The Reason Democrats Think ObamaCare is Working

On March 9th the Congressional Budget Office (CBO) released its latest budget projections which included updated estimates for ObamaCare.

If you were to believe what has been written by the vast majority of the mainstream media reporting on the findings contained in the CBO report, you would in fact think that ObamaCare is a grand success.  For example:

 

LA Times Article starts  -  Five years after Obamacare became law, the projected costs continue to tumble, according to the nonpartisan report released Monday.

Costs of providing healthcare under the Affordable Care Act are projected to be almost one-third less than what had been anticipated by the Congressional Budget Office in 2010.  By 2019, the costs are expected to be 33% less than forecast.

CNBC article starts  -  Going down: CBO says Obamacare costs set to fall  -  The sky actually wasn’t falling when Obamacare began, but its costs apparently are now.

Congressional Budget Office on Monday said it expects the federal government will spend significantly less on Obamacare than had been projected.

The Washington Post article starts  -  Obamacare’s projected cost falls due to lower premiums under health care law.  CBO says  -  The estimated cost of President Obama’s signature health care law is continuing to fall.

 
Here lies the problem that has surrounded President Obama’s signature healthcare legislation since before it became a law. 

There is no denying that mainstream news agencies are overwhelmingly left leaning however, what most on the left fail to realize, or maybe choose to ignore, is that most of these agencies have chosen to compromise journalistic integrity in order to protect a liberal/progressive ideology.  More so, these same news sources willfully take advantage of reader/viewer apathy which allows them to spin facts unchecked.  Nothing could be a finer example of how the liberal media protects their ideology than how they report on ObamaCare!

Let’s take an article from the more conservative Washington Times (WT), published at the same time and on the same subject matter as the above mentioned articles for example.

The opening paragraph of the WT article is in sharp contrast to those shared above in pointing out one of the major pitfalls that consumers of ObamaCare will soon have to face:

Obamacare exchange customers are about to see spikes in their premiums, the Congressional Budget Office predicted Monday, saying insurers that offer plans are facing twin pressures from the government and the marketplace that will mean hikes of more than 8 percent a year through 2018.

The article does not however explain the reasons behind the forthcoming spike in premiums so the revelation will be passed over by readers without a thought.  As for the reasons, they will be addressed in a moment.


The third paragraph in the WT article goes on to promote enrollment on the exchanges during the second open enrollment period:

Nearly 11.7 million Americans bought plans on the exchange in the second enrollment period, Health and Human Services Secretary Sylvia Mathews Burwell announced Monday afternoon, hours after the CBO’s analysis was released.

What this paragraph fails to mention is the make-up of the 11.7 million.  As well, if this is a verbatim quote from Burwell, she is misrepresenting the figure which accounts for the number of Americans included on plans that have been “selected” and by no means accounts for the number of plans that have actually been purchased and paid for.  Here is a better look at the make-up of those 11.7 plans selected:

Total plans selected (2015 open enrollment period)  11.7 million
Plan renewals (from 2014)                                         5.9 million
Attrition (as projected by HHS)                                   1.0 million
Known transfers (from other marketplaces)                2.5 million
Plans purchased by uninsured                                2.3 million

That’s right, only 2.3 million uninsured showed up to the ObamaCare exchanges to purchase a qualified healthcare plan in 2015.  The balance of the 11.7 million who enrolled through the ObamaCare exchanges were already insured or will fall to attrition.  That 11.7 million does not look so impressive now does it, and why aren’t all the enrollment figures reported?


The following couple of paragraphs, from the WT article, address premiums but are not very forthcoming in explaining why premiums are expected to rise so sharply:

The CBO said premiums for the key “benchmark” exchange plans will rise an average of 8.5 percent per year from 2016 to 2018, faster than the rest of the health care market.

The budget analysts said part of the reason is that the plans offered now are narrower than private plans and reimburse providers at lower rates. They said both trends probably will change, forcing insurers to raise premiums.
           

You may or may not recall, but at the close of the 2014 open enrollment period, using similar models to what insurance companies use, industry experts warned of skyrocketing premiums heading our way in 2015.  The projected increases were due mainly to an unexpectedly low turnout of the uninsured {1.4 million} which insurers were counting on as new customers.

The news of skyrocketing rates sent a shockwave through the White House and had both the Department of Health and Human Services (HHS) and the president scrambling to do damage control as well as to come up with a fix.  Damage control was easy, simply float a story that the claims are skyrocketing premiums was drummed of by republicans, the fix on the other hand was a bit more difficult and required negotiation directly between insurers and the president.

Fearing a stronger pushback by republicans to repeal his signature healthcare law, the president pleaded with insurers to hold down 2015 premiums and in exchange he gave his assurance that they would be compensated for any losses realized by doing so.  Insurers did the best they could in holding premiums down for 2015 by pushing their risk to the ragged edge as well as passing on a portion of the increases to plan deductibles.

But with another low turning of the uninsured during the 2015 open enrollment period, the CBO recognized that insurers will have no choice but to start raising premiums especially since the risk-corridors provision will end at the close of 2016 at which time insurers will no longer have any protection from losses.

If the CBO projections stand, this will mean a five year string of rate increases to the individual healthcare insurance marketplace that surpasses the increases that were being realized in the marketplace pre-ObamaCare.

In the next paragraph of the WT article makes the point of health care costs being lower than expected, as reported by the CBO, but provides no explanation as to why:

Overall, the CBO said, health care costs for the government and for private consumers are lower than expected just a few years ago. That means Obamacare is less expensive than predicted when the Affordable Care Act was enacted in 2010, though it’s covering fewer Americans than President Obama hoped.

The last sentence of this paragraph tells most of the story.  Of course the projected cost of ObamaCare is going down, far fewer have signed up for the healthcare law than originally projected meaning that fewer people will be receiving subsidize.   But there is more to the lower cost than just low enrollment, the other part of the equations is ‘who' is signing up.

The make-up of the pool of people purchasing qualified healthcare plans through the ObamaCare exchanges is significantly different than what was originally projected during the crafting of the law.  Contributing to the lowered cost the most is the low turnout of the uninsured, a group which was anticipated to be highly subsidized.  With participation of this uninsured group being only one third that of what was originally projected, the drop in the amount of subsidies being paid out is significant. 

The much larger group that is purchasing healthcare insurance through the ObamaCare Exchanges is a group of individuals that were previously insured and transferred over from another marketplace.  This group is three fold larger than projected and on average, consumes significantly less subsidies again lowering the overall cost of ObamaCare.

The slower growth rate in the cost of health care has also attributed to the lower cost of ObamaCare however, the slowdown has been linked to the recession and slow economic recovery and has little if anything to do with ObamaCare, a fact that the CMS actuary agrees with.

In truth, the lower cost of ObamaCare being reported is an admission of failure as it is driven primarily by low uninsured participation and a much higher transfer rate of the already insured than projected.


The very next paragraph of the WT article pretty much sums up the reason for the misconception that ObamaCare is working by those more inclined to take the word of our government officials than question them:

Ms. Burwell said the law is working as intended, and she urged the Supreme Court not to invalidate the way the administration pays subsidies. Cutting off the tax payments would harm millions of Americans who “need, want and like” the plans they’ve bought, she said.

“The simple truth is that millions of Americans in all 50 states rely on the Affordable Care Act for tax credits to buy insurance,” she said.

Is the law really working as intended?  Not by a long shot.

A full year after ObamaCare was passed into law, the house subcommittee of the Health Committee on Energy and Commerce held a congressional hearing, a part of which included written testimony from the CBO in the form of a report on the effects of ObamaCare. 

In the summary of the report, the CBO including the following estimates as to the effect ObamaCare was projected to have on healthcare coverage once fully implemented:

CBO and JCT estimate that PPACA and the Reconciliation Act will increase the number of nonelderly Americans with health insurance by about 32 million in 2016 and about 34 million in 2021. About 95 percent of legal nonelderly residents will have insurance coverage in 2021, compared with a projected share of about 82 percent in the absence of that legislation (and an estimated 83 percent currently). In 2021, approximately 24 million people will purchase their own coverage through insurance exchanges, and Medicaid and the Children’s Health Insurance Program (CHIP) will have roughly 17 million additional enrollees, CBO and JCT estimate.

 

 
The estimates provided in this CBO report {see table 3} fall close in line with their earlier analysis of which were used by the crafters of the law to sell the law to other congressional democrats.

That’s right, at the time ObamaCare was sold to the American people it was projected that the number of uninsured Americans would fall by 32 million by year 2016, just one year away.  So, where are we now?

As of December 2014, 10.8 million individuals had gained healthcare coverage through the Medicaid expansion, as reported by HHS, and after two full open enrollment periods the number of uninsured Americans that obtained a qualified healthcare plan through the ObamaCare exchanges number well under 4 million.  With a reduction of the uninsured fewer than 15 million, that puts a great deal of pressure on the already struggling law to reach the 32 million mark by the close of next year’s open enrollment period.  And the biggest deterrent keeping the uninsured away is cost. 

Affordability still remains as elusive to individual healthcare insurance plans as transparency is to the Obama Administration.  In fact, cost has been such a large deterrent that one of the groups ObamaCare was supposed to help the most, those with a high cost/high risk pre-existing medical conditions, have been largely locked out from obtaining healthcare insurance.


In reading such articles as posted by the LA Times and the Washington Post, is it any wonder why democrats and other proponents of ObamaCare believe the law is working?  Why wouldn’t they, these left leaning news sources have spun the latest CBO projection’s in such a manner that it makes the law sound like it is over performing.  But such is not the case as has just been revealed. 

Complete and factual reporting on the projections portrayed in the most recent CBO report are literally non-existent in most of the media reporting and the similarities in the fluff pieces published by these news sources is mind boggling.  Liberal news agencies cannot shoulder all the blame for providing sub-standard reporting however as it is the apathy of the people that has for decades allowed them to continually lower the bar of journalistic integrity as well as has allowed them to engage in agenda based instead of fact based reporting.