The Report the Louisiana Department of Health Doesn’t Want You to Read

In recent months, enrollment in Louisiana’s Medicaid expansion has declined, as the state finally removed tens of thousands of ineligible individuals from the rolls. But according to researchers at LSU, enrollment in expansion will soon climb higher, with an estimated 41,575 individuals joining Medicaid expansion in 2019 alone.

Those estimates came in a report the Louisiana Department of Health (LDH), using state and federal taxpayer dollars, commissioned from LSU. The circumstances surrounding this report raise concerns and questions in at least two areas. First, someone—it remains unclear whether from LDH, LSU or both—deleted important passages from the report during the editing process. And second, the report appears nowhere on LDH’s website.

Despite the Pelican Institute first requesting documents surrounding this enrollment study on June 10, LDH has yet to turn over a single document on the report. However, through a public records request of LSU, the Pelican Institute managed to obtain a version of the report from June 2019 and a version dated August 2019, which LSU presented as the final document.

In many sections, August’s final enrollment report contains the same verbatim passages as the June version. However, the August version eliminated all discussion of projected Medicaid enrollment in future years. As a result, LSU removed major sections of the June version—three paragraphs of the executive summary, population projections on pages 11-13, and Medicaid enrollment projections on pages 14-20—from August’s final report.

With respect to Medicaid expansion, the June version of the report projects substantial enrollment increases. From a level of 470,567 in 2018, the LSU researchers project enrollment in Medicaid expansion to jump to 512,142 in 2019—an increase of 8.8% in one year alone—and climb slowly thereafter, reaching 515,721 in 2022.

Moreover, the June report acknowledges that expansion enrollment “can become substantially higher given that the ceiling” for enrollment “is over 571,000” by 2022—and even this “ceiling” for enrollment represents an under-estimate, the researchers admit. Because the researchers’ ceiling only includes individuals with income below the poverty level, but most individuals with income below 138% of the poverty level qualify for Medicaid expansion, enrollment could exceed even the 571,000 maximum outlined by the researchers.

Overall, the June report shows a dramatic growth in Medicaid dependence over the span of a decade. According to the LSU researchers, “by 2022, Medicaid enrollees will represent about 36% of the population, compared to 24% in 2012.”

The enrollment projections removed from August’s final version of the enrollment report raise serious questions, including:

  • How is LSU’s projected increase in Medicaid expansion for 2019 enrollment consistent with the eligibility checks LDH instituted earlier this year?
  • Why did the LSU researchers agree to release such a heavily redacted version of their work? Were there any political motivations in the decision?
  • Given that LSU presented its report as final, why has LDH declined to publish any version of the report on its website? Similarly, why has LDH declined to disclose any documents regarding this report in response to the Pelican Institute’s public records requests?
  • The contract governing the enrollment report specifically required LSU to draft “a report to LDH providing the projections of Medicaid recipients based on a prepared model for projecting Medicaid recipients by major categories.” Why did the Department of Health agree to spend a total of $71,120 of state and federal taxpayer dollars on an enrollment report—only to have that report fail to meet the Department’s stated objectives? Will officials within LDH repay taxpayers for the funds spent on a report that does not meet the Department’s own objectives?

The residents of Louisiana deserve the truth about Medicaid expansion. The mysterious circumstances surrounding this enrollment report—the deletions from the final report, LDH’s failure to post the report publicly and its failure to provide documents in response to the Pelican Institute’s records requests—should lead citizens and lawmakers to demand greater transparency and accountability from LDH. Taxpayers deserve to know exactly how their dollars are being spent.

This post was originally published by the Pelican Institute.

Junk “Study” Demonstrates Liberal Think-Tank’s Bias

Why would an organization billed as a “respected source of health care data” publish an analysis with mutually contradictory conclusions? In the case of the Kaiser Family Foundation, the answer is simple: To defend Obamacare—even if the facts don’t align with one’s conclusions.

As conservatives have noted for years, Obamacare encourages states to discriminate against individuals with disabilities—a prime example of how government intervention in the health care system ultimately hurts those the left claims they want to help. Liberals, understanding the political power of such charges, feel compelled to push back on this narrative. While they don’t have many actual facts with which to do so, that hasn’t stood in the Kaiser Family Foundation’s way.

Obamacare’s Discrimination, Explained

If you could gain 50-76 cents for doing one thing, and 90 cents for doing another, which would you choose? I know which I would.

When I served on the Commission on Long-Term Care in 2013, it explored an area of health policy unknown to much of the public: Hundreds of thousands of individuals with disabilities remain on Medicaid waiting lists for home and community-based care. While federal law requires state taxpayers to pay nursing home benefits for all eligible Medicaid patients, coverage of community-based services remains optional, so states can—and do—establish waiting lists to control their Medicaid spending.

These waiting lists preceded Obamacare, so Obamacare didn’t cause the waiting lists per se. And individuals with disabilities on the waiting lists do have their health care needs paid for by Medicaid, even as they wait to become eligible for home-based care (e.g., help with bathing, dressing, etc.). But sheer common sense indicates that states will prioritize coverage of able-bodied adults—for which they get paid a higher match from the federal government—than eliminating their waiting list for individuals with disabilities.

The Flawed Premise

For the past several years, Kaiser has attempted to rebut charges that Medicaid expansion has affected waiting lists for individuals with disabilities. Their studies, including one released in April, claim that there is no relationship between whether a state has expanded Medicaid and increases or decreases in its waiting lists.

However, as I first noted two years ago, Kaiser’s over-simplistic analysis does not begin to consider the many other factors that affect decisions about their Medicaid programs and waiting lists. To use the most obvious example, the average state that has not expanded Medicaid is poorer than the average state that has. Connecticut, with a median income of $73,781 in 2017, has more resources to expand Medicaid to able-bodied adults and reduce its waiting lists than a state like Alabama, which had a median income of $46,472.

If Kaiser wanted to do a thorough analysis, it would control for this variable, and others. For instance, a good econometric analysis would factor in states’ morbidity rates—because states with sicker populations may have more individuals with disabilities needing care—along with the underlying cost of care, because states would have to spend more to reduce their waiting lists in areas with higher prices.

Contradictory Claims

How superficial are Kaiser’s conclusions? The section of its April paper right after the passage claiming no relationship between Obamacare and waiting lists includes this doozy:

Waiting lists are a function of the populations a state chooses to serve and how the state defines those populations; both of these factors vary among states, making waiting lists an incomplete measure of state capacity and demand for [home and community-based services] and not directly comparable among states. [Emphasis original.]

If waiting lists for individuals with disabilities are “not directly comparable among states,” then why did Kaiser in the preceding section claim Obamacare’s Medicaid expansion has nothing to do with waiting lists—a conclusion that by definition involves comparing waiting lists among states?

The question practically answers itself. Kaiser just hopes you won’t notice.

Talking Point versus Research

After more than two months, the researcher, Mary Beth Musumeci, would not deign to defend her “research” with a direct reply. Instead a Kaiser spokesman sent me what amounted to a polite brush-off, replicated in full below:

Thank you for your interest in our work. We appreciate people taking the time to consider our work and provide constructive feedback on it, and our team discussed your comments and ideas.

The data in the brief are presented as a simple, descriptive comparison of trends in wait lists stratified by expansion status, and we also tried to be clear about major limitations of the data, including caveats in state comparisons of wait lists. While we agree that further econometric analysis to assess causality could build on this work and contribute to policy understanding, the posted brief was not an attempt to undertake such analysis.

We appreciate your feedback and will consider it as we continue to develop our work in this area, and we hope our work serves as a useful basis for your own analysis and econometric research to undertake the type of work you suggest in your comments.

I responded with one simple question: Does the Kaiser Family Foundation have any plans to conduct an econometric study on Medicaid expansion and waiting lists? As I noted in my response:

You’ve admitted the limitations of your own analysis to date, but you’ve repeated these types of assertions for several years—without doing the type of in-depth research that you concede would be both warranted and more accurate. Why not?

Kaiser’s communications department responded that they don’t have that type of study planned. I won’t hold my breath for them to conduct this type of econometric study, either. As with the issue of pre-existing conditions, Kaiser won’t ask a question to which it doesn’t want to know the answer. Far better to use a crude and highly flawed “study” to claim that Obamacare hasn’t affected Medicaid waiting lists—the political conclusion the Kaiser analysts want to support.

A supposed “fact check” on the disability waiting list issue two years ago called the Kaiser Family Foundation a “respected source of health care data.” But by issuing mutually contradictory conclusions to maintain a political talking point, and not conducting the in-depth research that they admit the issue of Medicaid waiting lists warrants, Kaiser again reveals itself not so much as a respected source of health care data as a highly liberal one.

This post was originally published at The Federalist.

Will Single-Payer Health Care Help Ruin the Planet?

To promote his single-payer health care legislation, Democratic presidential candidate Bernie Sanders recently sent an interesting tweet: “Average cost of childbirth in the United States: $32,000. Average cost of childbirth with Medicare for All: $0.” However, the left’s general position on population growth’s effect on the climate make one wonder why Sanders and his single-payer supporters want to facilitate additional births, whether in the United States or overseas.

As one might expect, Sanders’ tweet contained several oversimplifications and mis-statements. First, his “Medicare for All” bill would actually abolish the Medicare program. Second, the 2013 report to which Sanders referred studied the charges medical providers submitted, not just for childbirth, but for all prenatal and postpartum care. While doctors and hospitals charged patients an average of $32,063 for this year’s worth of care before and after a vaginal childbirth, insurers paid far less ($18,329)—and consumers paid only $2,244 out-of-pocket.

Not one week before Sanders sent his tweet, he addressed the topic of population growth at a CNN climate forum. A member of the audience said that “human population growth has more than doubled in the past 50 years. The planet cannot sustain this growth.” In talking about “the need to curb population growth,” she asked Sanders if he would “be courageous enough to discuss this issue and make it a key feature of a plan to address climate change?” Sanders responded in the affirmative, then proceeded to highlight the need for abortion and contraception, both in the United States and overseas.

In his CNN appearance, Sanders echoed statements by other leftist leaders. In February, Rep. Alexandria Ocasio-Cortez (D-NY) asked what she considered “a legitimate question: Is it okay to still have children,” given that “there’s a scientific consensus that the lives of children are going to be very difficult?”

Following Ocasio-Cortez’ comments, Vox highlighted “a growing discussion about the ethics of having children,” due to the “a genuine concern of many young prospective parents today” about the effects of climate change. It included some questions that prospective parents have asked themselves about having children, including “how much time do I have to make a decision” to see if carbon emissions decline rapidly, and “what kinds of signals would I be sending” by making an environmental statement to eschew parenthood.

Leftists like Sanders and Ocasio-Cortez, and forums like Vox, have given voice to millennials seeking to avoid procreation, whether to hypothetically save the planet, avoid a dystopian future for their potential offspring, or a combination of the two. But few outlets on the left have reconciled their belief in the need to slow population growth to save the planet with their support for a single-payer system that—according to Sanders’ own statements—would encourage population growth by making it financially easier for parents to have children.

The conservative case against Sanders’ proposal encompasses the taxes, regulations, and government control necessary to create a single-payer health system. But liberals who claim to have a single-minded focus on the climate crisis should oppose single payer as well, due to the ecological effects that would logically follow.

This post was originally published at The Federalist.

Elizabeth Warren Has a Plan…For Avoiding Your Health Care Questions

She claims “I’ve got a plan for that” on just about every issue, but the proverbial cat got Sen. Elizabeth Warren’s tongue on health care. And you can bet that’s Warren’s plan.

Rather than answering tough questions about the single-payer health care scheme she now endorses, Warren wants to keep the focus on 1) bashing insurance companies and 2) telling people they will receive great health care under socialized medicine. Telling people they will lose their current coverage, and figuring out how to pay for this $30 trillion-plus system? Warren doesn’t want to bother answering questions about those minor details.

Subdued Launch for Elizabeth Warren’s ‘Plan’

First off, the health-care page of Warren’s website logs in at 1,115 words for a health care system on which our nation spends more than $3.5 trillion per year. By comparison, Joe Biden’s health care platform clocks in at nearly 3,302 words, or three times as long. Warren’s “plan” is 25 words longer than Donald Trump’s campaign health care platform, released in March 2016 and derided by some as having “the look and feel of something that a 22-year-old congressional staffer would write for a backbencher based on a cursory review of Wikipedia.” Yet, ironically enough, Trump’s campaign platform contained more concrete proposals than Warren’s does.

Warren’s “plan” does include specifics on prescription drug prices, mental health, the opioid epidemic, and access to care in rural communities. But on the biggest issue of the campaign—the millions of people who cannot afford health coverage because Obamacare priced them out of the marketplace, and the left’s big government “solutions” to a problem government created—Warren talks much, but says precious little.

The heart of Warren’s health care “plan” starts with two paragraphs about Warren’s life story. It continues by bashing Republicans’ attempts to “sabotage” Obamacare and insurance companies. It then states as fact that single payer “solves these problems. Everyone can see the doctor they need. Nobody goes broke.”

Apparently, the Warren campaign is looking to reduce its carbon footprint by converting to veganism. If you’re looking for any meat in this health care “plan,” good luck finding it.

Trying to Avoid History’s Mistakes

Why might Warren, who prides herself on her supposed love of wonkish details in every other issue area, suddenly become so taciturn on health care? Perhaps a video can illustrate:

Want to take a guess how many of those promises Obama’s health-care legislation actually kept? Here’s a hint: It’s a nice round number.

Therein lies the root cause of Warren’s strategy: Rather than making specific promises related to single-payer health care—which she knows she cannot possibly keep—she wants to conduct her campaign on the issue solely in platitudes. She will tell middle-class people they will pay less, but won’t say precisely how they will pay less, or who will pay more, or who qualifies as “middle class,” or how much doctors and hospitals would get hurt if (more like when) they have to take a massive pay cut under single payer.

Ironically, the lack of specifics has made some on the left leery that if and when Warren wins the Democratic nomination, she will make the proverbial “hard pivot” away from support for single payer, and water down the plan introduced by Sen. Bernie Sanders (I-VT). (Some think she hasn’t really endorsed Sanders’ plan as it is.) They do have cause for concern, given that until earlier this year, Warren had endorsed other “pathways” to get to universal coverage than a full socialized medicine scheme.

But viewed from another perspective, Warren’s silence on all the difficult (and unpopular) decisions needed to achieve a single-payer health-care system represents an implicit admission that the left cannot be upfront with the American people about all the consequences—both intended and unintended—of their agenda.

Just Tell People It’s Free

Last month, in an article about Sen. Kamala Harris’ repeated flip-flops on health care, a researcher at one liberal think-tank unironically articulated what’s going on here. Calling arguments in the Democratic debates counterproductive, the analyst said the American public “just want[s] to know the candidates’ big ideas and values. Can they shop? Is it free?”

Apart from the obvious fact that few things in life, let alone our massive health care system, come free—someone pays, in some way, shape, or form—that comment lies at the heart of Warren’s strategy: “We’re going to give you all the free stuff you want. Don’t you worry your pretty little head about the details.”

Having not been born yesterday, I will care about the details, thank you. I—and the American people—have far too much to lose.

This post was originally published at The Federalist.

Why Single-Payer Advocates Demonize Opponents of Government-Run Health Care

Earlier this summer, I wrote an article, based upon research for my forthcoming book, outlining the ways a single-payer health care system will lead to greater fraud and corruption. That afternoon, I received the following message—sent not just once, but four separate times—in my firm’s e-mail inbox:

Just finished reading the fear mongering article that Chris wrote for RCP. I am looking forward to reading and refuting his book on ‘single payer’. Id love to know which insurance companies own his arse via monetary payments. It’s obvious by Chris’ lack of salient facts regarding single payer that he is owned by some corporation. Since RCP only makes it look like others can comment you were spared from me systematically destroying your BS with the real facts of health care. In closing, go [f-ck] yourself you corporate [b-tch].

Whether in vulgar e-mails, Twitter rants, or blog posts, single payer supporters often start out by assuming that anyone opposed to socialized medicine must by definition have received some sort of payoff from drug companies or insurance companies. Even in my case, however, that claim has very little validity. More importantly, calling anyone opposed to single payer a corporate shill patronizes and insults the American people—the same people whose support they need to enact the proposal in the first place.

Take Me as an Example

If folks want to play “Gotcha” games with this nugget, they can—and some will—but there’s much less to this history than meets the eye. For starters, I took the lobbying job when I was aged 24, a little over a year out of grad school, and for the princely salary of…$39,000 per year. I never made six figures as a registered lobbyist—not even close, actually—and earned less in three and a half years as a registered lobbyist than most actual lobbyists make in one.

To be honest, I did little actual lobbying. My inclusion on the list of registered lobbyists represented more of an abundance of caution by my firm than anything else. (Under the federal Lobbying Disclosure Act, individuals do not have to register as a lobbyist if fewer than 20 percent of their hours are spent in paid lobbying activities.)

I prepared memos ahead of lobbying meetings, and drafted letters following those meetings, but precious little beyond that. After three years, I left to go back to Capitol Hill in a more senior role, where I had wanted to work all along.

More to the point: I haven’t taken a dime of support from corporate interests to shill for their positions—and I won’t, period. My views and reputation are not for sale. They’re not even for rent.

Don’t Insult the American People

Even Ezra Klein, of all people, acknowledged Americans’ deep resistance to change regarding health care. In a July article analyzing whether individuals can keep their health insurance—an issue that has tripped up Kamala Harris, among others, during the Democratic presidential campaign—Klein asked some pertinent questions:

If the private insurance market is such a nightmare, why is the public so loath to abandon it? Why have past reformers so often been punished for trying to take away what people have and replace it with something better?…

Risk aversion [in health policy] is real, and it’s dangerous. Health reformers don’t tiptoe around it because they wouldn’t prefer to imagine bigger, more ambitious plans. They tiptoe around it because they have seen its power to destroy even modest plans. There may be a better strategy than that. I hope there is. But it starts with taking the public’s fear of dramatic change seriously, not trying to deny its power.

Yet, judging from the amount of times Bernie Sanders attacks “millionaires and billionaires” in his campaign speeches, he and others find it much easier to ignore the substance of Americans’ concerns, and instead blame corporations and “the rich” for deluding the public.

Even Slate admitted that “to the President’s critics, it sounds patronizing. I was doing the right thing, but the slow American people didn’t get it” (emphasis original). Single-payer supporters fall into this trap on health care: “We could enact our socialist paradise easily, if only the health insurers and drug companies hadn’t bought off so many people.”

Starting off by questioning motives—by assuming everyone with any objections to single payer automatically must be a shill of corporate interests, just trying to bilk the sick and dying out of more money to pad their wallets—doesn’t seem like the best way to win friends and influence people, let alone pass a massive bill like single payer. And it speaks volumes about the radical left that they seem more intent on the former than the latter.

This post was originally published at The Federalist.

Third Dem Debate Leaves Major Health Care Questions Unanswered

For more than two hours Thursday night in Houston, 10 presidential candidates responded to questions in the latest Democratic debate. On health care, however, most of those responses didn’t include actual answers.

As in the past several contests, health care led off the debate discussion, and took a familiar theme: former vice president Joe Biden attacked his more liberal opponents for proposing costly policies, and they took turns bashing insurance companies to avoid explaining the details behind their proposals. Among the topics discussed during the health care portion of the debate are the following.

How Much—and Who Pays?

The problems, as Biden and other Democratic critics pointed out: First, it’s virtually impossible to pay for a single-payer health care system costing $30-plus trillion without raising taxes on the middle class. Second, even though Sanders has proposed some tax increases on middle class Americans, he hasn’t proposed nearly enough to pay for the full cost of his plan.

Third, a 2016 analysis by a former Clinton administration official found that, if Sanders did use tax increases to pay for his entire plan, 71 percent of households would become worse off under his plan compared to the status quo. All of this might explain why Sanders has yet to ask the Congressional Budget Office for a score of his single-payer legislation: He knows the truth about the cost of his bill—but doesn’t want the public to find out.

Keep Your Insurance, or Your Doctor?

Believe it or not, Biden once again repeated the mantra that got his former boss Barack Obama in trouble, claiming that if people liked their current insurance, they could keep it under his plan. In reality, however, Biden’s plan would likely lead millions to lose their current coverage; one 2009 estimate concluded that a proposal similar to Biden’s would see a reduction in private coverage of 119.1 million Americans.

For his part, Sanders and Warren claimed that while private insurance would go away under a single-payer plan, people would still have the right to retain their current doctors and medical providers. Unfortunately, however, they can no more promise that than Biden can promise people can keep their insurance. Doctors would have many reasons to drop out of a government-run health plan, or leave medicine altogether, including more work, less pay, and more burdensome government regulations.

Supporting Obamacare (Sometimes)

While attacking Sanders’ plan as costly and unrealistic, Biden also threw shade in Warren’s direction. Alluding to the fact that the Massachusetts senator has yet to come up with a health plan of her own, Biden noted that “I know that the senator says she’s for Bernie. Well, I’m for Barack.”

Biden’s big problem: He wasn’t for Obamacare—at least not for paying for it. As I have previously noted, Biden and his wife Jill specifically structured their business dealings to avoid paying nearly $500,000 in self-employment taxes—taxes that fund both Obamacare and Medicare.

A March to Government-Run Care

I’ll give the last word to my former boss, who summed up the “contrasts” among Democrats on health care.

As I have previously noted, even the “moderate” proposals would ultimately sabotage private coverage, driving everyone into a government-run system. And the many unanswered questions that Democratic candidates refuse to answer about that government-run health system provide reason enough for the American people to reject all the proposals on offer.

This post was originally published at The Federalist.

The Good, The Bad, and The Ugly of Nancy Pelosi’s Drug Pricing Proposal

During the midterm election campaign, Democrats pledged to help lower prescription drug prices. Since regaining the House majority in January, the party has failed to achieve consensus on precise legislation to accomplish that objective.

However, on Monday a summary of proposals by House Speaker Nancy Pelosi (D-CA)—which became public via leaks from lobbyists, of course—provided an initial glimpse of the Democrat leadership’s policy approach. Party leaders claimed the leaked document describes an old legislative draft (they would say that, wouldn’t they?).

The Good: Realigning Incentives in Part D

Among other proposals, the Pelosi proposal would rearrange the current Part D prescription drug benefit, and “realign incentives to encourage more efficient management of drug spending.” Under current law, once beneficiaries pass through the Part D “doughnut hole” and into the Medicare catastrophic benefit, the federal government pays for 80 percent of beneficiaries’ costs, insurers pay for 15 percent, and beneficiaries pay for 5 percent.

This existing structure creates two problems. First, beneficiaries’ 5 percent exposure contains no limit, such that seniors with incredibly high drug spending could face out-of-pocket costs well into the thousands, or even tens of thousands, of dollars.

The Pelosi proposal follows on plans by MedPAC and others to restructure the Part D benefit. Most notably, the bill would institute an out-of-pocket spending limit for beneficiaries (the level of which the draft did not specify), while reducing the federal catastrophic subsidy to insurers from 80 percent to 20 percent. The former would provide more predictability to seniors, while the latter would reduce incentives for insurers to drive up overall drug spending by having seniors hit the catastrophic coverage threshold and thus can shift most of their costs to taxpayers.

The Bad: Price Controls

The Pelosi document talks about drug price “negotiation,” but the policy it proposes represents nothing of the sort. For the 250 largest brand-name drugs lacking two or more generic competitors, the secretary of Health and Human Services would “negotiate” prices. However, Pelosi’s bill “establishes an upper limit for the price reached in any negotiation as no more than” 120 percent of the average price in six countries—Australia, Canada, France, Germany, Japan, and the United Kingdom—making “negotiation” the de facto imposition of price controls.

Drug manufacturers who refuse to “negotiate” would “be assessed an excise tax equal to 75 percent of annual gross sales in the prior year,” what Pelosi’s office called a “steep, retroactive penalty creat[ing] a powerful financial incentive for drug manufacturers to negotiate and abide by the final price.” Additionally, the “negotiated” price would apply not just to Medicare, but would extend to other forms of coverage, including private health insurance.

But the solution to that dilemma lies in trade policy, or other solutions short of exporting other countries’ price controls to the United States, as outlined in both the Pelosi and Trump approaches. Price controls, whether through the “negotiation” provisions in the Pelosi bill, or related provisions that would require rebates for drugs that have increased at above-inflation rates since 2016, have brought unintended consequences whenever policy-makers attempted to implement them. In this case, price controls would likely lead to a significant slowdown in the development and introduction of new medical therapies.

The Ugly: New Government Spending

While the price controls in the drug pricing plan have attracted the most attention, Democrats have mooted some version of them for years. Price controls in a Democratic drug pricing bill seem unsurprising—but consider what else Democrats want to include:

With enough savings, H.R. 3 could also fund transformational improvements to Medicare that will cover more and cost less—potentially including Medicare coverage for vision, hearing, and dental, and many other vital health system needs.

In other words, Pelosi wants to take any potential savings from imposing drug price controls and use those funds to expand taxpayer-funded health care subsidies. In so doing, she would increase the fiscal obligations to a Medicare program that is already functionally insolvent, and relying solely on accounting gimmicks included in Obamacare to prevent shortfalls in current seniors’ benefits.

This post was originally published at The Federalist.

Rant by Congressional Spouse Illustrates the Problem Facing American Health Care

Last week, the wife of Rep. Joe Cunningham (D-S.C.) went on a self-described “rant on social media” about her health coverage.

Amanda Cunningham’s comments echo claims by Democratic lawmakers like Reps. Alexandria Ocasio-Cortez (D-N.Y.) and Rep. Cindy Axne (D-Iowa) about the problems with their health coverage. For many members of Congress that comes via Obamacare-compliant policies sold on health insurance exchanges.

The comments raise one obvious question: If Democrats don’t like Obamacare plans for themselves, then why did they force all Americans to buy this insurance under penalty of taxation? But beyond demonstrating the bipartisan dissatisfaction with Obamacare, Amanda Cunningham’s story illustrates the larger problems plaguing the American health care system.

Mental Health Parity

In her Instagram post, Cunningham complained that under her Blue Cross Blue Shield policy, “all of my mental health therapy sessions are denied, in addition to all of our marriage counseling sessions.” She continued: “It’s just mind-blowing to me that these basic well-known needs, that mental health is health care, are still being denied, that we’re still fighting for these absolutely basic things—it’s unbelievable to me.”

Cunningham didn’t go into many specifics about her case, but on one level, her argument sounds compelling. The opioid crisis has shone a brighter spotlight on the people who need treatment to cover mental illness or substance use disorders. Congress passed mental health parity legislation (as part of the TARP bill, of all things) in 2008, and Section 1311(j) of Obamacare extended these provisions to exchange plans.

Other People’s Money

On the other hand, consider that members of Congress receive a salary of $174,000 annually—more than most Americans (myself included). Consider also that unlike all other Americans purchasing coverage on Obamacare exchanges (myself included), Cunningham, other members of Congress, and their staff receive (likely illegal) subsidies offsetting much of the cost of their health insurance premiums.

More importantly, consider that each coverage requirement on insurers—whether to cover a certain type of treatment (e.g., mental health, in-vitro fertilization, etc.) or treatments provided by a certain type of provider (e.g., marriage counselor, podiatrist, etc.)—raise the price of health insurance each month. Collectively, the thousands of mandates imposed nationwide increase premiums by hundreds of dollars per year.

They also send a paternalistic message to Americans: The policy-makers who impose these coverage requirements would rather individuals go uninsured, because their premiums have become unaffordable, than purchase a plan without the covered benefit or treatment in question.

She didn’t say it outright, but in her “rant,” Cunningham wanted to raise premiums on other Americans—most of whom earn far less than her family—so she would receive “free” therapy. Viewed from this perspective, her objections seem somewhat self-serving from a family in the upper tier of the income spectrum.

Therein lies the problem of American health care: Everyone wants to spend everyone else’s money rather than their own. Everyone wants “their” treatments—in this case, Cunningham’s counseling sessions—covered, even if others pay more. And if their chosen therapies are covered by insurance, with little to no cost-sharing, patients will consume more health care, because they believe they are spending their insurer’s money rather than their own.

Obamacare Made It Worse

The 2010 health care law didn’t cause this problem. However, as the Congressional Budget Office (CBO) noted in its November 2009 analysis of the legislation’s premium impacts, the federal benefit requirements included in the measure raised insurance rates significantly:

Because of the greater actuarial value and broader scope of benefits that would be covered by new nongroup policies sold under the legislation, the average premium per person for those policies would be an estimated 27 percent to 30 percent higher than the average premium for nongroup policies under current law (with other factors held constant). The increase in actuarial value would push the average premium per person about 18 percent to 21 percent above its level under current law, before the increase in enrollees’ use of medical care resulting from lower cost sharing is considered; that induced increase, along with the greater scope of benefits, would account for the remainder of the overall difference.

In CBO’s view, the law required people to buy richer insurance policies, and those richer policies encouraged people to consume more health care, both of which led to a rise in premiums. Unfortunately, that rise in premiums over the past several years has led millions of individuals who do not qualify for insurance subsidies (unlike Amanda Cunningham) to drop their coverage.

Get the Incentives Right

Sooner or later, our country will run out of other people’s money to spend on health care. Despite her impassioned plea, only a movement away from the solutions Cunningham advocated for can prevent that day from coming sooner rather than later.

This post was originally published at The Federalist.

New LSU “Jobs” Study Raises More Questions Than It Answers

The release by the Louisiana Department of Health late Friday afternoon of an updated study showing the jobs benefit of Medicaid expansion concedes an important point pointed out by the Pelican Institute over 16 months ago. This year’s study admits that the 2018 paper over-counted the federal dollars and jobs associated with Medicaid expansion, because it failed to subtract for the many people who forfeited federal subsidies when they transitioned from Exchange coverage to Medicaid after expansion.

However, the researchers have yet to offer an explanation—or a retraction—of their inflated claims in last year’s paper. Nor have the Department of Health and LSU begun to answer the many questions about the circumstances surrounding these flawed studies.

While correcting one error, this year’s study also contains other questionable claims and assumptions:

  • The 2019 study discusses substitution effects, whereby federal Medicaid dollars merely replace other forms of health care spending. However, unlike a Montana study in which the researchers cite in their work, the Louisiana paper apparently does not quantify instances where federal dollars substituted for dollars previously spent by individuals or employers—thereby inflating the supposed impact of Medicaid expansion. That apparent omission also means the researchers did not quantify the number of people who dropped private coverage to join Medicaid expansion—which internal Department of Health records suggest is larger than the Department has publicly admitted.
  • The 2019 study claims that the federal dollars attributable to Medicaid expansion declined by only 4.4% from Fiscal Year 2017 ($1.85 billion) to Fiscal Year 2018 ($1,768 billion). Yet, the number of jobs attributed to these federal dollars decreased by 25.5%, from 19,195 in 2017 to 14,263 in 2018. This drop in the jobs impact suggests significant changes to the economic modeling used in the 2018 study when compared to this year’s paper. Yet, the researchers provide no explanation for this decline, or any changes in their methodology.
  • While not explaining the decline in the jobs outcomes compared to last year’s paper, the 2019 study also does not explain many other figures cited in the paper. For instance, the paper discusses—but does not include a specific dollar figure for—the federal dollars forfeited by individuals who switched from Exchange coverage to Medicaid expansion. Particularly given the errors in last year’s paper, the researchers had an obligation to “show their work,” and provide clear and transparent calculations explaining their conclusions. They did not do so.

The researchers also fail to note that, their study’s claims to the contrary, Louisiana has barely created any jobs since Medicaid expansion took effect. According to the Bureau of Labor Statistics, in June 2016, the month before expansion took effect, Louisiana had 1,979,100 jobs. According to the most recent federal data, Louisiana’s non-farm payrolls now stand at 1,981,000 jobs—a meager gain of 1,900 jobs in over three years. With Louisiana having over 10,000 more jobs one year before expansion took effect than it does today, the real-life data show that greater dependence on the federal government has not provided the economic boom that the study’s authors claim.

Rather than relying on an expansion of the welfare state to generate jobs—an agenda that has not worked, as the past three years have demonstrated—Louisiana should instead reform its Medicaid program as part of a broader agenda to create jobs and opportunity for the state. The people of Louisiana deserve real change in their lives, not flawed, taxpayer-funded studies attempting to defend the failed status quo.

This post was originally published by the Pelican Institute.