Health care costs in the U.S. have been rising so steadily for so long that containment barely seems possible. Even optimists don’t dream of cutting the price tag. As its official name — the Patient Protection and Affordable Care Act — suggests, Obamacare aims for affordability, not radical reduction.But at a time when we’re all […]
One issue I have with our modern lifestyle – of many — is the emphasis on perfection. Newer, slimmer, bigger, better, faster: the message of perfection screams out to us from glossy magazines, slick television ads and popup ad after popup ad. (Or purrs, cajoles, teases, and smothers.)While I do believe fundamentally in pursuing whatever your […]
Franklin Delano Roosevelt famously used the term “forgotten man” in a 1932 speech to describe those at the bottom of the economic pyramid who, he felt, government should aid.But the originator of the phrase “forgotten man” had a whole different meaning in mind. He aimed to expose the seeming good intentions of government to reveal […]
In September 2009, when President Obama made a primetime speech pitching his not-yet-passed health care overhaul, he made the following promise: “I will not sign a plan that adds one dime to our deficits — either now or in the future. Period.” To prove his seriousness, he further promised that “there will be a provision […]
What’s the #1 reason a start-up fails?It runs out of money!And why would it run out of money?Because nobody wants the product it’s selling!For early-stage investors, this presents a bit of a conundrum:If a product doesn’t exist yet, how do you figure out if there’s demand for it?And how do you figure it out before […]
Biotech breakthroughs and other transformative innovations are a few of the brightly shining spots in the U.S. economy. In fact, Paul Mampilly believes this is the golden age of biotech investing, and that you can earn massive returns while investing in companies with drugs that benefit all of humanity. Read on for his latest example...
Obama recently claimed this was the “Decade of the Brain”. But it not the first time the government made that promise. The last time they did it, they wasted millions of your tax dollars. Now they’re back for round two. But this time, their failure could mean more than squandered money. It could mean making Alzheimer’s even worse for those who suffer from it.
Why Is U.S. Health Care So Much More Expensive?After years of research and many conversations with health policy experts, I see three key culprits of expensive health care in the U.S.In no particular order, they are the third-party payer system (i.e., employer-provided health care), malpractice suits, and administrative support costs/paperwork.The unintended consequence of institutionalized employer-provided […]
Back in the 1980s, John Nestor became infamous for single-handedly causing massive traffic jams on the Capital Beltway. But in his professional life, he created a completely different kind of traffic jam... one that may have contributed to the deaths of thousands of innocent people. Juan Enriquez has the full story. Read on...
The Food and Drug Administration will tell you they’re there to protect you. To make sure the food and medicine you put in your body won’t hurt you. But good intentions and actual results rarely match up. Instead, the FDA’s drug certification process has made it easy for business to corner drug markets, and jack up prices. In the end, the only thing the FDA protects are these companies’ profits.
Given the insane amount of time, effort and money it costs to bring a drug to market, it's no wonder why drugs are so expensive in America. And even when a drug comes along that IS cost effective, you can count on the FDA to play its part in jacking up the price. Mark Thornton explains...
Generic drugs are supposed to lower healthcare costs and provide you with another medical alternative. That’s what it says on paper. But there’s a real danger that goes along with these drugs. A danger even your doctor might not be aware of.
Too many people think that long-term care planning is just a decision about whether to purchase long-term care insurance. However, long-term care planning is so much more. It is a discussion about how you will fund this expense, where you will receive long-term care, and who will provide the care.
Politicians talk about the uninsured. Special interests argue on behalf of those with pre-existing conditions. But why is no one wondering how doctors are affected by the new law? They’re the ones on the frontlines dealing directly with new patients, as well as the red tape that makes bureaucracies go round.
Just because you’re retired doesn’t mean you have to stop working. Especially now that you have all the time in the world to do what you really want. Entrepreneurs don’t only come out of Silicon Valley. They come from all walks of life, from all different ages. If you’re retired and want to stay active while you relax, then find out the steps you need to take in order to start, manage, and grow your next small business.
The U.S. dollar has been the world's reserve currency for almost a century, and already there are signs it may be in decline. But that doesn't mean it's not still valuable. On the contrary... As Chris Mayer explains, there are many reasons the U.S. dollar will remain relevant on the world stage for years to come. Read on...
The Congressional Budget Office said the government needed to reach 7 million people by the end of March. They claim to have reached the goal and now the debate about Obamacare is over. But what does this milestone really mean in the ongoing healthcare discussion? And more importantly, how will it affect reforms going forward?
In an effort to cut costs and keep track of patients' records, governments could institute a medical guideline cookbook. Bureaucrats might think they have the best of intentions in mind, but these new rules would drag down the medical process and destroy whatever quality is left in our current system.
When government expansion is allowed to continue unabated or when it casts a heavy regulatory shadow on America’s entrepreneurial spirit, the freedoms that we’ve come to know, and perhaps take for granted, slowly begin to slip away.
The new reality of Obamacare’s tax credits has left finance reporters to pen articles warning readers to “take care” when considering a tax credit and providing strategies for how best to “protect yourself.” So what do finance reporters know that the White House doesn’t?
As full implementation of the Affordable Care Act (ACA) approaches, every doctor, research professional, and health administrator I talk to tells me the same thing: Obamacare is going to reduce the quality of care and cost you more… in some cases, a lot more.
This technology is not simply for modeling and prototyping, either. TV personality Jay Leno uses a 3-D printer to make custom and hard-to-find parts from scratch for his collection of classic cars. Entrepreneurs have been using these printers in a myriad of ways, and the trend is speeding up.
The Affordable Care Act creates a new health insurance marketplace (the exchange). But because of the great uncertainty about what buyers will enter the market and who will buy what product, the law creates three vehicles to reduce insurance company risk.
Facts are easy. You can check facts. What supporters of the Affordable Care Act are doing, on the other hand, transcends factual bungling. It’s far more advanced: a warping of reality so debauched it looks like something out of a tale by H.P. Lovecraft.
The highest form of charity, argued the 12th-century Jewish philosopher Maimonides, is when the help given enables the receiver to become self-sufficient.But our systems of state charity — aka welfare — have too frequently had the opposite effect: They have actually created dependency. It is time to rethink the way we help people.I’m going to […]
Recent difficulties with implementing the Affordable Care Act have increased opposition to the program. A majority of Americans now oppose it. Problems with the HealthCare.gov website are in all likelihood temporary. However, there are serious long-term problems, particularly considering long-term finance and labor supply issues. Given the mounting difficulties with and growing concerns about the […]
Do you trust your doctor? Most patients assume their doctor is working in their best medical interests whenever he or she orders a diagnostic test or recommends a particular treatment. Customers might wonder whether an unscrupulous auto mechanic is being truthful when he recommends a brake job or a new transmission. But most patients trust […]
Writers sometimes worry if a day will come when they have nothing more to say. As long as Paul Krugman is around, I will never have that worry.
Boston University professor, Lawrence Kotlikoff has suggested that Krugman return his Nobel Prize. I hope he doesn’t. As long as someone with Krugman’s professional status gets his facts wrong in column after column, and does so in an arrogant and pompous manner, attacking the integrity and hurling insults at all who disagree with him… well, there will always be a market for a writer who is able to show that the scourge of sensible people everywhere has written one more erroneous editorial.
Krugman may not always be wrong. On some economic issues he may actually be right. But when it comes to health care, he almost never misses. He is wrong 100% of the time.
In a recent New York Times column Krugman pronounced Obamacare a success before it has even been tried. Why? Because the premiums to be charged in California health insurance exchange are apparently lower than what the experts thought they would be:
“Well, the California bids are in — that is, insurers have submitted the prices at which they are willing to offer coverage on the state’s newly created Obamacare exchange. And the prices, it turns out, are surprisingly low. A handful of healthy people may find themselves paying more for coverage, but it looks as if Obamacare’s first year in California is going to be an overwhelmingly positive experience.”
I did a quick check and discovered that if a 25-year-old in Los Angeles chooses the least expensive plan offered on the California health insurance exchange, the premium will be $142 a month. Yet the cheapest plan offered on eHealth today is only $92 a month.
Aah… let’s see… Everybody thought health insurance premiums would be 100% higher. In fact, they are only 60% higher… Hooray… Break out the champagne!
I’ll come back to these price comparisons in a minute. For the moment, I would ask: What kind of an economist would celebrate an expected price decline without asking what happened to quantity or quality? This is an Econ 101 mistake.
As it turns out the health insurance to be sold in the California exchange excludes some of the best hospitals and the best doctors. Also, the fees paid to providers will not be the same as commercial insurance are paying. They will be somewhere between the commercial rates and Medicare rates. This means that people with exchange acquired insurance will be less desirable to providers from a financial point of view than people in orthodox plans. As the Los Angeles Times explains:
“People who want UCLA Medical Center and its doctors in their health plan network next year, for instance, may have only one choice in California’s exchange: Anthem Blue Cross. Another major insurer in the state-run market, Blue Shield of California, said its exchange customers will be restricted to 36% of its regular physician network statewide.
“And Cedars-Sinai Medical Center, one of Southern California’s most prestigious and expensive hospitals, said it’s not included in any exchange plans at the moment.”
Krugman points to the experience of health reform in Massachusetts in predicting how wonderful health reform is going to be:
“Massachusetts has had essentially this system since 2006; as a result, nearly all residents have health insurance, and the program remains very popular. So we know that Obamacare — or as some of us call it, ObamaRomneyCare — can work.”
But what has really happened in the Bay state? Insurance sold in the Massachusetts exchange pays doctors and hospitals only about 10% more than what Medicaid pays. And for reasons that are not entirely clear, doctors are less willing to see the newly insured (with exchange subsidies) than Medicaid patients.
The Massachusetts reformers believed that once everyone was insured, patients would go to the doctor’s office for primary care, rather than to the hospital emergency room. But in expanding the demand for care, they (just like Obamacare) did nothing about supply. The newly insured can’t go to doctors’ offices for their primary care if there aren’t any more doctors’ offices.
Here is what is happening on the ground. Traffic to hospital emergency rooms in Massachusetts is higher today than before health reform. Traffic to community health centers is almost one-third higher than it was before reform. Yet the time it takes to get care is growing. The wait to see a new doctor in Boston today is two months — the longest wait in the entire country.
On balance, the only thing that seems to have changed in Massachusetts is that patients are waiting longer. They are going to the same places to get care that they went to before. They are getting the same care from the same providers. In the process, more money is being moved around. A lot more money.
Let’s return to the subject of California premiums. Krugman links to a Johnathan Cohn New Republic column claiming that premiums on the newly created health insurance exchange will actually be lower that they are today. Yet this assertion is based on comparing premiums in today’s small group market with expected individual premiums on the health insurance exchanges. That’s not the right comparison.
Small group premiums are significantly higher than individual premiums in most states. The relevant comparison is today’s individual insurance premiums versus the individual premiums in the exchange. Exchange premiums are going to be higher.
With health reform, California premiums will be higher than they are today, but the sticker shock will not be as severe as in other states. The reason: California already has unisex rate requirements. As a result the age differential for males (60-year-old versus 20-year-old) is already close to the 3-to-1 band required by Obamacare. In states without unisex regulation, the age differential would be 6 to 1.
Still, middle-class families in California should brace themselves. The surprises in Obamacare are going to be just as arbitrary and unfair on the West Coast as they will be in the rest of the country.
– John Goodman
Article originally appeared here.