Crossroads GPS: “Vision” CA-21

In identical ads hitting congressional candidate John Hernandez (D-CA) and three other Democratic House candidates in Illinois, Indiana, and Michigan, Crossroads GPS levels a series of falsehoods about the Affordable Care Act, which all four candidates support. Despite the ad’s claims, the health care law reduces future Medicare spending without cutting seniors’ current benefits, it helps control rising costs, and it’s expected to expand insurance coverage – all without taking health care decisions away from individuals or raising taxes on most Americans.

Affordable Care Act Savings Do Not ‘Cut’ Medicare Benefits

Affordable Care Act Reduces Future Medicare Spending, But “Does Not Cut That Money From The Program.” According to PolitiFact: “The legislation aims to slow projected spending on Medicare by more than $500 billion over a 10-year period, but it does not cut that money from the program. Medicare spending will increase over that time frame.”  [PolitiFact.com, 6/28/12]

  • CBO’s July Estimate Updates Medicare Cost Savings To $716 Billion. According to the Congressional Budget Office’s analysis of a bill to repeal the Affordable Care Act, repeal would have the following effects on Medicare spending: “Spending for Medicare would increase by an estimated $716 billion over that 2013–2022 period. Federal spending for Medicaid and CHIP would  increase by about $25 billion from repealing the noncoverage provisions of the ACA, and direct spending for other programs would decrease by about $30 billion, CBO estimates. Within Medicare, net increases in spending for the services covered by Part A (Hospital Insurance) and Part B (Medical Insurance) would total $517 billion and $247 billion, respectively. Those increases would be partially offset by a $48 billion reduction in net spending for Part D.” [CBO.gov, 8/13/12]

GOP Plan Kept Most Of The Savings In The Affordable Care Act. According to the Washington Post’s Glenn Kessler: “First of all, under the health care bill, Medicare spending continues to go up year after year. The health care bill tries to identify ways to save money, and so the $500 billion figure comes from the difference over 10 years between anticipated Medicare spending (what is known as ‘the baseline’) and the changes the law makes to reduce spending. […] The savings actually are wrung from health-care providers, not Medicare beneficiaries. These spending reductions presumably would be a good thing, since virtually everyone agrees that Medicare spending is out of control. In the House Republican budget, lawmakers repealed the Obama health care law but retained all but $10 billion of the nearly  $500 billion in Medicare savings, suggesting the actual policies enacted to achieve these spending reductions were not that objectionable to GOP lawmakers.” [WashingtonPost.com, 6/15/11, emphasis added]

  • McDowell’s Opponent, Rep. Benishek, Voted To Keep The ACA’s Medicare Savings. Along with 234 other House Republicans, Rep. Dan Benishek voted “yea” on the House Republican budget. [H.Con. Res. 34, Vote #277, 4/15/11]

IPAB Is Tasked With Finding Additional Savings, But Is Forbidden From Cutting Benefits

Although GPS does not provide a citation for its assertion that the health care law “could allow 15 unelected bureaucrats to make health care decisions for Michigan seniors,” that language commonly refers to the Independent Payment Advisory Board created by the Affordable Care Act.

ACA Establishes An Independent, Senate-Confirmed Board (IPAB) To Find Additional Savings. As explained by the Kaiser Family Foundation: “The 2010 health reform law (the Patient Protection and Affordable Care Act, also referred to as the ACA) establishes a new Independent Payment Advisory Board (IPAB) with authority to issue recommendations to reduce the growth in Medicare spending, and provides for the Board’s recommendations to be considered by Congress and implemented by the Administration on a fast-track basis. […]As authorized by the health reform law, IPAB is an independent board housed in the executive branch and composed of 15 full-time members appointed by the President and confirmed by the Senate. [Kaiser Family Foundation, April 2011]

IPAB Proposals Will Be Implemented Unless Congress Finds Alternative Savings Or Supermajority Overturns Them. According to the Washington Post: “Beginning with fiscal 2015, if Medicare is projected to grow too quickly, the IPAB will make binding recommendations to reduce spending. Those recommendations will be sent to Capitol Hill at the beginning of each year, and if Congress doesn’t like them, it must pass alternative cuts — of the same size — by August. A supermajority of the Senate can also vote to amend the IPAB [spending] recommendations. If Congress fails to act, the secretary of Health and Human Services is required to implement the cuts by default.” [Washington Post, 5/8/11]

IPAB Cannot Recommend “Changes In Premiums, Benefits, Eligibility And Taxes.” According to the Kaiser Family Foundation: “The Board is prohibited from recommending changes that would reduce payments to certain providers before 2020, and is also prohibited from recommending changes in premiums, benefits, eligibility and taxes, or other changes that would result in rationing.” [Kaiser Family Foundation, April 2011]

  • PolitiFact: “The Law Specifically States That The Board Cannot Ration Care.” According to PolitiFact, “Actually, the law specifically states that the board cannot ration care. The board doesn’t look at individual patients or deny individual treatments. Instead, it makes system-wide recommendations to rein in the future growth of Medicare spending, and it makes those recommendations within limited parameters. It also was created to stop runaway spending growth within the Medicare program itself, not to divert money to other budget items.” [PolitiFact.com, 3/12/12]

Affordable Care Act Does Not Raise Taxes On Most Americans – And Includes Tax Credits For Millions

Affordable Care Act “Will Provide More Tax Relief Than Tax Burden” For Middle Class. According to the Washington Post fact checker Glenn Kessler: “The health law, if it works as the nonpartisan government analysts expect, will provide more tax relief than tax burden for middle-income Americans.” [WashingtonPost.com, 7/6/12]

FactCheck.org: “A Large Majority Of Americans Would Not See Any Direct Tax Increase From The Health Care Law.” According to FactCheck.org: “It’s certainly true that the health care law would raise taxes on some Americans, particularly those with higher incomes. The law includes a Medicare payroll tax of 0.9 percent on income over $200,000 for individuals or $250,000 for couples, and a 3.8 percent tax on investment income for those earning that much. The Joint Committee on Taxation estimated that the biggest chunk of revenue — $210.2 billion — comes from those taxes. There are other taxes in the health care law — including an excise tax on the manufacturers of certain medical devices and on indoor tanning services. The health care law included $437.8 billion in tax revenue over 10 years, according to the Joint Committee on Taxation‘s calculations. Republicans tend to add in fees on individuals who don’t obtain health insurance (which the Supreme Court now agrees can be considered taxes) and businesses that don’t provide it to bump that up to about $500 billion. Some taxes, such as those on medical devices, may or may not be passed on to consumers in the form of higher prices, but a large majority of Americans would not see any direct tax increase from the health care law.” [FactCheck.org, 6/28/12]

  • Individual Penalty Payments “Tiny” Compared To President Obama’s Previous Tax Cuts. According to FactCheck.org, the increased revenue from penalty payments by individuals who do not obtain health insurance represents “a tiny future increase compared with the tax cuts Obama has already delivered, including an estimated $120 billion in 2012 alone from the 2 percentage point cut in payroll taxes.” [FactCheck.org, 5/17/12]

Affordable Care Act Includes Tax Credits For Millions Of Americans. According to Families USA: “We found that an estimated 28.6 million Americans will be eligible for the tax credits in 2014, and that the total value of the tax credits that year will be $110.1 billion. The new tax credits will provide much-needed assistance to insured individuals and families who struggle harder each year to pay rising premiums, as well as to uninsured individuals and families who need help purchasing coverage that otherwise would be completely out of reach financially. Most of the families who will be eligible for the tax credits will be employed, many for small businesses, and will have incomes between two and four times poverty (between $44,100 and $88,200 for a family of four based on 2010 poverty guidelines).” [FamiliesUSA.org, September 2010]

Rising Health Care Costs Are Due To Market Forces, And Are Slowed By ACA

Rising Health Care Costs Are Part Of A Long-Term Trend. The following chart from CNNMoney illustrates  increasing health care costs between 2002 and 2011:

cnn-health-costs16

[Money.CNN.com, 5/11/11]

Without ACA, Health Care Costs Would Rise Even Faster. From CNNMoney: “The individual mandate would help spread health care costs to a larger pool of individuals, thus potentially lowering costs. Should the Supreme Court strike down the Affordable Care Act, consumers can expect that percentage to increase even more as costs rise ‘very fast,’ [Mathematica Policy Research senior fellow Deborah] Chollet said. Without the law’s measures to promote preventative care and spread costs across a larger population, overall costs will rise, she explained. Those without employer-provided health care coverage … will likely pay more for their plans because there will be fewer restrictions on insurers. Individuals could be denied coverage altogether because of a pre-existing health condition or offered coverage only at a very high premium, both of which are prohibited under the Affordable Care Act, Chollet added. Those with insurance through their employer will also pay more to cover the growing number of uninsured, she said.” [Money.CNN.com, 3/29/12]

Conservatives Distort CBO Expectations To Fearmonger On Lost Coverage

Up To 30 Million People Are Expected To Gain Coverage Through The Affordable Care Act. From the Congressional Budget Office: “CBO and JCT now estimate that the ACA, in comparison with prior law before the enactment of the ACA, will reduce the number of nonelderly people without health insurance coverage by 14 million in 2014 and by 29 million or 30 million in the latter part of the coming decade, leaving 30 million nonelderly residents uninsured by the end of the period. … The share of legal nonelderly residents with insurance is projected to rise from 82 percent in 2012 to 92 percent by 2022. According to the current estimates, from 2016 on, between 23 million and 25 million people will receive coverage through the exchanges, and 10 million to 11 million additional people will be enrolled in Medicaid and CHIP as a result of the ACA. Between 4 million and 6 million fewer people are estimated to have coverage through an employer, compared with coverage in the absence of the ACA. That number did not change significantly as a result of the Court’s decision.” [CBO.gov, July 2012]

Affordable Care Act Projected To Cause Small Reduction In Employer-Based Coverage, But Could Also Increase Such Coverage. From the Congressional Budget Office: “CBO and JCT continue to expect that the ACA will lead to a small reduction in employment-based health insurance. […] In CBO and JCT’s judgment, a sharp decline in employment-based health insurance as a result of the ACA is unlikely and, if it occurred, would not dramatically increase the cost of the ACA. […] As reflected in CBO’s latest baseline projections, the two agencies now anticipate that, because of the ACA, about 3 million to 5 million fewer people, on net, will obtain coverage through their employer each year from 2019 through 2022 than would have been the case under prior law. […] In the four alternative scenarios examined, the ACA changes the number of people who will obtain health insurance coverage through their employer in 2019 by an amount that ranges from a reduction of 20 million to a gain of 3 million relative to what would have occurred otherwise. According to the CBO’s July update, the number of people expected to lose employer-based coverage “did not change significantly,” and is now estimated at between “4 million and 6 million fewer people.” [CBO.gov, 3/15/12; CBO.gov, July 2012]

  • CBO: Other Analyses Consistent With Our Best-Guess Scenario. From the Congressional Budget Office: ” Other analysts who have carefully modeled the nation’s existing health insurance system and the changes in incentives for employers to offer insurance coverage created by the ACA have reached conclusions similar to those of CBO and JCT or have predicted smaller declines (or even gains) in employment-based coverage owing to the law. Surveys of employers regarding their plans for offering health insurance coverage in the future have uncertain value and offer conflicting findings.” [CBO.gov, 3/15/12]

CBO: Similar Massachusetts Reforms Have Led To Increase In Employer-Provided Coverage. From the Congressional Budget Office: “One piece of evidence that may be relevant is the experience in Massachusetts, where employment-based health insurance coverage appears to have increased since that state’s reforms, which are similar but not identical to those in the ACA, were implemented.” [CBO.gov, 3/15/12]

Plans In The Insurance Market Are Already Unstable, Causing Eroding Coverage And Higher Premiums. According to Time: “Still, while many employer-based plans will be snared in the regulatory net of the Patient Protection and Affordable Care Act, many of those with this coverage could actually stand to benefit. The new regulations, after all, are designed to protect consumers. If job-based plans have to change — and are not dropped by employers — they will do so in ways that limit what workers have to pay out of pocket and what insurers can refuse to cover. […] Plus, it’s not as though the employer-based insurance market is reliable and stable in its current form. Most employees don’t have any control over the structure of their health insurance. As a result, coverage has been steadily eroding in the past decade, with premium costs for workers increasing 131% from 1999 to 2009, even as the actuarial value of those plans, on average, decreased.” [Time, 6/24/10]

[NARRATOR:] John Hernandez’s vision for California is a little blurry. Hernandez supports the new health care law that cut over $700 billion from Medicare spending, that could allow 15 unelected bureaucrats to make health care decisions for California seniors, imposing a massive new tax on the middle class, while leading to higher costs and loss of current health insurance for some. John Hernandez: The wrong focus for California. Crossroads GPS is responsible for the content of this advertising. [Crossroads GPS via YouTube.com, 10/12/12]