the national interest

Guy Who Gets Paid to Say Obamacare Doesn’t Work Can’t Find a Single True Fact to Support His Case

Pedro Rojas holds a sign directing people to an insurance company where they can sign up for the Affordable Care Act, also known as Obamacare, before the February 15th deadline on February 5, 2015 in Miami, Florida.
Pedro Rojas holds a sign directing people to an insurance company where they can sign up for the Affordable Care Act, also known as Obamacare, before the February 15th deadline on February 5, 2015 in Miami, Florida. Photo: Joe Raedle/Getty Images

Obamacare has increased enrollment in its health care exchanges to more than 11 million, and the conservative response to the law’s demonstrable success at carrying out its goals has been fascinating to behold. Measured by volume, the right-wing backlash has diminished severely, as great roaring waves of furious anger have given way to irregular ripples of discontent. But measured by its content, very little has changed. Conservatives are talking much less than they used to about Obamacare, but they are saying more or less the same things, treating the law as a costly and obvious failure. What’s most striking is how oblivious most of them remain not only to measures of the law’s success, but even to the broad parameters of its objectives.

To take a typical example, here is Stephen Moore, chief economist at the Heritage Foundation, making his case, such as it is, that Obamacare has failed to meet its cost targets. Perhaps the most revealing aspect of Moore’s column is the fact that, five years after its passage, the chief economist of the most influential conservative think tank in the United States lacks even a passing familiarity with its fiscal objectives.

Obamacare has two fiscal goals. The first is to pay for its expanded coverage with a combination of spending cuts and higher taxes, so that the net effect is to reduce the deficit. The second, and more ambitious, goal is to change the incentives of the health-care system to gradually bring down health-care inflation (a goal health-care wonks have called “bending the curve”). Moore’s column, which I am excerpting in its entirety, makes clear he does not understand either target. Moore begins by defining Obamacare’s goal as reducing the deficit:

If there were a contest for the biggest lie in Washington over the past 30 years, it would be hard to compete with President Obama’s boast that he would put 30 million more Americans on Medicaid and Obamacare subsidies, and this would reduce the budget deficit. That’s got to be right up there with President Clinton declaring, “I did not have sexual relations with that woman.”

A new Congressional Budget Office report has blown the lid off the Obama whopper fib.

Keep in mind what Moore is claiming here. Obama promised that the ACA would reduce the deficit, and according to Moore, the Congressional Budget Office has a new report showing this promise was false. If true, this would be enormous news. In fact, no such finding exists. CBO originally estimated that Obamacare would reduce the deficit. It correspondingly estimated for the next several years that repealing the law would increase the deficit. CBO stopped issuing cost estimates of the overall law. It did, however, report that its estimate of the law’s gross costs — the spending on coverage — has been falling, rather than rising. Indeed, the federal government is now projected to spend less on health care than it was projected to spend before Obamacare was passed:

So, no, there is no CBO report proving that Obamacare increased the deficit, as we shall see when Moore describes what he read:

The Congressional Budget Office reports that through the first four months of fiscal 2015, federal spending is rising at an 8.2 percent clip. Most components of spending are relatively flat and national defense outlays — the most important function of government — are falling. Still, one area accounts for almost the entire budget blowout: Obamacare.

Medicaid spending is up a stratospheric 23 percent so far this year thanks to massive new enrollments. In addition, the $7 billion in Obamacare “exchange subsidies” so far this year brings the rise in costs of the “Affordable” Care Act to nearly 30 percent. In one year. And in an era of almost no inflation. Obamacare has turned out to be, just as feared, the largest expansion of government since the Great Society.

Notice the switch here? Moore began his column by claiming that the CBO has proven that it’s a “lie” that Obamacare would reduce the deficit. But the data he provides does not remotely prove this. It merely shows that federal spending on Medicaid and exchange subsidies — that is, Obamacare — is up in 2015. That is completely different than saying Obamacare has increased the deficit. Indeed, the design of Obamacare all along was to spend money to cover the uninsured, and to cover the cost of this new spending with a combination of spending cuts and higher taxes. There is nothing in Moore’s column to indicate he even understands this.

Instead he proceeds to switch his accusation yet again to claim that Obamacare has led to “higher health costs”:

This stampede of rising health costs was so predictable that most budget experts acknowledged — even liberals, privately — costs would spike when the new health law insurance subsidies kicked in. It had to happen. How could we possibly put tens of millions more Americans on Medicaid and other taxpayer assistance and also save money at the same time? It was a laughable claim that Team Obama somehow reiterated time and again — and they even managed to keep a straight face.

And this is a president who lectures Republicans in Congress about “simple math.”

Moore’s argument is so incoherent that it is hard to follow, but let me try to explain. Higher health costs is not the same thing as higher federal spending on health care. Health-care costs is how much we pay for our treatments (which happens to be much more than what people in other countries pay).

The idea of “bending the curve” is that, in addition to simply paying for the cost of covering the uninsured, Obamacare would try to tame the long-term trend toward health-care inflation. That is not only happening, it is happening in a far more dramatic way than even the most optimistic advocates predicted. Medical costs are rising at the slowest rate in half a century:

So Moore’s belief that we see a “stampede of rising health costs” is the complete opposite of reality.

Having utterly butchered this fact, he immediately switches to yet another argument — Obamacare is failing because people are getting coverage through it:

But now that Obamacare is the law of the land, the White House openly boasts about how many people are relying on taxpayers for health coverage. Listen to what the administration gleefully reported late last year:

Today’s Medicaid enrollment report shows even more great news: Approximately 8.7 million additional Americans now have coverage through Medicaid and [the Children’s Health Insurance Program], many for the very first time. Medicaid enrollment grew to more than 67.9 million in August 2014, which shows nearly a 15 percent increase over the average monthly enrollment for July through September 2013.”

Wait. This is “great news?” How is putting more people on Medicaid a triumph? Medicaid is a welfare program. If this were a well-functioning economy with good jobs, Medicaid rolls would be shrinking and Americans would be coming self sufficient.

Mr. Clinton used to boast — justifiably so — after signing welfare reform about the millions of people that were taken off welfare during his watch. This president perversely boasts about how many people he puts on welfare.

So Moore’s argument here is that covering the uninsured is bad because it’s “welfare.” Note that the colloquial definition of welfare is income support for working-age people who aren’t working, as opposed to government subsidies in general. That’s why “welfare reform” described the reform of Aid to Families With Dependent Children, not Medicaid, or Social Security, or Medicare, or military pensions.

Medicaid, unlike traditional welfare, is not a program that gives people income support as a substitute for wage income. It is available to people who have jobs but not health insurance. To be sure, one might morally object to the government subsidizing health insurance for people who can’t afford it on their own. But Bill Clinton is not and was not one of the people who has ever shared this belief. Clinton tried really hard to create government-subsidized access to health care for the uninsured. He did not consider this “welfare.”

U.S. President Bill Clinton and First Lady Hillary Rodham Clinton listen to Karl Kregor explain, 16 September 1993 in Washington, D.C. why he is afraid of losing health insurance for his family. Photo: Paul J. Richards

Moore then moves on to trying to fulminate against high unemployment, which has been dropping, and is not caused by Obamacare:

A major reason more people are on Medicaid is that a near-record number of Americans of working age don’t have a job. They can’t get health care through their non-existent employer.

Yes, Medicaid enrollment rose in the wake of the economic crisis. What does this have to do with Obamacare being a lie? Or anything?

At the same time, employers are also dropping their health coverage and dumping employees and their families on Medicaid and the Obamacare exchanges. How is this a victory?

In fact, studies in the journal Health Affairs and surveys by Employee Benefit Research Institute and the Society for Human Resource Management found that Obamacare has not caused employers to drop coverage.

Meanwhile, families are reporting hikes in premiums and fees.

This is not enough of a factual statement to have clear meaning. There are lots of families in this country, and some of them report different things.

Premiums for Obamacare plans are on average between 7 percent and 15 percent last year for the broad coverage plans.

It is hard to substantiate or refute this, because it is not even an English sentence. If Moore is contending that the cost of premiums in the exchanges is rising by 7 to 15 percent a year, he is way, way off. Health-care premiums have almost always increased annually throughout history, but the rate of increase next year is far lower than the historic average.

Firms are just starting to respond to the spike in costs by dumping more workers into the government exchanges, which means even higher taxpayer costs.

Here he is repeating a false claim from two paragraphs before.

So, no, Obamacare has not saved families $2,500 a year.

Despite his “So,” which is a word we generally use to indicate that we are continuing a line of thought previously introduced, Moore is bringing a completely different factual claim into this paragraph. He also happens to be, once again, wrong.

Moore, having apparently run out of material, goes on to repeat several more of his previous claims:

No, it hasn’t “bent the cost curve for health care down.” It has made the budget deficit much worse. Americans are losing the health coverage they have.

As shown above, all these claims are demonstrably wrong. He concludes:

This begs the question: Is there a single promise that Mr. Obama made about Obamacare that has proven truthful?

There is not a single substantive claim in this column that appears to be true.

Obamacare-Hater Can’t Find Single True Fact