Election day is just days away. And the media's slanted coverage threatens to leave many voters misinformed. As an economist, I've noticed an especially staggering bias in how the media depicts the Biden-Harris administration's redesign of Medicare.
The Inflation Reduction Act overhauled Medicare's prescription drug benefit. The changes are projected to result in the federal government spending about $300 billion less on medicines over a decade.
ABC News and many other outlets have characterized that $300 billion change as a "savings."
But imagine if Republicans had pushed through changes to Medicare, Medicaid, or Social Security that resulted in a $300 billion reduction in the services provided to seniors. Is there any doubt that the media would describe it -- accurately -- as a cut?
Or consider how the media is portraying the administration's efforts to stave off politically damaging Medicare premium hikes.
The Inflation Reduction Act shifted many expenses onto the private insurers that sponsor and administer Medicare Part D plans. As a result of the changes, the "national average monthly bid amount" -- essentially, the cost of a typical senior's coverage -- jumped 179% for next year. Typically, insurers would pass most of the new expenses along in the form of higher premiums, meaning millions of seniors would receive notices of massive hikes just before the election.
To prevent such a damaging "October surprise," the Biden-Harris administration devised a stop-gap maneuver. Administration officials recently announced a "demonstration" program -- a term the media has dutifully adopted -- that will transfer $7.2 billion from Medicare trust funds to insurance companies, effectively paying them to hold off on premium hikes.
If a Republican administration tried that, the media would surely call the "demonstration" what it is -- a bailout. TIME called the 2020 CARES Act, passed under Donald Trump to fund the Covid-19 response, a federal "bailout" of corporations. In 2008, the George W. Bush-backed rescue package to prevent bank failures received similar treatment, even though most voters supported the measure.
One must also acknowledge that New York Mayor Eric Adams was just indicted for allegedly funneling $10 million in public funds toward his campaign. But when the Biden-Harris administration siphons $7.2 billion in public funds to save the Harris campaign, the New York Times calls it politically "savvy."
Or consider how the Inflation Reduction Act authorizes federal officials to "negotiate" Medicare drug prices. The term is an Orwellian abuse of the English language. The government simply dictates the prices it wants to pay -- and if a company refuses to accept the government's offer, the feds kick the company out of Medicare entirely. It's a negotiation that only the mob would recognize.
Ironically, these "negotiations" will actually result in higher -- not lower -- out-of-pocket costs for millions of seniors, due to the way the administration redesigned Medicare. A study by the risk-management firm Milliman projects that the IRA's new price-setting mechanisms will increase out-of-pocket costs for low-income Part D beneficiaries by 34%. Yet most of the media continues to trumpet the "savings" that seniors will see from "negotiated" prices.
Democrats' health care policies consistently backfire, costing more than expected and requiring fresh cash injections to avoid collapse. Eventually, it becomes undeniable that taxpayers and patients are worse off.
The question is simply whether voters will see through the bias and realize the truth in time.
Tomas J. Philipson is an economist at the University of Chicago who served on the White House Council of Economic Advisers as a member and acting chairman from 2017–2020.
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