The Commonwealth Fund has come out with an informative transnational comparison of health care systems. Despite its name, this Fund is not a financial entity. In its own words, it is a:
private foundation that aims to promote a high performing health care system that achieves better access, improved quality, and greater efficiency, particularly for society's most vulnerable, including low-income people, the uninsured, minority Americans, young children, and elderly adults.
(www.commonwealthfund.org/About-Us.aspx)
The main Report discussed herein is "Mirror, Mirror on the Wall: How the Performance of the U.S. Health Care System Compares Internationally; 2010 Update".
The findings reflect poorly on America. This post will summarize some of the information therein. Follow-up posts will explore how America can do better, with some discussion of the recently-passed health care reform bill but with emphasis on new, independent thinking on health and health care economics.
All interested parties should read the Fund's report, either in full as linked above or the Summary.
The report compares various measured outcomes for the U. S. healthcare system against six other countries, most of them English-speaking: Australia, the U. K., Canada and New Zealand; plus Germany and the Netherlands. Similar comparisons in 2004, 2006 and 2007 showed the U. S. was last in all measured categories, as was also found in this year's report.
These results were quality of care, access, efficiency, equity, life span and cost.
Another Commonwealth Fund report on a similar trans-national comparison of health care from June of this year called Measuring the U.S. Health Care System: A Cross-National Comparison. One of the key findings in this related report is:
The U.S. has a comparatively low number of hospital beds and physicians per capita, and patients in the U.S. have fewer hospital and physician visits than those in most other countries.
This report finds that the U. S. has about 27% fewer practicing physicians per capita than the average for 30 OECD countries. It is my sense that this problem, and the related problem of shortages of nurses, is the most fundamental important healthcare problem we have. It takes a long time and a lot of money to bring doctors into the workforce. Even if physician salaries shrink in inflation-adjusted terms as their supply increases in regard to population, total healthcare spending will tend to rise as more patients get seen and evaluated. In other words, an issue not (in my view) satisfactorily addressed by the recent health care legislation is the conflict between the stated goal of "bending" the healthcare cost curve while simultaneously treating more people and educating more and more physicians. The DoctoRx preferred solution is to say openly that the basic goal of the legislation, that of better health of the population, is inherently costly and that the goal of increasing efficiency and decreasing costs is not easy to achieve, and that society therefore should be ready to commit an even greater proportion of its resources to health care than it currently does should efforts to control health care spending not meet projections. Otherwise we may end up with Ponzi/fraudulent economics in this regard.
Back to the theme of the main report.
Numerous other organizations such as the World Health Organization have studied other countries such as Japan, Italy and Spain and have shown similar findings. There is thus little doubt that for the stated criteria, America will benefit from improvement. Of course, the devil is in the details. Here are some of the findings of the Commonwealth Fund's report and some of its own commentary, including the following cautionary language (Sec. 1; vii):
Any attempt to assess the relative performance of countries has inherent limitations. These rankings summarize evidence on measures of high performance based on national mortality data and the perceptions and experiences of patients and physicians. They do not capture important dimensions of effectiveness or efficiency that might be obtained from medical records or administrative data. Patients’ and physicians’ assessments might be affected by their experiences and expectations, which could differ by country and culture.
And that is followed by a statement that stems from a particular viewpoint:
Disparities in access to services signal the need to expand insurance to cover the uninsured and to ensure that all Americans have an accessible medical home.
Re the last statement, a different report using the same data and similar public health motives might for example have said:
Disparities in access, which are largely limited to the least affluent members of society, call for free medical care for all of limited means for serious health conditions and heavily discounted care for milder conditions.
Or even more broadly:
The fact that the U. K. is #2 in overall rating amongst the 7 countries studied means that the U. S. should consider adopting its system in which all medical care is provided by the State paid for out of general revenues, with private insurance purchasable if desired, as in the United Kingdom.
In other words, the call for everyone to have "insurance" is a political one. Also, further on in that statement is the vaguer assertion that all Americans should have an "accessible medical home". What does that mean? If it is asserting that everyone should have a primary care doctor, why not say that?
"Accessible medical home" is jargon, but this is a report for the public. Is Commonwealth saying that even the homeless should have a medical home, whatever that is? What about itinerant workers, such as agricultural workers who move from south to north, or golf caddies who do the same thing?
Commonwealth is more than entitled to its own point of view, and I am not commenting on said point of view either positively or negatively. My point is that it would have been optimal in my opinion if there were a clear separation of Commonwealth's policy recommendations from the factual report. After all, advocacy groups such as Commonwealth may present data selectively, and when an organization with a goal, no matter how public-spirited, puts out a report that it wishes to be accepted as fully accurate, it helps its cause when said report meets the highest possible standards of objectivity and peer review.
Let us discuss an economic topic the report addresses, that of spending on health per capita.
We're #1 on that one!
Per capita U. S. spending on health care was $7290 per person, triple that for New Zealand (the lowest spender of the seven countries).
This statistic is worth thinking about at least a bit before passing judgment on it as a sign that something is rotten in the U. S., though it is of course troubling that the U. S. spends more than it needs to achieve mediocre outcomes.
For example, say that in the U. S., surgeons rate highly on per hour compensation, and plumbers much less highly (not so true, but let's assume). And let's say that said ratio of incomes is much more equal in New Zealand (which is the case). Does that necessarily call for "reform", and in which country should the reform occur? Again, the answer is political-economic; there is no absolute right or wrong. In other words, surgeons in the U. S. have relatively higher incomes than in New Zealand or Germany compared to other workers. Is this a bad thing? Might we also say that New Zealand is not getting good value from its plumbers?
If you're a doctor, it's a good thing to be paid more rather than less. Given the relative shortage of doctors in America as described above, it's not a surprise that their income is relatively higher than in countries where they are more plentiful. Overall, is the societal wealth pie changed if doctors are higher or lower on the financial income scale? I'm not sure.
But of course the above point is only part of the problem. I mention it because it is always important to think critically. The Commonwealth Fund points out how deficient the U. S. "system" is on efficiency and related problems, including health information. When one talks inefficiency, one is now talking real costs, both financial and health-related.
One would think that given its global leadership in information technology, the U. S. would be a leader in medical data-sharing and individual data storage. The potential for this to improve quality and efficiency of care in a mobile population is large, but the U. S. ranks last in this study. Assuming more than adequate levels of privacy are ensured, there is great therapeutic and research potential from portable individual data that can also be aggregated for analysis.
Sadly, the U. S. ranks last on efficiency in the Commonwealth report. So much for Yankee ingenuity. (The U. K. ranked first.)
The U. S. also ranked last on "equity". Not good, obviously, and clearly this relates to wealth differences and associated demographic factors. Something "must" be done. It is unknown how healthcare legislation will play out; the U. K. was 2nd in equity, but the Netherlands and New Zealand have not dissimilar systems to each other in some ways but were ranked #1 and #6 respectively in that category. In other words, it may not be that one system is better than another but how they are funded and implemented.
In addition to having a relative physician shortage and probably an even larger shortage of primary care physicians, my major criticism of the U. S.'s current system is that there is no system. There are so many different types of healthcare insurance in the U. S. ranging from universal and nearly or totally free (military), to subsidized privately-funded healthcare (employer-paid and other), subsidized universal coverage by age and disability (Medicare), subsidized by income (Medicaid), and cash payers that there there is no system. It is messy, unfair, inefficient and costly.
The reader may wish to think about whether the healthcare legislation signed into law this year adequately addresses this issue. My sense is that it does not and therefore it has a serious structural deficiency, and that therefore this entire topic may be addressed in the future. I believe that all the other six countries to which the U. S. is compared in the report have coherent systems of universal coverage but with different models including single-payer Medicare-type to insurance companies acting as nonprofit pass-through entities to fairly pure socialism. But everyone is covered for life in one system they get to know and that has maximum advantages of scale. Is it possible that the U. S. ranks at the bottom in good measure simply because of its messy melange of different types of coverage and that the key legislative move would have been to simplify matters as is the case in the other countries studied?
Before concluding, I would like to note that other experts have specific points they have raised in defense of American healthcare. For example, certain cancer treatment statistics favor America over many other advanced countries. Other ways to slice and dice the data for other political reasons break down American healthcare by insured/uninsured status and in other ways, and show (or purport to show) that if you have good insurance in America and are well-educated, there may be no better a place to live re health care. An argument coming from this point of view was to leave the healthcare system largely intact and focus on incremental improvements.
In any case, barring the unlikely event of repeal of said legislation, what is pending is implementation.
Stay tuned.
Copyright (C) Long Lake LLC 2010
Showing posts with label healthcare reform. Show all posts
Showing posts with label healthcare reform. Show all posts
Sunday, July 18, 2010
Saturday, May 8, 2010
Wishing the Times Were NOT So Interesting
The non-permabears I follow who were bearish in 2008 and perhaps 2007 and bullish for most or all of the up-move in stocks, are growling again. This blog has been growling as well for at least 2 weeks and has pointed out for months that stocks are fundamentally overvalued at almost record levels by two different measures, "q" and cyclically-adjusted P/E. Now that systemic contagion occurred with the famous meltdown last week, yours truly simply does not want to be in the U. S. equity markets. ETFs that own gold and foreign currencies are OK still, though some of them hit air pockets in the sell-off as well.
Charts tell the tale. The move up from the 2009 low was lengthy but the angle of the ascent was much weaker than the angle of the descent. If stocks were undervalued, they would laugh at Greek debt problems.
Given our wildly over-financialized economy, falling stocks will have an adverse feedback effect on the real economy. This is what happens when the powers that be try to revive "animal spirits" by printing money.
The problems we have with financial and monetary policy are worse than the excessive debt loads carried at all levels of society. They include lies such as those to Social Security recipients that it's your money, you paid in, you earned it, etc., disguising the pay-as-you-go nature of the scheme. We now have another lie in Obamacare, which passed due to almost certainly fraudulent assumptions such as that the Congressionally-mandated major cuts in Medicare physician reimbursement will finally occur and the pseudo-fraudulent tactic of providing years of tax increases before the costs really kick in.
Most of the country sees through the charade but can do nothing The time for real financial reform was a year ago, when Big Finance was on its knees. Instead Obama focused on remaking the U. S. health care system years from now. What a genius! Let the fire smolder while getting architectural plans for a major extension to the house. Helping Big Finance get on its feet was an essential part of the strategy that guaranteed that real reform would not occur.
The current Greek tragedy is small beer compared to what could come in the New World. Short-term, though, stocks are oversold. But they are too high. Treasuries may be over-bought. But there is no reported net inflation. Thus yields may arguable be too high. Interesting times, to say the least.
Copyright (C) Long Lake LLC 2010
Charts tell the tale. The move up from the 2009 low was lengthy but the angle of the ascent was much weaker than the angle of the descent. If stocks were undervalued, they would laugh at Greek debt problems.
Given our wildly over-financialized economy, falling stocks will have an adverse feedback effect on the real economy. This is what happens when the powers that be try to revive "animal spirits" by printing money.
The problems we have with financial and monetary policy are worse than the excessive debt loads carried at all levels of society. They include lies such as those to Social Security recipients that it's your money, you paid in, you earned it, etc., disguising the pay-as-you-go nature of the scheme. We now have another lie in Obamacare, which passed due to almost certainly fraudulent assumptions such as that the Congressionally-mandated major cuts in Medicare physician reimbursement will finally occur and the pseudo-fraudulent tactic of providing years of tax increases before the costs really kick in.
Most of the country sees through the charade but can do nothing The time for real financial reform was a year ago, when Big Finance was on its knees. Instead Obama focused on remaking the U. S. health care system years from now. What a genius! Let the fire smolder while getting architectural plans for a major extension to the house. Helping Big Finance get on its feet was an essential part of the strategy that guaranteed that real reform would not occur.
The current Greek tragedy is small beer compared to what could come in the New World. Short-term, though, stocks are oversold. But they are too high. Treasuries may be over-bought. But there is no reported net inflation. Thus yields may arguable be too high. Interesting times, to say the least.
Copyright (C) Long Lake LLC 2010
Wednesday, March 10, 2010
Health Care Reform Now?
I woke up this morning thinking that the odds have to favor the President here. No matter that he and his party just have not made the case to the American people. Raw party politics can trump that. Then I saw his worst numbers yet coming from Rasmussen Reports, which while a nominally Republican-oriented firm, has a very good track record of accuracy no matter which way the political winds blow.
From polling posted today, Rasmussen Daily Presidential Tracking Poll, here are highlights:
The Rasmussen Reports daily Presidential Tracking Poll for Wednesday shows that 22% of the nation's voters Strongly Approve of the way that Barack Obama is performing his role as President. Forty-three percent (43%) Strongly Disapprove giving Obama a Presidential Approval Index rating of -21. That matches the lowest Approval Index rating yet recorded for this President.
Forty-two percent (42%) of Democrats Strongly Approve while 72% of Republicans Strongly Disapprove. Among those not affiliated with either major political party, 17% Strongly Approve and 45% Strongly Disapprove. . .
Overall, 43% of voters say they at least somewhat approve of the President's performance. That, too matches the lowest level yet recorded for this President. Fifty-six percent (56%) disapprove.
From polling posted today, Rasmussen Daily Presidential Tracking Poll, here are highlights:
The Rasmussen Reports daily Presidential Tracking Poll for Wednesday shows that 22% of the nation's voters Strongly Approve of the way that Barack Obama is performing his role as President. Forty-three percent (43%) Strongly Disapprove giving Obama a Presidential Approval Index rating of -21. That matches the lowest Approval Index rating yet recorded for this President.
Forty-two percent (42%) of Democrats Strongly Approve while 72% of Republicans Strongly Disapprove. Among those not affiliated with either major political party, 17% Strongly Approve and 45% Strongly Disapprove. . .
Overall, 43% of voters say they at least somewhat approve of the President's performance. That, too matches the lowest level yet recorded for this President. Fifty-six percent (56%) disapprove.
Rasmussen has noted that the President's popularity has bottomed several times after he has made a big push on health care, including last summer and then after his health care speech to Congress.
Is this worsening polling data enough to prevent party discipline and all the goodies that come with going with leadership enough to prevent the House from approving the Senate bill?
Much would appear to ride on the outcome both for America and for the economy.
Copyright (C) Long Lake LLC 2010
Tuesday, March 9, 2010
On an Open Letter to the President Re Healthcare and Economics
An Open Letter to President Obama at Cafe Hayek is quite the witty rejoinder to a key part of the Democratic Party's core argument for healthcare reform. It's brief enough to simply copy:
Dear Mr. Obama:
CBS radio news this morning ran a clip of one of your recent speeches. In it, you criticize insurance companies because they “ration coverage … according to who can pay and who can’t.”
My first thought was “not exactly; coverage is rationed according to who pays and who doesn’t.” Ability to pay isn’t the same thing as actually paying, and what insurers care about is the latter. Many folks – especially young adults – have the ability to pay but choose not to do so. They get no coverage.
But further pondering of your point leads me to look beyond such nit-picking to see fascinating possibilities. Not only insurers, but all producers who greedily refuse to supply persons who don’t pay should be set aright. Now I’m sure that you don’t ration the supply of the books you write according to any criteria as sordid as requiring people actually to pay for them. But our society is full of people less enlightened than you.
For example, the typical worker rations his labor services according to who pays and who doesn’t. That must stop. Oh, and supermarkets! Every single one rations groceries according to who pays. Likewise with restaurants, clothing stores, home-builders, furniture makers, even lawyers! You name it, rationing is done according to who pays. Indeed, my own county government has been corrupted by this greedy attitude: if I don’t pay my taxes, the sheriff takes my house – effectively booting me out of the county merely because I didn’t pay for its services.
Preposterous!
I look forward to your changing this selfish and unfair system of rationing that for too long now has kept Americans impoverished.
Sincerely,
Donald J. Boudreaux
Professor of Economics
George Mason University
Fairfax, VA 22030
Whatever one's position is on healthcare as a right and various legislative details, the Professor has a point.
Politically, the President attacks insurance companies, suggesting they are low-life entities. Why, then, did he not fight for the "public option"? Why does he fight so hard for a law that forces all Americans to become clients of these same insurance companies?
If we're going to have socialized medicine- where the points Dr. Boudreaux would not apply just as our socialized armed forces protect all citizens regardless of whether they pay taxes or not- then why not go Canadian or British and just have government do it?
Methinks this contradiction of complaining about private companies acting as they are supposed to act--to maximize profits-- and then empowering them to take massive amounts of our money supposedly for the greater good-- is part of the President's problem on healthcare. It's a hybrid public-private non-partnership in which Washington holds all the trump cards.
Copyright (C) Long Lake LLC 2010
Dear Mr. Obama:
CBS radio news this morning ran a clip of one of your recent speeches. In it, you criticize insurance companies because they “ration coverage … according to who can pay and who can’t.”
My first thought was “not exactly; coverage is rationed according to who pays and who doesn’t.” Ability to pay isn’t the same thing as actually paying, and what insurers care about is the latter. Many folks – especially young adults – have the ability to pay but choose not to do so. They get no coverage.
But further pondering of your point leads me to look beyond such nit-picking to see fascinating possibilities. Not only insurers, but all producers who greedily refuse to supply persons who don’t pay should be set aright. Now I’m sure that you don’t ration the supply of the books you write according to any criteria as sordid as requiring people actually to pay for them. But our society is full of people less enlightened than you.
For example, the typical worker rations his labor services according to who pays and who doesn’t. That must stop. Oh, and supermarkets! Every single one rations groceries according to who pays. Likewise with restaurants, clothing stores, home-builders, furniture makers, even lawyers! You name it, rationing is done according to who pays. Indeed, my own county government has been corrupted by this greedy attitude: if I don’t pay my taxes, the sheriff takes my house – effectively booting me out of the county merely because I didn’t pay for its services.
Preposterous!
I look forward to your changing this selfish and unfair system of rationing that for too long now has kept Americans impoverished.
Sincerely,
Donald J. Boudreaux
Professor of Economics
George Mason University
Fairfax, VA 22030
Whatever one's position is on healthcare as a right and various legislative details, the Professor has a point.
Politically, the President attacks insurance companies, suggesting they are low-life entities. Why, then, did he not fight for the "public option"? Why does he fight so hard for a law that forces all Americans to become clients of these same insurance companies?
If we're going to have socialized medicine- where the points Dr. Boudreaux would not apply just as our socialized armed forces protect all citizens regardless of whether they pay taxes or not- then why not go Canadian or British and just have government do it?
Methinks this contradiction of complaining about private companies acting as they are supposed to act--to maximize profits-- and then empowering them to take massive amounts of our money supposedly for the greater good-- is part of the President's problem on healthcare. It's a hybrid public-private non-partnership in which Washington holds all the trump cards.
Copyright (C) Long Lake LLC 2010
Tuesday, March 2, 2010
Not So Simple as a Simple Majority
The conservative publication National Review must be enjoying compiling a list of quotes on using "reconciliation" to get healthcare reform legislation through the Senate following the election of Scott Brown '41' as Massachusetts Senator. Here is the final quote:
“You know, the Founders designed this system, as frustrating [as] it is, to make sure that there's a broad consensus before the country moves forward. . . . And what we have now is a president who . . . [h]asn’t gotten his way. And that is now prompting, you know, a change in the Senate rules that really I think would change the character of the Senate forever. . . . And what I worry about would be you essentially have still two chambers — the House and the Senate — but you have simply majoritarian absolute power on either side, and that’s just not what the founders intended” (Sen. Barack Obama, Ill., remarks at the National Press Club, 4/26/05).
There probably is a broad national consensus on certain aspects of potential change in the system. There is no consensus on the basic concept that the Federal government should control health insurance to see that it is as comprehensive - - i.e. expensive-- as the government mandates. What if the government were to mandate that no new car less than $35,000 could be purchased? It would argue that all the safety and convenience features meant that this really was not a more expensive car. It would further subsidize selected purchasers based on arbitrary and changeable criteria.
I have long felt that there are two critical areas needing reform. One is a safety net for catastrophic healthcare costs. Bill Clinton was advised that this could be put into place for the cost of "sin taxes" on tobacco and alcohol. Such an approach likely would have been wildly popular. Instead he went for a massively complicated approach that made it illegal to go outside the referral system, a la Canada. This approach would still be popular.
The other is more technical. It relates to the list and real prices by health care facilities, and to a lesser extent doctors, for their services. For example, the real cost of providing a multi-channel automated blood analysis might be a dollar or two. The retail price might be a hundred dollars or much more, and people without insurance are billed the full amount. However, if one has managed care insurance, the insurer knows the real costs and pays an appropriate profit for the analysis of the blood. Similar things go on with radiology services, general hospital care, and the like.
It would be easy to make it illegal to charge the uninsured more than a certain percentage above what a provider of health services willingly accepts from an insurer for a service. As is now stands, insurers have a scam. They can overcharge because almost everyone is terrified of being charged retail for even a short hospital stay. This is a form of 'protection' little different from small shopkeepers being 'protected' by whomever wants to extort money from them.
Here's the bigger picture. The government is already subsidizing health care massively, through tax deductions for employer-paid health care, through Medicare and Medicaid, and in lesser ways. The government is in horrible financial shape in good measure because of its decisions in 2008 that are ongoing to socialize the losses from the housing collapse. Tied into but not only related to housing, the large financial companies have been massively subsidized and Fed policy is continuing this implicit subsidy. The auto industry has been subsidized, as well.
The Federal government's own actuaries report that the current value of the unfunded promises the government has made to its own people are over $50 Trillion, and rising.
How on earth is this the correct time to create a new entitlement for first-quality health care?
It is a great goal that we all favor as people, actual or potential patients, and in my case as a physician.
The problem is that few people believe that the government really can fulfill all its current promises. Remember that Social Security is another worthy concept. This entitlement is not, however, first-quality. Try retiring on nothing but Social Security payments. Medicaid is not first-quality.
The idea that the powers that be in Washington are truly going to be able to deliver the quality of care that most Americans now get--courtesy of the healthcare industry and via heavy subsidies already-- but for more Americans and with the incentive to buy votes by increasing benefits-- is a dubious idea. The American people look at the rising cost and decreasing quality of the Postal Service, the fact that the head of the Ways and Means Committee and the Treasury Secretary feel that compliance with the rules don't apply to them, and want an incremental approach to improve the current system.
As Senator Obama said in 2005, major social legislation has, at least beginning with FDR, always had large majorities in favor both in public polling and in the Senate. This legislation, which is so personal, should be much more popular before it is enacted.
The public would have much preferred a jobs summit over a healthcare summit.
While large states such as California, New York and Illinois are in serious financial distress, a tone-deal majority in Washington is focused on expanding Federal power. Expansion of Federal power in the housing field, however, has had miserable long-term consequences. That should be a caution for a President who is (ineffectively) dealing with the fallout from that expansion of responsibility.
Most Americans share similar goals re health insurance. Most Americans also want government to engage in effective actions that both keep the government financially sound while allowing economic activity to rebound in a self-sustaining, balanced manner.
America is faltering largely because of internal economic and financial follies, both in the "free enterprise" system and in government. Make no mistake about it. The current depressed and fragile economy did not have to occur.
It was caused by such matters as lies, looting and corruption.
As JFK said, a rising tide lifts all boats. Barack Obama needs to channel Bill Clinton's 1992 campaign. It's all about the economy. Without a durable and strong economic expansion, government will simply not be able to deliver on his goals for high quality health insurance for all Americans, at least not without sacrifice in other sectors of the economy for which the public is completely unprepared.
Insurance is an after-the-fact thing. Fire insurance on a house only kicks in after the event has happened. If Americans ate "right", exercised, and abjured tobacco, they would be doing more good than any insurance scheme can do.
Mr. President, please focus your attention on the economy and national security. That dual focus made Ronald Reagan so successful also in difficult times. Please start over on health care reform and you can have popular legislation enacted by August, in time to help your party in the midterms.
And please set a example by joining the ranks of ex-smokers.
Copyright (C) Long Lake LLC 2010
“You know, the Founders designed this system, as frustrating [as] it is, to make sure that there's a broad consensus before the country moves forward. . . . And what we have now is a president who . . . [h]asn’t gotten his way. And that is now prompting, you know, a change in the Senate rules that really I think would change the character of the Senate forever. . . . And what I worry about would be you essentially have still two chambers — the House and the Senate — but you have simply majoritarian absolute power on either side, and that’s just not what the founders intended” (Sen. Barack Obama, Ill., remarks at the National Press Club, 4/26/05).
There probably is a broad national consensus on certain aspects of potential change in the system. There is no consensus on the basic concept that the Federal government should control health insurance to see that it is as comprehensive - - i.e. expensive-- as the government mandates. What if the government were to mandate that no new car less than $35,000 could be purchased? It would argue that all the safety and convenience features meant that this really was not a more expensive car. It would further subsidize selected purchasers based on arbitrary and changeable criteria.
I have long felt that there are two critical areas needing reform. One is a safety net for catastrophic healthcare costs. Bill Clinton was advised that this could be put into place for the cost of "sin taxes" on tobacco and alcohol. Such an approach likely would have been wildly popular. Instead he went for a massively complicated approach that made it illegal to go outside the referral system, a la Canada. This approach would still be popular.
The other is more technical. It relates to the list and real prices by health care facilities, and to a lesser extent doctors, for their services. For example, the real cost of providing a multi-channel automated blood analysis might be a dollar or two. The retail price might be a hundred dollars or much more, and people without insurance are billed the full amount. However, if one has managed care insurance, the insurer knows the real costs and pays an appropriate profit for the analysis of the blood. Similar things go on with radiology services, general hospital care, and the like.
It would be easy to make it illegal to charge the uninsured more than a certain percentage above what a provider of health services willingly accepts from an insurer for a service. As is now stands, insurers have a scam. They can overcharge because almost everyone is terrified of being charged retail for even a short hospital stay. This is a form of 'protection' little different from small shopkeepers being 'protected' by whomever wants to extort money from them.
Here's the bigger picture. The government is already subsidizing health care massively, through tax deductions for employer-paid health care, through Medicare and Medicaid, and in lesser ways. The government is in horrible financial shape in good measure because of its decisions in 2008 that are ongoing to socialize the losses from the housing collapse. Tied into but not only related to housing, the large financial companies have been massively subsidized and Fed policy is continuing this implicit subsidy. The auto industry has been subsidized, as well.
The Federal government's own actuaries report that the current value of the unfunded promises the government has made to its own people are over $50 Trillion, and rising.
How on earth is this the correct time to create a new entitlement for first-quality health care?
It is a great goal that we all favor as people, actual or potential patients, and in my case as a physician.
The problem is that few people believe that the government really can fulfill all its current promises. Remember that Social Security is another worthy concept. This entitlement is not, however, first-quality. Try retiring on nothing but Social Security payments. Medicaid is not first-quality.
The idea that the powers that be in Washington are truly going to be able to deliver the quality of care that most Americans now get--courtesy of the healthcare industry and via heavy subsidies already-- but for more Americans and with the incentive to buy votes by increasing benefits-- is a dubious idea. The American people look at the rising cost and decreasing quality of the Postal Service, the fact that the head of the Ways and Means Committee and the Treasury Secretary feel that compliance with the rules don't apply to them, and want an incremental approach to improve the current system.
As Senator Obama said in 2005, major social legislation has, at least beginning with FDR, always had large majorities in favor both in public polling and in the Senate. This legislation, which is so personal, should be much more popular before it is enacted.
The public would have much preferred a jobs summit over a healthcare summit.
While large states such as California, New York and Illinois are in serious financial distress, a tone-deal majority in Washington is focused on expanding Federal power. Expansion of Federal power in the housing field, however, has had miserable long-term consequences. That should be a caution for a President who is (ineffectively) dealing with the fallout from that expansion of responsibility.
Most Americans share similar goals re health insurance. Most Americans also want government to engage in effective actions that both keep the government financially sound while allowing economic activity to rebound in a self-sustaining, balanced manner.
America is faltering largely because of internal economic and financial follies, both in the "free enterprise" system and in government. Make no mistake about it. The current depressed and fragile economy did not have to occur.
It was caused by such matters as lies, looting and corruption.
As JFK said, a rising tide lifts all boats. Barack Obama needs to channel Bill Clinton's 1992 campaign. It's all about the economy. Without a durable and strong economic expansion, government will simply not be able to deliver on his goals for high quality health insurance for all Americans, at least not without sacrifice in other sectors of the economy for which the public is completely unprepared.
Insurance is an after-the-fact thing. Fire insurance on a house only kicks in after the event has happened. If Americans ate "right", exercised, and abjured tobacco, they would be doing more good than any insurance scheme can do.
Mr. President, please focus your attention on the economy and national security. That dual focus made Ronald Reagan so successful also in difficult times. Please start over on health care reform and you can have popular legislation enacted by August, in time to help your party in the midterms.
And please set a example by joining the ranks of ex-smokers.
Copyright (C) Long Lake LLC 2010
Tuesday, February 23, 2010
Stealing in Plain View
In Miami city manager resigns amid money mess, the Miami Herald concludes an article focusing on Miami's financial mess with a point that is generalizable to the ongoing global financial crisis. It ends as follows:
But the salary the city's top bureaucrat is leaving behind illustrates a clear issue the next city manager must confront: Hernandez earns $329,000 a year in salary and benefits -- making him just the 10th highest paid employee in Miami.
In other words, the city was "stealing" in plain view, simply by overpaying public servants, who in addition to salary receive great benefits.
The above comment ignores whatever less legal shenanigans may have occurred. Little would surprise anyone who knows the Miami tradition.
By analogy, consider the Bloomberg.com report on the AIG bailout titled Secret AIG Document Shows Goldman Sachs Minted Most Toxic CDOs.
This discusses certain secret aspects of the underlying securities that AIG "insured" via writing "protection" on credit default swaps. It is alleged that Goldman Sachs and several other Big Finance companies were foresighted enough to purchase insurance on the worst of the CDOs that were created.
While all this happened in secret, the bailouts are an example of stealing in plain view.
The net result of government and Fed actions has been to impose huge liabilities on taxpayers in order to pay the Big Finance companies virtually 100 cents on the dollar for the CDOs while millions of homeowners default on their mortgages because the financial companies and the government created and sustained a housing bubble. The vast bailouts were largely done in the open, with slipppery and shifting rationales.
Certainly Miami can also provide rationale for its compensation packages, but neither they nor the bailouts pass the sniff test.
We now may be seeing a similar thing with healthcare "reform". While not giving a whit about fighting for the "public option", Barack Obama and the Democrats appear to be going the route of "reconciliation" in the Senate so that they can give more business to insurance companies. That they are doing this just a few years after praising the filibuster and decrying reconciliation when the Republicans controlled the Senate is obviously less important to them than attaining/consolidating Federal control over the insurance industry and one-sixth of the economy in general.
It would be one thing if public polls consistently showed 3:2 support for Mr. Obama's plan. In fact, I believe that all major polls show the public is against it. In what is supposed to be a representative democracy, why is this particular legislation so important to fly in the face of Senate tradition when doing so is clearly against the public will?
In Miami and in finance, money is the ultimate measure of success. In the Federal government, that measure of success is power. The era of Bigger Government is here. The Feds are "stealing" power in plain sight.
Copyright Long Lake LLC 2010
But the salary the city's top bureaucrat is leaving behind illustrates a clear issue the next city manager must confront: Hernandez earns $329,000 a year in salary and benefits -- making him just the 10th highest paid employee in Miami.
In other words, the city was "stealing" in plain view, simply by overpaying public servants, who in addition to salary receive great benefits.
The above comment ignores whatever less legal shenanigans may have occurred. Little would surprise anyone who knows the Miami tradition.
By analogy, consider the Bloomberg.com report on the AIG bailout titled Secret AIG Document Shows Goldman Sachs Minted Most Toxic CDOs.
This discusses certain secret aspects of the underlying securities that AIG "insured" via writing "protection" on credit default swaps. It is alleged that Goldman Sachs and several other Big Finance companies were foresighted enough to purchase insurance on the worst of the CDOs that were created.
While all this happened in secret, the bailouts are an example of stealing in plain view.
The net result of government and Fed actions has been to impose huge liabilities on taxpayers in order to pay the Big Finance companies virtually 100 cents on the dollar for the CDOs while millions of homeowners default on their mortgages because the financial companies and the government created and sustained a housing bubble. The vast bailouts were largely done in the open, with slipppery and shifting rationales.
Certainly Miami can also provide rationale for its compensation packages, but neither they nor the bailouts pass the sniff test.
We now may be seeing a similar thing with healthcare "reform". While not giving a whit about fighting for the "public option", Barack Obama and the Democrats appear to be going the route of "reconciliation" in the Senate so that they can give more business to insurance companies. That they are doing this just a few years after praising the filibuster and decrying reconciliation when the Republicans controlled the Senate is obviously less important to them than attaining/consolidating Federal control over the insurance industry and one-sixth of the economy in general.
It would be one thing if public polls consistently showed 3:2 support for Mr. Obama's plan. In fact, I believe that all major polls show the public is against it. In what is supposed to be a representative democracy, why is this particular legislation so important to fly in the face of Senate tradition when doing so is clearly against the public will?
In Miami and in finance, money is the ultimate measure of success. In the Federal government, that measure of success is power. The era of Bigger Government is here. The Feds are "stealing" power in plain sight.
Copyright Long Lake LLC 2010
Monday, February 22, 2010
National Anthem
The NYT is reporting, Obama to Urge Oversight of Insurers' Rate Increases.
Apparently what has happened is that in part due to adverse selection, with an increasingly sick pool of potential and actual insureds, Anthem Blue Cross of California, has put into effect a 39% rate increase in its individual coverage.
The Times reports that half the states do not regulate health insurance rate increases, and California is one of them.
So, in an effort to add pizzazz to the faltering healthcare reform effort, the President is now proposing to Federalize state insurance programs, even though he has not agreed to Republican proposals to allow health insurance to be sold across state lines.
Maybe it would be better for the 25 states that do not now regulate rate increases to do so. I don't know why they don't, and maybe setting up a bureaucracy to do so would cost Californians more than it would save. Regulatory capture by the regulated industry is, after all, is the way of the world.
As if the Feds don't have enough to do, they now need to grow the government some more by getting directly involved in intrastate matters.
What happens with Anthem in California should stay in California. There's no need to go national.
If the Dems had simply worked matters out within the House and Senate caucuses, they could have come up with a reasonably popular proposal. Even if it were not "comprehensive", there's always tomorrow. Bill Clinton could certainly have pushed through a national healthcare reform to provide catastrophic health insurance to all Americans, paid for by "sin taxes" on alcohol and tobacco products. But he chose to go whole hog with a micromanaging plan that made it illegal to see the doctor of your choice if doing so violated the referral system. Well, that bill did not even get to a vote.
What we see in this last-minute maneuvering by the President is a desperate attempt to seize on a transitory issue of the day with no opportunity for the public to understand Anthem's rationale (which may be phony), put in a new Federal mandate that had no Congressional hearings, no time for comments by interested parties, no evaluation of costs vs. benefits, etc., in order to push through "reform" that has been rejected by Americans in poll after poll and was even the major issue causing, of all states, Massachusetts to give "Ted Kennedy's seat" to the 41st Republican vote in the Senate.
Major legislation should be bipartisan to be durable. Democratic initiatives such as Social Security, Medicare and major civil rights legislation all had significant Republican support. Health care should follow that pattern.
In the meantime, the Federal government is lurching from one financial crisis to another, with dishonest accounting for the housing bailouts and the pretense that its interventions do a net good to the economy. Rather, it is mainlining the opiate of more and more credit (borrowing and lending) into an addict that needs to detox.
Today on TV I saw an ad for mortgages from Lending Tree. It's easy to borrow from them, they say.
Except for lower housing prices and lots of pain, and a temporary retrenching in battered financial companies how much has fundamentally changed from the credit bubble of the aughties?
Answer: not enough.
Government at all levels have already taken on massive current responsibilities and even more massive future ones. This includes pension obligations at the state level as well as Medicare and Social Security unfunded Federal obligations.
The idea that an irresponsible Federal government should extend its powers and take on yet more responsibilities flies in the face of common sense. Let it show it can do things right with its current job before it gets a promotion.
The American people "get it". A recent WaPo poll showed that by 3:2, Americans prefer a Federal government that provides relatively fewer benefits in return for taxing and spending less. It's not a poll that Barack Obama can easily wriggle away from. Picking on an ancient issue of possibly excessive (how to define?) rate increases by insurers at the last minute in order to bring more power to Washington is the wrong way to govern and also is philosophically out of step with the people who elected him.
Copyright (C) Long Lake LLC 2010
Apparently what has happened is that in part due to adverse selection, with an increasingly sick pool of potential and actual insureds, Anthem Blue Cross of California, has put into effect a 39% rate increase in its individual coverage.
The Times reports that half the states do not regulate health insurance rate increases, and California is one of them.
So, in an effort to add pizzazz to the faltering healthcare reform effort, the President is now proposing to Federalize state insurance programs, even though he has not agreed to Republican proposals to allow health insurance to be sold across state lines.
Maybe it would be better for the 25 states that do not now regulate rate increases to do so. I don't know why they don't, and maybe setting up a bureaucracy to do so would cost Californians more than it would save. Regulatory capture by the regulated industry is, after all, is the way of the world.
As if the Feds don't have enough to do, they now need to grow the government some more by getting directly involved in intrastate matters.
What happens with Anthem in California should stay in California. There's no need to go national.
If the Dems had simply worked matters out within the House and Senate caucuses, they could have come up with a reasonably popular proposal. Even if it were not "comprehensive", there's always tomorrow. Bill Clinton could certainly have pushed through a national healthcare reform to provide catastrophic health insurance to all Americans, paid for by "sin taxes" on alcohol and tobacco products. But he chose to go whole hog with a micromanaging plan that made it illegal to see the doctor of your choice if doing so violated the referral system. Well, that bill did not even get to a vote.
What we see in this last-minute maneuvering by the President is a desperate attempt to seize on a transitory issue of the day with no opportunity for the public to understand Anthem's rationale (which may be phony), put in a new Federal mandate that had no Congressional hearings, no time for comments by interested parties, no evaluation of costs vs. benefits, etc., in order to push through "reform" that has been rejected by Americans in poll after poll and was even the major issue causing, of all states, Massachusetts to give "Ted Kennedy's seat" to the 41st Republican vote in the Senate.
Major legislation should be bipartisan to be durable. Democratic initiatives such as Social Security, Medicare and major civil rights legislation all had significant Republican support. Health care should follow that pattern.
In the meantime, the Federal government is lurching from one financial crisis to another, with dishonest accounting for the housing bailouts and the pretense that its interventions do a net good to the economy. Rather, it is mainlining the opiate of more and more credit (borrowing and lending) into an addict that needs to detox.
Today on TV I saw an ad for mortgages from Lending Tree. It's easy to borrow from them, they say.
Except for lower housing prices and lots of pain, and a temporary retrenching in battered financial companies how much has fundamentally changed from the credit bubble of the aughties?
Answer: not enough.
Government at all levels have already taken on massive current responsibilities and even more massive future ones. This includes pension obligations at the state level as well as Medicare and Social Security unfunded Federal obligations.
The idea that an irresponsible Federal government should extend its powers and take on yet more responsibilities flies in the face of common sense. Let it show it can do things right with its current job before it gets a promotion.
The American people "get it". A recent WaPo poll showed that by 3:2, Americans prefer a Federal government that provides relatively fewer benefits in return for taxing and spending less. It's not a poll that Barack Obama can easily wriggle away from. Picking on an ancient issue of possibly excessive (how to define?) rate increases by insurers at the last minute in order to bring more power to Washington is the wrong way to govern and also is philosophically out of step with the people who elected him.
Copyright (C) Long Lake LLC 2010
Saturday, December 12, 2009
Is Business Support for Healthcare Reform Crumbling?
From Politico, Business Roundtable edges away from health reform plan; note especially the last sentence. This might be of some real significance (which is why I am posting on it):
Without fundamental changes to the current health reform plans, the White House and congressional Democrats risk losing the last major corporate group that is standing by their effort: The Business Roundtable.
In an interview with POLITICO on Friday, Roundtable President John Castellani raised concerns about the effectiveness of cost containment provisions in the proposal, and the timing of various fees and taxes that ultimately could be passed on to employers that provide insurance to workers.
“If these areas aren’t improved the reform effort will not work and we need something that works,” said Castellani.
Castellani wouldn’t say how long the group is giving Democrats to fix the bill, but said, “We are going to be much louder and much more insistent on improving” the legislation.
Castellani’s comments are significant because the White House, including President Barack Obama, has often contrasted the Roundtable’s cooperative role with that of the U.S. Chamber of Commerce, which is lobbying hard against the plan.
It is late in the day to see this type of news report from a down-the-middle organization such as Politico.
Copyright Long Lake LLC 2009
Without fundamental changes to the current health reform plans, the White House and congressional Democrats risk losing the last major corporate group that is standing by their effort: The Business Roundtable.
In an interview with POLITICO on Friday, Roundtable President John Castellani raised concerns about the effectiveness of cost containment provisions in the proposal, and the timing of various fees and taxes that ultimately could be passed on to employers that provide insurance to workers.
“If these areas aren’t improved the reform effort will not work and we need something that works,” said Castellani.
Castellani wouldn’t say how long the group is giving Democrats to fix the bill, but said, “We are going to be much louder and much more insistent on improving” the legislation.
Castellani’s comments are significant because the White House, including President Barack Obama, has often contrasted the Roundtable’s cooperative role with that of the U.S. Chamber of Commerce, which is lobbying hard against the plan.
It is late in the day to see this type of news report from a down-the-middle organization such as Politico.
Copyright Long Lake LLC 2009
Sunday, September 20, 2009
Let Them Eat Kale?
In How To Shop At Farmer's Markets, Mish picked up on a WaPo report that Michelle Obama was recently in the following predicament:
Let's say you're preparing dinner and you realize with dismay that you don't have any certified organic Tuscan kale. What to do?
Her solution involved what was described thusly, as she visited a local farmer's market that she helped to bring to near the White House:
The Secret Service and the D.C. police brought in three dozen vehicles and shut down H Street, Vermont Avenue, two lanes of I Street and an entrance to the McPherson Square Metro station. They swept the area, in front of the Department of Veterans Affairs, with bomb-sniffing dogs and installed magnetometers in the middle of the street, put up barricades to keep pedestrians out, and took positions with binoculars atop trucks. Though the produce stand was only a block or so from the White House, the first lady hopped into her armored limousine and pulled into the market amid the wail of sirens.
I had seen the report but elected not to comment. Now that a prominent blogger has picked up on it and I came up with a clever title for my own post, I felt that it shouldn't hurt to comment here.
Mish's take is that Mrs. Obama's actions were "arrogant silliness" and that this sort of behavior was out of touch and would tend to hurt the President's popularity.
My take is somewhat different from Mish's. Consider this quote from the article:
The first lady had encouraged Freshfarm Markets, the group that runs popular farmers markets in Dupont Circle and elsewhere, to set up near the White House, and she helped get the approvals to shut down Vermont Avenue during rush hour on Thursdays. But the result was quite the opposite of a quaint farmers market. Considering all the logistics, each tomato she purchased had a carbon footprint of several tons. . .
And now consider the article's conclusion, in which the first lady was described speaking to a crowd at said farmer's market to observe her shopping:
She spoke of the fuel fed to the world's most powerful man: "I've learned that when my family eats fresh food, healthy food, that it really affects how we feel, how we get through the day . . . whether there's a Cabinet meeting or whether we're just walking the dog."
And she spoke of her own culinary efforts: "There are times when putting together a healthy meal is harder than you might imagine."
Particularly when it involves a soundstage, an interpreter for the deaf, three TV satellite trucks and the closing of part of downtown Washington.
This is not of course substantive hard-hitting investigative journalism, but it does have an anti-(Michelle) Obama flavor. The Post, a reliably liberal paper, easily could have covered this event in a much more pro-Obama manner. Whether or not the physical newspaper is or is not acid-free, certainly this article was acidic and acerbic.
From a policy standpoint, the DoctoRx opinion is that I would rather that Mrs. Obama quietly had someone walk to the farmer's market to purchase whatever was needed, and the President:
A) emulate Bill Clinton and present his preferred healthcare reform plan to Congress;
B) put specific provisions in said plan that would favor affordable healthy foods over sugar-added/salt-added etc. ones in a non-coercive way (recall what the Government has done to act against cigarette smoking);
and
C) mentions (B) in his speeches or TV appearances.
Not only let them eat kale, but reasonable tax and regulatory governmental action can encourage it.
Copyright (C) Long Lake LLC 2009
Let's say you're preparing dinner and you realize with dismay that you don't have any certified organic Tuscan kale. What to do?
Her solution involved what was described thusly, as she visited a local farmer's market that she helped to bring to near the White House:
The Secret Service and the D.C. police brought in three dozen vehicles and shut down H Street, Vermont Avenue, two lanes of I Street and an entrance to the McPherson Square Metro station. They swept the area, in front of the Department of Veterans Affairs, with bomb-sniffing dogs and installed magnetometers in the middle of the street, put up barricades to keep pedestrians out, and took positions with binoculars atop trucks. Though the produce stand was only a block or so from the White House, the first lady hopped into her armored limousine and pulled into the market amid the wail of sirens.
I had seen the report but elected not to comment. Now that a prominent blogger has picked up on it and I came up with a clever title for my own post, I felt that it shouldn't hurt to comment here.
Mish's take is that Mrs. Obama's actions were "arrogant silliness" and that this sort of behavior was out of touch and would tend to hurt the President's popularity.
My take is somewhat different from Mish's. Consider this quote from the article:
The first lady had encouraged Freshfarm Markets, the group that runs popular farmers markets in Dupont Circle and elsewhere, to set up near the White House, and she helped get the approvals to shut down Vermont Avenue during rush hour on Thursdays. But the result was quite the opposite of a quaint farmers market. Considering all the logistics, each tomato she purchased had a carbon footprint of several tons. . .
And now consider the article's conclusion, in which the first lady was described speaking to a crowd at said farmer's market to observe her shopping:
She spoke of the fuel fed to the world's most powerful man: "I've learned that when my family eats fresh food, healthy food, that it really affects how we feel, how we get through the day . . . whether there's a Cabinet meeting or whether we're just walking the dog."
And she spoke of her own culinary efforts: "There are times when putting together a healthy meal is harder than you might imagine."
Particularly when it involves a soundstage, an interpreter for the deaf, three TV satellite trucks and the closing of part of downtown Washington.
This is not of course substantive hard-hitting investigative journalism, but it does have an anti-(Michelle) Obama flavor. The Post, a reliably liberal paper, easily could have covered this event in a much more pro-Obama manner. Whether or not the physical newspaper is or is not acid-free, certainly this article was acidic and acerbic.
From a policy standpoint, the DoctoRx opinion is that I would rather that Mrs. Obama quietly had someone walk to the farmer's market to purchase whatever was needed, and the President:
A) emulate Bill Clinton and present his preferred healthcare reform plan to Congress;
B) put specific provisions in said plan that would favor affordable healthy foods over sugar-added/salt-added etc. ones in a non-coercive way (recall what the Government has done to act against cigarette smoking);
and
C) mentions (B) in his speeches or TV appearances.
Not only let them eat kale, but reasonable tax and regulatory governmental action can encourage it.
Copyright (C) Long Lake LLC 2009
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