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Emails Show Trump Administration Was Told Obamacare Ad Cuts Could Hurt Enrollment

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One projection showed 102,000 fewer sign-ups without TV advertising.

The Trump administration last year eliminated television advertising for HealthCare.gov despite projections suggesting that Obamacare enrollment would fall by more than 100,000 as a result, newly disclosed government emails show.

The decision to cut television advertising, announced in August 2017, was part of a larger and dramatic cut to outreach efforts for the federal government’s insurance website, which is part of the Affordable Care Act. At the time, administration officials said they had no reason to believe those reductions, including the end of TV advertising, would cause fewer people to sign up.

But in a series of email conversations last year, analysts at a private contractor and senior staff at the agency in charge of HealthCare.gov discussed an econometric model designed to predict the likely effect of changes to the advertising budget.

Weeks before the announcement of the cut, one of the analysts cited a prediction that enrollment would fall by 102,029 without television spots promoting HealthCare.gov and the availability of coverage on the site. The estimate, which the analyst described as “very conservative,” covered just a portion of the advertising cuts.

The decision was one in a series of actions, such as yanking funds from organizations that help people enroll, that seemed consistent with Trump’s vow last year that he would “let Obamacare fail.” 

Many experts believe the cumulative effect of these steps over the past two years helps explain why the number of uninsured Americans is edging back up after hitting a record low during the Obama administration and why sign-ups at HealthCare.gov this year are lagging last year’s pace, although open enrollment doesn’t end until Saturday.

What The Emails Say

The emails, which the left-leaning watchdog group Democracy Forward obtained through the Freedom of Information Act and then provided to HuffPost, start in January 2017, when Trump became president. One of his administration’s very first moves was to cut off advertising for the remainder of the 2017 open-enrollment period, which still had a few days to go.

That turned out to be a harbinger. At the end of August, the administration announced it was wiping out nearly the entire promotional budget. Instead of allocating $100 million, as the Obama administration had done for the final year of enrollment it was overseeing, the Trump administration would spend just $10 million. It would also be focusing exclusively on digital advertising and outreach, with no funding at all for television.

Email from the conversation between analysts at a private contractor and senior staff at the Center for Medicare and Med
COURTESY OF DEMOCRACY FORWARD
Email from the conversation between analysts at a private contractor and senior staff at the Center for Medicare and Medicaid Services in which they discuss projections for how reallocating television ad money would affect enrollment.

At the time, officials at the Centers for Medicare & Medicaid Services (CMS) said that they were simply bringing the advertising budget in line with other, more established programs ― and that everybody knew about the new markets already.

Officials also said the decision would not hurt enrollment, distributing a fact sheet with the announcement that said, “No correlation has been seen between Obamacare advertising and either new enrollment or effectuated enrollment.”

On a conference call with reporters, in response to a question about whether the Department of Health and Human Services (which includes CMS) had studied the efficacy of advertising, an official said, “We haven’t done a specific study related to the public awareness of the program.”

But Weber Shandwick, the public relations firm handling HealthCare.gov advertising, had built an econometric model to assess the effects of different advertising methods, such as text messaging, radio spots and digital ads. The model came up in multiple discussions between CMS senior staff and Weber Shandwick analysts.

In a March 23 email, for example, Chris Koepke, a career CMS staffer in charge of the strategic marketing group, wrote to Weber Shandwick analysts to ask if there had been “any success noodling on the Young and Healthy question and the econometric model? We’re getting very close to needing to answer questions in that area.”

In April, Koepke wrote a group email with the subject “Updated Econometric Modeling Deck.” In that message, Koepke wrote, ”Hi everyone – I definitely want to dive into a few things more. But, I’m going to send a few one off questions I’d love answered asap as I’m getting a lot of budgeting questions right now.”

There are several other instances of both CMS and Weber Shandwick staff talking about the model and references to requests for information from political appointees who had decision-making responsibility over Affordable Care Act implementation. (One email addressed to Brian Colas, former chief of staff to CMS administrator Seema Verma, begins, “Brian, as we discussed, this is the deck.”) 

Fact sheet for reporters from the Department of Health and Human Services, distributed in August, 2017, with announcement of
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Fact sheet for reporters from the Department of Health and Human Services, distributed in August, 2017, with announcement of the Trump administration’s 90 percent cut to advertising.

But the most telling discussions are probably a series of communications starting in late July about how to allocate advertising funding for 2018.

In one email, Seth Levin, head of the HealthCare.gov account at Weber Shandwick, wrote, “See the attached chart. ... I then looked at the non-tv plan … The difference is 102,029 enrollments. This is likely a very conservative number, and Greg [presumably another Weber Shandwick analyst] noted the impact could be much more significant.”

Emails in this exchange also include some references to a spreadsheet with the file name “Television v. No Television.xlsx,” although the spreadsheet itself was not included in the Freedom of Information Act disclosure.

What The Emails Mean

All of the emails include large swaths of redacted material, making it difficult to decipher exactly what they show. But Joshua Peck, who was chief marketing officer for HealthCare.gov during the Obama administration, reviewed the emails and said the significance should be clear to anybody who has worked on Affordable Care Act implementation.

“This email shows us that when asked what would happen if the same money budgeted for TV was instead spent on other types of advertising,” Peck said, referring to the message on TV ad projections, “they were told, very conservatively, at least 100,000 fewer people would enroll.”

Peck, who is a co-founder of the nonprofit organization Get America Covered, went on to note that because the Trump administration was wiping out nearly all advertising, not just television, the cumulative effect was likely much greater than 100,000. At the time of the announcement, he published an independent analysis predicting that enrollment would end up more than 1 million lower than it would have been if the ad budget had held steady.

And although Peck said it’s impossible to tell exactly who at CMS had seen the Weber Shandwick analysis, he said the thread “directly contradicts the statement HHS made ... about not having any evidence of any correlation between the impact of outreach. When they made that statement, they were aware or could have easily discovered that there is abundant evidence of its impact.”

Last week, a CMS spokesperson responded to HuffPost’s questions about the analysis by saying there was no clear relationship between advertising and enrollment. (Weber Shandwick referred questions to CMS.) The spokesperson noted, correctly, that overall enrollment had actually fallen in 2017, even though the Obama administration had put more money into promotion of the program that year, before rising back up in 2018, despite Trump’s cut.

“When allocating funds for open enrollment advertising, the results of the prior two years were considered,” the spokesperson said. 

But total enrollment is a function of many forces, including everything from the changing price of coverage to trends in job-based insurance, and the administration had additional reasons to think less advertising would be a force in the direction of lower enrollment.

After studying the effects of outreach efforts in Kentucky, researchers at the Wesleyan Media Project concluded that less advertising could lead to “weaker enrollment and a worsening risk pool for insurers.” An internal study that the Obama administration commissioned found that advertising played a significant role in about one-third of both re-enrollments and new sign-ups at HealthCare.gov and that television had been especially effective when it worked in tandem with other forms of advertising.

And after enrollment dipped for 2017, analysts went back to compare who signed up and when ― and concluded that those cuts to last-minute advertising, right after Trump took office, likely played a big role.

“The reason outreach and advertising matter is that there is a lot of turnover in the marketplace,” said Larry Levitt, senior vice president at the independent nonprofit Henry J. Kaiser Family Foundation. “Each year, millions of marketplace enrollees become eligible for employer-based insurance or Medicaid as their circumstances change. Million more people become eligible for marketplace coverage on an annual basis, but they don’t necessarily know it.”

What The Trump Administration Wants

Trump administration officials bristle at the suggestion that they want the Affordable Care Act to unravel. “I take exception to the claims that we are trying to sabotage Obamacare,” Verma said in a speech this year. “Obamacare was failing long before Donald Trump became president.”

Few informed observers would dispute that problems associated with the Affordable Care Act have a lot to do with both its design and the decisions the Obama administration made while it was running the program.

But since taking office, Trump and his lieutenants have refused to defend the law in court, eliminated rules that steer people away from junk plans and used Affordable Care Act promotional funds to finance ads critical of the program. They also cut off critical funding for state-run insurance programs in Minnesota and New York, restoring the payments only after those states sued.

And although Trump and his allies in Congress failed to pass legislation repealing the Affordable Care Act outright, the tax cut they enacted in late 2017 zeroed out the individual mandate, the financial penalty for people who decline to get insurance when the law deems it affordable.

There’s now a lot of debate over how much of an effect the mandate actually has ― and just how all the other influences on the market will blend together. But as of this week, with open enrollment about to end, enrollment at HealthCare.gov was running 11.7 percent behind last year’s pace, with enrollment among new consumers down 19.7 percent.

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The majority of Americans say they did not get a pay raise this year

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The economy is thriving, but many Americans say they aren’t seeing a difference in their paychecks

Although the economy saw new peaks in 2018, not all Americans report reaping the benefits. The majority of workers say they saw no salary increases this year, according to a new survey.

More than 60% of Americans said they didn’t get a pay raise at their current job or get a better-paying job in the last 12 months, according to a survey released Wednesday from finance site Bankrate.com. Meanwhile, executives have seen a surge in compensation, according to an August study from the Economic Policy Institute. The average chief executive officer at the 350 largest firms in the U.S. received $18.9 million in compensation in 2017, the study showed, a 17.6% increase over 2016.

Despite those disparities, 91% of Americans say they have the same or greater confidence in the job market than they did one year ago, according to Bankrate.com.

“The result of trickle-down economics is plain to see in this survey,” Melissa Boteach, senior vice president of the Poverty to Prosperity program at the Center for American Progress, said. “The people at the top are getting richer and richer and everyday working families are not getting their fair share.

Though several states — and some companies including Amazon AMZN, +1.74%   — have moved to increase the minimum wage, the federal minimum wage has been $7.25 since 2009. Studies show a $15 wage is the minimum amount needed to keep low-wage workers out of poverty. The cost of living has increased in recent years, with consumer inflation hitting a 6-year high in July 2018.

“People are living in precarious financial situations because wages have not kept pace with cost of living,” Boteach said. “If a car breaks down or a child gets an injury, families can spiral downward quickly.”

Arkansas and Missouri voted to pass increases in minimum wage in the 2018 midterm elections. Boteach noted that the majority of Americans (75% according to a 2015 survey by Hart research) support raising the minimum wage.

To get raises, employees should leverage the tight labor market and move to better-paying jobs, the Bankrate.com survey suggested. Full-time employees are almost twice as likely to get pay raises and/or better-paying jobs than part-time workers. Older baby boomers (ages 64-72) had the highest incidence of reporting neither a pay raise or a better paying job, at 79%. Younger millennials (ages 18-27) were the most likely age group to get a promotion or new job responsibilities that resulted in a pay raise.

“Pay raises and landing a higher paying job continue to be the exception rather than the rule, even in a strong economy with low unemployment,” Greg McBride, chief financial analyst for Bankrate.com said. “Households seeking income growth are increasingly finding it ‘the old fashioned way — they earn it’ to quote an old TV commercial, usually by working more hours rather than being paid more per hour.”

 

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Trump Battles With Nancy Pelosi And Chuck Schumer Over Border Wall Funding

“I don’t think we should have a debate in front of the press on this,” House Minority Leader Pelosi said after several minutes of arguing.

In an explosive White House meeting on Tuesday, President Donald Trump, House Minority Leader Nancy Pelosi (D-Calif.) and Senate Minority Leader Chuck Schumer (D-N.Y.) sparred in front of reporters over Trump’s continued threat to shut down the government for border wall funding.

“I will be the one to shut it down,” Trump said. “I will take the mantle of shutting it down ... I am proud to shut down the government for border security, Chuck.”

“I don’t think we should have a debate in front of the press on this,” Pelosi said after several minutes of arguing with Trump in the Oval Office.

The president has regularly threatened to shut down the government over funding for his long-promised border wall, his signature campaign issue. The current round of government funding is set to expire on Dec. 21.

Trump wants to veto any congressional spending bill if he doesn’t get $5 billion for the wall, a demand that Democrats have rejected. Pelosi and Schumer want the president to accept a set of bipartisan proposals that would allocate about $1.3 billion toward border security measures, such as fencing.

If Congress does not reach a deal, a partial government shutdown looms, which would stop funding for some government agencies. Lawmakers had already passed a temporary extension before their original Dec. 7 deadline to give themselves more negotiating time. It’s possible that they may pass another temporary extension to keep the government open until the new year.

In addition to border wall funding, Trump also ranted on Tuesday about Republican electoral victories and talked over Pelosi during the meeting.

Underscoring the theatrics of the meeting, White House press secretary Sarah Huckabee Sanders said in a statement that “President Trump was grateful for the opportunity to let the press into the meeting.”

On Capitol Hill, several Republican and Democratic senators rejected Trump’s demand for a shutdown.

“I disagree with the president very much so on that issue. Government shutdowns are never valuable and should be avoided,” Sen. Susan Collins (R-Maine) told reporters.

“Nobody wins in a government shutdown,” Sen. Jeff Flake (R-Ariz.) said.

“No one should be proud of shutting down the government,” Sen. Dianne Feinstein (D-Calif.) said in response to Trump’s comments.

Some Democrats on Capitol Hill couldn’t help but spike the football after watching the nationally televised meeting at the White House.

“It’s a total disaster for Trump,” Sen. Chris Murphy (D-Conn.) said, speculating that Trump was simply throwing red meat to his political base. “Hopefully, Republicans can change his mind.”

Sen. Richard Blumenthal (D-Conn.), meanwhile, called Trump’s performance “a horror show.”

“It’s exactly the way we should not be governing,” he added.

Trump elaborated on his comments at a bill signing later Tuesday, and continued to threaten a shutdown.

“If we have to close down the country over border security, I actually like that,” he said. “Chuck’s problem is that when we last closed down, that was his idea, and honestly he got killed. So rather than us debating, I will take it. If we close down the country, I will take it.”

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