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State auditor fires professor who made controversial 'Obamacare' remarks

Posted November 20, 2014 5:29 p.m. EST
Updated November 20, 2014 6:13 p.m. EST

— State Auditor Beth Wood has terminated a contract with MIT economics professor Jonathan Gruber after the health care policy expert came under fire for controversial comments involving how the Affordable Care Act was passed in 2010. 

Gruber was among the policy experts who helped President Barack Obama and congressional Democrats build the health care law, which some people call "Obamacare." Although it's unclear that describing him as an "architect" of the law is accurate, it is clear he played some role in the measure's construction.

The same comments that have caused a firestorm among conservatives prompted Wood, a Democrat, to dismiss Gruber on Wednesday.

"We can’t use you on a project where you have a bias or where people might even think you have a bias," said Bill Holmes, a spokesman for Wood, who was traveling out of state on Thursday and was unavailable for comment.

The auditor's office will end up paying Gruber $100,000 for work that has already been completed.

Gruber declined via email Thursday to answer questions about the contract's termination. 

Comments cause a firestorm 

In October 2013, Gruber was among those speaking at a health care policy conference in Pennsylvania. He was addressing questions about why the health care law was constructed as it had been. In the run up to his most controversial remarks, he was speaking about why the law's tax penalties and financing were structured in what he called a "tortured" manner.  

"Lack of transparency is a huge political advantage. Call it the stupidity of the American voter or whatever, but basically, that was really, really critical to getting the thing to pass," Gruber said at the time. "I wish ... we could make it all transparent, but I'd rather have this law than not."

The comments sparked an outcry among opponents of the health care law, starting with radio talk show host Rush Limbaugh, who cited it as evidence that Obama and his party intentionally misled Americans about the law.

Obama and Democratic leaders, including U.S. Sen. Kay Hagan of North Carolina, have been criticized for repeatedly making claims that people who liked their insurance plans could keep them under the new law. That turned out not to be the case and was dubbed "The Lie of the Year" by Politifact in 2013. 

"All Americans should be incensed. President Obama, the Democrats, the White House – they all deliberately lied to the 'stupid' American people, and as Jonathan Gruber has made clear, they are quite proud of it," Republican National Committee Chairman Reince Priebus said in a column for the conservative TownHall.com website. 

Consultant has 'possible independence impairment'

Months before Gruber made his remarks, state lawmakers ordered the Office of the State Auditor to study the effectiveness of Community Care of North Carolina, which provides a "medical home" for many patients enrolled in the state's Medicaid health insurance program for the poor and disabled. The service works like a layer of managed care, ensuring patients make it to appointments, get their medicines and follow through on doctors' instructions. 

Lawmakers and Gov. Pat McCrory's Department of Health and Human Services have been working on various Medicaid reform plans, and a key question is how much money CCNC saves taxpayers and whether it should be included as a component of whatever new effort takes shape. 

In September 2013, the auditor's office consulted with the legislative leaders and discussed hiring Gruber, who had worked on the federal Affordable Care Act as well as Massachusetts' health care law. He was formally hired on Nov. 4, 2013, shortly after he made the controversial remarks, which went largely unnoticed at the time. 

During the intervening year, Gruber helped the auditor's office find and analyze DHHS data. 

"At least eight months of that was fighting with data," Holmes said. 

A timeline of Gruber's work released by the Office of the State Auditor says that an official there noted a week ago "negative media articles about comments made by Dr. Gruber." The decision to terminate Gruber's contract was made on Monday after the office determined "it cannot provide appropriate safeguards to eliminate appearance of an independence impairment."

The timeline says that Wood met with leaders in the Republican-controlled General Assembly on Tuesday to discuss the contract's termination and that she informed Gruber of the termination by phone on Wednesday. 

"Gruber’s comment that it was all right to mislead people to get to a desired outcome that he favored led our auditors to determine he had at least the appearance of an independence impairment," Holmes said.

In other words, even if Gruber performed his work up to standard, there would be questions as to whether he was favoring one side or the other based on his viewpoint. 

"I agree with Auditor Wood that Mr. Gruber’s inappropriate comments insulting the intelligence of American voters show he is not the right person to conduct business on behalf of our state," Senate President Pro Tem Phil Berger said Thursday evening. "I support her decision."

North Carolina is not the first state to cuts ties with Gruber. Vermont officials say they will no longer pay Gruber for work he is doing in that state, according to the Vermont Free Press.