Jonathan Gruber, the health care economist and former Obama administration adviser on the Affordable Care Act, backtracked from his controversial statements about the law in a hearing on Capitol Hill Tuesday, looking to limit the fallout from comments that have created both legal and political challenges for the future of one of President Barack Obama’s signature achievements.
In a series of comments made in 2012 but recently unearthed, Gruber had said the health care law only passed because Democrats had avoided explaining publicly exactly how the law worked and instead played on the “stupidity of the American voter.” He had also suggested that people who live in states that do not create their own exchanges under the law would not be eligible for tax credits.
“I do not think the Affordable Care Act was passed in a non-transparent fashion,” Gruber said at a hearing of the House Oversight and Government Reform Committee, calling his previous remarks on stupidity “glib” and “thoughtless.”
He added, on the question of exchanges, “The portion of these remarks that has received so much attention lately omits a critical component of the context in which I was speaking. The point I believe I was making was about the possibility that the federal government, for whatever reason, might not create a federal exchange.”
“If that were to occur and only in that context, then the only way that states could guarantee that their citizens would receive tax credits would be to set up their own exchange. I have a long-standing and well-documented belief that health reform legislation in general and the ACA in particular must include mechanisms for residents in all states to obtain tax credits,” Gruber argued.
The long-awaited hearing was the first chance for Rep. Darrell Issa, the California Republican who runs the committee, and other conservatives to highlight two new controversies around the ACA. Issa not only highlighted Gruber’s remarks, but also inaccurate counting of those enrolled in health care by the administration.
Earlier this year, Obama aides had said 7.3 million people had signed up and remained in health care plans through the law, but did not indicate that about 400,000 of these people were enrolled simply in dental plans, not full health insurance. This gap was politically important, because it meant the administration had fallen just short of its goal of enrolling 7 million people in plans through the ACA.
Secretary of Health and Human Services Sylvia Burwell has apologized for the error, but Issa accused the administration of an attempt to “inflate” the numbers at the hearing.
The debate over Gruber’s words will extend beyond today’s hearing. The Supreme Court will hear a case called King v. Burwell this spring in which conservative lawyers argue the subsidies people get under the law should not apply to states that have not set up their own exchanges, citing text of the law, which says tax credits should go to Americans, “through an Exchange established by the state.” The Obama administration and Democrats who wrote the law, as Gruber argued, have said it was always their intention to offer tax credits to people who did not leave in states that set up their exchanges.
Only 14 states have so far set up exchanges, meaning that millions of people would not be eligible to get the subsidies under the law if the court rules against the Obama administration’s position. If the Court ruled against the administration’s view, it is likely states with Republican-led governors and legislatures would opt against setting up exchanges, as they have declined to expand Medicaid under the law, while more blue states would embrace the exchanges.
The remarks that Gruber made in a speech in January 2012 are now at the center of the conservatives’ case at the Supreme Court, which is expected to make a ruling next spring. “What’s important to remember politically about this, is if you’re a state and you don’t set up an Exchange, that means your citizens don’t get their tax credits,” Gruber said back then, suggesting most states would eventually feel compelled to set up exchanges.
Conservatives seized on these comments because Gruber was a key figure in crafting the health care law. He was an architect of the Massachusetts health care reform signed into law by then-Gov. Mitt Romney that included a mandate everyone purchase insurance. The Obama administration borrowed heavily from the Massachusetts law in writing the Affordable Care Act, and Gruber worked as a paid consultant for the administration in 2009 and 2010, using an economic model he has created to predict how much various provisions in the law would cost and how many of the uninsured they would cover.
But he has tried to downplay his role, as his comments could lead to a court decision that unravels the ACA, which Gruber strongly supports.
“I was not the architect of President Obama’s health care plan,” Gruber told the committee on Tuesday.
At the hearing, Republicans argued that was not the case. Rep. Jim Jordan, a Republican from Ohio, read clips from a number of newspapers citing Gruber’s influence.
Obamacare Architect: Lack of Transparency Was Key Because ‘Stupidity Of The American Voter’ Would Have Killed Obamacare
Photo of Patrick Howley
10:30 PM 11/09/2014
Economist Jonathan Gruber speaks at a conference of the Workers Compensation Research Institute in Boston, Massachusetts, March 12, 2014. Dr. Gruber is a professor at MIT and the architect of the health-care reform laws in Massachusetts and the American Affordable Care Act. (REUTERS/Dominick Reuter)
Obamacare architect Jonathan Gruber said that lack of transparency was a major part of getting Obamacare passed because “the stupidity of the American voter” would have killed the law if more people knew what was in it.
Gruber, the MIT professor who served as a technical consultant to the Obama administration during Obamacare’s design, also made clear during a panel quietly captured on video that the individual mandate, which was only upheld by the Supreme Court because it was a tax, was not actually a tax.
“This bill was written in a tortured way to make sure CBO did not score the mandate as taxes. If CBO scored the mandate as taxes, the bill dies. Okay, so it’s written to do that. In terms of risk rated subsidies, if you had a law which said that healthy people are going to pay in — you made explicit healthy people pay in and sick people get money, it would not have passed… Lack of transparency is a huge political advantage. And basically, call it the stupidity of the American voter or whatever, but basically that was really really critical for the thing to pass… Look, I wish Mark was right that we could make it all transparent, but I’d rather have this law than not.”
Tags: 'Exchange established by the State, Affordable Care Act, Darrell Issa, Democrats, Former Obamacare Adviser, Gruber, Issa, Jim Jordan, Jonathan Gruber, King v. Burwell, Massachusetts, Mitt Romney, Obama, obamacare, ouse Oversight and Government Reform Committee, President Obama's health care plan, Secretary of Health and Human Services Sylvia Burwell, Stupidity of the American Voter, tax credits