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Seven Empty Promises About ObamaCare

The president is still struggling to sell his plan.

Peter Suderman
September 9, 2010

Just weeks before the Patient Protection and Affordable Care Act (PPACA)—a.k.a ObamaCare—passed, President Barack Obama urged congressional Democrats to make a final push for the bill, and asked them to schedule a vote as quickly as they could. “From now until then, I will do everything in my power to make the case for reform,” he said.

The bill passed, but the case didn’t take. Since Obama signed the bill into law, its unpopularity has, according to Pollster.com’s multi-poll aggregate, held steady, with roughly 48 percent of the public opposed. Liberal health care activists trying to sell the law and help its supporters in Congress have been forced to backtrack on their messaging—and in some cases, have found that their best strategy is to avoid mentioning the law at all. Now, the Obama administration and its allies are launching a multimillion dollar ad campaign intended to sell the public on the law’s virtues.

The president and his administration, it seems, are still doing everything they can to make the case for reform. The problem is that so much of that case isn’t likely to pay off. Here are seven empty promises made about ObamaCare:

1. If you like your plan, you can keep your plan.
In June of 2009, President Obama gave a press conference where he explained his frequent promise that those who like their health care plans can keep their health care plans. “What I’m saying is, the government is not going to make you change plans under health reform,” he said. So in order to ensure health plan continuity, the law included a “grandfathering” provision that allows employers and insurers to continue offering plans that already exist without subjecting them to new rules and regulations. But the requirements that plans must meet in order to keep their grandfathered status are particularly strict. And in a draft document laying out grandfathering rules, the administration admitted that “after some period of time, most plans will relinquish their grandfathered status.” Meanwhile, the new law may also force more than 3 million seniors to switch their Medicare drug plans, regardless of whether they like them or not.

2. It will put Medicare on better fiscal footing.
In August 2010, the Obama administration’s Department of Health and Human Services released a report claiming that the PPACA would “extend the life of the Medicare Trust Fund by 12 years.” Later, Obama’s Health and Human Services Secretary, Kathleen Sebelius, told ABC News that her view is “supported” by the Congressional Budget Office (CBO). It’s not. Instead, the CBO said that “to describe the full amount of HI trust fund savings as both improving the government’s ability to pay future Medicare benefits and financing new spending outside of Medicare would essentially double-count a large share of those savings.” This view is backed up by Medicare’s top actuary as well, who has written that “in practice the improved (Medicare hospital insurance) financing cannot be simultaneously used to finance other Federal outlays (such as the coverage expansions) and to extend the trust fund.”

3. It will cost around $900 billion.
In September 2009, Obama told a joint session of Congress that his health care plan would cost “around $900 billion over ten years.” The CBO’s final cost estimate for the law came in at about $950 billion—close enough to the president’s figure for government work, perhaps—but a report from the CBO later estimated that the law will actually require about $115 billion in additional discretionary spending, putting the official price tag well over $1 trillion.

4. It won’t cut Medicare benefits.
At a 2009 AARP panel, President Obama brushed away the idea that his health care plan might cut Medicare benefits, telling the audience that “nobody’s talking about reducing Medicare benefits.” But according to the head of the Congressional Budget Office, thanks to $130 billion in planned cuts to companies that offer Medicare Advantage plans, the health care law will “reduce the extra benefits that would be made available to beneficiaries through Medicare Advantage plans.” Roughly 25 percent of Medicare recipients use Medicare Advantage plans. One can argue about whether or not the government should be reducing Medicare benefits, but it’s simply not true that no one in the program will lose the benefits they currently have.

5. It will be paid for “mostly” by shifting around money that we’re already spending.
One of the least popular aspects of the PPACA was its sky high cost. The president tried to combat this by saying that, although the bill would cost “about $100 billion per year,” most of that money would “come from the nearly $2 trillion a year that America already spends on health care.” Actually, the majority of the money from the bill’s official scored cost comes from new taxes. According to the CBO, “the two pieces of legislation [that make up the health care law] were estimated to increase mandatory outlays by $401 billion and raise revenues by $525 billion.”

6. It will give consumers more access and greater choice.
Organizing for America, the successor to Obama’s campaign organization, claims that the new health care law will result in “more choices...for millions of Americans.” But early signs indicate that, as a result of the law, patients and consumers will have fewer options for doctors and health insurance. Most experts, for example, expect that the health care overhaul will result in a serious doctor shortage, particularly amongst primary care phsyicians, meaning many individuals will have to wait longer for care, and may not get to see the doctor they want to see. Meanwhile, insurers in some states are already cutting back on insurance options.

7. It will bring down the price of insurance.
Just a few days before the final law passed, Obama said that “my proposal would bring down the cost of health care for millions." And health care affordability was so crucial to the president’s argument that the word made it into the title of the bill: the Patient Protection and Affordable Care Act. So will health care costs come down? Not likely. The CBO predicted that the law will cause average health insurance premium prices to rise by 10-13 percent. And a recent survey indicates that most businesses expect insurance prices to rise as a result of the PPACA. Perhaps Obama meant that the law would “bend the cost curve” and reduce the growing cost of health care? Even if he did, it wouldn’t matter; that’s not likely either. In June of 2009, CBO Director Douglas Elmendorf warned Congress that its proposals would bend the curve in the wrong direction. And in a May 2010 presentation at the Institute of Medicine, Elmendorf declared that in the CBO’s judgment, “the health legislation enacted earlier this year does not substantially diminish [the] pressure” of rising health costs.

Peter Suderman is an associate editor at Reason magazine. This column first appeared at Reason.com.


Peter Suderman is Associate Editor


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