MIT economist Jonathan Gruber has, for a long time, been the go-to guy for people who want to defend the Senate bill. (Today Sen. John Kerry has an article on the Huffington Post defending the excise tax in which he quotes only one economist, Jonathan Gruber.) Gruber does not just support the Senate bill, he defends the bill by making completely ridiculous, over-the-top claims about the bill, which border dangerously close to outright lies. For months, I have wondered why Gruber was committing what I considered economic malpractice with his untruthful statements. I previously thought that he was just a guy who enjoyed the spotlight and was prone to exaggeration. Having recently found out that he received close to $400,000 from single source contracts with the Department of Health and Human Services to study the effect of the “President’s health care proposal,” I’m no longer as curious about his behavior.
For an example of Gruber’s nonsense, look at his statement in Ron Brownstein’s much published article on cost control, which Rahm Emanuel was telling everyone to read:
“I’m sort of a known skeptic on this stuff,” Gruber told me. “My summary is it’s really hard to figure out how to bend the cost curve, but I can’t think of a thing to try that they didn’t try. They really make the best effort anyone has ever made. Everything is in here….I can’t think of anything I’d do that they are not doing in the bill. You couldn’t have done better than they are doing.”
Like many over-the-top claims Gruber has made in interviews, this one is simply not true. There is single payer, drug re-importation, direct Medicare pharmaceutical price negotiation, a robust public option, a centralized reimbursement negotiator, single standardized insurance packages, turning all insurance companies into non-profits, eliminating direct-to-consumer drug advertising, creating a faster pathways for biosimilars—it is a long list of options. To put it simply, there are a lot of common proposals that could have saved the nation hundreds of billions on our health care costs that are not in the Senate bill.
The Senate bill does not contain every cost control idea out there, it does not even contain most of the cost control ideas that were part of Obama’s health care proposal during the campaign. Any health economist should know that. In fact, when the administration cut its secret deal with PhRMA that promised reform would not cost the drug industry more than $80 billion, Obama jettisoned a proven cost control idea that he advocated during his presidential campaign: drug re-importation.
In the many articles which quote Jonathan Gruber, I have never seen it disclosed that he was a paid consultant to the Obama Administration. For months I have been angry with Gruber because I thought he was simply an exaggerator whose dangerous love of the spotlight was hurting the efforts of progressives to make sure the Senate bill adopted more progressive cost control solutions. I could not understand how any health care expert could issue such blatant falsehoods about health care reform. Now it is clear something much more sinister was at play.





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Agreed. I’m not a health economist, but when I read the article I thought the guy must be nuts. Now I know he was just being paid to lie.
I kept reading this malarky over and over without knowing the original source. That’s what happens when you wait for the true believers get the message out first. They tell you what to believe long before wrapping the idea back to the source.
It’s worse than lying. He claims he believes this shit. So it’s faith based economics, based on the crassest form of data mining.
hummmmmmm, I wonder why EVERYONE forgot/forgets about taking the cap off FICA to solve society’s problems?
Jeeeeezus… This guy is like the Blackwater /Xe – Eric Prince mercenary of healthcare. Thank goddess my government pays this mercenary to destroy my fellow countrymen’s health, healthcare, and budget.
I want a refund.
well nothing else really explains this douchebags exaggerated claims. its not as if hes been harping on these same exaggerations for years, like any other big-name-school-economist with a pet crazy idea. he just recently got on the bandwagon in a big way, with a lot of rubbish no one had talked about. No one had talked about it because the insurance industry lobbyists hadn’t cooked it up yet over at the WH.
No refund, but you may have a credit which you can use at any doc-in-a-box any time. :)
Fair is fair.
If the banks can use tax payers’ money to lobby Congress against financial reform, the health care industry and its shills should be able to do likewise.
Just. Damn. Too many bad guys. Where’s the good guys and some feel good? Oh, I know the answer, I just can’t stay awake late enough to play with you at Late Late Night. *g*
Interesting, thanks for sharing this.
Transposition Correction: stoplight to spotlight
Personally, I like it better when the light is green.
- Tom ;-)
God… what distinguishes this from Bush’s paid propagandists disguised as pundits? or the many “content” articles released by paid shills from the Bush administration?
Jesus effing christ… propaganda you can believe in.
ehhh, yep!
No difference might as well bring back the Clintons, Rubin, Tenet, Sandy Berger, James Rubin et al. Oh I almost forgot, Robert Rubin.
ps… if they’d really wanted to bend the fucking cost curve (gov speak Orwell would be pround of)… they would start at the bottom with the entire medical care complex,
eg with controlling the costs and purchases of unnecessary hardware and equipment that drive up medical costs exponentially, not with the fucking middle man profit-making insurance companies.
Can you say Armstrong Williams? Can you say Maggie Gallagher? I thought you could.
Armstrong Williams,he still around ?
You think we can expect the so called librul pundit hosts on MSNBC to inform their viewers of this farce….. to fool Americans…hmmm..No
Thanks again for all your extraordinary work, Jon.
Jon … OT… but to counter some of the disinformation abounding on DK… some are still saying that mandates do not kick in til 2014 per the Senate bill… but I thought that they start shortly after Obama signed the bill, is that correct?
Thanks for being the go to guy on healthcare.
The tactic used by Rahm with Gruber is Cheneyeque.
First, create a set of “facts”. Then get the press stenographers to report the “facts”. Finally, to give the “facts” maximum credence, go to every media source possible and give quotes that cite the created “facts” that have been legitimized by reporters reporting on the “facts”.
This is really an outrage.
there you ‘ho again
Mornin’ All
In addition to the cost-saving measures Mr Walker mentions:
The establishment of a regulatory body to determine evidence-based, best practices protocols for all treatments, devices and drugs — no matter who provides or funds them.
Doctors and patients alike are deluded in thinking that medical practice in the United States is guided by sound science, innovation and clinical evidence. Read Atul Gawande’s New Yorker article “The Cost Conundrum” (June 2008) or, better yet, Shannon Brownlee’s Overtreated: Why Too Much Medicine Is Making Us Sicker and Poorer (2007). If you think your doctor is a hero, guess again.
In return for accepting the mild restrictions that would arise from evidence-based medicine, doctors should be relieved of the risk (real or perceived) of ruin from malpractice suits. Legal reform could create special malpractice courts where specially-trained judges can control damage awards and patients can be fairly compensated for medical injury. While the true impact of defensive medicine is hotly disputed, this is an issue that should be taken off the table. If insurance company profits and executive bonuses are a waste to the system, then so too are big paydays for trial lawyers.
Both of these measures recognize that there are limits to the wonders of modern medicine, and that doctors are not infallible. This is an attitude adjustment that must be made by doctors and patients alike if we are ever to bend the cost curve.
Seems more Judy Miller to me. She was paid, right? Right?
Minor typo:
Makes it funny though.
Post at DKos about this
http://www.dailykos.com/story/2010/1/8/10519/56727?new=true
Either way, madates which demand we pay the highest prices in the world with a promise they will continue to skyrocket to private corporations is just wrong.
focus! *s*
Thanks Nancy Pelosi! By taking impeachment off the table, you allowed this kind of corruption to become normalized. Heckuva job!
Patients and doctors alike are just practicing supply side economics. “Build it and they will come.”
Do you all think the assumpition and running everything as though the only human motivation is greed for wealth will ever backfire?
that’s not the point of my question… of course that is a given.
and don’t you effin’ love it – one of the biggest “this diarist gets paid by fdl !!!” watb’s is first up to ask why it’s a big deal he was paid
me too! didn’t know i had company though. i’ve been furious with gruber (and people who uncritically repeat his claims) for his bogus reports. this is such a complicated subject and flack from hacks doesn’t help.
I have no problem with GOOD science (as opposed to the Mammogram scam) to provide practice guidelines. However the aim of this health insurance legislation is simple. Lower costs to insurance companies by lowering services and utilization. Do you think it likely a corporate government is going to support good science in this area? –when it is as easy to bribe an ideologue?
??? i don’t understand. isn’t it an important issue of transparency to know who is paying who for their advocacy?
In my opinion Gruber’s analysis is flawed all the way through. I have to go to work, so don’t have time to post at length, but consider these qualitative points of contention:
Costs are always costs TO SOMEBODY; when politicians talk about “reducing costs” they are usually talking about SHIFTING costs, usually in a way that conceals what they are trying to do. For example, a military that relies on a draft seems to cost less than an all volunteer military, but it doesn’t: it simply shifts many of the costs of staffing the military away from government, and toward those who are compelled to leave their current occupations and enter military service.
Sen. John Kerry argued the other day on Huffingtonpost that the excise tax on high value health insurance plans will reduce Health Care costs, basing his analysis partly on the work of the aforementioned Professor Gruber. What Kerry neglects to mention is that a tax on something alway increases it’s price. So what Kerry means is that the revenue that’s expected to be generated by the tax will decrease the cost TO THE GOVERNMENT of passing and implementing this Bill. It will increase the costs to employess of obtaining Health Insurance, mainly in terms of an increase in the insurance premiums they will actually pay, and foregone benefits if their insurers decide to limit their offering to lower value insurance plans.
The Senate Bill does virtually nothing to reduce the overall costs of obtaining Health Insurance or implementing Health Insurance Reform, it simply shifts them from government to employers, and especially employees. Furthermore, as many have pointed out (and it was the failure of observers on other sites to even begin to get this point that encouraged me to seek out FDL), you can’t increase the demand for something, without doing anything to increase competition on the supply side, and expect it’s price to do anything but rise.
I can’t think of anything the government isn’t trying to do in this Bill that won’t contribute toward RAISING the rate of Health Insurance inflation except maybe the excise tax, which is a complete disaster on political grounds. The tax will undoubtedly make workers worse off, even if it results in higher wages, because the fact that employees are currently receiving a significant part of their real incomes in form of Health Insurance benefits means they value an additional dollar of income in the form of Health Insurance benefits more highly than they value that additional dollar of income if received in any other form, or spent on anything else.
That is partly the result of very high health care costs (not Health Insurance costs) in the U.S., but nobody anywhere is claiming that this Bill will do anything to reduce the costs of actually PROVIDING health care. It’s really about “reforming” Health Insurance, without addressing the fundamental problem: that rationing access to the Health Care system through private, for profit insurance companies doesn’t work very well, neither economically nor politically.
As I’ve said elsewhere, the economic logic of Gruber’s work in analyzing this Bill defies economic logic, as I understand it. On the other hand, when I posted my analysis on another matter having to do with Paul Krugman’s grudging support of the Senate Plan, a number of conributors to this forum noted that I am not employed by a very prestigious university compared to a number of other economists who are in favor of Obama’s or the Senate’s approach to Health Care Reform. So I admit, Gruber is employed by a much more prestigious University than I am. Moverover, nobody has ever offered me anywhere near $400k for my opinion on anything. So take it for whatever you think it’s worth.
William Doyle, Ph.D.
Associate Professor of Economics
University of Dallas
Delicious irony, no? Attack slinkerwink for paid blogging as advocacy, but give the government a pass for paying someone to create a set of “facts” to sell as objective analysis.
OK, don’t focus. /s
Happy New Year Firedog !
that’s all well in good. but even after Slink and Eve disclosed their advocacy status, that was one of the commenters channeling their inner 7 year old proclaiming any kind of paid advocacy is ev-il
yet went full metal heathers when Jane raised the possibility that another diarist was a paid PhRma advocate
Don’t be thin skinned. This is a blog, and people get to say what they want, absent violence. I’ve never found the institutional attachment of a person to be particularly important wrt their credibility. Too many games going on at the pretigious ones and too much good work elsewhere. So go with your own work, regardless of how people characterize it.
I agree with what you typed. Gruber’s work is just like all the data mining my Wall St. economist competitors were so talented at. And yes, the senate bill shifts costs, not reduces them.
Oh well. Consistency is overrated, right?
Emptywheel has a fresh cross-post already in progress: Gruber Doesn’t Reveal that 21% of MA Residents Can’t Afford Health Care
oh. thanks for the explanation (i either forgot or didn’t pay much attention to that bit of the history). i have no problem with people being paid — it’s the lack of disclosure, especially when it might be perceived as a conflict of interest.
p.s. happy new year to you too. hope it’s a good one!
As for that purported $80 billion from PhRMA, what does it entail? Various kinds of tax-deductible “cooperation” and advertising and a few lowered costs over at least ten years.
Congress could have saved more than $8 billion a year by reversing Bush’s tax cuts. “Revenue neutral” applies just as well when you raise money for what you spend. It may not be “cost control”, but it’s the item tied to its hip: increasing revenue to pay for what you do.
The US government finds it impossible to raise revenue to fight its wars or to pay for vastly increased domestic spying and federal subsidies for local law enforcement. Why should medical programs be different.
Lastly, we need to reframe the issue. The issue is improved access to health care. Improving access to health insurance is merely a tool. This Senate and White House have walked past an aisle of well-made less expensive ones and have chosen an exceptionally overpriced tool designed by Rube Goldberg.
thanks william. gruber is a hack willing to shill bogus reports and that’s what i suspect he is getting paid for. (i’ve only read two of his reports, and one was just and update, but that was more than enough for me).
I have an idea! You focus on what you want to focus on… without telling others what to focus on! /s
An HHS contractor is “a paid consultant for the Obama administration”? My county is an HHS contractor, is the county a “paid consultant for the Obama administration”?
when you are directly consulting with Obama and his health care team yes.
“So what Kerry means is that the revenue that’s expected to be generated by the tax will decrease the cost TO THE GOVERNMENT of passing and implementing this Bill.”
and this appears to be what they mean every time they say “reduce cost”. the only point of this bill, other than enriching wal st, is to cut governments share of health care cost by shifting most of the cost onto working people. this is just the start. we know where this is going.
“he’s been paid $297,600, according to federal documents, to produce “a technical memorandum on the estimated changes in health insurance coverage and associated costs and impacts to the government under alternative specifications of health system reform.” The contract, which was awarded June 19, wasn’t widely known or regularly disclosed.”
thats right from the beggining of the piece linked. seems prerty strightforward and easy to understand. they didnt say “xxxx county was hired to produce a memorandum”. they said gruber personally was. according to ‘federal documents”
Yes, I’m not stupid, I’m not having trouble understanding that he was hired as a government contractor to produce an assessment. I’m having trouble with how you jump from that to insinuations of corruption. That latter is your burden, not mine, unless you believe in guilt by innuendo. So don’t bother telling me that he has a contract. I understand that part.
Not disagreeing here but if you look at what Gruber is saying his idea, as is quoted above, is about reducing costs by “bending the curve”. This little bit of newspeak means that as employers are forced to reduce insurance spending, because of a progressively lower cap, the money represented by the difference between the previous amount and the new cap somehow flows back into the employees pockets. Just to be clear, if I wasn’t already, I cannot imagine what sorts of thinking go on in order for a person to believe this. The ivory tower thinking that he brags about being so much a part of his experience cannot possibly account for such a massive disconnect from the real world.
Gruber has said that he is a paid consultant for the Obama administration via HHS funding. If you don’t think that is true then the issue probably lies between you and Gruber or possibly the people who transcribed his conversations with Politico. HHS funding has nearly no relevance. What matters is who hired him, how much he was paid and what he was hired to do.
He self-identifies himself as a “paid consultant for the White House”…
Everything is FAKE FAKE FAKE LIES LIES LIES in this fucking country, because of corporations/media/1% wealthy/military industrial complex. Our government is a piece of shit! 99% of the country are good people and the 1% control and propagandize the 99%.