The GOP plan to cut spending by $5 trillion in 10 years includes cutting Medicare and making the Bush tax cuts permanent. Image: CC Ed Yourdon/Flickr

Rep Paul Ryan, R-Wis., has presented a budget proposal with severe long-term spending cuts that includes Medicare reform. Ryan’s plan would replace traditional Medicare with subsidies for seniors to buy private insurance. Republicans have tried to use the federal deficit to dismantle Medicare before but failed when opponents made clear that their purpose for defunding Medicare is to finance tax cuts for the rich.

GOP turns about face on Medicare reform

Republicans fought health care reform in 2010 by threatening seniors with dire warnings about slashed Medicare benefits. In 2011, a GOP budget proposal called “Path to Prosperity” purports to slash government spending by $5 trillion over the next decade. Ryan wants to dismantle Medicare, a $520 billion program that provides medical coverage to approximately 47 million older and disabled Americans. The GOP plan for Medicare reform calls for repealing the health care reform law that extends insurance coverage to 30 million Americans. For Americans currently 54 and younger, instead of Medicare they would get a federal payment to buy private insurance from a choice of government-regulated plans. It strips the poor and disabled from a right to health care under current federal law by converting Medicaid to a block grant for each state to design its own insurance plans. Retirees in the future would wait until age 67 to be eligible for Medicare.

GOP budget plan targets poor, disabled and retirees

If the health care law is repealed under the Republican plan for Medicare reform, some people without employer insurance may not be able to afford medical coverage or get insurance at any price if they have pre-existing conditions. States, which have gone broke during the economic downturn, will have their ability to offer vulnerable low-income people  protection further eroded. Analysis by the nonpartisan Congressional Budget Office said in the future retirees would pay more because benefits would be more expensive to deliver through private insurers. By 2030, the government payment used to buy health insurance would only cover about one-third of a person’s total health care costs.

Ryan downplays tax cuts for the rich

Dismantling the U.S. health care safety net has been a Republican goal for about 50 years. Ryan’s “Path to Prosperity” is an attempt to use deficit reduction as a means to achieve it. In addition to cutting spending, “Path to Prosperity” is a plan for more tax cuts. Cutting Medicare is part of Ryan’s strategy to offset lower corporate taxes and bring down the top individual tax bracket from 35 to 25 percent, essentially making the Bush tax cuts permanent. In a slick video presenting his budget proposal, Ryan doesn’t mention the tax cuts, but he says cutting Medicare is the only way to save it. It’s a familiar Republican strategy. In 1995 Republicans warned that the deficit was a threat to the survival of the nation. They proposed saving Medicare by privatizing it. President Clinton made clear to the public that the GOP plan cut Medicare in order to finance a regressive tax cut. Clinton prevailed 16 years ago because Medicare was more popular than tax cuts for the rich.

Sources

Washington Post

The New Republic

MSN Money

Salon

Customers in California with Blue Shield insurance are facing almost 60 percent rate hikes. Image: Flickr / houseofsims / CC-BY

Blue Shield of California insures several hundred thousand customers. In October, the insurer announced three gradual rate increases that add up to 59 percent. The state is investigating the increases, but an outside auditor is calling the increases “reasonable.”

Stepped rate increases in California

Blue Shield of California, in October 2010, announced they would be increasing insurance rates. The claim of the insurer is that these increases are in response to the rising cost of health care. The insurer also says that more people are dropping health insurance, so prices need to be increased. The first of the three increases hit on Oct. 1, with additional increases on Jan. 1 and March 1. For more than 100,000 customers, these three increases added up to a 59 percent increase in premiums.

Rate increases called ‘reasonable’

After the State of California and ratepayers raised serious concerns about the rate increases, Blue Shield of California hired an auditor. The auditor recently released his report to both the state auditors and the general public. The audit calls the 59 percent rate increases “reasonable” in the face of the increasing cost of health care, especially in California. The auditor indicates that the health insurer should be able to meet the requirement that 80 percent of premiums be spent on customers’ health care. The state auditors have raised concerns that this audit does not include all the information they had requested from the company.

State regulators have no recourse

Though the State of California does review and approve insurance rate changes, the regulators do not actually have any legal recourse. Even if the state does not approve of the insurance rate hikes, the hikes can still stick. The legislature is considering passing emergency legislation that would allow them to block the rate hikes, but the political will is likely not there. Some customers are blaming the new health insurance bill for these rate increases. The reality is, however, that Blue Shield of California is claiming that customers leaving the system — which will likely not happen once health insurance reforms are fully in effect — is the cause of the increasing costs.

Source

LA Times

The 1099 rule was viewed by both parties as a burden to small business, but they remain bitterly opposed on health care reform. Image: CC laura padgett/Flickr

The 1099 repeal amendment that was approved by the Senate Wednesday was a no-brainer. Repeal of the 1099 rule, an onerous administrative burden for small businesses, was the single aspect of health care reform upon which both sides of the aisle agreed. But a bill to repeal heath care reform pushed by Republicans failed in a Senate vote as expected.

Bipartisan unity on 1099 repeal

The 1099 repeal amendment to the health care law passed by an 81-17 vote in the Senate. The 1099 rule was inserted into health care reform to help finance the law by reducing tax evasion. The provision requires businesses to file 1099 forms for any business-to-business expense of more than $600 starting in 2012. Current rules require 1099 forms only for payments over $600 to independent contractors. The 1099 rule was projected to raise $19 billion to help pay for health care reform. The 1099 repeal amendment makes up for that loss by requiring lawmakers to find spending cuts.

Partisan divide on health care repeal

The 1099 repeal was proposed by Democratic senators. The repeal of health care reform was proposed by Republican senators. Both provisions were designed as amendments to a Federal Aviation Administration funding bill. The association with funding required 60 votes for the provisions to be allowed as amendments to the FAA bill. All 47 Republicans voted for the measure. All 50 Democrats present and one independent that caucuses with Democrats voted against it. Senate Republicans can be expected to persist in introducing health care repeal amendments to many bills. Before Wednesday’s Senate vote, two other Republicans introduced an amendment that would allow states to opt out of provisions of the health care law.

Crises push GOP message to the margins

Republicans forced a Senate vote to repeal health care reform shortly after a similar measure passed the Republican-controlled House. Using catch phrases such as “job-killing” and “government-run health care,” Republicans had hoped such grandstanding would embarrass the Obama administration and portray health care reform in a negative light. Unfortunately, the political theater of the House vote to repeal health care reform was overshadowed by the Arizona shooting. Several weeks later, unrest in Egypt diverted attention from the Senate vote. Both crises have given Barack Obama the opportunity to appear presidential and pushed the Republican message to the margins

Sources

Portfolio.com

Wall Street Journal

New York Times

A Republican majority passed a bill to repeal health care reform, which is expected to be dead on arrival in the Senate. Image: CC riptheskull/Flickr

A vote to repeal health care reform was staged by House Republicans Wednesday night. As expected, health care repeal passed with the Republican majority. The Democratic leadership in the Senate does not plan to address the issue, but Senate Republicans say they will try to force a vote to repeal health care reform.

The House vote to repeal health care reform

The vote to repeal health care reform was passed by all 242 House Republicans. Two Democratic representatives also voted for the bill, officially called “Repealing the Job-Killing Health Care Law Act.” Rep. Gabrielle Giffords of Arizona was the only Democrat who didn’t vote because she is currently receiving intense health care herself after being shot in the head during a public appearance Jan. 8. Voting on the bill, which is generally expected to be dead on arrival in the Senate, fulfills a promise Republicans made to get re-elected under Tea Party pressure.

House Republicans bet on Senate

House Republicans call their vote to repeal health care reform the first step in the ultimate dismantlement of the Obama administration’s signature achievement thus far. Senate majority leader Harry Reid, D-Nev., has refused to allow a vote to repeal health care reform on the schedule. House Republicans, emboldened by their new-found majority after the 2010 election, ratcheted up their rhetorical pressure on Senate Democrats after the vote. Rep. Steve King, R-Iowa, who authored the “Repealing the Job-Killing Health Care Law Act” right after health care reform became law, likes his bill’s chances. But he may have revealed his naivete about the Senate when he said. “It’s not a place for bills to go and end.”

Health care repeal’s uphill battle

A bill to repeal health care reform won’t make it past President Obama’s desk. However, Senate Minority Leader Mitch McConnell, R-Ky, says he will force Reid to consider it. Senate Republicans will probably take the path of least resistance: attaching repeal of health care reform as an amendment to another bill that needs to be passed, such as funding for an essential program. Reid would block such an amendment, but Republicans would counter by forcing a vote to suspend Senate rules. The GOP needs 67 votes for that to happen, which is unlikely for a bill that has no chance of getting 60 votes by any other route.

Sources

ABC News

NPR

The Atlantic

House Republicans with a new majority want to launch the 112th Congress with a symbolic vote to repeal health care reform. Image: Wikimedia Commons

Newly elected Republicans in the House are eager to repeal health care reform. House Republican leaders said they will force a vote to repeal health care reform before President Obama gives his State of the Union address Feb. 2. The GOP House vote to repeal health care reform is political theater that will do nothing by itself to change the law.

GOP wants to send Obama a message

House Republicans want to vote on a repeal of health care reform as one of their first orders of business in the 112th Congress. Although they have no viable alternative to the Patient Protection and Affordable Care Act, GOP leaders want to send President Obama a message about their newly won control of the House of Representatives. Republicans are confident they have enough votes to repeal health care reform in the House, but Democrats still control the Senate, and the president ultimately wields the veto pen. Meanwhile, the administration is rushing to implement the health care reform law as quickly as possible.

Politicians versus the public on health care reform

Voting to repeal health care reform outright throws red meat to the right wing Republican base. However, polls have shown that parts of health care reform are popular among most Americans. For example, as of Jan. 1, Medicare recipients became eligible for free preventive care, and seniors now receive government assistance to close the “doughnut hole” in Medicare prescription coverage. Insurance companies can no longer deny coverage for patients with pre-existing conditions. The White House is counting on health care reform to become more popular as more people realize the benefits.

A petty squabble to get even

By focusing on a repeal of health care reform out of the gate, some analysts think Republicans may be setting their own political trap. During the debate on health care reform, Republicans ridiculed Democrats for not focusing on jobs and the economy. The White House has said jobs and the economy will be its number one priority going forward. A petty squabble to get even for what has been called President Obama’s greatest achievement may not go over well with voters in 2012.

Sources

ABC News

Christian Science Monitor

CNN

A Medicare rule paying doctors to give advice on end-of-life care has conservatives shouting about death panels once again. Image: CC Andrew Aliferis/Flickr

“Death panels” was the cry right wing protesters used in an attempt to shout down health care reform. The phrase “death panels” refers to a proposal for funding end-of-life counseling. Advice for end-of-life care was dropped from the health care bill, but the Obama administration included it in new Medicare regulations  announced Monday.

Advice for end-of-life care covered by Medicare

Republicans and Tea Party activists played the death panels card when legislation was proposed allowing Medicare to pay for “advance care planning.” Opponents of health care reform spread the lie that Democrats wanted the government to decide who would qualify for medical care as they neared the end of their lives. Advance care planning didn’t make it into the Affordable Care Act, but it will be part of new Medicare rules in effect Jan. 1. The new policy will pay doctors to advise patients about their options for end-of-life care during an “annual wellness visit” that is part of the health care law. Those options include how to prepare a written “advance directive” about how patients want to be treated if they can’t decide for themselves.

Death panel myths versus reality

Conservatives are saying that the new Medicare rule will force patients to relinquish their ability to control end-of-life care. According to them, advice on end-of-life care is an effort to cut health care costs that will inevitably lead to death panels. The idea of a written advance directive resulting from a conference with a physician reimbursed by Medicare promotes a government agenda for health care rationing. The new Medicare provision does the exact opposite. It gives patients more control. Plus, physicians have always been opposed to government rules limiting health care.

What’s all the fuss about?

Amid all the death panels shouting, the Obama administration says the new Medicare rule for advance care planning is nothing new. An administration spokesman said the regulation continues policies enacted under George W. Bush. In 2003 Medicare started paying for a consultation visit to seniors starting out on Medicare. In 2008, a law was enacted allowing end-of-life planning as part of that consultation. The new Medicare rule simply states that advance care planning is allowed in the government funded annual wellness visit specified in the health care overhaul.

Sources

Forbes

New York Times

The Hill

Virginia District Court judge Henry Hudson has ruled the health care law unconstitutional. Image from Wikimedia Commons.

A federal judge in Virginia has ruled the health care reform laws unconstitutional. District Judge Henry Hudson ruled that Congress had overstepped its constitutional boundaries, but did not block the law from being enacted. The law wasn’t enjoined as Hudson anticipates appeals up to and including the Supreme Court.

Health care law slapped down in court

A judge of the U.S. District Court in Virginia has ruled the health care law unconstitutional. Several months ago, it was announced that a few state Attorneys General were suing the federal government on the grounds that the health care reform laws weren’t constitutionally valid. Judge Henry Hudson held that the laws, dubbed “Obama Care” though the president didn’t author the laws, were not within constitutional boundaries, according to the New York Times. Judge Hudson found that one of the central tenets of the law, the mandate that most Americans purchase health insurance by 2014, was unconstitutional. However, Hudson did not enjoin the law from being enacted.

Appeal expected

Judge Hudson declined to enjoin the law from being enacted in whole or in part for two reasons. First, the portion of the law that he ruled on doesn’t take effect until 2014. Secondly, Hudson is anticipating an appeal to a higher court. Should the ruling be appealed, and it appears likely it will be, it will first go to the Court of Appeals, though this is likely an issue that will go to the Supreme Court. In his ruling, Hudson offered that since it is likely a “higher court,” will ultimately decide the matter, he wouldn’t issue any injunctions. A deadline of 2014 gives the appeals process enough time to work.

Other suits pending

There were 25 suits filed by state Attorneys General across the nation, according to the Washington Post. Hudson is the third judge to rule on the matter. The other two decisions, in Michigan and another in Virginia, both found in favor of the government. Another suit against the health care reform law is under way in Florida.

Sources

New York Times

Washington Post

Health and Human Services director Kathleen Sebelius announced new rules establishing the minimum amount of premium revenues insurers must spend on patient care. Image: CC US Mission Geneva/Flickr

New regulations on the minimum amount of money from premiums health insurance companies must spend on patient care were released Monday. The spending minimum is known as the medical loss ratio requirement of health care reform, which intends to force insurance companies to reign in rising administrative costs being passed on to consumers. Insurance companies that don’t meet medical loss ratios must pay rebates to their customers.

Premiums must be spent on patient care

Minimum medical loss ratios issued by the Obama administration require large, in-group health insurance plans to spend at least 85 percent of money collected from premiums on patient care that includes doctor and hospital visits. Individual and small-group plans must spend 80 percent. Starting in January 2011, only 15-20 percent of insurance company spending can go toward salaries, bonuses and marketing. Health care reform requires insurance companies to report spending  publicly. Before health care reform, insurance companies were typically focused on limiting spending on medical costs as much as possible to please investors. At the announcement of the regulations, Health and Human Services Secretary Kathleen Sebelius said the rules “are an important step to hold insurance companies accountable.”

Lobbyists try to define medical expenses

The new rules on medical loss ratios were formulated using recommendations from the National Association of Insurance Commissioners (NAIC). The insurance industry’s trade organization, America’s Health Insurance Plans, lobbied for the broadest  definition of medical spending, including the cost of paying claims, signing up doctors and running call centers. Insurance industry lobbyists succeeded in getting such items as spending to reduce medical errors and investing in medical record technology classified as medical expenses. One coveted item they could not get classified as a medical expense  was payments to brokers and insurance agents.

Medical loss ratio rebates

Once the medical loss ratio rules go into effect, if insurance companies don’t spend the required percentage on medical care they must issue a rebate either to the policyholder or their employer. The Department of Health and Human Services estimates that 45 percent of people who buy their own coverage are in plans that currently don’t meet the 80 percent standard.  According to HHS, about 9 million people could be eligible for rebates–an average of $164 per person that could cost the insurance industry $1.4 billion in 2012.

Sources

MedPage Today

NPR

Wall Street Journal

Provisions of health care reform designed to curb abuses by health insurance companies kicked in Sept. 23 for new plans. Image: CC clevercupcakes/Flickr

The new health care law passed six months ago. On Sept. 23, several changes in the U.S. health care system start going into effect. Many of the more controversial parts of health care reform don’t start for a few more years. But key reforms such as coverage despite pre-existing conditions begin Thursday. Republicans are increasing their anti-health care reform rhetoric. President Obama has responded with his own vigorous defense of the new health care law. Though a majority of Americans were in favor of the law upon its passage, a majority now disapprove as it kicks in.

Health care reform for majority delayed until 2011

Health care reform actually won’t go into effect for most Americans until next year. The Wall Street Journal reports that the changes kick in immediately for new health plans started on or after Sept. 23. Employed people who get health insurance as a job benefit won’t see any changes until their plans renew during open enrollment — usually Jan. 1. The changes valid Sept. 23 were designed as a bridge until 2014, when subsidies for health plans will be available for people who can’t afford them. At that time, most Americans will be required to have health insurance or else be fined.

Health insurance changes going into effect

Key changes that go into affect for new health plans started after Sept. 23 included the following, courtesy of CNN:

Children under age 19 can no longer be denied coverage for pre-existing conditions. The same goes for adults in 2014.

Insurance companies can no longer drop a customer when they get sick or look for mistakes on their application for the purpose to deny payment when they get sick.

Preventive care such as physicals, mammograms and colonoscopies no longer require a co-payment or deductible.

Insurance companies can no longer impose lifetime dollar limits on essential benefits, such as lifesaving treatments.

Patients no longer need to get prior authorization from their insurance company or a doctor’s referral to see a pediatrician or OB/GYN.

Insurance companies must discontinue prior authorization for ER services. Plus, they can’t charge higher co-payments for out-of-network ER providers.

Insurance companies can’t refuse a claim in appeal, and have to continue paying for treatment until the  appeal is resolved.

White House fights public misconceptions

Republican misinformation campaigns have fueled public opinion about health care reform. A recent Rasumssen poll counted 61 percent in favor of repealing the health care law. The Los Angeles Times reports that to fend off Republican attacks, the White House has unveiled a new website, whitehouse.gov/healthreform. The site presents stories from around the U.S about how the law has benefited ordinary Americans. In a meeting with state insurance commissioners Wednesday, Obama, speaking about the provisions going into effect Sept. 23, said:

“These things are designed not to have government more involved in health care. They’re designed to make sure that you have basic protections in your interactions with your insurance company, that you’re getting what you paid for, that you have some basic measures of protection.”

Amendments to the 1099 rule of health care reform didn't survive in the Senate, where partisan warfare is more important than good policy. Image:Wikimedia Commons

The health care bill that passed in July had an obscure provision about 1099 forms. Health care 1099 reporting isn’t obscure anymore. To raise money for health care reform, the 1099 rule aims to cut down on tax evasion. The business community says the extra paperwork will put undue strain on small companies and kill jobs. Democrats proposed loosening the 1099 rule and making up for money lost by cutting gas and oil subsidies. Republicans proposed repealing health care 1099 changes altogether, and gutting health care prevention programs to make up the difference. Neither proposal passed a Senate vote Tuesday. The 1099 requirement remains in place. Nobody wins. Welcome to the U.S. Senate.

The 1099 rule

The 1099 rule of health care reform is a tax-reporting requirement to help pay for coverage of the uninsured. The New York Times reports that congressional tax experts said the 1099 rule would generate $17 billion in the next 10 years. Health care reform requires filing 1099s for more situations. Businesses must file 1099s identifying anyone they pay $600 or more. Health care 1099 reporting is now required not just for services, but for goods or merchandise as well. Businesses will also have to send 1099s to their vendors, suppliers and contractors. Those purchases currently go unreported, and taxes related to them often go unpaid. Business groups say it would create a paperwork nightmare as companies struggle in a weak economy.

1099 rule alternatives

To alleviate the health care reform 1099 requirement, The New Republic reports that Florida Democrat Bill Nelson proposed an exemption for small businesses with 25 workers or less. Nelson’s proposal would also raise the reporting threshold from $600 to $5,000 for all businesses. The lost revenue would be recovered by cutting government oil and gas subsidies to energy companies. Nebraska Republican Mike Johanns proposed getting rid of  health care 1099 changes altogether. To pay for it, Johanns wants to eliminate the Prevention and Public Health Trust Fund, which provides money for programs like HIV prevention, cancer screening and flu vaccination.

You were expecting results?

Both amendments to reform the 1099 reporting requirements in the health care bill failed Tuesday. Ezra Klein at the Washington Post reports that in the Senate vote, Nelson got 56 votes–a majority. But since he didn’t get 60 votes, those 56 votes were worth nothing. Johanns got 46 votes. Klein points out that most Democrats weren’t willing to weaken public health. Republicans weren’t willing to cut oil and gas subsidies to free small business owners from what they call a “job-killer.” He also adds that as long as the Senate insists on super-majorities to pass anything, party-line voting is more important than making good policy.

Being re-admitted to a hospital could be bad for your overall health. CC by mateoutah/Flickr

Health care in America is exceedingly expensive, which means  any new programs that stem from health care reform have work cut out for them. Efficient practice of preventative medicine is important, yet it’s a category where America fails miserably. A 2009 study by the New England Journal of Medicine shows that 20 percent of Medicare patients are back in the hospital a mere 30 days after release. After 90 days, that percentage climbs to 34 percent. After a year, a frightening 67 percent are back – or dead.

Re-admission is taxing U.S. healthcare

According to the Huffington Post, the cost of Medicare was $17.4 billion in 2004. That gigantic figure forced Medicare to start monitoring hospitals in order to track the high re-admission rate problem. Top offenders were penalized financially. A new industry was born amidst the turmoil; private companies would extend their efficiency expert services to afflicted hospitals. Considering that several studies show that three-quarters of all re-admissions are preventable, it seems likely that the efficiency experts have plenty of business.

Hospitals and nursing homes won’t take ownership

Lack of proper communication seems to be the common ingredient when it comes to hospitals and skilled nursing facilities providing sub-par care that leads to re-admission. Not sharing the right info on patients and medication are among the communication issues at hand. The problem grows significantly for those Medicaid patients who are older and are shuttled between general and intensive care facilities.

Medicare and insurers sometimes lack foresight

The American Geriatric Society found in a recent study that Medicare and insurance companies prefer to recommend skilled nursing facilities over inpatient rehab for stroke victims, reports the Post. This is done due to lower costs up front, but the rebound rate at skilled nursing facilities in this scenario is seven times higher. The foresight to see beyond the lower price tag is a skill Medicare and private insurers must develop.

Make your doctor give you the details

Medical care facilities will usher patients out as quickly as possible unless patients and their loved ones force them to slow down and answer questions. Ask about the risks and be sure that future care instructions are quite clear. For more info on specific questions, see the Huffington Post article listed below.

Further reading:

Huffington Post:

FDR should have thrown in some calculators, because the SSA is running out of money. Image from Wikimedia Commons.

Pundits and forecasters of doom and gloom have been saying Social Security is going to run completely out of money for some time. For this year, they’ll be right. The Social Security Administration will pay more than it will collect. This is not the first time Social Security has run in the red, either. The SSA flirted with insolvency in the early 1980s. Social Security maintains a trust fund where it holds all funds, and shortfalls are exactly what the fund is there to counteract.

Social Security payments to exceed income

The Social Security Administration will take in less for this year than it is due to spend, according to the Los Angeles Times. The trustees of Social Security and Medicare released a report on Thursday, August 5, that reveals Social Security has more payments to make to Social Security recipients than funds it is due to collect by the end of 2010. After the new health care reform bill passed, Medicare was expected to stay solvent until 2029. Medicare had previously been given until 2017 before it fell into insolvency. New incentives and regulations are expected to streamline Medicare spending without compromising how much it delivers to citizens receiving benefits.

Social Security: The ultimate trust fund baby

The Social Security Administration maintains a trust fund for itself. Tax income that’s left over after expenditures goes into the trust fund. Any shortfalls that occur are covered by the trust fund. The fund itself was created for exactly this purpose. According to the New York Times, the Social Security Trust Fund is not in danger of running out until 2037. The commissioner for Social Security, Michael Astrue, has projected that if it does, the Social Security Administration will still be able to meet 75 percent of its payment obligations.

Not enough Peters to pay for Paul

Social Security depends on tax revenue. The fewer people that are working, the fewer dollars it receives. As people live longer lives, the amount that has to be paid out increases, and therefore so do the obligations the SSA has to meet. The budget deficit that Social Security will run by the end of the year won’t affect anyone’s benefits, though, as any shortfalls do have the trust fund to fall back on.

Further Reading

New York Times

Los Angeles Times

Federal agents raided medicare fraud operations in five states and announced charges against 94 people who stole more than $251 million from the Medicare system. Flickr photo.

The Justice Department struck a major blow for Medicare fraud prevention Friday. In coordinated raids, Federal agents introduced no-nonsense health care reform to doctors, nurses, health care company owners and medical billers in five states. Authorities announced charges against 94 people in what is being called the largest coordinated series of federal health care fraud cases in U.S. history. The Medicare fraud defendants are accused of bilking the Medicare system out of more than $251 million.

Medicare fraud sting snares full spectrum of crooks

Federal agents made arrests at alleged Medicare fraud operations in five cities Friday in Miami, Baton Rouge, La., Brooklyn, N.Y., Detroit and Houston. Reporting on the Medicare fraud scheme, ABC News said that the government said doctors, nurses and health care professionals accepted cash kickbacks from medical service providers to approve services that were unnecessary or never delivered. Then the service provider would bill Medicare for the bogus services, including HIV infusions, home health care and physical and occupational therapy.

Medicare fraud crackdown key to health care reform

To battle health care fraud as part of its health care reform agenda, the Obama administration launched the Health Care Fraud Prevention and Enforcement Action Team in 2009. The team uses electronic claims data and the threat of federal prosecution to seek out the illicit billing that has become a staple of Medicare fraud. The arrests came as Attorney General Eric H. Holder Jr. and Health and Human Services Secretary Kathleen Sebelius held the first in a series of regional “summits” on health care fraud prevention in Miami. The massive Medicare fraud raid was a PR opportunity for a concerted crackdown on fraud that is a key part of the administration’s health care reform agenda.

Medicare fraud practiced in plain sight

Some of the Medicare fraud operations uncovered in Friday’s raids were brazen. The Washington Post reports that in one alleged $70 million scheme operated out of a Brooklyn, N.Y., clinic, more than 1,000 cash kickbacks were paid to Medicare beneficiaries out of a “kickback room.” An undercover investigation showed that Medicare beneficiaries lined up to receive illegal payments near a sign showing a woman with her finger to her lips warning in Russian, “Don’t gossip.”

Miami a mecca for Medicare fraud

The Medicare fraud arrests were made by more than 350 agents for the Health and Human Services’ inspector general’s office and the FBI. It was the biggest takedown of Medicare fraud offenders since the federal program was started in 1965. Miami bore the biggest harvest of crooks on the same day the health care fraud summit took place there. The Miami Herald reports that About 25 suspects, including a longtime general practitioner, were charged in Miami-Dade County for allegedly submitting about $103 million in fraudulent bills for home health care, HIV therapy and medical equipment services, according to federal indictments.

Donald Berwick was appointed to lead Medicare while Congress is in recess, denying Republicans the chance to use confirmation hearings to whip up the right wing base. Flickr photo.

Donald Berwick was appointed by President Obama to lead the Centers for Medicare and Medicaid services (CMS) Wednesday while Congress is in recess. Berwick’s recess appointment means that politicians have been deprived of an opportunity to weigh in once again on the health care reform bill that passed earlier this year. The administration says the recess appointment of Berwick helps move heath care reform along without Republican obstruction. Republicans say it’s a devious attempt to obscure Berwick’s record. Berwick, a professor at Harvard Medical School is being vilified by Republicans even though he has the support of virtually the entire health care industry.

Donald Berwick to lead Medicare overhaul

Donald Berwick’s recess appointment happened because the White House said the new health care reform law calls for huge changes in Medicare and Medicaid, which insure nearly one-third of all Americans. Dan Pfeiffer, the White House communications director, told the New York Times that the president decided to act because “many Republicans in Congress have made it clear in recent weeks that they were going to stall the nomination as long as they could, solely to score political points.”

Berwick backed by Bush appointees

Donald Berwick was nominated in April to lead the CMS. The agency has been without a permanent administrator since October 2006. The Washington Post said Berwick is the ideal choice to oversee a Medicare/Medicaid budget of $800 billion — about one-third of all health-care spending. He is recognized as one of the nation’s leading experts on improving health care quality while saving money. Two CMS administrators appointed by George W. Bush back the nomination, as well as the American Hospital Association, the AARP, the National Committee to Preserve Social Security and Medicare and a long list of local medical groups.

Republican obstruction bypassed

Despite his credentials, Republicans want to use Donald Berwick’s nomination to whip up partisan furor over “Obamacare.” The Associated Press reports that Republicans, who use “rationing” as a code word to discredit health care reform, have seized on comments like one Berwick made to an interviewer last year: “The decision is not whether or not we will ration care, the decision is whether we will ration with our eyes open. And right now, we are doing it blindly.” Berwick also drew Republican ire for praising Britain’s National Health Service.

Health care rationing revisited

The Post reports that include Pat Roberts of Kansas are trying to twist these statements. “Dr. Berwick is the perfect nominee for a president whose aim has always been to save money by rationing health care,” Mr. Roberts said on the Senate floor last month. The Associated Press article said when it comes to the rationing issue, Republicans argue that  Berwick would deny needed care based on cost. Supporters contend rationing already is done by insurance companies, and Berwick wants transparency and accountability in medical decisions.

Peter Orszag has announced he will be stepping down as White House budget director. (Photo: Center for American Progress, Flickr.com)

The director of the White House office of Management and Budget, Peter Orszag, will be leaving his post in July. Peter Orszag has been thinking about leaving the administration for a while and finally decided on leaving in  July after he was pressed by administration officials. As director of the White House budget office, Orszag has wielded significant powers within the government. The replacement for Office of Management and Budget head has not yet been announced.

Peter Orszag as budget guru

As head of the Office of Management and Budget, Peter Orszag has held a cabinet-level position. The OMB is charged with creating the annual White House budget that is sent to Congress. The OMB also provides estimates and opinions on legislation, in support of the Congressional Budget Office, upon the request of members of Congress. While in the position of budget head, Peter Orszag championed two major pieces of legislation — the stimulus bill and health care reform.

Peter Orszag’s history of service

Peter Orszag first started working for the White House in 1997. He started as a Special Assistant to the President for Economic Policy and has moved up the ranks since then. From January 2007 to November 2008, Peter Orszag served as head of the Congressional Budget Office. Peter Orszag has also made a name for himself as an official White House blogger on budget issues.

Who will replace Peter Orszag?

The replacement candidates for Peter Orzag have not yet been officially announced. However, political watchers have been throwing names around already. More likely than not, Peter Orszag’s replacement will be someone already in the White House. Some point to Rob Nabors, who has recently been attending senior staff meetings at the White House and acted as Orszag’s right-hand person from ’96 to ’98. Members of the Economic Recovery Advisory Board and Treasury Secretary counselors have also been named as possible replacements. Whoever the replacement is, President Obama has put significant power in the hands of the director of the OMB, so the budget guru better be someone up to the task.

Rising employer health care costs in the next year despite the health care reform bill are being passed along to workers in the form of higher deductibles. Flickr photo.

Employer health care costs will continue to rise this year and next, but the rate of increasing costs for employer health insurance appears to be slowing down. Despite the health care reform bill, a nine percent employer health care cost increase is projected in 2011 compared to the 9.5 percent jump expected this year. To control rising health care costs in lieu of a health care reform bill, employers are dropping medical benefits for retirees and making workers pay a greater portion of health care premiums. Workers, in turn, are settling for higher deductibles. Hospitals shifting costs from Medicare to private payers and employers is seen as the primary reason for higher employer health care costs.

Higher health insurance deductibles

Companies are trying to offset employer health care cost increases by requiring their workers to spend more of their own money before coverage activates, according to a survey of 700 employers by PricewaterhouseCoopers. The Associated Press reports that most American workers are expected to have health insurance deductibles of $400 or more. Two years ago, only 25 percent of companies participating in the PricewaterhouseCoopers survey said they asked employees to pay deductibles of $400 or more. That grew to 43 percent in 2010 and is expected to pass 50 percent next year.

Retiree health benefits disappearing

The report also found a steep drop in the percentage of employers that subsidize retiree health coverage. The survey reported that only 22 percent of employers with more than 5,000 workers subsidized retiree coverage after age 65 this year. That’s down from 37 percent in 2009.

Wellness programs: missed opportunity

To slow the growth of employer health care costs, two-thirds of the companies responding to the survey said they planned to expand wellness programs and 63 percent already offer health risk questionnaires. But Reuters reports that only 39 percent offered wellness programs in the form of weight management and just 27 percent provided nutritional training. More than two-thirds of Americans are overweight or obese, a cause of many of the most expensive health conditions such as heart disease, diabetes and cancer.

Medicare changes fuel increases

The biggest employer health care cost increases for 2011 will be in hospital and physician costs, which make up 81 percent of premium costs. Industry Week reports that hospitals shifting costs from Medicare to private payers and employers is seen as the main reason for higher medical costs. In 2011, Medicare, the single largest payer for hospitals, will reduce payment rates for the first time after seven years of increases that matched or exceeded inflation. Most hospitals are likely to shift more costs to employer-based health plans.

Health care costs: could be worse

The rate of employer health care costs, although increasing, is being held down by some recent changes in the market. CNNMoney.com reports that the cost of providing COBRA coverage–which lets laid off workers extend their health plans–skyrocketed during the recession. Employers will save money as COBRA costs are expected to return to “more normal levels” in 2011.

Generic drugs soften the blow

Another factor keeping employer health care costs from accelerating faster is that drugs representing about $26 billion in annual sales are expected to go off patent in 2011. These drugs include the world’s best-selling drug, Lipitor. Expiring patents will open the drugs up to competition from cheaper generic versions. Generics account for as much as 80 percent of all prescriptions.

The health care reform bill has inspired an AT&T strategy that involves increasing its profits by billions of dollars via denying employees health insurance. Flickr photo.

Health care reform is inspiring corporations to dream up creative strategies that avoid the obligations required by the health care reform bill. A cold-hearted genius at AT&T may have found the ultimate way to make health care reform backfire on the law’s best intentions of eventual universal coverage. The new health care law requires companies to pay a penalty for denying employees health care. It may turn out that paying the government penalty costs far less than providing coverage.

Corporate health care reform maneuvers

The quest for universal coverage spawned the idea to drop health care benefits. Fortune reports that we know this because of other cynical corporate maneuvers over health care reform. When President Obama signed the health care bill, AT&T and Verizon made headlines announcing hits on their projected earnings of about $1 billion. Why? The health care bill ends tax deduction for the federal retiree drug-benefit subsidy. For corporations, this subsidy was an instant cash loan they didn’t have to pay back. The government gave them money they didn’t earn to pay for retiree drug benefits, which they were allowed to deduct from their taxable earnings.

The announcements by AT&T and Verizon that health care reform would cost them billions of dollars infuriated Congressman Henry Waxman. He accussed them of grandstanding to exaggerate the cost of health care reform on employers. As chairman of the House Energy and Commerce Committee, he ordered them to turn over documents related to how they were dealing with health care costs.

Health care bill: unintended consequences

The unintended consequences of the health care bill are starkly outlined in the documents. Fortune reports that an AT&T PowerPoint slide entitled “Medical Cost Versus No Coverage Penalty” shows that 2009 medical costs were $4.7 billion. The federal penalty for denying coverage is $2,000 per employee. With 283,000 employees, AT&T would be penalized $600 million. By denying its employees health care, AT&T could possibly increase its profits by $4.1 billion.

Health insurance companies slither

After the health care reform bill passed, health insurance companies joined AT&T and Verizon in trying to weasel out of the law. It didn’t take long for Big Insurance to look for loopholes in the health care reform law. Starting Sept. 23, the health care bill will ban health insurance companies from denying coverage to children with pre-existing conditions. The New York Times reported on March 29 that insurance lawyers are claiming the bill’s “fine print” allows them to refuse to cover children with pre-existing conditions such as asthma, diabetes, orthopedic problems, birth defects and other illnesses.The insurance companies said the law only requires coverage for pre-existing conditions if a policy is sold–it doesn’t require the insurance companies to allow access to a policy. Riiiiiight.

Health insurance: profits or policies

Can companies be so cold-hearted to actually deny benefits because of health care reform? Fortune reports that companies say certain aspects of the health care reform bill will increase the cost of providing health insurance. Parents will be able to keep children on their plans until they are 26 years old, a benefit they say will cost millions of dollars a year. They also say they won’t be able to pass the full amount of a tax on “Cadillac insurance plans” on to their employees.

If companies like AT&T and Verizon can rake in billions of dollars in profits by not providing health care coverage, you can bet they will follow the money.

The American Spectator also supposedly found the Loch Ness Monster. Image from Wikimedia Commons.

The American Spectator, a conservative political journal, has been taken to task in the media over a story it ran about the health care reform bill. The American Spectator reported a Health and Human Services report indicated the health care reform bill would be economically harmful, and the HHS report was quashed by the staff of Kathleen Sebelius. The journal seemed to indicate the White House willfully disregarded the idea the bill would run up huge tax debt to pay for health care.  The American Spectator report was taken to task for being completely unfounded.

American Spectator blasted for spurious source

The article in question ran Monday, April 26, on the American Spectator website. It asserted that an anonymous source revealed that the Department of Health and Human Services had a report that was stifled before the vote on the health care reform bill in March. The claim is that Sebelius’ staff refused to review it and intentionally neglected to do so.

Putting words in anonymous mouths

The anonymous HHS source said “The reason we were given was that they did not want to influence the vote” and that publishing the report before the vote was “actually the point of having a review like this, you would think.” The source wasn’t named, but the American Spectator mentioned the report was conducted by the actuary of the Medicare and Medicaid office.

Medicare and Medicaid Chief Actuary sounds off

According to ABC News, the chief actuary for Medicare and Medicaid indeed had something to say.  Richard Foster, Chief Actuary for the Center for Medicare and Medicaid Services, blasted the report by the American Spectator as being completely bogus.  “I don’t know how that rumor got started,” he said, “but it’s completely unfounded.”

Richard Foster and the real report

The Spectator failed to mention that Richard Foster received the bill three days before it was voted on, nowhere near enough time to study it, or for the alleged report to have been compiled. Foster did submit a report that indicated the bill would be unsustainable due to costs. However, the report wasn’t published until the April 22, a month after the Office of the Chief Actuary actually received the bill for analysis.

Shock and awful reporting

There was enough inflammatory rhetoric about the health care reform bill without making anything up.  (The death panels thing was a real gem.) What is certainly troubling is that the government would pass such legislation before an economic analysis could be completed before voting on it.  It is also troubling that the bill would mandate purchasing insurance, which would be delivered by private insurers being paid with subsidized funds.  Wait a minute – wasn’t the insurance industry supposed to lose money?

Rep. Eric Cantor and family were threatened by Norman LeBoon with a "final Yom Kippur." (Photo: Wikipedia)

Norman LeBoon called Rep. Eric Cantor “my Congressman,” even though the Philadelphia resident lived nowhere near the office of the Virginia Congressman. However, his hate-filled YouTube message to the politician was considered a threat upon Cantor’s life; it prompted the U.S. Attorney’s office in Philadelphia to charge LeBoon with two criminal counts. LeBoon is now being held without bail, so instant money can’t spring him from jail. According to the Philadelphia Star, the law became involved when Norman LeBoon’s anti-Eric Cantor video was seen by a San Francisco resident, who in turn reported it to the FBI.

Norman LeBoon may have had nothing to do with gunshots at Cantor’s office

What is clear is that Norman LeBoon’s video bears threats to Eric Cantor and his family. It mentions a “final Yom Kippur.” Luckily, as Assistant U.S. Attorney Robert Reed told the Star, neither Eric Cantor nor his family was harmed. The shots fired at Cantor’s Virginia district office – the ones believed to have been fired in protest of the health care reform issue – have not been connected to Norman LeBoon at this time.

The messiah has a history of mental illness

As mentioned previously, Norman LeBoon is being held without bail. He is believed to be a flight risk and a danger to others. Reed told the media that LeBoon, who calls himself a “messiah” and “the son of the God of Enoch” in his YouTube videos, has a history of mental illness and will undergo psychiatric evaluation. He also has a prior arrest involving terrorist threats, assault and reckless endangerment of his roommate. That case is still open. Currently, the divorced father of two gets money now from disability.

More on the final Yom Kippur

Norman LeBoon clearly feels that Eric Cantor has a lot for which he must make atonement. In one of many rambling YouTube videos, LeBoon says, “Remember, Eric . . . our judgment time, the final Yom Kippur, has been given.” He refers to the Virginia Congressman by such colorful terms as “Lucifer,” “pig” and “abomination.”

It would seem that if Norman LeBoon were indeed a messiah, he would have been able to predict that posting such a video on a public video site would lead to the end of his ministry.

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Malcolm X called for "the ballot or the bullet." Eric Cantor and others on Capitol Hill don't deserve the tea party world's bullets. (Photo: ThinkStock)

The vote for health care reform has come and gone, but the fury left in its wake – one that has shattered the peace of Rep. Eric Cantor’s district office, among other places on both sides of the political aisle – will not soon subside. According to CNN, Eric Cantor claims that a bullet was shot “through a window” at his district office in Richmond, Virginia. Prior to that, he claims he had received threatening messages, messages he does not want to reveal for fear that doing so publicly would inspire copycats to get involved in further violent acts against himself or fellow Republicans.

Eric Cantor claims Democrats are ‘fanning the flames’ of violence

That’s what Eric Cantor says DNC chair Tim Kaine and Rep. Chris Van Hollen of Maryland have been doing: using threats made against pro-health care reform Democrats as a rallying cry to somehow strike back. Violence begets violence is the catchphrase for Washington politics at the moment, and Eric Cantor has gone on record as saying “Enough is enough.” People may need money now, but they don’t need to worry about fringe groups preventing their elected officials from representing them accurately.

Democrats are hiring bodyguards

What is it about the tea party mentality that takes them beyond rational discourse and straight onto the expressway of the lunatic fringe? More than 10 Democrats have been harassed, according to House Majority Leader Steny Hoyer of Maryland. They’ve been harassed to the point that they fear for their safety, making it necessary for them to hire extra security staff. Broken windows, a cut gas line at Rep. Tom Perriello’s brother’s home and various illiterate threats seem to come down to who supported health care reform in the end. This fight is more brutal than anything the pay day loans industry has faced.

Sweat and blood

Oscar Wilde once wrote that “When liberty comes with hands dabbled in blood, it is hard to shake hands with her.” Depending upon what side of the fence one resides on health care reform – supporting imperfect change with the possibility of future advances, or fighting to the last breath to stop the supposed socialist agenda – a person might say that bloody liberty isn’t worth it in this case. However, others might gladly shake, then lick the blood clean from their hands, savoring each drop. What kind of America do you want for your children?

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