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February 2006 archives
Apart from being two right-wingers favorite straw men, school choice (in Milwaukee) and socialized medicine (in Maine) have a lot in common. They are both good illustrations why Americans can’t create an incomplete solution to a system-wide problem. And yet we do that time after time.
Up in Wisconsin, Milwaukee has school choice program which allows some generally poor (and often black) kids to go to the better private school down the road. This drives the National Education Association (the teacher’s union) insane, because they see all they’ve gained in becoming public employees being destroyed if the system is privatized. Of course they can’t and don’t say that, so they say instead that school choice is depriving the public schools of funds and sending them to private schools instead. And they are being beaten with a 2-by-4 by John Tierney in the NYT about that.
Meanwhile, in Maine - not exacly the hotbed of social experimentation that Wisconsin has been - the new attempt to expand state-funded health insurance to the uninsured is being slammed by that rational oracle of capitalism the WSJ Opinion page as socialized medicine. What’s their main complaint?
Through the first nine months only 1,600 previously uninsured individuals enrolled in Dirigo Health's insurance product, called DirigoChoice. The other 6,000 who enrolled simply traded their private health insurance for taxpayer-subsidized DirigoChoice. The program continues to spend millions subsidizing insurance for those already insured.
This is what right-wing economists call public coverage “crowding out” private insurance. And they’re right. Over the past 15 years public coverage (mostly via Medicaid) has expanded and private insurance (from employers) has been evaporating. Now which way the cause and effect goes is something economists can argue about, and it hasn’t massively changed the number of uninsured, but the micro-economics are clear. The taxpayer is paying more and relatively employers are paying less.
Continue reading "Everyone In The Pool" »
In many ways, Intel Corp. is the anti-GM. So looking at what Intel’s doing with its health care benefits is instructive and pretty frightening for those of us not working in such rich company and for the health care system, over-all.
At a conference last week, Intel (along with Cisco and Oracle) gave some more information about an announcement they’d made to reward physician groups in the Bay Area that used technology and improved patient outcomes. But that program is mostly symbolic and I wanted to know what their real motivations were. In the Q&A they weren’t very forthcoming. Not, you’ll understand, because they were hiding anything, but because I don’t think that they think about the entire health care system as much as their part of it. Corrie Zenzola, US Benefits Health Initiative Strategist at Intel, was strident in saying that Intel would keep providing health care benefits for its workers.
Now of course the average Intel employee represents a huge chunk of revenue — Intel employees are young (average age in the US is 39) and with revenues over $30 billion their revenue per employee is north of $300,000. So health care costs are nowhere near the percentage cost of labor for Intel that they are for the restaurants that have been getting upset about pay-for-play in San Francisco.
But Intel’s response to the health care system’s cost crisis in the last few years is instructive. After the boom, life got very tricky for Intel, and they completely re-designed their health benefits after 2001. Corrie told me that prior to 2001 employees didn’t have to pay anything toward their premiums at all. Now they have a choice. Employees with families can with pay $400–ish a month for comprehensive first-dollar-ish coverage, or pay nothing and get $4,000 deductible plan and a health savings account (HSA) that they can contribute to tax-free and pay for health care from — but which Intel will not pay into. If you’re single and unhealthy, you’re better off taking the comprehensive coverage, but for the family employees with dependents, they’ve made it so that you’re a little better off going the HSA route.
This makes lots of sense for Intel. They still have to pay for the few expensive people who run up much more than $4,000 a family in costs but they’ve got out of paying for everyone’s “first-dollar” coverage. The math works out that they are paying some 60–70% of what they would have paid before, They’re basically paying for 80% of the costs for their most expensive 20% of employees (who use 80% of the care dollar) and not paying anything for the rest. The balance of the money (for all the care of most people, and the first few thousand dollars of the sickies) now comes from the employees, not from the company. Intel employees are usually highly-paid so it’s not that big a deal for them. But's the problem is that it's a microcosm of where the Republicans want to take the country.
Continue reading "Inside Intel's Health Care System" »
I’ve just returned from a conference on “pay for performance” run by the good guys in the US health care system. At the same time I’ve just finished reading John Perkins’ Confessions of an Economic Hit Man. The book is a great expose of the nuts and bolts of how corporate interests trampled over the interests of third world countries, and incidentally those of most Americans. I’m struck by how similar the story is to that of America’s healthcare system. Like the real story behind global economic development and empire, there’s a similar conflict in our health care system.
Continue reading "Confessions of a Health Care Hitman?" »
My father, the doctor who apparently went to history lectures instead of physiology lectures at Cambridge, used to love to quote the story of British colonial “hero” Clive of India. When Clive was investigated for excessive plunder, his defense to the British parliament was that he “stood amazed at my own moderation”. The Parliament of the time let him off, free to go plunder more. After a whole lot of fuss about what President George W. Bush was going to say in the State of the Union about health policy, we too can be amazed at his moderation. Given how keen this Congress and its leaders are on bribery, we can be sure that the result will be that the US health care system will enjoy much more plundering in the years to come. And largely the taxpayer is going to play the role of the plundered Mahahrajah.
Bush basically said nothing in Tuesday's State of the Union speech. That’s partly because the main health care bill passed under his watch, the Medicare Modernization Act, was an act of plunder, that promised a prescription drug benefit program for seniors as its political cover. As has been reoeatedkt discussed - including in this special blog at TPMCafe - the implementation of the Medicare "Part D" drug benefit has been a total screw-up. The consensus is that Bush didn’t talk up any new health care reforms because he didn’t want to bring up Part D, or give the Democrats the chance to (justly) criticize the program in their response to his speech.
What might Bush push for now that the speech is over?
Continue reading "Amazed at His Moderation?" »
