As he raises his national visibility with speeches, television appearances and other public statements, speculation grows that Gov. Tim Pawlenty will run for president in 2012. This is one of an occasional series of articles that examine Pawlenty’s statements about his work in Minnesota and topics of national interest.
WASHINGTON, D.C. — Gov. Tim Pawlenty raised concerns this week in an opinion piece for The Washington Post about the Democrats’ health-care reform bill, advising Congress to look to states like Minnesota for workable models.
This is certainly good advice. Congress stands to learn a lot from what is already working in states and communities around the country. And Pawlenty’s article begins with a very true and problematic premise:
“If you tie money to results, you’ll get better results. Unfortunately, government often dumps money into programs without regard to accountability and outcomes,” the governor wrote.
But later in the article, Pawlenty cites a study that has previously been misrepresented by Republicans over the last couple of months to argue against one of the most-divisive issues in the health care debate: the public insurance plan option.
Here’s what Pawlenty said:
“…many Democrats in Washington want a government-run plan that would require states to comply with dozens of new mandates and regulations. One study by the Lewin Group recently concluded that an estimated 114 million Americans could be displaced from their current coverage under such a plan…”
Half true. There was indeed such a study, but the governor’s statement oversimplifies the study and is misleading.
In April, the Lewin Group, which is a health-care and human-services consulting firm, came out with a study that predicted how many people would eventually join a government-sponsored public insurance plan. The report looked at several scenarios that produce widely varying numbers of people migrating to the public plan. (It should be noted that while the Lewin Group maintains that its research and analysis is objective, it is a part of a subsidiary of the UnitedHealth Group, one of the nation’s largest insurers.)
On one end of the spectrum, the Lewin Group predicted that about 119 million people with private insurance (or employers with private insurance) would join the public plan if it were modeled after Medicare and open to everyone. On the other end, however, the Lewin Group found that if the plan were limited to fewer people and they had to pay higher premiums, then as few as 10.4 million people might switch.
Simply put, the Lewin Group made this common sense prediction: If the plan is available and has lower premiums than private insurance plans, more people will choose it.
In June, the Lewin Group amended their high number to 113.5 million to reflect changes in the House bill, which specified that the public plan would pay providers at Medicare rates plus an additional 5 percent. In July, the high number was amended again to 89 million after the bill was altered further.
When Pawlenty mentions the 114 million figure in his article, it comes from the Lewin Group’s June estimate. But Pawlenty does not acknowledge that this number applies to only one of the multiple public-plan scenarios that the group studied and that this particular scenario is not currently included in any of the three health care bills in Congress. (This includes the health care bills in the Senate Health and Finance committees and the most recent version of the House bill passed by the Energy and Commerce Committee.)
In fact, over the last few months, lawmakers in the House and Senate have been debating a number of different public-plan possibilities with many Democrats also saying that they will not support a Medicare-fashioned option.
The public plan that Democrats included in the health care bill that passed the Senate Health Committee earlier this summer is not connected to Medicare rates. Instead, under this plan the government would have to negotiate rates like private insurers. The rates, however, could be no higher than an average of the private insurer rates in a given area. Similarly, the version of the House bill, which passed out of the Energy and Commerce Committee last Friday, also included a public plan where the government would have to negotiate rates. The Democratic leadership changed the public plan in the House bill from one based on Medicare rates to one where rates would have to be negotiated specifically to get conservative Democrats on board.
Based on those changes, John Sheils, vice president of the Lewin Group and one of the authors of the study, predicted that only 10 million to 12 million people would end up switching from a previously held private plan to the public plan option.
“That is really small potatoes compared to what we were predicting,” Sheils said in an interview with MinnPost. “[With these changes] there really won’t be a cost advantage.”
And that gets at a second issue. The study’s cause-and-effect relationship is this: The cheaper the public plan, the more people would choose it over a comparable, but more expensive, private insurance plan.
But Pawlenty states it this way: “…Americans could be displaced from their current coverage under such a plan…”
By using the word “displaced,” which has an inherently negative connotation, Pawlenty implies that Americans would be forced from their current coverage.
In June, Sen. Orrin Hatch, R-Utah, and Republican strategist Karl Rove presented the study’s findings with a similar, although more blatant, spin.
According to NPR, Hatch said that a new public plan would cause millions of Americans “to lose” their private coverage. Rove, went a step further when he argued in an op-ed article in the Wall Street Journal that millions of Americans would “quickly lose what they now have and be forced into the government-run rolls.”
Republicans have argued that the more people that leave private insurance the more expensive those plans will become and so people will eventually be forced into the public plan, ultimately creating a single-payer system.
But that is not what the Lewin Group study looked at and it isn’t how it couched its predictions.
MinnPost contacted the governor’s office this week about the use of the 114 million figure and the use of the word “displaced.”
“Let me point you to a quote from Lewin Vice President John Sheils,” replied Pawlenty’s director of communications, Brian McClung, in an email. “He has said while ‘this is the extreme case, I don’t think it has been stricken from everyone’s agenda, as far as I can tell.'”
This is true. There are still lawmakers who have not given up on having a public insurance plan that is based on Medicare rates and open to all. But the point is that Pawlenty doesn’t say that the 114 million figure would only apply in this most extreme example. Instead, he makes it sound like any public insurance plan that requires states to comply with dozens of new mandates and regulations would result in 114 million people being displaced from their current coverage.
McClung did not address the governor’s use of the word “displaced” and did not respond to a second request for explanation.
Cynthia Dizikes covers Minnesota’s congressional delegation and reports on issues and developments in Washington, D.C. She can be reached at cdizikes[at]minnpost[dot]com.