More Lies: WH Emails Reveal Major Obamacare Accounting Fraud
9/15/2011 | Email Guy Benson |

Does the American public have the bandwidth to follow two Solyndra-style White House scandals at once? As maddening as the Solyndra row has been -- and we'll have an update on that story later this morning -- this revelation is probably worse. I reach that conclusion based on the relative scale and consequences of the dueling disgraces' politically-motivated dishonesty. First, a little bit of background to prime the pump:

When Democrats entered their full-court press for Obamacare last winter, they made it clear that nothing would stand in their way. Not hostile public opinion, not sound policy interests, not even a desire to know what was in their own bill. Nothing.

One of their boldest plays was to manufacture a CBO score explictly designed to reach the ludicrous conclusion that theor new multi-trillion-dollar entitlement program would actually reduce the deficit. In order to accomplish this feat, they used smoke and mirrors accounting gimmicks that went far beyond even many Beltway cynics' wildest imaginations.

Rep. Paul Ryan exposed and debunked Democrats' most audacious tricks during the healthcare summit -- which of course did absolutely nothing to convince Democrats of the error of their ways. During his illuminating dissection of the bill, Ryan mentioned a provision called the CLASS Act, a new federally funded long-term care program embedded within Obamacare. Ryan quoted Sen. Kent Conrad, a Democrat, as decrying the program as a Madoff-style "Ponzi scheme." Why? Because the premiums supposedly collected to pay for the CLASS Act over Obamacare's first decade would be injected into that phony, contrived "deficit reducing" CBO formula -- while the program itself would likely collapse under its own weight almost immediately. In other words, some critics suspected, Democrats were creating an entire program just to extract hypothetical dollars from its front-loaded revenue mechanism to "pay for" the larger bill -- with no real intention of implementing a sustainable long-term care program. To outside observers like Ryan, it looked like a giant shell game. As we now know, it looked that way to inside observers, too. The AP has the hugely important exclusive:

Even as leading Democrats offered assurances to the contrary, government experts repeatedly warned that a new long-term care insurance plan could go belly up, saddling taxpayers with another underfunded benefit program, according to emails disclosed by congressional investigators. Part of President Barack Obama's health care law, the program is in limbo as a congressional debt panel searches for budget savings and behind the scenes, administration officials scramble to find a viable financing formula.

So the White House was telling the public everything was copacetic while internal government experts were frantically warning that the administration's ideological plans were profoundly unwise. If this scenario feels strangely familiar, it should. Here's the AP's background on the CLASS Act as well as an explanation of its fatal flaws:

CLASS was intended as voluntary long-term care insurance plan, supported by premiums, not taxpayer dollars. Workers would pay an affordable sum of around $100 a month or less. In exchange, they would receive a modest daily cash benefit averaging no less than $50 if they become disabled later in life. Beneficiaries could use the money for services to help them stay at home, or to help with nursing home bills. The Health and Human Services Department is supposed to set the final premiums and benefit levels in the coming months.

But the program is on a collision course with powerful demographic and economic forces. How to pay the exorbitant cost of long-term care remains a major unmet need for an aging society. On the other hand, many economic experts believe the government has already promised seniors more than it can deliver, and now is not the time to launch another program likely to need a taxpayer bailout or new mandates.

In short, this was a preposterous boondoggle that was bound to fail (by design) from the get-go. The dirty little secret, you see, was that Obama, Inc. didn't care if CLASS failed. The whole point was to show theoretical on-paper "premiums" that added revenue to the black side of the CBO's overall Obamacare ledger. Whether those premiums ever materialized, and whether the program went totally bust, was immaterial. This was purely an accounting scheme contrived to make Obamacare appear less costly. Some veteran government number-crunchers noticed the impossible math and tried to raise the alarm. They were disregarded and frozen out of deliberations for their trouble:

Emails show that the first warning about CLASS came in May 2009, from Richard Foster, head of long range economic forecasts for Medicare. "At first glance this proposal doesn't look workable," Foster wrote in an email to other HHS officials, some of whom were working with Congress to get CLASS into the health care law. Foster said a rough outline of the program would have to enroll more than 230 million people — more than the U.S. workforce — to be financially feasible. But work on CLASS continued, bolstered by a report for AARP that laid out scenarios for implementing the plan. The AARP study also raised financial concerns, although the seniors' lobby supports CLASS. (My note: More incomprehensible treachery from AARP).

In July, Foster tried again. After reviewing the latest information from Kennedy's office, he wrote HHS officials: "Thirty-six years of (professional) experience lead me to believe that this program would collapse in short order and require significant federal subsidies to continue." Too late. The Obama administration had decided to support CLASS. Documents and emails indicate that Foster was edged out of deliberations.

Foster was sent to the corner to sulk. His math was too politically inconvenient, so he was banished to intellectual Siberia. (Say, I thought it was only those anti-science, anti-critical thinking Republicans who did this sort of thing). Foster wasn't the only insider who was extremely critical of the scheme:

By that time, Marton, the HHS aging policy official, was also raising questions internally. Emails he sent other administration officials relayed studies that raised concerns about such issues as premiums and the role of employers, while also recommending fixes. Publicly, the administration maintained it would all work out. A December 2009 presentation for senior officials stressed the end result would be a financially robust program. In private, administration insiders were still spelling out concerns.

They knew it was a lie. Their actuaries told them so. The math was clear. They didn't care. If CLASS goosed the numbers for the broader bill -- thus helping secure the historic power grab they'd been salivating over forever -- these Statists were thrilled to adopt an "ends justifies the means" mentality. And that, my friends, is how the White House and Democrats manipulated the CBO score, lied their asses off to the American public, and passed their unaffordable, unwanted healthcare monstrosity under deliberately false pretenses. This. Crew. Must. Go. ... ting_fraud

AP Exclusive: Long-term care plan alarms ignored ... tArticle=y