Commentary

CBO Won't Hide Biden's Government Takeover of Health Care

By Phil Kerpen | June 9, 2020 | 2:57pm EDT
Democratic presidential candidate former Vice President Joe Biden speaks during a stop at an event in Des Moines, Iowa on February 3, 2020. (Photo credit: KEREM YUCEL/AFP via Getty Images)
Democratic presidential candidate former Vice President Joe Biden speaks during a stop at an event in Des Moines, Iowa on February 3, 2020. (Photo credit: KEREM YUCEL/AFP via Getty Images)

It became a major scandal when Philadelphia-based researcher Rich Weinstein uncovered video of Jonathan Gruber, the architect of Obamacare, saying: "This bill was written in a tortured way to make sure the CBO did not score the mandate as taxes. If CBO scored the mandate as taxes, the bill dies."

The quote became famous but was widely misunderstood; he was not referring to the penalty vs. tax question on which Chief Justice John Roberts would later uphold the law.  The issue was whether the payment for a mandatory government insurance program should be scored as tax revenue – like Social Security or Medicare premiums – or considered private sector payments.  This is crucial because a program scored as taxes and spending is transparently a government takeover, with potentially trillions of dollars shifted from the private sector to government.

There's bad news for Joe Biden's current plan. As Biden explained: "I'd bring back the individual mandate...and here's the deal.... We're in a situation where if you provide an option for anybody who in fact wants to buy into Medicare for All, they can buy in."

It's hard to see how a mandate paired with a government plan could be scored by CBO as anything but taxes and spending.

The relevant CBO document is a report from May 2009.

Biden's Medicare-for-All public option would unambiguously be scored as a government program, even if he tried to dress it up as a nonprofit.  But what about the mandatory purchase of putatively private insurance under the Biden scheme?  Could tortured language exclude that from the CBO score?  Probably not this time.

The central framework of Obamacare, an individual mandate to buy a tightly regulated but notionally private insurance product, was a close call for CBO. Gruber, Pelosi, and Obama got away with it based on the expectation that there would be many different companies in the exchanges (which in most of the country has not occurred) and on the lack of a public option.

Once Biden adds his public option, the whole program clearly becomes taxes and spending, exposing the massive expansion in the size of government expressly to the American people:

"In CBO’s view, a requirement that individuals purchase health insurance combined with tight federal constraints on the market for such insurance or a dominant role for a public plan would constitute a fundamentally governmental system, reflecting the exercise of the government’s sovereign power. In those situations, premiums appearing in the budget — for a public plan or for insurance purchased through exchanges or in the private market — should be recorded as federal revenues."

If CBO sticks to this standard, Biden will lose the principal advantage of the public plan strategy – its ability to camouflage from American voters that it leads directly to forcing everyone into a one-size-fits-all government plan by creating the illusion of allowing a choice of private plans.

The "public option" strategy for ending private insurance is to set it up in a rigged competition with a government-run plan that can absorb losses indefinitely and can use the power of government to dictate below-market prices to doctors and hospitals – as Biden's website puts it: "the Biden public option will reduce costs for patients by negotiating lower prices from hospitals and other health care providers."  Simultaneously, private plans would be subject to regulations by the same government that is competing with them.

Americans would have the illusion of being able to keep their private insurance for a while, but would all eventually end up in the single-payer government plan.

Some have said that makes the public option a Trojan Horse for single-payer, but Yale professor Jacob Hacker, the inventor of the plan, disputed that characterization to a 2008 audience at the liberal Tides Foundation: "Someone once said to me, 'This is a Trojan horse for single-payer.' I said, 'Well, it's not a Trojan horse, right? It's right there! I'm telling you!'"

Unfortunately for Biden, if the CBO follows its own guidelines on the issue, no amount of torturing legislative language will get him a score that conceals his intention to have government take control of American health care.

Phil Kerpen is head of American Commitment and a leading free-market policy analyst and advocate in Washington. Kerpen was the principal policy and legislative strategist at Americans for Prosperity for over five years.  He previously worked at the Free Enterprise Fund, the Club for Growth, and the Cato Institute.  Kerpen is also a nationally syndicated columnist, chairman of the Internet Freedom Coalition, and author of the 2011 book "Democracy Denied."

Editor's Note: This piece originally appeared on American Commitment.

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