More Flailing Against Obamacare, and Related Backdoor Attacks on the IRS

April 14th, 2014 · No Comments · campaign finance reform, health care reform, tax policy

By Denise Tessier

When the health care enrollment deadline of March 31 passed with more than 7 million people signed up nationwide – “beating expectations” as the Associated Press put it – the Albuquerque Journal put the news inside , deciding the front-page story should be “NM lags on health care sign-ups.”

The latter, more negative of the two stories reported the state expected to fall short of its enrollment “goal” of up to 50,000, with about 18,700 signed up. That’s about half the 36,000 figure the board that oversees New Mexico’s health insurance exchange “realistically” would like to see, the New Mexico AP story added.

So, the Journal ran “positive” health care news inside (indexed on A1) and the “negative” news got the A1 slot, when the two just as easily (and justifiably) could have been reversed.

Two days later, the Journal ran what could be considered a “positive” New Mexico insurance story: “Health-exchange sign-ups tallied; NM insurance co-op among better-performing across U.S.” That story said New Mexico Health Connections “went from zero customers last September to about 10,000” as of the March 31 enrollment period closure.

Where did the Journal run this “positive” health insurance coverage story? It let the Business desk run it, inside, on B1.

NMHC is a separate entity from both Medicaid and the health “exchange.” According to the story, NMHC is “one of 23 consumer-run cooperative insurers created by the federal Affordable Care Act to increase competition with established insurance companies.” Some applications for coverage were still in the works for this insurance option, so the number of enrollees would eventually be even higher.

And the last paragraph of the “negative” New Mexico AP story that ran on A1 (the overflow of which ran inside), reminded readers that 103,000 New Mexicans had enrolled in Medicaid since October, a fact that was at the end of the story because it had already been reported in the Journal on March 20.

Now, to the non-health care industry reader, the variety of plans can be confounding. But from these three stories, one can assume at least 128,700 had signed up in New Mexico overall – the 18,700, plus 103,000 plus 10,000. The 103,000 Medicaid enrollment figure was close to the 130,000 projected for Medicaid.

That the enrollment process is still continuing was reflected on April 1 in the Journal’s running of the “It’s Not Too Late” (to get covered) story for those who missed the March 31 deadline. That issue of the paper also ran an AP summary – “Health care sign-ups surge but will they save Dems?” – that focused on the political significance of the national enrollment figure of 7 million, which, by the way, was up considerably from the 1 million enrolled at the end of December.

But by the end of the week, the Journal had run a “Fact Checker” piece from the Washington Post, which would leave a flawed impression for those who only read headlines. The story pointed out, among other things, that the phrase “signed up” didn’t necessarily reflect how many would actually pay the premium. This point was picked up for the headline: “Reviewing Obamacare numbers; Key test is how many people actually pay first month’s premium.” But the story itself said this is a non-issue in terms of enrollment numbers, and offered no evidence that masses of people would fail to pay:

At least 550,000 people have already purchased qualified health policies “off exchange” and the real number is almost certainly double that. (emphasis added) . . .

So the net result is at least 7 million, though it should be noted that CBO, in its estimates, assigned such policies to a different category than exchanges. It is not entirely clear in CBO’s tables but essentially the agency estimated that about 8 million people in 2014 would obtain insurance directly from insurance companies.

So, that story estimated 8 million, more than the 7 million touted by Obama at the beginning of the month, as the number of those who would be buying insurance directly from companies.

Then its headline’s flawed summation was buttressed by a naysayer column the Journal subsequently ran on its opinion page: “Obama’s celebration on health care premature; Sign-up numbers are suspect, and Americans remain deeply skeptical after Obama’s broken promises.” This column from the Fort Worth Star-Telegram, which ran April 9, continued the Journal’s predilection for running anti-Obamacare columns, as we’ve pointed out here previously.

The Journal chose to cast ACA in a negative light, too, when it covered the Congressional Budget Report that came out before the enrollment deadline, which pointed out that millions of Americans might leave their jobs or work fewer hours by taking advantage of the fact that they could, under Obamacare, now buy insurance coverage that previously was only available at work. In other words, the CBO was pointing out that some Americans had been staying in their jobs merely because of the health insurance benefit.

The Journal chose to cover the report by carrying an AP story by Andrew Taylor and Ricardo Alonso-Zaldivar (the latter of whom we’ve mentioned in previous posts for his choice of health care story slant). That story played up the CBO report as predicting “nationwide losses equal to 2.3 million full-time jobs by 2021.”

By the fourth paragraph, the story was highlighting the report as political fodder for Republican lawmakers:

It’s the latest indication that “the president’s health care law is destroying full-time jobs,” said Republican Rep. John Kline of Minnesota, chairman of the House Education and the Workforce Committee. “This fatally flawed health care scheme is wreaking havoc on working families nationwide,” he said.

This story could have just as easily been approached as a consumer benefit, rather than a “jobs loss” story. Instead, that angle is relegated to comments from the White House, and therefore, as a defensive position:

But the White House said the possible reduction would be due to voluntary steps by workers rather than businesses cutting jobs – people having the freedom to retire early or spend more time as stay-at-home parents because they no longer had to depend only on their employers for health insurance.

The law means people “will be empowered to make choices about their own lives and livelihoods,” said White House Press Secretary Jay Carney.

Buried in this kerfuffle about the “possible reduction” in jobs was this other angle in the story, although it was prefaced as the flip side of “bad news” for the president:

However, it wasn’t all bad news for the Obama administration. The CBO’s wide-ranging report predicted that the federal budget deficit will fall to $514 billion this year, down from last year’s $680 billion and the lowest by far since Obama took office five years ago.

The new estimates also say that the health care law will, in the short run, benefit the economy by boosting demand for goods and services because the lower-income people it helps will have more purchasing power. The report noted that the 2014 premiums that people pay for exchange coverage are coming in about 15 percent lower than projected, and the health care law, on balance, still is expected to reduce the federal deficit. (emphasis added)

So, those who have been trapped in jobs they didn’t want to be in had been given options via Obamacare, which in the short run would benefit the economy, with exchange overage premiums coming in lower than predicted and the law was “expected to reduce the federal deficit.” Good things, right?

Not in the eyes of the Journal, which echoed the AP story’s tone to produce the editorial, “Another unintended Obamacare consequence.” That editorial concluded that the Affordable Care Act was giving people a reason “not to work – and to stay poor and dependent on government support,” and then claimed that:

As they drop out of the workforce, it’s not a stretch to assume many of these individuals will also need and qualify for other taxpayer- and business-financed subsidies and supports, from the Supplemental Nutrition Assistance Program to unemployment benefits. That’s no way for a struggling economy to recover. Especially as the current workforce ages out and puts more pressure on entitlement programs.

That statement fails to even consider that some of those in the workforce might be leaving those jobs to go into business for themselves.

Another decidedly positive analysis of Obamacare figures, produced by the RAND Corporation, received mention in the Journal in passing, in the aforementioned Fact Checker story, which pointed out that “Because the RAND data are based on a survey, they have a margin of error that could significantly change the results.” For the record, the main points of the RAND report, from its summary, are:

9.3 million more people have health care coverage in March 2014, lowering the uninsured rate from 20.5 percent to 15.8 percent. This increase in coverage is driven not only by enrollment in health insurance marketplace plans, but also by gains in ESI and Medicaid.

Enrollment in ESI plans increased by 8.2 million and Medicaid enrollment increased by 5.9 million, although some individuals did lose coverage during this period.

. . . 3.9 million people are now covered through the state and federal marketplaces — the so called insurance exchanges — and less than 1 million people who previously had individual-market insurance became uninsured during the period in question.

And while the survey did not reveal whether this latter group lost their insurance due to cancellation or because they simply felt the cost was too high, it pointed out that this number “is very small, representing less than 1 percent of people between the ages of 18 and 64.”

A former Washington Post reporter Ezra Klein pointed out on his new blog, Vox:

Rand is very upfront about the fact that much of the data for their survey was collected in early March — before Obamacare’s massive, end-of-month surge.

Moreover, enrollment in Medicaid is still open, and Obamacare is also still signing people up into the exchanges through various deadlines and loopholes. So it’s certain that hundreds of thousands — and perhaps millions — more people have gotten insurance since the Rand survey ended. So think of this as a low-end estimate.

The Rand survey also found that 80 percent of Americans who had insurance before Obamacare experienced no change:

The ACA has not led to changes in the health insurance coverage of most people. Among adults, fully 80 percent still had the same form of coverage in March 2014 as in September 2013.

To its credit, the Journal also has run stories and columns about the Affordable Care Act that didn’t attack ACA, mainly courtesy of staff writer Winthrop Quigley, such as “ACA a catalyst for state-level innovation” (Business Outlook, March 24) and “ACA arguments about more than health,” (UpFront, page 1, April 8).

But there’s another, less obvious way that the Journal has been complicit in helping certain GOP legislators in their fight to repeal Obamacare. That is, it has been complicit in supporting the GOP’s attacks on the IRS.

On Wednesday, as reported in the Journal (April 10), the House Ways and Means Committee voted to refer former IRS division Director Lois Lerner to the Justice Department for possible criminal prosecution. (According to the story, Democratic leaders protested, saying the Justice Department is already investigating whether any crimes had been committed.)

Plus Lerner has already resigned. And she was not head of the division that allegedly unfairly targeted conservative groups when the alleged violations took place.

But investigations and her resignation were not enough for Darrell Issa, who – taking a page from Joseph McCarthy’s blacklist hearings of the 1950s – as of last week was also preparing to have Lerner charged with contempt, which could mean jail time.

The contempt charge would stem from Lerner taking the Fifth during questioning by Ways and Means. While Lerner did decline to answer questions, her lawyer, William Taylor, said he told Issa that Lerner would consider testifying at a subsequent hearing if delayed one week to accommodate Taylor’s travel schedule. Issa refused to let Lerner delay her testimony, leading the committee’s top Democrat, Elijah Cummings of Maryland to say that Issa appeared “more interested in having an unnecessary contempt fight than in actually obtaining the information and testimony he claims he wants.”

If you recall, Issa also silenced Cummings in hearings, literally cutting off the microphone while Cummings was testifying at one IRS hearing.

My colleague Arthur Alpert has written a thorough summary about all this and the Journal’s coverage of the IRS “scandal.” But some of the points are worth revisiting.

Non-profits are not supposed to be political, and so when the IRS found itself plugging through thousands of new non-profit applications, it scrutinized them. It was doing its job. If non-profits that aren’t supposed to be political have political language in their names, it’s only common sense that the IRS would be looking at these groups.

The Journal ran scads of national articles about the “investigations” into the IRS, and complemented them with local stories, such as last June’s front-page article about Tea Party breakfasts led by an 83-year-old woman – which became part of the IRS’ investigations after the Albuquerque Tea Party applied for non-profit status.

As Arthur pointed out, what the Journal didn’t ever mention, was that the only group that has lost its tax-exempt status in all this was a Democratic group, Emerge America, which worked to elect women to public office.

Meanwhile, as Joan Walsh pointed out in a Salon article:

Issa’s investigation has cost at least $14 million, and eaten up 97,542 hours of IRS staffers’ time. The agency has coughed up more than 500,000 pages of documents; 35 former and current IRS employees have sat for interviews. Treasury and IRS officials have testified at 15 separate congressional hearings.

All this tying of the IRS’ hands has had the effect of allowing the biggest of political “non-profits” to continue as non-profits. As Thomas Edsall pointed out in the New York Times:

In 2010, (Karl) Rove founded Crossroads GPS, as a “social welfare” organization, claiming tax-exempt status in accord with existing (if disputed) interpretations of campaign-finance and tax law. Since its founding, Crossroads GPS has spent a total of $253.6 million in support of Republican political candidates and organizations allied with the Republican Party, according to the Center for Responsive Politics.

It appears these huge organizations will get away with being tax-exempt while being overtly political because, a source told Edsall, “the I.R.S. must act on complaints within three years of the date an organization files what is known as an annual 990 report.” (emphasis added)

The Journal’s official position on all this was reflected in a June 2013 editorial, “Troubling IRS issues surface just in time.” It said “the IRS has been used to thwart the ambitions of conservative groups during two election cycles, stonewalling them with demands for such non-financial information as the composition of their prayers.”

Rather than thwarting, Issa’s committee has been helping conservative groups by keeping the IRS off their overtly political backs.

And, embracing the assumption that the congressional allegations of targeting conservative groups is true, the editorial takes the position that it is relieved “that some of the more troubling aspects of this omnipotent bureaucracy are coming to light before it adds thousands of employees and takes on the task of regulating the new federal tax known as the Affordable Care Act.” (emphasis added)

Because the IRS is crucial to the ACA, foes of the ACA have plenty of reason to “investigate” the agency and find a “scandal.” The Journal chooses to ignore the role that plays in the investigation dynamic because it, too, as an institution, opposes the ACA.

A footnote: After writing this post, this morning’s Journal carried a story headlined “Chances of being audited b IRS lowest in years.” Last year, the story said, the IRS audited fewer than 1 percent of all returns from individuals, then the lowest rate since 2005. This year, it said, “the numbers will go down.” For most Americans, this is probably good news, from a strictly personal standpoint. But it is also fallout from the politically motivated “scandal” investigations. Today’s story ran on the front page.

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