U.S. Chamber Of Commerce Uses Old Health Care And Tax Lies To Attack Sen. Tester

November 16, 2011 12:50 pm ET

One new ad from the U.S. Chamber of Commerce attacks Sen. Jon Tester (D-MT) in particularly uncreative fashion. The ad accuses Tester of giving families reason to fear higher energy taxes, basing the claim on two votes from 2007 and 2008 on comprehensive climate change bills. The only vote from this year is Tester's opposition to billions in tax giveaways to oil companies that have made nearly a trillion dollars in profit in the past decade, but which still receive government tax breaks. The ad also trots out the old falsehoods about "Obamacare," including PolitiFact's 2010 "Lie of the Year." The Chamber appears more interested in defeating Senator Tester than in telling Montanans the truth.

U.S. Chamber Of Commerce: "Real Effects"

Washington's economic policies are making it harder. Is Jon Tester listening? For seniors, government-run health care. Billions in Medicare cuts to fund Obamacare. For small businesses, rising health insurance costs. For families, the fear of higher energy taxes. High unemployment. Call Senator Tester. Tell him to stop supporting big government and start fighting for Montana's families. Paid for by the U.S. Chamber of Commerce.

"Government-Run Health Care"?

PolitiFact Named The "Government Takeover" Talking Point Its "Lie Of The Year" For 2010. From PolitiFact:

In the spring of 2009, a Republican strategist settled on a brilliant and powerful attack line for President Barack Obama's ambitious plan to overhaul America's health insurance system. Frank Luntz, a consultant famous for his phraseology, urged GOP leaders to call it a "government takeover."

"Takeovers are like coups," Luntz wrote in a 28-page memo. "They both lead to dictators and a loss of freedom."

The line stuck. By the time the health care bill was headed toward passage in early 2010, Obama and congressional Democrats had sanded down their program, dropping the "public option" concept that was derided as too much government intrusion. The law passed in March, with new regulations, but no government-run plan.

But as Republicans smelled serious opportunity in the midterm elections, they didn't let facts get in the way of a great punchline. And few in the press challenged their frequent assertion that under Obama, the government was going to take over the health care industry.

PolitiFact editors and reporters have chosen "government takeover of health care" as the 2010 Lie of the Year. Uttered by dozens of politicians and pundits, it played an important role in shaping public opinion about the health care plan and was a significant factor in the Democrats' shellacking in the November elections. [PolitiFact.com, 12/16/10]

PolitiFact: "Obama's Plan Leaves In Place The Private Health Care System." Analyzing Sen. Tom Coburn's claim that President Obama's health care reform plan amounted to a government takeover of health care, PolitiFact.com wrote:

[H]e's wrong that Obama's plan offers government-run health care.

In fact, Obama's plan leaves in place the private health care system, but seeks to expand it to the uninsured. It increases eligibility for the poor and children to enroll in initiatives like Medicaid and the State Children's Health Insurance Program, and creates pools for individuals to buy their own cheaper insurance. It also outlines strategies to rein in costs for everyone, such as electronic medical records and preventive care.

[...]

That may be Sen. Coburn's opinion on what could happen, but it's definitely not part of Obama's plan. And Coburn was very specific in saying that "under the Obama plan, all the health care in this country is eventually going to be run by the government." That gives the incorrect impression that Obama is promoting a government-run health care system. He's not. We rate Coburn's statement False. [PolitiFact.com, 3/4/10, emphasis added]

Affordable Care Act's Medicare Savings Come From Eliminating Wasteful Overpayments...

New England Journal Of Medicine: The Affordable Care Act Phases Out "Substantial Overpayments" To Medicare Advantage Plans. From the New England Journal of Medicine: "A phased elimination of the substantial overpayments to Medicare Advantage plans, which now enroll nearly 25% of Medicare beneficiaries, will produce an estimated $132 billion in savings over 10 years. [...] The ACA also produces nearly $200 billion in savings by assuming that providers can improve their productivity as firms in other industries have done. On the basis of this presumed improvement, the law reduces Medicare's annual 'market basket' updates for most types of providers - a provision that has generated controversy." [New England Journal of Medicine7/8/10]

FactCheck.org: Cost Saving Provisions "Not A Slashing Of The Current Medicare Budget Or Benefits." According to FactCheck.org: "Whatever you want to call them, it's a $500 billion reduction in the growth of future spending over 10 years, not a slashing of the current Medicare budget or benefits. It's true that those who get their coverage through Medicare Advantage's private plans (about 22 percent of Medicare enrollees) would see fewer add-on benefits; the bill aims to reduce the heftier payments made by the government to Medicare Advantage plans, compared with regular fee-for-service Medicare. The Democrats' bill also boosts certain benefits: It makes preventive care free and closes the 'doughnut hole,' a current gap in prescription drug coverage for seniors." [FactCheck.org, 3/19/10]

Cuts Would Only Affect Medicare Advantage Plans. As reported by Kaiser Health News:

The new health law will cut $136 billion in spending on the Advantage program by 2019, which currently pays private plans to administer Medicare benefits and pays them about 14 percent more than the per-patient cost of the traditional Medicare program. Plans use that subsidy to lure members with lower premium costs or extra benefits not normally paid for by Medicare, such as vision care or better prescription drug coverage. Some Democrats and analysts have argued the higher rates are wasteful. 

Even experts who support the change concede that the impact of the cuts could be evident. Robert Berenson, a scholar at the Urban Institute and former Medicare official, said some Advantage plan members will notice skimpier benefits, "but the Republicans have really exaggerated that this will wipe out the Advantage plans." 

Marsha Gold, a health policy analyst for the private research group Mathematica, said, "Over time, there will be less rich benefits or higher premiums, but it's going to be gradual," noting that the largest cuts do not begin until 2015. [Kaiser Health News, 4/6/10]

...And The Law Extends The Life Of Medicare

PolitiFact: Latest Medicare Trustees Report Says Affordable Care Act Extended Life Of The Program By Eight Years, After Previous Report Put That Number At 12 Years. From a PolitiFact item fact checking Rep. Debbie Wasserman Schultz's (D-FL) claim that the Affordable Care Act extended the life of Medicare by 12 years:

The bigger problem with Wasserman Schultz's statement is that just a few weeks ago, the board of trustees issued a new report that revised its estimates for the health care law. Instead of adding 12 years of solvency, the board concluded, the law will only add eight years of solvency. Starting in 2024, the program will need either new revenues or reduced expenses to meet all of its obligations. The board said the shortfall was because of the continuing economic slowdown, which has reduced the Medicare program's income from taxes, and a few other lesser factors.

So Wasserman Schultz's number is off by about a third.

Nevertheless, her overall point, that the Democrats' health reform law added to the overall solvency of Medicare, is correct. The 2011 report included the same warnings that estimating health care savings for the future is an uncertain process, but it also concluded that the financial outlook for Medicare is "substantially improved as a result of the changes in the Affordable Care Act."

The law reduced spending and increased revenues in several ways. It slows increases in payments to hospitals and nursing homes. It raises Medicare hospital taxes for high earners. And it introduces several new programs aimed at steering the health system away from paying doctors and hospitals per procedure ("fee for service") and instead paying for good outcomes. [PolitiFact, 5/27/11, emphasis added]

Premiums Were Rising Sharply Before The Law Passed, And The Affordable Care Act Will Slow The Growth Of Health Care Spending Over Time

FactCheck.org: "Premiums Have Been Rising Well Before The  Law, And Were Expected To Rise Without It." According to the nonpartisan FactCheck.org: "As we've written before, rising medical costs are the primary driver of increasing premiums, and that's according to insurance companies and state insurance commissions. In fact, the CBO has said the law won't have much of an impact on premium costs for most Americans, compared with what premiums would have been without the law. (Premiums have been rising well before the law, and were expected to rise without it.) Those on the individual market - persons who buy their own insurance - will see an average increase of 10 percent to 13 percent, but more than half of those individuals will get subsidies that reduce their out-of-pocket costs substantially. And the increase in premiums will be due to an increase in benefits in those plans." [FactCheck.org, 1/27/11]

Affordable Care Act Insures 34 Million New People With 1 Percent Health Care Spending Increase. According to the Washington Post's Ezra Klein:

First, be clear about what's being estimated. The Congressional Budget Office's estimates look at the deficit. CMS is looking at total national health expenditures. This often confuses people into thinking that there's conflict between the two sets of numbers when there isn't: CBO says that federal spending is going to go up to pay for the coverage expansion, but that savings and revenue will go up by even more, leading to a net reduction in the federal deficit. CMS is looking only at the spending side. And here's what it finds: In 2019, implementation of the Affordable Care Act will reduce the ranks of the uninsured by 34 million people and increase nation health expenditures by 1 percent. One percent... So that's the bottom line of the report: We're covering 34 million people and come 2019, spending is expected to be one percentage point -- and falling - above what it would've been if we'd done nothing. [Washington Post, 4/23/10, emphasis added]

After One-Time Spending Increase In 2014, Costs Grow More Slowly Than They Would Without Reform. According to the Washington Post's Ezra Klein:

[W]e're covering about 10 percent of the country and increasing spending growth by 0.2 percent. Seems like a good deal to me. But it's actually a better deal than that. Here's what the cost curve -- or maybe I should say cost line -- looks like:

What you're seeing here isn't the cost curve bending up. It's a one-time increase in the level of spending. That's the big jump in 2014, the year the exchanges and subsidies come online. So when you compare 2014 to 2013, spending growth seems like it's gone up a bunch. But by 2016, we're back to normal. In fact, we're better than normal [according to a September CMS report]: "For 2015-19, national health spending is now projected to increase 6.7 percent per year, on average -- slightly less than the 6.8 percent average annual growth rate projected in February 2010."

In other words, 2014 is a one-time increase in spending level as we get 30 million new people covered. After 2014, costs grow more slowly than they would without the health-care reform bill. [Washington Post9/10/10, emphasis added]

"Higher Energy Taxes"? Sen. Tester Opposed GOP Attempt To Prevent EPA From Doing Anything About Climate Change

On-screen text in the ad when the narrator claims Tester has supported higher energy taxes for families cites three votes: Senate Vote #145 from 2008, Senate Vote #54 from 2011, and Senate Vote #217 from 2007.

Tester Voted Against The GOP's Attempt To Block The EPA From Using Regulatory Authority To Deal With Climate Change. Roll call vote #54 on April 6, 2011, was on an amendment "To prohibit the Administrator of the Environmental Protection Agency from promulgating any regulation concerning, taking action relating to, or taking into consideration the emission of a greenhouse gas to address climate change." Sen. Tester voted no. [S.Amdt. 183, Vote #54, 4/6/11]

Sen. Tester Supported Closing Tax Loopholes For Giant Oil Companies That Made Almost A Trillion Dollars Since 2001

In May, The Senate Blocked A Bill To Close $2 Billion In Annual Tax Loopholes For The Largest Oil Companies. As reported by the Los Angeles Times: "Senate Republicans on Tuesday blocked a Democratic effort to scale back oil industry tax breaks, underscoring the difficulty of getting Congress to agree to any significant measures aimed at bringing down gas prices. All but two Republicans - along with three Democrats - voted against bringing the repeal measure up for debate, even though the $2 billion a year in additional tax revenue from five major oil companies would have been steered into reducing the federal budget deficit, a Republican priority." [Los Angeles Times, 5/17/11]

  • Sen. Tester Voted In Favor Of Closing The Oil Tax Loopholes. [S. 940, Vote #72, 5/17/11]

Companies Targeted By Legislation Have Recorded Profits Of $90 Billion Per Year On Average For The Past Decade. From the Center for American Progress: "Each time Americans' gas bills go up, so do Big Oil's profits. In the first quarter of 2011 alone, Persian Gulf unrest combined with speculators bidding up prices led to oil prices rising by more than one-third. Higher oil prices on the world market led to higher gasoline prices across our nation, and the big five oil companies made $32 billion in profits. Profits of this size are quite common. Between 2001 and 2011, a period marked by gas price volatility, these five companies collectively made more than $900 billion in profits. In 2010, Exxon Mobil finished first in the Fortune 500 list of company profits for the eighth year in a row, with Chevron coming in third and ConocoPhilips 16th." [Center for American Progress, 5/17/11]

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