That was my response to a comment from talk radio host Brian Wilson, about 14 minutes into this podcast, on the White House’s Snitch Project. Of course, the conversation leading up to that is well worth 14 minutes.
Cato at Liberty
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Health Care
The Boston Globe Misleads Readers About the Cost of Health Reform in Massachusetts
An editorial in today’s Boston Globe announces, “Mass. bashers take note: Health reform is working.” The editors write:
Pundits and politicians who oppose universal healthcare for the nation have a new straw man to kick around — the Massachusetts reform plan that covers more than 97 percent of the state’s residents. In the myth that these critics have manufactured, this state’s plan is bleeding taxpayers dry, creating nothing less than a medical Big Dig.
The facts — according to the Massachusetts Taxpayers Foundation — are quite different. Its report this spring put the cost to the state taxpayer at about $88 million a year, less than four-tenths of 1 percent of the state budget of $27 billion.
Here’s why the claim that the reforms cost Massachusetts taxpayers just $88 million per year is wrong.
- According to the Massachusetts Taxpayers Foundation, $88 million is not the annual cost of the law, but the average year-to-year increase in state spending due to the law. It’s a marginal-cost estimate, not a total-cost estimate.
- The foundation used (uncertain) future spending cuts to make the average annual increase in spending appear smaller. In 2009, the total cost to the state government, according to the foundation, will be $408 million, nearly five times what the Globe claims.
- That $408 million is just the cost to the state government. According to the foundation’s estimates, the state government’s share amounts to just 20 percent of the law’s total cost of $2.1 billion in 2009. The remaining 80 percent is borne by the federal government (20 percent) and private individuals and employers complying with the law’s individual and employer mandates (60 percent). Since Massachusetts taxpayers also pay federal taxes and must comply with the law’s mandates, state taxpayers pay much more than $88 million to comply with the law. In fact, the total cost of the law is about 24 times what the Globe says it is.
So the Globe is wrong. But here’s why the Globe should have known better.
I recently wrote an op-ed where I picked apart the Massachusetts Taxpayers Foundation numbers. The op-ed hardly “manufactured myths” or “kicked around straw men.” I reached these conclusions using the foundation’s own data, and by talking with foundation president Michael Widmer. Widmer agrees with all of these points. (With one exception: he maintains it’s legitimate to use assumed future savings to reduce the average year-to-year increase in spending. But really, that’s a minor issue.)
I submitted that op-ed to The Boston Globe. They sat on it for a week, then rejected it. Which is fine. (FYI, the op-ed has been accepted at The Providence Journal.)
At a minimum, that raises the question of whether this misinformation was in fact disinformation.
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On Health Reform, Massachusetts Is the Model
Last week, former Massachusetts governor Mitt Romney (R) penned a wonderfully misleading oped for USA Today. In response, I submitted this poor, unsuccessful letter to the editor:
If Massachusetts were covering the uninsured for less than $800 a pop, as former Gov. Mitt Romney suggests [“Mr. President, What’s the Rush?”, July 30], then the health reforms he signed in 2006 would truly be a model for the nation. Yet data from the very watchdog organization Romney cites (the Massachusetts Taxpayers Foundation) indicate something different.
The Massachusetts reforms cost more than five times what Romney claims, because the state pushed more than 80 percent of the cost off-budget, and onto private individuals and the federal government. In fact, “RomneyCare” covers a family of four at a cost of at least $27,000 – more than twice the average cost of employer-sponsored coverage ($12,680).
Romney is correct that President Barack Obama has the wrong prescription for health reform. But that’s because Obama’s approach is Romney’s approach. Like Romney, Obama would have government force people to purchase health insurance; control the content, terms, and price of “private” health insurance policies; expand Medicaid; and create new government subsidies and bureaucracies. Like Romney, Obama would push most of the cost off-budget by imposing mandates on states and private individuals – which constitutes a huge tax increase on the middle class.
ObamaCare, like RomneyCare, is socialized medicine with a private façade.
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“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 needs…health 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.”
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Another Reason We Don’t Want Government Rationing Health Care
Although “rationing” of health care, like any scarce resource, is inevitable, there are a lot of good reasons for not allowing government to decide who gets what. First among them is the fact that individuals have a basic right to make basic life choices themselves.
Moreover, irrespective of the rhetoric of self-interested politicians seeking votes, government does not have the interest of patients first and foremost in mind. Indeed, in Great Britain the primary interest of the National Health Service these days appears to be saving money by reducing care.
The Government’s drug rationing watchdog says “therapeutic” injections of steroids, such as cortisone, which are used to reduce inflammation, should no longer be offered to patients suffering from persistent lower back pain when the cause is not known.
Instead the National Institute of Health and Clinical Excellence (NICE) is ordering doctors to offer patients remedies like acupuncture and osteopathy.
Specialists fear tens of thousands of people, mainly the elderly and frail, will be left to suffer excruciating levels of pain or pay as much as £500 each for private treatment.
The NHS currently issues more than 60,000 treatments of steroid injections every year. NICE said in its guidance it wants to cut this to just 3,000 treatments a year, a move which would save the NHS £33 million.
But the British Pain Society, which represents specialists in the field, has written to NICE calling for the guidelines to be withdrawn after its members warned that they would lead to many patients having to undergo unnecessary and high-risk spinal surgery.
Somehow this doesn’t look like the sort of “change” most Americans were voting for last November.
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A Right to Health Care?
Rep. John Conyers believes that health care should be a constitutional right. That sounds good, but what does that mean? A right to the level of care provided by Great Britain’s National Health System? Or to treatment in the finest hospitals and by the best specialists available in America? And who must provide for this “right”?
Theodore Dalrymple explains why calling health care a right is a bad idea:
If there is a right to health care, someone has the duty to provide it. Inevitably, that “someone” is the government. Concrete benefits in pursuance of abstract rights, however, can be provided by the government only by constant coercion.
People sometimes argue in favor of a universal human right to health care by saying that health care is different from all other human goods or products. It is supposedly an important precondition of life itself. This is wrong: There are several other, much more important preconditions of human existence, such as food, shelter and clothing.
Everyone agrees that hunger is a bad thing (as is overeating), but few suppose there is a right to a healthy, balanced diet, or that if there was, the federal government would be the best at providing and distributing it to each and every American.
Where does the right to health care come from? Did it exist in, say, 250 B.C., or in A.D. 1750? If it did, how was it that our ancestors, who were no less intelligent than we, failed completely to notice it?
Americans have a right to seek medical treatment of whatever kind they wish and to make treatment choices for themselves. Good and generous people should help ensure that their less fortunate neighbors receive necessary medical care. But no one has a “right” to force unspecified people to provide them with unspecified care. Even if they did, they wouldn’t want to rely on the government to filfull that right.
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Barney Frank, on the Road to Socialized Medicine
More evidence, in case you needed it, that a new “Fannie Med” is designed to suck all Americans into a single government-run system: