Obamacare architect in 6th video: 'Mislabeling' helped us get rid of tax breaks
updated 3:07 PM EST, Fri November 14, 2014
Jonathan Gruber
STORY HIGHLIGHTS
- MIT economist Jonathan Gruber is considered the architect of Obamacare
- Videos where Gruber insults voters and explains the law have recently emerged
- Opponents of Obamacare see this as evidence of the law's ill will
Washington (CNN) -- In a 2011 conversation about the Affordable Care Act, MIT economist Jonathan Gruber, one of the architects of the law more commonly known as Obamacare, talked about how the bill would get rid of all tax credits for employer-based health insurance through "mislabeling" what the tax is and who it would hit.
In recent days, the past comments of Gruber -- who in a 2010 speech noted that he "helped write the federal bill" and "was a paid consultant to the Obama administration to help develop the technical details as well" -- have been given renewed attention.
In previously posted but only recently noticed speeches, Gruber discusses how those pushing the bill took part in an "exploitation of the lack of economic understanding of the American voter," taking advantage of voters' "stupidity" to create a law that would ultimately be good for them.
The issue at hand in this sixth video is known as the "Cadillac tax," which was represented as a tax on employers' expensive health insurance plans. While employers do not currently have to pay taxes on health insurance plans they provide employees, starting in 2018, companies that provide health insurance that costs more than $10,200 for an individual or $27,500 for a family will have to pay a 40 percent tax.
"Economists have called for 40 years to get rid of the regressive, inefficient and expensive tax subsidy provided for employer provider health insurance," Gruber said at the Pioneer Institute for public policy research in Boston. The subsidy is "terrible policy," Gruber said.
"It turns out politically it's really hard to get rid of," Gruber said. "And the only way we could get rid of it was first by mislabeling it, calling it a tax on insurance plans rather than a tax on people when we all know it's a tax on people who hold those insurance plans."
(The White House press secretary said at a press briefing in 2010: "I would disagree with your notion that it is a tax on an individual since the proposal is written as a tax on an insurance company that offers a plan.")
The second way was have the tax kick in "late, starting in 2018. But by starting it late, we were able to tie the cap for Cadillac Tax to CPI, not medical inflation," Gruber said. CPI is the consumer price index, which is lower than medical inflation.
Gruber explains that by drafting the bill this way, they were able to pass something that would initially only impact some employer plans though it would eventually hit almost every employer plan. And by that time, those who object to the tax will be obligated to figure out how to come up with the money that repealing the tax will take from the treasury, or risk significantly adding to the national debt.
"What that means is the tax that starts out hitting only 8% of the insurance plans essentially amounts over the next 20 years essentially getting rid of the exclusion for employer sponsored plans," Gruber said. "This was the only political way we were ever going to take on one of the worst public policies in America."
Unions and employers who object in 2018, he noted, "at that point if they want to get rid of it they're going to have to fill a trillion dollar hole in the deficit...It's on the books now."
(When the Cadillac tax was first rolled out, it was explained by Obamacare backers as a tax that would only impact those with "high end plans" -- not all employer sponsored plans. A White House economic adviser in 2009 set "the record straight" by saying "the excise tax levied on insurance companies for high-premium plans, the so-called 'Cadillac tax,' will affect only a small portion of the very highest cost health plans -- a total of 3% of premiums in 2013.")
Gruber's are at about the 30:38 mark here.
Former White House press secretary Jay Carney told CNN that Gruber's remarks in general were "very harmful politically to the president."
Gruber "speaks from the Ivory tower with remarkable hubris about the American voter and by extension the American Congress," Carney told The Lead with Jake Tapper. "Any health care reform that sought to control costs and expand insurance would involve winners and losers. And that's always going to be the case."
Many of the videos were discovered by a Philadelphia-area financial adviser named Rich Weinstein who has spent the last year researching Obamacare after his family insurance premiums doubled. Weinstein told CNN that he had assumed, incorrectly, that since he liked his health insurance plan and he had insurance, he wouldn't be much impacted by the new law.
In a sane society Gruber would be hauled off to prison for a crime far worse then Enron or any of the other financial miscreants. If they can't profit from lies why should he. I hope the new Congress hauls him up before a committee.
Obamacare architect Jonathan Gruber has billed federal and state governments at least $5.9 million for advice, as more videos surface showing him undercutting the landmark law
- MIT economist got $392,600 from the Dept of Health and Human Services for his Obamacare consulting
- National Institutes of Health paid him $2 million for Medicare consulting
- Justice Department has added $1.7 million for expert witness testimony
- Four US states combined to pay him another $1.6 million for advice about health care laws, and contracts for four more states were unavailable
- If those states followed suit, Gruber's haul would exceed $7.5 million
- Gruber has become a thorn in Democrats' sides since videos emerged of him candidly discussing how the Obama White House misled Americans to pass the Obamacare law
Four U.S. states and the federal government have padded Obamacare architect Jonathan Gruber's wallet to the tune of $5.9 million since 2000, including millions connected to his work on the Affordable Care Act.
The Massachusetts Institute of Technology economist has been pilloried for collecting $392,600 from the Obama administration's Health and Human Services Department while the law was being written, but that was just the tip of the iceberg.
Gruber's consulting contracts give states and the feds access to a proprietary formula that can determine how changes in a health care system's structure will affect costs.
The 'Gruber Microsimulation Model' is what he sold to the White House. It helped Obama's team anticipate what the influential Congressional Budget Office (CBO) would say about various features of the final plan – and whether their costs would officially be considered 'taxes.'
Scroll down for video
THE LATEST VIDEO: Jonathan Gruber told a Virginia healthcare research company in 2012 that he helped Massachusetts 'rip off' the feds for $400 million per year by shifting Medicare funds to cover the uninsured – and 'Romneycare' was born
Better days: In May 2009 Gruber was testifying before congressional panels as a respected economist with the magic touch and the ear of every Democrat in Washington
Gruber found himself in hot water this week when an old video surfaced in which he explains how the Obama administration wriggled out of legislative trouble by hiding 'Cadillac taxes' on expensive medical insurance policies – by shifting the costs to insurers and trusting them to pass the financial burden on to their customers.
'The stupidity of the American voter' let him get away with it, he said in one videotaped speech at the University of Pennsylvania.
Gruber explained that the Obamacare law 'was written in a tortured way to make sure the CBO did not score the [individual insurance] mandate as taxes.'
'If CBO scored the mandate as taxes, the bill dies.'
The Washingon Post reported Friday that the National Institutes of Health put about $2.05 million in Gruber's pocket since 2008 for consulting work related to Medicare Part D prescription drug plans.
The Justice Department has added $1.7 million more – mostly for 'expert witness' testimony – since 2000.
And the State Department paid Gruber $103,500 in 2008 and 2009 for what the government vaguely calls legal services, according to an analysis by The Daily Caller.
ILL HEALTH: The Obamacare law is wildly unpopular, according to an average of public polls, and the Gruber controversy will give Republicans new momentum to argue for its repeal
Of the eight U.S. states that have contracted with Gruber to get access to his computer model – Colorado, Connecticut, Maine, Michigan, Minnesota, Vermont, West Virginia and Wisconsin – four of them have published contracts worth about $400,000 each.
If the other four followed suit, that would amount to another $1.6 million. Some of those fees were shared with other researchers who co-authored his reports.
All eight used his services to help estimate insurance marketplace costs related to their state-based Obamacare programs.
Gruber also worked extensively on the so-called 'Romneycare' law, a Massachusetts health insurance plan that formed the intellectual and philosophical underpinnings of Obamacare, and reportedly won a consulting contract with the state of California.
The Vermont model he built along with Harvard School of Public Health economist William Hsiao is an attempt to construct a 'single-payer' insurance system that puts government in charge of health care costs for everyone in the state.
The sixth in a long line of embarrassing videos emerged Friday, showing the two academics testifying before lawmakers there.
One legislator quoted a newspaper op-ed warning that 'any Hsiao-Gruber-type health care mega-system will inevitably lead to coercive mandates, ballooning costs, increasing taxes, bureaucratic outrages, shabby facilities, disgruntled providers, long waiting lines, lower-quality care, special-interest nest-feathering, and destructive wage and price controls.'
In the video, brought to light by Watchdog.org, Gruber is seen responding: 'Was this written by my adolescent children by any chance?'
The room erupted in laughter, but the comment had actually come from the pen of two-term Vermont state senator John McClaughry, by then serving as vice president of the conservative Ethan Allen Institute.
A St. Louis, Missouri blogger unearthed records on Friday showing that Gruber met with President Obama at the White House on July 20, 2009.
That backed up a PBS Frontline interview he gave in 2012, in which he positioned himslelf as a major player in the Obamacare law's evolution.
He saw Obama, he said, in 'summer 2009.'
'The big issue there is that he really wants to make sure I’m moving forward on cost control. I think that at this point he sort of knew we had a good plan on coverage, but he was worried on cost control.'
'So we had a meeting in the Oval Office with several experts, including myself,' Gruber continued, 'on what can we do to get credible savings on cost control that the Congressional Budget Office would recognize and score as savings in this law.'
Posts
No comments:
Post a Comment