White House video on CBO health-care es­ti­mates is truly mis­lead­ing

The Washington Post Sunday - - POLITICS & THE NATION - GLENN KESSLER glenn.kessler@wash­post.com

The ven­er­a­ble Con­gres­sional Bud­get Of­fice is un­der at­tack. Es­tab­lished in 1975 by Congress to pro­vide in­de­pen­dent analy­ses of leg­is­la­tion, the non­par­ti­san agency is un­der fire for its es­ti­mates of the ef­fects of Repub­li­can pro­pos­als to re­peal and re­place the Af­ford­able Care Act.

This is not a new po­si­tion for the agency. The CBO’s re­fusal to credit much bud­get sav­ings to Hil­lary Clin­ton’s 1993 health-care plan is one of the fac­tors that killed her ef­fort dur­ing Pres­i­dent Bill Clin­ton’s ad­min­is­tra­tion. But the rhetoric at­tack­ing the CBO this time around cer­tainly seems sharper. All eight pre­vi­ous CBO di­rec­tors is­sued a joint let­ter this month to con­gres­sional lead­er­ship “to ex­press our strong ob­jec­tion to re­cent at­tacks on the in­tegrity and pro­fes­sion­al­ism of the agency and on the agency’s role in the leg­isla­tive process.”

A re­cent video posted by the White House is a case in point. Ti­tled “Real­ity Check,” it claims the “Con­gres­sional Bud­get Of­fice’s math does not add up.” In par­tic­u­lar, it makes two key claims — that the CBO “in­ac­cu­rately mea­sures health cov­er­age” and that it uses “faulty as­sump­tions and bad num­bers.”

How valid is the White House case?

The Facts “In­ac­cu­rately es­ti­mates health cov­er­age”

This claim is based on the fact that the CBO, in its ini­tial es­ti­mate of the ACA, pro­jected that in 2017, 25 mil­lion peo­ple would be en­rolled in the Oba­macare ex­changes; to­day, 10.3 mil­lion are. It sounds like a big miss, but the White House is play­ing a shell game here, high­light­ing a sub­set of the data.

The key fo­cus of the CBO’s es­ti­mates in 2010 (which had to be re­vised in 2012 af­ter the Supreme Court ruled that states could not be forced to ex­pand Med­i­caid) was to es­ti­mate how many peo­ple would gain in­sur­ance un­der the law. On that score, CBO ba­si­cally aced it, do­ing much bet­ter than other fore­cast­ers at the time, ac­cord­ing to a 2015 anal­y­sis of var­i­ous pro­jec­tions by the Com­mon­wealth Fund.

The CBO es­ti­mated that the num­ber of nonelderly peo­ple with­out in­sur­ance would drop to 30 mil­lion in 2016. The ac­tual fig­ure in 2016, ac­cord­ing to the Cen­ters for Dis­ease Con­trol and Pre­ven­tion: 28.6 mil­lion. That rep­re­sented a drop of 20 mil­lion from 2010, when the ACA be­came law.

This top-line es­ti­mate is what is im­por­tant, be­cause it helps de­ter­mine how var­i­ous health­care poli­cies af­fect the fed­eral bud­get. More peo­ple in em­ploy­er­pro­vided plans will drain tax rev­enue be­cause of tax breaks given for em­ployer-pro­vided in­sur­ance, while more peo­ple on Med­i­caid or re­ceiv­ing tax sub­si­dies for poli­cies bought on the ex­changes will boost fed­eral spend­ing.

CBO got the mix of types of in­sur­ance in­cor­rect, un­der­es­ti­mat­ing the num­ber of peo­ple join­ing Med­i­caid and over­es­ti­mat­ing how many em­ploy­ers would re­quire em­ploy­ees to join the ex­changes. The agency also did not pre­dict (un­der­stand­ably) the web­site prob­lems and slow roll­out that af­fected en­roll­ment from the start (and prob­a­bly made em­ploy­ers re­luc­tant to stop pro­vid­ing their own in­sur­ance).

Here’s an anal­ogy: A farmer tries to pre­dict how many an­i­mals would be in his barn­yard 10 years from now. He gets the over­all num­ber right, but the ra­tio of chick­ens, goats and pigs is dif­fer­ent than he ex­pected.

The pro­jec­tions for the sub­cat­e­gories are al­ways go­ing to be prone to more er­ror than over­all es­ti­mates. The mar­gin of er­ror in polls, for in­stance, in­creases as you dig deeper into cer­tain vot­ing groups. But what mat­ters most is if the poll pre­dicts the ac­tual mar­gin of vic­tory.

So, al­though the video claims that the CBO in­ac­cu­rately mea­sures health cov­er­age, the CBO just about nailed the most im­por­tant fig­ure from a bud­get per­spec­tive. That’s rel­e­vant be­cause, in the video, the White House is try­ing to un­der­mine an equiv­a­lent fig­ure in the CBO’s es­ti­mate of Se­nate GOP plans — that 22 mil­lion fewer peo­ple than un­der the cur­rent law would have health in­sur­ance a decade from now.

“Faulty as­sump­tions and bad num­bers”

In the sec­ond sec­tion of the video, the White House men­tions that 22 mil­lion fig­ure and says it’s wrong be­cause the CBO “falsely as­sumes” that 18 mil­lion peo­ple would be on the Oba­macare ex­changes in 2018. The video says that this is be­cause of “faulty base­line es­ti­mates” since only about 10 mil­lion are in the ex­changes as of 2017. The video sug­gests that, thus, the ef­fect of the GOP pro­pos­als is over­stated.

It’s cor­rect that the CBO base­line in­di­cates 18 mil­lion peo­ple would be on the ex­changes in 2018 — but that’s be­cause Repub­li­can lead­ers in Congress told the CBO to use this par­tic­u­lar base­line. It’s a base­line from March 2016, not the more re­cent Jan­uary 2017 base­line, which scaled back the fig­ure and es­ti­mates that 11 mil­lion peo­ple would par­tic­i­pate in the ex­changes in 2018. So the White House is try­ing to fault the CBO for a de­ci­sion made by its con­gres­sional al­lies.

Here’s what hap­pened: The GOP-led Congress in Jan­uary was in such a rush to re­peal Oba­macare that it moved for­ward be­fore the CBO could com­plete an up­dated base­line, as it does reg­u­larly dur­ing the year. So bud­get in­struc­tions for the year were based on the March 2016 base­line, and the CBO was or­dered to do its anal­y­sis of health-care pro­pos­als based on the old base­line.

Since then, the CBO has re­leased an up­dated base­line in Jan­uary and an­other in June. Even so, the CBO is still be­ing told by GOP con­gres­sional lead­ers to cal­cu­late off the old March 2016 date­line. Close read­ers of the CBO es­ti­mates would note that the agency is up­front about this prob­lem, high­light­ing in its es­ti­mates that it is us­ing the March 2016 base­line.

The prob­lem for Repub­li­cans in Congress is that switch­ing to a more re­cent base­line might ac­tu­ally not change the bot­tom­line ef­fect on the num­ber of unin­sured — while it could re­duce the pro­jected bud­get sav­ings that law­mak­ers are count­ing on to use a par­lia­men­tary pro­ce­dure that thwarts a Se­nate fil­i­buster re­quir­ing 60 votes. (Fewer peo­ple in the ex­changes could mean the sav­ings from re­peal­ing much of the law are lower.) The whole rea­son for us­ing this pro­ce­dure, known as rec­on­cil­i­a­tion, is to avoid hav­ing to ne­go­ti­ate with Democrats on the leg­is­la­tion. So switch­ing to a more ac­cu­rate base­line might have made pas­sage in the Se­nate even more dif­fi­cult.

In other words, it’s rather hyp­o­crit­i­cal for the White House to blame the CBO for us­ing a base­line man­dated by Repub­li­cans as part of an ef­fort to cut Democrats out of the process. If given a choice, the CBO pre­sum­ably would pre­fer to of­fer cal­cu­la­tions based on the most re­cent base­line, as then es­ti­mates of the po­ten­tial ef­fect on the bud­get would be more ac­cu­rate.

We sought a com­ment from the White House but did not re­ceive a re­sponse.

The Pinoc­chio Test

This is yet an­other mis­lead­ing bit of health-care spin is­sued by the White House. The CBO ob­vi­ously is not per­fect, but it is non­par­ti­san and tries to do the best an­a­lyt­i­cal work pos­si­ble.

The CBO got the over­all im­pact of the ACA on the num­ber of unin­sured largely cor­rect, giv­ing cred­i­bil­ity to its es­ti­mates on the ef­fects of the GOP pro­pos­als. More­over, even the CBO con­cedes that the base­line it is us­ing is not ideal, but it has to use this base­line be­cause of or­ders by Repub­li­cans in Congress. So if the White House has a com­plaint, it should con­tact its al­lies in Congress, not blame the CBO.

This video earns three Pinoc­chios.

“The Con­gres­sional Bud­get Of­fice’s math doesn’t add up. Faulty Num­bers = Faulty Re­sults.”

— Tweet by the White House Twit­ter ac­count, July 12, 2017


The Con­gres­sional Bud­get Of­fice, lo­cated in the Ford House Of­fice Build­ing, came un­der fire for its es­ti­mates of the ef­fects of Repub­li­can pro­pos­als to re­peal and re­place the 2010 Af­ford­able Care Act.

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