Monday, July 16, 2012

When someone doesn't tell the truth, it's OK to point out that they're lying.

Bill Keller is a Pulitzer Prize-winning journalist who served as the managing editor of the NY Times from 1997-2001. He wrote a column in today's NY Times called 5 Obamacare Myths. Unless you are a NYT subscriber, you are limited in the number of articles you can read each month, so allow me to hit the high points:

"...a number of fallacies seem to be congealing into accepted wisdom. Much of this is the result of unrelenting Republican propaganda and right-wing punditry, but it has gone largely unchallenged by gun-shy Democrats. The result is that voters are confronted with slogans and side issues — “It’s a tax!” “No, it’s a penalty!” — rather than a reality-based discussion."[All emphasis that follows is mine.]

Myth #1: Obamacare is a job-killer. "After years of trying out various alarmist falsehoods the Republicans have found one that seems, judging from the polls, to have connected with the fears of voters. Some of the job-killer scare stories are based on a deliberate misreading of a Congressional Budget Office report that estimated the law would “reduce the amount of labor used in the economy” by about 800,000 jobs. Sounds like a job-killer, right? Not if you read what the C.B.O. actually wrote. While some low-wage jobs might be lost, the C.B.O. number mainly refers to workers who — being no longer so dependent on employers for their health-care safety net — may choose to retire earlier or work part time. Those jobs would then be open for others who need them....The job-killer claim is also discredited by the experience under the Massachusetts law on which Obamacare was modeled."

Myth #2: Obamacare is a federal takeover of health insurance. Here Keller does what many journalists have forgotten is part of their job: Separating lies from truth. There are not two sides to every story. The Sun rises in the east, period. " Let’s be blunt. The word for that is “lie.” The main thing the law does is deliver 30 million new customers to the private insurance industry. Indeed, a significant portion of the unhappiness with Obamacare comes from liberals who believe it is not nearly federal enough: that the menu of insurance choices should have included a robust public option, or that Medicare should have been expanded into a form of universal coverage....This is a “federal takeover” only in the crazy world where Barack Obama is a “socialist.”

Myth #3: The unfettered marketplace is a better solution: " To the extent there is a profound difference of principle anywhere in this debate, it lies here. Conservatives contend that if you give consumers a voucher or a tax credit and set them loose in the marketplace they will do a better job than government at finding the services — schools, retirement portfolios, or in this case health insurance policies — that fit their needs."

Karen Davis, president of the Commonwealth fund, points out the fallacy of this argument with regard to health care: "Ten percent of the population accounts for 60 percent of the health outlays. They are the very sick, and they are not really in a position to make cost-conscious choices.”

Myth #4: Leave it to the states, they'll fix it. "The Republican alternative to Obamacare consists in large part of letting each state do its own thing. Presumably the best ideas will go viral....Obamacare actually underwrites pilot programs to reduce costs, and gives states freedom — some would argue too much freedom — in designing insurance-buying exchanges. But the best ideas don’t spread spontaneously. Some states are too poor to adopt worthwhile reforms. Some are intransigent, or held captive by lobbies."

Myth #5: OBAMACARE IS A LOSER. RUN AGAINST IT, RUN FROM IT, BUT FOR HEAVEN’S SAKE DON’T RUN ON IT. "When Mitt Romney signed that Massachusetts law in 2006, the coverage kicked in almost immediately. Robert Blendon, a Harvard expert on health and public opinion, recalls the profusion of heartwarming stories about people who had depended on emergency rooms and charity but now, at last, had a regular relationship with a doctor. Romneycare was instantly popular in the state, and remains so, though it seems to have been disowned by its creator."

"Unfortunately, the benefits of Obamacare do not go wide until 2014, so there are not yet testimonials from enthusiastic, family-next-door beneficiaries. This helps explain why the bill has not won more popular affection. "

"Even before the law takes full effect, it has a natural constituency, starting with every cancer victim, every H.I.V. sufferer, everyone with a condition that now would keep them from getting affordable coverage. Any family that has passed through the purgatory of cancer — as mine did this year, with decent insurance — can imagine the hell of doing it without insurance."

This will be my last post for awhile. I'll be traveling a lot over the next 2-3 weeks including some time on the Adirondack island I wrote about last year that's hell for teenagers: No bars on the cell phone, no internet connection and only one or two over-the-air TV channels. Hey, we have electricity, a landline phone, running water and indoor plumbing so let's not be greedy!

Saturday, July 14, 2012

Medicare meets Obamacare-part 2.

Let's begin by dealing with a couple of idiot emails about the Affordable Care Act (ACA) which have "gone viral" recently.

The first is on the "Hot 25" list at It claims that there is a "secret" part of the ACA--being hidden until after the election-- which will cause Medicare part B premiums to balloon to $247/month in 2014. Here's what snopes has to say:

"The short answer to the question of the whether these figures for Medicare insurance premiums are accurate is no. "

"In the last few years, the standard monthly premiums for Medicare Part B have been set as follows:

2009: $96.40
2010: $110.50
2011: $115.40
2012: $99.90"

"(Many beneficiaries paid less than the listed amounts in 2010 and 2011 because of the "hold-harmless" provision of Medicare which states that if the dollar increase in your Medicare Part B premium is bigger than the dollar increase in your Social Security check, you don't have to pay the difference.)"

"As for future Medicare Part B premium rates, the information cited above is wrong on two counts: No provision of the health care legislation passed during the Obama administration sets Medicare premium rates, nor is a whopping jump of over 100% to a $247.00 monthly premium in 2014 a realistic figure." [Emphasis mine.]

"New Medicare premium rates come out each fall and take effect in January. Medicare beneficiaries as a group are required to pay one-fourth the cost of running Medicare, and annual premiums are set at a figure calculated to achieve that level of revenue. Although the annual premium rates aren't officially set until they are announced each fall, Medicare administrators track trends and anticipated changes and use them to formulate projections of Medicare premiums for the next several years. According to the most recent report of the system's trustees, issued in May 2011, those projected premiums (as listed on page 218) are:

2013: $110.50
2014: $115.80
2015: $120.80
2016: $126.00
2017: $132.70
2018: $140.30
2019: $148.40
2020: $158.60"

The second email is an oldie-but-goodie which has been repurposed by opponents of the ACA. It claims that the ACA will be paid for by imposing a 1% tax on all banking transactions: deposits, withdrawals, checks, etc.

We've dealt with this one before. See the post about "Hair-on-fire emails." You can read the details in the above post, but the short story is that it's a load of baloney. There is no such tax and--since it's the pet project of a single member of Congress who introduces it every session, but receives no support from anyone else--it's not likely there ever will be such a tax.

Are there real taxes that Medicare participants will pay to fund the ACA? If you have Medicare, you will NOT be subject to the tax imposed on those who do not have health insurance.

If your yearly income is above $200,000 ($250,000 for a married couple) AND you are still working, your Medicare payroll tax will increase by 0.9%. 

If your yearly income is above $200,000 ($250,000 for a married couple) your investment income in taxable accounts (which EXCLUDES IRA's, 403(b)'s and 401(k)'s) will be taxed at the rate of 18.8% instead of the current 15%. There are, of course, no taxes for ANYONE on investment income within tax-sheltered accounts such as IRA's, etc.

If you use a tanning parlor, there will be a 10% tax on tanning bed use. (Not sure how many Medicare participants want to make their skin look even older and more leathery, but who knows.)

Thursday, July 12, 2012

Medicare meets Obamacare.

This blog's target audience is retired teachers in WNY, which means that Medicare is probably at the top of your list of questions about the Affordable Care Act (ACA).

Before addressing the specifics of the ACA with regard to Medicare, however, we need to do a little background work on some of the details of Medicare's inner workings.

Medicare comes in two "flavors": traditional (sometimes called "fee-for-service" Medicare) and Medicare Advantage plans. Seventy-five percent of Medicare participants are in traditional Medicare while the remaining 25% are in Medicare advantage plans. That 3/1 ratio of traditional Medicare participants to Medicare advantage participants is important, and will have a tremendous bearing on how you personally view the Medicare changes in the ACA.

Traditional Medicare is run by the government. It consists of Part A (hospital costs), Part B (doctor costs) and Part D (prescription drug costs). There is no cost to the participant for Part A, although there is a deductible for each hospital admission. Participants pay a monthly premium of $96.40 (or close to this amount) for Part B coverage. There is a yearly deductible for Part B costs. In addition Medicare only pays 80% of the covered Part A and B expenses. Traditional Medicare participants may, if they choose, purchase supplemental (Medigap) insurance to cover all or part of these costs not covered by Medicare. Traditional Medicare participants may also purchase Part D drug insurance through private insurance companies approved by Medicare.

Traditional Medicare is a "fee-for-service" plan. Whenever you receive a covered medical service, Medicare provides a set fee for that service to the provider. Medicare providers have agreed to accept whatever fee Medicare provides as payment in full. (Actually, Medicare only pays 80% of this fee to the provider. The other 20% is billed to the patient or their Medigap insurance, if they have purchased it.) If you receive no covered services during a year, Medicare spends no money on your behalf. There is no upper limit on your yearly cost to Medicare if you do receive covered services.

Medicare Advantage plans (also known as Medicare Part C) began in the 1970's with the idea that the private sector could do Medicare more cheaply than the government. Over the years, Congress has made several changes to Medicare Advantage so that its focus now is attracting more private participation.

Medicare Advantage plans are run by private insurance companies such as Univera, Independent Health, etc. Medicare pays these companies a flat fee to provide hospital and doctor services to their members. Some Medicare Advantage plans also include Part D drug coverage, while others require that their members purchase it as a separate entity.

While participants in traditional Medicare are free to use any doctor or hospital and do not require a referral to see a specialist, Medicare Advantage plans usually require members to use only hospitals or doctors in their network. Going "out-of-network" usually results in the member paying either a larger share of the cost or, in some cases, the full cost of the service.

If you are unsure which "flavor" of coverage you have, if you pay a "co-pay" when seeing your doctor, you are probably a Medicare Advantage member.

Medicare Advantage members also pay their Part B premium to Medicare, usually through direct deduction from the Social Security payment each month. The amount that Medicare pays to the Medicare Advantage insurer for each member is a flat rate based on the average yearly cost to Medicare of traditional Medicare participants in your county.

And there's the rub. Medicare currently pays Medicare Advantage insurers about 15% more for each member than the average cost to Medicare for a traditional Medicare participant.

Many Medicare Advantage providers use this extra money to provide services not covered by traditional medicare such as dental, eyeglasses and gym memberships.

Everyone agrees that Medicare has financial problems. The Part B premium, for example, covers only about 25% of the cost of doctor services to Medicare participants. We Medicare participants often boast that we're "paying our way" through our premiums. Sadly, that's simply not the case.

The ACA attempts to help stem the rise in Medicare costs by scaling back the increase in payments to Medicare advantage providers by about $322 billion over the next 10 years. Note that this is NOT a decrease of $322 billion from the current payment level. Instead, it is a decrease in the expected rise in these payments.

If you are one of the 3-out-of-4 traditional Medicare participants, you will probably view this as a good thing. There will be no change in your Medicare services and the overall cost of Medicare will be $322 billion closer to being under control.

If you are the 1-out-of-4 person who participates in a Medicare Advantage plan, you will likely see some decrease in the "extra" services such as gym memberships.

To be fair, however, with everyone paying the same dollars into Medicare, it's hard to make a case that it's fair that Medicare spend an extra 15% on 25% of participants allowing them to receive benefits that the other 75% do not receive. And, in addition, we help bring Medicare costs under control.

And, this $322 billion in savings is used to help pay the costs of the ACA.

Believe it or not, there's even more to say about Medicare in the next post.

[NOTE: Click here for an excellent side-by-side comparison of traditional vs Medicare Advantage provided at the Medicare website. Click here to download a much more complete explanation of Medicare Advantage plans from the Kaiser Family Foundation.]

Tuesday, July 10, 2012

Health reform fact checking - part 2

It doesn't matter which politician--or talking head-- you're listening to, it's almost certain that they are putting a favorable "spin" on what they're saying. As a voter, your job is to take the time to find out what the late Paul Harvey used to call "the rest of the story." Here's some help from the fact checkers at the Associated Press:

1) OBAMA: "And by this August, nearly 13 million of you will receive a rebate from your insurance company because it spent too much on things like administrative costs and CEO bonuses and not enough on your health care."

"THE FACTS: Rebates are coming, but not nearly that many Americans are likely to get those checks and for many of those who do, the amount will be decidedly modest."
"The government acknowledges it does not know how many households will see rebates in August from a provision of the law that makes insurance companies give back excess money spent on overhead instead of health care delivery. Altogether, the rebates that go out will benefit nearly 13 million people. But most of the benefit will be indirect, going to employers because they cover most of the cost of insurance provided in the workplace."
"Employers can plow all the rebate money, including the workers' share, back into the company's health plan, or pass along part of it."
"The government says some 4 million people who are due rebates live in households that purchased coverage directly from an insurance company, not through an employer, and experts say those households are the most likely to get a rebate check directly."
"The government says the rebates have an average value of $151 per household. But employers, who typically pay 70 to 80 percent of premiums, are likely to get most of that."

2. ROMNEY: "Obamacare raises taxes on the American people by approximately $500 billion."
THE FACTS: The tax increases fall heavily on upper-income people, health insurance companies, drug makers and medical device manufacturers.
People who fail to obtain health insurance as required by the law will face a tax penalty, although that's expected to hit relatively few because the vast majority of Americans have insurance and many who don't will end up getting it. Also, a 10 percent tax has been imposed on tanning bed use as part of the health care law. There are no other across-the-board tax increases in the law, although some tax benefits such as flexible savings accounts are scaled back. Of course, higher taxes on businesses can be passed on to the consumer in the form of higher prices.
Individuals making over $200,000 and couples making over $250,000 will pay 0.9 percent more in Medicare payroll tax and a 3.8 percent tax on investments. As well, a tax starts in 2018 on high-value insurance plans.
Let's finish with a couple of Q&A's from the NY Times"

"Q. Will my insurance premium go up?

A. The Congressional Budget Office estimates that private health insurance premiums will increase by 5.7 percent each year, on average, from 2012 until 2022. But premiums would be getting more expensive with or without the Affordable Care Act. The budget office has estimated that, relative to what would happen in the absence of the law, premiums in the individual insurance market will be a little higher, employer-sponsored insurance premiums for big companies will be a little lower and employer-sponsored insurance premiums for small companies will stay about the same."

Q. I’ve heard that I’m required to have insurance. When does that go into effect? And what sort of penalties will I face if I don’t comply?
A. Starting in 2014, most Americans will be required to have health insurance and could face federal penalties if they do not. Taxpayers will be required to indicate on their tax returns whether they have health insurance that meets minimal benefits standards, according to the Commonwealth Fund. If consumers do not have insurance by 2014, they would owe $95, or 1 percent of taxable income, whichever is greater. The penalty rises to $325, or 2 percent of taxable income in 2015, and then $695, or 2.5 percent of taxable income in 2016, up to a maximum of $2,085 per family.
Next time we'll talk about what the Affordable Care Act means for those of us on Medicare.

Saturday, July 7, 2012

We have laws because "please" doesn't work.

I left off my last post with a question: Who was the first U.S. president to sign a law requiring the purchase of health insurance? We will get to the answer in due course, but first a word about tyranny.

The dictionary definition is "Cruel or oppressive government or rule." To listen to some of our fellow citizens, a fresh steaming load of tyranny is delivered daily from Washington or Albany or some other seat of government in the form of new laws which interfere with our freedom.

We have laws because saying "please" doesn't work. Sure, we could post signs on the Thruway saying "For the safety of all, please drive on the right side of the roadway." Unfortunately, some of our fellow citizens never got over their "You're not the boss of me" tantrums from their formative years. Saying "please" doesn't work for some so we pass a law and enforce it with a fine.

Most of us would never dream of raising pigs in our backyard and installing a manure lagoon in the side yard. Unfortunately, there are a few who would take the "It's my property and I'll do what I damn well please with it!" approach. "Please" doesn't work, so we pass a law.

Anybody remember the great seatbelt tyranny of the 70's? Headlines were full of references to the tyrannical government insisting that we not only buy something (seatbelts) but be forced to use the seatbelts we were forced to purchase in our cars!

The same could be said for the great motorcycle helmet tyranny. You were required to wear one which meant--unless you received it as a gift--you were forced to buy a product.

Why did we care? Because lots of those who were injured or killed left medical bills to be paid by the rest of us in the form of higher costs to hospitals leading to higher premiums for our health insurance. Leave a family behind? The "safety net" services required by that family were paid by the rest of us in the form of higher taxes.

When advertising campaigns and saying "please do the responsible thing and buckle up" didn't work, we passed a law.

Much mileage has been generated during the health care debate concerning whether the government could force us to buy broccoli.

Many readers of this blog are retirees who can remember the Vietnam era and the military draft. There was no argument that the government had the power to take a young person from their home and family, drop them into a jungle half a world away and order them to kill--or to die.

Given the power to do that, it seems rather silly to be arguing about whether the government has the power to make someone do the responsible thing and purchase health insurance.

Yet there are those who tell us that they "know the minds" of the framers of the Constitution. Very often this seems to be the same group who tells us that they "know the mind" of God. I must have missed those courses in school.

The framers, they say never imagined the tyrannical depths to which the government would sink. They never imagined that the Constitution would allow the government to force citizens to buy a product.

You know how they write stuff down in books about what people do. They call it history. Some people actually keep track of those events. One such person is Einer Elhauge, who teaches law at Harvard. Elhauge wrote an article titled "The Irrelevance of the Broccoli Argument against the Insurance Mandate" for the New England Journal of Medicine.

Elhauge brought some interesting history to light in that article: "In 1790, the first Congress, which was packed with framers, required all ship owners to provide medical insurance for seamen; in 1798, Congress also required seamen to buy hospital insurance for themselves."

"In 1792, Congress enacted a law mandating that all able-bodied citizens obtain a firearm. This history negates any claim that forcing the purchase of insurance or other products is unprecedented or contrary to any possible intention of the framers."

And now for our quiz answer. The first president to sign a law requiring the purchase of health insurance was, in fact, our first president George Washington. He also signed the 1792 law requiring the purchase of a firearm--if one was not already in your possession. The 1798 law--also requiring the purchase of health insurance--was signed by John Adams.

Poor men. I guess they just didn't understand the meaning of the Constitution that they had just written. Thankfully, we have great minds--such as Joe the Plumber-- some 200+ years later who understand what they REALLY meant.

Friday, July 6, 2012

Politicians spin for a living.

You know the old joke: How do you tell if a politician is lying? Because their mouth is moving. Then there are the "shades" of lying called "spinning." You don't necessarily say something untrue, but you frame the statement in such a way as to make you look good and/or make the opposition look bad. Yes, sadly both sides do it.

Before popping some spin balloons, let's talk about some initials. Hereafter ACA will be used for the Affordable Care Act (Obamacare). CBO stands for the Congressional Budget Office. These folks are the non-partisan number-crunchers. Both sides agree that the CBO estimates as to cost--for any bill--are the numbers that matter. OK, with that let the spin-stopping begin!

1) "This is a government takeover of the health care system." Let's go to the Washington Post factchecker for this one [all emphasis is mine]:

"This snappy talking point is used by Republicans repeatedly to bash Obama's crowning legislative achievement, but it is simply not true. In fact, labeled this claim the 2010 "lie of the year," but that has not stopped lawmakers from making this claim. It will surely be heard again on the House floor during the repeal debate."

"In many ways, the health care law resembles the Massachusetts reform enacted in 2006 under then Gov. Mitt Romney. It builds on the existing private insurance system but adds requirements and incentives to ensure that most people have some form of health insurance."

"Under the new law, there is no government alternative to the private system--this was a potential provision that was dropped during the congressional tussle--but the number of people who qualify for the existing federal-state Medicaid program for the poor will be expanded. States (or the federal government) will run "exchanges" -- essentially marketplaces -- in which private insurers will sell insurance to individuals and small businesses, but this should mean more people will get private insurance, not fewer. Tax credits will also be offered to people who have trouble buying private insurance."

"Certainly, the law bolsters government regulation of the health care system, such as forcing insurance companies to no longer deny coverage to people who have existing medical conditions. People who currently do not have health insurance will be required to buy it. But the core of the health system in the United States will remain the existing private insurance market. So it in no way resembles the government-run health systems used in most industralized countries in the world."

Let's go to the Associated Press for our final two spins of the day:

2) "Obamacare is a job killer."

"THE FACTS: The CBO estimated in 2010 that the law would reduce the amount of labor used in the economy by roughly half a percent."

"But that's mostly because the law will give many people the opportunity to retire, stay at home with family or switch to part-time work, since they will be able to get health insurance more easily outside of their jobs. That voluntary retreat from the workforce, made possible by the law's benefits, is not the same as employers slashing jobs because of the law's costs, as Romney implies."

"The law's penalties on employers who don't provide health insurance might cause some companies to hire fewer low-wage workers or to hire more part-timers instead of full-time employees, the budget office said. But the main consequence would still be from more people choosing not to work."

"Apart from the budget office and other disinterested parties that study the law, each side in the debate uses research sponsored by interest groups, often slanted, to buttress its case. Romney cites a Chamber of Commerce online survey in which nearly three-quarters of respondents said the law would dampen their hiring."

"The chamber is a strong opponent of the law, having run ads against it. Its poll was conducted unscientifically and is therefore not a valid measure of business opinion."

And we conclude with a double-sided spin:

3) OBAMA: "If you're one of the more than 250 million Americans who already have health insurance, you will keep your health insurance. This law will only make it more secure and more affordable."

ROMNEY: "Obamacare also means that for up to 20 million Americans, they will lose the insurance they currently have, the insurance that they like and they want to keep."

"THE FACTS: Nothing in the law ensures that people happy with their policies now can keep them. Employers will continue to have the right to modify coverage or even drop it, and some are expected to do so as more insurance alternatives become available to the population under the law. Nor is there any guarantee that coverage will become cheaper, despite the subsidies that many people will get."

"Americans may well end up feeling more secure about their ability to obtain and keep coverage once insurance companies can no longer deny, terminate or charge more for coverage for those in poor health. But particular health insurance plans will have no guarantee of ironclad security. Much can change, including the cost."

"The non-partisan Congressional Budget Office has estimated that the number of workers getting employer-based coverage could drop by several million, as some workers choose new plans in the marketplace or as employers drop coverage altogether. Companies with more than 50 workers would have to pay a fine for terminating insurance, but in some cases that would be cost-effective for them."

"Obama's soothing words for those who are content with their current coverage have been heard before, rendered with different degrees of accuracy. He's said nothing in the law requires people to change their plans, true enough. But the law does not guarantee the status quo for anyone, either."

"So where does Romney come up with 20 million at risk of losing their current plans?"

"He does so by going with the worst-case scenario in the budget office's analysis. Researchers thought it most likely that employer coverage would decline by 3 to 5 million, but the range of possibilities was broad: It could go up by as much as 3 million or down by as much as 20 million."

Just to be clear, it's me speaking now not the AP. One might wonder, in light of item 3, why not just stay with what we have now since many of us are happy with our current health care? The simple answer is that 1) the cost of health care in the USA is growing at such a fast rate that it will soon become economically unsustainable and 2) we have somewhere between 30-50 million people uninsured. A great many of these uninsured are working, not the idle poor. Paying for their care through emergency rooms costs the average family an extra $1000/year in health care premiums.

But put aside the economic cost of the uninsured to the rest of us. We live in the only advanced nation on the planet where the majority of bankruptcies are caused by medical bills and the majority of those who go bankrupt have health insurance. I think we can do better than that because we are better than that.

More balloons to pop in the coming days. Here's a little research project to undertake if you're bored in the next couple of days. Who was the first U.S. president to sign a law requiring the purchase of health insurance? Hint: The answer is not Obama.

Tuesday, July 3, 2012

Just the Straight Facts.

Suppose you were asked to stand up in front of a group--Hey, you're a teacher, you're not afraid of public speaking--and give a brief explanation of the Affordable Care Act (ACA). We're not talking opinion, just the straight scoop on what the act tries to accomplish and how it proposes to do it. Could you do it? I didn't think so.

Most of us can come up with a few "talking points" that we've read about or seen on TV, but almost nobody could give you an opinion-free, non-partisan explanation of the law in 15 minutes. Well, that stops now. Meet the Kaiser Family Foundation.

The Kaiser Family Foundation (which is not affiliated with Kaiser Permanente or Kaiser Industries) focuses on healthcare issues in the United States. They "serve as a non-partisan source of facts, information, and analysis for policymakers, the media, the health care community, and the public. Our product is information, always free of charge--from the most sophisticated policy research, to basic facts and numbers, to information young people can use to improve their health or elderly people can use to understand their Medicare benefits."

Their website ( contains many great, non-partisan presentations, but I'm going to point you to one. Please spend 15 minutes with the following link and you will have, probably for the first time, a full understanding of the ACA. This presentation was put together in 2010, after the law was signed, so references to the current year are to 2010. The law has not changed, so this presentation is still right on point. Here's the link:

Health Reform: An Overview

I don't care whether you love the law or hate it. You cannot have an intelligent conversation until you understand what the law is all about. You couldn't possibly have an easier homework assignment. Grab a cup of coffee, look and listen.

I know, I keep promising to help you separate the fact from the fiction, but this is where we need to start.

Sunday, July 1, 2012

It's so big!

One of the objections often raised to the healthcare reform law (hereafter to be referred to as the Affordable Care Act or ACA) is that it's around 2000 pages. After it was passed, there were cries of "nobody knows what's in it" and "nobody read it before it was passed."

Obviously somebody knew what was in it because it didn't write itself. To those who objected because their representatives did not read all 2000 pages, you might be surprised to know that a) many bills are large, because Congress deals with complicated stuff and b) most of the time your representatives rely on their staff to tell them what is in the bill and what it does. Truth be told, they spend a good portion of their time raising campaign funds, not reading every page of every bill.

Having said that, let's address the reason why the ACA needed to be so large: America does not have one health system, it has several and all needed to be dealt with in the bill.

Back in June of 2011 I did a series of blog posts concerning our healthcare problems and how healthcare was handled in other countries. (The first was here, you can find the rest from the sidebar once you're at the first post.) After laying out the various healthcare systems in other countries, I asked which system was used by the USA. That turns out to be a trick question. Here's part of that post:

[NOTE: "Reid" below refers to Washington Post Journalist T.R. Reid whose work is extensively quoted in my blog posts, NOT Senate Majority Leader Harry Reid.]

"You will recall that there are basically 4 healthcare financing systems in use. Here they are again, along with the countries that use them:

Method 1 - In countries that follow this model, both healthcare providers and payers are private entities. The model uses private health insurance plans, usually financed jointly by employers and employees through payroll deduction. Your doctor's office is a private business, and many hospitals are privately owned. (Germany, Japan, France, Latin America (to a degree). I didn't ask about them, but Belgium and Switzerland fit in here as well.)

Method 2 - In this system, healthcare is provided and financed by the government through tax payments. There are no medical bills; rather, medical treatment is a public service, like the fire department or public library. Many (sometimes all) hospitals and clinics are owned by the government; some doctors are government employees, but there are also private doctors who collect their fees from the government. (England, Italy, Spain, Cuba and most of Scandinavia. Hong Kong also has a version of this system.)

Method 3 - The providers of healthcare are private, but the payer is a government-run insurance program that every citizen pays into. The national, or provincial, insurance plan collects monthly premiums and pays medical bills. (Canada. Taiwan and South Korea has variations on this system.)

Method 4 - Most medical care is paid for by the patient, out of pocket, with no insurance or government plan to help. (Cambodia, India, and most other poor countries of the world.)

When we left off yesterday, the question was which of these models does the USA use. Here's what Reid has to say on that subject.

1) "For most working people under sixty-five, we're Germany, or France or Japan. In standard Bismarck Model [NOTE: that's the real name of this model first put together 125 years ago by the German ruler of that name] fashion, the worker and the employer share the premiums for a health insurance policy. The insurer picks up most of the tab for treatment, with the patient either making a co-payment or paying a percentage."

2) "For Native Americans, military personnel, and veterans, we're Britain, or Cuba. The VA and much of the Pentagon's Tri-Star system involves doctors who are government employees working in government-owned clinics and hospitals. Following the Beveridge Model [NOTE: Named after William Beveridge, the reformer who inspired Britain's National Health Service] Americans in these systems never get a medical bill."

3) "For those over sixty-five, we're Canada. U.S. Medicare is essentially a National Health Insurance [the official name of this model] scheme, with the near-universal participation and the low administrative costs that characterize such systems. Americans with end-stage renal disease, regardless of age, are also covered by Medicare; this group had enough political clout to get what it wanted from Congress, and the "dialysis community" opted for coverage under the government-run NHI system."

4) "For the 45 million uninsured Americans, we're Cambodia, or rural India. These people have access to medical care if they can pay the bill out of pocket at the time of treatment, or if they're sick enough to be admitted to an emergency ward at a public hospital, or if they have access to a  charity clinic."

5) "And yet we're like no other country, because the United States maintains so many separate systems for separate classes of people, and because it relies so heavily on for-profit private insurance plans to pay the bills. All the other countries have settled on one model for everybody, on the theory that this is simpler, cheaper, and fairer. With its fragmented array of providers and payers and overlapping systems, the U.S. healthcare system doesn't fit into any of these recognized models."

That's why the bill needed to be so large. Herman Cane said that if he were president he would not sign a bill longer than 3 pages. If Cane could do the ACA in 3 pages I wouldn't vote for him as president, but he'd make one hell of a find for a congressional staff.

This post is a little longer than I would have liked, so I will stop here and get back to the raw factfinding in a couple of days.