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This page contains a single entry from the blog posted on February 24, 2010 5:10 AM. The previous post in this blog was Nuthin' but a "T" thang. The next post in this blog is Reader poll: Where will Governor Ted's next paycheck come from?. Many more can be found on the main index page or by looking through the archives.

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Wednesday, February 24, 2010

Obama joins Wyden in selling short on health care

The progressive side of me is sorely disappointed in what has finally emerged as the White House version of health care legislation. Sorry, lefties, there will be no single-payer program -- heck, not even a public option. Under the Obama plan, the average guy and gal probably won't gain all that much, and the insurance companies definitely will laugh all the way to the bank.

Most people would be required by law to buy health insurance -- with federal handout money if they're really poor. And there'll be no one to buy it from other than the private insurance companies who are already raking in the dough from the current system. Oh, there'll be some goofball state-run "exchanges" that are supposed to create competition among these companies, but let's face it, they already technically compete against each other now, and look at how much profit they're making.

Apparently there will have to be some "nonprofit" companies added to the mix, but that's kind of a joke. Nonprofit -- like the hospitals? As if nobody's getting rich at the hospitals. The nonprofits' top honchos make seven figures a year these days, if not eight, all at the expense of the average worker. For example, OHSU is a "nonprofit charity" -- but check out the doctors' parking lot some weekday morning to see how "charitable" it is.

The tradeoffs that are being proposed for the insurance companies' huge financial windfall are that they will have their rates federally regulated (no doubt by a panel of friendly faces with weak standards), and that they'll have to stop playing their "pre-existing condition" games when they decide to pull the rug out from under people. That's a trade they'll take, especially since sooner or later they'll be prohibited from continuing their more egregious Scrooge moves, in any event.

The President's bill looks a lot like the plan put forth by Sen. Ron Wyden (R-N.Y.), who snuffed out hopes for real health care reform last summer with his hemming and hawing. Senators like Wyden, and Rockefeller, and Dodd, who parade around under the aegis of the Democratic Party but always answer to the big corporations when the chips are down, are the biggest problem in American government right now. If I wanted Republican policies, I'd vote for a Republican. Maybe this fall I will, rather than vote to re-elect the incumbent.

The height of cynicism in the President's bill is how it handles its proposed new income taxes on high-end health care plans furnished by employers to employees. I oppose such taxes generally, but if you're going to impose them, then at least have the guts to do it immediately. Instead, the White House plan says that these taxes won't start until 2018. Whenever politicians tell me what the tax system is going to be like eight years from now, I feel as if I'm about to vomit. These jokers can't even tell us what the tax law was two months ago -- maybe they'll retroactively raise people's taxes back to January 1, maybe not. Why should I pay the least bit of attention to what they pass today with respect to eight years from now? By 2018, or sooner, we may very well have somebody like Mitt Romney in the White House, in which case income taxes on "Cadillac" health plans will likely never come to pass. Some days all I wish is that our elected officials would stop jerking us all around.

They're also going to extend Medicare taxes (2.9%) for the first time to income from investments. That pretty much kills any chance at Republican support, and it's likely to get the AARP types howling as well. At the moment, this new tax would apply only to high-income folks, which makes it progressive enough, but it's a brand new wrinkle that's going to take months for people to process. And the closer we get to the November elections, the harder that processing is going to get.

To many of us who felt profound hope and accomplishment on Inauguration Day 2009, the White House health plan feels like one of the last embers going out. Ralph Nader was guilty of vast overstatement when he said that there are no differences between the two major parties. But on health care reform, he was 100% right. I'd be less depressed if Congress simply let health care reform die than if it passes the weak, empty Obama plan and acts as if it were actually achieving something that was promised in the last campaign.

And whatever they do, I wish the people under the toupees would get the health care agony over with. It's been 13 months now in which they've dealt with this and pretty much nothing else. The historic Democratic Party primacy is being squandered. We won't get fooled again.

Comments (21)

I consider myself ultra-liberal, but I am questioning what appellation I should be wearing: I always voted for Packwood and Hatfield. And was proud when the ACLU mailed my my first membership card thanks to (one of the many) Dan Quayle's gaffe.

Gee, if Richard Nixon had indeed tapped Senator Hatfield instead of Gerald Ford for Veep I wonder how the world would have turned out? Sigh....

Great comments, but the one point that must be made is that nothing will happen to reform health care in the U. S. until the system itself is changed.

Right now there is a mismatch in the health care system. Consumers for the most part pay a fixed fee (health insurance premiums, medicare premiums etc) while health care organizations are paid on a per procedure basis. The insurance companies and government are in the midddle. The incentive for providers is to make more money by doing more procedures, providing more care, whereas the consumers do not care because their costs are mostly fixed, and the insurance companies and government cannot effectively control the costs because they cannot separate out necessary procedures from fee building procedures.

The concept of insurance itself is wrong for health care. Insurance works when there is a low probability of a negative event occurring, with a high loss when the event does occur. Casualty events are excellent candidates for insurance. Health care is not.

The only solution is for the physicians and health care organizations to accept a fixed fee for services. This will match the revenue system with the cost system. Health care organizations will have the incentive to cut costs, and if a truly competitive and regulated system is developed, competition and regulations will prevent providers from reducing services below necessary standards, since patients could take their dollers elsewhere.

Until health care providers stop being entrepreneurs and start being salaried, the system will never ever work. Costs will go up, more people will be denied basic care, and health care organizations, providers and insurance companies will continue to get wealthier.

None of this is new, we know what to do, we just do not want to do it.

"The only solution is for the physicians and health care organizations to accept a fixed fee for services."
Ernesto would be proud.

We already have government run health care. It's run to benefit the health care providers and lawyers, not the health care consumer.

It's the same dynamic that explains why our public schools are poor quality and cost so much.

Free markets always benefit the consumer. It works everywhere it has been tried.

"Free markets always benefit the consumer. It works everywhere it has been tried."

Yeah, uh hah... we saw how those free unregulated markets worked in the past 6 years with the financials.. and then the republicans say well you didn't let them fix themselves with the free market.. what's the free market fix, letting the banks fail? What would a bank failure look like if the fed didnt step in prop up the banks? Wouldn't peoplecomapnies who have over the FDIC insured amount deposited lose it? Many company's deposit over $250,000, so if the free market fix were in place, those companies would lose their deposits, thus not be able to make payrolls and pay their vendors who also have payrolls to meet..that equals more unemployed people.. not to mention the FDIC only has so much money to offer.. so then what happens when the FDIC runs out of cash in this free market system of correction?

And what about the free market fix for the auto manufacturers? Just let them close their doors and put millions of auto workers and their sub-contractors out on the streets? That sounds like a recipe for disaster too..Just what this economy needs more of, more unemployed people losing everything.


So no thanks to this free market crap..we already see how the free markets work in the health insurance industry.. they raise premiums then deny services all in the name of profit...

That's the result when you have a complete lack of leadership at the top. Obama has sat back and coasted, because that is all he knows how to do. Now that the results are due, he jumps in but its just too late.

Did they even address tort reform for starters?

Did they even address tort reform for starters?

Right on. The system we really need is the one that doesn't compensate victims of negligence and worse. That worked well with OHSU, didn't it?

D. O. A.

Hey Kathe W? Just how much does malpractice and wrongful death lawsuits add to budget of the insurers? Ive heard less than 3%... but the bigger gain would be for the republicans who think the dems get all their funding from those damn trial lawyers... isn't that the real goal of tort reform as presented by the republicans? and what about that tort reform that went into play in Texas about 10 years, have Texans seen a big reduction in their healthcare bills? Not from what Ive read...


they already technically compete against each other now

How so? There is no true competition in the insurance field, all due to government. Bring down that wall and see what happens. Why do you think so many of us are fighting against the all-or-nothing types? Cause we don't want cheap, quality insurance for everyone? Come on now...


Yeah, uh hah... we saw how those free unregulated markets worked in the past 6 years with the financials.. and then the republicans say well you didn't let them fix themselves with the free market.. what's the free market fix, letting the banks fail? What would a bank failure look like if the fed didnt step in prop up the banks? Wouldn't peoplecomapnies who have over the FDIC insured amount deposited lose it? Many company's deposit over $250,000, so if the free market fix were in place, those companies would lose their deposits, thus not be able to make payrolls and pay their vendors who also have payrolls to meet..that equals more unemployed people.. not to mention the FDIC only has so much money to offer.. so then what happens when the FDIC runs out of cash in this free market system of correction?

And what about the free market fix for the auto manufacturers? Just let them close their doors and put millions of auto workers and their sub-contractors out on the streets? That sounds like a recipe for disaster too..Just what this economy needs more of, more unemployed people losing everything.

Yep! Let them fail. What you're proposing is no matter what their actions, some companies are too big or too important to fail. Thinking like that is exactly why what *you call* the free market system that we've tried isn't or hasn't worked. That's why they call it a system, and failure is one of the most important components.

Joey, no leader in their right mind would want to deal with 10s of millions of additionally unemployed people as what youre saying would be the right thing to do.

The problem is the corporations were allowed to get to big to fail... now they should be broke up before they can do more damage.. in the mean time, I think it will be safer for all involed to bail out the big guys, send some CEOs to jail for fraud.. Do you want to live in a world where theres 30-50% umemployed? And in the perfect world of the republicans, there would be no unemployment checks either... the scenario you think is right seems right for revolution.. because thats what people do who see no future...

No, no, Jack, DON'T vote for a Republican. That's the wrong message altogether - Wyden isn't conservative enough for you?

There WILL be a Pacific Green running against him (sorry no name - he still works for the federal government). He plans to run a major-party race, and he's done the work to make it happen. Wyden is indeed vulnerable, for the reasons mentioned, as well as repeated votes for every war that comes down the pike - all of which do Oregon only harm. Since when do we have any defense industries?

There cannot be a functional market in health care, because knowledge isn't equal - one of the requirements. Nor do we price-shop doctors or hospitals, nor are we in any shape to do so when we need them. Just imagine the discussion in the ambulance:

Patient: "No, that one's too expensive, go to the cheap one!"

Medic: "Are you out of your freaking mind?"

It would make sense to put providers on salaries. But we can ask the Canadians or Brits: they like the systems they have.

Wyden doesn't. Does that have anything to do with all the campaign "donations" from Big Insurance and Big Pharma?

And Old Zeb: I can tell you what "appellation" you should be wearing: Green. The Democrats sure aren't liberal anymore, and the Republicans never were.

The Dems' incompetence on the health care issue has been astounding. Instead of this ridiculously complex approach, all they had to do was increase the Medicare tax from 1.45% (2.9 for both employers and employees) to about 4.5% (9% total) and provide Medicare for all.

Easy to understand. People know it and like it. It fixes the Medicare funding problem. It reduces the cost of government (few government employees' health care benefits cost less than 9% of their salary). And they could read the bill on the floor of Congress in less than 30 minutes.

The only thing worse during this debate has been the Republican arguments. Tort reform, HSAs, and selling insurance across state lines (which the Dems would do as long as the Repubs would agree to the federal insurance regulation that would make it work, since you can't have weak state regulation shopping and federal sales). Both sides are yucky.

Nor do we price-shop doctors or hospitals, nor are we in any shape to do so when we need them.

Yeah, that's lazy work there. I price shop hospitals and docs all the time. It cost me less than half out of pocket to have gall bladder surgery at Providence than it would have at Emanuel-and I know this because I checked before the surgery.

Most medical care is not given on an emergency basis. There's time to price shop. The real problem is price isn't the only criterion--I doubt it's even first on the list. I chose my doc because she's woman-friendly, doesn't think all my issues are because I have ovaries/hormones/in my head. My dentist and hygienist treat me with respect and courtesy, not disdain and contempt (unlike the previous set). They're all just a short distance from my where I work and easily accessible from public transit. And they are listed as preferred providers on my medical insurance.

or as my dad says when the insurance statement arrive: "As long as I don't have to pay anything, what do I care what it costs."

I don't know about OHSU, but a member of my extended family was treated at Good Sam for a life-threatening disease & the hospital and Doctors were extremely charitable - The surgeon waived all fees and expenses, and the hospital covered almost everything out of their charity fund. And I know these are not the only instances - she regularly does these things for many, at a couple of 'safety-net' clinics. Several of us in the family have decided to remember this in our wills, & make contributions to the clinic.

This plan isn't my ideal, but I still think it's better than nothing. My daughter (2 years old) has a pre-existing condition from birth, and under the current system will never be able to get insurance once she leaves home. So the elimination of pre-existing condition exemptions is no small thing for us.

And I'm in favor of mandatory insurance coverage, so long as the subsidies are real, and they appear to be under this plan. We require it of drivers because of the economic externalities, and the same arguments apply to health care. Plus, once it's mandatory, the entire political calculus shifts. Congress will no longer be able to ignore bad behavior in the insurance industry because their reelection will depend on taking strong action. Right now, they can take millions from the industry and throw up their hands in disgust without doing anything. Under a mandatory insurance model, they'll gain votes by taking strong action.

A funny thing about the hospitals. Here in Dallas, we have a brand new consortium of several big hospitals, and lots of advertising to tell you that they're maximizing service and minimizing costs through this new arrangement. What's left out is that this consortium exists mostly to cut advertising costs: between television ads, radio ads, advertising supplements in every paper from here to Denver, and banners and billboards all over the Metroplex, most of the local hospitals were bankrupting themselves just advertising for new customers. (Until a few years ago, I'd point out that most people don't worry about a particular hospital until they need to get to an ER, so advertising a hospital was as stupid as advertising your local monopoly electrical utility. Thanks to Bush-Era electricity deregulation in Texas, though, we don't have one: like the hospitals, our various electricity providers are all working to keep prices good and high.)

What makes things even funnier is that a good friend of mine was recently laid off when the hospital in which she worked in IT shut down. The hospital board knew it was in serious trouble for years. Admissions were down, and most of the patients were ones with tiny medical budgets, thereby not interested in all of the insanely expensive new toys the hospital had just purchased. Now, instead of asking for the doctors and particularly the administrators to take a pay cut or otherwise give up their perks, the board decided to do the only thing it could think of...buying even more television advertising. The last of those ads should be reaching Alpha Centauri in about three years: let's hope they do more good for the Centauri than they did for any of us.

There WILL be a Pacific Green running against him

Never. Win.


the hospital covered almost everything out of their charity fund

Right. Also known as "overcharge the paying customers to cover it" fund.

Thanks for sharing the information with us.
this is very useful.
keep up great writing.


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