SCHIP Travesty Will Prevail if Bush Doesn't Veto...

The SCHIP debacle continues in Washington. There have been too many gullible Republicans who went along with this who apparently were frightened to death of the “sound bite” about them hating children.

Children would now be defined as people under age 25. That would happen in all states, and we know that many would continue the perversion of including adults as well. Remember that Wisconsin now spends 75% of its funding on adults, not children!

The income level provisions of this travesty have been increased to 400% of the federal poverty level, up from 200%. That is more than $80,000 for a family of four! Imagine just how many employers will appear on the next BadgerCare “embarrassment list” with that income benchmark in place.

SCHIP would become a permanent entitlement program whereas it has been forced through periodic re-authorization up until now. Imagine how this entitlement will spin out-of-control if the President would sign the bill.

Funding comes from a diverse group:

We all understand that the tax on tobacco products will increase in order to pay for this largesse. That goose will die off quickly enough, so many other sources will ultimately be tapped.

We didn’t know, however, that private insurance policies would be taxed as well. This “fair share” tax would begin at $375 million in year one, but we all know that number will pale in comparison to what we’ll see in five years and beyond. This on top of the "crowding out" of private insurance plans every time a person elects to be part of their state's SCHIP. Seems that "big insurance" was squarely in the cross hairs as the Democrats sought to incrementally increase the numbers of people on "government run health programs".

And, Congress "bravely" takes on the senior lobby by taking money away from the successful Medicare Advantage program that is now used by some 8 million seniors in lieu of regular Medicare plans. The CBO analysis indicates that as many as 3 million of the current users will be forced out of the programs by the funding reductions. These programs were, of course, made possible by insurers coming to the table as the original program intended to secure better levels of coverage and coverage in outlying areas. "Big insurance" was again in the cross hairs without regard to the seniors who were enrolled in this better deal.

The private sector is about to take a big hit from the liberals.

It is imperative that we let President Bush know we want him to hold his position and veto this abomination when it finds its way to his desk. It appears that his veto has a good chance of standing given that the House passed its version by just 225 to 204. Many congressional representatives would have to reverse their positions in order to sustain a veto.

In the meantime, each of us must contact our elected representatives who voted for this travesty to advise that we are disgusted with their work product and to assure them that we’ll remember through multiple election cycles. And, we need to talk with those who voted the right way so they aren't frightened into changing their vote if the President vetoes the bill.

Health Care Reform or Insurance Reform - The Political Reality

A guest Blog posted on behalf of Terry Murphy:



Democrats in the Senate just recently announced their health care reform plan known as Healthy Wisconsin. In fact, just one day after providing the details of the plan, they put their idea into their version of the State Budget and passed the plan out of the Senate. Their reform plan is theoretically one step away from being sent to the Governor’s desk to be signed into law. This is the most sweeping and expensive legislation in our state’s history and the vast majority of Wisconsin citizens have no idea the plan even exists, let alone what the plan will do to them. How could this possibly happen? Well, that’s a discussion for another day. Instead, the question we ask today is why are all of the government reform plans reforming insurance rather than reforming health care?

Both the Centers for Medicaid and Medicare Services (CMS) and a study found in the New England Journal of Medicine show that just 12 cents out of every insurance dollar goes to the cost of insurance administration, leaving the vast majority of the insurance dollar (88 cents) going to the cost of health care. While we recognize health care costs include some administrative costs of their own, the fact remains that the vast majority of insurance premiums collected are spent on health care, not the cost of financing such care through insurance. Knowing this fact, why would anyone devote all of their time and effort in trying to reform how we finance our health care (through insurance), rather than trying to reform actual health care costs? Healthy Wisconsin, like nearly all of the other reform plans introduced in the last year, focuses on how we finance health care by replacing our current insurance system with a government run taxing system. Even if their taxing approach actually reduced some of the insurance administrative costs (the 12 cents), because their plan doesn’t address the cost of health care (the 88 cents), health care will still be unaffordable, making either the insurance or the taxes to pay for such care unaffordable.

Senate Democrats estimate an initial payroll tax of 16% in order to pay for their program. First, this estimate makes a bold assumption that all health care providers (doctors, hospitals, nursing homes, etc) will voluntarily reduce their costs by about 40%. Does anybody in Wisconsin believe this assumption is realistic? Therefore, like the Massachusetts reform plan, the 16% payroll tax estimate will likely be much higher. Secondly, since 2000, health care inflation averaged 12% per year, compared to increases in US Household Income at 3.7%. A provision of Healthy Wisconsin states that health care increases in Wisconsin should not exceed the national average. This means that if health care inflation remains at 12%, payroll taxes for Healthy Wisconsin are guaranteed to increase each year, far outpacing what Wisconsin residents can afford. By the second year of their plan, payroll taxes would have to increase to nearly 18%, and by the third year, the payroll tax would balloon to over 20%. Exactly how is this plan supposed to help Wisconsin citizens?

The problem with Healthy Wisconsin and all of the other government based reform plans is that none of them set out to reform health care costs. Why? Perhaps the answer is that reforming health care costs is not “politically” attainable. To reform, or control health care costs, government has but two options. The first option would require the government to get control of health care providers by either dictating what they can charge or using the more radical approach and taking over the health care providers like the Canadian system. Regardless of what public opinion says about wanting “universal” health care, politicians know that Wisconsin citizens do not want government involved in their health care. Therefore, this option is not one likely to be found in a health care reform plan. However, if any of the government based reform plans like Healthy Wisconsin ever became law, as health care costs continued to increase, thereby increasing taxes, this would be the only option left for government to control health care costs. A scary thought indeed.

The second option would be for Government to let the market work to control health care costs, through transparency and competition. Unfortunately, for many politicians, this option takes far too long to work, and mistakenly gives the appearance of not doing anything in the eyes of voters. Politicians believe voters are looking for a silver bullet and the fact is there are no silver bullets in health care reform. The other problem with this second option is that it cannot be put into a 30 second sound bite that politicians could campaign on. It is truly sad that we have politicized health care reform, and that the only option that will work is not even being considered by many politicians because it isn’t politically acceptable. This is wrong for Wisconsin and wrong for Wisconsin consumers.

A recent report showed that Wisconsin enjoys some of the highest quality health care in the nation. Most surveys find that the majority of citizens like the health insurance plan they have purchased. Wisconsin citizens are smarter than some politicians give them credit for. The government can play a large role in this second option, by working to help the private market work better in controlling health care costs. The Coalition for Sensible Health Care Solutions has provided a blueprint for health care reform in Wisconsin. It works to address health care costs, and yet still works to improve the efficiency of our insurance industry. It is this second option that should be considered by any legislator who doesn’t care about politics, but instead cares about making health care affordable for his or her constituents.

We have to stop wasting our time, effort and resources with attempts to exclusively reform insurance only because it is politically acceptable. Instead, we have to start trying to reform health care costs and work to improve the efficiency of insurance because it is the right thing to do. Each year, Wisconsin consumers face another double digit increase in health care costs because we have avoided the second option. We cannot afford to wait any longer.

Terry Murphy is the owner of East Towne Insurance Services, Inc. (an employee benefits brokerage firm in Milwaukee). Mr. Murphy is also the Legislative Committee Chairman of the Wisconsin Association of Health Underwriters (WAHU). WAHU is an association of insurance professionals who work directly with consumers in the financing of their health care. WAHU is a chapter of the National Association of Health Underwriters covering the insurance needs of over 100 Million Americans.

Google Could Revolutionize Healthcare...

Google has been thought to be considering working on ways in which people could store their health records on Google and have them readily available for personal needs. It has been quite careful about letting outsiders in on its plans but has just taken action that could suggest this idea is gaining traction.

Google recently appointed its new Health Advisory Council and it is comprised of some 22 very heavy hitters:

Dean Ornish, Founder and President, Preventive Medicine Research Institute

Douglas Bell, Research Scientist, RAND Health, RAND Corporation

Delos M. Cosgrove, CEO, Cleveland Clinic

Molly Coye, CEO, HealthTech

Dan Crippen, Former Congressional Budget Office Director & Reagan White House Asst.

Linda M. Dillman, EVP, Risk Management, Benefits & Sustainability, Wal-Mart

John Halamka, CIO, Beth Israel Deaconess Medical Center & Harvard Medical School

Bernadine Healy, Former NIH Head, Health Editor & Columnist, U.S.News & World Report

Bernie Hengesbaugh, COO, American Medical Association

Douglas E. Henley, EVP, American Academy of Family Physicians

David Kessler, Former FDA Commissioner, Vice Chancellor-Medical Affairs & Dean, School of Medicine, UCSF

John Lumpkin, Sr. VP, Director of Health Care Group, Robert Wood Johnson Foundation

John Rother, Group Exec. Officer of Policy & Strategy, AARP

Anna-Lisa Silvestre, VP, Online Services, Kaiser Foundation Health Plan, Inc.

Greg Simon, President, FasterCures

Mark D. Smith, President & CEO, The California HealthCare Foundation

Paul Tang, Internist & VP, Chief Medical Officer, Palo Alto Medical Foundation & Chairman, Board of Directors, American Medical Informatics Association

Sharon Terry, President & CEO, Genetic Alliance

John Tooker, EVP & CEO, American College of Physicians

Doug Ulman, President, Lance Armstrong Foundation

Robert M. Wachter, Professor of Medicine, UCSF, Assoc. Chairman, UCSF Department of Medicine, Chief – Medical Service, UCSF Medical Center

Matthew Zachary, Founder & Executive Director, The I’m Too Young for This! Cancer Foundation for Young Adults

The private sector is stepping up its game!

Google is among the most innovative organizations in the world and should not be undersold as to the potential for success in this undertaking…if that’s what it is.

Americans Living in Canada Comment on Health Care...

A recent survey of some 310 Americans who have experienced use of health care services in both the U.S. and Canada produced expected results. The full survey results are available here.

The overall result had 74% rating the overall quality of U.S. health care as excellent or good, while 50% of the same group gave Canadian health care a similar rating.

The nod was given to U.S. health care in the areas of accessibility, timeliness, quality, and available technology. Canada scored higher in the areas of personal cost of both health care and pharmaceuticals. Obviously, the government pays the costs of permissible care in Canada, so it was expected that personal financial exposure would be limited.

Wait times in Canada were comparatively quite long with people citing too few specialists and too little government funding.

As government funding was exhausted in Canada, services were rationed by imposition of longer wait times and cancelled surgeries.

This group had experienced U.S. health care within two to five years of the time of the survey and had been covered by Canadian health care since the time of their arrival in that country. The respondents were scattered across the provinces with higher concentrations where the population was greater.

Consumers Demand Transparency...

A recent survey (completed in February 2007) conducted for the PNC Financial Services Group by the Boston-based research firm of Chadwick Martin Bailey found that consumers (especially those with high deductible health plans) want more transparency in health care administration.

The survey was based on telephone calls conducted with 150 executives from U.S. hospitals or health systems, 50 executives from insurance organizations and an online survey of 1,000 U.S. consumers.

Six of ten people who have high deductible health plans strongly agree that their families have become more conscious of health care costs, and some 22% said they compared doctors and hospitals to find the best value for their money.

This finding supports the changing environment that is being brought about by consumer directed health care. As consumers are reintroduced to the process of buying their health care, they are quickly becoming more aware of costs and outcomes. As the consumer directed movement continues to expand, it is becoming clear that the marketplace is responding with pricing transparency, better knowledge of outcomes and generally more informed patients.

Hospitals are working diligently to improve their overall ranking in terms of outcomes. Physician groups are focusing on patient communication. Entrepreneurial companies are developing point-of-sale claims pricing systems to enable patients to learn true costs and to pay for services with debit cards.

Employers are very conscious of wellness programs as a part of the solution to bring health care costs down, thus reducing the cost of insurance benefit plans while gaining a healthier and more productive workforce.

Employers are learning if they don’t already know it, that they must share the premium savings with their employees through funding of Health Savings Accounts and Health Reimbursement Accounts. Those who used the high deductible health plans primarily as vehicles to shift costs are coming to understand that this was a short-sighted approach.

Consumer directed health care is maturing and expanding. That frightens some in government and industry. Some in government don’t relish the idea of empowering the individual since people begin to understand that they don’t need big government to take care of them.

Some in industry and labor circles are similarly wary of these programs. Again, control of members can be threatened when the individuals begin to make their own decisions.

Some in the health care industries are not anxious to see patient independence since they are comfortable with the status quo. However, those same health care providers are being forced to change. They will either adapt to this new era, or risk being relegated to the junk heap as another entity that failed to take the necessary action.

There is a growing tide sweeping over the health care landscape and it is called consumerism.

Canadians don't care for Sicko...

…so read the headline for an article written by Peter Howell for the Toronto Star on May 20, 2007.

He stated that Michael Moore took quite a verbal beating during an interview at the Cannes Film Festival where Moore has been touting his latest “documentary”. I quote from his article:

“We Canucks were taking issue with the large liberties Sicko takes with the facts, with its lavish praise for Canada’s government-funded medicare system compared with America’s for-profit alternative.”

“…Sicko makes it seem as if Canada’s socialized medicine is flawless and that Canadians are satisfied with the status quo.”

“Other Canadian journalists spoke of the long wait times Canadians face for health care, much longer than the few minutes Moore suggests in Sicko.”

“Sicko, to be released in North America on June 29, is by turns enlightening and manipulative, humorous and maudlin. It makes many valid and urgent points about the crisis of U.S. health care, but they are blunted by Moore’s habit of playing fast and loose with the facts. Whether it’s a case of the end justifying the means will ultimately be for individual viewers to decide.”

The U.S. health care industry knows this is coming and feels alternately threatened, angered, frightened and somewhat helpless. What can be done to blunt this latest of Moore’s film adventures?

Those who care must become much more knowledgeable about Canadian, British, French and Cuban health care issues and how those systems compare to that of our country. Moore has changed his original tactics and now attempts to cajole, instead of club, folks to get them to see his point of view.

His tactics require that spokespeople for the industry assure that they too change their tactics. They can no longer simply criticize the messenger; they must become sufficiently knowledgeable as to be able to refute the wild claims one-by-one.

We are disadvantaged by the fact that his public relations machine is running at full speed and has been for awhile. We have yet to see the film in its entirety and do not yet understand the nature of his various claims and/or charges. We must begin to act now in order to counter the various “issues” soon after the initial screenings in this country.

Agents certainly understand many of the faults of the current U.S. health care system. They must not be seen as defensive, however, when it is they who have been preaching to the choir for the past decade or better.

Agents simply need to occupy the high ground of truth and reason. The Coalition for Sensible Health Care Solutions is a solid platform on which to build consensus.

Self-Fullfilling Prophesy?

An Associated Press report titled “Health System Deemed a ‘Mess’” appeared in the Journal-Sentinel in Milwaukee today. It obviously has appeared across the country.

The first two paragraphs read as follow:

“The U.S. health care system is ‘a dysfunctional mess’ and politicians who insist otherwise look ignorant, according to a medical journal essay by a prominent ethicist at the National Institutes of Health.

‘If a politician declares that the United States has the best health care system in the world today, he or she looks clueless rather than patriotic or authoritative,’ Ezekiel Emanuel wrote in today’s Journal of the American Medical Association."

Mr. Emanuel went on to decry our health care results, to express dismay at what is spent per person in the U.S., to advise that our average life expectancy ranks 45th in the world behind both Bosnia and Jordan. He also noted, for good measure apparently, that the U.S. infant death rate is 6.37 per 1,000 live births, higher than that of most developed nations.

First, the AMA was in the company of the AARP and Families USA when, on January 18, 2007 they issued a joint press release announcing the “unprecedented alliance” of themselves and some 13 other organizations which had come together to solve the health care crisis.

A careful reading of that unprecedented agreement suggests that some of what had been more reasonable organizations rolled over and became part of the liberal solution. The solution used several federal programs to expand coverage, increased participation of the uninsured, encouraged state experimentation, etc., etc. There is nothing wrong with any of that, except it is apparent to me that the “solutions” lay on the left side of center. Isn’t that always the case when the left-leaning organizations announce some great new coalition?

Next, Emanuel plays loose with his numbers by not taking into account the variations that exist. We spend more per person and we get more. Countries that spend less ration care to their citizens. Our birth rate adjusted to the manner of accounting employed in other countries would show better survival than the rest since we permit low weight, premature and disadvantaged babies to be born into the world, and then we fight to keep them alive. By the way, we count every live birth. We do not extract from the total those that are unlikely to survive for the first year as is common in many other higher ranking countries.

Is the Journal of the AMA publishing this misinformation simply to try to justify its own beliefs, or did it simply take for granted the veracity of the author? I’ll bet that it didn’t simply print without an editorial vetting.

Common Sense in Health Care Debate...at least do no harm!

As the debate over health care and the changes needing to be enacted in Wisconsin continues, we need to be ever mindful that wise people in other states have already made their share of mistakes.

Maine thought that "Dirigo" would cover 130,000 citizens in the first year. That was nearly three years ago. There are some 18,000 citizens covered. Dirigo was to be the vehicle that assured universal coverage.

Connecticut's governor proposed a magic cure-all program. The program wasn't proposed with any cost numbers, but those were developed later. It seems that the Connecticut program might accomplish its goal...but the cost would be triple that of Connecticut's state budget annually.

Illinois's governor has proposed a plan. It threatens to tax employers out of business. Even the Reverend Jesse Jackson has seen the light and stated that health care coverage at the cost of employment is not at all a good trade for the citizens of Illinois.

All this reminds me of what I'd always thought was a part of the physician's oath. There is an erroneous attribution to Hippocrates having to do with the phrase, "first, do no harm." He did author a similar plea, but did so in his Epidemics, Bk. I, Sect. XI. One translation reads: "Declare the past, diagnose the present, foretell the future; practice these acts. As to diseases, make a habit of two things — to help, or at least to do no harm." (Emphasis added)

It is imperative that we do no harm as we settle on the set of initiatives required to set our Wisconsin health care community on the right path for the future as we see that today. Let us incorporate the wisdom of Hippocrates in the process.

Mandated Health Care

Wisconsin has added certain required coverage for health insurance policies over the course of many years. There are more than twenty such requirements or “mandates” as they’re known in Wisconsin. There are even more such mandates across all fifty states.

Mandates have the effect of adding to the overall cost of health care. In some cases this happens because such services were not covered earlier or only partially covered. Mandates can and do make access to such care easier without significant personal cost. Health care costs drive health insurance costs, not the other way around as much of our media would have us believe. Mandates increase our health care costs. And that adds to our crisis in health care.

Mandates viewed individually appear to be good things. The following list shows those that are required in Wisconsin (Fact Sheet on Mandated Benefits in Health Insurance Policies, Office of the Commissioner of Insurance, PI-019 [R 01/2007]):

Optometric Service Access, Chiropractic Service Access,
Nurse Practitioner Access, Dental Service Access,
Adopted Child Coverage, Handicapped Child Coverage,
Home Health Care Access, Skilled Nursing Care,
Kidney Disease Coverage, Mammography Examinations,
Newborn Infant Coverage, Grandchild Coverage,
Diabetes Equipment & Supplies, Genetic Testing Restrictions,
HIV Treatment Drug Access Lead Screening (for children under 6),
TMJ Disorders, Breast Reconstruction,
Child Immunizations, Certain Clinical Cancer Trial Costs,
Maternity Coverage (if provided for any insured, it must be available to all),
Nervous and Mental Disorders, Alcoholism, and other Drug Abuse,
Hospital/Ambulatory Surgery Charges & Anesthetics for Certain Dental Care

(Self-funded [ERISA] plans by a city, village, county, or school district plans may be included in these regulations.)

Reviewing these individual mandates, we begin to get a better idea of how they might increase costs. Chiropractic-type services, for example, were covered originally only if delivered by a medical doctor. If we wanted to see a chiropractor, we did and we paid for it from our pockets. Chiropractors lobbied to gain the right to engage in the delivery of these services through health insurance policies and ultimately won that right. Unit costs were reduced somewhat with the new competition, but increased access to these services, coupled with advertising by the newly approved providers, likely more than offset whatever unit cost savings resulted.

The federal law that enabled health maintenance organizations also added the requirements for some of the now-mandated items in the interests of promoting preventative care (such as vision examinations). Labor-management bargaining contributed to the addition of benefits over the years and that led to certain of the mandates. Insurers were complicit since they added more such benefits in the attempt to differentiate themselves. Health care provider-to-consumer advertising also had a significant impact on health care mandates and increased costs.

Some states have begun to permit health policies referred to as “mandate-light” policies to be sold within their borders. These policies contain fewer mandates, or completely eliminate mandates, thus reducing the cost of those policies, and thereby making health insurance more affordable. The total cost for mandates in Wisconsin is estimated at from 20% of premiums to as much as 32% of premiums.

A valid question is: Should Wisconsin permit mandate-light policies to be sold? If that answer is yes, then the question becomes, which mandates should be excluded? The job of deciding which are in and which are out would be difficult. [Almost as difficult as a government run program deciding what to cover and what not to cover.] Self-insured plans in the private sector could provide some benchmarks for what is provided to employees by a majority of the self insured companies.

If mandate-light plans were permitted, would insurers still be willing and able to offer full mandate policies? Would they be able to price those to anticipate the increased costs of claims being spread across a smaller segment of society [adverse selection]? Would the state promulgate new laws requiring both types of policies? If both types were required, the premium cost would almost certainly be higher in the full mandate policies since only those using the services would be likely to enroll in these plans.

Would this adversely affect many patients or few patients? Is the primary impact more likely to be limited to the provider groups due to decreased volume? Would decreased volume lead to higher unit costs by those same providers? Would the elimination of mandates spawn new policies from some of the more specialized insurers (a talking duck comes to mind)?

As with all questions relating to health care, these are difficult to answer. The free market has historically responded to these needs. Critical illness policies, which have been available for years, were introduced before such coverage was popular in the mainstream, and continue to be purchased by those who believe them to be of benefit.

It has been established that fewer small employers believe they can afford to provide health insurance benefits for their employees each year. The latest reports indicate that something in the range of 60% to 62% of small employers now provide access to health insurance benefits.

Would mandate-light health insurance be better than nothing? Would mandate-light be better than a single payer system operated by a government agency or quasi-public entity? Would mandate-light actually be a step toward relying upon insurance for what it was originally intended…catastrophic unforeseeable health care needs?

We have come to expect fully prepaid health care with but small office visit co-pays, at best. Our “entitlement mentality” has caught up with us and we’re all guilty of permitting that to occur. It has also caught up with our employers and with our country. We are only a few years away from the day when health care costs will consume 20% of our gross domestic product.

We need candid, honest debate and we need it now. That will be difficult in the highly charged environment of today, but it is essential. Can we indeed find our way “back to the future” or are we destined to repeat the failures of so many of our world neighbors?

Health Care & Unintended Consequences...or, How We Got Where We Are

Back in the 1970s, our elected officials enacted new legislation to permit an entity called a Health Maintenance Organization to be organized under federal regulations. That same law provided for grants to be used to create these new entities. People streamed to the federal trough and hundreds of health maintenance Organizations were created.

The intended results were the broadening of health care available to the members of these new organizations. The law required the use of a tool called community rating. This tool was intended to make premium rates fair across the total spectrum: young and old, male and female, and healthy and ill.

In addition, the entities could now either employ the health care providers directly, or those health care providers could organize for purposes of negotiating master agreements under which they'd provide required services for advanced payments. This was thought to be a good way to control the use of limited health care services while helping the new organizations remain financially stable.

It was believed that keeping people healthy was better and less expensive than the treatment of acute issues that had lain untreated for a period of time.

There seemed nothing wrong with the hypothesis, however time began to show the deficiencies.

Community rating caused the rates of the healthy and younger to rise since they had to offset the added costs of the ill and older members. The prepayments to the Health Maintenance Organizations were subject to shortfalls if over utilization occurred. We had just created an official way to ration health care. Services were delayed until the next month, and that solved the over utilization problem for the moment.

To this point, the free market had taken care of this issue; if you didn't have the money to pay for the service, you waited until you had the money.

This method of compensating providers came to be known as prepaid health care and began the process of removing the health care consumer from the equation. We consumers began to observe that our only out-of-pocket cost for this new kind of plan was our co-payment. Back then, co-payments were in the range of $5 to $10 per visit. We began to lose track of the real total cost of the health care we consumed. If we had a sniffle, why not see the doctor; after all, it only cost $5 or $10. We gave no real thought to where the rest of money was coming from, because it didn't appear to come from our pockets. That wasn't and isn't true, but it seems so on the surface.

It is important to understand that the Health Maintenance Organizations were not villains; they were simply following the federal edict. HMOs as we began to call them managed to eliminate much of the waste that had existed. They negotiated tough reimbursement agreements with hospitals. Hospitals that had had occupancy rates of 50% to 60% were now forced to close off wings, or to be creative and find other uses for the empty facilities. One of those uses was the birthing center with soft lighting, etc. Even though the mother was only given 48 hours in the hospital, they were going to be softly lit hours!

As HMOs took ever larger share of the market from traditional insurers, the insurance companies reacted and created their own provider networks and negotiated discounted prices from the usual fee for service pricing. As doctors were forced to take less money for each procedure, they could only exist by performing more procedures.

This story could go on for many more paragraphs. Suffice to say, there were many unintended consequences that continue to cause problems to this day:

• consumers have no concept of the real cost of the services they consume
• health care providers continue to provide more services since that is how they get paid
• health care costs spiral upward at multiples of the cost of other goods and services
• small employers have gotten to the point of ending health care plans to avoid going out of business
• health care now consumes nearly 16% of every dollar generated by our national economy and is headed up

We must restore the consumer to his and her rightful place in the equation. One of the ways to do that is to cause the consumer to want to know the real costs, and to think seriously about seeing the doctor before deciding to do so on a whim. We cause that by having the consumer again be responsible for a larger part of what he or she consumes.

In order for this to happen, we must have truly transparent cost information available. We must have truly transparent quality information available. And, we must have truly transparent outcomes information available. These are roles in which government can legitimately play a part.

We must reward health care providers for being good at what they do. Providers with better outcomes and better pricing should be rewarded with more business. Those not measuring up to their peers should pay the price of full disclosure causing them to clean up their acts. These are roles in which government can legitimately play a part.

Government does not belong in the health care business. There are numerous examples all across the world that vividly point this out. The governments with single payer plans are in trouble. They are running out of money, have alienated their customers [who are also the taxpayers that refuse to pay any more for inferior services], and look longingly to the United States and what they see as the best health care system in the world.

It seems that we're the only people who don't recognize what we have and how we can make it even better.

State Children's Health Insurance Programs: Follow Up

The earlier Blog covering this subject discussed the incremental approach to government run health care and cited the use of the Children's program to cover adults.

Sen. Olympia Snow of Maine (supposedly a Republican but actually a RINO) introduced legislation Thursday to double the funding of this program over the next five years. This flies in the face of the real Republicans who wanted the funding levels reduced to end the improper use of the program using the purse strings.

She was joined in sponsoring this legislation by Sens. Jay Rockefeller (D-W.Va.) and Teddy Kennedy (D-Mass.)

While they were at it, they seized on this opportunity to also increase the coverage afforded under the SCHIP program to include mental and dental health care. This is such a good example of incrementalism, I couldn't help but post an update.

Health Care & Special Interest Groups

We often hear about “special interest groups” trying to influence decisions especially during the debate on the health care “crisis”. Special interest groups have gotten the reputation of being somehow improper or part of something almost subversive in nature. Somehow many of us have been conditioned to shudder whenever we hear the term “special interest group”.

There are some special interest groups with which I take exception and there are other special interest groups with whose positions I concur. I am an intentional member of some of these groups. I am also a member of other special interest groups without even being aware of the fact.

Let’s take a look at some of these special interest groups. The list is almost endless, but here are a few examples. If you are a union member, you are part of one or more special interest groups. If you are a member of a local organization such as a Chamber of Commerce, you are a member of one or more special interest groups. Nurses, insurance agents, church members, AARP members, auto club members, teachers, and parents belonging to a parent/teacher organization are part of a special interest group.

My point is this: each of us, whether we know it or not, is likely part of at least one special interest group. Some of us are members of such groups because we chose to be and, as mentioned before, others of us are members of such groups unknowingly.

When you hear a news commentator or a radio talk show host talk about special interest groups, remember that you’re probably part of such a group whether or not that is a specific group or family of groups.

What does all this have to do with the health care debate? It means that just about every position that is advanced will favor one group over others. It means that the members of a particular group are trying to protect their interests. This often also means that the interests of other special interest groups will be subverted. It means that politicians who have accepted donations from one or another of these groups may have more at stake then you or I understand.

When more than 15% of our country’s gross national product is in play, there will be some very tough fighting going on behind the scenes. This is really brought to light by the recent combination of several special interest groups that have heretofore been the enemies of each of the others with which they’ve now chosen to align. These groups include an insurance company group, a labor union group, and a “family values” group. Each of these groups appeared to be on opposing sides of the “health care crisis” issue until a few days ago. What are we to make of this alliance?

For one thing, we can safely conclude that not only does politics make for strange bedfellows, money does as well!

State Children's Health Insurance Programs

State children's health insurance programs have been around under a federal mandate for some 10 years. The mandate needs to be re-visited and that has been going on in earnest in Washington, D.C. since the beginning of this year.

These programs were originally intended to help the states provide health insurance to needy children whose parents weren't poor enough to qualify for Medicaid. As is too often the case when federal money is available, some states have been very creative with these "children's" programs. One lament over these programs was the fact that so many children remained uncovered. These states have decided that they'd be able to attract more children if they could permit people with incomes of two to three times the poverty level to enroll their children.

There were, according to the powers that be, still too many uncovered children. So, it was decided that the parents needed to be brought into the "children's" program since they would enroll for the coverage...and would enroll their children for coverage, too. The SCHIP costs grew accordingly.

During the ongoing debate over future funding of these programs, several states have been complaining that they're out of money and need stopgap funding in order to avoid disrupting these programs.

Among these states are Arizona, Michigan, Minnesota and Wisconsin. These four states cover more adults than children! According to a Wall Street Journal editorial on April 24th, Minnesota spent 92% of its grant insuring adults. Arizona spent two-thirds of its grant the same way.

We are witnessing the incremental creation of government-run health care without the pain and suffering of voting on the issues. These deals were concocted in the halls of Congress and no one appears to have understood the concept of unintended consequences. Or...they did understand and knowingly circumvented the will of the people to achieve what they weren't able to otherwise accomplish with HillaryCare.