Decoding HHS Secretary Price’s spin on US health care law

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Price defended the American Health Care Act, the House GOP’s plan to overhaul the health care system, in an interview with CNN. We are going to focus on two claims in particular because they are rather misleading.

Asked by CNN’s Jake Tapper about Medicaid spending cuts — $839 billion over 10 years, according to a Congressional Budget Office estimate in late March — Price responded with a double-talk in Washington on funding for the care program health for the poor. (An earlier CBO estimate pegged the cut at $880 billion, which is the figure Tapper used in the interview.)

“Well, remember where the $880 billion came from. It’s against what’s called a baseline, which is what the federal government, what the Office of the Congressional budget says we’d be spending if we just continued the current law. The fact is, Medicaid spending under the proposal and the budget is increasing every year. And that’s increasing by a factor that’s large – that’s equal to the cost of medical care.

Baseline debates are an old Washington tradition. The CBO calculates what would be needed to maintain current services over a 10-year period, taking into account inflation, population growth, etc. A dollar in 2026 will not go as far as a dollar in 2016.

Here is our favorite example of this phenomenon: defense spending technically remained constant from 1987 to 1994 – $282 billion per year. But look at what happened to the army during those seven years: the number of soldiers fell from 2.2 million to 1.6 million, the number of army divisions was reduced from 28 to 20, the wings Air Force fighters were reduced from 36 to 22, and Navy combat ships were reduced. from 568 to 387. This is because inflation over time has eaten away at the value of those dollars. By most measures, defense spending was reduced during this period, although in theory not a penny was cut.

Price, having served as chairman of the House Budget Committee, certainly understands this concept. Still, he said “there are no cuts to the Medicaid program. There are spending increases. »

Proposed changes to the Medicaid budget would cut spending by nearly 25% over 10 years and cover 14 million fewer people than expected by 2026. But Price is also wrong to assert that “Medicaid spending under of the proposal and the budget are increasing every day. year.”

2017: $390 billion
2018: $395 billion
2019: $409 billion
2020: $395 billion
2021: $396 billion
2022: $405 billion
2023: $419 billion
2024: $436 billion
2025: $455 billion
2026: $475 billion

Note that when the bulk of Medicaid changes take effect in fiscal year 2020, actual spending decreases year over year. In fact, it’s not until 2023 that spending even recovers above the 2019 level. So it doesn’t matter “the benchmark” – spending declines year-over-year in 2020. (HHS doesn’t did not challenge our calculations.)

What’s happening in 2020? Currently, the federal government pays a portion of the cost of Medicaid, at least $1 in matching money for every $1 a state spends on Medicaid, with 90% of the costs should a state expand Medicaid under the Affordable Care from President Barack Obama.

But, under the AHCA, funding would be set per enrollee in a state, using 2016 as the base year. Then, spending increases in each subsequent year would be limited to the medical component of the Consumer Price Index for All Urban Consumers (CPI-U Medical), with a higher rate set for the elderly. , the blind and other disabled from 2020. (In other words, the base rate is locked in for four years, even for the elderly, blind and disabled, so that a baseline lower would be permanently incorporated into future calculations, even for a group requiring additional resources.)

Price said spending would rise “equal to the cost of medical care,” but the CBO projected Medicaid spending per enrollee would rise faster than the rate of medical inflation, so clearly less money each year would be available to serve this population. In any case, it is virtually impossible to predict the strain that aging baby boomers would put on Medicaid. (About 25% of Medicaid spending goes to nursing homes and long-term care.)

At one point, Price assured Tapper that it was “absolutely not” true that people would lose Medicaid as a result of spending cuts. This is a misleading talking point we’ve dissected before, but simple math explains why it’s wrong. People use and turn off Medicaid regularly. If they try to return to the program once the AHCA takes effect, they will lose their grandfathered status.

Price said emphatically that “20 million people” chose to pay a fine because they wanted nothing to do with Obamacare, although if you listened carefully you might have noticed a little caveat at the end of his spiel.

“We have 20 million people across this country who have said to the federal government, ‘Fuck, nonsense, I’m not going to participate in your program because it’s not doing what I need to do. So they pay a fine. They pay a fine or a penalty to the IRS because the feds tell them what they don’t want to do, or they say, give me a waiver.

But it’s wildly inflated. According to a January 9, 2017 letter from IRS Commissioner John Koskinen to Congress, only 6.5 million taxpayers paid “shared responsibility” payments in 2015. This is actually a decrease from 2014, when 8 million taxpayers made a payment. Payouts in 2015 totaled around $3 billion, with an average payout of around $470.

Many people probably only paid a fine for a few months, not an entire year. The Congressional Budget Office estimates that, on average, about 3 million people will pay the uninsured penalty in any given month in 2016.

Notice how Price slipped the word “waiver” at the end? It arrives at 20 million by adding the people who have benefited from an exemption; totaling 12.7 million taxpayers. But Price described it as a kind of mass protest against the law (“hooey, nonsense”). When you dig into the data, that’s not the reason.

Exemptions are granted for a number of reasons, but the most common is that a person has an income below a certain threshold and lives in a state that has not expanded Medicaid eligibility. (The law offered Medicaid to nearly all low-income people whose income was at or below 138 percent of poverty, or $27,821 for a family of three in 2016.) In other words, it is the result of the refusal of the Republican governor or the legislature to accept the expansion.

The second most common exemption is if a citizen lives outside the United States. People also don’t need to pay a penalty if they would have had to pay more than 8.13% of their income (in 2016) to get health insurance.

Alleigh Marré, national spokesperson for HHS, provided the following response for this fact check:

“Washington’s habit of measuring a program’s success by how much money is spent is one reason the Medicaid program is in dire need of reform. The plain text of the AHCA is clear – the spending on Medicaid is growing every year at least at the same rate as average medical spending.AHCA focuses on outcomes, who actually has access to quality care, and how states can have the flexibility to tailor their programs to meet the unique needs of the vulnerable populations that Medicaid was created for. Plus, no matter how you slice it, the fact that 20 million Americans have paid a fine or gotten a waiver from Obamacare is a clear indictment That’s 20 million Americans that our current system has essentially expunged.

Price has been adamant that Medicaid spending will increase year over year in the budget, but that’s not true. It actually decreases in raw dollars after the funding change is implemented. Although HHS suggests that it was saying spending would increase at the rate set by law, this is still misleading. It’s a fixed amount not tied to actual patient spending, so if the money is short, states will have to either make up the difference or reduce spending by limiting enrollment or reimbursement.

Price is also misleading when he states that 20 million people rejected the Affordable Care Act by paying a fine. He slipped the word “waiver” at the end, but that’s still misleading because most of the exemptions granted have nothing to do with “a clear indictment of the law.” It’s troubling that Price’s spokesperson is stepping up her efforts even after we’ve pointed out the facts. People who live in non-expanding states or overseas do not override the law; in fact, the number of people paying a penalty actually decreased by almost 20% between 2014 and 2015, indicating greater acceptance of Obamacare.

We hesitated between Three and Four Pinocchios but finally switched to Four. When you’re cutting spending by more than $800 billion over 10 years, you can’t claim you’re increasing spending “every year.”

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2017-05-08 11:08:23 UTC

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Washington Post Rating Logo Washington Post assessment:

Four Pinocchios

“The fact is, Medicaid spending under proposal and budget is increasing every year.”

in an interview on CNN’s “State of the Union”

Sunday, May 7, 2017

2017-05-07

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2017-05-08 11:09:26 UTC

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Washington Post Rating Logo Washington Post assessment:

Four Pinocchios

“We have 20 million people across this country who have said to the federal government, ‘Phooey, nonsense. I will not participate in your program because it does not do what I need it to do. So they pay a fine.

in an interview on CNN’s “State of the Union”

Sunday, May 7, 2017

2017-05-07

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