This is the third of a series of commentaries examining the state of health-care including the serious problems with health-care delivery, the underlying root causes of those problems, the looming government fiscal catastrophe secondary to health-care entitlement spending, the failure of the recently passed health-care “reform” to address the grave problems facing our nation related to health-care delivery, the harm the recently passed health-care “reform” will cause to our seriously ill economy; and a proposal for a framework to truly, effectively, and sustainably reform our health-care delivery system. This report beigns the discussion on the underlying cost drivers of our health-care system.
The author feels obligated to disclose underlying bias: 1. this analysis reflects the author’s strong belief in the efficiencies and fairness of truly free markets as well in the individual’s right and responsibility of self-determination and of self-reliance. 2. I have 3 daughters, 3 nieces, and 9 nephews who deserve their opportunity to live the American Dream – a dream made possible by the protection of our unalienable rights endowed by our Creator
Health-Care Costs Drivers – Most Advanced Care and Superior Access to Care
Recognizing that true legitimate health-care reform must first control costs, we must then first understand the reasons for the accelerating health-care cost growth in order to develop effective policy solutions. There are several significant drivers underlying this growth. First, our American society values good health and, thanks to our free market economy, has the economic luxury to spend a significant portion of our GDP in the pursuit of better health. We have the most responsive health-care system of any nation in this world. We not only have rapid access to care for serious and life threatening illnesses but also for painful conditions and conditions that restrict the quality of our lives. For example, a young woman, who loves to run, tears her knee cartilage and is unable to run –not a dangerous or even a severely disabling problem but rather a quality of life issue. She likely can be seen by an orthopaedist, have an MRI done, and have surgery all within a couple of weeks. In contrast, that same scenario in Canada or England would take a year or more (MRI wait times alone can take 2 to 4 months). Obviously, rapid access to health-care makes our health-care expenditures greater but most of us believe such access is a key component to making our system the most responsive in the world and is worth the expense.
Our pursuit of good health has also lead to significant investment of resources to develop unprecedented medical care and technological advances. Private sector US medical companies have been at the forefront of medical care progress. These innovations have improved the quality of our lives and extended the lives of our citizens as well as those of other countries. The development of drugs to combat AIDS is one such life changing example. Although significantly contributing to health-care cost, these technological advances have been worth every penny. Moving forward with the health-care our country urgently requires, reform must control unsustainable cost growth, but must not and does not have to ration or decrease our access to heath-care. Reform must not discourage further progress and innovation in health-care. And reform must not discourage the best and brightest from going into health-care.
The next Dr Right installment will examine the principle health-care cost driver – the 3rd party payer system.
Call to Action: Though passed by an appalling political process and with complete disregard of our Constitution, though containing ineffective and even harmful policy, though disregarding the inalienable rights given to us by our Creator, the passed health-care reform bill is not the end of the debate but rather a new beginning. It is an opportunity to contrast irresponsible policy with prudent policy, to contrast misconceived policy with thoughtful policy, and to contrast policy that places government in the center with policy that places the individual in the center. Get in the fight and stay in the fight. We have learned, the hard way, the consequences of leaving it up to the career politicians. Contact your legislators and demand they exercise the privilege the voters gave them to represent us to effectively address health-care delivery and the other problems facing our states and nation. Learn about the issues and talk to others about the issues. We must join and financially support conservative think tanks that promote traditional American economic principles, personal freedoms, and values; and that shine the light of accountability on irresponsible or faulty government action and policy. Those organizations include The Heritage Foundation, The State Policy Network, The Commonwealth Foundation and your state’s conservative think tank (see SPN for your state’s organization). We must join and support our local grass roots organizations like the York 9-12 Patriots, York County Action, York Campaign for Liberty, and others, so we can take back the political process that has become corrupt and ineffective. We must work to bring up, from the grass root level, candidates – principled persons (Republicans, Democrats, and Independents) who will actually solve problems, who will respect the Constitution of the United States, and who will honor the “consent of the governed” entrusted to them by the citizens of our counties, states, and country.
God Bless and God Bless America
Monday, April 26, 2010
Sunday, April 18, 2010
Sensible Health-Care Reform (Part 2): Unsustainable Health-Care Growth
This is the second of a series of commentaries examining the state of health-care including the serious problems with health-care delivery, the underlying root causes of those problems, the looming government fiscal catastrophe secondary to health-care entitlement spending, the failure of the recently passed health-care “reform” to address the grave problems facing our nation related to health-care delivery, the harm the recently passed health-care “reform” will cause to our seriously ill economy, and a proposal for a framework to truly, effectively, and sustainably reform our health-care delivery system. This report will review and expand on a previous discussion on unsustainable health-care cost growth.
The author feels obligated to disclose underlying bias: 1. this analysis reflects the author’s strong belief in the efficiencies and fairness of free markets as well in the individual’s right and responsibility of self-determination and of self-reliance. 2. I have 3 daughters, 3 nieces, and 9 nephews who deserve their opportunity to live the American Dream – a dream made possible by the protection of our inalienable rights endowed by our Creator
Unsustainable Health-Care Cost Growth
Returning to the essential issue, health-care costs continue to climb, putting increasing fiscal strain on Federal, state, and local governments, as well as on businesses and families. According to a 2008 Congressional Budget Office report, from 1965-2005, costs have increased by a factor of 9 in inflation-adjusted dollars. Over that same period, health-care expenditure has increased from 5% to 15% of US GDP. A separate CBO statement reports Federal outlays for Medicare and Medicaid have risen 5 fold from 1970 to 2009, as measured as a percentage of GDP. In a recent letter to Senator Kent Conrad, the Chairman of the Budget Committee, the Director of the CBO reports that by 2017, Medicare Part A will have insufficient funds to pay for all covered services. The 2009 Medicare Trustees Reports estimates that the projected unfunded liability (the difference between costs of the benefits promised and the projected revenue from dedicated Medicare taxes and Medicare premiums) is $89 trillion dollars. This gap can only be closed with either significant benefits cuts, significant tax increases or both. That report estimated that a tax solution alone would require total payroll taxes to climb to 37% to meet the retirement promises (Medicare and Social Security (1/5th of the Medicare liability)) made to the young people who today are entering the work force. If payroll taxes don’t rise to cover the deficit, general tax revenues would need to be transferred to cover the shortfall. Currently, 13% of Federal tax revenues are spent to cover the Medicare and Social Security expenses. In the same report, that percentage is projected to grow to 27% by 2020 and 49% by 2030. As more of the budget flows to these entitlements, the other Federal Government services that now receive 87% of the Federal Budget e.g. defense, education, infrastructure maintenance, and the thousands of other federal programs, will consequently be progressively and drastically scaled back with alarming consequences.
Costs have grown faster in the private sector. A recent Kaiser health benefits survey found that employer-sponsored premium costs increased 119% from 1999 to 2008, far outpacing wage growth over the same period. The escalating costs have had significant chilling effects on the general economy and employment. Higher insurance benefits costs result in lower wages and in turn lower consumers spending and savings. For the businesses that provide health-care employee benefits, higher costs for that insurance leave less capital to invest in the business and make those businesses less competitive in the global economy. Broader detrimental economic consequences of these costs were confirmed in a recent RAND corporation study that demonstrated among corporations that provide employee health-care benefits, increasing health-care costs result in greater unemployment and lower industrial output.
The next Dr Right installment will examine value-added health-care cost drivers.
Call to Action: Though passed by an appalling political process and with complete disregard of our Constitution, though containing ineffective and even harmful policy, though disregarding the inalienable rights given to us by our Creator, the passed health-care reform bill is not the end of the debate but rather a new beginning. It is an opportunity to contrast irresponsible policy with prudent policy, to contrast misconceived policy with thoughtful policy, and to contrast policy that places government in the center with policy that places the individual in the center. Get in the fight and stay in the fight. We have learned, the hard way, the consequences of leaving it up to the career politicians. Contact your legislators and demand they exercise the privilege the voters gave them to represent us to effectively address health-care delivery and the other problem facing our state and nation. Learn about the issues and talk to others about the issues. Join your local grass roots organizations like the York 9-12 Patriots, York County Action, York Campaign for Liberty, and others, so we can take back the political process that has become corrupt and ineffective. We must work to bring up, from the grass root level, candidates – principled persons (Republicans, Democrats, and Independents) who will actually solve problems, who will respect the Constitution of the United States, and who will honor the “consent of the governed” entrusted to them by the citizens of our counties, states, and country.
The author feels obligated to disclose underlying bias: 1. this analysis reflects the author’s strong belief in the efficiencies and fairness of free markets as well in the individual’s right and responsibility of self-determination and of self-reliance. 2. I have 3 daughters, 3 nieces, and 9 nephews who deserve their opportunity to live the American Dream – a dream made possible by the protection of our inalienable rights endowed by our Creator
Unsustainable Health-Care Cost Growth
Returning to the essential issue, health-care costs continue to climb, putting increasing fiscal strain on Federal, state, and local governments, as well as on businesses and families. According to a 2008 Congressional Budget Office report, from 1965-2005, costs have increased by a factor of 9 in inflation-adjusted dollars. Over that same period, health-care expenditure has increased from 5% to 15% of US GDP. A separate CBO statement reports Federal outlays for Medicare and Medicaid have risen 5 fold from 1970 to 2009, as measured as a percentage of GDP. In a recent letter to Senator Kent Conrad, the Chairman of the Budget Committee, the Director of the CBO reports that by 2017, Medicare Part A will have insufficient funds to pay for all covered services. The 2009 Medicare Trustees Reports estimates that the projected unfunded liability (the difference between costs of the benefits promised and the projected revenue from dedicated Medicare taxes and Medicare premiums) is $89 trillion dollars. This gap can only be closed with either significant benefits cuts, significant tax increases or both. That report estimated that a tax solution alone would require total payroll taxes to climb to 37% to meet the retirement promises (Medicare and Social Security (1/5th of the Medicare liability)) made to the young people who today are entering the work force. If payroll taxes don’t rise to cover the deficit, general tax revenues would need to be transferred to cover the shortfall. Currently, 13% of Federal tax revenues are spent to cover the Medicare and Social Security expenses. In the same report, that percentage is projected to grow to 27% by 2020 and 49% by 2030. As more of the budget flows to these entitlements, the other Federal Government services that now receive 87% of the Federal Budget e.g. defense, education, infrastructure maintenance, and the thousands of other federal programs, will consequently be progressively and drastically scaled back with alarming consequences.
Costs have grown faster in the private sector. A recent Kaiser health benefits survey found that employer-sponsored premium costs increased 119% from 1999 to 2008, far outpacing wage growth over the same period. The escalating costs have had significant chilling effects on the general economy and employment. Higher insurance benefits costs result in lower wages and in turn lower consumers spending and savings. For the businesses that provide health-care employee benefits, higher costs for that insurance leave less capital to invest in the business and make those businesses less competitive in the global economy. Broader detrimental economic consequences of these costs were confirmed in a recent RAND corporation study that demonstrated among corporations that provide employee health-care benefits, increasing health-care costs result in greater unemployment and lower industrial output.
The next Dr Right installment will examine value-added health-care cost drivers.
Call to Action: Though passed by an appalling political process and with complete disregard of our Constitution, though containing ineffective and even harmful policy, though disregarding the inalienable rights given to us by our Creator, the passed health-care reform bill is not the end of the debate but rather a new beginning. It is an opportunity to contrast irresponsible policy with prudent policy, to contrast misconceived policy with thoughtful policy, and to contrast policy that places government in the center with policy that places the individual in the center. Get in the fight and stay in the fight. We have learned, the hard way, the consequences of leaving it up to the career politicians. Contact your legislators and demand they exercise the privilege the voters gave them to represent us to effectively address health-care delivery and the other problem facing our state and nation. Learn about the issues and talk to others about the issues. Join your local grass roots organizations like the York 9-12 Patriots, York County Action, York Campaign for Liberty, and others, so we can take back the political process that has become corrupt and ineffective. We must work to bring up, from the grass root level, candidates – principled persons (Republicans, Democrats, and Independents) who will actually solve problems, who will respect the Constitution of the United States, and who will honor the “consent of the governed” entrusted to them by the citizens of our counties, states, and country.
Sunday, April 11, 2010
Sensible Health-Care Reform (Part 1): Framing the Debate
This is the first of a series of commentaries examining the state of health-care including the serious problems with health-care delivery, the underlying root causes of those problems, the looming government fiscal catastrophe secondary to health-care entitlement spending, the failure of the recently passed health-care “reform” to address the grave problems facing our nation related to health-care delivery, the harm the recently passed health-care “reform” will cause to our seriously ill economy, and a proposal for a framework to truly, effectively, and sustainably reform our health-care delivery system.
The author feels obligated to disclose underlying bias: 1. this analysis reflects the author’s strong belief in the efficiencies and fairness of free markets as well in the individual’s right and responsibility of self-determination and of self-reliance. 2. I have 3 daughters, 3 nieces, and 9 nephews who deserve their opportunity to live the American Dream – a dream made possible by the protection of our inalienable rights endowed by our Creator
Although President Obama and the Democratic Congress has rammed through so called health-care reform, in fact, that “reform” can only make our health-care crisis worse, not better. To move forward with critically needed constructive health-care reform, it must be understood that two distinct starting points underlie the push to reform our current system. The first perspective stresses the need to address the problem of the uninsured and the related problem of pre-existing medical conditions. The second perspective stresses the need to control the escalating costs. Realistically to move forward with constructive reform, it must be acknowledged and understood that the first perspective must be subordinate to the second. Very clearly, the health-care cost growth is fiscally untenable going forward. Reform that expands access without first controlling costs can only result in accelerated failure of the system and is no reform at all. A health-care system that now threatens the financial viability of many individuals and families, many businesses, and multiple state and Federal governments makes all other health-care issues moot. Access to health-care for the uninsured or those with pre-existing medical conditions must be addressed but can not be addressed on a sustainable basis until tackling the fundamental issue of unsustainable health-care costs growth. That being said, proper reform that results in lower health-care costs and consequent lower health-care insurance costs, would go a long way toward addressing the uninsured and pre-existing medical condition problem by making coverage more affordable.
Before addressing the central issue of escalating cost, a brief examination of the uninsured population assists in placing perspective on the health-care reform discussion as well as on the proposed solutions. The number of uninsured persons is somewhat fluid. The US Census Bureau places the estimate of the number of the uninsured at 47 million or 16% of the population. Conversely, 250 million Americans have coverage and, for the most part, are satisfied with that coverage. The number of uninsured individuals is significantly related to employment. 2008 statistics from the CDC, found that change in employment accounted for 24% of the uninsured.
A study done by the Agency of Healthcare Research and Quality looking at statistics of the uninsured during the period of 1996-2008, found that for the full year of 2007, there were 39.9 million uninsured persons under the age of 65. That number included 5.9 million children who qualified for government subsidy or whose families were able to afford insurance. That number also included 12 million illegal aliens. The AHRQ also found that of those uninsured individuals 18-24 years of age, 55% were uninsured for at least a month but only 18% for a 2 year period, indicating many individuals without health-care are so temporarily. This data further suggests the actual number of chronically uninsured amounts to a fraction of the commonly reported 47 million uninsured thus bringing into question the logic of addressing the problem of the chronically uninsured (a small percentage of the population) by a massive Federal takeover of health-care that would affect the great majority who have and are happy with their insurance coverage.
A study out of Baruch College, City University of New York reviewed information from surveys of the uninsured population and found that 43% of those in the 18-64 year age group had incomes of at least 250% of the Federal poverty level suggesting that many persons in this category have made a financial allocation decision not to obtain health-care insurance though they likely could do so, albeit significantly constraining other discretionary spending. The investigators in this study classified these persons as “voluntarily uninsured” and the remaining 57% with lesser financial means as “involuntarily uninsured”. They further found that the entire uninsured population still has significant access to health-care services, but approximately 40% of services utilized by those with insurance. Interestingly, the percentage of the uninsured group accessing cancer screening services roughly equals that of those in the Canadian nationalized, single-payer system.
The next Dr Right installment will review the unsustainable health-care costs growth.
Call to Action: Though passed by an appalling political process and with complete disregard of our Constitution, though containing ineffective and even harmful policy, though disregarding the inalienable rights given to us by our Creator, the passed health-care reform bill is not the end of the debate but rather a new beginning. It is an opportunity to contrast irresponsible policy with prudent policy, to contrast misconceived policy with thoughtful policy, and to contrast policy that places government in the center with policy that places the individual in the center. Get in the fight and stay in the fight. We have learned, the hard way, the consequences of leaving it up to the career politicians. Contact your legislators and demand they exercise the privilege the voters gave them to represent us to effectively address health-care delivery and the other problem facing our state and nation. Learn about the issues and talk to others about the issues. Join your local grass roots organizations like the York 9-12 Patriots, York County Action, York Campaign for Liberty, and others, so we can take back the political process that has become corrupt and ineffective. We must work to bring up, from the grass root level, candidates – principled persons (Republicans, Democrats, and Independents) who will actually solve problems, who will respect the Constitution of the United States, and who will honor the “consent of the governed” entrusted to them by the citizens of our counties, states, and country.
The author feels obligated to disclose underlying bias: 1. this analysis reflects the author’s strong belief in the efficiencies and fairness of free markets as well in the individual’s right and responsibility of self-determination and of self-reliance. 2. I have 3 daughters, 3 nieces, and 9 nephews who deserve their opportunity to live the American Dream – a dream made possible by the protection of our inalienable rights endowed by our Creator
Although President Obama and the Democratic Congress has rammed through so called health-care reform, in fact, that “reform” can only make our health-care crisis worse, not better. To move forward with critically needed constructive health-care reform, it must be understood that two distinct starting points underlie the push to reform our current system. The first perspective stresses the need to address the problem of the uninsured and the related problem of pre-existing medical conditions. The second perspective stresses the need to control the escalating costs. Realistically to move forward with constructive reform, it must be acknowledged and understood that the first perspective must be subordinate to the second. Very clearly, the health-care cost growth is fiscally untenable going forward. Reform that expands access without first controlling costs can only result in accelerated failure of the system and is no reform at all. A health-care system that now threatens the financial viability of many individuals and families, many businesses, and multiple state and Federal governments makes all other health-care issues moot. Access to health-care for the uninsured or those with pre-existing medical conditions must be addressed but can not be addressed on a sustainable basis until tackling the fundamental issue of unsustainable health-care costs growth. That being said, proper reform that results in lower health-care costs and consequent lower health-care insurance costs, would go a long way toward addressing the uninsured and pre-existing medical condition problem by making coverage more affordable.
Before addressing the central issue of escalating cost, a brief examination of the uninsured population assists in placing perspective on the health-care reform discussion as well as on the proposed solutions. The number of uninsured persons is somewhat fluid. The US Census Bureau places the estimate of the number of the uninsured at 47 million or 16% of the population. Conversely, 250 million Americans have coverage and, for the most part, are satisfied with that coverage. The number of uninsured individuals is significantly related to employment. 2008 statistics from the CDC, found that change in employment accounted for 24% of the uninsured.
A study done by the Agency of Healthcare Research and Quality looking at statistics of the uninsured during the period of 1996-2008, found that for the full year of 2007, there were 39.9 million uninsured persons under the age of 65. That number included 5.9 million children who qualified for government subsidy or whose families were able to afford insurance. That number also included 12 million illegal aliens. The AHRQ also found that of those uninsured individuals 18-24 years of age, 55% were uninsured for at least a month but only 18% for a 2 year period, indicating many individuals without health-care are so temporarily. This data further suggests the actual number of chronically uninsured amounts to a fraction of the commonly reported 47 million uninsured thus bringing into question the logic of addressing the problem of the chronically uninsured (a small percentage of the population) by a massive Federal takeover of health-care that would affect the great majority who have and are happy with their insurance coverage.
A study out of Baruch College, City University of New York reviewed information from surveys of the uninsured population and found that 43% of those in the 18-64 year age group had incomes of at least 250% of the Federal poverty level suggesting that many persons in this category have made a financial allocation decision not to obtain health-care insurance though they likely could do so, albeit significantly constraining other discretionary spending. The investigators in this study classified these persons as “voluntarily uninsured” and the remaining 57% with lesser financial means as “involuntarily uninsured”. They further found that the entire uninsured population still has significant access to health-care services, but approximately 40% of services utilized by those with insurance. Interestingly, the percentage of the uninsured group accessing cancer screening services roughly equals that of those in the Canadian nationalized, single-payer system.
The next Dr Right installment will review the unsustainable health-care costs growth.
Call to Action: Though passed by an appalling political process and with complete disregard of our Constitution, though containing ineffective and even harmful policy, though disregarding the inalienable rights given to us by our Creator, the passed health-care reform bill is not the end of the debate but rather a new beginning. It is an opportunity to contrast irresponsible policy with prudent policy, to contrast misconceived policy with thoughtful policy, and to contrast policy that places government in the center with policy that places the individual in the center. Get in the fight and stay in the fight. We have learned, the hard way, the consequences of leaving it up to the career politicians. Contact your legislators and demand they exercise the privilege the voters gave them to represent us to effectively address health-care delivery and the other problem facing our state and nation. Learn about the issues and talk to others about the issues. Join your local grass roots organizations like the York 9-12 Patriots, York County Action, York Campaign for Liberty, and others, so we can take back the political process that has become corrupt and ineffective. We must work to bring up, from the grass root level, candidates – principled persons (Republicans, Democrats, and Independents) who will actually solve problems, who will respect the Constitution of the United States, and who will honor the “consent of the governed” entrusted to them by the citizens of our counties, states, and country.
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