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Another Reformicon Faceplant on TrumpCare

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Ramesh Ponnuru is the latest conservative intellectual to apologize for the BCRA. The results are unpersuasive in the extreme:

Republican efforts to pass health-care legislation are in jeopardy again, in part because of controversy over its potential impact on Medicaid. But the Republican reforms are more moderate, and more worthwhile, than they are getting credit for.

If cutting Medicaid by 35% and substantially reducing subsidies and regulations for private insurance, resulting in more than 20 million people without insurance and insurance for most people who maintain it being made worse is “moderate,” I’d hate to see the “extreme” version. And given that the only actual benefits in the bill go to very wealthy people getting a tax cut they will barely notice, the “worthwhile” is also going to be a tough lift.

Here’s the core of the argument, which is worth unpacking:

Medicaid is a program that is rife with inefficiency. A 2015 study found that recipients derived only 20 to 40 cents of benefit for every dollar governments spend on it. Researchers have struggled to find any positive effects Medicaid has on beneficiaries’ physical health.

This description of Medicaid is bad faith almost to the point of dissembling. The first claim leaves the impression that Medicaid is wasteful and inefficient compared to private insurance. But the linked study says no such thing. Rather, it concludes that Medicaid recipients get only 20%-40% of Medicaid benefits because the poor uninsured get a substantial amount of their medical expenses covered by “implicit insurance”: i.e. emergency treatment that is eaten by hospitals and/or taxpayers. The study counts this “implicit” insurance as an existing benefit and hence concludes that less than half of the spending benefits Medicaid recipients because more than half benefits the “implicit insurers.” But there’s nothing “inefficient” about replacing “implicit” insurance with actual insurance — quite the opposite. Actual insurance is a better deal for the poor, hospitals and taxpayers alike. Ponnuru also cites no evidence supporting his implicit claim that the private insurance he prefers is more efficient than public insurance, for this obvious reason that this is utter nonsense.  And the comparison with “implicit insurance” would still hold for private insurance — it’s neither here nor there.

The second claim is phrased cagily enough to not be outright false. But it’s intended to leave the impression that the bulk of the evidence is that having Medicaid is no better in terms of health outcomes than not having insurance at all. But the evidence in fact indicates that the highly implausible claim that Medicaid is no better than being uninsured is false. And, again, it’s pretty infuriating to see affluent conservatives glibly advocating these “are people really better off with health insurance?” experiments being carried out on much less privileged people.

Most of the rest of the column argues (not very convincingly) that the CBO estimates exaggerate the number of people who will be uninsured by BCRA. OK, let’s say arguendo that only 18 million people will lose insurance, leading to still-substantial preventable death, suffering, and financial ruin in order to give a huge tax cut for the rich. What’s the affirmative case for this? There isn’t one. Here’s the punchline:

My own conclusions should probably by now be pretty clear: The CBO is exaggerating the effects of the Republican legislation on Medicaid enrollment, it’s worth putting Medicaid on a firmer footing, and any additional resources for health insurance for low earners should be directed toward enabling them to buy private coverage rather than pumped into Medicaid. On Medicaid, in short, the Republicans are on the right track.

Medicaid will, in the Orwellian phrase, be “put on firmer footing” by massively cutting Medicaid spending and insuring fewer people. Most of these people will lose insurance entirely, and we’re quibbling only over the exact number. To replace Medicaid, Ponnuru gestures in the direction of providing more subsidies to buy inefficient, high-premium insurance, but slightly higher subsidies aren’t going to do much to help poor people who have the choice between insurance with $6,000 in annual deductibles and nothing.

It’s also worth nothing what Ponnuru doesn’t — the the Republican attack on the ACA has been breathtakingly dishonest. Trump promised to protect Medicaid, and not only Trump but Republicans in general have attacked the ACA as having premiums and  deductibles that are too high. Only the BCRA would make these problems much worse. Ponnuru tries to square the circle by arguing that Medicaid cuts don’t really count because the insurance has no added value — but the argument is false. The American public strongly prefers the ACA to BCRA, for obvious reasons that the latter offers massive cuts in exchange for nothing to people who don’t have a large amount of annual investment income. These “reformicon” defenses of BRCA are pathetic — just slightly more sophisticated-sounding versions of what the Wall Street Journal is saying.

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  • Dr. Ronnie James, DO

    “Medicaid will, in the Orwellian phrase, be “put on firmer footing” by massively cutting Medicaid spending and insuring fewer people.”

    The specific Orwellian phrase they refer to with “firmer footing” involves a boot and a face.

    • Jon Hendry

      Or in the Sicilian sense of cement galoshes.

  • howard

    i assume under normal circumstances, chris reddy is an ass, but if the reformicons (not to mention trump) had any brains at all, rather than looking to cut medicaid, they would be pushing reddy’s recommendation to trump to redefine the terms of debate completely by going for “medicaid for all” (which would basically align gop policy with most conservative parties in most advanced economies).

  • Denverite

    This description of Medicaid is bad faith almost to the point of dissembling. The first claim leaves the impression that Medicaid is wasteful and inefficient compared to private insurance. But the linked study says no such thing. Rather, it concludes that Medicaid recipients get only 20%-40% of Medicaid benefits because the poor uninsured get a substantial amount of their medical expenses covered by “implicit insurance”: i.e. emergency treatment that is eaten by hospitals and/or taxpayers. The study counts this “implicit” insurance as an existing benefit and hence concludes that less than half of the spending benefits Medicaid recipients because more than half benefits the “implicit insurers.” But there’s nothing “inefficient” about replacing “implicit” insurance with actual insurance — quite the opposite. Actual insurance is a better deal for the poor, hospitals and taxpayers alike.

    I’m actually willing to give Ponnuru the benefit of the doubt and think that his blatant misinterpretation of the study is 90% stupidity and only 10% malice. I don’t think he understood that “implicit insurance” means “uncompensated care provided by providers who just eat their cost.” He saw the $0.20-$0.40 figure and just thought that it meant that most Medicaid spending goes to bloated government bureaucracies.

    • Joe Paulson

      Ah. The tactic where you are overly generous since it still makes the other person look like a tool. I like it.

    • You’re on the right track with this. In the conservative mindset, medical care provided by emergency rooms is both free to the user and completely costless to society.
      The other big chunk of conservative thinking is that most people have too much access to healthcare, and thus drive up costs through excess demand. For example, if we made healthcare universal and free, people would start having surgeries and diagnostic procedures just because they’re free. While most of us cannot imagine going for, say, three colonoscopies a year just because we don’t have to pay for them, conservatives really believe that there would be a run on such procedures.

      • randykhan

        I had someone tell me yesterday that nobody would lose health care even with the reductions in Medicaid because no emergency room ever turns anyone down. He apparently was unaware that vaccinations (other than, I suppose, tetanus and rabies), pre-natal care, well baby care, and a host of other services generally are not offered by ERs.

        (The other lovely thing about this comment was that it was in response to an article about how many people would lose health insurance, and the guy did not pick up the *cough* highly nuanced *cough* difference between health insurance and health care.)

        • “Nobody in America is ever denied healthcare because they can always go to the ER for treatment!”
          Okay. Stroll on over to the ER and explain that you need some chemotherapy. Not happening. Maybe you can ask them for some physical therapy to help with your diabetic neuropathy. Also not happening. How about some surgery to remove the benign tumor that’s making it impossible to walk? Nope, that;s not happening either.

          • randykhan

            What makes it particularly good as a stupid talking point is the number of ways in which it’s stupid.

      • I’m actually willing to give Ponnuru the benefit of the doubt and think that his blatant misinterpretation of the study is 90% stupidity and only 10% malice.

        90% seems too high. From the abstract of the paper he links to:

        Our baseline estimates of Medicaid’s welfare benefit to recipients per dollar
        of government spending range from about $0.2 to $0.4, depending on the framework, with at least two-fifths – and as much as four-fifths – of the value of Medicaid coming from a transfer component, as opposed to its ability to move resources across states of the world. In addition, we estimate that Medicaid generates a substantial transfer, of about $0.6 per dollar of government spending, to the providers of implicit insurance for the low-income uninsured. The economic incidence of these transfers is critical for assessing the social value of providing Medicaid to low-income adults relative to alternative redistributive policies.

        Now I’m willing to believe that it’s 20% a hard paper, 30% direct stupidity and 40% implicit stupidty/malice with 10% overt malice.

        (It’s not a trivial paper. There are several sorts of models and interpreting them is challenging. Applying them to decision making moreso. Check out the conclusion which doesn’t want to copy and paste. And Disqus doesn’t want me to upload an image. Gist: It’s hard to determine even from a welfare perspective whether you should prefer $1 medicaid vs. $1 of ETIC. More importantly, there seem to be non-utilitarian reasons to prefer health care. In particular, it doesn’t seem we’d get rid of implicit insurance which suggests that we won’t replace that expenditure.)

        ETA: I see other people have already made this point…

    • nominal

      But the stupidity itself is 100% malicious. The same sentence that says recipients get 20-40% of the benefit of medicaid says that the other 60% goes to medical providers. It’s impossible to miss unless you’re actively trying to misunderstand it.

      No, it’s pure evil all the way down.

      • Scott Lemieux

        And, as Nathan Newman said on twitter, the fact that the ACA restores critical funding to hospitals was a major selling point of the bill, not some secret.

  • Kevin

    I still can’t believe people give “reformacons” the benefit of the doubt. It’s been clear from day 1 that guys like this are hacks just trying to gain employment in the more moderate establishments (NYTimes, etc) to spread the same bullshit their more “extreme” conservatives push in their swamps.

    • Kevin

      Lol, I wish we could see who downvoted us! Why on earth would this statement get a downvote on this of all websites??

      • mds

        (1) Relax, it’s not like you lose actual real-world karma … do you?

        (2) I confess, I did it, but only because of the spelling of “reformicons.”

        (3) (2) is not intended to be a factual statement.

        • Kevin

          I’m plenty relaxed. Just found the whole thing bizarre (got notification for something and saw it. I’ve said plenty that warrants a downvote, so this made me laugh. Is Ross Douthat a blog commentor?)

          Also, I’ll spell made up words any damn way I like! Get off my lawn!

          • DrS

            It all went to hell with that damned Noe Webbster and his infernal booke!

  • Joe Paulson

    Defense: yes this is horrible, but it is 20% less horrible than some people say.

    And, it screws over Planned Parenthood some. Almost worth it on that ground alone!

    • Denverite

      I bet it doesn’t screw over PP at the end of the day. They need one of Murkowski and Collins, and neither will vote for it if it does.

      • Joe Paulson

        We shall see — in long run, it will do so somehow; it’s a question of how blatantly. They need 50 votes. So, guess we are assuming another ‘no.’

        ETA: Let’s see how he votes.

        • Denverite

          Heller

        • Most likely scenario–turn PP funding into a separate block grant to the states. Thus, PP is funded (officially), but all the red states can refuse the block grants by not applying for them, or take the money and divert it to “equivalent” programs such as “Joe Blow’s Church of the Divine Pregnancy Crisis Center.”

      • mds

        They need one of Murkowski and Collins, and neither will vote for it if it does.

        Why? As of the end of 2016, Senator Collins has a lifetime Planned Parenthood Action Fund score of 59%. Senator Murkowski is at 44%. While this is impressive compared to everyone else in their caucus, that Murkowski score in particular seems a pretty slender reed to hang everything on. The last time they were united in opposition over rolling back Obama’s Title X executive order, you’ll notice that it still passed 51-50. With Heller (probably) preemptively snagging one of the No votes this time around, one of them will have to give way. And with Collins’ slightly better score and her remarks about feedback over the 4th of July break, I’m guessing it’ll be Murkowski giving way. What’re they going to do, primary her from the left?

  • DamnYankees

    As I said last time, I don’t understand why we keep doing this. Liberals know what this bill is. Conservative know what this bill is. Every Senator knows what this bill is. They will either vote for it, or they won’t. If they vote for it, they will either suffer for it electorally, if they won’t.

    I’m so very tired of engaging in these discussions with bad faith conservatives. There’s no point anymore.

    • Scott Lemieux

      If the passage of the AHCA after its initial failure shows anything, it’s that silently allowing Republicans to go about their business is the best approach.

      • DamnYankeesLGM

        You don’t need to silently go around; I’m all for protest and town halls and all that good stuff. I just don’t see how responding to Ramesh Ponnuru or Avik Roy or other hacks on LGM does much at this point.

        I mean this as a serious question, and absolutely not a criticism, but why do you write posts like this? Is it just to vent? Totally find if it is, but that seems like it’s the only real reason to do it.

        • Scott Lemieux

          If pointing out that influential defenders of an extremely important bill are lying isn’t a valid subject for a political blog, I’m not sure what you think is.

          • reattmore

            Probably the sins of Clintonism

        • ColBatGuano

          What do you think the point of this blog is? Why are you reading it?

          • bs

            “DamnYankeesLGM”? It’s Ted “I shit myself for 2 weeks to avoid being drafted” Nugent FFS!

  • Downpup E

    The tightening focus on the number who will lose insurance can obscure the much larger number of people who will just pay more & get less.

  • FlipYrWhig

    If this is such a salutary Medicaid reform plan, why not just do it on its own instead of tying it all up with a package of tax cuts for the rich and other nonsense?

    • Aaron Morrow

      Ponnuru also wants to lower the effective tax burden on the rich.

  • ForkyMcSpoon

    Interesting how many reformicon ideas like “trying to appeal to the economic issues of the working class” go out the window once the opportunity to actually fuck poor/working people over to fund tax cuts for the wealthy presents itself.

    I always got the impression if they actually cared about the things they claimed to, they would’ve become Democrats, or at least independents who voted Democratic in the past few elections.

  • Jeremy7

    So yesterday, I found myself watching Fox News (not by choice–I had to go to the gym to run on a treadmill, due to 110 degree heat, and that is what the gym was showing on one of it’s screens). It was interesting to see how they were trying to sell this bill to their base.

    Purportedly, they were doing a “bipartisan panel discussion” about health care, featuring “real people with differing views.” In reality, it was a group of Republicans who had been well-briefed on their talking points (well, except for one woman, who kept hesitating and very obviously referring to her cue cards).

    Each one referred to Obamacare as a “disaster,” and repeated the same two talking points about the new bill 1) “it’s not perfect, but it’s better than what we have”; and 2) “I appreciate that this bill is being debated in public, unlike Obamacare which was rushed through in the middle of the night/no Republicans voted for it/”we have to pass it to see what’s in it”/etc.”

    Setting aside the obvious falseness of the talking points, two things about this struck me as interesting. First, it’s interesting that Fox News is apparently fully behind the bill and trying to propogandize the rubes into supporting it too. Second, I kept thinking–is anyone buying this tripe? Is simply “not being Obamacare” sufficient for rank-and-file Republicans to support the bill? Fox News is apparently betting on “yes” and I’m guessing they are right.

    • mattmcirvin

      All Facebook right-wingers seem to know about Obamacare is that it made their insurance premiums go up by gigantic factors, probably because the insurance company told them it did.

      • DAS

        I remember when the Clinton administration was pursuing health care reform, every annoying decision our HMO made, both in terms of our benefits and in terms of my dad’s work conditions (who was a health professional who worked for said HMO’s medical group) was justified by “we need to position ourselves so that it will be easy to comply with anticipated health care reforms”. IOW, you don’t even need an actual health care reform bill passed for insurance companies to use that as an excuse to screw you over!

        • CP

          But at least once it was clear that there would be no health care reform, all the annoying decisions stopped… right?

        • mds

          They did that with the ACA, too … blamed the latest round of nonstop premium increases on Obamacare even before it became possible to pass it.

        • AngryWarthogBreath

          This is just one reason I think there should be a global autocorrect, even on people’s voices, to replace the words “the market” with “assholes”.

          “Reading the will of assholes, we’ll have to raise rates.”
          “It’s not practical to hire more workers at this point, with the predicted fluctuations in assholes.”
          “Assholes will take care of that problem.”

          It works just about every time!

  • I think I get it now:

    1. Republicans repeal the ACA without a plan to replace it.
    2. 36 million people get tossed off health insurance.
    3. The resulting wave of anger turns both sides of Congress over to the Dems in 2018.
    4. The Dems spend 2 years trying to put together a plan that Trump will sign.
    5. Anger at the inability of the Dems to do so causes a wave that reelects Trump and turns Congress back over to the Republicans.
    6. Trump gets to put 2-3 more arch-conservative judges on the Supreme Court.
    7. Koch brothers use this as the opportunity to push legislation making them co-rulers of the U.S.
    8. The Supreme Court rules this as constitutional.
    9. Game over.

    • mds

      Why would the Kochs bother with #7, since by #6 it would be de facto true already?

  • DKOSullivan

    These articles are just giant exercises in begging the question, that question typically being “And does the republican plan actually do the thing you’re advocating for?” Ponnuru is basically saying that he thinks the government should kick everyone off medicaid and giving them government subsidies to buy insurance (though I’m probably being too generous to Ponnuru here). If Free Market Uber Alles types want to have the argument that people on meidicaid are better off on private insurance then fine, but you’d have to spend MORE money per person giving them subsidies to buy adequate insurance, and you’d have to have community rating and guaranteed issue to ensure they could insure themselves. Oh, and you’d have to create a central system where everyone could compare plans to make sure they were getting what they want. In other words, it would look an awful lot like Obamacare

    If the FMUA types would be satisfied with an ACA that basically put everyone in America on the exchanges that’s a deal I could see making. Yes it would be a massive giveaway to insurance companies, and drive up the cost of the ACA since Medicaid is actually way more efficient than private insurance, but it would be worth it to make sure everyone in America was covered.

    But they won’t be satisfied with a deal because the point isn’t to make sure everyone in America is covered under the best possible insurance (as Ponnuru implies), nor to make America’s healthcare system more like Singapore’s (as Avik Roy gestures at), or even to make sure everyone has coverage (as Tom Price’s infographics suggest). The point of these articles and arguments is to provide intellectual cover for republicans to take healthcare away from the poor and middle class to finance a minor tax cut for the wealthy without anyone accusing republicans of taking healthcare from millions so some millionaire can buy another maserati he’ll never drive.

  • gwen

    As I noted elsewhere, Medicaid is a bad program that should be replaced with something better (i.e. glorious single-payer). Making Medicaid worse just sort of underscores that.

  • Damon Poeter

    ‘I’d hate to see the “extreme” version.’

    Poisonous food stamps that kill you when you lick them.*

    *Ramesh does not know how food stamps actually work … when asked, Jonah farted twice to express his support for the idea

  • afdiplomat

    I am waiting for an inquiring interviewer to ask Ponnoru, or Roy, or Blahous, something like the following: “You realize we’re not playing checkers here; what’s at issue is whether tens of millions of people will suffer enormously in their bodies and minds, and whether some thousands of them will die early. With all that at stake, how can you keep putting your name to arguments you are too smart to believe that are intended to justify taking hundreds of billions of dollars from people with very little to give to those who are already well off? Doesn’t it bother you to make your income that way?”

    These people are not stupid — at least not in the IQ sense of that term. They may have become ideologically idiotic, but that’s not an organic condition. I can’t imagine that Ponnoru is unable to see in his own arguments the problems that Scott Lemieux describes. So what makes him do this kind of atrocity regardless, rather than finding some honest way to make a living? Somebody really needs to ask that question; there’s real enlightenment about a certain kind of evil to be gained.

  • stonetools

    Looks to me at this point that even the best efforts of conservative shilldom just aren’t working. Roy, McArdle and now Ponnuru simply haven’t moved the needle much. Recent polling shows th bill is still incredibly unpopular,so it looks like truth is still winning out, so far. Still is more likely than not the Republicans will pass something, though.

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