Tag Archives: insurance

The Big Day

Breaking News: CJ Roberts tacks left to uphold mandate and Affordable Healthcare Law; then to the right to allow states not to expand Medicaid.

America must have some of the stupidest, least informed and most gullible people on earth, but that is another story. Today the Supreme Court finally announced their ruling that there will be comprehensive reform of our badly broken healthcare system during our lifetimes.

We learned that the 6 percent among us who don’t have insurance and don’t want it are required to have it or face a penalty*; and if the other 10 or so percent who don’t have health insurance, but want it can buy it.

John Roberts, as Zeus, ruling from on high. (DonkeyHotey)

Today we learned that the 20 or so percent of us with preexisting conditions will get to keep our health insurance or ever buy it again.

Today we learned our children up to 26 can stay on our policies or finally be forced to leave the nest and do without healthcare.

Today we learned health insurance companies will have to spend money on covering the people they insure and prove it.

Today we learned preventive care to save money (and lives) is something that can survive in our late stage form of capitalism.

Today we learned we are to get health insurance exchanges to allow us to simply and clearly compare policy costs and coverage.

Today we learned our seniors’ prescriptions will not again have a “doughnut hole” of coverage forcing countless people to do without.

Today we learned small business tax breaks will continue.

Today we learned that the 13 million adults and 3.7 million children living within 133 percent of the poverty level will be allowed access to healthcare through Medicaid – if the state in which they live isn’t so stupid as to opt-out of the 100% federally paid program – first three years and then matched on a sliding scale thereafter – today we learned that our federal government cannot penalize a state for not taking care of some of its least fortunate citizens, but we can penalize them at the ballot box.

Today we learned that those working Americans who cannot afford health insurance because they are within 400 percent of the poverty level, will get some tax credit help.

Today we learned that we are going to continue to provide healthcare to seniors, the disabled, government workers, prisoners and some of the poorest among us, while tens of millions of working and recently unemployed Americans will no longer be denied healthcare and receive help to afford it.

We already know that this is about Republican politics and the corrupt lobbying power of their masters and that any suggestion of an independent judiciary evaporated a decade ago.

We expect that Sotomayer, Breyer, Kagan and Ginsburg will, at the very least, vote to preserve most of the intent of Congress.

We knew that Scalia, Thomas and Alito would nullify the entire bill. Roberts would naturally join them unless Kennedy negotiates a narrower decision on the Commerce Clause or jumps to the other side. That didn’t happen. Kennedy stayed with the Republican nominated justices. Together they decided this was not a valid extension of the the Commerce Clause. It was Roberts who would cast the deciding vote. Citing Hooper v. California, Roberts felt “every reasonable construction must be resorted to, in order to save a statue from unconstitutionality” and concluding the law was Constitutional because it was within the right of Congress to levy a tax on individuals who do not have insurance.

The bill before the court was terribly flawed (see my Dew story when the bill passed, Hold your nose and swallow), but throwing out the entire bill with this Congress would have been devastating in lives and at terrible cost to our economy. However, a more limited ruling would have made for great political sport watching this or the next POS Congress try come up with a compromise bill to fix the problems.

In retrospect, it would have been so simple, if two years ago, President Obama had just fired Rahm Emanuel and asked Congress for a one page bill that allows all Americans to purchase Medicare at any age. Then a separate bill on expansion of Medicaid. Maybe next time.

Boiled Frogs

A recipe for a very rich stew. Serves fewer than 1%.

Cooking Directions:
In a very large melting pot, add 200+or- million domestic and imported frogs, toads, tadpoles, pollywogs and porwigles. Do not preheat. Slowly, ever so slowly, raise the heat over 50 or 60 years.

While constantly stirring, gradually add

  • 4.5+or- % average annual inflation – make sure as much of the increase as possible comes from food, health care, prescriptions, insurance and energy costs, and as little as possible comes from wages;
  • 1+or- % average annual reduction in top marginal tax rates while flattening all tax rates;
  • Easy access to cheap credit – IMPORTANT: gradually reduce access while increasing rates and fees over cooking time – whenever possible, connect credit to home ownership and inflated appraisals;
  • Deregulated banking and securities industries;
  • Offshoring of industrial jobs – IMPORTANT: gradually reduce all anti-trust protection – for the best taste, remove all regulations and protections;
  • Heaping amounts of fear, race and class baiting, nationalism, chauvinism, religious intolerance, ignorance, scandal, distortion, misinformation, spin and Republicans.

During cooking, strain off any frogs that have grown large enough to feed Wall Street.

Just prior to serving, burst any bubbles, which might have formed in housing, stock market or pensions and remove any remaining safety net.

Season to taste with extended patent protection, subverting public utilities, tort “reform”, additional sales and sin taxes, lotto, industrial waste, carbon emissions, special tax breaks for business and the wealthy, criminalization of street drugs, and high fructose corn syrup.

Bon Appétit.

If you drop a frog in a pot of boiling water, it will of course frantically try to clamber out. But if you place it gently in a pot of tepid water and turn the heat on low, it will float there quite placidly. As the water gradually heats up, the frog will sink into a tranquil stupor, exactly like one of us in a hot bath, and before long, with a smile on its face, it will unresistingly allow itself to be boiled to death. – Wikipedia

Incredibly high fictitious cost of health care

Health care reform doesn’t go into effect for 3 more years, so why is it costing really really big businesses so much right now? In the last month, company after company has announced quarterly earnings and included huge accounting charges for health care costs.

Companies announcing charge offs for health care costs
“Why? For what? And should we be scared shitless?” Glad you asked. First off, except for exercising their Supreme Court given right to paid free speech, which resulted in hundreds of millions of dollars being spent on lobbyists to fight the health care reform bill, it hasn’t cost big business a nickel. Nothing. Nada.

Here’s what has happened. Way back in 2003, under Bush/Cheney, the brain trust in charge of our government at the time, decided to add a prescription drug benefit to those on Medicare. You probably wondered at the time, “what the hell do Republicans care about seniors?” Me, too. I knew they were having a difficult time squandering the Clinton budget surpluses so they could begin starving the states, so the states, in turn, could begin starving the poor. Plus, Bush Inc. had already paid off the campaign money they’d gotten from the super rich, the oil cartels, defense contractors and Wall Street. But they still owed big health insurance, big pharma and big business and thought they might be able to buy some senior votes in Florida, so they hatched this scheme: establish a huge new subsidy to create a private for profit prescription drug insurance plan industry to buy hundreds of billions of dollars of pharmaceuticals at non-negotiable retail and provide a tax subsidy to big business to help them get rid of workers at or nearing retirement age (Medicare Part D) – a real win-win. Even got Ted Kennedy to vote for it. Except for the donut hole, a diabolical stroke of campaign genius that must have Lee Atwater wish he could have come back from hell to enjoy it. But I digress.

The 2009 law gave big business a 28% tax deduction on retiree, or early retiree drug benefits, but it was more than just another corporate tax loophole. It was a tax-free treatment of the government subsidy to pay for companies providing the equivalent of Medicare Part D – the law gave them a subsidy and let them also deduct it from their taxes. Technically, accountants, lawyers and Adam’s house cat* refer to this as “double-dipping.” Republicans and the Chambers of Commerce refer to this as “pro-business.” When the new health care reform law goes into effect in three years, the subsidy will continue, but the tax deduction big business got for spending the subsidy will end.

snake oil“Then the tax deduction was worth billions of dollars?” you might ask. No, not by a long shot. In fact, the loss of the deduction will have almost no affect at all on company valuation or profit, but they’d like us to think it does. The explanation of how they came up with such extravagant numbers and why now, is a wee bit technical. Here goes: accounting rules require companies to recognize the present value today of future cash costs for as long as they offer the drug benefits and make this adjustment by writing down the deferred tax asset balances. Another way of saying it would be, they can pick any number they want and they can do whenever they want. These announcements are big businesses’ way of attempting to influence the off-year elections with the hope that the next Congress will give them back the deduction, which they don’t really use, doesn’t have any impact on jobs, but they are greedy and like to have more of whatever they want than they would ever need and don’t mind scaring the bejesus out of us as sport.

“But these tax deductions were real, so there’s a real cost to the companies’ investors, right?” In most cases, no. Big companies don’t pay taxes in America . That’s why we have those island governments just off our shores. According to the GAO’s most recent data (why it is so old, I have no idea, but I’m guessing that it has something to with providing political cover to those who write tax law), shows that two-thirds of US corporations paid no federal income taxes from 1996 through 2005 (those include the Clinton boom years) and 94% paid less than 5%.

So tomorrow when you read, “Company X earnings down due to health care reform costs,” just smirk and turn (or click) the page.

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*A variation of “Adam’s off ox.” The form commonly used is ‘not to know one from Adam’s off ox,’ meaning to have not the slightest information about the person indicated. The saying in any form, however, is another of the numerous ones commonly heard but of which no printed record has been found. But in 1848 the author of a book on ‘Nantucketisms’ recorded a saying then in use on that island, ‘Poor as God’s off ox,’ which, he said, meant very poor. It is possible that on the mainland ‘Adam’ was used as a euphemistic substitute. The off ox, in a yoke of oxen, is the one on the right of the team. Because it is the farthest from the driver it cannot be so well seen and may therefore get the worst of the footing. It is for that reason that ‘off ox’ has been used figuratively to designate a clumsy or awkward person.” From “A Hog on Ice” by Charles Earle Funk (1948, Harper & Row).

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Note: the post was edited on 4/23/10 to correct a stupid error of fact in paragraph 3. The original post, referred to “George Herbert Walker Bush” which was fortunately caught by alert reader/writer/commenter, Cliff Green.

Health Care: When You'll Get Yours

Updated 3/19/201o to include the House Reconciliation Bill & CBO estimate.

The Democrats say it is going to pass – maybe this week. For those of you who haven’t had a chance to read all 2,009 pages (depending on which version you count) of the Senate’s Patient Protection and Affordable Care Act (AKA: HR 3590) and or even the 74 page summary – and, the 153 page House Reconciliation Act of 2010 (AKA: HR 4872), I thought you might like to know what’s in it for you. And when.

There are some really important things in the combined bill including, according to the CBO, covering an estimated 95% of our citizens – 32 million more than have insurance right now. It corrects many wrongs too long overlooked. It is a good start. Better than nothing, but miles short of wonderful. It isn’t a pretty read. It is filled with technical issues. Way too much of it is really about Medicare, Medicaid, tax policy and deals struck with vested interests (private and public interests) to get the bill passed. Way too little of it is about making health care affordable and keeping it that way for people in the middle who trying to stay there.

It is an improvement on the status quo. It will lay important groundwork for modernizing our system and making it more fair. It will reduce the deficit (while CBO estimates it will cost $940B over 10 years, it would yield a net reduction of our deficit of $138B and reduce it $1.2T over 20 years). It will save lives. And it will take years, as is typical, for it to be interpreted by our bureaucracy into policy and then by lawyers and accountants into loopholes. It is not – not even close to a government takeover – if anything, it is just the opposite – giving private industry yet another shot to heal itself.

What it may do best will also cause the most political damage to the courageous men and women who worked and vote for it: most of the bill is phased in over four years to minimize cost, allow for industry to prepare, and should it be necessary, to provide time for our politicians to fix obvious problems – but it will probably be too late to save those who will have to fall on the sword during the next election cycle for our future.

The clear winners include: seniors (prescription donut hole and no cost preventative care – note: more is expected to come from reconciliation); those over 55 being forced to accept early retirement; those disabled who need care and their families; the working poor and uninsured; all those under 26, students and especially children (OK, and their parents); small business (insurance choices and tax credits); the health insurance industry and providers (30+ million new paying customers – note: physicians and hospitals did not do as well as insurance and pharma, but I suspect, most will be relieved/happy for their patients); software developers, tech support, data managers, etc.; state governments (healthier citizens, few unfunded mandates and a dramatic reshaping of indigent care – note: reconciliation is expected to provide more help to the states on mandated Medicare changes); deficit hawks (saves taxpayer money and sets framework for future changes); and millions of patient advocates, volunteers, social workers, community health clinics and civic organizations who tirelessly help those less fortunate.

The losers: those making over $250,000 a year (.09% wage tax and 3.8% investment income tax, plus some minor changes in deductions) and especially senior health insurance executives or those with exotic medical and compensation plans; lawyers (fewer bankruptcies); and copier companies, copy paper producers and related products. Mostly the losers are those who can’t wait until 2014 – and probably the Democrats.

Was Going To Happen This Year No Matter What

  • Private health care insurance companies will immediately raise rates as high as possible – they would have whether the bill passed or not. Witness: Anthem of California’s rate hike of up to 39%. Get ready, if being ready helps. It will be ugly. There is almost nothing stopping them now or ever. They are bulletproof. A win-win-win. Without competition the market just can’t correct it, and what competition there will be, is years away.
  • Tens of thousands of employers will react to these rate hikes by either raising employee health care costs or quit providing coverage – they would have whether the bill passed or not. Good luck.
  • Millions of individuals will drop their coverage because they can’t afford it (the Robert Wood Johnson research puts the number expected to join the uninsured in the next 10 years at 18.2 million, bringing the total to 67.6 million without insurance) and play the American version of Russian Roulette betting they will survive long enough for the bill to phase in subsidies and benefits. Most would have dropped their coverage anyway. They will blame it on the economy, the private insurance companies and Washington. They should.
  • States, faced with insurmountable budget shortfalls, will cut reimbursement rates to doctors and hospitals, which will cause thousands of providers to drop Medicaid resulting in hundreds of thousands of people going without any health care (your neighbors will be among them), many of whom will die.
  • The midterm elections will be held before almost anything tangibly good in the bill changes anything. There may be hell to pay.
  • The next presidential election will be held before almost anything tangibly good in the bill changes anything, but after the taxes, fees and requirements go into effect. There may be hell to pay.

Immediate (within 90 days)

  • Those uninsured who have pre-existing conditions, will have access to a national high risk insurance pool (using private providers or via state high risk pools) with financial assistance (limits out-of-pocket costs for coverage through the pool to $5,950 for individuals and $11,900 for families annually – up to $5B in total subsidies). This is temporary and will be transitioned to exchanges in 2014.
  • Will bar preexisiting conditions on children’s coverage.
  • Will create a new reinsurance program to make coverage more affordable for early retirees (55+) – basically, a subsidy for employee-based plans to continue coverage by paying up to 80% of the cost until Medicare.
  • Gradually closes the Medicare prescription drug gap (Part D “Donut Hole”) until it is eliminated in 2020. Effected seniors will receive a $250 rebate in 2010.
  • Increases the adoption tax credit by $1,000 (begins in 2009) and extends them through 2011 (one of those unrelated to health care bones tossed to the anti-women’s right to choose lobby, before the Senate caved totally).
  • Small business (up to 35%) and small nonprofit tax credit (up to 25%) on employer’s contribution to health insurance for employees.
  • A two-year tax credit (2009 & 2010 – capped at $1B) to encourage investment in therapies that prevent, diagnose and treat acute and chronic diseases. This was an attempt to win support of doctors, hospitals and equipment manufacturers.
  • Tax relief for health professionals with state loan repayments – doesn’t affect you and me, but will give tax help to some physicians in underserved areas.
  • Provides funds to build new and expand existing community health centers, and expands funding for scholarships and loan repayments for primary care practitioners working in underserved areas – some of this is new money, most is refunding existing programs.
  • Expands low-interest student loan programs and scholarships for health students and professionals.
  • Excludes the value Indian tribal health benefits from gross income.
  • Requires creation of a web site that will identify affordable coverage by state, tax credits, and other information of interest to small business.
  • Requires another crackdown and more screening on fraud and waste.
  • Creates another council to promote health policies.
  • Provides money to Health & Human Services (HHS) to figure out and quantitatively measure just how wonderful this program is. Or isn’t.
  • Extends payment protections for rural providers who don’t do enough business to make it on their own, but help a lot of people who couldn’t get help otherwise.
  • Creates a private, non-profit institute to identify “national priorities” and compare the effectiveness of health treatments, which is an attempt to create political cover when facing lobbyists who don’t want their pet projects cut.
  • Finally allows states the option of covering parents and childless adults up to 133% of the poverty level (in some states, not typically Southern, it is felt that the poverty level is too low and their least fortunate citizens a more humane program).
  • Establishes standards and community assessments for new nonprofit hospitals which should give some political cover for local government when facing neighborhood activists in cahoots with real estate developers, bond companies, etc.
  • Gives Blue Cross a special tax deduction as long as this non-profit don’t profit by more than 15%, which was designed to get a couple of votes in the Senate. (Note: this will likely be removed in the reconciliation bill.)
  • Imposes a 10% tax on indoor tanning services because their lobby was not as effective as the cosmetic surgery lobby.
  • Codifies and clarifies economic substance doctrine and penalities (again, not health care, allowable, important).
  • Appropriates $500M a year (2010-2014) for the Community College and Career Training Grant program; creates mandatory funding of Pell Grants, funds College Access Challenge Grants and funding for Historically Black Colleges & Universities; and reforms student loans, limits interest rates and reduces income-based repayment amounts (again, not health care, allowable, important).

Six Months After Enactment (and Beginning with Your Insurance Plan Year)

  • Prohibits rescissions (practice of rescinding coverage when a person gets sick as a way to avoid covering costs) – we all should count down the days and hope we aren’t on the rescind list.
  • Eliminates lifetime and restricts “unreasonable” annual limits.
  • Requires first dollar coverage (generally, no deductible) for preventative care.
  • Allows dependent coverage until age 26.
  • Requires creation of an “effective” appeals process for coverage determination and claims and awards grants to states in order to establish consumer assistance programs in response to complaints (boy, that’s going to work in Georgia).

2011 (lower your expectations)

  • Provides a free, annual wellness visit and no-cost sharing preventive services for Medicare beneficiaries.
  • Begins a 50% discount on brand name drugs for seniors in the Medicare prescription drug gap (Part D “Donut Hole”).
  • Creates incentives for states to cover evidence-based preventative services without cost-sharing for Medicare beneficiaries.
  • Requires Medicare coverage of tobacco cessation services for pregnant women (I’m guessing that this isn’t limited to pregnant women over 65).
  • All health plans must file annual reports showing share of premiums going for care and, should their accountants really screw up, they must provide consumer rebates for excessive medical loss ratios.
  • Provides a 10% Medicare bonus payment to primary care physicians and general surgeons (which they would have done anyway so that they don’t have to actually raise reimbursement rates – permanently raising would make it look as if Medicare was in trouble).
  • Establishes a “Center for Medicare & Medicaid Innovation,” which will attempt to create methods to reduce costs while enhancing care and which sounds like such a great idea, but makes every cynic snicker.
  • Provide several important policy changes related to education slots to increase doctors, nurses and care providers, but they are so tediously complicated I suggest you Bing or Google for the details).
  • Ditto on tax code changes related to standard language, small business cafeteria plans and other technical issues which would only pain you to know at this point, unless you are planning to raid your HSA, which you’d better do before the end of 2010. Oh yeah, your W-2’s will now show the value of your health benefit.
  • Begins the transition away from Medicare Advantage – that famously popular program where we, the taxpayers, give insurance companies 15% more to privately manage Medicare which they used to expand benefits by charging recipients even more. Wonderfully conceived experiment.
  • Imposes a non-deductible $2.3B fee (split based on market share) on big pharma in return for “supporting” this bill and our government agreeing not to negotiate prices or re-import drugs for Medicare or Medicaid which would, of course, bring prices way down for individuals who will have to wait four years to see benefit.

October 1, 2011

  • Allows states to offer home and community based services rather than institutional care to disabled individuals through Medicaid.

2012 (lower your expectations even more)

  • Implement payment reforms to gain efficiencies and improve quality.
  • Incentivize quality hospital outcomes and penalize hospitals with the highest readmission rates.

2013 (chances are, this won’t be your year either)

  • Begin paying Medicare physicians based on value instead of volume to promote quality of care.
  • Requires that Medicaid payment rates for primary care services be no less than 100% of the Medicare rates.
  • Mandatory adoption of electronic filing and information exchange (expect everyone to miss that deadline) and establish a pilot program of payment bundling and provider cooperation/coordination designed to save money, and, of course, improve care.
  • Increase the itemize deduction threshold for medical expenses from 7.5% to 10% of adjusted gross income for eligibility.
  • Add a .09% hospital insurance wage tax and a 3.8% investment tax on people making more than $200,000 individuals/$250,000 family.
  • Limits the deductibility of executive (all officers, employees, board members and contract workers) compensation of insurance companies to $500,000 each per year.
  • Sets $2,500 cap on over-the-counter medications for flexible spending accounts (FSAs).
  • Creates excise tax on medical device manufacturers of 2.9% (exempts Class I medical devices, eyeglasses, contact lenses, hearing aids, and any device of a type that is generally purchased by the public at retail for individual use) to raise $2B ($3B in 2012 and beyond).

2014 (finally and outrageous to believe that some of these weren’t done in year one)

  • Insurance companies are prohibited from discriminating based on health status, preexisting conditions, and gender. They still will be able to discriminate based on age, geography, family size and tobacco use, but they are limited to discriminating on rates of no more than three times their lowest rate.
  • Annual limits are eliminated.
  • Insurance companies will be prohibited from dropping coverage of those participating in a clinical trial or denying coverage for routine care.
  • Health exchanges are established in each state (yes, state) to enable people to comparison shop, enroll and determine if tax credits for financial assistance will be available.
  • A multi-state option (really national) will be available offered by private insurance companies and, at least one non-profit.
  • Health care premium tax credits will be available for those above Medicaid eligibility and below 400% of the poverty line (currently $43,320 for individual; $88,200 for a family of four – Alaska and Hawaii are higher). These credits will be for premium and cost sharing expenses and is what will enable most of the uninsured to afford coverage. What does all of this mean? If your income is above the poverty line, but less than 133%, you’ll have to pay 2% of the cost and the tax credit will pay 98%. The scale slides up to 400% of the poverty line and indexed year to year, but basically your share would be: 133% up to 150% – 3.0%; 150% up to 200% – 4.0%; 200% up to 250% – 6.3%; 250% up to 300% – 8.05%; 300% up to 400% – 9.5%.
  • Almost everyone is required to have health insurance or pay a penalty (2014: $95; 2015: $325; 2016: $695 or 2% (increasing to 2.5% in 2016) of income up to national average cap). Families will pay half the amount for children. The only exception is if affordable insurance is not available. Sounds onerous, but they are doing this because it wouldn’t be fair to the insurance companies for an individual to purposely not have insurance, get sick knowing they can get coverage by buying a policy only when they need it – plus, they made a deal with the insurance companies to do this in return for insurance companies agreeing to pay a fee to help offset the costs of the bills.
  • No one receiving a tax credit to buy insurance would be allowed to use it for a policy with abortion coverage. States can ban abortion coverage in plans offered through the exchange. Exceptions would be made cases of rape, incest and danger to the life of the mother.
  • Employers are not required to provide coverage. However, employers with 50+ employees (companies with fewer than 50 employees are except), who do not offer coverage, and have workers who are subsidized by the government, must pay a fee to subsidize those workers – $2,000 annually for each full-time employee (there is no penalty for the first 30 employees, plus, there are a few other caveats based on waiting periods, etc. Bing it). Part-time workers are included in the calculations (two part-time workers equals one full-time worker).
  • The small business tax credit will continue.
  • Workers who qualify for an affordability exemption to the requirement to have coverage, but not for tax credits, can take their employer contribution and join an exchange plan.
  • Medicaid eligibility will increase to 133% of poverty. Childless adults will be included for the first time. For new enrollees, the federal government share will be 100% in 2014, 2015, and 2016; 95% in 2017; 94% in 2018; 93% in 2019; and 90% thereafter (funding the state mandate).
  • Medicare advantage will be eliminated by competitive bidding.
  • Impose fees providers (health insurance companies): $2B ($8B in 2014; $11.3B in 2015 & 2016; $13.9B 2017 and $14.3B after that).
  • There will be more reporting requirements for many providers to measure quality of care as a pathway toward value-based purchasing.

2018

  • Impose the Cadillac excise tax of 40% on employee plans costing more than $10,200 for individuals and $29,327 for families of four (indexed for high cost states, high risk professions and for the elderly).

2020

  • Medicare Part D (prescription drug plan) increases to a 75% discount on brand name drugs for seniors and completely eliminates the “Donut Hole.”

That’s it. Hard to believe, isn’t it? Seemingly, our entire government has spent a year developing that? Every news channel, newspaper and most blogs have spent a year reporting and debating that? Republicans could spin endlessly for a year that this, often in the same sentence, would turn us into Nazi Germany or Stalin’s Russia? Hundreds of millions spent lobbying against that? Democrats could trade all the hope and power that comes once in a generation, for this? Yes.

If it weren’t passed now, we’d just have to go through this again some day not soon enough.

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Acknowledgements:
Information, reference and documents used in this story include those from:

And others too numerous to mention. Thank you.

Buying Washington with our money

$3.8 billion. That’s how much the people you elected to Congress and the Senate took from finance, insurance and real estate lobbyists in the past 10 years. That’s right, billion.

What did they buy? Protection from regulation that would protect consumers and investors. Protection from laws that would stop the outrageous risks, self-dealing, market making, collusion and investor deception. Protection from paying ordinary taxes on their extraordinary incomes. And protection from failure to the tune of more taxpayer money than, according to The Intelligence Daily,

“… the cost of all US wars (including such events as the American Revolution, the War of 1812, the Civil War, the Spanish American War, World War I, World War II, Korea, Vietnam, Iraq and Afghanistan, the invasion of Panama, the Kosovo War and numerous other small conflicts), the Louisiana Purchase, the New Deal, the Marshall Plan and the NASA Space Program combined.”

With Congress safely in their vest pockets, the financial sector has thrived and is expected this week to announce record bonus payments – “… expected to be 30 to 40 percent higher than 2008’s.” Wall Street and the mega-banks profits have so bloated during this period that, according to Robert Creamer,

“of every 12.5 dollars earned in the United States, one goes to the financial sector, much of which, let us recall, produces nothing.”

What wait, you must be thinking, what about the regulation and reforms we were promised to keep from having to save all the firms too big to fail from failing again? Surely voters won’t stand for more of the same. The tough votes will have to be made, right? We’re going to re-regulate these companies, get transparency, watch them and enforce our laws, right?

Hate to get your hopes up. On December 11, 2009, the House passed H.R. 4173, the Wall Street Reform and Consumer Protection Act of 2009 – according to the DNC, the bill is the  “most sweeping financial regulation since the Great Depression.” DNC Communications Director Brad Woodhouse, said,

“One year after nearly the worst financial collapse in our nation’s history — a collapse brought on by the excessive greed and risk taking of Wall Street and by the anything goes regulatory environment put in place by Republicans — not one Republican in the House thinks that consumers deserve additional protections or that the practices of Wall Street should be curbed.”

The Dems writing the bill, apparently, don’t think so either. The fix was in. To get the 1,300 page bill to a vote, they caved on the enforcement provisions so that the bill falls somewhere between a tediously long suggestion and a PR stunt. Sound tough to voters, but make sure the market sees the secret wink and the nod. Sure, the bill would shuffle the regulators, asks the Treasury to report stuff to Congress, requires a lot more forms to be filled out, and adds some councils and boards. It prohibits a few new things, but also repeals some regulation on the books that could make things worse. Dennis Kucinich (D-OH) voted against the bill, believing the legislation does not go far enough. On his website, Kucinich noted the loopholes in the bill “that sophisticated financial industry insiders will exploit with ease.”

But hey, the Senate just got a hold of it. Don’t expect it to be better, shorter, or even get to a vote until spring, if then.


Recommended viewing:

Recommended reading:

Last Minute Gifting

On behalf of 46 million Americans without health insurance, 56 million Americans pre-existing conditions, and all of us who are terrified we’ll join the others, I’d just like to say, “thank you.” I know you shopped hard, had to make difficult choices on size and features, and probably spent way too much, but I just love you for thinking of me. I got a little something for you, too – my vote.

Health Care Bill Passes

Senate Plans to Order More Chickens

fox_hen_house

With so many Americans now unable to afford health insurance, the private insurance industry is facing a catastrophic problem: how to keep profits high, executive compensation exorbitant and campaign contributions excessive?

Fortunately, $200 million in lobbying and campaign contributions have convinced a majority in the senate (41 members) that the problem is not the fox or the hen house, the problem is the shortage of chickens. Agreeing with the house, the Senate will force every chicken-livered American above the poverty line and below the retirement age to get back in that hen house and act happy about it – 30 to 40 million of us.

The hen house will still be run by private, for-profit corporations not responsible to anyone (no public option, no Medicare buy-in, no co-op chicken coop in the Senate bill). Sure, insurance companies will no longer be allowed to deny you coverage because you are old or sick or male or female, but they will charge you up to 3 times what others pay. Sure, there are a lot of wonderful little rule changes that will get us on the road (roads in Iraq are safer) to real reform. Sure, individuals and tiny businesses might get the chance to enter the hen house at rates similar to groups. Sure, a few years from now there will be some subsidies to help you afford health insurance until you are poor enough to qualify for Medicaid. Sure. We’re totally screwed.

There’s a tiny chance something good could happen in conference. Or, some of the Republicans purchased by the insurance lobby would accept a bigger bribe from Obama & Company. Or, maybe, they’ll just go home for holidays and forget all about it. Personally, I think I have a better chance free range.