Betsy McCaughey's Latest Health Care Claim Based On Flawed 2011 Survey

McCaugheySerial health care misinformer Betsy McCaughey falsely claimed that 25 million consumers in the small-group health insurance market would lose coverage due to the Affordable Care Act (ACA), citing a controversial and widely criticized 2011 survey that admitted it “was not intended as a predictive analysis of the impact of the Affordable Care Act.”

In a January 14 New York Post op-ed, McCaughey claimed the ACA “will hurt twice as many people as it helps” by making “employer-provided policies illegal” for millions of Americans. As evidence, McCaughey pointed to a February 2011 survey to claim that “a conservative estimate is that 25 million people, out of the 60 million in small group plans, get dropped in 2014”:

Even the chance that ObamaCare's “employer mandate” will go into effect in 2015 isn't apt to deter employers from dropping coverage. The penalty for not complying with the mandate would add only 98 cents an hour for a 40-hour worker -- a bargain compared with the $1.79 cost of providing coverage plus the enormous amount of red tape, reporting requirements and fees that ObamaCare piles on employers who provide coverage. In truth, the law discourages employers from insuring their workers, making it far easier and cheaper to send them to the exchanges.

That's why the management consultants at McKinsey & Co. warned in 2011 that nearly a third of employers surveyed already were considering dropping coverage, with the figure rising among those familiar with the law's requirements.

So a conservative estimate is that 25 million people, out of the 60 million in small group plans, get dropped in 2014. Add that to the 5 million or so whose individual-market already canceled on Jan. 1, and you have a lot of losers.

McCaughey's “conservative estimate” was extrapolated from a two-year-old survey conducted by management consultant company McKinsey & Company that “offers a snapshot of attitudes that suggests the shift away from employer-provided health insurance could be greater than expected.” But in the introduction to McKinsey's post on its own survey, the firm admits that the survey “was not intended as a predictive analysis of the impact of the Affordable Care Act.” The survey's methodology further warns:

The survey was not intended as a predictive economic analysis of the impact of the Affordable Care Act. Rather, it captured the attitudes of employers and provided an understanding of the factors that could influence decision making related to employee health benefits.

As such, our survey results are not comparable to the healthcare research and analysis conducted by others such as the Congressional Budget Office, RAND and the Urban Institute. Each of those studies employed economic modeling, not opinion surveys, and focused on the impact of healthcare reform on individuals, not employer attitudes.

Although the survey was celebrated by right-wing media outlets when it was released in June 2011, it was the subject of intense criticism from experts who argued that the findings were flawed. In a post on his New York Times blog, economist Paul Krugman warned that “nobody should be quoting this study” in policy debates. In a June 23, 2011, post, Talking Points Memo quoted survey research expert Floyd Fowler who “compared McKinsey & Company's controversial health care study to a push poll, calling into further question whether its results can be trusted as even a snapshot of employer sentiment”:

“There is no doubt that the answers one would get after priming respondents the way they did would be expected to include more expressed interest in the possibility of not insuring employees than a question asked in a nonprimed context,” said Floyd Fowler, a Senior Research Fellow at the Center for Survey Research at University of Massachusetts, Boston, and author of the book Survey Research Methods.


"[T]he fact that someone spent time thinking up, then outlining to corporations, ways to circumvent the law in such amazing ways seems like a pretty good story all by itself," Fowler says. "... What is intriguing to me is whether in fact they may have increased corporation interest in exploring ways to avoid providing insurance to their employees by the act of suggesting these possible approaches. In the political polling world, as you probably know, push polling is used to plant ideas in voters' heads: If I told you that CANDIDATE A has had two abortions and stopped going to church at an early age, who would you be most likely to vote for: A or B? Such a question will change the distribution of answers, but also may disseminate ideas about candidate A."

McCaughey's choice of evidence for her prediction is even more irresponsible considering that the McKinsey survey was released at the same time as an Avalere Health review of analyses by actual health care experts which found that “the ESI market will be fairly stable after 2014 when key ACA coverage provisions go into effect”:

Overall, our analysis suggests that the ESI market will be fairly stable after 2014 when key ACA coverage provisions go into effect. The microsimulation models estimates from RAND, the Urban Institute, the Lewin Group and the Congressional Budget Office (CBO) show net changes to ESI ranging from -0.3 percent to + 8.4 percent compared to baseline projections without ACA implementation - not major changes in the market (Figure 1). Similarly, large-scale employer surveys and analyses conducted by benefits consultants, investor groups, and other consulting firms also confirm that most employers will remain committed to providing coverage. Stability in ESI is driven by expectations that large firms, whose policies cover more people than small- and medium-firm policies combined, will continue offering health benefits. Moreover, small businesses that will benefit from new economies of scale in the small business exchanges are likely to offer coverage for their employees through the exchange and possibly newly offer coverage if they previously did not.