Obamacare Math

I’m no mathematician, but I’ve come to some interesting conclusions from “running the numbers” on the Obamacare debacle.

First, about 14 million people are covered under the individual health insurance market.

Of those, in 2013, 13% were covered by grandfathered plans; or plans that could be renewed for 2014.  So that’s 1.82 million who for sure can “keep their plans;” at least for 2014.

That means as many as 87% of individual health plans could be cancelled.

We know for sure that as of last week (this is a week by week changing number) 4.8 million people have already gotten cancellation notices.  These are people who were covered this year, and if they want to continue to be covered, need to choose and purchase new insurance plans by January 1st.

The CBO estimated that 7 million people would be covered in the health insurance exchanges in 2014, but that was an estimate based on a fully functional Obamacare website.  I’ve no doubt that that the Obamacare site will eventually be fixed, but how long will that take?  I’m pretty comfortable guessing that the problems will not be fixed by the end of November, as promised by the administration.

The administration estimates that 200,000 people have signed up for coverage with the exchanges by mid-November.  That means as of right now, of the people who had coverage under the individual health insurance market this year, 4.6 million of them still don’t have coverage for 2014.   Although I’m sure that the number of enrolled people will steadily increase over the next few weeks, does anyone think that the remaining people who lost their coverage because of the Obamacare requirements will have coverage by the start of the New Year?

Even the Obama administration isn’t that optimistic.

That means that thanks to Obamacare, more people will start off the year without health insurance coverage than had it this year.  Congratulations President Obama!  You’ve successfully wrecked the nation’s health insurance market!   I think the administration should have applied the lessons learned from the Hypocratic Oath: First, do no harm.  Instead, the administration burned down the house, only to learn that their plans for the new house were incomplete.

If the percentage of uninsured in this country is greater this time next year than it is now, it will be pretty clear who will be responsible for it.  I hope someone is smart enough to remind people of that for the elections.

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Schadenfreude, and the Obamacare Timebomb

Considering the disaster of a rollout that Obamacare turned into, you would expect a lot more schadenfreude from the political right.  After all, it’s the President’s signature domestic policy.  For good or ill (and it’s mostly ill), this will be the domestic program that will be identified with President Obama.  And so far it’s a mess.  So why aren’t conservatives happy?  Part of it I think is that the right is still licking its wounds from the shutdown debacle.  They are still trying to heal a party that was pointless split for no good reason.  See?  I’m still trying to heal.  But the major part of this is that unlike a lot of wacky social programs that the left invents, screws up, and leaves to move on to the next big thing, healthcare is something that affects everyone.  The damage that Obamacare has done to the entire nation’s healthcare system, not just to the minority in the individual insurance market, is extensive, and much of it is permanent.  So there is no schadenfreude to be found in mocking the woman who said, “I was all for Obamacare until I found out I was paying for it.”

Fool, you’ve doomed us all.

If Obamacare had only ruined the healthcare system for those who supported it, then yes, the right would have the freedom to cackle with glee and point fingers, but eventually, this will affect everyone.

OK we’re still doing the finger pointing, but we’re not happy about it.

Right now the big Obamacare story is the website, which is a mess, but eventually the website will get fixed.  The problem goes far beyond the website.  The health insurance plans in the exchange depend on getting enough young health people to enroll to keep the cost of premiums down for the next year.  They need people paying but not using healthcare to afford the people who will enroll and will be sick and will be using healthcare; a lot.  That’s what insurance is all about after all.  If those young healthy people don’t show up and enroll, then you are left with more people taking out of the insurance pool than are putting into it.  That spells extremely high rates for premiums in 2015, or collapse of the exchange insurance groups.

And what could be pulling healthy young people from enrolling in an exchange insurance plan?  In a word; Medicaid.

So far (and admittedly this is a changing number) the majority of enrollees under the Obamacare exchanges are enrolling in Medicaid.  Under Obamacare the Medicaid expansion increased the Medicaid Eligibility to 138% of the Federal Poverty Line.  So all of those young healthy hipsters, particularly the ones who have extremely low incomes like students, are being enrolled, but they are being enrolled as Medicaid clients, not people in the actual private insurance groups.  So rather than contributing to the insurance pool, these healthy young people will basically be put on the dole, to drain the Treasury of funds to support healthcare that they could have otherwise been contributing to.

So if in the upcoming year we have insurance plans filled with the sick, while the healthy coast on Medicaid, than that’s a bomb that will blow Obamacare wide open.

Great plan geniuses.

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The “Don’t Fund it” Option

The latest, and perhaps last, opportunity to toss a few stop sticks in front of Obamacare is coming up with the upcoming 2014 spending bill.  The Tea Party coalition wants to strip Obamacare funding from the spending bill, giving the President the option of either vetoing the bill, and effectively shutting down the government October 1st, or signing the spending bill stripped of Obamacare funding; stopping it in its tracks.  It’s not repeal, but it’s a delay, and delaying Obamacare implementation I would think is worth taking some chances.  Obamacare is bad law and worse public policy, and if there is a clear path to even delaying this bill (hopefully for some future period in which there is a change in political leadership), then that path should be followed.  Of course there are two (at least) problems with this: the House leadership and establishment Republicans want nothing to do with this idea, and it’s not clear there is an effective path to getting Obamacare defunded.

Official portrait of United States Senator Mik...

Official portrait of United States Senator Mike Lee. (Photo credit: Wikipedia)

The “Don’t Fund it” option is a real organized effort.  It even has a website to track the progress and pledges of the various Republican Senators and Senate candidates. However, as usual, the establishment is opposed to doing anything that might make either Democrats or the Washington media mad at them.  This default bowing to possible media reaction means that they don’t want to take the chance of looking “obstructionist” in front of the national media.  Speaker Boehner is particularly uninterested in anything that would make the House Republicans look confrontational. So I cheer the Tea Party Republicans who are willing to take a risk at slowing down a bad law.

On the other hand…

The House Republicans have failed to impress in follow-through before. Last year’s fiscal cliff disaster was an eye opening view into how dysfunctional the House Republicans can be.  Before Christmas they voted against an option, what was then known as “Plan B” in order to finally agree and vote for a worse plan, as I chronicled last January.  These guys are not master strategists.  This isn’t House of Cards. It’s not even Pee Wee’s Playhouse. I’ve seen no evidence that there are wheels within wheels of planning and maneuvering to accomplish the goal of defunding Obamacare.  Both the debt ceiling fight and the fiscal cliff debacle demonstrated the amateur hour of the GOP and nothing they’ve done since last December has given me any confidence that they have learned from past mistakes and could prevail in this fight.

That’s not to say there aren’t options available to getting Obamacare defunded.  Some ideas include:

The Republicans could fund the government in multiple spending bills, isolating the Obamacare funding into a separate bill, and basically passing everything but that. Then it will be on the Democrats in the Senate to vote against the rest of the clean government funding.

They could just add an amendment to the bill holding off the implementation of Obamacare for one, two, or even three years. Since the exchanges and a lot of other moving parts aren’t ready, this might be tempting for some Senate Democrats. Obama basically did something similar by fiat.

The House Republicans could offer to fund Obama’s infrastructure and jobs bill with the funds that are not spent on Obamacare implementation.

These are just a couple of ideas that I thought of, off the top of my head.  I imagine a skilled parliamentarian would have a much longer, and perhaps more realistic list.  But in reality it seems unlikely that there is either a skilled parliamentarian or a list of options of any kind available. So I’m left to wonder,

-      Is there an actual strategy that has a possible favorable outcome?

-      Are there contingency plans depending on different possible White House or Senate Democrat responses?

-      Is there a united message and talking points for all participants to use in media contacts?

-      Has this scenario been “war-gamed?”

I wouldn’t be surprised if none of these issues had been seriously considered.  And that’s why, although I would love, love, love to throw my whole hearted support behind a “don’t fund it” plan, I would only want to do it if I thought there was at least a reasonable chance of success, rather than the Republicans ending up worse off than if they had just done nothing, and the media spinning the Republicans as both stupid and evil, like with the fiscal cliff.  And there is a possibility that the Republicans could end up worse off than if they hadn’t done anything.  If the President and Senate Democrats stand firm (and why wouldn’t they?), all the blame will be spun in the media as Republicans taking away Social Security from the elderly, paychecks from the military… you get the idea.  At that point the ball will be in the Democratic court, and they may have their own conditions to get government funded again.

Catching a few media interviews with Senator Mike Lee over the past week, I didn’t get any indication that there was a well thought of plan that has a reasonable chance of success.  Instead, it sounded more like a last gasp.

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Romney goes all in with Ryan

This was not the Vice Presidential pick I was expecting.  I was going along with the conventional wisdom on this one and assuming either Rob Portman or Tim Pawlenty.  Usually, you almost always can count on going wrong when relying on the conventional wisdom, but Mitt Romney seems like a conventional wisdom kind of guy, so the safe guesses seemed likely to me.  So I was surprised when I heard on the news that Paul Ryan was Romney’s VP pick.

In general terms, Ryan is a good pick.  He’s bright; in fact, bright enough that the average IQ of the House of Representatives will drop a good deal when he leaves. He can also present his arguments clearly and concisely.  One of my favorite all time political video clips is the Obamacare Health Summit, in which Ryan demolished the fiscal rationale behind the Obamacare CBO report in a few minutes, with a scowling Obama looking on.

Ryan was right on Obamacare, but it still passed.

And that’s the problem with the Ryan pick.  The President’s campaign strategy for this year has been to avoid economic issues and engage in personal attacks and demagoguery.  That’s the purpose of the various “war on…” ads.  2010’s “Throw Granny off a Cliff,” featuring a Ryan look alike rolling a wheelchair bound grandmother type off the edge of a cliff, is a harbinger of the type of campaign we can expect from the Obama administration.  When Democrats portray Republicans, they are usually shown as either stupid or evil, depending on what they think fits better.  With Ryan, it’s clearly going to be evil.  Will we see ads portraying Ryan as a blade welding, hockey mask wearing killer, slicing and dicing the elderly in rest homes?  Don’t laugh; after throwing granny off a cliff, will Ryan stop at nothing?

Ryan doesn’t really bring the key battleground States, like Portman (Ohio) or Rubio (Florida) would.  Romney is going for an ideological and ideas pick.  With Ryan, he’s showing that the thrust of his administration is going to be to get our fiscal house in order.  That’s a great thing and a vital one, but it plays into the Obama administration’s yearlong campaign strategy.  The White House is probably popping the corks on the bottles of champagne.  If you’re running a campaign based on demagoguery, you couldn’t have hoped for better than a Ryan pick.

Just like on Obamacare, Ryan is right on our budgetary and fiscal issues, but as Obamacare shows, being right doesn’t mean you will win the votes.

Looking at the race in the beginning of the year, I figured it would be Obama winning in a squeaker.  Months later, with the Ryan pick, I still lean that way.  But at least the battle grounds are clearly drawn, and we know what the race is about: saving our country from fiscal chaos and trying to restore the nation, or stripping the treasury of every dollar and eating our seed corn; eat, drink, and be merry, because tomorrow we may be a third rate, ruined power.  I think if the American people are given that clear choice, they’ll make the right decision.  The problem is, the few undecided voters will be viewing the race through the lens of the big three network nightly news programs, and they are all three firmly on Team Obama.

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Obamacare and its Successors

For those keeping score, once again, I was right and the so called experts were wrong.  The Supreme Court upheld Obamacare, 5-4.  The solid liberal block only had to peel off one of the Justices who actually read the constitution.  So the bad news?  Obamacare upheld.  The good news?  I was right once again!

Based on just a brief commentary I’ve heard so far on the decision, there is actually some other good news.  The court upheld the individual mandate based on the taxing power of the constitution, not the commerce clause.  So when it came to deciding if the commerce clause meant the government could do anything, they punted.  So rather than ignoring the constitution, they merely ignored the text of the law.  That’s a far better situation than if the court had decided to not recognize any limits to the commerce clause.  This is no Kelo.  This is a political decision that was only about this particular law.  It didn’t set a legal precedent.

But this doesn’t really change the playing field, at least not yet.  Even if the Court had repealed Obamacare in its entirety, we still would have been left with the situation of having to replace it with something.  This only pushes back the date to when we can do that; until we have a Republican President.  That makes a Romney win all the more important.  Politically, this might even be beneficial to Romney.  It would fire up a base who was otherwise rather “meh” on him.

So, assuming a Romney victory, what can we replace the shambling corpse of Obamacare with?  It’s not enough to get rid of Obamacare, declare victory, and go home.  The reason Obamacare had any traction in the first place was because there was a universal recognition that our healthcare system was broken.  It cost too much and didn’t cover enough people.  Even with Obamacare out of the way, the real issues that it was advertised to address remain.

Luckily there have been many alternatives proposed, and the pool of various reform plans is large enough to provide a good mix of alternatives to the slap dash political Frankenstein’s monster that was the Patient Protection and Affordable Care Act. The most obvious place to check with first is with the proposed healthcare plan of Mitt Romney.  Some of the major proposals of Romney’s plan include:

End tax discrimination against the individual purchase of insurance

Block grants to Medicaid.

Cap non-economic damages in medical malpractice lawsuits

Empower individuals and small businesses to form purchasing pools

Allow consumers to purchase insurance across state lines

Unshackle HSAs by allowing funds to be used for insurance premiums

Promote alternatives to “fee for service”

Encourage “Consumer Reports”-type ratings of alternative insurance plans

Most of these ideas are common features of other alternative health care reform proposals.  It shares similar features with the National Center for Policy Analysis proposal, the Heritage Foundation, the Competitive Enterprise Institute, the GOP, and the Options Act, a bill currently in committee in the House (as HR 4224).  All of these proposals are similar enough in their general outlines that one bill could probably be crafted out of them rather quickly.

One of the more interesting plans came not out of a think tank or campaign headquarters, but from a businessman, John Mackey, the CEO of Whole Foods.  His plan came out of his experience of trying to provide health care benefits to his employees.  Like the other proposals, Mackey supported equalizing the tax laws so that individual and employee health insurance plans had the same tax treatment, competition across state lines, and tort reform.  He also wanted to allow a check box on tax forms to allow a contribution to a fund to provide healthcare for people not otherwise covered, and expand the use of Health Savings Accounts, which are utilized extensively in the Whole Foods health care plan provided to their employees.

Naturally liberals were apoplectic that the CEO of the place where they purchased their overpriced arugula was proposing a counter proposal to the one Dear Leader was proposing.  The publication of Mackey’s article in the Wall Street Journal lead to a short lived lefty boycott of Whole Foods, at least until liberals decided they couldn’t find a more expensive place to purchase their organic veggies.

All of these proposals are all well and good in and of themselves, and would probably do a good job at “bending the cost curve” as the President inaccurately claimed Obamacare would do.  However they don’t do as much to reduce the number of people uninsured or dealing with people with pre-existing conditions.  Those are issues as important as bending the cost curve is.  That solution was John McCain’s healthcare proposal for the 2008 election.  McCain’s plan would have provided a tax credit for low & middle income people to be applied to their health insurance premium.  A good idea, except that he applied it to both individual and employee plans, boosting the cost of his program (although well below even friendly Obamacare estimates).

Recognizing the extra cost associated with Pre-existing conditions, McCain’s advisors were considering a proposal to have risk rated the tax credit so that people with pre-existing conditions would get a higher tax credit based on the rated expense of their particular condition.  He also supported State based risk pools, similar to the ones in Obamacare.

So looking at all of these plans together, shaking them up in a big healthcare reform bag and baking at 350°, this is what I’ve come up with as key features of a good alternative to Obamacare:

1)       Equalizing the tax treatment between individuals and businesses for health insurance premiums.  This would mean giving a first dollar deduction to individuals and families on their taxes plus for low and middle income people, a tax credit that would be applied to the health insurance premium.  McCain’s plan had a $5000.00 tax credit for family insurance premiums.  That would probably need to be updated and perhaps indexed to the growth in the cost of health care insurance premiums.

2)      I like the proposal to have a formula to increase the health insurance premium tax credit based on the severity of the pre-existing condition, but some pre-existing conditions are so severe that they are not insurable at any price.  For those, I go along with the state risk pools; not as a separate insurance plan, but as a secondary payer to the member’s regular primary insurance.  By applying and being accepted into a state pool, the member will be able to purchase regular insurance at regular prices and the diagnosis’s and procedures related to the members’ severe pre-existing condition the risk pool would pay as a secondary payer, similar to the way worker’s comp and auto accident insurance are handled.

These two main points handle the bulk of our current uninsured and pre-existing conditions crisis.  Of course I concur with the bulk of the other alternative reforms as well, such as Romney’s idea to allow purchasing pools for small businesses and other organizations.  I’m not clear as to why we would prohibit organizations like churches from organizing their own insurance purchasing pools.

There are many other options to Obamacare.  Options that are cheaper, more efficient, and would actually facilitate expanding healthcare, that are not top down statist solutions that guarantee to be more expensive and reduce consumer choice and little else.

Tags:  Politics, News, Obamacare, John Mackey, Whole Foods, Mitt Romney, Healthcare Reform, health insurance tax credit, pre-existing condtion,

Putting the Brakes on American Decline

I originally wrote and posted this a few years ago and have gone back and re-read it since, and it still holds up.  Our big national problems are basically the same, only worse, so I felt this was worth a repost; particularly since it required only a few updates.

Baring stunning breakthroughs in longevity, I should probably be dead in 50 years or so.  But I care what happens to this country after I’m dead, and would like it to continue to be a great power.  Not just a good one, or an “OK power” but a great one.  So I thought of a couple of ideas that I think would help to guarantee American dominance through the 21st Century and beyond.  Not by any means a complete list of course, but just a couple of ideas to get us started.

Getting our fiscal house in order

This should be a no brainer, but given that we are heading for a 16 trillion dollar budget deficit, it’s clear that we are a nation that wants far more government than we are willing to pay for.  How we got in this situation is easy to see:  Republicans are no fan of taxes, but have made little headway (none actually) in cutting spending.  Democrats have a limited ability to raise taxes because the country doesn’t like to pay them, but have an unlimited appetite for Federal spending.  Add both parties in power; simmer for a few decades, and presto!   Of course that doesn’t even count the unfunded liabilities of our Social Security. Medicaid, and Medicare promises, that we have no ability to pay, now, or in the future.  That’s about 61 trillion dollars and growing.

The GOP has already put a proposal on the table to at least get the conversation started on that.  The Ryan Plan would convert Medicaid to block grants to the States and modify Medicare into a premium support plan that is similar to Obamacare’s exchanges to purchase individual healthcare plans.  It’s a start at least and it does reverse the debt to GDP ratio that the current administration has us on.

Any debt plan that doesn’t address the escalating costs of Medicare, Medicaid isn’t really a debt plan, it’s a stalling plan.

Fixing this problem should be a national priority of the first order.  It’s not of course but it should be.  The next place to start is with a balanced budget amendment.  We (both the Congress and the American people) have proven that we are not mature or responsible enough to handle an allowance without adult supervision.  We need some rules and that would be best one.  Just like we self righteously tell someone in credit card debt to cut up their cards, we need to cut up our national one.

In addition we need to redo the way federal budget is handled.  Social Security has a trust fund in theory.  In practice we spent the surplus from that year after year, for decades and in return gave the Social Security Trust fund an IOU.  Of course the days of the Social Security surplus are now over.  From here on out, we’ll be cashing those chits, not collecting them. But that’s not even the only one.  The federal gas tax is supposed to go to a transportation trust to fix our roads and bridges; infrastructure in other words.  What happened to that money?  Same place as the Social Security money, into the general pork fund.  I’m not an accountant, but even I know that taxes that are being collected for dedicated purposes, like the gas tax and Social Security, shouldn’t be spent on anything other than what was intended.  They should be in off budget separate accounts.  Fix these fiscal problems and maybe a dollar will still be worth a dollar 50 years from now.

Tapping into the brain drain

We are a nation of dummies.  We’ve allowed the K-12 educational system in this country to fall apart and since we still don’t have a national consensus on what the problem is or how to fix it, I don’t expect that to be solved soon.  However our system of colleges and universities are still some of the best in the world.  As a consequence they attract the best and brightest from all over the world to come and study. Foreigners dominate our technical graduate and PhD programs. On the world market, a degree from a US University still means something.  So naturally, as soon as one of these foreign students graduates from a degree program with useful technical skills, what do we do?  We kick his or her ass out.

We do have a Visa program to allow people with technical skills to come to this country, but we limit it to 65,000 per year.  That’s a drop in the bucket compared to refugees, family “chain immigration” and other categories that allow people in this country.

And that’s not even counting the illegals.

What should we be doing?  We should gradually increase the number of H1-B technical skills visas and reduce the percentage of the some of the other categories of Visas.  We should also make it easier to allow foreign students to convert their student visa to an H1-B.   Since we can’t produce enough home grown professionals and technically trained people, let’s just import them.  If we are going to maintain our economic dominance in science and technology, we need engineers, IT professionals, and scientists of all types.  We are able to provide domestically all of the sociology and feminist studies graduates that this country will ever need.  Maybe we should export those.

Another useful visa type is the E-2 Visa, which allows foreigners to come to the US to live as long as they invest and start a new business in the US.  The requirements on this visa are tough.  Although a spouse can come over on this visa, children can’t.  Also, if the business fails, you can be deported even if you’ve lived in the country for years.  It’s astounding to me that so many in this country want to give amnesty to people who’ve entered the country illegally, but people who’ve followed the rules, worked hard and done everything we’ve asked we can’t wait to give the boot to.

Between these two Visa types, we can get almost all of the high quality immigrants this country needs. This country is still the number one destination for immigrants worldwide.  As long as that is the case, we should take advantage and get the cream of the crop.  Long term, they provide a bonus to our country by generating upper middle class wages and paying upper middle class taxes.  You want to reduce poverty in this country?  Stop importing so many poor people and start importing an educated, English speaking middle class.

Tax haven to the world

With New York losing its battle with London as the financial capital of the world, we should be concerned that capital is finding other places more attractive than the United States.  We are losing to a European country?  There are a variety of reasons, the financial crisis, Sarbanes Oxley, and even Eliot Spitzer gets some blame for chasing away companies from New York.

And of course there is the tax treatment.  US corporate taxes are among the highest in the developed world.  Although personal income taxes in most of Europe are far above the US level, we make it up by kicking in the crotch the companies that provide jobs and economic growth.   I’ve always found it interesting that “socialist” Europeans want their businesses to succeed worldwide, while in the “capitalist” United States we hate and incessantly attack our most successful companies.  We attempted to break up Microsoft and investigated them for years for anti-trust violations; one of the most successful US companies of the 90’s.  One of the other successful companies, Wal-Mart, is on the liberal ‘sue’ list. You don’t see Finland attacking Nokia for having too large a market share of the cell phone market.

We need to redo our regulatory and tax structure to encourage capital to come to the US to invest, not chase it away.  There are several options to do this, such as the fair tax, or a flat tax.  We should have as a goal to reduce and gradually eliminate the capital gains tax.  Basically, whatever rules and regulations that successful tax havens have, we need to emulate them so people worldwide will want to put their money here.

These are just a couple of ideas and I’m sure other people have their own wish lists for what they would like to see and this is by no means a complete list.  But we need to start recognizing that the US continuing as a superpower isn’t inevitable, or even particularly likely.  It will take much effort and work to continue that status.

Obamacare on Trial

I realize that at this moment in time, far more people are concerned about Trayvon Martin’s tweets or George Zimmerman’s facial injuries, but this week there was something far more important happening, with much longer lasting consequences

The United States Supreme Court, the highest c...

The United States Supreme Court, the highest court in the United States, in 2010. Top row (left to right): Associate Justice Sonia Sotomayor, Associate Justice Stephen G. Breyer, Associate Justice Samuel A. Alito, and Associate Justice Elena Kagan. Bottom row (left to right): Associate Justice Clarence Thomas, Associate Justice Antonin Scalia, Chief Justice John G. Roberts, Associate Justice Anthony Kennedy, and Associate Justice Ruth Bader Ginsburg. (Photo credit: Wikipedia)

than anything that happens in Sanford’s Bonfire of the Vanities.  I’m talking about the oral arguments for the Patient Protection and Affordable Care Act, or as it’s more commonly known; Obamacare.

Not since the second Militia Act of 1792 has the Congress ordered citizens to purchase something.  In that case, it was a musket and accessories.  But that was under the President’s article 2 powers, not the commerce clause, so the Obamacare mandate to purchase health insurance is something brand new.  Unless you’re simply a statist who regards the State as superior to everything else in society, including the constitution, that’s a tough sell.  And Solicitor General Donald Verrilli showed that before the Supreme Court on Tuesday.

Verrilli has taken a lot of heat for his nervous stumbling and bumbling before the court, but I’m not sure if he had been composed, calm, and collected it would have made a difference.  He just didn’t have good arguments.  Particularly for questions that he must have known that he would be asked, as when Justice Kennedy asked about the limits of the commerce clause.  I don’t think even Joe Pesci from My Cousin Vinny could have saved this case.

I was particularly struck by the news coverage this week that the pundits, talking heads, and reporters simply accepted as a given that the four liberal judges would vote to uphold the law, no questions asked.  The debate seemed to roll around the idea that Justice Kennedy, the swing vote, could be persuaded to come down on the side of the law.  There was even some speculation that Chief Justice Roberts might put aside “politics” to vote to uphold.

Since of course to vote the law down is political, but to uphold the law would just be good jurisprudence!

But for the liberal judges there isn’t that sort of pressure.  No one is asking the liberal justices to “put aside politics.”  One of the benefits of being a liberal judge who believes in a living, breathing, constantly evolving constitution is that you don’t have to worry about the actual text of the constitution, or the intent of the founders.  A living constitution means never having to say you’re sorry.  Or, to put it another way, if the law feels good, do it.

Leave the cracking of books to the strict constructionist eggheads.

If the individual mandate goes down, it would be with a bit of irony, since President Obama originally opposed the mandate during the 2008 campaign, using some of the same arguments against Hillary that the President’s opponents are now using against him.

He should have stuck with his first instinct.

We’re not going to find out how this all plays out until later this summer when the court releases its decision even though the Justices likely voted on this issue today.  But I’m not afraid to go ahead and handicap the decision now.  My gut feeling is that the odds are better than even that the court will uphold the mandate.  I base that on the fact that the mandate has 4 automatic votes for.  So that means that only one vote is needed to be swayed among the other five Justices who actually have to study this case (unlike Ginsberg and Breyer, who will be windsurfing instead of reading law books).

But if the mandate is overturned, I think it’s likely that most of the law will stand intact.  I figure the Justices will just throw this mess back to Congress to fix the creaking boat of Obamacare with a mandate sized hole in the bottom of it. The Congress, divided as it is, will be able to accomplish nothing.  At least until next year.  And what then happens to health reform will largely depend on which party does well in November.

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Lies, Damn Lies, and Healthcare Lies

As ironclad and inevitable as my logic seems to me when sealing the deal on an argument, I often find I have critics.  In this case, I’ve been accused of “lying” about some of the arguments I’ve made, particularly in my blogs about the Public Option and Rationing.  But, because I’m so fair minded I am more than happy to answer my critics and confront the accusation of lies.  To me the accusation of lying breaks down immediately and it seems like the “lies” are really just disagreements of opinion, not a conflict over the facts, although sometimes that comes up too:  In this case, my argument was the problem, not the facts:

the argument that we don’t want to be like Canada or Britain..
Because it’s the classic lie coming from the GOP…

what, is the lie?

That we will suffer the same consequences of these systems.. even tho this is NOT the system the Dems are trying to pass..

 

Well I would think that we can all agree that we don’t want to have the type of system that they have in the UK, but Canada has been held up as the gold standard of government healthcare by the American left for years.  But the problems that Canada has now were not evident immediately after they switched to their current system; it took years to outgrow the infrastructure that they had to reach the current position of having too few medical facilities and too few providers, resulting in long wait and appointment times.  We have the current medical infrastructure that we have, hospitals, urgent cares, outpatient surgery centers, even walk in clinics in Wal-Mart, because there is money in it.  Take the financial incentive out of the system and you are stuck with the infrastructure you have.

The system the Democrats want to pass is one in which the germ of a government public option is available to eventually swamp over the current private insurance system.  The long term goal and result is to eliminate private health insurance, as The President and Democrats have been saying for years.  That would give us a system very much like Canada’s, with all that comes with it; shortages, long lines, months long wait for specialists and surgeries… no lie there.

Phrasing.. seriously.. I had to read it twice.. the placement of the word ‘uninsured’ makes it almost seem like you mean one those kinds of ppl getting breast or protate or any other cancer has a better survival rate here than anywhere else.. .. but thats simply not true is it.. because the survival rate you are quoting is only for those with insurance… those without of course, fare much worse than any other country don’t they..

 

I suspected that this wasn’t a valid issue to begin with, since counting only covered people would make the data fairly useless in determining actual survival rates worldwide.  That might be an interesting study in its own right, but there was nothing I could find in this study, regarding long term survival rates for cancer, that limited the pool to only covered people in the United States.  But I wanted to be sure so I went back to the original study, published in The Lancet Oncology, to review the methodology that was used in the study, and, as I suspected, health insurance coverage was not mentioned.  For an international study, that might not have even been a consideration when developing the data points for producing the study.  The NCPA’s analysis of the same study said that, “These figures reflect the care available to all Americans, not just those with private health coverage.”

Another “lie” seemed to be an interpretation of President Obama’s ABC Townhall on health care.  President Obama, in response to a question, said:

But what we can do is make sure that at least some of the waste that exists in the system that’s not making anybody’s mom better, that is loading up on additional tests or additional drugs that the evidence shows is not necessarily going to improve care, that at least we can let doctors know and your mom know that, you know what? Maybe this isn’t going to help.  Maybe you’re better off not having the surgery, but taking the painkiller.

To me, this sounds like an implicit support for rationing care to the elderly.   Of course we should eliminate waste in the system, but the President could do that now, without having a healthcare bill.  Medicare is losing 60 billion a year to waste, fraud, and abuse.  That is a worthwhile target to go after regardless of what happens to health reform.  It shouldn’t be held hostage to health reform.  In any case, there is nothing in the current HR 3200 that would attack this massive problem.  Instead, they use the example of trading off care.

But President Obama, has made it clear, at least until the past few months, that he very much sees rationing as a method for cutting costs.  As recently as April in an interview with the New York Times Magazine, President Obama brought up the now infamous red and blue pill analogy:

So when Peter Orszag and I talk about the importance of using comparative-effectiveness studies as a way of reining in costs, that’s not an attempt to micromanage the doctor-patient relationship. It is an attempt to say to patients, you know what, we’ve looked at some objective studies out here, people who know about this stuff, concluding that the blue pill, which costs half as much as the red pill, is just as effective, and you might want to go ahead and get the blue one. And if a provider is pushing the red one on you, then you should at least ask some important questions.

 

That’s fine as far as it goes, everyone, from insurance companies on down, would prefer that you use generics if there are no specific medical reasons to use the “retail” pill.   But the President, who famously said last week that he did not want to kill our grandparents, seemed to have mixed feelings on his own:

I mean, I’ve told this story, maybe not publicly, but when my grandmother got very ill during the campaign, she got cancer; it was determined to be terminal. And about two or three weeks after her diagnosis she fell, broke her hip. It was determined that she might have had a mild stroke, which is what had precipitated the fall.

So now she’s in the hospital, and the doctor says, Look, you’ve got about — maybe you have three months, maybe you have six months, maybe you have nine months to live. Because of the weakness of your heart, if you have an operation on your hip there are certain risks that — you know, your heart can’t take it. On the other hand, if you just sit there with your hip like this, you’re just going to waste away and your quality of life will be terrible.

And she elected to get the hip replacement and was fine for about two weeks after the hip replacement, and then suddenly just — you know, things fell apart.

I don’t know how much that hip replacement cost. I would have paid out of pocket for that hip replacement just because she’s my grandmother. Whether, sort of in the aggregate, society making those decisions to give my grandmother, or everybody else’s aging grandparents or parents, a hip replacement when they’re terminally ill is a sustainable model, is a very difficult question.

Yes that is a difficult question.  And that’s exactly what is bringing the oldsters out to townhalls.  They are afraid, and not because of Glenn Beck or Rush Limbaugh or whatever boogie man lefties have, it’s because of the President himself.  The great communicator, if he is not in favor of rationed healthcare, sure likes to bring it up a lot.

I think my favorite “lie” is this one:

take for instance the argument of “It costs too much”.. well it costs more to do nothing.. But this truth is flatly rejected because there is no arguing it.. so it goes on the shelf labeled “Ignore at all costs”

I’m not sure how exactly this is categorized as a lie, but it’s a strawman argument.  There is no advocacy for “doing nothing.”  Neither Republicans, “villain” insurance companies, nor blue dog Democrats are arguing that it’s Obamacare or nothing.  There are multiple proposals for reform, and I’ve made a few myself for years.  But  arguing that Obamacare is actually going to cut costs is ridiculous.  The CBO is not buying it, and there doesn’t seem to be any evidence, other than President Obama’s say so, that his plan would cut costs, either in the short or long term.  It’s a money pit.  I wonder how in the tank to Obama you have to be to think that creating a major new entitlement program will reduce costs.

Anyway, I’m always open to respond to more “lies.”  Maybe someday I will actually get some.

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Of Course it’s Rationing

During the August recess, while the Community Organizer in Chief is leading the charge against communities organizing against his health care agenda, I thought I would take another look at the details, which the devil is notorious for being in.  To me, the clearest long term effect is that the health care reform will end up in health care rationing.  Not as an unintended side effect, but as the long term goal.

But no, you say, scare-monger!  Trying to frighten people from the vision of The One!  Well, maybe people should be scared.  It’s astounding to me that this plan has gotten this far.  True, the plan would have been passed months ago if Obama had been savvy enough to drop it already written onto the laps of Congress in early February.  The country was in the throes of an Obamagasm and the President figured it would last enough to get this done in the summer.  It’s easy to see how he miscalculated.  All the major media organizations are still lounging in the bed, nude, and bathing in the afterglow. But much of the country either never got their promised release, or did, and afterwards felt sticky and thirsty, with a pounding headache coming on.

It’s a simple economic truth that in the broadest sense everything is “rationed.”  That’s what money does; it determines a value for anything that there isn’t an infinite supply of, which is practically everything.  Health care in the United States costs money, so if you have a lot of money, you can get as much as you want, or like most people who don’t have a lot of money, you have a third party payer pick up the tab.  In Canada and Europe, healthcare still costs money; only the someone who is picking up the tab is the government.  In the US, the third party payers (insurance companies) compete against each other for member’s and employer contracts.  In systems where the government is the only purchaser of healthcare, there isn’t competition, or making a profit off of providing healthcare like there is in this country, only a staggering cost and annoying patients.  Wait times often do the rationing, with patients waiting many months for care in limited facilities with limited medical providers.  That’s one of the key differences between a private and government health care system.  Building more facilities and hiring more staff helps to make money in a private system, so there is a powerful incentive to expand, but for the government, it’s merely a drain on resources.

The country had a bit of luck though in that President Obama’s first choice for Health and Human Services Secretary, Tom Daschle, was derailed by tax issues.  Daschle, who had spent the years since losing his senate seat mucking about Washington as a lobbyist-who-never-registered-as-a-lobbyist also had time to write a book on health care, Critical:  What We Can Do About the Health Care Crisis.  The book lays out a plan very similar to what’s contained in HR 3200.  Daschle was quite open in how he wanted health care to be rationed; he proposed a Federal Health Board  to determine both clinical effectiveness and cost effectiveness, in other words, a board to determine approved courses of treatment in the same way that the Orwellian named NICE, the National Institute for Health and Clinical Excellence, does in the UK.

NICE determines cost effectiveness based on a formula that says that a treatment is cost effective if it doesn’t exceed $34,000 per Quality Adjusted Life Year.  That means if an anti-cancer drug costs a cool 34K, but it will only increase your life span for 6 months, then sorry, go home and die.  This insures that only the older, cheaper, treatments will be used with any regularity.  That’s why the United States, with millions uninsured, has better long term survival rates on most common cancers, like breast, prostate, and colon cancer than the state supplied healthcare of Europe.

Daschle isn’t the only one in the President’s orbit who wants to ration health care.  Dr.  Ezekiel Emanuel, brother of Chief of Staff Rahm Emanuel, is a White House advisor on health care issues and has written extensively on various aspects rationing health.  His take on rationing healthcare is based on his Complete Lives System.   As Dr. Emanuel explains his proposal:

When implemented, the complete lives system produces a priority curve on which individuals aged between roughly 15 and 40 years get the most chance, whereas the youngest and oldest people get chances that are attenuated.

There is even a chart showing prime ages for using expensive medical treatment, and ages when…eh not so much eh?

The gist of this proposal is that if you are between 15 and 40, you are considered a good bet to get high quality, expensive medical treatment, because these are the ages when you have the most value to society.  Under 15, not so much education or training has been spent on you, so there is no big investment.  Over 40, you are beginning the end of your highest value to society and now you are starting to cause nothing but problems, what with your middle aged health ailments. Oy!  As you can see from the chart if you are 60 or older, than it’s pretty much Soylent Green time.  Just go to the center, take your poison, watch an IMAX movie and “go home.”

Rationing is so ubiquitous among the supporters of government healthcare that there doesn’t seem to be any shyness in discussing it.  Apparently you can advocate health care rationing, just not use the word “ration” and that’s good enough.  For example, Senator Edward Kennedy wrote recently for Newsweek about The Cause of My Life:

We also need to move from a system that rewards doctors for the sheer volume of tests and treatments they prescribe to one that rewards quality and positive outcomes. For example, in Medicare today, 18 percent of patients discharged from a hospital are readmitted within 30 days—at a cost of more than $15 billion in 2005. Most of these readmissions are unnecessary, but we don’t reward hospitals and doctors for preventing them. By changing that, we’ll save billions of dollars while improving the quality of care for patients.

The problem with re-admissions of course, is that you can’t know they are un-necessary until after the patients are re-admitted.  How are you going to know which re-admissions are “unnecessary” until after they are re-admitted?  How is the government going to reward hospitals and doctors for not admitting patients to the hospital?

And of course, this goes all the way to the top, to the Rationer in Chief.  During the ABC Health Care Town Hall, President Obama made an astounding statement regarding that very subject, in response to a question from a woman who is a caregiver to her 105 year old mother, the woman told of her attempt to find a doctor to implant a pacemaker.  She finally found a doctor who found her mother to be worth saving, and the surgery was done.  Her question, would the government plan consider “a certain joy of living?” In determining who would get expensive medical care.

But what we can do is make sure that at least some of the waste that exists in the system that’s not making anybody’s mom better, that is loading up on additional tests or additional drugs that the evidence shows is not necessarily going to improve care, that at least we can let doctors know and your mom know that, you know what? Maybe this isn’t going to help. Maybe you’re better off not having the surgery, but taking the painkiller.

I don’t know why the President seems to think that doctors don’t already have to make those decisions, based on the health and ability of the patient to handle surgery.  Now of course, there will be a new wrinkle added, the government’s desire to pay for healthcare for the unproductive.

Rationing isn’t a joke or an over the top accusation.  It’s happening right now in other countries, and astoundingly there seems to be plenty of people who want to import the worst of socialized medicine to this country.  My wife’s grandmother is British, and at 92 has been denied the gall bladder surgery that she needs by the NICE regulations.  In this country, a 92 year old may or may not get surgery, based on the physician’s judgment that the patient is able to handle the surgery, not on government regulations and rules.

A British friend of my wife’s family, in his late 50’s was diagnosed a few months ago as needing bypass surgery and a shunt.  He has a home in Florida as well as in the UK, and wanted to fly back to the States for surgery, since he was told that he couldn’t be scheduled for surgery for months. However the National Health Service has forbidden him to fly.   In this country, go see a doctor and be told that you need open heart surgery and chances are you’ll find yourself admitted to a hospital the same day. So he is trapped in the UK, hoping he lives long enough for the scheduled surgery (hopefully by the end of August).

So this is how the government plans to “control costs.”    True, the United States spends more per capita on health care than any other nation, but that’s because, goddamn it, we want health care, and we’re buying it.  In other countries, healthcare is a line item in the national budget.  You can’t buy more of it if you want or need more.  You get what you’re allowed to have.  Why anyone would want to copy that kind of system is beyond me, but what I do understand is why the government wants it.  That’s in the nature of governments to constantly try to expand it’s power over us, and it has plenty of collaborators.

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Public Option? -> Only Option

It’s difficult to figure out amidst all of the swirling mess that makes up “health care reform” just what exactly is getting reformed.  President Obama learned the lesson of the Hillarycare debacle and has been pretty cagey on specifics, even when he is expecting to sign a bill on it by the end of the summer.  Of course, Hillarycare was a full blown plan that could be analyzed and picked apart.  Obama is not interested in having the same result so the few real details that have been leaked have been rather limited.  Of course, with this Congress, who needs details?  They’re more than willing to vote for a bill unread and fresh off the presses.  After all, as Congressperson Malibu Stacy might say, “Thinking too much gives you wrinkles.”

But one thing is clear, if it’s going to be reform in any way that Obama and the far left of the Democratic Party care about, it’s got to have the “Public Option.”  Right now the administration is having it both ways.  On the one hand it’s saying that it has no intention of driving private insurers out of business, but on the other hand, reassuring Congressional Democrats that the President is still committed to having a public option as part of his vision of health care reform.

Why the Public Option?  The formal answer was included in Obama’s letter to Senators Kennedy and Baucus:

“I strongly believe that Americans should have the choice of a public health insurance option operating alongside private plans. This will give them a better range of choices, make the health care market more competitive, and keep insurance companies honest.”

Competition?  There are approximately 1300 health insurance providers in the US.  Really, will 1301 really make the difference and suddenly lead to “a better range of choices, make the health care market more competitive, and keep insurance companies honest?”  That’s all it would take, just one more provider?  The idea is so ridiculous that you would have to be a White House journalist to buy it.

What makes the public option the crown jewel of any health care reform plan?  It’s the camel’s nose under the tent for single payer government healthcare.  No, this isn’t just Republican scare-mongering.  I can hardly imagine any other conclusion for the insistence on a government healthcare plan.  And it’s easy to see how it would happen.  The logic is this:  One of the keys of health care reform is an individual mandate, but you can’t very well have one if people cannot afford to buy health insurance, so you have to provide an option for people too poor to pay.  Enter the public option.  An analysis of several public option scenarios shows that premiums could be 30 to 40 percent less than comparable private plans.  That of course hinges on the government paying reimbursement rates comparable to Medicare, which are 70-80 percent of what private insurers pay.

So one of the ways the Obama plan controls costs is just by paying the doctors and hospitals less.  I’m sure that will make a great incentive for people to go into the medical field.  And who wouldn’t want to be taxed to subsidize their competitor?

But that’s not the fiscal time bomb.  First, the same analysis shows that depending on the premium rate for the public option, 119 million people could lose their private health insurance.  Some of course, would voluntarily flee.  If the public plan has lower premiums, what do they care what rate their doctor gets paid at?  Others would find themselves dumped.  Why would companies want the expense of maintaining their own health insurance coverage when a public plan can offer lower premiums?  Private plans of course have to have doctors and facilities join their networks voluntarily. Not an issue for the government.

Another issue is that the Obama administration, in order to help finance their reform schemes, wants to make it more difficult for employers and employees to pay for health care benefits.  One plan is to tax the employee health care benefits by capping the employee health care exclusion.  That excludes company health care benefits from an employee’s taxable income.  Another actually violates one of Obama’s campaign promises, not to tax health care benefits.  Obama criticized John McCain’s plan to tax employer health care benefits during the campaign, but at least McCain was going to transfer the tax benefit to individuals to enable them to purchase health insurance with a tax credit.  Obama is just keeping the money for the federal trough.

Driving Private health insurance out of the market has happened before.  TennCare was supposed to be Tennessee’s version of “the public option.”  The goal was to reduce health care costs by covering a larger group of lower income people than were normally covered by Medicaid guidelines.  Many features of TennCare mirrored some of the Obama health reform proposals.  The few remaining insurance companies have dumped their most expensive members onto the public plan, and the cost has far exceeded projections.  Closed hospitals, doctors fleeing the state, uncontrolled spiraling cost… that’s our future.

It’s fairly easy to see how this will play out if we get the public option.  First it will cover a few of the lower middle class, and then the taxes on both employers and employees will push some companies that are in marginal fiscal health (a rather large number since we are in a recession) to drop their plans.  Eventually, it will make no sense to provide a health insurance benefit when it no longer provides any tax benefit to the company or to the employee.  As the companies in Tennessee discovered, it was easier and less hassle to pay the extra penalty tax for not providing health insurance to it’s employees.  Eventually, a health insurance benefit will be as uncommon for the average American worker as a defined benefit pension plan now is.  The government will end up with the healthcare costs of most of the American workforce.

At that point, the rationing will begin, but that’s another story.

What I can’t figure out, is why the government would want to take up an open ended financial liability that it does not currently have, to provide a service that is currently being provided by the free market, and in doing so destroy large segments of the economy that is now providing that service?  Anyone?   Bueller?  If there is a better reason than just runaway statism that wants to make dependent charges of its citizens, I would love to hear it.

Now does President Obama know what he’s doing, or does he sincerely not see how his plans would destroy the private insurance market?  He gave a little clue during his June press conference on health care.  When asked by ABC’s Jake Tapper how he could guarantee that cheaper public plans wouldn’t drive out employer funded private care.

“When I say if you have your plan and you like it,…or you have a doctor and you like your doctor, that you don’t have to change plans, what I’m saying is the government is not going to make you change plans under health reform…”

That’s a change from earlier comments on the same issue:

“If you like your doctor, you will be able to keep your doctor, period. If you like your health care plan, you’ll be able to keep your health care plan, period. No one will take it away, no matter what.”

OK now I guess you can lose your health plan.  Period.

At that point, I wouldn’t have been surprised if President Obama had turned to the camera and winked.

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