Thread by @chrisjacobsHC

THREAD: Have spent the past several days analyzing @ewarren plan in detail, to find the budget gimmicks (of which there are several).

RT/follow the below, as I go through her plan -- both the "savings" and how she wants to pay for #SinglePayer...

@ewarren Savings Proposal #1: @ewarren says she can save $1.8 trillion over ten years (relative to @urbaninstitute estimates) by having administrative costs of 2.3%, rather than the 6% assumed by Urban... 2/

@ewarren @urbaninstitute By the way, the @urbaninstitute study from last month is available here: 3/ urban.org/sites/default/…

@ewarren @urbaninstitute And the @ewarren paper highlighting her health "savings" is available here: 4/ assets.ctfassets.net/4ubxbgy9463z/2…

@ewarren @urbaninstitute Back to the administrative "savings:" One big problem is that the #SinglePayer bill @ewarren and @BernieSanders support is NOT just an expansion of #Medicare. As I've previously written, it would abolish the current #Medicare program... 5/ wsj.com/articles/sande…

@ewarren @urbaninstitute @BernieSanders As a result, @ewarren and @BernieSanders would replace the (tens of) thousands of pages of #Medicare regulations with only 100 pages of legislation. It would require significant amounts of regulatory efforts, all of which would cost money. 6/ congress.gov/116/bills/s112…

@ewarren @urbaninstitute @BernieSanders .@urbaninstitute recognized the problem in creating this new system; one of its analysts said that a 2.3% rate for administrative expenses would make it difficult for the government to set accurate prices for services. 7/ reuters.com/article/us-usa…

@ewarren @urbaninstitute @BernieSanders Second, while @ewarren claims that #Medicare has a 2.3% rate of administrative costs, that isn't accurate. The Medicare trustees don't count things like construction costs for @CMSGov buildings, or collection costs that @IRSnews imposes on employers to collect payroll taxes. 8/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews Multiple reports have analyzed the inadequacy of #Medicare's administrative cost claims over the years; here's one, for instance... 9/ cahi.org/cahi_contents/…

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews Even @ezraklein admitted in 2009 that a more realistic estimate for #Medicare administrative costs "would be in the range of 5-6 percent," exactly what @urbaninstitute assumed in their study. 10/ voices.washingtonpost.com/ezra-klein/200…

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein .@ezraklein also rebuts @ewarren on low administrative overhead: "Some activities that are considered ‘administrative’ are useful. Disease management, for instance….Good-faith investigations into waste, fraud, and abuse. Nurses who...remind patients to take their drugs."

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein .@ezraklein's larger point that "Administration is not always wasteful" contradicts @ewarren. It also suggests that @ewarren could be penny wise, pound foolish in cutting administrative spending to unrealistically low levels. 12/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein For instance, @USGAO found that (traditional FFS) #Medicare has an improper payment rate of 8.12%, while #Medicaid has an improper payment rate of 9.8%. 13/ gao.gov/assets/700/697…

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO Keeping administrative costs very low, as @ewarren proposes, would only encourage fraud and corruption, as I noted in my @RealClearNews piece back in June... 14/ realclearpolitics.com/articles/2019/…

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews Moreover, it's ridiculous for @ewarren to claim on the one hand that MORE money for @IRSnews enforcement will crack down on tax evasion/fraud, but that LESS spending on administrative costs won't lead to more #Medicare fraud and abuse. She can't have it both ways... 15/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews SAVINGS PROPOSAL #2 of @ewarren plan: She proposes to save $1.7 trillion over ten years (compared to @urbaninstitute estimates) by assuming a 70% reduction in current #Medicare prices for brand drugs, and 30% reduction for generic drugs. 16/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews To achieve those savings, @ewarren goes beyond @SpeakerPelosi bill (H.R. 3). She uses a lower savings target for "negotiating" prices, adds penalties for companies with above-inflation price hikes, and allows @HHSGov to license patents of companies that won't "negotiate." 17/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov First problem with @ewarren's proposal: She and @SpeakerPelosi both think it's legal -- and it may not be. This seems an arbitrary, and possibly unconstitutional, exercise of government power. 18/ dailywire.com/news/jacobs-th…

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov .@USCBO, with characteristic understatement, said that H.R. 3 "could result in litigation." Yes, imposing a 95% excise tax -- such that a company will lose money -- if it doesn't "negotiate" seems SLIGHTLY coercive... 19/ cbo.gov/system/files/2…

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO Moreover, @USCBO also said that H.R. 3 will result in the development of fewer drugs, by discouraging innovation. @ewarren would put @SpeakerPelosi plan on steroids -- a bad idea, as @USCBO likely underestimated the innovation penalty in H.R. 3 20/ americanactionforum.org/weekly-checkup…

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO SAVINGS PROPOSAL #3: @ewarren claims she can save $600 billion over ten years compared to @urbaninstitute estimates, by paying hospitals 110% of current #Medicare rates, instead of the 115% in the Urban plan. 21/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @ewarren would also pay doctors 100% of current #Medicare rates, as in the @urbaninstitute plan. She has four prime reasons behind this policy... 22/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO First, @ewarren claims doctors/hospitals will save on administrative costs, by dealing only with one government agency. But as I noted above, @BernieSanders bill (which Warren supports) creates an ENTIRELY NEW PROGRAM. That wouldn't save anyone money for quite some time. 23/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO Second, @ewarren claims that #SinglePayer would let doctors "gain back much of [their] time for additional patient care, increasing their billable hours." "For hospitals, this increased access [to services] means increased volume and enhanced revenues." 24/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO Here, @ewarren's position is inherently illogical: That doctors and hospitals will get paid less to do more work. Or, as per an old I Love Lucy episode, they will lose money on each patient -- but make it up in volume. 25/ thefederalist.com/2018/08/02/ber…

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO Third, @ewarren claims that antitrust scrutiny will lead to greater efficiency: "hospital competition will be an important feature…to ensure that providers are competing for patients on the basis of care quality and experience." 26/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO However, Section 614 of the @RepJayapal House bill (but not @BernieSanders' Senate bill) PROHIBITS @HHSGov from paying doctors or hospitals based on quality metrisc. If everyone gets paid the same, regardless of the quality of the care they provide, why would anyone compete? 27/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal Finally, @ewarren says that doctors and hospitals would be better off in "aggregate" terms, and says those who would lose money under #SinglePayer are "inefficient." 28/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal Her claims may be true, but @JAMANetworkOpen study in April concluded that hospitals could lay off up to 1.5 million people for a #SinglePayer system paying at #Medicare rates. 29/ jamanetwork.com/journals/jama/…

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen Granted, @ewarren said she would pay hospitals 110% of current #Medicare rates, and not the 100% modeled in the @JAMANetworkOpen study. Regardless, it's likely hospitals would have to cut pay and/or jobs to achieve the "efficiency" Warren wants. 30/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen SAVINGS PROPOSAL #4: @ewarren claims she could save a total of $2.3 trillion over ten years (compared to @urbaninstitute study) by implementing site-neutral payments (savings of $500 billion), reforming post-acute care ($500B), and hospital bundled payments ($1.2 trillion) 30/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen First problem: The biggest source of savings - $1.2 trillion from hospital bundled payments - is from a @USCBO score that's six years old (Nov. 2013). A LOT has happened since then. 31/ cbo.gov/budget-options…

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen If @ewarren campaign relied on old scores, doctors/hospitals are already doing what she says she will force them to do, and/or @urbaninstitute modeling already incorporated these changes, then the savings are false/illusory... 32/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen Second problem: @ewarren said “we further adjusted the bundled payment extrapolation to reflect the desired policy outcome of reducing this spending...an additional reduction [in hospital payment rates] to achieve this spending aim.” No specifics on what they "adjusted" and why.

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen Third problem: @ewarren is already proposing doctors and hospitals get paid less (to do more work, remember). Proposing ANOTHER 5-10% pay cut on top of that reduction seems unrealistically stingy. And if she isn't doing cut-upon-cut, then she overestimated her savings. 34/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen SAVINGS PROPOSAL #5: @ewarren says she will reduce spending by an additional $1.1 trillion compared to @urbaninstitute estimates, by holding the growth of spending in future years equal to GDP growth. 35/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen But @ewarren doesn't have many specifics to ensure health costs will rise no faster than GDP. The plan just assumes that it "will certainly work to lower cost growth." The only specified policies: "global budgets, population-based budgets, and automatic rate reductions." 36/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen But @USCBO said in May that constrained global budgets in @NHSuk "created severe financial strains on the health care system. Provider payment rates have been reduced, many providers have incurred financial deficits, and wait times for receiving care have increased." 37/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen @NHSuk Not two years ago, here's what global budgets and meeting arbitrary spending targets meant to @NHSuk: 55,000 operations cancelled, 12 hour ER waits, and ER doctors complaining of "Third World conditions" due to overcrowding... 38/ dailymail.co.uk/news/article-5…

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen @NHSuk It's therefore ironic that @donberwick - he of "rationing with our eyes open fame," who worked in @NHSuk - wrote @ewarren plan. Guess he wants to bring UK-style rationing to the American health care system... 39/ ncbi.nlm.nih.gov/pmc/articles/P…

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen @NHSuk @donberwick Finally, SAVINGS PROPOSAL #6: @ewarren says she can "save" $6.1 trillion (relative to @urbaninstitute estimates) by having state/local governments pay the feds for taking on their Medicaid costs ($3.4 trillion) and personnel/retiree costs for their employees ($2.7 trillion). 40/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen @NHSuk @donberwick First problem: This is NOT a savings proposal -- it's a FUNDING proposal. It doesn't reduce health care costs at all -- it just shifts costs from the feds back to the states. @ewarren just called it a "savings" proposal to reduce the "cost" of her plan by $6.1 trillion. 41/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen @NHSuk @donberwick Second problem: It could well be unconstitutional. SCOTUS has of late cracked down on the feds telling states what to do. @GovChristie lawsuit ending the federal ban on sports gambling was but the latest example of this anti-commandeering jurisprudence. 42/

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen @NHSuk @donberwick @GovChristie In 2012, John Roberts struck down #Obamacare's mandatory #Medicaid expansion, which cost $1.5 trillion or so, as unconstitutional, saying it was "economic dragooning" of states. supremecourt.gov/opinions/11pdf…

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen @NHSuk @donberwick @GovChristie In 2010, @USCBO said #Medicaid expansion would cost states about $434 billion over ten years.

SCOTUS said imposing those costs was unconstitutional. So of course @ewarren wants to impose an unfunded mandate 15 TIMES LARGER. Good luck with that. 44/ cbo.gov/sites/default/…

@ewarren @urbaninstitute @BernieSanders @CMSGov @IRSnews @ezraklein @USGAO @RealClearNews @SpeakerPelosi @HHSGov @USCBO @RepJayapal @JAMANetworkOpen @NHSuk @donberwick @GovChristie Therein lie the good, bad, and ugly (mainly the last two) of @ewarren's "savings" proposals. May do another thread talking about her revenue-raisers later. But for now, I'm taking a break from the policy tweet-threading... 45/

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