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eridani

Profile Information

Gender: Female
Hometown: Washington state
Home country: USA
Current location: Directly above the center of the earth
Member since: Sat Aug 16, 2003, 01:52 AM
Number of posts: 51,905

About Me

Major policy wonk interests: health care, Social Security/Medicare/Medicaid, election integrity

Journal Archives

A positive way to fight end of year deficit hysteria

What budget plan actually saves lifeline programs while reducing the deficit? The Congressional Progressive Caucus Budget of course! Demand that your representatives and candidates running in your district to take a stand on it. No cuts for Medicare, Medicaid or Social Security!

http://cpc.grijalva.house.gov/index.cfm?sectionid=70

The People’s Budget eliminates the deficit in 10 years, puts Americans back to work and restores our economic competitiveness. The People’s Budget recognizes that in order to compete, our nation needs every American to be productive, and in order to be productive we need to raise our skills to meet modern needs.

Our Budget Eliminates the Deficit and Raises a $31 Billion Surplus In Ten Years
Our budget protects Social Security, Medicare and Medicaid and responsibly eliminates the deficit by targeting its main drivers: the Bush Tax Cuts, the wars overseas, and the causes and effects of the recent recession.

Our Budget Puts America Back to Work & Restores America’s Competitiveness
• Trains teachers and restores schools; rebuilds roads and bridges and ensures that users help pay for them
• Invests in job creation, clean energy and broadband infrastructure, housing and R&D programs

Our Budget Creates a Fairer Tax System
• Ends the recently passed upper-income tax cuts and lets Bush-era tax cuts expire at the end of 2012
• Extends tax credits for the middle class, families, and students
• Creates new tax brackets that range from 45% starting at $1 million to 49% for $1 billion or more
• Implements a progressive estate tax
• Eliminates corporate welfare for oil, gas, and coal companies; closes loopholes for multinational corporations
• Enacts a financial crisis responsibility fee and a financial speculation tax on derivatives and foreign exchange

Our Budget Protects Health
• Enacts a health care public option and negotiates prescription payments with pharmaceutical companies
• Prevents any cuts to Medicare physician payments for a decade

Our Budget Safeguards Social Security for the Next 75 Years
• Eliminates the individual Social Security payroll cap to make sure upper income earners pay their fair share
• Increases benefits based on higher contributions on the employee side
Our Budget Brings Our Troops Home
• Responsibly ends our wars in Iraq and Afghanistan to leave America more secure both home and abroad
• Cuts defense spending by reducing conventional forces, procurement, and costly R&D programs

Our Budget’s Bottom Line
• Deficit reduction of $5.6 trillion
• Spending cuts of $1.7 trillion
• Revenue increase of $3.9 trillion
• Public investment $1.7 trillion

I’ve culled the quotes to emphasize approval of this plan by certified establishment types.

President Bill Clinton
"The most comprehensive alternative to the budgets passed by the House Republicans and recommended by the Simpson-Bowles Commission"

"Does two things far better than the antigovernment budget passed by the House: it takes care of older Americans and others who need help; and much more than the House plan, or the Simpson-Bowles plan, it invests a lot our tax money to get America back in the future business"

The Economist
“Mr Ryan's plan adds (by its own claims) $6 trillion to the national debt over the next decade, but promises to balance the budget by sometime in the 2030s by cutting programmes for the poor and the elderly. The Progressive Caucus's plan would (by its own claims) balance the budget by 2021 by cutting defence spending and raising taxes, mainly on rich people.”

The Washington Post
“The Congressional Progressive Caucus plan wins the fiscal responsibility derby thus far."

Forbes
"instead of gutting programs for the poor like Medicaid and Medicare, food stamps, and the new healthcare law, the People’s Budget focuses on cuts in defense. It also doesn’t scrap new financial regulations designed to at least partly stave off another massive financial collapse like the one that put us in this mess in the first place."



A friend and I did a single payer presentation for the VP of our local business round table

He was very skeptical of government. My colleague wrote down his major concerns, and we prepared comments on them as follows.

BUSINESS CONCERNS

• Medicare is broke
• Government just messes things up
• WA workers’ compensation benefits are the highest in the nation and adding more taxes is too burdensome for state businesses
• Medicaid taxes are too high and the rising cost of Medicaid is causing cuts to education funding in WA state
• Most businesses are going to a high-deductible health insurance model with Health Savings Accounts as a more cost-effective way to provide employee benefits
• Public Utilities such as the Fire Department and Seattle City Light keep increasing their budgets and raising their rates. Contracting with private companies might lower costs by increasing competition.
• Healthcare is not as important as education or transportation infrastructure

RESPONSES

MEDICARE IS BROKE
The Medicare risk pool is made up of retired and disabled individuals who require more health care because of their age and condition. By opening up the risk pool to include younger and healthier individuals, you can cover more people more cost effectively. Of course, younger and healthier individuals sometimes need expensive care as well, but again, by increasing the risk pool, the costs per person will decrease. Indeed, when the CBO crunched the numbers during the health care reform debate, they came to the conclusion that the only plan that would contain health care costs was a universal plan like Medicare. There is also an enormous liability in drug coverage due to price negotiation having been written out of the drug benefit legislation. Medicare should be able to obtain volume discounts similar to those that are available to large concerns in every industry. The cost controls of regional global budgeting are not now part of Medicare, but they would be under Medicare for All.

GOVERNMENT JUST MESSES THINGS UP
Yes, sometimes government programs don’t run as well as they should. The Medicare drug benefit is a case in point. As a result of lobbying by the pharmaceutical industry, the prices of Medicare prescription drugs could not be negotiated. The result was poor public policy, with burdensome costs to both the government and covered individuals.

In contrast, there are many government-funded programs that have been successful: the interstate highway system which fostered tourism-related businesses as transportation industries, the GI bill after World War II which enabled a generation of young Americans to complete college degrees and fuelled America’s world economic dominance. The catalog mail order business and mass market magazines were products of the Rural Free Delivery Act of the 1890s.

The entire computer industry was created by the government during WW II, and the government was the major customer for mainframe computers through most of the 50s. The hacker subculture that created the personal computer was entirely funded by the government at MIT and Stanford. The government created the internet itself, which has caused numerous spin-offs in all sorts of directions creating products and wealth barely dreamed of a generation ago.

The government also created the entire aviation industry and still pays for most of the infrastructure. Boeing’s civilian aircraft division didn’t make a single dime in profit for 20 years, subsidized by defense contracts the entire time. European governments realized that they would have to create similar subsidies in order to compete.

Notice what is true in all these cases—the government sets the specifications, pays the bills, regulates and may pay for ongoing infrastructure support, but the actual work is carried out by private businesses. This is how single payer health care would work.

WORKERS’ COMPENSATION BENEFITS ARE TOO HIGH
Under a single-payer health system, all payments for medical care would be funded through the Washington Health Security Trust and all state residents would receive care as part of that coverage, thus reducing the overall cost of medically-related employee benefits.

MEDICAID TAXES ARE TOO HIGH AND THE RISING COST OF MEDICAID IS CAUSING CUTS TO EDUCATION FUNDING
WA receives funds from the Federal Government for Medicaid benefits. These funds would be channeled into and disbursed by the WHST. Given the savings projected to be generated by a universal health care system, all health care spending including Medicaid should decrease, causing more funds to be available for education and other important state programs.

MOST BUSINESSES ARE GOING TO A HIGH-DEDUCTIBLE INSURANCE BENEFIT WITH HEALTH SAVINGS ACCOUNTS.
For many years businesses have been concerned about the rise in health care costs. Some have tried the high-deductible plans and found that such plans did not serve them or their employees well. If employees are young and healthy, this is cost-effective. If not, the costs are just as great or greater than in a traditional health insurance plan. These plans are just an attempt to avoid having the healthy 85% majority pay for the care of the expensive 15% minority—this ratio holds in all age demographics, though younger groups are cheaper. This undermines the entire point of a shared risk pool, in which the healthy are forced to pay for the care of the sick. This is perfectly fair, as you have no way of knowing whether or not you will ever be part of the unlucky 15%. There is simply no way around this—we pay anyway, and at far higher rates. There was a very well known case of a child with an infected tooth in Maryland a few years ago. His mother could not afford $85 to have the tooth pulled, so he got blood poisoning. The emergency room spent $250,000 trying to keep him alive, but he died anyway. Is promoting high deductible plans really worth $249,915 to business?

PUBLIC UTILITIES KEEP INCREASING BUDGETS AND RAISING RATES
Fire and police services are part of the public safety expenditures of a society, and they get more expensive over time just like everything else. Levies are presented to voters periodically, and are routinely approved. Having a centralized source of public safety services ensures comprehensive coverage with reduced jurisdictional issues. Without regulation, utilities inevitably use their monopoly power to steal from the public. Seattle City Light is still paying for being shafted by California’s totally fake “energy crisis,” caused directly by deregulation. Areas served by publicly owned utilities had no brownouts, and there have been none since regulation was put back into place.

Increasing competition creates nothing but disaster in the production of public goods. Markets work only when you want more of something—fantastic if you are talking about hard drive memory or restaurant variety, but horrendous when you are talking about heart attacks, assaults and house fires. Two competing sets of capital equipment doubles the price of public goods right from the start. If a second cardiac center opens in a city well served by just one, people are not going to obligingly start having twice as many heart attacks. The single most important factor in surviving complex surgery is the number of similar operations performed by the surgical team. Cut the number of surgeries in half, and their competence is degraded by half.

HEALTHCARE IS NOT AS IMPORTANT AS EDUCATION OR TRANSPORTATION INFRASTRUCTUREWhether that is true or not, the savings achieved by a universal state-wide health care system can help to restore funding for education and transportation.

Health insurance is not health care !!

http://www.scribd.com/doc/96682782/Sick-in-Massachusetts

Today most sick adults in Massachusetts see the cost of health care as a serious problem for the state, and they view the problem as having gotten worse over the past five years. Sick adults are more troubled by costs than they are by quality.

Although Massachusetts has nearly universal health insurance coverage, the costs of health care are a serious financial problem for many sick adults and their families. Some sick adults report having been refused medical care for financial or insurance reasons. Additionally, some sick adults say they did not get needed medical care because they could not afford it. Taken together, these finding suggest that insurance coverage does not protect some Massachusetts residents against the financial hardships of illness, likely reflecting recent trends in higher deductibles and co-payments.


Comment by Don McCanne of PNHP: This survey is particularly important because it provides the real life health care financing experiences of patients who have serious medical problems - precisely those for whom the system should be designed to serve.

In Massachusetts, "Forty percent of sick adults in the state said the out-of-pocket costs of medical care are a 'very serious' (16%) or 'somewhat serious' (24%) problem for them." Obviously the financing system is not serving well those individuals with major medical needs.

Another significant finding: "About a quarter of sick adults (24%) who have been insured at any time during the past year say they have had a problem with their insurance paying a hospital, doctor, or other health care provider in the past 12 months." Thus the insurers are not doing their job either.

Since the Affordable Care Act uses a financing design similar to that of Massachusetts, we can anticipate the same miserable performance for the nation, or more likely even worse because of other design flaws in ACA.

At a minimum, we should expect the health care financing system to work well for those with serious problems. The ACA design won't cut it. We really do need a single payer national health program that would work well for all of us.

My comment: In no other country in the developed world is cost a serious barrier to obtaining health care for most people. Why do we tolerate this?

Three possible outcomes for health care from the SCOTUS--PNHP has briefs for all

If the court upholds ACA
http://www.pnhp.org/sites/default/files/docs/2012/supreme-court/Fact-sheet-Court-upholds-law-1.pdf

If the court strikes down the individual mandate only
http://www.pnhp.org/sites/default/files/docs/2012/supreme-court/Talking-points-if-Supreme-Court-strikes-mandate-2.pdf

If the court strikes down the whole law
http://www.pnhp.org/sites/default/files/docs/2012/supreme-court/Fact-sheet-Court-strikes-down-whole-law-3.pdf

UnitedHealthcare extends the CHEAP protections in health care reform

http://www.unitedhealthgroup.com/newsroom/news.aspx?id=59c64ad7-908b-4806-931f-aed3beff7ba0

UnitedHealthcare, a UnitedHealth Group (NYSE: UNH) company, will continue to offer important health care insurance protections that were included in the 2010 health care reform law, no matter how the U.S. Supreme Court rules in cases currently pending before the Court.

UnitedHealthcare will continue provisions related to coverage of preventive health care services, coverage of dependents up to age 26, lifetime policy limits, rescissions and appeals.

"The protections we are voluntarily extending are good for people's health, promote broader access to quality care and contribute to helping control rising health care costs. These provisions make sense for the people we serve, and it is important to ensure they know these provisions will continue," said Stephen J. Hemsley, president and CEO of UnitedHealthGroup. "These provisions are compatible with our mission and continue our operating practices."

These protections are effective immediately, and will remain available to current and future customers and members. The company is not establishing any sunset provisions.

UnitedHealthcare recognizes the value of coverage for children up to age 19 with pre-existing conditions. One company acting alone cannot take that step, so UnitedHealthcare is committed to working with all other participants in the health care system to sustain that coverage.

The specific provisions being extended by UnitedHealthcare are:
Preventive Health Care Services without Co-Pays
Providing Dependent Coverage Up to Age 26
Eliminating Lifetime Limits
No Rescissions, Except for Fraud


Comment by Don McCanne of PHHP: You have to hand it to UnitedHealth's public relations department. No matter how the Supreme Court rules on the Affordable Care Act (ACA), this press release establishes UnitedHealth as a leader in patient advocacy, or at least it would seem so.

If ACA is upheld, this press release means nothing since these are already requirements of the Act. If ACA is struck down, these are very popular measures that are quite inexpensive and thus will not drive up premiums to non-competitive levels. The most expensive measure is the coverage of dependents up to age 26, but that adds only about one percent to the premiums. Besides, other insurers will likely follow suit in order to more effectively market to a greater number of young, healthy families. So no matter what happens, UnitedHealth takes credit for taking the lead.

UnitedHealth used one example of a policy that they will not follow, indicating that they will not unilaterally provide patients with some of the more important protections required in ACA. They are correct when they say that they cannot cover children with preexisting conditions unless the entire industry cooperates in distributing those higher cost risks. If one insurer generously accepts those risks, then their costs would skyrocket and they would be forced out of the market by the death spiral of insurance premiums.

UnitedHealth has remained silent on some of the more important requirements not yet in effect that could be overturned by the Supreme Court decision. Insuring preexisting conditions for adults in addition to children, guaranteeing issue of coverage to all individuals regardless of projected costs, and setting premiums based on community rating - driving up premiums for lower-cost, healthier patients - are more significant measures that could impair their competitiveness if they acted unilaterally. We won't see these policy changes unless ACA is upheld and all insurers are required to comply.

Also they are silent on keeping administrative costs and profits down to a level that complies with the medical loss ratios dictated by ACA. Turn ACA over then there would be no federal requirement to comply, though that would still be the prerogative of the states. States under the political control of anti-government, free-market advocates would likely leave medical loss ratios to the insurers and their Wall Street promoters (where low medical loss ratios - spending less on patients- is a business activity that is rewarded with higher stock valuations).

UnitedHealth's "generosity" in conceding the very modest positions they listed in their release applies only to the individual and small group markets - a relatively small proportion of their business. Most plans for large employers will be grandfathered, and most of the ACA provisions will not apply - certainly not the requirements specific to the exchanges since large employer plans will not be included in the state exchanges. Also, many large employers are self-insured, and for them UnitedHealth provides only administrative functions, while specific benefits are determined by the employers.

We can't blame UnitedHealth for trying to protect its market position, but we can blame our elected representatives for adopting policies that perpetuate and expand an industry which must comply with market demands for lower prices - a demand that can be met only by strategic decisions to avoid market segments such as children who are ill.

Is that what America is about? Let's take care of the kids, even up to age 26, but not the sick ones? What other country does that?

Health Care Wars--new book by John Geyman

Health Care Wars
How Market Ideology and Corporate Power Are Killing Americans
By John Geyman, M.D.

From the Preface--

We have been told from time immemorial in this country that free markets, unfettered by government interference, are the fix for any of our problems. The notion that a competitive private marketplace gives us more information, choice, efficiency and value has been repeated so often for so long that it has become a meme (a self-replicating idea that is perpetuated regardless of its merits). Although this idea has become as American as apple pie and might work in some sectors of the economy, it does not work that way in health care.

The shared prosperity that followed World War II gave rise to the American dream that brought new hope and opportunities for much of our population. But over the last 30 years, under a relentless attack by conservatives and willing Democrats, this dream is disappearing.

This book takes an evidence-based approach to assess and describe the track record of health care markets as they actually work. As you will see, it is a story of profiteering, greed and waste with very little accountability. I hope that this book is useful in informing the public, policymakers and politicians of the real problems with markets. We will need a strong and powerful unified grassroots movement to push our leaders toward real reform.

http://www.copernicus-healthcare.org/


Comment by Don McCanne of PNHP: It has long been recognized that health care does not follow the rules of free markets, yet the United States continues to rely on a fragmented, dysfunctional financing system that fails to adequately correct for these market deficiencies. In Health Care Wars, John Geyman shows us how this has been a disaster, while providing us with hope through the prospect of our empowerment as both patients and taxpayers.

On financial risk, medical bankruptcy works as well as a high-deductible plan

NBER:
http://papers.nber.org/papers/w18105?utm_campaign=ntw&utm_medium=email&utm_source=ntw

Full paper (highly technical):
http://www.stanford.edu/~nmahoney/Research/Mahoney_Bankruptcy.pdf


In the first part of the paper, I argue that the fact that most medical care is provided on credit coupled with the fact that this debt can be discharged for seizable assets in bankruptcy provides households with implicit high-deducible health insurance.

I next evaluated the quantitative importance of this mechanism. Exploiting cross-state and within-state variation in asset exemption law, I show that uninsured households with greater seizable assets make higher out-of-pocket medical payments, conditional on the amount of care received. In turn, I find that households with greater wealth-at-risk are more likely to hold health insurance coverage. Health insurance is wealth insurance, to a certain degree, and is less valuable to those with fewer assets.

The final part of the paper examined ways in which the implicit insurance from bankruptcy might inform the design of health insurance policy. Because households do not pay for bankruptcy insurance, too many households choose to be uninsured on the margin. Using a utility-based, microsimulation model of insurance choice, I estimate that the optimal Pigovian* penalties are similar on average to the penalties under the ACA.

* A Pigovian tax is a tax levied on a market activity that generates negative externalities. The tax is intended to correct the market outcome. In the presence of negative externalities, the social cost of a market activity is not covered by the private cost of the activity. In such a case, the market outcome is not efficient and may lead to over-consumption of the product. A Pigovian tax equal to the negative externality is thought to correct the market outcome back to efficiency. In the presence of positive externalities, i.e., public benefits from a market activity, those who receive the benefit do not pay for it and the market may under-supply the product. Similar logic suggests the creation of Pigovian subsidies to make the users pay for the extra benefit and spur more production. (Wikipedia, accessed 5/29/12)



Comment by Don McCanne of PNHP: At the risk of oversimplification, this paper demonstrates that personal bankruptcy can serve as a form of health insurance in individuals who are otherwise uninsured and have negligible wealth that is at risk and negligible assets that can be seized in a bankruptcy proceeding.

What a terrible thesis this is to study - suggesting that bankruptcy can suffice for health insurance in people with no wealth and no seizable assets. Maybe that is acceptable if impaired health care access due to lack of funds is not important, or if we accept that the costs of uninsured care should be shifted to insured individuals, or, above all, if we assume that the indignity of personal bankruptcy is small price to pay for this perverse form of "insurance."

Perhaps one of the most alarming sentences in this paper is the following: "Thus the impact of bankruptcy on financial risk is exactly what you would expect from a high-deductible health plan."

Wow! On financial risk, bankruptcy works as well as a high-deductible plan!

Instead of trying to figure out whether or not Pigovian penalties are similar to penalties under the Affordable Care Act, why don't we instead move forward with a health care financing system that doesn't ever involve bankruptcy, or Pigovian penalties for that matter - a single payer national health program. Not only would that be much simpler, we would all get the health care that we need.

Single Payer would save billions for MA

http://bostonglobe.com/opinion/2012/05/30/single-payer-health-care-would-save-billions-for-massachusetts/yNTLRlKucgdJCUCU3P5arM/story.html

http://www.healthcare-now.org/single-payer-health-care-would-save-billions-for-massachusetts

The House and Senate health care proposals would set imaginary limits for spending growth enforced by secret “improvement plans” and wrist slaps for hospitals that overcharge; establish tiered payment schemes to consign the poor and middle class to second-tier hospitals and doctors; push most residents of the Commonwealth into HMOs (oops, we forgot, now they’re called “accountable care organizations,” or ACOs); and wipe out small doctor’s offices by “bundling” their pay into ACO payments. Apparently the legislators’ theory is that forcing health care providers to consolidate cuts costs. Oligopoly saves money?

Here are six alternative steps the Legislature could take that would actually save money while still preserving care.

■ Cut out the middlemen. Why exactly do we pay private insurers 10 cents of every premium dollar? The plan that covers all 13 million residents of the Canadian province of Ontario has overhead of only 1 percent. Adopting that single-payer approach in Massachusetts would save about $2 billion in insurance overhead in 2013 alone.

■ Pay hospitals the way we pay fire departments: real global budgets that cover all operating costs, not the per-patient schemes that are masquerading as global payments. Billing, collections, and paperwork consume nearly one quarter of hospitals’ revenues. Eliminate billing for individual patients and you’d cut that nearly in half. The savings: about $3 billion in 2013.

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