It was not that long ago that there was general agreement amongst the health care policy wonks that the “mandate was considered necessary for the market to work“. In reality what they meant to say was that the market needed both the individual mandate and affordable, unsubsidized health insurance to work. The Affordable Care Act(ACA) supporters realized that they could not deliver expanded benefits and affordable, unsubsidized health insurance. Expanding benefits was more appealing to their political base so they chose to kill the one thing that was essential for the market to succeed, affordable health insurance. So while the individual insurance market rotted away our courts debated whether the individual mandate was a “penalty” instead of a “tax” while maintaining that it was a valid exercise of Congress’s power to “lay and collect taxes”. The idea that the individual mandate was not as important as everyone claimed must be a grating reminder to Supreme Court justices like Justice Roberts who went out of his way to rationalize its legality. I wonder if the Supreme Court Justices learned anything from this exercise in futility.
The Irony of Repealing The Individual Mandate As Part Of A Tax Cut Package
Now after the ACA has blown up the individual insurance market, our legislators find themselves in a strange predicament. They cannot pass a health reform bill but they can pass a middle-class tax cut if they repeal the individual mandate. You got to love the idea of the nonpartisan Congressional Budget Office providing the intellectual foundation for repealing the individual mandate. What’s next? Repeal the Medicaid expansion because it would save the federal government even more money? According to their analysis, the primary source of savings comes from reduced subsidies due to healthy people leaving individual health insurance market. Avik Roy has more details in his Forbes article, How The CBO Drove Obamacare’s Individual Mandate Repeal Into Tax Reform. Although this sounds like a win-win situation, there are health insurance problems when you repeal the individual mandate. Robert Laszewski goes as far to call it a nightmare for the middle class. Then he backs off from this statement when he agrees that the repeal is good for the poor and healthy people. For the poor struggling with out of pocket costs, this is probably a better alternative than insurance. The group Mr. Laszewski says has the greatest risk are those healthy people whose income is greater than 400% of the Federal Poverty Level, who get sick, and do not have the money to pay for their illness. This sounds scary but for most major medical expenses, the combination of unaffordable health insurance and high deductibles puts this group in a more precarious financial position than going without health insurance. Earlier this year I wrote how we reduced the risk of this lesser evil.
In 2015 my wife and I came to the conclusion that the healthcare industrial complex would not willingly change their ways so we started building up our HSA. At the end of 2016, I asked our insurance company if they would offer me a lower rate. They declined and we chose to drop our health insurance. The markets are working, the customer has spoken, and our health policies are dysfunctional. Although we are nervous about our choice, we think we can do a better job managing our health care than the healthcare industrial complex. It is amazing how fast the money builds up when you divert your old health insurance premium amount into a savings account. I am mildly optimistic we can get better health care advice for non-emergency room treatments if we tell our health care providers that we are a cash customer. Every month we get by without a cancer diagnosis makes us a little more confident we made the right decision. If the insurance companies want us back all they have to do is show us an affordable health insurance plan!
In retrospect, we are a lot more comfortable with our decision now than when we started. We stuck to the plan and our emergency funds are in better shape. We are confident enough about our health that I am not sure an “affordable” health insurance plan could lure us back in. The only healthcare benefit we wish we had was the ability to add more money to our Health Savings Account.
The greatest failure of the Affordable Care Act(ACA) was its unwillingness to control health care costs. In retrospect, the ACA looks more like cronyism than meaningful health care reform. For the last eight years the hospitals, doctors, drug companies, and insurance have worked with government officials to make health care more unaffordable. In this case, I find myself agreeing with my friends on the left and the Ohio Academy of Family Physicians who said:
On August 13, the Ohio Academy of Family Physicians voted to support Issue 2, the Drug Price Relief Act, because we know something must be done so that Ohioans can afford and have access to needed medications. This initiated statute is far from perfect, simplistic, and flawed in many respects, and may not be the best approach for addressing high drug costs. But, because of the inaction of state and federal lawmakers, it is all we have. By supporting this issue, we hope to send a message to legislators—the exorbitant cost of medications and the negative impact those costs have on patients must be addressed.
I am still trying to get my head around the possible impact of the dossier in getting FISA warrants. It looks like dossier weaponized the FBI for political purposes. Almost immediately after a FISA warrant was attained to wiretap the Trump Tower in October of 2016, it was disclosed to Louise Mensch. The FBI had a history of integrity but the timing of this leak was so out of character. Now their integrity looks in peril. As I argued in the post, The #Obamagate Motive, it looks the primary objective of the FISA warrant was to discredit the Trump Campaign. In hindsight, it made the FISA court judges like a bunch of fools. This is not going to end well for the FBI!
Can Anyone Make The FBI Look Professional Again?
If the dossier played any role in the FISA warrants, I am not sure all the kings men can put Humpty Dumpty back together again. Director Comey and the FBI shredded the integrity of the FBI and for what? How does anyone including the FISA judges trust the FBI again? The fact that the dossier was funded by the Democratic party shows how far the FBI reputation has fallen. The FBI should have known who funded the dossier. Investigating is something the FBI is supposed to be good at. I would think that the last thing the FBI wanted on their resume was that they acquired any FISA warrant based on Democratic Party funded opposition research. If the dossier is all the FBI had, It makes the case that President Trump did the right thing in firing Director Comey. The fact that the dossier was circulated in the government is an embarrassment to the FBI and a source of amusement for the Kremlin. I am sorry but I am not sure anyone can make the FBI look professional again.
The American People are told the Colonies rose up against the tyranny of George III and kicked out the British because it was ‘the will of the people’.
Nothing could be further from the truth, George Washington himself stated that at no time during the War of Independence (it wasn’t a revolution) did more than 25–30% of the people support the independence movement.
I think we can all agree the man knew what he was talking about.
Primarily to see how much I learned from Constitution 101, here is what I said:
Historians name wars. The U.S. Government has no skin in this game.
The history of the independence movement is far more nuanced. I found the litany of grievances listed in the Declaration of Independence very revealing. Due to the distance from Britain, the English civil war(1642-1651), and the rise of Parliment versus the King, the colonies were largely self-managed and not taxed. It was British debt from the Seven Years’ War (1756-63) that forced Parliament to look at its North American colonies as a revenue source. In quick succession, they passed the Sugar Act of 1764, the Stamp Act of 1765, the Townshend Tariffs of 1767, and the Tea Act of 1773. The colonists resented their lack of representation in Parliament and demanded the same rights as other British subjects. Violence against tax collectors ensued. Britain responded with a political power grab and sending troops to enforce Parliament’s laws. So although only 25-30% of the colonists supported independence, even the most ardent loyalists were not happy with how Britain was treating the colonies. Although they knew it was the British thing to do, the King and Parliament were unwilling to cede even a little bit of self-rule and representation to the colonies. It was this unwavering obstinance that is key to understanding the desire for independence. By 1776 the loyalists gave up trying to negotiate a compromise. So we had a war to settle the matter.
Fighting a war for independence was revolutionary and yet so much like the English civil war. No colony had done this before. Most colonies are dependent on the mother country for financial and military support. These colonies were already self-reliant and independent. The logical next step was a power sharing arrangement that involved representation in Parliament. Britain chose a different solution and got its first lesson on the limits of global power.
In a recent opinion piece for the New York Times, Governor Kasich argued that the way forward for health care reform is more government spending. He says:
One vital improvement would be to provide adequate tax credits, which would help keep health plans in the individual market and encourage — not undermine — robust competition. Companies should also be required to continue following reasonable guardrails like ensuring minimum coverage that is genuinely useful and covers pre-existing conditions. Once we see these repairs taking hold, Congress should then take up needed improvements to Medicaid as part of comprehensive entitlement reform.
Health Care Reform Starts With Controlling Health Care Costs
The problem I have Governor Kasich’s argument is that he ignores the elephant in the room, health care costs. I can understand how the federal subsidies have benefitted hospitals, doctors, pharmaceutical companies, and insurance companies but not the consumer. Each of these groups publicly stated they were going to make health care bigger, better, faster, and cheaper. I don’t see it happening. Kasich is arguing that the health insurance markets will get better if we throw more government money at them. This is the exact same argument ACA supporters have made for the last eight years. The failure of the ACA to control costs tells us we need a different strategy if we want a different outcome. After eight years of using a carrot to encourage health care reform, maybe it is time to use the stick.
Thinking Outside Of The Box Idea Number 1 – Repeal The Individual And Employer Mandate
One of the things I learned over the last couple of years is that the individual mandate is not necessary or important. Although the ACA supporters argued in the Supreme Court that it was necessary to avoid a death spiral in the health exchanges, the consumer is largely unaffected by premium increases. It is the federal government who bears the brunt of the cost increases since the consumer’s portion is limited to 8.13% of their income. Why will the consumer leave the exchange if their payment stays the same? The primary purpose of the individual mandate was to keep unsubsidized, healthy people in the exchanges. The lack of affordable health insurance forced healthy people to evaluate their health care options. They voted with their feet.
If our politicians really wanted to help the American people by putting more money in their pocket, the simplest solution is to repeal the individual mandate. In a letter to members of Congress, IRS Commissioner John Koskinen said about 6.5 million Americans paid an average penalty of $470 for not having health insurance in 2015. Ironically these Americans are the group who can least afford the penalty. As health insurance continues to get unaffordable for more people, we should expect that fewer people will be required to pay the penalty. If the government continues to get less and less money from this penalty, maybe we should admit that the individual and employer mandate are not working and never will. This would be a great time for both parties to join together and get rid of both mandates.
Only in America is the “clenched fist of truth” more violent than a beheading.
Dana Loesch Says The Ad First Aired In April – True
Surprisingly this ad first aired in April and had 17 national airings. The NRA ads are well done and some of them are memorable. I do not remember this ad. Why the big fuss over this ad two months after its initial airing? If this is an NRA publicity stunt, the Democrats fell for it. Here is a nice synopsis of the hoopla over the ad.
Senator Portman is one of my senators and typically an astute legislator. His objection to the Senate health care bill because of the opioid epidemic is puzzling. Technically we have been fighting the opioid epidemic for several years now. In 2015 it was readily apparent to the people selected for jury duty that Clermont county had a serious opioid problem. Ohio was one of the states that expanded Medicaid. If the expansion of Medicaid has helped diminish the opioid epidemic, I don’t see any indication of it. I went to his website and could not find any details on his proposal. You would think that he would have a well thought out plan by now.
Medicaid Will Continue To Play A Major Role In Fighting The Opioid Epidemic
Most people on Medicaid being treated for drug addiction are earning less than the federal poverty limit(FPL). Drug addicts typically do not work. As an example here is a story about a drug addict from Cincinnati who was not employed, The Obamacare repeal ‘could be a disaster’ for states fighting the opioid epidemic. Medicaid coverage for people earning less than the FPL is not affected by the Medicaid expansion. The people who will be affected are those drug addicts earning between 100% and 138% of the FPL. Since I doubt there are many drug addicts in this earnings bracket, the Medicaid expansion helps fight drug addiction in a trivial sense.
Is Medicaid Part of the Problem?
Many people think the opioid addiction problem starts with doctors over-prescribing Oxycontin. Ohio’s governor is recommending:
Gov. John Kasich’s order limits the amount of opiates primary care physicians and dentists can prescribe to no more than seven days for adults and five days for minors.
SIEGEL: “In states that have the Medicaid expansion, emergency room visits are up by 9 percent. Hospitals like that because patients that used to be uninsured now have their Medicaid card. But they are flocking into the ERs to get services they don’t often need. Did you know, Brian, that 15 percent of Medicaid patients are prescribed an opioid every year? Now, that’s the doctor’s fault for over-prescribing. But Medicaid allows doctors to over-prescribe and that’s one of the secret stories that we’re breaking right now, is that the opioid epidemic is tied to Medicaid as an enabler. Doctors are the problem. Medicaid is enabling it.”
Considering our lack of success fighting the opioid addiction battle I am not sure how much additional money I would commit to Medicaid efforts to fight drug addiction. A city in the local Cincinnati area, Middletown, budgeted $10,000 this year for Narcan, the antidote of choice for overdoses. They are on track to spend $100,000 this year. Assuming that the city will get reimbursed for most of these costs by Medicaid, how does extending Medicaid compensate Middleton for the uninsured addicts. If we agree that the opioid epidemic is a public health crisis that needs to be addressed, is giving more money to Medicaid the best addiction prevention and treatment idea we can come up with?
Still Searching For Affordable Health Care Options
Prior to the ACA the individual market was the only health insurance market that demanded affordable health insurance. Compared to the small, medium, and large business markets, the individual market was aggressively priced in most states in 2011. The price increases I experienced from 2011 to 2016 led me to believe that federalizing health insurance has encouraged cronyism and corruption. I can see where the insurance companies and politicians benefited but not customers like me. If the health care industrial complex wants me back they have to offer me affordable health insurance(<8.05% of AGI) with a lot less lying.
I believe that the ACA attitude toward health care reform was best expressed by Professor Gruber’s “lack of transparency is a huge political advantage” comment. This attitude explains why we succeeded in creating a dysfunctional, unsustainable health care system that surprisingly poisoned the waters for a single payer system, too. The next health care reform needs to be less political and more honest.
If society wants to subsidize high-risk pool, chronic care, and low-income customers than it is society’s responsibility. Trying to get the smallest insurance market with the most price sensitive insurance customers to pay a disproportionate share of the cost is just plain foolish. The government should make the rules in markets they are paying the majority of the cost. Let’s start calling the subsidized market what it really is, Medicaid Plus. Let the individual insurance market have the flexibility to go back to being the spearhead of health care cost control for healthy people. Let’s make health care great again for the customers.