A Project of The Annenberg Public Policy Center

Pataki’s Bogus Health Care Claims

The ex-governor's group makes some false claims in ads attacking Democrats who voted for the new law.


Summary

A conservative group led by former New York Gov. George Pataki has launched two nearly identical ads criticizing Democratic Reps. Carol Shea-Porter of New Hampshire and John Hall of New York for voting for the new health care law. Pataki said the group, called Revere America, would target 10 other Democrats. The ad makes several false and unsubstantiated claims:

  • It claims that the law creates "longer waits in doctors’ offices" and that "your right to keep your own doctor may be taken away." The group says those claims are about a Medicare payment program that the law calls for establishing. But it points to an opinion piece that doesn’t make those claims at all. The author tells us it’s "bogus" to cite his article as support for the ad.
  • The ad falsely calls the health care law "government-run health care." The truth is that — while the legislation will expand regulation of the insurance industry — it builds on our current private health care system and expands business for private insurers.
  • The ad claims "costs will go up," when, in fact, premium costs for most Americans are predicted to stay the same or decrease slightly from where they normally would be. And for many others, federal subsidies will offset premium increases.

Revere America says it wants to repeal the health care law and replace it with Republican ideas.

Analysis

Revere America is yet another 501(c)(4) organization that doesn’t have to disclose its donors — we’ve seen several such groups in this election cycle. Former New York Gov. Pataki has appeared as a spokesman for the group. Political Director Christopher Larson told us the group hopes to spend "several million" before Election Day. Revere America favors repeal of the health care law, the Patient Protection and Affordable Care Act, and Pataki said the group would oppose about a dozen Democratic members of Congress.

So far, the group’s ad has aired against Reps. Carol Shea-Porter of New Hampshire and John Hall of New York, both of whom are in toss-up races, according to the Cook Political Report and the Rothenberg Report (which rates Hall’s race as "tilt Democrat" and Shea-Porter’s as "tilt Republican"). Another similar ad targets Ann McLane Kuster, a Democratic House candidate in New Hampshire.

[TET ] Revere America Ad: Defeat Hall

Announcer: Congressman Hall voted for Obamacare. Government-run health care, it’s a bad plan. Government bureaucrats will benefit. Seniors will get hurt. Costs will go up. Care will go down. Longer waits in doctors’ offices. Your right to keep your own doctor may be taken away. It’s a plan we didn’t want and don’t need. But Hall voted for it anyway. Defeat Congressman Hall. Revere America is responsible for the content of this advertising. [/TET]

Speculation Masquerading as Fact

The Revere America ad makes several general claims about the health care law, such as "care will go down," without citing any support or giving any specifics. Then it says that the law would create "longer waits in doctors’ offices," and it makes the curious claim that "your right to keep your own doctor may be taken away."

Unfortunately for viewers, the ad gives no indication that these claims are opinion and speculation from Revere America, and are related to its opposition to a provision in the health care law that calls for setting up a new payment model for Medicare services. When we asked for back-up for the claims, the group sent us a two-page document that didn’t cite any study or report that showed longer waits in doctors’ offices or a threat to anyone’s ability to keep his or her own doctor. Rather, the group pointed to an opinion piece by a health care expert who doesn’t think a concept called "accountable care organizations" will work to reduce costs — but who didn’t say anything about packed waiting rooms or a "right" to keep you doctor. When we contacted the author, Jeff Goldsmith, president of Health Futures Inc. and an industry analyst, and told him his piece was being cited in the support for these claims, he responded: "That’s not what I said. … To cite my article — no, that’s bogus."

Goldsmith’s point was that accountable care organizations won’t be effective in saving money, "that they’re not going to work, not that they’re going to massively interfere" with patient care or choice, he says.

His piece was published by the journal Health Affairs, which ran another opinion piece three days later by experts in favor of accountable care organizations. They say these ACOs "represent a critical step in moving away from purely volume-driven payments to payments based on what we really want to support: better health and better care at a lower cost."

We’ve seen weak attempts to back-up claims in political ads before, and Revere America’s is certainly among the weakest.

Accountable Care Organizations

What’s an accountable care organization, or ACO? It’s a group of health care providers that work together to coordinate care for a group of patients with the goal of improving outcomes and reducing costs. If the ACO can do that, and spend less collectively than it would have been expected to under the traditional fee-for-service Medicare model, the ACO gets a bonus payment, splitting the savings. ACOs may be virtual organizations, and patients don’t actually know that they’re part of one. The model is one idea to reduce medical errors, duplicative or unnecessary care, a lack of coordination, and other issues that increase medical costs. Pushing the idea are Dartmouth’s Institute for Health Policy and Clinical Practice and the Brookings Institution’s Engelberg Center for Health Care Reform, which have teamed up to create the Accountable Care Organization Learning Network to provide resources for those exploring the concept. (There’s much more about the idea on the Dartmouth-Brookings site.)

Will it work? We can’t say — and neither can Revere America. The new health care law calls for finding out, and for testing other payment models for Medicare. The law calls for establishing an ACO program by Jan. 1, 2012, and requires reports to be filed, outcomes to be evaluated, and agreements with ACO projects to be terminated if they don’t "meet the quality performance standards established by the Secretary" of Health and Human Services.

The idea does have its critics, including Goldsmith. But Goldsmith didn’t claim that patients would suffer. When we asked him if he was concerned that ACOs would hurt the quality of care, he said: "No. They’re not going to do anything." And that was the point of his article, which said ACOs wouldn’t be able to reduce costs and that the collaboration just won’t happen between doctors and hospitals. Goldsmith concluded:

Goldsmith: The sad reality is that most hospitals, even the well-managed ones, simply lack the tools, leadership, and leverage to enable them to bear and manage global risk. … [T]he core idea remains that physician communities and hospitals in defined geographies are viable economic units. They are not. The ACO idea may be worth experimenting with, but if recent history is any guide, it is not an idea worth betting the Medicare programs’s future on. As a vehicle for reorganizing medical practice at the community level, ACOs are not ready for prime time.

Imaginary Rights

Our ears perked up when the announcer in the ad said that "your right to keep your own doctor may be taken away" by the health care law. We know of no such "right" in law or anywhere else. As we’ve said before — when pointing out that President Obama can’t promise all Americans that they can keep their doctor — employers remain free to switch plans or change coverage, just as they were before the law took effect.

But Revere America believes choice of doctor wouldn’t exist for Medicare beneficiaries who find themselves in ACO programs. The group’s back-up flatly states, without any support: "There is no way to guarantee individual patient choice of a physician in such organizations." But that opinion is directly contradicted by the Centers for Medicare & Medicaid Services, the agency tasked with implementing ACOs; the experts who developed this payment model; and Goldsmith, whose article Revere America cited as support. 

CMS published a preliminary Q&A about Medicare ACOs (none of these programs actually exists yet, and there are still many details to be worked out). CMS says that Medicare beneficiaries will be "assigned" to ACOs based on the care they already receive, but they won’t even know they’re part of the organization. "Assignment will be invisible to the beneficiary, and will not affect their guaranteed benefits or choice of doctor. A beneficiary may continue to seek services from the physicians and other providers of their choice, whether or not the physician or provider is a part of an ACO."

That echoes what proponents of the idea have said about the model they created. The Health Affairs piece written by Brookings’ Aaron McKethan and Mark McClellan and Dartmouth’s Elliott Fisher and Jonathan Skinner said that "[n]othing about the ACO model locks in patients to any specific provider or group of providers." They further explain the "assignment" to ACOs: "It is true that to provide insights into patterns of patient care, ACOs use patient attribution methods to set annual spending benchmarks and track overall spending at an ACO population level. But these measures are derived from actual practice patterns driven by patient choice and ongoing provider referrals."

When we asked Revere America if it had anything more to back up its claim about keeping your doctor, Political Director Christopher Larson simply told us that in order to control costs "[t]here will be great pressure not to allow patients simply to see the doctor they want to see whenever they want to see him/her," and pointed to another opinion piece by the president of a conservative think tank.

We take no position on the viability of ACOs, and we’d certainly agree that there’s plenty of debate and discussion to be had on this payment model, and others. But the Revere America ad doesn’t even give voters an inkling that this is the aspect of the new law to which it is referring. And the group’s back-up for the ad fails to offer support for its opinions on what ACOs would mean for patients.

Government-Run Mantra

The ad also makes some tired claims, including the false assertion that the law creates "government-run health care." But no matter how many times opponents to the legislation repeat this mantra, it’s still not true. That’s much to the disappointment of those who actually wanted a government-run system and complained from the early days of debate that they were being shut out by the White House and leading congressional Democrats.

Indeed, the final legislation doesn’t come anywhere close to a system in which the government is the insurer or provider of health care. Instead, the law keeps the country’s primarily private health insurance system in place — in fact, it creates a lot more business for private insurers since it requires individuals to have a policy. There is an expansion of Medicaid and the Children’s Health Insurance Program for low-income persons: The nonpartisan Congressional Budget Office estimates that by 2019, 16 million will join Medicaid and CHIP as a result of the law and 16 million will be added to private insurance rolls. (Those numbers are in addition to those who would have gained or lost such insurance in the absence of the legislation.)

The ad also claims that "government bureaucrats will benefit." How? According to Revere America, by holding jobs. The fact sheet for the ad says the new law "creates over 50 new federal government entities," an assertion that it says comes from the Republican staff of the House Joint Economic Committee. We fact-checked a similar claim about the House bill a year ago. While a few items on the GOP list were funding mechanisms, it’s true that the law would create many new programs and staff positions.

Revere America also repeats in its back-up a bogus Republican talking point that the law requires up to 16,500 new IRS personnel. As we’ve said twice now, that figure "stems from a partisan analysis based on guesswork and false assumptions." We broke down how GOP House members came up with the number in March.

Vague Claim about Seniors

The ad makes another general claim, this one about seniors, saying they "will get hurt." How? Revere America cites cuts to Medicare, specifically reductions in payments to Medicare Advantage plans.

We’ll repeat the facts we’ve cited before: The law says that traditional Medicare benefits cannot be cut, and, in fact, it actually expands some coverage, adding free preventive services and increasing prescription drug coverage. But it’s true that Medicare Advantage will be affected. The 10 million seniors on these private health plans often get extra benefits — gym memberships or extra eyeglasses — since the government pays Medicare Advantage plans more per enrollee, on average, than it does traditional Medicare. The law calls for reducing the MA payments over time until they are in line with traditional Medicare. This means those extras could go away, and some seniors would switch to regular Medicare, once Advantage plans dropped those incentives.

As for cuts to Medicare, the law doesn’t cut current spending but does reduce the growth in future spending by $555 billion over 10 years. In two reports this year, the chief actuary of CMS wrote that the spending reductions could make business tough for some health care providers but that Congress was likely to override these reductions, just as lawmakers have done for other scheduled Medicare cuts in recent years.

Higher Costs?

The ad also says that "costs will go up." What costs? Revere America’s back-up points to new taxes on drugs, medical devices and insurance — saying that the taxes will be passed along to consumers in the form of higher premiums. It’s true that taxes are often passed along to consumers, but with the health care law, the nonpartisan Congressional Budget Office found that premium costs for most people won’t change significantly.

The CBO estimated that for those with insurance from employers, their premiums would largely stay the same. The average premium for those in the large group market would drop by between 0 percent and 3 percent, compared with what the cost would be without the health care law in 2016. The average cost in the small group market would experience between a 1 percent increase and a 2 percent decrease.

One area would see increased costs: Those who buy their own insurance (the non-group market) would see the average premium go up by 10 percent to 13 percent. The reason for the hike is that benefits also would increase for this market, and most of those buying their own coverage (57 percent) would get subsidies, which would encourage them to purchase more expensive, and expansive, plans than they otherwise would. Those subsidies also would push down the out-of-pocket cost for those individuals substantially.

As for those taxes on drugs and medical devices, the CBO said that the fees would be passed along, but this would "add about 1 percent to the affected premiums," according to the Joint Committee on Taxation.

— by Lori Robertson

Sources

RevereAmerica.org. FACT SHEET AND DOCUMENTATION FOR REVERE AMERICA TV AD. Sep 2010.

Goldsmith, Jeff. "The Accountable Care Organization: Not Ready For Prime Time." Health Affairs Blog. 17 Aug 2009.

Goldsmith, Jeff, president of Health Futures Inc. Interview with FactCheck.org. 6 Oct. 2010.

McKethan, Aaron and Mark McClellan. "Moving From Volume-Driven Medicine Toward Accountable Care." Health Affairs Blog. 20 Aug 2009.

Overview of the Accountable Care Organization (ACO) Model. Brookings-Dartmouth ACO Learning Network website. accessed 6 Oct 2010.

H.R. 3590. The Patient Protection and Affordable Care Act. enacted 23 Mar 2010.

Centers for Medicare & Medicaid Services. Medicare “Accountable Care Organizations” Shared Savings Program – New Section 1899 of Title XVIII. Preliminary Questions & Answers. CMS/Office of Legislation. 2010.

Goodman, John. "Deconstructing the Latest Health Care Fad: Accountable Care Organizations." The Heartland Institute. 30 Sep 2010.

Congressional Budget Office. Letter to Rep. Nancy Pelosi. 20 Mar 2010.

Congressional Budget Office. Letter to Sen. Evan Bayh. 30 Nov 2009.

Congressional Budget Office. CBO’s Analysis of Premiums Under the Chairman’s Mark of the America’s Healthy Future Act. Director’s blog. 23 Sep 2009.

Jackson, Brooks. "IRS Expansion." FactCheck.org. 30 Mar 2010.

Miller, Joe. "Boustany’s Response." FactCheck.org. 10 Sep 2009.

Novak, Viveca. "Misleading Onslaught by 60 Plus." FactCheck.org. 17 Sep 2010.