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Michelle Bachmann, Save Us

The Federal Bureau of Investigation has moved to arrest nine members of the Hutaree militia on charges of seditious conspiracy, attempted use of weapons of mass destruction, teaching the use of explosive materials, and possessing a firearm during a crime of violence.  The FBI believes these individuals were planning to kill a local law enforcement officer, then attack the law enforcement officers who gathered to attend the funeral.  

Despicable!

During the fall of 2008, many of us became acquainted with Michelle Bachmann, a Republican representing Minnesota's Sixth Congressional District, through this video.  I'm hoping that with the arrests announced in Michigan yesterday, that Ms. Bachmann will be "taking a penetrating look" at whether the views of these militia members are "pro-America or anti-America."

I'm hoping . . . but I'm expecting she'll still be looking in all the wrong places for the people we really need to worry about.

Goodbye David Frum

David Frum has been terminated from his position as a resident fellow at the American Enterprise Institute, where he has written and lectured since leaving President Bush's staff.  So much for being able to have an intellectual discussion of issues and respectful disagreement.

His firing seems to make his point exquisitely that the Republican party has been captured by the far right-wing.  His firing seems to indicate that the purging and ideological purification is not yet finished.  

Frum is quoted by Media Matters here as saying his termination was due to "donor pressure."  I think this action, taken by a leading conservative think-tank, only reinforces the validity of comments he made following passage of the health reform legislation.  At that time, he blamed Fox and conservative talk radio for whipping the base into such a frenzy that negotiation on healthcare became impossible.  

In an ABC Nightline broadcast, Media Matters quotes Frum as saying, 

"Republicans originally thought that Fox worked for us, and now we are discovering we work for Fox." 

Frum argues that it is in Fox's interest to keep the base in a frenzy, because that will drive the base to Fox broadcasts. He said here,

"I’ve been on a soapbox for months now about the harm that our overheated talk is doing to us. Yes it mobilizes supporters – but by mobilizing them with hysterical accusations and pseudo-information, overheated talk has made it impossible for representatives to represent and elected leaders to lead."  

So long as only the far-right fringe can participate in debate within the Republican Party, I can see no way that the broad American independent middle will entrust governing to Republicans.  The best ideas don't come from group-think, but from diverse thoughts, openly expressed and accepted, even when not agreed with entirely.  That certainly does not describe today's Republican Party, and certainly doesn't describe the Tea Party.

An End to Corporate Double-Dipping?

With passage of the health reform bill, a number of public corporations are taking charges against future earnings because they are losing a tax deduction that they received when they accepted federal subsidies for providing prescription drug benefits to retirees.  This gift from American taxpayers, has been provided since the Medicare Part D drug benefit was enacted in 2003.  

Under that law, passed by a Republican controlled Congress and signed by President George W. Bush, corporations that provide prescription drug benefits to retirees are eligible to receive a federal subsidy of up to $1,330 per retiree.  And, in tax treatment that only a (Republican?) Congress could invent, the $1,330 per retiree subsidy was not treated as income to the corporation, and therefore taxable.  It was treated as an expense of the corporation, and therefore tax deductible, making the benefit worth even more to the corporation, while reducing tax revenue for Federal and state governments.

So, in 2003, Congress charged the entire Medicare Part D program to the Federal national debt, provided subsidies to corporations that provided a drug benefit to retirees similar to that provided under Medicare Part D, but allowed the subsidy they provided to the corporation to be a deductible expense, rather than a taxable income stream.  Since the health benefits provided by corporations are already tax deductible, this provision allowed a  tax deduction on the subsidy provided by federal taxpayers.  So the corporation was given federal money to help it pay for its health plan's prescription benefit for retirees, it was also allowed to deduct as a business expense, the money it received from taxpayers, and used to buy prescription medicine.  It is a little like winning the lottery, and being able to take a tax deduction on the value of your winnings.  

Under the new health reform legislation, beginning in 2013, corporations will continue to receive the subsidy, but will lose the ability to take a tax deduction for the subsidy.  As a result, corporations like AT&T, Caterpillar and Deere and Company have already announced charges against future earnings.  By eliminating the ability of corporations to take tax deductions on subsidies provided by taxpayers, the new health reform law will raise some revenue and rationalize tax treatment of these corporate transfer payments.

Conservatives Got Foxed

Tonight's crushing Republican defeat will be worse than most conservatives realize, according to George W. Bush speechwriter, David Frum, who calls this the conservative's Waterloo.  He writes that conservatives see a big win in November as compensation for this defeat, but he cautions that such a victory may be elusive.

The economy will have improved by November, Frum writes, and the immediate benefits from the healthcare bill's passage will begin to be felt -- young adults will be able to stay insured through a parent's health plan until age 26; children with pre-existing conditions will be able to get health insurance; seniors who fall into the Medicare donut hole will find an additional $250 of coverage available.  

He blames defeat on Republicans and conservatives who refused to negotiate or compromise, choosing to go for all the marbles, and ending up with none.  He also blames conservative talk on Fox News which whipped up the base into such a frenzy that negotiation was impossible.  

How do you negotiate with somebody who wants to murder your grandmother?  Or – more exactly – with somebody whom your voters have been persuaded to believe wants to murder their grandmother?  

I agree with Frum when he writes, "This win for the conservative entertainment industry is a defeat for the conservative cause."  I believe the country has paid an enormous price for the over-the-top rhetoric -- we were denied the best thinking of both parties, because the Republicans simply refused to engage in the legislative process.  And, as Andrew Sullivan wrote recently about conservatives here,

At some point, they'll grow up, and realize politics is not a game to be "won" but a process to be engaged.

If that day comes, soon, America will be better off.

219 trumps 212

The House has passed the Senate health reform bill on a vote of 219 - 212, with unanimous Republican opposition.  

A Benefit to Partisanship

Ezra Klein is a must read here.  He points out that in 1993, President Clinton tried to reform healthcare against the uniform opposition of the pharmaceutical industry, hospital associations, American Medical Association, Health Insurance Association of America and major employers.  This time, some of these organizations are supporting the legislation, and none of these associations are actively opposing President Obama's plan.  

Imagine what these associations could have gotten if they could have recruited two or three Republicans.  On this bill, Republicans haven't been the party of business, or they would have helped business get some really great (for business) deals.  This legislation shows that the Republicans are far more committed to strong partisan incentives than they are to business.  This may be a case where bipartisanship would have weakened, rather than strengthened the final bill that is passed..  

American Medical Association Supports House Bill

The American Medical Association has, today, announced its qualified support for the current health reform bill pending before Congress.  

J. James Rohack, M.D., AMA president said:

"By extending health coverage to the vast majority of the uninsured, improving competition and choice in the insurance marketplace, promoting prevention and wellness, reducing administrative burdens, and promoting clinical comparative effectiveness research, this bill will help patients and their physicians."

The House's Hall of Shame

How do Representatives like Louis Gohmert (R-TX), Kay Granger (R-TX) and Jeb Hensarling (R-TX) vote against health reform?  Their districts, Texas's 1st, 12th and 5th Congressional Districts, have 25.5 percent, 25.7 percent and 25.8 percent, of their respective populations uninsured.

How do guys like Connie Mack (R-FL) and Vernon Buchanan (R-FL) vote against health reform?  Their districts, Florida's 14th and 13th Congressional Districts, have 26.1 percent and 26.2 percent of their respective populations uninsured.

How does a guy like K. Michael Conway, (R-TX) vote against health reform?  His district, Texas's 11th, has 27 percent of its population uninsured.

How does a guy like David Boren (D-OK) vote against health reform.  His district, Oklahoma's 2nd Congressional District, has 29.3 percent of its population uninsured.

How do guys like Lincoln Diaz-Balart (R-FL) and Mario Diaz-Balart (R-FL) vote against health reform.  Each of their districts, Florida's 21st and 25th Congressional Districts, have 31.3 percent of their populations uninsured.  

How does a woman like Ileana Ros-Lehtinen (R-FL) vote against health reform.  Her district, Florida's 18th, has 32.7 percent of its population uninsured.

How does a guy like Pete Sessions (R-TX) vote against health reform?  His district, Texas's 32nd Congressional District, has 35.7 percent of its population uninsured.  

Do these people believe we can just keep doing what we are doing? Do they really think high quality hospitals and skilled physicians will continue to survive in markets where one-in-four, or one-in-three people have no insurance, and therefore no way to pay for their healthcare?  Do they really think it makes sense for the small percentage of the population that is hospitalized, to pay all the costs of treating the uninsured, so our hospitals can stay solvent?

These are House members.  They run from areas that are relatively small, geographically.  Their districts have enormous needs for health reform, with uninsured populations 60 percent or more above the the national average.  And yet, apparently, they are unable to hear the painful sounds of today's status quo crying out from within their own districts. 

These Represenatives are my nominees for the House's Hall of Shame.

Healthcare and Deficit Reduction

The Congressional Budget Office estimates are out showing the reconciliation version of the bill which will be voted on by the House will provide significant deficit reduction -- $138 billion -- in the first 10 years, and $1.2 trillion during FFY 2020-2029.  The bill is expected to provide coverage to 32 million Americans who are currently uninsured, and contain healthcare costs for those of us with insurance.

More on Universal Care and Abortion

Additional information providing support for the contention that expanding health insurance coverage will reduce abortion rates is provided by The New England Journal of Medicine in an article posted online March 17.

The study reviewed abortion rates in the state of Massachusetts since the introduction of Commonwealth Care. Among those with incomes below 300 percent of the Federal Poverty Level, the percentage uninsured fell from 24 percent to eight percent, a material reduction. Massachusetts provides abortion coverage in its Medicaid program, and in the Commonwealth Care program which is available to cover those with incomes above the Medicaid eligibility threshold.

The data, which are available for only the first two years of this new program, show a modest decline in the number of abortions. Abortions in Massachusetts fell 1.5 percent during the two year period. Abortions among teenagers declined 7.4 percent during the period, and it is this age group which might be the most likely to see options, other than abortion, when health coverage is available. (See comments of Cardinal Basil Hume, here.) All of these events occurred during a period of modest declines in the abortion rate, and in a period of rising birth rates in Massachusetts among women aged 15 to 44.

Patrick Whelan, M.D., Ph.D., the study's author concludes by writing:

I believe it is reasonable to conclude that the possibility of some federal subsidization of overall care, for a fraction of the additional 31 million people who would be covered, would not mean a significant or even a likely increase in the number of abortions performed nationally. 

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The World's Best Healthcare? Really?

Among the reasons cited for opposing health reform is the oft repeated line that the U. S. has the world's best healthcare, and we certainly would not want to do anything to hurt it. (As if providing greater access to its benefits will somehow ruin healthcare.)

But a Commonwealth Fund study shows that the United States' health system ranks last among 19 nations in doing what health systems are supposed to do -- reduce the rate of amenable mortality. That is, deaths that occur from certain causes, before age 75, which are potentially preventable with timely and effective health care. These are not the illnesses where medical miracles need to occur. These are the illness that medicine knows how to treat, such as treatable cancers, diabetes and cardiovascular disease.

Between 1997-98 and 2002-03, the amendable mortality rate fell by an average of 16 percent in all countries, except the U. S., where the decline was only four percent. In 1997-98, the U. S. ranked 15th among 19 countries; by 2002-03, America had fallen to last place.

Here's a graphical presentation of these data from 1997-98 and from 2002-03 taken from this October 2008 Commonwealth Fund report:

The authors of this study, Ellen Nolte, Ph.D., and C. Martin McKee, M.D., D.Sc., conclude with the obvious point, "The findings presented here are consistent with other cross-national analyses, demonstrating the relative underperformance of the U. S. health care system in several key indicators, compared with other industrialized countries."

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0 Trumps 700,000

I'm reading T. R. Reid's book The Healing of America: A Global Quest for Better, Cheaper and Fairer Health Care. He writes about the world's major health systems, and notes that every major developed country, except the United States, ensures that all of its citizens have access to medical services. They do it in a variety of effective ways, but they all do it. America is exceptional for its failure to do so.

And, because other developed countries do ensure everyone has access to healthcare, they do it for far less cost per capita, than the United States. This is true, even though many of these countries, have far larger percentages of their population in the 65 and older and 80 and older age groups, than does the United States. Older people use much more medical care than do those under age 65.

Country	% 2000 Population 65+	% 2000 Population 80+
France	15.9%	3.8%
Germany	16.4%	3.6%
Japan	17.1%	3.7%
United Kingdom (Britain)	16.0%	4.2%
United States	12.5%	3.3%

In his travels around the world to learn about the major health systems, he asked the health ministry of each country how many citizens had declared bankruptcy in the past year because of medical bills. "Generally," he writes, "the officials responded to this question with a look of astonishment, as if I had asked how many flying saucers from Mars landed in the ministry's parking lot last week.

"How many people go bankrupt because of medical bills? In Britain, zero. In France, zero. In Japan, Germany, the Netherlands, Canada, and Switzerland: zero. In the United States, according to a joint study by Harvard Law School and Harvard Medical School, the annual figure is around 700,000," even though we've modified bankruptcy law to make filing more difficult. We've reformed bankruptcy law to provide additional protection for creditors. It's now time to reform healthcare to provide protection for all Americans.

The U. S. population totals about 307 million people. The population of Britain, France, Japan, Germany, the Netherlands, Canada and Switzerland totals more than 392 million.

The purpose of health insurance is to protect us from the financial catastrophe resulting from illness or injury. The rest of the industrial world has developed far more effective answers than we have in the United States. The score is World - 0, United States - 700,000. And with a score like that, it's the United States that is losing.

4,750 Trumps 2,409

2,409.
Republicans cite the 2,409 pages in the Senate's health reform bill as reason enough to defeat it. We should not be taking on so much, they say. We should go step by step.

4,750.
Terence Bryan Foley's battle against cancer over a seven year period generated 4,750 pages of medical bills and explanation of benefits forms. No American family should have to take on so much, I say. We should pass the health reform bill.

 

Good, Bad and Ugly

This story about Terence Bryan Foley's seven-year fight against kidney cancer sums up all that is right, and all that is wrong with America's healthcare financing and delivery system. Mr. Foley had access to some of the nation's best hospitals and physicians, and was enrolled in clinical trials testing the newest treatments for his disease. He had excellent health insurance coverage, provided by his wife's employer.

That coverage provided outstanding protection against the $618,616 in charges incurred, leaving the family financially responsible for a mere $9,468. Providers, who billed $618,616, were paid only $254,176, after insurer's contractually negotiated discounts. This means, hospitals, physicians, imaging centers, laboratories and pharmacies wrote off 57 cents of every dollar they billed, because the insurance carriers that administered Mrs. Foley's health plan had negotiated very steep discounts. It also means that other insurance carriers, with smaller market shares and less negotiating clout were paying far more for the same service. And tragically, the uninsured, with no one to negotiate on their behalf, would be asked to pay the full amount charged by the hospital.

Universal Healthcare Cuts Abortion Rates

Much of the current debate about whether the Democrats will be able to muster the majority they need in the House, centers on abortion, and the number of pro-life Congressmen willing to stand with Bart Stupak (D-MI), who believes language he inserted in the House bill is stronger than that included in the Senate bill for prohibiting the use of federal funds for abortion.  T. R. Reid, writing in the Washington Post, makes the case that universal healthcare is one of the most powerful tools for reducing abortion rates. 

Reid shows that abortion rates are lower in developed countries that have universal health plans, than in the United States, which does not.  In Canada, the abortion rate is 15.2 per 1,000 women aged 15 to 44;  in Denmark, it's 14.3; Germany 7.8; Japan, 12.3; Britain, 17.0; and the United States, 20.8.

The abortion rate in the United States is 22.4 percent higher than it is in Britain, but in Britain, only eight percent of the population is Roman Catholic, compared to about 25 percent of the United States' population.  In Britain, abortion is legal, and is provided free, yet British women have far fewer abortions than do women in the United States. 

Reid quotes Roman Catholic Cardinal Basil Hume who said there were several reasons why British women have fewer abortions than U. S. women, but one important explanation was Britain's universal health care system.  Cardinal Hume said,

 "If that frightened, unemployed 19-year-old knows that she and her child will have access to medical care whenever it's needed, she's more likely to carry the baby to term.  Isn't it obvious?"

An unidentified young woman in Britain added another explanation.  

"If you're sexually active, the way to avoid abortion is to avoid pregnancy.  Most of us do that with an IUD or a diaphragm.  It means going to the doctor.  But that's easy here, because anybody can go to the doctor free."

Reid concludes his argument with these words:

"When I studied health-care systems overseas in research for The Health of America:  A Global Quest for Better, Cheaper, and Fairer Health Care, I asked health ministers, doctors, economists and others in all the rich countries why their nations decided to provide health care for everybody. The answers were medical (universal care saves lives), economic (universal care is cheaper), political (the voters like it), religious (it's what Christ commanded) and moral (it's the right thing to do).  And in every country, people told me that universal health-care coverage is desirable because it reduces the rate of abortion.

"It's only in the United States that opponents of abortion are fighting against expanded health-care coverage -- a policy step that has been proved around the world to limit abortions."

The pro-life movement has been an important constituency of the Republican Party for generations.  But now the pro-life movement, in working to defeat health reform, is putting it's allegiance to the Republican Party's positions ahead of its allegiance to life.

Soaring Premiums -> Surging Underinsured

Drew Altman, Ph.D., president and CEO of the Kaiser Family Foundation, writes an excellent piece describing the serious erosion of health insurance benefits. Those who bought their own health insurance, from 2004 to 2007, still paid 52 percent of their health expenses, on average, out of their own pocket.

How is this possible? Through a clever insurance marketing tool the insurance industry refers to as a "buy-down." If insurance premiums get pushed up fast enough, the rational response of consumers is to beg for relief. Insurers commonly suggest that the increase can be mitigated or even eliminated by switching to a policy with higher deductibles or greater cost sharing, which provides less protection for the consumer. As a result, we have a surging number of Americans who are underinsured, many unknowingly. These people are a serious illness or accident away from a financial shock when they find the insurance they have been paying for provides far less protection than they need.

Imagine a family of four earning $70,000, and carrying individual coverage with a $3,500 deductible, 20 percent coinsurance to $6,000, and $40 office visit co-pay. If, in the midst of a snowstorm, their car slid into a bridge abutment, causing serious injuries to two family members, the family could be liable for two deductibles of $3,500 each, plus two out-of-pocket maximum's of $6,000 each, representing a total hit to the family budget of $19,000. How many families could come up with an amount equal to more than 27 percent of their annual income within 30 days of insurance making its payments to doctors and hospitals? And, in addition to these costs, these two individuals would be liable for $40 office visit co-pays each time they needed to see one of several physicians throughout the course of their recovery, even though they met their deductible and out-of-pocket maximum for the year. All of this is further exacerbated by the fact that the primary wage earner (or all wage earners) could be out-of-work while they recover. Not everyone has a ready supply of sick-leave that will ensure income continues uninterrupted during an extended convalescence. So, imagine having a debt of $19,000, coupled with a six week absence from work, and the pay that goes with it. Now that $19,000 debt represents almost 31 percent of the $61,923 this family would earn for 46 weeks of work.

Malpractice Payments Fall

Fewer medical malpractice payments were made on behalf of doctors in 2009 than any year on record, according to the National Practitioner Data Bank. A total of 10,772 payments were made on behalf of physicians in 2009, totaling $3.49 billion. Sounds like a lot, but we spent $2.5 trillion on healthcare in 2009. If we eliminated all payments for malpractice, we'd have saved 0.14 of one percent of what we spent. And some patients who had been badly harmed would have received nothing.

Between 2000 and 2009, healthcare spending is up 83 percent, while medical malpractice payments fell eight percent (both figures in unadjusted dollars). With malpractice reform one of the Republican Party's few ideas for reforming the health system, this report only confirms the bankruptcy of ideas from that side of the Congressional aisle.

 

Give 'em Hell, Harry!

Senator Harry Reid (D-NV) has rolled out his plan for passing healthcare reform.  You can read his blistering letter to Sen. Mitch McConnell (R-KY), here.  My favorite excerpt, discussing the use of reconciliation, is this:

"Given this history, one might conclude that Republicans believe a majority vote is sufficient to increase the deficit and benefit the super-rich, but not to reduce the deficit and benefit the middle class."

Sticking with the Devil They Know

Yes, health premiums have been rising far faster than wages and overall inflation for decades.  Yes, too many people are uninsured, and far too many are underinsured.  Yes, everyone should have access to adequate coverage for good quality health care.  No, I don't think people who have been covered their entire lives should ever be denied coverage because of pre-existing conditions.  No, I haven't looked into all this health reform stuff.  I think I'll stick with the devil I know.  The following cartoon illustrates the point well.

Favor/Oppose Health Reform

The latest trend in polls, minus Rasmussen generated data, show a sharp closing of the gap between those who oppose and those who favor health reform.  As people are coming to understand the contents of the proposals, and the enormous costs of the status quo, reform's support is growing.  Republicans, whose continuous opposition to this legislation is not lost on the public, should take no comfort in electoral prospects for November.  With major employers planning to sharply increase premiums, deductibles and other cost sharing provisions as noted in this Washington Post story, pressures for reform will only build.

Here's the latest trending, courtesy of Pollster.com:


For another take, see Ezra Klein, or Matthew Yglesias, who looks at trends without excluding Rasmussen polling.

NEJM U.S. Health Care Reform Interactive Timeline

The New England Journal Of Medicine has produced a fascinating U.S. Health Care Reform Interactive Timeline.  The timeline shows the major efforts made, key proposals offered, and failed attempts at legislation to address the need for universal health care over the past 100 years.  Clicking on events in the timeline, will, occasionally take you to articles from the archives of The New England Journal or Medicine.  For example, if you go to 1915, you'll find the American Association for Labor Legislation proposes compulsory health insurance.  By clicking on that topic, you'll find links to PDF versions of two articles entitled "Industrial Health Insurance" and "Tendencies in Health Insurance Legislation" from the 1916 edition of The New England Journal of Medicine.  

The "Tendencies in Health Insurance Legislation" compares health plans in Germany, Great Britain, Austria, Netherlands and Norway, with a bill proposed by the American Association for Labor Legislation.  The "Industrial Health Insurance" article suggests two provisions included in the reform legislation currently being considered by Congress.  They are, apparently, timeless.  The first suggests, "To be effective, health insurance should be compulsory, on the basis of joint contributions of employer, employee and the state." The second suggests, "It is highly desirable that prevention be emphasized so that the introduction of a compulsory health and invalidity insurance system shall lead to a campaign of health conservation similar to the safety movement resulting from workmen's compensation."  Ninety-five years later, that is still good advice.

Health care financing has had a tortured history in our country.  After 100 years, we are almost there.  

The Surge of the Underinsured

Much of the tragedy of our unreformed health care financing system is hidden. We don't find out how poorly we are covered by our health policy until we have a serious illness. An interesting report from the Commonwealth Fund shows the fastest growing population segment is those who are underinsured, not those who are uninsured.

The uninsured population has grown about 54 percent between 1993 and 2008, rising from about 30 million to 46.3 million in 2008. Since the full impact of the Great Recession was felt in 2009, and since those who can afford to keep employer-based health insurance as a result of COBRA for up to 18 months would only now be losing coverage, even at this point in 2010, the number of uninsured is probably less than 55 million, and this would represent an increase of 83 percent over 15 years.

The following charts show that the number of underinsured has grown by 62 percent in only the four years from 2003 to 2007. Conversely, those who are adequately insured in the population under age 65 (Medicare provides universal coverage for those 65 and older), dropped from 65 percent to 58 percent in the four year period. The cause? An 8.8 percent increase in the uninsured, and a 62 percent increase in the underinsured.

Let's "Rush" to Pass Health Reform

As if we needed more incentives to pass healthcare reform . . .

As if being sure our family, friends and neighbors were protected by adequate health insurance wasn't reason enough . . .

As if ending the abusive practices of the insurance industry which denies coverage because of pre-existing conditions to a woman who lost her job in the Great Recession, was treated for cancer, and after a lifetime of insurance coverage and good health, needed individual health insurance when COBRA coverage was exhausted, wasn't reason enough . . .

As if putting an end to 39 percent premium hikes, wasn't reason enough . . .

Rush Limbaugh has promised to leave the country if health reform is passed! He wasn't sure where he would go, "Costa Rica!" was his initial thought. Good choice, Rush. It's a country that, at No. 36, ranks just ahead of the United States in the World Health Organization's ranking of the world's health systems. But, unfortunately for Rush, Costa Rica, like most other industrialized, countries, provides healthcare for all its citizens. Rush wouldn't like that any better than he'll like America after health reform is passed.

But Markos Moulitsas, speaking on MSNBC's Countdown last night, had the perfect suggestion. "Well, it wouldn't be Costa Rica, but I'll tell you, what would probably work—I think Somalia would be great for Rush.  I mean, it's a libertarian paradise.  Everybody has guns.  There's not much of a government.  There sure as heck isn't government-run health care. So, I think, if you're talking about Rush's world view, I can't imagine a better place than Somalia—as long as he can find himself a nice $20 million pad in Mogadishu."

Dittos, Markos!


 

The Regressiveness of Health Premiums

Health insurance premiums are unlike the cost of other forms of insurance that each of us carries. The price of most insurance we buy is progressive, that is, related to our income. We usually buy life insurance as a multiple of our income, so if we earn more, we buy more, and pay more. If we earn less, we buy less, and pay less. Our home owner's insurance is related to the value of the property we are insuring. If we have a large home, we buy more coverage. If we have a modest home, our coverage needs and costs are lower. Our automobile insurance needs are related to the value of the car we are insuring, and our own driving record, items that are related to our income, in the first case, and under our control, in the second. If we buy disability insurance, its cost is related to the income we are protecting, and our age.

Health insurance costs, however, are regressive. They are inversely related to income. It costs as much to do open heart surgery on a man who earns the minimum wage, as it costs to operate on a Goldman Sachs executive. The operation consumes several years' worth of the income of the minimum wage earner, but only a tiny fraction of the year-end bonus of the Wall Street executive. As a result the health premiums that protect against these costs are regressive too.

Fatally Uninsured

A Harvard Medical School and Cambridge Health Alliance study finds that the deaths of nearly 45,000 Americans each year was associated with a lack of health insurance coverage. That is a number that is 10 times the number of U. S troops killed in the Iraq War -- since it began in March 2003! It is greater than the number of Americans killed in traffic accidents in all 50 states in a calendar year. It is a tragedy that the wealthiest country in the world, the most powerful nation on the Earth, would allow this to happen to its people. It is far past the time when we need to pass the health reform legislation that will help all Americans get the healthcare coverage that we all need.

We will have spent over three trillion dollars fighting the wars in Afghanistan and Iraq, because 3,497 Americans we killed by terrorists on September 11, 2001. Yet we allow almost 13 times that number to die every year because of the commercial actions of insurance companies who deny coverage, enforce exclusions from coverage for pre-existing conditions, rescind policies of beneficiaries who have been paying health premiums, and price healthcare out of reach for more American families. We must act now to pass health reform, so we can end these abusive practices and this tragic loss of American lives!

Sen. Conrad on Reconciliation

Senator Kent Conrad, (D-ND) chairman of the Senate Budget Committee, writes on the role of reconciliation in today's Washington Post. He points out that reconciliation is not being used to pass health reform. Health reform passed the Senate following the usual tortured process with 60 votes. Reconciliation is being used to pass a "fixer" bill that will clean up mistakes, like Nebraska's windfall Medicare match.

He points out that reconciliation has been used many times, including times in which the impact on the Federal deficit was significant -- the 2001 and 2003 tax cuts which resulted in increases in the deficit of $1.3 trillion and $350 billion respectively. The planned use of reconciliation to amend the health reform package will reduce the deficit by $130 billion over the next 10 years, and by $1.3 trillion between 2020 and 2030, according to Congressional Budget Office estimates.

Another Look at the Cost of Delay

Billy Roy, M.D., a retired physician and former member of Congress representing Kansas, writes an excellent piece on why we need to move forward on healthcare reform.  He points out the significant costs of not passing health reform that I wrote about in The Cost of Delay.  In 1973, he co-sponsored President Nixon's health reform proposal.  Using data from the Commonwealth Fund, he points out that our health costs would be a lot closer to those of most other industrial nations if we had passed that legislation.  Imagine if we had another six or seven percent of GDP available to pay down our debt, or improve education, or finish digging out from the Great Recession.  He argues that we will have problems in healthcare until we decide, as other nations have, that healthcare should be provided privately, but financed and administered publicly.  He also points out that the reform proposed is not a government takeover of the health care industry.  The insurance industry and their lobbyists will do just fine if reform passes or fails.  You can read his thoughtful piece here.

What Health Reform Does in 2010

The President's weekly address today is devoted to the health care reform debate.  He lays out the immediate benefits to small business, individuals, those covered by Medicare, and those uninsured because of pre-existing conditions. If the bill is passed, these are benefits that will take effect this year.  Federal subsidies to help with the cost of insurance premiums for low and middle income taxpayers and the development of the insurance exchanges, where we'll be able to choose from a range of qualified benefit plans from many health insurers will come later.  The full text of the address is provided after the jump. 

Risk Pool to Cesspool

Enormous premium increases of 25 to 40 percent announced by Anthem Blue Cross in California and Anthem Blue Cross and Blue Shield in Ohio, both units of Wellpoint, Inc., a health insurer with 33.7 million members across the country, have drawn newspaper stories and public outrage. In both cases, Anthem has cited soaring healthcare costs as part of the explanation for these premium increases.

But a look at healthcare costs shows that they play only a tiny role in hikes of these magnitudes. The U. S. Department of Labor's Bureau of Labor Statistics shows only modest increases in health costs during the past year. Anthem is attempting to put in place rate increases three to 12 times greater than the increase in medical costs.  "Soaring" describes Anthem's premium increases, not actual healthcare costs.

Component	Rate of Increase (Jan 2009 - Jan 2010)
Medical Care	3.9%
Medical Care Commodities	3.9%
Medical Care Services	3.9%
Professional Services	3.1%
Hospital and Related Services	7.6%

The King Has No Clothes

The way we finance healthcare does not work well for all American's because it's not a system that was designed to work for all Americans. This is evident in the plethora of health plans, some large, some small, most group plans, but with a few individual plans, most private, several government-sponsored, with different eligibility requirements, different benefits, different waiting periods and exclusions, widely different administrative expenses, ranging from less than the four percent spent to administer Medicare, to the 30 percent of premium spent to administer an individual health plan. Despite decades of lip-service to the concept that healthcare in America is a right, we still have no universal plan to guarantee the financial protection needed to make that right a reality.

The public/private system that has evolved to finance health care is not the result of the best minds in America planning thoughtfully for the needs of all of the American people. It is largely an accident of history, where each step has been taken to address some subset of the population: The poor and the elderly in the mid-60's; those who are between jobs in the mid 80's; uninsured children in the mid-90s, prescription drugs for the elderly in 2003.

Why Care About the Uninsured?

Most of us have health insurance coverage, so why care about those who don't? There are several reasons why Americans who have health insurance should worry about the very real costs and dangers we face as a result of living with 46.3 million Americans who don't have health insurance coverage.

A January 2004 report by the Institute of Medicine of the National Academies entitled, Insuring American's Health: Principles and Recommendations illustrates some of the problems and costs resulting from this societal problem. I have provided comments from this report, which appear in italics, interspersed with my own thinking in ordinary type.

On average, people who are uninsured for a full year pay 35 percent of the overall cost of their medical care.

The roughly $35 billion for uncompensated care provided to uninsured individuals is comprised of $23.6 billion in patients' unpaid hospital bills, $7.1 billion in public expenditures for government grant and direct service programs (e.g. Veterans Affairs, Indian Health Services, Health Resources and Services Administration programs, local health departments) and $5.1 billion in free or reduced cost care provided by office-based physicians and through volunteer service in clinics.

Dear Senator Johanns

Senator Mike Johanns (R-NE) sent an email message to those who have communicated with him.  In the message, he outlined the reasons why majority rule and an up or down vote on healthcare is a dangerous thing. This was my caustic reply.

You are badly misreading the American public if you believe we have turned against healthcare reform.  Large majorities of Americans want an end to pre-existing condition exclusions and rescissions.  To do that requires all of us to be covered. Universal coverage requires subsidies for those who cannot afford coverage.  America needs the health reform bill to become law.   My friend (name redacted) needs the health reform bill to become law.  Her COBRA coverage expires in September.  She is currently being treated for thyroid cancer, and is out of work.  She has no prospects for being able to buy individual health insurance at the age of 57 with a cancer history, even though she has had health insurance for her entire life.  America can do better than leave a 57 year old woman with cancer uncovered when she is most in need of coverage.

We desperately need to slow the growth in healthcare spending, which, as Warren Buffett has pointed out clearly, is making our nation uncompetitive in the world.  All of our competitors have much lower health costs as a percentage of Gross Domestic Product (GDP).  We spend more than anyone else in the world (17% of GDP) to have the 37th best health system in the world, which is not as good as Costa Rica, and is only incrementally better than Slovenia. Meanwhile, Japan, with the 10th best health system in the world spends only 8.2% of GDP on healthcare; Germany, with the 25th best health system spends but 10.7% of GDP on healthcare, the United Kingdom, with the 18th best health system spends only 8.2% and France, with the world's best healthcare spends only 11.2% of GDP on health.   Healthcare costs are a cancer that is destroying our ability to compete in the world, and to recover from the Great Recession.

The Republican Party is standing in the way of what is best for America. So I completely disagree with your party-fed talking points that reconciliation is a bad way to pass refinements to healthcare reform. In case you have been asleep, the bill passed the Senate on December 24.  All that remains is to reconcile differences between the House and Senate versions.  Since that involves primarily financial issues, it is a completely acceptable way to deal with the intransigence of the Republican Party. 

I fully support reconciliation as an effective means to get health reform passed.