Monday, June 15, 2009

Obama's Speech to the AMA: Something for Everyone

TV Doctor Tim Johnson offers pointed point-by-point comments on the President's lengthy speech today to the American Medical Association. Johnson notes that the speech had lines that the docs loved, and some that they didn't.

It seems to us that Obama did what Obama does: suggest that he's on all sides of an issue at once. That's great for forging political support but not much guidance for policy.

Our primary concern in Obama's discussion remains the notion of a "public" (read: "government") plan that would inevitably drive out private insurance, leaving most citizens with no choice but to take what Uncle Sugar offers. We find it disingenuous to suggest that a government plan will force savings by reducing unfair profits from the insurance companies when encouraging more private competition and choice by reducing mandates and eliminating barriers between states would clearly offer the better way to force competition and reduce prices.

We're no less impressed that every nation, regardless of its system of financing health care, is experiencing rising costs. The problem is that no one wants to be sick or die. Everyone is willing to spend any amount to avoid that, especially if they spend someone else's money. So cost control will always be an issue, but one made better by assuring that the cost of healthcare is felt directly by the beneficiary.


Anonymous said...

Did you see the cost proposal the Dems put up for this? Oh well whats another trillion over ten years.


Jon A. Alfred E. Michael J. Wile E. SWNID said...

Yes, that estimate is what happens when the government controls costs.

Oddly enough, at present Medicare Part D, the much maligned prescription drug benefit, is costing about 60% of original estimates. That is probably the only instance ever of such a thing happening.

Micah said...

Medical insurance companies have, on average, profit rates of 3.5% or so.

That's hardly exorbitant.

Anonymous said...

Micah dude, all profits are exorbitant. What we need are companies that lose money, like Chrysler and GM. Power to the people!

Gonzo said...

I work in the healthcare industry and I can tell you that the figure that nobody is questioning (the 1 trillion over 10 years) is laughable.

We spend 2.2 trillion currently on insured healthcare (private, medicare, medicaid). That's on about 300 million people (maybe somewhat less). How are we going to insure (pay for) 47 million more people for 100 billion per year, with no inflation for the next 10 years?

We give the politicians and the media far too much leeway with outrageous forecasts that become outrageous assumptions.

It's going to cost 300 to 400 billion per year in current year dollars. Find the tax increase that's going to pay for that!

Christine said...


The taxes will obviously come from somebody else (Obama promised), so we don't care how much it costs.
The evil corporations will just have to pony up.

Gonzo said...

The politicians are beholden to corporate lobbyists (except in a few politically correct industries). HMOs fall in that politically incorrect category.

Employers who provide health insurance to employees do not. Hence the proposed tax on current employee health insurance went out the window before Ted Kennedy could take his next sip of bourbon.

There aren't enough rich people to pay the 300 to 400 billion per year (without grossly negatively hurting the economy, which only Democrats will pay for politically in the next 5 years). And the "rich" corporations have senators in their pockets.

This bill is floundering now not for lack of effective ideas (though it should be floundering because of this problem). It's floundering because nobody can figure out how to pay for it after just passing a nearly 1 trillion dollar "stimulus" that takes the 2009 single year deficit to nearly 2 trillion.

Currently Congress is looking for only $600 to $700 billion (of the 1 trillion forecasted / assumed cost) of the new health plan, promising the rest will come from "cost savings." Those are the same cost savings Medicare / Medicaid has been unable to wring out through countless reforms in the last 20 years.

But even at $600 billion to $700 billion, Democrats are lost because they can't find the revenue in a politically favorable way. The revenue just doesn't exist politically (they will pay a heavy political price for the revenue they do try to raise).

Plus I think they know that the promises and cost estimates are so far off that the whole country will know what a disaster the new entitlement is prior to November 2012 (could cost Obama the election). And the politically unbearable costs will be evident to all in November 2010 (could cost congressional Democrats reelection). Democrats are in a no win situation of their own making. They have dug themselves a hole.

Gonzo said...

That should be "politically incorrect" in both sentences in the first paragraph.