Warren Asks What the Country Can Do for You

Elizabeth Warren’s release Friday of a more specific health-care platform only raised more questions about Medicare for All and its effects on the middle class. Conservatives as well as Ms. Warren’s Democratic opponents questioned the assumptions behind her claim that she can enact a single-payer plan without raising taxes on the middle class. Yet the harshest critic may be Ms. Warren herself. “Ask not what your country can do for you—ask what you can do for your country,” John F. Kennedy, who once held Ms. Warren’s Senate seat, urged. She refuses to ask the middle class to pay a dime for her costly proposal.

Take Ms. Warren’s assumptions at face value, even if doing so requires a knowing suspension of disbelief. Assume she can reduce the 10-year cost of a single-payer system from the $34 trillion in new federal spending estimated by the liberal Urban Institute to a mere $20.5 trillion. Assume her program would reduce administrative costs without encouraging fraud. Assume also that her proposed wealth tax won’t generate massive tax evasion—she claims a Warren administration would generate $2.3 trillion in new revenue by cracking down on tax avoidance—and that not a penny of her $9 trillion in assessments on employers will end up being paid by workers.

Ms. Warren envisions a $20 trillion expansion of government—the largest in American history—paid for by a fraction of the population. She foresees unlimited “free” health care for millions of families, without so much as a $100 copayment, premium, assessment, tax or other fee.

Sure, the earned entitlement always had an element of fiction. Social Security and Medicare pay benefits based on current cash flows, with their respective trust funds containing little more than promises to pay future benefits. Urban Institute estimates show that even wealthy seniors will receive more in Social Security and Medicare benefits than they paid in taxes. But Ms. Warren’s plan would dispense with the pretense of social insurance, instead creating a crass form of political plunder that uses federal largess to buy votes.

In turning government programs into a version of “Oprah’s Favorite Things”—everyone gets a free car, paid for by somebody else—Ms. Warren follows the example of President Obama. He talked of social solidarity, saying “we’re all in this together,” but shied away from asking anyone other than “the rich” to pay for his new government programs. In 2008 candidate Obama made a “firm pledge” not to raise taxes on families making less than $250,000 a year, “not your income tax, not your payroll tax, not your capital-gains taxes, not any of your taxes.”

The “firm pledge” lasted two weeks. In February 2009 Mr. Obama raised tobacco taxes to fund an expansion of children’s health insurance. Then, after ObamaCare took effect in 2013, the law led at least 4.7 million Americans to receive insurance-cancellation notices. In the years since, the health-insurance market has shrunk by four million people, because those who don’t qualify for subsidies can’t afford coverage—what Bill Clinton called “the craziest thing in the world.” Working families ended up bearing the burden of Mr. Obama’s new programs.

Therein lies the true lesson for the American people. Elizabeth Warren may not ask the middle class to fund Medicare for All—at least not until she’s safely in office—but one can rest assured that, should she succeed in enacting her scheme, all American families will pay.

This post was originally published at The Wall Street Journal.

Pete Buttigieg’s Health Care Sabotage Strategy

After the most recent Democratic presidential debate, when South Bend, Indiana Mayor Pete Buttigieg criticized Massachusetts Sen. Elizabeth Warren for evasiveness on her single-payer health plan, Warren’s staff circulated a Buttigieg tweet from February 2018. The tweet indicates Buttigieg’s support for single-payer 20 months ago, which makes him a hypocrite for criticizing her now, according to the Warren camp.

In response, Buttigieg claimed, “Only in the last few months did it become the case that [single-payer] was defined by politicians to mean ending private insurance, and I’ve never believed that that’s the right pathway.” Apparently, Buttigieg never read Sen. Bernie Sanders’ bill — which Sanders, a Vermont independent, introduced in September 2017 — Section 107(a) of which makes private insurance “unlawful.”

Buttigieg’s evasion follows a consistent pattern among Democrats running for president, a two-step in which candidates try to avoid angering both Americans who want to keep their current coverage and the socialist left, who view single-payer’s enactment as a shibboleth. In January, Sen. Kamala Harris, D-Calif., told the American people, “Let’s move on” from private insurance, but she later put out a health plan that she says retains a role for private coverage. Warren herself said as recently as March that she had embraced approaches other than single-payer to achieving the goal of universal coverage.

More importantly, however, Buttigieg wants to enact single-payer — and has said as much. He just wants to be stealthier than Warren and Sanders in taking away Americans’ private insurance.

‘Glide Path’: An Expressway Toward Government-Run Care

Consider a spokesman’s response to the Warren camp re-upping Buttigieg’s 2018 tweet:

Asked about the tweet, a Buttigieg aide … argued he had not changed his position, saying he supports [single-payer] as an end goal but that he wants to get there on a ‘glide path’ by allowing people to have a choice and opt into the government plan.

Indeed, the health care plan on Buttigieg’s website makes the exact same point: “If private insurers are not able to offer something dramatically better, this [government-run] plan will create a natural glide path to” single-payer.

The details of his health care proposal reveal Buttigieg’s “glide path” as an expressway to government-run care, time and time again favoring the government-run plan over private insurance. Consider the following references to the government-run plan in the health care proposal:

  • “Individuals with lower incomes in states that have refused to expand Medicaid will be automatically enrolled in the [government-run plan].”
  • “Individuals who forgo coverage through their employer because it’s too expensive will be able to enroll in the [government-run plan] and receive access to income-based subsidies that help guarantee affordability.”
  • “Anyone eligible for free coverage in Medicaid or the [government-run plan] will be automatically enrolled.” The plan goes on to admit that “individuals could opt out of public coverage if they choose to enroll in another insurance plan,” but the government-run plan would serve as the default “option.”
  • “Individuals with no coverage will be retroactively enrolled in the [government-run plan].”

By automatically enrolling people in the government-run plan — not private insurance, not the best insurance, not the most affordable insurance, but in the government-run insurance plan — Buttigieg wants to make that “option” the only “choice for Americans.”

In 2009, independent actuaries at the Lewin Group concluded that a government-run plan paying doctors and hospitals at Medicare rates, and open to individuals with employer plans — a policy Buttigieg endorsed in his campaign outline — would siphon 119.1 million Americans away from their private coverage, and onto the government-run plan:

Buttigieg calls his plan “Medicare for All Who Want It.” But given the biases in his plan in favor of government-run coverage, another description sounds more apt: “Medicare: Whether You Want It or Not.”

Opportunistic Flip-Flops

Buttigieg sees political value in hitting Warren from the right on health care. But recall that Barack Obama did the same thing in the 2008 presidential primaries, decrying Hillary Clinton’s proposal to require all Americans to purchase health coverage:

Obama used those attacks to wrest the nomination from Clinton, and ultimately capture the presidency. Once he did, he flip-flopped on the coverage requirement, embracing the individual mandate he had previously attacked during the election campaign.

Buttigieg wants to force all Americans into government-run care. He has said as much repeatedly. His attacks on Warren represent an attempt to sound moderate and draw necessary political distinctions ahead of the Democratic primaries.

While he may moderate his tone to get elected, don’t think for a second he would moderate his policies or do anything other than sabotage private health coverage once in office. We’ve seen this show before — but whether we will see it again remains in the hands of the American people.

This post was originally published at The Federalist.

In Fourth Dem Debate, Warren Maintains Her Health Care Evasion

On Tuesday, Sen. Sherrod Brown—a notable leftist who has said he supports a single-payer health care system in theory—said in a CNN story that “it’s a terrible mistake if the Democratic nominee would publicly support ‘Medicare for All.’” On Tuesday evening, two of the party’s leading contenders for that nomination, Sens. Bernie Sanders and Elizabeth Warren, redoubled their commitment to such a policy, with Warren drawing fire from all sides about her lack of detail surrounding the issue.

As she had in previous debates, Warren refused to get into specifics about how she would pay for the single-payer plan that Sanders has introduced as legislation, and which Warren has endorsed. Sanders has previously admitted that taxes on the middle class would go up under his plan.

Warren would not admit that taxes on the middle class would go up under single payer. She claimed that costs for the middle class would go down on net under her plan, and that she would not sign any legislation that raised costs on the middle class.

However, even this supposed promise raised additional questions:

  1. Who qualifies as middle class in Warren’s estimation? A family making under $50,000, a family making under $250,000, or somewhere in between?
  2. Does Warren’s promise mean that no middle-class families will see their costs go up on net? If so, that seems like an impossibly high bar to clear, as virtually every major law creates both winners and losers. Even though the left tries to turn the federal government into another version of “Oprah’s Finest Things”—“You get a car! You get a car! You get a car!”—it rarely works out that way in practice.
  3. In September 2008, Barack Obama made a “firm pledge” that he would not raise taxes on families making under $250,000 per year—“not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.” That promise lasted for less than a month of his administration. On February 4, 2009, two weeks after taking office, Obama signed a children’s health insurance reauthorization that included a large increase in tobacco taxes—taxes that hit working class families hardest. Given how quickly Obama did an about-face on his campaign promise, why should the American people take Warren’s word any more seriously than they did Obama’s “firm pledge?”

South Bend Mayor Pete Buttigieg also chimed in on the funding discussion. He had previously characterized Warren as “extremely evasive” on the issue during the last debate, and released ads prior to this debate questioning Warren’s and Sanders’ proposals to prohibit private health insurance. During the CNN debate, he pressed both issues, noting (as this commentator has) that Warren has “a plan for everything, except this.” With that, Warren derided Pete’s plan as “Medicare for all who can afford it.”

It seems particularly noteworthy that Warren wants to enact a major expansion of the federal government’s role—the largest expansion of government’s role ever, in both its financial scope and massive reach into every American’s life—yet cannot find a sufficient justification to admit the middle class will pay even a little bit more in taxes to fund this socialist utopia. The former speaks volumes about the left’s ultimate objective—full, unfettered power over the economy—and the latter speaks to the deception they are using to obtain it.

This post was originally published at The Federalist.

The Broken Promises of Louisiana’s Medicaid Expansion

Some in Louisiana want to claim that the state’s expansion of Medicaid to able-bodied adults represents a success story. The facts indicate otherwise. Medicaid expansion has resulted in large costs to taxpayers, significant amounts of waste, fraud, and abuse, and tens of thousands of able-bodied adults shifting from private coverage to government insurance—even while individuals with disabilities continue to wait for care. On issue after issue, Medicaid expansion has massively under-performed its sponsors’ own promises:

The Issue: Enrollment

The Claim: “The Department [of Health] had originally based its projections based on U.S. Census data that counted about 306,000 people as uninsured.” – New Orleans Times-Picayune[1]

The Facts:

  • Even though the Department of Health tried to increase its projected enrollment numbers as soon as it made its first estimate, the expansion population has soared well past even these higher claims.[2]
  • As of April 2019, 505,503 individuals had enrolled in Medicaid expansion—65.2% higher than the Department’s original estimate, and 12.3% higher than the Department’s revised enrollment estimate of 450,000 individuals.[3]
  • Medicaid enrollment has declined slightly since April 2019, but only because the Department of Health removed tens of thousands of ineligible individuals from the rolls that were receiving benefits they likely did not deserve.[4]
  • In the spring of 2019, the Department of Health commissioned several LSU researchers to project Medicaid enrollment in future years. The researchers concluded that participation in Medicaid expansion would bounce back from recent enrollment declines to reach an all-time high this year of 512,142 individuals. The researchers also concluded that Medicaid expansion enrollment would continue to increase in future years. Despite spending a total of $71,120 of federal and state taxpayer dollars on this report, the Department of Health has yet to release it publicly.[5]
  • The fact that the Department of Health cited Louisiana’s uninsured population as only 306,000, and yet enrollment has far exceeded that number, further demonstrates that Medicaid expansion has led residents to drop their private insurance to go on to the government rolls—and encouraged people who do not qualify for subsidized coverage to apply anyway.[6]

The Issue: Costs and Spending

The Claim: “In Fiscal Year 2017, Medicaid expansion saved Louisiana $199 million. Beginning July 1, 2017, these savings are expected to surpass $350 million.” – John Bel Edwards[7]

The Facts:

  • Louisiana’s Medicaid expansion has cost far more than expected, placing a higher burden on taxpayers.
  • In 2015, the Legislative Fiscal Office estimated that expansion would cost around $7.1 billion-$8 billion over five years, or approximately $1.2 billion-$1.4 billion per year.[8]
  • For the fiscal year ended June 30, 2019, Medicaid expansion cost taxpayers an estimated $3.1 billion—more than twice the Legislative Fiscal Office’s original estimates.[9]
  • Because most Louisiana residents also pay federal taxes, shifting spending from the state to the federal government does not “save” Louisianans money. Rather, it means Louisiana taxpayers will continue to pay for this skyrocketing spending, just through their federal tax payments instead of their state tax bills.

The Issue: Fraud

The Claim: “Louisiana Medicaid is tough on fraud….When it comes to getting tough on Medicaid fraud, Louisiana is among an elite group of states leading the way by doing the right thing.” – John Bel Edwards[10]

The Facts:

  • Because Louisiana rushed its way into Medicaid expansion without first building a proper eligibility system, the state has spent hundreds of millions of taxpayer dollars providing subsidized health insurance to ineligible individuals.
  • More than a year after Gov. Edwards made his claim about Medicaid fraud, the Legislative Auditor found that numerous individuals with incomes well above the maximum eligibility thresholds had applied for, and received, subsidized Medicaid benefits.[11] One household sampled in the audit claimed income of $145,146—more than Gov. Edwards’ annual salary of $130,000.[12]
  • Belatedly, the Department of Health finally removed approximately 30,000 ineligible individuals from the Medicaid rolls, including 1,672 individuals with incomes of over $100,000.[13]
  • The Medicaid program spent approximately $400 million less in the fiscal year ended June 30, 2019, in large part due to the disenrollments—suggesting that in prior years, Louisiana taxpayers had spent hundreds of millions per year providing subsidized health coverage to ineligible individuals.[14]

The Issue: Efficient Use of Taxpayer Dollars

The Claim: “I know that any misspent dollar is one that could have paid for health care services for those truly in need. My top priority is to ensure every dollar spent goes toward providing health care to people who need it most.” – Health Secretary Rebekah Gee[15]

The Facts:

  • Internal records indicate that Secretary Gee’s own Department knew that tens of thousands of individuals were dropping private coverage to enroll in government-run Medicaid—yet did little about it.
  • For much of 2016 and 2017, the Louisiana Department of Health compiled data indicating that several thousand individuals per month dropped their existing health coverage to enroll in Medicaid expansion.[16]
  • At the end of 2017, the Department of Health stopped compiling data on the number of people dropping private coverage, claiming the data were inaccurate. However, the Department’s stated reasoning for its action suggests that, to the extent the data were inaccurate, they likely under-estimated the number of people dropping private coverage to enroll in Medicaid.[17]
  • Based on the program’s average cost per enrollee, Medicaid has paid hundreds of millions of dollars per year subsidizing the coverage of people who previously had health insurance.[18] This spending comes over and above taxpayer dollars paid to cover individuals ineligible for benefits, as outlined above.

The Issue: Uncompensated Care

The Claim: “Disproportionate share payments to hospitals have decreased as the uninsured population decreased.” – Louisiana Department of Health[19]

The Facts:

  • Uncompensated care payments to hospitals have remained broadly flat since expansion took effect, and by some measures have actually increased.
  • During the three fiscal years prior to expansion, the state paid an average of $1,039,444,880 to Medicaid providers for uncompensated care—$1,011,324,118 in Fiscal Year 2014, $1,000,502,910 in Fiscal Year 2015, and $1,106,507,612 in Fiscal Year 2016.[20]
  • In the fiscal year ended on June 30, 2019, Medicaid spent an estimated $1,056,458,352 on uncompensated care payments—greater than the average spent on uncompensated care in the three years prior to expansion.[21]
  • The meager $50 million in uncompensated care savings between Fiscal Year 2016 and Fiscal Year 2019 does not even begin to match the more than $3.1 billion annual cost to taxpayers of expansion.[22]
  • Even if the Department of Health wants to claim the modest reduction in uncompensated care from Fiscal Year 2016 to Fiscal Year 2019 as “savings,” that means the Medicaid program is spending approximately $62.03 for every dollar it “saves” in uncompensated care payments.

The Issue: Jobs

The Claim: “An analysis by LSU estimates that Medicaid expansion created more than 19,000 jobs and generated $3.5 billion in economic activity in 2017 alone.” – Health Secretary Rebekah Gee[23]

The Facts:

  • Since Medicaid expansion took effect in July 2016, Louisiana’s economy has created only 2,700 jobs—less than one-seventh of the jobs the LSU study claimed expansion would create.
  • In June 2016, the month before expansion took effect, Louisiana’s non-farm payrolls totaled 1,979,100.[24] According to federal data, as of July 2019 Louisiana’s non-farm payrolls now stand at 1,981,800—a meager increase over more than three years.[25]
  • One year before expansion took effect, in July 2015, Louisiana had nearly 10,000 more jobs (1,991,500) than it does today (1,981,800).[26]
  • Since Medicaid expansion took effect, the total labor force within the state has declined by more than 65,000 individuals, or more than 3%—from 2,161,299 in June 2016 to 2,095,844 today.[27]
  • Within days of the LSU report’s release in April 2018, the Pelican Institute published a rebuttal demonstrating that the LSU researchers likely omitted key facts in their calculations, which meant the study made inaccurate and inflated claims about the fiscal impact of Medicaid expansion.[28]
  • Following an exhaustive series of public records requests with LSU, the university finally admitted that the researchers did indeed omit a key data source from their calculations, leading to inflated claims in their study.[29] While the researchers conceded in one document that their 2018 report “overstate[d] the economic impact of” Medicaid expansion, they have yet to admit this error publicly, and the Department of Health has refused to release the document in which they admitted their error.[30]

The Issue: Vulnerable Individuals Waiting for Care

The Claim: “It’s inconvenient that the facts don’t follow this story. [The Department of Health] ended the wait list for disabilities last year in partnership with the disability community. #Fakenews.” – Health Secretary Rebekah Gee[31]

The Facts:

  • While the Department of Health may have changed the name from a “waiting list” to a “Request for Services Registry,” nearly 15,000 vulnerable individuals continue to wait for access to care.
  • The Department of Health’s own website regarding waiver services includes the following passage: “Waiver services are dependent upon funding, and are offered on a first-come, first-served basis through the Request for Services Registry.”[32] The reference to “first-come, first-served” consideration for waiver applicants clearly indicates that vulnerable individuals continue to wait for care.
  • According to information provided by the Department of Health in response to a public records request, as of May 2019 a total of 14,984 individuals were on the “Request for Services Registry.”[33]
  • Since Medicaid expansion took effect in Louisiana, at least 5,534 individuals with disabilities have died while on waiting lists to access care—more than one-quarter of the at least 21,904 individuals with disabilities nationwide who have died while waiting for services under Medicaid expansion.[34]
  • By giving states a greater federal matching rate to cover able-bodied adults than individuals with disabilities, Obamacare has encouraged state Medicaid programs to discriminate against the most vulnerable individuals in our society.[35]

Medicaid expansion has singularly failed to its advocates’ own promises of success. Louisiana should begin the process of unwinding this failed experiment, and put into practice reforms that can reduce the cost of care for beneficiaries, while focusing Medicaid on the vulnerable populations for which it was originally designed.[36]

 

[1] Kevin Litten, “Louisiana’s Medicaid Expansion Enrollment Could Grow to 450,000,” New Orleans Times-Picayune January 20, 2016, https://www.nola.com/politics/2016/01/medicaid_expansion_500000.html.

[2] Ibid.

[3] Healthy Louisiana Dashboard, http://www.ldh.la.gov/HealthyLaDashboard/; Kevin Litten, “Louisiana’s Medicaid Expansion Enrollment.”

[4] Sheridan Wall, “GOP Legislators Renew Attacks on Medicaid Management as Data Emerges on Misspending,” Daily Advertiser April 9, 2019, https://www.theadvertiser.com/story/news/local/louisiana/2019/04/09/gop-legislators-renew-attacks-medicaid-management-data-emerges-misspending/3418133002/.

[5] Chris Jacobs, “The Report the Department of Health Doesn’t Want You to Read,” Pelican Institute, September 26, 2019, https://pelicaninstitute.org/blog/the-report-the-department-of-health-doesnt-want-you-to-read/.

[6] Chris Jacobs, “What You Need to Know about Medicaid Crowd-Out,” Pelican Institute, May 20, 2019, https://pelicaninstitute.org/wp-content/uploads/2019/05/PEL_MedicaidCrowdOut_WEB-2.pdf.

[7] Louisiana Department of Health, “Louisiana Medicaid Expansion 2016-2017 Annual Report,” http://ldh.la.gov/assets/HealthyLa/Resources/MdcdExpnAnnlRprt_2017_WEB.pdf, p. 2.

[8] Louisiana Legislative Fiscal Office, Fiscal Note on HCR 3 (2015 Regular Session), http://www.legis.la.gov/legis/ViewDocument.aspx?d=942163.

[9] Louisiana Department of Health, “Medicaid Forecast Report: May 2019,” June 10, 2019, http://www.ldh.la.gov/assets/medicaid/forecast/FY19MedicaidForecast-may2019.pdf, Table 3, Expenditure Forecast by Category of Service, p. 2.

[10] Louisiana Department of Health, “Louisiana Medicaid Expansion 2016-2017 Annual Report,” p. 7.

[11] Louisiana Legislative Auditor, “Medicaid Eligibility: Wage Verification Process of the Expansion Population,” November 8, 2018, https://lla.la.gov/PublicReports.nsf/1CDD30D9C8286082862583400065E5F6/$FILE/0001ABC3.pdf.

[12] Ibid., Appendix E, Targeted Selection Individual Medicaid Recipient Cases, pp. 27-29.

[13] Sheridan Wall, “GOP Legislators Renew Attacks on Medicaid Management.”

[14] Melinda Deslatte, “Louisiana Medicaid Spending $400M Less Than Expected,” Associated Press June 12, 2019, https://www.nola.com/news/2019/06/louisiana-medicaid-spending-400m-less-than-expected.html.

[15] Rebekah Gee, “Medicaid Expansion, Fighting Fraud, Equally Important,” Daily Advertiser April 21, 2019, https://www.theadvertiser.com/story/opinion/editorial/2019/04/21/medicaid-expansion-fighting-fraud-equally-imoportant/3534502002/.

[16] Chris Jacobs, “What You Need to Know about Medicaid Crowd-Out.”

[17] Chris Jacobs, “Medicaid Expansion Has Louisianans Dropping Their Private Plans,” Wall Street Journal June 8, 2019, https://www.wsj.com/articles/medicaid-expansion-has-louisianans-dropping-their-private-plans-11559944048.

[18] Chris Jacobs, “What You Need to Know about Medicaid Crowd-Out.”

[19] Louisiana Department of Health, “Louisiana Medicaid Expansion 2016-2017 Annual Report,” p. 7.

[20] Louisiana Department of Health, “Louisiana Medicaid 2016 Annual Report,” http://ldh.la.gov/assets/medicaid/AnnualReports/2016AnnualReport.pdf, Table 3, Medicaid Vendor Payments for Budget Programs by State Fiscal Year, p. 5.

[21] Louisiana Department of Health, “Medicaid Forecast Report: May 2019,” Table 2, Expenditure Forecast by Budget Program, p. 1.

[22] Ibid, Table 3, Expenditure Forecast by Budget Category of Service, p. 2.

[23] Rebekah Gee, “Medicaid Expansion, Fighting Fraud, Equally Important.”

[24] Bureau of Labor Statistics, “Regional and State Employment and Unemployment—July 2016,” August 19, 2016, https://www.bls.gov/news.release/archives/laus_08192016.pdf, Table 5: Employees on Non-Farm Payrolls by State and Selected Industry Sector, Seasonally Adjusted, p. 13. The report for July 2016 reflects final (as opposed to preliminary) data for the June 2016 period.

[25] Bureau of Labor Statistics, “Regional and State Employment and Unemployment—August 2019,” September 20, 2019, https://www.bls.gov/news.release/archives/laus_09202019.pdf, Table 3: Employees on Non-Farm Payrolls by State and Selected Industry Sector, Seasonally Adjusted, p. 10. The report for August 2019 reflects final (as opposed to preliminary) data for July 2019.

[26] Bureau of Labor Statistics, “Regional and State Employment and Unemployment—July 2016,” Table 5, p. 13.

[27] Bureau of Labor Statistics, “Regional and State Employment and Unemployment—July 2016,” Table 3, Civilian Labor Force and Unemployment by State and Selected Area, Seasonally Adjusted, p. 11; Bureau of Labor Statistics, “Regional and State Employment and Unemployment—August 2019,” Table 1, Civilian Labor Force and Unemployment by State and Selected Area, Seasonally Adjusted, p. 8.

[28] Chris Jacobs, “Why Expanding Louisiana’s Program to Able-Bodied Adults Hurts the Economy,” Pelican Institute, April 17, 2018, https://pelicaninstitute.org/policy-brief-debunking-pro-medicaid-report/.

[29] Chris Jacobs, “LSU, Department of Health Inflate Claims in Medicaid Expansion Studies,” Houma Today July 27, 2019, https://www.houmatoday.com/news/20190727/opinion-lsu-department-of-health-inflate-claims-in-medicaid-expansion-studies.

[30] Louisiana State University response to Pelican Institute Public Records Act request, September 23, 2019.

[31] @rebekahgeemd, May 20, 2019, https://twitter.com/rebekahgeemd/status/1130459486307667968.

[32] Louisiana Department of Health Office for Citizens with Developmental Disabilities, “Waiver Services,” http://www.ldh.la.gov/index.cfm/page/142, accessed June 15, 2019.

[33] Louisiana Department of Health, response to Pelican Institute Public Records Act request, May 21, 2019.

[34] Nicholas Horton, “Waiting for Help: The Medicaid Waiting List Crisis,” Foundation for Government Accountability, March 6, 2018, https://thefga.org/wp-content/uploads/2018/03/WAITING-FOR-HELP-The-Medicaid-Waiting-List-Crisis-07302018.pdf.

[35] Chris Jacobs, “How Obamacare Undermines American Values: Penalizing Work, Citizenship, Marriage, and the Disabled,” Heritage Foundation Backgrounder No. 2862, November 21, 2013, http://www.heritage.org/research/reports/2013/11/how-obamacare-undermines-american-values-penalizing-work-marriage-citizenship-and-the-disabled.

[36] Chris Jacobs, “Reforming Medicaid in Louisiana,” Pelican Institute, January 30, 2018, https://pelicaninstitute.org/wp-content/uploads/2018/01/PEL_MedicaidPaper_FINAL_WEB.pdf.

Skyrocketing Premiums Show Obamacare’s Failure to Deliver

According to a recently released report, extending employer-provided health coverage to the average American family equates to buying that family a moderately-priced car every single year. This provides further proof that Barack Obama “sold” a lemon to the American people in the form of Obamacare.

The inexorable rise in health care costs—a rise that candidate Obama pledged to reverse—shows how Obamacare has failed to deliver on its promise. Yet Democrats want to “solve” the problems Obamacare is making worse through even more government regulations, taxes, and spending. Struggling American families deserve relief from both the failed status quo, and Democrats’ desire to put that failed status quo on steroids.

Study of Employer Plans

Obamacare has failed to deliver on that pledge, as premiums continue to rise higher and higher:

Why has Obamacare failed to deliver? Several reasons stand out. First, its numerous regulatory requirements on insurance companies raised rates, in part by encouraging individuals to consume additional care.

The pre-existing condition provisions represent the prime driver of premium increases in the exchange market, according to a Heritage Foundation paper from last year. However, because employer-sponsored plans largely had to meet these requirements prior to Obamacare, they have less bearing on the increase in employer-sponsored premiums.

Second, Obamacare encouraged consolidation within the health care sector—hospitals buying hospitals, hospitals buying physician practices, physician practices merging, health insurers merging, and so on. While providers claim their mergers will provide better care to patients, they also represent a way for doctors and hospitals to demand higher payments from insurers. Reporting has shown how hospitals’ monopolistic practices drive up prices, raising rates for patients and employers alike.

Same Song, Different Verse

More Regulations: On issues like “surprise” billing or drug pricing, Democrats’ favored proposals would impose price controls on some or all segments of the health care industry. These price controls would likely limit the supply of care provided, while also reducing its quality.

More Spending: Most Democratic proposals, whether by presidential candidates, liberal think-tanks, or members of Congress, include major amounts of new spending to make health care “affordable” for the American people—an implicit omission that Obamacare (a.k.a. the “Affordable Care Act”) has not delivered for struggling families.

More Taxes: Even though some don’t wish to admit it, the Democratic candidates for president have all proposed plans that would necessitate major tax increases, from the hundreds of billions to the tens of trillions of dollars—even though at least two of those candidates have failed to pay new taxes imposed by Obamacare itself.

The latest increase in employer-sponsored health premiums demonstrates that hard-working families deserve better than Obamacare. It also illustrates why the American people deserve better than the new Democratic plans to impose more big government “solutions” in the wake of Obamacare’s failure.

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.

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.

Another Study Confirms Obamacare as the Unaffordable Care Act

Despite the high level of partisanship in the United States, both sides can agree on something even as controversial as health care: Both Democrats and Republicans believe Obamacare has failed to deliver.

Based on their last primary debate, Democrats running for the 2020 presidential nomination can’t give away more health care subsidies fast enough. Some of them want to abolish Obamacare outright. But all of them agree the law has not lived up to Barack Obama’s claims during the 2008 campaign, when he repeatedly promised that hisplan would reduce premiums by $2,500 for the average family.

Shrinking Without Subsidies

The CMS analysis of risk adjustment data submitted by insurers focuses on the unsubsidized marketplace. These individuals, who make more than 400 percent of the federal poverty level ($103,000 for a family of four in 2019), do not receive any subsidies from the federal government to offset their premiums.

The analysis concludes that, while the subsidized marketplace has remained steady for the past several years, the number of unsubsidized people purchasing insurance has steadily shrunk as premiums continue to decline. In 2018, even as average monthly subsidized enrollment increased by a modest 4 percent, average monthly unsubsidized enrollment plummeted by 24 percent.

From 2016 through 2018, the unsubsidized market shrank by an even larger amount. Successive price increases — an average 21 percent premium rise in 2017, followed by another 26 percent jump in 2018 — priced many people out of the market.

During those two years, the average monthly enrollment by unsubsidized people fell by 40 percent, from 6.3 million to 3.8 million. Six states saw their unsubsidized enrollment drop by more than 70 percent, with Iowa’s unsubsidized enrollment shrinking by a whopping 91 percent.

The large percentages of unsubsidized people dropping coverage in many states — in most cases, because they could not afford their rapidly escalating premiums — show the unstable nature of the Obamacare “marketplaces.” With only people who qualify for subsidies able to afford their premiums, most states’ insurance markets have become dependent on the morphine drip of subsidies from Washington.

‘Popular’ Preexisting Conditions?

Why have premiums skyrocketed so that only people receiving federal subsidies can afford to pay their insurance rates? A Heritage Foundation analysis from last year provides a clear answer:

A cluster of [Obamacare] insurance-access requirements — specifically the guaranteed-issue requirement and the prohibitions on medical underwriting and applying coverage exclusions for pre-existing medical conditions — accounts for the largest share of premium increases.

In other words, the preexisting condition provisions have proven the largest factor in pricing literally millions of people out of their health insurance coverage. This means, ironically enough, such people now have no coverage should they develop any such condition.

The left does not want to talk about these people. While the liberal Kaiser Family Foundation will survey Americans about the supposed popularity of the preexisting condition provisions, the organization refuses to survey Americans about the cost of these regulations — for instance, whether people think those “protections” are worth spending an extra several thousand dollars a year in higher insurance premiums. As the old legal saying goes, “Don’t ask a question to which you don’t want to know the answer.”

But the American people need to know the answers and need to understand the effects of Obamacare. Liberals wouldn’t have you know it, but families care more about the affordability of health coverage than about losing their coverage due to a preexisting condition. Reforms codified by the Trump administration will help provide portable and more affordable coverage to many Americans and represent one of several better solutions to tackle the preexisting condition problem.

The left’s “solutions” to Obamacare’s skyrocketing premiums represent more of the same — more taxes, more spending, and more subsidies to make coverage “affordable” for a select few. But sooner or later, the left will eventually run out of other people’s money. The Unaffordable Care Act’s failure to deliver demonstrates that the American people need and deserve a better approach than the left can devise.

This post was originally published at The Federalist.

The Fundamental Dishonesty Behind Kamala Harris’ Health Plan

When analyzing Democrats’ promises on health care ahead of the 2020 presidential campaign, a researcher with the liberal Urban Institute earlier this year proffered some sage advice: “We should always be suspect of any public policy—especially when it comes to something as complicated as health care—when anybody tells us everybody is going to get more and pay less for it. It’s really not possible.”

Someone should have given that advice to Sen. Kamala Harris (D-Calif.). Her health plan, a modified version of Sen. Bernie Sanders’ single-payer health care program that she released on Monday in a Medium post and on her website, pledges that it will lead to the following outcomes:

Every American will be a part of this new Medicare system….Seniors will see stronger Medicare benefits than they have now. We will cover millions more people who don’t have health insurance today. And we will reduce costs, save our country money, and ensure that no American has to sacrifice getting the care they need just because the cost is a barrier.

As with Barack Obama’s salesmanship of Obamacare more than a decade ago, Harris’ health plan relies upon the exact strategy the Urban Institute researchers decried of promising everything to everybody. In her socialist utopia, everyone will have coverage—coverage that provides better benefits than the status quo—even as health costs decline dramatically.

Like Obama’s “like your plan” pledge, which PolitiFact dubbed the “Lie of the Year” for 2013, Harris’ plan rests on optimistic scenarios that have little possibility of coming to fruition. But one false premise underpins the entire plan:

We will set up an expanded Medicare system, with a 10-year phase-in period. During this transition, we will automatically enroll newborns and the uninsured into this new and improved Medicare system, give all doctors time to get into the system, and provide a commonsense path for employers, employees, the underinsured, and others on federally-designated programs, such as Medicaid or the Affordable Care Act exchanges, to transition. This will expand the number of insured Americans and create a new viable public system that guarantees universal coverage at a lower cost. Expanding the transition window will also lower the overall cost of the program. [Emphasis mine.]

As any math major can explain, extending the transition window for a move to a single-payer health-care system will not, as Harris tries to claim, lower the overall cost of the program once the entire program takes effect. But it will significantly lower the cost of the program during the transition.

Extending the single-payer transition period to ten years—which conveniently coincides with the ten-year budget window that the Congressional Budget Office uses to analyze major legislation—will keep most of the program’s costs “off the books” and hidden from the public until after her proposal makes it on to the statute books. It also means that her plan wouldn’t take full effect until well after Harris leaves office, meaning she can blame her successor for any problems that occur during the implementation phase.

This fiscal gimmick—delaying most of the spending associated with single payer to outside the ten-year budget window—allows Harris to draw a contrast with Sanders, in which she claims that many middle-class families would not have to pay a single cent in added taxes for all the “free” health care they would receive under a single-payer system:

One of Senator Sanders’ options is to tax households making above $29,000 an additional 4% income-based premium. I believe this hits the middle class too hard. That’s why I propose that we exempt households making below $100,000 [from new taxes to pay for single payer], along with a higher income threshold for middle-class families living in high-cost areas.

Analysts from across the political spectrum agree that the $30 trillion (or more) in new taxes needed to fund a single-payer health care system cannot come from the wealthy alone. Yet Harris proceeds to make that exact argument—that the middle class can have all the “free” health care they want, with someone else footing the bill.

Apart from the fiscal legerdemain, the proposal contains other controversial provisions. While she now claims she would allow private insurance to continue—a reversal of her earlier comments this past January—Harris’ plan states that these insurers would get “reimbursed less than what the [government-run] Medicare plan will cost to operate.” She may tolerate private insurers for the sake of political expediency, but her bias in favor of the government-run plan demonstrates that they would have little more than a token presence in any system of her design.

This post was originally published at The Federalist.

Joe Biden’s Health Care Plan: SandersCare Lite

On Monday morning, former vice president Joe Biden released the health care plan for his 2020 presidential campaign. The plan comes ahead of a single-payer health plan speech by Sen. Bernie Sanders (I-VT) scheduled for Wednesday.

Biden’s plan includes several noteworthy omissions. For instance, it does not include any reference to health coverage for foreign citizens illegally present in the United States. That exclusion seems rather surprising, given both Democrats’ embrace of health benefits for those unlawfully present in last month’s debate, and Biden’s repeated references to the issue.

Biden said later on Monday that illegally present foreign citizens should have access to “public health clinics if they’re sick,” but not health insurance. He also claimed that last month’s debate format did not give him enough time to explain his position.

Overall, however, Biden’s plan includes many similarities to Sanders’. While both Sanders and Biden want to draw contrasts on health care—Sanders to attack Biden as beholden to corporate interests, and Biden to attack Sanders for wanting to demolish Obamacare—their plans contain far more similarities than differences.

Losing Coverage

Sanders’ bill would, as the American people have gradually learned this year, make private insurance “unlawful,” taking coverage away from approximately 300 million Americans. Biden’s plan specifically attacks single payer on this count, for “starting from scratch and getting rid of private insurance.”

As with Obamacare, Biden’s promise will echo hollow. By creating a government-run “public option” like Sanders’, the Biden plan would also take away health coverage for millions of Americans. As I have previously explained, a government-run plan would sabotage private insurance, using access to Treasury dollars and other in-built structural advantages.

In 2009, the Lewin Group concluded that a government-run health plan, available to all individuals and paying doctors and hospitals at Medicare rates (i.e., less than private insurance), would lead to 119.1 million individuals losing employer coverage:

More Spending

Biden would also expand the Obamacare subsidy regime, in three ways. He would:

  1. Reduce the maximum amount individuals would pay in premiums from 9.86% of income to no more than 8.5% of income, with federal subsidies making up the difference.
  2. Repeal Obamacare’s income cap on subsidies, so that families with incomes of more than four times the poverty level ($103,000 for a family of four in 2019) can qualify for subsidies.
  3. To lower deductibles and co-payments, link insurance subsidies to a richer “gold” plan, one that covers 80% of an average enrollee’s health costs in a given year, rather than the “silver” plan under current law.

All three of these recommendations come from the liberal Urban Institute’s Healthy America plan, issued last year. However, they all come with a big price tag. Consider the following excerpt from Biden’s plan:

Take a family of four with an income of $110,000 per year. If they currently get insurance on the individual marketplace [i.e., Exchange], because their premium will now be capped at 8.5% of their income, under the Biden Plan they will save an estimated $750 per month on insurance alone. That’s cutting their premiums almost in half. [Emphasis original.]

That’s also making coverage “affordable” for families through unaffordable levels of federal spending. By its own estimates, Biden’s plan will give a family with an income of $110,000 annually—which is approximately double the national median household income—$9,000 per year in federal insurance subsidies. Some families with that level of income may not even pay $9,000 annually in federal income taxes, depending upon their financial situation, yet they will receive sizable amounts of taxpayer-funded largesse.

Price Controls and Regulations

The drug price section of the Biden plan includes the usual leftist tropes about “prescription drug corporations…profiteering off of the pocketbooks of sick individuals.” It proposes typical liberal “solutions” in the form of price controls, whether importing price-controlled pharmaceuticals from overseas, or allowing “an evaluation by…independent board members” (i.e., bureaucrats) to determine prices.

Ironically, Biden’s plan implicitly acknowledges Obamacare’s flaws. In talking about prescription drug pricing, Biden omits any discussion of the “rock-solid deal” that the Obama administration cut with Big Pharma, so that pharmaceutical companies would run ads supporting Obamacare.

Likewise, Biden’s plan notes that “the concentration of market power in the hands of a few corporations is occurring throughout our health care system, and this lack of competition is driving up prices for consumers.” Yet it fails to note the cause of much of this consolidation: Obamacare encouraged hospitals to gobble up physician practices, and each other, to obtain clout in negotiations with insurers. Typically, after acknowledging government’s failures, Biden, like Sanders, prescribes yet more government as the solution.

In the leadup to debate on “repeal-and-replace” legislation several years ago, conservative Republicans said they did not want any replacement to become “Obamacare Lite.” Just as history often repeats itself, Democrats seem ready to embark on a similar intra-party debate. That’s because, no matter how much Biden wants to draw distinctions between his proposals and single payer, his plan looks suspiciously like “SandersCare Lite.”

This post was originally published at The Federalist.