by Jennifer Haberkorn, Politico

Part of the health care overhaul due to kick in this September could strip more than 1 million people of their insurance coverage, violating a key goal of President Barack Obama’s reforms.

Under the provision, insurance companies will no longer be able to apply broad annual caps on the amount of money they pay out on health policies. Employer groups say the ban could essentially wipe out a niche insurance market that many part-time workers and retail and restaurant employees have come to rely on.

This market’s limited-benefit plans, also called mini-med plans, are priced low because they can, among other things, restrict the number of covered doctor visits or impose a maximum on insurance payouts in a year. The plans are commonly offered by retail or restaurant companies to low-wage workers who cannot afford more expensive, comprehensive coverage.

Depending on how strictly the administration implements the provision, the ban could in effect outlaw the plans or make them so restrictive that insurance companies would raise rates to the point they become unaffordable.

Read the rest at this link.

by Timothy P. Carney, Washington Examiner

As they whip for the health care bill, Democratic leaders pack a mean one-two punch of populist rhetoric and the hefty financial backing of the drug industry.

In the heated yearlong health fight, President Obama has often accused his opponents of willful misrepresentation, even as he and his allies have endlessly repeated the biggest whopper of all — that the bill would rein in the special interests.

The Obama team regularly dismisses opponents as industry lackeys. The Democratic National Committee blasted out e-mails this week warning that “for every member of Congress, there are eight anti-reform lobbyists swarming Capitol Hill” and “Congress is under attack from insurance lobbyists.”

But drug industry lobbyists, according to Politico, spent the weekend “huddled with Democratic staffers” who needed the drug lobby to “sign off” on proposals before moving ahead. Meanwhile, we learn that the drug lobby is buying millions of dollars of ads in 43 districts where a Democratic candidate stands to suffer for supporting the bill. The doctors’ lobby and the hospitals’ lobby are also on board with the Senate bill.

So the battle at this point is not reformers versus industry, as Obama would have you believe. Rather, it is a battle between most of the health care industry and the insurance companies.

(And the insurers are not opposed to the whole package. On the bill’s central planks — limits on price discrimination, outlawing exclusions for pre-existing conditions, a mandate that employers insure their workers and a mandate that everyone hold insurance — insurers are on board. They object mostly that the penalty is too small for violating the individual mandate.)

Pharmaceuticals are a far more entrenched special interest than the insurers.

Of all the single-industry lobbies in Washington, the largest is the Pharmaceutical Researchers and Manufacturers of America. PhRMA spent $26.2 million on lobbying last year — that’s nearly three times as much as the insurance lobby, America’s Health Insurance Plans, which spent $8.9 million.

If you include individual companies’ lobbying, pharmaceuticals blow away the competition, beating all other industries by 50 percent, according to data at the Center for Responsive Politics.

Given this Big Pharma clout, it’s unsurprising that the bill Obama’s whipping for — Senate bill — has nearly everything the drug companies wanted: prohibiting reimportation of drugs, preserving Medicare’s overpayment for drugs, lengthy exclusivity for biotech drugs, a mandate that states subsidize drugs under Medicaid, hundreds of billions in subsidies for drugs, and more.

PhRMA chief Billy Tauzin, who was vilified by Obama on the campaign trail, worked out much of this sweetheart deal in a West Wing meeting with White House Chief of Staff Rahm Emanuel. Tauzin visited the White House at least 11 times. He left his imprint so deeply on the current bill that it should probably be called BillyCare rather than ObamaCare.

Recall that pharmaceutical executives and political action committees dug deep trying to save the flailing candidacy of Democrat Martha Coakley in Massachusetts — a race that was explicitly a referendum on health care. She took in more than 10 times as much drug company cash as Republican Scott Brown.

This week, PhRMA, through a front group called Americans for Stable Quality Care, is rolling out millions of dollars in advertisements for the Democrats’ jury-rigged package consisting of the BillyCare bill and some as-yet-undetermined “budget reconciliation” measure. The ads reportedly will target wavering Democrats.

But supporters of BillyCare will continue to attack opponents as shills for insurance companies, demonizing, as Obama puts it, “those who profit from the status quo.”

Let’s look at those profits. Drug makers’ combined profit margin last year was 22.2 percent, compared with insurers’ 4.4 percent. Drug maker Merck’s net income, $12.9 billion, exceeds that of the 10 largest insurers combined.

Pfizer, which netted $8.64 billion last year, gave its CEO, Jeff Kindler, a 12.5 percent salary increase, bringing his compensation to $14.9 million. Pfizer, in a federal filing, attributed the raise partly to Kindler’s work “developing and advancing U.S. and global public policies that serve the overall interests of our Company,” including his “constructive participation in the U.S. legislative process.” Kindler contributed the maximum to Obama’s election, and Obama raised more money from the drug industry than any candidate in history.

On this bill, Republicans side with insurers, and Democrats mostly side with the richer and more powerful drug makers. The difference: Republicans didn’t cut a backroom deal with the insurers. Obama will still play the populist card, even as the drug lobby is his ace in the hole.

Read the rest at this link.

by Sheldon Richman

If the politicians who are bent on redesigning the medical and medical-insurance industries really wanted only to curb rising prices and help the uninsured get coverage, they would have zeroed in on the previous government interventions that created those problems. Instead, they are pushing grand schemes to turn our medical decision-making over to bureaucrats. That indicates that the so-called reform campaign is about power.

Medical care is too expensive. Prices for services rise faster than other prices, and there’s reason to believe much of the money is wasted. Expensive medical care equates to expensive insurance, which prices some people out of the market.

This has been called a failure of the free market, but that can’t be: There is no free market. I defy the advocates of government control to name one aspect of medicine or insurance that government doesn’t dominate.

The anti-market system politicians have put in place — as pleasing as it is for the insurance and pharmaceutical industries and organized medicine — harms the public. Yet it would be easy for them to remove the harmful interventions.

For example, they could end the adverse tax treatment of people who buy their own insurance. If your employer buys insurance for you, it’s paid for with pretax dollars. If you buy your own, you pay with after-tax dollars. That’s a hefty penalty. But the price of avoiding that penalty is high: You must cede control over thousands of dollars in cash wages as well as your medical coverage to your employer. You can’t tailor coverage to your own needs. To get a better plan you have to change jobs. That’s just stupid.

The system creates the incentive to overspend on medical services. Since insurance premiums appear to be paid by your employer and since the policy covers routine elective services and tests, you have no reason to shop wisely in the medical marketplace. That’s one reason for the price inflation. Why ask about the price or the necessity of a test if someone else seems to be footing the bill? Doctors know that and will err on the side of more rather than fewer services.

If the politicians really cared about high prices and lack of choice, they would remove the tax penalty. Do those in power even talk about it? No.

State governments make a bad system worse by mandating that “basic” policies cover many services for which most people would not buy insurance if they were explicitly paying the bill, such as acupuncture, hair transplants, contraceptives, and more. These mandates are state-granted privileges for the providers, who would rather lobby for their profits than have to attract willing customers. Every mandate raises the price of insurance and pushes young and low-income people out of the market. Without those mandates, many people would buy low-priced, high-deductible catastrophic insurance. Government creates many of those uninsured the politicians cry their crocodile tears over.

If politicians really cared about high costs and lack of choice, they would neutralize coverage mandates by removing the federal ban on interstate insurance sales. Then a resident of a high-mandate state, such as California, could buy a policy offered in a low-mandate, such as Arizona.

The government forces prices higher in many other ways. Medicare, for example, gives a virtual blank check to its beneficiaries, who have no reason to be cost-conscious about the services they buy. Retirees have gotten far more in benefits than they ever paid in taxes while working. As long as Medicare exists, everyone’s medical services will be artificially expensive. Medicare is doubly offensive: The money is taken from current workers, and when it is spent it bids up the price of medical services for those workers. Considering its $37 trillion unfunded liability, Medicare is the disaster some people predicted when it was set up in 1965. As long as it exists the medical system will be awry and government will exert control.

Government also raises medical prices by sponsoring a protectionist medical guild in each state, keeping the number of doctors low and prices and incomes high. Occupational licensing is a conspiracy against the public masquerading as consumer protection.

Yes, we suffer from monopoly and high prices. Government is the reason.

I received this in an email and thought you would enjoy it.  Great points made on this van, whether it’s legitimate or Photoshop work doesn’t matter.

by Betsy McCaughey, WSJ

The health bill that House Speaker Nancy Pelosi is bringing to a vote (H.R. 3962) is 1,990 pages. Here are some of the details you need to know.

What the government will require you to do:

• Sec. 202 (p. 91-92) of the bill requires you to enroll in a “qualified plan.” If you get your insurance at work, your employer will have a “grace period” to switch you to a “qualified plan,” meaning a plan designed by the Secretary of Health and Human Services. If you buy your own insurance, there’s no grace period. You’ll have to enroll in a qualified plan as soon as any term in your contract changes, such as the co-pay, deductible or benefit.

• Sec. 224 (p. 118) provides that 18 months after the bill becomes law, the Secretary of Health and Human Services will decide what a “qualified plan” covers and how much you’ll be legally required to pay for it. That’s like a banker telling you to sign the loan agreement now, then filling in the interest rate and repayment terms 18 months later.

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Associated Press

Protestors wave signs in front of the Capitol on Thursday.

On Nov. 2, the Congressional Budget Office estimated what the plans will likely cost. An individual earning $44,000 before taxes who purchases his own insurance will have to pay a $5,300 premium and an estimated $2,000 in out-of-pocket expenses, for a total of $7,300 a year, which is 17% of his pre-tax income. A family earning $102,100 a year before taxes will have to pay a $15,000 premium plus an estimated $5,300 out-of-pocket, for a $20,300 total, or 20% of its pre-tax income. Individuals and families earning less than these amounts will be eligible for subsidies paid directly to their insurer.

• Sec. 303 (pp. 167-168) makes it clear that, although the “qualified plan” is not yet designed, it will be of the “one size fits all” variety. The bill claims to offer choice—basic, enhanced and premium levels—but the benefits are the same. Only the co-pays and deductibles differ. You will have to enroll in the same plan, whether the government is paying for it or you and your employer are footing the bill.

• Sec. 59b (pp. 297-299) says that when you file your taxes, you must include proof that you are in a qualified plan. If not, you will be fined thousands of dollars. Illegal immigrants are exempt from this requirement.

• Sec. 412 (p. 272) says that employers must provide a “qualified plan” for their employees and pay 72.5% of the cost, and a smaller share of family coverage, or incur an 8% payroll tax. Small businesses, with payrolls from $500,000 to $750,000, are fined less.

Eviscerating Medicare:

In addition to reducing future Medicare funding by an estimated $500 billion, the bill fundamentally changes how Medicare pays doctors and hospitals, permitting the government to dictate treatment decisions.

• Sec. 1302 (pp. 672-692) moves Medicare from a fee-for-service payment system, in which patients choose which doctors to see and doctors are paid for each service they provide, toward what’s called a “medical home.”

The medical home is this decade’s version of HMO-restrictions on care. A primary-care provider manages access to costly specialists and diagnostic tests for a flat monthly fee. The bill specifies that patients may have to settle for a nurse practitioner rather than a physician as the primary-care provider. Medical homes begin with demonstration projects, but the HHS secretary is authorized to “disseminate this approach rapidly on a national basis.”

A December 2008 Congressional Budget Office report noted that “medical homes” were likely to resemble the unpopular gatekeepers of 20 years ago if cost control was a priority.

• Sec. 1114 (pp. 391-393) replaces physicians with physician assistants in overseeing care for hospice patients.

• Secs. 1158-1160 (pp. 499-520) initiates programs to reduce payments for patient care to what it costs in the lowest cost regions of the country. This will reduce payments for care (and by implication the standard of care) for hospital patients in higher cost areas such as New York and Florida.

• Sec. 1161 (pp. 520-545) cuts payments to Medicare Advantage plans (used by 20% of seniors). Advantage plans have warned this will result in reductions in optional benefits such as vision and dental care.

• Sec. 1402 (p. 756) says that the results of comparative effectiveness research conducted by the government will be delivered to doctors electronically to guide their use of “medical items and services.”

Questionable Priorities:

While the bill will slash Medicare funding, it will also direct billions of dollars to numerous inner-city social work and diversity programs with vague standards of accountability.

• Sec. 399V (p. 1422) provides for grants to community “entities” with no required qualifications except having “documented community activity and experience with community healthcare workers” to “educate, guide, and provide experiential learning opportunities” aimed at drug abuse, poor nutrition, smoking and obesity. “Each community health worker program receiving funds under the grant will provide services in the cultural context most appropriate for the individual served by the program.”

These programs will “enhance the capacity of individuals to utilize health services and health related social services under Federal, State and local programs by assisting individuals in establishing eligibility . . . and in receiving services and other benefits” including transportation and translation services.

• Sec. 222 (p. 617) provides reimbursement for culturally and linguistically appropriate services. This program will train health-care workers to inform Medicare beneficiaries of their “right” to have an interpreter at all times and with no co-pays for language services.

• Secs. 2521 and 2533 (pp. 1379 and 1437) establishes racial and ethnic preferences in awarding grants for training nurses and creating secondary-school health science programs. For example, grants for nursing schools should “give preference to programs that provide for improving the diversity of new nurse graduates to reflect changes in the demographics of the patient population.” And secondary-school grants should go to schools “graduating students from disadvantaged backgrounds including racial and ethnic minorities.”

• Sec. 305 (p. 189) Provides for automatic Medicaid enrollment of newborns who do not otherwise have insurance.

For the text of the bill with page numbers, see www.defendyourhealthcare.us.

Ms. McCaughey is chairman of the Committee to Reduce Infection Deaths and a former Lt. Governor of New York state.