Friday, September 18, 2009

CNN on Social Security

Jimmy Carter says those who oppose the president are racists. Nancy Pelosi says those who oppose the president are assassins.

CNN says they're bad at math.

CNN Money has an article that initially appears to be about preparing for retirement. But it starts out trying to refute the notion that Social Security will soon be out of money, and it seems the only explanation for that is health care reform.


Really. What do we keep hearing about health care reform? "Medicare's broke, Medicaid's broke, and Social Security's broke, so why ..."

So here comes CNN:
"'Can I count on Social Security to be there?'

You can. Despite what you may hear about the system going broke, the funds from workers' payroll taxes will cover all retirees' payments until 2016 even if no changes are made to the current program. After that the Social Security Administration can cover full benefits until 2037 by cashing in its Treasury bonds from the Social Security trust fund. And when the bonds run out, income from payroll taxes would be enough to cover about 75% of payments for decades."
This is supposed to reassure us?

1) 2016 is 7 years away. That's really not that long, folks.

2) Cashing in Treasury bonds? We're broke! We can't pay our bills now, and we've been stealing borrowing from Social Security for years.

3) 75% of payments? For 100% of retirees? Something's not adding up. You mean we're going to have to cut benefits or cut beneficiaries? That sounds like another conversation we've been having -- rationing health care.

I don't think the fiscal strength of Social Security is something any retiree should count on, and it's certainly no defense for federalizing our health care system.

Thursday, September 17, 2009

Happy Constitution Day!

Today is the day we (are supposed to) stop and appreciate our constitution and marvel at the way it has (decreasingly) directed our governmet for over 200 years.

=Let's start with a classic:

=The Constitutional Sources Project has an annotated Constitution as well as many other relevant historical documents such as Madison's notes on the constitutional convention.

Friday, September 11, 2009

Real Health Care Reform

In the health care reform debate, we keep hearing that we must control costs. And then no one offers a method for actually getting and keeping costs down.

In all the states and foreign nations that have achieved universal coverage, not one has been able to keep health care costs under control, and most systems are operating under deficit spending or are rapidly approaching that point.

I have already written about some of the sources of rising health care costs, but I'd like to look at a couple here.

Defensive Medicine
Many doctors order more tests than they need to cover their butts in case of lawsuits. We cannot reform our health care system without addressing tort reform. Texas instituted tort reforms a few years ago that have been largely successful. Other states have had similar successes. I was encouraged that the President mentioned this in his address to Congress, but then he put a long time trial lawyer lobbyist in charge of "examining" the situation. The tort lottery has to change if we want to get health care costs under control.

Free Health Care is Expensive
The second major issue in medical costs is that it's free.

No, it's not free for the doctor or hospital. It's not free for the insurance provider. But it is largely free for the user -- the patient. We neither know nor care what it really costs; we just know we paid our copay and got whatever we wanted.

If I pay my $25 copay, I don't ever have to know whether the actual cost of the visit/procedure was $200, $2000, or $20,000. Why does that matter?

Free Oil Changes
Do you know how much it costs to get your regular oil change? I do. And if my bill isn't what I expect, I want to know why. If the closest garage charges too much, I go down the street.

But would I if my car insurance paid for the oil change? Probably not. I'd never even see the bill.

Consider two questions:
How much would your car insurance cost if it paid for your oil changes?

How much would an oil change cost if you didn't pay for it out of your own pocket?

Competition as Cost Control
The biggest problem with health care costs is the patient's apathy toward the cost of procedures. I recently had an ultrasound scan. I just went where my doctor told me.

If I was responsible for more of the cost, I would have gotten on the phone. If a hospital five miles away did the same procedure for $200 less, I would have insisted on going there.

And if I was interested in how much the procedure cost, both of those hospitals would be as well. Hospitals, whether for-profit or non-profit, have to have customers to stay open. If their customers become cost-conscious, so will they.

Creating Cost-Conscious Consumers
We could all decide to become cost conscious in our health care, but frankly that's not going to happen as long as someone else pays for it.

We need to change our approach to insurance. Our health insurance should work more like our car insurance. It should be catastrophic coverage -- cancer, heart attacks, car accidents -- rather than covering every conceivable procedure.

If I had to pay for every visit to the pediatrician out of my pocket, he would have an incentive to keep his costs low. Yes, we might not visit quite as often, but we're still going to take care of our kids.

Catastrophic Coverage
The key here is catastrophic insurance. Most health insurance covers a wide variety of procedures. Many states require insurance to cover all kinds of things, including therapeutic massage, fertility treatments, and birth control.

Instead, we should have insurance that only covers real emergencies. All of those other things drive up the cost of insurance. If we decrease what we expect health insurance to do, we will decrease how much we pay for it.

And all of the money that we don't spend on insurance can now go into our paychecks or, better, into a pre-tax health savings account (HSA) that would be used to pay for non-catastrophic health care.

Reform Now
Some will say this is too drastic. It's drastic, but it's not as damaging as pumping trillions of dollars into an ever expanding health care sink hole.

Some will say this would take a long time. They're right.

We can start tomorrow, though, with two very important things:

1) Universal coverage with catastrophic insurance. We can create this quickly and easily within the existing system, and we can get everybody taken care of so that no one will ever go bankrupt because of an illness again. Those who can't afford even this insurance can get help from the government or from somewhere else.

2) Tort reform, as Texas has shown, can turn things around quickly. Start there, and you will at least slow the rise of health care costs and stop the practice of defensive medicine.

After that, we can move toward a different approach to health insurance using HSAs.

Just This Once
There are those who think the only solution to our social problems, including this one, is government. Well, we tried Social Security; it's going broke. We tried Medicare; it's going broke, and what really works -- the drug benefit -- is one of the few things that the government has ever done that came in under cost estimates because of free market principles. We tried welfare; after decades and trillions of dollars, we tried some conservative solutions and finally made a dent in the problem.

Just this once, can we try the small-government solution to a social problem first? The big-government approach will always be there. But given the results in every other country that has taken that road, I think we owe it to ourselves and the next generation to think out of the box and give real cost containment a shot.

Related: Healthcare Reform: Meeting in the Middle

Recommended reading: How American Health Care Killed My Father

Thursday, September 10, 2009

Headlines 9/10/09

=Text of President Obama's address to Congress on health care reform
I'd love to go through this line by line, but the short version is: nothing new, and nothing worth much.

=Recession may be over
Great, so let's cancel the unspent stimulus -- which is the vast majority of it.

=Premature baby 'left to die' by doctors after mother gives birth just two days before 22-week care limit
"Doctors told me it was against the rules to save my premature baby."

This is one reason our infant mortality rates are higher. We would count this baby as an infant mortality; Europe doesn't.

=Daughter claims father wrongly placed on controversial NHS end of life scheme
The story I brought you a few days ago revisited in the worst way. But this is bound to happen in the name of saving money.

One Place Feds Contain Health Care Costs

In the President's big speech, I heard nothing that would really address health care costs. Our government has proven unable to contain costs with Medicare or Medicaid. Health systems in Massachusetts, Maine, and Washington, Britain, Canada, France, Germany, and Japan have all failed to contain health care costs.

But there is one place where the US government has been able to control medical expenditure: the Indian Health Service.

Our government provides single-payer health care for many Native American tribes, and they have simple plan for cost controls: Don't get sick after June.

Quite simply, the government allocates a certain amount of money, and when it's gone, it's gone. After that, if you're not "dying or about to lose a limb," you're not going to get much care.

Ok, this isn't really a scheme for cost control. It is, however, a good example of what can happen when goverment is too involved in your health care.

Is there no way to tackle the rising cost of health care?


Wednesday, September 9, 2009

Health Care Reform in Other Countries

Britain and Canada aren't the only countries with some kind of universal health care program. What else is out there?

The French health care system, lauded by many around the world, is based on a public insurance that is funded by employee and employer. "The working population has twenty percent of their gross salary deducted at source to fund the [health care] system." 20%. Just for health care. But that might be worth it to create a sustainable universal health care system.

But it doesn't. The French health system is continually in the red. People have begun buying supplemental insurance to cover what the government won't. They pay doctors much less than we do. None of this is keeping costs down. This is not a system we want to immitate.

Germany, on the other hand, has no government system. Their health care is financed solely through insurance companies, for-profit and otherwise. Everyone is required to have insurance, the premiums for which are deducted as a payroll tax. And "health care costs ... are among the most expensive in the world." I don't think this is one to immitate.

"Japan has a system that costs half as much and often achieves better medical outcomes than its American counterpart. It does so by banning insurance company profits, limiting doctor fees and accepting shortcomings in care that many well-insured Americans would find intolerable. ... Health care in Japan -- a hybrid system funded by job-based insurance premiums and taxes -- is universal and mandatory, and consumes about 8 percent of the nation's gross domestic product, half as much as in the United States. ... But many health-care economists say Japan's low-cost system is probably not sustainable without significant change."

They also experience the long waits, lack of emergency care, and shortage of specialists. Let's not immitate them either.

But there's good news! I finally found a government health care program that seems to keep costs under control. Run by our government! More on that tomorrow.

Tuesday, September 8, 2009

Health Care Reform Experiences by the States

In all the years that Congress has been debating some kind of health care reform, some of the states have tried their own hand at the matter. Let's look at a few of them.

Massachusetts has made a high-profile attempt at universal coverage. It's approach has been praised by both sides, but their experience has been that controlling costs required reducing payments to hospitals (sometimes not even covering operating costs) and excluding some who had been initially offered coverage. And the costs really haven't been controlled. In the end, I don't think it can be viewed as a viable model for a national reform to follow.

Maine has faired no better. It tried to save money by cutting payments to doctors and hospitals. It expanded its Medicaid rolls to twice the national average, but it's "public option" is so expensive low income residents can't afford it. A healthy, single, 30-year-old male in Maine pays almost 3.5 times as much for insurance in Maine as he would in New Hampshire. Premiums have increased 74%. Now new enrollment has been capped; there's a waiting list to get into the public option. Verdict? Train wreck.

Washington's example isn't a government run option; its Group Health Cooperative has been floated as a model for nation-wide co-ops. The co-op runs its own medical centers and employs the doctors; it pays them salaries instead of fee per service. It focuses on keeping patients healthy rather than treating illnesses. And premiums went up 9.7% last year and 13% again this year. Not exactly a great model for cost containment.

Oregon? They have repeated examples of the state health system declining curative treatment but helpfully offering physician-assisted suicide. 'Nuf said.

Other states have different experiences, but so far I haven't heard of any having any real luck at cost control. Universal coverage has proven to be impossible to achieve and prohibitively expensive to even approach. Does that mean we should just give up?

Has no one in the whole world come up with any solutions? We'll look at some other countries tomorrow.

Monday, September 7, 2009

Headlines 9/7/09

Barack Obama accused of making 'Depression' mistakes
"We have learned some things from comparable experiences of the 1930s' Great Depression, perhaps enough to reduce the severity of the current contraction. But we have made no progress toward putting limits on political leaders, who act out their natural proclivities without any basic understanding of what makes capitalism work."

Frugality is the new normal
...which is what we've needed for a long time. But it's gonna hurt.

A Doctor's Prescription for Legal Reform
Funny and illuminating.

Friday, September 4, 2009

Death Panels Again?

Let me start by saying the "death panel" thing was from the beginning overblown.

But it was real.

It was a sound-bite friendly way of expressing the truth that in a government-run system, the government has a financial incentive to help you die quicker. No one expects the old to be thrown into the gutter. Far from; they'd be given the best palliative care available. Just not curative care.

After all Medicare spends 80% of its funds in the last six months of a patient's life (or so we've been told repeatedly). We have to cut back, and that seems like the best place to do it.

As Anne Moore said in Salon,
"At the end of our long and increasingly longer lives, when we are terminally ill and in the last months of life, we must accept our bodies' decline, face our own mortality, gather our families and say goodbye. Say no to feeding tubes, ventilators, resuscitators, the isolation of ICU."
So should we have our doctors judge when a patient's reached those last six months and cut costs?

What if he's wrong?

Britain introduced guidelines "to help doctors and medical staff deal with dying patients, they can then have fluid and drugs withdrawn and many are put on continuous sedation until they pass away. "

But "a group of experts who care for the terminally ill claim that some patients are being wrongly judged as close to death."
"They look for signs that a patient is approaching their final hours, which can include if patients have lost consciousness or whether they are having difficulty swallowing medication.

However, doctors warn that these signs can point to other medical problems.

Patients can become semi-conscious and confused as a side effect of pain-killing drugs such as morphine if they are also dehydrated, for instance."
So are people with six years to live being denied treatment because they appear to be at the end of their lives? Maybe so.

No one appears to be claiming that anyone's out to kill Granny. But she's dying anyway.

It's a natural side-effect of government funded medical care.

Tuesday, September 1, 2009

Headlines 9/1/09

Obama to address nation's students
On the surface this seems innocuous, but given the cult of personality that exists around Dear Leader, I'm leary.

Retail Health Clinics: The Free Market is Bending the Cost Curve
Innovation, not regulation, reduces health care costs.

Seller, beware: Feds cracking down on secondhand sales of some products
Why stop at micromanaging banking, health care, and the car industry when you can run garage sales too?
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