Politico Magazine: Levin, Waxman and Miller -- The Latest GOP Lie About Obamacare
There’s a saying that “nothing is more admirable in politics than a short memory.” But we are amazed by the audacity of the latest attack by Republican leaders on the Affordable Care Act.
The target of Republicans’ new criticism is a sensible mechanism to ensure an even distribution of risks across insurance companies. According to Republican leaders like House Budget Chairman Chairman Paul Ryan of Wisconsin, these risk corridor provisions are “massive insurance company bailouts.” Florida Sen. Marco Rubio has even introduced a bill to strip them from the ACA. Some conservative groups are calling them “nothing more than a built-in, blank check bailout for insurance companies.”
What’s most remarkable about their comments on risk corridors is that Republican leaders are denouncing a model they created to smooth out rate increases in prescription drug coverage under Medicare. When Senate Minority Leader Mitch McConnell voted in 2003 to create Medicare Part D, he called the law “the most important social legislation … in my memory” and said it provided “a genuine opportunity for the private sector to actually compete in offering this new drug benefit.” House Republican Leader John Boehner made similar comments, noting in 2007, “By almost every measure, this drug benefit has exceeded expectations, and it continues to score high marks among seniors for providing big savings on their prescription costs.”
An innovative part of the law McConnell and Boehner voted for was its “risk corridors” program, a new idea back in 2003. The corridors are a mechanism to distribute or balance risks across insurance companies, so that those that sign up healthier enrollees help those that attract sicker enrollees. Under the program, if insurers’ actual costs for medical claims are more than 3 percent below their expected costs, they will transmit a portion of their profits into the federal Treasury. Those funds will then be redistributed to insurers whose actual costs exceed their expected costs by more than 3 percent. The provisions were included in Medicare Part D to give the insurers confidence to enter a new market. And they worked.
At the time, Sen. Chuck Grassley (R-Iowa) described the Part D risk corridors as one of the “incentives that the secretary can use” to get the new plans started “in a strong way” and said that “on risk adjustment … these plans are enabling many beneficiaries to lower their out-of-pocket costs substantially, and that’s particularly true for beneficiaries with chronic illnesses.” The Bush administration highlighted the risk corridors as a strategy to “insure against higher than expected drug costs.” Notably, the Part D risk corridors are a permanent feature of the program.
When congressional Democrats wrote the Affordable Care Act, we included the exact same mechanism, except we made the risk corridors a temporary three-year program to create stability during the startup period. We also made the program less generous, with higher thresholds for risk-sharing than the Republicans included in Part D.
Given this history, and the fact that our risk corridor program is more conservative than the Part D version in both eligibility and duration, the new GOP attacks on the Affordable Care Act ring hollow. Some are blatantly dishonest, while others are completely false. Rubio has warned that we are getting “closer to the reality that billions of dollars in taxpayer money is going to be used to bail out these exchanges.” In fact, this week, the nonpartisan Congressional Budget Office says the program will actually save the federal government $8 billion because collections from insurers will significantly exceed payments. And unlike Medicare Part D, which was not paid for, the Affordable Care Act reduces the deficit by more than $1.5 trillion.
Of course, attacks on the Affordable Care Act with no basis in fact are nothing new. From claiming that the law created “death panels” to insisting that the law is a government takeover of health care to arguing that the law would result in people being jailed for failing to purchase insurance, Republicans have continuously attacked the bill by spreading outright falsehoods.
We cannot stop Republicans from making disingenuous or dishonest attacks on the Affordable Care Act. Indeed, this seems to be their primary strategy for the 2014 midterm elections. But we can blow the whistle on hypocrisy.
That’s why we are calling the risk corridors the “McConnell-Boehner provision.” The Republican leaders in the Senate and House strongly supported this policy in Medicare Part D, which was our model in drafting the Affordable Care Act. Credit should be given where it is due.