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More conservative misinformation on health-care reform

I'm not sure whether Stephen Spruiell actually doesn't know how the health-care reform legislation works or is simply being purposefully obtuse in service of his argument, but either way, it's not comforting to see a post, this late in the debate, that is this misinformed on what the bill actually does.

Spruiell think there's a contradiction between disagreeing that "Obamacare represents the government annexation of one-sixth of the U.S. economy" and saying that the insurance offered through the exchanges will now be subject to a basket of regulations. Putting aside the question of whether government regulations are the same as "annexation" (in which case, the apple I'm eating is federally annexed, and I never knew socialism could be this crisp and delicious), the regulations in question are limited to insurance being offered on the exchanges.

Why does that matter? Because the exchanges, as you can see on Page 20 of this CBO analysis, are expected to serve 25 million people by 2019. That is to say, these regulations will be limited to less than 10 percent of the market. And that 10 percent of the market will be primarily composed of the uninsured. Larger employers, and people like me who get their insurance from larger employers, are literally banned from participating in the exchanges, though I hope that will eventually change.

Say what you will about this. It is not "the government annexation of one-sixth of the U.S. economy." It is the government setting up and imposing regulations on a private insurance market to serve the uninsured, self-insured and people in very small businesses who, altogether, will make up less than 10 percent of the insurance market.

Spruiell goes on to say a bunch of other things that are not true. I'll just focus on one: He says the bill "causes premiums to go up," and "makes up for this with subsidies." I'll assume that he's just confused about this CBO report (pdf). But it's really not that confusing. The answer to this question is on Page 6, where you'll find a table comparing, among other things, "Difference in Price of a Given Amount of Insurance Coverage for a Given Group of Enrollees." That is to say, how much will the same insurance package for the same people cost before and after reform? The answer is that it would be 7 to 10 percent cheaper after reform.

The confusion with this report is that it also says that the premiums people in the individual market are actually paying increase after reform (people outside the individual market -- the majority of the population -- see their premiums go down, full stop). There are two reasons for that: The main one is that the subsidies make it possible for them to purchase better policies. Second, there are minimum levels of coverage that insurers will have to abide by, ending the days when they can sell people something called "insurance" that doesn't actually protect people in the case of a health-care problem.

That means people are buying better policies, but in the only apples-to-apples comparison that makes sense, health-care reform makes the premiums on a given insurance policy cheaper. Because of the subsidies (and, to a lesser extent, regulations) people are also buying better insurance policies. Confusing the fact that people can now afford more generous insurance coverage with insurance becoming more expensive is like suggesting that my raise made the cost of food increase.

There are a number of reasons to oppose health-care reform that make perfect sense. But most of them would lead to a complicated, nuanced sort of opposition -- something like the mirror image of the resigned, slightly disappointed support that's prevalent among progressives (David Brooks specializes in this particular emotion). But the more I read movement conservatives writing about this bill, the more I think the ferociousness of their opposition rests atop a vast foundation of misinformation. They're right to be scared of the bill they think President Obama is passing. They're just wrong to think he's passing that bill.

By Ezra Klein  |  March 9, 2010; 10:34 AM ET
 
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Comments

Are they wrong or deliberately misinformed? It seems pretty obvious that the most informed opponents are misleading the less informed to oppose something that is not, in fact, happening. But that has been the whole GOP m-o since Clinton if not Nixon.

Posted by: Mimikatz | March 9, 2010 11:59 AM | Report abuse

The Beauty of Jacob Hacker's Singler-Payer Trojan Hosre approach is that when Single-Payer is a politically losing argument, you simply point out that it is not a direct implementation of Single-Payer.

It is only among true believers that you point out that private insurance companies become the federal government's finger puppets, collecting premiums from the middle class the way the fed might collect taxes, through the IRS, but paying out benefits as a federal appointee sees appropriate.

Is there any doubt that when its all said and done in 10-20 years we are all stuck with the federal government inside our doctor's office? If we're allowed to go and wait on line?

Nicely done Ezra. Jacob Hacker is proud.

Posted by: FastEddieO007 | March 9, 2010 12:03 PM | Report abuse

How can my insurance cost go down.If government requires me to cover my 4 children till 26 years old.Is that offered to me for free?Why would I pay for my healthy childrens healthcare on my expensive policy and will my employer fire older people with children to control ins costs?Crazy

Posted by: jmounday | March 9, 2010 12:03 PM | Report abuse

Actually if you read his latest NYT column (http://www.nytimes.com/2010/03/09/opinion/09brooks.html), Brooks is specializing in exactly the same kind of long since debunked misinformation.

Posted by: redwards95 | March 9, 2010 12:04 PM | Report abuse

The Beauty of Jacob Hacker's Singler-Payer Trojan Hosre approach is that when Single-Payer is a politically losing argument, you simply point out that it is not a direct implementation of Single-Payer.

It is only among true believers that you point out that private insurance companies become the federal government's finger puppets, collecting premiums from the middle class the way the fed might collect taxes, through the IRS, but paying out benefits as a federal appointee sees appropriate.

Is there any doubt that when its all said and done in 10-20 years we are all stuck with the federal government when its over? If we're allowed to go and wait on line?

Nicely done Ezra. Jacob Hacker is proud.

Posted by: FastEddieO007 | March 9, 2010 12:04 PM | Report abuse

Woops. Sorry for double-post.

Posted by: FastEddieO007 | March 9, 2010 12:05 PM | Report abuse

I think you are too easy on David Brooks. The guy just takes talking points of Rep. Paul Ryan and does not even bother doing his homework. He never even mentions about many responses you have presented to Ryan's questions.

Worst of all, NYT will have his column published prominently, comments will not be published (NYT comments is a joke and one of the worsts for a prominent Media which wants to be progressive here...), Editorial Board will not take pains to contradict David Brooks and Ombudsman at NYT will not bother for the factual errors of David Brooks's article. Damage will be done and you will have one more Conservative 'getting away' with false charges and no accountability. (Charles Krauthammer is resident version at WaPo. Why is that these Newspapers feel like keeping a Conservative columnist, challenged on facts, is a sure shot way of bolstering their credentials? Why these cranks?)

At some point, American Newspapers and Media really have to come to a point where they make a decision - do they want to provide straight facts or false commentary. So far it is all flooded with false commentaries and Mandarins at Media outlet are washing their hands. It is the same way as like failure to 'connect dots before 9/11, failure to see through the mushroom cloud of Condi, see through the games of GOP in passing unfunded Medicare Prescription Drug and Bush's unfunded Tax cuts'. American Media sucks, failures continue to pile up.

Posted by: umesh409 | March 9, 2010 12:10 PM | Report abuse

Cmon, folks, the misinformation by politicians and pundits is clearly deliberate. They wouldn't take yes for an answer - this is a Republican bill by any objective measure. It's all about winning.

And unfortunately folks believe them. Nobody will force anybody to carry their kids until 26, but they can if they want to. The kids will indeed have to obtain insurance, but not via dad and mom. My guess is that it will be a better deal on the individual market exchanges if the kid doesn't earn much money and will qualify for a subsidy.

Posted by: utec | March 9, 2010 12:18 PM | Report abuse

"...them would lead to a complicated, nuanced sort of opposition -- something "like the mirror image of the resigned, slightly disappointed support that's prevalent among progressives (David Brooks specializes in this particular emotion)."

Never been much good with labels, and don't claim insider knowledge, but frankly: your writing's not too clear here.

You sayin' Brooks is progressive? Or he's the "complicated nuanced mirror image"? Can ya clarify, or somebody else in the comments pls.?

Cuz if it's the latter -- check out his column today. Betcha there's lots o' populist complicated nuance like that going around. "Don't pass it if you can't pay for it. Today. With non-fudged factors." That's what he was breaking down with the CBO dodges, right?

And if you're saying Brooks is like the disappointed progressive supporting this thing... well knock me over with a feather. That's not his rep., far as I know.

Thanks if somebody can clarify what you wrote there. Former or latter.

Posted by: Mary42 | March 9, 2010 12:21 PM | Report abuse

If the federal government were to suddenly impose regulations on how much the Washington Post can charge to read your blog, how much they can pay you for writing it, how much and under what conditions people may read/participate on your blog----would you consider the possibility that you really work for the government?

The fact that Obama & Pelosi are allowing employment-based healthcare to remain is more a statement on their duplicity rather than how false it is to characterize it as moderate politically. We all now how this will end up. N'est pas?

Posted by: FastEddieO007 | March 9, 2010 12:23 PM | Report abuse

"The kids will indeed have to obtain insurance, but not via dad and mom. My guess is that it will be a better deal on the individual market exchanges if the kid doesn't earn much money and will qualify for a subsidy."


What's the percentage of American kids 18-29 that are employed and bringing in any income at all right now? Either that's an awful lot of subsidy coming from those who are still working, or else Mom and Dad will be paying the mandatory coverage because surely junior is still going to be junior. Kids in that age range have other priotities for their limited, if any, income, and they will put it into foods, cars and mating first. Not mandatory insurance to chivalrously provide for their elders, the poor, and sick whose pre-existing conditions make them unable to bear their own costs without taking from the younger generations.

The old feeding off the young. That's a pretty sick solution and even if it works, the numbers tell us it's a short term fix. (The healthy and those will good access to medical care can just inflate the costs until only they can afford basic mandatory services. Nursing shortage anyone? But not if you can pay on the private market...)

Posted by: Mary42 | March 9, 2010 12:26 PM | Report abuse

Ezra,

If I squint real hard and say "I believe in fairies" and I really mean it, that won't make fairies any more real.

You believe the CBO projections, that this will be budget neutral, that premiums will fall, that this won't be drastically more expensive than projected,and that businesses and individuals will not respond to the incentives laid out in Obamacare. You really really mean it. You believe in health care reform fairies. I believe that people respond to incentives.

Steve

Posted by: FatTriplet3 | March 9, 2010 12:38 PM | Report abuse

"The old feeding off the young."

This characterization is absurdly inflammatory. If I don't have children, maybe I shouldn't have to pay for public schools. If I've never committed a crime, maybe I shouldn't have to pay for prisons.

We hope that the majority of today's young will eventually grow old. And guess what? If they do, they'll go on Medicare and get Social Security and attain some modicum of security in their later years. This is hardly a "sick solution".

Posted by: slag | March 9, 2010 12:39 PM | Report abuse

While the higher cost may reflect more coverage, if the lower-cost-less-coverage "option" is no longer available, it may be fair to say that costs have increased. The question is to what degree that will happen, and to what degree a low-coverage option is truly a viable option.

Posted by: jduptonma | March 9, 2010 12:47 PM | Report abuse

"You believe in health care reform fairies. I believe that people respond to incentives."

A tale of two realities. Ezra believes in the closest thing we can get to hard data on this issue. You believe in your idiosyncratic, idealized version of what you call "incentives". One of you believes in fairies, and it's not Ezra.

I can't believe that, even after the last ten years of stagnant wages and a near-Depression, we still have people who believe so fervently in the Free Market Fairy. Clap harder, people. Clap harder.

Posted by: slag | March 9, 2010 12:48 PM | Report abuse

"At some point, American Newspapers and Media really have to come to a point where they make a decision - do they want to provide straight facts or false commentary."

Can't believe I am writing this, but Sean Penn, stick to acting.

Posted by: wtfci | March 9, 2010 12:54 PM | Report abuse

The conservative comments on this post demonstrate Ezra's point very beautifully.

Fast Eddie: Afraid of a completely different bill that he fears may happen 20 years from now.

JMounday: Afraid of a result that will not be a consequence of the bill.

FatTriplet3: Afraid because he thinks his gut/amateur analysis is more accurate than the analysis of trained professional accountants and economists.

Posted by: zosima | March 9, 2010 12:59 PM | Report abuse

This bill need to save up 20 years of taxes in order to have enough money to inflict its damage on the American people......In other words it sucks before it sucks.

Posted by: FastEddieO007 | March 9, 2010 1:19 PM | Report abuse

Twas so nice to see Eddie apologize for posting a comment. True, it was for double-posting, but I can dream it was Eddie's first tentative gesture towards becoming aware of the value of his comments.

Posted by: WarrenTerra | March 9, 2010 1:31 PM | Report abuse

To Apologizin Eddie: If the free market was the solution, there would be no problem.

Posted by: rjewett | March 9, 2010 1:48 PM | Report abuse

"This characterization is absurdly inflammatory. If I don't have children, maybe I shouldn't have to pay for public schools. If I've never committed a crime, maybe I shouldn't have to pay for prisons."

My children shouldn't have to pay with the lifestyle costs of your diabetes and lack of exercise plan.

People respond to incentives, I agree. There's absolutely no incentives here to put down the donuts.

By asking the next generation of children to subsidize such lifestyles, you are only encouraging more rot and waste. And the money saved by transferring the premium costs from those with "preexisting conditions" to the young?

We just bought em another 2-liter apiece, and an additional box of donuts. That's sick man. Sick sick sick.

Posted by: Mary42 | March 9, 2010 2:02 PM | Report abuse

Ezra, come on, you are smarter than this.

Premiums over the next five years will most certainly go UP.

Why? Because the HCR bill mandates immediately that children with pre-existing conditions must be covered NOW; because the bill doesn't mandate that everyone must have insurance now; because insurance premiums are based on potential future payouts and risk of payouts.

Most importantly, the CBO is forced to assume as true that 1) Congress will have the political will to make the Medicare cuts that are proposed as the way to pay for subsidies for insurance, and 2) healthy people will actually purchase health insurance instead of opting for the MUCH CHEAPER penalty/fine imposed by the government for not having insurance. The CBO is not allowed to have any opinion on these things...they must accept them in good faith.

I suspect MANY people will opt to pay the $95 fine, knowing that if they do get sick they can hop on a plan any old time, with no risk of increased costs, thanks to community rating of health premiums.

You've got to admit, this whole plan is VERY POORLY thought out. Which is why it's actually WORSE than the status quo.

Posted by: boosterprez | March 9, 2010 2:06 PM | Report abuse

"we still have people who believe so fervently in the Free Market Fairy. Clap harder, people. Clap harder."

If that's what it takes to let the premiums be determined by prior costs and risk assessments, I'm clapping baby, I'm clapping.

If that's what it takes to let the liberals have people pay for the costs incurred, offset only by liberal charity and not artificial market influence, I'm clapping baby, I'm clapping.

If that's what it takes to end frivilous lawsuits by those who sometimes just can't accept their bad luck and want to make a buck or two million off it, can ya hear me know? *clap clap clap!*


Truth be told, we've never had a "free market" in healthcare. The do-gooders have artificially tinkered with it to the point of irrepair already. Now just leave those of us who want nothing to do with subsidizing such a sick game out of it.

You choose to insure, or carry the poor, sick, ill, undocumented? Go for it. Leave the rest of us out of this "business model" that take mandate our premium dollars, despite NO SERVICES AT ALL.

(Or do you honestly think everybody goes running to the doctor for their prescription meds every time they can't sleep or get a sniffle, or can't control their sugar intake? Discipline man. And keep your charity acts to yourself.)

Posted by: Mary42 | March 9, 2010 2:08 PM | Report abuse

Obama and the Dem. leadership have been placating the progressive wing of their party, despondent at having failed to win the inclusion of single-payer or the public option, that an amended Senate bill would be the thin edge of a wedge - that it's deficiencies can be "improved" later. Heck, Ezra, has come right out and said that this bill is just scaffolding on which they can build. Well, many of us outside of the Democrat fold take them at their word. And we're not keen to see them begin work on the edifice they envision.

Posted by: tbass1 | March 9, 2010 2:09 PM | Report abuse

"Afraid because he thinks his gut/amateur analysis is more accurate than the analysis of trained professional accountants and economists."

Riight. Because we all know the professionally trained accountants and economists have such an excellent track record in recent years. Lol -- how's that Alan Greenspan looking to ya now, boys and girls, now that the bill's come due and ole Alan's skipped out on picking up the tab?


Even the CBO admits they're rating the bill as it stands, with the trickeries built in to again game the system. (ie/10 years of payments; 6 years of coverage)

Read the Brooks column today for all the details, and the likelihood that we'll glad pay tomorrow for the uncontrolled spending costs today.

Posted by: Mary42 | March 9, 2010 2:12 PM | Report abuse

"Ezra, has come right out and said that this bill is just scaffolding on which they can build. Well, many of us outside of the Democrat fold take them at their word. And we're not keen to see them begin work on the edifice they envision."


Tear Down the Wall~!
Tear Down the Wall !

Posted by: Mary42 | March 9, 2010 2:13 PM | Report abuse

"People respond to incentives, I agree. There's absolutely no incentives here to put down the donuts."

Yes. Because so many people ponder their healthcare costs before they pick up a donut. That's exactly how people think. Exactly.

Thanks for the post, Ezra. What we've learned here today is that, while healthcare reform can improve some things, it certainly can't cure stupid.

Posted by: slag | March 9, 2010 2:14 PM | Report abuse

Sorry Slag and Zosima but there are many, many trained economists and non-ideological pundits who believe that the assumptions being used to sell this reform are wildly unrealistic and do not sufficiently account for the incentives in the reform for healthy individuals to opt out and for both low wage employees and their employers to drop coverage (because the benefits in the exchanges are much more generous). In 1965, Congress estimated that Medicare would cost $12B in 1990. Actual cost: $500B. Sorry if I don't think wishful thinking is enough to counteract reality.

Posted by: FatTriplet3 | March 9, 2010 2:15 PM | Report abuse

Please google health care in Singapore for a look at a system that is extremely popular, provides universal catastrophic coverage and uses market mechanisms to hold down costs. Health care costs are 3% of GDP in Singapore. They have the lowest infant mortality rate in the world. Alternative ideas are those proposed by David Goldhill in How American Healthcare Killed My Father. I would favor a universal government sponsored catastrophic health insurance program. But smart ideas like that aren't coming from either party.

Posted by: FatTriplet3 | March 9, 2010 2:22 PM | Report abuse

Slag,
Sure the donut/health care incentive connection is week. This incentive is not: http://www.john-goodman-blog.com/obamacare-with-lipstick/

Posted by: FatTriplet3 | March 9, 2010 2:25 PM | Report abuse

So you force people to buy more expensive insurance plans and say that's ok since they'll be getting better coverage? Suppose these folks were perfectly happy with their cheaper plans? How is it the government's business to mandate what type of insurance plan you can buy? How about if the government mandates that you can only buy a car that has a certain option package or better and you'll no longer be allowed to buy the cheap cut rate care with the hand crank windows. Do you think people would object to that?

Also, most conservatives don't believe the CBO estimates for the Senate version of Obamacare. Garbage in garbage out. People don't believe that you can create this huge new entitlement without it's costs skyrocketing over the years as the cost savings never materialize and Congress keeps adding more and more goodies to it like they do every other entitlement program. See Social Security and Medicare. People also don't believe that the program cuts to Medicare will ever materialize either. Do you really think that when it comes right down to it that Congress will really cut 500 billion out of Medicare? They keep voting the doc fix in every year.

Lastly most conservatives believe that Obamacare is a trojan horse for single payer. This isn't stretch since that very statement has been made by Obama himself and other Democrats. Once Obamacare goes into affect with its new goverment mandates and bureacacies how hard would it be for future congresses to slowly nibble away at the private healthcare system until eventually it wouldn't exist anymore and presto we're in a single payer system, even though that's not what anyone signed up for originally. I can see it now Democratic congressman John Smith proposes more government involvement in healthcare due to skyrocketing price increases for private insurance due largely to Obamacare mandates. How easy it would be.

Posted by: RobT1 | March 9, 2010 2:31 PM | Report abuse

"Yes. Because so many people ponder their healthcare costs before they pick up a donut. That's exactly how people think. Exactly."

I think young people have been conditioned to think like this. To associate food consumed, exercise performed with good health.

If a diagnosed diabetic doesn't understand the link between diet and their health, what hope is throwing more money at their problems going to bring.

We need CHANGE, definitely. A mindset that understands we each for the most part are responsible for our own controllable health care choices. And that, yes Virginia, sometimes life deals bum fates and bad luck. And nobody can pay to make that all better.

Health insurance does not equal good health either. Not the same thing. You get that, right?

Because if they're still munching donuts, with me paying the costs of their care, that leg will still need to be amputated. And it's gonna hurt them physically whether or not they ever see a bill for the cost of their care.

Wait a minute -- you really don't care about the physical health of these people at all, right? That's why you encourage them to feel as though there is nothing they can control about their own personal health, without gov'mint passed mandatory healthcare insurance.

CHANGE that mindset before you go mandating others carry those costs.

Posted by: Mary42 | March 9, 2010 4:16 PM | Report abuse

Why would anyone get economics advice from a guy whose entire resume consists of various gigs as a leftwing propagandist?

Posted by: RezkoLot | March 9, 2010 6:39 PM | Report abuse

I have a high deductible, low premium, health insurance policy, which is what I need and what I want. "Minimum coverage levels" means I can't have that anymore and will have to pay double or triple for a policy I don't need. But Klein says I should be happy because I'll be saving money. I like the food analogy. Let's enact "minimum quality levels" for grocery stores so they can only sell steak, lobster, and caviar. Then we'll all eat better - and save money doing it!

Posted by: tm14 | March 9, 2010 7:54 PM | Report abuse

You do well to point out that the "higher costs" in the individual market is largely an artifact of people having the money to buy better plan and because of the mandatory minimum plan.

I would also like to point out that the expected drop in premiums for large workers is also an artifact of employers moving off of more expensive plans and onto cheaper ones as a result of the excise tax. Do you approve of this?

Posted by: mazician1 | March 9, 2010 8:15 PM | Report abuse

For all the comments made here, I do not think any pertain. The CBO has not made any cost analysis since last year on any health care bill or proposal.
---------------------------------
Below: Taken from the CBO website
---------------------------------
Congressional Budget Office
Director’s Blog
Monday, February 22nd, 2010 by Douglas Elmendorf

The Obama Administration’s Health Care Proposal
"This morning the Obama Administration released a description of its health care proposal, and CBO has already received several requests to provide a cost estimate for that proposal. We had not previously received the proposal, and we have just begun the process of reviewing it—a process that will take some time, given the complexity of the issues involved. Although the proposal reflects many elements that were included in the health care bills passed by the House and the Senate last year, it modifies many of those elements and also includes new ones. Moreover, preparing a cost estimate requires very detailed specifications of numerous provisions, and the materials that were released this morning do not provide sufficient detail on all of the provisions. Therefore, CBO cannot provide a cost estimate for the proposal without additional detail, and, even if such detail were provided, analyzing the proposal would be a time-consuming process that could not be completed this week."
This entry was posted on Monday, February 22nd, 2010 at 2:23 pm and is filed under Health.

Posted by: Sly_In_Michigan | March 9, 2010 8:35 PM | Report abuse

redwards95: What exactly has been "debunked" in Brooks' column today? I'd love to hear you "debunk" the 10-6 dodge. And can you tell us with a straight face that the excise tax will really be implemented in any meaningful way in 2018?

No question that there's been enough misinformation spread by some rightwing nutjobs for Ezra to keep railing against them for years to come, but the existence of these blowhards doesn't change the simple fact that this bill kicks the hard decisions down the road.

Posted by: SHLL | March 9, 2010 9:46 PM | Report abuse

Ezra's shorter argument...

The cost of policies you are no longer allowed to buy will go down.*

*Policies you are allowed to buy will cost more.

Posted by: captainhendry | March 10, 2010 1:00 PM | Report abuse

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