POLICY: NCPA–the Manchurian think-tank?

Most people think that John Goodman’s shop NCPA is made up of libertarians and conservatives—and their leaders and their donors apparently hope so. That’s what one of their number told me at the Vegas conference this week, where true to form they were all desperately pushing HSAs.

And they seem to mean it. After all they fired one of their number (Bruce Bartlett) because he criticized W for not being a real conservative and apparently because a donor was going to pull $100K in funding if he wasn’t canned!. By the way, a gig at NCPA isn’t a bad one to have. Apparently Bartlett was getting $172K a year, and between Goodman and his wife who also works there are on well north of $600K!

So I was a little bemused when my editor at Spot-on, Chris Nolan, got a blast email from them last week. See, Chris is a professional and she changed whatever wonky title I cam up with. now the article was called Risky Business: Bush’s Health Plan and it became the second highest rated story in Google News when you searched on “Bush’s health plan”. She’s smart that Nolan woman!  There were over 6,000 pageviews of that article alone. Apparently enough to stun NCPA into action. Chris got this email:

From: "Kelley Tway"Date: January 25, 2007 12:46:34 PM PST
To: cnolan@spot-on.com

Subject: Response to critics of Bush health plan

Almost immediately after President Bush announced his health care initiative critics in the media and on Capital Hill objected to the standard tax deduction, arguing it will lead to an erosion of employer-based health care as employees, particularly healthy employees, will be lured out of their employer-based coverage to seek coverage in the individual market.

The belief that employees would choose an individual, private health plan over their employer-provided coverage indicates a misunderstanding of how employer plans work. All employers pay at least one-half of the health plan premiums – most pay about two-thirds. So a group plan would have to be incredibly wasteful (i.e. expensive) for an individual plan to look more attractive than their employer’s coverage. With a level tax playing field, the employer still pays at the very least half of the premium, while an employee would pay 100% of the premium for an individual plan. So, which is the more attractive option?

The standard tax deduction simply makes insurance more affordable for those who don’t receive insurance through an employer.

Please let us know if you have any question about this or would like a response to any other criticism of the Bush health plan.

Kelley Tway
Media Relations Coordinator,Health Care
National Center for Policy Analysis

Sean Tuffnell
Director of Communications

National Center for Policy Analysis972-308-6481

I must admit I thought that was pretty funny. So I dashed off this quick reply to communications honcho Kelley Tway:

KelleyDon’t be scared–you can email me directly. I don’t bite, well not that hard.
    As to your "employers will pay for health insurance" line. It’s just not true given that virtually all employer based plans are relatively generous & expensive–especially compared to the individual market.

Where in the proposal does it say that employers have to pay for health insurance for employees? Nowhere of course. That would be "pay or play"–something only lefty Democrats like Arnie and Mitt Romney think is a good idea. If you make it attractive for employees to forgo their presumed current $7500 worth of employer-provided plan, ask for a small cash raise, take the deduction, and to leave the employer plan–then why won’t they do it? That’s what $7,500 deduction means when a 25 year old can buy a HDHP in California for well under $1,500 a year. Have you guys stopped believing in market forces?

If not it’s disingenuous to think that this proposal won’t make younger and healthier people leave employer based insurance.
  And if enough of them do it, of course that will eventually put the employer insurance plans in the same spot that the rest of the cream-skimmer underwriters whom you guys so ardently support (and who fund you) have put the individual insurance market–screwed.
    But like you I believe that we shouldn’t have an employer-based insurance market. But don’t worry, with reforms like this, the complete pissing-off of the middle class is closer and so is the consequent Medicare for all/single payer plan. Obviously you guys are keen to see that–as it’s the logical outcomes of your policies!
  — Matthew Holt

I haven’t heard back yet, of course.  Despite the fact that they were inviting “questions”.

But was I wrong? Perhaps I hadn’t delved into the mire of the proposal enough? If so I’m clearly not the only one. Because that very next day the organ of the Republican right the WSJ ran a piece called Bush Health Plan Shifts Onus to the Consumer which included this little nugget:

At a White House briefing on Tuesday, Joel Kaplan, deputy chief of staff for policy, acknowledged that the proposal could accelerate the trend of employers dropping insurance, but emphasized that workers left without coverage would, thanks to the new tax deduction, have the means to "buy insurance in the individual market in a way that they can’t now."

Really, who is NCPA trying to kid when it suggests that it’s not interested in promoting people buying individual insurance in a fully underwritten market. And given the state of the individual market that they want to introduce consumers into (more of that anon via some interested digging Don McCanne’s been doing), they’re just going to create more and more pissed off consumers—of the age and socio-economic status where an extension of Medicare will be a very appealing vote-getter.
So you’ve got to assume, that must be what they actually want? In which case I can see the movie now. Starring Frank Sinatra or maybe Denzel Washington as John Goodman, it’s The Manchurian Think-Tank!

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