Healthcare Mythbusters (August, 2009)

I'll start by saying that I do believe our current health care system needs reform; specifically, the rules governing health insurance and the link between personal behavior and cost. I strongly think that we are on the wrong path and headed for disaster with the current health care bill proposed by Congress. After reading the first article, you now know a little bit more about this bill, so let's take a look at some of the statements the media and political "talking heads" have been feeding us.

"Over 45 million Americans lack health insurance." This statistic has been cited in many sources over the past few years, including political speeches by Hilary Clinton and President Obama. While this statistic comes from an annual report by the Census Bureau, it is misleading and misunderstood. When you take a closer look at this figure, nearly 10 million of this number are not U.S. citizens. Of the remaining 35 million, more than 17 million make over $50,000 a year, with half of those making $75,000 or more. These people could afford insurance, but choose not to pay for it. About 9 million of the uninsured already qualify for government health insurance programs, but haven't bothered to take the time to enroll. This leaves about 8 million U.S. citizens actually uninsured for reasons out of their control. It is clear that those pushing for a major government intervention in health care have been distorting this 45-million statistic to boost their cause. Why should we uproot our entire system that is functioning for 97% of the American people to benefit 3%?

"Nobody is talking about cutting Medicare benefits." Medicare is already projected to run out of money by 2020. The House bill proposes to reduce projected increases in Medicare payments to providers by more than 500 billion over the next 10 years. This will happen as baby boomers turn 65 and increase Medicare enrollment by 30%. With less money and more patients, the only option will be rationing care. According to the Congressional Budget Office, only an estimated 1% of the cuts will come from eliminating fraud, waste and abuse, leaving 99% for cutting access to care. An advisory committee will be appointed to recommend a benefits package based on standards set in the law. In addition, the bill specifically states that the government plans to eliminate some Medicare Advantage plans as a cost saving measure. 22% of all Medicare patients are currently enrolled in Medicare Advantage plans which allow seniors to buy supplemental Medicare coverage through private insurance companies. President Obama has called Medicare Advantage a wasteful subsidy for the health insurance industry and he has even proposed eliminating the entire program.

"The health care reform will not increase the federal deficit." On June 16th, the Congressional Budget Office determined that the health care reform bill proposed would cost 1.6 trillion over 10 years. This figure took many people aback, including some of Mr. Obama's fellow democrats. The White House quickly responded with a proposal for Medicare cuts. In response to this proposal, the CBO projected that we would possibly see 2 billion in savings in the second decade, a number that pales in comparison to the cost. Supporters of the reform have said that while it will increase costs and deficits in the first decade, it will make up for them in the long run, a process President Obama refers to as "bending the curve downward in coming decades." Last week, the CBO delivered another devastating blow when it stated that it does not believe current bill bends spending down. In fact, they estimate that annual growth in outlays will be 8% while annual growth in revenues will be 5%. Simple math tells us that the deficit will increase.

"Tax increases will only affect the very wealthy." President Obama has vowed to implement this health care plan without raising taxes on the middle class. Just this week, both Treasury Secretary Timothy Geithner and economic adviser Larry Summers stated that they cannot rule out higher taxes on the middle class as part of the health care overhaul. From his presidential campaign up until now, Mr. Obama has vowed to only increase taxes on those making over $250,000. Most people in this country don't realize that a tax increase on the wealthy will affect them negatively. If the government raises taxes on high income individuals, experience shows that an increase from 35-45% would change the behavior of these individuals in ways that lower their taxable income, shifting the tax increases burden to the middle class. Also, many of these "wealthy" individuals are business owners. With an increase in taxes, they will be forced to raise prices, cut jobs, and lower pay, all of which harm everyone. With income taxes aside, President Obama has already broken his pledge not to increase taxes on the middle class by increasing the federal excise tax on cigarettes and by backing the cap and trade legislation which equates to an energy tax on every person in America.

"If you like your current insurance, nothing changes except your costs will go down by as much as $2,500 per year." Rachel touched on the idea that the government can't fairly compete with other insurers. How will the Humana's of the world lower their premiums while hospitals charge them more to compensate for lower government reimbursements? How will an employer be able to walk away from the government's offer if the premiums are artificially lower than what he currently pays to privately insure his employees? As employees lose their jobs and are forced to use the public option, illegal aliens are automatically covered, and the average consumer is forced into the public option by rising prices, we will soon all be covered under one big federally run health care plan with costs out of control and life altering decisions made by the government. Back in August of last year when Mr. Obama was campaigning, he said, "If I were designing a system from scratch, I would probably go ahead with a single payer system." All this talk of a public option among the private insurance plans is just paving the way for a single payer system in the future.

In conclusion, I'm slightly optimistic that Congress has delayed the vote on the bill until after summer recess. Hopefully during these next few weeks, we the public will continue voicing our dismay with the current bill and prove to Congress once and for all that there is no place in the United Sates for socialized health care.

Healthcare Bait and Switch (August, 2009)

Congressional politicians must think we're stupid. This is the only explanation for the new healthcare bill currently being considered on Capitol Hill. It's filled with deceptive and unrealistic assertions that even a child could easily debunk. The legislation attempts to bait us with the offer of a public healthcare insurance option while carefully hiding provision after provision designed to strip our freedom of choice, rob billions from Medicare, and allow the takeover of the healthcare industry. Our Congressional "leaders" hope we won't notice. Well I sat down and read this colossal 1,000 page bill to determine the truth, and what I found is disturbing.

The claims of the public option proponents are quite ambitious: Costs will be significantly reduced! Every American will be insured! If you like your current plan, you can keep it! The quality of your care will not change! This all sounds great, but these will not happen for one simple reason: The government does not compete, it legislates. The government does not have to worry about the bottom line, which is obvious from our trillion dollar deficit. The government can operate at a loss into oblivion, while private insurers cannot. So when a politician goes on TV and claims that the government is just offering another option to "compete" with the hundreds of other private plans, that politician is knowingly lying to you.

The legislation allows the government to mandate any reimbursement rates it wishes and force hospitals to take on these patients, even at a loss, which is already the case with Medicaid. Hospitals can tell a private insurer with such low rates to get lost, but not the government. So guess who pays for these patients? You do, because of cost shifting. This is where the hospital must charge private insurance patients more in order to make up for the low reimbursement rates of government insured patients. Now imagine that millions more people are added to a public option in which the government can mandate reimbursement rates of only 70% of the cost? Your private insurance premiums must go up to compensate. Period.

The government will not compete because it doesn't have to. Maintaining a positive cash flow is not necessary and never has been. They will just keep borrowing to fund the losses. But we cannot run trillion dollar deficits forever, so the government will have to reduce healthcare costs eventually right? Wrong. The Congressional Budget Office (CBO) has already admitted that there will be zero cost savings until 2020, and then only $2 billion. That's only .006% of the cost of this bill! Only a politician would spend $1.5 trillion to claim a savings of $2 billion.

This bill has no suggestions for reducing the actual cost of providing quality care. So on page 29 of the bill, Congress admits that healthcare will be rationed instead, especially for seniors. The bill mentions Medicare 439 times, but is careful to never say exactly what changes will take place. To avoid having to give specifics, it simply establishes a new committee that will have one year to unilaterally dictate how Medicare will be altered indefinitely to fund this new public option. So our politicians are voting for Medicare modifications that aren't even clearly defined.

As an added bonus to help curb the massive costs of this legislation, the bill includes a provision to control doctor's wages. Specialists will be particularly affected. I believe that a person who sacrifices his or her entire twenties to attend medical school while incurring hundreds of thousands of dollars in student loans deserves to be well compensated. The government apparently does not agree, and as a result, fewer qualified individuals will pick this important profession.

Another worrisome point in this bill is that insurance companies will no longer be allowed to write new individual policies or change existing ones. We are constantly being told that the government plan is just another "option", so there is no real worry! This is only half true, and the proof is in section 102 of the bill. Let's say you have Plan A with insurance company X. If the government does not approve of Plan A, you must get supplemental insurance immediately. If Plan A is acceptable, you may keep this coverage as long as the insurance company still offers it. The catch is that no insurance company may offer you a new private policy or sign you onto any existing plan that you were not already subscribed to when this bill was enacted. You may not pick private plan B, C, or D to replace your original plan A, ever. Therefore if your plan is dropped, you don't have insurance, you want a different plan, or your employer (current or new) doesn't offer insurance, you have no choice about your coverage. You must accept the government plan. Insurers are only allowed to offer government-participating individual plans from this point forward, so the result will be a new market place with only employer plans and the government plan. Yes, you may keep your current insurance, but hopefully you really like it because you may never choose any other private plan.

Since the goal of this legislation is to ensure that every person in the country obtains healthcare insurance, the bill provides for a 2.5% income tax on any individual who does not have insurance as a way to encourage the uninsured to seek coverage. How will the government know exactly who these people are? Congress answered this problem by adding a provision that requires every person in America to carry a National Healthcare Insurance ID card. If a person arrives in a hospital but does not have a National Insurance ID, the hospital must report this person to the IRS so the tax may be applied. Healthcare will now be married to the IRS, and you will have to prove to the IRS that you have sufficient insurance every year to avoid the punitive tax. Of course illegal aliens and people reporting low incomes, even those who make plenty of unreported income in tips or cash wages, are exempt from the tax but enjoy a specific provision in the bill granting them free healthcare.

I could go on for hours about all of the hidden provisions in this monstrous bill. Instead, I will offer a few suggestions in lieu of the public option: Allow people to purchase insurance across state lines so they may find the best plan available, thus increasing competition and spreading risk. Allow small businesses to join together to create larger employee pools and thus lower the premiums for each person. Or when a person is laid off or fired, give that person the option to keep the same plan that he had with the employer and just pay the premiums himself. Let individuals shop for health insurance like they shop for car insurance, choosing options they need and excluding those that will never matter to them. Allow insurance companies to fully penalize those who make bad lifestyle choices, such as smokers and the obese, instead of splitting the high costs between these people and those who make positive choices. Actually having to pay for the high costs of bad lifestyle choices may encourage more people to kick bad habits and become healthier.

All of these reforms would improve the healthcare industry in a positive manner. A public option is not the answer to our healthcare problems. Costs will continue to rise while our access to quality care may be irreversibly changed. With my healthcare, I'm not willing to take that chance.