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Jon Gruber

MIT health economist Jon Gruber has made a number of appearances on this blog, and on blogs like this one. Alongside Harvard's David Cutler, he's probably been the most aggressive academic economist supporting the reform effort. On some level, that's no surprise: He was one of the architects of the Massachusetts reform, and arguably the leading health economist in the country, and so he's the guy best versed in the implications of scaling the Massachusetts approach to the whole nation.

What is a surprise is that he's also got a $300,000 contract with the Department of Health and Human Services to use his microsimulation model to produce "a technical memorandum on the estimated changes in health insurance coverage and associated costs and impacts to the government under alternative specifications of health system reform."

I wasn't aware of that, and if I had been, I would've made sure it was disclosed when I quoted Gruber. On the other hand, the implication that Gruber is somehow a paid shill for this bill belies a fairly long and consistent record in support of health reform, and in particular, this type of health reform. In a statement to Ben Smith, Gruber defends his work:

I do indeed have a contract with HHS. Throughout this year I have provided technical assistance to the administration and to Congress with my micro-simulation model, as well as based on my experience as a member of the Massachusetts health connector board. But NONE of the work I have done in public, or any public declarations I have made, has been in any way funded by the Administration. That funding was strictly for internal work that I did for the administration and, via the administration, for congress. All externally visible work and comments, such as my editorials or public reports, have been done on my own time.

Moreover, at no time have I publicly advocated a position that I did not firmly believe - indeed, I have been completely consistent with my academic track record. On the two issues this article raises:

1) I am known in economics as one of the leading experts on the impact of health insurance costs on wages - indeed, I wrote my thesis on that topic and have written extensively since on the fact that health insurance costs are fully translated into wages. I was asked by the editors of the Handbook of Health Economics, a review of literature in this area, to write the review article on this topic.

2) In my role as a member of the MA Health Connector board, I had to help decide what were affordable subsidies for our citizens. I was surprised to find how little work there was on this topic so I undertook a study to help lay out what might be considered affordable. I have since replicated that analysis at the federal level. Every position I have advocated on this topic is completely consistent with these reports.

I've spoken occasionally with Gruber for years now, and never noticed a shade of difference in his positions. Even so, his government contract should have been disclosed to me, and in the future, when I quote Gruber, it will be disclosed to you. In the meantime, if the administration is indeed listening to Gruber, I hope they heed him on this.

By Ezra Klein  |  January 8, 2010; 12:07 PM ET
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Aren't all the supporters in Congress of this bill "paid shills?"

Posted by: AuthorEditor | January 8, 2010 12:38 PM | Report abuse

I agree that the subsidies at the lower end of the income spectrum in the House bill should be in the final bill, but how can they fix that without also requiring greater funding? I thought I heard Sen. Nelson say he would join the filibuster of any bill with an increase in marginal tax rates. Increasing the actuarial value of the plans at the low end of the income spectrum would require more funding than the excise tax and the Medicare spending reductions can fund. How can the conference bill fix the problem in a way that Nelson will tolerate?

Posted by: StokeyWan | January 8, 2010 12:47 PM | Report abuse

Gruber Doesn’t Reveal that 21% of MA Residents Can’t Afford Health Care

But it all comes back to that underlying premise. So long as you define “affordable” in such a way that accepts ongoing medical debt for at least some of your sample in your definition of affordable, then this approach–looking at total risk, rather than whether insurance equates to care, makes sense. It transforms the question of whether health care (not health insurance) is affordable into one that measures degrees of indebtedness for using health care.

But then again, that’s what a lot of bill apologists do: consistently oversell what this kind of reform does, by conflating health insurance with health care.

h/t FDL

Posted by: obrier2 | January 8, 2010 1:12 PM | Report abuse

Gruber Once Argued Against Higher Health Care Cost Sharing

I think you're wrong about the value of the excise tax as structured in the Senate bill and as it looks to be fixed for final passage.

Posted by: eRobin1 | January 8, 2010 1:43 PM | Report abuse

When you say "he's also got a $300,000 contract with the Department of Health and Human Services," is that stictly true? Is it to him directly or to his university (MIT)? Does he directly financially benefit or only indirectly? At most universities, the dean sets your salary and then you try to get grants/contracts to help pay your salary. If you get a big contract it may get you a future raise, or it may not.

Posted by: karlnewman | January 8, 2010 1:45 PM | Report abuse

So, what you want is HHS to not have access to the best models to measure the effects of Health Care Reform? Or you want researchers with good models to stop advocating their positions because they allow the government access to their models? I think we need more government, academic, and industry sharing of information and expertise, not less.

Posted by: ideallydc | January 8, 2010 1:52 PM | Report abuse

"If" the administration is listening?
I assume that's why they're paying him.
A bit of advice, Ezra--ask your sources who is paying them. First year reporting.
Look into it.

Posted by: kmblue | January 8, 2010 1:54 PM | Report abuse

Let me put it this way.

Allowing someone to use a model is different from being paid to produce a model that will be calibrated to ensure support for certain policies.

Posted by: ideallydc | January 8, 2010 1:54 PM | Report abuse

--"[Gruber's] government contract should have been disclosed to me"--

People have been telling you Gruber is a liar and a cheat for months, Klein. Now you have evidence even you can't overlook and you want to dismiss it.

--"In the meantime, if the administration is indeed listening to Gruber [...]"--

Yeah, paying someone $300,000 of other people's money doesn't necessarily mean that that which is purchased will even be looked at. You and Gruber are both party to yet one more layer of dishonesty and immorality.

Posted by: msoja | January 8, 2010 1:58 PM | Report abuse

Make that $400,000 of other people's money into the shill's maw.

Posted by: msoja | January 8, 2010 2:16 PM | Report abuse

Regular readers of this blog know I have long considered Gruber to be, at best, biased. I feel vindicated, but sadly the revelations come too late to prevent passage of this health reform monstrosity.

Posted by: bmull | January 8, 2010 2:36 PM | Report abuse

Ezra is such a political hack. If this was a Republican administration, what would he be saying?

That being said, I agree with him that it shouldn't matter that Gruber has a contract. I just don't think Ezra would be fair to a Republican in this position.

Posted by: lancediverson | January 8, 2010 3:43 PM | Report abuse

Having through the years listened to and studied the work of Jonathan Gruber, I believe that he is a very credible individual with high integrity. But he is also an individual with a bias.

In a 2006 presentation to America's Health Insurance Plans, he stated, "National health insurance means wiping you all out. I just personally don't see that as even worth discussing, for political reasons. As well, I think there are some real economic arguments. At least I think there are economic cases to be made on either side. But the truth is, I just don't think, politically, we're just ever going to be in a place where we can seriously consider national health insurance, Canadian-style health insurance. I just don't think it's worth our brain cells worrying about it."

Earlier this year, when 500 physicians from Massachusetts signed a letter to Sen. Edward Kennedy stating that the Massachusetts model was not a good model for the nation, while encouraging a Medicare-for-all style national health care system, Jonathan Gruber responded by saying the physicians "let the perfect be the enemy of the good." It's a remarkable admission that he concedes that Medicare-for-all is "perfect" but that he rejects it in favor of his preferred private insurance model he promoted before the association of health insurance lobbyists.

(Disclosure: I'm Don McCanne, senior health policy fellow with Physicians for a National Health Program.)

Posted by: dmccanne | January 8, 2010 3:57 PM | Report abuse

This is very serious.

1. Gruber provided his analysis from his microsimulation model on affordability and premiums to this blog and other places publicly-- and still has not made clear whether this analysis was part of his work for the Administration. That's a question that needs an answer.

2. As I wrote at the time of his analysis, the work was shoddy. He preselected specific citizen profiles that showed maximum benefit (i.e. non-group market), and ignored questions that were less clear on premium impact to those with employer-based coverage in the group market. Its frankly embarrassing that the CBO analysis released within days of his own was more thorough and comprehensive than his own. I figured the bias was solely based on his own zeal for reform, now we know he had financial incentives to provide biased work.

3. The lack of transparency and "pay-for-analysis" issue is a core challenge for the health care industry (see Grassley), so its doubly problematic that he's participating in the same behavior he'd presumably criticize the pharma industry for doing, for example.

4. As a member of CBO's panel of health advisors, its unclear whether it is appropriate for him to be holding that position while working for the executive branch, HHS, at the same time.

5. If I was Susan Hockfield, I'd be conducting an investigation. While consulting is typical among university professors, Gruber leveraged his own standing as an MIT professor in making his arguments, without providing sufficient transparency on his advisory role. This may be a violation of university policy-- if it isn't, it should be.

Posted by: wisewon | January 8, 2010 5:36 PM | Report abuse


You've been snookered, bamboozled, conned, made-a-fool-of, hoodwinked, led astray, snowed and deceived!!!!!

Posted by: joepeh | January 8, 2010 6:05 PM | Report abuse

What you have missed, Ezra, is the glaring obvious.

This is another, in a remarkable series of political failures by the Obama White House.

They appear to be shockingly inept at the game of politics, which is surprising, considering Rahm is running the show.

I doubt they will lose in 3 years because people don't like to change ships mid-stream anymore, but, my God, are they going to lose both houses because of the usual mid-term woes and complete stupidity.

Posted by: DAinLA | January 8, 2010 6:12 PM | Report abuse

Ezra, you can't read minds. You don't know to what extent Gruber's work reflects a desire to make his boss happy. I am not shocked that you defend this secretive individual.

Posted by: kingsbridge77 | January 8, 2010 9:25 PM | Report abuse


When Bush did this with Armstrong Williams, Mr. Williams was hounded out of his job and lost the contract.

Mr. Gruber's contract is a no-bid contract. Mr. Gruber is had written papers with the gigilo, Mr. Orzag, for profit. This contract was not awarded appropriately. Mr. Orzag publicly uses Mr. Gruber's fudged studies as evidence, yet doesn't inform the public that he is being paid for his views by taxpayers.

This is truly disgraceful and illegal.

Posted by: Cornell1984 | January 9, 2010 10:47 AM | Report abuse

This man's career in academia should be over after this disgrace, and never again should anyone in the policy-making field take anything this fraud says seriously.

Posted by: Bob65 | January 10, 2010 10:07 PM | Report abuse

I'm actually on Ezra's side regarding Gruber. Not that I agree with Gruber, but I think he is honestly wrong (and that his modeling is honestly a mess), not that he's on the take. Or, at least, not on the take any more than anybody else who has a job, has a peer group, and has a personal point of view.

I don't know if Ezra would extend the same consideration to me if I quoted a Petroleum Industry analysis of the benefits of wind technology. Perhaps so. But I'm of the mindset that, in regards to advocates, either everybody is a shill, or nobody is.

Posted by: Kevin_Willis | January 11, 2010 12:05 PM | Report abuse

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