Free Markets, Free People

Douglas Elmendorf


CBO Fact Checks Obama – Again

Yes those party poopers at the Congressional Budget Office are at it again. This time they’ve found the Obama claim that “seniors won’t see any of their Medicare benefits cut under the planned health care reforms” to be, well, not true.

The head of the nonpartisan Congressional Budget Office, Douglas Elmendorf, told senators Tuesday that seniors in Medicare’s managed care plans would see reduced benefits under a bill in the Finance Committee.

The bill would cut payments to the Medicare Advantage plans by more than $100 billion over 10 years.

Elmendorf said the changes would reduce the extra benefits that would be made available to beneficiaries.

My guess is Doug Elmendorf will probably not make the White House Christmas list this year.

~McQ


Another Democrat Health Care “Fact” Bites The Dust

When we were still talking about “health care reform”, before it was renamed “health insurance reform”, one of the big selling points was government was going to change the way we did business. I.e. it was going to stress “preventive care” which, so the Dems claimed, would be less costly in the long-run.

The CBO, however, has said, “not so fast”. In a letter to Henry Waxman, among others, Dr. Douglas Elmendorf, Director of the Congressional Budget Office writes:

“Although different types of preventive care have different effects on spending, the evidence suggests that for most preventive services, expanded utilization leads to higher, not lower, medical spending overall,” Elmendorf wrote. “That result may seem counterintuitive.

“For example, many observers point to cases in which a simple medical test, if given early enough, can reveal a condition that is treatable at a fraction of the cost of treating that same illness after it has progressed. In such cases, an ounce of prevention improves health and reduces spending — for that individual,” Elmendorf wrote. “But when analyzing the effects of preventive care on total spending for health care, it is important to recognize that doctors do not know beforehand which patients are going to develop costly illnesses. To avert one case of acute illness, it is usually necessary to provide preventive care to many patients, most of whom would not have suffered that illness anyway. … Researchers who have examined the effects of preventive care generally find that the added costs of widespread use of preventive services tend to exceed the savings from averted illness.”

This is another in a long line of “facts” the Democrats have attempted to use to sell their “more coverage, better care, less cost” health care insurance reform. And it is another “fact” that has been found to be false.

Going through Elmendorf’s reasoning provides a very good explanation of why it is false. But I’ll bet that none of that reasoning or information will find its way into Democratic talking points about the goals of this legislation. Instead the false “fact” about preventive care lowering overall costs will stubbornly remain.

If so, my suggestion is you send it in as a “fishy” statement to be refuted by the White House crew that deals with these sorts of fishy facts.

Oh wait, nevermind. Apparently the White House has already dealt with the fishy CBO’s report- well sort of:

Responding to the CBO letter, Linda Douglass, the communications director for the White House Office of Health Reform, said that, “to work, prevention has to be targeted. Proven services need to be directed to populations that need it, as the CBO letter suggests. We will continue to work with Congress on ensuring that dollars are spent on prevention that gets the biggest bang for the buck.”

Douglass argued, however, that there would be long-term financial savings, saying “we can’t forget that many of the benefits of prevention will accrue to the Federal government in thel long term as opposed to the near term. Prevention results in longer, healthier, more productive lives — yielding savings that don’t typically show up on a score sheet. We have to return to common sense: keeping people out of a doctor’s office or hospitals saves money. Seventy-five per cent of our health care spending goes to treat chronic diseases, many of which could be prevented from developing in the first place . Proven preventive services are worth it.”

Notice that the CBO says the problem is that preventive care can’t be targeted because doctors have no idea who would benefit until they run batteries of tests on everyone. And that is what the CBO highlights as running the costs up.

Additionally, no one is claiming “proven preventive services” don’t work or aren’t “worth it”. What CBO is claiming is they’re not “less costly”, something Douglass avoids addressing. All in all a most unsatisfactory and fishy response to the CBO argument.

~McQ