Sharp Rise In Premiums Exposes Health Insurers’ Greed
According to a study released today by the Kaiser Family Foundation, 2011 health insurance premiums for employer-sponsored family healthcare benefits rose 9 percent over last year’s prices, leaving employees to pay, on average, $4,129 and employer contributions at $10,944. The number represents a surprising rise given that increases experienced in 2010 were just 3 percent.
So, why the sudden increase?
We know that Americans are using fewer medical services since the economy took a dive as people are staying away from the doctor and putting off non-life saving surgeries, such as knee and hip replacements, until they have more confidence that they will have the money required to pay deductibles and co-pays. We also know that fewer medical services are being utilized as a result of the increased popularity of Health Safety Accounts which require deductibles in excess of $2,000 per family, and employer provided policies that have increasingly large deductibles and co-pays.
As a result, can it possibly make sense that medical costs are increasing by the 9 percent reflected in the hefty premium hikes? In a word, no.
That will not stop the anti-Obamacare forces, of course, from putting the blame squarely on healthcare reform. In a sense, I suppose the Affordable Care Act does bear some of the responsibility—if you can consider motivating the health insurers to falsely inflate their prices, by forcing them to do the right thing, to be a blamable offense.
Beginning next year, health insurers will be required to justify any increases in premium rates above 10 percent. They will further be obligated to refund money to customers if an insurer is found to have spent less than 85 percent of their premium income on medical expenses. Thus, it is hardly a stretch to conclude that the insurers are simply taking their last chance to raise premium rates before they find themselves having to be more accountable to the government, particularly when they are pretty much admitting to as much.
As noted by Reed Ableson in The New York Times:
Throughout this year, major health insurers have defended higher premiums—and higher profits—saying that their expenses would rise once the economy recovered and people believed they could again afford medical care. The struggling economy will probably keep suppressing demand for medical care, particularly as people pay a larger share of their own medical bills through higher deductibles and co-payments, according to benefits consultants and others. About three-quarters of workers now pay part of the bill when they go see a doctor, and nearly a third have a deductible of at least $1,000 if they have single coverage, up from just one in 10 in 2006, according Kaiser.
So, the insurance company defense is that they expect prices to rise sometime in the future (clearly an undefined period) and they want to be ready. Somehow, this justifies them to dramatically raise their premium prices now, at time when their costs are actually less and their profits are through the roof.
Not only is such behavior astoundingly predatory, the insurers are playing a major role in keeping the economy in the dumps, as it is precisely this sort of unnecessary premium increase that causes employers to avoid hiring more employees.
For those who believe that we should leave it to the free market to establish the prices in the medical system (of which insurance will always be a necessary part), maybe they can explain how the system is working in this instance? In a time where patient control has risen dramatically as consumers decide if and how they will—or will not—spend on medical services now that they have greatly increased responsibility for the familiy medical bills as a result of much higher deductibles, and at a moment where there are substantially reduced claims coming onto health insurers’ balance sheets due to diminished use of medical services, exactly what is the free market concept that justifies an insurance company raising their premium rates? What’s more, at a time when fewer people are using physician’s services, why would costs go up?
Free market principles would suggest that lower demand should produce lower prices. But that is clearly not what is happening.
I know what some of you are thinking—but before you say it’s all the government’s fault, I would hasten to point out that, with an apples-to-apples comparison, there are no substantial new regulations hitting physicians this year that did not exist last year. And before you blame the president’s health care reform program for the insurance companies’ usurious behavior, note that the two million young people who have been added to the insurance roles as a result of Obamacare’s permitting these people to stay on the family insurance policy, would not increase an insurance company’s costs by 9% over last year’s prices. Indeed, adding all of these healthy kids to the insurance pools should help insurers spread risk more effectively while collecting additional premium revenues.
The bottom line is that there is absolutely no justification whatsoever for the health insurance industry hitting employers with a 9 percent increase. It is a simple matter of greed and it is precisely that greed that has long made access to healthcare continuously more difficult for middle class Americans.
By: Rick Ungar, Mother Jones, September 27, 2011
Whose Baby Is She?: The Birthing Of Solyndra
Solyndra is trying to rival her big sister Katrina’s ability to make the federal government look incompetent. But whose baby is she?
Since the solar-energy company went belly-up a few weeks ago — leaving taxpayers on the hook for $535 million in loan guarantees — a business that was once the poster child for President Obama’s green-jobs initiative has instead become a tool for Republicans to discredit most everything the administration seeks to do.
Sen. Orrin Hatch of Utah used Solyndra to argue against worker-training benefits. Sen. Jim DeMint of South Carolina used it to argue that the federal government should stay out of autism research. Disaster relief, cancer treatments, you name it: Solyndra has been an argument against them.
And this week, the government faced the prospect of a shutdown because House Republicans added a provision to the spending bill to draw more attention to — what else? — Solyndra.
“Because of some of the horrible weather we have had over the past several weeks, we have all agreed to add emergency funds we didn’t originally plan in this bill, and Republicans have identified a couple of cuts,” explained Senate Minority Leader Mitch McConnell, including “a cut to a loan-guarantee program that gave us the Solyndra scandal.”
What McConnell neglected to mention is that Solyndra was cleared to participate in this loan-guarantee program by President George W. Bush’s administration. He also did not mention that the legislation creating the loan-guarantee program, approved by the Republican-controlled Congress in 2005, received yes votes from — wait for it — DeMint, Hatch and McConnell.
This doesn’t mean that Bush is to blame for Solyndra or that the Obama administration should be absolved. Obama, whose administration gave the company the loan guarantee, deserves the black eye that Republicans have given him over the half a billion dollars squandered on the company. But the Republican paternity of the program that birthed Solyndra suggests some skepticism is in order when many of those same Republicans use Solyndra as an example of all that is wrong with Obama’s governance.
“Loan guarantees aim to stimulate investment and commercialization of clean energy technologies to reduce our nation’s reliance on foreign sources of energy,” Bush’s energy secretary, Sam Bodman, announced in a press release on Oct. 4, 2007. The release said the Energy Department had received 143 pre-applications for the guarantees and narrowed the list down to 16 finalists — including Solyndra. Bodman said the action put “Americans one step closer to being able to use new and novel sources of energy on a mass scale to reduce emissions and allow for vigorous economic growth and increased energy security.”
Bush’s Energy Department apparently adjusted its regulations to make sure that Solyndra would be eligible for the guarantees. It hadn’t originally contemplated including the photovoltaic-panel manufacturing that Solyndra did but changed the regulation before it was finalized. The only project that benefited was Solyndra’s.
The loan-guarantee program for these alternative energy companies, in turn, was created as part of the Energy Policy Act of 2005 — sponsored by Rep. Joe Barton (R-Tex.), who has been a leader in the congressional probe of Solyndra’s ties to the Obama administration.
Among those in the Republican majority who supported the bill was Rep. Louie Gohmert (Tex.), who, in a trio of speeches on the House floor in recent days, has taken a rather different approach than the one in the legislation he supported.
On Sept. 13, he invoked “the Solyndra fiasco” and said we are “prioritizing green practices kind of like a bankrupt Spain has done.” On Sept. 15, he denounced Obama’s new jobs proposals because “green programs, like Solyndra, will have priority.” On Sept. 23, he complained: “Apparently, half a billion dollars squandered for crony capitalism was not enough. There’s more provisions for that in the president’s so-called jobs bill.”
Also supporting the legislation creating the loan-guarantee program was Rep. David Dreier (R-Calif.), who on Sept. 22 said on the House floor that Republicans were removing $100 million from the loan-guarantee program “to ensure that we never again have another boondoggle like Solyndra.”
The complaints were much the same in the Senate, where DeMint said the Solyndra case exposed the “unintended results when our government tries to pick winners and losers.” That’s a valid criticism, but it would be more valid if DeMint hadn’t been a supporter of the loan-guarantee legislation in 2005.
But that was before Obama’s presidency, and views back then were different. They were more like the March 2008 press release from Bush’s Energy Department, announcing that it was funding research projects on photovoltaic technology. “These projects are integral to President Bush’s Solar America Initiative, which aims to make solar energy cost-competitive with conventional forms of electricity by 2015,” the announcement said.
Among the winners listed in the press release? Solyndra.
By: Dana Milbank, Opinion Writer, The Washington Post, September 26, 2011
The Republican’s Imaginary Class War
Suppose they threw a class war and nobody came?
The Republican Party is up in arms this week in response to President Obama’s proposal to help close the deficit by requiring the wealthiest Americans to pay their fair share of taxes. Specifically, the president has proposed the “Buffett Rule,” named for billionaire Warren Buffett, which would ensure that millionaires pay as fair a share in income tax as do all working Americans. In response, GOP budget guru Rep. Paul Ryan resurrected one of his party’s favorite talking points, calling the proposal “class warfare.” Others have been following his rhetorical lead. In last night’s GOP debate in Florida, Mitt Romney asserted that “the president’s party wants to take from some people and give to others” and Newt Gingrich insisted that people on unemployment insurance are getting paid “for doing nothing.” Republican leaders seem to be preparing for an all-out assault from low-and-middle income Americans whom they bizarrely believe are intent on stealing their cash.
The Republicans’ “class warfare” accusation is both ironic and cynical.
It’s ironic because, in the midst of the current economic and jobs crisis, where a huge number of Americans are desperately hurting — with homes underwater, with unemployment insurance running out and health insurance gone, with kids in over-crowded classrooms in buildings that are decaying — the rich are getting richer and large corporations are sitting on record profits. Income inequality in the U.S. is at its highest since the precarious days of the late 1920s. One third of Americans who were raised in middle class households can fall out of the middle class as adults. A political elite beholden to the wealthiest CEOs has pursued policies that take money out of the pockets of the neediest to create ever-larger tax breaks for the wealthy. The richest one percent of Americans now earn almost a quarter of the country’s income and control 40 percent of its wealth — a level of inequality not seen since the days before Social Security and Medicare and the social safety net as we know it. If there is “warfare” going on between the “haves” and the “have nots” it’s pretty clear who is waging war on whom.
Even more, this claim of “class warfare” that Republicans are touting is something quite dangerous. It’s an expression of a deeply cynical vision of our country, in which everyone is out for themselves, the suffering of the least fortunate is of no consequence to the most fortunate, and the American dream is off-limits to those who have lost their footing in a devastating economy. Fortunately, this is a vision that most people wholeheartedly reject. The task of our elected officials is to stop assuming the worst about their constituents’ insensitivity to the plight of their fellow Americans, to stop trying to pit us against each other and to start working toward an economic policy that works for everyone. Struggling Americans don’t want to take the American dream away from those who have achieved it and successful Americans don’t want to see their fellow citizens slip into permanent poverty.
The “class warfare” Republicans decry is all in the heads — and the destructive policies — of a small number of political leaders. While all but a few Republicans in Congress have signed a pledge to never raise taxes on corporations or the wealthy, the majority of Americans are much more pragmatic. According to a recent New York Times/CBS News poll, a whopping 71 percent of Americans — including 86 percent of moderates and 74 percent of independents — think that any plan to reduce the deficit should include both spending cuts and tax increases. 56 percent, including large majorities of moderates and independents said that wealthier Americans should pitch in and pay higher taxes to help reduce the deficit. A Gallup poll this week found that 53 percent of Republicans and Republican-leaners support the president’s plan to eliminate corporate tax loopholes (a major element of the alleged “class warfare”), and majorities of GOP respondents supported spending that extra revenue on hiring public employees, funding public works projects and cutting payroll taxes on small businesses.
The Republicans’ invocation of “class warfare” is a political ploy that the vast majority of Americans want no part of. Warren Buffett is not alone.
By: Michael B. Keegan, Huffington Post, September 23, 2011
Desperately Seeking A Candidate: Republicans Falling In And Out Of Love
Here’s my question for the Republican Party: How’s that Rick Perry stuff workin’ out for ya?
You’ll recall that Sarah Palin asked a similar question last year about President Obama’s “ hopey-changey stuff.” Indeed, hopey-changey has been through a bad patch. But now the GOP is still desperately seeking a presidential candidate it can love. Or even like.
That Perry was crushed by Herman Cain — yes, I said Herman Cain — in the Florida straw poll Saturday confirms that the tough-talking Texas governor’s campaign is in serious trouble. He’s the one who put it there with a performance in last week’s debate that was at times disjointed, at times disastrous.
Perry was supposed to be the “Shane”-like Western hero who brought peace to the troubled valley that is the Republican presidential field. A month after he rode into town, however, increasingly frantic GOP insiders are begging New Jersey Gov. Chris Christie to saddle up and save the day.
After watching Perry in the debate, Weekly Standard editor Bill Kristol — a card-carrying member of the Republican establishment — had a one-word reaction: “Yikes.”
Perry got off to what his supporters consider a strong start, which means he spoke in complete sentences. After the first hour, however, he began to slip into gibberish — as when he said his program for controlling the border with Mexico without building a fence includes putting “the aviation assets on the ground,” and when he described the nation between Afghanistan and India as “the Pakistani country.”
Then he wound up for his big attack on Mitt Romney as a flip-flopper. This is what came out:
“I think Americans just don’t know sometimes which Mitt Romney they’re dealing with. Is it the Mitt Romney that was on the side of — against the Second Amendment before he was for the Second Amendment? Was it — was before — he was before the social programs from the standpoint of — he was for standing up for Roe versus Wade before he was against Roe versus Wade? Him — he was for Race to the Top. He’s for Obamacare and now he’s against it. I mean, we’ll wait until tomorrow and — and — and see which Mitt Romney we’re really talking to tonight.”
Yikes, yikes and double yikes.
The prospect of Perry standing next to Obama on a debate stage may have freaked out the GOP establishment, but what angered the party’s base was Perry’s position on illegal immigration. It is both reasonable and compassionate, meaning it is also completely unacceptable.
At issue was Perry’s initiative to let the sons and daughters of illegal immigrants in Texas pay in-state tuition at state universities. “If you say that we should not educate children who have come into our state for no other reason than they’ve been brought there by no fault of their own, I don’t think you have a heart,” Perry said.
Two days later, in the straw poll, Florida Republicans showed him just how heartless they can be.
I don’t know anyone who believes that Cain’s big victory — he captured 37 percent of the vote, compared with Perry’s 15 percent and Romney’s 14 percent — is a sign that the Hermanator’s campaign is about to catch fire, except perhaps Cain himself. Instead, it was a vote of no confidence in what still looks like a strikingly weak field.
Michele Bachmann swiftly rose and fell in the polls. If Perry traces the same arc, the temptation would be to conclude that the party has resigned itself to Romney and is ready to fall in line. But Romney has been running for nearly five years now and still hasn’t overcome an uncomfortable truth: The party’s just not that into him.
At this point, you have to wonder if the GOP will fall in love with anybody. I’m trying to imagine the candidate who can maintain credibility with the party’s establishment and Tea Party wings. If the ultra-flexible Romney isn’t enough of a political contortionist to do it, who is?
Given the state of the economy, Obama’s going to have a tough re-election fight no matter what. But while the president flies around the country knitting the Democratic Party’s various constituencies back together, Republicans are still waiting for Mr. or Ms. Right to ride over the horizon.
I don’t know if Christie can ride a horse, but this movie’s not over yet.
By: Eugene Robinson, Opinion Writer, The Washington Post, September 26, 2011
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