MIT professor Jonathan Gruber has produced a firestorm of controversy over remarks made in various settings about the Affordable Care Act (“Obamacare”) and how drafters like himself relied on the “stupidity” of voters in passing the legislation. It appears that the Gruber hits keep coming, even as he prepares for another round of questioning in Congress. The latest comments from 2009 reveal Gruber saying that Obamacare would not produce affordable health care for many citizens since its focus is coverage not costs. This statement made five months before the passage of the Act from a key architect is in stark contrast to President Obama’s repeated assertions that premiums would go down dramatically. The latest statement will fuel questioning before Congress on whether the White House knew that premiums were unlikely to do down and that people would not be able to keep their current policies as promised by President Obama in selling the program.
Gruber stated in 2009 that Obamacare lacked cost controls in it and would not be affordable for many:
“The problem is it starts to go hand in hand with the mandate; you can’t mandate insurance that’s not affordable. This is going to be a major issue . . . So what’s different this time? Why are we closer than we’ve ever been before? Because there are no cost controls in these proposals. Because this bill’s about coverage. Which is good! Why should we hold 48 million uninsured people hostage to the fact that we don’t yet know how to control costs in a politically acceptable way? Let’s get the people covered and then let’s do cost control.”
That view of the likely impact of the ACA was not only never shared by the Administration, it is in direct contradiction with the statements made by the White House on how costs would decline and people would be able to keep their policies if they liked them.
The latest comments are unlikely to gain Gruber any more allies. Once given millions to advise the federal and state governments on their health care system, he is now persona non grata. Indeed, Democratic minority leader Nancy Pelosi expressed a complete lack of knowledge of who Gruber is, was, or will be — even though she previously cited his work and he was paid $400,000 as one of the architects of Obamacare and has made over $2 million from HHS.
Gruber had already previously attracted controversy with statements where he endorsed the theory at the heart of the recent decisions in Halbig and King by challengers to the ACA: to wit, that the federal funding provision was a quid pro quo device to reward states with their own exchanges and to punish those that force the creation of federal exchanges. That issue will now be decided by the United States Supreme Court. Gruber caused uproar when, after he had denounced the theory as “nutty” during the arguments in Halbig and King, he was shown later to have embraced that same interpretation. Gruber has become a major liability in the litigation. Gruber then was back in the news with an equally startling admission that the Obama Administration (and Gruber) succeeded in passing the ACA only by engineering a “lack of transparency” on the details and relying on “the stupidity of the American voter.” Now a new videotape has surfaced from Gruber speaking at the University of Rhode Island in 2012 and expressing the same contempt for the intelligence of citizens — suggesting again that they were hoodwinked to “the lack of economic understanding of the American voter.” In another view taken from at an October 2013 event at Washington University in St. Louis, Gruber also refers to the “Cadillac tax,” and says “They proposed it and that passed, because the American people are too stupid to understand the difference.” His comments of working in Massachusetts (with Mitt Romney) are no less insulting to an array of people.
The latest statement is also likely to serve to increase calls for Gruber and the Administration to produce withheld documents previously demanded by the House Oversight and Government Reform Committee. This statement is far more important than past comments calling voters or politicians stupid. In 2009, Gruber was saying that the ACA was not about reducing costs but guaranteeing coverage. That seems manifestly true but it was not what the White House was saying at the time or even now. The statements are likely to draw more fire with fines set to increase under Obamacare in 2015.
The statement was again in a lecture by Gruber. Once again, Gruber was displaying the type of honesty and openness that students expect in classroom discussions. That is not the expectation however in political discussions, particularly in Washington. Gruber’s admissions have embarrassed the White House and Democratic leaders who pushed through the ACA on a razor thin vote. This is why academics often find work in politics to be particularly precarious. The nature of our work demands intellectual honestly and transparency that can be a liability in the political world. Indeed, conservative editorial are already proclaiming that “Grubergate” just got “better” .
The cancellation of state contracts is likely to be the least of Gruber’s problems in 2015 as he appears again before Congress.
Vermont would need to DOUBLE its taxes to cover single payor (and they don’t have the crush of illegal immigrants CA does):
http://www.vox.com/2014/12/22/7427117/single-payer-vermont-shumlin
Wishful thinking is not reality. It doesn’t work on a math test, and it doesn’t work in real life.
Karen – we know that the military has too many generals.
Isaac:
So, basically, you think you can repeat the VA single payor system, and get a different result?
We have proven that single payor doctors work 1/8 the workload of private practice. 9 month waiting lists. We have seen over and over again how the government procurement system overpays while providers under deliver.
We are presented every day with government waste and inefficiency, but dreamy eyed people still declare fervently that the government could completely run our health care as single payor cheaper, better, and more efficiently. They just completely ignore all evidence to the contrary. Look at what happened in the aspects of Obamacare in which the government was directly involved – we absurdly overpaid for a website that STILL doesn’t work, and had inadequate security measures. The government required medical and pediatric dental services to be bundled, which prevents people from shopping around for each. It required such a huge amount of “free” benefits that costs skyrocketed and became unaffordable, and yet it’s mandated.
That is what happens when government runs something.
Anyone who keeps repeating a failed experiment, expecting a different result, is foolish.
Vermont abandoned its single payor experiment because it COST TOO MUCH.
http://www.bloombergview.com/articles/2014-12-23/vermonts-lessons-for-fans-of-singlepayer-health-care
Smart as a box of rocks.
Dumber than a fence post.
Rowing with one oar.
Dipstick isn’t touching the oil.
Not the sharpest pencil in the box
🙂
Nick – I love the movie “O Brother, Where Art Thou.” It was based on Homer’s “The Odyssey.”
My own personal favorite phrase is something a friend of mine would say, “Dumber than a box of hair.”
Karen – O Brother Where Art Thou is kinda based on The Odyssey much in the same way Fargo is based on a true story. The Coen Bros. have admitted that they never read The Odyssey.
Scratch that. Reverse it. Once private practice cardiologist handled the workload of 8 VA cardiologists, because the VA doctors don’t get paid to work harder or more efficiently. The government employment system promotes inefficiency and sloth. Hard government workers are like rare diamonds.
Nick
Ah, the dangers of plagiarism. George is wrong also. Of course, he can afford to be wrong, what with his pomade and all.
Karen
Private health insurance companies represent a subsidy that users pay to keep 3 to 4 hundred thousand unnecessary workers, corporate profits, share holders profits. Statistics from all sides prove that if the administration alone was to change to a single payer or single administration, the costs per capita would drop significantly. This is administration only, without changing anything.
Now if you shared the costs of the basic coverage between all, the cost would also drop. That would leave the ‘magic’ of competition to sort out the costs of the supplemental coverage.
Facts and first hand knowledge proves that the US system of parasitical private for profit insurance monopolies drives up costs and as a business is there only to make money. The well being of the citizen is secondary. If it walks like a duck, steals like a duck……
Experts on both sides of the argument have acknowledged that health care is basically the same in the countries with base single payer systems as it is in the US. The US does have an advantage in the medical fields based on money and population, but primarily in the areas of rare and cutting edge issues.
Private for profit is not always the most cost effective way to deal with universal issues. We all pay for health care regardless of whether the system is privately or publicly administered, in the end. A good example is the Pharmaceutical industry. The US is the leading country in developing drugs, but not the only one. It is debatable whether we would be worse off or not or how worse off at all if the government regulated this industry. The budget for the Pharmaceutical industry for research and development ranges between 16% and 18%. The Pharmaceutical industry gives this cost as the main reason why drugs are so expensive in the US as compared with other countries. What they don’t advertise is that they spend between 19% and 21% of their budget on advertising. The US is the only country in the world where people are stupid enough to make decisions on dangerous drugs based on the testimony of animated characters that go from depressed to happy over the course of a TV commercial. We pay for our own stupidity.
Most countries can reduce costs of drugs purchased from these US corporations by buying in bulk, buying long term, and dealing with drugs as most commodities are dealt with, efficiently. However, the Pharmaceutical lobbies have prevented American lawmakers from allowing this. This is an oligarchy.
We, as individuals, pay more to subsidize the private sector and an unnecessary workforce. If that is not socialism imposed then what is?
Isaac, I stole the “Dumber than a bag o’ hammers” line from the loquacious, Everett, played by George Clooney in the classic Coen Bros. flick, O’ Brother Where Art Thou.
this misconception arises when people don’t analyze the math:
Buuuuuut….math is hard. 🙁
Nothing annoys me more than people throwing out statistics and figures without any understanding of how the data was gathered, how the figures relate to other data that they are trying to dispute. Trying to look smart, but ending up appearing stupid. Then when caught in their confusion and ignorance, they double down on stupid and continue to repeat the same talking points over and over. As if just saying it more often make it more true.
/facepalm
Similar to the quoting of statistics about gun deaths versus auto deaths as a reason to more regulate and restrict legal gun ownership.
Meaningless unless you examine the underlying causes and make the correct categorical comparisons.
We only have one single payor model in this country: the VA. If you need a cancer specialist who is not in the VA, too bad. Our honored soldiers died waiting 9 months to see a doctor. Single payor doctors did the work of 8 private practice doctors, because the system engenders sloth.
Again, the objective of Obamacare was to destroy the health insurance system so that people would clamor for single payor, when such a proposal would have been beaten every time before.
You know, the old, now we have a mess, let’s fix it with the socialized medicine we couldn’t get through honest means.
And for those who want single payor, math still operates.
So when you drive costs up with lots of “free benefits” we all pay, whether it’s higher premiums or higher taxes.
And Medicare administrative costs are actually HIGHER than private industry. Again, this misconception arises when people don’t analyze the math:
http://www.heritage.org/research/reports/2009/06/medicare-administrative-costs-are-higher-not-lower-than-for-private-insurance
“Medicare patients are by definition elderly, disabled, or patients with end-stage renal disease, and as such have higher average patient care costs, so expressing administrative costs as a percentage of total costs gives a misleading picture of relative efficiency. Administrative costs are incurred primarily on a fixed or per-beneficiary basis; this approach spreads Medicare’s costs over a larger base of patient care cost.
Even if Medicare and private insurance had identical levels of administrative efficiency, Medicare would appear to be more efficient merely because of an artifact of the arithmetic of percentages–Medicare’s identical administrative costs per person would be divided by a larger number for patient care costs.
Imagine, for a moment, that Fred and Jane each have a credit card from a different bank. Fred charges $5,000 a month, and Jane charges $1,000 a month. Suppose it costs each bank $5 to produce and send a plastic credit card when the account is opened. That $5 “administrative cost” is a much lower percentage of Fred’s monthly charges than it is of Jane’s, but that does not mean Fred’s bank is more efficient. It is purely a mathematical artifact of Fred’s charging pattern, and it would be silly to compare the efficiency of bank operations on that basis. Yet that is how many analysts compare Medicare with private insurance.”
Does anyone really think the government runs anything efficiently???
Now, let’s say that a nonprofit health insurance model arises. It has lower premiums and high quality care. People would flock to it because they would pay less and get more. It would be market driven change without the government having to throw its weight around and demand anything, which it usually mucks up anyway.
Nick
That’s ‘sack of hammers’. Bag infers paper, wouldn’t hold the weight. Sac infers fabric, something that would hold the hammers and is more or less of the same era. You know, thud, thunk, duh. For the closest ‘sac of hammers’ reference try the little painter in Crawford. Now there was a ‘sac of hammers’ and missing a few as well.
Compare the administrative costs of the private, for profit health insurance system with that of Medicare and Medicaid.
According to the Kaiser Family Foundation, administrative costs in Medicare are only about 2 percent of operating expenditures. Defenders of the insurance industry estimate administrative costs as 17 percent of revenue.
According to CMS, for common benefits, Medicare spending rose by an average of 4.3 percent each year between 1997 and 2009, while private insurance premiums grew at a rate of 6.5 percent per year.
The CBO has predicted that the rising cost of private insurance will continue to outstrip Medicare for the next 30 years. The private insurance equivalent of Medicare would cost almost 40 percent more in 2022 for a typical 65-year old.
The most successful and cost effective health care insurance systems are the two tier systems with the base tier provided through taxation and an optional level for those who wish to pay for it. The two tier system combined averages around 50% what Americans pay per capita.
This system did not happen in one move. It evolved out of first getting rid of the parasitical private insurance monopolies and instituting single payer. Then when citizens of these enlightened countries wanted more choice the options of the second tier were added.
Living in both Canada and the US throughout the past twenty-five years I have heard the complaints of both countries. Both countries’ systems have faults. However, the provincial systems in Canada are administered by each province and are continually being fine tuned based on the economy of the moment and the political leanings of a vastly superior Democratic system of representation, i.e. at least four parties or opinions to choose from, not two which for most of the time are manipulated by oligarchs and special interests. Some times, when the economy of a province is booming, the basic health care insurance system is ideal. When times are tough, the government cuts back. Either way the citizen has the choice to either tough it out, augment one’s insurance with a supplemental, private coverage, or pay out of pocket and be reimbursed the amount the provincial government rates the service and deduct the remainder from taxes. Example, my Mom used to swim three times a week at a local pool with non chlorine filtered water. The pool shut down for repairs. She had to drive a half hour to a chlorine filtered water pool. She developed irritation in her eyes due to the chlorine and early stages of cataracts. Her doctor said that because the irritation was due primarily to the chlorine he would schedule her in three to four months for the cataracts as they were not ripe enough on their own to warrant surgery. She, out of her own desire to keep swimming each week, opted to go to a private clinic and have them done the next week. The cost was $2,500 from the private local clinic. First compare that with similar costs in the US,($3,500). BC Med paid their cost rate of $1,300. They deducted the remaining $1,200 from taxes at 33%+/- which reduced out of pocket costs to $800. This was offset in less than three months between what they would have been paying if they lived in Washington State or the average cost for people like them in the US.
Selective information for arguing against single payer is, for the most part, weak, piece meal, and limited to the cherry picking of a mind already made up. There is a better way for the US and that is a single payer system through the government with options for supplemental coverage through the private system. The private system then placed in a position of true choice will not act as the parasitical monopoly it is now does.
Nothing is perfect. But, the US has the least perfect system in the world and it is primarily due to the private health coverage industry, which by the way buys enough politicians, perhaps even Obama, to make even more money.
So, stop complaining and move forward, fix it, drive the parasites out of the health care industry.
Pelosi is the consummate limo liberal. And, dumber than a bag o’ hammers.
Nick – I agree that a valid option is for people to have low-cost, essentially catastrophic coverage, and pay out of pocket to see a doctor. Some doctors are returning to the retainer format.
And I agree with DBQ that health insurance is just one arrow in the quiver that address the true goal, which is affordable access to high quality health care. There are many ways to arrive at that goal, and insurance is just one of them. We seem hyper focused on insurance, without addressing the root causes of soaring health care costs.
Anyone who thought that paying $12,000 plus a year for health insurance was a great idea for a middle class family of 3 should not be allowed to manage their own checkbook, let alone mine. I’ll bet no one involved ever paid for individual coverage, and had all, or most of, their insurance costs covered by government. It’s just SO EASY to increase costs on OTHER PEOPLE, and still pat yourself on the back, because you’re hurting those other people “for the poor.” Let “other people” pay the bill, not the ones who write it or pass it.
Because I can say with complete certainty that Pelosi is not hurting from her decisions like we in the middle class are.
Karen, Didn’t you get the memo?? Dems care about the poor and downtrodden. their goal is to create more of them so they can care even more. You are just a fat cat capitalist, and deserve to be taxed @ 70%.
And what kind of fool tells a stranger she’s done nothing with her life but lived financially comfortable?
I worked my way through college, and have gone through hard financial times before. I’ve helped repair an orphanage in Mexico, among other things. My husband worked for 20 years, and had multiple surgeries to repair the cost to his body, to build middle class financial security that Liberal policies have now threatened.
Done nothing with my life, have I? What have you done with yours?
Let me explain how math works.
There is no “free stuff.” When you add benefits, such as 26 forms of birth control with no copay, that drives up the costs, which insurance companies then spread around to their customers. In the past, they selected some forms of birth control to cover, with a small copay. But now they have to provide all of them, with no copay. They’re not going to lose money to do it. Someone has to pay for that. When we add subsidized and/or sick patients, someone has to pay for that.
Instead of making small changes, that helped the poor first, Big Government made sweeping changes. Do you know I’m required to bundle my medical with pediatric dental coverage now? I’m not allowed to shop around for the best medical and best dental coverage for my kid, which might come from two different sources. Now I’m forced to bundle.
So, when government subsidizes more people, and requires more benefits, we all pay more. When they go too far, we pay so much we can’t afford it. Then you have taken AWAY health care from one group of people to give it to another, and what you’ve given is low quality, anyway.
So you had a lot of people get very excited about the “free stuff” they were going to give away. And then, whoopsie, there was an actual effect on the finances of millions of people.
Anarchist – you are willfully blind if you think you can separate Liberal Democrats from Obamacare. Repeating a false statement does not make it true. Obamacare is the albatross firmly around their necks. The GOP and Libertarians effectively separated themselves from Obamacare, and made it clear they do not support it.
I don’t know how Liberals look anyone in the eye. Don’t they wonder, as they walk down the street, how many people they financially ruined, or strained severely, because of Obamacare? Or do they keep telling themselves, “At least I DID something?”
Once again, they tried to “fix” a problem with Big Government, and ended up making people worse off.
Anarchist, Very good points about the HMO bill vis a vis liability. I have worked med mal cases for 3 decades. That attorney industry exploded w/ the Kennedy/Nixon bill. Hell, how could ANYTHING good come out of those 2 guys getting together? It also changed health insurance from major medical to all inclusive. One would pay for doc visits out of pocket, insurance was for major health issues. I don’t go to all inclusive hotels because it takes away choice. “There is no freedom w/o choice.” The same w/ health insurance. You were invested in controlling cost. That is when insurance took control of the system. Then, Anarchist, you end w/ a screed on Republicans. WTF! Who gave us this beast of Obamacare?? Using one side of that brain, and the other side has atrophied.