“Well, if they’re 45 years old, and they show up, and say, I want insurance because I’ve got a heart disease, it’s like, `Hey guys, we can’t play the game like that,'” Romney told Leno. “You’ve got to get insurance when you’re well, and if you get ill, then you’re going to be covered.”
So, if you’re 45, lost your insurance because you lost your job, your COBRA benefits expired and you can’t get insurance in the individual market because you have heart disease and can’t afford the coverage (if you are even lucky enough to live in a state where an insurer offers it) you’re, well, screwed.
Good to know he’s got that all figured out.

Rep. Paul Ryan (R WI) and the House Republicans are touting their budget as fiscally responsible and prudent. What Mr Ryan conveniently forgets, or more likely avoids, is this:
Eight short years ago he – and his GOP buddies – passed the single largest entitlement program since Medicare – the Medicare Part D drug benefit – with no dedicated financing, no offsets and no revenue-generators – the entire future cost – which is now around sixteen trillion dollars [see page 148] – simply added to the federal budget deficit.
According to Bruce Bartlett writing in the Fiscal Times, “By 2030, Part D alone will cost taxpayers 1 percent of GDP.”
There’s a legitimate argument that health reform is going to add additional cost, and will require additional revenue. Let’s accept the GOP’s claim that health reform will add $700 billion to the deficit. That’s one-twentieth of the deficit from Part D.
That’s right – Paul Ryan’s Part D added twenty times more to the Federal deficit than even he claims reform will. Yet the GOP budget he wrote doesn’t include any provisions to end, or fix, or reduce Part D.
Notably, the President’s budget proposal doesn’t address long term costs of Part D either – and yes, that’s a serious problem.
Folks, we have a BIG deficit problem. If we aren’t deadly serious about what we need to do, we’re screwed. Whether you’re a conservative or liberal, Glenn Beck-er or Rachel Maddow fan, red stater or blue stater, there are basic, immutable facts.
Part D’s $16,000,000,000,000.00 ultimate cost is one of the more obvious.
It would have been more than refreshing if Ryan and the Republicans’ budget was more financially responsible, more old-style fiscally-conservative-Republican. That would have been courageous – admitting he and his party made a mistake. Sure, they would’ve taken a hit from older Americans who love Part D, but true statesmen, real leaders know that tough, unpopular stands are necessary some times
Ryan’s blatant hypocrisy reveals that he – and his party – don’t care one whit about the deficit or budgets or fiscal responsibility. Nope, they just want to get re-elected.
What should we do?
Either a) end Part D or b) allow the Feds to use their buying power to negotiate with pharma. That alone would save about $20 billion a year.
Canceling Part D won’t happen; neither party is about to tell seniors they can’t have free medicine. If Ryan et al were really concerned about the deficit, they’d consider using the government’s buying power to reduce costs and thus lower the deficit. But of course they won’t; that would alienate big pharma and cut into their campaign contributions.

The list of those opposing health reform includes Tea Partiers, libertarians and other small government advocates; the Chamber of Commerce, Association of Manufacturers, and National Federation of Independent Businesses; health plans (some of them), brokers, and insurers.
For some the issue is personal “liberty”, decrying governmental intrusion into what they believe should be an entirely “free” market.
Others are more specific, outraged that they are forced to buy a service from a private insurer.
But for some, primarily the larger DC-based organizations and their dues-paying members, the issue appears to be more broad, a general perception that reform is yet another indicator of increased governmental intrusion into ‘their’ business. Private companies want to be left alone, to run their businesses and do their stuff without what they view as often unnecessary and ill-advised interference from bureaucrats. The faith in the free market, the belief in unfettered competition’s ability to deliver the best result for the most is the underlying driver, driving many big companies – who would benefit from the mandate and most other provisions of the PPACA, to work diligently to overturn health reform.
Understand that those of us with insurance (including big corporations, small employers who provide health insurance, and governmental entities (and therefore taxpayers)) are subsidizing the health care needs of those without. The 49 million Americans without health insurance get health care, they just don’t pay for it; those of us with insurance do through the miracle of cost-shifting.
The willingness of reform’s opponents to sacrifice their corporate profits on the altar of the free market is admirable, as is the enthusiasm of libertarians and true followers of the Tea Party ideology.
But I wonder how ideologically pure they’ll be if reform is overturned.
As evidence of the potential consequence of failing to think thru the long-term and unintended consequences of ideological purity, I give you the Export-Import Bank, an agency of the federal government.
Stick with me here; the Ex-Im Bank provides credit to American companies selling goods and services abroad. For many companies, it is the ONLY source of credit financing their overseas business. As a result, the Ex-Im Bank helps drive exports, which creates and maintains employment, improves our balance of payments, and builds American companies.
But – the Ex-Im Bank is in deep trouble; the House has rejected further funding for the bank [opens video] (which is very profitable, generating over $5 billion in profits) thus the Bank will have to shut down in two months. If it does, businesses from tiny crop dusting aircraft manufacturers to Boeing, chemicals to finished products will find markets dry up, sales fall off, and profits plummet. We can expect layoffs at the Boeing plant in South Carolina, the duPont plants in North Carolina, Air Tractor in Texas, and Keller in Wilmington.
If that’s the necessary consequence of a return to an unfettered free market with less government intrusion, than so be it.
But that’s not what many backers of the GOP want. In fact, a long list of ardent supporters of the GOP, those who helped funded the historic gains won by Republicans in the 2010 midterm elections, are pretty unhappy with the men and women they elected. These new legislators, and ones who’ve been around for years, are the ones who are denying funding for the Ex-Im Bank, and thereby hurting the very folks who funded their successful campaigns. GOP Sens. Saxby Chambliss of Georgia, Charles Grassley of Iowa, Tom Coburn of Oklahoma Rand Paul of Kentucky Jim DeMint of South Carolina and Mike Lee of Utah are all opposing re-authorization of the Ex-Im Bank.
What some – Heritage and the Club for Growth – decry as corporate welfare and unfair competition, others of a very similar political stripe champion as critical to American business.
The same will happen with health reform.
If the Supremes overturn health reform and/or the individual mandate, employers, taxpayers, and individuals are going to see higher health insurance premiums. The entire market will be in a death spiral. As more opt out of coverage, the cost for the shrinking number of insureds will increase. Members of the Chamber of Commerce, the NFIB, and the Club for Growth will find their profits eaten up by health insurance premiums, or they’ll be forced to drop coverage entirely.
Individuals outraged by the mandate will be free to find coverage on their own, coverage which will be unaffordable for all but the richest Americans without any pre-existing medical conditions. New Jersey, a state with no mandate and restrictions on medical underwriting, provides insight into what individual insurance costs would be if the Court overturns the mandate (thanks to Bob Laszewski for the research)

a two adult plan with a $2,500 deductible and 80% coinsurance for example, there are only three carriers offering it. Aetna at $4,913 per month, Celtic at $12,322 a month, and Horizon at $6,127.78 per month. [emphasis added] These rates do not vary by age.

Yep, annual insurance premiums for two adults would cost between $60,000 and $148,000.
Hopefully they’ll be okay with that, secure in the knowledge that they’ve sacrificed good health and medical treatment, for themselves and their families, on the altar of liberty.
And no, the free market will not come up with a solution. If it could have, it would have by now.
Perhaps the fate of the Ex-Im Bank will encourage the ideologically pure to reconsider their objection to health reform, but probably not.

Monday I opined that the individual mandate will not be overturned. But let’s say it is – and stipulate that the rest of the health reform bill is rejected as well.
Then what?
We’ll leave aside the political implications for the moment, but it’s safe to say that a rejection of the PPACA by the Supreme Court would be bad news indeed for Democrats
Over the near term, what happens to the 49 million Americans currently without coverage? They won’t be able to get coverage under Medicaid.
Their employers – mostly small businesses – who can’t afford the premiums (without subsidies) today certainly won’t be able to find affordable insurance in the future.
In many states, people and families trying to buy coverage on the individual market will find a) their pre-existing conditions won’t be covered, or b) will only be covered after an extended waiting period and with a much higher premium and c) the cost of family coverage – for plans with very high deductibles – will be above $1500 a month in many states.
If health reform is overturned, 20% of Americans may be without coverage in 2020, yet we’ll be spending 20% of our GDP on health care. As more go without insurance, cost-shifting to those with coverage will increase, driving up their premiums even faster. The vicious cycle will accelerate, and as costs rise, employers and families will drop coverage, dumping more cost onto the ever-smaller population of insureds.
Okay, back to the political implications.
As David Blumenthal noted in the NEJM article cited above, if the Republicans win big this fall, after blasting health reform for the last several years a GOP administration and Congress would find it difficult to then legislate a new approach.
Moreover; ” the traditional Republican approach to covering uninsured Americans [is] an individual tax credit subsidizing purchases of private health insurance funded by ending the tax exemption for employers’ contributions to employees’ health insurance. Many employers and employees oppose this idea, and it would be difficult to pass without a major political fight. Historically, Republican presidents have been reluctant to take on the political costs of comprehensive health care reform, and the last thing a new Republican president will want is to fall on the political sword that impaled his predecessor.”
So.
PPACA is overturned, the number of uninsured is on a path to 20% of the population, the insurance death spiral accelerates, and the new Congress and President can’t/won’t do anything about it.
Can someone tell me how the free market fixes this problem? What insurance company is going to seek to cover families and small businesses with significant pre-existing conditions? Which, by the way, more and more of us have?
And if you can’t get coverage thru your small employer or on the open market, what are you going to do?
Those folks lucky enough to live in states with rational, sentient state legislatures will be better off than those living in states less fortunate.
But all of us will be facing family premiums north of $30,000 within five years.

There’s too much legal precedence at stake, too many years of “settled” law, too much potential disruption to the legal system for the Supreme Court to reject the individual mandate portion of the PPACA.
That’s the general consensus of legal experts, and while they could be wrong, I don’t think so.
A quick summary.
There are four separate issues in front of the Supreme Court, with perhaps the most significant the “individual mandate”: the requirement that each of us have health insurance or pay a (rather modest) fine. According to an American Bar Association poll of experts on the Supreme Court; “85% said the act would be upheld, [emphasis added] mainly because they believed the court would find the requirement that all adult Americans obtain insurance coverage to be constitutional.”
Before my conservative friends start railing, don’t assault the messenger. This isn’t a political statement, but rather reporting on what looks to be a general consensus that the mandate will be upheld. [opens pdf]
Moreover, let’s not forget that the insurance mandate was the brainchild of the conservative Heritage Foundation; back in 1989 the Foundation’s Stuart Butler wrote:
“[N]either the federal government nor any state requires all households to protect themselves from the potentially catastrophic costs of a serious accident or illness. Under the Heritage plan, there would be such a requirement…Society does feel a moral obligation to insure that its citizens do not suffer from the unavailability of health care. But on the other hand, each household has the obligation, to the extent it is able, to avoid placing demands on society by protecting itself…A mandate on households certainly would force those with adequate means to obtain insurance protection.”
The same expert panel surveyed by the ABA also predicted the Court will:
– not find the challenge to the law is premature (in legal-speak, the issue isn’t “ripe”)
– they will uphold the rest of the law if the mandate is ruled un-Constitutional
– the Medicaid expansion will be deemed Constitutional (24 states have asserted it is not)
As regular readers know all too well, my batting average on these prediction things can be pretty inconsistent, so opponents of the PPACA may well take heart; if I’m betting one way, there’s almost certainly a lot of smart money taking the other side of the wager.
Either way, we’ll have a ruling in early summer. In the interim, health plans are betting the law will be upheld, and are working fast and furiously to prepare.

There’s a budget proposal from the President, one from Rep Paul Ryan (R WI) and the House of Representatives, a third from the House Progressive Caucus, and several permutations from the four GOP Presidential nomination contenders as well.
But where’s yours?
Haven’t gotten around to it? That’s no excuse – especially now that you can build your own version of the Federal budget here.. Takes just a couple minutes, and you’ll actually know a lot more about where dollars go, and where they come from when you’re done.
Want to keep those taxes low and slash entitlements? Get to it! Time to increase spending on science? You go, girl/boy! Angry that there’s not enough for NASA? Raise their budget to the moon! Want more dollars for border security? You’re the boss!
Best of all, you don’t even have to deal with lobbyists, the media, bloggers (aren’t they the worst?!), arguments among your own advisers, nasty comments from the opposition, or SuperPACs using your own words against you…
Seriously, a pretty enlightening experience for all.

There’s a seemingly intractable conflict facing the Obama Administration – how can they argue – simultaneously – that the mandate is crucial to the Affordable Care Act, while also arguing that the rest of the Act should and can survive if the Supreme Court rules the mandate is unconstitutional?
That’s the Hobson’s choice facing lawyers arguing for the Administration, and while the two positions seem irreconcilable, they may not be.
Merrill Goozner is convinced the two positions can comprise a reasonable and legally logical argument. He cites a recent article in the NEJM, to wit:
“Legally, however, the positions are consistent: the mandate may be an important part of the statutory scheme, and thus constitutional, but not absolutely vital, and hence completely severable.”
Of course, if the mandate is struck down but the rest of the law stands, the insurance industry will scream bloody murder, as they should. Other provisions of ACA prohibit insurers from medically underwriting health insurance, require standard benefit plans, and force insurers to sell coverage to anyone who can afford it.
Therein lies the rub. As Merrill points out, insurers will have to increase rates to pay for free riders who opt into coverage when they need care only to drop it when they’re all better. Then again, that’s not much different from today; there are millions of free riders that get care essentially paid for by taxpayers and others who have health insurance.

Over at Mark Wall’s Linked-In Group there’s a passionate discussion going on about the impact of health reform on workers comp.
I have my own views on the impact of reform on workers comp, namely the Affordable Care Act, aka PPACA, aka Obamacare, is generally good news for the comp industry. That may not sit well with the ideologically pure, but here’s why.
– Healthier claimants – those with insurance are healthier than those without
– no need for WC to pay for non-occ conditions once the claimant has coverage (whether the WC payer follows thru on this is a separate issue)
– more science and less art in the practice of medicine as comparative effectiveness research gains traction – good news indeed for comp payers saddled with back surgeries and H-Wave devices.
– of course, there’s bad news – mostly for comp networks who are going to become increasingly ineffective in their efforts to negotiate favorable deals with big provider groups, facilities, and systems.
But, as Mark and others point out, while we think we know what’s going to happen, we really can’t know…

My post yesterday about the impact of health reform on employment generated an email from NFIB’s Bob Graboyes correcting an error in attribution (thanks Bob). It also got me to dig deeper into the issue of employment and reform – specifically, what’s the net effect – what jobs and how many will be lost to to PPACA, and what jobs and how many will be gained as a result of health reform.
Let’s leave aside the fact that with reform it will be a lot easier for workers to move from a big company and their health plan to individually-insured plan, enabling more would-be entrepreneurs to start their own firms.
According to Monster, there will be a plethora of new jobs for technicians, clinicians, and support workers.
And NFIB’s own analysis estimates the employer mandate [opens pdf, see p 20] – the old one, not the one that exempted employers with fewer than 50 workers – would have created 890,000 jobs. (NFIB hasn’t updated their numbers to reflect the lack of mandate for small employers.)
That said, NFIB indicated the mandate would create a lot of jobs – and good paying ones at that:
“The employer mandate would boost demand for healthcare goods and services, thereby increasing employment in healthcare-related sectors. The number of ambulatory healthcare professionals (physicians, dentists, and other healthcare practitioners) needed will increase by 330,000. An additional 327,000 staff will be required to work in hospitals. Some 157,000 more nurses (net of retirements) will be needed to staff doctors’ offices, outpatient clinics, and other provider locations. And payrolls at insurance companies will expand by 76,000 workers.”
Okay, so we have 330,000 more jobs for docs and dentists, and 157,000 net new openings for nurses. That’s almost half a million new high-paying jobs; these aren’t retail clerks, burger flippers or car wash attendees, these are folks making from $50,000 to $400,000.
True, some jobs will be lost, but we don’t know if there will be a net loss or gain. But lets say there’s a net loss. According to NFIB, the vast majority of the jobs we’ll lose are in retail and food service.
Marketwatch notes that the Sunshine State may well see more jobs added as a result of reform. The article goes on to note some experts’ opinions that while there will be more jobs open, many will go unfilled due to a lack of trained clinicians.
One hopes that the invisible hand will remedy this situation.
Of course, we’d be much better off if we could look into the future. Fortunately, we can. Recall Massachusetts enacted legislation very similar to PPACA back in 2009.
Overall, employment gains in healthcare Massachusetts have outstripped the rest of the country by four points; Mass added 9.5% more health care jobs since passage of reform while the rest of the nation averaged 5.5%.
But the impact wasn’t just on health care job counts. While the rest of the country saw a 2.9% drop in employment since Massachusetts passed reform, Mass’ employment dropped by a mere 0.2%.
What does this mean?
Well, there will likely be fewer overall jobs, but there will be a lot of new, high-paying jobs that may balance out the loss of what look to be lower paying jobs.