Wednesday, November 30, 2011

Medicine: There Should be an App for That.

The problem with health care is the total disconnect between the service or procedure and the consumer.  With a family of eight, although everyone is apparently healthy overall, our bills tell a different story.

We have various run-ins with doctors all year.  One "minor" day surgery procedure -- which entailed a total of two hours in and out, a snip here, a stitch there, a bit of anesthesia -- cost us a cool ten thousand dollars.  Yes, that's right.  It makes me yearn for the old days (not really) when we could have just gone in and done the snipping and stitching ourselves.  But seriously, before the procedure, being the optimists that we are (or were), we figured this procedure would cost maybe two thousand dollars.  Seemed like a good imaginary price.  But of course, we found out later, we were wrong.  Totally wrong.  We did call before the procedure to find out how much it would all cost, and we were told that it would take two to three weeks to get us an estimate.  (That should have been the tip-off).

Then there was the thirty-minute MRI that cost us five thousand dollars.  Ten years ago, the exact same procedure using the exact same machine (I recognized it) had cost five hundred dollars.  When we called afterwards to find out why the procedure had increased ten times in price in ten years, we got not even an attempt to explain the huge difference in price.

Now today I have another "minor" procedure to attend to.  So, being the savvy consumer that I am, I called to inquire about price.  I was shuffled off by phone to the appropriate department, and when I reached the person (thankful she was actually there), she told me that it would take her three days to work up an "estimate".  I asked her whether this wasn't a pretty run-of-the-mill typical procedure, and shouldn't they have an "estimate" already?  (I would think that after three days they could actually give me a cool, hard price, after all that time and work).  Not the least bit amused, she explained that she would have to refer the question to various appropriate departments, and then repeated her answer that it would take them three days to work up that estimate.  Clearly, I wasn't getting anywhere.  I tried again -- well, shouldn't someone have some ballpark idea?  No, becoming tired of me and my apparent lack of understanding, she repeated the same answer.  (I might have detected a sigh too).  Then she added that most people who are concerned about price call well in advance.

As I hung up, resigned to my fate, I couldn't help but think, shouldn't we all be concerned about price?  Is there any other arena of life in which we are not concerned about price?  I mean, I worry about the price of diapers, ice cream, dinner out, dance lessons, soccer cleats, Christmas.  We have a budget for these things.  Most people do have budgets, I think.  Or at least they have a defined income within which they must live.  I can't think of any other industry in which people, including those who work in their field, are totally in the dark about price.

Even if he doesn't know exactly how much is owed, perhaps, at least a person knows what his monthly house payment is or what his car payment is, if he has one.  We are concerned about big prices and little prices.  I was just out Christmas shopping and my shopping buddy decided to wait to buy some gifts until she could be sure she could get the best possible price.

Now, I just read, there's an app that can tell you, right at the store, whether you're getting the best deal on that giant set of paper towels, or whether you should drive next door to save a couple dollars -- maybe even five.  It can tell you whether you're getting the best deal on the Pharaoh Lego set for your darling cutie-pie.

Just recently a friend face-booked all of us on her great grocery deals at Shaw's -- with pictures and everything!  Just imagine if every week we went into the grocery store, loaded up on groceries for the week, and then on checking out, were told that the store would work on it and send us a bill in the next week or so.  Imagine buying a house and signing all those papers (there's an endless amount of paperwork at the doctor's office too), all with no idea how much the whole thing is going to cost.  Even attorneys have hourly rates and specific document fees or flat-rate fees, of which they inform their clients before they begin representation.

So, as I head off into the great hazy unknown for my minor procedure, be concerned for me, and wish me good luck--on the price.

Tuesday, November 22, 2011

Obamacare nightmare

This is yet another example of why government run health care will be a nightmare.  The government picks on small corporations who don't have the wherewithall to fight Washington, and big corporate firms  hire lobbyists to make sweetheart deals with the government.  The result:  big government/big corporate monopolies which  mean less freedom, higher costs, and government/private company corruption. 

(From the Opinion Journal Newletter --of the Wall Street Journal)

The Obama administration promised that the Affordable Care Act would protect the public from "unreasonable" premium increases, and now our guardians at Health and Human Services are finally bringing one of those scofflaws to heel. Perhaps the first HHS target would be, say, WellPoint, the giant for-profit corporation that was President Obama's bĂȘte noire during the health-care debate?
Nope. HHS has smaller fish to fry. In the first federal rate review case, announced yesterday, the department is targeting . . . Everence Insurance Co., which is run by the Mennonite Church and covers 4,846 people in rural Pennsylvania. The carrier is raising its small-business rates there by 11.58% on average next year, and HHS Secretary Kathleen Sebelius said that her agency's enforcement action "sends a message to insurers around the country that the days of unchecked and unfair doubt-digit rate increases are over."
It won't, and they aren't. For the past three years Everence's claims have exceeded its premiums, meaning the company has been operating at a loss. Its technical "underwriting gain/loss" measure for this book of business is currently minus-41%, so for every dollar of revenue it receives it spends $1.41. This company is not exactly the paragon of corporate greed that the likes of Ms. Sebelius so often invoke.
HHS's vague rule of thumb is that any premium increase over 10% is probably "unreasonable," though not unless the agency says it is. Currently HHS doesn't have the regulatory powers to revoke such increases, but the program is a prelude to such price controls on private insurance. Ms. Sebelius and HHS are keeping a registry of offenders who will then be handicapped when selling their products once the rest of ObamaCare comes on line in 2014.
What the Everence case study really shows is that the main factor driving premiums is the underlying cost of medical care, not insurer profits or malfeasance. As for that supposed scourge, why couldn't HHS find a more unsympathetic villain for one of its signature programs than a small Mennonite health plan that no one has ever heard of and is hanging on for dear life?

Saturday, November 19, 2011

One reason why a 9% national sales tax is a good idea

Many conservatives have questioned the portion of Herman Cain's 9-9-9 plan that calls for a 9% sales tax.  To be sure, there is a danger that a new type of tax can be subject to abuse.  But as Cain says, his proposed tax system is so simple that the people can monitor when Congress decides to raise taxes.  Now because there are so many hidden taxes and tax loopholes, we cannot discern when are taxes are being raised.

But here is why I think a 9% sales tax is a good idea:  As an attorney who has represented thousands of people over the last 32 years,  I know that there are many people who do not report all of their income.  There is a vast underground economy in this country, if my experience is any guide.  The practice is so common that the courts do not even comment on it when the issue is brought up at trial.  

I am sympathetic with people who are loathe to pay taxes, but for those who do not report income, there are others--namely wage earners--who have to take up that slack by paying higher taxes.  It is not fair to those who do report all of their income, or who are forced to report all of their income because they are W-2 employees. 

A 9% sales tax is a simple way to require those who live on unreported income to pay some federal tax. 

Barack Obama and the Democratic Congress tried to fix this problem by forcing business owners to file 1099's on most purchases, resulting in a bookkeeping and paperwork nightmare.  Public outcry forced the government to rescind that requirement.  Similarly, more IRS auditing of individual taxpayers might force more reporting of cash income, but that would require far more IRS agents and more intrusion into our lives.  And an IRS audit is expensive for both the government and individual.

So, while a national sales tax may be distasteful to many, it accomplishes one goal in a simple, non-intrusive way:  it  taxes people who do not report all of their income, without any cumbersome or intrusive mechanisms to force people to report their unreported income. 

Sunday, November 6, 2011

Civility revisited

  President Obama gave an eloquent speech in Tucson on January 12, 2011 after the shooting of Representatiave Gabrielle Giffords.  In it he said   "How can we honor the fallen? How can we be true to their memory?  ....[we can remember]  we are all Americans, and that we can question each other's ideas without questioning each other's love of country" 

Earlier in 2010, when the Tea Party Movement began, Democrats called for civility on the House Floor when false reports about Tea Partiers calling Representatives racial slurs surfaced.

The Establishment Media reported endlessly about the "lack of civility"  here here here here and here which they concluded caused the Tucson tragedy.  One pundit even called for a National Civility Month, and USA Today reported that a National Civility Institute was being established by President Bill Clinton and President George H.W. Bush.  Never mind that the Tucson tragedy was perpetrated by a mentally ill assailant who had no political motive.  These articles linked the conservative Tea Party to the lack of civil discourse in this country.

How times have changed in so short a period.  First, a mere month after the Tucson tragedy, there were the decidedly uncivil  union protests in Wisconsin and elsewhere across the country.  The Establishment Media and the President were silent on the the lack of civility by union protestors. Indeed, while Obama remained mostly silent about the protests, his Secretary of Labor enthusiastically endorsed the union's methods.

Then came the Occupy movement.   Unlike the Tea Party Movement, the Occupy Movement has been characterized by physical attacks on the elderly , arson, sexual assaults anti semitism; vandalism,  zombie like shouting down speakers.    

Civility went out of fashion a mere few weeks after the Tucson tragedy, according the Establishment Media and President Obama.  A Google search of the word "Tucson tragedy civility"  reveals hundreds of stories about the need for civility in politics in the wake of the Tucson shootings.  A Google search "Occupy movement civility" reveals not one Establishment Media story linking the Occupy Movement with the need for civility in public discourse. Not one.  And of course, our eloquent President has been silent on the need for civility by the Occupy protestors.

Last night, Presidential candidates Herman Cain and Newt Gingrich provided the answer to the call for civil discourse in politics. In an historic Lincoln Douglas style debate on entitlements,  the two candidates delved into the issues of Medicare, Medicaid and Social Security entitlements, and how to save those programs for our children and grandchildren.  There were no "gotcha" moments, no personal attacks; only cordial discourse on the problems we face and solutions to those problems. If you did not see the debate,  I urge you to go to C-Span to watch it.   If we truly want civility in politics, Cain and Gringrich have demonstrated how it can work.