GOP House Agenda Released

Delegate Clay Athey has released a list of nine House GOP initiaitves for the 2006 General Assembly to today’s Winchester Star. You may need to sign on to the site (winchesterstar.com) to read the story. The nine bills he mentioned include several that have been proposed before and some new ones. More detail is likely to follow in coming days, as will more bills.

1) A pre-school sales tax holiday.
2) Increased revenue sharing for local transportation projects. Athey predicts a number of transportation bills, as everyone expects.
3) A tighter definition of “public use” in state law in response to the Kelo case on eminent domain.
4) Medicaid Health Savings Accounts.
5) Incentives for long term care.
6) Continued funding for the Chesapeake Bay clean up and the required local sewage plant upgrades.
7) More enforcement to reduce illegal immigration (as discussed in the campaign)
8) Final passage of the proposed amendment limiting marriage in Virginia to a heterosexual couple and preventing recognition of same sex marriages elsewhere. It passed in 2005, too, so the goal is to have it on the ballot in 2006.
9) Bills to fight the rise of gangs and increased trafficking in meth.

When you go to the legislative information page it has already switched over to the new 2006 template and bills are starting to appear. Snow on the ground, bills being filed. It’s beginning to look alot like…session.


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27 responses to “GOP House Agenda Released”

  1. Anonymous Avatar

    The only thing of substance here is the Bay funding. The school tax thing is strictly a gimmick–I know because I introduced it first in Virginia, having stolen the idea from New York and Florida. Jack Reid subsequently introduced it, and I think Vance Wilkins did. There is no revenue to share on transportation–unless we take the “savings” Marty Williams’ proposed gutting of VDOT–once the pride of the nation–produces some. And it will–by taking millions “off budget,” a fiscal sleight-of-hand perfected by George Allen. Border guards along the North Carolina and West Virginia boundaries? Hey, that could double as a Republican “jobs” program, especially across Southside! Kelo? Terrific breast-beater issue, but the last time I looked, state legislatures don’t trump the Supreme Court–Barnie Day.

  2. Blackstone Avatar
    Blackstone

    Ole Barnie gets it right–particularly with his note that the “pre-school tax holiday” is a bit of political fluffery.

    He does need some correction, however, on the Kelo decision. The U. S. Supreme Court’s decision was not one that limited the states power. It basically said that the states were not limited by the fedeal constitution on the “uses” for which property could be condemned (we still have the right to “just” compensation–whatever that means). So the states can limit themselves–which Virginia should do.

    Not only that, the State of Virginia should limit the uses for which public service companies can condemn private property. For instance, if a pipeline company wants to run its pipeline through your yard, it should be limited to that paticular stated use. If it later wants to run some broadband wire along that easement–it should have to pay separately for that–now it doesn’t.

    In addition, if one public service company already has an easement across a piece of land a second company seeking an easement should be required to locate in the existing easement.

    Of course these proposals will provide “full emplloyment” for the lobbying community, since the utilities get “all atwitter” when anyone starts thinking about private property rights in their sphere of influence. We’ll see how much stomach Mr. Athey has for this…or is it just window dressing and press release?

  3. Jim Bacon Avatar

    It’s nice to see that I agree with Barnie on occasion: I share his conviction that the pre-school sales tax holiday is a political gimmick. We should strive for the very opposite — fewer special exemptions for favored groups and causes. Our tax code is riddled with special exemptions for various privileged groups. The consequence is (a) that the sales, income and other taxes bring in less revenue than they otherwise would and that (b) the state raises general tax rates to compensate. The Commonwealth should strive for a level playing field in taxes, with as few exemptions as possible and the lowest rates possible.

    Virginia Republicans, it appears, have abandoned a basic principle of their hero, Ronald Reagan, who championed tax simplification and lower tax rates. Shame, shame, Republicans! Where are your principles?

    On the eminent domain issue, I totally agree with Blackstone. The Kelo ruling opened the door wide for abuse. As a Democrat and a liberal, Barnie should be appalled by Kelo — as are many of the Democrats and liberals that I converse with. The Kelo ruling favors the rich, the powerful and the well-connected over the poor and the powerless. Property rights protect the weak against the strong, who frequently wield the coercive power of the state to advance their interests. Shame, shame, Barnie!

  4. Anonymous Avatar

    Jim, don’t be such a nitwit. Of course I’m ppropriately “appalled” by Kelo–just as I am appalled by the ability of a private, stock-holder enterprise such as Duke Power to seize private property here in Patrick County through condemnation for construction of a pipeline. Do I think state legislatures can, in effect, nullify Supreme Court rulings? No. Will Republicans get some mileage on this thin gruel? They will–from dopes of all persuasions.–BKD

  5. Anonymous Avatar

    While I don’t necessarily agree or disagree with the tax holiday for school supplies, it concerns me to see that you consider Virginia’s families with children as “favored groups and causes” or “privileged groups”. The proper education of children affects the entire community. If you don’t have school-aged children, your neighbor’s children are still partly your concern. Lower education equals higher crime and a community that is ill-prepared for the future no matter whose neighborhood the children live in. I’m a firm believer in the old saying that it takes a community to raise a child.

    On another note, maybe there would be some other alternatives to the tax holiday. Maybe the schools could provide the supplies like some private schools do for a set “tax-free” fee as they do other school fees. Something needs to be done though. In the current system, if a child can’t afford the proper supplies (markers, pens, pencils, paper, etc.) the kids are pretty much left to relying on the other children and their parents to take it upon themselves to quietly send some in. The teachers have to ask the parents to donate VCRs, paper, glue, etc. It shouldn’t be this way. All children should have the supplies they need to be properly educated and they shouldn’t have to beg other students to have them. I certainly don’t mind sending them in but I do feel for the children that have to beg.

  6. Blackstone Avatar
    Blackstone

    I tried to post in reply to Mr. Bacon but my efforts seem to have failed. Here goes again.

    The Kelo decision didi not alter the law in Virginia that I can determine. Article I, Section 11 of the Virginia Constitution states “…the term ‘public uses’ to be defined by the General Assembly….”

    In 1953, in the case of Hunter v Norfolk Redevelopment, the Virginia Supreme Court held that once the condemning authority acquires property it may sell that property to a private individual “as the public welfare may demand.” Thus it has been. Local governments or their agencieshave been condemning blighted areas in this state for years to be developed by private interests. And what about property condemned by public service companies? Can’t they use it or sell it for non public service purposes once their public service use has been served?

    But haven’t we had this discussion before, Mr. Bacon?

  7. Jim Bacon Avatar

    The point, Blackstone, is that the General Assembly wants to create a narrower definition of “public purpose.” Even before Kelo, there was a move to restrict the definition, but it didn’t get anywhere. The Kelo ruling expanded the definition so broadly that sentiment has now shifted in favor of doing something.

    I am looking forward to the “Public Private Partnership Forum” later this month to find out more about what the House leadership has in mind.

  8. James Atticus Bowden Avatar
    James Atticus Bowden

    I’d like to see what the numbers are on the sales tax for school supplies gimmick.

    What is the median (not mean) expense per family (median family of x kids) which equals how much savings per family with the sales tax holiday?

    Then what is the same median family cost each year for all sales taxes?

    Then how much would be the savings of the roll back of the .005 cents increase in sales tax for that family?

    Anybody got the numbers?

  9. Anonymous Avatar

    On Holiday from the Sales Tax
    Customers love them. Merchants applaud. Sales-tax holidays provide temporary, modest tax relief, but opponents say they’re just another layer in an overly complex sales tax system.

    ——————————————————————————–

    By Mandy Rafool
    Attention shoppers: There will be no sales tax on select items for one week in August. Plan your purchases accordingly.

    Announcements like this are becoming more widespread as states across the country grant shoppers a temporary reprieve from the sales tax. The concept of sales tax holidays, in which certain items are exempt from the sales tax for a period of time, has really caught on with lawmakers over the past few years as a way to provide tax relief that is modest and temporary. Sales tax holidays have grown from one state in 1996 to seven in 2000, and several more are pondering the idea.

    NEW YORK FIRST
    New York was the first state to approve a sales tax holiday in 1996. Bowing to pressure from retailers who argued that they were losing business to Connecticut, Massachusetts, New Jersey and Pennsylvania where clothing isn’t taxed, the Legislature instituted the first tax-free week in January 1997. All clothing and footwear priced under $500 was exempt from the state sales tax. Local governments were given the choice of opting in or not. Most counties and cities did suspend local taxes during the holidays. In New York City savings equaled 8.25 percent.

    The holiday was considered a success, and New York shoppers went on to benefit from two tax-free shopping weeks per year for three years as lawmakers experimented with different seasons and price limits in an attempt to gauge shopper response and the costs to state and local governments. Then on March 1, 2000, New York switched to a permanent sales tax exemption for clothing and footwear selling for less than $110. Participation by local governments is still optional.

    Florida was the second state to approve a sales tax holiday in 1998. Supporters touted the idea as a way to provide tax relief to families who spend hundreds of dollars shopping for “back-to-school” clothes. They were convincing, and the first sales tax holiday exempted clothing under $50 from the sales tax for one week in August. Lawmakers have approved two additional sales tax holidays since that time and raised the price limit to $100.

    The Texas Legislature followed in 1999 and enacted an annual back-to-school sales tax moratorium on clothing and shoes costing less than $100. Interestingly, this legislation had a new twist: It made the holiday an annual event. Every year, during the first weekend in August, the sales tax holiday goes into effect.

    This year, legislatures in Connecticut, Iowa, Maryland, Pennsylvania and South Carolina approved sales tax holidays. Connecticut, Iowa and Maryland followed existing models, but Pennsylvania and South Carolina broke new ground by exempting personal computers and other back-to-school items.

    Connecticut law already exempts clothing and footwear items that cost less than $75 from the state sales tax, but the legislature decided to give taxpayers a bigger break with a yearly holiday. For one week in August clothing and footwear priced under $300 is exempt.

    SUCCESS IN IOWA
    Iowa established a two-day tax holiday in August each year, temporarily lifting the sales tax on shoes and clothing priced under $100. To help retailers, the revenue department published guidelines in an attempt to minimize confusion. Revenue officials made it clear, for example, that it was against the rules to split a pair of shoes that cost $120 into two items and sell them for $60 each.

    Many Iowans felt that the first sales tax holiday was so successful that lawmakers should consider expanding it next year. “We’ve heard absolutely fantastic reports throughout Iowa about the volume of sales during the two-day period,” said Jim Henter, president of the Iowa Retail Federation. He said initial reports indicate that clothing sales were up 30 percent to 80 percent. Sales were especially strong in border areas. This is consistent with reports from officials who agree that many people simply crossed the state line to do their shopping.

    During the 2000 legislative session, Maryland lawmakers designated the week of Aug. 10-16, 2001, as a tax-free week. Similar to other states, clothing items priced under $100 will be exempt from the sales tax during that week.

    Pennsylvania, on the other hand, took a different approach. Governor Tom Ridge actively promoted the idea of a tax-free holiday on personal computers for nonbusiness use. He claimed this would help equip Pennsylvania citizens with computers and move the state one step closer to becoming a technology leader. “Other states have tried a sales tax holiday on clothing-and it’s been successful. Of course, our clothing already is tax-free,” said Governor Ridge. “So we want to go a different way.”

    “TAX-FREE PC” WEEK
    The Pennsylvania holiday has become known as “tax-free PC” week. In truth it is two separate weeks, the first was Aug. 6-13, and the other will be in February. Early reports from office supply chains indicate sales increased by as much as 60 percent during the first week. Sales weren’t limited to computers; software and hardware purchased with a computer also were exempt. In general, computer buyers saved about $50 to $85 in sales taxes. The state department of revenue estimates approximately $8 million in lost revenue as a result of the two tax-free weeks.

    The Pennsylvania holiday opened the door to new ideas, and South Carolina quickly came up with one of its own. The sales tax holiday approved by the South Carolina General Assembly is an annual event that will occur the first weekend in August. However, this holiday is quite different from those in other states. For one thing, there is no price limit. Everything on the approved list is exempt, regardless of cost. In addition, the exemption is much broader and includes anything classified as a back-to-school item. The list includes things many students consider basic such as clothing, shoes, school supplies, computers and software, but it also includes items not typically associated with going back to school such as fishing waders, hunting gear, ski boots, corsets, corset laces, furs and in-line skates, to name a few.

    After the holiday, many retailers compared the weekend to the day after Thanksgiving, which is, by most accounts, the busiest shopping day of the year. Sales at some stores were up nearly 200 percent over the same day last year. While the holiday was generally considered a success, it needs some refining. There was quite a bit of confusion and criticism about the exemption list. Representative Harry “Chip” Limehouse III, sponsor of the bill, says the holiday needs to be redefined. “I believe we ought to treat all of our merchants and consumers in an evenhanded fashion by providing them with an across-the-board sales tax break on all retail items sold … or we ought to maintain the original integrity of my proposal and limit the sales tax break to back-to-school items only,” he says.

    But not everyone is complaining. Jim Hatchell, director of the South Carolina Merchants Association, says the holiday was “far better than anyone expected. It was an outstanding weekend with many exempt items, including computers, selling out. I think the holiday will turn out to be revenue neutral for the state by the time they calculate the increase in sales on nonexempt items.” State officials projected the state would lose $4.5 million.

    Who benefits from sales tax holidays? Lots of people do. State elected officials benefit because the holidays are high profile and politically popular with voters. In most cases they are temporary and don’t permanently erode the state tax base. Therefore, they provide a fiscally safe way of reducing revenue when a state has a surplus.

    For consumers it’s more than just the savings. It’s the thrill of not having to pay taxes. “Getting something from the government” is appealing. The savings during tax holidays ranges from 5 percent to 10 percent. Though it can be significant to a family for back-to-school shopping, it’s really not much compared with other store specials. A big end-of-season sale might offer savings of 25 percent to 50 percent.

    Retailers also benefit from tax holidays because more people shop and their sales increase. Unlike regular store sales, retailers’ bottom lines don’t suffer when the sales tax is removed. And the media promotes the event. In fact, it’s like a giant statewide sale that pays for its own advertising. But there’s a downside for retailers. Such short-lived tax exemptions force them to reprogram their computer systems for an event that lasts a few days. And they have to plan for large volume increases, which might mean beefing up staff and inventory. Some have also noted that shopper anticipation of the tax-free days may stall sales before the event.

    WHO LOSES?
    Who loses from sales tax holidays? The answer is not as straightforward. States lose sales tax revenues on the exempt items, but in a robust economy many states are looking for ways to reduce revenues. In addition, the revenue loss may be offset by increased sales on nonexempt items. There are those, however, who advocate permanent tax rate reductions and claim that sales tax holidays are just another state gimmick.

    Opponents of sales tax holidays cite the increased administrative burden to retailers as a big reason to lay off the holidays. They claim that over the years, states have created very complex sales tax systems. For example, every state has its own sales tax base and defines what items are taxable or exempt. In addition, some states allow local governments to create their own sales tax bases that may differ from the state’s. This system imposes an enormous burden on sellers who operate in several states who must comply with all these different rules. Therefore, when it is already difficult to keep track of which governmental entity is taxing what and when, exempting certain items for a short period of time only adds to the problem.

    Aside from the administrative complexity of temporary exemptions, some of the biggest protests about tax holidays have come from local governments. In some cases, they may have issued debt and are counting on the tax to pay off bonds, so they can’t afford to lose the cash flow. While states may be flush, that is not always the case with local jurisdictions. And unless the state guarantees to make up what is lost, many local governments aren’t buying off on sales tax holidays.

    Regardless of what the critics say, sales tax holidays are likely to continue next year and as long as states have surpluses to burn. The idea is particularly interesting to policymakers in states that border those that have tax holidays. Retailers in Georgia, Oklahoma and Nebraska all have complained that residents in these states are crossing state lines to shop. Representatives of the Oklahoma Retail Merchants Association said the tax-free weekend in Texas was horrible for Oklahoma stores. Representative Danny Hilliard agreed that Oklahoma needs a tax holiday. He sponsored a bill last session that would have given shoppers a three-day sales tax break during the first weekend in August. The bill was passed by both chambers, but died in conference. It will almost certainly come up again in 2001. Tax holiday legislation has also been discussed in Colorado, Michigan, Missouri, Ohio, Virginia,West Virginia and Wisconsin in past sessions.

    So what began as a way to help retailers in New York compete with neighboring states, has become the latest craze in state tax relief. States, flush with cash, are looking for ways to give money back to taxpayers. Sales tax holidays seem to be an easy way to do it.

    Mandy Rafool specializes in tax issues for NCSL.

    ©2000, National Conference of State Legislatures. All rights reserved.
    –Barnie Day

  10. Blackstone Avatar
    Blackstone

    Ahhh…Mr. Bacon, the Kelo Decision did not expand the definition of permissable uses for condemnation in Virginia as a practical matter. Lcalities have been using it for development purposes for years. George Allen’s “Disney Project” would have revelled in it.

    What will be interesting is your visit with the “House Leadership”(now THERE’S an oxymoron). I imagine there will be great alarums and excusions about private property and the individual. Bills will be introduced, principles will be declaimed…..Then…the sounds of footsteps in the night will be heard in the halls of the General Assembly. Lobbyists will begin their work, amendments will be introduced, studies proposed, carry-overs suggested….the great watering down will have begun.

  11. Anonymous Avatar

    I’d like to go back to a line from the very first comment in this thread: “The only thing of substance here is the Bay funding.”

    I whole heartedly agree. In FY 04 Education received nearly 40%, or 9.4 BILLION of the Virginia’s entire budget and Transportation got another 13.5%, or 3.4 BILLION of the budget. I think most Virginians would be appalled to know that all Natural Resources programs received less than 1%, or 243 MILLION of the total budget. This less than 1% has to be divided amongst all natural resources programs. (Air, water, land conservaton, etc.)

    The Secretary of Natural Resources estimates that the clean up of all the impaired waters in the Commonwealth (not just the Bay) will cost the State around $2.4 BILLION.

    I don’t think that less than %1 of the budget is going to cut it any longer.

  12. Anonymous Avatar

    I’d like to go back to a line from the very first comment in this thread: “The only thing of substance here is the Bay funding.”

    I whole heartedly agree. In FY 04 Education received nearly 40%, or 9.4 BILLION of the Virginia’s entire budget and Transportation got another 13.5%, or 3.4 BILLION of the budget. I think most Virginians would be appalled to know that all Natural Resources programs received less than 1%, or 243 MILLION of the total budget. This less than 1% has to be divided amongst all natural resources programs. (Air, water, land conservaton, etc.)

    The Secretary of Natural Resources estimates that the clean up of all the impaired waters in the Commonwealth (not just the Bay) will cost the State around $2.4 BILLION.

    I don’t think that less than %1 of the budget is going to cut it any longer.

  13. Noah Webster Avatar
    Noah Webster

    I hate to criticze the Noble Barnie Day but he really missed one in his take on the “Republican Legislative Agenda.”

    I mean Medicaide Health Savings Accounts?? Medicaide–in Virginia– is limited to the very poorest. And the Republicans expect those people to be able to marshall assets enough to save for Medicaide? And wouldn’t that make them ineligible?

    Hmmmm…there’s more that goes ’round at night than Santa Claus–its Republicans’ reasoning

  14. Jim Bacon Avatar

    Noah, I’m not privy to the Republicans’ Medicaid Health Savings Account legislation, so I can’t comment on it specifically. But it sounds like you misunderstand how HSAs work. People enrolled in HSAs don’t contribute to them. Employers put money into the account (and usually buy a catastrophic insurance wrapper). If people need money to pay for medical services, they draw down the account. If they don’t spend all the money by the end of the year, it rolls over and accumulates. Sometimes, depending on the plan, they can cash out some of the money. The idea is that people will act as more astute consumers of health care services if they see the money as their own.

    Some HSAs are accompanied by disease management programs — high blood pressure, diabetes, asthma, etc. — and educational programs that try to persuade people to change their behavior. There are very few incentives in the current Medicaid program to get people to adopt more healthy lifestyles. If we want to help poor people become healthier and save tax dollars at the same time, we need to set up a system that puts some of the responsibility for their health on the patients themselves

  15. Anonymous Avatar

    What is most significant about the Athey list is that it is being pitched–not as the “Republican” legislative agenda, but as the “House Republican” agenda. Tells me the disconnect between Republican majorities in the House and Senate is as pronounced as ever, and though the “Advance” must have been a swell cocktail party, it accomplished…exactly…well… nothing.–Barnie Day

  16. Becky Dale Avatar
    Becky Dale

    The Supreme Court in Kelo looked at just one question: Was New London’s plan for disposition of the property a “public use” under the Takings Clause of the 5th Amendment. The court said yes, economic development is a public purpose. Connecticut had a law specifically authorizing the use of eminent domain for economic development and the court did not see that the state law conflicted with the 5th Amendment. But the court also said that states CAN limit their powers of eminent domain. The question now for Virginia is whether Virginia’s law is properly limited. Just because the Supreme Court okayed Connecticut’s law doesn’t mean it’s imposing it on everyone else.

  17. SouthoftheJames.com Avatar
    SouthoftheJames.com

    Just a thought: Does the lack of a clear agenda simply indicate the lack of good ideas, or could it be an indicator of the lack of dire social/economic problems for most Virginians?

    In the absence of a Democratic or other counterpart, it seems intuitive to me that maybe that – outside of health care and transportation – the incidence of true crises in terms of public policy front are limited. While we always have various issues to address, can we really point to major problems that exist on a statewide, societal level that the GA/state government even has the capacity to address?

    Or, do we have discrete issues that are geographic in nature and call for, say, more flexibility from the state to allow for local solutions. I’m leaning toward the latter, and to that end, there’s not a legislative agenda yet that’s been publicized to address it.

    The fact is, most of our schools are accredited, most of our metro areas are doing well economically, and the coffers are brimming with surplus cash (or the appearance thereof). Maybe it’s morning in Virginia, again?

    — Conaway

  18. Anonymous Avatar

    If anybody on this string cares about the truth, under Virginia law, a public service companiy may condemn property only for “its, lines, facilities, and works.” It cannot reconvey that property to another person. You can look it up yourself — in Va Code section 56-49, paragraph 2.

  19. Anonymous Avatar

    Wow. Lots of good commentary today, which I’m just now seeing. As I do expect many more ideas from the House Caucus, which had an agenda last year that ran to 3-4 pages I think. I’ve since heard that the way Medicaid Health Savings Accounts might work is to give the recipient a pot of money rather than a free pass to see lots of providers, and then provide incentives to manage the money carefully (including the big one, letting them keep all or part of what they don’t spend.) Certainly an idea worth fleshing out, but its bound to be controversial — SDH

  20. Jim, my friend, you’ve fallen victim to the easy rhetoric used by R’s to extoll the “benefits” of HSAs … that old something for nothing smokescreen.

    Here’s how the Dept of the US Treasury explains HSA’s in their tri-fold brochure:

    “A Health Savings Account (HSA) is an account that you can put money into to save for future medical expenses. There are certain advantages to putting money into these accounts, including favorable tax treatment.”

    ***
    “Any adult can contribute to an HSA if they:
    • Have coverage under an HSA-qualified “high deductible health plan” (HDHP)
    • Have no other first-dollar medical coverage (other types of insurance like specific injury insurance or accident, disability, dental care, vision care, or long-term care insurance are permitted).
    • Are not enrolled in Medicare.
    • Cannot be claimed as a dependent on someone else’s tax return.”

    “Contributions to your HSA can be made by you, your employer, or both. However, the total contributions are limited annually. If you make a contribution, you can deduct the contributions (even if you do not itemize deductions) when completing your federal income tax return.”

    Employer contributions to HSAs are completely voluntary. An employer can take the cost savings from implementing a high deductible health insurance plan ($1,000 minimum) and leave the employee to fund the deductible and the HSA all on his own.

    Most employers recognize that this will lead to more uninsured workers because more will opt out of the plan and many will go without preventive care (unless the plan exempts those costs from the deductible) so they agree to make some contribution for the employee. But there is no requirement that they do.

    How this HSA concept translates into the Medicaid population does challenge the imagination. Where does the cash come from to fund the Medicaid Savings Account? Will there be deductibles, too? And, what kind of waiver from the feds will be required to let Medicaid recipients accumulate funds in these accounts without becoming disqualified?

    Currently, people on Medicare are specifically precluded from having federal HSA’s. Wouldn’t the reasons for that suggest some reason why the HSA concept doesn’t fit the Medicaid recipient population?

    Even more interesting are the other proposals now under consideration to “reform” Medicaid:

    1) Giving Medicaid beneficiaries a benefit card with which to “pay” for services.
    2) Electronic medical records (hospital costs? privacy?)
    3) Program review of eligibility of those now receiving Medicaid with possible adverse consequences for MR/Autistic and other MH waiver recipients
    4) Asset transfer reform (query, will middle class Republicans be happy with changes that require them to pay down more family assets before qualifying for Medicaid?)
    5) Long term insurance tax credits (designed to use that complex tax code to encourage us to insure ourselves so we won’t need Medicaid)
    6) Insurance pools for small businesses(difficult to do right; see Council of Smaller Enterprises in Cleveland and the Connecticut Business and Industrial Association for examples of pools that “work”)
    7) Health courts with specially trained judges; we’re going to spend money on a special court system when it’s already clear that Virginia’s other reforms (like medmal caps) have not reduced insurance premiums?
    8) Consolidating Medicaid fraud activities of DMAS and OAG in the AG’s office; makes sense but “reform?”
    9) Review drug utilization in Medicaid program; some think that there’s abuse

    Nowhere in these proposals being kicked around by the Republican working group chaired by Phil Hamilton are those that might actually reduce health care costs by reducing the demand for services/drugs like a renewed emphasis on wellness and preventive care that will reduce the incidence of chronic diseases like diabetes that drive up costs or a reduction in preventable medical accidents and injuries (millions in avoidable costs each year).

    It’s difficult to find the path to progress through the political minefields, but real reform requires some big risk taking not seen on the menu the R’s are getting ready to publish. Without big risks there are no big successes.

  21. Jim Bacon Avatar

    No, Claire, I have not “fallen victim to the easy rhetoric of the Rs” regarding HSAs. As I clearly stated in my comments, I am not privy to the details of their proposal. However, I would gladly defend the concept of HSAs. I got most of my information from an interview with Doug Kronenberg, a senior executive with Alexandria-based Lumenos, and a national leaders in packaging HSAs. (See profile here.)

    In the Lumenos model, an “emphasis on wellness and preventive care” is central. I don’t know if the Rs think along the same lines as Doug Kronenberg or not, but if they were smart, they’d invite him to help craft their legislation. In any case, I would endorse a Lumenos-like HSA for Medicaid patients, as I hope you would.

  22. James Atticus Bowden Avatar
    James Atticus Bowden

    CG2: You point out some great details on HSAs are they are today. I just hope, surely to goodness, that the GOP legislators won’t be so limited in their thinking for HSAs for Virginia.

  23. Anonymous Avatar

    Maybe I’m confused, but I pay into something like an HSA and my employer doesn’t. This is in Virginia. Since my known health care costs are substantial, I can prepay them before taxes. This is a big help, even though the reporting is onerous.

    Even if my employer paid, he would consider it as part of his total costs of my employment, just as he does with “his half” of my social security, or with “his payments” for worker’s compensation.

    Thank you CG2 for elucidating.

  24. Jim:
    Here’s the part of your post that left me thinking that you had fallen prey to pretty pictures drawn of HSA’s that conflict with reality:

    “People enrolled in HSAs don’t contribute to them. Employers put money into the account (and usually buy a catastrophic insurance wrapper). If people need money to pay for medical services, they draw down the account.”

    The fact is that people enrolled in HSA’s do contribute and that employer contributions are entirely voluntary. The other fact is that people only get the “privilege” of contributing to HSA’s if their employer offers them a high deductible insurance policy ($1,000 minimum). The assumption is that they’ll pay the deductible from the HSA that they set up with their money (albeit tax advantaged).

    If the House GOPers are moving this concept into the Medicaid system, the first question is where will the money come from to fund the HSAs? Taxpayers? Beneficiaries earning minimum wage?

    Second, who will help Medicaid beneficiaries set up these accounts and learn how to use them? (Low utilization of the federal HSAs is attributed in part to the complexity of the rules both for employers and beneficiaries).

    Third, how will the Medicaid HSA’s be structured to assure (as you hope) that the result of this approach is not a disincentive for consumers to invest in preventive care (immunizations, routine check ups, colonoscopies, mammograms, etc)?

    Fourth, where in this plan is the mandate to providers to publish rate plans, mortality information, infection rates, and other information essential to any plan that gives medical consumers more responsibility for medical choices and spending? Delegate Purkey put in a bill last session, HB 1570, to require the Board of Health to aggregate data on hospital acquired infections and make it available to the public for the purpose of “determining any necessary actions to protect the interests of Virginia consumers.” By the time the bill got to the Governor for signature, the bill required reporting to the Board of Health which was authorized to release the data to the public “upon request,” and the effective data was delayed until July 1, 2008 (a soft way to kill a bill without taking a hit publicly for preventing its passage).

    There is general agreement among patient safety experts that the incidence of hospital acquired infections is a key indicator of a hospital’s commitment to patient safety generally.

    But, in Virginia, health care providers and their advocates continue to resist any public disclosure of patient safety data, hospital fee schedules and other consumer information.

    Can any Medicaid or other health care cost reform based on a philosophy of increased consumer responsibility be fairly or effectively implemented without such information?

    Would anyone expect consumers to make informed choices about any other product without safety and cost information?

    These are the questions that need answering in order to evaluate the GOP proposal to use HSA’s as a vehicle for Medicaid reform.

    CG2

  25. Jim Bacon Avatar

    Claire, all of your concerns and questions are good ones.

    It would be ludicrous for the General Assembly to create HSAs for Medicaid patients and expect the recipients to fund the plans out of their own pockets. If that’s what’s being proposed, legislators needn’t waste their time. I assume that the idea is for the state to fund individual accounts with money that it would have spent paying providers directly. Otherwise, the idea just doesn’t make sense.

    I agree, too, that a key part of the plan is to get people to (a) engage in healthier lifestyles and (b) to utilize the health care system more efficiently. That’s what makes the idea a win-win-win.

    Right now, Medicaid recipients have no financial incentive to do either (a) or (b). HSAs would give them that incentive.

    But, of course, the devil is in the details of the legislation.

  26. Anonymous Avatar

    Someone told me once that you should use the good times to tackle bad problems.

    With that in mind, it seems to me that now would be the ideal time to demand better coordination and collaboration between our institutes of higher education in this state by installing a chancellor driven system.

    Second, time to take a long hard look at what we do to support and enable small businesses to become big businesses in Virginia. VEDP does a great job bringing in outsiders, but what can we do to help our existing businesses grow in Virginia first?

    Third, I am in total agreement on natural resource conservation but it cannot, and must not, stop with the Chesapeake Bay. The Roanoke and Tennessee River Basins need help as well.

    Finally, can we please get serious about annexation and intergovernmental collaboration on the local level. It is time to revisit how our charter cities live and breath economically when their big earners live outside of their boundaries. Time to take a hard look at Dillon’s Rule and its application in local governance.

    That’s just a small list. I’m sure AG McDonnell will have us working on more important issues like Intelligent Design, Bolling will have us hard at work on Tax rebates to rich, white dudes, and Kaine will be busy introducing multiple resolutions calling for the immediate installation of a 40 foot high Mark Warner statue for placement in the Governor Mansion’s formal garden.

  27. James Atticus Bowden Avatar
    James Atticus Bowden

    CG2, more great details for consideration. Wall Street Journal has a good, positive editorial on HSAs today.

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