As I had anticipated, the House has passed the Senate’s healthcare reform bill:
WASHINGTON — House Democrats approved a far-reaching overhaul of the nation’s health system on Sunday, voting over unanimous Republican opposition to provide medical coverage to tens of millions of uninsured Americans after an epic political battle that could define the differences between the parties for years.
With the 219-to-212 vote, the House gave final approval to legislation passed by the Senate on Christmas Eve. Thirty-four Democrats joined Republicans in voting against the bill. The vote sent the measure to President Obama, whose yearlong push for the legislation has been the centerpiece of his agenda and a test of his political power.
They then went on to approve a package of changes to the Senate’s bill. These changes had already been negotiated with Senate Democrats and are expected to pass quickly with a simple majority. I’m quite certain that President Obama will sign the bill into law once it’s passed the Senate.
I don’t know that any bill of comparably major importance has ever been passed on a strict party line vote with such ambiguous public support.
I’m not sure what’s in the final bill and I’m not sure that anybody else knows, either. As I’ve said before I strongly suspect that the pre-approved changes increase the cost of the Senate bill and decrease the already insufficient curve-bending measures in the bill, particularly the tax on so-called “Cadillac” healthcare insurance, the most direct cost control measure in the Senate bill.
Eza Klein seems confident that the cost control measures will persist. We’ll see. Most of the cost control depends on prudent action by future Congresses, never a good bet, and it should be remembered that controlling future Congresses is beyond Congress’s power.
Most of the those strongly in favor of the bill, like James Fallows, to my eye appear to like the idea of the bill rather than the bill itself.
I think it’s important to remember what this healthcare bill doesn’t do. It doesn’t treat any more people. To do that you’d need to have more healthcare than we do now and this bill does very little to expand the amount of healthcare that’s available. At most it spreads the existing healthcare around more equitably.
It doesn’t cause communities that are already underserved to be served better. That’s beyond the scope of this bill, something that really hasn’t been thought much about yet.
It doesn’t save any lives. Physicians are already ethically obligated to treat people without taking their ability to pay into consideration. Hospitals are legally required to provide emergency treatment without taking people’s ability to pay into consideration. If you believe that people are dying for lack of treatment, then you believe that physicians are acting unethically and hospitals are acting illegally, simple as that. Indeed, if the reductions in Medicare spending are actually enacted and physicians are acting unethically and hospitals are acting illegally, then more people may die.
It doesn’t reduce healthcare spending. Indeed, it increases total healthcare spending by roughly 10%.
It doesn’t bring healthcare costs down. It might in the future but that depends on a lengthy list of assumptions. It is possible that healthcare reform in this form will actually increase costs. When you throw more money at something where there’s a supply bottleneck, that can happen.
When the euphoria/doom and gloom has settled down, I hope that the people and the Congress recognize that we still need healthcare reform. It’s hard for me to imagine much stomach for it.
It’s not that doctors refuse to treat people who can’t pay. It’s that people who can’t pay don’t seek treatment.
You have evidence for that, Alex?
Then Dave’s point still stands.
That is not how you reduce costs. If anything the rate of increase of costs will likely increase.
Can? No, more like highly likely.
In other words, this isn’t reform. I agree with that. All it does is extend and further entrench our existing system which everyone agrees is broken. Which makes this legislation insane (no comment on those who support it, but logically the conclusion is not hard to reach). After all, isn’t the definition of insanity doing the exact samething expecting different results?
http://harvardscience.harvard.edu/medicine-health/articles/new-study-finds-45000-deaths-annually-linked-lack-health-coverage
It’s also worth mentioning that while doctors and hospitals are obliged to treat people, there is no legal requirement to provide ONGOING treatment (ie prescription drugs.)
It seems from my perspective that we are at the beginning of a very long period of high unemployment and underemployment, and I don’t see any likely way out of it. Because of that, and the likelihood that it will lead to continually high numbers of people with poor or no health insurance, I support the bill, but with serious reservations.
Your post is a good reminder of why I have those reservations.
“It doesn’t save any lives. Physicians are already ethically obligated to treat people without taking their ability to pay into consideration.”
So you’d rather have the poor show up at Kaiser and free-ride on my policy than have them cared for by government.
You don’t consider that free ride a “taking” then?
odograph, unfunded medical care is about 2.2% of national healthcare costs.
http://online.wsj.com/article/SB10001424052970204488304574425294029138738.html
Neither the article to which you linked nor the study it’s based on (and to which the original article does not appear to link) support your claim. The study finds that lack of insurance is associated with increased death rates. I agree.
The study does not attempt to disaggregate the underlying reasons for the higher death rate beyond lack of insurance. Your claim that people who aren’t insured don’t seek care remains unsupported.
I remain skeptical that the reconciliation package will be passed by the Senate without either (a) the introduction of an amendment or (b) a point of order that has the same effect. Either would send the bill back to the House for another vote. I don’t know that these machinations would improve the bill or not, but it’s simply in the Republican interest to keep the healthcare issue alive.
2% of a very big number is still a big number.
Not only that, it’s more than an ethical obligation isn’t it? It’s a mandate, right?
You’d rather mandate that Kaiser treats than that a broader pool funds? It sounds like an unfair taking to me.
“It doesn’t save any lives. Physicians are already ethically obligated to treat people without taking their ability to pay into consideration. Hospitals are legally required to provide emergency treatment without taking people’s ability to pay into consideration. If you believe that people are dying for lack of treatment, then you believe that physicians are acting unethically and hospitals are acting illegally, simple as that”
A concrete example, then references. My second to last patient last night had no insurance. He came in with a creatinine over 4. He was an untreated hypertensive. He had emergency surgery last night. He would definitely have died without it. However, even after resuscitation, his creatinine stayed over 3. He is on the road to renal failure and will die early. There is very good literature showing that treatment of hypertension, especially under the care of specialists, can delay or prevent renal failure.
Most who write on this issue are just thinking about the dramatic loss of life we prevented last night. The deaths that insurance is likely to prevent are the latter.
The references below say it all better than I can, but a few points. Much of medicine is not life saving. Think orthopedics, lots of GYN care, opthalmology, etc. It may make people more functional, but not save lives. We can get rid of those fields of medicine to save costs if we want, but that will have economic consequences also. Lastly, we know that a lot of medicine does not work at all. We overutilize a lot.
http://www.tnr.com/blog/the-treatment/the-connection-between-health-insurance-and-health-continued
McWilliams piece is excellent. He notes McArdle’s citation of the RAND study, which was done in the 70s. If any student came to me citing a paper that old that covered a period of just 3-5 years, I would be very disappointed.
http://theincidentaleconomist.com/letting-perfect-be-the-enemy-of-good/
Dorn’s was a nice review.
http://voices.washingtonpost.com/ezra-klein/2010/02/all_you_ever_wanted_to_know_ab_1.html
The McArdle piece was the worst thing I have ever read by her, and I read her almost every day. Mortality is not the only end point at which we look. She could have called up an actual expert who had conducted the studies. At the end of these, you will still not find 100% conclusive evidence. You never will. You are dealing with the fallacy of the perfect study. The study you want to prove beyond a doubt this linkage would cost billions if done on a large enough scale to be useful. No one will pay for it. However, there is an abundance of evidence that medical care improves specific outcomes and that the uninsured do not receive that care.
Steve
The Kaiser Family Foundation has a very nice summation of what is in the bill.
http://www.kff.org/healthreform/upload/housesenatebill_final.pdf
Steve
2.2% probably isn’t that significant compared with bad-debt write-downs in many industries. If we’re talking reigning in health costs, this should be worth scrutiny, but the discussion on TV yesterday was way out of proportion. And call me an elitist, but I’m not excited about wading through even larger lines of cold and flu sufferers at non-E.R. waiting rooms. At least at the E.R., they know how to prioritize.
Steve:
You’re offering concrete, real world, specific information about actual human beings.
I don’t think you understand your audience here. They don’t do humans: just numbers.
Since your standard of taxation/government intervention etc, Michael, is “care for humanity,” when do you start advocating that we fund the health care needs of every poor nation on earth? And because pursuit of health care for all the world’s humans would most assuredly bankrupt you personally, and this country, are you prepared at some point to “do the numbers?”
Gosh Drew, are there really such slippery slopes? Just because we have national defense that doesn’t mean we need to send our army around defending everyone else’s … no, wait.
Michael,
I think most of us “numbers” people are primarily interested in a sustainable system, which we don’t currently have and which this legislation doesn’t provide.
It would be nice, Andy, if the federal budget were broadly sustainable and this were the one outlier … unfortunately health care has to come on top of unfunded wars, tax cuts in the face of them, a Great Recession, etc., etc.
94 billion per year, is by some measures small potatoes.
Its a question of balance Michael, I’d hope even someone like you can understand vs. being and insulting shit, but I guess I expect too much from you.
See, if you ignore the aggregate numbers you might find yourself in a situation where caring for the humans is much, much harder.
steve,
To listen to half the dimbulbs in favor of reform like this it is. It is one of the few metrics that is used to say U.S. health care sucks (btw the obvious implication is you do shit work, HTH). The others are life expectancy and infant mortality. Those three metrics are it. Nothing else matters.
And that was the question at hand, mortality. Pollack doesn’t discuss much else other than mortality. Why isn’t his article bad? He even notes that while McArdle might be wrong, the gains from universal health care might not justify the costs.
Sure, but as Pollack points out it isn’t clear that this means we must have universal health care.
Did you even read the article by Pollack?
The title of you the other link you provide…my argument is that I’m not looking for perfect and I’d settle for good and this legislation is not it. If costs continue to spiral upwards this might have been the last chance to address the issue if Dave’s 10-15 year window is correct.
John,
Yes, most of us here recognize the sustainability problem of health care in particular, but also government more generally. I’m not sure what your point is.
Let’s start with Iraq, oh, too late, we already have! (constitution guarantees health care for it’s citizens, money is fungible, and it all comes from us.)
“Did you even read the article by Pollack?”
Yes, and I happen to agree with much of it (I was pretty sure you would like it if you read it), but the specific question was on mortality. I am actually pretty agnostic about a lot of the health care we provide. I think we do too much too often. We would do well, if health were the issue, to alter behaviors. However, we dont do that in this country. That liberty thing.
McArdle’s article was bad for a number of reasons, chief among them the reliance upon the Kronick study. It is an outlier. We dont generally jump to conclusions based upon one study, when almost ever other comes to the opposite conclusion. Her usage of the mortality at age 65 studies also showed that she had not really talked with anyone knowledgeable about medical issues, or at least not someone w/o a POV. At age 65 you have a large increase in utilization of services, especially surgical and invasive ones. They all have risks. So, if someone waits to 65, and retired on Medicare, to have their knee replaced, their is a chance they will die. Small but real. It is entirely possible that if you look only at total mortality, this may actually go up. We could stop this by just doing away with elective surgery and procedures, but is that what we want and is it germane to McArdle’s piece? Much better to look at the specific groups as done by McWilliams et al.
“my argument is that I’m not looking for perfect and I’d settle for good and this legislation is not it.”
Ahh, now we get into the opinion part. By my reckoning, this is a mediocre bill with potential for good. The alternative is no bill at all. Republicans have no real interest in the issue. Given the demographics of their base, it is not a winning issue. They held power while Medicare has grown out of control and private insurance costs also ballooned. There was no Republican leader willing to put his job on the line to advocate for health care reform.
In essence, I largely agree with Frakt, one of the best health care writers, today.
“Glaeser and I agree that running mostly with the crowd (or the majority, or even plurality, of it) while attempting to tinker with the direction where opportunities arise is the most practical way to influence policy. In the case of health care, I would have accepted many possible sets of comprehensive reforms, some far more government dominated, some far more market based. My principal criteria were that the reforms be internally consistent (i.e. technically sound to the point that they’d plausibly work and with support from empirical evidence) and politically feasible (i.e. not obviously counter to large interest groups so they had a chance of surviving the congressional gauntlet). But whatever comprehensive set of reforms satisfied those, that was the vehicle to try to steer, not too much so as to take it off-road, but just enough to improve the ride.
http://theincidentaleconomist.com/libertarianism-pragmatism-and-realism/#comments
Steve
That was dumb, odo. If you are a “humanitarian” you are a humanitarian. Period. Borders, be they California, USA, South America or Africa don’t matter; nor do numbers or practicalities.
So Michael’s mindless feel good “we care about people, they don’t” assertion is just crap. If you are Mother Teresa, then declare yourself so……..and to a life of poverty.
But to castigate a political group because “they care not about people, but care only about practical things like numbers” while not following through with the practical implications is just simple minded.
Not surprising for you or Michael.
Yes, which makes your complaint about McArdle’s focus on mortality…odd in that that was the specific question.
I think this is naive. Dave lays out the case pretty well. Much of the cost savings, for example, depend on future Congresses voting to cut Medicare payments. Is this likely? Search youtube for the video of Dan Rostenkowski being hounded out of a townhall meeting by angry seniors.
Between this bill and no bill I prefer the latter. Imagine the following:
You are near your limit in terms of expenses and income. Expenses, you anticipate, rising by 6% your income by 3%. Now is it a good time to take out a loan on your house, or look at ways at reducing the growth rate of your expenses. I see this bill has most likely being the latter. Yes it will save $1.2 trillion over twenty years, BFD, that is Obama’s deficit for this year alone. Next year we’ll likely have another $1.2 trillion dollar deficit.
Yes, the bill does have some measures to reduce Medicare, but again, BFD. All it does is take money slated to be spent on Medicare and move it to another federal spending program. That isn’t savings. Not at all. It is like taking out the loan in the example above?
And I bet wages will stagnate even more than they have been under this bill. Consider what the bill does regarding pre-existing conditions. These people are allowed to purchase insurance. That, by itself, will push up premiums. It has to. People with pre-existing conditions aren’t likely to get sick, they ARE sick. An actuarially fair premium for them is the cost of their treatment. But insurance companies cannot charge them that, so the costs have to be spread around. It is what in the economics of insurance is called a pooling equilibrium.* If nothing is done, then people who get their insurance via their employer will see the cost of their benefits go up, which means that all else being equal, wages go down. If you subsidize insurance to offset this increase that money has to come from somewhere so now taxes on income go up which lowers after tax wages. Pre-tax wages going up are meaningless to most workers (if not all of them) because it is the pre-tax wage that determines things like work effort and income. You can try borrowing the money, but then interest rates go up which makes it harder to get credit and will likely reduce growth. In the end, this money is coming from somewhere and that somewhere is largely going to be consumers/taxpayers (pretty much the same group). The last two options hide who is paying for it by using indirect mechanisms. And it will come either in terms of lower wage growth, higher taxes, or lower growth (i.e. lower overall economic well being) or all of the above.
We might just as well as call this the Insure America by Lowering Economic Living Standards and Growth Bill.
But WTF, its a historic moment, right?
meh.
Always with the Right-Left with some of you guys. Is this a good bill? I see little reason to think so and not because of any Republican or Democrat Bravo Sierra. I see the effects of this bill as being pernicious simply by putting it into a standard economic model and employing a bit of basic public choice theory on how politicians behave.
Yeah, but will it be enough? We have a huge projected shortfall in Medicare. That has not been addressed, really, in that the reductions slated for Medicare are being used to finance other spending.
This bill does not address the issue of costs, not really. It is at best, mildly deficit neutral, and at worst will make costs rise at an even faster rate. Was it politically feasible? Sure, it passed, but the question is will it go towards solving the problem, the real problem, the answer is an unequivocal no. Anyone who thinks it is has rose tinted glasses superglued to their face.
If wishful thinking is what you consider outstanding writing on health care reform then Frakt is indeed good. He can blather on about political feasibility, but that is a crap standard in that it has nothing about sufficiency of actually addressing the actual problem, in fact, I’d argue political feasibility goes towards not addrssing big problems as the solutions are often painful and politicians don’t like bringing home the pain to their constituents…much better to bring home the bacon. And if 12 years when you leave office and cash in on your nice DC rolodex then it is someone elses problem and you’ll hopefully be rich enough to avoid the worst parts of the problem.
*Note the pooling equilibria are only possible with government mandates since a seperating equilibrium always breaks the pooling equilibrium.
I think it’s also worth remembering that the CBO was directed to assume certain levels of savings that may, in fact, never materialize. Those pertain particularly to the various pilot programs, electronic record keeping, and comparative effectiveness.
I have direct experience going back 35 years or more in medical electronic record keeping and can say authoritatively that, although it’s a good idea, there is no likelihood whatever that it will result in material cost savings.
” Much of the cost savings, for example, depend on future Congresses voting to cut Medicare payments. Is this likely?”
My stock portfolio would suggest my predictive powers a re poor. Nonetheless, the following CBPP paper suggests that Congress has often made cuts it has kept. Will it do so this time? If it cannot start doing it soon, game is over anyway so I have to hope that they will follow their recent patterns and stick with it.
http://www.cbpp.org/cms/index.cfm?fa=view&id=3021
” People with pre-existing conditions aren’t likely to get sick, they ARE sick. ”
So what do we do with them? I think that there is compelling evidence that many of these people will die early. So do the people who write and publish in the field. Only a writer at the Atlantic who has no experience reading medical literature or ever worked in the field, plus some she has persuaded, believe that. Many others will be disabled. We can decide it is too expensive to care for them, but we should be honest about that option.
This also ignores the effect of the mandate. Here, I dont know the numbers, so if you have them feel free to let me know, but we will bringing in a number of healthy uninsured also. Will it be enough to offset the sick? I dont know. Do you?
“Yeah, but will it be enough? We have a huge projected shortfall in Medicare. That has not been addressed, really, in that the reductions slated for Medicare are being used to finance other spending.”
The immediate savings are going to finance the rest of the bill. The Advisory Board has the chance of cutting spending as we go along. I am sure you ahve already decided it will not work. I would point to the base closing commissions. Taking politically contentious issues out of the direct hands of Congress has worked in the past. Again, this is the first time anyone has even tried to pass a bill that will attempt to stop our wealth transfer from the young to the retired (that I can remember).
“This bill does not address the issue of costs, not really.”
I wish it had done more. However, even this minimal attempt to cut costs in Medicare, where we really need to cut costs the most, was politically torpedoed. Like it or not, you must consider what is politically feasible. I cannot imagine any other attempts to cut Medicare costs that would have been politically possible. We have many examples of other countries holding down costs better. They all involve major government intervention. We could try one of those proven systems, but we will not, at least not now, as they will seem too socialistic.
So, we must address the political. It is fun in blogland to conjecture about our favorite programs, the Singapore model, Wyden-Bennett, etc. In reality what we have is just one political party which is interested in the issue, so we are getting to get a solution with the strengths and weaknesses inherent to that political philosophy. The best part here, is that we get pretty close to getting everyone in the system. Ideally, it is a step towards getting everyone into the same system. It will be difficult to propose cutting costs just by dumping people. That means we will need to find real solutions. They exist, we just need the political will. (Note that other systems with lower costs expanded first.)
Both parties will be interested in cutting costs. We have just helped provide a stronger incentive to do it in a way which involves changing the system rather than cutting out the sick and poor.
“I have direct experience going back 35 years or more in medical electronic record keeping and can say authoritatively that, although it’s a good idea, there is no likelihood whatever that it will result in material cost savings.”
Possible. I think that the cost effectiveness research and the ACOs are more likely to achieve bigger results. OTOH, electronic accounting and data management seemed to play a big part in what economic growth we have had in the last 20 years. I wonder what would happen if we had real universal health care? Would we need so much security? Would that make EMRs more practical?
Steve
Drew:
Sorry not to have responded earlier, my screen thing (inverter?) is dead and I’m borrowing various computers till Apple fixes it.
When did I ever call myself a humanitarian? I don’t think I ever applied a label like that to myself.
Does it mean that I don’t think the world’s richest nation should choose a standard lower than every other developed nation on earth? If so, then I guess that makes me a humanitarian.
Maybe a more accurate label — I’m not sure if it’s an actual word, but what the hell — would be civilizationist. I believe we are not just about the business of making sure that you and Verdon get to keep every dollar you make and smoke all the weed you want. I think we’re also about the business of building a civilization.
I think in our civilization we should make sure that even poor people get medical care. You’re free to believe that health care should be for the rich and not the poor, but I disagree. Because I don’t want to live in that sort of civilization. And I don’t think that sort of civilization is stable. I think if we continue to widen the gap between rich and poor — the rich get new hearts while the poor can go f— themselves — I think the poor will eventually handle the matter in a less than civilized fashion.
That’s the limit on analysis by numbers alone. We live in a democracy and the people will not long tolerate a system where their children die of diseases that are shrugged off by the children of the rich.
Is that happening now? Only a little. But in the libertarian utopia it would be happening a lot more. And assuming we still had universal suffrage (not to mention gun rights) the people would set about remedying the situation.
If we’re building a civilization — and I think we are — then we have to look to the long term health of same. That means a degree of justice. It means a moderation of extremes of wealth and power. It means some people will give up a little so that what we all have here together, this civilization, can go on. Yes, it also means we can’t go on spending what we don’t have.
As for numbers. Were you not one of the many people assuring me — according to incontrovertible numbers — that the dollar would be worthless by now? That the Chinese would stop lending to us? And what was your position on executive pay, because we just had a report out — somehow missed by many numbers guys — that showed 85% retention at AIG and GM and all those other “socialist” companies where salaries have been cut.
I also listened to many, many confident predictions that the Reagan tax cuts would somehow balance the budget (nope) and that the Clinton tax increases would destroy the economy (nope) and I don’t seem to recall any of you screaming three or four years ago that the entire economy was on the edge of a cliff and about to go plunging into meltdown.
If you could point out the place where 2 or 3 years ago you knew that AIG was a house of cards, or that Lehman was playing a shell game, or where you attacked derivatives, then I’d hold your prophetic abilities in greater esteem.
But the prophetic abilities of numbers guys are somewhat diminished given that almost to a man they managed to miss the financial equivalent of World War 2. You’re the boys who didn’t cry wolf.
I respect people who deal in numbers. They know a lot. But they suck at predicting the future.
And if I were inclined to read Tarot cards from numbers guys the numbers guys at the stock exchanges reacted to HCR with a big yawn, and a modest increase. Those guys are betting actual money. You guys are writing in comments. Whose numbers do you think carry more weight?
Dave:
Aren’t you making assumptions as well? In this case the assumption that future Congresses won’t keep the deal, or for that matter that they won’t improve on it?
A case: We use a pediatric service with two offices. Both were on paper records. They are moving to electronic. It saves us time — no need to fill things out twice, and we can have physical prescriptions moved to whatever office we happen to be nearest. The savings may or may not show up on their bottom line, but they definitely show up on mine.
Another case: I had to get some numbers from a previous doctor in a different state. Last time I did this they took two weeks: paper records. This time they read the numbers over the phone: electronic records. That was a savings for them and for me. And useful for my current doctor.
Not directly on-point but close: I had a back and forth with my doctor through a new confidential email service. Four communications, no cost to me or my insurer. (It essentially cut her compensation and passed the savings along.) The effect of this gratis communication will likely result in substituting a cheap test for a potentially expensive procedure. More savings, realized in this case because of the simple ease of access.
One other point on electronic records: in a rational world those records could be moved around by me. I move fairly often, and between the 4 of us we see one specialist or another at various times.
Each new office is another 20 minutes of filling out forms. I’d guess my wife and I spend 3 hours a year filling out medical forms. There’s no reason everything shouldn’t be on a swipe card or a flash drive or in an email account and instantly moved and updated. I get impatient filling out records and have no doubt made mistakes. So while I accept your statement that this hasn’t improved in the past, I think it may reach a tipping point.
steve,
The mandate is not iron clad, if you don’t buy insurance then you are merely fined, not forced to buy it.
And people who are young and healthy might opt to go with the fine. It really boils down to:
F vs. v – (c-s)
F is the fine, v is the value of having insurance (peace of mind, etc.) and (c-s) is the cost less any subsidy. If the left hand side is less than the right hand side, then take the fine. And good news! With this legislation, if you do get sick go get insurance at the same cost you would have paid before you get sick!
So it is quite possible that the legislation might percipitate insurance company death spirals. Not exactly a good way of handling the issue.
We’ve known for quite some time about the imbalance in Medicare. Yet politicians have done damn little about it. Are they suddenly going to find a reason too? I’m quite doubtful. So the initial savings we get are spent already, and future savings are at best described as being possible, not certain. So yes, I’m skeptical.
And political feasibility is great and all, but again, what is feasible does not have to be sufficient. That is the bottom line. You are basically saying, “Well, I hope past history is not indicative of the future and that politicians really will do the right thing in the future.”
Oh, and I do believe that the advisory board will not have cost setting powers. Their recommendations, I think, will have to be approved by Congress. Not exactly taking the issue out of the hands of Congress. It is not like how the setting of interest rates was given to the Fed. Oh, and look how swell that turned out. The two of the worst recessions in our countries history due to the Fed. Hmmmm…you still that enamored with the Advisory Board?
Michael….
This is particularly amusing coming from an a–hole enjoying a government sanctioned monopoly with virtually no oversite and who actually does smoke. Can you be anymore of a hypocrite? No, really that is a serious question? Please, tell us how I’m evil and you, the multimillionaire who enjoys his unearned profits from a monopoly, is better than me since I espouse a philosophy for promoting, basically, freedom.
How about this, you stop assuming you know what I think. I’ve already come out saying I think health care needs reforming. That subsidies is one way to go. I’ve made my position very clear multiple times on this site and OTB. I’m sick and tired of having to point out that this is really nothing more than a lie. That you are a liar. That you can’t engage me on my position so you have to make up a position and attack that. Its intellectually dishonest form a genius creative such as yourself.
[Aside: How oh I do love shoving your knows in that one repeatedly.]
No, I wasn’t predicting the recession we’ve had, but my outlook back in early 2007/late 2006 was negative over all (the posts are there on OTB). Job growth was anemic at best, and indicative of a recession for the most part. Economic growth was nothing to be impressed with. I figured a recession was coming at that time.
Look at that. First, I’m being chastised for not forecasting a very bad downturn in the economy, but when I point out that the outlook for a program like Medicare looks very bad…I’m to be ignored. Why can’t I think that even if I were to have accurately forecasted the financial crisis you’d have not believed me.
Could we have a break through in technology that makes the whole issue of Medicare go away? Sure, maybe in the next few years nano tech will have a huge break through and we’ll have a cheap way of producing many goods and improving our health. Inject a set of molecular machines that go in and fix the damage. Have molecular machine re-arrange the molecules in your old couch into a lovely new couch. Maybe the singularity will arrive and we wont turn the world into a ball of goo, and we’ll have cornucopia machines. Or probably not and we’ll be muddling along like we are now. But, here are some issues:
1. People are living longer.
2. We have the baby boomers.
1 & 2 imply that soon we’ll have more people on Medicare and Social Security than ever before and that current workers will have a very, very heavy burden. Unless something happens that results in dramatically higher growth, dramatically lower growth in health care costs, both, or the old people just start dying off in large batches rather suddenly we have a problem. Because that heavy burden could translate into lower economic growth…which hasn’t been particularly fantastic.
Your attitude in the past on this issue Michael as basically boiled down to: we’ll find the money. That strikes me as wishful thinking not unlike hoping for the arrival of the singularity just in time with its cornucopia machines.
Ha ha ha. Let me see, those same numbers guys were also betting real money that housing prices would go up and up and up. How did that work for them?
Oh, and BTW, I do happen to have investments, so I am betting with my money. And yes, I put a chunk of it into health care because I figure the next few years will be nice ones for health care at least in terms of places to invest.
“F vs. v – (c-s)
F is the fine, v is the value of having insurance (peace of mind, etc.) and (c-s) is the cost less any subsidy. If the left hand side is less than the right hand side, then take the fine. And good news! With this legislation, if you do get sick go get insurance at the same cost you would have paid before you get sick!”
1) The fines are adjustable.
2) Catastrophic insurance is available for those under 30, the ones most likely to opt for a fine. In my state, Pennsylvania, a 20-something can get catastrophic insurance with a $2500 deductible for about $1000 a year. I think it would make more sense to get catastrophic rather than pay a fine.
Steve
Verdon:
No, I earn my living from being really, really good at my job. In fact, in some ways, one of the best ever. As attested to by my editors, by my longevity in a very competitive business, by the damned-near superhuman breadth and volume of my work, by my peers, by reviewers, by the effect I’ve had on kids who now write me from college to say that my wife and I transformed their lives, and yes, by my earnings.
The government does prohibit you from stealing my work. Just as it keeps me from stealing your car. If I agree to let you steal my work can you tell me where I can pick up your car?
As for a monopoly, walk into your local Barnes and Noble, or click on Amazon. You’ll see thousands, tens of thousands of my competitors, many of whom are kicking my ass at the moment.
Then wander around the internet for a while and see how many hundreds of thousands of people are trying to take my job. Kidlit a monopoly? Even for you that’s dumb. The only monopoly I have is control over the work of my own mind and hands. I create the wealth. I’m sorry if that drives you to extremes of jealousy: go stand in the long, long line of people who wish they could do what I do. Waaah, DNA is a bitch. Me, I wish I could play Mozart like Yo Yo Ma, but I’m not enough of an ass to blame him for my own lack of talent.
Did I say you were evil? I don’t think you’re evil. I think you’re probably a guy with Aspergers, if I were guessing. And since I’m probably only about six inches further up the spectrum from you, I don’t see that as evil. Or even bad. I see it as tunnel vision, a limitation, not a moral matter per se.
And by the way, I never said I’m a multimillionaire — I should be, but I am amazingly bad at handling money. I have earned millions. I still earn a lot. But if it makes you feel any better I’m sure I’ll contrive a way to lose that as well. (Useful hint: don’t give it away to people. And don’t take the suite when a room will do.)
As for my regrettable habits — actually I gave up the stogies — I have not at any time asked for or suggested I be subsidized by you or anyone else. I have no reluctance to pay a fair price for health insurance. And believe me, you won’t be subsidizing me — at least not until I get old enough for Medicare. Nothing in the HCR in any way, shape or form involves a penny of Verdon money going to me. Not a penny. In fact, I expect the whole thing will end up costing me — a price I willingly (if unhappily) bear because I think it’s my duty to help those who cannot afford it.
But since you’ve been kind enough to laud my money-making capacity (if not my money-keeping) I’d point out that I have been subsidizing your defense, your roads, your environmental safeguards, your food quality and a host of other government services. You’re welcome!
Where is the contradiction there? A prophet’s reliability necessarily rests on his track record. If I’m to believe you can foretell the future I have to look to your past predictions. And if you manage to miss something the size of the Grand Canyon, I have a right to be reasonably skeptical.
Exactly. If investment bankers and all their well-informed, highly-educated, well-incentivized, drenched-in-research pals manage to completely misjudge the future, why in God’s name would I believe you can do better? Especially since you did no better than they did?
Verdon:
One more point which will undoubtedly drive you to still more seething and contempt and rage: you remind me of my son. He’s edging toward Aspergers as well, although we have hopes for him nevertheless.
He’s thus far incapable of seeing any interests beyond his own. He’s extremely intelligent — as you are. And he squeezes the entire world through a perspective as narrow as a straw. As I believe you do.
In his case the whole world is seen in terms of computer technology. “Good” is defined as efficient, fast, elegant and sleek. “Bad” is anything poorly coded, or cluttered, or of course anything that restricts his individual liberty (or uses an unfortunate font choice.)
I don’t think he’s evil, I just think he’s 13. But even if he never widens his perspective or gains empathy or imagination I won’t think he’s evil. I’ll just feel a little sorry for him.
steve verdon’s formula is good. I would just emphasize that for the working class, p=$695. Making the penalty progressive (which fairness no doubt dictates) means the incentives to forego insurance are greater, the less well off you are. The value of insurance is also less if you own less property.
In most areas where the government is trying to achieve compliance with some mandate, p must at least equal cost of compliance, otherwise it makes more sense not to comply.
A person is exempt from the penalty if the cheapest available policy exceeds 8% of income. So, for a person making median income ($40k), the threshold is $3,200. The average individual policy currently is $4,704. So, its quite possible, depending on whether you think insurance costs will increase or decrease, that p = 0 for most.
Michael,
In so many words, of course not. You wrote,
That is pretty insulting, and it implies an indifference to human suffering.
Then you wrote this,
Which of course, is a lie. Yeah sure, I’d like too, but I also realize that having a legal system, fire department, and such are good and likely to be severly under provided by the market. Parks are nice too, as are libraries, roads, national defense, and even air traffic controllers. So paying taxes for these public goods or subsidizing goods that have substantial external benefits is something I don’t mind. I think we’d have a vastly smaller government if we limited to goods in those catagories.
That is a poor analogy. If it was like the Grand Canyon, i.e. obvious, we wouldn’t be in the situation we are in now. And if you search my posts over at OTB you’ll find posts where I talk about the weakening economy (yeas back into 2006), the issue with sub-prime mortgages (to be fair, I actually linked to James Hamilton’s writings on that). I pointed to the soft labor market, etc. All the while taking alot of criticism for being too negative. At best I’m guilty of missing the size of the issue and the exact date, but as everyone knows, you can’t time the market. Things can last far longer than you can afford, or change far faster than you can anticipate.
But the problem is they also have incentives that can lead them to making bad decisions or overly risky ones. I’ve talked about it before, Dave has, so have others. For example, if you are pretty sure of a bailout…why not take on more risk than you otherwise would? And did I do no better? I still have a job, many of them don’t. I still have my 401k, yeah it took a hit, but it wasn’t wiped out. From where I’m sitting, I feel like I’ve done alright. Oh yeah, I didn’t keep refinancing my home either taking out more and more equity and end up underwater. I feel positively genius like…well until I got my taxes finished and realized I didn’t notice the change in the with holding tables and had to write some rather large checks…..
<blockquote.He’s edging toward Aspergers as well, although we have hopes for him nevertheless.
I don’t have aspergers (not even close), just because one is good with numbers does not imply aspergers. Having aspergers does often indicate strong ability in math. Its one of those all squares are rectangles, but not all rectangles are squares things.
I feel sorry for you for not being able to see things as they are vs. how you think they are.
I’m not opposed to current HCR legislation because of what it means simply for me, although that is part of it, but also because I think it is bad pretty much all around. Will more people get access to care? Yes. Is that good? Sure. That is about it as far as this legislation goes. I think it will be bad in terms of driving up costs faster thus making it more likely that we’ll have to reduce the amount of health care people get in the future. I think in the end it will drive up taxes, and not just on the rich or well to do.
Medicare is financed off of payroll taxes and is highly regressive. If costs are pushed up, then the working class and poor will likely feel the adverse effects of payroll tax hikes far more than me or Drew. More and more resources in both the public and private sectors will be diverted towards health care which means less things for education. Education is a good way to get out of poverty or avoid it. Don’t get married until you are 25, finish high school, don’t have a kid till you are married and have some sort of home and a decent job and one’s chances of ending up in poverty are very low.
In short, I’m a libertarian not because I want to keep what is mine. I’m a libertarian because I think the government does not reduce misery and redistribute income…I think it redistributes misery and reduces income. I want to get the government out of the way of people making themselves better off. And yes, that includes myself. As Stefan Sharkansky put it,
There proof positive I don’t have aspergers, ask your son if he’d mess up html tags like that?
Sheesh…preview function Dave! We need a preview function! :p
Steve Verdon:
I’m not quite sure why you and I have to despise each other.
I accept half the blame. I didn’t argue with your characterization of me as an asshole. I think you’re a bit Aspergery but I’ll grant that I’m a barely-reformed sociopath.
But I have the feeling that we are abusing Dave’s hospitality a bit. So may I suggest this: let’s shake hands virtually, let’s agree we don’t agree on a lot, let’s further agree that we are both difficult, arrogant, snide, rude, occasionally obnoxious people. Fair enough?
Then maybe we should both attempt a more formal, more 19th century kind of manners, but without the pistols at dawn thing.
Mr. Verdon:
One other point I should make. I engage you because I find you intelligent, knowledgeable and passionate.
You would be mistaken to believe that I devalue any of those attributes.
“steve verdon’s formula is good. I would just emphasize that for the working class, p=$695. Making the penalty progressive (which fairness no doubt dictates) means the incentives to forego insurance are greater, the less well off you are. The value of insurance is also less if you own less property.”
Yes, but it looks to me that at that point, they qualify for Medicaid.
Here, from Kaiser, is what the bill does. Notice the “greater”.
“Require U.S. citizens and legal residents to have qualifying health coverage. Those without coverage pay a tax penalty of the greater of $695 per year up to a maximum of three times that amount ($2,085) per family or 2.5% of household income. The penalty will be phased-in according to the following schedule: $95 in 2014, $325 in 2015, and $695 in 2016 for the flat fee or 1.0% of taxable income in 2014, 2.0% of taxable income in 2015, and 2.5% of taxable income in 2016.”
Steve
For a single person the penalty starts at $695, or it starts to go above that once you past $27,800/year. So a guy making $30,000/year with few assets would face a penalty of $750. It isn’t that much, granted not great income either, but not bad if you are 25 and relatively asset free. In 5 years that guy might want insurance what with pay raises and accumulation of various assets. But leading up to that he might, quite rationally, say forget it. If I do get sick, well I’ll get then.
So I can see an incentive problem here…possibly. Maybe there is something I’ve missed, but I can see some elements of the population not buying insurance.
Michael,
I think I’m getting choked up…
sniff…sniff
C’mon everyone, group hug…group hug. :p
Medicaid kicks in around $14k under the new law for individuals. So, it’s between about $14k and $41k that it’s going probably going to depend on subsidies, either through the government or employment. But in the individual market (looking at the tax credits at said Kaiser website), it looks to me like it will always be more expensive to pay for insurance than the penalty.
Which actually reduces Verdon’s formula to the perceived value of insurance. Insurance is about risk. People don’t buy insurance when they are working pay-check-to-paycheck; risk of future problems is an uncertainty that envelopes every decision. They put things off. The risk of getting expensively ill is an uncertainty in a given year, the bills are realities. Next year, we’ll do it right.
I’m thinking the mandate is probably too weak to be effective; the politics and sympathies of those paying it make it untenable. I’m not offended by the mandate in principle, but the sequencing is awful — I think Obama campaigned on this point as well.
So the IRS goes and penalizes the stepkids, because they think they are invincible, where does the money go? I am willfully ingorant here. I can’t see a place that it goes. Does it go into the general ledger?
Can’t that be routed into a catastrophic care fund?
Steve:
Next: picnic.