Back in the heady days of 2009-2010, I couldn’t eat a meal in a restaurant or watch a soccer match in a bar without overhearing wonky Washingtonian 20 or 30-somethings gushing about how proposed health care legislation — Obamacare — was going to “bend the cost curve.”
These insufferable leftists were adopting a myth espoused by candidate Barack Obama in 2008. As Avik Roy reminds us:
Back in 2008, three eminent Harvard economists who were advising the Obama campaign -— David Cutler, David Blumenthal, and Jeffrey Liebman — wrote a memo claiming that Senator Obama’s health-care plan could reduce national health spending by $200 billion a year. As Kevin Sack recounted in the New York Times, the authors of that memo then took that figure, “divided [it] by the country’s population, multiplied for a family of four, and rounded down slightly to a number that was easy to grasp: $2,500.”
Mr. Obama then took that number on the campaign trail, insisting that his health plan would “lower your premiums by up to $2,500 per family per year.”
You can watch Obama make this claim repeatedly in a video I have put up at the end of this post.
Unfortunately, it turns out that there’s no such thing as free lunch, or rather that free lunches, if anything, bend costs upwards. Last week, Roy notes, the Obama administration’s Centers for Medicare and Medicaid Services advised that “the [Affordable Care Act] is projected to . . . increase cumulative spending by roughly $621 billion” from 2014 to 2022.”
The $621 billion figure represents spending on top of the normal health-care inflation that would have happened if Obamacare had not been passed. This isn’t the cost curve bending we were promised.
Without vouching for the methodology developed by Obama’s crack team of Harvard economists for the 2008 campaign, Chris Conover at Forbes has used it to quantify the effect of Obamacare on health care premiums per family. In other words, Conover took the administration’s figure of $621 billion, divided it by the U.S. population, and multiplied by four.
Under this analysis, between 2014 and 2022, the increase in national health spending that is specifically attributable to Obamacare amounts to $7,450 per family of four.
Roy reports that the left, predictably, is howling over Conover’s use of such an analysis. A lefty analyst called Conover’s calculation one of the stupidest things he’s encountered in a long time.
One of the stupidest, anyway, since 2008.