13 0 0 Yes The shootings happened in multiple separate incidents, making it less likely that HCM limits would have had an impact. Barton was suspected but never charged in earlier murders, so background checks would have had no impact.
Littleton, CO – Columbine High 13 21 6 10 No Shooters used a high capacity Tec-9 and standard capacity 9mm, so avg capacity is used here. Details of the shooting indicate that in many cases shooters fired at the same victim multiple times – if limited in capacity, this would have reduced their ability to fire on additional victims.
Springfield, OR – Thurston High 2 24 1 19 Yes Shooter was tackled and stopped when he first tried to reload – a clear indication that lower capacity would have further limited casualties.
Jonesboro, AR – Westside Middle School 5 10 2 3 Yes Shooters ran away after firing 30 rounds – lower capacity might have reduced total rounds fired.
Newington, CT – Lottery worker 4 0 0 0 Yes Shooter chose specific victims and fired relatively few rounds, so capacity limits make no difference here.
Orange, CA – Caltrans 4 2 3 1 Yes Shooter entered shootout with police shortly after initial incident, lower capacity might have shortened his attack
Aiken, SC – RE Phelon Co 4 3 0 0 No Standard capacity weapon (illegally acquired) used
Fort Lauderdale, FL – city employee 5 1 0 0 Yes Standard capacity weapon used
Corpus Christi, TX – Walter Rossler Co 5 0 0 0 Yes Standard capacity weapon used
Fairchild AFB, WA – hospital 5 22 5 22 Yes Shooter possessed only one 75 round drum magazine – so he would never have to reload. Military police arrived quickly and killed perpetrator.
Aurora, CO – Chuck E Cheese 5 0 0 0 No Shooter fired less than 10 times, executing each victim, usually with a single shot
Garden City, NY – LIRR 6 19 2 6 Yes Shooter emptied two 15 round magazines and was tackled while reloading with a third magazine. Total rounds fired would have been decreased by 1/3 were magazine capacity limits in place.
Fayetteville, NC – Luigi’s Restaurant 4 6 2 3 Yes Shooter used a high capacity rifle, shooting was stopped by nearby police
San Francisco, CA – 101 California St office building 8 6 4 3 Yes Shooter used a 32 round Tec-9 in the shooting, and fired hundreds of rounds
Watkins Glen, NY – office 4 0 0 0 Yes Shooter killed four intentional targets with relatively few shots, and then waited for police to arrive – perhaps less than 10 shots total fired.
Olivehurst, CA – Lindhurst High School 4 10 0 0 Yes Shooter used two weapons and fired relatively few shots, so high capacity weapon limits would have no effect here. Shooter also had no prior criminal or mental history.
Royal Oak, MI – postal 4 6 4 6 Yes Shooter had his concealed weapons permit revoked on concern of mental illness. Shooter also used high-capacity magazines with his rifle and fired scores of rounds according to police.
Iowa City, IA – Univ of Iowa 5 1 0 0 Yes Did not use a high-capacity weapon, and did not display sufficient signs of mental illness prior to shooting to warrant attention
Killeen, TX – Luby’s Cafeteria 20 24 8 10 Yes Used high capacity pistols and reloaded multiple times – capacity limits would have enabled more victims to escape, as many escaped by exiting the restaurant.
Jacksonville, FL – GMAC plant 9 4 9 4 Yes Shooter had a history of violence and convictions, and yet legally purchased multiple weapons. Used a high capacity weapon in shooting
Louisville, KY – Standard Gravure Co 8 12 8 12 Yes Shooter used high capacity weapon, emptying its magazine and committing suicide with his second weapon. Shooter also had a lengthy psychiatric history including hospitalization
Stockton, CA – schoolyard 5 29 5 29 Yes Shooter had a lengthy arrest history and had served time in jail as an accomplice to armed robbery, and yet was allowed to buy weapons.
Sunnyvale, CA – ESL Co shooting 7 4 7 4 Yes Shooter was able to purchase guns while under a court restraining order
Palm Bay, FL – shopping center 6 14 6 14 Yes Shooter used a high capacity .223 caliber rifle, and killed two police officers during the shooting – one of them as the officer was trying to reload. Perhaps if the shooter’s capacity were lower, the officer might have himself fared better. Gunman also had prior assault conviction.
Edmond, OK – USPS 14 6 0 0 Yes Shooter was in National Guard and would have had access to weapons. Though he was referred to as “Crazy Pat”, he had no history of crime or treated mental illness
San Ysidro, CA – McDonalds 21 19 14 13 Yes Shooter used a high capacity weapon, Uzi, pinning down a quick-responding officer with 30 rounds of fire before re-entering restaurant
Dallas, TX – nightclub 6 1 0 0 Yes Shooter used an unknown handgun, emptying it into crowd and then rushing out – unclear that capacity limit would have any impact here.
Miami, FL – welding shop 8 3 8 3 Yes Shooter did not use a high capacity weapon, but purchased his weapons one day after failing a psychiatric exam ordered by his employer, the school district, and after incidents in which he appeared to be a threat to students
Birchwood, WI – hunting altercation 6 2 3 1 Yes Shooter fired 20 rounds at other hunters – if he had a lower capacity, it’s likely that another hunter would have been able to respond with fire

The analysis above attempts to answer the question – what would have happened in these incidents had the proposed laws been in place? Of 459 deaths and 481 injuries in 63 shootings, I estimate that 250 deaths and 324 injuries (54% of deaths and 67% of injuries) might have been prevented with the analyzed proposals. Each proposal, its method of action, and the analysis approach is described further below.

High-Capacity Magazine Ban:

Definition: Sales of high-capacity magazines to and between private citizens would be completely banned, and imports of high-capacity magazines for private use would be banned as well. While many magazines would exist in private hands, a magazine buyback could then be used effectively, as magazines are relatively inexpensive.

Method of Action:

  1. In some instances, the shooter was disarmed by potential victims while trying to reload – smaller magazine size clearly would have limited total impact in these shootings.
  2. In some instances, potential victims fled during breaks in the shooting enabled by reloading – if a shooter has to reload 2 or 3 times as often, this effect is multiplied.
  3. In some instances, law enforcement arrived relatively quickly, and most damage in the shooting was done via the initial magazine – a smaller magazine would have limited impact in the shooting in these instances.
  4. In a few instances, victims attempted to rush the shooter immediately. If a shooter could only fire 10 shots instead of 20-50, it’s possible that he might be tackled quickly rather than be able to continue shooting.
  5. In most instances, the shooter committed suicide after doing a certain amount of shooting, but always before exhausting ammunition. Since each reloading represents a break in the act, some shooters would commit suicide after having fired fewer total rounds if they were capacity constrained.
  6. In a few instances, the shooter appeared to choose a specific weapon because of its high capacity. If high capacity magazines were not available, would the shooter still go forward with the attack?
  7. In 18 of 63 shootings, shooters fired relatively few rounds, chose a small number of specific victims, or used standard capacity weapons. In these instances the high-capacity magazine ban has no impact. 29% of actual mass shootings fell into this category.

Analysis Method: If the shooting fell into the last category above, then zero impact is noted in the analysis. Otherwise, the casualty count is reduced by the ratio of the shooter’s magazine size to standard magazine size – if the shooter used a 30 round magazine, then the casualty count is estimated at 2/3ds lower (rounded up) with a standard capacity magazine. This approach will tend to underestimate the effect of a ban in instances like 1,4, and 6 above, while providing an accurate estimate or an overestimate in instances like 2, 3, and 5 above. In aggregate, I think this approach is unbiased.

Stringent Background Checks:

Definition: Create a mandatory national database of all felons, mentally ill, and others posing threats (anti-terror lists, those who have made threats against schools or other institutions). Mandate that all firearms transactions for new and used weapons, in public and private transactions, be checked against this database, with instant results. This stands in contrast to the current background check system, which is done on paper and via telephone call, not electronically.

Method of Action:

  1. Out of 63 mass shootings over the past 30 years, only 5 have involved illegally purchased weapons. Some of the shooters had a history of mental illness or a criminal record – preventing a sale of firearms to these individuals would reduce the frequency of shootings.
  2. Many of the shooters with a history of mental illness had no criminal record – it’s unlikely that they would know how to obtain an illegal firearm.
  3. Some of the shooters purchased weapons in the days after making threats against a school or other institution – in these cases, a properly implemented stringent background check system would have prevented the weapon sales.

Analysis Method: Shootings were identified in which a shooter had a documented history of mental illness, a criminal record, or had made threats against an institution prior to buying a weapon. In these cases (17 instances total) it’s assumed that the casualty count is reduced to 0, as the shooter would have been unable to obtain a weapon. In reality a certain number of shooters would then try to acquire weapons illegally, and some might succeed. But a certain number of mentally-ill or former felons might never try to obtain a weapon if they knew they had no easy or legal means to do so, providing an offset.

Analysis of Assault Weapons Ban and Armed Civilian Presence

Two other proposals have been mentioned in the last several months – a ban on assault weapons and the placement of more armed guards or civilians in public places. On the question of assault weapons, the data from mass shootings shows that shooters preferred a range of semi-automatic weapons with high-capacity magazines. Weapon capacity makes a difference, but the type of weapon (handgun vs rifle) does not.

With regard to armed bystanders, in 9 of 63 shootings armed individuals (often police officers) were present. In several cases armed individuals became victims in the shooting, and the presence of armed individuals did not prevent the shooting from taking place. However, this analysis is by definition incomplete – this is an analysis of shootings that actually did take place, and doesn’t include data on shootings that were stopped by armed individuals. The evidence here suggests that the element of surprise may render concealed weapons somewhat ineffective, but this is not a conclusive finding.