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Thursday, October 30, 2014         

NEW YORK TIMES


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Man behind health care mandate says it’s imperative

By CATHERINE RAMPELL

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After Massachusetts, California came calling. So did Connecticut, Delaware, Kansas, Minnesota, Oregon, Wisconsin and Wyoming.

They all wanted Jonathan Gruber, a numbers wizard at MIT, to help them figure out how to fix their health care systems, just as he had helped Mitt Romney overhaul health insurance when he was the Massachusetts governor.

Then came the call in 2008 from President-elect Barack Obama’s transition team, the one that officially turned this stay-at-home economics professor into Mr. Mandate.

Gruber has spent decades modeling the intricacies of the health care ecosystem, which involves making predictions about how new laws will play out based on past experience and economic theory. It is his research that convinced the Obama administration that health care reform could not work without requiring everyone to buy insurance.

And it is his work that explains why President Obama has so much riding on the three days of U.S. Supreme Court hearings, which ended Wednesday, about the constitutionality of the mandate. Questioning by the court’s conservative justices has suggested deep skepticism about the mandate, setting off waves of worry among its backers — Gruber included.

“As soon as I started reading the dispatches my stomach started churning,” Gruber said of the arguments on Tuesday, while taking a break from quizzing his son for a biology test. “Losing the mandate means continuing with our unfair individual insurance markets in a world where employer-based insurance is rapidly disappearing.”

Gruber, 46, hates traveling without his wife and three children, so he is tracking the case from his home in Lexington, Mass. There he crunches numbers and advises other states on health care, in between headbanging at Van Halen concerts with his 15-year-old son and cuddling with the family’s eight parrots. (His wife, Andrea, volunteers at a bird rescue center.)

If the court rules against the mandate, Gruber says he believes the number of newly insured Americans could fall to 8 million from the projected 32 million. He insists that without a mandate, the law will result in a terrible spiral: Only relatively sick Americans will choose to get insurance, leading premium prices to rise and causing the healthier of even those sick people to drop their insurance, sending prices higher and higher.

Some other economists quibble, though, with Gruber’s pessimistic assessment.

“My general thought about the mandate is if insurance is affordable and accessible, most people will buy it anyway,” said David Cutler, an economist at Harvard and longtime collaborator of Gruber’s.

Others, like Paul Starr, a Princeton sociologist, say they believe Gruber’s work does not account for how difficult it will be to enforce the mandate.

“There is this groupthink about how important the mandate is,” Starr says. “Most people don’t understand or won’t acknowledge how weak the enforcement mechanism is.”

Starr said he thought Gruber in particular was overstating the effectiveness of the mandate because “it’s his baby.”

That said, it is difficult for too many other experts to categorically refute Gruber’s work, since he has nearly cornered the market on the technical science behind these sorts of predictions. Other models exist — built by nonprofits like the RAND Corp. or private consultancies like the Lewin Group — but they all use Gruber’s work as a benchmark, according to Jean Abraham, a health economist at the University of Minnesota and former senior economist in both the Obama and George W. Bush administrations.

“He’s brought a level of science to an issue that would otherwise be just opinion,” Cutler says. “He’s really the only person who has been doing all this careful modeling for so long. He’s the only person you can go to for that kind of thing, which is why the White House reached out to him in the first place.”

Obama had made health care reform a cornerstone of his campaign, and wanted to announce a credible proposal quickly after taking office. But members of the Obama administration’s transition team said they had inherited an executive branch that had vastly underinvested in modeling research on health care, especially compared to the technical modeling that had been done in areas like tax policy.

“Creating a good model from scratch would have taken months, maybe years,” said Lawrence H. Summers, who was the director of Obama’s National Economic Council and had advised Gruber on his dissertation when they were at Harvard.

Gruber had already spent years researching government mandates, starting with his 1991 dissertation about how mandated employer benefits cut into workers’ wages.

He also did similar analyses, on a broader range of public policies for the Treasury Department in the Clinton administration from 1997-98, He was recruited by Summers, who was then deputy secretary of Treasury.

Then in 2001, after returning to MIT, Gruber received an email from Amy Lischko, who was then an assistant commissioner in the Massachusetts healthy policy department under then-Gov. Jane M. Swift, a Republican.

She was familiar with his work, and contracted him to model some potential ways that Massachusetts could expand health insurance coverage.

“He certainly wasn’t as well known then as he is now in the health care arena,” said Lischko, now a professor at Tufts University School of Medicine. “We couldn’t exactly kick the tires on these kinds of models back then, but we knew he had done work on simulations before.”

Gruber calls himself a “card-carrying Democrat.” He and his wife host a “great quadrennial Democratic victory party” whether or not the Democratic candidate wins, he said. But given his reputation and relatively rare expertise, he still ended up working for two Republican governors in Massachusetts.

When Romney succeeded Swift in 2003, he proposed using an individual mandate to help the state achieve universal health care coverage. Gruber was again brought in to analyze the idea, which he had not formally modeled before.

“Romney saw it as a traditional Republican moral issue of personal responsibility, getting rid of the free riders in the system, not as much of an economic issue,” Gruber said. “Not only were the Republicans for it, the liberals hated it. People forget that.”

Obama had vehemently opposed an individual mandate before his election in 2008.

After the Massachusetts plan passed in 2006, Arnold Schwarzenegger, then the Republican governor of California, invited Gruber to Sacramento to help model a similar proposal.

“That was awesome,” Gruber says, his eyes widening at the memory. “I got to see the sword from Conan the Barbarian.”

The California proposal fell apart, but soon Gruber had a little cottage industry helping states model potential health system changes. He also serves on the Massachusetts board that oversees the state’s new health care exchanges.

Along with these credentials, Gruber’s position as an adviser to the influential Congressional Budget Office also left him perfectly positioned to advise the White House on health reform.

“The most important arbiter of everything was the CBO,” said Neera Tanden, who was a senior adviser for health reform at the Department of Health and Human Services.

The CBO’s assessment of a bill’s efficacy and costs strongly influences political debate, but the office does not publicly reveal how it calculates those numbers.

“We knew the numbers he gave us would be close to where the CBO was likely to come out,” Tanden said. She was right.

After Gruber helped the administration put together the basic principles of the proposal, the White House lent him to Capitol Hill to help congressional staff members draft the specifics of the legislation.

This assignment primarily involved asking his graduate student researchers to tweak his model’s software code. It was also almost entirely conducted from his home office, while his children were at school and then after they had gone to bed.

“If I wanted to be in Washington, I’d have taken a job in Washington,” he said. “I wanted to be around for my family.”

Even though he was brought in by the White House, congressional staff members from both parties trusted him because he was seen as an econometric wonk, not a political agent. But soon his very involvement with the bill caused questions about his objectivity to be raised in the news media.

During and after the bill’s slog through Congress, he frequently spoke with reporters and wrote opinion pieces supporting the Affordable Care Act but did not always mention his role in helping to devise it.

He says he regrets not being more upfront about his involvement with the administration. But he does not apologize for publicly advocating for the legislation, and continuing to do so — including through a comic book he wrote to explain the law.

“Yes, I want the public to be informed by an objective expert,” he says. “But the thing is, I know more about this law than any other economist.”






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