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POLICY: Edwards meets Schwarzeneger & uses T word– NFIB flips out

I was at a conference on Saturday when the Asst Sec of HHS in California and the former sec of HHS in Massachusetts managed to twist their tongues around how they were getting to mandates, with shared responsibility, provider contributions, employers cost-sharing, blah blah blah—and never a mention of a thing starting with T and ending with an ax.

John Edwards has decided to be brave and say that he can insure the uninsured with just that—a tax raise. Brave man. Foolhardy, perhaps! Especially as there’s plenty of money in the system now to do it—with just a little bit of redistribution (which Schwarzenegger is also pointing out).

At any rate the vaunted National Federation of Independent Business is out with its head firmly stuck up its rear. So perhaps he’s doing something right.

The National Federation of Independent Business, a powerful lobby that represents small-business owners, said such mandates amounted to a job-killing tax on small companies. “Health care mandates are a nonstarter for our members,” said Stephanie Cathcart, a spokeswoman for the federation.

I’ve said in polite terms what I think about the NFIB’s logic over at Spot-on a while back. Basically their members just can’t add up.

So now it’s time to be a little more direct. The best way to do this is perhaps to let you in on a little email chat with one of their number who thought that I would support his quest to get the Shaddeg bill into law. Clearly not a man who knows his audience. Here goes:

From: Ragley, Jay [mailto:Jay.Ragley@nfib.org] Sent: Wednesday, December 20, 2006 1:23 PMTo: tips@thehealthcareblog.comSubject: Small Business Health Insurance EditorialTo Whom It May Concern at The Health Care Blog:

I don’t know if you link to published editorials, but I would submit the following editorial on some ideas our organization and our members are beginning to suggest in South Carolina.  If you choose to link it, I appreciate it and if not, I appreciate your consideration.

(Link to pro-AHP/Shaddeg bill article, which I didn’t link to—surprise surprise—whatever Eric Novack would like me to do!)

Jay W. Ragley

State DirectorNFIB/South Carolina

So I wrote back:

From: Matthew Holt [mailto:matthew@matthewholt.net] Sent: Wed 12/20/2006 4:59 PM To: Ragley, Jay Cc: Subject: RE: Small Business Health Insurance Editorial

Jay

You’re kidding right? Have you ever read THCB? I think that the NFIB is so, so dumb about this issue that it’s unbelievable. NFIB members offering health insurance are the group that would benefit the MOST from a national health insurance single payer scheme, and yet you insist on getting behind ridiculous solutions that make matters worse and will continue the cost escalation with no controls that cause the problem.

I’ve written about this here http://www.spot-on.com/archives/holt/2006/05/small_businesses_that_cant_do.html#more and I’m not going to berate you further. but I do invite you to respond to my basic assessment of why your position is so wrong for your own members.

 

All the best
Matthew

To which he gamely responded.

From: Ragley, Jay [mailto:Jay.Ragley@nfib.org] Sent: Wednesday, December 20, 2006 4:12 PMTo: matthew@matthewholt.netSubject: RE: Small Business Health Insurance Editorial

Matthew:

 

Thanks for your response.  I did read some of your blog but obviously not enough.  I’m new to NFIB and have been trying to work more with bloggers as most of the MSM don’t care about small business issues.  I’m not aware of any health insurance blogs in South Carolina (mostly political ones down here).

 

I did read the blog posting you sent me and I hope you understand how NFIB determines its public policy positions.  We send ballots to our members throughout the year on a variety of issues.  So, when NFIB supports repealing the death tax, it’s because a strong majority of our members (not a 51% majority) support that position.  So believe it or not, it is the small business membership of NFIB that determines our public policy positions.

 

But as far as a single-payer system, I will ask the same question I asked folks when I worked in DC.  As a supporter of single-payer system, can you claim with any degree of confidence that a government-run health insurance system will not bankrupt the government, the economy or both as we know it in the USA?  Whatever tax you choose to impose to pay for this system will, in all likelihood, lead to lower economic growth, which will lead to lower tax revenues and thus produce deficits, assuming that all other government spending is held constant (a big assumption given the recent spending increases in many government programs besides health care).  So the economy will sour to a degree, the treasury will collect less revenue and the government will have to a) borrow b) cut spending c) raise taxes again.  Seems to me the most likely scenario is raise taxes, which will only exacerbate the problem.  There is no free lunch.

 

So unless the single-payer crowd can find a way to not wreck the federal budget and the world’s most dynamic economy, my members will keep telling me to find free-market solutions.  They’re risk takers and would rather have the opportunity to grow at the best rate possible.I guess small business owners aren’t happy with a Japan-like growth rate; they want the opportunity to grow at any rate they desire and create for themselves, business, employees and family.

By now of course I’m getting a little feisty on that basic math question:

 

From: Matthew Holt [mailto:matthew@matthewholt.net] Sent: Wed 12/20/2006 6:34 PM To: Ragley, Jay  Subject:RE: Small Business Health Insurance Editorial

I understand that you represent your members and that their policies are what you follow. I would also humbly ask how many of your members know what share of GDP is spent on health care here versus Japan, Korea, Taiwan, Germany, France et al…you know the answer. Those countries spend virtually 50% the amount we do on health care. So you explain to me how spending 50% less on something bankrupts us faster than spending at our current rate (and our faster growth rates).

If government imposes a tax to pay for health care, but at the same time removes the cost of providing health care from business, how does that hurt business? It’s a revenue neutral move. And more importantly in the long run the example of all those other countries is that government (or some proxy for it) has a much better shot at controlling health care costs because the taxpayer realizes the correlation between increasing costs and their taxes going up. But in this country we don’t bother making that equation, and so we keep paying more and more for health care.

But I guess if you pay money to a private insurance company that incidentally keeps 15-25% of your money in its pocket for doing not much, then that’s not a tax–so it’s OK to spend money on health care that way. But I get very confused when you tell me other countries are "going bankrupt" when they are containing spending much better than us, because they are using the government rather than an ineffective insurance sector to control spending. Are you telling me that if they spent at our rates of GDP they would be better off?

And BTW whatever you believe about the Laffer curve, you may have noticed that taxes going down can also lead to huge government deficits. Or were you not paying attention for the last 5 years?
Matthew

To which, like a true booty-mercantilist, he resorted by appealing to my own best interests!

From: Ragley, Jay [mailto:Jay.Ragley@nfib.org] Sent: Wednesday, December 20, 2006 4:51 PMTo: matthew@matthewholt.netSubject: RE: Small Business Health Insurance Editorial

Matthew:
 
Lots to digest here but not enough time tonight for a response.  Will get back to you.  Although I have to wonder, wouldn’t your consultant company go out of business with a government health insurance system?  I mean, you would have to get a job with the government I guess.
 
JWR

And I’m afraid I went for the non-technical KO:

From: Matthew Holt [mailto:matthew@matthewholt.net] Sent: Wednesday, December 20, 2006 4:55 PMTo: ‘Ragley, Jay’Subject: RE: Small Business Health Insurance EditorialSo is it about doing the right thing, or hanging on to my business at any cost? Sounds like a paper-pushing unionized bureaucrat’s view to me!

And don’t worry–there are LOTS of people for whom a single payer system WOULD be very bad news (Insurers, drug cos, many doctors, many hospitals, etc) I just don’t think that small businesses can be counted amongst them!

Matthew

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RyanLeonard WashingtonDavid HogbergNDDB-2NDDB Recent comment authors
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Ryan
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Ryan

There are three rarely mentioned reasons as to why Americans pays more per person for healthcare than socialized countries. Sadly, may of our increased cost are because the rest of the world is socialized. 1 Drugs. Ever wonder why much of the worlds drug companied are in the USA? The rest of the socialized world has price controls on medicine. So when the drug companies need a billion dollars to develop a new life saving drug they charge the American healthcare system. This causes a two-fold difference when comparing American healthcare costs to the rest of the world. Basically American… Read more »

NDDB
Guest

David Hogberg, I read your article, and I’m not sure I agree, although it is interesting. For instance, take this section : “Life expectancy is a poor statistic for determining the efficacy of a health care system because it fails the first criterion of assuming interaction with the health care system. For example, open any newspaper and, chances are, there are stories about people who die “in their sleep,” in a car accident or of some medical ailment before an ambulance ever arrives. If an individual dies with no interaction with the health care system, then his death tells us… Read more »

NDDB
Guest

David, Does the WHO and all the other organizations that gather this data not know those facts? Are you telling me they just take statistics at face value and can’t compensate for the, -apparent-, common knowledge that France and Belgium are fudging their infant mortality rate stats? This is all very amusing, since seems like it’s going to be a big part of moore’s new propaganda piece “sickos.” I’m glad the health care system is getting attention, but I’m not glad it’s from him. Sometimes I think he’s working for Bush and crew. What a way to devalue a point… Read more »

Leonard Washington
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Leonard Washington

WE’RE THE GOVERNMENT & HERE TO HELP I’m from a family of small business people. Yes, of course — having monoliths to concentrate financial risk such as Microsoft and the federal government makes absolutely 100% sense. Like Airbus 380! As for the health care plans in Taiwan, Japan, South Korea, et al. — great! All we have to do, is become like them culturally. Which will take only about, say, 50 years. The current payer system is fracked. No one argues that. The challenge is not to make more of a mess, than is already in place. Relying on one… Read more »

David Hogberg
Guest

Well, let me enter the hornets’ nest here. In particular, let me address this comment by NDDB: “I still can’t believe you [Stuart Browning] don’t know infant mortality and avg life expectancy are indicators of a health of a nation, please… go here before you talk about the subject in public again.” Those two measures might be indicators of the “health of a nation,” but they are not indicators of a the quality of a health care system. I’ve given this a full treatment here , so let me make a few quick points. 1. Life expectancy is determined by… Read more »

NDDB
Guest

Stuart, I’m almost out of patience-power, and I know that if I point to any statistic from the UN, WHO, Red Cross… etc, you’ll just dismiss it saying “liberals” “crazy commies with their biased media”. Whatever.. it really doesn’t matter, you haven’t proven anything I need to disprove. So that’s #1 & #3. As to your questions 2 : http://www.google.com/search?hl=en&q=infant+mortality+rates+as+indicator&btnG=Google+Search Honestly, why should I have to do that for you? “A society’s infant mortality rate is considered an important indicator of its health status,” http://www.ncbi.nlm.nih.gov/entrez/query.fcgi?cmd=Retrieve&db=PubMed&dopt=Abstract&list_uids=12700217 Like I said, we are not Canada, not all single-payer systems are the same. But… Read more »

NDDB-2
Guest

Ok – I am new to this discussion but already I disagree and / or take outright offense at several of the assumptions that are being made in this discussion – on both sides of the argument. The one issue that effects me emotionally as well as intellectually is the assumption that the orthopedic patients, who are maintained on pain meds while they wait for their surgeries, are “addicts”. This is hardly the case and using emotional and stigmatizing labels (by creating images with words of our grandmas and grandpas wandering around dark alleys looking for a fix) to inflames… Read more »

Stuart Browning
Guest

NDDB,
You’ve got to be kidding. I’m almost out of battery power on my laptop – but just let me ask three questions:
1. What rankings are you referring to?
2. Do you really believe that infant mortality rates are even a remotely reasonable proxy for the quality of a health care system?
3. Do you really believe the propaganda out of Cuba – a totalitarian state with no free press?
Canada is very relevant. It’s a pure single-payer – and that’s what being advocated here in the US.

NDDB
Guest

Stuart, Here’s an interesting fact : This is not Canada. No where has anyone said “let’s try to mirror Canada’s healthcare system, with all it’s flaws as well!” Let’s try to build a better healthcare system. If you did some research, you’d see that some of the countries that are ranked as having the best healthcare in the world have nationalized healthcare. So, pulling out inconsequential anecdotes from one country doesn’t prove anything. It doesn’t carry 1/100th of the weight you seem to think it does. In fact, Cuba has a lower infant mortality rate than the US, which is… Read more »

Stuart Browning
Guest

jd – So, reporting the words of a Canadian physician is spreading rumors?
Well here’s another “rumor” straight from a Canadian surgeon: some hospitals there have instituted “disruptive physician” policies that allow hospital administrators to arbitrarily punish doctors who speak out about the shortages and rationing by cutting their already insufficient OR time.
But I guess the doctor is obviously a psychopath, huh, jd?

Eric Novack
Guest

Peter– one more comment here… and, as always, I speak (write?) only for myself. At the risk of being repetitively repetitious, there is agreement on both sides as to the unsustainability of the current healthcare spending ‘trajectory’. I argue every day for changes and ideas that I believe will move the US system toward one that will be around for (1) my career, (2) my family’s health problems. I would easily say that in a system with the changes that I have recommended over the last 2 years, many doctors would make less; most insurance companies would make less; some… Read more »

jd
Guest
jd

Stuart, It may surprise you that I’ve actually spent time looking into the systems of other nations. The primary reason that I’ve done this is to understand how they could cover everyone at half the cost of our system which leaves out a chunk of the population, while keeping quality (on the whole) about the same. What I’ve discovered is that every nation has its own system, and there are enormous differences between them on almost any metric you like, except one: cost. They get the job done for far less money than we do. I’ve also learned that the… Read more »

NDDB
Guest

Matthew,
Very nice, too bad the guy didn’t seem to understand a word of what you said.
This is an interesting site : http://www.pnhp.org/
Physicians for a national health program – basically physicians who are FOR a single payer system, so perhaps they don’t feel it will hurt them either.

Fred
Guest
Fred

Matthew, Only one slight problem with moving health care to single payer government system and expecting to cut costs 50%. All of the entities now playing in this arena own the legislative process. Once all the money comes from the government bank, they will ensure through their lobbying that they get their “fair share.” And I’m certain that rather than seeing costs at 1/2 of previous expenditures as with other countries, we’ll see it rapidly double. But remember its all for the patient anyhow!!! At least thats what I keep hearing. The operating system must be totally reformed before we… Read more »

Peter
Guest
Peter

So Stuart, take away subsidzed apartments in Miami and the wait for housing goes away, take subsidzed medical care away from citizens and the wait times for ER goes away – eureka!