Even by government standards, it’s an outlandish story of wealth and hypocrisy: A bureaucrat who made more than $1 million selling Obamacare insurance plans, but won’t buy one for himself? The sad thing is, it also happens to be true.
Meet Peter Lee, executive director of Covered California. In the past three years alone, Lee has made well over $1 million running California’s Obamacare exchange. He received massive raises in the past two years, going from a salary of $262,644 in 2014 to $420,000 beginning this July.
On top of that nearly $160,000 raise, Lee received two other whopping bonuses of $52,258 in 2014 and $65,000 in 2015—winning more in one lump sum than many families make in an entire year. But at a September briefing, I asked Lee point-blank what type of health coverage he holds. He said he was enrolled in California’s state employee plan.
Think about that: a bureaucrat whose salary comes from selling exchange plans—Covered California’s operating budget derives from surcharges on plans sold through the exchange—but yet won’t buy one of the plans he sells for himself. It’s enough to make a person ask how much Lee would have to make before he would actually break down and buy one of the plans he sells—a million dollars? Two million? Five million?
Liberal One-Percenters: Good for You, Not For Me
I’ll concede right now that Obamacare’s exchanges were designed primarily for those without employer coverage. Individuals whose employers do offer “affordable” coverage cannot receive subsidies on the exchanges, although they can enroll without a subsidy, if they so choose.
Most Americans choose employer coverage, because firms heavily subsidize them—to the tune of an average of $12,865 for family coverage. For the average worker making $60,000, or even $80,000, per year, turning down the employer subsidy to purchase an unsubsidized exchange plan represents a substantial pay cut, one many families could not afford.
But well-paid liberals like Lee—who over the last two years received raises more than 12 times the average employer’s subsidy for health coverage—have no real financial excuse not to join the exchanges—other than liberal elitism. As the owner of a new small business who likely won’t make six figures this year, I have little patience to hear supposed believers in Obamacare with far more means than I who won’t give up a few thousand dollars in employer subsidies to enroll on the exchanges themselves. After all, aren’t liberals the ones who believe in social solidarity and “paying your fair share”?
Well-Heeled Bureaucrats and Think Tankers’ Hypocrisy
For instance, Centers for Medicare and Medicaid Services (CMS) Acting Administrator Andy Slavitt literally cashed in to the tune of over $4.8 million in stock options on joining the Obama administration, more than enough to forego any employer subsidy for his health coverage. He recently responded to a questioner on Twitter asking him why he wasn’t on Medicare by stating that he was only 49 years of age—too young to qualify. Within minutes, I sent Slavitt a follow-up tweet: “If Obamacare is so great, are you on the Exchange—and if not, why not?” Slavitt has yet to reply.
Both Slavitt and Health and Human Services Secretary Sylvia Burwell (net worth: $4.6 million) have plenty of financial resources to forego an employer subsidy and purchase exchange coverage. Even at a total premium of $15,000 for his family, one year’s insurance costs would total less than 0.3 percent of the stock gains Slavitt cashed in on when joining the administration—to say nothing of the millions he likely will make when he “cashes in” on his government experience in just a few months.
Did Slavitt just not see my tweet asking him about his health coverage? Did he not reply because the person in charge of selling exchange policies doesn’t think they’re good enough to buy for himself? Or does he believe that someone who made millions a few short years ago is too “poor” to give up a few thousand dollars in employer subsidies for his health care?
The ranks of well-paid liberals clamming up when asked about their health benefits extends beyond government into the think-tank ranks. In September, the Urban Institute published a paper claiming that exchange coverage was actually cheaper than the average employer plan. I e-mailed the papers’ authors, asking them a simple question: Had they taken steps to enroll in exchange coverage themselves, and encouraged the Urban Institute to send all its employees to the exchanges?
I have yet to receive a reply from the three researchers. But after doing some digging, I found the Urban Institute’s Form 990 filing with the Internal Revenue Service. The form reveals that one of the study’s authors, John Holahan, received a total of $313,932 in compensation in 2014—$267,051 in salary, and $46,881 in other compensation and benefits.
Does Holahan therefore believe that giving up his subsidized benefits and relying “only” upon his $267,051 salary presents too great a sacrifice for him to bear financially? If he and his colleagues truly believe exchange plans are more efficient than employer coverage—as opposed to just coming up with a talking point to rebut Obamacare’s massive premium increases—then shouldn’t they enroll themselves?
I Make $400,000, So Quit Whining about Your Cost Hike
Then there’s Larry Levitt, a senior vice president at the Kaiser Family Foundation. Last week Levitt tweeted that exchange premium increases don’t apply to many people—a talking point that Drew Altman, Kaiser’s CEO, has also made in blog posts. I replied asking whether Levitt himself, or other people using this talking point, actually have exchange coverage, to which Levitt gave no response.
Care to guess how much these scholars claiming exchange premium increases are overrated make themselves? According to Kaiser’s IRS filing, Levitt received $333,048 in salary and $48,563 in benefits in 2014. His boss, Altman, pulled down a whopping $642,927 in salary, $149,509 in retirement plan contributions, and a $13,545 expense account—nearly $806,000 in total compensation.
The contradictions from the Kaiser researchers are ironic on two levels. One could certainly argue that an executive making nearly $400,000, let alone more than $800,000, doesn’t need comprehensive health insurance, except to protect from severe emergencies, like getting hit by the proverbial bus. However, both appear loath to give up their employer-provided health coverage, and equally quick to minimize the impact of Obamacare’s premium increases nationwide. As I noted on Twitter, that’s easy for people who refuse to join the exchanges to say.
Last, but certainly not least, on the hit parade is Massachusetts Institute of Technology professor Jonathan “Stupidity of the American Voter” Gruber. Last week, Gruber said Obamacare “was working as designed” and that people who lost their coverage thanks to the law “never had real insurance to begin with.”
Unfortunately, MIT’s tax filings don’t include his salary. However, given that Gruber’s infamous undisclosed contract with the Obama administration totaled nearly $400,000, and that he literally made millions from other contracts, it’s fair to say Gruber could afford to purchase his own health insurance outside his employer—if he wanted to. So I e-mailed and asked him whether he gave up his employer coverage to purchase the “real insurance” Obamacare provides. Wouldn’t you know, I have yet to receive a reply.
It’s bad enough that the individuals above apparently refuse to give up their platinum-plated health plans to join the exchanges, even though it would cost them at most a few percentage points of their total compensation to do so. They also wish to cast stones from their ivory towers at those of us who are facing higher premiums, rising deductibles, fewer (if any) choices of insurers, and smaller doctor networks thanks to the law they claim to support.
So to all those well-heeled Obamacare supporters who can afford to enroll in Obamacare themselves, but simply won’t, I’ll make one final point: Disagree with me if you like, but I’m working my damnedest to stop Obamacare’s bailouts—even though I know that if I “win” on the policy, I could lose my health coverage. It’s called standing on principle. It’s a novel concept. You might want to try it sometime.