The Moral Healthcare Blog – Page 36 – Healthcare, health policy, cognitive science. , and the path to Universal Healthcare..

Is the Fed responsible for health care premium increases? | The Incidental Economist

Is the Fed responsible for health care premium increases? | The Incidental Economist:

Health spending is obviously relevant to premiums, but many other factors affect premium growth too. What everyone wants to know is why employer-sponsored health insurance premiums jumped up so much this year. Since health care spending growth has been low — at near 1990s levels — we can rule that out as an explanation.

Moving on, let’s consider some other things. For what follows, I’ve been aided by Charles Roehrig and colleagues of the Altarum Institute, with whom I exchanged email on this topic. The title of this post is explained in the final entry of the following list (“The underwriting cycle”).

Besides total health spending, what else affects premiums?

Profits. Insurers have been reporting a big profits lately, which implies premiums growing faster than costs.

If you are interested in understanding why premiums have risen far out of proportion to actual health care costs, please go to the link. There are no certain reasons, but this post offers lots of interesting (and plausible) possibilities, including the one in the title: Insurers are so heavily invested in bonds, that the low returns have “forced” them to turn to out-sized premium increases to keep profits up where they like them.

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Daily Kos: An indecent proposal

Daily Kos: An indecent proposal:

That cut-up Grover Norquist suggest wealthy Americans like Warren Buffet contribute to the Federal government on an optional basis, and Hunter at DailyKos offers to accept the offer…

My proposal is that we make taxes for wealthy Americans and corporations entirely optional. That’s it. If a corporation wants to pay zero percent in taxes, they should be allowed to, and if they want to pay the full tax rate, that is also allowed. The same for wealthy Americans.

The only caveat is that non-contributing corporations and individuals will be barred from taking advantage of any government services. It is the perfect free-market-based opt-out: If you do not want to support the American infrastructure and population to the same extent that your fellow citizens do, you can simply decline to, and live your life as the libertarian god you have always longed to be. You will be free! You will be allowed to go Galt, or not go Galt, to whatever degree you wish; as a special bonus, we shall prevent you from becoming that most dreaded of figures, the parasite, since if you are not contributing to the benefit of society it only stands to reason you should not gain profit from it either.

For starters, companies that do not pay the going tax rate will be barred from shipping their products on American roads. They will be prevented from connecting to the American electric grid, or from using municipal water or sewer systems. Instead, they will have to provide these services on-site. The good news: They can feel free to pollute as much as they like, as long as no pollution crosses the boundaries of their property (above, below or horizontally) into the rest of America. That would be considered an act of war.

Wealthy Americans that opted out of paying the going tax rate would also, of course, be prohibited from using American roads. This would not be a problem for them, as they generally can afford airplanes or helicopters, which would be similarly fine so long as they did not use American airspace (sorry, but the FAA costs money too, you know). But they could certainly fly around the property, which might be a pleasant experience.

Then we must consider the issue of security. Fire and police protection would be right out, so there would be no particular incentive for poorer Americans not to loot their properties (wealthy Americans tend to have nicer things than the rest of us). The American elite might consider the approach taken by wealthy Mexican families, which is to install a high perimeter fence around the property with a heavily armed private guard service. This would be expensive and unsightly, but it would be up to each individual to decide, for themselves, what the appropriate free-market level of protection for their own property might be. My one tip would be to spend a good deal of time on that decision.

It goes without saying that non-contributing Americans, corporate or otherwise, would not have access to the courts. This should be fine with them, since we know that meddlesome lawsuits are the biggest non-tax-related threat to America today. There is the minor issue of no recourse, if armed mercenaries do manage to overpower your guards and make off with your antique commodes or whatever it is you rich people hoard these days: Again, though, think of the tax savings.

This is a nice echo of Elizabeth Warren’s comments on the arrogance of the John Galt wannabees.

UPDATE: I posted this to the comments section:

Don’t forget the socialism of WWII

Let me add another item to your great piece, Hunter, and to Elizabeth Warren’s recent speech: Did the fathers of any of these captains of industry go to college on the GI Bill?
See here:

Within the following 7 years, approximately 8 million veterans received educational benefits. Of that number, approximately 2,300,000 attended colleges and universities, 3,500,000 received school training, and 3,400,000 received on-the-job training. By 1951, this act had cost the government a total cost of approximately $14 billion.
The effects of increased enrollment to higher education were significant. Higher educational opportunities opened enrollment to a varied socioeconomic group than in the years past. Engineers and technicians needed for the technological economy were prepared from the ranks of returning veterans. Also, education served as a social safety valve that eased the traumas and tensions of adjustment from wartime to peace. For the American colleges and universities, the effects were transforming. In almost all institutions, classes were overcrowded. Institutions required more classrooms, laboratories, greater numbers of faculties, and more resources. House facilities became inadequate and new building programs were established. New vocational courses were also added. This new student population called for differential courses in advanced training in education, commerce, agriculture, mining, fisheries, and other vocational fields that were previously taught informally. Teaching staffs enlarged and summer and extension courses thrived. Further, the student population was no longer limited to those between 18-23. The veterans were eager to learn and had a greater sense of maturity, in comparison to the usual student stereotype. Finally, the idea that higher education was the privilege of a well-born elite was finally shattered.

And of course, it was continued after WW II: Continuation of the Bill

The original G.I. Bill of 1944 expired in 1956, but the concept of veteran compensation continued, with all subsequent legislation still referred to as G.I. bills. In 1952 Congress passed the Veterans’ Adjustment Act to compensate veterans of the Korean War (1950-1953). There were some minor differences between the World War II and Korean G.I. Bills, but the outcome was broadly similar. More than two million Korean War veterans used the G.I. Bill to go to college, and 1.5 million financed new homes. The G.I. Bill underwent a significant change in 1966, when Congress passed the Veterans Readjustment Benefits Act (VRBA) as part of President Lyndon B. Johnson’s Great Society slate of social programs. The VRBA removed the requirement of serving in combat to receive government benefits, and instead made G.I. Bill benefits available to anyone who served in the military, whether in wartime or peacetime. Since 1966 the G.I. Bill has undergone a series of modifications and adjustments, but the fundamental benefits subsidizing education and home ownership remain the same. The Montgomery G.I. Bill (MGIB), enacted by Congress in 1985, provides educational stipends to former members of the military who contribute a small portion of their pay during their time in the service. The Post 9/11 Veterans Assistance Act of 2008 (effective date August, 2009) substantially increased the amount of tuition and housing assistance, allows veterans to transfer benefits to their spouses and children, and provides tuition benefits for National Guard and Reserve members.

Medicaid funds allegedly misused: U of L doctors used $4.8 million in Medicaid money for bonuses, Shaughnessy says | The Courier-Journal | courier-journal.com

Medicaid funds allegedly misused: U of L doctors used $4.8 million in Medicaid money for bonuses, Shaughnessy says | The Courier-Journal | courier-journal.com:

Doctors at the University of Louisville medical school used about $4.8 million in state Medicaid funds to pay themselves “financial bonuses” — money that was supposed to be used for indigent care, state Sen. Tim Shaughnessy says.

And they used another $5.2 million for an electronic records system that would make U of L doctors eligible for additional bonuses from the federal government, according to new details of a controversial transaction that Shaughnessy said he recently obtained from Attorney General Jack Conway’s office.

A spokeswoman for Conway said Wednesday that the office determined only that the $4.8 million was compensation for U of L doctors. But Shaughnessy insisted that Conway’s staff described the money as “bonuses” at a recent meeting.

“I was shocked,’’ said Shaughnessy, a Louisville Democrat who was the first to publicly question a transfer of about $30 million in surplus health funds in 2008 and 2009 from Passport Health Plan to U of L, University Physicians Associates, or UPA, and others represented on Passport’s board.
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Under a settlement Conway announced in July, UPA will repay the state $9 million over five years. Other groups that received funds from Passport’s $30 million transfer agreed to repay the funds according to various schedules. They include U of L, University Medical Center and local hospitals that provided capital to start Passport.

But Shaughnessy said the repayment doesn’t address his basic concern — that U of L’s board wasn’t involved in major financial transactions involving groups with which it is affiliated, including Passport, UPA and the U of L medical center.

“There was no involvement of the U of L Board of Trustees,” Shaughnessy said. “How did these millions of dollars get allocated without any involvement of the board?”

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Heads Of Largest Children’s Hospitals Receive Big Salaries And Rich Benefits – Kaiser Health News

Heads Of Largest Children’s Hospitals Receive Big Salaries And Rich Benefits – Kaiser Health News:

The pay packages have continued to climb even as the economy has languished and millions of Americans struggle to pay their health care bills. For some, the generous compensation raises questions about the mission of children’s hospitals, which operate as tax-exempt charities.

“Hospital CEOs, including those at children’s hospitals, are among the most lavishly compensated executives in the nonprofit field,” said Daniel Borochoff, president of the American Institute of Philanthropy, a charity watchdog group based in Chicago.

“These seven-figure CEO pay packages make it hard for nonprofit hospitals to justify their tax-exempt status,” he added. “If hospital CEO compensation were more in line with other large nonprofits then there could be more funding for community benefits such as free or discounted health care or important medical research.”

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The Social Contract – NYTimes.com

The Social Contract – NYTimes.com:

According to new estimates by the nonpartisan Tax Policy Center, one-fourth of those with incomes of more than $1 million a year pay income and payroll tax of 12.6 percent of their income or less, putting their tax burden below that of many in the middle class.

Now, I know how the right will respond to these facts: with misleading statistics and dubious moral claims.

Go read the whole thing!

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A glimpse at the high pay for children’s hospital CEOs – Sacramento Living – Sacramento Food and Wine, Home, Health | Sacramento Bee

A glimpse at the high pay for children’s hospital CEOs – Sacramento Living – Sacramento Food and Wine, Home, Health | Sacramento Bee:

“Hospital CEOS, including those at children’s hospitals, are among the most lavishly compensated executives in the nonprofit field,” said Daniel Borochoff, president of the American Institute of Philanthropy, a charity watchdog group based in Chicago. “If hospital CEO compensation were more in line with other large nonprofits then there could be more funding for community benefits such as free or discounted health care or important medical research.”

In 2009, an advocacy group for nonprofit hospitals and other health care groups warned its members that the pay packages were coming under increasing scrutiny. “Boards would be wise to streamline their executive compensation programs to make them less tempting targets,” a report prepared for the Alliance for Advancing Nonprofit Health Care stated.

The report pointed to cars, bonuses, generous retirement payouts and country club memberships as likely to attract criticism. “Many nonprofit organizations have been pressing their luck by imitating patterns in the for-profit sector,” it noted.

That year, CEO compensation at the 25 largest independent children’s hospitals ranged from a high of nearly $6 million to a low of $686,125, records show.

In all, CEOs collected more than $38 million, including deferred income and supplemental retirement awards, for an average of $1.5 million each.

If you are interested in looking up data for your own hospital or for any non-profit, go to Guidestar at http://www2.guidestar.org/Home.aspx and search for the organization. When you have found it, go to the Form 990 section (you will have to register – it’s free). Then you will have to look for either page 7, which is where the data may be, or go to an appendix/attachment at the end. Happy hunting.
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NJ Spotlight | Filling in the Details of NJ’s Health Insurance Exchange

NJ Spotlight | Filling in the Details of NJ’s Health Insurance Exchange:

“In Massachusetts, officials have tailored the requirements for participating insurance companies to ensure a certain high level of benefits; in Utah, the exchange is open to most of the companies that wish to do business in the state. The website for the Massachusetts exchange includes tools to help consumers select the best product, and the signup process takes less than ten minutes, researchers found. Utah’s exchange is more of an online portal, linking customers to existing insurance products, and the state has received a number of complaints about the complexity of the enrollment process.

“According to the Georgetown report, ‘you get what you pay for.’ Massachusetts’ exchange has a $30 million annual budget and 46 full-time workers, whereas Utah spends $600,000 and employs two staff members. With greater resources and outreach, Massachusetts has reached some 220,000 people, compared with 2,200 now in Utah’s program. According to 2009 data, after a few years with the exchanges in operation, Massachusetts had insured more than 95 percent of its residents and Utah had about 85 percent covered, when including those who obtain insurance through their jobs or the private market.

“The healthcare coalition in New Jersey did not focus on any single state in developing its list of principles, Snedden said, but worked with members to determine what was most critical here. The group also plans to launch a public campaign this summer to help individuals and business owners become more familiar with the concept of the exchange.

“‘What we’re doing is getting the conversation started,’ Snedden said. ‘We want to make ‘exchanges’ a word that actually rings a bell.'”

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