Elizabeth Warren’s Health Care “Choice:” Dishonesty

In Thursday night’s Democratic presidential debate, Sen. Elizabeth Warren (D-MA) may debut before a nationwide audience a surprising mantra for someone openly committed to enacting a single-payer system of socialized medicine: Choice.

NBC reports that Warren said on Saturday: “We’re going to push through…full health care coverage at no cost for everyone else who wants it—you can buy it for a modest amount. You don’t have to, but it’s your choice.”

To clarify her “you can buy it” comments, Warren’s most recent health care plan said she would immediately make “free” coverage available to anyone making less than two times the federal poverty level ($51,500 for a family of four in 2019), with sliding-scale premiums capped at no more than 5% of income for those making more than 200% of poverty. Her recent speeches have focused on selling this “transition” plan—“free” coverage if you want it, but only if you want it—rather than her earlier single-payer program.

Some conservatives have claimed that Warren’s change in rhetoric marks the “last gasp” for the left’s move towards socialized medicine. Don’t you believe it. Warren hasn’t given up on anything. Nor have Pete Buttigieg and the other candidates who have campaigned against “Medicare for All.” They, and she, have just chosen to become less candid with the American people about how they hope to achieve their ultimate objectives.

Why Warren Pivoted

Two reasons in particular explain why Warren suddenly embraced the mantra of choice. First, most Americans who have health insurance right now like their plan. A Gallup survey found that nearly seven in ten Americans find their health coverage either excellent (27%) or good (42%). In the 18 years since Gallup first started asking this question, the approval number for Americans’ health coverage has never dropped below 63%.

When millions of people received cancellation notices as Obamacare took effect, Barack Obama found out in 2013 how much people like their current coverage. He felt compelled to issue a public apology for his “Lie of the Year,” telling people they could keep their existing plans when many could not. In part due to these events six years ago, the fear of taking people’s coverage away has dominated the health care discussions at this year’s Democratic presidential debates.

By emphasizing choice, Warren seeks to minimize this potential source of controversy for key constituencies. In the Democratic primaries, union households who have negotiated generous health benefits may blanch at losing those benefits; one confronted Sen. Bernie Sanders (I-VT) about the issue in Iowa this past summer.

Then in next year’s general election, educated and affluent voters who have good health coverage will similarly fear a new plan taking that coverage away. As Philip Klein recently noted in the Washington Examiner, proposing the eradication of existing insurance options could well cost Warren in places like the suburbs of Philadelphia, Detroit, and Milwaukee—critically important battleground areas in battleground states.

De-Emphasizing (Middle Class) Tax Increases

Second, Warren’s earlier rhetoric about taking coverage away from all Americans implies another, similarly awkward question: How will you pay for this massive expansion of government? Warren tried to answer this query by releasing a funding proposal in early November, but in truth, it raised more questions than it answered.

To give but one example: Since Warren released her plan, one study found that her proposed wealth tax would raise $1 trillion less in revenue than she claimed. That $1 trillion gap represents money that she would have to get from somewhere else.

Her revenue plan has myriad other gimmicks buried inside (analyzed in detail here). For instance, her estimates didn’t take into account the fact that the tax increases will shrink the economy, and therefore by definition won’t produce all the revenue she claims.

Warren released her revenue plan claiming that she could fund the full cost of her single-payer plan without raising taxes on the middle class. But the more she pushed that plan, the more people would pick apart all the gimmicks—and Warren’s opponents would rightly claim the gap between what she said her plan would raise and what it actually does would end up coming from the middle class. As a result, Warren “chose” to pivot to her “choice” mantra, navigating away from the Scylla and Charybdis of taking away people’s coverage, and raising taxes on the middle class to do so.

Forcing People to ‘Choose’ Socialism

The change in Warren’s tone doesn’t mean she’s changed her ultimate objective, however. Consider her comments at a town hall on Monday: “When tens of millions of people have had a chance to try [the buy-in proposal], I believe, at that point, we’re going to be ready to vote for” single payer (emphasis added).

Like Buttigieg, Warren sees a buy-in program—call it a “government-run plan,” call it a “public option,” call it “Medicare for All Who Want It”—as creating a natural “glide path” to single payer. They remain quite outspoken in their goal: They want to achieve a socialized medicine system. If given the opportunity, they will use policy to accomplish that objective—just slightly more slowly than under an immediate transition to single payer.

A throwaway line in a recent Vox article got at this same point. The article focused on open enrollment for exchange plans, and the fact that insurers must limit enrollment to a certain period of time, because Obamacare’s costly pre-existing condition provisions encourage individuals to wait until they become sick to sign up for coverage. The penultimate paragraph included this claim:

Under the various public options that have been proposed, uninsured people would be automatically enrolled in the new optional government plan. One advantage the government has over private insurers is it doesn’t need its books to balance perfectly; adverse selection [a disproportionate number of sick people signing up] isn’t as big a concern. [Emphasis mine.]

The highlighted line demonstrates how liberals would use taxpayer funds for the government-run plan: subsidizing coverage in advance, or bailing out the government plan after the fact if premiums are set too low, or too many sick people enroll, or both. Vox’s line hints at the left’s true goal through a “public option:” To sabotage private plans, and force people into socialized medicine, one person at a time.

Warren’s “choice” mantra sounds innocuous, but its underlying premise—by her own admission—seeks to create a single-payer system, just over a slightly longer period. Conservatives who think her approach represents anything other than a change in tactics should think again. The wolf attacking private insurance hasn’t disappeared so much as put on a disguise of sheep’s clothing.

This post was originally published at The Federalist.

Bill Clinton’s Right: Pre-Existing Condition Vote IS “The Craziest Thing in the World”

The new House Democratic majority is bringing to the floor a resolution on Wednesday seeking to intervene in Texas’ Obamacare lawsuit. The House already voted to approve the legal intervention, as part of the rules package approved on the first day of the new Congress Thursday, but Democrats are making the House vote on the subject again, solely as a political stunt.

I have previously discussed what the media won’t tell you about the pre-existing condition provisions—that approval of these Obamacare “protections” drops precipitously when people are asked if they support the provisions even if they would cause premiums to go up. I have also outlined how a Gallup poll released just last month shows how all groups of Americans—including Democrats and senior citizens—care more about rising premiums than about losing their coverage due to a pre-existing condition.

Bill Clinton Got This One Right

The current system works fine if you’re eligible for Medicaid, if you’re a lower income working person, if you’re already on Medicare, or if you get enough subsidies on a modest income that you can afford your health care. But the people that are getting killed in this deal are small business people and individuals who make just a little too much to get any of these subsidies. Why? Because they’re not organized, they don’t have any bargaining power with insurance companies, and they’re getting whacked. So you’ve got this crazy system where all of a sudden 25 million more people have health care, and then the people who are out there busting it, sometimes 60 hours a week, wind up with their premiums doubled and their coverage cut in half. It’s the craziest thing in the world.

Why did people “who are out there busting it, sometimes 60 hours a week, wind up with their premiums doubled and their coverage cut in half”? Because of the pre-existing condition provisions in Obamacare.

Clinton knew of which he spoke. Premiums more than doubled from 2013 to 2017 for Obamacare-compliant individual coverage, only to rise another 30 percent in 2018. A Heritage Foundation paper just last March concluded that the pre-existing condition provisions—which allow anyone to sign up for coverage at the same rate, even after he or she develops a costly medical condition—represented the largest driver of premium increases due to Obamacare.

The Congressional Budget Office concluded that the law would reduce the labor supply by the equivalent of 2.5 million workers. Because so many people cannot afford their Obamacare coverage without a subsidy now that the law has caused premiums to skyrocket, millions of Americans are working fewer hours and earning less income precisely to ensure they maintain access to those subsidies. Obamacare has effectively raised their taxes by taking away their subsidies if they earn additional income, so they have decided not to work as hard.

Why Do Republicans Support This ‘Crazy’ Scheme?

Given this dynamic—skyrocketing premiums, millions dropping coverage, taxes on success—you would think that Republicans would oppose the status quo on pre-existing conditions, and all the damage it has wrought. But no.

Guarantees no American citizen can be charged higher premiums or cost sharing as the result of a previous illness or health status, thus ensuring affordable health coverage for those with pre-existing conditions.

I’ve said it before, but I’ll say it again: As a matter of policy, any proposal that retains the status quo on pre-existing conditions by definition cannot repeal Obamacare. In essence, this Republican proposal amounted to a plan to “replace” Obamacare with the Affordable Care Act.

Even more to the point: What’s a good definition for a plan that charges everyone the exact same amount for health coverage? How about “I’ll take ‘Socialized Medicine’ for $800, Alex”?

There are better, and more effective, ways to handle the problem of pre-existing conditions than Obamacare. I’ve outlined several of them in these pages of late. But if Republicans insist on ratifying Obama’s scheme of socialized medicine, then they are—to use Bill Clinton’s own words—doing “the craziest thing in the world.”

This post was originally published at The Federalist.

Poll: People Care MORE About Rising Costs Than Pre-Existing Conditions

Now they tell us! A Gallup poll, conducted last month to coincide with the midterm elections and released on Tuesday, demonstrated what I had posited for much of the summer: Individuals care more about rising health insurance premiums than coverage of pre-existing condition protections.

Of course, liberal think tanks and the media had no interest in promoting this narrative, posing misleading and one-sided polling questions to conclude that individuals liked Obamacare’s pre-existing condition “protections,” without simultaneously asking whether people liked the cost of those provisions.

Overwhelming Concern about Premiums

Ironically, a majority of 57 percent said the denial of coverage for pre-existing conditions did not constitute a major concern for them, with only 42 percent agreeing with the statement. Lest one believe that the relative insouciance over pre-existing conditions came because Democrats won a majority in the House, therefore “protecting” Obamacare, Gallup conducted the survey from November 1–11, meaning more than half the survey period came before the American people knew the election outcome.

By comparison, more than three-fifths (61 percent) of respondents viewed rising premiums as a major concern, with only 37 percent not viewing it as such. Not only did premiums register as a bigger concern by 19 percentage points overall, it registered as a larger concern in each and every demographic group Gallup surveyed:

Income under $30,000: +15 percent (70 percent said premiums were a major concern, 55 percent said pre-existing condition coverage was a major concern)

Income between $30,000-$75,000: +19 percent (63 percent premiums, 44 percent pre-ex)

Income above $75,000: +24 percent (57 percent premiums, 33 percent pre-ex)

On Medicare/Medicaid: +16 percent (60 percent premiums, 44 percent pre-ex)

On private insurance: +24 percent (60 percent premiums, 36 percent pre-ex)

Republicans: +25 percent (52 percent premiums, 27 percent pre-ex)

Independents: +19 percent (64 percent premiums, 45 percent pre-ex)

Democrats: +16 percent (68 percent premiums, 52 percent pre-ex)

Aged 18-29: +16 percent (54 percent premiums, 38 percent pre-ex)

Aged 30-49: +23 percent (65 percent premiums, 42 percent pre-ex)

Aged 50-64: +21 percent (67 percent premiums, 46 percent pre-ex)

Aged over 65: +13 percent (57 percent premiums, 44 percent pre-ex)

Men: +18 percent (56 percent premiums, 38 percent pre-ex)

Women: +20 percent (67 percent premiums, 47 percent pre-ex)

With those double-digit margins (i.e., outside the poll’s margin of error) in every demographic group—including among groups more likely concerned about pre-existing conditions, for reasons either practical (i.e., older Americans) or ideological (i.e., Democrats)—Gallup has overwhelming evidence to support its claim that “concerns are greatest about the possibility of having to pay higher premiums.”

Premiums more than doubled from 2013 to 2017, as the law’s major provisions, including the pre-existing condition requirements, took effect. They again rose sharply in 2018, causing approximately 2.5 million individuals to drop their Obamacare-compliant coverage completely.

Not a Surprise Outcome

The Gallup results confirm prior surveys from the Cato Institute, which also demonstrate that support for Obamacare’s pre-existing condition provisions drops dramatically once people recognize the trade-offs—namely, higher premiums and a “race to the bottom” among insurers, reducing access to specialist providers and lowering the quality of care:

But the polling suggests that Democrats have no such mandate, and that they should think again in their approach. Rather than making an already bad situation worse, and potentially raising premiums yet again, they should examine alternatives that can solve the pre-existing condition problem (and yes, it is a problem) by making it easier for people to buy coverage before they develop a pre-existing condition in the first place.

As the polling indicates, the American people—to say nothing of the 2.5 million priced out of the marketplace in the past 12 months—will thank them for doing so.

This post was originally published at The Federalist.

Obamacare Enrollment Split: Subsidies vs. No Subsidies

Two reports released in the past week demonstrate a potential bifurcation in state insurance exchanges: The insurance marketplaces appear to be attracting a disproportionate share of low-income individuals who qualify for generous federal subsidies, while middle- and higher-income filers have generally eschewed the exchanges.

On Wednesday, the consulting firm Avalere Health released an analysis of exchange enrollment. As of the end of the 2015 open-enrollment season, Avalere found the exchanges had enrolled 76% of eligible individuals with incomes between 100% and 150% of the federal poverty level—between $24,250 and $36,375 for a family of four. But for all income categories above 150% of poverty, exchanges have enrolled fewer than half of eligible individuals—and those percentages decline further as income rises. For instance, only 16% of individuals with incomes between three and four times poverty have enrolled in exchanges, and among those with incomes above four times poverty—who aren’t eligible for insurance subsidies—only 2% signed up.

The Avalere results closely mirror other data analyzed by the Government Accountability Office in a study released last Monday. GAO noted that three prior surveys covering 2014 enrollment—from Gallup, the Commonwealth Fund, and the Urban Institute—found statistically insignificant differences in the uninsured rate among those with incomes above four times poverty, a group that doesn’t qualify for the new insurance subsidies.

The GAO report provided one possible reason for the lack of enrollment among individuals not eligible for federal insurance subsidies. In 2014, premiums remained unaffordable—costing more than 8% of income—across much of the country for a 60-year-old making five times poverty. These individuals earned too much to qualify for subsidies, but too little to afford the insurance premiums for exchange policies. The GAO data confirm my July analysis, in which I wrote: “Those who do not qualify for federal subsidies appear to find exchange coverage anything but affordable.”

Other findings echo the strong link between subsidies and coverage. The Commonwealth Fund’s study last summer noted that among those with incomes between 250% and 399% of poverty, the uninsured rate had not changed appreciably. These individuals don’t qualify for the additional federal assistance with cost-sharing—deductibles, co-payments, and co-insurance—provided to those with incomes below 250% of the federal poverty level. Prior studies have demonstrated that some of these individuals won’t qualify for premium subsidies at all, based on their age, income, and premium levels in their state.

The overall picture presented is one of a bifurcated, or even trifurcated, system of health insurance. Individuals who qualify for very rich insurance subsidies or Medicaid have signed up for coverage, while those who qualify for small or no subsidies have not. It raises two obvious questions: Whether and how the exchanges can succeed long-term with an enrollment profile heavily weighted towards subsidy-eligible individuals—and whether an insurance market segregated by income was what Obamacare’s creators originally had in mind.

This post was originally published at the Wall Street Journal Think Tank blog.

Are the Obamacare Exchanges Attracting People in Poor Health?

The Kaiser Family Foundation released a survey Thursday of individuals who have purchased health insurance during the first open enrollment period under the Affordable Care Act. The poll included a question about self-reported health status, the responses to which suggest that 2014 purchasers through the health exchanges may be less healthy than the broader population.

According to the study, 20% of participants in exchange plans reported their health as being in “fair” or “poor” condition, whereas only 9% of those purchasing exchange-compliant coverage outside of the exchanges report being in fair or poor health.

These findings tend to bolster an April Gallup survey finding that only 12% of those with exchange coverage rated themselves in “excellent” health, compared with 21% buying new coverage this year outside the exchanges and 21% for the U.S. adult population. The Kaiser study did not break out results by age, but the Gallup survey found that only 24% of exchange purchasers were ages 18 to 29, whereas 37% of people in that age bracket purchased coverage this year outside an exchange.

The exchanges appear to attract a different clientele than non-exchange plans, but it’s not yet clear whether that is a first-year anomaly or a larger pattern. Provisions in the law that require insurers to treat their exchange and non-exchange plans as a single risk pool may mitigate disparities between the two markets. But if the insurance exchanges become the virtually exclusive province of the old, sick and those who qualify for subsidies, it is likely to have ramifications throughout the insurance industry and on Obamacare as a whole.

This post was originally published at the Wall Street Journal Think Tank blog.

Obamacare Bad for Businesses

In the past 24 hours, two new polls have once again demonstrated that Obamacare is causing uncertainty for businesses, thereby hindering economic growth.  In a Gallup survey, 57% of Americans thought Obamacare would make things worse for businesses — a margin just short of the 60% of Americans who thought the law would make things worse for taxpayers as a whole.

A separate survey of small businesses conducted by the US Chamber of Commerce echoes the Gallup findings.  That survey found that 72% of small business owners concluded that Obamacare makes it harder for their firms to take on new workers, compared to only 3% who said that the clarity of the Supreme Court’s decision on the law would lead to new hiring.  Many owners also commented that the law would encourage their firm to reduce the size of their labor force, and/or cancel health insurance entirely and dump their workers on to Obamacare Exchanges.

President Obama has attracted controversy in recent days on the basis of remarks he made Friday implying that government is the source for businesses’ success.  Yesterday’s Obamacare surveys reveal, however, that under Obamanomics, those businesses who still can succeed aren’t succeeding because of government intrusion — but despite it.

Just the Facts, Mr. President…

Campaigning in Ohio yesterday, President Obama – in typically modest fashion – said this about the health care law: “The law I passed* is here to stay.”  He followed that up by making the following statement at another campaign event:  “We don’t have to re-litigate the last two years.  I don’t want us to keep having political arguments that are based on politics and not on facts.”  Herewith, two compelling facts:

Fact No. 1:  The Supreme Court upheld the law’s individual mandate as a tax – and ONLY as a taxIf the President doesn’t want to re-litigate the past two years, as he claims, then why doesn’t he acknowledge that the mandate is a tax increase?  Because some would argue that to do otherwise might be based on politics – not on facts.

Fact No. 2:  More Americans think the law will harm the economy than will help it.  So said a new Gallup poll released yesterday.  Which means that if the law really is here to stay, as the President claims, then the American people think the current economic malaise is here to stay as well.  Not an ideal platform on which to run for re-election.

 

* One could also point out Fact No. 3:  Presidents don’t pass laws, Congress does.  While all the Democrat Members of Congress who lost thanks to Obamacare might thank the President for his implicit assertion that he can unilaterally waive his wand and pass a law, it doesn’t actually work that way.  One wouldn’t think a constitutional law professor would make such casual yet incorrect statements.  But then again, one wouldn’t think a constitutional law professor would put half of the health care law’s coverage expansions in jeopardy by signing a bill with unconstitutional provisions either.

White House Admits Obamacare Small Business Failure

The White House released a “fact sheet” this morning on a Treasury budget proposal that attempts to expand and simplify Obamacare’s small business tax credit.  The proposal comes after a recent report from the Treasury’s Inspector General finding only 228,000 taxpayers claimed the credit as of May 2011 – far less than the 4 million some outside groups were claiming could receive the credit.
Implementation Failure
The IRS spent nearly $1 million in taxpayer funds to pay for 4 million postcards promoting the tax credit.  The mailings did not help.  The credit, like the President’s health care law itself, is bureaucratic and poorly constructed.  Republicans pointed out more than a year ago that this credit was too complex to be of much assistance to small businesses.  Independent experts agree – the non-partisan Congressional Budget Office said before the law passed that only 12 percent of individuals with small business coverage would actually benefit from the credit.  The Treasury Inspector General reported that “there are multiple steps to calculate the Credit, and seven worksheets must be completed in association with claiming the Credit.”
Costs on Small Businesses
The President’s health care law’s small business tax credit is having a nonexistent effect on most small businesses.  The law is actually imposing new costs and burdensome regulations on businesses. 
This week a Gallup survey found 48% of small businesses are not hiring because of the potential cost of health care, and 46% are not hiring because of concerns over government regulations – and both of these problems are due in large part to Obamacare.
 
The law imposes nearly $800 billion in higher taxes and dozens of new insurance mandates, each of which could raise premium costs by 1-3 percent.  An article in the New York Times highlighted the skyrocketing premium increases faced by small businesses, profiling small firms hit with premium increases of 20, 40, even 60 percent or more.
Another Failed Promise
The Administration is belatedly admitting that one part of the President’s health care law is bureaucratic, complicated, and harming small businesses.  It would be much better for the Administration to admit that the entire law is, as one analyst put it, “arguably the biggest impediment to hiring, particularly hiring of less skilled workers.”

Democrats Man the Obamacare Lifeboats

The past several weeks have seen several indications of just how willing and eager Democrats – including the President himself – have become to distance themselves from the unpopular, 2700-page health care law:

  • Bloomberg ran a story last week about how President Obama is afraid to talk about Obamacare to average voters; he mentions the law at political fundraisers, but “he’s just not making the sales pitch in public.”  Even liberals have been flummoxed by the President’s silence on Obamacare; one asked rhetorically, “Why not just own it?”
  • Former Senator Blanche Lincoln blasted the Administration for having “4,200 pages of pending, new regulations to be put on the books that just create huge uncertainty.”  She also sounded skeptical of Obamacare: “We have to be willing to look as we make this journey in health care, not only what we’ve done that’s good, but that things that are not going to work.”  Of course, as many would note, Lincoln voted for Obamacare, and thus bears responsibility for the more than 10,000 pages (NOT a mere 4,200 pages) of new federal regulations and notices that have been issued since March 2010 implementing the law’s mandates and requirements.
  • Two weeks ago, five Democrat Senators wrote to the Administration asking for another Obamacare waiver, finally conceding that the law “may cause disruption for farmers and others in the agricultural sector” by causing members of farmer co-operatives to lose their current coverage.  Among the signatories was New York’s Chuck Schumer, who just last March was claiming that “As people learn about the bill…it’s going to become more and more popular….Those who voted for health care will find it an asset, those who voted against it will find it a liability.”  By asking for a waiver, Schumer has now admitted Obamacare is a political liability for him, because as his constituents learned more about the bill, they found out they could lose their current health insurance coverage thanks to a law he voted for.
  • The most recent Kaiser health tracking poll found that only a bare majority of Democrats (52%) approve of the law, and that approval among Democrats dropped by 13 points in just one month.

Last year Speaker Pelosi famously said we had to pass the bill to find out what’s in it.  More than one year later, many Democrats are finally finding out what’s in the law, and have discovered that they don’t like it any more than Republicans do.

Obamacare Versus the American People

Gallup is out this morning with a new survey of American opinions regarding the health care law.  The results are clear: A plurality of Americans – and a plurality of independents – want Obamacare repealed.  Even one-fifth of Democrats (21%) want the law removed from the statute books:

The Gallup survey comes on the heels of last month’s Kaiser Family Foundation tracking poll, which showed approval of the law at an all-time low, and that only a bare majority (52%) of Democrats supported the law.

Last year, former Speaker Pelosi famously said we had to pass the bill to find out what’s in it.  This morning’s survey once again illustrates that the American people have found what’s in the 2700-page Obamacare law – and they don’t much like it.