Tag Archives: Costs

How will Elizabeth Warren pay for her $52 trillion government-run health care plan?

So, in yesterday’s post, we talked about our current budget of $4 trillion dollars, our $3 trillion of revenues, our $1 trillion annual budget deficit, and our $23 trillion in accumulated national debt. We also talked about how Elizabeth Warren’s health care plan would add $5.2 trillion to our annual budget, and how we only get about $2 trillion in revenue if we take almost everything the wealthiest taxpayers earn.

Warren likes to talk about how her plan will reduce health care costs. She thinks that government workers (think of the DMV and the post office) will be more efficient about increasing quality and reducing costs than the private sector (think of Apple and Amazon) is. Is she correct?

Let’s take a look at this article from Reason:

Warren and her defenders will likely try to shift the discussion back to total costs, but that’s just a way of repeating the dodge that has dogged her campaign for much of the year. Warren will no doubt claim that costs would go down under her plan, but there are reasons to doubt this, including an analysis from health care economist Kenneth Thorpe finding that under a Sanders-style plan, more than 70 percent of people who currently have private insurance would see costs increase, as well as an Urban Institute analysis projecting that single-payer plans would raise national health care spending by $7 trillion over a decade.

There isn’t any magic in Warren’s plan that would lover the costs to the point where the middle class would not have to pay for her spending:

Indeed, much of Warren’s plan is based on unlikely, and at times outright fantastical, assumptions about what sort of additional revenue could be raised, what health care costs could be contained, and what might be politically feasible. Among other things, she proposes raising $400 billion by passing comprehensive immigration reform, which, given the politics of immigration policy, is only a little more realistic than planning to pay off your mortgage by winning the lottery. The Washington Examiner‘s Philip Klein has published a useful roundup of Warren’s less plausible ideas; the takeaway is that even if Warren somehow managed to raise the enormous amounts of tax she proposes, it probably would still not be anywhere close to enough to finance her plan. (More on this in a future post.)

In some ways, Warren’s plan amounts to a list of technically sophisticated magic asterisks. It is as much an attempt to obscure the economic and political feasibility of passing and implementing a single-payer health care plan as a good-faith attempt to describe what it would practically require.

Yet in another way, it reveals something about both Warren and the economic reality of single-payer: Despite running a campaign based on wonky academic credentials and detail-oriented policy chops, Warren has, until now, repeatedly refused to directly answer questions about precisely how she would finance Medicare for All and whether she would foist new taxes on the middle class. Turns out she didn’t dodge the question because the answer was complex or hard to explain. She dodged it because the answer was so simple it could be expressed in a single word: yes.

So, let’s just state the obvious. We’re talking about a person who pretended to be an Indian in order to get into Harvard, and who lied about being fired from her teaching job for being pregnant. If we’re looking at her education, we don’t find any evidence that she understands health care policy, or even basic economics. If we’re looking at her work experience, there’s no evidence there that she was ever able to produce results in health care administration. There are people who have been able to reform health care in a way that reduces costs, reduces taxes, improves quality of care, and covers more people. But not Elizabeth Warren.

Price of healthcare per Canadian household (Source: Fraser Institute)

Price of healthcare per Canadian household (Source: Fraser Institute)

What about Canada?

I think it’s worth remembering how much government-run health care costs in countries that have adopted “Medicare for All” plans.

I found two interesting studies from Canada’s Angus Reid Institute describing single payer health care in Canada. I’m very interested in find out what things are like in countries that have true government-run health care. A typical Canadian family pays $13,000+ per year per household for healthcare, or about $585,000 over their working lives. What are they getting for all that money?

Here is the first Angus Reid article:

The study finds more than 2 million Canadians aged 55 and older face significant barriers when accessing the health care system in their province, such as being unable to find a family doctor or experiencing lengthy wait-times for surgery, diagnostic tests, or specialist visits.

Moreover, most Canadians in this age group have at least some difficulty getting the care they want or need in a timely manner.

The study focuses on the health care experiences of older Canadians, as well as their assessments of the quality of care they receive.

According to the article, 31% of respondents (aged 55 and older) rated access to the government’s healthcare system as “easy”. 48% had “moderate” problems with access, and 21% had “major” problems with access.

The second Angus Reid article explains:

This second part of the study finds one-in-six Canadians (17%) in the 55-plus age group – a figure that represents upwards of 1.8 million people – say that they or someone else in their household have taken prescription drugs in a way other than prescribed because of cost.

One-in-ten (10%) have decided to simply not fill a prescription because it was too expensive, and a similar number (9%) have decided not to renew one for the same reason. One-in-eight (12%) have taken steps to stretch their prescriptions, such as cutting pills or skipping doses.

Some 17 per cent of Canadians 55 and older have done at least one of these things, and that proportion rises among those who have greater difficulty accessing other aspects of the health care system.

In a previous blog post, I reported on how Canadians have to wait in order to see their GP doctor. If that doctor refers them to a specialist, then they have to wait to see the specialist. And if that specialist schedules surgery, then they have to wait for their surgery appointment. The delays can easily go from weeks to months and even years. The MEDIAN delay from GP referral to treatment is 19.5 weeks.

Wait times in weeks (Source: Maclean's magazine)
Wait times in weeks (Source: Maclean’s magazine)

Also, the Canadian system does NOT cover prescription drugs.

Please share this article and yesterday’s because we have an election coming up, and votes need to know the facts.

New study: Angus Reid Institute analyzes Canada’s single payer healthcare system

Price of healthcare per Canadian household (Source: Fraser Institute)
The cost of healthcare for average Canadian households

I found two interesting studies from Canada’s Angus Reid Institute describing single payer health care in Canada. I’m very interested in find out what things are like in countries that have true government-run health care. A typical Canadian family pays $13,000+ per year per household for healthcare, or about $585,000 over their working lives. What are they getting for all that money?

Here is the first Angus Reid article:

The study finds more than 2 million Canadians aged 55 and older face significant barriers when accessing the health care system in their province, such as being unable to find a family doctor or experiencing lengthy wait-times for surgery, diagnostic tests, or specialist visits.

Moreover, most Canadians in this age group have at least some difficulty getting the care they want or need in a timely manner.

The study focuses on the health care experiences of older Canadians, as well as their assessments of the quality of care they receive.

According to the article, 31% of respondents (aged 55 and older) rated access to the government’s healthcare system as “easy”. 48% had “moderate” problems with access, and 21% had “major” problems with access.

Remember: in the Canadian system, you pay your money up front in taxes, and then they decide how much healthcare you will get later – and how soon you will get it. If you worked from ages 20 to age 65, then your household will have paid 45 x $13,000 = $585,000 into the system, in order to get “moderate” problems with accessing healthcare after you’re aged 55.

And the Canadian system DOES NOT cover prescription drugs.

The second Angus Reid article explains:

This second part of the study finds one-in-six Canadians (17%) in the 55-plus age group – a figure that represents upwards of 1.8 million people – say that they or someone else in their household have taken prescription drugs in a way other than prescribed because of cost.

One-in-ten (10%) have decided to simply not fill a prescription because it was too expensive, and a similar number (9%) have decided not to renew one for the same reason. One-in-eight (12%) have taken steps to stretch their prescriptions, such as cutting pills or skipping doses.

Some 17 per cent of Canadians 55 and older have done at least one of these things, and that proportion rises among those who have greater difficulty accessing other aspects of the health care system.

In a previous blog post, I reported on how Canadians have to wait in order to see their GP doctor. If that doctor refers them to a specialist, then they have to wait to see the specialist. And if that specialist schedules surgery, then they have to wait for their surgery appointment. The delays can easily go from weeks to months and even years. The MEDIAN delay from GP referral to treatment is 19.5 weeks.

But remember – they paid into the system FIRST. The decisions about when and if they will be treated are made later, by experts in the government. This is what it means for a government monopoly to run health care. There are no free exchanges of money for service in a competitive free market. Costs are controlled by delaying and withholding treatment. And no one knows this better than elderly Canadians themselves. But by the time they realize how badly they’ve been swindled, it’s too late to get their money back out. You can’t pull your tax money out of government if you are disappointed with the service you receive. There are no refunds. There are no returns.

Obamacare website won’t reveal plan costs until after midterm elections

Last year, they revealed all the plans on October 1st. What could cause them to delay the prices this year for over a month?

The Washington Times explains.

Excerpt:

Those planning to purchase health insurance on the Obamacare exchange will soon find out how much rates have increased — after the Nov. 4 election.

Enrollment on the Healthcare.gov website begins Nov. 15, or 11 days after the midterm vote, and critics who worry about rising premium hikes in 2015 say that’s no coincidence. Last year’s inaugural enrollment period on the health-care exchange began Oct. 1.

“This is more than just a glitch,” said Tim Phillips, president of free-market Americans for Prosperity, in a Friday statement. “The administration’s decision to withhold the costs of this law until after Election Day is just more proof that Obamacare is a bad deal for Americans.”

[…]The Iowa insurance commissioner approved last week premium increases for three insurance carriers: Wellmark Blue Cross and Blue Shield, CoOpportunity Health and Coventry Health. Two of those insurers will implement double-digit hikes ranging from 11.9 to 19 percent, the Des Moines Register reports.

[…]The issue is also resonating in the Louisiana Senate race, where Democratic Sen. Mary Landrieu is seeking re-election against Republican Rep. Bill Cassidy. Documents filed with the Louisiana Department of Insurance show some insurers are anticipating double-digit rate hikes, according to the New Orleans Times-Picayune.

Mr. Cassidy, who’s a doctor, issued a statement Thursday calling the higher premiums “another hurdle for families and businesses already struggling under the demands of Obamacare.”

“Premiums have gone up by 53 percent for the average Louisiana policyholder and many of these policies will again see double-digit increases,” Mr. Cassidy said. “It’s unfair to Louisianans who have to balance their budgets and their businesses.”

I can understand why the Democrats would want to keep the exchange rates private before the election. They are counting on hoodwinking the American public again – vote first, find out what’s in the bill later.

 

Thomas Sowell: is the political left really concerned about helping minorities?

Economist Thomas Sowell
Economist Thomas Sowell

Do people who talk about race the most actually favor policies to help minorities? Thomas Sowell writes about it in Investors Business Daily.

Excerpt:

If anyone wanted to pick a time and place where the political left’s avowed concern for minorities was definitively exposed as a fraud, it would be now — and the place would be New York City, where far left Mayor Bill de Blasio has launched an attack on charter schools, cutting their funding, among other things.

These schools have given thousands of low-income minority children their only shot at a decent education, which often means their only shot at a decent life. Last year 82% of the students at a charter school called Success Academy passed citywide mathematics exams, compared to 30% of the students in the city as a whole.

Why would anybody who has any concern at all about minority young people — or even common decency — want to destroy what progress has already been made?

One big reason, of course, is the teachers’ union, one of de Blasio’s biggest supporters.

But it may be more than that. For many of the true believers on the left, their ideology overrides any concern about the actual fate of flesh-and-blood human beings.

Something similar happened on the West Coast last year. The American Indian Model Schools in Oakland have been ranked among the top schools in the nation, based on their students’ test scores.

This is, again, a special achievement for minority students who need all the help they can get.

But, last spring, the California State Board of Education announced plans to shut this school down!

Why? The excuse given was that there had been suspicious financial dealings by the former — repeat, former — head of the institution. If this was the real reason, then all they had to do was indict the former head and let a court decide if he was guilty or innocent.

There was no reason to make anyone else suffer, much less the students. But the education establishment’s decision was to refuse to let the school open last fall. Fortunately a court stopped this hasty shutdown.

These are not just isolated local incidents. The Obama administration has cut spending for charter schools in the District of Columbia and its Justice Department has intervened to try to stop the state of Louisiana from expanding its charter schools.

Why such hostility to schools that have succeeded in educating minority students, where so many others have failed?

Some of the opposition to charter schools has been sheer crass politics. The teachers’ unions see charter schools as a threat to their members’ jobs, and politicians respond to the money and the votes that teachers’ unions can provide.

The net result is that public schools are often run as if their main function is to provide jobs to teachers. Whether the children get a decent education is secondary, at best.

In various parts of the country, educators who have succeeded in raising the educational level of minority children to the national average — or above — have faced hostility, harassment or have even been driven out of their schools.

Not all charter schools are successful, of course, but the ones that are completely undermine the excuses for failure in the public school system as a whole. That is why teachers’ unions hate them, as a threat not only to their members’ jobs but a threat to the whole range of frauds and fetishes in the educational system.

The autonomy of charter schools is also a threat to the powers that be, who want to impose their own vision on the schools, regardless of what the parents want.

This story reminds me of another story of people on the left blocking poor minority children from better schools, in order to protect the jobs of underperforming unionized teachers.

The Heritage Foundation explains how the Department of Justice, in a Democrat administration, hurts the poorest minority students.

Excerpt:

On August 22, 2013, the United States Department of Justice filed a motion in federal court to stop Louisiana from issuing school vouchers to low-income children in numerous school districts. DOJ is basing the suit on decades-old desegregation orders that treat Louisiana as if it were the same state it was nearly 40 years ago—something that the United States Supreme Court recently rejected in the case of Shelby County v. Holder. Ironically, DOJ’s action will prevent low-income and minority students from accessing the successful Louisiana school choice program, which empowers children, underserved in their assigned public schools, to attend schools of choice that match their learning needs. Vague, open-ended, and stale court orders should not be used to prevent educational innovation and opportunity.

Vouchers are a way of helping poor, minority students to get a quality education by letting them choose to attend better schools – any school the parents choose. But school choice is a thorn in the side of the public school unions who support the political left, because it allows poor, minority child to escape underperforming schools. Poor, minority students don’t help Democrats to get elected, but public school teachers do. And that’s why the administration sides with them against the children. On the other side of the aisle, it’s the conservatives who push for more school choice, and better education for poor and minority students.

But education policy is only one area where minorities are harmed by leftist policies.  Minimum wage is another obvious choice.

Let’s take a look at the data and see how minorities are affected by leftist policies.

Excerpt:

Battles are brewing in New York, California, Minnesota and the nation’s capital over hiking minimum wages, with Democrats having the votes to ram through hikes in all four cases.

These politicians are claiming the moral high ground, saying it will help the poorest in our communities. Don’t be fooled.

Hiking the minimum wage hurts — not helps — the lowest-paid workers, especially young black men. A 10% hike in the minimum wage causes a 2.5% drop in employment among young white men without a high school diploma and a staggering 6.5% drop among young black men without that degree.

Young black males get clobbered three times as hard because they tend to work in the fast-food and restaurant industries, where any increase in labor costs produces layoffs.

[…]Only 5% of American workers earn the federal minimum, according to the latest government data, compared with 13% in 1979. Minimum wage workers are largely first-time workers. They are learning what all of us learn on our first job: to be prompt, dress appropriately, do what the boss asks and be reliable.

First-time workers face the biggest risk of being priced out of the job market by a minimum wage hike. They aren’t worth much to an employer when they start working. They don’t have the skills.

When the government increases the minimum wage, it’s more expensive to hire first-timers. According to David Neumark and J.M. Salas, University of California economists, and William Wascher of the Federal Reserve Board, “minimum wages tend to reduce employment among teenagers.”

[…]All teens are harmed, but black male teenagers are hit hardest by minimum wage hikes, according to a 2011 study by labor economists David Macpherson and William Evans. Unemployment among young black males is currently 29%, double the rate for young white males.

Macpherson and Evans found the reason is that one out of three young black men without a high school diploma works in the restaurant/fast-food industry, where profit margins are thin. Any labor-cost hikes compel these businesses to cut their workforce.

The truth of the matter is that the real minimum wage is zero. In order to help minority young people find jobs, we should strengthen the institution of marriage, encourage people to get married and stay married, lower taxes on businesses, lower regulations on businesses, and so on. But strangely, the people who talk the most about helping the poor and poor minorities in particular are all opposed to that. The Democrats won’t even build the Keystone XL pipeline or expedite other energy development initiatives to create good paying jobs. So don’t believe that people who talk the most about poverty actually have the right answers about how to solve it. After all, the Obama administration talked a lot about health care, but clearly the people who lost their doctors, lost their health care, or are paying more for less health care, do not now believe that Obamacare was the answer to the health care problem.

If you’re looking for a good recent study on the minimum wage and minority youth, take a look at this study from the Employment Policies Institute. More studies here in a previous post on this blog.

Obama administration report: 65% of small firms face Obamacare premium hikes

From Investors Business Daily.

Excerpt:

Released into a news black hole last Friday, an official Obama administration report finds that ObamaCare will push premiums up for two-thirds of small businesses. Cross off another ObamaCare promise.

The report came from the actuary for the Centers for Medicare and Medicaid Services — which means it’s from the administration’s official ObamaCare number cruncher.

What it found was that 65% of small businesses that offer insurance will likely see their premiums rise thanks to ObamaCare. That translates into higher insurance costs for 11 million workers.

The reason? These companies generally employ younger, healthier workers and so had been paying lower-than-average rates.

But since ObamaCare bans insurance companies from considering health when setting premiums, these companies will get hit with higher costs.

“We are estimating that 65% of small firms are expected to experience increases in their premium rates,” the report said, “while the remaining 35% are anticipated to have rate reductions.”

The report doesn’t say how big these hikes will be, but we have good reason to believe the extra costs will be significant.

One study, for example, found that 63% of small employers in Wisconsin will see premiums jump 15% because of ObamaCare. A separate study found that 89% of small companies in Maine would see rate hikes of 12% on average.

Another, by consulting firm Oliver Wyman, concluded that ObamaCare would push up small group premiums nationwide 20%.

Is this how the bill was sold to us by the Obama administration and their supporters in the mainstream media?

No:

In 2009, Obama promised small businesses that his plan would “make the coverage that you’re currently providing more affordable.” Later he said it would drive small-business premiums down by 4% in its first year, and as much as 25% by 2016.

As recently as last summer, Pelosi was proclaiming that “if you’re a small business … it lowers costs,” while Waxman said the law would make “high-quality healthy insurance more affordable and more widely available for small businesses.”

Notice that nowhere — either before or after ObamaCare passed — did any Democrat say anything about two-thirds of small businesses paying more for health coverage so the lucky one-third could get rate cuts.

Next time you hear a big government liberal promising you goodies at no cost, keep in mind their record. They are making policy from emotions, not from mathematics. They believe that they are lying to you for your own good. Their goal is not to tell the truth at all. And don’t rely on the left-wing journalism crowd to hold them accountable, they flunked math too.