A Glimpse into the Byzantine World of Virginia Health Care

Murky

Murky

by James A. Bacon

To call the United States health care system Byzantine is to cast a slur upon the ancient empire of that name. A glimpse of the bizarre, Rube Goldberg-esque way in which the system functions in Virginia can be seen in today’s Richmond Times-Dispatch article about the state’s Certificate of Public Need (COPN) program.

A state working group is studying whether to scrap or modify the regulatory system, which requires hospitals and other health care providers to seek state approval for new or expanded medical-care facilities and the acquisition of expensive equipment. The system curtails competition by making it difficult for new enterprises to enter the marketplace, and it often ties regulatory approvals to promises to provide charity care.

In 2013, health care providers donated $1.34 billion worth of charity care to comply with the state-mandated obligations, the T-D quotes Peter Boswell, chief of Virginia’s Department of Health Office of Licensure and Certification, as saying. Statewide, 195 certificates of need are conditioned upon requirements of providers to administer free care. As an example of how that might work, the T-D says a cardiac catheterization lab might have a requirement to provide 3.8 percent charity care.

Don’t get me wrong. We need a mechanism for providing health care to poor people who fall between the cracks of government assistance, Obamacare and private insurance. This is just an insanely opaque way of going about it. That $1.34 billion is not subject to any form of market discipline or legislative review. State regulators cut deals with health care providers, and then it’s up to the providers to live up to their obligations. The state lacks the resources to audit compliance.

Assuming hospitals and other providers do comply, who ultimately pays? Do the $1.34 billion in payments come out of hospital profits? Or do hospitals simply pass on the cost by jacking up charges to paying customers? I doubt anyone really knows. If there’s one thing as opaque as the health care sector’s pricing system, it’s health care accounting.

Health care is an inherently complex business, involving trade-offs between price, quality, convenience and other factors that few consumers are equipped to make. That inherent complexity is compounded by layer upon layer of regulation, subsidy, cross-subsidy and other forms of complexity. I don’t see how it’s possible for anyone participating in the industry to make economically rational decisions. No wonder there is so much waste and inefficiency. No wonder costs are out of control. No wonder private health care insurance grows more unaffordable with each passing year. No wonder Congress felt compelled to enact health care “reform” (although the reform known as Obamacare makes the system even more bureaucratic, complex, opaque and uncompetitive).

Eliminating COPN in Virginia is not a silver bullet that will miraculously create a transparent, competitive market-based health care system. Other states have abolished COPN, and their systems are not notably lower cost or more efficient (that I know of). But it is one layer of anti-competitive complexity that Virginia legislators can strip out of the system, thereby making the state marginally less hostile to innovation and competition. Combined with other market-based reforms, it could make a difference.

If Virginia abolished COPN, what would happen to uninsured people who depend upon that $1.34 billion a year in uncompensated care? Aye, there’s the rub. Politically, it may be impossible to dismantle the program. Perhaps we are doomed to living (and dying) with an opaque, irrational and inefficient system.

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52 responses to “A Glimpse into the Byzantine World of Virginia Health Care

  1. re: ” Don’t get me wrong. We need a mechanism for providing health care to poor people who fall between the cracks of government assistance,

    …………….

    who ultimately pays? Do the $1.34 billion in payments come out of hospital profits? Or do hospitals simply pass on the cost by jacking up charges to paying customers? I doubt anyone really knows. ”

    You don’t know?

    do you doubt that bears crap in the woods ?

    Jim Bacon – you really don’t know who pays?

    come on guy.. just when you are about to run headlong into the truth – you burp..

    • I *suspect* that costs are passed on to paying hospital patients. But, in theory, hospitals could be eating the costs. I don’t know how to prove the case one way or the other. The system is so complex and opaque that hospitals can easily blame higher charges on other factors.

      • I don’t believe that hospitals “eat it”. But then again – I don’t think hospitals are as profitable as many businesses are – either.

        For those that think hospitals do “eat it” , I find it an interesting dichotomy for those who espouse free market principles…

        However, I also do not think Hospitals and Medical providers will voluntarily advertise their prices… but even if they did – buying the cheapest of anything is risky business… anyhow… especially when it’s about your life…

        I do know that Medicare now collects data and provides access to it – though not user friendly.. needs a user-friendly front-end..

        Finally – I think there are a wide variety of possibilities beyond how (or in addition to) Obamcare goes about this – but the nay sayers don’t seem to be ready, willing or able to put something together that has merit.

        This would seem to be an almost irresistible mission for those on the right who … oppose… to put together something that is a legitimate contender.. but .. it ain’t happening….even when there are numerous low-hanging fruit opportunities like this.

    • Having examined many BC/BS Federal Employee Plan slips over the years, I doubt federal employees and those covered under their policies pay much towards uncompensated care. Nor do their insurance companies.

      For example, a provider submitted a charge of $232 for some diagnostic pathology testing by a preferred provider. (If Larry’s argument is that this charge likely includes some cost recovery for uncompensated care, I’d likely agree with him). But let’s dig deeper. What did BC/BS FEP allow and pay? $18.61 and $15.82 respectively. That leaves a charge to the insured of $2.79. There is no way in h^** either the insurance company or the insured picked up the tab for uncompensated care in this instance (or in most others).

      I submit that big health care consumers, such as state or federal employees as well as employees of big companies, are not likely picking up much, if any, charges for uncompensated care from health care providers. Are those with lesser or no insurance coverage? Possibly.

      I think there is a good case that many people don’t reimburse health care providers for the costs for serving the un- and under-insured. Note I am not arguing about taxpayers or everyone with insurance here.

      • The cost shifting is not just in prices – it’s in increased treatment. Doctors and hospitals get paid for what they do – and they will order as many tests and procedures as they can .

        For instance something like a broken leg – will end up with hundreds of individual charges that will range from every aspirin, every gauze pad, ever staple … broken legs now routinely go for 10, 15, 50,000 dollars.

        If you go back and look at individual things like broken legs – you’d see an enormous increase 2-3 times inflation but you’d also see 3 -4 times as many itemized charges. every single thing no matter how small is billed.

        it’s the driver to higher and higher health care costs.

        People, in fact, are reporting wildly different “negotiated” charges these days depending on your insurance or out of pocket.

      • FYI, the undiscounted price isn’t related to the actual cost of service.

        Part of the reason the sticker price is so high, is so that the hospital can show large discounts with various insurances. It’s a show, except that people without insurance that has agreements with that provider can wind up paying sticker price.

        Right now, no one knows what things cost, and there’s no good way to find out, since you can wind up with an out of network provider without prior notice (ER, anesthesiologist, etc.)

  2. Has anyone done any analysis on how this would be impacted if Virginia joined Obamacare in all its provisions?Kentucky seems to be quite happy with the federal benefits.

    • In other words, if Virginia enacted Medicaid expansion… It stands to reason that extending Medicaid to tens of thousands of uninsured Virginians would reduce hospital payments to charity care. But even then, there still would be people falling between the cracks, so hospitals still could argue that they need to keep the COPN system in plac.e.

      • The Federal subsidies to ERs are going to be cut – no matter.

        I think the proverbial – ” the system will never be perfect” is a way to deny doing anything … if we applied it to most current laws and regulations – they’d all fail. right?

        what’s a reasonable goal beyond zero for charity once we do MedicAid?

    • well – what the expansion states are finding is a lot more sign-ups than were projected.

      ” Medicaid enrollment surges under expanded program; states worry about paying for added care”


      More than a dozen states that opted to expand Medicaid under the Affordable Care Act have seen enrollments surge way beyond projections, raising concerns that the added costs will strain their budgets when federal aid is scaled back starting in two years.

      Some lawmakers warn the price of expanding the health care program for poor and lower-income Americans could mean less money available for other state services, including education.”

      http://goo.gl/hXq7Bd

      so I’m asking – are these people who don’t use the ERs and get charity care?

      they just stay hidden and don’t get medical care.. ? just get sick and die and if we start offering them care – it will break the budget?

      serious questions here…

      • Well done, Larry. I commend you for recognizing the recent media discussion of the explosion in Medicaid recipients under expansion and the associated cost explosion. I’ll go further and agree that it’s possible that the rate of growth in costs could slow down after people have been in the program for several years. Or it might not.

        But what gets me very angry is Fairfax County legislators looking their constituents in the eye and saying the initial cost explosion will not occur. Even though both Washington and Oregon saw big increases in ER usage by people newly covered by Medicaid expansion (both with managed care plans), we were told that the same result will not occur in Virginia because we’d adopt a managed care plan. Flat out lies by elected officials.

        I agree with Larry’s point below that the feds should phase out EMTALA so that people not purchasing insurance will do so. Taking away this safety net will push more younger people to buy insurance, which, in turn, will make the pools larger and the risks shared more broadly.

        • TMT – I do try to keep it honest.. and that report is unavoidable.. it’s all over the news and even Bill HOwell tweeted it.

          But here’s the thing – if you think people are not getting medical care – think again. someone is paying for those free clinics in SW Va – and families are on the edge of bankruptcy – anyhow.

          and some – they just die – you die when you have a chronic condition and no regular care – the free clinics don’t solve that problem.

          In terms of phasing out EMTALA – I’ve yet to see a single elected official say that.. not one.. and yes TMT has nailed it. Young people will not get insurance but they believe they can go into any ER and get taken care of – and “negotiate” for a payment plan.

      • ERs don’t cover full health care. They cover to stabilize. They do not do non-emergency surgery, chemotherapy, radiation treatment, etc.

        When you don’t have insurance, there is a lot of care that you really can’t access. Part of what’s showing up is backlog – care needed but not available.

        Some of it may be errors in the projections.

  3. re: opaque and competition

    one of the things I REALLY LIKE about the Singapore Health Care system is that besides it mandating everyone have insurance – it REQUIRES all providers to advertise all prices…

    so I have a modest suggestion:

    1. – get Va out of the COPD business
    2. – approve the MedicAid expansion for the poor – accept the 2 billion
    and 30,000 jobs… stop being idiots
    3. – require all providers to advertise their prices.

  4. “Don’t get me wrong. We need a mechanism for providing health care to poor people who fall between the cracks of government assistance, Obamacare and private insurance. ”

    I do see that Larry has already commented but Geez Louise, Bacon, you are against expanding Medicaid! This is an obvious and simple first step! Helping 400,000 Virginians with federal taxes Virginians have already paid!

    Your thinking reminds me of the movie “Bull Durham” when Sarah Saradon asks the perky little blonde about her locker room tryst with pitcher Nuke Laloosh.

    “Well,” she says, “he $&*@# like he pitches. All over the place.”

  5. Excellent article. Talk about a canary in a mine shaft. This little sliver of George Orwell’s emerging world goes a long way toward explaining why Obamacare, and its ilk, are doomed to fail on all counts, and will soon amount to a looming disaster to be added to his growing list from Vets care, to IRS, to faltering economy to ISSIS, to Russia’s reset, to wherever else one might chose to look, watching the crows coming home to roost.

  6. The interesting thing is that both Heritage and CATO as well as Mitt Romney have pointed out the truth about employer-provided – that’s it not employer-provided – it’s the govt.

    150 million people have insurance because the govt allows them to buy it with 40% of the taxes exempted – that’s not only Fed and State – but FICA.

    Second – it’s the govt that requires that no one be denied insurance due to pre-existing conditions – AND that they pay no more than healthier folks.

    this is a govt entitleent – not a private sector benefit.

    If you want to see real reform take place – and stop with the childish blaming of Ocare – repeal HIPAA (that gives govt benefits to employer-provided) and repeal EMTALA

    and I guarantee you that all the foolish idiocy about Obamacare will evaporate over night with outraged people wanting to know what happened to their so-called “employer-provided” insurance.

    all of those folks would then have to go out into the market to find insurance and many would be rejected and join the ranks of the uninsured – and without EMTALA – basically not able to depend on the ERs for help either.

    The opponents of Ocare live in LA LA LAnd.. they’ve put themselves in a make-believe world where they can demonize their favorite targets but they have almost zero real understanding of how health insurance really works in America..

    • A government entitlement because health care coverage does not count as salary (unless it is a so-called Cadillac plan) and thus exempt from federal taxes? The average tax rate (in 2011) was 17.6% not 40%. So, the Gub’mint is kind enough to forgo 17.6 cents on every health care coverage dollar my employer provides. And that’s a government entitlement program? Liberal logic is always fascinating to behold.

  7. I meant Susan Sarandon, my bad. To think she’s another liberal/progressive waiting for the day to kill Liberty as established by the Founders and establish an Obama-vision totalitarian state.

  8. The problem with Obamacare was that it failed to address the real issue. The issue is skyrocketing health care costs. Obamacare did little to address that issue. Instead, it created another wealth transfer mechanism. Like a drug addled Robin Hood Obamacare steals from the young to give to the old. Kind of like the Social Security (no) trust fund.

    Meanwhile, the insurance companies have never done better. Set the time horizon to “Max” and then look at the share price of Aetna …

    https://www.google.com/webhp?sourceid=chrome-instant&ion=1&espv=2&ie=UTF-8#q=aetna%20share%20price

    The ability of America’s two political parties to split the electorate into “left” vs “right” or Republican vs Democrat is amazing. They are all Corporatist thieves. Obama is the most crooked president since Nixon. However, he’ll quickly lose that title if Hillary gets elected.

    The only politician I see on today’s stage who isn’t just more of the same is Elizabeth Warren. At least she seems genuinely interested in “we, the people”.

    • Hey, Don, remember the days when the media made a big deal about insurance company profits? Remember how evil HMOs were? Suddenly, the media has lost interest. I wonder why. Do you think it might have something to do with the fact, as you note, that insurance companies have never been more profitable than under Obamacare? Just wait, the same thing will prove true of hospitals. Health care insurance is becoming a national oligopoly. Hospitals are becoming regional oligopolies (if not monopolies) and physicians by the thousands are being incorporated in to health care systems, basically being eliminated as independent agents.

      • Right on target. Everybody’s big is getting their bread buttered big time except those patients who are not extremely wealthy. Those lesser souls will be at the mercy of a huge soulless Government crony capitalist state. If the young survive the knife of planned parenthood the death panels with short circuit their lives at the end.

    • It’s not a wealth transfer to give people the same tax breaks and protections from denial of insurance that you give to others.

      and the “problem” with Ocare is that the critics have zero alternatives to fix that “exploding” cost problem.

      • http://money.cnn.com/2015/06/02/news/economy/obamacare-rates/

        “Enrollees in Obamacare exchange plans use more healthcare than those in job-based policies, he noted.”

        “While the proposed rate hikes seem steep, they won’t hit Obamacare enrollees as hard since most receive federal subsidies.”

        Yeah, it’s not a wealth transfer.

        • but have you seen this one:

          Analysis Finds No Nationwide Increase in Health Insurance Marketplace Premiums

          Changes in Premiums

          While average premiums nationwide did not change from 2014 to 2015, there were wide differences across states (Exhibit 1). There were double-digit increases in 10 states plus the District of Columbia (Alaska, the District of Columbia, Iowa, Louisiana, Minnesota, Nebraska, New Hampshire, North Carolina, Pennsylvania, South Carolina, and West Virginia). Average premiums declined in 14 states (Arizona, Colorado, Connecticut, Hawaii, Illinois, Maine, Michigan, Mississippi, New Mexico, Oklahoma, Oregon, South Dakota, Virginia, and Washington).

          http://goo.gl/Rqth3H

          it looks different when you look at m ore than just the cherry-picked data.

          if there really is “pent-up demand’ how come some states went DOWN double digits?

          more likely there are actuarial adjustments based on the demographics of the pools – which you would expect to vary initially as sign-ups are volatile.

          • virginiagal2

            That’s not health insurance in general – it’s just the marketplace policies. Initial pricing was a SWAG – some guessed high, some guessed low.

            Overall, healthcare inflation is running about 5% per year.

        • these are the negative double digit premiums Don –

          Mississipi – -15%
          South Dakota – -20%
          Virginia -49%

          is this caused by much less demand than expected and
          must lower use that expected?

    • Part of that issue is, no one knows what costs to provide service are, and no none knows what prices are ahead of time, for any given provider, much less in a market.

      How can you have a market, and market effects to hold down prices, without that pricing information ahead of time?

  9. Obamacare was never intended to directly pull down costs – but even if it were – how would you expect that to happen in a couple of years when the problem has been building for decades?

    wealth transfer occurs when people who work and pay taxes but can’t get insurance – pay the taxes that go to fund the tax exemptions for those that have employer-provided.

    Like I said – if you want to see REAL REFORM _ REAL QUICK – take away the tax breaks and protection from denial of insurance from employer-provided and change will happen dang quick as those on employer provided go after the elected.

    Don illustrates – either ignorance or denial of the facts.

    the govt – exempts Federal + State + FICA taxes – which amount to about 40% on average… roughly along the lines of 20%+5%+15%

    why do people who work and don’t have employer-provided not get those tax breaks?

    • Tax breaks vs entitlement programs.

      In this comment you have used the right phrase. Congrats.

      • tax breaks ARE entitlements! what entitles you to a tax break for purchase of health insurance especially when others do not get that same benefit?

    • Larry!!! Ocare absolutely *was* predicated on the idea that it would control costs! It would *cut* the deficit — remember? Wow, another botched promise down the memory hole.

      • James – give me a link guy..

        and you’re confusing health care costs with the deficit…

        you can pay for Ocare without reducing health care costs..

        the two are different.

        but give me the link that shows it was supposed to lower costs

        and no – not from any of your favorite whack job sites.. it has to be an authoritative, credible site..

        and even if it was – do you expect Ocare to change something that is 3 decades in the making in two years?

        • Actually, much of what was supposed to pay for Obamacare was holding down prices. It’s not different, it was part of the plan, per interviews with administration officials.

      • I feel like I’m in a world of ignorance when it comes to Ocare.

        People seriously do not understand the facts.

        Ocare is NOT funded from the General Fund.

        so Ocare does not add to the deficit because it’s funding is not line item expenditures in the budget. You can look high and low in the US budget to look for ObamaCare line item numbers but you’ll never find them.

        Ocare funding comes from diverse sources – that apparently 99% of the critics like Don and Jim are not aware of..

        how can you truly be an informed critic if you don’t know the facts nor how the money actually works?

        so your first homework assignment is to go find out how Ocare is actually funded.

        next – Ocare funding that exceeds it’s costs – goes to the general fund – which reduces the deficit. And right now – a significant amount is going to lower the deficit because it’s intended expenses – MedicAid Expansion is much lower than expected because states have not signed up – even though their citizens are paying the taxes that fund it.

        all of that aside – how did Don get health care costs in general tangled up with the deficit?

        please explain..

        • What you’re saying, Larry, is that Obamacare hasn’t cost the country as much as expected because so many states didn’t sign up for Medicaid expansion. That’s a ringing endorsement, all right.

          • the taxes to fund it were designed to pay for all 50 states expanding MedicAid instead of requiring subsidies from the general revenue.

            It was the intent of the program.

            so there’s a rich irony here.. The GOP has opposed the expansion and has succeeded in stopping it in several states – but in doing that they have caused a surplus of money – which, by law goes into the general fund and reduces the deficit.

            that, in turn , makes it much harder to repeal through reconciliation because by the rules – if repealing a law increased the deficit – they can’t do it.

            So basically – you’re damming Ocare because it was correctly designed to fully pay for itself , right?.

            you guys kill me..

            no one here has yet to answer how Ocare is actually funded . How can one be a truly informed opponent if they do not know this basic information?

            ignorance and hypocrisy …. ouch!!

    • Larry your wealth transfer argument on untaxed health care benefits doesn’t work. You appear to be arguing that lower income people pay higher taxes because employer-paid health care premiums are not taxed. But those at the bottom don’t pay much in taxes, except maybe state taxes. The earned income credit refunds much of their Social Security tax liability.

      While I don’t necessarily oppose our tax structure, I resent any argument that people who don’t pay taxes are somehow harmed if I pay fewer. When you are ready to subject Bill Gate’s foundation to taxes like his business, I’ll listen to tax arguments.

  10. Like I said – go repeal EMTALA and go repeal HIPPA (the law that gives tax breaks to employer-provided) and see how that “wealth transfer” argument works .

    we have an inequitable system that rewards some who work and punishes others – who also work.. forcing them to not only buy out of pocket with no tax breaks but to be denied by insurance companies when those on employer-provided are protected against that.

    we sat on this system for 3 decades while more and more people lost their employer-provided and got sucked up into the GIG economy and we had no problem when young people decided they did no need insurance.. and relied on the ERs if they got hurt or injured.

    we now have an entire generation of young people who are – for all intent and purposes – walking unfunded liability time bombs – because without insurance – they ARE going to get injured, sick and OLDER and need health care and when they do – they’re not going to go to the doc-in-boxes – they’re going to the ERs for “free” care..

    Heritage, CATO, Mitt Romney and many others have pointed out the problems with the pre-Obamacare system.

  11. there’s are rich ironies with the COPN issue in Va – not the least of which how the opponents of Ocare – the GOP talk up a blue streak about free market principles.. for health care but pretends COPN is a necessary evil.

    Jim Bacon blogs and bleats til the cows come home about how we’re taking the wrong path by having the govt involved in health care – but here we have such an obvious violation of that philosophy and what does Jim do ? Well – he says – even though he’s pretty sure that the govt providing MedicAid assistance is wrong that . well. he’s not really sure how the COPN deal works and that hospitals might “eat” the costs.

    I mean.. what the do da…. he’s heck on wheels, chapter and verse on the libs “failed” approach to Health care but he’s “Not sure” about how the COPN stuff works..??

    https://youtu.be/u4ZgVRJ-H8U

    Now Jim could have said – ” this is a prime example of how costs for paying for charity care are embedded into costs all consumers pay for health care but instead he posits ” maybe the hospitals eat the cost”.

    Isn’t this like the libs saying that Dominion should eat the costs for solar and wind?

    😉

    what self-respecting free market Conservative really thinks the private sector “eats” costs… ???

    come on now.. even the Va SCC doesn’t believe THAT!

    So what Jim COULD HAVE blogged – was that Va’s COPN laws are the worst forms of hypocrisy for a General Assembly that claims that the MedicAid Expansion will “cost” money……

    This is the strange world of Conservatism these days where the stinkiest forms of free-market hypocrisy sit in plain site and Conservatives like Jim are ” not sure if they mess up the free market or not or if they do – how”

    Medicaid Expansion = bad bad massive liberal fail …

    COPN = “we need to investigate further “.

    😉

    • Larry, you’re raving. I have consistently opposed COPN, although I have also consistently acknowledged that COPN provides uncompensated care. From the viewpoint of economic rationality and market-based reform of the health care system, we need to shut COPN down. But if we shut it down, we have to acknowledge the loss of $1.34 billion a year in uncompensated care. So, yeah, we do need to investigate further. I’m sorry I’m not the doctrinaire advocate of laisseze-faire capitalism you paint me as. Of course, if I advocated what you say I should (in order to be consistent with my principles), you’d attack me for being heartless to the poor.

      I think it’s one of those damned-if-you-don’t-damned-if-you-do situations.

      • well I don’t think you’re heartless to the poor but I do think this illustrates just how doctrinaire the free market idea is – when it has no answers for this and says more investigation is needed even though COPN has been around for what – decades?

        The big hit on Obamacare and the MedicAid expansion is that :

        1. – it’s an intrusive big govt solution
        2. – it is a wealth-transfer
        3. – it’s not a free-market solution

        but isn’t COPN all 3 of these also and has been around a long time without being accused of these crimes?

        so I ask – isn’t this a little bit hypocritical – and has been so – for a long time?

        We’ve turned down the MedicAid expansion and but not COPN.

        You said – we have to figure out what to do about the 1.34 billion.

        How many opponents of the Expansion KNOW that COPN provides 1.34 billion to those without health care?

        I guess I’d say – more investigation should include how the Expansion pays for those who need health care.

        Isn’t it obvious that the Expansion gives us the opportunity to do away with COPN and we already pay the taxes that fund the Expansion?

        how much more investigation is needed to see this?

        • The problem that I see with Ocare is that it’s badly designed. The Cadillac tax piece is going to be a huge, hurtful mess. It was sold as “just the cadillacs”, but it’s estimated to hit nearly half of all health plans first year of implementation, and more every single year after that.

          Essentially, it’s going to eliminate employer provided health care – the part of the market that has protections from insurance companies – and replace it with individual plans where you have no negotiating capability. That may make economists happy, but it’s not going to be fun for the humans who actually have to use it.

          Essentially, you are going to push an awful lot of people out of good health care into high deductible plans that no one who isn’t wealthy can use.

          And the core problem is that pricing information, on the actual costs and prices of services, IS NOT AVAILABLE. This could have been designed in a far more intelligent and humane way, if people used their brains to think instead of to think of ways to one up the political competition.

          • the thing about “Cadillac” plans is this. Whether it’s 401/IRAs, or HSA/FSAs or itemized expenses – they all have “caps” .

            In other words – you can get a tax break – but it’s not unlimited. Each one has a cap beyond which there is no tax break.

            We have had the opportunity for a long time to offer EVERYONE the same tax benefits that those with employer-provided have – about a 40% tax exemption (for many,most) when you figure in the 15.3% FICA, 15-20% Federal,,and 4-8% State taxes.

            but we restricted those benefits to only those folks that got their insurance through their employer and not other people who bought their insurance – out of pocket in the market . Why did we exclude them from that benefit?

            but how would you expand this to all purchasers of health insurance without busting the budget – because right now – the employer-provided tax exemptions cost the US treasury about 300 billion a year so if you extend those same tax benefit to everyone who had a job and needed health insurance – it would boost that 300 billion to what – 500 billion?

            so how would you expand to everyone the same tax benefits without increasing the cost? You do it like you do IRA/401Ks, HSAs, FSAs, and other tax exemptions – you cap them so that everyone can have access to them rather than providing those tax benefits to some but not others – on a purely arbitrary basis.

            That would have been a much easier way than Ocare – but again I point out – we’ve had 3 decades to do something to provide more equal benefits to those who need health insurance – and we chose not to do it – not even now – when people oppose Ocare – these alternatives are nowhere to be seen.. all we see is opposition and no alternatives…

            so yes – capping high-dollar health insurance – So THAT others much lower on the scale can ALSO get similar tax benefits is a way to do it.

            in terms of the pricing.. and I assume you mean services not insurance..

            we’re up against a political philosophy that essentially says – it’s wrong for the government to require pricing info from providers.

            that it should be a “free market” with consumers “free” to make their own investigations and determinations..

            Again – this was and is an alternative to lawmakers – both Federal and State – which are dominated by Conservatives these days and WHERE are these alternatives? Conservatives do not support them or else we’d see them.

          • virginiagal2

            You’re misunderstanding the effect here.

            I’m going to run through this a step at a time.

            Employer insurance is largely priced according to claims history – most large employers are self insured. Claims history is greatly influenced by age of the employees. That’s why you see government groups, and traditional firms with long time workers, that have higher premiums, even in the absence of unions and even with reasonable benefits, and low premiums at Starbucks and Abercrombie and Fitch.

            Without pricing information to allow people to shop on price, the only way to cut those premiums is to raise copays and deductibles. Thos reductions in premiums work in two ways. One, they shift costs from being covered by insurance to being covered out of pocket – it’s not a reduction in health care expenses, it’s a reduction in what is paid for by insurance versus people. Not a savings – just a shift, and it’s shifted precisely when you are sick and potentially least able to pay.

            Two, people buy less health care because they can’t afford the copays and deductibles. Problem is, the health care they are not buying, more often than not, is something they actually needed. There was an article on this problem on NPR this week, if you want to go read it.

            Most of these “Cadillac” plans are simply groups that have older employees and what were traditionally considered reasonable deductibles (less than a thousand dollars.) They are not plans that cover plastic surgery and spa treatments – they are plans that cover your mom’s colon cancer surgery.

            Do I think personal purchases of insurance should also be deductible? Yes. So if we redid the marketplace, why didn’t we do that?

            Because a huge chunk of how the ACA is paid for is from the Cadillac tax, and because, in a decade or so, ALL plans are going to fall under the Cadillac tax. So the effect will be to make coverage cost more, for everyone paying for it, with benefits that are sparser and sparser, with higher and higher deductibles.

            It also will greatly cut into employer provided insurance. With employer provided insurance, in an insurance dispute, you have someone with negotiating power that can go to bat for you. You have someone who can help you keep the benefit and network mix you want. You do NOT have that in the individual insurance market, and you’re not going to see that there in future, either.

            I can pay a big deductible. You probably can too. I can pay for fairly expensive care out of pocket, if I have to. Do you actually think that the average poor person can?

  12. We always think that we have seen everything – namely that the US government can do nothing more to take its own reputation lower, and/or show itself be any more corrupt and incompetent than it already is, only to soon thereafter be proven wrong.

    So if you are already sick of your “Glimpse into the Byzantine World of Virginia Health Care,” then try on for size the newest scandal, this morning revelations on Federal VA health care for American War Vets found at:

    washingtonpost.com/blogs/federal-eye/wp/2015/07/20/va-manager-indicted-on-50-counts-of-falsifying-records-of-veterans-waiting-for-medical-care

    Here we find the VA actively working to strip American War Vets of their health care benefits so as to hide the VA’s own criminal fraud and incompetence in performing its mission.

  13. re: evading health care costs

    yup.. it’s widespread – and includes the VA – as well as private sector insurance companies who also routinely deny treatment and therapies to subscribers as well as the State of Virginia denying similarly to people on MedicAid.

    there is no unlimited health care – except for the wealthy. Everyone else gets rationed both public and private – .. That’s the hard truth and pulling up “examples” with the flag wrapped around them – doesn’t add anything of merit to the conversation.

    If we really wanted to help Vets – we would not have used them for disposable cannon fodder for a lie of a war in the first place, right?

  14. “If we really wanted to help Vets – we would not have used them for disposable cannon fodder for a lie of a war in the first place, right?”

    That, Larry, is a cheap, flippant, cowardly, ignorant, and highly disrespectful comment.

    • EULOGY For The FALLEN

      Thucydides spoke of war in 431 BC. He told how:

      “In the winter of that year, the Athenians gave a funeral at the public cost to those who had fallen in the war then going on. This was done according to the custom of their ancestors.

      Three days before the ceremony, the bones of the dead were laid out in a newly erected tent, and their kin and friends then brought such offerings as they pleased. Later, on the burial day, the bones were placed in the coffin of their tribe, and the coffins were borne in carts, one for each tribe, and one was left empty, upon a bier decked for the missing, those whose bodies could not be recovered. All these were carried in the funeral procession.

      As the procession wound its way to the place of burial any citizen or stranger who pleased could join along with the female relatives of the dead, already there in the possession to wail at the burial.

      On arrival at the place of burial, the dead were laid in the public sepulcher. This was located in the most beautiful suburb in the city of Athens. Here those who fall in war were always buried (save for those slain at Marathon whose singular valor had earned them interment at the spot where they fell)

      Then Pericles (son of Xanthippus) advanced to the sepulcher and delivered his eulogy:

      “Most of my predecessors here have suggested that their words here honoring those who are fallen in battle, and are now to be buried here, should be made part of the law. For myself, I believe that the worth that has displayed itself in deeds are best rewarded by honors also shown by deeds to assure that the reputations of these brave men are not imperiled in the mouth of a single individual, to stand or fall according to whether he spoke well or ill. For it is hard to speak properly upon the subject of the fallen.

      On the one hand, their brothers in battle who witnessed their passing may think that some point has not been set forth with that fullness that he knows their death deserved. On the other, a stranger to that matter may be led by envy to suspect exaggeration on the events of the death should he hear anything above his own nature or capacity. For men can endure to hear others praised only so long as they can persuade themselves of their own ability to equal the actions recounted for the fallen. And when that point is passed, envy comes in along with incredulity.

      However, since our ancestors have long stamped this custom with their approval, it now becomes my duty here to obey the law and try to satisfy your wishes as best I can.

      I shall begin with our fallen ancestors. They, who dwelt in our country without break from generation to generation, handed it down free to us by their valor. And, if our more remote ancestors deserve praise, much more do our own fathers. For they added much to what we now possess and spared no pains to be able to hand it down to us of the present generation so that now our mother country can be furnished by us with everything that enables her to depend on her own resources whether for war or peace.

      And the fruits of this country that they handed down to us alone are beyond measure, for example:

      Our constitution does not copy those of our neighbors but rather it is the pattern they imitate. Its administration favors the many of us instead of the few. That is why it is called a democracy.

      And, if we look to our laws, they afford equal justice to all in both our public and private affairs. Hence, our advancement in our country’s public life falls to the reputation we earn for capacity. Class distinction is not allowed to interfere with our merit. Nor does poverty bar the way.

      And, if a man is able to serve the state, he is not hindered by the obscurity of his condition, and the freedom he enjoys in public life extends to his private life. Thus, far from exercising a jealous surveillance over one another, we do not feel called upon to be angry with our neighbor for his doing what he likes, or even to indulge in those injurious looks which cannot fail to be offensive although they inflict no real harm.

      But all this ease in our private relations does not make us lawless as citizens. We are constrained by our laws and equally by our own private sense of disgrace. And to assure this we refresh ourselves often from business and do so with games. And we also throw our city open to the world, and never by alien act do we exclude foreigners from the opportunity of learning or observing here in Athens, although we know full well that the eyes of our enemy may occasionally profit from our liberality.

      And we trust less in system and policy than to the native spirit of our citizens, and we do so knowing full well that the education chosen by our rivals goes from their cradle to old age by painful discipline that seeks exclusively after manliness.

      Rather, instead, here in Athens, we live exactly as we please and yet we are just as ready to encounter every legitimate danger as fearlessly and competently as our rivals, indeed more competently by reason of our liberality and democracy, giving us freedom and much else to lose.

      But this is not all. We cultivate refinement without extravagance and knowledge without effeminacy. Wealth we employ more for use than for show. And we place the real disgrace of poverty not in owning to the fact, but in our declining the struggle against it, so as to transcend it.

      Hence, because of all this, the admiration of the present and succeeding ages will be ours since we have not left our power without witness, but instead we have shown it with mighty proofs. Far from needing a Homer for our eulogist, we have forced every sea and land to be the highway of our daring, and everywhere, whether for evil or good, we have left imperishable monuments behind us.

      AND SO as a result:

      Such is the Athens for which these men who today we bury, in their assertion of their own resolve not to lose her, so nobly fought and died for her instead, and well may too everyone of their survivors here today be ready to suffer as they did in her cause. For none of these men we bury here today allowed their wealth to unnerve their spirit or their poverty to shrink them from danger.

      No, holding that vengeance upon their enemies was more to be desired than any personal blessings they otherwise might gain, and by reckoning this to be the more glorious of hazards, they joyously determined to accept the risk in the business of war before them and so acted boldly with full trust in themselves.

      Thus, these men we bury here today chose to die resisting than to live submitting, and so they fled from dishonor to meet the dangers of war face to face, and, after one brief moment, while at the summit of their fortune, left behind them not their fear, but their glory …”

      This is Adapted and Edited version of The Landmark Thucydides earlier edited by Robert B. Strassler from Richard Crawley’s original translation.

      A SURVIVOR ON WAR written some 2400 years later:

      I was that which others did not want to be,

      I went where others feared to go, and did what others failed to do,

      I asked nothing from those who gave nothing, and reluctantly accepted the thought of ethereal loneliness should I fail.

      I have seen the face of terror, felt the stinging cold of fear, and enjoyed the sweet taste of a moment’s love,

      I have cried, pained, and hoped… but most of all,

      I have lived times others would say were best forgotten.

      At least someday I will be able to say I that I am proud of what I am … a MARINE.

      The writer left his name off his Banner hanging at Marine Corps Base Quantico Va.

  15. there is an additional cruel irony to those who “volunteer” … and that is how many would do so if TRICARE for families was not available?

    how well would the “volunteer” army do without TRICARE?

    I would posit that not offering TRICARE would reduce the numbers of volunteers by quite a large amount.

    here’s the truth about the VA:

    ” WASHINGTON — The American Customer Satisfaction Index (ACSI), an independent customer service survey, ranks the Department of Veterans Affairs (VA) customer satisfaction among Veteran patients among the best in the nation and equal to or better than ratings for private sector hospitals.

    The 2013 ACSI report assessed satisfaction among Veterans who have recently been patients of VA’s Veterans Health Administration (VHA) inpatient and outpatient services. ACSI is the nation’s only cross-industry measure of customer satisfaction, providing benchmarking between the public and private sectors.

    In 2013, the overall ACSI satisfaction index for VA was 84 for inpatient care and 82 for outpatient care, which compares favorably with the U.S. hospital industry (scores of 80 and 83, respectively). Since 2004, the ACSI survey has consistently shown that Veterans give VA hospitals and clinics a higher customer satisfaction score, on average, than patients give private sector hospitals.”

    what’s ” cheap, flippant, cowardly, ignorant, and highly disrespectful comment” are those that try to impugn all health care in the US by using cherry-picked examples from the VA ….

    you did just that Reed.. and it was unprincipled…in the extreme.. but expected from the likes of some these days… wanna try again?

    • You lack even the sense to be ashamed of yourself.

      Yet apparently you also lack the courage and self respect to reserve your comments for a face to face discussion with those men and women who go in harms way and lose friends daily to keep your sorry ungrateful little ass safe to sit at home tying your tasteless insults.

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