Monday, January 24, 2011

Give Us Something We Can Use

“Mr. Cunix?”

I recognized that voice.

“This is Belinda Prinz from Congresswoman Marcia Fudge’s office.”

Regular readers know that I have mentioned my Congresswoman a couple of times in my two blogs. We also know that Congresswoman Fudge, or her staff, are regular readers. Ms. Prinz even commented on the August 30, 2010 post, Choosing Sides.

Belinda Prinz must have drawn the short straw. There is no doubt that she considered herself fortunate that she reached my voicemail instead of me. Her assignment was doomed to failure. She was on a fool’s errand and the longer she talked, the more apparent it became to her.

One of Congresswoman Fudge’s other staffers had called the Beachwood Chamber of Commerce and had talked with our Executive Director, Wayne Lawrence. He suggested that she call me. What did the Congresswoman want?

“We would like to know the name of a small business that can now provide insurance benefits to its employees because of the tax credits in the Patient Protection and Affordable Care Act. We want to tell their story.”

Yes, Congresswoman Fudge is desperate to find someone, anyone, who has benefited from last year’s legislative train wreck.

Let’s think about this for just a second. We would need to find a small business that
* Didn’t provide health insurance
* Wasn’t motivated by the tax deductibility of health insurance premiums
* Doesn’t pay its employees very well
* Is making enough profit that the tax credit is irresistible

Does that sound like any business you know? Of course not. Will Congresswoman Fudge or one of her cohorts find a couple of examples somewhere in this country? I like their odds. Still, it might be worthwhile to research the details when they trot out their success stories.

It is far easier to find the victims of last year’s legislation. There are businesses that fear my phone calls, worried that this year’s renewal rates will be more than they can spend. My restaurants and other clients that employ lots of unskilled and semi-skilled workers are very worried about the planned tax/fee/penalty to be assessed to businesses that don’t provide group health insurance. The saddest and most immediate blow was dealt to parents.

Proponents of the Patient Protection and Affordable Care Act love to note that children are now guaranteed issue. Insurance companies can no longer refuse to cover a minor due to preexisting conditions. Fearing the inevitable dumping of unhealthy children from group (employer sponsored) policies to individual contracts, the insurance companies simply stopped selling Child,Only policies.

The few unhealthy uninsured children of families that neither qualified for group health insurance or Medicaid are still uninsured. This will not change for another couple of years, if ever. But the negative impact was immediate.

Janet (name changed) works for a large property management company. Her employer’s new policy, as of February 1st, will cost her only $60 per month. That is the price for just her, the employee. The premium for her and her two daughters would be just a touch over $500 per month. Employers across the country are cutting back. One way to save money is to pay only a portion of the employee’s health insurance. If the employee wants to cover a spouse and children, he/she will be charged the difference.

A year ago I could have written great coverage on Janet’s two healthy daughters for less than $200 per month. Janet would have stayed on the employer’s plan, placed the girls with Anthem or MMO, and saved over $2,000. Janet even had the option of choosing a higher deductible and saving even more. Today? Nothing!

Janet has two options. She can stay on her employer’s plan and work for the insurance or she and her two daughters can purchase a fully underwritten individual (non-group) policy. She chose a high deductible health plan that will cost her $194 per month for the three of them. Is this the best solution? Of course not. But Congresswoman Fudge and her friends killed the best solution last March.

I didn’t return Ms. Prinz’s phone call. I don’t know of any businesses or employees who have benefitted from her boss’s efforts. And I have no reason to believe that our Congresswoman has any interest in learning about the collateral damage.

Besides, we know they are reading this. We just don’t know if they care enough to make any changes.


Thursday, January 13, 2011

Hyperbole – Fun For The Entire Family

The members of the House of Representatives were sworn in this week. The Republicans are now in the majority. Representative John Boehner (R-OH) is the new Speaker. Will their first major issue be the economy? The deficit? Jobs? Our young men and women dying on foreign soil? Don’t be silly. Just as the Democrats rushed past the necessary in favor of health care and health insurance, the Republicans are ready to vote to repeal “Obamacare”.

The Republicans have excitedly drawn a line in the sand. This expression couldn’t be more apropos. The common understanding is that they have marked off their territory and will defend to the death their beliefs. But we all know that this vote, and the days of debate that will precede it, are a terrible waste of time. The Republican House will pass a bill that the Democrat controlled Senate will ignore and the President would quickly veto.

The Republicans have excitedly drawn a line in the sand. Take that literally. As everyone who has ever had the pleasure of visiting a beach knows, drawing a line in the sand is a temporary act that has no value. Your line, or if you are really ambitious, your sand castle, only lasts until the next inevitable wave washes it away.

The reopening of last year’s health care debate has allowed both sides to erect and knock down their favorite straw men. If it were not for the recent tragic events in Arizona, we would have had the debate and vote this week. Instead, we are treated to a week of accusations and recriminations. Health care will have to wait till next week.

But the posturing has begun.

The Republicans talk about tyranny, about forcing citizens to have insurance to pay their medical bills. They also point to a huge new federal government program, much like No Child Left Behind, that will impose new costs and responsibilities on the states. There is nothing worse than a poorly designed, unfunded program created by the other side.

The Democrats are relishing this debate. They love to point out that children are now guaranteed issue and that their preexisting conditions must be covered. The Dems just conveniently forget to mention that Child Only policies no longer exist in most of the country. If the policy still existed, it would be wonderful for a limited number of families. Instead, lots of healthy children can no longer be covered at a reasonable price.

Other new benefits include free Medicare physicals for seniors and that adult children can now stay on their parents’ policies until they are 26. We don’t need to do scientific polling to learn that people like free stuff. Who pays for this free stuff? Well, you do of course.

The other big defense of the Patient Protection and Affordable Care Act (PPACA) is that its repeal would cost us money. Senator Sherrod Brown (D-OH) has been citing the Congressional Budget Office’s estimate. This, too, is a moving target. The Senator has used a CBO figure of $232 billion of savings over the next ten years. Some sources have soft-peddled this down to a more believable $100 billion while others have reiterated the $230 billion guesstimate.

How does the federal government profit under PPACA? Part of the money comes from unrealistic cuts in Medicare. The oft-maligned new 1099 regulations, a set of rules to attack the underground economy, account for $18 billion. Another moneymaker is the tax/fee/penalty imposed on businesses that don’t provide employee coverage by 2014. The Democrats are also counting on the tax on so-called Cadillac health plans to generate a chunk of change.

None of these revenue sources stand on their own merit. The 1099 rules are already on life support.

The House Republicans have yet to creatively and constructively begin the difficult task of restructuring the PPACA to address our system’s deficiencies. The Democrats are defending the indefensible because they can. Meanwhile, businesses are spending money to comply with laws that are still changing and the only thing we all share is uncertainty.

If you are forced to watch C-Span next week, I suggest you hit the mute button.