What One Writer Got Wrong When Attacking An Obamacare Critic

Faithful readers of Rick Ungar--the self-described "token lefty" in Forbes' stable of contributors--may have read last week his provocative piece titled "GOP Senator Knowingly Distorts GAO Report He Commissioned To Launch Most Dishonest Attack On Obamacare To Date." So now you know the "rest of the story" as it relates to how I titled today's post. There appeared to be no holds barred in Mr. Ungar's astonishing attack on Alabama Senator Jeff Sessions, the ranking minority member of the Senate Budget Committee (someone who you might have thought been deserving of a tad more respect than Mr. Ungar saw fit to accord). Indeed, by the time he was done, Mr. Ungar had concluded that Senator Sessions is unfit for public office!

In fairness, Mr. Ungar was merely one of many progressive voices shrieking in dismay at the claim that Obamacare appears destined to add $6.2 trillion to the deficit over the next 75 years.   In today's issue of The American, I have provided a much more extensive and detailed critique of the distortions fomented by these ardent defenders of the new health care law. Providing a blow-by-blow rebuttal to the many distortions contained in Mr. Ungar's unrelenting attack on Senator Sessions would be duplicative and counterproductive. What I would like to do instead is respond to a few key points to illustrate just how hypocritical Mr. Ungar's accusations of dishonesty are from a more neutral perspective. To avoid rehashing all the arguments he has made, I encourage readers to first read his diatribe and then return here to better understand how off-base it is.

Let me concede up front that I am not privy to Mr. Ungar's thoughts: it's at least possible that Mr. Ungar did not "knowingly" distort any facts. His apparent truth-twisting may instead arise from his own ignorance; if so, he would do well to steer clear of matters on which he is not qualified to render judgment. At minimum, I would say he owes Senator Sessions an apology, but I encourage readers to judge this for themselves based on my comments here and my longer piece.

Is $6.2 Trillion a "Reasonable" Estimate of the Deficit Increase Produced by Obamacare?

Mr. Ungar starts by asserting that the Senator's claim that his finding is based on ‘a realistic set of assumptions’ is "at the very heart of Senator Sessions’ extraordinary deception—one designed to purposefully and cynically mislead the American public."  "Despicable and cowardly" were other terms Mr. Ungar tossed into the mix. That's awfully strong language coming from someone who either is engaged in a great deal of truth-twisting himself or simply does not know what he's talking about.

What's particularly odd is that Mr. Ungar himself offers the evidence that Senator Sessions' $6.2 trillion estimate actually is quite reasonable. He offers us a direct quote from Charles Young, a spokesperson for the GAO, which had authored the report from which the $6.2 trillion deficit increase had been calculated:

We did not (emphasis added) make such an estimate. There are a number of different reasonable methods one could use that would result in a variety of different estimates. This is one such calculation.

Mr. Ungar is so preoccupied with demonstrating that Senator Sessions fabricated a phony estimate--rather than literally lift the $6.2 trillion figure from the GAO report--that he apparently overlooks the plain meaning of Mr. Young's statement. No, the GAO did not make this dollar calculation itself. However, the calculation--which was actually performed by Senate Budget Committee staff using the GAO's own numbers--was one of a number of reasonable methods by which one could estimate Obamacare's net impact on the deficit. Mr. Young assuredly did not claim it was a bogus figure entirely lacking in validity, as a reader of Mr. Ungar's rant might conclude.

As I pointed out in a comment on Mr. Ungar's blog, the independent, nonprofit, nonpartisan Committee for a Responsible Federal Budget has stated: “It’s easy to say that the alternative fiscal scenario is probably a lot closer to where we are going, even if it has some flaws.” The lion's share of Mr. Ungar's post is devoting to ridiculing the assumptions underlying a budget scenario that CRFB believes is much closer to the truth than the fantasy scenario preferred by Mr. Ungar and other Obamacare enthusiasts. In short, what Mr. Ungar claims is a "worst-case" scenario actually is much closer to a "most likely" scenario. So who's being dishonest?

Did Senator Sessions Ask GAO To Cook the Books?

The most egregious charge--and quite flagrantly false--is that Senator Sessions "gave directions requiring her [the GAO study's lead staffer] to ignore any reasonable assumptions with respect to the revenue and cost bending provisions of the law."  What Mr. Ungar quite obviously does not understand is that the alternative fiscal scenario--the one that Mr. Ungar sneeringly assures us is "a pretty foolish way to conduct a serious study"--is standard practice among federal agencies. The Congressional Budget Office has used it for years (dating back at least to the Bush administration), the Medicare and Social Security Trustees use it, the Medicare actuary uses, the Department of Treasury uses it (this is all codified/detailed in my longer report). Even the GAO itself has used this alternative fiscal scenario in the past--a point freely conceded by Jonathan Chait (in a post cited admiringly by Mr. Ungar!)

Rachel Maddow had the decency to retract the same false claim on her blog, as did Bonnie Kavoussi (a little less snarkily) at The Huffington Post. Mr. Ungar meanwhile, clings bitterly to the belief that Senator Sessions handed GAO a set of completely cock-eyed assumptions and that GAO dutifully set about cranking out completely meaningless calculations.

Instead, Mr. Ungar might be quite surprised to learn that the Medicare actuary has been signalling for years that the cost containment provisions in Obamacare may not hold up. The rationale is nicely codified here in a memo written in May 2012, but the same argument was made in parallel memos from 2010 and 2011 (i.e., long before Senator Sessions made his request of GAO). And contrary to Mr. Ungar's fact-challenged account, the reason is not because analysts assume the cost containment provisions will literally fail. It's because the consequences of keeping them in force will be far too draconian for even progressives to view as desirable.  Therefore Congress is likely to relax these provisions after 2020, just as they have repeatedly relaxed the legally required cuts in physician fees on more than a dozen occasions since 2003.

According to the Medicare actuary (in the same memo just cited), the Obamacare payment formula will eventually lead to payment reductions to hospitals that are so steep that hospitals will end up being paid 61 percent less by Medicare and Medicaid than by private health insurers; physicians eventually will be paid 74 percent less under Medicare than private insurance.  In short, Obamacare portends provider payment cuts far more severe than the 26.5% cut in Medicare physician fees that would have gone into effect this past January 1 had Congress not stepped in with a provision in the fiscal cliff law to postpone this cut (again!) for another year. Yet progressives would have you believe it is more reasonable to believe that Congress will stand idly by as these devastating cuts take their toll than to believe they will rescue hospitals, physicians and other providers in the identical fashion that they have spared doctors in the past.

Challenge

I have a challenge for Mr. Ungar and like-minded progressives. If you truly believe that hospitals deserve to be paid 61 percent less for their Medicare and Medicaid patients than for those with private insurance and that doctors deserve to be paid 74 percent less for their Medicare patients than if they have private coverage, please state your case and defend it. Do you truly believe that American hospitals and doctors are so overpaid that cuts of that magnitude are warranted? And even if you believe they are warranted, do you honestly believe that such massive reductions in payment levels will have zero impact on the ability of Medicare and Medicaid patients to obtain care?

Those who claim that Obamacare will reduce the deficit in the long run are implicitly claiming that the stunningly severe cuts I have just described can and will be implemented. Or perhaps they are hoping that providers will magically be spared such cuts when the Obamacare tooth fairy arrives to save the day. I myself don't believe such cuts can be justified, nor in the tooth fairy for that matter. Mr. Ungar, of course, is welcome to believe whatever he likes. I'd just prefer that he share his views on health policy with a little less bombast and a little more humility. And perhaps he can even show us all he's a stand-up guy by offering Senator Sessions the apology he's due.