Tuesday, March 30, 2010

The health care reform bill has passed;
now we know what’s in it

House Speaker Nancy Pelosi said a short while before the House of Representatives voted on the health care reform bill that “we have to pass the bill so that you can find out what is in it,” that arrogant statement indicating that there were some surprises tucked neatly away.

During the 14 months the fight over this bill raged, Americans were opposed to most of what they knew about it, every House Republican opposed it, and 34 Democrats voted against it. Clearly, there was more to dislike than to like. Now, the bill has passed and we know what’s in it.

The attacks on the elderly and the seriously troubled Medicare program are truly breathtaking. Medicare now pays providers substantially less than their services cost, and more cuts begin this year.

In 2011: cuts begin for Medicare Advantage; the elderly are no longer allowed to use Health Care Account (FSA, HSA, HRA, Archer MSA) distributions for over‐the-counter medicine; Medicare cuts to home health begin; wealthier seniors begin paying higher Part D premiums (not indexed for inflation in Parts B/D); new Medicare cuts to long‐term care hospitals begin in July; Medicare reimbursement will be cut when seniors use diagnostic imaging like MRIs, CT scans, etc., and cuts begin for ambulance services, ASCs, diagnostic labs, and durable medical equipment.

And, additional Medicare cuts to hospitals and to nursing homes and inpatient
rehab facilities begin after October, along with cuts for dialysis treatment; Medicare will reduce spending by using an HMO‐like coordinated care model; new Medicare cuts to inpatient psych hospitals begin in July; Medicare cuts to hospice begin in fiscal 2013, accompanied by cuts to hospitals that treat low‐income seniors. In 2014 more Medicare cuts to home health begin.

Who said there won’t be rationing? And with even lower reimbursements, more providers likely will decline to treat Medicare patients.

President Obama said he wanted a bill to help people; apparently he wants to help them at the expense of the elderly.

“But those changes only affect old people,” you say? Everyone will be old someday, but at the rate Medicare cuts are being implemented, that program may not exist in 20 years.

Next year your government will impose a new annual tax on brand name pharmaceutical companies. Do you think that might cause drug prices to rise? Well, it will. And Americans must also begin paying premiums for federal long‐term care insurance.

Employers are required to report the value of health benefits on W‐2s starting in 2011, meaning folks will then have to pay income tax on the value of their health benefits.

In 2013: there will be a new tax on all private health insurance policies;, an increased Medicare wage tax of 0.9 percent; a general increase from 7.5 percent to 10 percent in the threshold at which medical expenses, as a percent of income, can be deducted; and your government will impose a 2.3 percent excise tax on medical devices, all of which will make medical care more expensive, not less expensive.

And then in 2014 individuals without government‐approved coverage are subject to what the government calls a “tax” of the greater of $695 or 2.5 percent of income. This is not a tax, however, it is a fine: How can you be taxed on something you didn’t buy and don’t own?

If you make $30,000 a year and don’t have insurance, you’ll be fined $750. Earn $50,000 and you get a $1,250 fine, just for not following your government’s demand to buy something you don’t want and may not need.

Employers who fail to offer "affordable" coverage (whatever that means) would pay a $3,000 fine for every employee that receives a subsidy through the Health Care Exchange, and employers who do not offer insurance must pay a fine of $2,000 for every fulltime employee.

What do you suppose will happen to small businesses that are marginally profitable, but can’t afford either to buy health insurance for their employees or to pay a $2,000 fine per employee for not doing what they cannot afford to do? How many people will lose their job as a result of this mandate?

Larger companies are not immune from these punishing effects. AT&T, John Deere, and Caterpillar, among others, have said effects of the reform bill will be millions of dollars each, with AT&T’s hit to be $1 billion. These additional costs will have a negative impact on how all businesses operate. Will they create new jobs or lay people off? Will they raise prices on their products?

So, while President Obama, and Congressional Democrats are popping corks on the champagne celebrating a bill that will cost $940 billion over ten years and wreak havoc on the elderly, the rest of us are wondering how we are going to handle the cost increases and health care service restrictions this bill will produce.

Opponents of this approach to health care reform said all along that a lot of improvement could have been achieved by addressing health care problems individually, instead of this massive, costly, and horribly flawed approach.

We should have listened to them.

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Thursday, March 25, 2010

Words of wisdom from a common-sense conservative

Thaddeus McCotter, Representative from Michigan, is a common-sense conservative Republican who doesn't get nearly enough exposure.

Please take a few minutes to watch and listen to this commentary on "Change" and the sad state of affairs we find ourselves in today.

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Tuesday, March 23, 2010

Washington in 2010:
Bribery and scheming and corruption, oh my!

Most Americans know who Thomas Jefferson was. He was the principle author of the Declaration of Independence and one of the most influential of the founders of this nation. He was Governor of Virginia, the first Secretary of State of the United States, and the nation’s third president, serving eight years beginning in 1801. As a major figure in the founding of the United States of America he fully understood the reasons the colonies split from Great Britain, and his beliefs were fairly representative of the people of the times who decided the oppressive and tax-crazed British government was destructive of the freedoms the Creator intended for human beings.

Mr. Jefferson had a lot to say about the form of government that best allows people to live in freedom, and one of his most famous quotes is, “That government is best which governs the least ...”

Sometime before he died in 1826 he said, “I think we have more machinery of government than is necessary, too many parasites living on the labour of the industrious.” If he believed that statement was true in or before 1826, what do you suppose he would think today?

The federal government has been too big, too expensive and too authoritarian for quite a while – nearly 200 years, according to Mr. Jefferson – but it has become intolerable this year, as so capably illustrated by the health care reform fiasco: Even though most people don’t like the bill, the leaders were determined to pass it with only Democrat support, if enough Democrat arms could be twisted to get the votes required for passage. If not, they would force it through in an underhanded scheme to pass it without actually voting on it. And while all of this was going on, states are passing legislation to prevent the feds from forcing their citizens to participate in the program, an intrusion into states rights, and are threatening to sue the federal government over it. What a circus!

Our gargantuan, wealth-consuming, non-attentive government has a legislature that is isolated from the citizenry it represents. In the early days we had a part-time citizen legislature made up of farmers and merchants, and so forth, who went to the capital for a month or two, did their work, and returned to their normal lives as farmers and merchants, and were in close touch with the people who elected them.

Today’s career politician is as far from being a citizen legislator as the Earth is from the Sun. They aren’t in Washington for 60 or 90 days and then home again; they are there their entire term of office. They have a second residence in or near DC where they live during their tenure, and even if they use the scheduled work sessions at home, going back to their home state or district is more like a vacation or a business trip. Their home is Washington, DC, not the state or district they represent.

We pay them well to be isolated from their constituents. Rank-and-file members of the Congress receive $174,000 per year, Majority and Minority Leaders receive $193,400, and the Speaker of the House receives $223,500, and all get generous retirement and health benefits funded by tax dollars, though most make contributions of their salary and also pay 6.2 percent of their salary in Social Security taxes.

If legislators were in office for only a couple of years, being separated from their constituents might not be so much of a problem, but many of them are there for decades. No wonder their priorities get confused and they forget who they work for. Combine this isolation with the pressures of partisan politics, and you have an atmosphere ripe for the sort of malfeasance we see today in the health care reform movement. If nothing else screams at you that we seriously need change in how Washington works, this should do the trick.

Anyone who participated in that disgraceful process should be removed from office, and that would be a good start to restoring honest representative government to the United States. After that, three beneficial changes should be considered:

1. Term limits for Congress. The president can serve only eight years; why should Congress be different? So, Senators get one eight-year term and Representatives get up to two four-year terms, and then home they go to become normal Americans again.

2. Limit Congressional sessions to one three-month session or two two-month sessions. Between sessions members go back to their real job and the pay that goes with it.

3. Members of Congress will be paid a salary that is a bit higher than the U.S. average income, and a housing allowance. Real emergencies may warrant longer sessions, but with reduced pay. Being in the service of your fellow Americans should not be a lucrative venture for public servants.

America’s journey from greatness to mediocrity – once a long, slow decline – has been dramatically sped up by our president and his fellow statists in Congress. Unless something dramatic happens very soon, we will live in the once-great United States.

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Tuesday, March 16, 2010

Some serious questions about the motives
of our political leaders

Are the Democrat leaders in Washington out of touch with the mood of the country? Do they have a death wish? Are they insane?

Those are serious questions, prompted by the almost incomprehensible behavior of the country’s three most visible leaders, as well as a fair number of members of Congress and administration officials.

President Barack Obama, Senate Majority Leader Harry Reid and House Speaker Nancy Pelosi seem either unable to understand that Americans are not in favor of their idea of health care reform, or they simply do not care what the people think.

Three nationwide polls reflect the mood of the country quite plainly:

• A CBS News/New York Times Poll conducted Feb. 5-10 asked, "What do you think is the most important problem facing this country today?" The economy and jobs topped the list at 52 percent, while health care garnered only 13 percent.

• The liberal Web site Daily Kos poll conducted by Research 2000 from March 8-11 asked, "Do you feel the country overall is heading in the right direction or wrong direction?" Thirty-nine percent answered the right direction, but 60 percent said the wrong direction.

• Perhaps the most telling of all is the Gallup Poll from March 4-7, which asked, "In general, are you satisfied or dissatisfied with the way things are going in the United States at this time?" Nearly four to one, Americans are dissatisfied (79 percent to 19 percent).

These polls reflect dissatisfaction with the country’s direction, which includes a dangerously intrusive and unpopular health care reform effort, but the leaders ignore this message, still obsessed with jamming through health care reform. And, not only do Americans not like the reform bills, many senators and representatives don’t like them, either.

The Senate bill needed 60 votes to pass and it took Majority Leader Harry Reid buying votes with sweet deals for a few key members to get 60 votes, and the House bill passed with only two votes more than needed. The Senate bill had no Republican support, and the House version had one Republican vote.

The next step in this compulsive exercise is for the House of Representatives to vote on the Senate bill. But some don’t like public funding of abortions, and thus don’t support the bill, and others don’t support it because it doesn’t have a public option. All in all, there’s enough stuff in the bill, and enough stuff that’s left out of the bill, that the 216 votes needed for passage may not materialize. If it passes and becomes law, the Senate will then vote for a reconciliation bill to the fix problems.

Or not. There is no guarantee that once the House passes the bill and the president signs it that the Senate will do anything, leaving features in that many object to, and leaving out things people want in. Many House members will likely support the bill only because their objections can be dealt with through reconciliation.

Undaunted by the lack of popular and legislative support for the bill, Ms. Pelosi now may resort to a scheme referred to as the “Slaughter Solution,” dreamed up by New York Democrat Congresswoman Louise Slaughter, where the House will simply “deem” the Senate bill passed by the House, which means that the president will be signing a bill into law that the House of Representatives never voted on, an act of desperation that is said to be unprecedented in U.S. history. This is underhanded, unacceptable, and probably illegal.

Here are some more serious questions: Is a bill that has the support of only one party a good piece of legislation? Isn’t good legislation that which has a broad and substantial majority of support? Did we elect these people to enact partisan legislation? And, is that the best way to run the country? The answers to those questions are: No. Yes. No. No.

What a revealing situation: In spite of negative poll numbers, in spite of crumbling support in both houses of Congress, President Obama, Mr. Reid, and Ms. Pelosi charge ahead to force health care reform through, apparently at any cost.

This behavior defies common sense. These three individuals are committed statists, and are determined to increase the size and authority of government, even if they take themselves and their party down in the process.

Their ideology is sharply at odds with America’s founding principles and is contrary to what the American people want from their public servants, but it is controlling so much of what is happening in Washington today. It appears to be more important to these leaders than their political future and the political future of other Democrats, whose re-election they expect those members to sacrifice to satisfy this lust for big government legislation with socialistic overtones that these three believe in so strongly.

Sensible Americans – Democrats, Republicans and independents – will oppose this desperate and tawdry process. They will oppose it despite what they think about the health care reform bills because they believe in the principle of good government, which is sadly missing in Washington, DC, and has reached a new low since the 2008 election.

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Tuesday, March 09, 2010

The grassroots Tea Party movement
flummoxes the left

Watching the left try to cope with the Tea Party movement is fascinating. Some evidence suggests that fear is in control, like the desperate marginalizing and demonizing of the Tea Party movement that so effectively shows the dissatisfaction of millions of Americans with government over-reaching. The left resorts to name-calling and tries to paint the Tea Party participants as a bunch of wild-eyed radicals, bent on revolution, perhaps even violence. But that is a gross distortion of these Americans, the vast majority of whom are everyday citizens merely taking advantage of their God-given and constitutionally-protected right to speak their mind.

Some on the left are unable to accept this movement as a genuine citizen protest against Big Government excesses and intrusions into personal freedom. That perspective is represented by columnist Reg Henry, who wrote last week, “If you happened to see the health care summit that President Barack Obama hosted the other day … you saw the Republicans insist with great certainty that Americans don’t want health care legislation.” Well, Mr. Henry, that’s not what Republicans said, which is that Americans don’t like “this” legislation, and are saying so loud and clear.

And as for their certainty in saying so, well, it’s because Republicans aren’t deaf or blind. They hear from their constituents, both Republicans and Democrats. They recognize that Tea Party participants are fed up with the over-bearing nature of the federal government, and the arrogant way the president and the leaders of Congress ignore their objections, and they say Congress had better not enact legislation affecting 17 percent of the economy by a 50 percent-plus-one vote when the country is so sharply divided on the issue, and Republicans are finally paying attention.

They also realize that opinion polls conducted by respected polling organizations portray the mood of the country pretty accurately, using proven and accepted methodology to randomly sample Americans who usually are registered voters, and whose statistically relevant opinions can be extrapolated to the citizenry at large with 96 percent accuracy.

They know multiple polls conducted repeatedly over several months continue to show a consistent disapproval of the direction the country is heading, ranging from 60 to 73 percent, and a small percentage of approval, in some polls as low as 22 percent.

But Mr. Henry seems to think the 2008 election was the definitive statement by the people of what they want the president and the Congress to do, even though President Obama’s campaign was one of cavernous rhetoric, devoid of detail. Furthermore, Mr. Obama’s victory margin was only seven points, 53 to 46 percent, and that isn’t a mandate to do anything. In fact, seven points is a fraction of the margin between Americans who dislike the country’s direction and those who approve of it.

Another columnist, Ann McFeatters, relies on superficial thinking and insufficient research to help her misunderstand this phenomenon, in her column taking President Obama to task “for wasting political capital and failing to get as much done as he could have.”

“The tide began to turn against health insurance reform, aided brilliantly by Republicans who began talking nonsensically, but effectively, about ‘death panels’ and socialistic medicine,” she wrote. But just because the bill does not say specifically “in our socialized medicine system there will be death panels” doesn’t preclude a mechanism evolving that will make life and death decisions based on budget considerations, nor does it mean that the system won’t become one where private health insurance cannot survive against the government’s monopolistic tendencies, and in a few years we will have socialized medicine. What Republicans did – and folks on the left didn’t do – was to look at the reform measures, and project them into the future to see what might happen.

After revealing that she didn’t look into the future to see where reform measures may lead, she blamed “Wall Street fat cats” for the recent financial crisis, showing that she also didn’t look far enough into the past to find out what really caused the financial crisis. It’s true that Wall Streeters and big bankers contributed to the collapse, but they were only playing by the rules past Congresses and administrations created for them. Ms. McFeatters only looked back a couple of years, but the government meddling that created the environment for the problem began decades ago.

She criticizes the president’s failure to fulfill promises like closing Guantanamo Bay, ending the Iraq war, and capturing Osama bin Laden. Here, she fails to consider the ramifications of his promises, or obstacles to their fulfillment. So much of what Mr. Obama promised was unrealistic, and an objective analysis showed that. But Ms. McFeatters, the news media, and 53 percent of voters didn’t analyze his promises.

No surprise that the left doesn’t understand the Tea Party movement; and no surprise that it fears its opposition. Many liberals are unable to cope with logical disagreements, and because they don’t think things through cannot present logical arguments for their ideas.

Hence, instead of working with the opposition to find common ground on the nation’s problems, the majority party tries to force its ideas on the country, which is government at its worst.

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Tuesday, March 02, 2010

Demonizing for political gain

When you want to generate a lot of support for some political program, a common ploy is to create in the minds of those whose support you seek the idea that somebody is mean, evil, wicked, bad and nasty.

The demon in the effort to impose greater government control over our health care is health insurance providers, who are attacked for all manner of improper and/or self-serving behavior, both imagined and real. House Speaker Nancy Pelosi, leading the charge, calls the insurers “villains,” but speaks in generalities and fails to show evidence of actual “villainy.”

We’ve heard the criticisms of health insurers, and some of them have done bad things. However, people in every industry and type of business occasionally do bad things, so insurers are no worse than anyone else.

The most questionable of these allegations is that the insurance companies do horrible things to their customers, such as dropping someone’s coverage when they have a serious illness; rejecting coverage for people with pre-existing conditions, or charging them higher premiums; and imposing large rate increases, in pursuit of excessive profits.

Last August Dr. Mark J. Perry, professor of economics and finance in the School of Management at the University of Michigan at Flint, demonstrated that health insurers like Cigna, Aetna, and WellPoint, had a profit margin of just 3.3 percent, ranking last on a list of 86 business categories.

People often mistakenly judge whether a company makes excessive profits by how many dollars it made. But what really is important is how much money it kept from what it collected from selling what it produced: profits divided by revenue. A multi-billion-dollar profit figure isn’t really meaningful without knowing how much revenue the company had. A company with $13.2 billion in profits and $400 billion in revenue achieved only a 3.3 percent profit margin. You can get a 3.3 percent return on your money by investing it in a three-year CD, even in today’s depressed market.

Compare that margin to more profitable business groups, like beverage producers/brewers at 25.9 percent, wireless communications at 11.1 percent, and general entertainment at 6.8 percent. If health insurers are mistreating customers for high profits, their strategy is a failure.

Most business decisions have a fundamental economic reason behind them, even large rate increases like WellPoint’s 39 percent hike in California. Fox Business Channel’s Stuart Varney explained this in the “Back of the Book Segment” on Fox News’ [begin ital] The O’Reilly Factor [end ital] recently in a segment titled “Making money off people’s illness.” "There's a recession in California and 800,000 [new participants] have gone onto Medicaid [roles],” he said. “Doctors who treat Medicaid patients lose money on every patient, and they transfer that loss to privately insured people,” which raises the insurer’s costs and creates the need to raise rates.

The title of that segment, “Making money off people’s illness,” indicates that the often- sensible Mr. O’Reilly believes health insurers are behaving immorally. But think about it: if you are in a business that deals with illness, you have to make money to stay in business and pay your employees. You must therefore make money off people’s illness. Millions of Americans are guilty of this “crime,” and we should be thankful for that. This is an example where emotion impeded clear thinking, and when this occurs people are easily taken advantage of by demagogues like Nancy Pelosi.

The Government Accounting office informs us that in 2008 the median number of insurers in individual states was 27, although that varies from a low of eight or fewer in three New England states to a few dozen in other states, and that the five largest insurers provide 75 percent or more of the policies nationwide.

Consider that there are 1,262 companies in the United States that provide health insurance, according to the business information provider, Manta. However, insurance companies are licensed by each state individually, which means that every health insurance provider might be faced with 50 different sets of criteria in order to qualify to sell to everyone in the U.S. That, and widely differing population numbers, explain why some states have dozens of providers and others have only a handful, and also why the largest companies are able to adapt to such a wide and varied set of rules, and smaller companies cannot.

Obviously, it would improve the cost and performance of health insurers if we could foster greater competition among them, and surely if we freed up all 1,262 companies to sell to anyone in the country, the variety of plans and cost levels that would emerge would satisfy the needs of the vast majority of Americans, and do so at much lower costs than we have now.

Since the Tenth Amendment to the U.S. Constitution (supposedly) protects state sovereignty against encroachment from the federal government, Congress cannot mandate uniformity of requirements for health insurers. However, that does not preclude a federal recommendation of sensible requirements that states can voluntarily adopt.

This is a vastly superior solution to health insurance reform than the destructive government takeover now being jammed down our throats by a blind, deaf and ideologically controlled Congress.

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