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How 'Explanatory Journalism' Gets Medicare Wrong

1:47 PM, Jul 30, 2014 • By MARK HEMINGWAY
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As I've made pretty clear, I am not a fan of the "explanatory journalism" trend that purports to take an empirical approach to explaining complex issues. Its chief practitioners are a bunch of young, terribly biased journalists who tend to treat politics and policy as some sort of game, even as they broadcast their ignorance. Anyway, if you want a concise example of why explanatory journalism is bad—so pure and crystalline it could have been produced by Walter White—let me direct you to this piece on Medicare. 

Right off the bat, the headline is not encouraging: "Medicare isn't going bankrupt. This chart proves it." Sure enough, Vox has produced a chart showing that for the last 40 years, the Medicare Trustees report has projected the date of Medicare's insolvency and those insolvency dates keep getting pushed back. The conclusion drawn from a narrow and silly set of data points is that "hand-wringing [over Medicare's fiscal predicament] is pretty much unnecessary" because Congress will take care of the problem:

What you'll see here is that this report has predicted, many times in the past, that the Medicare Trust Fund would run out of money. But its never actually happened: each time the projected insolvency date gets close, there's typically a pattern where Congress steps in and passes some type of policy to make trust fund dollars stretch at least a decade longer.

This blase attitude about very real financial problems is one of the defining characteristics of welfare state fan fiction. Read that again: "There's typically a pattern where Congress steps in and passes some type of policy..." Some type of policy? Doesn't it matter what specific policies will be employed to keep Medicare solvent? I mean, we could just double the payroll tax. It might have terrible consequences for working families, but if it keeps Medicare solvent for the rest of the century, problem solved, right?  

Nowhere in the piece does author Sarah Kliff mention that every year the same Medicare Trustees report notes that Medicare's unfunded liabilities grow astronomically even as the even as the projected insolvency dates are put off. So whipping up "policies" to "stretch" the solvency date instead of doing meaningful entitlement reform is allowing the problem to get much worse. Currently, the unfunded liabilities for Medicare are a staggering $43 trillion. That's $7 trillion more than the trustees report said four years ago. 

But it's actually much worse than that. The Medicare Trustees report bases its projections on current law, and the law is currently... Obamacare. That's "some type of policy," all right. In 2010, which is coincidentally the year that Obamacare was passed, the Office of the Actuary at CMS started producing an "alternative scenario" for Medicare predictions not based on current law but on the projected outcome they thought was most likely. At Forbes, Chris Conover notes that Medicare Part A is actually projected to grow at a rate two and a half times as fast under this scenario as it does under the rosy Obamacare-influenced projections.

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