Tuesday, December 22, 2009

Congressional Failures and Health Reform

“so we cheated and we lied and we tested
and we never failed to fail – it was the easiest thing to do”

- Stephen Stills

It’s hard to avoid the spin being put on health care reform by all sides. The left would have us believe that they have succeeded in creating a utopia where all citizens will have health insurance, people won’t be denied coverage because of pre-existing conditions and costs to individuals and families will be controlled. Meanwhile, the right would have us think that “Obama-care” will mean higher taxes on families to pay for additional government spending, and massive expenses for businesses that will now be required to provide insurance benefits for all employees.

So who’s spin is correct – or at least, closer to the truth? Actually, I don’t buy either side’s arguments as I consider the bills that are about to be reconciled as a complete failure for average citizens.

First of all, the major failing of the current bills is that they don’t address cost control by creating a public option that would compete directly with private insurers. Without this competition, insurance companies can and will still increase premiums. In fact, since insurers will be “forced” to take all comers and not limit their “risk pool” by taking on only those least likely to need their services, they will, without a doubt, increase premiums from day one to reflect their added costs. They are for-profit entities after all, and their first priority is to shareholders.

Secondly, I believe that (as I have discussed here last March) the insurance industry has as much exposure to toxic debt as banks do, but Fannie and Freddy aren’t shoring up their balance sheets ala the banks, thus insurers face a pending financial disaster as their investments tank. But after the TARP fiasco, absolute public outrage would be unavoidable if Congress proposed a bailout of insurers. This new “reform bill” has become a publicly palatable way to support the insurance industry by mandating that all citizens buy coverage. Translation: 20% of the population not currently spending money on insurance policies is about to – viola, problem solved.

Finally, if anyone thinks that the pharmaceutical manufacturers and insurance industry don’t love this bill, they should take a peek at the money spent lobbying for it. Politico has reported that:

“A closer look at some of the health care lobbying expenditures shows just how high the stakes are. PhRMA, a top trade group for drug makers, spent as much as it did in all of 2008 — $20.2 million — during the first nine months of 2009. America’s Health Insurance Plans is also on pace to outspend its 2008 lobbying budget, spending $6.3 million during the first nine months of this year."

And these numbers are from only 2 individual special interest groups. There are many more who have spent millions in addition to these sums. Think they didn’t get it the way they wanted it? You’d better think again.

So what’s the bottom line? For me it’s simple: the beneficiaries of the supposed health care reform effort will be the same ones who need to be regulated and better controlled – insurers and drug manufacturers. Will there be benefit for citizens? Maybe. But since we don’t pay as well as the special interest groups, it’s likely that our benefit will be much less than what Congress is about to hand over to insurance and drug companies. And why shouldn’t our benefit be less? After all people get what they pay for.

Wednesday, November 18, 2009

The Return of the Gold Standard

Waiting for the Dow Jones to implode has been a long and frustrating process for those who have been anticipating financial Armageddon since long before most people in the U.S. had ever heard the terms “credit default swap” or “derivative”. While there definitely was a sudden and steep drop in the market’s valuation from October of 2008 until about mid-March of 2009, as steep as that correction was, it was very brief and the resulting rise that followed has stubbornly defied the law of gravity. This correction or over-correction if you will, from the March lows has not been supported by much of anything substantive.

Since March, employment has continued to crater; housing sales have largely consisted of foreclosures picked up on the cheap by vultures or first time homebuyers taking advantage of an $8,000 tax credit; and retail numbers have failed to improve significantly, yet retailer stocks have been bolstered - not by improving sales, but by cost cutting and overhead reduction that has come most often in the form of layoffs.

In this same time frame, banking has also been salvaged. Again not because of its own decisions and practices, but because of the government’s willingness to utilize Fannie Mae and Freddy Mac to purchase banks’ toxic assets at close to, if not full, face value despite the lack of any realistic market for these products. To support these purchases and to reload banks’ vaults, the Fed has resorted to printing money. The actual dollars in circulation have nearly doubled in the last 12 months, yet the government insists that inflation is low.

And despite all the propaganda spewed by the government, the media and all the parroting talking heads who have worked tirelessly to convince the American public that “all is well”, fewer and fewer people outside the U.S. are acting as though they believe it. Foreign interest in U.S. debt, specifically in U.S. treasuries, has waned enough that the Fed has been purchasing its own treasuries for the better part of the last year when they have failed to generate sales at auction. This is akin to someone writing themselves a check from their own empty account and expecting it to clear.

But the curtain that has shielded the wizard, as it were, is being pulled back.

Watching gold climb to new records on a near daily basis has tipped the government and Federal Reserve’s hand. They have been printing money like demons and since it has to go somewhere, it inevitably finds its way into the stock market. This sets people up to think all is well, but our creditors know the score. They don’t think we have done anything other than debase the dollar and so they are starting to bet that we will default on our debt.

Think we won’t? You’d better think again. The U.S. economy, one that is more than 70 % based on consumerism, is still in very real trouble. We went from the largest creditor nation on Earth to the largest debtor nation in less than fifty years. Our economy has moved away from manufacturing and production and moved into consumption and consumer debt servicing. The wall we have hit, largely a production of our spiraling debt and declining incomes, is not one that will be easily remedied.

And our creditors, with reality staring them in the face, have begun to hedge their bets on a medium that has been around far longer than any other currency – gold. While the precious metal’s price has been climbing to new highs, the Dow has followed suit and continued its march back toward unrealistic levels. The difference being that when the Fed is done printing in its desperate effort to maintain civility by preventing a panic in the U.S., the dollar won’t be worth the paper it’s printed on and gold will again be the world’s baseline currency.

Wednesday, September 30, 2009

Sold Out

We have been duped. That’s all there is to it. There’s no other way to describe the actions perpetrated on the citizenry by the corrupt and fouled human garbage that passes as governmental leadership in this country. Yesterday, our elected officials voted against creating a government funded health insurance option. Not a “takeover” of the health care system (which by the way, the government already heavily regulates thanks to its Medicare and Medicaid reimbursements), but simply the creation of publicly funded insurance policies that would offer some relief to those of us who pay increasingly handsomely to our insurance companies for ever diminishing coverage.

We were told by our bloviating talking heads and too many congressional members that a government run health insurance option would lead to socialism. We were told that the government would deny care to those who are too young or too old or too sick. We were told that capitalism and free markets are the only true American way to fix anything. Quite simply, we were lied to.

First, there’s that socialism thing. There are many democracies and capitalistic nations that offer a public health insurance option – in fact, the list includes all of them except the U.S. We are the lone wealthy, developed nation that does not provide its citizens this basic service. And why? Well, the insurance companies would be forced to compete with a more efficient, non-profit entity that would put them and their staggering profits to shame. They would be forced to become more efficient (reducing obscene pay and bonuses for the executives), cover more claims (they currently work to pay out as little as possible on all claims – profits are the goal, remember?) and offer more reasonably priced policies. Yeah, that’s a bad idea.

Socialism, as defined by the Merriam-Webster Online Dictionary, is “any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods”. It is not a situation where the government provides a service to its citizens. No one cries socialism when they talk about the public school system or the police or Emergency Medical Services or the military. There are private companies that compete with the government on all of these fronts (private schools, private security services, etc.), and they don’t complain about their businesses being unfairly harmed by publicly funded services. The socialism argument is a red herring.

How about the argument that the government would deny care? The last time I checked, the private insurers were the ones who refused to pay claims. It’s the private insurance companies that pre-screen and deny applicants and pre-approve claims. They are the ones who refuse payment for anything that’s new or expensive. They are the deniers of care, not the government funded programs Medicare or Medicaid.

To be clear, Medicare and Medicaid often don’t reimburse (pay) for all the costs, but no one dies while waiting for pre-approval and they don’t work diligently to deny care so they can make money.

How about that whole free market thing? Well, if the government began a publicly funded insurance option, it would compete in a free market. How much more capitalistic can you get? If one company can offer the same thing as another for a lower price, the other company has to become more efficient, find another niche, or get out of the business, right? What could be more American?

But insurers don’t want competition. They all work together to set prices and extort payments from us to make them wealthy. They tell us we need them. They tell us they will take care of us. The only ones they are interested in are themselves. They want huge profits so they can get large bonuses and make even more money. Competition will reduce their ability to make those staggering profits, so they have spent billions on convincing us and our representatives that somehow competition is not capitalism.

Now, from what I have seen, the insurers are winning. We have no public option that seems imminent and thus, the insurers have no competition. Prices for health care won’t be coming down anytime soon. But rest assured - our noble and fearless leaders are considering MANDATING that every citizen have health insurance. That is, if our employer does not provide it, we will be forced by law to purchase insurance from one of the major insurers. So instead of promoting efficiency by competition, the government has forced us (and our money) into the waiting arms of……you guessed it, the insurance industry. What a country!

Apparently, our government is more interested in representing the insurance industry than those who actually voted them into office. We have been sold off like so much garage sale merchandise – on the cheap and without a care. Until the populace wakes up and becomes outraged, nothing will get better. It will only become worse.

“We do not have to visit a madhouse to find disordered minds; our planet is the mental institution of the universe.” ~Johann Wolfgang von Goethe

Friday, September 18, 2009

On The Fringes By Choice

I couldn’t help but smile when I saw his name on my patient list. I thought, “There must be more than one ______ ________ in the world, but certainly not in this area”. I checked the records, and sure enough, it was him. I won’t use his real name here, as he has a right to his privacy, so I’ll use the pseudonym “Bob”.

I got to know Bob when I was a very young man - both emotionally and chronologically – and we worked together as guides for a whitewater rafting outfitter. He was, I thought until this week, much older than me. It’s funny how years and distance can actually make you seem closer to people, at least in age, than you once were.

His face had not changed much, though it was perhaps a bit more weathered. I couldn’t help but think this was the first time I had seen him without a cigarette in his mouth, sunglasses on his face, and completely sober. The lifestyle of a rafting guide can be as variable as the personality of each individual, but for a large number, it involves excessive alcohol consumption, heavy smoking (tobacco as well as marijuana) and telling stories that are upwards of 10-20% true.

Some guides are college kids who need seasonal work and don’t want to spend four months away from school flipping burgers at fast food joints. Many are near migrant workers, following the transient seasonal work from the rivers to the mountains, working winters as ski instructors or patrollers. These would be the ones who may or may not have dropped out of college, or just have not found or accepted what society has to offer them. Bob embodied the latter group.

I have long since given up the life of a guide – spending more than I earned in the company bar, chain smoking and trying desperately (and mostly unsuccessfully) to convince attractive women customers that a fling with a grungy, unshaven man who sported a tan that outlined a lifejacket on his upper body was a good idea. But back then, I thought guys like Bob were the ones who had it together: they had no permanent homes, no wives or children (that they knew of), few bills and worked “real jobs” sporadically at best. At the ripe old age of 20, it was my bohemian dream to follow in their footsteps.

Alas, time moves forward and most of us grow up and become adults – or at least more emotionally mature – and move closer to the center of society. That is, we find regular work, satisfying personal relationships and become more main stream. Bob never did though. He still hangs on to much of the old lifestyle - it has been too hard for him to give it up. He still makes his annual or bi-annual pilgrimage to the canyon so he can row the greatest river in North America; still has no wife or kids (that he knows of); still does not have a “regular” job as it would interfere with his play time; and still smokes like he’s sponsored by Philip Morris.

As a result of his own choices, he is one of our millions of uninsured in America. Not that he minds, or that he wants more from the health care system than he is willing to pay for out of his own pocket. He had a blocked coronary artery several years ago that required the placement of a stent and he paid for it himself – eventually. He now takes bottles of nitroglycerin with him on his canyon trips, because as he told me, “you never know and it’s a long ways away from anywhere”.

The cardiologist in our office who saw him told me Bob needed to stop smoking and make some significant changes if he was going to have a shot at growing old. I told the cardiologist that Bob would do no such thing – it’s just not who he is.

Bob would rather die relatively young doing what he enjoys and without regrets than stop being himself and live longer. He has followed the “live fast, die young and leave a good looking corpse” philosophy to the letter, except that he has made it farther than he likely ever thought he would. He has managed to outlive many of our old comrades and friends despite maintaining the lifestyle. Too many of the people we knew died young as a result of poor choices and bad luck.

I don’t know where people like Bob fit into the health care debate because he’s such a rarity: he’s non-compliant for the most part, but does not hold anyone but himself responsible for his problems. He throws off the curve, if you will. People like Bob will not buy health insurance (even if forced at gunpoint) because they just don’t see a need. He’s self sustaining and uses only the services he needs when he needs them. And he pays for it himself. He’s not our typical member of society by a long shot.

He’s Peter Pan – but older now and all too vulnerable to those things that affect mere mortals. And even though it’s for different reasons now, he still has my respect.

Friday, September 11, 2009

Returning The Hope I Bought

"No, I'm not disillusioned. I'm just not illusioned, either.” – Bob Dylan

In this response to a question posed by an interviewer in 1965, Dylan captures simply and completely my feeling about President Obama and his attempts to rehab the health care system in the U.S. Indeed, after watching the president speak to Congress the other night and witnessing the response from both sides of the chamber, I was left with a feeling that’s significantly less than excited, but not quite apathetic. I do believe that some reforms are on the way, I just don’t think they will be immediately or significantly effective.

My wife watched the speech live, but I was only mostly attentive to it from across the room. She was disappointed with my response and lack of enthusiasm – especially since the topic is discussed almost daily in our house. I listened to Obama talk as I typed an email to a friend about an upcoming backpacking trip. My wife questioned me about my restrained excitement and I replied that I was less than enthralled with what I deemed theater from a president for whom I had much higher hopes. I have seen little of what was promised actually get done and am left, again, feeling jilted by our governmental leaders.

It’s not that I’m cynical enough to think nothing will happen with health care reform – it’s just that I’ve been paying attention to politics and government for too long to think any changes made will be right the first, second or third time around. Reform will be something that’s tinkered with in small increments and over a long period of time. Eventually, it may be done right, but perhaps that won’t happen for the next 20 years.

Sitting there, trying to understand my own sentiments, I couldn’t help but think about the reforms that were enacted on the credit card industry this past spring and summer. They were supposed to help consumers by limiting why and how quickly the card issuers could raise rates. They were touted as a big “win” for regular folks against issuers who had been able to seemingly raise rates and change the rules whenever they wanted. In the end, the unintended consequence of those credit card reforms was that the issuers hiked rates on cardholders before the laws prohibiting the same took effect. As a result of “helping” out the consumer, rates on most cardholders are now 3-4 times what they were previously. This kind of help “fixing” health care we don’t need.

While Obama was getting heckled, I decided to take a quick tour of opensecrets.org and peruse their charts detailing money donated by the insurance industry to candidates up for re-election in 2008. It’s an impressive list that includes politicians from both major parties – the largest donations going to the leaders of each party and those with positions of influence over potential reforms. I quickly reminded myself that hope is often sold and seldom redeemed for any value - but campaign contributions almost always pay dividends.

I decided to go to bed and not go over it all again. When my daughter is old enough, I’ll show her how our government, and indeed our country, really works. I’m sure I will almost feel guilty for showing her the things I have learned over time and through repeated frustrations. But she’ll need to learn these things while she’s still young enough to not fall prey to the theatrics that pass for political statesmanship. When I’m done, she’ll be no one’s fool and she’ll be able to spot the Shakespearian influences immediately.

Ultimately, I think health care reform will get close to where we need it to be - but today I am stuck somewhere between hopeful and hopeless. The simple truth is that while most citizens will feel as though they are helped by the reforms that ultimately get enacted, a select few – the wealthiest citizens – will no doubt benefit disproportionately thanks to a government that is only too happy to receive their donations and “support” when it comes to election time.

As for me, I have no utopian visions for our health care system. I just want to see that something worthwhile gets done so that people get the care they need. I’ve heard enough talking about what, who, how much and why – now I want to see what can be accomplished. It’s time to put up or shut up. Come on Mr. President and Congress – I’m not hard to impress and my expectations are minimal.