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Archive for the ‘Health Reform’ Category

At the risk of understatement, Obamacare is a mess.

It’s been bad for taxpayers, bad for consumers, and bad for healthcare.

It’s even been bad for some of the special interest groups that backed the legislation. The big insurance companies supported the law, for instance, because they thought it would be good to have the government force people to buy their products.

And these corrupt firms even got a provision in the law promising bailouts from taxpayers if the Obamacare system didn’t work.

Given the miserable track record of the public sector, that was probably a crafty move.

But the companies mistakenly assumed their sleazy pact with Obama, Pelosi, and Reid was permanent. Fortunately, their Faustian bargain appears to be backfiring.

Senator Marco Rubio has led the fight to stop bailouts for the big insurance companies.

Here are some excerpts from his recent column in the Wall Street Journal.

Six years after being signed into law, ObamaCare is a costly and unsustainable disaster. …ObamaCare is also bringing out corporate America’s worst crony-capitalist impulses. The health-insurance lobby has teamed up with trial lawyers to sue the federal government—through individual lawsuits and a $5 billion class action—for not following through on a sweetheart bailout deal buried in the law. This provision of ObamaCare would have required taxpayers to bail out insurers.

But in a rare victory for taxpayers, the Florida Senator got the law changed to restrict bailouts.

My conservative colleagues and I sounded the alarm about the likelihood of a taxpayer-funded bailout of health insurers (and were mocked as Chicken Littles for it). …When it came time to pass a spending bill at the end of 2014, we succeeded in making it the law of the land that the ObamaCare bailout program could not cost taxpayers a single cent—which ended up saving taxpayers $2.5 billion. In December of last year, we came back and repeated the feat. Now I am urging leaders in both the House and Senate to make this a priority and stop the bailout a third time.

As you might imagine, there’s a counterattack by the corrupt insurance companies that conspired with the White House to impose Obamacare on the nation.

…the health-insurance companies are suing to try to get their bailout…professional attorneys from the Congressional Research Service…said that the administration’s practice of making other payments to insurers under the ObamaCare reinsurance program “would appear to be in conflict with the plain text” of the law. …Health insurers can hire all the high-paid trial lawyers they want, but they will run into a constitutional buzz saw: America’s founding document grants Congress the power of the purse… Health-insurance companies need to wake up to the reality that this…money they are fighting for, and that the Obama administration is trying to weasel a way to somehow give them, belongs to taxpayers. Taxpayers get to decide—through me and others in Congress—whether to bail them out. And the people have spoken: No, we will not bail out health insurance companies for ObamaCare’s failures.

Amen to Senator Rubio.

Let’s hope Congress continues to oppose bailouts, and let’s also hope the White House isn’t successful in somehow giving our money to the big insurance companies.

Speaking of which, here’s what Investor’s Business Daily wrote about the bailout controversy.

Right when you think Washington can’t get any worse, it does. That much was evident at a recent U.S. House of Representatives committee hearing into the Obama administration’s bailout of private health insurance companies. It’s a textbook case of government officials ignoring federal law to put special interests before the interests of American taxpayers and families.

Here’s how the mess was created…and how the Obama White House chose to respond.

Thanks to the Affordable Care Act’s labyrinthine mandates, health insurance companies have collectively lost billions of dollars on the exchanges, leading to an increasing number of them limiting their participation in or exiting the exchanges altogether. As a result, many insurers have demanded larger subsidy payments. …responding to insurance industry demands — in November the Obama administration promised to “explore other sources of funding” for payments to insurers. Yet rather than work with Congress, the administration flouted the law entirely — and in this case, that means using tax dollars to bail out insurers left on the exchanges. CMS simply decided to ignore the law.

Unfortunately, ordinary people don’t have that option.

They simply pay more to get less.

Meanwhile, Americans rightly wonder who’s looking out for them. Premiums have actually risen faster in the five years after passage of the Affordable Care Act than in the five years before, while deductibles average nearly $3,000 for the most popular exchange plans.

Isn’t that typical.

Big government makes life worse for the average person while the special interests get special deals.

Speaking of special deals, let’s look at another Obamacare rescue for a privileged group.

Bob Moffit of the Heritage Foundation explains the contortions needed to keep health insurance subsidies flowing to Capitol Hill.

…one scandal is truly bipartisan: How key administration and congressional officials connived to create, under cover of the Affordable Care Act, also known as Obamacare, special health insurance subsidies for members of Congress.

Here’s the background.

Rushing to enact the giant Obamacare bill in March 2010, Congress voted itself out of its own employer-sponsored health insurance coverage—the Federal Employees Health Benefits Program. …But in pulling out of the Federal Employees Health Benefits Program, they also cut themselves off from their employer-based insurance contributions.

Subjecting themselves and their staff to Obamacare may have been smart politics, if only to avoid the charge of hypocrisy, but that created a different problem.

Obamacare’s insurance subsidies for ordinary Americans are generous, but capped by income. No one with an annual income over $47,080 gets a subsidy. That’s well below typical Capitol Hill salaries. Members of Congress make $174,000 annually, and many on their staff have impressive, upper-middle-class paychecks. …Realizing what they had done, congressional leaders sought desperately to get fatter taxpayer subsidies in the Obamacare exchange system. …The standard excuse was that, without a special “sweetener,” a Capitol Hill “brain drain” would ensue; the best and brightest would flee to the private sector to get more affordable employment-based coverage.

Gee, it would have been a shame if the people who have screwed up public policy had to get jobs in the private sector (or, more likely, the parasitic lobbying sector).

But the law oftentimes is not an obstacle when the Obama White House wants something to happen.

…at a July 31 closed-door meeting with Senate Democrats, President Barack Obama had promised he would “fix” the mess they made of their health coverage. So, on Aug. 7, 2013, just as Congress was getting out of town for the August recess, the Office of Personnel Management ruled that members of Congress and staff enrolled in the exchange program would get Federal Employees Health Benefits Program subsidies, even though they were no longer in the program.

But how exactly did the White House evade the law?

…the Office of Personnel Management declared that Congress and staff were eligible to enroll in the Washington, D.C., “SHOP” Exchange, a health insurance exchange reserved for small businesses with fewer than 50 employees. The exchange offers special insurance subsidies to participating small businesses. The problem was, of course, that Congress is not a “small business,” at least under any clinically sane definition of the term, and no section of the Affordable Care Act provided for any congressional exemption from the ban on large employer participation in the SHOP exchanges.

By the way, as a former staffer on Capitol Hill, I do have some sympathy for the lower-level folks who didn’t create the Obamacare mess and would suddenly be in a position of having to pay all their health costs out of pocket if the law was obeyed.

But that’s not a reason to engage in legal chicanery.

As part of tax and entitlement reform, by all means let’s shift to a system where we address the third-party payer crisis by having most health care expenses directly financed by consumers (reserving insurance for large, unpredictable expenses). That new system should include all people, including politicians and their staff.

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What’s the worst loophole (properly defined) in the cluttered internal revenue code?

I think the deduction for state and local taxes is very bad policy since it enables higher tax burdens in states such as California, New Jersey, and Illinois. The exemption for municipal bond interest is another misguided provision since it makes it easier for states to finance spending with debt.

Special favors in the tax code for ethanol also deserve scorn and disdain, and I’m also not a fan of the charitable deduction or the ways in which housing gets preferential treatment.

But if I had to pick just one tax preference to repeal, it would be the so-called healthcare exclusion. This is the policy that enables employers to deduct the cost of health insurance policies they buy for their employees.

You may think that deduction is reasonable. After all, employers also can deduct the wages and salaries they pay their employees. But here’s the catch. Employees pay tax on their wages and salaries, but they don’t have to pay tax on the value of their health insurance, even though such policies obviously are a form of compensation.

Moreover, since this type of compensation is shielded from both income taxes and payroll taxes, the playing field is therefore very tilted, which generates some very perverse results.

First, some background. As part of a broader analysis of the non-taxation of fringe benefits, Scott Greenberg of the Tax Foundation explains how government has created a big incentive to take income in the form of fringe benefits rather than wages and salaries.

…eighty years ago, it was relatively uncommon to offer workers compensation other than their regular wages and salaries. In 1929, only 1.9 percent of employee pay took the form of fringe benefits. By 2014, fringe benefits had risen to 19.2 percent of worker compensation.

Here’s a chart looking at the historical data.

Greenberg says this distortion in the tax code is unfair.

…the growing trend of unreported fringe benefits is “inequitable and inefficient.” This claim is spot on. For an illustration, imagine two employees, one of whom makes a salary of $100,000, and one of whom makes a salary of $80,000 and benefits worth $20,000, which largely go unreported. Although both workers receive the same overall compensation, the first employee is subject to a significantly higher tax burden than the second, which seems plainly unfair.

Moreover, the distortion lures people into making economically foolish choices.

Furthermore, this arrangement incentivizes companies to shift more compensation towards benefits, to help employees avoid taxes. This leads to an inefficient allocation of resources, towards services that employers might not have been willing to pay for in the absence of tax incentives.

He’s correct

Writing for the Weekly Standards, Ike Brannon looks specifically at the biggest tax-free fringe benefit.

…allowing employers to provide health insurance tax-free to their workers is terrible policy, a truism that any honest economist—whether liberal, conservative, or otherwise—would agree with. …First, workers end up with more health insurance than they would ever purchase on their own (since tax-free health insurance is worth more than income that’s taxed at 30%-50%), which gives people less take-home pay to spend as they see fit. Second, more generous health insurance entails lower co-pays as well as other provisions that insulate the worker from the actual cost of their health care. As a result, people become less sensitive to prices when seeking health care, and they consume more of it—most of which does nothing to improve health outcomes, numerous studies have shown.

For further details on this unfortunate tax preference, A. Barton Hinkle looks at the evolution of the health exclusion in a column for Reason.

…the original sin of the American health-care marketplace…was committed back in World War 2, when inflation led workers to demand higher wages – which many employers could not afford to pay because of price controls. …With wages frozen, employers needed another way to compete for labor made scarce by the draft. So some began offering health coverage. The practice took root, spread, and outlasted the war. In 1949 the National Labor Relations Board ruled that health benefits counted as wages for the purpose of union negotiations. Five years later, the IRS ruled that health coverage was not taxable income. The result was a double incentive for employers to offer fatter health benefits in lieu of fatter paychecks. …The result: a skyrocketing, ultimately unsustainable increase in national outlays for health care. …In short, for decades the federal government has encouraged employers to provide gold-plated health-care plans.

Joe Antos of the American Enterprise Institute explains how the “healthcare exclusion” is bad fiscal policy, bad health policy, and bad economic policy.

If we hope to move to an efficient healthcare system that is fair to everyone, Congress will have to take on the largest subsidy in the tax code. …Premiums paid for employment-based health insurance are excluded from federal income and payroll taxes.

When describing provisions that allow people to keep more of their own money, I would prefer to say largest distortion rather than largest subsidy, but I realize I’m being pedantic. Regardless of word choice, the net effect of this preference is negative.

The tax exclusion…fuels the rapid growth of health spending, contributes to stagnating wage growth, and disadvantages low-wage workers. Because there is no limit on how much can be excluded from taxes, workers are encouraged to buy more expensive coverage than they would otherwise…makes consumers less sensitive to prices and promotes the use of medical services, including services that may not provide much value to the patient.

Let’s take a closer look at some of the problems associated with the exclusion.

The exclusion has caused a shift in compensation from taxable cash wages to greater health benefits which are not taxed. Between 1999 and 2015, the average employer contribution for family coverage nearly tripled while wage rates increased by only about half.

By the way, our leftists friends should oppose the exclusion for class-warfare reasons.

…workers in higher tax brackets benefit the most from the exclusion. The Joint Committee on Taxation found that the average savings for tax filers with incomes less than $30,000 was about $1,650 compared to about $4,580 for those with incomes over $200,000.

To deal with these negative effects, Antos proposes a modified version of the “Cadillac tax” from Obamacare combined with tax credits for consumers who purchase their own health insurance.

That’s better than the status quo, but the ideal solution is a flat tax, which would eliminate the deduction provided to employers for compensation in the form of fringe benefits.

In their book on tax reform, Professors Hall and Rabushka explain the obvious beneficial consequence of a level playing field for all forms of compensation.

The flat tax eliminates the distortion toward fringe benefits created by the fact that employers can deduct them, thereby receiving a subsidy that can be passed on to their employees. The best alternative, and one we expect your employer to select, is to offer you higher pay in exchange for lower fringes. You can then use the extra cash to buy whatever combination of benefits you desire.

This will make the healthcare marketplace much more efficient.

Here’s what I wrote about the healthcare exclusion way back in 2009, as part of a column on government-created inefficiency in the health sector.

…social engineering in the tax code created this mess. Specifically, most of us get some of our compensation in the form of health insurance policies from our employers. And because that type of income is exempt from taxation, this encourages so-called Cadillac health plans.  …our gold-plated health plans now mean we use insurance for routine medical costs. This means, of course, we have the paperwork issues discussed above, but that’s just a small part of the problem. Even more problematic, our pre-paid health care system is somewhat akin to going to an all-you-can-eat restaurant. We have an incentive to over-consume since we’ve already paid. Except this analogy is insufficient. When we go to all-you-can-eat restaurants, at least we know we’re paying a certain amount of money for an unlimited amount of food. Many Americans, by contrast, have no idea how much of their compensation is being diverted to purchase health plans. …this messed-up approach causes inefficiency and higher costs. We consumers don’t feel any need to be careful shoppers since we perceive that our health care is being paid by someone else. Should we be surprised, then, that normal market forces don’t seem to be working? (though it is worth noting that costs keep falling and quality keeps rising in the few areas – such as laser-eye surgery and cosmetic surgery – that are not covered by insurance) Imagine if auto insurance worked this way? Or homeowner’s insurance? Would it make sense to file insurance forms to get an oil change? Or to buy a new couch? That sounds crazy. The system would be needlessly bureaucratic, and costs would rise because we would act like we were spending other people’s money.  But that’s what would probably happen if government intervened in the same way it does in the health-care sector.

By the way, to make sure politicians don’t get a windfall of new revenue, the healthcare exclusion should only be repealed as part of a reform that also lowers tax rates.

Here’s a video from the Center for Freedom and Prosperity that highlights how the healthcare exclusion is a major cause of the third-party payer problem.

And if you like videos, I strongly recommend this Reason TV explanation of how simple and affordable healthcare can be in the absence of government-created third-party payer.

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The ongoing cluster-you-know-what of Obamacare is a source of unhappy satisfaction.

Part of me is glad the law is such a failure, but it’s tragic that millions of people are suffering adverse consequences. These are folks who did nothing wrong, but now are paying more, losing employment, suffering income losses, and/or being forced to find new plans and new doctors.

And it seems we get more bad news every day, as noted in a new editorial from Investor’s Business Daily.

ObamaCare rates will skyrocket next year, according to its former chief. Enrollment is tumbling this year. And a big insurer is quitting most exchanges. That’s what we learned in just the past few days.

Why do we know these three bad things are happening? Because that’s what we’re being told by Mary Tavenner, the former head of the Center for Medicare and Medicaid Services for the Obama Administration who has now cashed out and is pimping for the health insurance companies that got in bed with the White House to foist Obamacare on the American people.

IBD gives us the sordid details.

Why will 2017 rates spike even higher? In addition to the cost of complying with ObamaCare’s insurance regulations and mandates, there’s the fact that the ObamaCare exchanges have failed to attract enough young and healthy people needed to keep premiums down. Plus, two industry bailout programs expire this year, Tavenner notes. Oh, and she admits that people are gaming ObamaCare just like critics said they would: buying coverage after they get sick — since insurance companies can no longer turn them down or charge them more — then dropping it when they’re done with treatments. “That churn increases premiums. So you have to kind of price over that.”

And that’s just one slice of bad news.

Here’s more.

ObamaCare enrollment has already dropped an average of more than 14% in five states since February — a faster rate of decline than last year — as people get kicked off for not paying premiums. Finally, we learned on Tuesday that UnitedHealth Group (UNH) is planning to drop out of almost every ObamaCare market it currently serves after losing $1 billion on those policies. …Skyrocketing premiums, fewer choices in the marketplace, and people fleeing ObamaCare in droves after signing up. This isn’t exactly what Obama promised when he signed ObamaCare into law.

For those who were paying attention, none of this is a surprise. It was always a fantasy to think that more government intervention was going to improve a healthcare system that already was cumbersome and expensive because of previous government interventions.

By the way, IBD isn’t the only outlet to notice the ongoing disaster of Obamacare.

Let’s look at some other recent revelations.

Chris Jacobs writes that “For millions of Americans, the Left’s insurance utopia has rapidly deteriorated into a bleak dystopia” and that “the ‘cheaper prices’ that the president promised evaporated as quickly as the morning dew.”

John Graham explains that “CBO estimates Obamacare will leave 27 million uninsured through 2019 – an increase of almost one quarter” and that “CBO estimates 68 million will be dependent on the program this year through 2019 – an increase of almost one third in the welfare caseload.”

Betsy McCaughey opines that, “Obamacare is already hugely in the red. …over the next ten years Obamacare will add $1.4 trillion to the nation’s debt” and that “Insurers struggling with Obamacare are already drastically reducing your choice of doctors and hospitals to cut costs.”

Devon Herrick reveals that “Obamacare has caused more people to reach for their wallets after a medical encounter — not less” and that “all but the most heavily subsidized Obamacare enrollees would be better off financially if they skipped coverage and pay for their own medical care out of pocket.”

Jeffrey Anderson observes that “it seems possible that Obamacare has actually reduced the number of people with private health insurance” and that “Obamacare is basically an expensive Medicaid expansion coupled with 2,400 pages of liberty-sapping mandates.”

John Goodman notes that “Prior to Obamacare, many employers of low-wage workers offered their employees a “mini med” plan, covering, say, the first $25,000 of expenses” and that “Those plans are now gone… employees…are…completely uninsured”

The CEO of CKE Restaurants warns that “fewer people buying insurance through the exchanges, the economics aren’t holding up” and that “Ten of the 23 innovative health-insurance plans known as co-ops—established with $2.4 billion in ObamaCare loans—will be out of business by the end of 2015 because of weak balance sheets.”

Critics of Obamacare now get to say “we told you so.”

As the Washington Examiner opines:

…conservatives screamed a simple fact from the rooftops: Obamacare will not work. No one wanted to listen then, but their warnings are now coming into fruition. Obamacare, as constructed, attempted to fix a dysfunctional health care payment system by creating an even more complicated system on top of it, filled with subsidies, coverage mandates, and other artificial government incentives. But its result has been a system that plucked Americans out of coverage they like and forced them to pay more for less. …Taxpayers and insurance customers alike should demand replacing Obamacare with a system that reduces costs and improves quality by injecting actual choice and competition into the insurance market.

I especially like the last part of the excerpt. Which is why we need to go well beyond simply repealing Obamacare if we want to restore market forces to the healthcare sector.

P.S. I wrote about that it’s tragic that so many people are suffering because of Obamacare. I should add that there are some victims who actually are getting what they deserve.

P.P.S. In the long run, I fear taxpayers will be the biggest (and most undeserving) victims.

P.P.P.S.Though, in fairness, the law does have at least one redeeming feature.

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My colleague Michael Cannon has been a tireless advocated for market-based health reform. His research has helped pave the way for good Medicare and Medicaid reform proposals on Capitol Hill and he is justifiably famous for his dogged opposition to Obamacare.

With that glowing introduction, you may be surprised to learn that Michael has stirred up a hornet’s nest among conservatives by asserting that Marco Rubio’s healthcare reform legislation contains an Obama-like mandate.

…where is conservative outrage over Marco Rubio’s health plan, which actually contains an individual mandate? …The centerpiece of Rubio’s proposal… If you purchase a government-approved health plan, you could save, for example, $2,000 on your taxes. If you don’t, you pay that $2,000 to the government. That is exactly how Obamacare’s individual mandate works.

As you might expect, this rubs a lot of people the wrong way.

Writing for Forbes, Ryan Ellis argues that tax preferences aren’t mandates.

By this twisted, Orwellian logic, there is a government mandate to have kids (child tax credit), buy a house (mortgage interest deduction) and save for retirement (401(k) plans).

James Capretta is similarly critical in his column for National Review.

Cannon’s logic is absurd. Senator Rubio…wants to make sure that all Americans get a comparable tax break for health insurance, regardless of whether or not they get their insurance through their place of work. …No one would be required to do anything.

Grace-Marie Turner, in her column for Forbes, echoes those statements.

The Rubio plan does not and would not involve a mandate, and there are no enforcement penalties for not taking the credit. …Claiming that the Rubio plan is at least as bad as Obamacare is an irresponsible position.

Wow, Michael is apparently twisted, absurd and irresponsible. And these are statements from his friends and allies! When I get slammed, by contrast, it’s by leftists.

So what gives? At the risk of sounding like a mealy-mouthed politician, I’m going to argue that both Michael and his critics are right and that this fight is not really about a “mandate” but instead is a battle over whether (and how) government should use fiscal policy to induce certain healthcare decisions.

First, let me explain why Michael is right. His core argument, as captured by this excerpt from his article, is very straightforward.

Rubio’s tax credit would…give the federal government as much power to force you to purchase unwanted coverage as Obamacare does.

And he’s basically right. Under Obamacare, you can choose to buy a health insurance policy in order to pay less to the IRS. Under Rubio’s plan, you can choose to buy a health insurance policy in order to pay less to the IRS.

To be sure, the mechanisms are different. Under Obamacare, you pay less to the IRS because you’re not being fined. Under Rubio’s plan, you pay less to the IRS because you’re taking advantage of a tax credit. But the net result is still somewhat similar, at least from an economic perspective.

Now here’s why Michael’s critics are right. Notwithstanding a degree of economic equivalence, most people do not think a penalty and a bribe are the same.

The average person probably won’t get offended if you tell them they can have $1,000 if they touch a hot stove. They may say yes or they may say no, and they may think you’re weird for making the offer, but there presumably won’t be hard feelings.

On the other hand, if you tell the average person that you will coercively deprive them of $1,000 if they don’t touch a hot stove, they will probably be upset that you’re putting them in an unpleasant position. And regardless of what they choose, they’ll resent you.

This helps to explain why many people don’t like Obamacare. It forces them to choose between two things they may not want.

But in Rubio’s plan, the choice is whether you should choose something in order to get something. That’s a more pleasing scenario.

Now let’s shift to the real issue, which is the degree to which fiscal policy should be used to encourage health insurance.

Michael is an advocate of large health savings accounts and most everyone else prefers tax credits (and they prefer refundable credits, akin to the EITC, which means Uncle Sam would give money to people who don’t earn enough to pay tax).

Digging into that issue is not the goal of today’s column. Suffice to say that if your long-run goal is to get government out of the health sector, you’ll probably be more sympathetic to Michael’s view. If you think getting government out of the health sector is a pipe dream, you’ll probably be more sympathetic to tax credits.

The bottom line is that this isn’t a fight between good guys and bad guys. It’s a tactical disagreement among people who realize that government intervention has screwed up our healthcare system and don’t fully agree on how to get the toothpaste back in the tube.

P.S. Shifting to a different topic, it’s time to savor a rare victory. Regular readers may recall the postscript in a column last year about the IRS stealing the bank account of a guy who runs a convenience store in North Carolina. That was horrible and disgusting (and there are many other examples of similar misbehavior by the feds). But the good news is that the bureaucrats have been forced to return the money.

But remember that this is just a victory in one battle. We won’t win the war until the disgusting practice of civil asset forfeiture is abolished.

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I wrote last June about an unfortunate British guy who, after his leg was broken by thieves, was told by the government that his injury wasn’t serious enough for an ambulance.

The poor chap eventually was driven home by some cops and then had to take an Uber to the hospital.

While writing about this story, I semi-joked about what would be required to get an ambulance.

If you’re about to die, they’ll send an ambulance. But not for anything less than that.

Little did I realize that the bureaucrats would prove me wrong.

Here are some amazing excerpts from a story in the U.K.-based Telegraph.

A dying pensioner wrote a heartbreaking ‘I love you note’ to his daughters while he waited two hours for an ambulance to respond to his call for help following a heart attack. …The retired mechanical fitter… pulled a cord in his flat in Prenton in Birkenhead, Merseyside, to sound an alarm in a 24/7 emergency call centre and could be heard by the call handler shouting: “Help”. …The call handler dialled 999 but Mr Volante’s case was given a low priority by the ambulance service and paramedics took 1hr 40mins to arrive. They found him dead on his living room floor.

ronald-volante-1_3563047bIn a touching but tragic gesture, the deceased spent some of his wait time writing a note to his daughters.

A heartbreaking note was found in Mr Volante’s flat after his death, which read: “I love you Rita, I love you Deb, Dad.” This was a reference to his two daughters, Debbie Moore and Rita Cuthell.

I suppose, to be fair, that we can’t fully blame Mr. Volante’s death on government incompetence. He may have died even if the ambulance arrived in a timely fashion.

But imagine what it would be like to place a very serious call and to be treated like an afterthought.

Though the government at least offered an insincere apology, so I guess that counts for…um, nothing.

…a North West Ambulance Service spokesperson said: “The Trust would like to express its sincere condolences to Mr Volante’s family during this difficult time.

But let’s look at the bright side. If the ambulance had been on time and Mr. Volante had been admitted to the hospital, the government may have starved him to death instead.

I’m guessing a heart attack – even one where it takes you 90 minutes to die – would be preferable.

Particularly since you can’t be sure whether government-run healthcare will kill you accidentally or kill you deliberately.

P.S. Here’s my collection of horror stories about the U.K.’s version of Obamacare: hereherehereherehereherehereherehere, herehereherehereherehere and here. By the way, Paul Krugman tells us that all these stories are false. So who are you going to believe, him or your lying eyes?

P.P.S. To be fair, some screw-ups are inevitable, even in a perfectly designed healthcare system. But I would argue that horror stories are more common when the profit motive is weakened or eliminated. If you’re a Brit and you die or suffer because of crappy government-run healthcare, there’s no feedback mechanism to punish the doctor and/or hospital (or, in the above case, ambulance service). Their budgets already are pre-determined. Likewise, if you’re an American and you die or suffer because of sub-standard Medicare or Medicaid treatment, there’s presumably no effective feedback budgetary mechanism.

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Even before it was enacted, it was obvious that Obamacare was going to have a negative economic impact.

From a fiscal policy perspective, the law was bad news because all the new spending and higher taxes increased the fiscal burden of government.

From a regulatory intervention perspective, the law was bad news because it exacerbated the third-party payer problem.

Form a jobs perspective, the law was bad news because it increased the attractiveness of government dependency compared to employment.

But those were just the slap-you-in-the-face impossible-to-overlook problems.

As Nancy Pelosi infamously noted, the law needed to pass so we could know what was in it.

And the more we learn about the contents, the more evidence we find that (as shown in this poster) that more government is never the answer.

A new empirical study by scholars at Harvard and Stanford finds that “free” goodies from the government actually have a hefty price tag.

The dependent care mandate…one of the most popular provisions of the 2010 Affordable Care Act…requires that employer-based insurance plans cover health care expenditures for workers with children 26 years old or younger. …there has been little scholarly work measuring the costs and incidence of this mandate and who pays the costs of it. In our empirical work, ….we find that workers at firms with employer-based coverage – whether or not they have dependent children – experience an annual reduction in wages of approximately $1,200. Our results imply that the marginal costs of mandated employer-based coverage expansions are not entirely borne only by the people whose coverage is expanded by the mandate.

Wow, this is worse than I thought. I assumed the pejoratively nicknamed “slacker mandate” wasn’t a big issue because the types of kids getting coverage (ages 19-26) presumably had very low health expenses.

But if average wages at affected firms are $1200 lower than they otherwise would be, that’s a big hit. Maybe Pajama Boys have physical health problems in addition to their mental health problems.

Now let’s look at another higher-than-expected cost, except this time the victims are taxpayers and other health care consumers rather than workers.

Politico has a depressing story of how people have figured out how to game the system

Obamacare customers are gaming the system, buying coverage only after they find out they’re ill and need expensive care… No one knows precisely how many might be manipulating the system, but the plans say they run up much higher medical bills and then jump ship, contributing to double-digit rate increases and financial losses. Health plans also complain some customers are exploiting a three-month “grace period” — when they can keep getting subsidized coverage even if they’ve stopped paying their share of premiums.

In other words, Obamacare is so poorly designed – thanks to subsidies, mandates, and other forms of intervention – that many people can basically wait until they’re sick before signing up.

Then they incur expenses that are covered by taxpayers and/or passed on to other healthcare consumers.

There’s also another group of victims, though I confess that part of me thinks that the insurance companies deserve to suffer since they (like Big Pharma) endorsed Obamacare.

…those trends make the risk pools skew toward sicker, costlier customers — and under Obamacare, plans can no longer deny coverage to those with expensive medical conditions. That problem has been exacerbated by the large numbers of healthier people who are choosing to stay uninsured rather than shell out money for coverage.

Yup, I experience a warm glow of schadenfreude after reading that passage. But I also know that it won’t be good for the American economy and the American people if the market for private health insurance entered an Obamacare-driven death spiral.

That being said, I also don’t want them to get any bailout cash.

In any event, if the health insurance companies have a meltdown, you could bet your last dollar that the crowd in Washington somehow will blame capitalism and say that the solution is single-payer health care (even though that system is so dysfunctional it was repealed by Bernie Sanders’ Vermont and even though that system leads to endless horrors in the United Kingdom).

P.S. In the interest of fairness, I will admit that there is a group that has benefited from Obamacare.

P.P.S. Actually, there’s another group, so we can say there are two winners from government-run healthcare.

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In 2009, Paul Krugman assured his readers that government-run healthcare was a good idea, writing that “In Britain, the government itself runs the hospitals and employs the doctors. We’ve all heard scare stories about how that works in practice; these stories are false.”

I guess one could argue that the determination of “scare stories,” like beauty, is in the eye of the beholder.

But if I was writhing in agony on a street because of a broken leg, I wouldn’t be happy with a healthcare system that told me I didn’t need an ambulance.

And if I was part of a system that rewarded hospitals for letting old people die, I might be tempted to say that was a scary system.

Moreover, I would be understandably irked if my I was stuck with a system for healthcare that treated patients with callous disregard.

But if you’re wealthy and well-connected, then perhaps you don’t think these results are scary because you know you’ll always be able to jump the queue in a government-run system and get good treatment for yourself.

In any event, it’s not just the healthcare system that’s scary on the other side of the Atlantic.

A report in the Telegraph paints a grim picture of dental care in the United Kingdom

Dental health standards are falling to “Third World” levels in parts of England because of a crisis of access to NHS treatment, more than 400 dentists claim today.In a letter to The Telegraph, a coalition of professionals from across the country argues that the system is “unfit for purpose” with millions of people seemingly going for long periods without even seeing a dentist, or ignorant of basic dental hygiene.The signatories accuse successive governments of hiding the problem behind a veil of spin and denial. They point to official figures showing large numbers of primary school children having to be admitted to hospital to be treated for serious tooth decay and other dental problems, many of which, they say, could be easily prevented.

As you might expect, the bureaucracy claims everything is just fine.

NHS England denied that there is a crisis…a spokeswoman for NHS England insisted: “These claims are wrong – more patients are getting the dental care they need, and 93 per cent of people got an NHS dental appointment when they wanted one in the last 24 months.”

But the numbers tell a different story.

NHS figures show that almost half the adult population of England (48 per cent) and a third (31 per cent) of children have not seen a dentist within two years. Crucially almost 62,500 people are admitted to hospital in England per year because of tooth decay – three quarters of them, or 46,400, children. …“The NHS dental system in England is unfit for purpose,” the dentists wrote. “Far from improving, the situation has worsened to such an extent that charity groups normally associated with providing dental care in Third World arenas now have to do so in England.

None of this sounds very good, though let’s acknowledge that the dentists in the U.K. are an interest group that presumably wants to get a bigger slice of government money.

So they presumably would have an incentive to exaggerate the downside of British dental care.

But this underscores the problem with government takeover of a sector. Instead of a system of voluntary and beneficial exchange, you suddenly have a zero-sum, third-party-payer-driven system where consumers, providers, and taxpayers suddenly have an incentive to squabble.

P.S. For other U.K. “scare stories,” see herehereherehereherehere, here,hereherehere, here, hereherehere, herehere, here and here.

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