Mitchell & Mitchell on Health Care and the Trump Agenda, Part 12: Flaws in CBO Studies Can Limit Policy Debates and Attorney Actions
This is Part 12 in an ongoing series regarding changes in health care that may take place—and actual changes that do take place—with the Trump administration. The likely implementation issues to be encountered for both potential and actual changes are described, based on detailed methods of analysis. The emphasis is on what these shifts mean for legal practices and how attorneys may prepare in the most effective ways.
The Congressional Budget Office (CBO) continues to evaluate various health policy proposals in terms of their potential impact on funding and services. These study results are often seen as authoritative and an appropriate basis for Congressional decision making. However, much less understood are the limitations and flaws that are “built into” many of these studies.
This issue has been considered in a June 2, 2017, article by Yuval Levin in the National Review. Levin has provided an overview of the limitations often associated with CBO studies.
In his article, Levin also points out that health policy studies may often produce inaccurate forecasts, not only because of conceptual limitations in the predictive models being used but also due to the ways in which analysts interpret model results. Further, efforts by policy makers to “game” the models in use may also distort the results that are obtained.
As a result, CBO evaluations may not accurately reflect the likely impact of policy proposals.
Over the past decade, we have described this same problem in our work. As noted in our books cited below, it may be argued that present approaches to forecasting the likely impact of health policy proposals do not adequately reflect how the reactions by those affected will help reshape program outcomes. Individuals and organizations will adapt to protect their own perceived interests, changing the results of new laws and regulations.
Without new strategies for dealing with these issues, actual program outcomes will continue to be quite different from those projected by standard modeling techniques. To aid in better understanding likely outcomes, we have described several useful “lessons learned” from implementation of the Affordable Care Act (ACA).
In his article, Levin notes that there are structural and conceptual problems with the models being used by the CBO and how they are being applied. There are particular problems with estimating the impact of competition on program design—which involves specific types of reactions by affected individuals and organizations.
He also notes that analysts can choose to adjust the assumptions that they make, and can thereby change conclusions. These assumptions are often not transparent.
Finally, Levin observes that Congress can manipulate (attempt to game) the results of CBO studies by specifying baselines and constraints that are to be used for studies.
Levin concludes that the original CBO studies for the ACA and Medicare prescription-drug program were flawed due to such factors, and that ongoing studies for the proposed American Health Care Act (AHCA) demonstrate similar failures. The analyses do not reasonably reflect likely program outcomes and describe the uncertainties in predictions.
If they better understand the situation, attorneys may be encouraged to question program predictions by the CBO and to intervene in new ways to protect client interests. Where CBO studies seem to imply a high degree of sureness about program outcomes, a realistic assessment of these results can lead to an awareness of limitations and flaws in such forecasts and provide insights that allow for more effective legal actions.
The lessons we have developed from implementation of the ACA can assist attorneys in their representation of clients. These lessons are listed in blog post one in this series; applied to Medicaid block grants in blog post 10; and discussed in detail in our book Legal Practice Implications of Changes in the Affordable Care Act, Medicare and Medicaid.
This post was written by Ferd H. Mitchell and Cheryl C. Mitchell, Thomson Reuters authors and attorney partners at Mitchell Law Office in Spokane, Wash. They are active in elder law and health law practice areas and have been working together on programs and activities on behalf of the elderly and in health care for more than 25 years. During their studies, they have visited and evaluated the health care systems of Japan and several countries in Europe to learn how the needs of the elderly are assessed and met in other countries, and they have been better able to understand the U.S. health care system and related care issues from these visits. More about the lessons learned from the ACA and issues involved in health program changes may be found in the 2017 edition of the authors’ book, Legal Practice Implications of Changes in the Affordable Care Act, Medicare and Medicaid, published by Thomson Reuters. More about these methods of analysis may be found in Mitchell & Mitchell, Adaptive Administration, published by Taylor and Francis. Follow the links below to read previous installments from this series:
The views and opinions expressed in this post are those of its authors alone.