ObamaCare Expanded Subsidies Live On

Like a dog with a good bone, Democrats won’t give up the expansion of ObamaCare subsidies. These subsidies were first created by the American Rescue Plan, the $1.9 trillion spending bill the Biden Administration pushed through Congress in the early days of their presidency. This bill has been cited as the single-most influential cause of our current double-digit inflation – the highest in over 41 years.

Yet the Biden Administration wants to double-down on this bad policy with more spending. Even though the Democrats couldn’t pass an even larger spending bill, the Build Back Better plan, despite controlling both houses of Congress, they haven’t given up. The latest is a scaled back plan The Wall Street Journal calls, “The Fattest ‘Skinny’ Spending Bill Ever.”

The heart of this bill is extending the ObamaCare expanded subsidies that were designed to be a temporary help for consumers who had lost their jobs due to the Covid pandemic. But even though the pandemic is largely over, and the jobless rate is a low 3.6%, the White House is pushing an extension of these subsidies, again. Even though there are more than two jobs available for every person looking for work, Democrats believe they must continue to provide these subsidies.

The truth is that the Democratic Party needs these subsidies to buy more votes in advance of the looming midterm elections when polls show Democrats can expect a Red Wave, crushing their control of Congress. It is the needs of the Party, not the needs of the American people, they are concerned about. Unfortunately, they may be able to pass the bill if Senator Joe Manchin caves in this time.

What’s wrong with continuing these expanded ObamaCare subsidies?

I’ve written before on this subject in two posts, Making ObamaCare Temporary Subsidies Permanent and ObamaCare Expanded Subsidies Must Expire. I refer you to the archives of my blog to read those important posts for more background information. But in a brief summary, I listed the following points from an article by Brian Blasé published in Forbes:

  • The expanded subsidies were intended to be temporary Covid relief, not a permanent expansion of government.
  • Extending the expanded subsidies would crowd out private financing and be inflationary.
  • Extending the expanded subsidies would lead to higher health care prices and higher premiums.
  • Extending the expanded subsidies would lead to large loss of employer coverage.
  • The budgetary cost will grow as employer drop coverage.
  • Extending the expanded subsidies would be a very inefficient way to spend taxpayer dollars.
  • Government healthcare commitments are already unsustainable, and extending the expanded subsidies just worsens the already grim U.S. fiscal picture.
  • Extending the expanded subsidies provides unfair benefit for wealthy households.
  • Only about 1,000 West Virginians with income above 400% of the poverty line are enrolled in the exchanges.
  • The loss of the expanded subsidies is much more limited than the media projects.
  • The expanded subsidies mostly benefit insurers, while consumers place a low value on the coverage.
  • Extending the expanded subsidies would reduce work and economic output.
  • Extending the expanded subsidies discriminates against women.
  • Extending the expanded subsidies papers over Obamacare’s problems and reduces Congress’s appetite for actual reform.


Who benefits most by these expanded subsidies?

According to the editors at WSJ, the biggest beneficiaries have been insurers that pocketed the subsidies and raised premiums. The Congressional Budget Office (CBO) this spring raised its estimate for ObamaCare exchange spending by $144 billion over the next decade from higher premiums and enrollment. They say it’s laughable for Democrats to claim that extending the subsidies for two more years will only cost a mere $40 billion. But that’s not all the bad news. More than 20 million Americans now enrolled in Medicaid will likely lose coverage as soon as the public-health emergency ends. The Committee for a Responsible Federal Budget estimates that extending all of this would cost about $45 billion next year and $495 billion over a decade.

Democrats would have us believe they can pay for all this by requiring Medicare to “negotiate” drug prices, by which they mean government will make drug makers an offer they can’t refuse. This is just another way of declaring price controls on drugs. The inevitable result of such meddling in the free market will be less investment in new drugs and higher prices when companies do launch a new drug.

This is all completely unnecessary. Prescription drug prices overall have actually fallen over the past four years due to competition from generics – a product of the Trump administration FDA. They promoted this competition by lowering the regulatory controls that were slowing the process of introducing more generic drugs in the market.

WSJ says there are more than 40 generic drugs on track to launch in coming years, and they are expected to yield more than $130 billion in savings for patients and government. This makes the $200 billion or so in Medicare savings that Democrats are claiming an accounting mirage. They are also claiming an additional $122 billion in savings from repealing a Trump Administration rule that banned drugmaker rebates to Medicare pharmaceutical benefit managers. But that rule has been delayed twice already by Congress to pay for last year’s infrastructure bill and recent gun-safety legislation. In truth, the rule was so complicated that it was unlikely ever to actually take effect.

WSJ says, “What a perverse precedent: Administrative agencies can create rules that increase government spending. Then Congress with a wink can delay or repeal them to finance more government spending. Democrats plan to use their fictitious Medicare savings to buy votes by paying for the ObamaCare subsidy extension and capping Medicare Part D out-of-pocket costs at $2000.”

It’s clear Democrats are desperate going into the midterm elections and desperate times call for desperate measures.

White House Stifling Scientific Debate – Part II

In Part I, we discussed how the White House is stifling scientific debate among public health doctors and scientists at the NIH, FDA, and CDC. This situation is causing low morale among the doctors and scientists that work at these public health institutions. Many are choosing to resign, even at the highest levels, but most continue on with a situation that is frustrating, exasperating, and alarming.

How is this environment impacting policy decisions?

That’s what really matters, beyond the career concerns of these public health officials. The American public must have faith in the medical policy decisions of their government officials. When these institutions make recommendations, the American people must believe these decisions are being made in their best interest, not the best interest of a particular political agenda.

Unfortunately, there are plenty of reasons to be skeptical about decisions being made by the Biden Administration. Dr. Marty Makary, Johns Hopkins Medical School professor continues his concerns in an article published by The New York Post.

Makary says nowhere has this problem of trust been greater – or the stakes higher – than on official public-health policy regarding children and Covid. He says, “First, they demanded that young children be masked in schools. On this score, the agencies were wrong. Compelling studies later found schools that masked children had no different rates of transmission. And for social and linguistic development, children need to see the faces of others.”

“Next came school closures. The agencies were wrong – and catastrophically so. Poor and minority children suffered learning loss with an 11-point drop in math scores alone and a 20% drop in math pass rates. There are dozens of statistics of this kind. Then they ignored natural immunity. Wrong again. The vast majority of children have already had Covid, but this has made no difference in the blanket mandates for childhood vaccines. And now, by mandating vaccines and boosters for young healthy people, with no strong supporting data, these agencies are only further eroding public trust.”

What is the truth about vaccines for children?

Three weeks ago, the CDC vigorously recommended mRNA Covid vaccines for 20 million children under five years of age. Dr. Rochelle Walensky, director of the CDC, declared that the mRNA Covid vaccines should be given to everyone six months or older because they are safe and effective. But is that really true? Here is the real data – you decide.

Pfizer used a three-dose vaccine in 992 children between the ages of six months and 5 years. They found no statistically significant evidence of vaccine efficacy. In the subgroup of children aged six months to two years, the trial found that the vaccine could result in 99% lower chance of infection – but that they also could have 370% increased chance of being infected.

Makary says, “In other words, Pfizer reported a rage of vaccine efficacy so wide that no conclusion could be inferred. No reputable medical journal would accept such sloppy and incomplete results with such a small sample size. More to the point, these results should have given pause to those who are in charge of public health.” He quoted one high-level CDC official who joked: “You can inject them with it or squirt it in their face, and you’ll get the same benefit.”

Moderna’s results were only slightly better. It conducted a study on 6,388 children with two doses. Against asymptomatic infections, it claimed a very weak vaccine efficacy of just 4% in children aged six months to two years. It also claimed an efficacy of 23% in children between two and six years old, but neither result was statistically significant. Against symptomatic infections, Moderna’s vaccine did show efficacy that was statistically significant, but the efficacy was low: 50% in children aged six months to two years, and 42% in children between two and six years old.

If you’re feeling skeptical after reviewing these results, so were many public health officials who feared their jobs if they were candid. One CDC physician said, “It seems criminal that we put out the recommendation to give mRNA Covid vaccines to babies without good data. We really don’t know what the risks are yet. So why push it so hard?” One FDA official had a similar reaction: “The public has no idea how bad this data really is. It would not pass muster for any other authorization.”

Fortunately, it seems the public is not as foolish as the White House believes. So far, only 2% of parents of children under age five have chosen to get the Covid vaccine, and 40% of parents in rural areas say their pediatricians did not recommend the Covid vaccine for their child.

Some scientists are pushing back against this politicization of science. The FDA’s two top vaccine regulators – Dr. Marion Gruber, director of the FDA’s vaccine office, and her deputy director, Dr. Philip Krause – quit the agency last year over political pressure to authorize vaccine boosters in young people. After their departure, they wrote scathing commentaries explaining why the data did not support a broad booster authorization. They argued in The Washington Post that “the push for boosters for everyone could actually prolong the pandemic,” citing concerns that boosting based on an outdated variant could be counterproductive.”

You have to admire those public health officials for standing up for their scientific opinions, even if they had to resign. It’s too bad others, like Dr. Walensky of the CDC, haven’t done the same.




White House Stifling Scientific Debate – Part I

The White House won’t tolerate scientists who disagree with their political agenda. This was made clear early in the Biden Administration. On 2/19/21, just four weeks after President Joe Biden took the oath of office, I wrote CDC Director Caves to Politics. The new CDC Director appointed by the Biden Administration, Dr. Rochelle Walensky, had just caved into the White House demands to alter her scientific opinion.

Here’s what I said at that time: “In an article published January 26th in the Journal of the American Medical Association (JAMA), three researchers from the CDC found “little evidence that schools have contributed meaningfully to increased community transmission” of the coronavirus. The CDC researchers looked at more than 90,000 students in 11 North Carolina districts and found that only 32 students and staff members were infected in school, while 773 got infected during the same period out of school. The science was clear; reopening schools was safe for children and teachers.

Then Dr. Walensky made her big mistake. On February 3rd, she announced these findings to the press. She made it clear that the science supported reopening schools.  In her statement she said, “Vaccination of teachers is not a prerequisite for safe reopening of schools.” This was a direct refutation of the demands being made by teachers unions before they would return to the classrooms. When asked about her statement, White House press secretary Jen Psaki responded Dr. Walensky was speaking “in her personal capacity” and not as the director of the CDC.”


In other words, the White House, not those public health officials with scientific credentials, would make the medical decisions that affected millions of children and their teachers.

This lesson was heard loud and clear by Dr. Walensky and by many other physicians and scientists who work for the Biden Administration. The latest evidence of this comes from Dr. Marty Makary, Johns Hopkins Medical School professor. In an article written for The New York Post, Makary says “doctors and scientists at the top levels of the National Institutes for Health (NIH), Food and Drug Administration (FDA), and the Centers for Disease Control and Prevention (CDC) are variously frustrated, exasperated and alarmed about the direction of the agencies to which they have devoted their careers.”

It’s like a horror movie I’m forced to watch and I can’t close my eyes,” one senior FDA official lamented. “People are getting bad advice and we can’t say anything.” That particular FDA doctor was referring to two recent developments inside the agency. First, how, with no solid clinical data, the agency authorized Covid vaccines for infants and toddlers, including those who already had Covid. And second, the fact that just months before the FDA bypassed its external experts to authorize booster shots for young children.

The same environment exists at the NIH Vaccine Research Center. Many of its senior scientists have left over the last year, including the director, deputy director, and chief medical officer. “They have no leadership right now. Suddenly there’s an enormous number of jobs opening up at the highest-level positions,” one NIH scientist told Makary.

The CDC has experienced a similar exodus. “There’s been a large amount of turnover. Morale is low,” one high level official at the CDC told Makary. “Things have become so political, so what are we there for?” Another CDC scientist told Makary, “I used to be proud to tell people I work at the CDC. Now I’m embarrassed.”

The truth is this situation could have been prevented. If Dr. Walensky had resigned rather than alter her opinion regarding the safety of reopening schools without the vaccination of teachers, a line would have been drawn in the sand telling the White House they cannot make scientific policy decisions. By caving into the pressure from the White House, Dr. Walensky made it clear her job was more important than her scientific opinion.


Next post: How this situation is affecting policy decisions regarding children.