The Budget Battles: Prosperity for Whom?
If the House Republican budget blueprint released on Tuesday is the “path to prosperity” that its title claims, it is hard to imagine what ruin would look like.
The plan would condemn millions to the ranks of the uninsured, raise health costs for seniors and renege on the obligation to keep poor children fed. It envisions lower taxes for the wealthy than even George W. Bush imagined: a permanent extension for his tax cuts, plus large permanent estate-tax cuts, a new business tax cut and a lower top income tax rate for the richest taxpayers.
Compared to current projections, spending on government programs would be cut by $4.3 trillion over 10 years, while tax revenues would go down by $4.2 trillion. So spending would be eviscerated, mainly to make room for continued tax cuts.
The deficit would be smaller, but at an unacceptable cost. Health care would be hardest hit, followed by nonsecurity discretionary spending — the sliver of the budget that encompasses annually appropriated programs. Those include education, scientific research, environmental preservation, investor protection, disease control, food safety, federal law enforcement and other areas that bear directly on the quality of Americans’ daily lives. The proposed cuts in such programs are $923 billion deeper than President Obama called for in his 2012 budget, which pushed the edge of what is politically possible.
Another big cut — $715 billion over 10 years — comes from mandatory spending other than Social Security and the big health care programs, a category that includes food stamps and federal retirement.
The blueprint does not call for any specific changes to Social Security, but, without explanation, it assumes a reduction of $1 trillion over 10 years in the program’s surplus. That would weaken the program by hastening the insolvency of Social Security.
When he unveiled this plan, Paul Ryan, a Republican of Wisconsin and the chairman of the House Budget Committee, declared, “This isn’t a budget. This is a cause.”
There is much truth in that. The blueprint is not a serious deficit reduction exercise for many reasons, the most important of which is that serious deficit reduction requires everything to be on the table, including tax increases. The plan released at the end of last year by the Obama deficit commission was one-third tax increases and two-thirds spending cuts. President Obama’s budget calls for a mix of tax cuts and tax increases, among the latter, letting high-end Bush tax cuts expire at the end of 2012. The Republican plan calls only for tax simplification. It would get rid of loopholes and reduce rates in a way that would not raise overall revenues but would invariably cut the tax bill of wealthy taxpayers for whom lower rates are more valuable than assorted loopholes.
The deficit is a serious problem, but the Ryan plan is not a serious answer. With its tax cuts above all, and spending cuts no matter the consequences, it is a recipe for more loud talk about the deficit but no real action.
By: Editorial, The New York Times, April 5, 2011
Health Reform Act Already Saving Lives Of Many Americans
Is the health care reform law a good deal for Americans, or is it so badly flawed that Congress should repeal it? Now that the measure is one year old — President Obama signed the Patient Protection and Affordable Care Act to law on March 23, 2010 — I humbly suggest we attempt an unbiased assessment of what the law really means to us, and where we need to go from here.
To do that in a meaningful way, we must remind ourselves why reform was necessary in the first place. I believe the heated rhetoric we’ve been exposed to since the reform debate began has obscured the harsh realities of a health care system that failed to meet the needs of an ever-growing number of Americans.
Among them: seven-year-old Thomas Wilkes of Littleton, Colorado, who was born with severe hemophilia. You would never know it to meet Thomas because he looks and acts like any other little boy his age, but to stay alive, he needs expensive treatments that over time will cost hundreds of thousands of dollars. Thomas’s parents were terrified before the law was passed because the family’s health insurance policy had a $1 million lifetime cap. Thanks to a provision in the law that makes lifetime caps a thing of the past, they can sleep easier at night.
Another person who faced the real possibility of not being able to pay for needed medical care is Robin Beaton of Waxahachie, Texas. Her insurance company notified her the day before a scheduled mastectomy two years ago that it was canceling her coverage. Why? Because Robin had forgotten to note when she applied for insurance that she had previously been treated for acne.
So Beaton – who told her story to a congressional committee — was a victim not only of breast cancer but of “rescission,” a once-prevalent practice in the insurance industry. The congressional panel — the House Energy and Commerce Committee — discovered that just three insurers had rescinded the policies of 20,000 people over the course of a five-year period, confirming for lawmakers that the practice was widespread and growing. By rescinding those 20,000 policies, the three companies avoided paying for more than $300 million worth of medical care, much of it for critically ill people. Thanks to the Affordable Care Act, Beaton and the rest of us will no longer have to worry that our insurance policies will be canceled when we need them most because of innocent omissions on applications.
Reform Will End Common Insurance Company Abuses
That same congressional committee discovered during another investigation that the four largest U.S. insurance companies had refused to sell coverage to more than 600,000 people with pre-existing conditions over a three-year period. Thanks to the Affordable Care Act, insurers can no longer deny coverage to children with pre-existing conditions. The law will apply to all of us by 2014.
In addition, young people who have not been able to find jobs that offer health care benefits can now stay on their parents’ policies until they are 26. Young adults, many of whom haven’t been able to find jobs, or who work for firms that don’t provide coverage, comprise the largest portion of the nearly 51 million Americans who are uninsured.
The new law also eliminates copayments for preventive services and requires insurers to establish appeals procedures for denied coverage or claims. And the law has additionally begun to close the infamous “doughnut hole” in the Medicare prescription drug program. Medicare beneficiaries are also now getting better coverage for preventive care. And small-business owners who provide benefits to their employees are being helped by tax credits available for the first time.
Another important provision of the new law requires insurers to spend most of what we pay them in premiums on medical care. In 1993, insurers on average were spending 95 percent of our premiums paying medical claims. That average has dropped steadily ever since. In many cases, especially in the individual and small-group markets, insurers have been spending as little as 50 percent on medical care. The law requires insurers to spend at least 80 percent (85 percent in the large-group market) on health care services or quality improvement activities. Those that don’t will have to pay rebates to their policyholders.
Coming Phases of Reform Will Help Control Costs
Other helpful parts of the law will be phased in. By 2014, for example, states will have to set up health insurance exchanges, which should help control costs. Between 2000 and 2010, American families saw annual premiums increase 114 percent on average from $6,438 to $13,770, according to the Kaiser Family Foundation. While employers often still pay the lion’s share of health insurance premiums, workers are seeing their portion increase every year. During the last decade, worker contributions to health care premiums increased 147 percent. The exchanges, if implemented as Congress intended, should bring down the cost of premiums by fostering competition among insurers. The exchanges will also require insurers to provide data that will enable us to make apples-to-apples comparisons among various benefit plans.
Even after the law is fully implemented, there will be much to do. While an estimated 30 million Americans will be brought into coverage, more than 20 million others will still be uninsured. There’s also still work to be done on addressing the underlying costs of health care in the United States.
But the Affordable Care Act is a start. Let’s consider it just that — a start — and an important one on our shared journey toward a health care system that works better for all of us. If we stop to think for a moment about what needed to be fixed, about why the health care system in the world’s richest country was failing an ever-growing number of Americans, I believe we will want to continue the journey.
By: Wendel Potter, Op-Ed Columnist, Center for Media and Democracy, March 24, 2011
The Affordable Care Act, One Year Later
A year ago this week, Capitol Hill was full of noise as the House of Representatives debated, and then voted, on the Affordable Care Act. But one of the most vivid memories of that experience for me was an extended moment of silence.
It came very late on Sunday evening–after the floor speeches, the votes, and the press conferences had ended. The galleries had long since emptied and the Capitol building itself was virtually unoccupied, so that it was possible to walk the entire length of the building, on the ground floor hallway that stretches from the House all the way to the Senate, without hearing so much as a single conversation.
It felt more than silent. It felt peaceful and, yes, satisfying. A prolonged, difficult debate had finally ended. It was time to move on.
Except that we haven’t moved on. We are still having arguments about health care reform. In fact, we are still having the same arguments about health care reform. The Affordable Care Act is law of the land now, yes, but its critics are determined to change that. And while the prospects of repealing it legislatively remain relatively slim, the prospects of repealing at least part of it judicially seem far more realistic than they did in the spring of 2010.
So perhaps it is worth taking a step back, just for a moment, and remembering how we got to this point–why this debate started in the first place and why it led to the enactment of this law.
It’s really not that complicated. Around one-fifth of the non-elderly population, or somewhere in the neighborhood of 50 million people, have no health insurance. Many millions more have insurance with major gaps or limitations, leaving them at risk of financial or medical catastrophe. Notwithstanding legitimate debates over exactly how many people go bankrupt or suffer physical hardship because they can’t pay their medical bills, virtually nobody denies that the human toll is real and significant.
These problems are the product, in part, a dysfunctional health insurance system that evolved haphazardly during the 20th Century. They also the product of a medical system as inefficient as it is costly. The United States pays more–far, far more–for health care than any other developed nation. But the care does not seem to be better overall, to say nothing of the fact that it is patently less available.
The goal of reform was really two-fold: In the short term, to make sure everybody can afford to pay for medical bills without financial distress; it the long term, to make the health care system as a whole more efficient, so that it no longer applied such a crushing financial burden on society. A single-payer system, like the ones in France or Taiwan, would have accomplished this. So would a scheme that turned health insurance into a regulated utility, as the Dutch and Swiss governments have done.
Political compromises, dating back to the earliest days of the 2008 presidential campaign, left the U.S. with a second-best–or, more accurately, a third- or fourth-best solution. It bolsters two existing insurance arrangements: Employer-sponsored coverage for workers in most companies, Medicaid for the very poor. It creates a new, regulated marketplace–insurance “exchanges”–for everybody else. Then, through a combination of tax changes and alterations to Medicare, it tries to reengineer medical care itself, wringing out administrative waste and focusing resources on the treatments, and care styles, that provide the most bang for the buck.
It’s easy to find the flaws–and to figure out who’s responsible for them. Doctors, hospitals, drug manufacturers, and device makers fought changes in the delivery of medical care that might affect their incomes; unions lobbied against tax reforms designed to discourage overly generous insurance; everyday Americans resisted changes to plans they already had. All of this blunted the Affordable Care Act’s efforts at cost control, which explains why, ten years from now, the best projections suggest we’ll have spent roughly as much on health care–as a government and as a country–as we would have if the law never passed.
At the same time, political conservatives fought to limit the bill’s expanse, demanding that the new outlays not exceed a $1 trillion, give or take. They had extra power, thanks to the filibuster, and were able to make the demand stick. As a result, the expansion of insurance coverage–via Medicaid and subsidies for private insurance–will not begin until 2014. Even then, somewhere around 20 million people, or 8 percent of the total population, will remain uninsured. And for some of the insured, the coverage will remain meager.
But the law’s shortcomings should not tarnish its many virtues. Eight percent uninsured means 92 percent insured, or around 95 of residents here legally. Or, to put it another way, more than 30 million additional people will have health insurance because of this law. The coverage, if not always as generous as it should be, will be enough to keep many if not most of the newly insured out of bankruptcy–and it will be available to almost everybody, regardless of pre-existing condition or insurance status.
The cost picture is also encouraging. The official projections suggest that, as of 2021, government spending (and, apparently, the country’s total spending) on health care will not be rising as fast as it is now. This is the critical distinction, because it’s the long-term burden of health care that threatens to bankrupt us. Critics doubt that officials will enforce planned changes to health care financing, but today’s lawmakers have no way to force action by their counterparts in the future. All they can do is put laws on the books–and that’s what they have done.
Are there better alternatives? Of course. But the loudest critics of the law, from the right, don’t have them. For all of their screaming, they have yet to put forward a credible plan that can do as much, let alone more, for less money. Their plans, stripped of misleading rhetoric, generally involve covering far fewer people, dramatically reducing the coverage that people have, or some combination of the two. Their dispute is not with the means Democrats have used to make health care affordable to all. It’s with the goal itself.
No, the way to improve the law is to build upon it–to bolster the insurance coverage, reach those Americans the law as written will not reach, and to strengthen the experiments in cost control that work. The best analysis of the law remains the one Senator Tom Harkin gave: The Affordable Care Act is not a mansion. It’s a starter home. But it’s got a solid foundation, a sturdy roof, and room for expansion.
A year from now, the presidential campaign will be well underway and the debate about the Affordable Care Act will likely be, if anything, more acrimonious than it is now. But perhaps after the election and, hopefully, after 2014, the country really will move on.
By: Jonathan Cohn, The New Republic, March 23, 2022
Ineffective and Unfair: Conservatives Target Preventive Health Care for the Ax
It seems we’ve entered the season of shortsighted thinking. With 50.7 million uninsured Americans, Republicans are on a rampage to repeal the Affordable Care Act. Adding insult to injury, the most recent House Republican plan to cut the federal budget deficit this fiscal year took a scalpel to $10 billion in federal grants that provide health care to indigent women and children, slashing $2 billion in federal funding that is bound to have very expensive consequences.
Funding for community health centers will be cut in half by the Republican cuts. Sen. Orrin Hatch (R-UT), who was a co-sponsor of the legislation responding to President George W. Bush’s call to expand funding for these centers in 2008, says that “since 2001, additional funding has allowed health centers in more than 750 communities nationwide to provide care to about four million new patients. These centers provide affordable and quality care to at-risk Americans who otherwise might have to do without.”
He’s right on the mark. No health care costs will be avoided by cutting this $1 billion out of the budget because the absence of care doesn’t stop you from getting sick. It simply means you get sicker and you turn up at the emergency room or a hospital when your illness has progressed to the point that your care needs are exorbitantly expensive.
On top of this cut to care, which more often than not is the safety-net care for women and children, the proposals would also cut the maternal and child health block grant by 30 percent. This block grant pays for child immunizations and prenatal care for tens of thousands of women and children. It’s obvious that without access to immunizations more will have to be spent to care for kids sick with easily preventable illnesses.
And reducing access to prenatal care is both life-threatening and costly. A preemie baby’s health care costs are 10 times higher than a full-term, healthy-weight child, according to the March of Dimes. The organization estimates that the full lifetime health care costs for these fragile children hit the $17 billion mark. It’s simply penny wise and pound foolish to cut $199 million out of a program that has a proven track record of delivering health to babies and driving down America’s health care costs.
Among the programs slashed is one of the most efficient programs to improve child nutrition: the Women, Infants and Children program run by the Department of Agriculture. This program gives expectant mothers with very small children important tips on how to feed their children healthy meals. And it provides them with coupons to incentivize them to purchase the best foods for their children. Research shows that without this intervention the nutritional intake of these children would be higher in fats, salts, and sugars, according to a recent U.S. Food and Nutrition Services study.
Instead of spending $1,400 a month in extra medical care for an obese child, for just $41 per month this program shifts these young mothers and children into healthy eating patterns, says the Centers for Disease Control and Prevention. Clearly, the WIC approach is a useful and relatively cheap way to stem the rising tide of childhood obesity.
An unsurprising but equally shortsighted cut is the complete elimination of family-planning services. If you just listened to their sound bites, you would think these funds could be used for abortions. But we all know that’s not permitted. These federal funds make it possible for uninsured women and men to get access to critical contraceptive services, pregnancy counseling, and tests for sexually transmitted infections, cervical cancer screening, and other critical health screens. Without access to these health care services, the health care needs of these adults will not disappear.
Instead, these adults will end up with unintended pregnancies and preventable health conditions that could have been avoided had they had ready access to commonplace family-planning services and screenings. Indeed, every dollar spent on family-planning services saves taxpayers $4 in Medicaid-funded prenatal, delivery, and postpartum services alone, according to a recent study by the Guttmacher Institute.
The absurdity of these cuts to the block grant, community health care centers, and family-planning services is that none of this funding would be necessary if we had a fully functioning national health care system where every American had access to high-quality care.
Benjamin Franklin famously said, “An ounce of prevention is worth a pound of cure.” Millions more Americans will lose access to health care as a result of these cuts and as a result more will have to be spent to address the real health care consequences of these cuts. Franklin also invented bifocals so his aging colleagues could see the important documents they gathered to draft. Perhaps the Republican leadership needs to adjust their glasses so they more clearly see that $2 billion in cuts they propose to the health care services for poor women and children will cost the taxpayers billions more in unnecessary health care expenses.
By: Donna Cooper, Senior Fellow, Center for American Progress, February 10, 2011
Remember The Uninsured?
In February 2007, Deamonte Driver died of an infected tooth. But he didn’t really die of an infected tooth. He died because he didn’t have consistent insurance. If he’d had an Aetna card, a dentist would’ve removed the tooth earlier, and the bacteria that filled the abscess would never have spread to his brain.
Deamonte Driver was 12. His insurance status wasn’t his fault.
If all you knew about the Affordable Care Act was what you gleaned from watching the Republicans make their case against it, you probably would not know that the legislation means health-care coverage for more than 30 million Americans. Or, if you did know that, you’d be forgiven for not realizing it’s relevant: It almost never gets mentioned (see this congressman’s rundown of the bill’s contents, for instance), and the repeal legislation the Republicans are pushing does nothing to replace the coverage the Affordable Care Act would give to those people.
The lack of concern for how more than 30 million Americans will get their health-care coverage makes for an ugly contrast with the intense concern that Rep. Andy Harris — a proponent of repeal — found when he heard that his congressional health-care coverage wouldn’t begin until a month after he took the oath of office. “He stood up and asked the two ladies who were answering questions why it had to take so long, what he would do without 28 days of health care,” recalled one of the session’s attendees. He knows his taxpayer-subsidized insurance is important. But what about Driver’s?
We have a tendency to let the conversation over health-care reform become a bloodless, abstract discussion over cost curves and CBO models. We do that for two reasons: First, cost is important. Second, it’s important to the people who have political power, which is, by and large, not the same group who doesn’t have health-care insurance. Someone involved in the 2008 campaign once told me he’d seen numbers showing that 95 percent of Obama’s voters were insured. The numbers for McCain were, presumably, similarly high, or even higher. These are the people the political system is responsive too.
But that doesn’t make the plight of the uninsured any less wrenching. The Urban Institute estimated that 22,000 people died in 2006 because they didn’t have health-care insurance. John Ayanian, a professor of medicine and health-care policy at Harvard Medical School, testified before Congress on this issue. “Uninsured adults are 25 percent more likely to die prematurely than insured adults overall,” he said, “and with serious conditions such as heart disease, diabetes or cancer, their risk of premature death can be 40 to 50 percent higher.” And none of that takes into account the unnecessary suffering and physical damage that flourishes in the absence of effective medical care. Nor does it speak to the economic devastation that illness unleashes on uninsured families.
These numbers shouldn’t surprise us: We pay a lot of money for health-care insurance. We’ve directed the government to spend even more money subsidizing that insurance for the elderly, the disabled, some of the poor and everyone who gets health-care coverage through their employer. We value this product so highly for a reason: Most of us would agree that being able to afford to see a doctor isn’t a luxury. It’s a necessity. Rep. Harris certainly feels that way.
The same goes for the uninsured. In fact, it’s often more true for them, as many haven’t received reliable care for some time and have multiple health problems that haven’t been effectively treated. That’s why, when a temporary free clinic set up shop in Los Angeles, 3,000 people lined up for treatment. It’s why the famed RAND health insurance experiment found the people who benefited from insurance most clearly were the poor, as they were often plagued by easy-to-treat conditions like hypertension.
The Affordable Care Act covers the vast majority of the uninsured. It covers everyone who makes less than the poverty line, and almost everyone who makes less than 300 percent of the poverty line. It does all this while spending about 4 percent of what our health-care system currently spends in a year, and it offsets that spending — and more — to make sure the deficit doesn’t bear the burden of society’s compassion. Perhaps there’s a better way to achieve those goals that can pass Congress. If so, I’m open to hearing about it. But to repeal the bill without another solution for the Deamonte Drivers of the world? And to do it while barely mentioning them? We’re a better country than that. Or so I like to think.
By: Ezra Klein, The Washington Post, January 19, 2011
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