The Republican presidential debate in Tampa, Fla., co-hosted by CNN and the Tea Party Express, was feisty and provocative, with many of the candidates relying once again on bogus “facts” that we have previously identified as faulty or misleading.
The debate marked a remarkable shift in tone by Texas Gov. Rick Perry on the issue of Social Security, barely five days after he labeled the venerable old-age program “a Ponzi scheme” doomed to fail. This week, he said it was a “slam dunk guaranteed” for people already on it.
Last week, we explained why the Ponzi scheme label was not true — and also provided readers with a primer on Social Security for those who want to learn more. In Monday night’s debate, Perry and former Mass. Gov. Mitt Romney tangled over the issue again, and Romney had better command of the facts, as far as the two men’s books were concerned.
“The real issue is that in writing his book Governor Perry pointed out that, in his view, that Social Security is unconstitutional, that this is not something the federal government ought to be involved in, that instead it should be given back to the states … . Governor Perry, you’ve got to quote me correctly. You said ‘it’s criminal.’ What I said was Congress taking money out of the Social Security Trust Fund is like criminal, and that is, and it’s wrong.”
— Mitt Romney
Romney gets points for correctly quoting both Perry’s book, “Fed Up,” and his own book, “No Apology.” On page 58, Perry labels Social Security, Medicare, Medicaid and even unemployment insurance as “unnecessary, unconstitutional programs.” While promoting his book last year on MSNBC’s “Morning Joe,” Perry went further, suggesting Social Security should be dismantled and simply become a state responsibility.
“Get it back to the states. Why is the federal government even in the pension program or the health-care delivery program?” Perry said on Nov. 5, 2010. He said that ending the federal government’s role in Social Security would be “one of the ways this federal government can get out of our business.”
(Perry also added: “I wouldn’t have written that book if I wanted to run for presidency of the United States. … I have no interest in going to Washington.”)
Romney’s book, by contrast, contains mostly a sober description of various ways to fix the long-term funding problems of Social Security, with the exception of the suggestion that members of Congress are doing something criminal with Social Security funding (page 158). People can differ, but we think comparing Social Security (a government retirement and disability insurance program) to a trust fund managed by a bank is an inappropriate analogy.
“We know that President Obama stole over $500 billion out of Medicare to switch it over to Obamacare.”
— Rep. Michele Bachmann (Minn.)
“He cut Medicare by $500 billion. This, the Democrat president, the liberal, so to speak, cut Medicare — not Republicans, the Democrat.”
Bachmann in particular loves to make this claim, but we have repeatedly explained why it just isn’t correct.
Under Obama’s health-care law, Medicare spending continues to go up year after year. The law tries to identify ways to save money, and so the $500 billion figure comes from the difference over 10 years between anticipated Medicare spending (what is known as “the baseline”) and the changes the law makes to reduce spending.
The savings actually are wrung from health-care providers, not Medicare beneficiaries. These spending reductions presumably would be a good thing, since virtually everyone agrees that Medicare spending is out of control.
In fact, in the House Republican budget this year, lawmakers repealed the Obama health-care law but retained all but $10 billion of the nearly $500 billion in Medicare savings, suggesting the actual policies enacted to achieve these spending reductions were not that objectionable to GOP lawmakers. So it is misleading for Romney to say that Republicans did not make these cuts.
For a more detailed explanation, please see our longer examination of this subject in June, when we gave Bachmann two Pinocchios for making this claim at the first GOP debate.
“Let me say I helped balance the budget for four straight years, so this is not a theory”
— Former House Speaker Newt Gingrich (Ga.)
Gingrich at least indicates there was a president — Bill Clinton — when the nation briefly began to run budget surpluses. And certainly the Republican Congress led by Gingrich prodded Clinton to move to the right and embrace such conservative notions as a balanced budget.
But the budget was balanced in part because of a gusher of tax revenues from Clinton’s 1993 deficit-reduction package, which raised taxes on the wealthy and which Gingrich vehemently opposed. The budget was also balanced because the Democratic White House and Republican Congress were in absolute legislative stalemate, so neither side could implement grand plans to increase spending or cut taxes.
Gingrich is wrong to suggest there were four years of balanced budgets when he was speaker. He left in January 1999; the budget ran a surplus in the fiscal years 1998, 1999, 2000 and 2001. So he can at best claim two years.
During the surplus years, moreover, the gross debt (including bonds issued to Social Security and Medicare) rose by $400 billion. Gross debt is the figure that conservatives tend to use. During Gingrich’s time as speaker, the public debt was essentially flat and the gross debt rose $700 billion.
Obama “had $800 billion worth of stimulus in the first round of stimulus. It created zero jobs.”
Perry is wrong. The surplus created jobs; it also saved jobs. But there has not been a net gain in jobs because so many jobs were lost early in Obama’s presidency. Since the stimulus bill was signed, the number of overall jobs in the United has declined by about 1.9 million.
Economists differ on the effectiveness of the stimulus, but most say it has at least some effect (ie, created at least some jobs.) A recent review of nine different studies on the stimulus bill found that six studies concluded the stimulus had “a significant, positive effect on employment and growth,” and three said the effect was “either quite small or impossible to detect.”
“I was one of the only people in Washington that said: Do not raise the debt ceiling. Don’t give the president of the United States another $2.4 trillion blank check. You’ve got to draw the line in the sand somewhere and say: No more out-of-control spending.”
Ever hear of a “blank check” with a number attached to it? In any case, Congress has already committed to spend much of this money, under budgets passed in previous years. Lifting the debt ceiling merely means that the Treasury now has the authority to make good on bills that are coming due.
“We have cut taxes by $14 billion, 65 different pieces of legislation.”
That’s one side of the ledger. We are not sure if Perry’s figure is correct but as Politifact Texas has documented, he has also raised taxes repeatedly, including on cigarettes, to make up revenue for cuts in local property taxes.
“What we saw with all of the $700 billion bailout is that the Federal Reserve opened its discount window and was making loans to private American businesses, and not only that, they were making loans to foreign governments. This cannot be.”
Bachmann is significantly overstating the case. Bloomberg News, which filed the Freedom of Information Act request that resulted in the disclosure of the Fed loans to foreign banks (some of which had had some government ownership), noted: “The Monetary Control Act of 1980 says that a U.S. branch or agency of a foreign bank that maintains reserves at a Fed bank may receive discount-window credit.” All of the loans were paid back, according to Fed officials.
“And I happen to think that what we were trying to do was to clearly send the message that we’re going to give moms and dads the opportunity to make that decision with parental opt-out. Parental rights are very important in the state of Texas. We do it on a long list of vaccines that are made.”
Perry skated close to the edge of the truth here as he tried to defend his controversial order to require the vaccine that is said to prevent cervical cancer. As Politifact Texas reported in 2010, Perry “ordered the Department of State Health Services to allow parents dissenting for philosophical or religious reasons from all immunizations — not just this one — to request a conscientious objection affidavit form.”
Just 0.28 percent of students filed such forms, which must be updated every two years to remain viable — and not all private schools accept the form. So as many as 15 percent of girls did not have the possibility of opting out of the requirement to receive the vaccine if they wanted to continue in their schools.
While Romney denied Bachmann’s charge that there was a connection between his order and a $5,000 campaign donation, Texas media reported that Perry’s chief of staff held a meeting on the vaccine plan on the same day the donation was received. Perry’s aides said the timing was a coincidence.
“This is the election that’s going to decide if we have socialized medicine in this country or not. This is it. Why? I just have to say this. It’s because President Obama embedded $105,464,000,000 in Obamacare in postdated checks to implement this bill.”
It’s wrong to say the health-care law — which builds on the existing private system — will result in socialized medicine, but apparently some people will never be convinced.
But Bachmann’s assertion of $105 billion “embedded” in the health-care law is another bogus claim for which she has previously earned four Pinocchios. We looked closely at her assertion in March and concluded that her charge that this money was “hidden” does not have credibility. The money for these programs was clearly described and analyzed by the Congressional Budget Office before the legislation was voted into law. And since then, the Obama administration has issued a new release every time it spent some of the funds.
By: Glenn Kessler, The Fact Checker, The Washington Post, September 13, 2011
When Florida Gov. Rick Scott (R) signed the law requiring welfare recipients to pass annual drug tests to collect benefits, he justified the likely unconstitutional law by saying it would save the state money by keeping drug users from using public money to subsidize their drug habits. Drug use, Scott claimed, was higher among welfare recipients than among the rest of the population.
Preliminary results from the state’s first round of testing, however, has seemingly proven both of those claims false. Only 2 percent of welfare recipients failed drug tests, meaning the state must reimburse the cost of the $30 drug tests to the 96 percent of recipients who passed drug tests (two percent did not take the tests). After reimbursements, the state’s savings will be almost negligible, the Tampa Tribune reports:
Cost of the tests averages about $30. Assuming that 1,000 to 1,500 applicants take the test every month, the state will owe about $28,800-$43,200 monthly in reimbursements to those who test drug-free.
That compares with roughly $32,200-$48,200 the state may save on one month’s worth of rejected applicants.
Net savings to the state: $3,400 to $5,000 annually on one month’s worth of rejected applicants. Over 12 months, the money saved on all rejected applicants would add up to $40,800 to $60,000 for a program that state analysts have predicted will cost $178 million this fiscal year.
While the state will save little, if any, money on the drug testing racket, Scott’s family could stand to gain financially. A former health care executive, Scott founded Solantic Corp., a chain of walk-in health care clinics that provides, among other services, drug tests. Scott maintains that he has no involvement in the company, but he does have $62 million worth of the company’s shares contained in a blind trust under his wife’s name. Though there is no conflict under Florida law unless the company deals with the governor’s office directly, the company, and thus Scott’s investment, could benefit from the increased traffic from drug tests.
Meanwhile, the state’s already-small annual savings could be wiped out entirely by the cost of implementing the program and issuing the reimbursements. And as Derek Newton, the spokesman for the Florida chapter of the American Civil Liberties Union, told the Tribune, the cost of the program could skyrocket if the state has to defend it in court. The ACLU is still considering a lawsuit challenging the law’s constitutionality, Newton said.
If the ACLU or anyone else were to challenge the law, the lawsuit would likely succeed. As UCLA law professor Adam Winkler wrote after Scott signed the law, “Random drug-testing is what is known as a ‘suspicion-less search,’” and outside of a few limited instances, courts have “generally frowned upon” drug testing that occurs at random and without probable cause. “Indeed, courts have stuck down policies just like the ones put in place by Florida,” Winkler wrote, citing two cases to back up the claim.
As for Scott’s second claim, that drug use is higher among welfare recipients, the test results also show that to be false. While only 2 percent of welfare recipients failed drug tests, a 2008 study by the Office of National Drug Control Policy found that approximately 8 percent of Floridians age 12 and up had used illegal drugs in the last month, and 9.69 percent had smoked marijuana in the last year.
By: Travis Waldron, Think Progress, August 24, 2011
Gov. Rick Scott May Personally Benefit From New Law That Hands Medicaid Program Over To Private Companies
Florida Gov. Rick Scott (R) signed “a landmark Medicaid overhaul” yesterday that will put “hundreds of thousands of low-income and elderly Floridians into managed-care plans.” The proposal “gives managed care companies more control over the program that’s paid for with federal and state money,” a shift the state GOP claims will “hold down spiraling costs in the $20 billion program.” However, as TP Health editor Igor Volsky pointed out, a five-county pilot program in Florida already revealed that such a plan produces “widespread complaints and little evidence of savings.” Under managed care, states “have to ensure that private payers aren’t looking out for short term profits by denying treatments or reducing reimbursement rates” and — given what occurred during the pilot program — the results “are already less than promising.”
But Scott may have another reason to push a dubious bill into law. As Mother Jones reported, one of the private managed-care companies that stand to gain from the new law is Solantic, “a chain of urgent-care clinics aimed at providing emergency services to walk-in customers. Solantic was founded in 2001 — by none other than Rick Scott:
The Florida governor founded Solantic in 2001, only a few years after he resigned as the CEO of hospital giant Columbia/HCA amid a massive Medicare fraud scandal. In January, according to the Palm Beach Post, he transferred his $62 million stake in Solantic to his wife, Ann Scott, a homemaker involved in various charitable organizations.[...]
“This is a conflict of interest that raises a serious ethical issue,” says Marc Rodwin, a medical ethics professor at Suffolk University Law School in Boston. “The public should be thinking and worrying about this.”
Scott’s office dismissed the conflict of interest concern as “incorrect and baseless.” However, Scott’s history of fraud with entitlement programs (in that case Medicare) should certainly raise a red flag here. And it is not as if Scott is completely clean when it comes to the mix between professional office and personal interest.
Incidentally, Scott also just signed a bill that will require anyone applying for welfare benefits to pay for a drug test to qualify for benefits. They will only recoup that fee if they pass. One company that provides such drug tests? Solantic.
By: Tanya Somander, Think Progress, June 3, 2011
There’s increasingly an understanding that the mixture of cuts and taxes in Paul Ryan’s budget aren’t quite fair, and the underlying assumptions it uses don’t quite work. But it’s left people hungry for a budget that does work, and annoyed that Democrats haven’t provided one. “If Democrats don’t like his budget ideas, they should propose their own,” writes Fareed Zakaria. “The Democrats and Obama now have to offer a response,” warned Andrew Sullivan. “As of this evening, the Democratic policy plan consists of yelling ‘You suck!’” complained Megan McArdle.
I’ve made similar comments. And I think those comments are mostly right. Democrats need to step up on taxes, on defense and non-defense discretionary, on Social Security, and on energy. But there’s one huge, glaring exception: controlling health-care costs. There, the reality is that Democrats have a plan and Ryan doesn’t. But the perception, at this point, is just the opposite.
At the heart of Ryan’s budget are policies tying the federal government’s contribution to Medicare and Medicaid to the rate of inflation — which is far, far slower than costs in the health-care sector typically grow. He achieves those caps through cost shifting. For Medicaid, the states have to figure out how to save the money, and for Medicare, seniors will now be purchasing their own insurance plans and, in their new role as consumers, have to figure out how to save the money. It won’t work, and because it won’t work, Ryan’s savings will not materialize.
Even Ryan’s fans agree you can’t hold health-care costs down to inflation. But even if you grant that Ryan’s target is too low, his vision for reforming Medicare would like miss a more reasonabke target, too. Consider the program Ryan names as a model. He said his budget converts Medicare into “the same kind of health-care program that members of Congress enjoy.” The system he’s referring to is the Federal Employee’s Health Benefits Program, and cost growth there has not only massively outpaced inflation in recent years, but actually outpaced Medicare, too. Ryan’s numbers are so fantastic that Alice Rivlin, who originally had her name on this proposal, now opposes it.
Democrats don’t just have a proposal that offers a more plausible vision of cost control than Ryan does. They have an honest-to-goodness law. The Affordable Care Act sets more achievable targets, and offers a host of more plausible ways to reach them, than anything in Ryan’s budget. “If this is a competition betweenRyan and the Affordable Care Act on realistic approaches to curbing the growth of spending,” says Robert Reischauer, who ran the Congressional Budget Office from 1989 to 1995 and now directs the Urban Institute, “the Affordable Care Act gets five points and Ryan gets zero.”
The Affordable Care Act holds Medicare’s cost growth to GDP plus one percentage point, which makes a lot more sense. It’s the target Ryan’s Medicare plan originally used, back when it was called Ryan-Rivlin. But the target is not really the important part. The important part is how you achieve the target. And the Affordable Care Act actually includes reforms and new processes for future reforms that would help Medicare — and the rest of the medical system — get to where the costs can be saved, rather than just shifted.
The Affordable Care Act’s central hope is that Medicare can lead the health-care system to pay for value, cut down on overtreatment, and cut out treatments that simply don’t work. The law develops Accountable Care Organizations, in which Medicare pays one provider to coordinate all of your care successfully, rather than paying many doctors and providers to add to your care no matter the cost or outcome, as is the current practice. It also begins experimenting with bundled payments, in which Medicare pays one lump-sum for all care related to the successful treatment of a condition rather than paying for every piece of care separately. To help these reforms succeed, and to help all doctors make more cost-effective treatment decisions, the law accelerates research on which drugs and treatments are most effective, and creates and funds the Patient-Centered Outcomes Research Institute to disseminate the data.
If those initiatives work, they head over to the Independent Payment Advisory Board (IPAB), which can implement cost-controlling reforms across Medicare without congressional approval — an effort to make continuous reform the default for Medicare, even if Congress is gridlocked or focused on other matters. And if they don’t work, then it’s up to the Center for Medicare and Medicaid Innovation, a funded body that will be continually testing payment and practice reforms, to keep searching and experimenting, and when it hits on successful ideas, handing them to the IPAB to implement throughout the system.
The law also goes after bad and wasted care: It cuts payments to hospitals with high rates of re-admission, as that tends to signal care isn’t being delivered well, or isn’t being follow up on effectively. It cuts payments to hospitals for care related to infections caught in the hospitals. It develops new plans to help Medicare base its purchasing decisions on value, and new programs to help Medicaid move patients with chronic illnesses into systems that rely on the sort of maintenance-based care that’s been shown to successfully lower costs and improve outcomes.
I could go on, but instead, I’ll just link to the Kaiser Family Foundation’s excellent primer (pdf) on everything the law does. The bottom line is this: The Affordable Care Act is actually doing the hard work of reforming the health-care system that’s needed to make cost control possible. Ryan’s budget just makes seniors pay more for their Medicare and choose their own plans — worthy ideas, you can argue, but ideas that have been tried many times before, and that have never cut costs in the way Ryan’s budget suggests they will.
That’s why, when the Congressional Budget Office looked at Ryan’s plan, they said it would make Medicare more expensive for seniors, not less. The reason the deficit goes down is because seniors are paying 70 percent of the cost of their insurance out-of-pocket rather than 30 percent. But that’s not sustainable: We’ve just taken the government’s medical-costs problem and pushed it onto families.
No one who knows health-care policy will tell you that the Affordable Care Act does everything we need to do in exactly the way we need it done. That’s why Resichauer gave it a five, not a 10. But it does a lot of what we need to do and it sets up systems to help us continue doing what’s needed in the future.
Ryan’s proposal, by contrast, does almost none of what we need to do. It appeals to people who have an ideological take on health-care reform and believe we can make Medicare cheaper by handing it over to private insurers and telling seniors to act like consumers. It’s a plan that suggests health-care costs are about insurance, as opposed to about health care. There’s precious little evidence of that, and when added to the fact that Ryan’s targets are so low that even his allies can’t defend them, the reality is that his savings are largely an illusion.
The Affordable Care Act has taken a lot of hits. It’s not popular, and though very few of the political actors confidently attacking or advocating it can explain the many things it’s doing to try and control costs, people have very strong opinions on whether it will succeed at controlling costs. But the irony of everyone demanding Democrats come up with a vision for addressing the drivers of our deficit in the years to come is that, on the central driver of costs and the central element of Ryan’s budget, Democrats actually have something better than a vision. They have a law, and for all its flaws, their law actually makes some sense. Republicans don’t have a law, and their vision, at this point, doesn’t make any sense at all.
By: Ezra Klein, The Washington Post, April 8, 2011
Florida Gov. Rick Scott is one of the most entertainingly shameless figures in American political life. In the 1990s, Scott headed Columbia/HCA Healthcare, the largest for-profit hospital in America. While Scott was running Columbia/HCA Healthcare, it got involved in a bit — okay, a lot — of fraud. As Forbes reported, the company “increased Medicare billings by exaggerating the seriousness of the illnesses they were treating. It also granted doctors partnerships in company hospitals as a kickback for the doctors referring patients to HCA. In addition, it gave doctors ‘loans’ that were never expected to be paid back, free rent, free office furniture, and free drugs from hospital pharmacies.”
The scale of the fraud was so immense that Columbia/HCA Healthcare ended up paying more than $2 billion (PDF) back to the federal government in the single largest fraud case in history. (The previous record holder? Drexel Burnham.) Scott resigned shortly before the judgment came down.
Today, Scott is enjoying a second act as governor of Florida. And, as Suzy Khimm reports, he doesn’t seem all that chastened. Before running for office, he turned his $62 million stake in Solantic, the urgent-care clinic chain he founded after resigning from Columbia/HCA Healthcare, over to a trust in his wife’s name. Solantic doesn’t take traditional Medicaid, but it does work with the private HMOs that, under a 2005 pilot program, were allowed to contract with Medicaid. And Scott is now pushing a bill that would expand that program across the state making those HMOs — the ones Solantic works with — the norm for Medicaid.
Asked about the apparent conflict of interest, Scott said, “If you look at everything that I want to accomplish in health care in Florida is basically what I’ve believed all my life. I believe in the principle that if you have more competition it will drive down the prices.” And I believe him. But he could have sold his stake in Solantic when he got into government. Since he didn’t, the fact remains that Scott is pushing a policy his family stands to profit from immensely . Which is, for Scott, real progress. In the 1990s, he made his money off single-payer health-care programs by cheating them. Today, he’s making his money off single-payer health-care programs by running them. No matter how you look at it, it’s a step up.
By: Ezra Klein, The Washington Post, March 25, 2011