When Healthcare Providers Close

/by

If you see news like this and think, “Maybe the government should step in and fix this,” think again:

Citing years of cuts and freezes in Medicaid payments, Gateway Healthcare announced on Monday that budget deficits are forcing it to close six group homes in Rhode Island for people with mental health and substance abuse issues.

About 70 residents, including 55 adults and 15 children and adolescents, will be affected when the homes close at the end of August, according to Gateway. The nonprofit agency, which is part of the Lifespan health system, pledged to either see their treatment to conclusion or transition them to “an appropriate care setting” before the homes are shuttered.

Closings like this benefit the government.  As the “provider of last resort,” the fewer other resorts there are, the more money the government can demand from the population, the more union employees it can hire, the more dollars get slushed around to their campaign accounts, and generally, the more power they have.

A government like Rhode Island’s wants more people dependent on it.  Watching private care providers for challenged populations go out of business serves that goal.

Read more

Credit for Healthcare Initiatives

/by

When you read the following, from today’s Providence Journal, who do you think ought to get credit for the innovation?

So with Governor Raimondo pushing her cost-cutting Reinventing Medicaid initiative, Neighborhood Health Plan of Rhode Island is eagerly touting what it says is the early success of a program begun just five months ago to address Medicaid subscribers with frequent and hefty medical bills.

Astute readers might pick up on the fact that the program began five months ago, which would mean the governor would have been implausibly dynamic to get it rolling, if it was possible at all.  Still, you should be forgiven if you finished the paragraph with the impression that Reinventing Medicaid is to credit.  How about this one?

Most states have not [advanced data and analytics to target high-cost insurance members], because of the intense partisanship over “Obamacare” and in some cases because of technical problems.

Instead, they rely on the federal HealthCare.gov website. Rhode Island, however, has its own health-care exchange, HealthSource RI.

So, maybe it’s HealthSource to credit, then.  But wait a moment:

The program has been in development for two years and is similar to other projects under way in the state, Trilla said. Given Reinventing Medicaid’s goals of targeting so-called “high utilizers,” he said that Health@Home has “ended up dovetailing nicely” with the governor’s efforts.

Two years ago would be May 2013, at which point HealthSource was still in development (based on wildly inflated projections).  That suggests this innovation was not driven by Governor Raimondo, and it was not driven by ObamaCare or HealthSource RI.  Rather, one can infer that it was driven by a private organization’s assessment of how it might better use its resources.

Maybe we can find our way to giving government some credit if Neighborhood’s innovation was inspired by the much-maligned Global Waiver program (to which Raimondo’s Reinventing Medicaid initiative bears some striking resemblance), but then the credit would have to go to Republican President Bush and Republican Governor Carcieri.  ObamaCare and Democrats actually hindered savings from that effort.

Read more

Dissembling on HealthSource Tax

/by

This Kathy Gregg article on Governor Gina Raimondo’s reaction to poll results showing a new HealthSource tax to be hugely negative should not slip through the cracks.  The results of the poll found 63% opposed to the tax and only 27% in favor.  Here’s Raimondo:

“It’s out of my hands. I can’t say we are not going to have the health exchange,” Raimondo told reporters Thursday, the morning the poll results were released.

“Obamacare is what is is, the Affordable Care Act is there. I had nothing to do with it. [But] we have to implement it … and pay for it. And what I tried to do is present a proposal to the General Assembly which would put the least amount of cost on business owners for the maximum amount of benefit.”

Well, no.  It’s not out of her hands.  Handing it over to the feds means that “we” — i.e., the state government — are not paying it.  True, either way, Rhode Island health care customers will be paying the bill, but the distinction between the state and federal governments is not immaterial, not the least because of the games government officials are playing with the numbers.

“So we can either give it to the federal government or we can do it,” Raimondo said, again characterizing her proposal as one that “makes sure we run it in Rhode Island at a cost which is equal to or lower than the federal government.” …

In calendar year 2016, House fiscal staff advised lawmakers the new surcharge — that Raimondo describes as a “health reform assessment” — would be 4.74 percent for individuals and 0.98 percent for small businesses. During the next fiscal year, which begins on July 1, 2016, individuals would pay an extra 3.76 percent, and small-employers 1.05 percent to raise $11.2 million.

Kathy Gregg compares this with a 3.5% federal fee that would raise $8.6 million, but that isn’t an apples-to-apples comparison.  The federal 3.5% is applied to plans in the exchange and then spread out to all health care customers with similar plans.  In other words, the effective rate for the to people actually paying would be much lower.

The HealthSource tax, by contrast, starts with the budget for the exchange and then applies its 4.7% and 1.0% fees to all plans.  In the federal case, the federal government carries all of the risk for cost overruns, because its fee is set by law.  In the state case, the state government carries all of the risk, and the director of HealthSource can just adjust the tax as she sees fit.

I’d also take issue with the assertion that “business owners” are hurting and need that lower rate.  Are individual health consumers not hurting, or are they just not organized enough to be a political problem?

Read more

Rhode Island’s Medicaid Reforms Bank on Speculation and Shift Costs

/by

As a state under annual threat of budget deficits that also has the country’s highest Medicaid cost per enrollee, Rhode Island can’t afford not to think about reforming the public health care program.

In the waning days of the presidency of George W. Bush and the governorship of Republican Donald Carcieri, the state experimented with a nation-leading“global waiver” to lower costs in exchange for flexibility.

Even though the experiment was largely successful, intervening governors and the federal Affordable Care Act (ACA; ObamaCare) appear to have blocked parts of the reform and let others peter out.

Now, progressive Democrat Governor Gina Raimondo has convened a Working Group to Reinvent Medicaid, with a collection of reforms of her own, designed to save or raise $91.1 million in state money next year–a little less than 10 percent of the state’s total Medicaid spending.

Continue reading on WatchDog.org.

Read more

On HealthSource RI on State of the State

/by

4-9-2015 HealthSource-RI: Cost, Performance, Future Funding from John Carlevale on Vimeo.

The key points come at the end, when I suggest that Rhode Islanders should see if their representatives and senators are on some of these bills for socialized medicine and never, ever vote for them again.  It’s frightening that people who want to do these things to us could get into office.

Read more

Correction on Getting Away Without Paying the New HealthSource Tax

/by

HealthSource RI has asked me to clarify my statement about how many Rhode Islanders will have their payments of the proposed new tax covered by their federal subsidies.

Read more

The HealthSource Tax and Federal Subsidies

/by

Coverage of Governor Raimondo’s proposed new tax on health insurance premiums strikes me as highly misleading:

… most individuals who buy their insurance through HealthSource would find the tax, since it would be rolled into the premium, covered by their federal premium tax credits, said [HealthSource Director Anya Rader] Wallack. Of the roughly 30,000 Health-Source customers, 88 percent qualify for the credits.

“So the bulk of individual customers won’t be paying the premium assessment; the federal government will instead be paying it,” Wallack said.  

Those who obtain coverage directly from insurers or don’t qualify for the credits wouldn’t gain that tax advantage.

If we’re particular about the use of language, then Wallack’s statement is simply not true.  In a recent WatchDog article, I estimated that the 3.8% HealthSource tax on all individual and small group premiums in the state would have to be 9.1% if it were calculated based only on the plans sold through the exchange.  That suggests that about 60% of all plans subject to the tax do not receive subsidies because they are sold outside of the exchange.

According to the latest enrollment data, 12% of Rhode Islanders who are buying insurance through the exchange also receive no subsidies.  That means that only 37% of all people on whom the tax would be levied receive federal assistance for their premiums.

I’ve asked for clarification as to whether it’s actually true that the the federal subsidies will go up to cover the insurance tax.  I didn’t think so, but with Obama as president the rules of government can change without notice, so let’s assume that charging the tax as part of a premium will indeed increase subsidies.  That’s still not the whole story.

Premium subsidies are calculated as a cap that a person would pay for the second cheapest “silver” plan on the exchange (the “benchmark” plan), as a percentage of income.  An individual who makes $10,000 a year is under the poverty level, so that would cap his annual insurance premium for a silver plan at 2% of income, or $200.  Let’s say the benchmark plan is $2,500.  The individual would pay the $200 and receive a subsidy of $2,300.

According to estimates, the new HealthSource tax would make the hypothetical benchmark plan $2,595.  So, the low-income individual would still pay the $200, but receive a subsidy of $2,395.

However, that varies with with income and with the plan.  For an individual making a little over 2.5 times the poverty level (around $30,000), the $2,500 benchmark would start to approach his cap.  Maybe he’d receive some subsidy for the tax, but not all of it.

Moreover, the federal subsidy of the tax in the example would be held at $95.  A gold plan at $3,500 would bear a tax of $133, which is $38 higher than the government subsidy would be.  According to the enrollment data, this dynamic would affect all of the 13% of customers who bought gold plans and some portion of the 65% who bought silver plans.

In other words, “the bulk of individual” insurance customers would be paying the full tax, and a significant number more would pay at least some of it.*

 

* The phrase in quotation marks should be “the bulk of individual and small group.”  See here for explanation.

Read more

Rhode Island Is Too Small to Sustain Its Obamacare Exchange, so It’s Raising Taxes

/by

“Insufficient scale to justify investment.  Do not pursue.”

Such was the conclusion of a 2009 report funded by the Robert Wood Johnson’s State Coverage Initiative to investigate then-Lieutenant Governor Elizabeth Robert’s plan for HealthHub RI.  This year, the first budget proposed by Rhode Island’s new governor, Democrat Gina Raimondo, provides proof that the study was right.

In 2009, the idea was to follow Massachusetts, Connecticut, and Washington in setting up a government-run health benefits exchange.  The hope (at least as publicly expressed) was that an exchange would help the state expand access to insurance while lowering the cost of health care.  Yet, members of the group conducting the study “were disappointed to learn that the development of a full exchange model, as established in Massachusetts, would not” accomplish their goals.

A few years later, with the help of the Obama Administration and a party-line vote in the U.S. Congress, creating the Affordable Care Act, otherwise known as Obamacare. Then following an executive order from Governor Lincoln Chafee, Rhode Island officials went ahead and set up exactly the sort of exchange that their report had warned them not to pursue, calling it HealthSource RI.

With the Affordable Care Act requiring federal funding to cease soon, Rhode Islanders are now finding out what “insufficient scale” actually means.

Continue reading on WatchDog.org.

Read more

More on Raimondo’s Outrageous Health Insurance Tax

/by

Kathy Gregg has more details on Democrat Governor Gina Raimondo’s proposed tax on health insurance in Rhode Island in today’s Providence Journal, and it looks increasingly outrageous.  First is a little budgeting trick.  The tax kicks in midway through the fiscal year, so on an annual basis, it’s actually twice the cost that the budget advertises:

Targeted to take effect in January 2016, the premium surcharge that Raimondo proposes would raise an initial $6.2 million of the $30.9 million the Raimondo administration is proposing to spend during the year that begins on July 1 to operate the state’s “health-insurance marketplace’’ over the next year.

Over the first full 12 months, HealthSource RI administrators anticipate the surcharge will raise $11.8 million.

And the rate is outrageous, too — above what the federal exchange would charge, for most users:

It would be assessed on the premiums of all health plans purchased in Rhode Island by individuals (at a rate of 3.8 percent) and small employers (1 percent).

As Gregg reports, that will be over $400 per year for some members.  The rate is also higher than the similar taxes in Massachusetts (2.5-3.0%) and Connecticut (1.35%).

One thing that is misleading, I believe, is spokeswoman Maria Tocco’s explanation that, per federal law, “a premium assessment has to be levied this way, as premiums must be the same inside and outside the Exchange for the same products.”  As I explained yesterday, the governor’s proposed language imposes the rates based on market, not plan.  In other words, the governor is taxing all plans whether or not they are offered in the exchange.

I imagine she’s doing that because the rate they’d have to charge in order to follow the method of the federal exchange and still pay for HealthSource would have made Rhode Islanders eyes pop (and further prodded the exodus of productive people from the state).  As healthcare expert Sean Parnell estimated for an article I wrote, last year, applying the federal rate to Rhode Island’s exchange would generate around $5 million.  Roughly speaking, Raimondo’s tax is more than twice as costly, so if it were structured like the federal fee, the rate would have to be up to nearly 8%.

Obviously, more plans and more people means a lower rate.  That’s why Massachusetts and Connecticut can charge less even though their exchanges cost more.  But none of this is news.  The RI Center for Rhode Island has long been saying that Rhode Island’s market is simply too small to justify its own health benefits exchange.

Even agents of the state of Rhode Island admitted this, back when they were free to be honest.  Last June, I quoted from a 2009 report reviewing the lieutenant governor’s proposal for an exchange like HealthSource.  Their conclusion back then?  “Insufficient scale to justify investment. Do not pursue.”

What’s changed that has a supposedly financially savvy governor touting this as economic development?  Perhaps that they think they can get away with it, now.

Read more

Beware: The Health Exchange Premium Fee Is a Simple Tax

/by

With publication of the legislation enacting Governor Raimondo’s budget, as House bill 5900, some of the details left ambiguous in standard budget documents can be checked.  One of the more disconcerting is the supposed “fee” assessed on health insurance premiums in the state.

The budget presentation avoids naming what the “fee” is, but the talk and reportage during and after last night’s speech by the governor presented it as a fee structure similar to the way the federal government pays for the federal health benefits exchange.

Reviewing the legislation makes it clear that this is not the case.  The new revenue stream for HealthSource RI is simply a tax.

As I explained during the last legislative session, the federal exchange fee works like so:

  • Health insurers are assessed a 3.5% fee on the premiums of plans sold through the exchange.
  • They are not permitted to charge different prices for the same plan on or off of the exchange.
  • Therefore, the price of the fees must be spread across all people who purchase that particular plan, whether on or off of the exchange.

According to the governor’s legislation, the new health insurance tax would work very differently:

  • HealthSource will determine its budget for the year.
  • That total will be allocated to the small employer market and the individual market in proportion to each market’s participation in the exchange.
  • The insurer will increase all premiums in each market by the percentage necessary to generate the necessary money.

One consequence of this different method that must appeal to our progressive governor is that it shifts the tax burden toward Rhode Islanders with more-expensive plans.  No matter what the proportion of bronze, silver, gold, or whatever plans on the exchange, the tax is a flat percentage on all plans, so people buying more-expensive plans will pay more.

A consequence that surely appeals to the state’s government-first establishment is that there’s no escape from the tax.  It doesn’t matter whether insurers participate in the health benefits exchange or not, and it doesn’t matter if they sell different plans on or off of the exchange.

But the most important consequence is that this fee is completely unrelated to actual usage of the exchange.  Again, it’s just a tax, collected via health insurance plans.

According to the governor’s budget, HealthSource will cost $30.9 million to operate next fiscal year, but $24.7 million of that is still coming from the feds.  You don’t have to agree with me that the Obama administration is breaking the law by continuing to pay for state exchanges to understand that the operating costs of HealthSource are guaranteed to grow by leaps and bounds, as federal involvement tapers off.

In other words, nobody who cares about Rhode Islanders or the local economy should want to cross this particular Rubicon.  Once this new tax is law, all bets are off.  The success or failure of the exchange becomes immaterial.  The General Assembly never has to face the heat for increasing taxes.  The bloated government start-up company that is HealthSource RI becomes just another factor driving up the costs of Rhode Islanders’ insurance.

Read more

Rhode Island’s Obamacare Lesson for the Supreme Court

/by

The 2014 session of Rhode Island’s General Assembly promised to be a perilous one for HealthSource RI, the state’s health benefits exchange under the federal Affordable Care Act, more popularly known as Obamacare. …

What’s a beleaguered government start-up company to do?  In this case, it turned to the federal government, which proceeded to ignore the language of the law (specifically, Section 1311(d)5(A)) and ensure that funding would not be an issue for the state’s upcoming fiscal year.  After all, if one of the dozen states that had set up their own exchanges — especially one lauded for being among the least-poorly done — it might have made the 2014 election season even more difficult for the president’s Democrat colleagues.

Changing the rules in order to avoid political pitfalls has become a recurring theme with Obamacare, and in government generally.  Today, the Supreme Court has begun hearings on the case of King v. Burwell, on the question of whether the Internal Revenue Service (IRS) exceeded its authority by ignoring the legal distinction between exchanges “established by the State” and those established by the federal government.

Continue reading on WatchDog.org.

Read more

Learning from the HealthSource Experience

/by

This is a predictable result of letting government run businesses:

The most common complaint into the Call 12 for Action Center over the past three months has been problems with HealthSource RI – so Consumer Reporter Susan Hogan went straight to the source to try to get some answers.

Customers are getting angry with the state-run Obamacare marketplace, saying critical health decisions are being put on hold because they can’t get a straight answer.

It’s bad enough that the government spent nine figures (that means over $100 million) putting together an organization and Web site expecting to have to handle several times more customers and is still having trouble managing the fraction that it actually has.  The real travesty, however, is that anybody with authority thought it would be a good idea to begin with.

Lest we forget, the Affordable Care Act (ACA; ObamaCare) was pushed through  by President Obama and Congressional Democrats on a party-line vote on Christmas Eve using procedural gimmicks and without having been vetted by the legislators, let alone the public.  In Rhode Island, the exchange came into being not as legislation, by an executive order from ideological governor Lincoln Chafee, and without significant public debate, and the accompanying expansion of Medicaid, which is now a major budgetary problem for the state, was pretty much a bureaucratic decision without the visible input of elected officials, at all.

Read Hogan’s article.  These aren’t insurmountable business problems, but it isn’t clear how well government agents can or will surmount them.  In a private business setting, a company that was having such problems after a year of operation despite having many fewer customers than projected would have to fix them pronto or go out of business, but for HealthSource to go out of business it takes major political battles, legislation, and horse trades for other legislation and other political incentives that have nothing whatsoever to do with healthcare.

And HealthSource represents a relatively mild leap into lunacy compared with legislation that some elected officials would like to pass.  Take H5387, for example, with lead sponsors Aaron Regunberg (D, Providence), Teresa Tanzi (D, Narragansett and South Kingstown), Arthur Handy (D, Cranston), Shelby Maldonado (D, Central Falls), and Gregg Amore (D, East Providence).

The legislation would create a new agency that would automatically register Rhode Islanders in government healthcare and collect premiums from them, while forbidding private insurers from offering competing products and setting prices for all doctors and other healthcare providers.  Picture a mandatory HealthSource that wouldn’t even have to risk going back to elected officials to raise money, if it were failing.

If a bill like that were to pass, it would be devastating for the people of the state, and it’s an indication of just how dangerous it is to elect such people to office.

Read more

Health care exists in a supposedly ‘free’ market where government sets the prices

/by

The other day, my Medicare-eligible father took the position in a discussion between us that centrally managed health care was superior to free-market health care. He cited the state of American health care as his proof.

His proclamation of evidence is nothing if not debatable (see here and here, for example), but even to acknowledge that much goes too far.  The debate starts from a false premise.

Continue reading on WatchDog.org.

Read more

Government and Media Do Rhode Island a Disservice by Spinning HealthSource

/by

It was the top headline of last Thursday’s Providence Journal: “Despite gamble, exchange pleased with 2015 signups.”  Reports Richard Salit:

Total enrollments for individuals now stands at 27,690, up from 25,288 just before the start of open enrollment in mid-November. …

HealthSource RI reports that, as of Wednesday, 6,918 people who were not previously customers had been signed up for coverage. Wallack called that figure “great.”

How does a journalist report that without noting, as Sean Parnell does on The Heartland Institute Web site, that 27,961 had enrolled by the end of last year’s open enrollment period?  The numbers may improve a little by next month, but thus far, the only reason there’s an increase is that people dropped out after enrolling last time around.

Parnell points out that HealthSource representatives do Rhode Islanders a disservice by not giving them a more objective sense of how the high-cost exchange is doing.  Writes Parnell:

Despite not coming close to their original goals, Rhode Island’s exchange leadership still touts the numbers as a success. A letter to then-Governor Lincoln Chafee from Ferguson in November 2014 requesting funding for the exchange’s operations in 2015 noted that “…27,961 Rhode Islanders had enrolled in coverage through the individual marketplace, more than doubling federal enrollment estimates.”

Ferguson continues to tout the 100,000 enrollee assumption as well. The letter to Chafee uses 100,000 enrollees as the basis for its financial calculations, which the Providence Journal reported in a story on November 19 is the “projected 2017 enrollment target.”

Of course, the news media has to be included in the accusation of disservice.  Do people buy the Providence Journal to improve their understanding of what’s going on in their state or to receive the government’s spin on what’s going on in their state?  The only (somewhat) outside-government voice in Salit’s article is Stephen Boyle, president of the Greater Cranston Chamber of Commerce, and he’s a proven booster of the exchange.

Speaking of boosters, one can’t help but notice the mention of HealthSource’s “outreach plan” in the Providence Journal article.  Not mentioned is that the paper, itself, is a big beneficiary of that plan, as evidenced by the quarter-page color ad for the exchange in its Sunday edition.

Read more

Some 2015 Predictions (HealthSource and RhodeMap)

/by

Filling in for Matt Allen on WPRO, last night, Jay Martins asked me to call in with predictions (and warnings, really) about HealthSource RI and RhodeMap RI.  Here are my notes for the call:

HealthSource

When commentator Avik Roy was looking for the perfect quotation to summarize Vermont’s aborted flirtation with single-payer healthcare in Forbes magazine, he picked Raimondo’s choice to lead HealthSource RI, Anya Rader Wallack. What she said was: “We can move full speed ahead…without knowing where the money’s coming from.”

That pretty much sums up the strategy with HealthSource RI, too. They leapt into this thing expecting the money just to materialize, and it didn’t.

The ironic problem is that Wallack’s primary job this year will be figuring out where the money’s coming from.

Prediction:  There will be some dramatic hearings and political battling with House Speaker Nicholas Mattiello (D, Cranston), but ultimately, the government insiders like HealthSource enough — mostly as a stepping stone to our own attempt at giving government all control over healthcare — that they’ll give him something substantial that he wants as a trade. What that’ll be may be the most important answer we’ll get in the next six months.

 

RhodeMap

We can only hope that this will be a big story.  RhodeMap’s going to be more interesting than HealthSource in its way. What we’re going to see are:

  • Local pro-RhodeMap/Smart Growth activists trying to get on local planning boards
  • Stealth legislation and ordinances to give planning boards more authority
  • Other stealth legislation and ordinances to push forward RhodeMap principles, which have a lot of money and insider and activist support behind them.

The big questions are:

  • How strongly cities and towns will push back
  • How insiders in the state and federal government will ultimately thwart those towns and anti-RhodeMap activists that manage to gain local traction — whether regulation, legislation, judicial hearings, or politically undermining them
  • Whether the general public’s interest (and outrage) can be maintained

Eminent domain is definitely a flash point that will grab the public’s attention, and despite assurances, RhodeMap does open the door for it, but there are many lower-grade tools in the central planners’ toolbox.  First, they’ll work on pressuring property owners through taxes, zoning, regulation, and general government harassment, all of which will offer property owners the escape hatch of devices like transfer of development rights.  (That’s when a property owner sells somebody, possibly the government, the rights to develop his or her land, which he or she technically continues to own and the buyer transfers that right in order to develop land somewhere else.)

Only if none of that works will they move forward with property takings, which isn’t likely to happen in 2015.  The targeted property owners will be outraged, but mainstream journalists don’t tend to care about individual property owners when it’s the government that’s harassing them, so the question is whether those with eyes to see will manage to weave together the bigger story and get the public to pay attention to it.

Read more

HealthSource, RhodeMap, and the Way Government Plans

/by

You may have seen Ian Donnis’s report that Governor-elect Gina Raimondo intends to replace Christine Ferguson as the head of HealthSource RI, Rhode Island’s ObamaCare health benefits exchange:

The leading candidate to replace Ferguson is Anya Rader Wallack, the president of Arrowhead Health Analytics in Fall River, Massachusetts, and a former policy director and deputy chief of staff for former Vermont governor Howard Dean. Rader Wallack declined comment when contacted by RIPR.

Ms. Rader Wallack may now have the dubious distinction of making an embarrassingly telling comment even before she’s taken office in Rhode Island.  Avik Roy quotes her in Forbes, in an article about the (inevitable) collapse of Vermont progressives’ single-payer-healthcare fantasy:

If there’s one quote that sums up the whole episode, it’s the one from Anya Rader-Wallack, declaring that “we can move full speed ahead…without knowing where the money’s coming from.” Green Mountain Care attempted to offer Vermonters more generous coverage than they currently had, but couldn’t figure out how to convince doctors and hospitals to accept pay cuts, nor workers to accept tax hikes.

That quote sums up HealthSource RI’s story pretty well, too.  As reported on the Current, Ferguson chose not to follow through with a more-detailed projection of its likely effects on the local healthcare market, and the consequences for HealthSource and the state budget could be devastating.

But this is how an organization (in this case, government) plans when everybody making decisions profits simply by being active and bears no real personal risk for failure.  It’s also how people plan when they feel like they can always take other people’s money and pass laws to force people to behave as the plans require.  We see this with RhodeMap RI, too, especially with its Growth Center plans, which have explicitly drawn purposes for land that the government does not own (and whose owners have not been consulted).

The plan for Middletown, for example, makes the particularly chilling suggestion that government operatives should include private commercial property in its planning “because properties on that side of the road may redevelop before the town-owned property does,” and the government needs to “send a message about the desired character of future development.”

Ultimately, that may be the secret to the illusion that we can simply assign ever-greater responsibility in our society to government, and the really smart people who take government jobs will simply figure out the best way to accomplish their goals.  Like novelists, they plan out a plausible reality, and where they write themselves into a corner, they assume that some literary device, some mix of regulatory demands and money confiscation, will solve the problem.

When the author’s power is infinite and the consequences for failure are borne by others, there really isn’t a reason to find evidence that a scheme will actually work.  Full speed ahead!… until the crash, followed by a new six-figure job in another state.

Read more

UPDATED: Gruber’s Brief Dealings with HealthSource RI

/by

A contract and correspondence with MIT Professor Jonathan Gruber show that HealthSource RI cut his project short and used earlier estimates that he had called “rough.”

Read more

UPDATED: Jonathan Gruber Behind Flawed HealthSource RI Projections

/by

Jonathan Gruber’s remarks about the “stupidity of the American voter” have revealed the deception behind ObamaCare, and his involvement in the planning process for HealthSource RI raises the question of how pervasive his attitude has been among government agents locally.

Read more

It’s Supposed to Be People’s Job to Make Us Less Stupid

/by

A first-pass post on that genius “MIT professor and Obamacare architect” Jonathan Gruber could be in the category of “imagine if a Republican consultant had said this.”

In case some of you get your news mainly from Rhode Island and/or mainstream national sources, I should explain that Gruber was deeply involved in the policy and marketing development of ObamaCare, and he’s apparently made it a regular part of his speaking engagements to point out how the Obama administration and Congressional Democrats deceived the American people to get the legislation into law.  Here’s one incident, and here’s another.

Inasmuch as the planners consider us too stupid to make decisions for our own good, they decided that they might as well leverage that stupidity to slip things into ObamaCare that would have sunk the legislation if the politicians had been forthright about them.

But a first-pass post wouldn’t get to the most egregious part of the story — namely, that there are people whose job it is to tell the rest of us what’s important in policy debates and other current events.  Where were they?

In an advanced society like ours, people can’t possibly keep up with the minutia of 1,000-page bills.  It’s presumptuous even to assume that a majority of people in a busy, diverse society can be expected to trace the economics of such bills even if they find out about their provisions.  Whole industries and professions exist to translate the news into the basic concepts that everybody can understand, in order to help us make better decisions for ourselves and for our republic.

In this case, one such industry is organized labor, which didn’t really begin grumbling about their objections until after the debate was over, probably because they expected a friendly administration to open up loopholes or exemptions for their members later.

The industry that deserves the most criticism, though, is the one whose reason for being is to inform all of us: the news media.  According to Gruber, then-Senator John Kerry (D, MA) was the one teaching him lessons in the stupidity of the American people.  That means not only that Kerry knew a majority of Americans wouldn’t understand the deceptive mechanisms in the law, but that high-level Democrats knew the news media would either (1) not understand economics any better than the average American, or (2) not report to the average American what the administration was actually trying to do.

So which is it?  To use the term of Jonathan Gruber: Are American journalists stupid or complicit?

Read more

RI’s Bad Decisions and Burning Money Instead of Tobacco

/by

My op-ed in today’s Providence Journal places the match of Rhode Island’s experience of the tobacco settlement money (a one-time-fix turned bad debt) on the pile of bad decisions that the state government has made in the past decade or so:

According to a review by ProPublica, Rhode Island has just refinanced some of the resulting debt, with the expectation that “the deal would shave $700 million off a $2.8 billion tab due on the bonds in 2052.” In that regard, it’s a bit like the state’s pension reform, which was marketed as salvation but merely shaved about $3 billion from $9 billion of unfunded liability.

The people who operate Rhode Island’s government are racking up quite a list of these liabilities.

Read more

RI’s Bad Decisions and Burning Money Instead of Tobacco

/by

My op-ed in today’s Providence Journal places the match of Rhode Island’s experience of the tobacco settlement money (a one-time-fix turned bad debt) on the pile of bad decisions that the state government has made in the past decade or so:

According to a review by ProPublica, Rhode Island has just refinanced some of the resulting debt, with the expectation that “the deal would shave $700 million off a $2.8 billion tab due on the bonds in 2052.” In that regard, it’s a bit like the state’s pension reform, which was marketed as salvation but merely shaved about $3 billion from $9 billion of unfunded liability.

The people who operate Rhode Island’s government are racking up quite a list of these liabilities.

Read more

Becoming the Medicaid State

/by

Yesterday, I noted that enrollment in health insurance plans through the state-government-operated HealthSource RI had dipped by August 2.  In contrast, Medicaid enrollments have continued to grow, by an average of 3,430 per month, or a five percent growth of the total Medicaid rolls from the end of March to the end of August, now up to 257,884.  That’s now more than one-quarter of the entire state population.

If we assume that all new Medicaid enrollments were through the exchange, it’s an increase of 21% since March.

 

Here’s a not-so-fun fact:  The number of new Medicaid enrollments in Rhode Island from March to August was more than five times greater than the number of seasonally adjusted new jobs based in Rhode Island.  If you want a barometer of the direction in which the state is headed, that’s a pretty good one.

Read more

When the Future Can Pay for Your Business Model

/by

The federal government’s deus ex machina act with HealthSource RI is as good an example as any of how government shouldn’t (but inevitably will) behave.  There was a little bit less than the preferred 100% certainty that the state would allocate money for its experiment in health broker entreneurialism during the last session of the state General Assembly, and the administration of big brother Obama swooped in with the cash to keep the Web site going for another year.

It wasn’t supposed to do so, under the written word of the Affordable Care Act (ObamaCare), and the state wasn’t supposed to accept it, under the written word of Governor Lincoln Chafee’s executive order creating the health benefits exchange.  But what’s the rule of law and twenty-something million dollars compared with giving government agents the opportunity to experiment with a new business model?

If the U.S. Congress and the governor have to say one thing in order to get their big-government policies implemented and then ignore the specifics when they become inconvenient, and if more imaginary money has to be pushed to the resulting agencies, that’s just the price of trying to solve all of our problems via the political system.

The combined activities of Americas local, state, and federal governments now cost more per American household than the median American household brings home in income.  The federal debt is now higher than the national GDP.  In Rhode Island, the state government is suffering the consequences of its need to fill budget gap with one-time fixes and a ratcheting squeeze on residents, who are choosing to leave.

Last week, I checked in with HealthSource RI.  After the open enrollment period ended in March, the agency had 27,961 enrolled individuals, with 21,097 having paid.  By the end of April, 25,767 had paid.  As of August 2, HealthSource counted 26,686 enrollees and 25,892 people paid up.

The federal government, in other words, gave nearly $1,000 per enrollee just for the exchange’s operating costs.  That doesn’t include the subsidies that 85-90% of the enrollees are receiving.

It takes a little bit of education and imagination to see the consequences of this behavior.  All that money comes from somewhere, and by the looks of the recent trends, it isn’t the much-vilified One Percent.  Not being able to trust that the deal that politicians make actually means what they say it means when they first say it has consequences, too.

It may be the perfect crime, though.  As the machine works its destruction, those whom it kills and those from whom it steals can’t easily see who’s to blame.

Read more

When Government Is the Biggest Client, the Biggest Competitor, and the Regulator

/by

I don’t have any additional information about what’s going on with this story, but it’s one worth watching:

The doors were locked on Monday at St. Jude Home Care as the provider of home health-care services reeled from having its privilege to bill Medicare and Medicaid terminated as a result of federal and state investigations.

But owner Priscilla Pascale invited a reporter inside to say why she believes the government actions are unjustified and nothing more than “trumped-up charges” that are the result of a “vendetta.”

Pascale doesn’t say whom it is that has a vendetta against her, but she does claim that surveillance tapes make it obvious that the inspectors came in with the goal of finding something they could use to “take us out.”

St. Jude Home Care is “one of the largest providers of home health-care in the state,” which makes it one of the largest competitors to the state’s Dept. of Behavioral Healthcare, Developmental Disabilities and Hospitals.  That means it’s one of the largest competitors to the government labor union whose members dominate lists of the most lucrative state jobs, making many times their official salaries.

Supporters of the Rhode Island status quo or big government generally are sure to claim I’m peddling a conspiracy story, because it’s critical to their ideologies that government agencies can be trusted to be intimately involved with our businesses and our lives.  (Hello, IRS.)  Still, when government becomes a provider of services for which it is also a dominant payer in industries that it also regulates, it’s far from unreasonable to think agencies might act in their own self interest in ways that would be obviously wrong to those who aren’t part of the cult of government.

Read more

Government, Academics, and Journalists… RI’s Lead Weight

/by

A Providence Journal article extolling the virtues of lead-paint regulations fails to acknowledge a downside or provide context for the harm it seeks to alleviate.

Read more

10 News Conference Wingmen, Episode 36 (Hobby Lobby, Freedom, & Health Care)

/by

Justin and Bob Plain discuss the Supreme Court’s Hobby Lobby decision and the underlying issues of freedom and health care.

Read more

Rep. Frank Ferri’s Disingenuous Objection

/by

Mike Stenhouse, the CEO of the RI Center for Freedom & Prosperity (the Current’s parent organization), testified in some strong terms against H7819, which would declare a specific structure for the state’s healthcare system and put in place the beginnings of a plan to achieve them:

“This is talk you would expect to hear come out of Communist China, not a legislative body in the United States of America,” said Stenhouse.

I would have gone with the old Soviet Union, because at the heart of the bill is a five-year plan.  For readers whose secondary-school education didn’t manage to impress upon them the significance of that construct, this About.com page captures the essence:

In the name of Communism, Stalin seized assets, including farms and factories, and reorganized the economy. However, these efforts often led to less efficient production, ensuring that mass starvation swept the countryside. …

While all of these plans were unmitigated disasters, Stalin’s policy forbidding any negative publicity led the full consequences of these upheavals to remain hidden for decades. To many who were not directly impacted, the Five Year Plans appeared to exemplify Stalin’s proactive leadership.

The “health care authority” imagined in H7819 would be no different.  It would work to push all healthcare spending in the state through HealthSource RI for the explicit purpose of giving government a monopolistic controlling hand.

Representative Frank Ferri (D, Warwick), who is the bill’s prime sponsor, waited until four more people had testified and Stenhouse was away from the witness table before responding.

By way of partial transcript:

What this says is, “we should come up with a five-year plan.  It’s talking about a plan.  A comprehensive plan.”  …

So what is wrong with having a plan?  It’s not a question.  I just wanted to make a statement, because give us something better and work with us instead of coming here and shouting “Communism” and “death camps” or whatever it is they want to shout.  Why don’t they say, “Let’s get together, and let’s work together on this.”

One thing that jumps out is Ferri’s cowardice, waiting until Stenhouse wasn’t in a position to respond… while asking rhetorical questions that could have been actual questions if Ferri had posed them at the appropriate time.  There’s also a dishonesty underlying his objection.  Ferri’s bill doesn’t establish a framework for everybody to get together and come up with ideas.  It sets a specific policy toward which the authority is mandated to work, and it’s a dangerous one.

Read more

Supporters of HealthSoviet RI

/by

Rhode Islanders shouldn’t buy what supporters of an initiative to pass every healthcare dollar in Rhode Island through HealthSource RI are selling.

Read more

Rhode Island Policy: Single Payer Healthcare and Rationing

/by

Legislation to create a “health care authority,” complete with a commissioner with no other duties, is an attempt to crack the door for government-run health care.

Read more

James Baar: Nightmare at the Exchange

/by

Erik Brown thought he had found help with his healthcare bill. Instead, he found himself trapped in a nightmare at the exchange.

Read more

FIND GREAT CONTENT

Search through articles, research, and policy papers. Search by keyword, tag, author, date range, and category.

YOUR CART
  • No products in the cart.
Subtotal:
$0.00
0