$600 Billion In Tax Increases In Health Care Bill

[SUMG]

A trillion dollars for this proposed boondoggle:

http://www.bloomberg.com/apps/news?pid=206...id=aqLNecbH0dcg

Edited June 12, 2009 by SUMG

[keith]

Can someone please explain what the fundamental problem is that Obama is attempting to address with healthcare reform? I mean really boil it down to the one, two or three basic issues.

Keith

[yyz28]

Can someone please explain what the fundamental problem is that Obama is attempting to address with healthcare reform? I mean really boil it down to the one, two or three basic issues.

Keith

The central government can't be all powerful until EVERYONE needs it for their very survival. This is what the statist wants.

...now, that's not politically correct, so you're going to be told that the 85% of us who have the healhcare coverage we choose are going to have to have our choices limited to a few (and eventually to one as the private sector can't compete with the Government) to give the 15% of the country who doesn't have health coverage (many of whom CHOOSE not to have it and are now going to have it shoved down their throats) will now be covered under the made up "right to healthcare".

That pretty well boils it down. It's a power grab. Period. A few legitimately poor will benefit, while the rest of us will suffer through rationed medicine which has failed everywhere it has been tried.

We'll see if the sheep follow THIS President off the cliff. Most wised up last time this was tried, but they have gotten smarter with the language, cost estimates (which are always WAY low with any social program) and have some momentum.

[chomp]

A few legitimately poor will benefit, while the rest of us will suffer through rationed medicine which has failed everywhere it has been tried.

Since Obama has not done a lot to flesh out exactly what the plan is, I'll reserve judgment on that until later. You do raise a good point here, how do you judge the performance of a health care system? The current U.S. system does not do very well when compared to other countries with substantially more governmental intervention in the health care sector in terms of life expectancy, infant mortality, expenditure as % of GDP, preventable deaths, etc. I ask this seriously because I am interested in people's views on the topic: Given this performance by the U.S., in what way has rationed medicine failed everywhere to a degree greater than the shortcomings of our system now?

[UNT90]

Since Obama has not done a lot to flesh out exactly what the plan is, I'll reserve judgment on that until later.

You may not get that chance. The last stimulus package was voted on and approved before it was ever read. This wil be pushed through the same way.

[UNTFan23]

Since Obama has not done a lot to flesh out exactly what the plan is, I'll reserve judgment on that until later. You do raise a good point here, how do you judge the performance of a health care system? The current U.S. system does not do very well when compared to other countries with substantially more governmental intervention in the health care sector in terms of life expectancy, infant mortality, expenditure as % of GDP, preventable deaths, etc. I ask this seriously because I am interested in people's views on the topic: Given this performance by the U.S., in what way has rationed medicine failed everywhere to a degree greater than the shortcomings of our system now?

Life expectancy, infant mortality, etc might be better in other countries, but life saving care is not as readily available if you come down with a life threatening ailment. This is why people from such countries as Canada and the United Kingdom come here for treatment. Cancer is a death sentence there when here there are treatments available.

[UNTflyer]

Since Obama has not done a lot to flesh out exactly what the plan is...

There's a reason for that.

[eulesseagle]

SUMG, et. al...........do you really think that this socialized health care is really going to cost $1,000,000,000,000?????? heck no.....what has the government done at the cost they quoted??? I would say at least 2 or 3 trillion......then a few years down the road when they have run the private health care providers off because of subsidized low costs and run all the good doctors off ..... then they will reduce the care to us because they can no longer substain the increased cost of care. Look at all the other socialized medicine countries.

[UNTflyer]

The current U.S. system does not do very well when compared to other countries with substantially more governmental intervention in the health care sector in terms of life expectancy, infant mortality, expenditure as % of GDP, preventable deaths, etc.

You can't compare us to other countries in terms of life expectancy. We are more violent, more extreme in terms of recreational activities, we drive more miles per year than the average European, and we have a generally less healthy lifestyle. NONE of that can be fixed by health care.

Here is an interesting excerpt on this topic:

There is no relationship between life expectancy and spending on health care. Greece, the country that spends the least per capita on health care, has higher life expectancy than seven other countries, including Belgium, Denmark, Finland, Germany, Netherlands, the United Kingdom and the United States. Spain, which spends the second least per capita on health care, has higher life expectancy than ten other countries that spend more.

More robust statistical analysis confirms that health care spending is not related to life expectancy. Studies of multiple countries using regression analysis found no significant relationship between life expectancy and the number of physicians and hospital beds per 100,000 population or health care expenditures as a percentage of GDP. Rather, life expectancy was associated with factors such as sanitation, clean water, income, and literacy rate.8 A recent study examined cross-national data from 1980 to 1998. Although the regression model used initially found an association between health care expenditure and life expectancy, that association was no longer significant when gross domestic product (GDP) per capita was added to the model.9 Indeed, GDP per capita is one of the more consistent predictors of life expectancy.

Yet the United States has the highest GDP per capita in the world, so why does it have a life expectancy lower than most of the industrialized world? The primary reason is that the U.S. is ethnically a far more diverse nation than most other industrialized nations. Factors associated with different ethnic backgrounds - culture, diet, etc. - can have a substantial impact on life expectancy. Comparisons of distinct ethnic populations in the U.S. with their country of origin find similar rates of life expectancy. For example, Japanese-Americans have an average life expectancy similar to that of Japanese.10

A good deal of the lower life expectancy rate in the U.S. is accounted for by the difference in life expectancy of African-Americans versus other populations in the United States. Life expectancy for African-Americans is about 72.3 years, while for whites it is about 77.7 years.11 What accounts for the difference? Numerous scholars have investigated this question.12 The most prevalent explanations are differences in income and personal risk factors. One study found that about one-third of the difference between white and African-American life expectancies in the United States was accounted for by income; another third was accounted for by personal risk factors such as obesity, blood pressure, alcohol intake, diabetes, cholesterol concentration, and smoking and the final third was due to unexplained factors.13 Another study found that much of the disparity was due to higher rates of HIV, diabetes and hypertension among African Americans.14 Even studies that suggest the health care system may have some effect on the disparity still emphasize the importance of factors such as income, education, and social environment.15

[keith]

Obama seems to have a solution, but I don't think he has adequately defined the problem. The solution seems to be a government take over of, or at least a greater role in, individual health care decisions. Before that happens I really think the problem needs to be clearly defined.

Keith

[Harry]

Can someone please explain what the fundamental problem is that Obama is attempting to address with healthcare reform? I mean really boil it down to the one, two or three basic issues.

Keith

Keith here is my summary of the current situation, and I apologize for the length but I could only get it covered in 5 points:

Healthcare Reform is Necessary. Most agree that our health care system needs to be reformed. Who has not experienced or knows someone in their lives that has been impacted financially due to a lack of medical coverage? Big Corporations like GM can't compete globally because of the rising costs of their health benefits. Small businesses are being crippled and are shifting costs to families. Over 60% of all bankruptcies are due to medical bills. The costs associated with health care continue to skyrocket and there appears to be no relief in sight. Large, small companies and of course individuals and families are all impacted. We have a Medicare system that pays doctors more for the number of procedures they perform instead of the quality. There are very few Americans that don't have some level of concern over rising premiums and out of pocket costs. It seems that the coverage they need costs more every year, and the amount of coverage they purchase lessens in terms of actual benefit which ultimately leads to higher out of pocket costs. Even the parties who defeated health care reform back in the Clinton era (Big Insurance, Pharmaceuticals, AMA, and Hospitals etc) are in agreement that there needs to be a fundamental change in how health care is structured. So the question is not whether or not there will be reform, but rather the amount and level of changes the reform will address.

Universal Coverage Mandate. Part of what is costing so much is the movement towards offering universal coverage, mandating that the insurance companies can't deny Americans who apply for health insurance coverage and allowing a basic level of coverage for all. Right now 46 million Americans don't have health insurance. Is it right that insurance is only for the healthy and wealthy? Many Americans are denied insurance coverage because of the fact they are considered higher risk or have a pre-existing condition. Women are required to pay more than men. In group coverage, employees that are overweight, smoke and drink often are being subsidized by people who take care of themselves. There is no focus or incentive for wellness and prevention. The health insurance industry is driven by revenues and profits and they would much rather receive a premium versus pay that money out to doctors and hospitals. On the flip side, insurers and other special interests look to gain significantly by a Universal coverage mandate because the amount of members they would cover would more than double. This increase in revenue for insurance and providers makes this mandate the least volatile at this stage of the debate.

Public Plan. The public plan is a mostly Democratic supported idea which has the blessing of President Obama. The idea is to create a public, not-for-profit government sponsored health plan like Medicare to compete against the private for-profit insurance carriers for participation. This would give consumers another option if a private insurance company denied coverage or significantly raised premiums from a not-for-profit entity. Republicans see this program as a Trojan horse that would ultimately run the private insurance companies out of business and lead to a single payor system, i.e. like Canada, France etc. Obama and the Democrats maintain that if you like your current coverage you can keep it and they will not do anything that will change it. They see this public option as a good way to keep the insurance companies competitive and provide consumer options. Debate on the public plan has become quite intense and some of the Republicans have labeled it a "Deal Breaker". There have been some discussions around replacing the "public plan" concept with health care "Co-ops" that are owned and controlled by the workers and the people who use its services, and are not run by the government. the Public Plan is by far the most bitterly contested issue in the entire reform debate and threatens to slow down or even damage the entire reform process.

Costs. Health care costs have been spiraling upward. Expenditures in the United States on health care surpassed $2 trillion in 2006, almost three times the $714 billion spent in 1990, and over eight times the $253 billion spent in 1980 (Kaiser Foundation). So the system clearly needs to change from its current path or it will have a disastrous impact on our economy. Estimates indicate that it will cost $150 billion to provide coverage of the current 46 million uninsured. To even come close to making this a budget neutral proposition you will have to raise taxes and the question becomes where do you raise them? There has been a lot of debate over removing the current employer tax exemption for health benefits. The Joint Committee on Taxation estimates that taxing employer benefits above the value of the Federal Employees Health Benefit Plan, adjusted for inflation, would generate nearly $420 billion over the next 10 years. There have also been discussions around implementing "sin" taxes for items like tobacco and alcohol but they would not generate near the levels needed. With the economy in the shape it is right now, getting around the "how will we pay for this" issue has proven difficult for Obama and the Dems. Right now as I type this, the Congressional Budget Office (CBO) is crunching the numbers and their final determination or projection of what these policy changes will cost should have a huge impact on the entire debate and ultimately what bill passes.

Politics. Obama wants a bipartisan bill but stands firm on certain aspects like the Public plan. He was initially satisified with letting congress duke out the more thornier aspects of the bill but is starting to get more engaged. His grassroots, social media campaign is organizing and starting to get some traction. The Republicans led by senator Charles Grassley have been the most vocal and vigorous in this debate, in particular against a Public option. The Democrats have been more cautious. Their leader on healthcare, Senator Edward Kennedy is battling brain cancer and has not been able to be in the public limelight, instead working behind the scenes as he continues his treatments. The more liberal Democrats continue to draft bills that include the public option. The "Blue Dog" or fiscally conservative Democrats in the House are not as excited about the public plan and have grave concerns over the 1.8 trillion dollar budget gap that would be extended another 1.5 to 2 trillion in 10 years if expanded coverage is provided through health reform. If Obama's dream of bipartisan healthcare reform legislation falls victim to a Republican and Democrat stalemate, he may have an ace in the hole in the budget reconciliation bill. This would require only 51 Senate votes for passage of a health care reform bill instead of the typical 60 needed to authorize new programs. Still, passing legislation and implementing it is two completely different things. History says you really need a bipartisan effort to get something this big off the ground, so the reconciliation process would likely be a last resort.

[keith]

Thanks Harry for the thorough review. It seems like this is something that you are fairly close to. I've read though your post several times looking for a problem definition and possible root cause and I'm still struggling with this. Before I make a stab at it, I have a few comments and questions about some of the things you have provided, it is definitely thought provoking. Although I've taken some snippets out of your text, these comments and questions are not directed at you personally, I'm just throwing them out there as they came to me.

Over 60% of all bankruptcies are due to medical bills.

Where does this number come from? Is this for business bankruptcies or personal bankruptcies? If this number is for personal bankruptcies, were these for people with or without medical insurance?

We have a Medicare system that pays doctors more for the number of procedures they perform instead of the quality.

Medicare is currently administrated by the Federal government, right?

Right now 46 million Americans don't have health insurance.

Where does this number come from? Rather than just throwing out a large number like this, I think it would be more meaningful if the circumstances as to why these 46 million Americans (are they all citizens?) do not have health insurance were broken down. If we assume this number is correct and say there are approximately 330 million Americans, that means (330M - 46M) / 330M = 86.1% of all American citizens have health coverage. That's a fairly healthy percentage (no pun intended).

Is it right that insurance is only for the healthy and wealthy?

I'm sorry to say, but this seems like a liberal battle cry. Given the percentages above that means that 86.1% of all Americans are both healthy and wealthy.

The idea is to create a public, not-for-profit government sponsored health plan like Medicare to compete against the private for-profit insurance carriers for participation.

So, we are doing all this for 13.9% of the population some of which could most likely afford health insurance today but are either not interested or do not think it is important enough. Didn't we already determine that the government run Medicare system is no good?

Health care costs have been spiraling upward. Expenditures in the United States on health care surpassed $2 trillion in 2006, almost three times the $714 billion spent in 1990, and over eight times the $253 billion spent in 1980 (Kaiser Foundation).

Costs have certainly been growing faster than just about everything else and is significantly out pacing inflation. The big question is why? How much are we now spending on the last year of life? How much of these expenditures are discretionary? Everyone expects medical miracles these days and wants the absolute best care available. Plain and simple, advanced medical technology costs money. We are fortunate to live in a country that has at its disposal the most modern and advanced medical technology available. What about the other factors that go into the cost of health care? I think this is the key area to investigate and attack IMHO.

Estimates indicate that it will cost $150 billion to provide coverage of the current 46 million uninsured.

This is annually, right? That's $3,260 in medical expenses (or is that insurance?) for each and every one of those 46 million people. Are these the sickliest people on the planet? I have a family of 5 and with the exceptions of the years my children were born, I have not come close to those medical expenses for my entire family. I'm talking about actual costs, not my out of pocket costs. If you tell these people they have "free" health care, they will go to the doctor for every sniffle, cut or ache and pain. If, on the other hand, you gave them the $3,260 and said that's your medical budget, you get to keep whatever you don't spend on medical care, they would be very judicious about going to the doctor. There is an old saying, physician heal thyself. That's the weird thing about old sayings, they are almost always right.

To me, I think this all boils down to cost. I suspect that less and less of the total costs is actually directly related to providing health care services. In my opinion, if we could get the costs under control and back to some sense of rationality, then most of the other problems would go away. We need one of those pie charts that shows where and what percentage of each dollar spent on health care really goes. I think we'd all be shocked.

There is a general practice family doctor up in the New York area that go so fed up with the mess that he decided to stop accepting any insurance. He simply charged a flat-rate fee of $79 for office visits and most procedures. The state government when nuts and told him he could not do that. Huh, what? The state said he wasn't allowed to charge rates that low. They shut him down. There was enough of a public uproar that the state finally backed down and let him run his practice as he saw fit.

Keith

Edited June 14, 2009 by keith

[meangreendork]

This is annually, right? That's $3,260 in medical expenses (or is that insurance?) for each and every one of those 46 million people. Are these the sickliest people on the planet? I have a family of 5 and with the exceptions of the years my children were born, I have not come close to those medical expenses for my entire family. I'm talking about actual costs, not my out of pocket costs. If you tell these people they have "free" health care, they will go to the doctor for every sniffle, cut or ache and pain. If, on the other hand, you gave them the $3,260 and said that's your medical budget, you get to keep whatever you don't spend on medical care, they would be very judicious about going to the doctor. There is an old saying, physician heal thyself. That's the weird thing about old sayings, they are almost always right.

To me, I think this all boils down to cost. I suspect that less and less of the total costs is actually directly related to providing health care services. In my opinion, if we could get the costs under control and back to some sense of rationality, then most of the other problems would go away. We need one of those pie charts that shows where and what percentage of each dollar spent on health care really goes. I think we'd all be shocked.

There is a general practice family doctor up in the New York area that go so fed up with the mess that he decided to stop accepting any insurance. He simply charged a flat-rate fee of $79 for office visits and most procedures. The state government when nuts and told him he could not do that. Huh, what? The state said he wasn't allowed to charge rates that low. They shut him down. There was enough of a public uproar that the state finally backed down and let him run his practice as he saw fit.

Keith

You're touching on something pretty close to a major contributor of healthcare costs - and that's the people procrastinate about their medical conditions. The sort of people who wait until a minor sickness becomes a major ailment, and end up in the emergency room instead of the doctor's office as a result. I think part of the plan is to at least attempt to educate the people who do this sort of thing into seeking care beforehand, and avoid conditions that tend to aggravate or cause problems, such as obesity. Maybe providing a set budget for standard care and non-emergency, but more serious treatment isn't a bad idea.

I'm with you on the actual apportionment of each dollar spent on medical care service and medical insurance. I know a husband/wife team that used to run their own private practice in the Richardson/Garland area and some of their gross income from the practice went to handling malpractice insurance, which apparently becomes a bigger and bigger issue because so many people are inclined to launch lawsuits these days.