American Elephants


The Affordable Care Act May Not Be Affordable. Who Knew? by The Elephant's Child

The Health and Human Services inspector general has been busy. Two new audits reveal failures in ObamaCare on an astounding scale. There are unresolved discrepancies, rules violations and technology problems that expose taxpayers to unknown costs.  They bit off more than they could chew.

The HHS inspector general found 2.9 million “inconsistencies” in applications that were submitted to the federal Health Care.gov exchange during the first five months of open enrollment. “Inconsistencies” refers to things like Social Security numbers that don’t match government data, income data, family size, and citizenship that don’t check out. Around 1.3 million of the problems dealt with citizenship. An additional million involved declared income.

The inspector general was unable to resolve these “discrepancies” because the ObamaCare “eligibility was not fully operational.” In other words, who knows if the applicants were eligible to receive ObamaCare at all? Or if they are eligible are they getting the right subsidies? Are they even citizens?

Only 6 million had filled out applications by the end of February, and only 2.6 million had enrolled. Of the 300,000 problems that HHS was capable of resolving, it had only managed to clear up for just 10,000.

Eleven states ran exchanges, and had problems with 34% of the applications they had received — a total of 422,772 problems. They didn’t say if they had resolved any. The federal exchange and two state exchanges didn’t have adequate internal controls to make sure taxpayers were protected from fraud and abuse.

To top that all off, the government hasn’t been reconciling its enrollment numbers with insurance companies to account for dropouts and cancellations. Who knows how many are actually enrolled, or how many people believe they are enrolled and are not? And how many have tried to get coverage to which they are not entitled?

In the private sector, there would be criminal charges and a lot of self-important people would be heading to jail.

The president has changed the law, changed due dates, changed requirement and delayed one thing and another. How that plays out I don’t know. It’s probably one of those —”after the election” things he is so fond of.

If I understand correctly, he has promised the insurance companies that the government would (taxpayers would) bail them out if they came up short. What that means I don’t know.



ObamaCare: Fewer Enrollees, Higher Costs. by The Elephant's Child

The ObamaCare Exchanges are “disappointing” with fewer than 4 million newly insured. The Obama administration had hoped for 26 million. In April, President Obama told the nation that “marketplace” or “exchange” enrollments at 8 million customers as of March 31, had exceeded expectations and were lower than expected. The media blithely accepted the “selectively released statistics”, in spite of the administration’s habit of providing incomplete information.

The White House has not released any enrollment figures in the last 2½ months, nor do they plan to issue any updates soon. Hmmn. Government numbers included 20 percent of enrollees who did not pay their premiums. Estimates of how many were previously uninsured range from about one-third to more than half. Some who were forced out of their existing coverage find themselves having to re-enroll at much higher rates than before.

Some insurers have increased their rates by 35 percent to bring their rates into compliance with ObamaCare. So you have people with (perhaps) more benefits but for 35% more premium.

Coverage expansion in the ACA are estimated to increase federal spending by $1.383 trillion over the next two decades. Economist Greg Mankiw has estimated that the ACA or ObamaCare will reduce long run GDP in the U.S. by 5%. He insists that it is a rough estimate. University of Chicago economist Casey Mulligan says the Affordable Care Act added “about six percentage points to the marginal tax rate faced, on average, by workers in the economy. A useful rule of thumb is that taxation of $1 means that 20¢ of economic activity just never takes place.

Rates will increase significantly for next year. ObamaCare, as expected, is going to cost way more than it was planned to cost.



Health Care Costs Rose 10% In The First Quarter! by The Elephant's Child

Back in May of 2009, President Barack Obama had a big health care announcement, flanked by the heads of several major health lobbying groups: The American Hospital Association, the American Medical Association, The Pharmaceutical Research and Manufacturers of America, the Medical Device manufacturers, and the health care worker unions.

The President announced:

T]hese groups are coming together to make an unprecedented commitment. Over the next 10 years — from 2010 to 2019 — they are pledging to cut the rate of growth of national health care spending by 1.5 percentage points each year — an amount that’s equal to over $2 trillion.

The providers group said:

We will do our part to achieve your Administration’s goal of decreasing by 1.5 percentage points the annual health care spending growth rate — saving $2 trillion or more. … To respond to this challenge, we are developing consensus proposals to reduce the rate of increase in future health and insurance costs through changes made in all sectors of the health care system.

They are developing proposals about the way they might come up with a plan to cut the rate of growth of health care spending, but they don’t yet have a plan, or any idea how they could cut costs. But the cost curve was already heading down and had been for 7 years, slowing only when Democrats devised the Affordable Care Act.

Didn’t work out so well, health care costs rose by nearly 10 percent in the first quarter according to the Bureau of Economic Analysis. In 2013, costs rose only 2.4 percent.

“The rise in costs and rate of growth calls into question claims from supporters of the federal health care law, including President Obama, who claimed Obamacare would “bend the cost curve” and slow down the rate of growth in health care spending. Obama and Obamacare supporters have been trumpeting, for instance, their exceeding a goal of signing up nearly 8 million enrollees on health insurance plans by way of the laws provisions.

Over the longer term, what does track with the declining growth rate is the growth of Health Savings Accounts (HSAs), the growth in Health Reimbursement Accounts (HRAs) and the general trend toward higher deductibles. When health insurance was first offered during World War II, because wage controls prevented raises, companies offered health insurance as a way to attract workers. When health care is paid for entirely by insurance the incentive is to use more of it — and so it was. HSAs have a high deductible, but lower premiums, and the incentive is to use less of it. You don’t go see the doctor for a cold. And your savings can be rolled over tax-free from  year to year, and are there for future health care expenses.

HSAs were created by legislation in 2003. Participation in HSAs has been growing by double digits every year since than. They grew by 22% in 2012. There has been parallel growth in HRA plans, a similar plan offered by some large employers.

Republicans were inclined to wonder how Obama was going to make it all cost less while adding a huge government bureaucracy on top to administer it.

Charles Blahouse of the Mercatus Center says:

It is quite possible that the ACA is shaping up as the greatest act of fiscal irresponsibility ever committed by federal legislators. Nothing immediately comes to mind as comparable to it. …The ACA is a commitment to permanently subsidize comprehensive health insurance for millions who could not otherwise afford it, which the federal government has no viable plan to finance.

Sowell



“If You Like Your Job…” ObamaCare Will Increase Unemployment by The Elephant's Child

The Congressional Budget Office says that ObamaCare will increase unemployment. There are 7.8 million Americans working part-time who want full-time work. Mr. Obama changed the subject to raising the minimum wage.

On Tuesday no less than the Congressional Budget Office reported that the health law is causing Americans to work less or not at all, in a remarkable intellectual turnabout for the budget shop that Democrats cited repeatedly when selling ObamaCare. Now CBO—full of liberal-leaning economists—says the economy will lose the equivalent of two million full-time workers by 2017 and 2.5 million over the next decade, a threefold increase over its prior estimate.

ObamaCare’s complex design includes new subsidies, new taxes and new mandates. For low wage, lower-skilled or discouraged workers ObamaCare offers incentives that can force them to trade jobs for entitlement benefits. The CBO concludes that ObamaCare will encourage people to supply less labor by working fewer hours to qualify for more benefits. The incentives suggest watching carefully the overtime, a promotion or training in hopes of higher future earnings — it might boost you into another category with less or no subsidy. The question becomes how many people can the nation support on entitlements? I thought the numbers were already too high.

The CBO’s job-loss prediction doe not include the impact of ObamaCare’s employer mandate, which requires businesses with 50 or more full-time employees to offer insurance or pay a $2,000 penalty for each worker beyond 30 employees. The mandate has been delayed by executive order for a year. so it won’t take effect till 2015, which probably means the CBO is vastly underestimating job losses.

The White House, of course, denies everything. “Claims that the Affordable Care Act hurts jobs are simply belied by the facts in the CBO report,” the White House, in the person of Jay Carney, declared. The White House seems to mean that the report is positive because”individuals will be empowered to make choices about their own lives and livelihoods” and “have the opportunity to pursue their dreams.” Didn’t Nancy Pelosi suggest that they would have more time to do art or crafts or maybe music?

Incentives matter. People respond to incentives. And there’s nothing in the act that encourages businesses to hire more workers and be more competitive. Like “if you like your doctor,” it may include “If you like your  job…” The law is a job destroyer that is taking away rungs from the ladder of upward economic mobility.



Finally, Someone in The Media Fesses Up! It’s Not Affordable. by The Elephant's Child

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USA Today passed out a nugget of truth as a Boxing Day Gift:

More than half of the counties in 34 states using the federal health insurance exchange lack even a bronze plan that’s affordable — by the government’s own definition — for 40-year-old couples who make just a little too much for financial assistance, a USA TODAY analysis shows.

Many of these counties are in rural, less populous areas that already had limited choice and pricey plans, but many others are heavily populated, such as Bergen County, N.J., and Philadelphia and Milwaukee counties.

More than a third don’t offer an affordable plan in the four tiers of coverage known as bronze, silver, gold or platinum for people buying individual plans who are 50 or older and ineligible for subsidies. …

The prices of exchange plans have shocked many shoppers, especially those who had plans canceled because they did not meet the ACA coverage requirements. But experts are not surprised.

“The ACA was not designed to reduce costs or, the law’s name notwithstanding, to make health insurance coverage affordable for the vast majority of Americans,” says health care consultant Kip Piper, a former government and insurance industry official. “The law uses taxpayer dollars to lower costs for the low-income uninsured but it also increases costs overall and shifts costs within the marketplace.”

The law’s name notwithstanding! That’s why we call it “ObamaCare” not the Affordable Care Act.



Dear Congressmen: Are You Sure You Want To Be Exempted From ObamaCare? by The Elephant's Child

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Americans don’t like ObamaCare, and the more they learn about it, the less they like it. Obama promised that their costs would decline by $2,500 for a family of four, and they are learning that is not true. Obama promised that they would have the same excellent health care plan that members of Congress had. So when the Affordable Care Act (the formal name makes me snicker) was passed, a caveat was included that members of Congress and their staffs had to participate, just like everybody else.

Members of Congress squawked, as did their staffs, many of whom suggested they might have to resign rather than bear the cost. So of course Obama ordered an exemption for members of Congress and staffs. But he cannot do that. This the law of the land, as they keep reminding us. Not even the President of the United States can just say nevermind. It doesn’t work that way. Zero legal authority.

The Affordable Care Act requires the 11.000 people who work on Capitol Hill to purchase their health insurance on its exchanges, but many of them earn too much to qualify for subsidies. That’s a financial hit worth about $5,000 for individuals and $11,000 for families. Polls show that over 90 percent of Americans object strenuously to the special privilege the Obama  administration has delivered to members of Congress.

Republicans have voted to defund ObamaCare somewhere around 44 times, but nobody is fooled by the gesture. No member of Congress, especially Republicans, should dare face the voters next year if they have not enlisted in ObamaCare just as they are forcing the rest of the country to do. The Congress are the servants of the American people and serve at their pleasure, and can be removed at their pleasure. Yes, you won’t like it. Yes, it will cost you a whole bunch more. You put this wretched law together behind closed doors with no input from Republicans, forced it through with all sorts of sleazy deals, and passed it without a single Republican vote.

If this represents a struggle between your wallets and your principles, Republicans had better opt for principles. This one is a no-brainier. Senator David Vitter (R-LA) has been shopping around an amendment to overturn the opt-out. He is not being well received. Republicans should think again. Senator Vitter is right. And do allow all the Democrats to exempt themselves. The more of them defeated at the polls, the better.

 



The Cheapest Family ObamaCare Plan Will Cost $20,000 by The Elephant's Child

Barack Obama has unwittingly done a huge favor for Republicans. Employees at larger companies should have received their W-2 statements by now. Better take a close look. ObamaCare has required employers to add a line reporting the total cost of employer-sponsored  health-insurance coverage.For many, it will be a surprise or even a shock.

Many Americans have never given any thought to how much their employers pay for their health insurance, assuming that it is just something they get free. When they see the cost is $12.000 to $16,000 or more they may be shocked. Salaries have been lower than they might have been without health care as a “benefit.”

Republicans have long been aware that many people don’t respond to political arguments about taxes because they don’t really know how much they pay. Taxes are withheld from every paycheck and the important number for many is how big the refund is.

Many people were shocked to find that their paychecks were less on January 1, as the temporary cut in the payroll tax expired. The theory behind that was that putting a little extra in employees pockets (those who still had a job) would induce them to spend it immediately, whence those funds that were spent would through a “multiplier effect” (holy Keynesian writ to the Left) make the economy grow. Unfortunately taking that tax money out of Social Security has made the program even more fragile, and people looking sensibly at the faltering economy didn’t spend the extra money, but saved it, and there wouldn’t have been a multiplier effect anyway.

Welcome to the real world. Peter Orzag, then the director of the Congressional Budget Office, told lawmakers :

The economic evidence is overwhelming, that when your firm pays for your health insurance, you actually pay through reduced take-home pay. The firm is not giving that to you or free.

Now they are forced to disclose that number on a tax form although health benefits are not counted as taxable income — yet. The number was supposed to have been included in W-2s last year, but HHS Secretary Kathleen Sebelius gave employers a one-year reprieve.
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Surely you remember Nancy Pelosi’s ‘witty’ statement that “We have to pass the bill so we can find out what’s in it. Not so witty as it turns out. What’s in it is just plain ugly.

In a final regulation issued Wednesday, the Internal Revenue Service (IRS) has assumed the cheapest health insurance plan under ObamaCare available in 2016 for a family will cost $20,000 a year.

Under ObamaCare, Americans are required to buy health insurance or pay a penalty to the IRS.  The assumption that the cheapest plan for a family will cost $20,000 is found in the examples the IRS gives to help people understand how to calculate the penalty owed the government if they do not buy a mandated plan. And of course everybody is learning that the way they will have to cope with that is to pay the fine and wait to buy insurance until they get sick.

The White House has apparently noticed that they might lose the cases pending before the court on the religious exception, and attempted a little jiggery-pokery to try to get the complainants to withdraw, but they believe that this isn’t just a cute little thing for the hapless Tim Carney to get the assistance of the press arm compliant media to dispose of, so it wouldn’t embarrass the administration, but a matter of serious Constitutional principle. ObamaCare should collapse from the weight of its stupidities, but the White House will try to fix everything with executive orders and regulation. But ObamaCare is law, and a very bad law at that, and the fixing would have to be done by Congress.

Te favor for Republicans that I mentioned? People will learn that all those promises of” better health care that cost way less” were blatant lies.  ObamaCare is going to be way more expensive, there won’t be anywhere enough doctors, as more and more opt out of regular care for “concierge practices” or other ways to practice medicine. I know of a number who have changed what they do so they aren’t involved with the Affordable Care Act. Even the name is offensive, since the Act is making medicine unaffordable. We are moving to Britain’s NHS, the world’s worst health care in a major industrialized country, which is saving money by knocking off the old folks. Which reminds me, the administration is looking for people to serve on the “death panels.” Even in this dreadful economy, they’re not getting applicants.



The Arrogance of the President of the United States. by The Elephant's Child

Well, while the rest of us are trying to understand just what Chief Justice John Roberts has done with his ruling, it doesn’t make any difference, you see. Obama has said firmly that the Supreme Court is wrong, it is not a tax, it is a mandate. He doesn’t care what the Supreme Court says. He is the President of the United States, the most important man in the world, and he says it is not a tax.

Funny, that’s what he did with the Arizona decision. The Supreme Court said that Arizona had a right to ask those stopped for possible violations for their papers. In other words, to prove their citizenship. Obama has essentially said that he doesn’t care for that decision, and the federal government will not respond to questions about immigration status from Arizona, unless it concerns a major crime.

And then there is the Department of Justice which has announced that they don’t care if Congress has found Attorney General Eric Holder in Contempt of Congress — they will not prosecute him.

These are not the only examples. There are many, many more where the Obama administration has just chosen to ignore or to refrain from prosecuting laws passed by Congress, or take Congress’ laws as a starting point for going far beyond Congressional intent.

For example, Congress has given the EPA authority to regulate under the Clean Water Act the “navigable waters” of the United States. The EPA is taking this as authority to control any trickle that eventually flows into the waters that are actually navigable. Refusing to open Yucca Mountain Nuclear Repository, after Congress found it the most satisfactory site in the country, with transparent claims of wanting to find a better place. If you start looking for laws that the administration just refuses to enforce — they are all over the place. This is an administration that does not recognize the separation of powers, but only the exercise of its own power.

Constitutional Law professor Randy Barnett at Georgetown Law was one of the architects of the legal case against ObamaCare. In this piece, he explains the origins of the unprecedented exercises of federal power as arising in the Great Depression when political progressives managed to be allowed to regulate any intrastate activity that substantially “affected”interstate commerce.

From then until today, most law professors have taught that the power of Congress to regulate the “national economy” is limited only by congressional restraint, which means that the power is unlimited. When, in 1995, the Rehnquist Court held that Congress could only regulate intrastate activity that was “economic” in nature, the legal intelligentsia threw a fit about “conservative judicial activism.” Until today, these same experts have maintained that this was the only limitation on congressional power, which is why they and the administration were so confident of victory. Since the Affordable Care Act “regulates” economic activity, it must be constitutional.

Today, the Supreme Court definitively rejected this position by holding that mandating economic activity is not the same as regulating it, and that some means Congress chooses to regulate commerce can be improper. Today the court reaffirmed the traditional view that there must be a judicially enforceable limit on the powers of Congress. From now on, Congress will need to take the limits of its own power seriously, because it can be assured that the court will be looking over its shoulder. …

Whatever happens at the polls, however, by affirming that the Commerce Clause and the Necessary and Proper Clause of the Constitution have judicially enforceable limits, today’s decision will be a landmark of constitutional law.

Read the whole thing. Over at Powerline, Attorney John Hinderaker offers a dissent, partly joined by Attorney Paul Mirengoff while examining the same complex problem — the continual expanding of government power beyond those enumerated in the Constitution by using the Commerce Clause as justification. He sees this ruling as very narrow, limited to those in which Congress wants to regulate inaction because it affects interstate commerce. John says “I see no reason to assume that Justice Roberts voted and wrote as he did for any reason other than that he thought he was correctly applying the relevant legal principles to the case before him.”

Scott Johnson, the third attorney at Powerline, pointed out that contrary to popular belief and its own self-image, the Court has rarely been much of a bulwark on behalf of individual liberty. Certainly it has acquiesced, not just today but for many decades, in a steady expansion of federal power beyond what is contemplated by the Constitution. Again, read the whole thing, it’s not long.

Those who seek power have little concern for individual liberty, but we have never before had a president who has so little concern. He is a far-left radical, and wants “radically transforming America” to be his legacy. Unfortunately, he doesn’t understand how old and tired his arguments are, and the extent to which they have always failed wherever they are enacted.



The ObamaCare Battle Has Just Begun. by The Elephant's Child

On this one, I’m with Justice Kennedy. I cannot see the difference  between overthrowing the mandate, and then  doing the same thing and calling it a “tax.” Roberts rejected the mandate, then wrote a new law himself. A big mistake.

I am far more concerned, however, with what a remarkably bad law the Affordable Care Act, (with the Orwellian name) is. It is not affordable, and is going to be a huge tax increase on the middle class. Justice Kennedy writing the dissent said:

What is absolutely clear, affirmed by the text of the 1789 Constitution, by the Tenth Amendment ratified in 1791, and by innumerable cases of ours in the 220 years since, is that there are structural limits upon federal power — upon what it can prescribe with respect to private conduct, and upon what it can impose upon the sovereign States.  Whatever may be the conceptual limits upon the Commerce Clause and upon the power to tax and spend, the cannot be such as will enable the Federal Government to regulate all private conduct and to compel the States to function as administrators of federal programs.

The Supreme Court is upholding as a tax something that the Congress and the President swore was not a tax —allowing them to enact as a tax something that if it had been presented as a tax would never have passed Congress.

I don’t know if people are assuming that they are going to get free health care. I think some are. All those formerly uninsured people are supposed to be funneled into Medicaid, but we are already short over 50,000 physicians, with more doctors leaving  daily. I know four who have departed recently. One went to Africa, one to Montana, one simply vanished and one went to work for the Diabetes Foundation, and I know a couple who do not accept insurance at all. Our Medical Schools are unprepared to turn out significantly more doctors, which means that emergency room use will go up significantly, increasing costs.

The tax on medical devices (everything from stents and catheters to wheelchairs and diagnostic machines) is sending some companies out of the country, some are forced into massive layoffs, and some are just cutting back.  There will be significantly less innovation. Drug companies are already moving their labs abroad because of excessive regulation and long timeline for drug approvals.

The ruling was a real surprise. Opinion was very much expecting the law to be overturned. Intrade bets were over 70% that the law would be struck down. As the ruling was announced, the stock market dropped, and Mitt Romney raised $300,000 in the first hour, and is up over a million on the day.

The new law will insure more Americans, it will still fall far short of universal coverage. It is estimated that by 2019 there will still be 21 million uninsured.  The legislation will cost far more than advertised, more than $2.7 trillion over 10 years with full implementation, and will add more than $823 billion to the national debt in the first ten years. Taxes will increase by more than $569 billion between now and 2019, and the burden it places on business will significantly reduce economic growth and employment. Care will undoubtedly be rationed, for there won’t be enough doctors. As expenses grow, through the system rationing will be general.

Under the guise of implementing the law, the IRS has announced it will impose a tax of up to $3000 per worker on employers whom Congress has not authorized a tax. Yet if the IRS doesn’t impose the tax, the whole law could collapse.

Credits are available only in states that create insurance exchanges themselves. The federal government might create exchanges in states that decline, but the government cannot offer credits through its own exchanges. If there are no credits, there is nothing to trigger that $3,000 tax.

The way to ge rid of this deeply troubling piece of legislation is to get rid of Obama, and elect a Republican Senate. ObamaCare is very unpopular, and as people learn ‘what is in it’ it is sure to become even more unpopular. The fight will not be easy. Have courage.



Obama Will Send the IRS To Make You Accept ObamaCare! by The Elephant's Child

The Obama administration is not going to await the Supreme Court decision on whether the Affordable Care Act should stand. They are busy at work to ensure that the president’s health care law is implemented. The White House has allocated half a billion dollars to the IRS to put ObamaCare in place. The Hill reports that :

The Obama administration is quietly diverting roughly $500 million to the IRS to help implement the president’s healthcare law.

The money is only part of the IRS’s total implementation spending, and it is being provided outside the normal appropriations process. The tax agency is responsible for several key provisions of the new law, including the unpopular individual mandate.

The Hill also reports that the White House is spending other funding allocated under ObamaCare.

The law contains dozens of targeted appropriations to implement specific provisions. It also gave the Department of Health and Human Services (HHS) a $1 billion implementation fund, to use as it sees fit. Republicans have called it a “slush fund.”

HHS plans to drain the entire fund by September — before the presidential election, and more than a year before most of the healthcare law takes effect. Roughly half of that money will ultimately go to the IRS.

HHS has transferred almost $200 million to the IRS over the past two years and plans to transfer more than $300 million this year, according to figures provided by a congressional aide.

How does the money get spent? There are all sorts of new taxes and fees in ObamaCare, and the IRS is responsible for collecting those as well as for enforcing the mandate.  The IRS wants to hire 300 new employees next year, and has requested funding for another 537 new employees to administer ObamaCare’s new subsidies for low-and-middle income individuals to purchase insurance.

HHS plans 133 new ObamaCare-related rules as of last fall. Rulemaking related to ObamaCare legislation concerns more than 150 federal agencies, bureaus and commissions. Rules are changing faster than regulators can write them down. Administrators have granted nearly 2,000 waivers to the new regulations, and the long-term care  program CLASS, has been dropped as unworkable.

Obama has demonstrated over and over that he has no respect for the Constitution, nor for the separation of powers. He considers the Court and Congress to be impediments to his plans that must be conquered. He has no intention of meekly obeying direction. He is the One, and he intends to get his way.

 



The Rules Are Bad, Badly Written, And Devastating In Their Impact. by The Elephant's Child

You will often hear the complaint that there is no difference between the two political parties, a complaint that merely shows that the complainers aren’t paying attention.  Liberals, or Progressives as they choose to be called now, want to bring about an improved world by exerting more control over American citizens.  Conservatives want to remove unneeded regulation. Our current regulatory code tops 165,000 pages, with more regulations coming every day.  The Wall Street Journal reports today that “independent students of regulation say the quality of the many rules they’re putting out seems to be at all-time lows.”

Regulatory quality isn’t the same as content—though bad rules are usually badly written, as seems to be the case here. Rather, quality refers to a deliberative process: defining the problem; measuring costs, benefits and risks; weighing alternatives, making trade-offs, avoiding duplication; and giving the public opportunity to comment. If all goes well a quality rule will promote or at least not impair “economic growth, innovation, competitiveness and job creation,” as Mr. Obama’s January 2011 executive order on regulation had it.

A growing body of evidence suggests that the Obama administration is ignoring the basic due diligence practices that have been commonly accepted by whichever party is in power. Each regulation in the Affordable Care Act that cost over $100 million a year has been analyzed by scholars at the Mercatus Center at George Mason University.  They found the “federal government used a fast-track process of regulatory analysis that failed to comply with its own standards, and produced poorly substantiated claims about the act’s benefits and costs” that included a bias that assumed benefits would perform well, and costs would decline.

So you have rules that are assumed will perform well, and somehow cost less than expected. They got grades that were not just bad grades, they receive Fs on the regulatory curve, lower than the scores of the rules that HHS was putting out in 2009.

Here’s an example from physician Scott Gottlieb of the American Enterprise Institute:

Under the Patient Protection and Affordable Care Act (PPACA), a previously obscure government advisory body has acquired vast authority to decide which health care services Americans will have access to. The United States Preventive Services Task Force (USPSTF) was created in 1984 as a government advisor with the mission of assessing the clinical utility of preventive health measures such as screening tests and issuing nonbinding recommendations about which measures doctors should incorporate into routine medical care.

PPACA gives the USPSTF’s recommendations the force of law, making them de facto mandates on which preventive services private health plans and public programs such as Medicare must pay for. Services that do not make the USPSTF grade are unlikely to be covered at all. The USPSTF was not designed to wield this kind of sweeping and binding authority. It does not maintain the transparency, deliberative process, appeal process, or requirements for public notice and comment that are hallmarks of sound regulatory policymaking.

The Preventative Services Task Force now wields great power to decide what health services doctors should provide, yet has few checks on its sweeping authority. Doctors may go to school for years to learn how to best care for patients, but a bunch of bureaucrats in Washington will decide what they can do and what they can’t.  Cost is sure to become a major factor. In 2009 this agency decided that women age 40 to 49 should not get routine mammograms.  The USPSTF was weighing the benefit of breast cancer screening against the burden of allowing some additional cancers to go undetected. Physicians had championed earlier, more widespread screening, and the new analysis seemed callous and poorly conceived. Their advice may even conflict with the Center for Disease Control.  Now it has recommended against routine screening for prostrate cancer with a widely used blood test.

Progressives are conflicted. On the one hand, they want to add all sorts of services that seem “nice,” and raise the costs off medicine dramatically, yet the entire thrust of the healthcare program becomes one of controlling costs. Questionable statistics will rule over individual patient needs.

The supposed reason for the passage of ObamaCare was the skyrocketing costs of health care. Yet ObamaCare is dramatically raising costs even before it goes fully into effect. The main reason behind the increases in the cost of health care was the effect of government regulation — mandates imposed by Washington.

Medicine, says Dr, Gottlieb, is undergoing industrialization, where doctors are becoming owned commodities of large hospitals and health plans. In the 1997 Balanced Budget Act to cut the deficit, the Clinton administration and the Republican Congress capped total payments to doctors and implemented a system of price controls for their services. Once the work of physicians was priced by a fixed government schedule instead of rewarding the quality of their service, the only way for doctors to increase their income was to increase the volume of patients they saw and reduce the level of service — enter the 15 minute office visit.

President Obama has chosen to blame the medical insurance industry and rich doctors and big hospitals for the high cost of health care, and insisted that he could add another 46 million uninsured to the government insured rolls and yet somehow make health care cost less.  An estimated 10 million of those are illegals, the number who simply choose not to have insurance is unknown.

We had the best health care system with the best outcomes in the world. Democrats have passionately wanted single-payer government controlled health care for years. Not, as they attempt to claim because they are compassionate, but because if the citizens depend on the government for their health care, then they will reelect that government in perpetuity and return them to power. What we will get is increasingly poor care, doctors and hospitals who are forced to make cost their guideline rather than patient care.



ObamaCare Is Not a Patient-Centered System of Health Care. It’s Important to Keep That in Mind. by The Elephant's Child

How should we approach the problem of health care?  We want it to be low-cost, or as low-cost as is possible, and we want high-quality care.  Is it possible to have both?

There are two basic ways of addressing health care: a bottom-up, market-based approach and a top-down command-and-control approach.

  • A bottom-up approach is based on competition, free markets and economic incentives. It gets the incentives right for all of the individuals in the system, but doesn’t try to predict the final outcome. It tries to free people to achieve what works for the individual.
  • The top-down command-and-control version is based on rules and mandates, regulations, fines and penalties to force compliance.  It decides in advance how medicine should be practiced, and attempts to impose those results on the doctors, their patients, and on health care suppliers.
  • In the top-down command-and-control version large numbers of bureaucrats, who will never contact a doctor or a patient, will decide how medicine should be practiced, and what treatments must be used, and what treatments are too expensive and must be denied or rationed.  It depends for its success on a small group of “experts” having all the right answers. It depends for its success on the ability of those in charge to select people who are actually expert, rather than just political appointees.
  • A bottom-up approach does not know how medicine should be practiced. Competition will draw out the best practices and best practitioners. It depends for its success on the training, intelligence, creativity and innovative ability of thousands of doctors, nurses, hospital personnel, and from the industry that supplies the health care practitioners.

In the competitive, free-market world 778,000 doctors, 2.6 million registered nurses and thousands of hospital and facilities personnel get up every morning focused on how they can save or improve another life, and keep the costs down — because in a competitive world that is how they succeed.

In the top-down world, that same number of people get up every morning trying to figure out how they can squeeze another dollar out of the third-party reimbursement formulas. Because reimbursement formulas are the major way of saving money, doctors must squeeze more patients into less time.

The thing is we are dealing with human beings, and they just aren’t all the same.  In two instances of the same surgical procedure, one patient may be frail, allergic, have other problems;  the second , while needing the same procedure, may be otherwise in excellent health. To the command and control bureaucrat  the procedure gets the same reimbursement.

“Approximately one in five hospitalized Medicare patients is readmitted for a problem related to the cause of the original surgery.  The readmissions are costly and can be life-threatening.  The Medicare bureaucrats have decided, on their own, that there are 10 readmission conditions that it won’t pay for, including catheter-associated urinary tract infection and stage III-IV pressure ulcers. This has saved Medicare something less than 1/300 of 1% of all Medicare spending that year.”

Barack Obama’s stated vision of health reform is to find out what works and then go implement it. The Affordable Care Act is making millions of dollars available for pilot programs and demonstration projects. This is misguided. We know what works, the problem is replicating it.  There are examples of high-quality low-cost medicine.  If everyone went to Intermountain Healthcare in Salt Lake, the nation could reduce its health care spending by one-third, according to studies.  If everyone went to the Mayo Clinic , we could reduce spending by one-fourth. But we don’t know how to copy either one and spread it around the country.

This post is derived from John Goodman’s Health Policy Blog at the National Center for Policy Analysis.  John Goodman is the “father of health savings accounts,” a money-saving policy that has been extremely  popular with both participants and employers.  Dr. Goodman is the president and CEO of NCPA , and has been a tireless expert in the campaign to communicate patient-centered alternatives to a government-run health care system.  This blog is an excellent source for informed, thoughtful studies on the problems and potential of health care.  You can subscribe, as I do.




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