Category Archives: Amusements

GOP ignores the Cadillac already in the garage

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Cadillac taxi?

The Wall Street Journal is a serious newspaper, so I had to laugh when I read GOP Senators weigh taxing employer health-plans. Apparently Senators are thinking about including a new tax in their Obamacare repeal bill in order to raise revenue, improve equity, and reduce the distorted incentives that divert taxable wages into non-taxable healthcare expenses.

We learn from the article that although it’s a solid policy idea and is being considered by many Republicans, “it could be politically risky, since it could expand the impact of GOP health proposals from Medicaid recipients and those who buy insurance on their own to the roughly 177 million people who get coverage through their employers.”

Republicans accused Obamacare opponents of not having read the Affordable Care Act before approving it in 2010. Seven years later it appears Republicans themselves haven’t read the law that they are now trying to overturn. If they did they would discover that Obamacare already includes this provision, an excise tax on high cost employer plans, nicknamed the Cadillac tax.

It’s far from perfect, but it’s not so bad either. It places a steep tax on corporate health spending above a certain high level, thus limiting the impact to the most serious cases, discouraging healthcare inflation, and phasing the tax in gradually.

So rather than wasting time discussing a new approach where consensus will be hard to forge, all the GOP has to do is leave the Cadillac tax in place. While they’re at it they might consider leaving the rest of the Obamacare in place, too, and working to improve the few areas that need a tune-up.

But I read the whole article in the print edition without finding any mention of the Cadillac tax. Someone must have pointed that out to the editor, because the online version tacked on two sentences at the end about it.

As I argued back in February (Can Congress agree on the Cadillac tax?) limiting the tax deductibility of employer sponsored health insurance is a good idea, but is opposed by a huge array of forces on the left and the right. I advocated then and am suggesting now, to leave the Cadillac tax in place.

By healthcare business consultant David E. Williams, president of Health Business Group.

What’s wrong with Trumpcare (so far)

 

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As a college student many years ago I had a summer internship at a top consulting firm, where I learned an important lesson from my boss: “Don’t come tell me about a problem without proposing a solution.” It went without saying that before speaking up I was expected to focus only on real problems, analyze the situation, and propose realistic, logically consistent solutions.

I’m reminded of this lesson pretty much whenever I hear Donald Trump say something, on subjects ranging from immigration to the environment to foreign policy. If he were a summer intern he would have been fired, and We the People should have known better than to hire him for his current gig.

Trump has no problem calling the Affordable Care Act (ACA) a “complete and total disaster” and saying everything should be thrown out the window and replaced with “something terrific.” But if you listen in recent days it’s become clear to me that Trump doesn’t even know what the Affordable Care Act includes. I’m sure if a reporter asked him to name five key elements of Obamacare he couldn’t do it, not that he could be bothered to try.

The things Trump says he wants to achieve are mainly in line with the objectives of the ACA itself. Furthermore, the ACA has achieved some or a lot of success in many of these areas. To the extent Trump has backed different approaches, they are either irrelevant, ineffectual, contradictory, or fiscally unsound.

Trump said in his speech to Congress that he wants to replace the ACA “with reforms that expand choice, increase access, lower costs, and at the same time, provide better healthcare.” He continued with talking points that he and Congressional Republicans have used in the past:

  • Allowing the sale of insurance across state lines –which unlike what Trump said, will not lead to a national market nor achieve the other goals. In any case, selling across state lines isn’t forbidden today but there’s little interest in it from health plans themselves because they would have to set up local networks and wouldn’t have leverage to negotiate with local providers. It’s just policy ideologues and ignoramuses who think this will work. (It also requires contradicting typical Republican views about states rights.)
  • Ensuring that people with pre-existing conditions have access to coverage is a cornerstone of Obamacare, and a successful one at that. So it isn’t something Trump or Republicans can take credit for and was never a GOP goal before the ACA. If we’re going to be pure about a full repeal of Obamacare, why leave this –and other popular provisions—in place?
  • “Giving our state governors the resources and flexibility they need with Medicaid to make sure no one is left out.” –Well if making sure no one is left out is the goal then the states should accept the Medicaid expansion. Shifting to block grants may provide flexibility but won’t add resources
  • The use of tax credits and Health Savings Accounts to allow individuals to buy plans of their choice (not ones “forced by the government”) is just fancy words. Tax credits would have the same objectives as the current subsidies for premiums and out-of-pocket costs but they would probably be less efficient. If the credits aren’t refundable and/or they are based on age but not income, it won’t help poor people buy insurance. And if people can buy whatever plan they want it will help young, healthy people who want bare bones coverage but will make insurance more expensive for everyone else. Already, Trump’s instructions to the IRS not to penalize people who don’t buy insurance is undermining the Obamacare exchanges rather than helping them
  • Malpractice reform. Sorry, that will have no meaningful impact
  • “Bring down the artificially high price of drugs and bring them down immediately” –No word on how that would be done, certainly not immediately.

It’s notable that none of these so-called principles actually deals with improving the delivery of healthcare. They’re all about insurance and financing.

He concluded “On this and so many other things, Democrats and Republicans should get together and unite for the good of our country and for the good of the American people.”

Amen to that. A good way to start would be for Trump and the rest of the GOP to apologize for demonizing and undermining the implementation of Obamacare and then work on improving it. With hardliners from the ironically named Freedom Caucus likely to oppose pragmatic policies, it’s up to the GOP to persuade Democrats why they should go along.

By healthcare business consultant David E. Williams, president of Health Business Group.

Promises promises

Post-election Donald Trump is making healthcare promises he can’t keep. Here’s the transcript of Trump’s 60 Minutes interview from Forbes.

Stahl: And there’s going to be a period if you repeal it and before you replace it, when millions of people could lose -– no?

Trump: No, we’re going to do it simultaneously. It’ll be just fine. We’re not going to have, like, a two-day period and we’re not going to have a two-year period where there’s nothing. It will be repealed and replaced. And we’ll know. And it’ll be great healthcare for much less money. So it’ll be better healthcare, much better, for less money. Not a bad combination.

I would love to see great healthcare, that’s much better, and costs much less. But Trump has no idea how to make that happen and neither do his advisors nor the Republicans in Congress. I wonder if they believe their own rhetoric or if they realize it’s BS.

In any case, now it’s their responsibly to deliver.


By healthcare business consultant David E. Williams, president of Health Business Group.

Goodbye Obamacare? More like hello single payer!

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Once Donald Trump enters office, Republicans will be in a good position to repeal Obamacare, something they have been foaming at the mouth to do for quite some time. Democrats might be able to filibuster to prevent an outright appeal, although the majority has other ways to gut the law, such as the reconciliation process.

I say let them go ahead and repeal Obamacare without putting up a big fight. As Trump told 60 Minutes, “I am going to take care of everybody. Everybody’s going to be taken care of much better than they’re taken care of now.” He also promised to provide “quality, reliable, affordable health care.”

I look forward to hearing the great ideas revealed by Trump and the Republicans in Congress. If they can do what they say then I’m entirely in favor of it and will give them the credit that’s due.

Meanwhile, I’m going to feel free to criticize the stock initiatives of the Republican party, which were largely mirrored in Trump’s campaign statements:

  • Repeal Obamacare, by which they really mean keeping the popular pieces like making health plans accept members with pre-existing conditions without charging higher premiums, but at the same time jettisoning the unpleasant aspects such as the individual mandate and taxes that help subsidize coverage. Sounds nice, but without a mandate, plans will suffer from adverse selection, premiums will skyrocket, and people will be left uninsured
  • Let health plans sell insurance across state lines. This one is highly touted but in reality it’s a big yawn. The plans themselves have little appetite for moving across borders and even if they did, most new entrants won’t be able to establish strong enough negotiating positions in the markets to bring down premiums
  • Change Medicaid to block grants so states can do what they want with the money. This isn’t a terrible idea because it could allow states to more freely innovate and tailor Medicaid to meet local needs. In practice it’s likely to be used just as a way to screw the poor
  • Promote drug re-importation. Remember the senior citizen buses to Canada in the 1990s before Medicare Part D and the mail order pharmacies with drugs supposedly from Canada, that disappeared once Obamacare required drug coverage? Well, the GOP might bring these back. But the drug market has changed and the most pricey new meds won’t necessarily be attainable from abroad anyway
  • Let individuals who buy their own health insurance take a tax deduction the way businesses already do. Again, sounds great in theory but it’s a regressive approach that rewards higher income people who are in the top tax brackets. It also encourages premiums to rise and widens the budget deficit. The Cadillac tax or some variant that limits deductibility by businesses is more fiscally responsible
  • Expand Health Savings Accounts (HSAs), allow them to be shared among family members and passed on as part of one’s estate. Not a bad idea but hardly a game changer in its own right

Remember, thought, that the Republican ideas above were presented by conservatives, while Trump himself has been at least a liberal and frankly more of a socialist when it comes to health care policy, at least based on his earlier writings. Once he learns that the ideas of the conservatives in Congress won’t produce universal coverage, he may well go back to improving –instead of replacing– Obamacare, moving to a Canadian style single payer system, or opening up Medicare for all, just like Bernie and much more radical than Hillary.

I can’t wait to see how it all plays out.

Image courtesy of Thanamat at FreeDigitalPhotos.net


By healthcare business consultant David E. Williams, president of Health Business Group.

 

LBJ would think walking meetings are pretty lame

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Don’t talk to me about walking meetings

The Wall Street Journal continues to go soft on us. I just read about “walking meetings,” which are just what they sound like: conducting meetings while walking around. According to the Journal, these meetings are great for combating obesity and diabetes, and improving creativity. With meetings, phone calls and emails taking up more than 90 percent of the workday for some people (consultants like myself included), the Journal touts studies purporting to show the benefits of wandering around at work.

Walking meetings aren’t really new. Kaiser’s Dr. Ted Eytan touted the idea on my blog five years ago.

Sure it’s good to get moving, and taking a walk can be just the thing to clear one’s head, but when I’m in a meeting I’m usually taking notes and often viewing documents. Many meetings are confidential and sometimes they involve 10 or more people. So IMHO most serious meetings are not suitable for walking.

When I was an economics student at Wesleyan in the 1980s, professor Stanley Lebergott told me about a pretty crazy job interview his colleague Douglas Cater had with Lyndon Johnson at the White House –swimming nude in the pool and having to keep up with Johnson while trying to answer questions. Although I believed my professor, you might not, so here’s how it’s recounted in Jack Valenti’s memoirs:

I’ll never forget the day LBJ brought Doug to the White House to sort of interview him. ‘Let’s go for a swim, Doug. Okay with you?’ said the president. Well, of course it was, so Doug, Bill Moyers, and I followed the president to the swimming pool. Doug’s eyes almost popped out when LBJ, Bill, and I threw off our clothes and jumped into the pool, nekkid, as we say in Texas. After a moment’s hesitation, Cater stripped and plunged in, too.

As we splashed around, the president began chatting with Doug about his ideas for making the Johnson administration more effective. I daresay, many of us have been interviewed in odd places, but as Doug said later, ‘Nothing compares with my waterlogged birthday suit interview with the president.’

Compared to this, walking meetings are nothing. Can’t the Journal find something more inspiring or scandalous to write about?

By healthcare business consultant David E. Williams, president of Health Business Group.

Drinking while grocery shopping. Is pot next?

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Where did my grocery cart disappear to?

Amazon.com seems to be unstoppable. It’s grabbed the lion’s share of the e-commerce market, turned other retailers into mere showrooms for shoppers who then purchase online, discarded list prices in favor of its own internal comparisons, and turned Prime Day into a new national shopping holiday. Little buttons around the house can be pressed to reorder staples, and voice commands to my Amazon Echo can summon goods to the home.

Supermarkets are now in Amazon’s sights. I’ve received come-ons lately for Amazon Fresh.

But instead of quaking in their boots, some supermarkets are taking a page from the casino playbook and offering inexpensive alcoholic beverages to customers. From the Wall Street Journal (Supermarkets Invite Shoppers to Drink While They Shop):

At nearly 350 Whole Foods locations nationwide, shoppers can carry open beverages out of the bar area and around the store as they shop around. Some stores have added cup holders to their shopping carts or placed racks around the store where shoppers can place empty stemless wine glasses. In some Texas locations, the $1 cans of beer rest in ice-filled buckets labeled “walkin’ around beer.” “When customers find out that they can sip and shop, a lot of times it’s a lightbulb moment,” Mr. Kopperud says.

Take that Jeff Bezos!

As just about everyone knows, alcohol lowers inhibitions and is more or less guaranteed to boost retail sales. Impulse purchase anyone?

But let’s fast forward this story just a bit. With the movement toward the legalization of marijuana for recreational purposes –which I oppose– it’s just a matter of time before these same stores start opening marijuana boutiques at their entrances, featuring a wide variety of tasty edibles. For Whole Foods they will likely be organic, gluten free and artisanal.

You can bet the munchies will contribute to a healthy boost to the average sale!

Come to think of it, these two ideas aren’t mutually exclusive. A walkin’ around beer and a marijuana edible sounds pretty darn attractive.

Ok, Amazon. What’s your reply?

Image courtesy of iosphere at FreeDigitalPhotos.net

By healthcare business consultant David E. Williams, president of Health Business Group.

Vision Zero: The poem

Oops, didn't see that coming

Oops, didn’t see that coming

My father, Allan F. Williams is a renowned highway safety expert, sometimes called the Grandfather of Graduated Licensing. He retired from the Insurance Institute for Highway Safety as Chief Scientist in 2004.

Recently he told me about Vision Zero, a Swedish notion, now popular in the US, that there should be no deaths or serious injuries on the highways. But one problem with this idea is that about three-quarters of people think they are superior drivers and that the highway safety problem is due to the “other” driver.

He wrote a little poem to explain what’s happening on the roads.

Good Driver, Bad Driver

I’m a highly skilled driver, and you are not,

I know, I’ve seen enough of your lot.

You bumble around, get in my way,

Your feeble talents on full display.

Rules of the road are meant for you,

Whereas I can flout them, and often do

I speed, I phone, I drive with flair

And never, ever, make any error

Vision zero is a reality,

With fewer of you and more drivers like me.

Allan Williams, 4/4/16

Image courtesy of Salvatore Vuono at FreeDigitalPhotos.net

By healthcare business consultant David E. Williams, president of Health Business Group.