Tag: health care reform

Well, At Least He Should Know What Doesn’t Work

In today’s Washington Post, Chris Cillizza predicts that Mitt Romney “will move to seize the high ground (from a policy perspective) on health care over the coming months and is likely to be Obama’s leading critic when Congress takes up the legislation in the fall.” For anyone who thinks this is good news, I refer you to my post from last week regarding the many failures of Governor Romney’s last foray into health care reform.

A Not So Happy Anniversary for the “Massachusetts Model”

Three years ago yesterday, then-Governor Mitt Romney signed into law the most far reaching state health care reform plan to date.  At the time, we warned that the plan, with its individual and employer mandates, new regulatory bureaucracy (the Connector), and middle-class subsidies would result in “a slow but steady spiral downward toward a government-run health care system.” Sadly, three years later, those predictions appear to be coming true.

  • While the state has reduced the number of residents without health insurance, some 200,000 people remain uninsured. Moreover, the increase in the number of insured is primarily due to the state’s generous subsidies, not the celebrated individual mandate.
  • Health care costs continue to rise much faster than the nationally. Since the program became law, total state health care spending has increased by 23 percent. Insurance premiums have been increasing by 10-12 percent per year, nearly double the national average.
  • New regulation and bureaucracy is limiting consumer choice and adding to costs.
  • Program costs have skyrocketed. Despite tax increases, the program faces huge deficits in the future. As a result, the state is considering caps on insurance premiums, cuts in reimbursements to providers, and even the possibility of a “global budget” on health care spending.
  • A shortage of providers, combined with increased demand, is increasing waiting times to see a physician, especially primary care providers.

With the “Massachusetts model” being frequently cited as a blueprint for state or national health care reform, it is important to recognize that giving the government greater control over our health care system will have grave consequences for taxpayers, providers, and health care consumers. That is the lesson of the Massachusetts model.

Democrats Agree on Health Plan Outline: Be Afraid, Be Very Afraid

The New York Times reports that key congressional Democrats have agreed on the basic provisions for a health care reform bill.  And while many details remain to be negotiated, the broad outline provides a dog’s breakfast of bad ideas that will lead to higher taxes, fewer choices, and poorer quality care.

Among the items that are expected to be included in the final bill:

  • An Individual Mandate. Every American will be required to buy an insurance policy that meets certain government requirements.  Even individuals who are currently insured – and happy with their insurance – will have to switch to insurance that meets the government’s definition of acceptable insurance, even if that insurance is more expensive or contains benefits that they do not want or need.  Get ready for the lobbying frenzy as every special interest group in Washington, both providers and disease constituencies, demand to be included.
  • An Employer Mandate. At a time of rising unemployment, the government will raise the cost of hiring workers by requiring all employers to provide health insurance to their workers or pay a fee (tax) to subsidize government coverage.
  • A Government-Run Plan, competing with private insurance.  Because such a plan is subsidized by taxpayers, it will have an unfair advantage, allowing it to squeeze out private insurance.  In addition, because government insurance plans traditionally under-reimburse providers, such costs are shifted to private insurance plans, driving up their premiums and making them even less competitive. The actuarial firm Lewin Associates estimates that, depending on how premiums, benefits, reimbursement rates, and subsidies were structured, as many as 118.5 million would shift from private to public coverage.   That would mean a nearly 60 percent reduction in the number of Americans with private insurance.  It is unlikely that any significant private insurance market could continue to exist under such circumstances, putting us on the road to a single-payer system.
  • Massive New Subsidies. This includes not just subsidies to help low-income people buy insurance, but expansions of government programs such as Medicaid and Medicare.
  • Government Playing Doctor.   Democrats agree that one goal of their reform plan is to push for “less use of aggressive treatments that raise costs but do not result in better outcomes.”  While no mechanism has yet been spelled out, it seems likely that the plan will use government-sponsored comparative effectiveness research to impose cost-effectiveness guidelines on medical care, initially in government programs, but eventually extending such restrictions to private insurance.

Given the problems facing our health care system-high costs, uneven quality, millions of Americans without health insurance–it seems that things couldn’t get any worse.   But a bill based on these ideas, will almost certainly make things much, much worse.

Or maybe it’s all just a massive April Fool’s joke.

What ‘Universal Coverage’ Really Means: Higher Taxes, Government Rationing

An editorial in today’s Wall Street Journal earns that page a membership in the Anti-Universal Coverage Club.

The editors explain that the universal-coverage scheme Massachusetts enacted in 2006 is a perfect microcosm of what congressional Democrats are trying to foist on the rest of the nation: compel universal coverage now, worry about the costs later.

Massachusetts is three years into that strategy, thus its experience shows us where that strategy leads.  Much as my colleague Mike Tanner predicted (repeatedly), it leads to higher taxes and government rationing.  The WSJ editors write:

The state’s overall costs on health programs have increased by 42% (!) since 2006.

Like gamblers doubling down on their losses, Democrats have already hiked the fines for people who don’t obtain insurance under the “individual mandate,” already increased business penalties, taxed insurers and hospitals, raised premiums, and pumped up the state tobacco levy. That’s still not enough money.

So earlier this year, [Gov. Deval] Patrick appointed a state commission to figure out how to control costs and preserve “this grand experiment”…

The Patrick panel is considering one option to “exclude coverage of services of low priority/low value.” Another would “limit coverage to services that produce the highest value when considering both clinical effectiveness and cost.” (Guess who would determine what is high or low value? Not patients or doctors.) Yet another is “a limitation on the total amount of money available for health care services,” i.e., an overall spending cap…

[Patrick] reportedly told insurers and hospitals at a closed meeting this month that if they didn’t take steps to hold down the rate of medical inflation, he would.

The editors conclude:

The real lesson of Massachusetts is that reform proponents won’t tell Americans the truth about what “universal” coverage really means: Runaway costs followed by price controls and bureaucratic rationing.

Sen. Hatch Does Not Owe His Friend My Freedom

Here’s one idea that needs to be put down right now: that we should enact health care reform as a tribute to Sen. Edward M. Kennedy (D-MA), who has terminal brain cancer.

Sen. Orrin Hatch (R-UT) was recently quoted:

I would like to do [health care reform] as a legacy issue for [Kennedy], if I can – this would mean a lot to him.

I mean no disrespect to Sen. Kennedy.  Aside from those who have actually given their own lives for this country, few have given as much as he has.  I wish him peace, and a miraculous recovery.

My problem is with the choice of tribute. The health care reforms that Congress is cobbling together would dramatically reduce each American’s freedom to control her income, run a business, and make her own health care decisions.

The United States of America is a republic.  We do not make tributes of our citizens or their rights to the aristocracy.  Sen. Hatch does not owe his friend my freedom.

Who’s Blogging about Cato

Here’s the latest round-up of bloggers who are writing about, citing and linking to Cato research and commentary:

  • Blogging about Real ID, AxXiom for Liberty posted Jim Harper’s piece about DHS officials who skirted open meeting laws to promote the program.
  • No Land Grab, a blog covering eminent domain abuse, posted the latest Cato video on the Susette Kelo case. Jason Pye, who wrote a commentary on the case for the Georgia Public Policy Foundation, linked to it as well.
  • Sights on Pennsylvania blogged about international health care systems, citing Michael D. Tanner’s January article on health care reform and a 2008 Hill Briefing that compared various systems around the world.
  • Wes Messamore, AKA The Humble Libertarian, is compiling a list of 100 libertarian blogs/Web sites, and looking for recommendations. Last week, Wes penned his thoughts on the role of the U.S. in foreign policy, making heavy use of a recent Cato article by Benjamin Friedman and a 1998 foreign policy brief by Ivan Eland, citing military intervention overseas as a cause of terrorist activity against Americans.

If you’re blogging about Cato, contact Chris Moody at cmoody [at] cato [dot] org (subject: blogging%20about%20Cato) .

More on that Massachusetts ‘Model’

Amid reports that the Obama administration, congress, and some conservative groups still consider Massachusetts to be a model for health care reform, the New York Times reveals that despite assessing insurers and hospitals, raising the penalty on noncompliant businesses, increasing premiums and co-payments for consumers, and raising the state tobacco tax, the program’s financing remains unsustainable.

Massachusetts has significantly reduced the number of people in the state who lack health insurance. However, it has not achieved, nor does it expect to reach, universal coverage. (The best estimates suggest that more than 200,000 state residents remain uninsured). And, significantly, roughly 60 percent of newly insured state residents are receiving subsidized coverage, suggesting that the increase in insurance coverage has more to do with increased subsidies (the state now provides subsidies for those earning up to 300 percent of the poverty level or $66,150 for a family of four) than with the mandate.

The cost of those subsidies in the face of predictably rising health care costs has led to program costs far higher than originally predicted. Spending for the Commonwealth Care subsidized program has doubled, from $630 million in 2007 to an estimated $1.3 billion for 2009.

Now the state is turning to a variety of gimmicks to try to hold down costs, including possibly cutting payments to physicians and hospitals by 3-5 percent. However, the Times quotes health reform experts who have studied the Massachusetts system as warning “the state and federal governments may need to place actual limits on health spending, which could lead to rationing of care.”

The more one looks at the Massachusetts “model,” the stronger the argument for keeping the government out of health care.