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Speaker 1: Welcome to the Truth with Lisa Booth, where we get

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Speaker 1: to the heart of the issues that matter to you. Today,

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Speaker 1: we're diving into the real cost of Obamacare with one

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Speaker 1: of its sharpest critics, Brian Blaze. He's a former Trump

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Speaker 1: White House health policy advisor and president of Paragon Health Institute.

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Speaker 1: We're talking skyrocketing premiums, billions in fraud, phantom enrollees, and

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Speaker 1: massive insurer windfalls. Also a brand new GAO bombshell showing

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Speaker 1: fake applications were approved at a ninety six percent rate.

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Speaker 1: Brian just testified before Congress. We're going to get him

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Speaker 1: on those enhanced Obamacare premiums. Why are costs going up?

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Speaker 2: And also what.

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Speaker 1: Reforms could actually fix this mess that President Trump could

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Speaker 1: do and the Trump administration can do. Brian Blaze coming

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Speaker 1: up next, Stay with us.

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Speaker 2: Well, Brian, it's great to have you on the show.

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Speaker 3: I've been wanting to have you on since Senator Johnson

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Speaker 3: a name drop you with the beefed up Obamacare premium fight,

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Speaker 3: So been wanting to have you on and talk about

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Speaker 3: this issue.

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Speaker 2: So appreciate you making time.

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Speaker 4: I'm happy to be on. Thanks so much for having me.

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Speaker 2: You'll appreciate years ago.

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Speaker 3: I actually debated Jonathan Gruber on Box News about Obamacare,

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Speaker 3: So that was that was interesting. But my objective was

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Speaker 3: I just like made him really angry at first, and

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Speaker 3: then he lost his mind and looked like a crazy person.

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Speaker 2: But so it worked.

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Speaker 3: All right, Well, let's talk about the state of Obamacare

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Speaker 3: and healthcare right now. Like, first of all, I mean,

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Speaker 3: Democrats obviously just shut down the government for the longest

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Speaker 3: shutdown in history so far. Over these enhanced Obamacare premiums

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Speaker 3: that were always supposed to be temporary. They were approved

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Speaker 3: under the Inflation Reduction Act, which we all know was

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Speaker 3: actually a climate bill.

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Speaker 1: I had thing to do with reducing inflation. In fact,

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Speaker 1: added to inflation made it worse.

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Speaker 3: But they're always supposed to be temporary, and now they're

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Speaker 3: telling us that if we don't extend them, then premiums

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Speaker 3: are going to drive up for a lot of Americans

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Speaker 3: across the country.

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Speaker 2: Like what happened? What do these do? And is that true?

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Speaker 4: Yeah? So, to take a step back, Obamacare primarily affected

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Speaker 4: the individual market for health insurance, which is where people

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Speaker 4: go that don't have an employer plan and aren't enrolled

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Speaker 4: in Medicare or Medicaid. It's key regulations mandates price controls

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Speaker 4: took effect in twenty fourteen. They significantly drove up premiums

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Speaker 4: in the individual market. Obamacare included two other provisions to

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Speaker 4: stabilize that market, large subsidies for people to afford the

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Speaker 4: coverage that the government regulations had made more expensive, and

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Speaker 4: the individual mandate tax penalty, which assessed a fine on

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Speaker 4: individuals that didn't buy the required coverage. Now, the tax

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Speaker 4: penalty was completely ineffective. It didn't bring people into the market. Unfortunately,

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Speaker 4: Congress eliminated that tax penalty, and it had very little

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Speaker 4: effect twenty twenty. Really, from twenty fifteen to twenty twenty,

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Speaker 4: it was a pretty low performing market. Enrollment was way

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Speaker 4: below expectations. In twenty twenty one, as you mentioned, the

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Speaker 4: Democrats used the budget reconciliation process without any Republican support,

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Speaker 4: to expand upon the original Obamacare subsidies they had extended

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Speaker 4: them in the Inflation Reduction Act and set them to

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Speaker 4: expire after twenty twenty five. Now premiums are going up

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Speaker 4: next year. Premiums are going up because of underlying problems

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Speaker 4: with Obamacare, not because of the enhanced subsidies expiring. The

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Speaker 4: enhanced subsidies expiring affect the amounts that the enrolle pays

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Speaker 4: versus the amount that the taxpayer pays. I think the

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Speaker 4: first essential point for everyone to know is that the

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Speaker 4: underlying subsidies continue and are still very large. So for

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Speaker 4: the typical enrollee next year, the government is still going

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Speaker 4: to pay more than eighty percent of the premium. The

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Speaker 4: issue is should the tax payer be paying ninety three

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Speaker 4: percent of the premium, Because that's it. The enhanced subsidies continue,

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Speaker 4: the taxpayer is paying virtually all the premium, and for

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Speaker 4: about half of enrollees, because of these COVID era enhanced subsidies,

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Speaker 4: they're paying zero. And what that has done is create

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Speaker 4: a climate where fraud and abuse have been able to

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Speaker 4: flourish in the exchanges well.

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Speaker 3: And also for the enhanced Obamacare, as you mentioned, this

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Speaker 3: was a covid era thing that happened, which is why

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Speaker 3: it was supposed to be temporary. But it's also not

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Speaker 3: for lower income people. I mean, the enhanced premiums impacted

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Speaker 3: higher income earners as well.

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Speaker 2: Correct, that's right.

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Speaker 4: Original obamacareies limited the government financial assistance to people with

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Speaker 4: income less than four times the poverty line. The COVID

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Speaker 4: credits lifted that cap. So you have some households that

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Speaker 4: make three, four, even five hundred thousand dollars that are

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Speaker 4: now getting government subsidies. And I should say one other

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Speaker 4: thing about these government subsidies. They are direct payments from

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Speaker 4: the US Treasury to health insurance companies, which is why

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Speaker 4: health insurance companies, you know, they're spending more money this

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Speaker 4: year than they ever have lobbying to try to get

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Speaker 4: these handouts from the federal government continued.

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Speaker 3: Basically, it's the same thing we see with student loans

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Speaker 3: that the more the federal government gets involved, you have

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Speaker 3: colleges and universities, they increase the cost because they know

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Speaker 3: what's going to be covered by the government, and so

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Speaker 3: insurance companies are essentially doing the same thing.

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Speaker 4: I would increase exactly right. I would encourage your listeners

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Speaker 4: to google chart of the Century put out by the

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Speaker 4: American Enterprise Institute, and from two thousand to present day.

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Speaker 4: It shows price increases by major sectors of the economy,

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Speaker 4: and the prices that have increased the most are healthcare,

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Speaker 4: and the prices that have increased the second most are education.

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Speaker 4: Hospital prices have increased three times faster than inflation since

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Speaker 4: two thousand. It really is bad government policy that is

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Speaker 4: both inflating demand and restricting supply and has led to

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Speaker 4: healthcare in the US becoming increasingly unaffordable.

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Speaker 3: Do you find it ironic that something is called the

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Speaker 3: Affordable Care Act but is not affordable and we know

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Speaker 3: it's not affordable because the government has to subsidize it

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Speaker 3: up to eighty percent, which is what you had previously said.

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Speaker 4: Yeah, I mean, and the Inflation Reduction Act increased inflation

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Speaker 4: as well, So I mean. The name that they give

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Speaker 4: to these programs are often not reflective of what they

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Speaker 4: actually do. And it is now it's agreed. Republicans the

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Speaker 4: Democrats agree that the Affordable Care Act did not make

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Speaker 4: health insurance more affordable. Like if you go back to

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Speaker 4: President Obama's original promise that they would reduce that Obamacare

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Speaker 4: would reduce premiums by twenty five hundred dollars for family, like,

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Speaker 4: that's patently untrue. Premiums have escalated and you cannot have

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Speaker 4: a system. The regulations in Obamacare are inflationary. They put

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Speaker 4: upward pressure on prices and premiums for the vast majority

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Speaker 4: of Americans. The subsidy structure is also independent of the regulations,

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Speaker 4: it's inflationary. The way the subsidy structure works is that

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Speaker 4: it caps the amount that enrollee has to pay for

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Speaker 4: a plan, so anything above that amount is paid by

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Speaker 4: the taxpayer. So as premiums go up over time and

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Speaker 4: rollees are held harmless from the premium increase, the taxpayer

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Speaker 4: pays the entire premium increase. And what that does is

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Speaker 4: given Sure's enormous pricing power because they know that the

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Speaker 4: enrollee is insensitive to the price increase, that it's all

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Speaker 4: going to be paid by that So it has led

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Speaker 4: to independent of the regulations and inflationary aspect of Obamacare.

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Speaker 1: I mean, just how much has Obamacare increased premiums.

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Speaker 4: From twenty thirteen to twenty fourteen. The initial increase was

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Speaker 4: about fifty percent. From twenty fourteen to twenty twenty six,

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Speaker 4: premiums have gone up another almost one hundred and thirty percent.

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Speaker 4: And to put that in comparison to employer plan premiums,

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Speaker 4: since twenty fourteen, Obamacare plan premiums have increased about twice

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Speaker 4: as fast as employer plan premiums.

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Speaker 1: Was the whole point of Obamacare to move us closer

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Speaker 1: to a single pair system.

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Speaker 4: I mean, I think they wanted to expand health insurance coverage.

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Speaker 4: They did that primary through a dramatic expansion of the

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Speaker 4: Medicaid program, which has its own set of problems, and

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Speaker 4: they were hoping to create a robust individual market centered

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Speaker 4: on this new regulatory regime, the individual mandate to bring

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Speaker 4: people in and subsidies to help lower income people have

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Speaker 4: coverage be more affordable. I don't think that they were

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Speaker 4: intending the authors were intending on moving to a single

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Speaker 4: payer system. I think though, that their central planning has

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Speaker 4: utterly failed, and the reality is that they have moved

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Speaker 4: this more to a central a single payer system because

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Speaker 4: of how poorly Obamacare has borne out in reality.

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Speaker 2: Why hasn't Congress fixed it? Then?

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Speaker 3: You know, you had mentioned that both Democrats and Republicans

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Speaker 3: acknowledged that things aren't working, that costs have been driven up.

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Speaker 2: So why haven't they done anything about it? Is it the.

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Speaker 1: Complexity, the lack of being able to work together.

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Speaker 2: All of it. You know what's behind that?

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Speaker 4: So it's a great question, and I don't have a

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Speaker 4: perfect answer for this. I would say that some aspects

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Speaker 4: of Obamacare have been repealed, and probably aspects that made

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Speaker 4: the whole thing less popular have been repealed. So the

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Speaker 4: individual mandate, like I mentioned, that was repealed in twenty

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Speaker 4: seventeen during President Trump's first term, when Republicans were in

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Speaker 4: control of both chambers of Congress, and repealing the individual

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Speaker 4: mandate did take pressure political pressure off of the overall

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Speaker 4: program because you were then freeing ten million people from

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Speaker 4: having to pay government penalties for not purchasing the coverage.

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Speaker 4: And the Trump administration also, and I was involved with this,

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Speaker 4: we opened up alternatives to Obamacare, so if the coverage

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Speaker 4: was really unaffordable for individuals, there were ways for small

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Speaker 4: businesses and individuals to purchase coverage outside of Obamacare. I

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Speaker 4: think the Democrats just haven't grappled with the reality of

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Speaker 4: the law, and rather than looking to reform the program

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Speaker 4: and address some of the key structural flaws, they decided

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Speaker 4: to just increase the subsidies that go directly to insurance companies.

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Speaker 4: And you see that their reform preference now is just

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Speaker 4: to continue the underlying subsidies to health insurance companies that

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Speaker 4: they boosted in COVID without any reforms. They're not talking

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Speaker 4: about a single actual structural reform to the law, just

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Speaker 4: increasing subsidies to health insurance companies. My hope from what

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Speaker 4: happens is that Congress allows the enhanced subsidies to expire

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Speaker 4: and that forces a rational conversation about the flaws in

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Speaker 4: Obamacare and a way to improve both the regulatory structure

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Speaker 4: and the subsidy structure.

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Speaker 1: Got to take a quick commercial break more with Brian

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Speaker 1: on the other side. You know, I've had to deal

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Speaker 1: with this for a long time because even though I'm employed,

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Speaker 1: I'm a contractor more or less, and so I've had to,

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Speaker 1: you know, get health insurance.

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Speaker 3: It's on the exchange. We pay a lot, you don't

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Speaker 3: get a lot. It's very frustrating. And then at one

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Speaker 3: point I rolled the dice when I was younger with

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Speaker 3: not having insurance, and then you had the penalty. But

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Speaker 3: my understanding is it never really had teeth, and then

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Speaker 3: obviously it was repealed. But so I've kind of been

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Speaker 3: subject to all of this unfortunately.

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Speaker 4: So I've actually Paragon offers something called an individual coverage

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Speaker 4: Health Reimbursement Arrangement, which was an option opened by the

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Speaker 4: Trump administration, and you take that to buy an Obamacare

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Speaker 4: compliant plan in the individual market. So I've had Obamacare

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Speaker 4: coverage myself for four years, and you know, we just

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Speaker 4: got noticed that our premium for next year is going

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Speaker 4: to thirty three thousand dollars with a fourteen thousand dollars deductible.

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Speaker 4: I mean that is a sign that a program is

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Speaker 4: totally off the rails and in need of reform. You know,

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Speaker 4: I also highlighted in my testimony of a family of

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Speaker 4: five in Prescott, Arizona, where their premium next year exceeds

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Speaker 4: fifty and I mean that is just it's unconscionable. We

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Speaker 4: can't we can't just continue to throw more good money

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Speaker 4: after bad that has led to a program that has

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Speaker 4: produced such high premiums for coverage.

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Speaker 3: Yeah, I know I need to look and slutch my

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Speaker 3: plan for next year, and I'm afraid to do it.

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Speaker 2: I've been so busy traveling.

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Speaker 1: I keep putting it off, but I'm afraid to look.

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Speaker 1: I feel like it's not going to be pretty. You know,

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Speaker 1: talk about you had mentioned the fraud before, walk us

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Speaker 1: through the fraud, and then I know there was also

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Speaker 1: a new GAA report report as well, So walk us

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Speaker 1: through the fraud that we have seen.

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Speaker 4: Sure, So I'll start with a paragon's research on this

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Speaker 4: We dug into the improper enrollment back in the summer

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Speaker 4: of twenty twenty four, and what we looked at is

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Speaker 4: the number of enrollees signing up claiming income in a

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Speaker 4: narrow band that qualifies for a fully subsidized plan with

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Speaker 4: the actual number of people in a state that would

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Speaker 4: be eligible for that plan. And we found in twenty

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Speaker 4: twenty four there were five million more people enrolled in

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Speaker 4: a fully subsidized plan than were eligible, and in twenty

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Speaker 4: twenty five that increased to six point four million people.

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Speaker 4: The second A lot of these there's been good news

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Speaker 4: articles that have really gone through these fraud schemes, and

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Speaker 4: you may have seen you drive around you see these

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Speaker 4: signs free Obamacare, call this number. There are also social

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Speaker 4: media campaigns where they advertise cash or gift cards if

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Speaker 4: you call the number. People would call this number and

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Speaker 4: they would ask for a gift card or cash and

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Speaker 4: they would get signed up into health insurance instead. So

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Speaker 4: a lot of these people that were signed up for

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Speaker 4: health insurance had no idea that they were being enrolled.

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Speaker 4: And one of the things you would expect is if

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Speaker 4: you're signing up a lot of people who don't know

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Speaker 4: that a're enrolled is that they're not going to use

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Speaker 4: their health insurance plan. So in August, CMS put out

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Speaker 4: data on people that didn't use the plan a single time,

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Speaker 4: and they put it out from twenty nineteen to twenty

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Speaker 4: twenty four, and what it revealed is that in twenty

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Speaker 4: twenty four, thirty five percent of all Obamacare and rolies

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Speaker 4: didn't use their plan a single time. Forty percent of

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Speaker 4: these fully subsidized enrolies didn't use their plan a single time.

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Speaker 4: That's more than twice what you see in a normal

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Speaker 4: health insurance market and what you saw in Obamacare before

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Speaker 4: the enhanced subsidies. Go came out with rely's bombshell report

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Speaker 4: yesterday where they created fictitious applications. They created over the

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Speaker 4: course of the late twenty twenty four through early twenty

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Speaker 4: twenty five, twenty four fake applications, and so they were

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Speaker 4: missing social Security information, wage information, all this information that

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Speaker 4: you need in order to get that you're supposed to

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Speaker 4: need in order to get coverage. And GEO successfully enrolled

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Speaker 4: twenty three of the twenty four people in exchange plans

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Speaker 4: with a subsidy that covered the entire amount of premium.

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Speaker 4: So it shows systematic failures in how the exchanges are

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Speaker 4: processing eligibility and really just shows the ease with which

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Speaker 4: bad actors have been able to manipulate applications, sign people

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Speaker 4: up again, they sign people up. The payments go directly

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Speaker 4: from the Treasury to the health insurance company, so the

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Speaker 4: insurance companies are reaping windfalls. And then these unscrupulous agents

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Speaker 4: and brokers get a monthly commission for every month that

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Speaker 4: the individual is enrolled. So unfortunately, you know, because of

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Speaker 4: bad policy, really negligent Biden administration oversight, the exchanges have

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Speaker 4: just become a cesspool for fraud and abuse.

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Speaker 3: Okay, so Jo, if twenty three out of twenty four

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Speaker 3: fictitious applications were approved, Joe Biden just let in millions

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Speaker 3: of illegal aliens into the country on top of the

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Speaker 3: millions more that we're already here. What is the likelihood

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Speaker 3: or what do we know about illegal aliens being able

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Speaker 3: to get on the exchange.

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Speaker 4: Well, I mean, I would say the likelihoods one hundred

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Speaker 4: percent that there are illegal aliens on the exchange. I

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Speaker 4: mean the precise number, I'm not sure of that. Like,

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Speaker 4: you know, if I would guess, I would say probably hundreds,

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Speaker 4: hundreds of thousands potentially enrolled in the exchanges with subsidies,

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Speaker 4: and many of them may have no idea that they're

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Speaker 4: enrolled as well, they were just picked off in these

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Speaker 4: fraud schemes.

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Speaker 2: Before we go, what should Republicans do?

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Speaker 1: Like, how do we You know, it's often very difficult

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Speaker 1: to put the genie back in the bottle once these

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Speaker 1: government programs. We have a history as a country of

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Speaker 1: once these programs get created, it's very.

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Speaker 2: Hard to calm back. But what is your hope for healthcare?

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Speaker 1: What could Republicans do that would actually drive down costs

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Speaker 1: for Americans?

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Speaker 4: So the first thing I would recommend is to allow

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Speaker 4: these enhanced subsidies to health insurance companies to expire. I

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Speaker 4: then think you can look at three different sets of policies.

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Speaker 4: One is how can we redirect subsidies away from insurers

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Speaker 4: and funding the system to funding the patient instead. And

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Speaker 4: there are proposals out there that would redirect some of

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Speaker 4: these subsidies away from the system and to the patient,

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Speaker 4: because what we want is a health sector that's more

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Speaker 4: responsive to the patient. Paragon put out a proposal called

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Speaker 4: the HSA option three and a half years ago that

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Speaker 4: is a practical policy for how we could start moving

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Speaker 4: subsidies away from insurers and to individuals. I think second,

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Speaker 4: people need to have more control over their healthcare dollars.

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Speaker 4: They need more options for the types of coverage to purchase.

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Speaker 4: And we need more innovation on the financing side rather

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Speaker 4: than sort of one size fits all comprehensive insurance plans.

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Speaker 4: So more options for small employers and for individuals to

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Speaker 4: purchase coverage. And I gave testimony before the Senate Finance

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Speaker 4: Committee two weeks ago where I lay out several options

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Speaker 4: like this. And then third, I think there are Alabamacare

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Speaker 4: needs within it fundamental reforms. There are regulations that push

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Speaker 4: up premiums, and the subsidy design, like I mentioned, is inflationary.

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Speaker 4: There should be a way to redesign the subsidy structure

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Speaker 4: so that we have enrollees sensitive to the premium changes

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Speaker 4: over time and don't put the entire amount of responsibility

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Speaker 4: on the federal tax payer when premiums go up.

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Speaker 2: Brian, thank you so much for coming on the show.

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Speaker 2: Really appreciate it.

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Speaker 1: Thank you very much those Brian Blaze appreciate him from

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Speaker 1: making time to come on the show. Appreciate you guys

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Speaker 1: at home for listening every Tuesday and Thursday, but you

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Speaker 1: can listen throughout the week. I also want to thank

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Speaker 1: my producer John Cassio for putting the show together.

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Speaker 2: Until next time,