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2019-01-17 07:00 by Karl Denninger
in Health Reform , 129 references
[Comments enabled]  

Governor Idiot has decided to bankrupt California (well, ok, make it more bankrupt):

....

It directed California’s massive Medicaid system to negotiate prescription drug prices for all of its 13 million recipients, changing their benefits from a managed-care or HMO approach to one that allows the state to handle all the purchases

....

Under a proposal expected to be released as part of the state’s budget plan later this week, Newsom will ask the legislature to allow all undocumented immigrant young adults under the age of 26 to participate in the state’s Medicaid plan.

The budget proposal will also contain a plan to increase the federal subsidy for participation in Affordable Care Act policies to families of four making as much as $150,000, and reinstate the mandate requiring people to purchase health care.

Good luck with that.

First, the governor cannot "increase the federal subsidy" for ACA participation, as he cannot compel Washington DC to do anything.  What he can do is spend California's money on it.

He may be able to compel California residents to buy said policies, but that'll be challenged.  Of course out there it'll likely survive any such challenge in the courts.

He can also spend state funds on illegal invading children, but he cannot spend Federal dollars on that, so once again all of this will come out of the State's coffers.

I don't know where he thinks he is going to get the money for this, since states cannot run budget deficits.  I presume Newsom believes he can simply raise taxes but California already has ridiculously-high taxes, and this will certainly not make him any friends among those who pay them.

What happens when all those who pay taxes leave and all you have left is people who take?

We're about to find out.

Oh, and not just in California either:

New York City will begin guaranteeing comprehensive health care to every single resident regardless of someone's ability to pay or immigration status, an unprecedented plan that will protect the more than half-a-million New Yorkers currently using the ER as a primary provider, Mayor Bill de Blasio said. 

Once again, this time on a city level, the Mayor has decided that even if you're an illegal invader you may have free health care.  This of course is a lie; there is no such thing as free.  There is, however, forcing others to pay for it -- in this case somewhere around 300,000 people, all of them illegal invaders.

How long will it before all the people who live and work in NYC and actually pay taxes say "**** that!" and move?

Again, we're going to find out.

I'm looking forward to the results.

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2019-01-16 10:00 by Karl Denninger
in Health Reform , 122 references
[Comments enabled]  

I always find these sorts of articles and "dares", legislatively, to be amusing.

WASHINGTON (AP) — Challenging President Donald Trump to make good on his pledge to cut prescription drug prices, congressional liberals proposed legislation Thursday to bring U.S. prices in line with the much lower costs in other countries.

The Democratic bills stand little chance of becoming law in a divided government. But the effort could put Republicans on the defensive by echoing Trump’s pledge to force drugmakers to cut prices.

I haven't read the actual legislation -- but from the article, let's go ahead and take it on.

1. Deem "excessively-priced" patented medicines to be open to competition.  This one is rather interesting, but IMO the wrong approach.  The "threshold" is that the US price is higher than the median in Canada, the UK, Germany, France and Japan.  What's wrong with prosecuting those who collude to do same under existing, 100+ year old law -- which the medical and insurance industry has twice claimed exemption from at the USSC and lost both times?  You need no new law here -- just enforcement of long-standing existing criminal and civil law.  These are not civil issues either -- they're criminal felonies, which means there really are teeth available.  Jail a few drugmaker executives and watch how fast the problem disappears.

2. "Allow" consumers to import lower-price medications from Canada.  Under what justification did Congress ban people from buying legitimate, properly-labeled medications across national boundaries in the first place?  Drop that entirely -- again, we need no new law, just repeal of existing fraud-based "laws" that ought to be forcibly disobeyed backed up with whatever is necessary to tell Mr. Government man to BUGGER OFF.

3. Allow Medicare to negotiate with drugmakers.  Since when is government obligated to "take" any price offered?  Never, anywhere else.  So why here?  Again, this is a felony that was legitimated by Congress.  What do you call enabling a felony at gunpoint and making it "not a crime" when you're screwed by it?  I call it tyranny and thuggery.

Challenge?  Trump had three points in his campaign about putting a stop to medical monopolists.  He has done nothing.

This crap has to stop and all involved in maintaining it must be personally and politically destroyed.  No exceptions.

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2019-01-10 08:20 by Karl Denninger
in Health Reform , 181 references
[Comments enabled]  

What's this nonsense?

Our current health care system is based on a fee-for-service (FFS) reimbursement model that rewards doctors for providing more treatments than necessary because payment is dependent on the quantity, not quality, of care.

Each time you visit the doctor’s office, consult a specialist, or stay in a hospital, you pay for every single test, treatment, or procedure, even though some of these services may be unnecessary.

These unnecessary tests and treatments have accounted for $200 billion annually and have been found to actually harm patients. That’s because the FFS system is volume-based, not necessarily value-based. Therefore, any increases in the volume of care equal increases in medical errors.

The article goes on to put forward a fundamental fact of the current health system in the US, which I've pointed out multiple times over the last 10+ years in this column: The system has incentives in it to not improve infection control and to actually give you complications because they can bill you for it.  Provided said can be considered an "accident" or "just part of the risk" you can't sue them (since it's not "malpractice") and you will get the bill.

One of the items cited in that article is blood-based infections that arise from central line insertions; a fairly common procedure.  The article points out that all of these infections are avoidable and that following a specific and reasonable checklist on said procedure has been shown to reduce the incidence of such infections to statistically zero.  Yet that hasn't happened on a national, mandatory basis.

Why not?

Because if you do get such an infection they bill you for the treatment and thus hospitals do not improve their standards because they make more money by not doing so.

If that happens to kill or severely injure you - tough crap for you.

But despite the (honest) accounting here there is not one word about the root cause of the problem with the medical system in the United States -- monopolist and other feloniously illegal practices that violate not just 15 USC Chapter 1 but also both federal and state deceptive practice (that is, consumer fraud) laws.

It is generally illegal to intentionally deceive someone by omission or commission in regard to any form of transaction where value is received.  The person with superior information and a claim of expertise generally has a common-law duty to disclose.  Two idiots transacting are perfectly free to do stupid things without liability but if you take advantage of an idiot while in a knowing superior position you can and should be hammered for it.

Yet neither state or federal law enforcement has gone after any of these *******s despite the laws on the books -- in some cases, specifically in the case of 15 USC Chapter 1 which outlines felony criminal violations of law, that have been valid for more than 100 years!

We overpay not a little but a crazy amount for medical care in the United States -- by five hundred percent on average and in many cases by thousands or even tens of thousands of percent.  In addition we spend upwards of a quarter trillion dollars a year catering to people's insatiable desire to stuff fast carbs down their pie hole and literally kill themselves instead of telling them to cut that crap out or get nothing.  If they did cut that out not only would we not need to spend the money all the bad things that later come to them, such as having your foot cut off or going blind wouldn't happen.

There are plenty of people who think this doesn't apply to them -- in fact, nearly everyone thinks it doesn't.  The less-well-off are on Medicaid, and think it doesn't apply to them.  The older are on Medicare, and think it doesn't apply to them.  The working middle class have employer paid health "insurance" and think it doesn't apply to them either.

They're all wrong.

If you're on Medicaid and reach 55 every dollar Medicaid spends on you can and will be clawed back from your estate when you die.  If you happen to live in one of the more "progressive" states that has capitated Medicaid plans you're not safe from this even if you use ZERO medical services since "capitated" plans assign you a fixed amount of liability irrespective of how much service you use.  This is typically in the $400-500/month range which means if you go from 55-65 (when you qualify for Medicare) in such a state there is a hidden lien on your estate for $60,000!  When you die the state will steal that from whatever's left, if there's that much left.  Got kids?  What do they think of this?

On Medicare?  That's nice.  By 2024 it runs out of reserves and by law cannot spend more than it takes in via taxes and has in reserves.  What percentage of current Medicare spending is paid in via taxes?  About 26%.  What do you think is going to happen when three quarters of what Medicare spends now becomes unfunded?  Under current law that cannot be spent at all; either a change in the law that will instantly blow up the budget deficit by close to three-quarters of a trillion dollars a year will have to be passed or 75% of all current benefits will disappear.  You can scream all you want about "I paid in and I'm owed it" but if the latter law change is attempted the odds of it instantly detonating the financial markets and spiking interest rates is very real.

On private insurance via your employer?  That's nice.  By 2024 when Medicare blows what do you think happens if the government or medical system tries to cost-shift Medicare and Medicaid onto private plans?  Your employer either drops coverage and you have zero or goes out of business trying to pay the 200%+ premium increase and you now have both zero coverage and no job.  May I remind you that while COBRA allows you to buy into whatever plan exists when you lose your job you have to pay the full price in cash and the reason you lost the coverage if your employer blew up is that those costs were something they couldn't pay!  Got $2,000+ a month for your family health insurance when that happens?  I hope so because that's what it costs now and it will be worse -- far worse -- in 2024.

What leads you to believe you won't get hosed by this America?  You will, no matter which of the above three buckets you're in, and the vast majority of Americans are in one of the three above categories.  It is a certainty that if we don't stop this crap everyone in those three buckets above is utterly and completely screwed.

All of this can be fixed and most of it doesn't even require new law.  It just requires enforcing existing law.

There are answers, in short.  I've outlined a potential legislative and policy path; a large part of it requires no new law, and the law it does require is relatively modest.  It would stop the scams immediately and in the process collapse prices by 80% for medical procedures, drugs and devices.  It would render Medicare and Medicaid virtually unnecessary, along with all but catastrophic insurance.  Said catastrophic insurance would drop in cost to the point that it would be a few hundred dollars per year, easily affordable for nearly everyone.

We're out of time on this folks -- the politicians need to hear loudly and clearly that the above proposal, or something virtually identical to it, is not only a requirement to keep their jobs in two years if they don't do it right here and now and as a result the fiscal situation in the nation goes down the toilet both they and all in the medical profession are going to be the first people held to account for the resulting collapse and death that will result -- and since at that point all resemblance of civility will be gone any expectation that such holding to account will have anything to do with what today is considered civilized norms and behavior has a high probability of going right out the window.

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2018-06-11 07:01 by Karl Denninger
in Health Reform , 308 references
[Comments enabled]  

Well well Justice Roberts, I am writing your obituary right here and now, and should you precede me I'll publish it too, even if it costs me a lot of money to do it.

"Justice Roberts was single-handedly responsible for the destruction of the American Government via its Treasury via his idiotic and legally-infirm contortions in ruling the Affordable Care Act was in fact a tax, rather than a constitutionally impermissible command."

As I wrote at the time Roberts destroyed what little was left of the Supreme Court's legitimacy, putting the final nail into a coffin built since Wickard .v. Filburn.  He justified this in his opinion through what is really called by any means possible I shall torture the law to save it, in that he cited a claim that the Courts are required that any fair means of interpretation exists that leaves a law intact the courts are required to find it.

Of course there was no such "fair means" which he also set forth in his own opinion, stating clearly that the statute reads as a command to buy insurance ("enter into a regulated activity") and that the Constitution prohibits that.

Indeed the Congressional record on the drafting and debate makes clear (if you bother to read it, which Roberts clearly did and then intentionally ignored it, which I also pointed out in a further article) that Congress knew they could not draft the PPACA as a tax because direct taxation on other than strict capitation is unconstitutional.

In other words the US Government can assess a $10 per person tax, per person, but they may not condition the amount of the tax or its imposition on anything other than being a person.  The 16th Amendment makes legal the imposition of taxes on income.  Indeed multiple other attempts to impose such a tax without a Constitutional Amendment had been previously struck as unconstitutional, so there's not only a legislative record but a judicial one as well.

Roberts didn't care.  I've often mused if someone has a video of him buggering a little boy and used it get him to write that "opinion."

But what Roberts didn't have, because he couldn't, is the ability to time travel.  And when Congress passed the TCJA reducing the penalty for not having coverage to zero starting January 1st of next year they destroyed the Constitutionality of both guaranteed issue and community rating, since both were by the Congressional record inextricably tied to the imposition of the penalty and thus are non-severable, as is specifically stated in the Congressional record.

Without the penalty there is no tax since the inherent property of a tax is that it raises revenue.  That's now gone and it was the sole pillar on which the Roberts court decision rested.

The problem is that the rest of the law isn't inseverable and the way law works is that except where severance is specifically declared inapplicable it applies unless the result would be nonsense.

That the result of non-severance will bankrupt you does not enter in the analysis.

Thus the brief referenced herein argues that both community rating and guaranteed issue are Constitutionally infirm and thus void come January 1st.  This is a winning argument, and if there is anything approaching a justice who can actually read it wins by declaratory judgment since the precedent to judge it by is in the original opinion and as a result there is no legal ground to cover in presentation of a case or argument before the court!

But once you do that both Treasury and private industry are irrevocably and instantly ****ed.

Without community rating and guaranteed issue anyone with a pre-existing condition who becomes unemployed becomes permanently unemployable as they are uninsurable without destroying the business they go to work for.  Further, they can't engage in entrepreneurial activity either because there is no possible way for them to buy health insurance.  And finally, since the cost of that care has more than doubled since this problem was allegedly "addressed" by Obamacare they have no other option available.

I have often written about the utter necessity of getting rid of the medical monopolies as a political imperative, and for individuals to do everything in their power to get off the medical teat, which for most people means you damn well better not not be overweight or obese, you better have normal blood sugar which means no damned carbs to any material extent in your diet and it certainly means that intentional high-risk behavior like butt****ing, IV drug use or drinking to excess is an instant economic death sentence.

Of course what has occurred in the decade since Obama came to office and Pelosi and her pals rammed through their "vision" is that all of that has gone downhill in statistical terms for America.  There are more obese and abnormal-insulin and blood-sugar level people in this country than ever before, including a shocking number of teens for whom such was unheard of as recently as 30 years ago.  There has been an explosion of IV drug use including heroin and fentanyl.  And we have removed not just legal strictures but have mandated "tolerance and acceptance" under the law for extraordinarily-high risk social behaviors and in no small part covered that up with expensive, lifetime drug regimes that are utterly dependent on public financing to remain "affordable" for the vast majority of people.

The social issues are real but the cost issues exist only because neither Congress nor any State or Federal executive will take their justice departments and prosecute, throwing in jail, the medical monopolists.  Instead they kowtow to their lobbying, whining and claims of "necessity" to continue the trend of taking medical expense from 4% of GDP to nearly 20% today and beyond into the future.

Well, now the scheme is about to blow up in everyone's face.  As of January 1st those who are healthy do not need to participate and most will not.  I won't.  The "donut hole" where $25,000 - $50,000 in income has an effective tax rate of more than 80% everywhere (and close to 100% in high-tax states) is gone if you simply stick up the middle finger.

But without some means of forcing transfer payments from "someone" (the taxpayer across the entire population) to fork up $900 a month for someone like me, who needs zero routine and chronic medical care so that someone else can run up $5,000 a month prescription drug bills the latter's bill becomes unfundable.

Mr. Roberts will burn in Hell for this, as had he not tortured the Constitution in 2012 Congress would have been forced to deal with the medical monopolists and so would have Obama's administration, saving the US Government and taxpayer several trillion dollars.  You'd also be able to pay cash for virtually any medical situation, save an immediate crisis for which (if you chose to do so) reasonably-priced insurance would be available.  We're talking $100 a month or less here folks, because even the "really awful" stuff would cost one fifth of what it does now.

But all that money has now been stolen and it's gone, while the nuclear fiscal bomb left behind by Robert's outrageous twisting of reality on the back of Obama and Pelosi's intentional set of actions is now about to detonate in his, and everyone else's, face.

smiley

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2018-06-07 07:00 by Karl Denninger
in Health Reform , 238 references
[Comments enabled]  

Here it comes folks, in two reports -- one from the Medicare trustees, and the other from Social Security.

Let's start with the easy one: Social Security.

The "fear" is that it will be unable to pay full benefits (because it will have run out of bonds that are there as a buffer) in 2034.  This is predicated on a few things, so let's list them:

  • Income levels will not generally lift.  Oh really?  More to the point, neither will the cap-out point (where you stop paying every year.)  But the latter does lift every year (it's gone up a lot since I was running MCSNet) and the former is a rather-pessimistic view of the world.  It's one that might prove correct, but it's still quite pessimistic.

  • Disability has actually improved due to fewer people going on the rolls.  Gee, how many were disabled and how many didn't want to work?  Funny how people who were and are disabled suddenly become not disabled as the economy improves.  That's fraud folks, but nobody cares.  You should, because the money being stolen is yours.

  • Through 2039 (five years beyond the projected depletion date) expenditure goes up.  However, the system was designed for this; that's why it holds Treasuries and built a huge surplus while the boomers were working.  Granted, the "surplus" was immediately spent but it was replaced by Treasury bonds, which can and are being (right now) sold.  The Fed, Congress and Obama intentionally destroyed the actuarial health of the system; the current yield on a blended basis is only 3% which is about half of what it should be for a ladder of bonds of appropriate duration.  This is not small potatoes when you're talking about a couple of trillion dollars! I want to know where the handcuffs are for Congress and the entire Federal Reserve plus all of the administrations back to the 2000 tech wreck who have all deliberately suppressed yields and continue to do so today.  But for that the retirement program would probably be sound on an actuarial basis.  Note that had interest been at normal levels the difference last year would have been roughly $80 billion, along with the years prior back to 2008 and on a forward basis.  $80 billion a year is real money, especially over a few decades and in fact it's probably enough to make it through the "bump" when the boomers die!  Too bad America has forgotten what a pitchfork and torch is.

  • Note that Social Security is fairly easy to "fix."  First, we can stop tampering with rates on a forward basis.  Second, we can (and probably have to) lift either the cap on wages at a faster rate (or once on a step-function basis), modestly increase the FICA tax, or some blend of both.  A less than 3% increase in the FICA rate (both halves; you pay both even though you don't see both directly) is roughly where the line is, assuming wages do not lift faster than inflation (payouts.)  If they do some or all of that will disappear; the reason is that Social Security is a progressive system; that is, your first dollar of earnings (taxable) get you more benefit when you retire than higher earnings dollars do.  So if people shift toward the higher end (before the cap-out, at which you neither pay or get more) then the deficiency closes.

The bad news is found in Medicare.

Medicare goes bust in eight years and there is no rational revenue-raising way to fix it.

For most of us who are not 75+ it will not be there unless the medical monopolists are jailed, hung or both right now.

Yes, after trial and conviction (I still believe in due process) but if we don't do it, and I remind you there is 100+ year old law that is more than sufficient to go after this issue right here and now everyone in this nation is absolutely and irrevocably ****ed if they need medical care and are over 65 just eight years from today.

Period.

There is no payroll tax adjustment that can plausibly be passed and fix this.  Medicare was designed for a medical system that consumed four percent of GDP.  Today it's nearly 20%, or five times as much.  Cost-shifting from Medicare and Medicaid is already is screwing the rest of the public blind; there is little or no more of that which can be possibly foisted off on working people.

THIS IS WHERE THE EMERGENCY IS AND WHY I HAVE RAISED HELL ABOUT IT FOR MORE THAN TWO DECADES CONTINUALLY.  IT IS AND WAS OBVIOUS EVEN IN THE 1990s WHERE THIS WAS GOING TO GO IF NOT STOPPED.

Well, it not only hasn't been stopped the scamming has accelerated and unless the government puts a stop to all of the scams now within the next few years you are going to get reamed up the chute. 

This is no longer a "distant" threat.  It now will occur prior to the end of the next Presidential term, and any acceleration in the deficit in these programs, which will happen instantly when there is a recession, will likely bring forward that date by three to four years immediately rendering the problem both instant and catastrophic.

I have published several articles on real fixes for these issues.  One can be found here, and it's a good place to start.

We either demand it as a nation and back that demand up with whatever we need to in order to make it happen or this nation, it's economy, and our government are all gone inside of the next ten years.

Politicians will not act until and unless we, the people force them to do so.  They only care about the next election and being able to "retire" into some lobbying position at five times their government salary.

You either get off your ass now and force your government to hold the entire medical system to account under anti-trust law or you had better make damn sure you don't need medical care of any sort -- no prescription drugs, no doctors and no hospitals -- and are willing to either get on a plane (if you can) for treatment or die should that change for you.

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