[PassedOut]

In the spirit of Winston's apology, let me say that every US citizen who opposes massive healthcare reform is either a blithering idiot or a crook who benefits from the current scams.

As I've mentioned before, our businesses received notification in October that our health insurance premiums were going up another 25.8%, the latest of a long series of substantial rate increases. Finally it seems that some people are taking notice: California Death Spiral

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Here’s the story: About 800,000 people in California who buy insurance on the individual market — as opposed to getting it through their employers — are covered by Anthem Blue Cross, a WellPoint subsidiary. These are the people who were recently told to expect dramatic rate increases, in some cases as high as 39 percent.

Why the huge increase? It’s not profiteering, says WellPoint, which claims instead (without using the term) that it’s facing a classic insurance death spiral.

Bear in mind that private health insurance only works if insurers can sell policies to both sick and healthy customers. If too many healthy people decide that they’d rather take their chances and remain uninsured, the risk pool deteriorates, forcing insurers to raise premiums. This, in turn, leads more healthy people to drop coverage, worsening the risk pool even further, and so on.

President Obama clearly understands the importance to business of fixing the problem: Premiums, Profits, and the Need for Health Reform

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The other week, men and women across California opened up their mailboxes to find a letter from Anthem Blue Cross. The news inside was jaw-dropping. Anthem was alerting almost a million of its customers that it would be raising premiums by an average of 25 percent, with about a quarter of folks likely to see their rates go up by anywhere from 35 to 39 percent.

Now, after their announcement stirred public outcry, Anthem agreed to delay their rate hike until May 1st while the situation is reviewed by the state of California. But it’s not just Californians who are being hit by rate hikes. In Kansas, one insurance company raised premiums by 10 to 20 percent only after asking to raise them by 20 to 30 percent. Last year, Michigan Blue Cross Blue Shield raised rates by 22 percent after asking to raise them by up to 56 percent. And in Maine, Anthem is asking to raise rates for some folks by about 23 percent.

The bottom line is that the status quo is good for the insurance industry and bad for America. Over the past year, as families and small business owners have struggled to pay soaring health care costs, and as millions of Americans lost their coverage, the five largest insurers made record profits of over $12 billion.

And as bad as things are today, they’ll only get worse if we fail to act. We’ll see more and more Americans go without the coverage they need. We’ll see exploding premiums and out-of-pocket costs burn through more and more family budgets. We’ll see more and more small businesses scale back benefits, drop coverage, or close down because they can’t keep up with rising rates. And in time, we’ll see these skyrocketing health care costs become the single largest driver of our federal deficits.

That’s what the future is on track to look like. But it’s not what the future has to look like. The question, then, is whether we will do what it takes, all of us – Democrats and Republicans – to build a better future for ourselves, our children, and our country.

That’s why, next week, I am inviting members of both parties to take part in a bipartisan health care meeting, and I hope they come in a spirit of good faith. I don’t want to see this meeting turn into political theater, with each side simply reciting talking points and trying to score political points. Instead, I ask members of both parties to seek common ground in an effort to solve a problem that’s been with us for generations.

I would hate to think that the the coalition of idiots and crooks in the US is big enough to keep the current nonsensical system alive.

[kenberg]

I share your frustration but I think we should look at how it came about. Possibly there is still room to do something, but I think it needs more careful thought than has been applied.

Part I
You will recall this chart at
http://www.billpeckham.com/.a/6a00e54fc659...f61f0970b-500wi
You may also recall that I had a lot of trouble understanding it, but let's just concentrate on the left side where, I think I have it right, the per capita cost of healthcare is listed. It's $7,29o for the US, $2,902 for the UK. Good grief, that makes the case you might say. But wait. Has any supporter of the Senate Health Care bill described how passing this bill will reduce per capita cost of health care in the US from $7,290 to $2,902? Actually, I don't recall Obama, or Reid, or Pelosi, explaining how it will reduce per capita costs at all. But unless it does, the chart, the left side anyway, has no value as an argument in support of the bill.

You, as a business owner, naturally would like to see the cost of health insurance for employees reduced. Fair enough. But unless per capita costs are lowered, the burden will be shifted, not eliminated. I have come to understand that when someone wishes to shift a burden, often I am in their crosshairs.


Part II
"The bill is revenue neutral, or even somewhat helpful", so we are told. But many are skeptical and they have their reasons. First an analogy that I thnk has relevance. Right now we are in the process of selecting a contractor to tear down our back porch and build us a new one. It costs a bit, can we afford it? Well, yes, in a sense. But we cannot afford to do this, take a trip this summer to Paris, have our lwan landscaped, and buy a Jaguar. If we do one, we don't do another. There is to be a tax on tose with high incomes, gratefully "high" means "higher than mine". But there are only so many of those guys and they only have so much money. There are bridges to be inspected and in some cases rebuilt, there are kids to be educated, there are environmental issues to be addressed and so on. Even Bill Gates lacks the money to finance it all. Financing the planned health care initiatives is obviously better than not financing them, and I do think the rich, and for that matter the non-rich but comfortable such as myself, should accept an obligation to pay for things that need doing. But the money is not inexhaustible and we have one hell of a debt. If my finances resembled the country's finances, we would be making do with the old porch.


Part III
Very unfortunately, the republicans, many of them, view crushing Obama as more important than accomplishing something. Also unfortunately, the leadership from the White House has been sadly lacking. Folks can easily get the idea that they are being scammed, and I think that there is something to it. Having raised the specter of the high per capita cost for health care, Mr. Obama, at his health care summit, might want to engage in serious discussion of what to do about it. If the reforms can be clearly and honestly presented as reducing per capita costs instead of shifting the costs from A to B, I imagine that such an approach might get a more sympathetic hearing.


Bottom line: Mr. Obama inspires many with his speeches. It's not enough.

[helene_t]

To me, the death spiral sounds like a very attractive thing. If enough people with decent income can't afford to be insured, there will be an incitement for health care providers to offer services at competitive prices.

I think the govt would do well to stop all tax deductions and other subsidies, in order to accelerate the process.

[PassedOut]

kenberg, on Feb 20 2010, 11:34 AM, said:

You, as a business owner, naturally would like to see the cost of health insurance for employees reduced. Fair enough. But unless per capita costs are lowered, the burden will be shifted, not eliminated. I have come to understand that when someone wishes to shift a burden, often I am in their crosshairs.

There are many problems to be addressed.

Aside from the huge amount of waste in the US system, which absolutely must be reduced, we need to look at who is paying for it. A serious problem with health insurance is that many people do not have it, but they receive expensive emergency care nevertheless whenever they need it. And that care is heavily subsidized by those of us who do pay for insurance.

The insurance "death spiral" described by Paul Krugman results specifically from many folks dropping their insurance, accepting the risk of some adverse financial outcomes, but knowing full well that the rest of us must pick up the tab when they get really sick. Those are the deadbeats in the crosshairs who must not be allowed to game the system.

[Winstonm]

PO,

I applaud you for being a business owner and creating needed jobs. I also share your angst over rising health-care costs.

Myself, I am the employee rather than owner. Our ownership is out getting new bids as we also got hit with a 35%+ increase. But even shopping prices is not all that helpful - especially this late in the year. The deductibles apply to the calender year so any money paid this year would not apply to the new company and the new deductible. And a change now means the decuctible I pay going forward is only for a partial year. So the little money saving on rates is couteracted by increased cost of plan deductible - and the same scenario may occur again next year and the year after, etc., meaning no real savings to me but to the company. (I appreciate the company helping providing the insurance, but I am not dumb enough to believe they are shopping price for my benefit.)

The only possible method of positive healthcare reform is to ignore politics and power and do what is in the best interests of We the People - but now that the Supreme Court has ruled that when it comes to influencing decision making that United Healthcare and We the People are equals, I fear the odds of that ever happening are prohibitive.

[PassedOut]

Winston,

I loathe the common company PR tactic of claiming that reductions in company benefits are for the employees' own good. Several years ago we did have to replace a wonderful plan for a lesser one when the premiums for the plan we liked increased more than double. I did not sugar-coat that to anyone. Now the premiums for that lesser plan are going out of sight too.

If the extra premium money bought wonderful health care for everyone here, that would be okay. But it really goes to pay for waste and for people who game the system. And the money paid out for that nonsense is not available for salary increases.

[Winstonm]

The really irritating part is that we could keep our present insurance system by adopting the Dutch model - but that would mean creating an equal playing field for all insurance companies, heavy government regulation, and subsidies for the poor.

Try getting that through Congress.

After all, how dare we think of giving money via subsidies to our non-productive poor when there are at least one or two hundred more brown-skinned foreigners (guilty or innocent doesn't really matter) in distant lands that are alive and still not on our side when it comes to supporting us invading their countries, when governent regulation=communism, and when equality of choice is an anti-capitalistic, Euro-lovin', hippie-actin', French-speaking, sissified liberal-lovin' scam?

Maybe politician's shouldn't think so much about running for office and come up with a plan.

Tremors:

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Earl Bassett: What we need is a plan.
Valentine McKee: I say we make a run for it.
Earl Bassett: Run for it? Running's not a plan! Running's what you do, once a plan fails!