The Wizard of Cost Control
Congressman Joe Pitts, January 15, 2010
"Pay no attention to my six-figure stipend." That’s what MIT economist Jonathan Gruber has been saying since it was revealed that he was being paid by the Department of Health and Human Services while also defending the administration’s health bill as an "independent researcher."
Gruber is a health economist currently with MIT, but formerly with the Clinton Treasury Department. Long a proponent of more government control of the healthcare industry, in the last year, Gruber has been paid nearly $400,000 by HHS for "consulting" work.
Gruber has not been forthcoming about his contract when writing about healthcare in public forums. He failed to disclose his association with the administration in a New York Times editorial defending the so-called "Cadillac" tax on high benefit health plans and in numerous other forums. Only after being published in the more rigorous New England Journal of Medicine was it revealed that he is on the federal payroll.
While Gruber claims that the contracts have nothing to do with his advocacy, clearly he should not be identified as an independent analyst. His contract with HHS may not require him to defend the administration’s positions, but it certainly makes him more agreeable to them.
When the insurer Wellpoint released a study showing the state by state effect healthcare reform would have on premiums, the White House attacked the report as biased. At the same time, White House budget chief Peter Orszag was using Gruber’s praise of healthcare reform to support the administration’s position.
Both Gruber and the White House tried to ignore the fact that the MIT professor was being paid a substantial amount of money by the administration. Criticism of the lack of transparency has come from both liberal and conservative media outlets. In fact, the liberal website DailyKos was one of the first to note that Gruber has a paid position.
As noted by the left-leaning HuffingtonPost, Gruber’s analysis was cited without disclosure in the Washington Post, The Atlantic, and in 71 separate e-mails from the Democratic National Committee. But why was this one source so widely cited? Because there was nowhere else to go for evidence that that the current version of the healthcare reform bill will reduce the rising costs of health insurance.
On the campaign trail, President Obama time and time again claimed that his health plan would save each American family $2500 per year. Such savings would be substantial and there would be little objection to a healthcare bill that really could provide such broad savings to the American public.
Unfortunately, neither the Senate nor the House bill meets this standard. The Wellpoint study mentioned earlier claims that their customers could see rates double under the House version of "reform." The Congressional Budget Office has stubbornly insisted that neither of the bills do very much, if anything, to curb rising costs.
Trying to distract from the lack of cost control, a talking point about both bills was that they would reduce the deficit. Of course, this meager deficit reduction would only come after Medicare is slashed by a half trillion dollars and taxes are raised another half trillion dollars. Even then, if the cost of fixing Medicare reimbursement rates were included in the bill, the deficit would rise by hundreds of billions of dollars in the first ten years and possibly even faster after 2019.
With little analysis to counter the conclusions of the CBO and so many other independent groups, the White House and Democratic leadership is forced to rely on paid analysts such as Jonathan Gruber. While he may earnestly believe that the present healthcare reform would control costs, he is not the independent authority he pretended to be.
The final healthcare bill will, in all likelihood, stretch to nearly 3,000 pages. Based on present reports, there will be a multitude of changes from the two present bills. While Speaker Pelosi is promising to give the House 72 hours to read over the new bill, I doubt that three days will be enough time to contemplate what affect it will have on our health and on our economy.
I don’t believe that the process to reform healthcare has been thoughtful or transparent. With the final details being constructed behind closed doors, only 36 percent of the American people still support the current plans. We need a carefully considered plan that a clear majority of Americans can get behind, not a partisan push for a government takeover of the healthcare industry.
Congressman Joe Pitts, a Republican, represents Pennsylvania's 16th Congressional District, which includes Lancaster County and parts of Chester County and Berks County.
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