A CHANCE TO COMPARE, A HIP STORY

In their 7/7/2015 Op-Ed “The Coming Shock in Health-Care Cost Increases”  Ezekiel Emanuel, one of the guiding forces behind the Affordable Care Act (ACA), and Tophor Spiro state:

Still, most analysts expect that the growth in health-care costs will rise without further action. And the latest data from the Census Bureau indicate this acceleration may be starting. The country is at an inflection point: Will we let our foot off the brakes, or will we permanently bend the cost curve?

Just a few years in and not fully implemented, The Affordable Care proponents are out giving dire warnings of uncontrolled rise in heath-care costs. Isn’t this exactly what the ACA’s opponents predicted?  Ah, Emanuel & Tophor have come up with a solution:

 Before it is too late, the Obama administration must focus on a reform that can be scaled. Medicare should lump together physician services, hospital costs, tests, medical devices, drugs and rehabilitation services related to common ailments—such as broken hips, heart stents and cancer treatments—into a bundle. It could then pay a medical provider a discounted amount for the whole array of services.

Wow, what a discovery!  Imagine common procedures sold as package or bundle at an all inclusive price. Why hasn’t anyone ever thought of this before?  Oh wait, in areas not commonly covered by insurance or government programs, package pricing has been the norm.  For instance, Cosmetic surgery, Lasik and many dental procedures  are ones that people pay for out of their own pockets  and are regularly priced as a package.  Google Lasik or breast augmentation and you’ll have offers covering what the whole procedure will cost.  Even if you were going to pay yourself for a hip replacement or stents by Medical Tourism, you’d be offered a package price covering everything often including transportation.  More importantly the cost history of any of these compares very favorably to areas where the Government and insurance companies dominate.  Taking inflation into consideration Lasik has had hardly had a price increase.  The same seems to b true of breast augmentation surgery.

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You didn’t listen, now what?

We all can see what has happened in the Middle East, Isis gains, Iraqi Soldiers run away and the battle between the Sunni and Shia camps  rages across the area.  United States Policy has moved to an even more confused state, if that’s possible.  We ship arms to the Shia led Iraqi army that promptly leaves them on the battlefield for Isis as they run away.  So we are in a slightly roundabout way arming Isis.  We are negotiating the timetable for Iran to go nuclear but giving some support to Saudi Arabia in Yemen.  We attack Isis in both in Syria and Iraq while arranging training for rebels to fight Iran’s ally Assad.  There may be a brilliant strategy behind all this but unless we are missing great genius, the U.S. has the confused and lost the trust of everybody involved.

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Where do you find the Answers? Try Milton and Rose

We, of course, expected cries of war mongers about our position on Iran, but we stand by it. The alternative is far worse.  On the other hand, people who might agree with our stand on zero tolerance for rioters in Baltimore or anywhere else, still ask what would you do about the underlying problems that lead to these protests?  In order to  provide answers we have to move from commentary to actual policy proposals.  To do so, we need help from some notables both living and dead.  The first one we turned to was President Obama who when faced with a long entrenched policy he felt was at a dead end said ” I do not believe we can keep doing the same thing for over five decades and expect a different result.”  While he said in reference to Cuba, the point was well taken. Instead of doing the same unsuccessful things decade after decade, it just might be worthwhile to head in a different direction.  Baltimore like many other of our cities have had one party rule for decades.  That means a certain political philosophy has governed the decisions and the general direction that have brought them to their present deplorable state.  Democrats who ruled all these years, adhere to a big government creed that goes back to the great depression.  Then It received its economic gravitas from John Maynard Keynes who proposed that government action could ameliorate the negative aspects of the business cycle.  After his passing, like minded economists such as John Kenneth Galbraith expanded on this government primacy philosophy to a system where government was the supreme arbitrator between Capital, represented by Big Business, and Labor represented the unions.  On the level of cities like Baltimore this has come to mean unaccountable positions for public employee unions, such as the police and teachers unions. They provide the money and reliable voters to for democrat politicians to prevail. The cost is unfunded pensions and an inability to fire bad or unproductive employees.  Businesses close to City Hall get contracts, zoning and tax breaks in return for their support.  How else can you explain more than 2 billion dollars Stimulus money not making any notable difference in Baltimore’s major problems in education,employment and overall economic growth.  Only the politicians, crony capitalists and unions seem to  made out.  Freddie Gray’s Sandtown-Winchester  neighborhood just continued its downward spiral. John Maynard Keynes was never without contemporaries who pointed to a different path forward.  Chief among them was Friedrich von Hayek, who saw this government dominance as leading us down “the Road to Serfdom” in the book by that name.  Later the NeoKeynesians moved us further down this road, but also had opposition and one who stood out was Milton Friedman along with his collaborator wife  Rose.  From Ronald Reagan to today’s majority of the Nations Governors, his smaller government individual centered way forward has offered an alternative to the philosophy that has brought Baltimore and similar cities to their present dire circumstances.  In light of this we may do well to ask what would Milton and Rose do? Even though both he and Rose are gone, they left us with starkly different policy proposals from those practiced in these faltering cities.  Education, employment and and how a city achieve economic growth were all tackled by the Friedmans.  It was Milton that said “One of the great mistakes is to judge policies and programs by their intentions rather than their results.” Continue reading

We’re Confused about Indiana

We have to admit, we didn’t really follow all this photographers and bakers and gay wedding controversies  as closely as we maybe should’ve.  Silly us, we thought this was a personal service case or by extension personal servitude problem, but this somehow is bound up in religion and gay rights.  When you get into an argument it may go off the rails if the wrong principles in invoked.  A photographer refuses to render his personal photography service to a Gay wedding on religious grounds and loses under a state anti discrimination law.  Take Gay and religious freedom out of the case entirely.  A asks B to provide a good or service which requires a future meeting of the minds.  B refuses by saying they are not a good fit.  End of story.  Professionals have done this forever.  For whatever reason your heart isn’t in it and you can’t provide your best product or service you bow out.  That protects both A & B from shoddy or worse outcome.  Professionals have always had the right to not take on a client without providing any reason.  “Just not a good fit” suffices.  Judges most of whom were in private practice know this and should extend this logical choice to everyone.

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THE SIMPLICITY OF DAVE’S PLAN

A common reaction we’ve received to Dave’s Plan to reform the Affordable Care Act (ACA) is that it’s just too complicated.  Why mix retirement and other savings plans in with medical care reform?  Actually the point was to simplify both by reestablishing the link between savings and expenditures. In the U.S. as with many other countries we don’t save as much as we should.  This leads to problems as populations age. In the not too distant future entitlements for the retirees will crowd out most other Government spending.  That of course will prove to be impossible.  For instance, we just might need a national defense.   Australia looking at a similar future has already opted for a mandatory 10% savings plan.  It isn’t that we don’t have people participating in retirement plans.  According to the American Benefits Council, defined contribution plans such as 401ks had 74 million active participants and that was in 2010.  In that year total employment was 138,641,000.  Employer health plans cover the majority of Americans.  Obviously, we have a good base.  All we are proposing is the accounts be held by Individuals with employers and the self-employed making the payments directly into Personal Benefits Accounts (PBA).  Add a Catastrophic Health Policy to the PBA and everybody having one and we have the basics.  We kept the ACA’s popular features of making the policies non-cancel able and children being able to stay on their family policy till 26. The ACA Subsidies and Medicaid payments based on age group experience would be deposited directly into qualifying PBAs by the IRS when their tax forms are processed, just as we do the Earned Income Tax Credit.  With the PBA’s constant inflow of funds and growth, adding a Medical Credit Card completes the package. Continue reading