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Myths and facts about ‘Obamacare’

Posted at 6:00 AM ET, 01/18/2011 By Glenn Kessler


House Republicans on Wednesday plan to press forward with their repeal of the health care bill passed last year. They have the votes, so passage is not in doubt. But the Democrats who control the Senate have no interest in following suit, and President Obama had pledged a veto. So this is mostly a symbolic act. But it does provide an opportunity to look back at some of the persistent myths about the legislation.

Some of the public confusion about what is in the bill is understandable. The long battle in Congress was often mind numbing except to a handful of policy experts, and key features were dropped or added along the way. Opponents often seized on small elements and exaggerated the impact, even if those provisions were no longer in the bill. Since the bill was passed ten months ago, polls indicate that Americans have a greater understanding of what ended up in the final version–and support for the overall law has slowly grown. During last year’s midterm elections, both and did yeoman work trying to pick apart the various claims made about the bill; The Washington Post also joined forces with Kaiser Health News to produce an excellent examination of myths and facts about the law.

Even so, a Kaiser Family Foundation poll as recently as September found that a sizeable group of seniors believed that the health-care overhaul contained provisions that are simply not in the bill. Here then is a review of some of the most persistent myths of the health care bill.

“This is a ‘government takeover’ of the health care system”

This snappy talking point is used by Republicans repeatedly to bash Obama’s crowing legislative achievement, but it is simply not true. In fact, labeled this claim the 2010 “lie of the year,” but that has not stopped lawmakers from making this claim. It will surely be heard again on the House floor during the repeal debate.

In many ways, the health care law resembles the Massachusetts reform enacted in 2006 under then Gov. Mitt Romney (a potential Republican rival of Obama in 2012). It builds on the existing private insurance system but adds requirements and incentives to ensure that most people have some form of health insurance.

Under the new law, there is no government alternative to the private system–this was a potential provision that was dropped during the congressional tussle–but the number of people who qualify for the existing federal-state Medicaid program for the poor will be expanded. States (or the federal government) will run “exchanges” — essentially marketplaces — in which private insurers will sell insurance to individuals and small businesses, but this should mean more people will get private insurance, not fewer. Tax credits will also be offered to people who have trouble buying private insurance.

Certainly, the law bolsters government regulation of the health care system, such as forcing insurance companies to no longer deny coverage to people who have existing medical conditions. People who currently do not have health insurance will be required to buy it. But the core of the health system in the United States will remain the existing private insurance market. So it in no way resembles the government-run health systems used in most industralized countries in the world.

“Medicare benefits will be cut–and payments will be cut to Medicare doctors”.

This was another GOP attack line during the campaign, though in many ways this was payback for the Democrats’ very effective use of the same charge against Republicans after the GOP took control of Congress in 1994 and attempted to pass a balanced-budget plan that sought to restrain growth in Medicare spending.

The politically radioactive word “cut” is a misnomer. Under the health care law, Medicare spending will continue to increase year after year, but at a slower than anticipated pace. Both parties, in theory, agree this would be a good thing. Medicare is the venerable government-run health care plan for Americans over 65, and one of the fastest-growing parts of the federal budget.

The health bill will reduce projected Medicare spending by $575 billion over ten years, primarily by reducing projected fees to hospitals and other providers and by reducing payments to private Medicare Advantage insurance plans. Benefits have also been added, eating into the overall projected savings, but the impact on the Medicare Advantage plans is unclear. Richard S. Foster, the chief actuary of the Medicare and Medicaid, has estimated that seniors may need to pay more in out of pocket costs for such plans. He has also cast serious doubt on whether the Medicare savings claimed in the second decade could be achieved without significant pain for many hospitals, nursing facilities and other providers.

In fact, since 1997, Congress all but once has waived a planned cut in Medicare payments to doctors, mostly recently in December. So depending on the political pressure, some of these projected “cuts” may never materialize in any case.

“A secretive government committee (‘death panels’) will be created to make end-of-life decisions about people on Medicare”

This claim, first made by former Alaska Gov. Sarah Palin, the 2008 GOP vice presidential candidate, has been thoroughly debunked and was labeled “lie of the year” in 2009 by Yet it persists in the popular imagination. The September Kaiser poll found that 30 percent of seniors still believed this to be the case–and 22 percent were not sure, meaning fewer than half knew the claim was false.

The charge stemmed from a proposed amendment to the bill that would have covered the cost of end-of-the-life planning discussions. Democrats quickly dropped the provision after the firestorm created by Palin’s assertion, even after it was proven to be factually incorrect.

But the issue remains politically sensitive. In late December, The New York Times reported that under new Medicare regulations for annual physical examination, “the government will pay doctors who advise patients on options for end-of-life care, which may include advance directives to forgo aggressive life-sustaining treatment.” The White House reversed course days later, ordering the Medicare agency to delete references to end-of-life planning in its new regulations.

“Repealing the bill will increase the deficit”

This is technically true–it comes from a Congressional Budget Office estimate–but we’ve documented before the problems with both this statement and the estimate. Democrats are sure to make this claim as they fight back against repeal, so here is a link to our previous post on this topic. Bottom line: This is a pretty shaky claim for Democrats to make, especially since the health care law was not really intended to reduce the deficit, but to reduce the number of uninsured Americans,

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