Drive the Debate Back to Obamacare

The debate in Washington carries on. Although a deal on the debt ceiling may be fast approaching, word is that it is meant only as a deal that buys more time for the continuing resolution and funding for the American Care Act to continue. The debate needs to be swung back from the terrible side effects of a government shut down and returned to the reason for it, attempting to repeal the American Care Act. To this end, I present this essay as an argument to why having stringent criteria for the insurance industry renders the industry inept and incapable of solving the original problem America had with healthcare, the cost.

Many reports say that young, healthy people must enroll in the American Care Act (ACA) health exchanges to cover the cost of insuring people that are disproportionately sicker. It’s the corner stone of how insurance works. Charge everyone roughly the same rate for access to basically the same product. The people who use it less will subsidize the people who use it more.

The problem with the ACA or Obamacare is that the application of this perfect world scenario, as with many policies that look good on paper, is entirely impractical in practice.

In our present economic state, not only are many young people (and proportionately healthier) either unemployed or underemployed, the Consumer Financial Protection Bureau estimates that people under 40 owe 67% of the roughly $1.4 trillion that Americans owe on school loans. That’s on top of an average of several thousand dollars of credit card debt. The ACA is predicated on people who can scarcely afford the extra cost to subsidize care for small percentage of people that can neither afford insurance but also require large sums of money for their care.

In the present insurance system, younger, healthier people can purchase insurance for cheap, very cheap, and that money in premiums which rarely goes directly to healthcare for the insured can then be transferred to the populace that needs, helping subsidize their expenses so that premiums can be held below what the market would otherwise dictate. In a truly free market, people who do not need a lot of health care coverage would not be willing to spend a lot on health care coverage. The presented solution in the ADA? Force them to spend a lot.

Thus enters the government and the exchanges, forcing the disparity of premiums paid for by a healthy person and an unhealthy person to shrink to next to nothing. The trade off for the healthy is that they are now covered for a plethora of expensive drugs, services and procedures (i.e. birth control) that do very little to curb human behavior but pass more of the expense to people who would otherwise not need these services. Again, the government is dictating the conditions of which these 'markets' work.

This makes the health exchanges entirely non-progressive. The people in the equation that are spending much more now then they have in the past, people who can't afford more coverage and people that don't need more coverage. A 40% 'Cadillac' plan taxes and other provisions will help people who spend more money on health care coverage spend less. Even though in the current system that is money they freely hand over into the system.

The Government solution? Tax the rich more through a progressive tax code, then subsidize the poor who can't afford their new plans. Creating the criteria and ground work for an insurance industry that offers basically the same coverage, excludes no one, and allows money to walk from the wealthy down to the poor.

Many people, such as Jon Stewart, would look at this and cheer. Now insurance is little more then a middle man from the organization who is controlling the flow of money and dictates the criteria of care. Why not drop the failing insurance aspect of healthcare and convert to a single payer system? We'd save 10-15% and I'm sure the million or so employees of the industry would find new work in no time. Perhaps not a nightmare scenario if you have no problem handing over an entire industry to congress and whomever is in the White House at the time. Insurance is only a good deal when it actually works like insurance. Using insurance to pay for routine care and predictable healthcare needs makes it no longer insurance, but cost pooling. And once we change to a single payer system, it is almost impossible to go back.

Another flaw is that, by design, the ACA uses insurance to pay for routine healthcare services and distorts price signals and increases costs through layers of administration. ObamaCare’s requirements that insurance pay for even more routine care, especially for those who don't need it, than before codifies the fundamental flaw in the “insurance” (actually cost-pooling) “market” that we have today.

Instead, ObamaCare exacerbates and mandates everything that’s wrong with our current system while attempting to transfer costs in the exact wrong direction, from old and rich to young and poor. This is both extremely inefficient and completely unfair. The only thing that would make this worse is if Congress attempted to raise the fines for opting out enough to actually cover the enormous shortfall young people opting out in droves would create. Adding another dimension to the great scale that must find balance for an optimal and well funded healthcare system. 

In any of these scenarios though, there is one key element that is missing. None of these issues actually do anything to lower the overall cost of healthcare, the ACA simply transfers the burden of deciding who pays how much for what level of care out of the hands of the people and free markets, and fully into the hands of the government. And anyone who thinks that government efficiency can drive the cost down, I ask you to look at local property tax rates now and 100 years ago, states sales taxes now and then, federal income taxes. Government does not find the cheapest way to do anything, they are experts in finding new things that we can't live without, usually something that has such little demand that it can't exist as a private enterprise, and then charging everyone for it, regardless of who it benefits. The savings of removing insurance from the equation will be replaced with and expansion of the IRS, and premiums will simply become another tax. 

Imaging it, every hospital, every doctors office, every medical researcher at the behest of one government, there would be no profit in medicine, and without profit, the desire to create a new drug, a new life saving device, falls to those altruistic few. It's not that the government does not give dollars to research and development of new medical technologies, but we would forfeit almost all the sources of advancements that aren't funded by the government. You think that the lack of research occurring during a shutdown is frightening, In a shutdown occurring in a single payer system, all research would cease. 

Meanwhile, payouts for Medicare are dropping, funding for Medicaid is being pushed on the states who can't afford it. Hospitals and doctors offices can't afford to take too many patients with government coverage. Fewer doctors are becoming available as the number of people with coverage increase.

That is what is lost in the current battle in Washington, while pictures of war vets going through barricades and park rangers closing, well, everything. The topic that Ted Cruz spent 20 of his 21 hours addressing has been lost, and unless we can find a way to dictate the debate and steer it back to this topic then the goal of preventing the transfer of our entire healthcare system over to one entity will be lost.

No Budget, No Pay Act of 2013

In the waning hours of the day, with my wife calling me to bed, I pounded out a letter to my local congressman, Bruce Braley, to give him a piece of my mind about the current federal shut down. You may notice a bit of rosy-ness and cordial that I use when addressing a member of congress, but can you pick up on the pseudo trick question in reference the No Budget, No Pay Act of 2013.

I know the bill was a sham, despite it's name and its promise to hold congresses feet to the fire when it comes to passing a budget that would have avoiding this whole shutdown debacle, the act has no teeth. The net effect of it is that their pay is held in escrow until such a time as a resolution is passed that funds the government for 2014. With no real stipulation that it needs to be a complete budget, so they could even claim that the resolution allow active military to get paid will suffice. My attempt was to get an explanation in the fullest from Rep. Braley's office on how they can pass a bill with such a misleading name and how he can justify voting for it.  The explanation to which I will gladly share once it comes in.

On open letter to Congressman Bruce Braley (D-IA)

Greetings,

I would first like to start off by thanking you, your vote on H.J Resolution 73 for continuing authorization for the National Institute of Health was a bold move for you by not allowing these political games to get in the way of what is right for the country. It took some courage for you to break ranks of 85 the percent of the Democratic caucus that voted against this bill and I wanted to let you know that I appreciate it.

My question for you today, however, is one concerning the enforcement of a current law that is on the books, specifically, the 'No Budget, No Pay Act of 2013'. Signed into law on February 4th of this year. As I'm sure you are aware, this act was intended to put Congress on notice to pass a budget for fiscal year 2014, which began last week, or suffer the self imposed consequence of going without pay.

Did I miss an aspect of this bill? Did congress somehow fulfill it's end of this bill's deal to pass a budget for fiscal year 2014 without actually passing a budget? All I hear in the news today is how congress is one of the few entities that is truly exempt from furloughs and cuts during the federal shutdown. Or is there an aspect of this law that renders is toothless and a congressional gimmick that was never really intended to hold congress accountable for failing to keep the government moving along?

On the topic of keeping the government operating, any further insight that you can offer me, as a constituent, as to the current climate in the House of Representatives and what your plan is to help bring this current locking of horns in congress to an end.

For my part, I feel that too many debt deals and temporary. Solutions have been used to kick the can of our fiscal spending down the road. With the understanding that any form of a grand bargain is not practical both from a time constraint point of view and an ability to enforce any agreement long term, I personally feel that there are too many dangerous 'land mines' in our current system that need to be addressed to avoid a long term dilemma. I will not spend the time going down the list of arguments against the American Care Act as I'm sure you have heard them all before, but suffice to say that I feel that program will not be soluble long term and major steps need to be taken to correct some of the obvious errors that where written into it. To this end, I would ask of you, as my representative, to vote against any legislation and forces the enforcement of this law on to any unwilling citizen for at least the duration of one year, and to use that time to debate in honesty a plan to correct the many issues with this legislation.

I appreciate your fair representation you have given us to date, and pray that a fair resolution to the current embattlement can be reached. I also thank you and your staff for your service and would appreciate an email response to my concerns above, thank you.

~Chris

A Race to the Bottom

Obama insisted today that Congress pass a bill that would prevent wide spread suffering for many Americans that both parties can agree to, and then He and congress can focus on the items which they disagree.

Wait-a-minute, that wasn't today, that was last summer when Obama called for an extension of the middle class Bush-era tax cuts while they continue to debate the merits of raising taxes on the upper class (fast forward clip to about 8:30 for the specific part I'm referencing). What happened today was a complete role reversal, when the Republican dominated House brought up a bill that would have funded  the National Institute of Health (NIH), which had to put on hold a series of medical trials for the treatment of cancer that has 200 children now waiting on potentially lifesaving care.

Upon passage of this bill in the House, Senate Majority leader Harry Reid was asked if he would have the provision brought to the Senate floor to be voted on. His response raised a few eyebrows.

“Why would we want to do that?”

He also threw in a cheap shot questioning the intelligence the reporter who would ask such a question, mumbled something about how they've already addressed this issue. Then tried to explain that the House of Representatives didn't have the right to decide what the government spends money on (Double Checking Article I Section 7 of the Constitution, yeah, they kind of do). He also tried to compare Federal workers taking unpaid leave with children dying of a terminal disease.

In summary, this was potentially the worst press conference by a politician in the history of press conferences held by politicians, and he got through all of these points in just over a minute.

When millions of Americans are at risk of seeing their tax rates raising to a level that was still, by Obama's own admission, lower then when Obama took office. The Republicans buckled, the President got what he wanted, and as we all know, no discussions ever arose after the great fiscal cliff deal of 2013 about lowering tax rates for the wealthiest Americans. We are still waiting for the economic boom this was supposed to usher in. However, when hundreds of suffering children are denied a potential life saving treatment, holding on to the principle that just last year, when the stakes where that much lower, THIS is when Democrats hold firm. Ironically enough in the name of healthcare reform. Couple this with the Honor Flight incident where the White House denied a request that would have classified the visit as a First Amendment demonstration and avoided the first in what is now becoming several embarrassing displays of power and ignorance. Who is causing the suffering now?

If the last election taught us anything, it's that no matter how bad things get, no matter how horrible this President fails, his constituents will never abandon him. I personally feel that he is now exploiting this fact. He knows that both sides will suffer from this fiasco. He is making the calculated move that all this pain, all this suffering, all this stupidity, will drag down the republican side much more violently then it will the democratic one. Let's call it year round negative campaigning. It may work too because people like you and I are getting sick and tired of all of it. All of it! And the side that pays attention and is disgusted with all of it is a lot less likely to vote incumbent in 2014 then the side that seems to blindly follow and point blame to only half of Congress.