By Phil Kerpen
It became a major scandal when Philadelphia-based researcher Rich Weinstein uncovered video of Jonathan Gruber, the architect of Obamacare, saying: "This bill was written in a tortured way to make sure the CBO did not score the mandate as taxes. If CBO scored the mandate as taxes, the bill dies."
The quote became famous but was widely misunderstood; he was not referring to the penalty vs. tax question on which Chief Justice John Roberts would later uphold the law. The issue was whether the payment for a mandatory government insurance program should be scored as tax revenue – like Social Security or Medicare premiums – or considered private sector payments. This is crucial because a program scored as taxes and spending is transparently a government takeover, with potentially trillions of dollars shifted from the private sector to government.
There's bad news for Joe Biden's current plan. As Biden explained: "I'd bring back the individual mandate... and here's the deal. We're in a situation where if you provide an option for anybody who in fact wants to buy into Medicare for All, they can buy in."
It's hard to see how a mandate paired with a government plan could be scored by CBO as anything but taxes and spending.
The relevant CBO document is a report from May of 2009.
Biden's Medicare-for-All public option would unambiguously be scored as a government program, even if he tried to dress it up as a nonprofit. But what about the mandatory purchase of putatively private insurance under the Biden scheme? Could tortured language exclude that from the CBO score? Probably not this time.
The central framework of Obamacare, an individual mandate to buy a tightly regulated but notionally private insurance product, was a close call for CBO. Gruber, Pelosi, and Obama got away with it based the expectation that there would be many different companies in the exchanges (which in most of the country has not occurred) and on the lack of a public option.
Once Biden adds his public option, the whole program clearly becomes taxes and spending, exposing the massive expansion in the size of government expressly to the American people:
"In CBO’s view, a requirement that individuals purchase health insurance combined with tight federal constraints on the market for such insurance or a dominant role for a public plan would constitute a fundamentally governmental system, reflecting the exercise of the government’s sovereign power. In those situations, premiums appearing in the budget — for a public plan or for insurance purchased through exchanges or in the private market — should be recorded as federal revenues."
If CBO sticks to this standard, Biden will lose the principal advantage of the public plan strategy – its ability to camouflage from American voters that it leads directly to forcing everyone into a one-size-fits-all government plan by creating the illusion of allowing a choice of private plans.
The "public option" strategy for ending private insurance is to set it up in...
By Jon Decker
Last week, President Trump issued an executive order directing federal agencies to halt or repeal regulations that impede America’s recovery from the coronavirus. Trump’s focus on tackling government red tape for the next phase of the Covid recovery should be applauded — if there is one thing the pandemic has made clear, it’s that we need more social distancing between bureaucrats and the federal register.
From the onset of the virus, bureaucratic incompetence has hindered America’s recovery. First, the CDC mass-produced coronavirus tests that were contaminated with live virus. If that wasn’t enough, a federal regulation pre-dating the Trump administration made it more difficult for the private sector to step up and cover the CDC’s testing gap.
As the Competitive Enterprise Institute noted in a detailed report:
Under the Food, Drug and Cosmetic Act, diagnostic tests are considered medical devices and therefore subject to the FDA’s premarket review requirements. Under normal circumstances, the FDA has used its enforcement discretion to waive the premarket review requirement for tests developed and used exclusively within a single laboratory, known as “laboratory developed tests” (LDTs).
However, when the Secretary of Health and Human Services declares an official public health emergency, the agency does require premarket approval for LDTs, though it will grant an expedited Emergency Use Authorization for LDTs that meet the necessary criteria.
Translation: The CDC sent out tests contaminated with live virus, and the FDA said the private sector must have its approval before selling alternatives. No wonder Reagan said the scariest words in the english language were “I’m from the government, and I’m here to help.” Repealing the FDA’s burdensome testing regulations is critical to ensuring America is better prepared for...
By Phil Kerpen
For years the major health care policy debates in Washington and state capitals have been distorted by the fact that one of America's best known and trusted advocacy organizations, AARP, has functioned largely as a lobbying and PR front for the country’s biggest health insurer, UnitedHealth. Yet elected officials continue to see and hear their advocacy messages as representing millions of seniors – who are famously reliable voters – with a serious corrosive impact on the ability to advance meaningful free-market health reforms.
Even during this pandemic, with the whole world hoping that the biopharmaceutical industry can discover and deliver breakthrough cures and vaccines at record speed, AARP continues to bang the drum for government price controls. In fact, after the pandemic arrived in America AARP sent a letter advocating for Nancy Pelosi's draconian price control plan, which would threaten drugmakers with a tax of 95 percent of their gross revenues if they don't accept government set prices.
When governments set the price of such things as cutting-edge drugs needed innovations and investments dry up. A new cure now costs an average of $2.6 billion to bring to market. If government policy makes it impossible to recover those costs and earn a return on capital, as Pelosi's bill would, seniors would suffer from a shortage of new cutting-edge treatments and potential cures for diseases like Alzheimer’s, cancer, diabetes – and of course from any new emerging pandemic, like the one we face now.
Why would a seniors group favor undermining the discovery of new cures seniors need?
A forthcoming report by Juniper Research (commissioned by American Commitment) explains this seeming paradox. Chris Jacobs explains how AARP – which somehow maintains a tax-exempt charitable status – has raked in an astounding $11 billion from its sales and marketing activities over the past decade, with revenues climbing from just under $200 million in 2001 to over $900 million in 2018.
Most of that revenue comes from UnitedHealth, which from 2010 to 2017 sent AARP a staggering $4.2 billion. That includes a record $627 million in 2017 – after which AARP stopped specifically disclosing how much it takes in from UnitedHealth. This is the same UnitedHealth that brought in record profits this quarter that, ironically, has come during a deadly pandemic.
The lion's share of that windfall is from the sale of Medigap policies, for which AARP collects a nifty 4.95 percent off the top for lending its name and exclusive endorsement. Calling their vig a royalty instead of commission, they claim, sidesteps all of the rules and regulations for brokers and insurance sales. In fact, AARP recently defeated an Ohio lawsuit by arguing, successfully, that their relationship with their members "is not one of 'trust or confidence'" and that membership “does not ‘transcend an ordinary business’ relationship."
With all that money flowing, AARP's policy positions almost always align with UnitedHealth's business interests. Start with Obamacare. Despite overwhelming 14-to-1 opposition from its members, AARP’s executives supported it –...
Our analysis, embedded in the Google sheet below shows that half of reported U.S. COVID deaths are among nursing home residents, and that share has been sharply rising over the last two weeks. Clearly, the lockdowns are not preventing coronavirus from spreading in nursing homes. It's time to open America.