Sunday, July 01, 2012
Obamacare: the good, the bad, the unpredictable & the dangerously unknown
If you’re having a hard time figuring out what the real status of Obamacare is, don’t feel badly What you are seeing in the current news coverage and debate is another reflection of of the dysfunctional state of our leadership class, a dysfunction driven in no small part by the fact that our political debates have become increasingly controlled by a post grad elite – lawyers, MBAs, economists, and products of journalism school - to a degree never before known in American history. This elite has replaced conscience with complexity, explicit goals with fuzzy projections, facts with verbiage, plain language with legalistic code, doing things with data, and progress with process.
For example, in recent years the number of lawyers in the Senate has varied from 54 to 60 - or nine to ten times the percentage found in the American workforce.
Throughout history, good politics has depended on high social intelligence and wisdom, connections with a constituency, and the ability to understand and respond to the needs of the average citizen. As our politics has increasingly been dominated by a grad school elite, it has become ever more distant from those it is meant to serve. Further, the training of this elite has tended to compartmentalize its thoughts into the boxes and biases of specific specialties, leaving it uncomfortable or incompetent in dealing with the holistic implications of politics.
If you think this is an exaggeration, go back and read about the battle for a minimum wage, Social Security, Medicare, Medicaid or civil rights. The public knew what they were going to get and how they were going to get it. This is no longer the case.
Or consider the fact that our current depression has been greatly prolonged by economic theories acceptable to the country’s academic, political and media elite but which are in direct contradiction to empirical evidence.
What was once a government of laws has become a government of incoherent contracts and language not unlike that you avoid reading on your computer in order to get your new software going.
We are a nation collapsing from the top. Most Americans live in oases of still relative sanity but are controlled by an elite that has lost its capacity to converse with, explain to, or lead the rest of the land.
Further, the liberal part of this leadership class has increasingly become indifferent to, or contemptuous of, state and local power, despite the fact that Americans have a much higher opinion of the local than they do of Washington. Liberals also once had quite a different view – after all, power decentralization was a major value of the left in the 1960s – and even Washington had a better idea of how to handle the matter. As I noted once:
The Federal Boating Act of 1958 was an early and benign example of what I came to think of as federal greenmail as Washington increasingly began using the budget as a means of getting states to give up their 10th Amendment authority over matters "not delegated to the United States by the Constitution, nor prohibited by it to the States."
The boating act was quite mild by today's standards. A Coast Guard history said of it: "Among other benefits, this act made states essential partners in this cooperative effort. Most of the states quickly enacted boating safety laws involving boat numbering, equipment, and operation. These laws were typically uniform, making it easier for boaters to be in compliance when traveling from one state to the next.”
Under today's rules the options given the states would have been early eliminated in favor of hundreds of pages of federal regulations. Over the following decades the use of greenmail would explode .
The liberal obsession with federal control has reaped not only bad legislation but much of the ill will that makes liberalism such a weak part of today’s American political scene.
For example, liberals love the commerce clause of the Constitution because, in their eyes, it permits them to do whatever they want on the false grounds that they are regulating interstate commerce.
In fact, the Atlantic Wire points out that Barack Obama opposed Justice Roberts’ nomination partly on this ground:
In 2005, Sen. Barack Obama spoke in opposition to Roberts' nomination, saying he did not trust his political philosophy on tough questions such as "whether the Commerce Clause empowers Congress to speak on those issues of broad national concern that may be only tangentially related to what is easily defined as interstate commerce." Today, Roberts did what Obama predicted he would do.
In other words, Obama was afraid that under Roberts, Congress would not be able to use the commerce clause casually and carelessly. He was right, because as Justice Roberts pointed out in the Obamacare case:
Construing the Commerce Clause to permit Congress to regulate individuals precisely because they are doing nothing would open a new and potentially vast domain to congressional authority. Congress already possesses expansive power to regulate what people do. Upholding the Affordable Care Act under the Commerce Clause would give Congress the same license to regulate what people do not do. The Framers knew the difference between doing something and doing nothing.
Of course, using “tangentially related” arguments is much of what Washington is about these days. The Senate even sneakily got Obamacare going by making it an amendment to a House bill, thus circumventing the constitutional requirement that revenue and tax bills originate in the House.
This does not, however, mean that even in a dysfunctional culture, good can’t and doesn’t happen and it has with Obamacare. But it is randomly and corruptly blended with the evil and the incompetent and the dangerously uncertain. The elite’s two main political divisions want us to choose between loving Obamacare and hating it. But we owe nothing to them and the wise choice – painful as it may be – is to sort through the mess and find the good and the bad and treat them as independent satisfactions and problems. Here, from various sources, is some assistance in this effort
Insurers have less ability to change the amount customers have to pay for their plans.
Insurers can't just drop customers once they get sick.
Insurers need to have an appeals process for when they turn down a claim, so customers have some manner of recourse other than a lawsuit when they're turned down.
If any state can come up with their own plan, one which gives citizens the same level of care at the same price as the PPACA, they can ask the Secretary of Health and Human Resources for permission to do their plan instead of the PPACA. So if they can get the same results without, say, the mandate, they can be allowed to do so. Vermont, for example, has expressed a desire to just go straight to single-payer (in simple terms, everyone is covered, and medical expenses are paid by taxpayers).
Now, here’s where it get complicated. . . . .
We do not know what plans insurance companies have to work around the bill in order to earn more money. The measure is dependent upon de facto subsidies to these companies through such means as the mandate and therefore the insurance industry’s manipulations are critical to the bill’s costs.
The rules for expansion of Medicaid require payments from state budgets which more than a few states don’t want to have to come up with. How much of this is verbiage and how much is reality remains to be seen, but to the extent that states don’t participate, it’s a problem. As Elsbeth Reeve in Atlantic Wire noted:
As Margot Sanger-Katz writes in National Journal, if states refuse to expand Medicaid, there's no other provision in the Affordable Care Act to cover the very poor. "The decision puts these poorest residents in a difficult position. They’ll be required to buy insurance but ineligible for Medicaid," she writes. Daniel Hawkins at the National Association of Community Health Centers tells her, "you are effectively consigning them to health insurance hell.”
The Supreme Court ruling that the mandate is a tax puts the Obama campaign in a difficult political situation. As Talking Points Memo put it:
Employers with more 50 or more workers are required to have health insurance, but what if some break up their firms into smaller operations? And what if smaller firms drop their health plans? And what if large firms change the nature of their health insurance? How many will be hurt and in what ways?
How will millions of Americans know what to do about this bill and when? This is a bill written for bureaucrats and insurance companies, not ordinary citizens,
And here are some of the people the individual mandate will be subsidizing:
Ida Hellander, MD- The individual mandate compels people to pay a penalty — the greater of up to $695 per individual and $2,085 per family or 2.5 percent of family income — if they don’t have other coverage and fail to purchase an expensive and defective private health insurance product.
While the mandate may be “constitutional,” it is terrible health policy. Briefly, the main problems include:
The coverage under the ACA is so skimpy, with so much cost-sharing, it won’t prevent medical bankruptcy. It’s really “underinsurance.” The coverage is unaffordable. In Massachusetts, where a mandate plan has been in effect since 2006, the cheapest policy for a 55-year-old is $5,000 and carries a $2,000 deductible. It costs $7,000 before even a penny of coverage kicks in. The burden of the mandate falls on working and middle-income families, who make too much for Medicaid but too little to afford private coverage, even with the tax subsidies. It enriches the private insurance industry with $447 billion in taxpayer subsidies. It maintains the administrative complexity of the current system with over $400 billion squandered on administrative waste The vast majority of the uninsured are in working families. Hence, they are already paying taxes to support Medicare (which pays for medical training and other necessary health infrastructure), Medicaid, and other health programs. It doesn’t lead to anything even close to universal coverage. ACA leaves at least 26 million uninsured.
Since August 2011, 89,000 children in Pennsylvania have lost their Medicaid coverage, including many with life-threatening illnesses who were mistakenly deemed ineligible. The state currently hasn’t a clue whether many of these children have any health care coverage at all. In late summer, the Pennsylvania Department of Welfare began notifying hundreds of thousands of families by mail that they had ten days to provide necessary documentation in order to keep their children enrolled in Medicaid. If the family missed the deadline—or even if they met it but DPW failed to process the paperwork within the ten days—they were dropped from Medicaid.
Finally, perhaps the best thing about the bill is that it makes Medicare for all seem simple, sensible and sweet.
Posted by Sam Smith at 8:55 PM