The desperate defense of Obamacare has some Obamacare fans making arguments that are tending towards the more acerbic and more misleading than ever before in their attempts to defend the law. Here we address the 20 percenters, those writers proclaiming Obamacare success because the CBO projects that the federal government outlays for Obamacare will be 20 percent less than originally projected.
In response to the release by the Congressional Budget Office’s January 2015 “Updated Estimates of the Insurance Coverage Provisions of the Affordable Care Act,” CBO, 1/15/15, http://www.cbo.gov/sites/default/files/cbofiles/attachments/49892-breakout-AppendixB.pdf,” there were many Obamacare supporters who played the role of the stooge perfectly. These 20 percenters become the reporting clowns for Obamacare, weaving entertaining tales of success amidst failure, of government savings amidst consumer misery, avoiding data that suggest that health insurance and healthcare remain unaffordable for Americans.
1-20 percenters arguing the SUCCESS of Obamacare based on the changes to the law since 2010, including the Supreme Court decision making Medicaid expansion optional and the recession.
The 20 percent reduction in federal outlays is based on 2010 estimates, before Obamacare was enacted. The CBO acknowledges: “The downward revision since March 2010 to CBO and JCT’s estimate of the net federal costs of the ACA’s insurance coverage provisions…is attributable to many factors: Changes in law, revisions to CBO’s economic projections, the Supreme Court decision that made the expansion of eligibility for Medicaid optional for states, administrative actions, new data, and views differ on how much of the slowdown is attributable to the recession,” (CBO, page 15).
2-20 percenters arguing about reductions in overall federal government outlays for Obamacare when overall federal spending can’t be determined.
The CBO makes projections from year to year about the direct insurance coverage provisions of Obamacare and their costs to the federal government compared to their own prior projections. But the CBO tells us that it cannot determine the OTHER BUDGETARY EFFECTS, the non-direct insurance coverage effects of Obamacare on things like Medicare and the tax code, among others.
The CBO states, “…estimates address only the insurance coverage provisions of the ACA and do not reflect all of the act’s budgetary effects…The incremental budgetary effects of those noncoverage provisions…cannot all be separately identified using the agency’s normal procedures. As a result, CBO does not produce estimates of the budgetary effects of the ACA,” (page 1).
3-20 percenters focusing on the OLDEST CBO Obamacare information to make a splashier headline regarding a 20 percent lower projection of federal outlays rather than the 7 percent lower projection of outlays based on CBO projections from last year to this year. That’s the 20 percenters, or should we call them the seven percenters?
The CBO has made more recent projections since 2010, so why aren’t the storytellers using projections from last year, 2014? Could it be because the REDUCTION IN OUTLAYS (COSTS) are reduced by only 7 percent (rather than 20) compared to last year’s projections? “…lowered estimate of net costs [to the federal government]…7 percent…[from last year’s projections], (CBO, 1/15/15, page 11).
4- 20 percenters applauding lower than anticipated enrollment EVERY YEAR accounting for less federal money being spent on premium assistance tax credits.
The CBO predicts savings in federal outlays from premium assistance tax credits because, “Lower estimated enrollment in coverage obtained through the exchanges in every year accounts for the majority of the $28 billion reduction in the estimated cost of premium assistance tax credits,” (CBO, page 11).
5-20 percenters celebrating that more people than expected will be under-insured risking financial devastation in the event of illness just to save money on premiums.
The CBO predicts the government will save money on cost-sharing subsidies, the payments available only to individuals who choose a silver plan and better because more people than anticipated are choosing bronze plans.
The CBO predicts “…more people will forgo those subsidies by choosing to enroll in a bronze plan instead of a silver plan…the agencies expect that some people purchasing coverage through exchanges solely to comply with the individual mandate will be focused on minimizing their premium payments and thus will continue to choose bronze plans.’”(CBO, page 13).
6-The 20 percenters are celebrating that Medicaid is costing a lot more than projected.
“Medicaid and CHIP under the ACA over the 2015–2024 period will be $851 billion, $59 billion (7 percent) more than the April 2014 projection. Roughly half of the upward revision reflects an increase in the estimated share of people enrolling in Medicaid under the ACA who will be newly eligible…Federal costs per Medicaid enrollee are much higher for those who are newly eligible…because the federal government pays a larger share of the costs for the newly eligible…” (CBO, 1/15/15, page 13).
To me it’s obvious that the Obamacare defenders, the 20 percenters, the storytelling authors who act as stooges for Obamacare have sacrificed all to defend the law, their credibility, their ability to cover the whole story in their storytelling, and ultimately their concern for citizens who need accuracy to better communicate and influence decisions that are affecting our lives.
Instead the 20 percenters ignore clear indications of consumer experience with the measurements of Obamacare considered by the CBO that show a population that is still suffering from financial challenges making more of them than expected newly eligible for Medicaid, a population that is still gravely concerned about their expenses for health insurance to the point of trying to save money by purchasing less adequate insurance coverage and a population whose uninsured population has not gone down as much as hoped for with the passage of this law.
Showing posts with label government spending ACA. Show all posts
Showing posts with label government spending ACA. Show all posts
Wednesday, February 25, 2015
Monday, February 23, 2015
The last Happy Graph, Healthcare Costs Per Capita: “Obamacare and Healthcare SPENDING, Chait v. Moore Part IV”
This is the fourth part of my Chait v. Moore series concerning Jonathan Chait’s article, “Guy Who Gets Paid to Say Obamacare Doesn’t Work Can’t Find a Single True Fact to Support His Case,” Jonathan Chait, NEW YORK MAGAZINE 2/18/15, http://nymag.com/daily/intelligencer/2015/02/obamacare-hater-cant-find-single-true-fact.html, (Chait), and Stephen Moore’s article, “Affordable care that isn’t affordable: Despite the President’s promises, health care costs are going up,” Stephen Moore, THE WASHINGTON TIMES, 2/15/15, http://www.washingtontimes.com/news/2015/feb/15/stephen-moore-affordable-care-act-isnt-affordable/, (Moore).
In Part I we determined that based on the CBO’s information and lack of information that the “all of the act’s budgetary effects” could not be determined, Congressional Budget Office’s January of 2015, “Updated Estimates of the Insurance Coverage Provisions of the Affordable Care Act,” http://www.cbo.gov/sites/default/files/cbofiles/attachments/49892-breakout-AppendixB.pdf, page 1.
In Part II, we saw that both Stephen Moore and Jonathan Chait mislead consumers by honing in on specific pieces of information that are accurately reported but are used to draw conclusions that they cannot prove, specifically, overall spending for Obamacare. We also get to the point that what the CBO does forecast is how spending is going based on its prior guesses to what they’ve determined to be happening so far that the CBO then uses for projections about Obamacare spending for the items it reports on.
In Part III, breaking down the CBO’s report we found that although federal spending on the specific coverage-only provisions is projected to go down for the next years, there are significant miscalculations the CBO made that it has adjusted in its 2015 projection report, Congressional Budget Office, 1/15/15, “Updated Estimates of the Insurance Coverage Provisions of the Affordable Care Act.” These adjustments indicate that we can rely on some projections but not all that have come out of the CBO and that the REASONS the CBO provides for some of its adjustments that raise a RED FLAG regarding Obamacare now and moving forward.
That brings us to the issue addressed currently: The last Happy Graph, Healthcare Costs Per Capita: Part IV of, “Obamacare and Healthcare SPENDING, Chait v. Moore Part IV.”
In his article, Stephen Moore refers to “This stampede of rising health costs…” (Moore) and that gets Jonathan Chait off and running on his next lecture regarding the convention of what health costs are defined as versus what federal spending is. Health care costs Chait explains are “how much we pay for our treatments (which happens to be much more than what people in other countries pay),” (Chait) Federal spending on healthcare are the overall costs (which we know cannot be determined) that INCLUDE health care costs, what the federal government spends on outlays for health care treatments for individuals.
FIRST: Scolding Moore in this context is little more than an effort by Jonathan Chait to discredit Stephen Moore. Health care costs are a part of federal spending to the extent that the federal government has OUTLAYS for the costs of treatments for individuals. These costs for treatments as Chait notes are much higher in the US than other countries.
BUT CHAIT also misleads. Chait includes a happy graph after stating that “…Obamacare would try to tame the long-term trend toward health-care inflation. That is not only happening, it is happening in a far more dramatic way than even the most optimistic advocates predicted,” (Chait). It turns out that Mr. Chait credits Obamacare with doing more than the government dare take credit for in its own publications.
The PRICE of different medical services has NOT gone down. Consider the 8/31/2014 article, “Surgery Prices Surge With Innovation and Consolidation Under Obamacare,” by Bill Briggs, NBC News, http://www.nbcnews.com/health/health-care/surgery-prices-surge-innovation-consolidation-under-obamacare-n191901, that reports that according to Dr. Jeffrey J. Rice, Chief Executive Officer of Healthcare Bluebook, based in Brentwood, Tennessee, that “Overall, health care inflation has averaged about four percent per year during the past five years.”
Yet, according to Chait’s happy graph, the INCREASE in per capita healthcare costs, the outlay for medical services paid for by the federal government has slowed down. So, if healthcare PRICES, the cost of specific treatments is going up, WHY is there a slowdown in how much healthcare costs are going up for the federal government?
SECOND: Does Jonathan Chait know more than the federal government? Jonathan Chait attributes the graph results of slower growth in real per capita national health expenditures to Obamacare successfully “bending the curve,” and “[taming] the long-term trend toward health-care inflation,” (Chait).
Chait’s optimistic interpretation goes further than even the White House. All reliable sources (including the White House and CMS) attribute at least SOME of the slowdown to sequestration (see for example, http://www.cms.gov/Newsroom/MediaReleaseDatabase/Press-releases/2014-Press-releases-items/2014-12-03-2.html, “Press release: National Health Expenditures continued slow growth in 2013,” 12/3/2014. Naturally, since most liberals were against sequestration, this was omitted by Mr. Chait.
As consumers we know that payers save money when consumers can’t afford to actually use their health insurance because they’re nervous about paying their share of those costs in the form of out-of-pocket expenses including deductibles, copayments and coinsurance. The White House confirms this.
In a White House best-case-scenario release called, “Recent Trends in Health Care Costs, Their Impact on the Economy, and the Role of the Affordable Care Act,” http://www.whitehouse.gov/sites/default/files/docs/erp_2014_chapter_4.pdf (cited here as White House), the government explains that government savings reflect the fact that “[T]he 2007-09 recession and its aftermath have likely played some role in the recent slowdown in health costs, and this portion of the slowdown is likely to fade…” (White House, page 2). (This is utilization, if you don’t go to the doctor neither you nor the payer, in this case the government pays anything to a doctor).
Unlike Jonathan Chait, the government is uncertain about the full impact of the recession and people’s choices not to utilize healthcare services. The government notes that the full impact of the recession is unknown when it comes to government savings, “…the slowdown is not yet fully understood…” (White House, page 2).
Unlike Jonathan Chait, the White House acknowledges that other influences are helping the Obamacare numbers regarding growth in per capita health expenditures look good in terms of being slower than they have been in a long time. “While various non-recession factors unrelated to the ACA appear to be contributing to the recent slow growth in spending—including a long-term decline in the development of new prescription drugs and a long-term increase in cost-sharing in employer sponsored plans—the ACA is also playing a meaningful role,” (White House, pages 2-3). Fewer new drugs and more cost-sharing in employer-sponsored plans meaning that for 48% of the population estimated to have employer-sponsored plans are paying higher out-of-pocket costs are also contributing to slower growth in expenditures.
When it comes to the “ACA…role,” the government itself isn’t sure whether the ACA has anything to do with the slowdown in the increase in outlays per individual. The White House report indicates that incentives paid to providers “APPEAR [emphasis added] to be beginning to bear fruit,” such as incentives for reducing hospital readmissions and increased health care provider participation in payment models designed to promote high-quality, integrated care. (White House, page 3).
Regarding the ACA role the White House reflects even more uncertainty about what the ACA’s “role” might be discussing results that SUGGEST that Obamacare “MAY GENERATE SPILLOVER BENEFITS,” [caps added] (White House, page 3).
If Jonathan Chait is interested about what the Congressional Budget Office actually states on its Health Care page for January 2015, it says, “Spending on federal health care programs is growing rapidly, driven by both rising enrollment—stemming from the aging of the population and expansions of federal programs—AND RISING HEALTH CARE SPENDING PER ENROLLEE,” [caps added], https://www.cbo.gov/topics/health-care, “Insurance Coverage Provisions of the Affordable Care Act—CBO’s January 2015 Baseline.”
Third: Mr. Chait addresses Mr. Moore’s assertion that “…employers are also dropping their health coverage and dumping employees and their families on Medicaid and the Obamacare exchanges,” (Moore). Mr. Chait argues that “Obamacare has not caused employers to drop coverage,” (Chait).
But Mr. Chait’s one-liner doesn’t address the CBO 1/15/15 projections about the uninsured population which states: “In 2018 and later years, between 24 million and 25 million people are projected to have coverage through the exchanges, and 14 million to 16 million more, on net, are projected to have coverage through Medicaid and CHIP than would have had it in the absence of the ACA. Partly offsetting those increases, however, are projected net decreases of 9 million to 10 million in the number of people with employment-based coverage,” (CBO, 1/15/15, page 4). (Emphasis added).
While the CBO does not credit the ACA with the projection of net decreases of 9 to 10 million with employment-based coverage, it certainly indicates at least a correlation if not causation.
SUMMARY: The federal outlay of money for Obamacare is significant to consumers but the way those outlays are considered by the government they cannot be fully sorted out. What can be sorted out are calculations about the specific coverage outlays of money associated with the ACA that the federal government is making.
Within that narrow consideration are Congressional Budget Office projections from year-to-year about how we’re doing with those specific coverage only outlays of money. For Medicaid those costs are higher than were projected by the CBO. For premium tax credits and cost-sharing money, the outlays have been lower primarily because fewer people are enrolling than the CBO anticipated and because the individuals who are enrolling are choosing cheaper bronze plans more often than the CBO anticipated which means that we’ll see a larger number of people who risk financial devastation in the face of illness because a larger number of people will have less financial protection under the cheaper plans.
Finally, in the face of rising medical PRICES for services, payers have seen a slower rise in the amount of money they’re paying out for health costs per capita, the per person amount of money they’ve spent on medical treatments attributed to sequestration, lower utilization because of the recession and higher out-of-pocket amounts that consumers must pay. Further, the data APPEAR to indicate that ACA provisions incentivizing structural changes could be having a beneficial effect on healthcare costs.
CONCLUSION: As consumers we are concerned with the ACA's fiscal performance because in addition to government strategies that are already in place to limit government spending as explained by the CBO,"...if total exchange subsidies exceed a certain threshold in any year after 2017-- a condition that CBO and JCT expect to be satisfied in some years--people will be required to pay a larger share of premiums..." (CBO, 1/15/15, page 3), there will undoubtedly be other government adjustments to curb government expense.
We should be concerned that newly enrolled and therefore more expensive populations of Medicaid enrollees were underestimated and that the costs of Medicaid were also underestimated. But as the issue with premium tax credits and cost-sharing subsidies indicate, we must also be concerned when meeting or beating fiscal targets is primarily achieved through consumer UN-FRIENDLY conditions such as more consumers than the CBO thought would who are purchasing less coverage (bronze instead of silver plans)to try to save money on premiums. We should also be concerned when government savings in costs are attributed to consumers using their healthcare less often because they're worried about finances, utilization and higher amounts of money demanded from consumers in terms of out-of-pocket expenditures, both of which are currently true.
In Part I we determined that based on the CBO’s information and lack of information that the “all of the act’s budgetary effects” could not be determined, Congressional Budget Office’s January of 2015, “Updated Estimates of the Insurance Coverage Provisions of the Affordable Care Act,” http://www.cbo.gov/sites/default/files/cbofiles/attachments/49892-breakout-AppendixB.pdf, page 1.
In Part II, we saw that both Stephen Moore and Jonathan Chait mislead consumers by honing in on specific pieces of information that are accurately reported but are used to draw conclusions that they cannot prove, specifically, overall spending for Obamacare. We also get to the point that what the CBO does forecast is how spending is going based on its prior guesses to what they’ve determined to be happening so far that the CBO then uses for projections about Obamacare spending for the items it reports on.
In Part III, breaking down the CBO’s report we found that although federal spending on the specific coverage-only provisions is projected to go down for the next years, there are significant miscalculations the CBO made that it has adjusted in its 2015 projection report, Congressional Budget Office, 1/15/15, “Updated Estimates of the Insurance Coverage Provisions of the Affordable Care Act.” These adjustments indicate that we can rely on some projections but not all that have come out of the CBO and that the REASONS the CBO provides for some of its adjustments that raise a RED FLAG regarding Obamacare now and moving forward.
That brings us to the issue addressed currently: The last Happy Graph, Healthcare Costs Per Capita: Part IV of, “Obamacare and Healthcare SPENDING, Chait v. Moore Part IV.”
In his article, Stephen Moore refers to “This stampede of rising health costs…” (Moore) and that gets Jonathan Chait off and running on his next lecture regarding the convention of what health costs are defined as versus what federal spending is. Health care costs Chait explains are “how much we pay for our treatments (which happens to be much more than what people in other countries pay),” (Chait) Federal spending on healthcare are the overall costs (which we know cannot be determined) that INCLUDE health care costs, what the federal government spends on outlays for health care treatments for individuals.
FIRST: Scolding Moore in this context is little more than an effort by Jonathan Chait to discredit Stephen Moore. Health care costs are a part of federal spending to the extent that the federal government has OUTLAYS for the costs of treatments for individuals. These costs for treatments as Chait notes are much higher in the US than other countries.
BUT CHAIT also misleads. Chait includes a happy graph after stating that “…Obamacare would try to tame the long-term trend toward health-care inflation. That is not only happening, it is happening in a far more dramatic way than even the most optimistic advocates predicted,” (Chait). It turns out that Mr. Chait credits Obamacare with doing more than the government dare take credit for in its own publications.
The PRICE of different medical services has NOT gone down. Consider the 8/31/2014 article, “Surgery Prices Surge With Innovation and Consolidation Under Obamacare,” by Bill Briggs, NBC News, http://www.nbcnews.com/health/health-care/surgery-prices-surge-innovation-consolidation-under-obamacare-n191901, that reports that according to Dr. Jeffrey J. Rice, Chief Executive Officer of Healthcare Bluebook, based in Brentwood, Tennessee, that “Overall, health care inflation has averaged about four percent per year during the past five years.”
Yet, according to Chait’s happy graph, the INCREASE in per capita healthcare costs, the outlay for medical services paid for by the federal government has slowed down. So, if healthcare PRICES, the cost of specific treatments is going up, WHY is there a slowdown in how much healthcare costs are going up for the federal government?
SECOND: Does Jonathan Chait know more than the federal government? Jonathan Chait attributes the graph results of slower growth in real per capita national health expenditures to Obamacare successfully “bending the curve,” and “[taming] the long-term trend toward health-care inflation,” (Chait).
Chait’s optimistic interpretation goes further than even the White House. All reliable sources (including the White House and CMS) attribute at least SOME of the slowdown to sequestration (see for example, http://www.cms.gov/Newsroom/MediaReleaseDatabase/Press-releases/2014-Press-releases-items/2014-12-03-2.html, “Press release: National Health Expenditures continued slow growth in 2013,” 12/3/2014. Naturally, since most liberals were against sequestration, this was omitted by Mr. Chait.
As consumers we know that payers save money when consumers can’t afford to actually use their health insurance because they’re nervous about paying their share of those costs in the form of out-of-pocket expenses including deductibles, copayments and coinsurance. The White House confirms this.
In a White House best-case-scenario release called, “Recent Trends in Health Care Costs, Their Impact on the Economy, and the Role of the Affordable Care Act,” http://www.whitehouse.gov/sites/default/files/docs/erp_2014_chapter_4.pdf (cited here as White House), the government explains that government savings reflect the fact that “[T]he 2007-09 recession and its aftermath have likely played some role in the recent slowdown in health costs, and this portion of the slowdown is likely to fade…” (White House, page 2). (This is utilization, if you don’t go to the doctor neither you nor the payer, in this case the government pays anything to a doctor).
Unlike Jonathan Chait, the government is uncertain about the full impact of the recession and people’s choices not to utilize healthcare services. The government notes that the full impact of the recession is unknown when it comes to government savings, “…the slowdown is not yet fully understood…” (White House, page 2).
Unlike Jonathan Chait, the White House acknowledges that other influences are helping the Obamacare numbers regarding growth in per capita health expenditures look good in terms of being slower than they have been in a long time. “While various non-recession factors unrelated to the ACA appear to be contributing to the recent slow growth in spending—including a long-term decline in the development of new prescription drugs and a long-term increase in cost-sharing in employer sponsored plans—the ACA is also playing a meaningful role,” (White House, pages 2-3). Fewer new drugs and more cost-sharing in employer-sponsored plans meaning that for 48% of the population estimated to have employer-sponsored plans are paying higher out-of-pocket costs are also contributing to slower growth in expenditures.
When it comes to the “ACA…role,” the government itself isn’t sure whether the ACA has anything to do with the slowdown in the increase in outlays per individual. The White House report indicates that incentives paid to providers “APPEAR [emphasis added] to be beginning to bear fruit,” such as incentives for reducing hospital readmissions and increased health care provider participation in payment models designed to promote high-quality, integrated care. (White House, page 3).
Regarding the ACA role the White House reflects even more uncertainty about what the ACA’s “role” might be discussing results that SUGGEST that Obamacare “MAY GENERATE SPILLOVER BENEFITS,” [caps added] (White House, page 3).
If Jonathan Chait is interested about what the Congressional Budget Office actually states on its Health Care page for January 2015, it says, “Spending on federal health care programs is growing rapidly, driven by both rising enrollment—stemming from the aging of the population and expansions of federal programs—AND RISING HEALTH CARE SPENDING PER ENROLLEE,” [caps added], https://www.cbo.gov/topics/health-care, “Insurance Coverage Provisions of the Affordable Care Act—CBO’s January 2015 Baseline.”
Third: Mr. Chait addresses Mr. Moore’s assertion that “…employers are also dropping their health coverage and dumping employees and their families on Medicaid and the Obamacare exchanges,” (Moore). Mr. Chait argues that “Obamacare has not caused employers to drop coverage,” (Chait).
But Mr. Chait’s one-liner doesn’t address the CBO 1/15/15 projections about the uninsured population which states: “In 2018 and later years, between 24 million and 25 million people are projected to have coverage through the exchanges, and 14 million to 16 million more, on net, are projected to have coverage through Medicaid and CHIP than would have had it in the absence of the ACA. Partly offsetting those increases, however, are projected net decreases of 9 million to 10 million in the number of people with employment-based coverage,” (CBO, 1/15/15, page 4). (Emphasis added).
While the CBO does not credit the ACA with the projection of net decreases of 9 to 10 million with employment-based coverage, it certainly indicates at least a correlation if not causation.
SUMMARY: The federal outlay of money for Obamacare is significant to consumers but the way those outlays are considered by the government they cannot be fully sorted out. What can be sorted out are calculations about the specific coverage outlays of money associated with the ACA that the federal government is making.
Within that narrow consideration are Congressional Budget Office projections from year-to-year about how we’re doing with those specific coverage only outlays of money. For Medicaid those costs are higher than were projected by the CBO. For premium tax credits and cost-sharing money, the outlays have been lower primarily because fewer people are enrolling than the CBO anticipated and because the individuals who are enrolling are choosing cheaper bronze plans more often than the CBO anticipated which means that we’ll see a larger number of people who risk financial devastation in the face of illness because a larger number of people will have less financial protection under the cheaper plans.
Finally, in the face of rising medical PRICES for services, payers have seen a slower rise in the amount of money they’re paying out for health costs per capita, the per person amount of money they’ve spent on medical treatments attributed to sequestration, lower utilization because of the recession and higher out-of-pocket amounts that consumers must pay. Further, the data APPEAR to indicate that ACA provisions incentivizing structural changes could be having a beneficial effect on healthcare costs.
CONCLUSION: As consumers we are concerned with the ACA's fiscal performance because in addition to government strategies that are already in place to limit government spending as explained by the CBO,"...if total exchange subsidies exceed a certain threshold in any year after 2017-- a condition that CBO and JCT expect to be satisfied in some years--people will be required to pay a larger share of premiums..." (CBO, 1/15/15, page 3), there will undoubtedly be other government adjustments to curb government expense.
We should be concerned that newly enrolled and therefore more expensive populations of Medicaid enrollees were underestimated and that the costs of Medicaid were also underestimated. But as the issue with premium tax credits and cost-sharing subsidies indicate, we must also be concerned when meeting or beating fiscal targets is primarily achieved through consumer UN-FRIENDLY conditions such as more consumers than the CBO thought would who are purchasing less coverage (bronze instead of silver plans)to try to save money on premiums. We should also be concerned when government savings in costs are attributed to consumers using their healthcare less often because they're worried about finances, utilization and higher amounts of money demanded from consumers in terms of out-of-pocket expenditures, both of which are currently true.
CBO’s Projections and Obamacare: What they really tell us: Obamacare and Healthcare SPENDING: Chait v. Moore, Part III
In his article, “Guy Who Gets Paid to Say Obamacare Doesn’t Work Can’t Find a Single True Fact to Support His Case,” Jonathan Chait, NEW YORK MAGAZINE 2/18/15, http://nymag.com/daily/intelligencer/2015/02/obamacare-hater-cant-find-single-true-fact.html, (Chait), Jonathan Chait criticized Stephen Moore’s assessment of the affordability of the ACA [“Affordable care that isn’t affordable: Despite the President’s promises, health care costs are going up,” Stephen Moore, THE WASHINGTON TIMES, 2/15/15, http://www.washingtontimes.com/news/2015/feb/15/stephen-moore-affordable-care-act-isnt-affordable/, (Moore)]
In Part I we determined that based on the CBO’s information and lack of information that the “all of the act’s budgetary effects” could not be determined, Congressional Budget Office’s January of 2015, “Updated Estimates of the Insurance Coverage Provisions of the Affordable Care Act,” http://www.cbo.gov/sites/default/files/cbofiles/attachments/49892-breakout-AppendixB.pdf, page 1.
In Part II, we saw that both Stephen Moore and Jonathan Chait mislead consumers by honing in on specific pieces of information that are accurately reported but are used to draw conclusions that they cannot prove, specifically, overall spending for Obamacare. We also get to the point that what the CBO does forecast is how spending is going based on its prior projections and its new projections for the items on which it reports.
That brings us to Part III of the Chait and Moore articles, Chait’s from the Obamacare-is-working point of view and Moore’s from the Obamacare-is-NOT-working point of view: IS THE GOVERNMENT ACHIEVING ITS FISCAL TARGETS FOR DIRECT HEALTH INSURANCE COVERAGE EXPENSES WITH RESPECT TO A COMPARISON OF CBO PROJECTIONS TO EXPERIENCE SO THAT WE CAN RELY ON CBO PROJECTIONS MOVING FORWARD?
FIRST: In its 1/15/15 report, the CBO PROJECTS that “…the ACA’s coverage provisions will result in net costs to the federal government of $76 billion in 2015 and $1,350 billion over the 2016–2025 period,” (CBO, 1/15/15, page 1). We know that this is NOT a consideration of “all budgetary effects” but those confined to coverage provisions.
SECOND: According to the CBO, these results, “Compared with the projection from last April…represents a downward revision in the net costs of those provisions of $101 billion over those 10 years, or a reduction of about 7 percent,” (CBO, 1/15/15, page 1). What we’re comparing are the projections from 2014 to the projections of 2015 made by the CBO.
THIRD: MEDICAID: Stephen Moore cites a report by the CBO, Congressional Budget Office’s, “Monthly Budget Review for January 2015,” 2/6/15, https://www.cbo.gov/publication/49924, (CBO, 2/16/15), to state that Medicaid spending is up in the first four months of this fiscal year. THIS IS TRUE.
Moore’s mentions that “Medicaid spending is up a stratospheric 23 percent so far this year,” (Moore) and Jonathan Chait becomes furious, launching an off-topic lecture about how Obamacare is supposed to work and honing in on how Medicaid is not welfare. Chait’s response is an irrelevant response to a TRUE statement.
MEDICAID and the Congressional Budget Office: Based on its own projections, the CBO projects that the federal cost of the additional enrollment in Medicaid and CHIP under the ACA over the 2015–2024 period will be $851 billion,$59 billion (7 percent) more than the April 2014 projection,” (CBO, 1/15/15, page 13).
This is a PROBLEM FOR JONATHAN CHAIT and contradicts his own argument put forth to show that Obamacare is meeting its fiscal targets because while he asserts that “the design of Obamacare all along was to spend money to cover the uninsured,” (Chait), EVEN WITH the Supreme Court Decision that made Medicaid expansion an OPTION and therefore REDUCED the number of individuals NEWLY ELIGIBLE for Medicaid, enrollment and EXPENSES are and are projected to continue to be higher than expected.
When it comes to Medicaid, the CBO got it wrong, MEDICAID IS COSTING MORE THAN PROJECTED. As explained in the report, the CBO now states that the “…estimate that enrollment in Medicaid in 2014 among those eligible for the program because of the ACA’s coverage expansion was higher than originally thought and that enrollment among those previously eligible for the program was lower,” (CBO, 1/15/15), p. 13).
There is a tremendous spending impact on getting Medicaid wrong regarding those who become NEWLY ENROLLED because of the expanded Medicaid provisions because as the CBO states, “…because the federal government pays a larger share of the costs for newly eligible enrollees (100 percent to 90 percent, depending on the year) than for other enrollees (an average of 57 percent),” (CBO, 1/15/15, page 14).
In spite of Jonathan Chait’s dancing around the issue, he does NOT address Mr. Moore’s assertion that Medicaid spending is something THAT IS A FISCAL CONCERN and that the CBO confirms federal spending is going to be much higher than projected previously.
FOURTH: PREMIUM TAX CREDITS, COST-SHARING SUBSIDIES SPENDING IS LOWER THAN PROJECTED: While neither Jonathan Chait nor Stephen Moore adequately address federal spending on premium tax credits and cost-sharing subsidies, the CBO DOES. These outlays are projected to be DOWN from prior CBO estimates, so you would think that Jonathan Chait would have jumped on them, but he didn’t and if you read the CBO report you can see why.
The CBO “…reduced their estimate of average enrollment over the course of 2015 by 1 million people, from 13 million to 12 million,” (CBO, 1/15/15, page 11). Jonathan Chait’s declaration of victory that “Obamacare has increased enrollment in its health care exchanges to more than 11 million,” (Chait), is therefore not only less than what the CBO projected (although pretty close so kudos to the CBO), but the CBO projects that “…for 2016, CBO and JCT have also revised downward their estimate of average enrollment through exchanges,” (CBO, 1/15/15, page 13).
The CBO also informs that “Lower estimated enrollment in coverage obtained through the exchanges in every year accounts for the majority of the $28 billion reduction in the estimated cost of premium assistance tax credits,” (CBO, 1/15/15, page 11). This would not support an Obamacare-is-working scenario since Mr. Chait emphasizes as do most liberals, the getting- people-covered goal of Obamacare and therefore savings from lower enrollment than was projected are not supportive of Mr. Chait’s argument.
Cost-sharing subsidies are projected to be lower too, but Jonathan Chait can’t put a possible Obamacare-is-working spin on that, so he omits it.
There’s more bad news on the premium tax credits, cost-sharing subsidies front from the CBO. The CBO has lowered its projections of how much COST-SHARING SUBSIDIES will cost as well, “Outlays for cost-sharing subsidies over the 2015–2024 period are currently projected to be $39 billion less than previously estimated, primarily because CBO and JCT now expect that more people will forgo those subsidies by choosing to enroll in a bronze plan instead of a silver plan,” CBO, 1/15/15, page13. As the report explains, “…eligible low-income individuals must enroll in a silver plan to receive cost-sharing subsidies,” (CBO, 1/15/15).
According to the CBO, why is money being saved on cost-sharing subsidies? BECAUSE “…data suggest that a significant number of people are selecting plans that minimize their monthly premium payments, even if the amounts they ultimately pay for health care (including out-of-pocket payments) exceed what they would pay under silver plans,” (CBO, 1/15/15, page 13).
People are purchasing WORSE health insurance,meaning that provides less coverage protection because their premiums for coverage EVEN WITH premium tax credits are too high. Therefore we’re getting more people who are UNDER-INSURED, who are in financial peril if they become sick, one illness away from financial ruin. Hardly an Obamacare-is-working scenario.
IS THE GOVERNMENT ACHIEVING ITS FISCAL TARGETS FOR DIRECT HEALTH INSURANCE COVERAGE EXPENSES WITH RESPECT TO A COMPARISON OF CBO PROJECTIONS TO EXPERIENCE SO THAT WE CAN RELY ON CBO PROJECTIONS MOVING FORWARD? Yes and no, but federal spending projection errors are significant for consumers.
Next, “The last Happy Graph, Healthcare Costs Per Capita: Part IV of, “Obamacare and Healthcare SPENDING, Chait v. Moore.”
In Part I we determined that based on the CBO’s information and lack of information that the “all of the act’s budgetary effects” could not be determined, Congressional Budget Office’s January of 2015, “Updated Estimates of the Insurance Coverage Provisions of the Affordable Care Act,” http://www.cbo.gov/sites/default/files/cbofiles/attachments/49892-breakout-AppendixB.pdf, page 1.
In Part II, we saw that both Stephen Moore and Jonathan Chait mislead consumers by honing in on specific pieces of information that are accurately reported but are used to draw conclusions that they cannot prove, specifically, overall spending for Obamacare. We also get to the point that what the CBO does forecast is how spending is going based on its prior projections and its new projections for the items on which it reports.
That brings us to Part III of the Chait and Moore articles, Chait’s from the Obamacare-is-working point of view and Moore’s from the Obamacare-is-NOT-working point of view: IS THE GOVERNMENT ACHIEVING ITS FISCAL TARGETS FOR DIRECT HEALTH INSURANCE COVERAGE EXPENSES WITH RESPECT TO A COMPARISON OF CBO PROJECTIONS TO EXPERIENCE SO THAT WE CAN RELY ON CBO PROJECTIONS MOVING FORWARD?
FIRST: In its 1/15/15 report, the CBO PROJECTS that “…the ACA’s coverage provisions will result in net costs to the federal government of $76 billion in 2015 and $1,350 billion over the 2016–2025 period,” (CBO, 1/15/15, page 1). We know that this is NOT a consideration of “all budgetary effects” but those confined to coverage provisions.
SECOND: According to the CBO, these results, “Compared with the projection from last April…represents a downward revision in the net costs of those provisions of $101 billion over those 10 years, or a reduction of about 7 percent,” (CBO, 1/15/15, page 1). What we’re comparing are the projections from 2014 to the projections of 2015 made by the CBO.
THIRD: MEDICAID: Stephen Moore cites a report by the CBO, Congressional Budget Office’s, “Monthly Budget Review for January 2015,” 2/6/15, https://www.cbo.gov/publication/49924, (CBO, 2/16/15), to state that Medicaid spending is up in the first four months of this fiscal year. THIS IS TRUE.
Moore’s mentions that “Medicaid spending is up a stratospheric 23 percent so far this year,” (Moore) and Jonathan Chait becomes furious, launching an off-topic lecture about how Obamacare is supposed to work and honing in on how Medicaid is not welfare. Chait’s response is an irrelevant response to a TRUE statement.
MEDICAID and the Congressional Budget Office: Based on its own projections, the CBO projects that the federal cost of the additional enrollment in Medicaid and CHIP under the ACA over the 2015–2024 period will be $851 billion,$59 billion (7 percent) more than the April 2014 projection,” (CBO, 1/15/15, page 13).
This is a PROBLEM FOR JONATHAN CHAIT and contradicts his own argument put forth to show that Obamacare is meeting its fiscal targets because while he asserts that “the design of Obamacare all along was to spend money to cover the uninsured,” (Chait), EVEN WITH the Supreme Court Decision that made Medicaid expansion an OPTION and therefore REDUCED the number of individuals NEWLY ELIGIBLE for Medicaid, enrollment and EXPENSES are and are projected to continue to be higher than expected.
When it comes to Medicaid, the CBO got it wrong, MEDICAID IS COSTING MORE THAN PROJECTED. As explained in the report, the CBO now states that the “…estimate that enrollment in Medicaid in 2014 among those eligible for the program because of the ACA’s coverage expansion was higher than originally thought and that enrollment among those previously eligible for the program was lower,” (CBO, 1/15/15), p. 13).
There is a tremendous spending impact on getting Medicaid wrong regarding those who become NEWLY ENROLLED because of the expanded Medicaid provisions because as the CBO states, “…because the federal government pays a larger share of the costs for newly eligible enrollees (100 percent to 90 percent, depending on the year) than for other enrollees (an average of 57 percent),” (CBO, 1/15/15, page 14).
In spite of Jonathan Chait’s dancing around the issue, he does NOT address Mr. Moore’s assertion that Medicaid spending is something THAT IS A FISCAL CONCERN and that the CBO confirms federal spending is going to be much higher than projected previously.
FOURTH: PREMIUM TAX CREDITS, COST-SHARING SUBSIDIES SPENDING IS LOWER THAN PROJECTED: While neither Jonathan Chait nor Stephen Moore adequately address federal spending on premium tax credits and cost-sharing subsidies, the CBO DOES. These outlays are projected to be DOWN from prior CBO estimates, so you would think that Jonathan Chait would have jumped on them, but he didn’t and if you read the CBO report you can see why.
The CBO “…reduced their estimate of average enrollment over the course of 2015 by 1 million people, from 13 million to 12 million,” (CBO, 1/15/15, page 11). Jonathan Chait’s declaration of victory that “Obamacare has increased enrollment in its health care exchanges to more than 11 million,” (Chait), is therefore not only less than what the CBO projected (although pretty close so kudos to the CBO), but the CBO projects that “…for 2016, CBO and JCT have also revised downward their estimate of average enrollment through exchanges,” (CBO, 1/15/15, page 13).
The CBO also informs that “Lower estimated enrollment in coverage obtained through the exchanges in every year accounts for the majority of the $28 billion reduction in the estimated cost of premium assistance tax credits,” (CBO, 1/15/15, page 11). This would not support an Obamacare-is-working scenario since Mr. Chait emphasizes as do most liberals, the getting- people-covered goal of Obamacare and therefore savings from lower enrollment than was projected are not supportive of Mr. Chait’s argument.
Cost-sharing subsidies are projected to be lower too, but Jonathan Chait can’t put a possible Obamacare-is-working spin on that, so he omits it.
There’s more bad news on the premium tax credits, cost-sharing subsidies front from the CBO. The CBO has lowered its projections of how much COST-SHARING SUBSIDIES will cost as well, “Outlays for cost-sharing subsidies over the 2015–2024 period are currently projected to be $39 billion less than previously estimated, primarily because CBO and JCT now expect that more people will forgo those subsidies by choosing to enroll in a bronze plan instead of a silver plan,” CBO, 1/15/15, page13. As the report explains, “…eligible low-income individuals must enroll in a silver plan to receive cost-sharing subsidies,” (CBO, 1/15/15).
According to the CBO, why is money being saved on cost-sharing subsidies? BECAUSE “…data suggest that a significant number of people are selecting plans that minimize their monthly premium payments, even if the amounts they ultimately pay for health care (including out-of-pocket payments) exceed what they would pay under silver plans,” (CBO, 1/15/15, page 13).
People are purchasing WORSE health insurance,meaning that provides less coverage protection because their premiums for coverage EVEN WITH premium tax credits are too high. Therefore we’re getting more people who are UNDER-INSURED, who are in financial peril if they become sick, one illness away from financial ruin. Hardly an Obamacare-is-working scenario.
IS THE GOVERNMENT ACHIEVING ITS FISCAL TARGETS FOR DIRECT HEALTH INSURANCE COVERAGE EXPENSES WITH RESPECT TO A COMPARISON OF CBO PROJECTIONS TO EXPERIENCE SO THAT WE CAN RELY ON CBO PROJECTIONS MOVING FORWARD? Yes and no, but federal spending projection errors are significant for consumers.
Next, “The last Happy Graph, Healthcare Costs Per Capita: Part IV of, “Obamacare and Healthcare SPENDING, Chait v. Moore.”
Saturday, February 21, 2015
MAKING IT PERSONAL, Obamacare and Healthcare SPENDING: Chait v. Moore, Part II
By way of example in considering what I see as fact/fictional reporting about Obamacare, I’m using two articles, one written by Jonathan Chait and one by Stephen Moore in my posts. These two articles are:
1-“Guy Who Gets Paid to Say Obamacare Doesn’t Work Can’t Find a Single True Fact to Support His Case,” Jonathan Chait, NEW YORK MAGAZINE 2/18/15 article, http://nymag.com/daily/intelligencer/2015/02/obamacare-hater-cant-find-single-true-fact.html, (Chait).
2-“Affordable care that isn’t affordable: Despite the President’s promises, health care costs are going up,” Stephen Moore, THE WASHINGTON TIMES, 2/15/15, http://www.washingtontimes.com/news/2015/feb/15/stephen-moore-affordable-care-act-isnt-affordable/, (Moore).
In Part I, Chait v. Moore and Obamacare Healthcare Spending, I concluded that neither Jonathan Chait nor Stephen Moore could know for certain the overall budgetary impacts of Obamacare so far because the government itself doesn’t know according to the Congressional Budget Office’s 1/15/15 publication, “Updated Estimates of the Insurance Coverage Provisions of the Affordable Care Act,” cited hereafter as (CBO, 1/15/15, page _), “Obamacare and Healthcare SPENDING: Chait v. Moore Part I,” 2/21/15.
Can we address the issue, “IS THE GOVERNMENT ACHIEVING ITS FISCAL TARGETS FOR SAVING MONEY ON HEALTHCARE SPENDING WITH THE AFFORDABLE CARE ACT?” Not really.
But can we address the issue: IS THE GOVERNMENT ACHIEVING ITS FISCAL TARGETS FOR DIRECT HEALTH INSURANCE COVERAGE EXPENSES WITH RESPECT TO HEALTHCARE SPENDING UNDER THE AFFORDABLE CARE ACT? Not the way Jonathan Chait or Stephen Moore would have us do it.
There is information provided by the CBO providing budget review information released 2/6/15 for January for four months of this fiscal year and there is information that the CBO released concerning updated estimates for the insurance coverage provisions of the ACA on 1/15/15. These two publications are:
Congressional Budget Office’s, “Monthly Budget Review for January 2015,” 2/6/15, https://www.cbo.gov/publication/49924, (CBO, 2/16/15).
Congressional Budget Office’s January of 2015, “Updated Estimates of the Insurance Coverage Provisions of the Affordable Care Act,” http://www.cbo.gov/sites/default/files/cbofiles/attachments/49892-breakout-AppendixB.pdf as (CBO, 1/15/15, page_).
Conservative Stephen Moore argues that our federal government is NOT meeting fiscal targets for the insurance coverage only provisions of Obamacare and Jonathan Chait is arguing that the federal government IS meeting fiscal targets for the insurance coverage only provisions of Obamacare.
Getting Personal: Right away, we know that Jonathan Chait is angry. In his title he refers to Stephen Moore as a “Guy who gets paid to say Obamacare doesn’t work” and accuses him of not having a “…single true fact to support his case.” That’s angry and the source of Mr. Chait’s anger is unclear. But Jonathan Chait indulges his anger in a variety of ways in his article.
Mr. Chait is relentless in his efforts to discredit Mr. Moore’s argument as incoherent, accusing him of not understanding, accusing Moore of concluding the complete opposite of reality, making fun of his writing, “…it is not even an English sentence,” (and that from a writer who includes the phrase True Fact in his title as Chait does), and claiming that Mr. Moore’s claims are untrue.
Does the anger and dislike help us better understand the liberal, Mr. Chait’s article that could conceivably lead us to see him as a guy who gets paid to say Obamacare works? Yes, because the decision to be automatically opposed to Stephen Moore prevents Mr. Chait from being able to acknowledge where Stephen Moore might have gotten things correct, or raised a valid issue. Arguably, Mr. Moore is unable to see beyond his own bias as well.
THE BUDGET DEFICIT: Jonathan Chait begins with Stephen Moore’s assertion that Obamacare was supposed to “…reduce the budget deficit,” (Moore), noting that the “CBO stopped issuing cost estimates of the overall law,” (Chait), as explained in Part I of this series.
I do not excuse Mr. Moore’s manipulation of language here but let’s at least acknowledge that when it comes to “spinning” Obamacare liberals give as good as they get.
Is Mr. Moore’s statement regarding the deficit and Obamacare truthful? Not really. Here’s why: The federal deficit is defined as the AMOUNT EACH YEAR that federal outlays (payments) EXCEED federal RECEIPTS.
When Mr. Moore asserts that Obamacare INCREASES the federal deficit, therefore, based on the CBO’s 2/6/15 “Monthly Budget Review,” he’s not really conveying the information that the CBO provided which is, “Revenues and outlays were both 8 percent higher than they were at this time a year ago,” and that “If lawmakers enact no further legislation affecting spending or revenues, the federal government will end fiscal year 2015 with a deficit of $468 billion, or 2.6 percent of gross domestic product (GDP), CBO estimates, down from a deficit of $483 billion, or 2.8 percent of GDP, in 2014,” (CBO, 2/6/15) That’s DOWN FROM THE DEFICIT IN 2014.
But since our government is operating at a deficit, as an expense, an outlay, Obamacare contributes to that deficit. Therefore, since all outlays contribute to the deficit and Obamacare is an outlay, then Obamacare contributes to the deficit.
GETTING PERSONAL: Mr. Chait’s anger prevents him from seeing that lines after he criticizes Mr. Moore for using the limited information from the CBO to support his argument about Obamacare increasing the deficit he makes the very same assumption, that without full information there can be a conclusion as to whether fiscal spending is meeting, lower than or exceeding targets.
Mr. Chait even inserts a “happy graph” to support his spin that somehow, still not knowing the full budgetary impact of Obamacare that he can imply that Obamacare is costing the government less than anticipated by inserting a chart that only shows that outlays for direct spending on coverage are lower (naturally omitting any other budgetary impacts which the CBO acknowledges there are but that can’t be determined).
Mr. Chait’s assertion has even less connection to truth regarding the deficit because whereas Mr. Moore could “spin” his assertion about the deficit to say, “Since all outlays contribute to the deficit and Obamacare is an outlay, therefore Obamacare contributes to the deficit,” Mr. Chait cannot say that “Since all outlays contribute to the deficit and Obamacare has lower outlays than predicted that it doesn’t contribute to the deficit.” This is nonsense.
Mr. Chait has to resort to arguing that the outlays by the federal government for direct coverage spending are lower than they were,” but that is largely meaningless without knowing what other shifts in the budget reflect increased or decreased spending from Obamacare.
All we know from Mr. Moore’s assertion and Mr. Chait’s response is that even though Obamacare costs the federal government money, the amount of that money that the federal government is spending on Obamacare from direct coverage spending only is down so far.
Must we give up our issue: IS THE GOVERNMENT ACHIEVING ITS FISCAL TARGETS FOR DIRECT HEALTH INSURANCE COVERAGE EXPENSES WITH RESPECT TO HEALTHCARE SPENDING UNDER THE AFFORDABLE CARE ACT? Not yet.
Gross generalizations, even those using the happy chart are not useful because we cannot determine all the budgetary impacts from the ACA. But it is useful to see whether the specific components of federal healthcare coverage expenses as considered by the CBO are on target in terms of the expectations of Obamacare in order for us to determine whether we can rely on the projections from the CBO.
Therefore, our issue is: IS THE GOVERNMENT ACHIEVING ITS FISCAL TARGETS FOR DIRECT HEALTH INSURANCE COVERAGE EXPENSES WITH RESPECT TO A COMPARISON OF CBO PROJECTIONS TO EXPERIENCE SO THAT WE CAN RELYON CBO PROJECTIONS MOVING FORWARD?
Next we’ll consider: CBO’s Projections and Obamacare: What they really tell us, Part III of, “Obamacare and Healthcare SPENDING: Chait v. Moore.”
1-“Guy Who Gets Paid to Say Obamacare Doesn’t Work Can’t Find a Single True Fact to Support His Case,” Jonathan Chait, NEW YORK MAGAZINE 2/18/15 article, http://nymag.com/daily/intelligencer/2015/02/obamacare-hater-cant-find-single-true-fact.html, (Chait).
2-“Affordable care that isn’t affordable: Despite the President’s promises, health care costs are going up,” Stephen Moore, THE WASHINGTON TIMES, 2/15/15, http://www.washingtontimes.com/news/2015/feb/15/stephen-moore-affordable-care-act-isnt-affordable/, (Moore).
In Part I, Chait v. Moore and Obamacare Healthcare Spending, I concluded that neither Jonathan Chait nor Stephen Moore could know for certain the overall budgetary impacts of Obamacare so far because the government itself doesn’t know according to the Congressional Budget Office’s 1/15/15 publication, “Updated Estimates of the Insurance Coverage Provisions of the Affordable Care Act,” cited hereafter as (CBO, 1/15/15, page _), “Obamacare and Healthcare SPENDING: Chait v. Moore Part I,” 2/21/15.
Can we address the issue, “IS THE GOVERNMENT ACHIEVING ITS FISCAL TARGETS FOR SAVING MONEY ON HEALTHCARE SPENDING WITH THE AFFORDABLE CARE ACT?” Not really.
But can we address the issue: IS THE GOVERNMENT ACHIEVING ITS FISCAL TARGETS FOR DIRECT HEALTH INSURANCE COVERAGE EXPENSES WITH RESPECT TO HEALTHCARE SPENDING UNDER THE AFFORDABLE CARE ACT? Not the way Jonathan Chait or Stephen Moore would have us do it.
There is information provided by the CBO providing budget review information released 2/6/15 for January for four months of this fiscal year and there is information that the CBO released concerning updated estimates for the insurance coverage provisions of the ACA on 1/15/15. These two publications are:
Congressional Budget Office’s, “Monthly Budget Review for January 2015,” 2/6/15, https://www.cbo.gov/publication/49924, (CBO, 2/16/15).
Congressional Budget Office’s January of 2015, “Updated Estimates of the Insurance Coverage Provisions of the Affordable Care Act,” http://www.cbo.gov/sites/default/files/cbofiles/attachments/49892-breakout-AppendixB.pdf as (CBO, 1/15/15, page_).
Conservative Stephen Moore argues that our federal government is NOT meeting fiscal targets for the insurance coverage only provisions of Obamacare and Jonathan Chait is arguing that the federal government IS meeting fiscal targets for the insurance coverage only provisions of Obamacare.
Getting Personal: Right away, we know that Jonathan Chait is angry. In his title he refers to Stephen Moore as a “Guy who gets paid to say Obamacare doesn’t work” and accuses him of not having a “…single true fact to support his case.” That’s angry and the source of Mr. Chait’s anger is unclear. But Jonathan Chait indulges his anger in a variety of ways in his article.
Mr. Chait is relentless in his efforts to discredit Mr. Moore’s argument as incoherent, accusing him of not understanding, accusing Moore of concluding the complete opposite of reality, making fun of his writing, “…it is not even an English sentence,” (and that from a writer who includes the phrase True Fact in his title as Chait does), and claiming that Mr. Moore’s claims are untrue.
Does the anger and dislike help us better understand the liberal, Mr. Chait’s article that could conceivably lead us to see him as a guy who gets paid to say Obamacare works? Yes, because the decision to be automatically opposed to Stephen Moore prevents Mr. Chait from being able to acknowledge where Stephen Moore might have gotten things correct, or raised a valid issue. Arguably, Mr. Moore is unable to see beyond his own bias as well.
THE BUDGET DEFICIT: Jonathan Chait begins with Stephen Moore’s assertion that Obamacare was supposed to “…reduce the budget deficit,” (Moore), noting that the “CBO stopped issuing cost estimates of the overall law,” (Chait), as explained in Part I of this series.
I do not excuse Mr. Moore’s manipulation of language here but let’s at least acknowledge that when it comes to “spinning” Obamacare liberals give as good as they get.
Is Mr. Moore’s statement regarding the deficit and Obamacare truthful? Not really. Here’s why: The federal deficit is defined as the AMOUNT EACH YEAR that federal outlays (payments) EXCEED federal RECEIPTS.
When Mr. Moore asserts that Obamacare INCREASES the federal deficit, therefore, based on the CBO’s 2/6/15 “Monthly Budget Review,” he’s not really conveying the information that the CBO provided which is, “Revenues and outlays were both 8 percent higher than they were at this time a year ago,” and that “If lawmakers enact no further legislation affecting spending or revenues, the federal government will end fiscal year 2015 with a deficit of $468 billion, or 2.6 percent of gross domestic product (GDP), CBO estimates, down from a deficit of $483 billion, or 2.8 percent of GDP, in 2014,” (CBO, 2/6/15) That’s DOWN FROM THE DEFICIT IN 2014.
But since our government is operating at a deficit, as an expense, an outlay, Obamacare contributes to that deficit. Therefore, since all outlays contribute to the deficit and Obamacare is an outlay, then Obamacare contributes to the deficit.
GETTING PERSONAL: Mr. Chait’s anger prevents him from seeing that lines after he criticizes Mr. Moore for using the limited information from the CBO to support his argument about Obamacare increasing the deficit he makes the very same assumption, that without full information there can be a conclusion as to whether fiscal spending is meeting, lower than or exceeding targets.
Mr. Chait even inserts a “happy graph” to support his spin that somehow, still not knowing the full budgetary impact of Obamacare that he can imply that Obamacare is costing the government less than anticipated by inserting a chart that only shows that outlays for direct spending on coverage are lower (naturally omitting any other budgetary impacts which the CBO acknowledges there are but that can’t be determined).
Mr. Chait’s assertion has even less connection to truth regarding the deficit because whereas Mr. Moore could “spin” his assertion about the deficit to say, “Since all outlays contribute to the deficit and Obamacare is an outlay, therefore Obamacare contributes to the deficit,” Mr. Chait cannot say that “Since all outlays contribute to the deficit and Obamacare has lower outlays than predicted that it doesn’t contribute to the deficit.” This is nonsense.
Mr. Chait has to resort to arguing that the outlays by the federal government for direct coverage spending are lower than they were,” but that is largely meaningless without knowing what other shifts in the budget reflect increased or decreased spending from Obamacare.
All we know from Mr. Moore’s assertion and Mr. Chait’s response is that even though Obamacare costs the federal government money, the amount of that money that the federal government is spending on Obamacare from direct coverage spending only is down so far.
Must we give up our issue: IS THE GOVERNMENT ACHIEVING ITS FISCAL TARGETS FOR DIRECT HEALTH INSURANCE COVERAGE EXPENSES WITH RESPECT TO HEALTHCARE SPENDING UNDER THE AFFORDABLE CARE ACT? Not yet.
Gross generalizations, even those using the happy chart are not useful because we cannot determine all the budgetary impacts from the ACA. But it is useful to see whether the specific components of federal healthcare coverage expenses as considered by the CBO are on target in terms of the expectations of Obamacare in order for us to determine whether we can rely on the projections from the CBO.
Therefore, our issue is: IS THE GOVERNMENT ACHIEVING ITS FISCAL TARGETS FOR DIRECT HEALTH INSURANCE COVERAGE EXPENSES WITH RESPECT TO A COMPARISON OF CBO PROJECTIONS TO EXPERIENCE SO THAT WE CAN RELYON CBO PROJECTIONS MOVING FORWARD?
Next we’ll consider: CBO’s Projections and Obamacare: What they really tell us, Part III of, “Obamacare and Healthcare SPENDING: Chait v. Moore.”
Obamacare and Healthcare SPENDING: Chait v. Moore PART I
Originally I had the message of Obamacare backwards. Based on what I was informed about from the media to the President, I thought Obamacare was supposed to protect consumer patients AND would do it while saving the government money on healthcare spending.
But I was wrong, the priorities were exactly the opposite, to save the government money on healthcare spending and hopefully get consumer buy-in by introducing some “patient protections,” under the Patient Protection and Affordable Care Act.
If from the beginning I’d been informed that the PPACA was at best an Affordable Care (for Government) and Maybe A Patient Protection Act, a law to reduce government healthcare spending, then I would have EXPECTED that the first priority would have precedence over the second so that when I DID NOT save $2,500 a year, when I DID NOT gain protection from financial ruin in the event of illness, when I did NOT get the choice to keep my old plan, when I did NOT find myself better off financially but rather worse off, well, then, MAYBE, if the government was still saving money on healthcare spending, then perhaps I could have still considered the law a success.
That’s the issue in the two articles discussed below, IS THE GOVERNMENT ACHIEVING ITS FISCAL TARGETS FOR SAVING MONEY ON HEALTHCARE SPENDING WITH THE AFFORDABLE CARE ACT?
1-“Guy Who Gets Paid to Say Obamacare Doesn’t Work Can’t Find a Single True Fact to Support His Case,” Jonathan Chait, NEW YORK MAGAZINE 2/18/15 article, http://nymag.com/daily/intelligencer/2015/02/obamacare-hater-cant-find-single-true-fact.html, (Chait).
2-“Affordable care that isn’t affordable: Despite the President’s promises, health care costs are going up,” Stephen Moore, THE WASHINGTON TIMES, 2/15/15, http://www.washingtontimes.com/news/2015/feb/15/stephen-moore-affordable-care-act-isnt-affordable/, (Moore).
Spoiler alert. WE DON’T KNOW WHETHER OBAMACARE IS SAVING THE GOVERNMENT MONEY OVERALL OR NOT BECAUSE THE GOVERNMENT DOESN’T KNOW. But it doesn’t stop these two guys from making claims that THEY know, which is not true.
Here’s why: While there is information from the Congressional Budget Office concerning the insurance coverage budgetary impact for the federal government attributable to the ACA, the Congressional Budget Office states in its 1/15/15 report cited below that “…estimates address only the insurance coverage provisions of the ACA and do not reflect all of the act’s budgetary effects…because the provisions of the ACA that do not relate directly to health insurance coverage generally modified existing federal programs (such as Medicare) or made various changes to the tax code, determining what would have happened since the enactment of the ACA had the law not been in effect is becoming increasingly difficult,” Congressional Budget Office’s January of 2015, “Updated Estimates of the Insurance Coverage Provisions of the Affordable Care Act,” http://www.cbo.gov/sites/default/files/cbofiles/attachments/49892-breakout-AppendixB.pdf, page 1.
This is important. The Congressional Budget Office states that it can’t “…produce estimates of the budgetary effects of the ACA as a whole as part of the baseline process,”…but can only produce comparisons of what government expenses are from the NEWLY established programs, (CBO, 1/15/15, page 1).
This makes sense, you can only compare what you thought expenses would be and what they are regarding expenses that are created by the Affordable Care Act because in established programs, like Medicare, determining which part of the expenses are attributable to the Affordable Care Act and which aren’t is difficult. The conclusion for the CBO: “As a result, CBO does not produce estimates of the budgetary effects of the ACA as a whole as part of the baseline process,” (CBO, 1/15/15).
So, for today, let’s give both authors a reprimand: You cannot determine whether Obamacare is achieving government savings goals overall because its budgetary impacts are broader than direct insurance coverage provisions and these broader impacts cannot be determined by the government so you cannot determine them either.
Next, we’ll proceed to: “MAKING IT PERSONAL,” Part II of, “Obamacare and Healthcare SPENDING: Chait v. Moore.”
But I was wrong, the priorities were exactly the opposite, to save the government money on healthcare spending and hopefully get consumer buy-in by introducing some “patient protections,” under the Patient Protection and Affordable Care Act.
If from the beginning I’d been informed that the PPACA was at best an Affordable Care (for Government) and Maybe A Patient Protection Act, a law to reduce government healthcare spending, then I would have EXPECTED that the first priority would have precedence over the second so that when I DID NOT save $2,500 a year, when I DID NOT gain protection from financial ruin in the event of illness, when I did NOT get the choice to keep my old plan, when I did NOT find myself better off financially but rather worse off, well, then, MAYBE, if the government was still saving money on healthcare spending, then perhaps I could have still considered the law a success.
That’s the issue in the two articles discussed below, IS THE GOVERNMENT ACHIEVING ITS FISCAL TARGETS FOR SAVING MONEY ON HEALTHCARE SPENDING WITH THE AFFORDABLE CARE ACT?
1-“Guy Who Gets Paid to Say Obamacare Doesn’t Work Can’t Find a Single True Fact to Support His Case,” Jonathan Chait, NEW YORK MAGAZINE 2/18/15 article, http://nymag.com/daily/intelligencer/2015/02/obamacare-hater-cant-find-single-true-fact.html, (Chait).
2-“Affordable care that isn’t affordable: Despite the President’s promises, health care costs are going up,” Stephen Moore, THE WASHINGTON TIMES, 2/15/15, http://www.washingtontimes.com/news/2015/feb/15/stephen-moore-affordable-care-act-isnt-affordable/, (Moore).
Spoiler alert. WE DON’T KNOW WHETHER OBAMACARE IS SAVING THE GOVERNMENT MONEY OVERALL OR NOT BECAUSE THE GOVERNMENT DOESN’T KNOW. But it doesn’t stop these two guys from making claims that THEY know, which is not true.
Here’s why: While there is information from the Congressional Budget Office concerning the insurance coverage budgetary impact for the federal government attributable to the ACA, the Congressional Budget Office states in its 1/15/15 report cited below that “…estimates address only the insurance coverage provisions of the ACA and do not reflect all of the act’s budgetary effects…because the provisions of the ACA that do not relate directly to health insurance coverage generally modified existing federal programs (such as Medicare) or made various changes to the tax code, determining what would have happened since the enactment of the ACA had the law not been in effect is becoming increasingly difficult,” Congressional Budget Office’s January of 2015, “Updated Estimates of the Insurance Coverage Provisions of the Affordable Care Act,” http://www.cbo.gov/sites/default/files/cbofiles/attachments/49892-breakout-AppendixB.pdf, page 1.
This is important. The Congressional Budget Office states that it can’t “…produce estimates of the budgetary effects of the ACA as a whole as part of the baseline process,”…but can only produce comparisons of what government expenses are from the NEWLY established programs, (CBO, 1/15/15, page 1).
This makes sense, you can only compare what you thought expenses would be and what they are regarding expenses that are created by the Affordable Care Act because in established programs, like Medicare, determining which part of the expenses are attributable to the Affordable Care Act and which aren’t is difficult. The conclusion for the CBO: “As a result, CBO does not produce estimates of the budgetary effects of the ACA as a whole as part of the baseline process,” (CBO, 1/15/15).
So, for today, let’s give both authors a reprimand: You cannot determine whether Obamacare is achieving government savings goals overall because its budgetary impacts are broader than direct insurance coverage provisions and these broader impacts cannot be determined by the government so you cannot determine them either.
Next, we’ll proceed to: “MAKING IT PERSONAL,” Part II of, “Obamacare and Healthcare SPENDING: Chait v. Moore.”
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