Fact-checking ‘Obamacare’ myths

During this, the anniversary week of the passage of the Patient Protection and Affordable Care Act, supporters and opponents offered their love or hate for the law; though largely hate got the most press. A Bloomberg Businessweek article quotes nonprofit Consumers for Health Care Choices director Greg Scandlen calling the act “the worst law ever enacted in the United States.”

Defending the new law, U.S. Department of Health and Human Services Secretary Kathleen Sebelius wrote an editorial in Friday’s Columbus Dispatch debunking arguments that the health care act has not destroyed the Medicare Advantage program or harmed small businesses.

“The Affordable Care Act is not perfect; no law ever is,” Sebelius writes. “The Obama administration continues to be open to any ideas to improve it. For example, Obama has joined with Democrats and Republicans in calling for the repeal of a bookkeeping provision in the law that was too burdensome on small businesses.”

Sebelius also claims that the law is, in fact, not bad for our economy, arguing that since the president signed PPACA into law, the economy has grown at an average annual rate of 2.7 percent and created nearly 1.4 million private-sector jobs.

But it’s on this last note that opponents have come out strongly against the law, armed with Congressional Budget Office’s recently released preliminary analysis of the president’s 2012 budget, which notes:

The provisions related to expanding health insurance coverage were projected to increase the deficit between 2012 and 2021 by $1.04 trillion, on net, in CBO’s January baseline; they are now projected to increase the deficit by $1.13 trillion over that period.

Subsequent figures related to how much the health care legislation is costing American taxpayers inspired The Washington Post to call “fuzzy math” on some of the assumptive projections, pointing to the GOP-led House Energy and Commerce Committee that claimed “Obamacare Price Tag Spikes by 54%” and The Wall Street Journal, which suggested costs from the new law have risen by 8.6 percent. The Energy and Commerce Committee released a statement this week saying the cost of the health care act has increased by $500 billion, “meaning, in only one year, the cost has increased from an already staggering $938 billion price tag to $1.445 trillion.”

From the Post:

Last week was the third time that CBO has provided an estimate for the cost of the health care bill. Each time, the number has been a little different because of various technical factors, and also because different budget windows are being used, such as 2010-2019, 2012-2019 or 2012-2021. The longer the budget window, the bigger the costs and the revenues, in part because the population is getting larger and the gross domestic product is expected to increase.

The Energy and Commerce Committee came up with its increase by mixing apples and oranges. It compared the gross cost of insurance coverage provisions calculated for 2010-2019 (that’s the $938 billion number) with new figures for a different budget window, 2012-2021 (that’s the $1.445 trillion figure.) That’s kind of like saying the cost of pizza went up by comparing last year’s price for a 12-inch pie with this year’s price for a 16-inch pie.

[...]

Yes, certain provisions do not kick in immediately, but neither do many of the new taxes. The revenue estimate by the Joint Tax Committee shows that $58 billion of revenue is raised in the first four years, compared to $380 billion over the last six years. As mentioned before, the cost numbers also get larger in later years because of population and GDP growth.

The Wall Street Journal came up with its increase by comparing a different set of numbers: the net cost (which strikes us as more reasonable than the gross cost used by the House committee) for the same time period, 2012-2021, as estimated in February 2011 and March 2011. But the Journal failed to note that the CBO cost estimate in February was actually lower than its initial estimate last year, so the overall effect from last year to this year is minimal.

Doing its own health care “myths” fact-checking, the St. Petersburg Times’ PolitiFact analyzed several common statements about the PPACA and gave them ratings of true or half-true.

The following statements were rated “true.”

• Under the new health care law, “if a landscaper wants to buy a new lawnmower, or a restaurant needs a new ice-maker, they have to report that to the feds.”
• New provisions of the health care law bar the use of flexible spending accounts and health savings accounts to pay for aspirin and other non-prescription health needs.
• “With this reform, every insured American gets valuable consumer protections, and every uninsured American can become insured.”
• “Obama put a 10 percent tax on tanning.”
• Orrin Hatch (and other Republicans) co-sponsored a 1993 health care bill that had an individual mandate.

These were rated “half-true”:

• The health care bill “cuts the deficit by over $1 trillion dollars.”
• The health care reform law pays for “6 years of benefits with 10 years of tax increases.”
• The majority of people in polls do “not support Obamacare.”
• Under the clear letter of the law,” Justice Clarence Thomas “must recuse himself” from the case challenging the constitutionality of the health care law.
• The federal government “may put 16,500 IRS agents in charge of policing President Obama’s health care bill.”

Read PolitiFact’s full analysis here.