Who Are These People?

August 29, 2012

As the camera panned the faces in the crowd at the Republican National Convention cheering New Jersey Governor Chris Christie’s speech promising austerity and shared sacrifice (really? if all the pain comes from reducing Medicare, Medicaid and Social Security benefits, food stamps, public employment, and public employee pensions while cutting taxes, what pain are those with reduced taxes — rich or otherwise — receiving?), I kept asking myself: Who are these people?

Even a cursory glance reveals there weren’t many minorities in the crowd. That’s typical for Republican conventions. But despite the presence of 15,000 journalists (five for every delegate), I have yet to read a single story that tells me how many of the delegates are teachers; how many are small business owners; how many are public employees; how many are elected officials; how many live in households earning over $250,000 a year; how many have kids; how many have kids in public schools. How do the demographics of this convention compared to Republican conventions past?

One issue cries out for analysis. Nearly a third of the membership of the National Education Association, the nation’s largest teachers union, votes Republican. Are any of them represented at the convention (there will certainly be a large contingent at the Democratic convention next week)? Do they agree with what Christie said about the GOP being for teachers but against their unions? Have they seen their union stand in the way of removing incompetent teachers, as was alleged? If so, have they quit their union? If not, why not?

There’s still a couple of days left. There’s still a chance to do some real reporting during this quadrennial exercise is political self-aggrandizement.

Medicare Double-Talk in GOP Platform

August 28, 2012

Dr. Aaron Carroll at the Incidental Economist blog captures the essence of the GOP platform on Medicare:

So Medicare will both stay a defined benefit program and be saved by no longer being a defined benefit program. We will eliminate the $700+ billion in savings to the trust fund, yet extend its life. We will not cut any benefits, but will reduce Medicare spending dramatically. We will increase Medicare spending, but somehow not seniors’ premiums.

BTW, the latest polls say Romney has pulled even with Obama on the issue of protecting Medicare. No doubt that’s due to his well-financed advertising charge that Obamacare “cut” $761 billion from the program. The fact is that it cuts $761 billion from PROVIDERS (health insurance companies and hospitals), and not a single service is cut. This is waste, pure and simple, which if put back into the system as Romney wants, will require a 20 percent co-pay on the part of beneficiaries ($150 billion or so more out of pocket). It will also reduce the time until the Medicare trust fund exhausts its reserves.

So here’s the rejoinder to anyone bamboozled by Romney’s ads: “What Obama did was cut $761 billion in WASTE from the system. Romney would give that money back to hospitals and insurance companies and have seniors make co-pays on that WASTE. Do you want to pay $150 billion more for WASTE?”

And if your conversationalist says, “yeah, but Obama is using the money to give insurance to ‘them’,” you can respond: “Well, at least you don’t have to pay extra for that; only the hospitals and insurance companies cough up. And if Romney gets his way, you’ll pay more, and nobody currently uninsured will even get covered. I’d say $150 billion out of your pocket is a pretty big price to pay to punish people without insurance.”

Medicare Mendacity on the Campaign Trail

August 23, 2012

To judge the level of mendacity in the campaign debate over Medicare reform, perhaps the best place to start is the recommendations offered by the Bowles-Simpson deficit commission in December 2010. Their proposal came five months after passage of the Affordable Care Act, a.k.a. Obamacare, and a few weeks after the mid-term elections when Republicans took control of the House of Representatives.

The deficit reduction plan, which won bipartisan though not unanimous support, did not see a need for a sweeping overhaul of the nation’s senior citizen health care program. Rather, it sought to build on the limits on Medicare spending growth contained in Obamacare – the $716 billion in “cuts” (actually reductions in projected spending increases) that are now being attacked in nationwide campaign ads by former Massachusetts Governor Mitt Romney. “We recommend requiring both the President and Congress to make recommendations whenever average cost growth has exceeded GDP (gross domestic product) plus one percent over the prior five years,” the report said.

Rep. Paul Ryan, R-Wis., a member of the commission and now the vice presidential pick on the Romney ticket, did not vote for that plan. He said limiting Medicare growth to GDP + 1% didn’t go far enough.

Instead, in April of last year he issued his own Medicare privatization plan as part of his “Path to Prosperity,” which passed the House with near unanimous support from Republicans and nary a Democratic vote. The premium support or voucher program would have in 2022 required all new Medicare beneficiaries to purchase plans from the insurance industry – up from the current 25 percent of beneficiaries who are now in Medicare Advantage plans. It would cut costs by limiting growth in the government’s contribution to seniors’ premiums to the consumer price index, i.e., zero growth in inflation-adjusted dollars.

Over time, that plan would dramatically shrink the government’s contribution to Medicare as a share of GDP and force seniors to pick up on average 61 percent of the cost of their health care, according to an analysis by the Congressional Budget Office. Estimates from the Center for Budget and Policy Priorities, which were based on that CBO report, claimed it would cost the average senior $6,400 a year, a number featured in President Obama’s campaign ads.

Neither camp sat still after their initial forays into Medicare reform, even though you wouldn’t know it from the campaign ads. President Obama last September issued his own deficit reduction plan, which upped the ante on limiting the annual growth in government Medicare spending to GDP + 0.5%. Curiously, the offer was condemned by deficit hawks as not going far enough even though its cuts exceeded Bowles-Simpson and were condemned by every provider group.

Ryan, meanwhile, has issued two more iterations of his Medicare premium support plan. The first, offered last December with Democratic Sen. Ron Wyden of Oregon, completely backtracked from his initial radical proposal. While it still called for Medicare vouchers, it allowed the government support for the program to grow at GDP + 1% — just like Obamacare. It also called for the private plans to be sold through state-based insurance exchanges, even though Ryan would eliminate those exchanges for people of working age without employer-provided insurance.

Then, in April of this year, Ryan flip-flopped again. Read more »

Spending Unleashed by Citizens United Leans Right

August 21, 2012

Conservative groups and the Republican candidates they support continue to be the big winners from a surge in independent campaign contributions unleashed by the 2010 Citizens United decision, a new analysis of Federal Election Commission data shows.

Through the end of June, conservative-leaning groups dominated the top 15 so-called Super PACs , which can now take in unlimited amounts of campaign cash from individuals and corporations to spend on specific campaigns as long as they don’t coordinate with the candidates. They outraised their liberal counterparts by a three-to-one margin, according to data compiled by MapLight, a California-based watchdog group.

Topping the list was Restore Our Future, a Super PAC set up by Republican campaign operatives with close ties to presumptive nominee Mitt Romney. The group has raised $81.2 million, according to the latest filings, which is nearly four times the $20.9 million raised by Priorities USA, the group that is working to boost President Obama’s reelection bid.

American Crossroads, whose top advisors include Republican heavyweights Karl Rove and Haley Barbour, is the second leading money-raiser among Super PACs having raked in $40 million through the end of June. Winning Our Future, which early in the campaign boosted Newt Gingrich’s candidacy, ranked third with $23.3 million raised. Read more »

The Medicare Upcoding Hustle

August 17, 2012

Add “upcoding” to the long list of perverse incentives created by fee-for-service medicine that are undermining efforts at controlling health care costs in this country.

The latest example came to light this week in a front page New York Times exposé of billing practices at HCA, the Florida-based chain of 163 for-profit hospitals. In 2008, the company introduced a new coding and billing system that over the two years that tripled the share of emergency room visits that received the two highest reimbursement rates paid by Medicare.

In other words, almost overnight, people visiting its emergency rooms got a lot sicker. Numerous government reports and whistleblower lawsuits refer to the practice as upcoding. In 2000 HCA paid $840 million – at the time the largest payment for alleged fraud in U.S. history – to settle claims it had overcharged Medicare for upcoding pneumonia patients.While the story focused on one highly visible chain – HCA was founded by relatives of former Senator Bill Frist of Tennessee, was once run by Florida Governor Rick Scott and is currently partly owned by Bain Capital, Mitt Romney’s former firm – the data in the story suggest HCA was hardly alone. Over those same two years, which coincided with an economic slump that curtailed rapid growth in health care spending, the percentage of emergency room patients receiving Medicare’s top two billing codes went from 58 percent to 74 percent – just two percentage points less than at HCA.

A company spokesman told The Times HCA was aware that it might be putting too many patients in the higher paying categories. So it adjusted its coding to, as the paper put it, “bring the company in line with the national average.”

Upcoding in HCA’s emergency rooms appears typical of what takes place in many corners of U.S. medicine whenever final fees depend billable services after a diagnosis. Since a more serious diagnosis allows hospitals and other providers to deploy a greater number of more costly services, the system creates a powerful incentive for providers, especially those that operate as for-profit businesses, to shift patients into those sicker categories.

“This is another example of how the way we pay for medical care is very vulnerable to profit maximization by providers,” said Paul Ginsburg, president of the Center for Studying Health System Change. “It’s a fee-for-service issue.”

The problem appears to be worse at for-profit providers. Read more »

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