Tuesday I wrote about the GOP’s systematic efforts to discredit and disempower any independent voice — media, the Congressional Budget Office, the Office of Government Ethics — that tries to hold government accountable.
Today we have a great example of the ridiculous propaganda that Republicans expect the public to swallow in the absence of such independent critics and scorekeepers.
The Washington Examiner has gotten its hands on a Trump administration “analysis” (I use that word loosely) of the Consumer Freedom Amendment, a proposal from Sen. Ted Cruz (R-Tex.). This amendment to the possibly-now-defunct Senate health-care bill would allow insurers to sell individual market plans that meet none of Obamacare’s health insurance standards and quality floors, so long as those same insurers also sell some plans that do.
Talk to literally any economist, including conservative ones, and you’ll learn that this idea would lead to adverse selection, a huge spike in premiums for sick people (who would sort into the Obamacare-compliant plans), a proliferation of mini-med junk plans that cover virtually nothing (which would attract the healthier people), and a possible death spiral. A more detailed explanation of this phenomenon is here.
The nonpartisan Congressional Budget Office would normally be tasked with assessing the impact of such a proposal, on both the federal budget and health insurance markets: coverage rates, premiums, etc. Last week, however, Sen. John Thune (R-S.D.) suggested that there might not be sufficient time for the CBO to score the bill before Republican leadership’s artificially short deadline.
Thune thus proposed the unprecedented strategy of cutting the CBO out of the bill-scoring process entirely. Instead, he suggested, Republicans could just use an analysis to be crafted by either the Department of Health and Human Services or the Office of Management and Budget — i.e., the White House.
Which, unlike CBO, has a dog in this fight. As is completely clear from the pseudo-analysis that the Examiner obtained.
Contrary to the predictions of economists everywhere, the HHS propaganda document claims that the Cruz amendment would cause insurance coverage to go up and premiums to fall. Astoundingly, even premiums for people in the Obamacare-compliant plans — which, again, economic theory suggests would get stuck with only the very sickest, most expensive Americans — would allegedly decline relative to current law. (Compare “2020 Current Law Enrollment Weighted Average” to “2020 Silver ACA Compliant” in the chart below.)
This is garbage, and exactly why we need nonpartisan scorekeepers like the CBO.
How did HHS come up with these estimates? Hard to say, since the model uses “proprietary elasticity estimates.” That’s a fancy phrase meaning: “We refuse to tell you what ridiculous numbers we plugged in. Also we may use different numbers representing the same thing in different equations and just not tell you.”
Undergrads could produce more serious work than this. Of course, undergrads generally aren’t allowed to start out with the answer they want and then backfill all the relevant assumptions in their model.
“One way or another, this amendment is going to lower premiums and make people better off,” a source close to Cruz told the Examiner.
Hmm, where have I heard this kind of thinking before?