Monday, October 1, 2012

10-1-12 - Health Care Reform News from Senate JEC

Liability and Health Reform Update:
Health Care Reform News from the US Senate JEC
October 1, 2012
Editor, Donna Baver Rovito
This periodic compilation of news and information about health care reform relies on numerous sources for the stories health care professionals and concerned citizens need to be well informed.
Periodic opinions or political comments are the editor's and the editor's alone and appear in blue italics. This eNewsletter is not affiliated with or financially supported by any advocacy organization or political candidate or group.


These short daily (and sometimes more than once-a-day) blurbs about health care reform are written and researched by Chris Jacobs, a senior policy analyst for the Joint Economic Committee of the Senate Republican staff. So, yes, they're somewhat partisan.

But they're also meticulously researched and backed up with links, facts, and figures. He often comments on the news of the day - and spent several entries on the President's speech to AARP.

I've saved the last two weeks' worth and have compiled them into this newsletter, with the most recent entries first. If you'd like to be added to his list, all you need to do is email him and ask:

If you read these few paragraphs a day, you'll be well informed about the ongoing health care reform debate - especially all the reasons that the new health care law needs to be repealed.

Speaking of repealing the PPACA - here's an urgent request for doctors and other health care professionals:

I need QUOTES from you about why you support repealing "ObamaCare," and why you support candidates who promise to repeal it. If you support Mitt Romney for president BECAUSE you want PPACA repealed, please state that as well, and send your quotes to me via email, including your name, specialty, and where you practice. The quotes will be used on websites, social media, etc.

Thank you!

Donna Baver Rovito
Editor, Liability and Health Reform Update

((OK, here are the short reports from Chris Jacobs, most recent first......))

10-1-12 - "Invisible Obama" Breaks the Law -- And His Promise to Seniors...

Throughout the last few months, President Obama has claimed that his Medicare plan will help improve the program. He claimed in August that “I’ve strengthened Medicare….I’ve proposed reforms that will save Medicare money by getting rid of wasteful spending in the health care system.” In his deficit speech last April, the President outlined those reforms:

We will slow the growth of Medicare costs by strengthening an independent commission of doctors, nurses, medical experts and consumer who will look at all the evidence and recommend the best ways to reduce unnecessary spending while protecting access to the services that seniors need.

The President of course was referring to the Independent Payment Advisory Board, a panel of bureaucrats created in Obamacare to enforce binding caps on Medicare spending – caps which the President’s 2011 deficit submission proposed lowering even further.

There’s only one problem with the President’s claims that he “strengthened Medicare” by creating the IPAB: President Obama has now violated the law by failing to appoint nominees to a board he created. According to page 426 of the statute, the law appropriates funds for IPAB (originally $15 million, but lowered to $5 million last December) “for fiscal year 2012” – that’s the fiscal year that ended on September 30, i.e., yesterday.

So Obamacare contemplates IPAB being up and running NOW – yet President Obama has failed to nominate any appointees to the board. If the President wants to save Medicare so badly – and IPAB is so critical to saving Medicare – what’s he waiting for? Why is he breaking his promise to seniors? And if IPAB is so innocuous and won’t harm seniors, why is he waiting until AFTER his re-election campaign to announce who he wants to put on the board – is it because the Administration plans on naming more radical appointees like Donald “Rationing with Our Eyes Open” Berwick to administer the IPAB’s new world order?

Clint Eastwood’s “empty chair” speech at the Republican National Convention generated much discussion as to its broader context. When it comes to health policy, however, that empty chair takes on a clear meaning – the vacancies on the IPAB board, caused by a President who would rather abdicate his statutory duties than reveal the controversial plans he intends to implement after the election.

10-1-12 - There He Goes Again: Biden Creates Another "Bidenism"

Over the weekend, Joe Biden did what Joe Biden does best – tied his tongue in knots – this time, over claims that Obamacare will actually lower costs for American families. Politico quoted the Vice President as telling one visitor at a deli that Obamacare “will help you dramatically,” because individuals will “be able to get better health care than you had before at a lower cost.” The only problem is that no one believes the claim is true – not fact-checkers, and not the families that have seen premiums go up by over $3,000 since Barack Obama was first elected.

President Obama also keeps trying to peddle the false claim that Obamacare will lower insurance premiums. Writing in the New England Journal of Medicine last week, the President claimed that “economists believe family premiums will be about $2,000 less” in 2019 under the law. (Assuming of course that businesses are even offering health insurance at all by that point.) The op-ed (conveniently) doesn’t cite a source on this claim, but the Administration has previously invoked a report published by the Business Roundtable in November 2009 (i.e., before Obamacare was even enacted) to make this assertion. However, the Roundtable’s study only presumes a reduction in the increase of premiums. Don’t take my word for it: Look at Exhibit 1 of the study (depicted below), which study illustrates that under the maximum achievable “savings,” large employer premiums in 2019 will be $23,151 per family – or $12,408 higher than they were in 2009.

The President repeatedly promised during his campaign that he would “cut” premiums – meaning they would go DOWN, not merely just “go up by less than projected.” And the skyrocketing premiums Americans are paying for health insurance are a constant reminder of how Obamacare falls short. Democrats have no answer to the obvious question: How is a $12,400 increase in premiums – as opposed to the $2,500 reduction that candidate Obama repeatedly promised – a change that struggling middle-class families can believe in? Because, as Joe Biden himself might say, middle-class families paying thousands more in premiums because Obamacare failed to deliver is a really big deal indeed.

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9-26-12 - The Truth about Obamacare Keeps Coming Forward

From the Manchester Union Leader last week came word of an interesting development. In a debate, former Congresswoman Carol Shea-Porter, who looks to regain her seat this fall, admitted that Obamacare – which she voted for two years ago – WON’T reduce health costs:

Shea-Porter said the Obama health care plan will slow the increase in health care costs, but no one should expect them to drop. “Everyone knows that costs go up. For him [Rep. Frank Guinta] to say health care costs should drop when nothing else ever drops, it's just not accurate,” Shea-Porter said.

But Guinta said Congress should try to reduce health care costs. “I've yet to hear anyone say ‘Thank goodness for the Affordable Care Act because it slowed my (premium) increase,’” he said.

And the reason Rep. Guinta has yet to hear anyone say Obamacare has cut their premium increases is because the law hasn’t fulfilled its promise. Even fact-checkers have admitted this reality, when Politifact last month officially declared candidate Obama’s promise to “cut the cost of a typical family’s health insurance premium by $2,500 a year” a broken promise:

No cut in premiums for typical family

Back in 2008, we collected over 50 promises Barack Obama made about health care….When it came to health care premiums for the typical family, Obama said he would cut the annual cost by $2,500. Months before Obama took office, a New York Times reporter dubbed it one of the most audacious pledges of the campaign.

We reached out to David Cutler, an economist who advised Obama during the 2008 campaign and helped calculate the $2,500 figure that appeared in Obama's speeches. He said the calculation encompassed total health care costs, not just premiums. These would include out-of-pocket costs, employer-provided insurance costs, and taxes to pay for public insurance programs.

Cutler acknowledged that Obama made “occasional misstatements” that tied the $2,500 reduction to premiums and not total medical spending. We can't judge whether Obama misspoke, but we checked the Project Vote Smart database of public statements by politicians, which shows that Obama said premiums (and only premiums) would go down for the typical or average family by $2,500 repeatedly. You can see examples throughout the arc of his 2008 presidential campaign
here, here, here, and here.

It is also true that Obama used the number in a more expansive context sometimes, such as
here during a speech in Newport News, Va, and here in a response to a report about Medicare and Social Security.

2008 New York Times article explains how Cutler and his colleagues calculated the $2,500 figure, a round number based on back-of-the-envelope arithmetic.

“That number is much simpler than the world of insurance actually is,” said Deborah Chollet, a health economist for Mathematica Policy Research, a nonpartisan policy analysis group….

In our search for evidence that the law might reduce the typical family's premiums, we contacted the Department of Health and Human Services, the federal agency implementing the law. The department could not provide proof that the average family would see a reduction, much less a $2,500 reduction.

In assessing this promise, we consider the following: An author of the $2,500 figure has disavowed its use as it relates to premiums alone. An independent health care analyst projects that premiums will go up for the typical family. The federal agency implementing the Affordable Care Act did not provide evidence that premiums will go down for the typical family. We rate this a Promise Broken.
The fact that Democrats – and even President Obama’s own Administration – acknowledge that the law won’t meet the President’s stated promise is yet another way that the promise of “hope and change” has evaporated for families struggling to pay their insurance bills.

9-25-12 - Obama Administration, Asleep at the Switch...

Yesterday various press outlets reported that the Administration warned hospitals and other medical providers about questionable Medicare billing tactics that could range from abusive to fraudulent. But that’s not the real story – the real story is how the Administration was asleep at the switch for years, allowing these abusive practices to continue, even accelerate. A study by the Center for Public Integrity published in the Washington Post more than a week ago, and highlighted in this space, noted that “thousands of doctors and other medical professionals have billed Medicare for increasingly complicated and costly treatments over the past decade, adding $11 billion or more to their fees – and signaling a possible rise in medical billing abuse.”

So what did the Administration do when this major Washington Post expose appeared, questioning $11 billion in Medicare spending as questionable, abusive, or even downright fraudulent? Exactly nothing. Only when a second, similar story appeared in the New York Times this weekend did Secretary Sebelius finally send a letter questioning provider billing practices, and promising vigilance on this issue – with “vigilance” hopefully meaning something, after her Department’s years of neglect.

The Administration has asked questions of Medicare providers about their billing practices, but the real questions belong to the Administration:

1. Why did the Administration wait so long to take action – and how many billions of dollars in questionable transactions were completed because this Administration decided not to examine billing practices for potential abuse and fraud?

2. How can the Administration implement the 2700 pages of Obamacare if they can’t even ensure that existing laws and practices within Medicare are being followed? Conversely, was the Administration asleep at the switch when it comes to questionable billing practices because HHS is spending all its time, personnel, and resources implementing Obamacare, rather than watching over Medicare?

3. How can President Obama and Secretary Sebelius claim Obamacare helps crack down on fraud, when they allowed $11 billion in questionable transactions to go unchallenged? Given this record, perhaps the Administration would be better off outsourcing oversight of Medicare to the Center for Public Integrity and the New York Times.

One final note: Three liberal advocates, including former OMB advisor Zeke Emanuel and former CMS Administrator Donald Berwick, penned an op-ed in this morning’s Wall Street Journal denouncing comprehensive Medicare reform, and claiming that government-run Medicare can do a better job containing costs because “the key to sustainable cost control lies in encouraging physicians and hospitals to focus on quality rather than quantity, and value rather than volume.” These claims would have somewhat more credibility if they weren’t co-authored by someone who, in nearly two years at CMS, allowed transactions potentially bilking Medicare for billions to pass through undetected right under his nose. Given that track record, Dr. Berwick is in absolutely no position to give lessons on how to “save” Medicare. Instead the old proverb rings true: Physician, heal thyself.

9-25-12 - Obamacare's Taxes Hitting the Middle Class

Even as President Obama claims he doesn’t want tax increases to hit struggling middle class families, evidence has piled up in recent weeks about the effects Obamacare’s massive “temporary refund adjustments” have had on the economy. Earlier this month medical device manufacturer Welch Allyn announced it was laying off ten percent of its workforce – amounting to several hundred jobs – due to the “new onerous U.S. Medical Device Tax scheduled to begin in 2013 as mandated in” Obamacare. To these workers, the idea that Obamacare’s tax increases will not affect the middle class is a broken promise.

Separately, many federal workers received a version of the e-mail below, noting that Flexible Spending Account limits will decline in 2013 from $5,000 to $2,500, thanks also to Obamacare. (It’s also interesting that, unlike the rebate checks issued under the law, the e-mail contains absolutely zero references to “the Affordable Care Act” or “Obamacare” in explaining the reason for this tax increase. Coincidence? I think not.) Candidate Obama promised families their costs would decline by $2,500 – but instead, middle class families will lose $2,500 in tax-free savings. It’s yet another example among many about how President Obama has broken his promises – and those broken promises are breaking the back of the middle class.

9-25-12 - Is Obamacare Accelerating Health Cost Growth?
The Health Care Cost Institute yesterday released its annual report on the rate of health expenditure inflation, and the news was not good – not only are costs rising, they are rising at a faster rate than in prior years. As the Washington Post reports:
Spending for private health insurance surged by 4.6 percent in 2011…That growth rate is faster than the rest of the economy and higher than the previous year, which had 3.8 percent growth. Average spending on a private insurance patient rose to $4,547 in 2011, compared with $4,349 in 2010. That statistic suggests that a recent downturn in health-care spending may have been a temporary product of the recession rather than a more permanent change, as some health-care economists have hoped.
As a reminder, candidate Obama said repeatedly his health plan would CUT premiums by an average of $2,500 per family – meaning premiums would go DOWN, not merely just “go up by less than projected.” The campaign also promised that that those reductions would occur within Obama's first term. But as the below graph shows, while candidate Obama promised premiums would fall by $2,500 on average, premiums have risen by $3,065 since Barack Obama was elected President.

Regardless of whether or not Obamacare was the cause of the acceleration in health costs in 2011, the news once again illustrates how the 2700-page law has failed to live up to Barack Obama’s promise to lower costs for struggling American families.

9-24-12 - David Axelrod, Pots, and Kettles
Obama campaign adviser David Axelrod appeared on MSNBC’s Morning Joe this morning, and repeated the old tropes that Obamacare “plowed [money] back into Medicare,” and that “Medicare’s length of life has been extended” due to Obamacare. We’ve previously fact-checked all of these statements here. But what caught us as interesting was this comment:

There’s an awful lot of demagoguery out there. And in that environment, it’s very hard to have a serious discussion about issues like that.

It is entirely true that there is an awful lot of demagoguery about Medicare and entitlements out there. The problem for Mr. Axelrod is that most of it comes from Democrats:

· As one House Member put it, if the President had proposed a true restructuring of our unsustainable entitlements, that would “cancel out any bludgeoning that Democrats might give the Republicans over Medicare and Medicaid.”

· The Washington Post’s liberal Plum Line reported last year that Senate Democrats don’t want to pass Medicare reform because it would be “giving away the biggest [political] advantage” Democrats have had “in some time.”

· Last November, Rep. Steve Israel, Chair of the Democratic Congressional Campaign Committee, in an interview with the Postdeclined to say whether a [deficit] agreement to cut entitlements might have hindered his political strategy.” In other words, Democrats WANTED the supercommittee to fail – so that they could resume their “Mediscare” political attack ads against Republicans.

If Mr. Axelrod wants to criticize the members of his own party for using Medicare as a political cudgel, we’re all ears. But unless and until that happens, if the Obama campaign wants to complain about Medicare demagoguery, they might be wise to first look in the mirror.
9-21-12 - Fact Check: Access to Physician Services
In reviewing the transcript of the President’s speech before AARP, there was one dubious statement we overlooked, and it’s this: “A new study says that under their [premium support] plan, if just 5 percent of seniors switch to private plans, 40 percent of doctors who currently take Medicare would stop accepting it. So think about that. Millions of seniors would be forced to change doctors.” As one might expect, there are several problems with this statement:

· First, it wasn’t a “study” in any sense of the term – and it certainly wasn’t independent. The President was referring to a back-of-the-envelope calculation by his former budget director in a Bloomberg column this week. One might argue that the author of the study, Peter Orszag, might be slightly biased towards the President this November, seeing as how he used to work for him.

· Second, Obama himself mis-characterized the Orszag column. Here’s what Orszag actually wrote: “About 10 percent of the U.S. population is now enrolled in traditional Medicare, and an additional 5 percent has private Medicare plans. Let’s assume, for the sake of argument, that the Ryan plan would cause another 5 percent of the population to shift…” Orszag based his conclusions on 5 percentage of the entire American public switching away from Medicare, whereas the President said Orszag’s conclusions were based on 5 percent of seniors switching away from Medicare – a much lower bar. So the President over-stated the impact of Orszag’s “study” and its effects on physician access.

· Most importantly, Orszag’s conclusions – which were over-estimated by the President – aren’t borne out by recent evidence. Medicare Advantage enrollment HAS gone up by leaps and bounds in recent years – since 2003, it has more than doubled in both absolute terms and as a percentage of Medicare beneficiaries. In other words, seniors have switched plans, as the chart below shows. Yet the Medicare Payment Advisory Commission said this year that “overall, beneficiary access to [Medicare physician] fee schedule services is good.” If Orszag believes that beneficiaries switching to private plans would cause doctors to stop seeing Medicare patients, then why did a 100 percent increase in Medicare Advantage enrollment not have a significant effect on access to physician services in traditional Medicare?

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Peter Orszag has made ludicrous claims before. He previously said that Obamacare’s CLASS act would be “on a firm financial footing of its own,” only to watch as the program collapsed even before it began. Given the evidence above, his claims about physician access appear as logical as his claims about the CLASS Act, and should be taken just as seriously.
9-21-12 - Fact Check: "At the Mercy of Seniors"
The Hill reports that, during his remarks to AARP this morning, the President attacked Republicans for leaving seniors “at the mercy of insurance companies.” Well, in case you missed it, here are five ways the President and his Administration have left seniors at the mercy of one organization with insurance interests – AARP – by granting them special exemptions and ignoring their questionable insurance practices:

1. AARP’s lucrative Medigap insurance was exempted in Obamacare from the ban on pre-existing conditions; medical loss ratio requirements; caps on insurance industry executive compensation; and the tax on all other health insurance plans.
2. The Department of Health and Human Services didn’t think all these Obamacare exemptions were enough; last year they also exempted Medigap insurance from premium rate review – even though AARP, which carries the plan with the largest market share, earns greater profits the more seniors pay in premiums.
3. At a conference hosted by America’s Health Insurance Plans in March 2010, HHS Secretary Sebelius encouraged the insurance industry to give up some of its profits, at a time when health insurance profit margins were about 2 percent. Yet neither Secretary Sebelius nor anyone else in the Administration ever criticized AARP for making a profit margin of nearly 5 percent on its Medigap insurance.
4. In April 2010, the Administration engaged in very public efforts to “encourage” insurance companies to ban rescissions and extend coverage to young adults earlier than is required by the law. But no one from the Administration has taken similar steps to encourage AARP to stop discriminating against sick seniors applying for Medigap coverage.
5. In a speech at an AARP conference in October 2010, Secretary Sebelius praised AARP as the “gold standard in cutting through spin and complexity to give people the accurate information they need.” Yet the National Association of Insurance Commissioners (NAIC) has previously expressed concern about the potential for conflicts-of-interest associated with percentage-based compensation arrangements. So Secretary Sebelius praised as the “gold standard” for “accurate information” an organization that has the types of financial conflicts her insurance commissioner colleagues have criticized as ripe for abuse.

If the President is so worried about leaving seniors at the mercy of insurance companies, perhaps he should tell the people within his own Administration to stop granting political favors to Democrats’ cronies at the AARP.
9-21-12 - Fact Check: Paying in to Entitlements
The President just told the AARP that seniors pay in to Social Security and Medicare. The problem is, that claim is half true. While individuals obviously do pay in to the Social Security and Medicare programs, most beneficiaries receive more in benefits than they paid in in taxes. An Urban Institute study about the entitlement benefits and taxes recipients will receive (and pay) over their lifetimes found that a senior with average wages retiring this year will have paid $58,000 in Medicare taxes – but will receive over $167,000 in Medicare benefits. The Associated Press ran a story on this issue in December 2010, and its headline was clear: “What You Pay for Medicare Won’t Cover Your Costs.”

Our nation’s entitlement programs are in dire need of reform, to become more sustainable. Perpetuating myths about their long-term viability, which the President’s comments imply by saying individuals fully-fund their benefits when paying into the system, only makes generating the political consensus necessary for true entitlement reform more difficult.
9-21-12 - Fact Check on Medicare and Obamacare
The President just told the AARP that the claim that Obamacare took $716 billion from Medicare was “not true.” The problem is that the facts say otherwise:

· Last November, Nancy Pelosi admitted that Democrats “took a half a trillion dollars out of Medicare in [Obamacare], the health care bill” to pay for more federal spending.
· The Congressional Budget Office agrees; that’s why the CBO said that the Medicare reductions in Obamacare “will not enhance the ability of the government to pay for future Medicare benefits” – because those savings will be used to fund other unsustainable entitlements. If Democrats want to use the Medicare savings provisions to extend the life of the Medicare trust fund – and not to fund the new entitlements created by the law – the Congressional Budget Office previously estimated what the fiscal impact would be: “A net increase in federal deficits of $260 billion” through 2019.
· The non-partisan Medicare actuary also previously confirmed that the Medicare reductions in Obamacare “cannot be simultaneously used to finance other federal outlays and to extend the [Medicare] trust fund” solvency date – rendering dubious any potential claims that Obamacare will extend Medicare’s solvency.

President Obama himself admitted the problems with Obamacare’s supposed logic in a 2010 interview, when he stated that “You can’t say that you are saving on Medicare and then spending the money twice.” Yet that’s EXACTLY what the law did – and no amount of spin can change that fact.
9-21-12 - The Obama Administration's Protection Racket
Shortly, President Obama will be addressing the AARP convention via satellite. He will undoubtedly say nice things about AARP’s role as a “senior advocate.”
But what he won’t discuss are the ways in which his own Administration has allowed AARP to continue making billions in profits on its insurance business:
1. AARP’s lucrative Medigap insurance was exempted in Obamacare from the ban on pre-existing conditions; medical loss ratio requirements; caps on insurance industry executive compensation; and the tax on all other health insurance plans.
2. The Department of Health and Human Services didn’t think all these Obamacare exemptions were enough; last year they also exempted Medigap insurance from premium rate review – even though AARP, which carries the plan with the largest market share, earns greater profits the more seniors pay in premiums.
3. At a conference hosted by America’s Health Insurance Plans in March 2010, HHS Secretary Sebelius encouraged the insurance industry to give up some of its profits, at a time when health insurance profit margins were about 2 percent. Yet neither Secretary Sebelius nor anyone else in the Administration ever criticized AARP for making a profit margin of nearly 5 percent on its Medigap insurance
4. In April 2010, the Administration engaged in very public efforts to “encourage” insurance companies to ban rescissions and extend coverage to young adults earlier than is required by the law. But no one from the Administration has taken similar steps to encourage AARP to stop discriminating against sick seniors applying for Medigap coverage
5. In a speech at an AARP conference in October 2010, Secretary Sebelius praised AARP as the “gold standard in cutting through spin and complexity to give people the accurate information they need.” Yet the National Association of Insurance Commissioners (NAIC) has previously expressed concern about the potential for conflicts-of-interest associated with percentage-based compensation arrangements. So Secretary Sebelius praised as the “gold standard” for “accurate information” an organization that has the types of financial conflicts her insurance commissioner colleagues have criticized as ripe for abuse
Why might the Administration look the other way despite these abuses? Documents released by the Energy and Commerce Committee yesterday provide myriad reasons, showing all the political favors senior Administration officials asked of AARP as they rammed Obamacare through Congress:

· Jim Messina, White House Deputy Chief of Staff: “We need [AARP CEO] Barry Rand to go meet with Ben Nelson personally and just lay it on the line. ‘We will be with you, we will protect you. But if you kill this bill, seniors will not forget.’ We are at 59 [votes in the Senate], we have to have him.” (page 7)
· Jim Messina: “Can we get immediate robo calls into Nebraska urging [Ben] Nelson to vote for cloture?” (page 9)
· Nancy-Ann DeParle, Director, White House Office of Health Reform: “Can AARP support accountable care orgs [sic] and some other delivery system reforms?” (page 26)
· Jim Messina: “Latest top 25 targets list from House leadership” (page 35)
· Ann Widger, Office of Public Engagement: “We would really like AARP to participate in this roundtable.” (page 37)
· Ann Widger: “Did you guys put out any paper today on the McCain [Medicare] amendment?” (page 39)
· Jim Messina: “[Rep. Larry] Kissel a problem…Help.” (pages 42-43)
· Nancy-Ann DeParle: “Can you get me a copy of the [AARP] bulletin we discussed yesterday?” (page 64)

Secretary Sebelius has already admitted she has acted improperly in using her office to conduct political activities; the Office of Special Counsel last week concluded she violated the law to do so. Given all of the above, it is not unreasonable to question whether the Secretary, and others within the Administration, made a calculated political decision to grant special favors to AARP – and ignore its questionable business practices – because AARP endorsed Obamacare.

Yesterday President Obama claimed that he changed Washington “from the outside” by enacting Obamacare. The pattern of conduct described above suggests just the opposite: That the President rammed Obamacare through only by establishing what amounts to an inside-the-Beltway protection racket between the Administration and AARP – the former will allow the latter to continue overcharging seniors for insurance, so long as AARP uses its advocacy megaphone to endorse the President’s liberal causes
9-21-12 - Sen. DeMint Op-Ed :AARP Sells Out Seniors for Obamacare
Pasted below my signature is an op-ed by Sen. DeMint in Politico, highlighting the ways in which AARP takes advantage of seniors to generate billions of dollars in profits from its insurance business. It also discusses all the ways in which this Administration has willfully turned a blind eye toward AARP’s unsavory insurance practices – because AARP has given its full-throated support for Obamacare and other elements of the President’s liberal agenda.
AARP sells out seniors for 'Obamacare'
Sen. Jim DeMint
September 21, 2012 12:27 AM EDT
President Barack Obama is scheduled to speak Friday via satellite to a convention sponsored by AARP. His speech will likely extol the virtues of “Obamacare,” and engage in scare tactics about conservative proposals to make Medicare sustainable. But here are five facts you’re unlikely to hear from the president, or AARP, about how each treats seniors:
First, while AARP poses as a disinterested senior advocate, it functions as an insurance conglomerate, with a liberal lobbying arm on the side. AARP depends on profits, royalties and commissions to make up more than 50 percent of its annual revenues. Membership dues from seniors account for only about 20 percent. The sums involved aren’t chump change: AARP’s $458 million in health insurance revenue in 2011 would rank it as the nation’s sixth most profitable health insurer.
Second, AARP wins when seniors lose. Because AARP receives a “royalty fee” of 4.95 percent of every premium dollar paid by seniors buying Medigap insurance from the organization, AARP earns more profit when seniors pay more in premiums. Even former AARP executives admitLINK that the billions of dollars raised from these business enterprises have compromised the organization’s mission and independence.
Third, AARP’s policy positions just happen to coincide with its financial interests. “Obamacare,” which AARP lobbied heavily for, could yield the group windfall profits of more than $1 billion over the next decade by forcing seniors off Medicare Advantage plans and into Medigap supplemental coverage. Conversely, AARP engaged in a secret lobbying campaign to block Medigap reforms last year that by one estimate would have saved nearly 80 percent of seniors an average of $415 per year – but cost AARP billions in profits.
Fourth, AARP knows it can protect its financial interests by aligning with Democrats, no matter what its members think. That’s one reason why AARP endorsed “Obamacare,” though the organization’s call response logs indicate opponents outnumbered supporters by more than 50 to 1.
Consider: One senior AARP executive wrote the White House in November 2009, saying “we will try to keep a little space between us” on health care – because AARP’s “polling shows we are more influential when we are seen as independent, so we want to reinforce that positioning….The larger issue is how best to serve the cause.”
“The cause” in this case is liberalism, the Obama agenda and “Obamacare” in particular.
Fifth, the Obama administration has reciprocated AARP’s support by giving the group preferential treatment. “Obamacare” exempted Medigap insurance – a market AARP dominates – from virtually all its new mandates, including the ban on preexisting condition discrimination. The Department of Health and Human Services exempted Medigap plans from insurance rate review, though AARP, whose plan is the most popular form of Medigap coverage, makes more in profit the higher premiums rise. Though the administration has publicly attacked other insurance companies with much smaller profit margins, it has not openly criticized AARP’s business practices.
It’s not that AARP and the administration don’t know better – they do. The AARP executive who wrote White House officials knew that AARP had to be “seen as independent.” He wasn’t independent, of course – comments about “serv[ing] the cause” make that clear. But he knew he had to appear impartial to AARP’s members.
And as a former state insurance commissioner, Health and Human Services Secretary Kathleen Sebelius must know that percentage-based “royalty” payments create a strong incentive for abuse. Nonetheless, Sebelius called AARP the “gold standard” for “accurate information” – though AARP makes more profits the higher the Medigap premiums rise for seniors.
As much as Obama claims to eschew Chicago-style politics, this administration’s crony relationship with AARP gives every appearance of being an old-fashioned protection racket. The administration lets AARP make billions of dollars in profits off seniors, as long as they continue to support “the cause” and funnel those profits toward supporting Obama’s liberal agenda.
That’s why the administration won’t speak out against AARP’s abuses; why Democrats who said they ended “the worst insurance industry abuses” in “Obamacare” exempted Medigap insurance from virtually the entire law, and why the Obama campaign is so willing to use AARP as a political shield in running negative attack ads against his opponent.
The president recently said, “no American should have to spend their golden years at the mercy of insurance companies.” What he won’t tell seniors today is that, thanks to his administration’s protection racket, that isn’t true.
Millions of seniors have been — and will continue to be — taken advantage of, because this administration’s protection racket turns a blind eye toward the insurance industry abuses of the AARP.
Sen. Jim DeMint (R-S.C.) is serves on the Senate Commerce, Science and Transportation Committee, which has oversight over AARP, as well as the Joint Economic Committee
9-20-12 - Two Math Lessons for President Obama
In his speech to the Democratic National Convention a few weeks ago, President Clinton said that one of the new ideas Democrats brought to Washington was “arithmetic.” Which is particularly ironic, given two developments associated with yesterday’s updated CBO estimates of the mandate taxes associated with Obamacare:

1. The Administration claimed that the tax increase wouldn’t harm middle-class families because the tax “will only affect people who can afford health care but choose not to buy it.” But the Congressional Budget Office estimated that 600,000 people with incomes UNDER the federal poverty level – that’s $15,130 for a family of two in 2012 – would pay higher taxes due to the Obamacare mandate. CBO has also projected that the average premium in the Exchange will be $15,200 per family per year. Last time I checked, $15,200 was greater than $15,130 – meaning some people may face higher taxes because Obamacare forces them to buy health insurance whose total premium could cost more than their family’s entire income.

2. CBO also admitted that “most of the increase—about 85 percent—in the number of people who are expected to pay the penalty tax [since CBO’s April 2010 estimate] stems from changes in CBO and JCT’s baseline projections since April 2010, including the effects of legislation enacted since that time, [and] changes in the economic outlook, primarily a higher unemployment rate and lower wages and salaries.” I could be wrong, but I thought it was better for unemployment to be going down, not up, and for wages to be going up rather than down. In which case a President running for re-election on a slogan of moving “Forward” has in reality moved the American economy backward since CBO made its initial estimates two years ago.
9-20-12 - Profits Before Principles: How AARP Wins When Seniors Lose
Senator DeMint has released a report, entitled “Profits Before Principles,” which examines the business practices of AARP. The report includes new research showing how AARP would lose billions of dollars if Obamacare is repealed or Medigap reforms are passed. AARP secretly lobbied against bipartisan Medigap reform during last year’s debt supercommittee negotiations, which would have lowered costs on seniors but lowered AARP’s profits by $1.8 billion, while hiding that information from their members. The report also explores the group’s ties to the Obama Administration and Democrat Party. It details the numerous mandate exemptions in Obamacare that Medigap insurance received, a market AARP happens to dominate. The Department of Health and Human Services (HHS) has also repeatedly shielded AARP from new health insurance regulations and government oversight.

9-19-12 - "Medicare Quantitative Easing:" Kathleen Sebelius Channels Ben Bernanke
The Administration announced today its projection that Medicare Advantage enrollment will rise next year. What it did NOT mention in its announcement is why the program’s enrollment may climb: Because of a Medicare Advantage demonstration program costing more than $8 billion, and implemented solely by executive fiat, that looks suspiciously like an attempt to avoid the effects of Obamacare’s $300 billion in Medicare Advantage cuts prior to the 2012 election. In other words, even as the Administration implements the cuts with one hand, its demonstration program – which amounts to a three-year Obamacare waiver for seniors – temporarily undoes the cuts with the other, because Secretary Sebelius has decided to spend an additional $8 billion purely on her say-so.

This attempt by the Administration to essentially print money so its Medicare Advantage problem goes away before the 2012 election has not escaped criticism. Both the Medicare Payment Advisory Commission and the Government Accountability Office have raised serious questions about the demonstration program. One report by GAO suggested the program may exceed the Administration’s statutory authority. The Associated Press also reported on the Medicare Advantage demonstration last year, noting that the program “could head off service cuts that would have been a [political] headache for Obama and Democrats in next year’s elections.” Even a former Democrat staffer who worked in the Clinton Administration admitted that the effort amounted to a political stunt: “It’s fair to say that [Medicare] could not tolerate dislocation, given the political climate.”

Some conservatives have criticized Chairman Bernanke’s latest efforts at quantitative easing, noting that the Federal Reserve’s initiatives to print money could prove difficult to unwind in the longer term and lead to inflation. Likewise, Secretary Sebelius’ efforts to print $8 billion to solve a political problem could prove the tip of the iceberg in its long-term fiscal effects. The Administration assumes all the Medicare spending reductions will go into effect, but the Medicare Advantage demonstration program illustrates how the Obama White House has already reversed one of the major spending reductions – the Medicare Advantage cuts – to fend off political dissent during the President’s re-election campaign. So either seniors will lose access to Medicare Advantage plans, the Obama Administration will continue to undo the cuts – thus causing the deficit to increase – or some combination of the two will take place. Either way, Secretary Sebelius’ “political quantitative easing” when it comes to Medicare Advantage is not likely to end well for seniors, or for taxpayers.
9-19-12 - More Silliness from Peter Orszag
Former Obama Administration budget official Peter Orszag uses his weekly column in Bloomberg to make claims that premium support proposals will result in fewer doctors accepting patients in traditional, government-run Medicare. But the article includes several faulty premises, starting with the fact that “Medicare represents such a large share of the health care market.” The word “market” appears frequently in the Orszag article – but the term has very little to do with government-run Medicare. A program like Medicare – which relies upon government-dictated, top-down, “take it or leave it” pricing structures – is NOT a market, under any true sense of the term – it’s tantamount to economic dragooning of medical providers.

If Orszag and others on the Left want to argue that Medicare IS a market, ask them how they would respond if half of all doctors, hospitals, or both suddenly decided to drop out of the Medicare program. Does anyone really believe that liberals would allow such a scenario to happen? Of course they wouldn’t. And given the trillion-dollar budget deficits under President Obama – making new money to finance reimbursement rate increases virtually impossible to find – Democrats would instead propose new forms of coercion to keep doctors from leaving the Medicare program. Orszag may talk about markets all he wants, but it’s patently obvious that no Democrat would ever allow a true marketplace for provider participation to develop within Medicare.

Second, if premium support really does result in some percentage of physicians leaving traditional Medicare, seniors could choose a Medicare Advantage plan to maintain access to their favorite doctors and hospitals as part of that plan’s provider network. Orszag claims that “the existing Medicare program already offers Medicare Advantage plans, so perhaps anyone who wants private insurance already has it. But then, what is the point of Ryan’s Medicare reform?” Well, one point is that premium support would mitigate the effects of Obamacare’s $300 billion in cuts to Medicare Advantage, which will reduce the program’s enrollment by half and plan choices by two-thirds. So seniors would actually have a true choice in health plans under premium support, which would fix the damage Obamacare is about to inflict on the Medicare Advantage program.

That’s not the only part of Obamacare Orszag conveniently left out. His piece ignores entirely the fact that both the Congressional Budget Office (which Orszag himself used to head) and the non-partisan Medicare actuary believe that Obamacare will result in providers becoming unprofitable and leaving the program. Here’s what the actuary had to say:

In the Office of the Actuary’s April 22, 2010 memorandum on the estimated financial effects of the Affordable Care Act, we noted that by 2019 the update reductions would result in negative total facility margins for about 15 percent of hospitals, skilled nursing facilities, and home health agencies. This estimated percentage would continue to increase, reaching roughly 25 percent in 2030 and 40 percent by 2050. In practice, providers could not sustain continuing negative margins and, absent legislative changes, would have to withdraw from providing services to Medicare beneficiaries, merge with other provider groups, or shift substantial portions of Medicare costs to their non-Medicare, non-Medicaid payers.

Unless and until Orszag wants to acknowledge what his former colleagues at CBO and elsewhere have said – that Obamacare itself will reduce access to Medicare providers by as much as 40 percent over the long term – he has little right to cast stones elsewhere. We should take no lessons from someone who, given his VERY selective memory, appears more interested in scoring cheap political points for his former boss than in having a substantive policy discussion.
9-17-12 - Coming Attractions: Obamacare Goes Hollywood!
Over the weekend, the New York Times reported on California’s attempts to implement Obamacare. Among other things, the state is looking to build support for the law by hiring a PR firm to engage in some old-fashioned Hollywood propaganda:
Realizing that much of the battle will be in the public relations realm, the exchange has poured significant resources into a detailed marketing plan — developed not by state health bureaucrats but by the global marketing powerhouse Ogilvy Public Relations Worldwide, which has an initial $900,000 contract with the exchange….
And Hollywood, an industry whose major players have been supportive of President Obama and his agenda, will be tapped. Plans are being discussed to pitch a reality television show about “the trials and tribulations of families living without medical coverage,” according to the Ogilvy plan. The exchange will also seek to have prime-time television shows, like “Modern Family,” “Grey’s Anatomy” and Univision telenovelas, weave the health care law into their plots. “I’d like to see 10 of the major TV shows, or telenovelas, have people talking about ‘that health insurance thing,’ ” said Peter V. Lee, the exchange’s executive director. “There are good story lines here.”
Indeed, there are many good story lines – and television show ideas – from Obamacare. We have several we’d like to suggest:

“The Office:” Kathleen Sebelius and federal bureaucrats channel Dwight Schrute in the famous “Health Care” episode, deciding which treatments and diseases will, and will not, be covered under Obamacare. No word yet on whether Count Choculitis will in fact be considered a covered benefit under the law.

“Lost:” Instead of being trapped on an island, participants in this series will instead be marooned in a vast federal bureaucracy including 159 new boards, bureaucracies, and programs, along with over 12,800 pages of regulations. In the pilot episode, thousands of small businesses found that Obamacare’s complex small business tax credit left them stranded and confused amidst a complicated array of paperwork that bogged down their firms – and saw many businesses not qualify for a credit at all.

Nick Riviera, M.D.:” The networks originally proposed a revival of the popular “Marcus Welby” series. Unfortunately, due to Obamacare’s unsustainable reductions in Medicare reimbursement rates, Dr. Welby – along with many other medical providers – will soon stop practicing medicine. As a result, the networks resorted to “The Simpsons’” most famous graduate of Hollywood Upstairs Medical College. Expect to see members of the medical review board as recurring characters in this show…

“Unhappy Days:” In this show, Tom Bosley is forced to shrink his hardware store business, as Obamacare’s employer mandate will discourage new employment. Rather than pay tens of thousands of dollars in penalties, he stops hiring new workers and converts his full-time employees to part-time status. His workers respond with a single despondent reaction: “Whoa!

Coming soon to a small screen near you!
9-17-12 - How the Status Quo Leaves Medicare Ripe for Abuse
Yesterday, the Washington Post ran its second major expose in as many months about abuses in the Medicare program. Last month’s article was about the way drug companies abused reimbursement for anti-anemia drugs; yesterday’s piece focused on providers “up-coding” – that is, claiming to see patients for longer and more intense visits, so as to claim higher reimbursement from Medicare. The article notes the practice has become widespread, and costs Medicare billions annually:
Thousands of doctors and other medical professionals have billed Medicare for increasingly complicated and costly treatments over the past decade, adding $11 billion or more to their fees — and signaling a possible rise in medical billing abuse, according to an investigation by the Center for Public Integrity.
Between 2001 and 2010, doctors increasingly moved to higher-paying codes for billing Medicare for office visits while cutting back on lower-paying ones, according to a year-long examination of about 362 million claims. In 2001, the two highest codes were listed on about 25 percent of the doctor-visit claims; in 2010, they were on 40 percent. Similarly, hospitals sharply stepped up the use of the highest codes for emergency room visits while cutting back on the lowest codes….
Medicare billing data do not indicate that patients are getting more infirm, as their reasons for visiting their doctors were essentially unchanged over time. And annual surveys by the federal Centers for Disease Control and Prevention have found little increase in the amount of time physicians spend with patients. That suggests that at least part of the shift to higher codes is due to “upcoding” — also known as “code creep” — a form of bill-padding in which doctors and others bill Medicare for more expensive services than were actually delivered, according to health experts and the data analysis by the center.
Because physicians and hospitals are paid by Medicare in a fee-for-service format according to the services they perform, many have discovered that they can get paid more by billing for more, and/or more intense, procedures and services. Ironically, the Post article notes that “the aggressive push to electronic medical records” – which Obama Administration officials claimed would lower health costs – “is likely fueling the trend toward higher codes” and greater Medicare spending.
What does Obamacare do to change fee-for-service medicine? The answer ranges from “precious little” to “not enough.” The law does include various demonstration programs designed to improve coordination of care, and shift emphasis back towards primary care physicians. But the non-partisan Congressional Budget Office, in a January report analyzing dozens of Medicare demonstration programs over decades, said these programs did not contain health costs – because of the flawed and perverse incentives included in fee-for-service medicine:
The evaluations show that most programs have not reduced Medicare spending….Demonstrations aimed at reducing spending and increasing quality of care face significant challenges in overcoming the incentives inherent in Medicare’s fee-for-service payment system, which rewards providers for delivering more care
Ironically, Medicare premium support could encourage a movement away from fee-for-service medicine – by offering an avenue for providers and insurers to come up with new and innovative payment methods that focus on value and quality rather than performing services. But President Obama and liberal Democrats have decided to oppose these reforms – which means that, under President Obama, we’re likely to see even more stories about how Medicare providers are manipulating and abusing the reimbursement system to the tune of billions of dollars
9-12-12 - Which is Greater: $2 Billion or $843 Billion?
Yesterday the Administration released a report claiming that Obamacare saved Americans from more than $2 billion in health insurance premiums. The report includes many questionable assumptions; one footnote admits the claim that rate review reduced individual insurance premiums by 1.4 percent was “not weighted by enrollment” – meaning that the numbers in the report could have very little resemblance to what individuals actually purchased in the “real world.” Politico concluded this morning that the HHS “analysis” was deceptive:

[Administration officials] admitted during a conference call yesterday that the report did not distinguish between savings from rate reviews that would have been achieved by the state systems in place before [Obamacare] came along and savings from the law's new mandatory review of double-digit increases, for instance. And it did not estimate what greater savings had been gotten from the substantial assistance HHS has given to states to beef up their rate review operations. Long story short: The lead on the press release — “The health care law — the Affordable Care Act — has saved consumers an estimated $2.1 billion on health insurance premiums” — is a little misleading.

Of course, there’s a reason why the Administration felt the need to put out this “misleading” report yesterday – to distract from Tuesday’s coverage of the annual Kaiser survey on employer-provided insurance, which showed that premiums went up by nearly $700 per family this year. That increase is in direct contradiction to candidate Obama’s repeated promises to CUT premiums by $2,500 per family. Overall, premiums have gone up by $3,065 per family since Barack Obama was elected President, compared to his promise that premiums would go down by $2,500 per family.

In light of yesterday’s Kaiser Foundation study, and today’s release of updated Census Bureau data on health insurance coverage, we’ve revised the JEC paper released last month on the premium impact of Obamacare’s failure to deliver. The updated JEC report, which is attached, finds that the average family has paid $12,791 more in health insurance premiums over the past four years due to Barack Obama’s failed premium promise – and the failed promise has cost the economy as a whole more than $843 billion.

I’m no math major, but last time I checked, $843 billion was a LOT bigger than $2 billion. Meaning that even if you think yesterday’s HHS report isn’t “misleading,” it’s still a mere drop in the bucket when compared to Obamacare’s much larger failure to deliver for the American people.
9-12-12 - "Forward?" Census Data Show Obama's Economic Damage
As we previously noted, the Administration is likely to “spin” the modest gains in the number of insured Americans as due to Obamacare’s under-26 health insurance mandate. Census Bureau officials already mentioned the provision in their conference call announcing the uninsured data, and other Administration officials are likely to follow suit.

But the real story behind today’s uninsured numbers is not that Obamacare worked, but that the “stimulus” didn’t. The graph below tells the tale: From 2007 through 2011, the number of individuals with employer-based insurance fell by nearly 9 million – from 179 million in 2007 to 170.1 million last year – while Medicaid enrollment exploded 28%, from 39.7 million in 2007 to 50.8 million last year. And that’s even before Obamacare could result in 25 million more Americans enrolling in the Medicaid program, according to the Medicare actuary.

As the chart below makes clear, the data reflect economic trends that pre-date President Obama’s term in office. But as last year’s 2.3 million increase in Medicaid enrollment demonstrates, President Obama’s economic policies haven’t improved the existing trends – and in some cases have accelerated the damage. If the Administration wants to claim that Obamacare’s under-26 mandate helped reduce the number of uninsured, then it should similarly accept responsibility for the economic policies under which there are nearly 4 million more uninsured – and over 8 million more individuals on Medicaid – then when Barack Obama was elected four years ago.

9-12-12 - Three Things You Need to Know About Today's Census Uninsured Report
The Census Bureau released their annual report on poverty, income, and the uninsured this morning; the report is now online and can be found here. Important facts you need to know from the health insurance section of the report:

1. Uninsured Numbers Fall Slightly: The total number of uninsured fell to 48.6 million, a decrease of just over 1.3 million compared to 2010’s level of 50.0 million uninsured. The uninsured rate fell 0.6 percentage points to 15.7 percent. It’s also worth noting that the coverage gains, while modest, were relatively consistent across all age, income, and demographic categories – so while the Administration will attempt to attribute most or all of the coverage gains to the under-26 insurance mandate, other factors were also clearly involved.

2. Public Coverage Rises Significantly: While the number of individuals with private insurance rose by about 800,000 individuals, with most of that increase coming from employer-based coverage, the number of individuals with government-provided health insurance rose appreciably. Public insurance coverage increased by 3.9 million, led by an increase in Medicaid enrollment of 2.3 million. The Medicare population also rose by about 2 million, likely reflecting both the retirement of the first Baby Boomers and an increase in disability claims due to the recession. (Note that some people can be enrolled in multiple public programs, explaining why the increase in public insurance coverage is less than the combined increase in Medicaid and Medicare coverage.)

3. SCHIP Crowd-Out Grows: Today’s report saw a continuation of existing trend, in which millions of children have lost private insurance coverage and gained coverage through government programs. Since 2007, the number of children enrolled in private insurance has fallen by nearly 4 million, while the number of children enrolled in Medicaid (which also includes SCHIP) has risen by nearly 5.4 million, or more than 25%. As a reminder, a significant expansion of SCHIP was enacted in February 2009. While it’s unlikely that the entire migration from employer-sponsored coverage to Medicaid was caused by individuals voluntarily dropping out of employer coverage to enroll in government-sponsored coverage, it likely contributed to this ongoing migration.

Also of interest is a breakout of the various cohorts of the uninsured:

· The number of non-citizens (both legal and illegal) without health insurance rose totaled 9.7 million. Non-citizens comprise just under one-fifth of the total number of uninsured.
· According to supplemental data, the number of uninsured individuals with household incomes under $25,000 totaled 19.1 million, or nearly 40% of the 48.6 million uninsured. Many of these individuals may be eligible for public assistance through Medicaid and SCHIP. Also, as noted in greater detail below, a significant number of these uninsured may in fact already be enrolled in public insurance programs, but their insurance status is not accurately reported by the Census data.)
· The number of uninsured individuals with household incomes over $75,000 totaled 7.5 million, or just over 15% of the 48.6 million uninsured. Many of these individuals may be able to obtain coverage on their own, but may choose not to do so if they do not consider the insurance policies offered to be of value to them.

Both a specific and a general caveat on the Census data. First, the income-based data cited in the two bullets directly above may have reliability issues, particularly when compared to prior year reports. For instance, last year’s Census report found 16.1 million uninsured in families with household incomes under $25,000. For this particular group of uninsured to rise by 3 million (from 16.1 million in last year’s report to 19.1 million today), at a time when the uninsured population as a whole was falling by 1.3 million, seems contradictory. This potential anomaly may explain why the income-based data were relegated to a supplemental spreadsheet on the Census website this year, rather than being placed in the report itself, as was the custom in prior years.

Second, and more generally, while the Census Bureau figure of uninsured Americans is among the most widely reported, it is far from the only measure used – or the most accurate. Many indicators confirm that the Census survey represents a “point-in-time” snapshot of the uninsured population at any given moment, and does not reflect the number of individuals without insurance for long periods of time – those in most need of assistance. For instance, while the Census report found 50.7 million uninsured in 2009, a separate study by the Centers for Disease Control found that 32.8 million Americans were uninsured for one year or longer in 2009, and a survey of health spending conducted by the Department of Health and Human Services found 41.3 million non-elderly Americans lacked coverage for all of 2009. In 2009, the Census survey saw a larger jump in the number of uninsured than the other two reports, which could be a result of methodological flaws, and/or the fact that many of the uninsured lacked health coverage for periods of less than a year. (For a further discussion of these issues, see also a 2006 Kaiser Family Foundation brief comparing the uninsured surveys, as well as a 2003 CBO analysis of the long-term uninsured.)

It is also worth noting that the Census survey relies on individuals to self-report their insurance status, and some individuals may not remember periods of health insurance coverage. Adding a “residual” question to the Census survey in 2000 – to confirm that those without employer, individual, or government coverage were in fact uninsured – reduced the number of uninsured Americans by 8 percent. One survey conducted for the Department of Health and Human Services in 2005 adjusted for the number of individuals which the Centers for Medicare and Medicaid Services (CMS) reported were enrolled in Medicaid, but who did not report insurance coverage for the Census survey. Such adjustments for the Medicaid undercount reduced the number of uninsured by about 9 million – or one-fifth of the total uninsured – and the number of uninsured children by half. For these reasons, the Census Bureau report itself admits that “health insurance coverage is underreported [in the Census data] for a variety of reasons,” meaning that by Census’ own admission, the number of uninsured is lower than its report indicates
9-11-12 - Higher Premiums Now, Higher Premiums Later
As we’ve previously reported, the main take-away from the Kaiser survey of employer-sponsored coverage is that premiums rose this year by an average $672 per family – and more than $3,000 since Barack Obama was elected in 2008. Worse yet, a look at other elements of the survey demonstrates that many Americans will be affected by even higher premiums when all of Obamacare’s mandates take effect:

  • Eight percent of covered workers face a waiting period of four or more months (Exhibit 3.8, p. 60) to qualify for employer health coverage. But the law specifies that employers must shorten waiting periods to no more than 90 days. These workers will face premium increases thanks to Obamacare.
  • Approximately one in seven (14%) covered workers – and more than one in four (27%) covered workers in small firms – have single deductibles of $2,000 or more (Exhibit 7.6, p. 117). But the law caps deductibles for a single policy at $2,000. These workers will face premium increases thanks to Obamacare.
  • A majority (51%) of workers in high deductible health plans have family plan deductibles of over $2,000 (Exhibit 8.8, p. 160). But the law caps single plan deductibles at $2,000 per year. These workers will face premium increases thanks to Obamacare.
  • More than two in five (42%) workers in high deductible health plans have family plan deductibles of over $4,000 (Exhibit 8.10, p. 162). But the law caps family plan deductibles at $4,000 per year. These workers will face premium increases thanks to Obamacare.
  • More than one in eight covered workers (13%) are in plans with no annual out-of-pocket maximum (Exhibit 7.29, p. 140). But the law prohibits annual limitation on cost-sharing above a government-defined threshold. These workers will face premium increases thanks to Obamacare.

All these workers will face premium increases as a direct result of provisions in Obamacare. And that assumes that workers will get to keep their coverage at all. For the nearly one in five (19%) workers in high-deductible plans, Secretary Sebelius and HHS will publish regulations that hold the potential for many, if not most, high-deductible plans to be considered NOT “government-approved.” And given that premiums in high-deductible and consumer-driven health plans were more than $2,000 cheaper than the average PPO insurance policy, according to the Kaiser study, a finding by the Administration that these plans are not “government-approved” will result in millions more Americans BOTH losing their current coverage AND being forced to purchase even more expensive insurance.

Democrats will claim that today’s higher premiums are an anomaly. But looking at the survey data, and analyzing the provisions of the law, it becomes obvious that when it comes to skyrocketing premiums thanks to Obamacare, you ain’t seen nothing yet.

9-11-12 - Obama's Health Care Legacy: A $3,000 Premium Increase
The most important story in health care today involves the release of the Kaiser Family Foundation’s annual survey of employer-sponsored health insurance premiums. According to the survey, premiums rose by $56 per month, or $672 per year, for the average family health insurance plan – that’s an increase of more than 4 percent, more than twice the rate of inflation.

As a reminder, candidate Obama said repeatedly his bill would CUT premiums by an average of $2,500 per family – meaning premiums would go DOWN, not merely just “go up by less than projected.” The campaign also promised that that those reductions would occur within Obama's first term. However, the annual Kaiser Foundation survey of employer-provided insurance found that average family premiums totaled $12,680 in 2008, $13,375 in 2009, $13,770 in 2010, $15,073 in 2011, and $15,745 this year. In other words, while candidate Obama promised premiums would fall by $2,500 on average, premiums have risen by $3,065 since Barack Obama was elected President. (A visual representation of this broken promise – updated to reflect this year’s survey data – is attached below my signature.)

Other conclusions from the Kaiser study:

· You CAN’T Keep Your Current Coverage: The survey found that a majority (52%) of workers have now been forced out of their pre-Obamacare coverage – that’s an increase of 8 percent from just last year. The loss of employees’ pre-Obamacare coverage is occurring even faster than the Administration’s own estimates, which concluded half of all employers – and as many as 80% of small businesses – will be forced to give up their current coverage by 2013. Just as important, by giving up their pre-Obamacare plans, both employers and employees will be subjected to costly new mandates that will increase premiums.
· New Requirements are Raising Premiums: Significant percentages of workers were in plans that had to change their services covered (41%) or cost-sharing requirements (33%) to meet Obamacare’s new preventive service mandates. And the percentage of plans having to increase their benefits due to Obamacare rose by 10 percent when compared to last year. These new mandates by definition will raise premiums for plans, as this year’s premium increase demonstrates.

Just before Obamacare passed, former Speaker Pelosi famously said we had to pass the bill to find out what’s in it. Today we have once again found out just how much the 2700-page law is failing to live up to the President’s promises.
9-10-12 - The Obama Campaign's Magical Medicare Mystery Tour
Over the weekend, the Obama campaign renewed their refrain of “Mediscare” attacks during a series of speeches in Florida. The new hook for the President was a Center for American Progress study, which we have already debunked elsewhere. One of the study’s authors was Harvard economist David Cutler – and a new National Journal piece (subscription required) shows that the “hot shot of the health economics world” has, shall we say, evolved slightly when it comes to reforming Medicare:

· I In an e-mail to staff of the Simpson-Bowles fiscal commission back in 2010, Cutler proposed “removing the special status of traditional Medicare.” In the CAP report he co-authored just last month, Cutler said that “the Romney-Ryan plan increases system-wide costs by promoting private insurance that will be more costly than the existing [traditional] Medicare system.”

· The introduction to the CAP paper last month said that Governor Romney and Chairman Ryan “want to convert our nation’s Medicare program into a voucher system for people who are under 55 years of age.” Which is exactly what Cutler himself proposed back in 2010, when he wrote the Simpson-Bowles commission and suggested “moving the Medicare population into the exchanges…that would be the same as the voucher.” As the National Journal article notes, “Cutler wasn’t just recommending that the Democrats incorporate vouchers into Medicare, something the Obama campaign is squarely against now. He was also proposing that the federal government move seniors into insurance exchanges through a much-criticized executive-branch Medicare board [i.e., the Independent Payment Advisory Board created by Obamacare]. That is a proposition you won’t hear in talking points from either Cutler or the Obama campaign.”

· In the CAP paper last month, Cutler wrote that “private insurance that will be more costly than the existing Medicare system.” Which is the exact opposite of the conclusion reached in another August article, this one in the Journal of the American Medical Association: “beneficiaries must pay more for traditional Medicare or join a private plan.” And one of the authors of that JAMA piece? You guessed it – David Cutler.
So the highlight of the Obama campaign’s “Mediscare” mud-slinging argument is an analysis from someone who has flip-flopped on 1) keeping traditional Medicare’s preferred status; 2) converting Medicare into a “voucher” program; and 3) whether traditional Medicare will be more or less costly than private insurance plans (with that last flip-flop taking place in the lengthy time span of three weeks). When trying to explain away his contortions on Medicare reform, Cutler told National Journal he was “trying to explain health care economics to people who are not economists or health care specialists….I agree, people should read my articles and books. But if they don’t, I need to communicate in pieces.” In other words, believe Cutler – or at least some of the “pieces” of his analysis – instead of your own lying eyes.
One thing’s for certain: There’s a whole lot of change in these disingenuous assaults by Team Obama. But there isn’t a lot of hope in them, that’s for sure. Nor is there a lot of principle either.

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