Donald Berwick may have mastered the science of health care management and delivery. (I for one would jump at the chance to enroll my family in the Berwick Health Plan.) But his recent oped in the Washington Post shows he has yet to absorb the lessons that economics teaches about government planning of the economy, such as through ObamaCare.
Berwick, whom President Obama recess-appointed to be administrator of the Centers for Medicare & Medicaid Services (CMS), sets out to defend ObamaCare from a fairly devastating critique by Robert Samuelson a few days earlier. Berwick responds, in essence, nuh-uh:
I saw how this law is helping tens of millions of families and is finally putting our health-care system on the right track…I have seen how improving care can reduce costs dramatically.
Berwick fails to see the world of difference between those two statements. Yes, in his private-sector work, Berwick has helped hospitals save more lives, kill fewer people, and save money in the process. I’m pretty sure he has saved more lives than I ever will.
But all he saw from his perch at Medicare’s helm was people happy to receive checks from the government, and a bunch of well-meaning bureaucrats setting goals. He did not see the costs imposed by those subsidies. As for goal-setting, this one sentence captures it all:
The CMS, for example, has set ambitious goals to reduce complications that, if met, would save 60,000 lives and $35 billion in just three years.
Berwick’s claim that ObamaCare “cracks down hard on waste and fraud” because “Last year the government recaptured a record $4 billion” is even more ridiculous. The official (read: low-ball) estimates are that CMS loses $70 billion per year to fraud and improper payments. The best evidence suggests that wasteful spending approaches $200 billion per year in Medicare alone. All that money that comes from you, John Q. Taxpayer. Berwick knows all these things. Yet he thinks you should be impressed that recovering a measly $4 billion is the best the government has ever done.
Berwick would never tolerate such willful blindness, shoddy reasoning, and (surprise!) poor results if it were his own money on the line. Which is exactly the point. In a free market, people spend their own money. At Medicare, Berwick spent, and ObamaCare continues to spend, other people’s money.
That is the main reason why markets are smart and government is stupid. And why otherwise smart people like Berwick can afford to keep their eyes shut.
It is becoming apparent even to members of the party that gave us ObamaCare that helping to implement the law by establishing a health insurance Exchange is a bad deal for states. Yesterday, NewHampshireWatchdog.org reported:
Governor Lynch blocks Health Insurance Exchange for NH
(CONCORD) Governor John Lynch [D] this morning signed legislation blocking implementation of a health insurance exchange in New Hampshire. The Obama Administration has been urging states to set up exchanges under the Patient Protection and Affordable Care Act, known as ObamaCare.
Lynch has supported setting up a New Hampshire exchange, including the proposal in his State of the State address in February. Senate legislation setting up an exchange, SB 163, won Committee approval in January before stalling on the Senate floor. Opponents argued that a state-run exchange would put New Hampshire taxpayers on the hook for the costs of administering much of the federal health care law, while giving the state little flexibility from federal mandates.
Representative Andrew Manuse (R-Derry) introduced HB 1297 to prevent state officials from setting up an exchange without legislative approval. Josiah Bartlett Center President Charlie Arlinghaus led the charge for the bill, arguing that if federal officials wanted to set up a New Hampshire insurance exchange, they could pay for it themselves. (The Josiah Bartlett Center for Public Policy is the parent organization of New Hampshire Watchdog.)
Under the new law, state health and insurance officials may share information with their federal counterparts but may not take any steps to implement a state-controlled insurance marketplace.
Governor Lynch’s office did not respond to requests for comment on HB 1297.
It does not speak well of ObamaCare that Democrats are heading for the exits.
In this video, I explain why all states should flatly refuse to create an ObamaCare Exchange:
For the true ObamaCare junkies, I include my oral and written remarks to New Hampshire legislators back in February about the dangers of creating an ObamaCare Exchange (non-junkies should just stick to the above video):
And let’s not forget Jonathan Adler’s latest take:
Jonathan H. Adler is the Johan Verheij Memorial Professor of Law and director of the Center for Business Law and Regulation at Case Western Reserve University. In this new Cato Institute video, Adler explains how a recently finalized IRS rule implementing ObamaCare taxes employers without any statutory authority.
For more, see this previous Cato video, “States Should Flatly Reject ObamaCare Exchanges”:
See also our November 2011 op-ed on this IRS rule that appeared in the Wall Street Journal.
Yesterday, Cato released “The Independent Payment Advisory Board: PPACA’s Anti-Constitutional and Authoritarian Super-Legislature,” by the Goldwater Institute’s Diane Cohen and me.
Today, National Review Online publishes our op-ed based on that study. An excerpt:
[U]nder the statute as written, if Congress fails to repeal IPAB in 2017, the secretary must implement IPAB’s edicts even if Congress votes to block them. Nancy Pelosi was right: We needed to pass ObamaCare to find out what was in it. We’re still finding out.
ObamaCare is so unconstitutional, it’s absurd. It delegates legislative powers that Congress cannot delegate. It creates a permanent super-legislature to supplement—and when conflicts arise, to supplant—Congress. It tries to amend the Constitution via statute rather than the amendment procedure of Article V.
ObamaCare proves economist Friedrich Hayek’s axiom that government direction of the economy threatens both democracy and freedom. After decades of failing to deliver high-quality, low-cost health care through Medicare, Congress struck upon the “solution” of creating a permanent super-legislature—or worse, an economic dictator—with the power to impose taxes and other laws that the people would reject.
Fortunately, one Congress cannot bind future Congresses by statute. If the Supreme Court fails to strike down ObamaCare, Congress should exercise its power to repeal IPAB—and the rest of ObamaCare with it.
Cohen is also the lead attorney for the plaintiffs in Coons v. Geithner, which challenges the constitutionality of IPAB and which a federal court has put on hold pending the Supreme Court’s ruling in the individual-mandate and Medicaid-mandate cases.
Remember that guy?
Well today, the Wall Street Journal reprints a series of emails showing how his administration colluded with drug-company lobbyists to pass ObamaCare. Never mind the nonsense about Big Pharma making an $80 billion “contribution” to pass the law. An accompanying Wall Street Journal editorial explains that Big Pharma “understood that a new entitlement could be a windfall as taxpayers bought more of their products.”
The money quote from these emails comes from Pfizer lobbyist/Republican/former George W. Bush appointee Anthony Principi. Even though the drug companies were donating to all the right politicians and pledging to spend hundreds of millions of dollars on pro-ObamaCare advertising campaigns and grassroots lobbying, President Obama still accused unnamed ”special interests” of trying to stop ObamaCare in order to preserve “a system that worked for the insurance and the drug companies.” Principi was indignant:
We’re trying to kill it? I guess we didn’t give enough in contributions and media ads supporting hcr. Perhaps no amount would suffice.
The nerve. I smell a campaign slogan. “Barack Obama: a Politician Who Cannot Stay Bought.”
The Journal adds:
[Former Energy and Commerce Chairman Henry] Waxman [D-CA] recently put out a rebuttal memo dismissing these email revelations as routine, “exactly what Presidents have always done to enact major legislation.” Which is precisely the point—the normality is the scandal.
And which critics have argued from the beginning. As I wrote more than two years ago, ObamaCare is corruption:
Each new power ObamaCare creates would be targeted by special interests looking for special favors, and held for ransom by politicians seeking a slice of the pie.
ObamaCare would guarantee that crucial decisions affecting your medical care would be made by the same people, through the same process that created the Cornhusker Kickback, for as far as the eye can see.
When ObamaCare supporters, like Kaiser Family Foundation president Drew Altman, claim that “voters are rejecting the process more than the substance” of the legislation, they’re missing the point.
When government grows, corruption grows. When voters reject these corrupt side deals, they are rejecting the substance of ObamaCare.
Fortunately, voters so detest ObamaCare that there’s a real chance to wipe it from the books. This video explains how state officials can strike a blow against ObamaCare/corruption:
The Washington Post reports:
For 14 months, a bipartisan group of 17 states has been quietly collaborating with the Obama administration to help build a foundation for the health-care reform law’s success.
The group includes some of the law’s staunchest supporters working alongside a handful of its bigger detractors. They are backed by $3 million in funding from eight nonprofit organizations that hope to see the Affordable Care Act succeed.
Together, they have come up with a tool to help consumers navigate the health insurance exchanges—the marketplaces that each state is required to have by 2014.
In other words, at the same time Alabama, Arizona, Colorado, and Kansas are suing to overturn Obamacare as unconstitutional, officials in those states are helping to implement the same unconstitutional law.
The Post reports, without rebuttal, several myths about the states’ role under Obamacare. It refers three times to the “tight deadlines” states face under the law. (There are no deadlines. HHS has said that if states decline to create exchanges, they can change their minds later.) It claims, “If a state does not have a framework in place by 2013, the Department of Health and Human Services will come in and do the job itself.” (That’s highly questionable. Obamacare appropriates zero funds for federal exchanges and HHS has admitted it doesn’t have the money.) It quotes Kansas insurance regulator Linda Shepphard as saying, “There is no work being done to build an exchange in Kansas at this point.” (Well, which is it? Is Kansas doing “no work,” or is it “collaborating with the Obama administration”?) I’d say certain state officials got some ‘splaining to do.
In the video below the jump, I explain to state officials why flatly refusing to create an Obamacare exchange is the best thing they can do for their states.
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