The most comprehensive info on Health Care Reform to date
Posted by Ray on March 20, 2010 under Main | 
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Look, I know there is rhetoric on both side and we all fall for the one liner, me included. We all want something done about health care, but when you learn about how this thing was put together, you will think differently about this, maybe.
I was watching C-SPAN last night and saw this very informative video from MIT professor Jonathan Gruber, who co-wrote both the Massachusetts program and the current Federal bill being voted on. He was a paid participant and openly admits he is biased towards the bill, but I appreciate the honesty. What I found striking is that he openly admits that 90% of this bill is designed for coverage and only 10% is geared for cost controls. He also admits they are trying a “spaghetti approach” to controlling costs, meaning they are throwing 37 different pilot programs against the wall to “see what sticks.”
If you listen to what he is saying it is clear that the government will become the biggest premium payer to insurance companies through subsidies. The implications of this can lead to the government having the ability to start dictating what gets covered and what is not covered, in my opinion. The MA plan is the benchmark for the national plan and that should be of some concern to us all. Why? The cost of insurance did not come down with a mandate to everyone to be insured and competition never increased, there are 4 carriers in MA. Currently, according to the MA treasurer, 52% of all spending in MA is going directly to this insurance program or Medicaid, again showing that costs were not controlled. Of course, the MA bill was all about coverage and not about reducing costs, Mr. Gruber admits that.
If we look at the MA program there are problems with it, like most people have to go to community hospitals and those hospitals are only getting 60-70% of the reimbursement rate and 7 MA community hospitals are currently suing the state because they are going bankrupt. In order for everyone to get covered and for rates to not go through the roof insurers will have to pay doctors less, Mr. Gruber dances around that topic in his speech saying “surgeons used to be middle class people, but now they live in the Hamptons with investment bankers.” I have said that doctors do charge too much, $150 for a 2 minute office visit is nuts, but if private insurers have to adopt Medicare rates we will have less doctors, that is a fact.
Mr. Gruber is an economist, not a health care professional or insurance executive, which goes back to my point that no insurance person was ever involved in this process, but economists and lawyers are? I am sorry, but I do not like this approach because people often get left out of the equation in economists and lawyers models. He pointed towards the fact that doctors over test, which may be true, and that things like genetic testing is “too expensive.” He brings up some great points and says we will never have socialized or Canadian style health care in the US, I disagree with that as this bill will subsidize premiums up to, I think $80K in income.
This bill will do some great things, do not kid yourself, like the preexisting condition repeal and you cannot be dropped from coverage if you get sick, but those items could have been taken care of in straight up or down votes a year ago January. Regardless, Americans are furious over the process of what is happening and not being listened to. I want a straight up and down vote on the issue and I want to know for a fact that my Congressman read the bill, any Congress person saying this bill controls costs is not being truthful as the author tells you they are not sure this will control costs.
Mr. Gruber admits that when MA hit its financial trouble in 2008 they had to cut the program in MA. What does that mean on the Federal level where this thing is a trillion dollars? He says that by spending $950B to cover people now will save $30T over the next decade, I think he misspoke big time there as that is impossible. I also do not believe that the taxes collected over the next 4 years will not be spent, we are broke after all borrowing $200B a month remember, and the program will start in the red right off the bat in 2014. I also do not believe that the new taxes will only be on the top 5% of US taxpayers, like the AMT (alternative minimum tax) it started out on high net worth individuals and now it hits people below the $100K mark, unless Congress passes the AMT fix every year. Just like the AMT these new taxes will creep down because wealthy individuals got wealthy because they know how to avoid taxes.
CBO estimates, I hate CBO estimates, why? If you give the CBO the numbers you want to run you will get the results you want, it is that simple. They make little assumption on how these numbers will change over time, like people buying less income securities or dividend paying stocks so taxes drop or wealthy people decide to make $199,000 instead of $200K a year. They assume today’s numbers will stretch from here into infinity which is a joke. Look at Medicare projections back in the 1960’s, or the 1980’s or the 1990’s, you have to project the worst case scenario, not the best, and I can assure you that if they did that the numbers would be ugly. Basically, feed the CBO the data you want to get and bingo! Deficit reduction.
Mr. Gruber also wants to get rid of the tax break on health care premiums, the Cadillac Tax as it is called. Basically it is getting rid of the tax subsidy, or tax deduction, on plans that cost over $23K a year. This is not going to raise the money they think as most of the people with Cadillac plans are unions or a small portion of executive, a very small portion. There is no way that this tax deduction will stay at this level and plans that cost less than $23K will, eventually, lose their tax break as well, especially as the Cadillac Tax kicks in and those plans are dropped. Most of you have health insurance because, A) Your employer wants to remain competitive in the workplace; and B) Because they get a tax deduction for providing that benefit, why do you think they pay so much of the premium? You get rid of that and people will be left on their own, so it may be a good thing for employers, time will tell.
Oh, for all those who think we have the 37th worst health care in the world, think again. Over 240K people come to America to get some form of treatment and only 12,000 Americans leave for treatment abroad. Mr. Gruber explains that it is social economics is the problem, essentially, and, in his example, a black baby in Washington DC has the same chance of reaching their first birthday as a baby in Jamaica, that is horrible. However, what he says is what I have been saying, this is because we have an access problem.
He also states that we are like the Roman Empire if we do not get health care under control. The issue is that health care is one leg of the three legged problem. The other two legs are Social Security and our national debt. This bill currently only might fix health care, but based on MA it probably will not and based on what we know about our elected officials the other 2 legs are not going anywhere. However, as Mr. Gruber pointed out earlier in his speech, this bill really might not control costs at all. This bill also does not control prescription drug costs, at all, and Mr. Gruber says we must pay more so the rest of the world can pay less, unreal.
There was a better way of getting to a middle ground and trust me I want a middle ground. I just do not believe that this bill is legal, the Federal government cannot force you to buy anything, in my opinion, and I do believe that deem and pass should be banned, look what happens and I have heard enough of “well, they did it too,” two wrongs do make a right. I highly recommend watching this 1 hour 23 minute video to cut through the rhetoric. However, listen to what he says and what he kind of says. Listen to it without your own bias as you will hear some things that might not sit well with you. Sometimes what a person does not say means more than what they would actually say.
Oh, no illegal immigrants will get coverage, just an FYI.
I could not embed the video, below is the link.
The Real Health Care Information You Need to Know
http://www.c-spanarchives.org/program/ID/220887
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