Subject: DJP Update 12-19-2009: President and Senators press conferences of today about reaching 60 senate votes for senate health bill
DJP Update 12-19-2009: President and Senators press conferences of today about reaching 60 senate votes for senate health bill
I hope you had the opportunity to hear President Obama and then Senator Reid et al different press conferences today. It was covered on C-Span and no doubt most of the network and cable channels. 60 votes are now lined up to get cloture as Senator Nelson of Nebraska said he will vote for cloture.
President Obama did not take any questions from the press. The senators did.
But has the American public read the new version of the Senate bill? Good luck finding that version prior to press conference. Senator Reid say that those who oppose his version “should spend a couple of days reading our mail.” What about letting Americans spend a couple of days reading the bill before forcing a vote?
The Republicans insisted on the bill being read word for word aloud in the Senate before the vote and that is being done now.
The statement also made today at press conference that “inaction is not an option.” Comment by DJP: That is a false framing of the debate. The issue is not Senator Reid’s bill versus no bill. That is not the total universe of choices. What about a choice of individual ownership of policies, tax credits, purchase across state lines, protecting health savings accounts, medical liability reform, etc. etc.? One cannot let someone frame a debate that limits choices.
Senator Baucus said at the press conference, “Our bill will be fully paid for. This is the largest tax cut since 2001.” Does he think that is true? Does he think Americans will believe that?
Senator Harkin said at the press conference that he and Senator Dodd and Senator Baucus all came to the Senate in 1975. After this press conference and watching how this bill has been handled, I suspect some Americans might think about a push to create term limits for folks in Congress.
And it was fascinating to hear the response of how the special treatment of certain senators and their states were handled in the press conference. Check out the special advantage of Louisiana, Nebraska, and a few others. Response by Senator Reid to press questioner about 100% coverage for Nebraska Medicaid “forever”, and Senator Reid said, “…You will find that a number of states are treated differently, that is compromise.” He said some of the time that is how you get their vote. I recorded that press conference and replayed it to be sure I did not hear it incorrectly.
Well, now think about the possibility of other senators asking for treats and incentives in this candy store or they might withhold votes going forward. This reminds me of the George Orwell’s “Animal Farm” book excerpt where the “Commandments” suddenly, without discussion, are reduced to a single “Commandment”, “All animals are equal but some animals are more equal than others.”
I do have the Congressional Budget Office scoring of costs letter that was issued today. Here are a few excepts.
From 12-19-2009 38 page CBO letter to Senator Reid
Excerpt from page 13 A provision that would increase Medicare’s payment rates for physicians services by 0.5 percent for 2010 was eliminated. Instead, the 21 percent reduction in those payment rates that is scheduled to occur in 2010 under current law would take effect.
DJP comment: I conclude this is funny math. Is this to reduce the CBO scoring cost of the bill to keep it under one trillion dollars? Some might say yes! Instead the senate has put a temporary hold of the payment cut in another bill. Once again, when physicians grant government the right of government to price-fix, and that is what the government programs do because they are not indemnity payments with the right of the physician and patient to privately contract for any difference in the cost of the service and what the payment from government is, the doctor and patient lose. The end result is loss of liberty and erosion of the Free Enterprise System.
Read the whole CBO letter yourself. Go to: http://www.cbo.gov/ftpdocs/108xx/doc10868/12-19-Reid_Letter_Managers.pdf
Here are a few more excepts from the CBO letter to Senator Reid without comment by me at this time. I have to go back to work now. But do note the “substantial uncertainty” language found in the letter.
EXCERPT from page 2:
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This estimate incorporates the effects of the manager’s amendment, which would make a number of changes to the Patient Protection and Affordable Care Act as originally proposed. The changes with the largest budgetary effects include: expanding eligibility for a small business tax credit; increasing penalties on certain uninsured people; replacing a public plan that would be run by the Department of Health and Human Services (HHS) with multi-state plans that would be offered under contract with the Office of Personnel Management (OPM); deleting provisions that would increase payment rates for physicians under Medicare; and increasing the payroll tax on higher-income individuals and families. Of the total deficit reduction of $132 billion projected to result from the legislation, the manager’s amendment accounts for about $2 billion, and the act as originally proposed accounts for the remaining $130 billion.
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Page 4
—– Estimated Budgetary Impact According to CBO and JCT’s assessment, enacting the Patient Protection and Affordable Care Act with the manager’s amendment would result in a net reduction in federal budget deficits of $132 billion over the 2010-2019 period (see Table 1). In the subsequent decade, the collective effect of its provisions would probably be continued reductions in federal budget deficits if all of the provisions continued to be fully implemented. Those estimates are subject to substantial uncertainty.
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Page 7
Starting in 2014, the legislation would establish a requirement for such residents to obtain insurance and would in many cases impose a financial penalty on people who did not do so. The bill also would establish new insurance exchanges and would subsidize the purchase of health insurance through those exchanges for individuals and families with income between 133 percent and 400 percent of the federal poverty level (FPL). Policies purchased through the exchanges (or directly from insurers) would have to meet several requirements: In particular, insurers would have to accept all applicants, could not limit coverage for preexisting medical conditions, and could not vary premiums to reflect differences in enrollees’ health. The options available in the insurance exchanges would include private health insurance plans and could include two national or multi-state plans operated under contract with OPM. Starting in 2014, most nonelderly people with income below 133 percent of the FPL would be made eligible for Medicaid. The federal government would pay all of the costs of covering newly eligible enrollees through 2016; in subsequent years, the federal share of spending would vary somewhat from year to year but would average about 90 percent by 2019. (Under current rules, the federal government usually pays about 57 percent, on average, of the costs of Medicaid benefits.) In addition, states would be required to maintain current coverage levels for all Medicaid beneficiaries until the exchanges were fully operational; coverage levels for children under Medicaid and CHIP would have to be maintained through 2019. Beginning in 2014, states would receive higher federal reimbursement for CHIP beneficiaries, increasing from an average of 70 percent to 93 percent. The legislation would also provide states with additional CHIP funding in 2014 and 2015.
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Page 8
Effects of Insurance Coverage Provisions
CBO and JCT estimate that provisions affecting health insurance coverage would result in a net increase in federal deficits of $614 billion over fiscal years 2010 through 2019 (see Table 4). That estimate includes $395 billion in additional net federal outlays for Medicaid and CHIP.3 It also includes $436 billion in federal subsidies that would be provided to purchase coverage through the new insurance exchanges and related spending.4 The other main element of the coverage provisions that would increase federal deficits is the tax credit for certain small employers who offer health insurance, which is estimated to cost $40 billion over 10 years. Those costs would be partly offset by receipts or savings, totaling $257 billion over the 10-year budget window, from four sources: net revenues from the excise tax on high-premium insurance plans, totaling $149 billion; penalty payments by uninsured individuals, which would amount to $15 billion; penalty payments by employers whose workers received subsidies via the exchanges, which would total $28 billion; and other budgetary effects, mostly on tax revenues, associated with the expansion of federally subsidized insurance, which would reduce deficits by $65 billion.5
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Page 13
The penalty for not having insurance would be the greater of a flat dollar amount per person or a percentage of the individual’s income, which would increase the amount of penalties collected.
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And now you can see the actual 383 page amendment put forth by Senator Reid. This amendment is what the CBO “scored”. Go to:
http://democrats.senate.gov/reform/managers-amendment.pdf
Stay well.
Donald
Donald J. Palmisano, MD, JD
Intrepid Resources® / The Medical Risk Manager Company
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Metairie, Louisiana USA 70006
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DJP@donaldpalmisano.com
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