August 5, 2009 9:36AM

“Ad Audit” Audit

Kaiser Health News has launched a new "Ad Audit" series that critiques the TV ads that various groups are airing both to promote or hinder the health care reforms moving through Congress.  KHN correspondent Jordan Rau makes two solid contributions to the series.  Two other audits leave something to be desired, however, while a fifth audit is just...well, you decide.

One lackluster audit examines an ad by the health-insurance lobby, AHIP.  KHN dings AHIP for making bland statements in support of "bipartisan reforms" and "universal coverage" without offering "policy specifics about what these statements mean."  But the AHIP ad does make two policy statements that are susceptible to analysis:

If everyone’s covered, we can make health care as affordable as possible. And the words "pre-existing condition" become a thing of the past.

How is covering everybody supposed to make health care more affordable?  Might there be a downside to requiring insurers to cover pre-existing conditions?  KHN provides no analysis of the former statement.  And rather than analyze the latter, KHN offers a spat between a left-leaning analyst and an AHIP lobbyist (I suppose that's considered a balanced discussion) over whether AHIP's proposed price controls go far enough.

Another lackluster audit examines an ad by Healthy Economy Now, a coalition comprised of "the Pharmaceutical Research and Manufacturers of America (PhRMA), AARP, the American Medical Association, the Advanced Medical Technology Association, Business Roundtable, Families USA and the Service Employees International Union."  This ad also provides fertile ground for analysis:

If we don't act, medical bills will wipe out their savings...she'll be denied coverage because of a pre-existing condition and he won't get the chemotherapy he care costs will rise 70 percent...But we can act. The president and Congress have a plan to lower your costs and stop denials for pre-existing conditions.

Medical bills are wiping out many people's savings -- but would the Democrats' legislation put an end to that?  Again, are there any trade-offs involved in forcing insurers to cover pre-existing conditions?  Might insurers stint on things like chemo because that would spur cancer patients to switch to other insurers (where they would bring down the competition's bottom line)?  Would health care costs grow more or less rapidly under the Democrats' reforms?  What does the Congressional Budget Office have to say?  In place of such useful analysis, KHN merely reports that the ads are meant to influence the Blue Dogs, who had been holding up the Democrats' health plans.  (Of course, that in itself is interesting: why are these disparate groups so unified in their desire to see the Democrats' reforms enacted?  It's a wonderful opportunity to test out the "bootleggers and Baptists" theory of regulation.  But KHN...not interested.)

Yet the worst "audit" has to be KHN's treatment of an ad by the group Conservatives for Patients' Rights.  KHN provides all the reasons that people should be suspicious of the ad and its sponsors: CPR was founded by a rich guy, who was ousted from his former gig as a hospital CEO amid fraud investigations, and who hired the "Swift Boat" crew to do his PR.  Fair enough.

KHN goes off the rails, however, when it critiques the ad's content.  The ad states:

Some of Congress' health care plans could squeeze you four ways. It could raise taxes by $600 billion—even taxing soda. It could add a trillion to the federal deficit. New rules could hike your health insurance premiums 95 percent. You still might end up on their government-run health plan.

KHN reports, "the facts are largely taken out of context, come from biased industry groups or have been discredited."

KHN quotes the Urban Institute's John Holahan as saying, "There's absolutely nothing here that's right. It's unbelievable."  But regarding the $600-billion figure, KHN then writes, "Holahan says that number could turn out to be right, but it likely will be less."  Well, which is it?  CPR says the tax hike could reach $600 billion.  Holahan says it could, too.  So how is it that CPR's claim is absolutely, unbelievably not right?  How could KHN not notice that contradiction?

"And," KHN ads, "a soda tax is just one of many proposed revenue-raisers, including a cap on the tax deductibility of insurance premiums, a tax on the wealthy and an alcohol tax." So what?  Does that make the soda-tax claim untrue?  Or even misleading?

KHN then challenges CPR's "could add a trillion to the federal deficit" claim again by quoting Holahan:

It's almost impossible to both say that you're going to raise taxes by $600 billion and increase the deficit by $1 trillion—that means there's no savings at all anywhere. That can't be right.

First, that's not what the ad claims.  The ad claims only that either could happen.  Second, given the difficulties that Democrats are having in paying for their reforms, and the tendency of government health programs to exceed spending projections, it's not that unreasonable to think that both could happen.

Regarding the "could hike your health insurance premiums 95 percent" claim, KHN quotes Holahan as saying, "premiums are 'almost guaranteed' to grow 95% over a 10 year period" anyway.  CPR's claim has to do with the effects of imposing price controls on health insurance premiums (i.e., banning exclusions for pre-existing conditions), which would increase premiums for the healthy.  Holahan does not refute CPR's claim so much as confuse that effect with overall premium growth.  In fact, price controls could very well increase healthy people's premiums by 95 percent, and then overall premium growth could cause those premiums to rise another 95 percent over the next 10 years.

This is getting exhausting, so I'll wrap up by noting that KHN's refutation of CPR's "You still might end up on their government-run health plan" claim was also a non-refutation.  After insinuating that the Lewin study CPR cites is either biased, discredited, or both, KHN merely notes that the study produced multiple estimates of how many Americans would end up in a new government program.  Oh, and different ways of creating a new program will influence that number.  Well, no duh.  And how on Earth does that impugn CPR's claim?

KHN was not the only one asleep at the switch here.  My friend Jonathan Cohn also missed the contradictions, shell games, and non sequiturs in this audit when he uncritically blogged about it over at The New Republic.

To sum up the situation, I can't improve on Cohn's closing line: "Sadly, it's pretty typical of what we'll be seeing and hearing...over the next few weeks."