Archive for 25 mars, 2010

Obama Care 20

25 mars, 2010


As I wrote in an earlier post:

No Obamacare for Obama

Democrats exempt themselves from socialist medicine

President Obama declared that the new health care law ”is going to be affecting every American family.” Except his own, of course.

The new health care law exempts the president from having to participate in it. Leadership and committee staffers in the House and Senate who wrote the bill are exempted as well.

Meanwhile, we await Mr. Obama’s explanation why if his ”historic” health care law is so great for America, it’s not good enough for him and his family.

EDITORIAL: Obamacare’s federal police force

March 24, 2010

A new army of IRS agents will enforce medical mandates

President Obama’s nationalization of health care is bad enough on its own, but the plan’s implementation will require drastic measures that are just as troubling to those who value freedom. Of particular concern is the bill’s expansion of the Internal Revenue Service.

A report released last week by House Ways and Means Committee Republicans estimated that the dreaded agency’s ranks would swell by 16,500. The newly sworn agents would be charged with ensuring the public’s obedience to Mr. Obama’s health care directives. The IRS also would enjoy the enhanced powers and budgetary authority required for monitoring the health care status of 300 million Americans on a month-to-month basis. The total cost of the effort is likely to exceed $10 billion.

The investigations will gradually ramp up until 2016, when the individual mandate tax kicks in fully. After that, if the O Force wins a second term, the unprecedented levy will fall upon citizens who fail to purchase health care coverage acceptable to Treasury Secretary Timothy F. Geithner and Health and Human Services Secretary Kathleen Sebelius. IRS agents would conduct the audits and impose a fine of either $2,085 or 2.5 percent of income – whichever is greater – on disobedient households. According to Congressional Budget Office figures, this tax will generate $17 billion by 2019.

Of course, not everyone will pay. The Democrats carved out exemptions for two of its favorite constituencies: illegal aliens and imprisoned criminals. Only law-abiding citizens will face the wrath of the IRS – a wrath that can be substantial.

Consider the case of Aaron Zeff, owner of Harv’s Metro Car Wash in Sacramento, Calif. Mr. Zeff paid his taxes on time and did everything he was supposed to do. Nonetheless, a team of IRS agents descended on his business earlier this month. ”They were deadly serious, very aggressive, very condescending,” Mr. Zeff said in describing the incident to the Sacramento Bee. His crime? Mr. Zeff reportedly owed 4 cents on his taxes in 2006.

(The story here:

That’s the type of overzealous enforcement and lousy customer service we can look forward to as IRS agents are handed more power to terrorize law-abiding Americans. The president’s plan moves us in the wrong direction. We need to dismantle, not expand, the most hated agency of the federal government. Fundamental tax reform and repeal of Obamacare would go a long way toward restoring American freedoms.

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Obama Care 19

25 mars, 2010

Just one ”small” example from a very Obama friendly state.  With a legislature known for it’s ever expanding local government and more taxes.,0,2242224,full.column

California could take big hit from healthcare overhaul

The landmark federal reforms could cost the state $2 billion to $3 billion annually. State officials say there needs to be more of a partnership with the U.S. government.

George Skelton,  Capitol Journal

5:04 PM PDT, March 24, 2010

From Sacramento

Figure $2 billion to $3 billion. That’s the state of California’s rough estimate of what national healthcare expansion ultimately will cost it each year.

Forget the Washington gobbledygook about it saving the federal treasury money over the next 10 or 20 years. Nobody seems to be able to predict federal spending over a two-month period, let alone two decades.

But if the feds do realize a net gain, as backers of the legislation predict, it will be at the states’ expense.

While Democrats in Washington have been rejoicing in victory and Republicans have been predicting Armageddon, California officials have been quietly pondering the numbers.

And it isn’t necessarily contradictory to both support a national healthcare overhaul and acknowledge that it’s likely to be another hit on California’s bleeding budget. That’s just intellectually honest.

As Gov. Arnold Schwarzenegger put it after the U.S. House passed the legislation Sunday night:

”I have always supported the need for comprehensive health reform. However, for healthcare reform to succeed, states must either have the flexibility to live within the revenues that are available to them or the federal resources to fully fund its mandates.”

On Wednesday the governor told reporters that Washington has ”shifted the funding from the federal government and said, ‘Hey, you state, we want to cut down on our deficit. So you pick up the difference. . . .’ And it will cost us $3 billion more.”

Schwarzenegger has been trying to tread lightly, expressing dissatisfaction with Congress’ final product, but not criticizing President Obama, whose goal of reform he strongly supports.

The governor struck out taking a big swing at passing his own healthcare reform for California in 2007, partly because legislators concluded the state couldn’t afford it as the economy began tumbling.

Now the burden of implementing the federal healthcare expansion will fall on the states through their various Medicaid programs. In California, it’s called Medi-Cal.

States are in such deep financial straits that not only have we already made [Medicaid] cuts, but we’re looking to make even deeper cuts,” says Kim Belshe, secretary of the California Health and Human Services Agency.

”Now we’re being asked to begin planning for the biggest implementation of a social program since Medicaid was created. . . . Medicaid is crumbling. It makes no sense to be building on a house that’s falling apart. . . .

”This needs to be a partnership with the federal government. If Medicaid is going to be the foundation for broad healthcare expansion — and right now it’s very fragile — we need changes in program flexibility and equitable financing,” Belshe says.

The Schwarzenegger administration has been seeking flexibility from Washington to pare back certain benefits, such as In-Home Supportive Services, and to tighten eligibility requirements for such programs as Medi-Cal and Healthy Families.

The $2-billion to $3-billion rough estimate of net state costs for the federal program comes from Belshe’s shop. It’s $1 billion less than the price tag calculated in December for a Senate-passed bill.

In a letter then to House Speaker Nancy Pelosi (D-San Francisco), Schwarzenegger warned that ”this crushing new burden will be added to a [state] safety net that is already shredding under billions of dollars in unfunded federal mandates.”

The House gave states more money than the Senate did for Medicaid expansion, which will begin in 2014.

Under the final version, the feds will pay 100% of the cost for new Medi-Cal enrollees for two years, reduce it to 95%, then permanently kick in 90% starting in 2020. That’s a good deal, but not the whole story. The largesse will cover only those new recipients who qualify under the overhaul’s looser eligibility rules.

The feds won’t be nearly as generous for another group of new enrollees, providing only 50% of the cost. These are the people who currently are eligible for Medi-Cal and for whatever reason — perhaps stigma — haven’t signed up. But under the new law, they’ll be forced to obtain insurance. And it’s estimated that half will go into Medi-Cal.

Actually, as part of the federal economic stimulus, the feds now are paying 60% of Medi-Cal costs, rather than 50%. But that’s only temporary.

Nobody in Sacramento pretends to thoroughly understand the complex new legislation or its potential impact on the state budget. Only that it will be a drain.

The federal government will fund higher reimbursements for primary care physicians who treat Medi-Cal recipients, but only for two years. Who pays after that?

There’ll be start-up costs of many millions in an administration strapped by civil service furloughs, vacancies and layoffs — while the front-running Republican candidate for governor, Meg Whitman, vows to eliminate 40,000 more jobs.

”Fundamentally, we all know that the state budget situation is dire and financing for Medi-Cal is precarious,” says Marian Mulkey, senior program officer for the California Healthcare Foundation.

”On balance, if the reform is fully realized, a huge number of Californians will get better care.

But at the same time, the state cost issues are very real. It’s hard to imagine this being implemented as envisioned unless we get on a more secure state fiscal footing.”

Anthony Wright, executive secretary of Health Access California, calls the overhaul ”a boon rather than a burden.”

”I don’t disagree with the fact that this may cost something,” Wright adds, ”but the benefit is so much greater.”

Yes, this may be a terrific and historic program, but it is going to cost the state money. We shouldn’t kid ourselves.

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Obama Care 18

25 mars, 2010

EDITORIAL: Obamacare fails Firedoglake

March 24, 2010

Liberals, too, were appalled by the fiasco

It wasn’t the Tea Partiers and conservative radio hosts who had the harshest things to say about Obamacare. Left-wing bloggers offered some of the sharpest attacks – and some of them made lots of sense.

From the beginning of the debate a year ago, Jane Hamsher of the influential blog Firedoglake insisted that no ”reform” without a public option would be acceptable. Her fetish for a public option was misguided, but some of her reasoning was solid.

The day after the bill passed, for instance, Ms. Hamsher wrote: ”This bill fundamentally shifts the relationships of governance in order to achieve its objectives.We have empowered another quasi-governmental, ‘too big to fail’ industry with alarming nonchalance.”

On March 17, four days before the vote, Ms. Hamsher was even harsher:

The claims made by the administration about the virtues of the health care bill are outright fabrications. As Marcy Wheeler has documented in her post entitled ‘Health Care and the Road to Neofeudalism,’ it does not control either insurance premiums or health care costs. Forcing 31 million people to buy a product they don’t want and can’t afford to use does not constitute health care reform.”

She’s right, of course. The ”individual mandate” that forces every American to purchase health insurance is an assault on liberty and clearly unconstitutional. It must be repealed.

The next sentences from Firedoglake get even tougher: ”Once again, the poor get used as human shields so corporations can be the beneficiaries of massive government bailout. Rather than actually helping the poor, this bill is a dangerous and unprecedented step on the road to domination of government by private corporate players who use it to suppress competition and secure their profits – the textbook definition of fascism.”

Ms. Hamsher helpfully provided an online link to the very definition of fascism in the Concise Encyclopedia of Economics: ”Where socialism sought totalitarian control of a society’s economic processes through direct state operation of the means of production, fascism sought that control indirectly, through domination of nominally private owners. Where socialism nationalized property explicitly, fascism did so implicitly, by requiring owners to use their property in the ‘national interest’ – that is, as the autocratic authority conceived it.”

One need not sling around labels or endorse such a loaded term as fascism to understand that Obamacare is anathema to the American system of free enterprise and limited government. Also anathema were the bait-and-switch, strong-arm, kneecapping tactics used to ram this bill into law against the wishes of an overwhelming public majority. Again, here is Firedoglake: ”Members of Congress are dealing their seats away, planning to retire after the vote is cast in exchange for appointments or other sinecures from the administration.” And ”the corruption, lies and lack of affordability that were the hallmarks of the bill” helped demonstrate ”the bad faith with which the president engaged in the health care debate.”

From right, left and center, almost anybody could see how bad a bill and distasteful a process this government takeover of health care was. It must not stand.

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Obama Care 17

25 mars, 2010

MARCH 25, 2010.ObamaCare Day One

Companies are already warning about higher health-care costs..

Democrats dragged themselves over the health-care finish line in part by repeating that voters would like the plan once it passed. Let’s see what they think when they learn their insurance costs will jump right away.

Even before President Obama signed the bill on Tuesday, Caterpillar said it would cost the company at least $100 million more in the first year alone. Medical device maker Medtronic warned that new taxes on its products could force it to lay off a thousand workers. Now Verizon joins the roll of businesses staring at adverse consequences.

In an email titled ”President Obama Signs Health Care Legislation” sent to all employees Tuesday night, the telecom giant warned that ”we expect that Verizon’s costs will increase in the short term.” While executive vice president for human resources Marc Reed wrote that ”it is difficult at this point to gauge the precise impact of this legislation,” and that ObamaCare does reflect some of the company’s policy priorities, the message to workers was clear: Expect changes for the worse to your health benefits as the direct result of this bill, and maybe as soon as this year.

Mr. Reed specifically cited a change in the tax treatment of retiree health benefits. When Congress created the Medicare prescription drug benefit in 2003, it included a modest tax subsidy to encourage employers to keep drug plans for retirees, rather than dumping them on the government. The Employee Benefit Research Institute says this exclusion—equal to 28% of the cost of a drug plan—will run taxpayers $665 per person next year, while the same Medicare coverage would cost $1,209.

In a $5.4 billion revenue grab, Democrats decided that this $665 fillip should be subject to the ordinary corporate income tax of 35%. Most consulting firms and independent analysts say the higher costs will induce some companies to drop drug coverage, which could affect about five million retirees and 3,500 businesses. Verizon and other large corporations warned about this outcome.

U.S. accounting laws also require businesses to immediately restate their earnings in light of the higher tax burden on their long-term retiree health liabilities. This will have a big effect on their 2010 earnings.

While the drug tax subsidy is for retirees, companies consider their benefit costs as a total package. The new bill might cause some to drop retiree coverage altogether. Others may be bound by labor contracts to retirees, but then they will find other ways to cut costs. This means raising costs or reducing coverage for other employees. So much for Mr. Obama’s claim that if you like your coverage, you can keep it—even at Fortune 500 companies.

In its employee note, Verizon also warned about the 40% tax on high-end health plans, though that won’t take effect until 2018. ”Many of the plans that Verizon offers to employees and retirees are projected to have costs above the threshold in the legislation and will be subject to the 40 percent excise tax.” These costs will start to show up soon, and, as we repeatedly argued, the tax is unlikely to drive down costs. The tax burden will simply be spread to all workers—the result of the White House’s too-clever decision to tax insurers, rather than individuals.

A Verizon spokesman said the company is merely addressing employee questions about ObamaCare, not making a political statement. But these and many other changes were enabled by the support of the Business Roundtable that counts Verizon as a member. Verizon CEO Ivan Seidenberg’s health-reform ideas are 180 degrees from Mr. Obama’s, but Verizon’s shareholders and 900,000 employees and retirees will still pay the price.

Businesses around the country are making the same calculations as Verizon and no doubt sending out similar messages. It’s only a small measure of the destruction that will be churned out by the rewrite of health, tax, labor and welfare laws that is ObamaCare, and only the vanguard of much worse to come.

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