Categories

Tag: Congress

Health Care Reform Coming Out of Senate Finance?

We’ve been getting lots of news these past few days leading to optimism that a bipartisan health care bill will soon emerge from discussions between the “Coalition of the Willing.” That term refers to the three Republicans and three Democrats trying to find common ground in the Senate Finance Committee.First, let me be clear that I have the greatest respect for Senators Baucus and Grassley and their four colleagues. Theirs is the kind of bipartisan approach that all of Washington, DC should be following on any number of issues.And, as I have posted here before, I am concerned that in their efforts to find compromise they are headed for a health care bill that is based on a formula of cost containment “lite,” minor paring of Medicare and Medicaid provider payments, and at least $500 billion in new taxes. I don’t see much changing fiscally if that is the final result in a health care system that is already unsustainable and on the way to spending upwards of $35 trillion to $40 trillion over the next ten years as it goes to 22% of GDP by 2018.From what we have heard, their bill would hardly "bend" any curves.

Continue reading…

Op-Ed: Sustainable Healthcare Reform

President Obama made a risky wager when he decided to let Congress take the lead on crafting health care legislation, rather than presenting his own reform package. Congress is not known for taking bold, decisive leadership on tough issues. Normally, it reacts and gridlocks; it doesn’t lead.

As Congress takes its usual August recess without acting, it appears that Obama’s strategy has failed. But, has it? Is there a deeper strategy? What’s really at stake here?

Obama reportedly reasoned that Congress will do better in the long-run if it protects its institutional prerogative as law maker and doesn’t take on the appearance of being the President’s rubber stamp. This is a plausible calculation. The last time Congress was asked to respond to a President’s health care reform proposal during the Clinton years it did so by throwing the whole package in the trash can.Continue reading…

Speculators Bet Reform Won’t Hurt Industry

Uscapitolindaylight

Speculators seem to be betting that a watered down health insurance reform bill won’t hurt health insurers, hospitals, drug makers or medical device and supply manufacturers.

Stocks for almost all of these health sectors and for exchange trade funds that track health stock indexes turned higher last week. Why?

1. Congress is not going to get health bills through the Senate or the House in face of strong opposition by a minority of Democrats in both houses. This means opponents of the health insurance reform bills will have at least 45 days to convince members of Congress and the public that the bills favored by the president and his hard left supporters in Congress are a bad idea.

2. It is very unlikely that Congress will create a public option health plan, or Government HMO (Fannie Med). The votes aren’t there. This is a bit bullish for health insurers over the short term. White House talk about taxing insurers that offer gold plated health benefit plans makes no sense because few do. If such taxes were enacted, insurers would stop offering or administering such plans, and self-insured employers probably would drop them as long as union contracts didn’t lock them into such plans.

3. If the very liberal Coastal Democrats who lead Congress and most of the five commitees drafting health insurance legislation want to get the support of Democrats from Western, Midwestern and Southern states, they’ll have to up Medicare payments to providers in those states. This is bullish for hospital chains, which operate mostly in the fly-over states.

4. The Congressional Budget Office Saturday threw cold water on the idea of putting MedPac, a panel of self-interested health care and medical experts who would be subject to tremendous political pressure from Congress, in charge of deciding what insurers would cover and how much they would pay for procedures. The panel would save only $2 billion out of trillions over 10 years, the CBO guessed. And it was being generous to the idea that MedPac would save anything. This is good for drug and medical device makers, because it lessens the threat of new price and utilization controls on their products.

5. While www.intrade.com bettors think there’s at least a 46% chance that some kind of health insurance reform will be enacted before year end, the polls are showing Americans are increasingly opposing the bills before Congress. The politicians who created the laws and regulations that make Medicare, Medicaid, SCHIP and state and federal regulations of health insurance markets unworkable failures are promising to fix the health markets. They have less and less credibility every day.

6. Proposals to tax millionaires to pay for covering the uninsured and increasing benefits for others are in trouble, if not dead on arrival.  The economy’s in no shape to be stalled by tax hikes, and there appear to be enough Democrats opposed to the tax to stop it.

7. While the so-called Blue Dog Democrats are stalling health insurance reform for economic and ideological reasons, the Congressional Black Caucus has made it clear that it won’t support a bill that the Blue Dogs will support. Throw in the opposition by anti-abortionists who don’t want the legislation to use taxpayers money to pay for abortions, and you have a pretty complex political problem for President Obama, Sen. Majority Leader Harry Reid (D-NV) and Speaker Nancy Pelosi (D-CA). While the Speaker claimed Sunday that she has the votes to pass health insurance reform, few believe her.

Some Democrats are saying that drafting health insurance reform bills is 70% to 80% done and it won’t take long to get a bill. Other Democrats are saying they want to take the time to write good legislation. The question is, can the Democrats and a few Republicans resolve the last 20% to 30% of the issues that need to be agreed upon to get a bill? It doesn’t look very good for health insurance reform at the moment, but some kind of a bill may pass in the next year or so, if not this year. Presidents Reagan, Clinton and Bush II all enacted major health legislation in their third and later years in office. All three bills have been financial and health care disasters.

Charts for health insurers are here.

Charts for hospital chains are here.

Charts for drug makers are here.

Charts for medical device and supply makers are here.

Charts for long-term care stocks are here.

Chart for health stock exchange traded funds are here.

Click on a chart to see a gallery of charts for a stock or ETF. Disclosure: I own BDX and options on STJ.

Don Johnson blogs at The Business Word Inc. Between 1976 and 1986 he was editor of Modern Healthcare magazine. As its top editor, Don helped build Modern Healthcare, a Crain Communications Inc. publication, into the hospital industry’s leading business magazine and one of the top magazines in the country.

More by this author:

A Health Insurance Premium Tax Would be a Chicken Tax

The Congress has looked at taxing about everyone and everything to pay for half the cost of a health care bill.

They’ve considered sugary soft drinks, beer, “millionaires,” and “gold plated” health benefits to name a few. Every time they come up with one it gets shot down by the interests it would offend.First, as I have asked on this blog before, why do we need to use at least $500 billion in new taxes to pay for half the cost of a health care entitlement expansion bill? We will spend somewhere between $35 trillion and $40 trillion on health care in this country over the next ten years. Many experts contend there is as much as 30% waste in what we spend.Advocates of a health care bill say we need it to reduce the cost of health care in this country that will otherwise bankrupt us if we don’t fix it.

With as much as $10 trillion to $12 trillion in waste, and cost containment as the stated goal, why do we need to raise people’s taxes $500 billion to pay for an expansion of coverage?But since it is clear that the Congress and the White House have all but given up on real health care reform that would really “bend the curve” they are adamant they are going to raise taxes to pay for at least half the cost.

Continue reading…

Live from Aspen: the moderates’ view on Obama health reform

6a00d8341c909d53ef0105371fd47b970b-320wi Paul Krugman’s article today excoriates the Blue Dogs and a former dog Billy Tauzin in particular. He also (as I did a week or so back) wonders where the Dogs were when the Bush tax cuts were bumping the deficit more than the proposed health reform bill will and redistributing wealth from future poorer taxpayers to the very rich in the process.

Funnily enough I’ve been at the Aspen Health Forum where the self-same Billy Tauzin used his not inconsiderable Cajun charm and a dollop of PhRMA’s money to buy me (and a bunch of others) a whisky and a s’more on Saturday night, and took part in a couple of panels I watched on Sunday. We had a couple of brief chats, one about his cancer treatment and another about getting big Pharma to behave better. He claims some progress there (voluntary restrictions on DTC, better posting of clinical trial data, reductions in marketing excess to docs). I suggested that there was more progress required both in pricing policy and PR. He said it was hard, I told him that was why they paid him the big bucks.

Continue reading…

Health Reform and Obama’s Leadership

6a00d8341c909d53ef0115712a5173970c-100wi

By all accounts this is crunch time for President Obama on health care reform, and things couldn’t be more tenuous. In the past several weeks, we’ve seen unified Republican opposition to his ideas, a revolt against reform from leaders inside his own political party, and the head of the non-partisan Congressional Budget Office testifying that the only direction he is bending the cost curve in is sharply upward.

As a physician who supports the President’s vision to improve the quality, access and lower costs, I’ve been following this debate closely. I’ve also been wondering what the debate about health reform tells us about the President’s leadership style. While I see him continuing to communicate his vision eloquently, there are two key leadership qualities Obama seems to lack that may prevent him from achieving his goals for reform.

Continue reading…

Commentology

Anonymous

I'm retired now, but as a former lawyer, I simply must speak out in opposition to the various health care proposals that are being bandied about. It used to be said that what was good for GM was good for America. I submit that the more appropriate slogan in this day and age is that what's good for lawyers is good for America.

Right now the American system of health care proudly denies service to 40 to 50 million people, depending on your source. The great majority of them don't need health care anyway. Our system has always worked on the free market ideal that if you have what it takes, you'll achieve your goals. If you don't, then you can fall by the wayside. This philosophy has made this country great for over two centuries. Why change it now?

Continue reading…

Can HR 3200 Be Fixed?

Health care reform looks like it’s stalled. And rightly so, based on the provisions of the House Democrats’ health care reform bill. The grossly misnamed America’s Affordable Health Choices Act (HR 3200) combines the worst of all possible worlds: high taxpayer costs, big increases in federal deficits, and disincentives for businesses to hire, while leaving up to twenty million individuals still uninsured and doing little or nothing to control runaway national health care expenditures.

Although the bill would make health care coverage available to many of the millions who currently cannot afford it, its provisions will potentially add some $200 billion a year to federal expenditures, make only miniscule reductions in Medicare cost trends, and impose play-or-pay provisions and a new surtax that could hurt smaller businesses just as they try to recover from the recession.

So, is there anything that can be done to fix HR 3200 so that it would provide affordable universal health care coverage without increasing federal deficits or halting the recovery from the recession?

Continue reading…

Rantology: Sympathy for the blue devils?

6a00d8341c909d53ef0105371fd47b970b-320wi I do have some vague sympathy for the Blue Dogs, the group of mostly red-state Democrats who have to pretend that they care about fiscal responsibility. They, like me, think that we shouldn’t be increasing taxes on the non-health sector to pay for universal coverage. Unlike me they think that we should be reducing any commitment to universal coverage by reducing the level at which subsidies for people mandated to buy health care coverage cut off—which will leave us in a situation with lots of people who forgo coverage because they can’t afford it. I of course think that we should be finding the money to cover the uninsured from within the 16% of GDP we already spend on health care and then ratchet that overall number down, but then again I don’t have to get elected to Congress.

But I do have one modest question. Where were the dogs/devils’ concerns about the deficit when George Bush was borrowing for the future to pay for income and dividend tax rebates for the very wealthy, by invading Iraq and hiding the accounting, and by creating the boondoggle that was the Medicare Modernization Act. Now it’s late at night and I’m not going to go chasing voting records from 2001–3. But I sure have my guess….

More on the politics of health care reform:

Op-Ed: Reform- Why have our objectives been abandoned?

6a00d8341c909d53ef0112793e5fd128a4-pi

In the campaign of 2008 and the first six months of 2009, the call for healthcare reform has been a refreshing and important theme.  It has been widely recognized that

1.    Healthcare costs are out of control.  You cannot have healthcare expenses inflating at 8% in an economy that is growing in the best of times at 4%.  (today, the current inflation rate is negative 1.3%)

2.    47 million Americans need coverage

3.    14,000 Americans lose their insurance everyday

4.    Medicare is in peril, and along with Medicaid, the combination of ever-increasing costs are the main drivers of this government’s budget deficits that threaten our economic future.Continue reading…

Registration

Forgotten Password?