Regardless of how the Supreme Court ruled, the Patient Protection and Affordable Care Act (ACA) is unconstitutional in spirit if not in fact. Questionable legislative maneuvers, chicanery in costing, an absence of debate or discussion, and questionable agreements with outside interests all played key roles in getting this bill passed. The result was 2700 pages of contradictory and vague legislation. Conceived in secrecy, the bill didn’t see the light of day until just 2 days before the vote. There is doubt that even its creators ever read it entirely. Is this what the founders had in mind when they gave Congress the power to “make Laws which shall be necessary and proper” ? Is this what we had in mind when we asked Congress to make health care more affordable?
Let’s take a look at the devices used to pass this bill. In light of the record-breaking crushing debt that we’re struggling under, the deceptions used to hide the true cost of the bill must be discussed first.
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First of all, the cost of 6 years of health care benefits was spread out over the next 10 years. Not coincidentally, The Congressional Budget Office (CBO), charged with projecting the cost of legislation, calculates large bills in 10 year increments. This alone lowered the cost of the bill considerably. But we’re just beginning.
Another ploy lowered the bill’s estimated cost by double counting a whopping $500 billion. This amount supposedly would be removed from Medicare spending to pay for ACA spending, presumably reducing the cost of the ACA by $500 billion. However, the same $500 billion was subtracted from the ACA cost again because “saving” that much money extended the life of Medicare. Incredibly, it shouldn’t have been used as a cost saver at all. Richard Foster, Medicare’s own chief actuary, warned Congress before the bill was complete that Medicare couldn’t adequately cover senior health care with that large of a cut.
Spreading the cost of 6 years of health care benefits over 10 years and counting $500 billion in cost ‘savings’ twice are the two most well known of the accounting tricks used to pass the health care reform bill. There are many more.
One of the worst of these called for a long term care program, Community Living Assistance Services and Supports Act (CLASS). Beneficiary payments were to be collected for the first 10 years before any benefits could be claimed. These payments, estimated at tens of millions of dollars, were subtracted from the total cost of the bill. After the bill was passed, actuaries pointed out what the framers must have known, that the plan would be unsustainable and, unless revoked, would bankrupt the country. Last October, Health and Human Services (HHS) admitted as much and it was put ‘on hold,’ but not before its phantom premium payments were used to lower the cost of the ACA.
Another incredibly duplicitous ploy involved “doc-fix“. This is a feature of the 1997 Balanced Budget Act that, given certain circumstances, calls for a yearly reduction in the Medicare reimbursement rates paid to doctors. Realizing that these reductions would jeopardize the availability of medical services to seniors, Congress systematically rescinds the reduction each year it is called for. The ACA, however, was written with the assumption that this reduction, calculated at 21%, would continue to take place. This was done despite the fact that a doc-fix bill to again rescind the reduction was already being readied for passage once the ACA passed. As a result, 21% of the projected cost of doctor’s fees, among the largest of Medicare costs, was subtracted from the cost of the ACA with full knowledge that the amount would be added back in after the bill passed.
Another sleight of hand trick was to ignore the private sector costs resulting from the bill’s mandates. Private sector costs… that’s what comes out of our pockets. The Clinton health care legislation was soundly defeated because of the high price tag resulting from honestly including private sector costs. Those costs accounted for fully 60% of the total!
Here’s another example of trickery, or just poor formulations. Respected economists Doug Holtz-Eakin, former CBO director, and Eugene Steuerle of the Urban League, have pointed out a miscalculation that underestimates the cost of government health care subsidies in the ACA by 300%! They see many more employees replacing their employer’s health care plans with ones subsidized by the government. They also see many more employers dropping their health care benefits and forcing employees into subsidized government plans. If they’re right, and more and more analysts are agreeing with them, this would triple the CBO’s estimate for the government’s cost to provide health care subsidies, adding at least another $200 billion a year to the cost of the bill.
Under the ACA, Social Security benefits no longer will be counted as income to qualify beneficiaries for Medicaid, the government’s free health care system for the poor. As a result, millions more people will be eligible for government provided benefits. The bill assumes 3 million people will be thus affected. However, an expert on the subject, Richard Foster, Medicare and Medicaid Chief Actuary, says the number is closer to 5 million, adding another huge amount to the real cost of the legislation.
Perhaps the most egregious cost issue is the number of unknowns in the bill. The Congressional Research Service (CRS), a non-partisan analytical arm of the government, says the true cost of the bill is unknowable. The exact number of new agencies, boards and commissions that will be created by the bill can never be determined because of the vagueness of the text, the power of HHS to create new ones, and the number of “to be determined” items referenced in the bill. The cost, according to the CRS, is literally impossible to calculate. So, even more, lots more, could be added to this bill’s tab over the years.
Right now, the CBO estimates the current cost of the bill at $1.76 trillion for the next 10 years; but its original 10 year estimate, just 2 years ago, was $940 billion, a huge $820 billion difference. How could they make such a huge mistake? The problem is the CBO operates under strict restraints in estimating the cost of legislation. It must accept what’s stated in the bill and estimate accordingly. Even when it’s obvious that assumptions are improbable, it’s bound to accept them. Knowing this, Congress can craft bills in ways that hamstring honest estimates. And this bill had to be under a trillion dollars just long enough to pass into law. The only thing that protects the public from bad legislation is debate and discussion in Congress and the posting of bills so they can be carefully read and evaluated. This never happened with the 2700 page ACA bill.
By the way, economists, unencumbered by the constraints under which the CBO operates, have estimated the real cost of our health reform bill at $2.4 trillion!
If the true cost of the ACA were known, it would never have passed. And the low-balled cost of the bill is only one of the many perfidious means used to get it passed. The U.S. Constitution, the document that defines our government, is the oldest constitution of any major country in the world today. But our country can not prosper or even survive if bills like the ACA are passed.