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  • Another Health Insurance Reform Option

    Posted on August 11, 2009 by drinker

    The debate on health insurance reform has been pretty heated lately.  Much of it has been centered on a public option or no public option.  I don’t like the public option.  If this is not your first time reading my blog this should be no surprise.  But I do believe that government has a role in the nation’s health insurance or health care. 

     

    In the following blog post I hope to address what is good about the current system. Explain what is bad about the current system. Finally I will explain my plan to change it without resorting to a public option.

     

    In the United States if you have a good health insurance plan you get the best care in the world. If you need to see your personal doctor you can generally walk in that day.  Perhaps you need to see a specialist well maybe that will take a week. Perhaps you need a MRI, which takes a week at the most.  In comparison all of these tasks in many of the socialized medicine world would take much longer.  Statistics are readily available on the web from Canada’s and Britain’s own healthcare websites.

    Canada: http://www.hc-sc.gc.ca/hcs-sss/qual/acces/wait-attente/index-eng.php

    Some more: http://www.hrsrh.on.ca/PortalEn/tabid/859/Default.aspx

     

    Britain: http://www.performance.doh.gov.uk/rtt/index.htm

    and in english: http://www.guardian.co.uk/uk/2007/jun/07/politics.health

    And England meets its goal: http://news.bbc.co.uk/2/hi/health/7966404.stm

     

    So in the United States when you have good Health Insurance you are taken care of pretty well.  But the problems come in those who don’t have health insurance or those people that are impossible to insure.  The costs associated with these individuals are the problem.  It is not the profits that the insurance companies make that are causing the rising cost of insurance.  Even if the profits were paid back to the individuals most would be minimal reductions in premiums at best. 

     

    Now let us talk about one solution to this problem.  We should take what works and keep that.  This is the traditional private insurance model, where premiums are pooled and costs taken from these pools.  Next we try to address the two primary reasons why the market is broken.  Those without insurance not paying for care and those that have such horrible health problems they are impossible to insure for premium that those individuals can afford. 

     

    This is the point that government can step in.  The government can begin a plan as the catastrophic insurer, essentially taking over the costs of those who are too expensive to insure.  They would not do this directly but indirectly through the first party insurance company.  This is done on an individual basis, where the premiums paid by the individuals have been less than one third the cost of treatment over the past five years.  In other words, if an individual pays $3000 in premiums but their treatment is costing $10000 the government would pick up $1000(The numbers I chose are for simplicity and should be adjusted in any real world situation).  This solves a major problem which is the person who uses far more health resources then they have paid. They are still costing the insurance company more money then the premiums, but because it will only take two other people’s premiums to break even on this, rates will not have to be increased.

     

    The second point at which the government can step in is regulating that all people in the country must purchase health insurance.  Those without health insurance will be penalized much like those without car insurance are today.  If you don’t have health insurance you will be reported to the proper authorities.  Maybe some type of subsidy can be provided but the market should be allowed to function.  And much like car insurance was very expensive it too will come down in price once competition and cost savings are implemented.

     

    Now let us move on to what the private health insurance companies will have to give up.  Health Insurance companies must cover all non-cosmetic procedures, either pre-existing or not.  All people must be able to be covered and the difference between the highest premium and the lowest premium may not exceed a certain amount (or some other price capping mechanism, although the government stepping in as the catastrophic coverer should help with this).  This will eliminate those that can not buy insurance and everyone will be able to afford some type of insurance.  It may hurt for some but they will be able to purchase the insurance needed.

     

    Some other miscellaneous things I would like to add to the debate. 

    • Some form of tort reform is needed.  Loser pays is a nice option.  Also a cap on non-gross-negligence problems.  Nicking a blood vessel while doing all that is humanly possible, although tragic for those involved, should not award an ownership stake in the hospital, but cutting off the wrong leg should result in a hefty cash settlement.
    • Keep the “health saving accounts” alive.  Allow people to put away a certain amount of money tax free that could go to health care related expenses.
    • Move some medical school interns out of the hospital and into the doctor’s office.  These students could be cheaper alternatives for the run of the mill doctors visits.  A real doctor must be present in the office but let’s be honest how many times did the visit to the doctor’s office result in a prescription for an anti-biotic and some bed rest.  These could also be nurses with some additional training.  Or think of it as Doctor-Lite.
    • Allow for both employer and self employed to purchase plans with pre-tax dollars. 
    • Allow for people to form groups that can purchase insurance as a block and not as individuals
    • Remove the State Restrictions from insurance sales.  Even this means the implementation of Federal Minimum Standards.  States could still come in to offer non-binding approvals.
    • Finally an easy to read rating system would be very helpful.  Much of the problem of health insurance purchase it that there is too much lawyer speak and not enough easy to understand language. 

     

    I want to end with one more observation.  The reason that such strides have been made in health care in the recent decades have been made is because of the money that can be made in the field. From the creation of the next Jack-Pot drug to a new surgical technique that revolutionizes the industry, most of these advances came about from people working long hours to become the leader in a particular market to make lots of money. 

     

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  • Health Insurance Competition

    Posted on July 2, 2009 by drinker

    I just wanted to put something out there because I am getting tired of the argument that the “public option” would just add much needed competition to the healthcare market.  For those liberals who now, after deriding competition in every other portion of their lives, have found a love for competition.  Then again when you are playing for the team that that referees bet on before the game, competition seems great.

    Do these people really think that the public option will compete on a level playing field? Of course it will not.  The public plan will be able to run at a severe loss and just ask for more tax payer money.  The private plans will not be able to do this.  Ironically the profits the private companies will be making will be taxed, and this tax will go to help the public plan undercut the profits for the private company.  In addition, because current private insurance will be taxed as income, the private insurance companies will have to drop the prices of their plans to account for increased cost of the plans. 

    I think many of the regular Joe’s pushing for the public opinion are primarily looking at this through hate filled eyes.  Much of this is probably warranted as the private insurance companies have pulled some very dirty tricks on people.  Issues from pre-existing conditions, dropping people for minor infractions, and just charging too much are all valid reasons.  I think in this case the cure is worse than the sickness.

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  • Alternative to Obamacare

    Posted on June 17, 2009 by drinker

    As most of you know I am not a fan of government run healthcare.  The reasons of course are numerous.  Most of my reasons for opposing this have to do with the incompetence and corruption that government ventures bring like flies to shit. 

    Simply being opposed to something is usually not enough for an argument.  Unless of course you believe the current situation is perfect.  I do not think the current situation is perfect but the alternative of increased government intervention will result in a worse situation.  Although a few additional people will have health insurance the vast majority will see their current coverage slowly die.  The reasons for this are multiple but most of the reasons have to do with the government run plan being subsidized by the tax revenue more and more till the private insurance companies cannot compete.

    If we assume that the current plan is similar to a government run health insurance provider, similar to Aetna or United Healthcare.  The difference would be that, instead of being run for profit it would be run for the good of the people.  Those familiar with the term “good of the people” know that it means it will be thousands of jobs for the campaign workers of the winning party.  The most important difference although is not in how the theory of how the company is to be run, but by the sources of funding for the company.  While a private health insurance company is paid primarily by premiums paid by the policy holders, the public plan will be paid by a combination of “affordable premiums” and government taxes.

    So far we outlined the future of the system under the current plan but what makes the current system so broken it needs such radical fixes?  There are a few pieces of the current system that are broken.  The first is the current price of insurance premiums.  Many people cannot buy health insurance because it is priced too high.  The reason for this is primarily that the person is trying to buy a policy just for their family.  While businesses have bulk policy leverage to bring the price down the individual does not.  The second problem with the current system is paying for coverage and not getting coverage.  This can range from “preexisting condition” to “uncovered procedure” problems.

    I personally believe that when someone buys health insurance it should pay for all non-cosmetic issues a person should encounter.  How much of it the insurance covers can vary, but everything should be covered.  The counter to this is that a company simply cannot cover certain illnesses and still be in business.  So how do we fix this issue?  In this case I think the government can help.  I just don’t see any other way to solve this problem besides including the government. The government would simply have a catastrophic fund.  A person and the insurance company could register a person’s illness, be it cancer or another very expensive illness, at which point all treatments for this illness can be subsidized.  Other rules would of course be needed but the primary purpose of handling high risk cases would be handled.

     The other problem is of course with pricing.  The price of an individual family getting health insurance can be daunting.  The local corporation does not pay that price for its employee’s coverage.  Why? Because it is buying so much that it has leverage to bring the price down.  John and Jane Doe can’t do this.  To solve this problem, coops are the answer.  These coops would be non-profit and run by a small group of individuals.  The coops would charge a nominal membership fee that would be pay for the people negotiating the rates. 

    The last problem is very simple to fix.  Although not outlined as a problem earlier it seems the simplest to fix.  All health insurance should be income tax deductible, both for the guy working for the corporation and the guy running a three person landscaping company.

    The alternative to all this is a government insurance system that when it is run poorly it will simply ask for more funding from the tax base.  The private companies without this access to taxpayer’s piggy bank will slowly disappear.  Each one that disappears will put more pressure on the government system and more pressure on the tax base.  Because let us not forget that billions of tax income come from the people in the insurance industry.  Each one of the insurance companies that goes out of business means thousands of call center reps, secretaries, IT workers, and managers.  The great majority of these people are not different then me or you.  Although some executive loses his job and multi-million dollar salary, many more Joe Six-Packs are standing next to him at the unemployment line.

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  • Stop Taxing The Corporations

    Posted on June 6, 2009 by drinker

    I know that it makes people feel so much better when they can go after the rich corporate fat cats.  Of course it all turns to tears when they realize the rich fat cat was the one who was paying their salaries.  Even microsoft is threatening to move jobs overseas.

    When are people going to learn that if you eat the golden goose it won’t lay any more eggs.  But it makes a bunch of short-sighted people feel better.  Everyone who works for corporations please raise your hand.  Ok that is just about everyone who still has a job.  And everyone who works at a school raise your hands too.  The corporations give educational institutions a lot of money.  So in a way you too work for the corporations.

    I believe that corporate income taxes are simply counter productive.  The reason being is simple, when you have corporation the corporation has to employ people.  When people are employed by a private company then the state does not need to pay them to not come after the government with pitchforks. 

    Employment for the average person has a lot of advantages both for the person but also for the government.  When a person is working they are less likely commit crime, protest in the street, and in general are just so much less annoying for the government.  After all if someone is home all day watching TV, surfing the internet, or just hanging around they so much more likely to start causing trouble.  This just requires more police, fireman, and morgue employees.

    Employment is not just good for the government either it is also good for the person doing the work.  Let us assume the person doing the work at least believes that what they are doing is meaningful to someone (which is one the failures of communism more on this in a later post).  So the person has a job that they believe is doing some type of good, they don’t have wake up in the morning thinking they have the greatest job in the world for this to work either.  Said person has a purpose to their life.  They feel that they have some form of control.  In addition they have a strong separation between free time and work time.  This is very important as someone who either works all the time is burden to themselves, and a person who plays all the time is burden to everyone else.

    Now that we have established that employment of people is a good thing we can also establish that we need something to employ them.  Well that is where corporations come into play.  Unlike small businesses (which are just smaller corporations), corporations have to employ a lot of low skilled specialists, in addition the usual skilled specialists.  These types of low skilled specialists must be drawn from the local population.  These are positions like mail room clerks,  janitors, the random copy and printer lady, computer helpdesk people (these are little more skilled), and we can’t forget the random hottie that always ends up at the front desk to greet people.  We all know that she is not going to be climbing the corporate ladder, maybe the corporate pole, but not the ladder.

    See all these positions must be filled by the local population of the corporate office.  And when the government makes it very hard to do business and make a profit the corporation will move its offices.  There are plenty of countries in the world who would be more than happy to have these corporations put their shell headquarters in their country. 

    Given all the bonuses I have outlined about the employment opportunities of keeping corporations happy why piss them off with higher taxes?  Because some left wing nut bags who can’t see the end result of their own jealously leads them to?

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  • Government Mismanagement and Corruption

    Posted on April 21, 2009 by drinker

     

    Well it seems that there is a report out that the TARP program could be mismanaged and is open to corruption.  In other news water is wet and Lindsey Lohan is unstable. 

    Did anyone seriously think that when the 700 billion dollar number came out that is was going to be spent wisely?   I thought it was joke when I first heard it, a bad one but still a joke.  It turned out that it was a joke on us.  To top it off a few months later we get a gigantic stimulus bill that will also have to be paid for.  Then the regular budget of the government will run into numbers unthinkable.  Who the hell is going to pay for all this?  We are.  The rich will pay for it directly while the poor will pay by inflation.

    This whole debacle is just another in a long list of examples of government mismanagement of money.  This not just an American problem, all governments have the same problem.  It has to do with a combination of human conditions.  Greed and Sloth are the most prevalent.  Greed in that the various representatives want to get the money to pay back constituents and their own pockets.  Sloth in the bureaucrats and the elected reps in ensuring the money is spent after due diligence.  The reason they can do all of this is that it is not their money, it is ours.

    I really thought I had more to write on this, but so much of it is too obvious.

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  • We are all rich when we are all poor

    Posted on March 30, 2009 by drinker

    What fascinates the hell out of me is that some very smart people do not understand that not everyone can be rich.  Nor can everyone be poor either.  We are rich or we are poor based on the people around us.  Both Ted Rall and Cynthia Tucker do not understand how basic everyday economics work.

    Although both are correct in criticizing the executive pay of these failing institutions, what they fail to recognize is aside from pulling back a little bit on the pay for CEO’s there will always be both wealthy, rich, poor, and a bunch of levels in the middle.  I also made a very conscience decision putting in both wealthy and rich as different levels. 

    To the primary reason I wanted to post about tonight.  The amount of middle class people has not changed in percentage of the population.   The primary reason has nothing to do with economic policies or anything that complicated.  The middle class are the people who make more than the lower class but less than the rich.  The factory workers were never really middle class.  The manager at the plant was middle class and the diner owner was middle class.  Could the factory worker live comfortably with the two point five kids and a white picket fence?  Maybe it really depended on the supply of houses with white picket fences.  But that is my point.  What does the average person today have in comparison to thirty years ago?

    Today the average household owns two cars (with reliability and features Mercedes Benz did not have), a HDTV in one or two rooms, air conditioning in almost every room, cell phones, cable TV with 100 plus channels, a computer with internet, some type of game system, and health care that those in the 1970s could only dream of (even if it’s expensive).   

    Mean while in the 1970s when according to Cynthia Tucker all was great, the average American made car was complete junk, went 0-60 in 3.4 months, got about 15mpg, and were good for about 80K miles.  Air conditioning was something only the rich people in the neighborhood had.  A house might have two TVs only one worked.  Cable was something for rich people also, if they even had it all.  There were no cells phones.  Ok that last one is bonus.  The personal computer was just a series of blinking lights.  Geeks really were geeks.  The internet was for even bigger geeks.  And healthcare although cheap was abysmal by today’s standards. 

    So where did all the productivity gains that the rich people ran away with go? It came back to the “poor people” in the form of better stuff for “poor people”.   One can argue that all the stuff is not worth it, but when it comes to economics the stuff and the services that people can have does matter.  Also if someone did not want the stuff they do not need to purchase the items.  

    The second point I want to make is directly related to the statistic mentioned in Cynthia’s editorial.  I don’t think there is anything wrong with it.  I think it actually shows exactly what it should show.

    A few years ago, Earl Wysong of Indiana University and two colleagues published a study on social mobility in this country. As outlined in the Economist, a right-leaning British news magazine, they “compared the incomes of 2,749 father-and-son pairs from 1979 to 1998 and found that few sons had moved up the class ladder. Nearly 70 percent of the sons in 1998 had remained at the same level or were doing worse than their fathers in 1979. The greatest social mobility occurred in those families already at the top of the income ladder,” the magazine reported.

     

    So 70 percent of the study did not move up the income ladder?  No kidding.  Not everyone can move up the income ladder since they have to move past someone else and then that person would move down the income ladder.   I would bet the statistics would come out that 1/3 moved up, 1/3 stayed the same and 1/3 went down.  Also 66% is really close to “almost 70%”. 

    The second part of the statement deals with that most of the social mobility was in the upper income brackets.  This too can be easily explained without it coming down to something evil republicans did by reducing taxes.  In 1979 a college degree was still a premium and those with them came from more affluent backgrounds.  While a high school education pre 1979 may have been good enough, after that is simply was not good enough.  One needed to have something besides a high school education.  So simply showing that those who were affluent made better gains was primarily because they had access to a college education and valued it earlier.  In addition it tends to the children of the rich that become the wealthy.  The grandchildren become drug addicts and home move porn stars.  So it sort of works out in the end.

    Did some people become obscenely rich, while others were brushed to the wayside?  Yes.  Do I wish that people could live in a minimal of comfort even when they are on the lowest rungs of the economic ladder?  Yes.  And they do, but in comparison to the truly poor in this world they are doing pretty damn good, even if everyone else around them is doing better.

     

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  • How to piss off the Europeans

    Posted on March 18, 2009 by drinker

    I can’t think of better way to piss of the Europeans then to start universal health insurance in the United States.  I say why should we be paying for all the research and development costs of new procedures while they can just leach off of our hard earned money.  Not to mention all of the European firms that spend all that money on research and development of new drugs can save that money. 

    The overpriced system in the United States allows for the socialized mendicene states to survive.  The new treatments are created so that they can be done in united states where they can charge and arm and a leg to fix your arm or leg.  Once the initial treatment is perfected and the initial investment is recouped the rest of the world can now benefit from it.  Pharmacutical companies will end up being the biggest losers in this new plan.  Primarly because the jackpot they get when they invent the next viagra will be eliminated.  But that also means that no one will invest to invent the next viagra. 

    This brings me to one of my primary principles of life.  No risk no reward.  No reward no risk.  Talent will follow the money.  I can’t think of another cliche but you get he point.  The top researcher or two may do it for the love of the task but there are about another hundred people in the chain that are not doing their job for the love of it.  These include other researchers, book keepers, IT guys, janitors, and general managers.  Without these jobs being done the researchers can not do their job.  All of these other people want to get paid, because at the end of the day they want to take their money and do something or someone they enjoy.

    So now that nobody can hit the jackpot by inventing the next great thing in medicine, the research and development will dryup.  Sure the charity money will still be their but the private money will slowly leave the market.  It will be replace by government research money which will be determined by the amount pictures showing hookers with the congressmen then the actual use of the end product.  Ironicly the amout of hookers and congressmen pictures is inversely proportional to the price of viagra.

    Smokem if you got em.  Mind as well look cool

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  • Ted Rall is officially a Communist

    Posted on March 10, 2009 by drinker

    Insulting CEOs (while letting them keep their perquisites) may be fun. But it doesn’t begin to address what’s killing the U.S. economy: the rancid notion that one person’s hard day’s work deserves more pay than another’s.

    Ted Rall for those who don’t know is a writer who is left of, well everybody come to think of it.  The primary premise for this editorial is that the CEOs of these failed banks should be tarred and feathered and that is something we agree on.  But after that we differ on just about everything else.

    I don’t like CEOs who get paid enormous amounts of money and run the company into the ground.  I believe in rewarding success and not failure.  But I firmly believe that some people should have more than others, if they deserve it because of their efforts.   I also think that the only person who can get someone out of crappy financial situation is themselves. 

    First we must recognize people are not poor because of the money they have or don’t have.  They are poor because someone else has more money.  Poor and Rich are both relative.  Always remember that.  Even in the height of communist Russia there was still rich and poor. 

    “In 1980, according to a Forbes magazine study, executive compensation was 40 times the average worker’s pay; by 2007, that had soared to more than 400 times,” CBS News reported on February 25th. Now that the companies those ridiculously compensated executives were charged with running are tanking, CEO pay is coming under attack by pundits and politicians.

    So what does this mean to the average employee?  Let’s say the average employee makes 50K a year and that there are 100000 employees in the company.  How much would it matter to each employee if the difference between 40 and 400 times was distributed evenly between those employees?  50K a year multiplied by 40 is 2 million.  Then 50K multiplied by 400 is 20million.  This yields a difference of 18million.  But what does that mean to the 100K employees; about 180 bucks a piece.  What would this have done to the average employee’s bills, something between diddly and squat. 

    I want people to know that I do not think they deserve to get paid if the company goes down the toilet.  They should be the last ones paid but when they do well they should be richly compensated.  But the current compensation scheme is out of whack.  I would like to see a limit on salaries.  Before you call me a hypocrite I think there should be additional types of compensation.  Their money should come from bonuses and shares of stock in the company.  The bonuses would be paid at the end of the fiscal year based on the net profit of the company while the stock would be rewarded to the CEOs but it could not be sold for 2 years. 

    This brings me back to my primary purpose of my post.  People should get paid what their days worth of work is worth.  I am sorry that the best someone can do is ask “do you want fries with that” but why should that person get the same as someone repairing an electrical circuit on the top of telephone pole.  A job that is both hard and dangerous.  Or perhaps someone guy making a decision that could destroy or rejuvenate the company.  I know that most left wingers believe that the CEOs of many companies are heartless pricks but in actuality they are human beings who care about their employees.  They might not be as caring as we would like but very few of them don’t sweat over laying people off. 

    Although there are still too many pricks out there.

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  • Funny Ad from Google

    Posted on February 10, 2009 by drinker

    One of the ads that google gave me when I was re-reading my post on the death of capitalism was on Socialism vs Communism.   I find it entertaining because the difference is simple.  Socialism is communism with sugar on top.  Its like argueing if its better to be stuck in the water with a bunch of tiger sharks or great white sharks. 

    In socialism the incrediably rich don’t have to change their name.  In communism they have register as part of the communist party.  Anyone not part of the super rich get screwed in either system.  Socialism will legislate the small guy out of business while communism just take it.

    And remember all big corporations started as small business.

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  • From Rich to Poor

    Posted on February 10, 2009 by drinker

     One of the unique things about America is that super rich families tend to fall from grace.  It usually takes about three generations.  This is because of the competive nature in which America generally works.  Sure family names stay around and old money is still there but even this old money doesn’t last forever.

     It usually starts with one member of the family who is smart, industrious, and most times a little morally repugnant.  This person builds an empire of oil refineries, hotels, movie studios, search engines, or whatever is the flavor of the generation.  This person works very hard to build something from nothing.  Their children see this hard work and eventually after their parent built up the business and they too have gone from something little to something great takes over the business.  The empire grows bigger and eventually starts running on auto-pilot this second generation have children.  But these children have always had everything.  They do not understand the struggles the previous two generations had to go through.  They too believe that life is a bunch of cherries and everything comes easy.  Without these struggles they are handicapped to take over the business.

     This third generation is usually where the hedonistic attitude begins.  Once this hedonism takes over it is quick fall from grace.  Drugs, Parties, Lots of Sex, and extravagant money is no object spending quickly depletes the family fortune.  Occasionally they have some kids that are not morons and keep it going longer but few of these families ever regain their former greatness.

     One great example of this is the Hiltons.  The Grandfather built the empire, his son kept it going and growing, and well Paris will destroy it if she can. 

     This shows that the economic theory of relativity holds another interesting consequence.  Because the third generation never saw what having little was like they have a very hard time imagining the struggles that were need to accomplish this.  They never truly appreciate what they have.

     I wanted to add one other thing about this third generation.  They also tend to be the ones that are more open to income redistribution.  I think this is because they feel guilty for having so much while others have so little, but it also because they did not see what it took to get there and the hard work of those before them.  Perhaps it is a sense of being overwhelmed that they could never build the empire bigger.  I am not sure.  After all I am just a guy blogging who hopes that my grandchildren have an empire to destroy.

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