Another health care thread.

If your insurance rate didn't go up and it had been going up xxx% per year, you received a savings of xxx%. Your rate doesn't have to go down to constitute a savings.

You can't say that costs didn't decrease. The underlying trend in costs is 10-15% a year, so if costs went up 9% instead of 13%, that is a 4% reduction. The fact that your premium didn't increase doesn't mean you didn't get a reduction. Originally Posted by pjorourke

If your insurance rate didn't go up and it had been going up xxx% per year, you received a savings of xxx%. Your rate doesn't have to go down to constitute a savings. Originally Posted by John Bull

Not disagreeing that it can't be legit...but as someone who has spent much of my adult life either reconciling/explaining corporate forecasts or sitting on the other side of the table listening to someone try to reconcile them to me...I have to say the hair on my neck stands up & the bullshit meter is on high alert when I hear something like:

"We showed net cost increases of 9% in xyz division, but really that represents great work. We were looking at a 13% increase, but due to the abc cost savings project we were able to actually save 4% this year."

Not disagreeing that it can't be legit...but as someone who has spent much of my adult life either reconciling/explaining corporate forecasts or sitting on the other side of the table listening to someone try to reconcile them to me...I have to say the hair on my neck stands up & the bullshit meter is on high alert when I hear something like:

"We showed net cost increases of 9% in xyz division, but really that represents great work. We were looking at a 13% increase, but due to the abc cost savings project we were able to actually save 4% this year." Originally Posted by atlcomedy

I agree, but in this case, you would see the results in overall profits. If costs went down 4% and the insurance company didn't pass on the savings, their margin would increase by 4% a premium -- i.e., more than double. If that happened the state's Department of Insurance would deny any further increases until the loss ratio (i.e., benefit costs as % of premium) was back in line and the "excess profit" was recovered. Despite the rhetoric coming out of Washington, insurance companies are already heavily regulated at the state level.

One thing seems clear: The implementation of this poorly-designed new health care entitlement will swell deficits in upcoming years, despite the fact that the Administration (ludicrously) touts it as a model of fiscal prudence.

As a consequence, Fortune editor Shawn Tully explains that you may soon be saying hello to a European-style value-added tax:

http://money.cnn.com/2010/03/26/news...tune/index.htm

As a consequence, Fortune editor Shawn Tully explains that you may soon be saying hello to a European-style value-added tax:

http://money.cnn.com/2010/03/26/news...tune/index.htm Originally Posted by CaptainMidnight

That bet is a lock.

That bet is a lock. Originally Posted by pjorourke

Anyone think these words might come back to haunt the prez?

How will he respond when someone plays back that little clip during a campaign ad or a debate?

"Yeah, but I didn't say anything about a VAT!"

(Perhaps that statement wouldn't go over very well.)

Anyone think these words might come back to haunt the prez?

How will he respond when someone plays back that little clip during a campaign ad or a debate?

"Yeah, but I didn't say anything about a VAT!"

(Perhaps that statement wouldn't go over very well.) Originally Posted by CaptainMidnight

The political brilliance of the Obama camp is that they passed health care, but it doesn't (for the most part) start until after the 2012 election.

He doesn't have to run in '10

Let's say there are legit signs of economic recovery in '11-12

(as an aside I argue the President gets too much credit/blame for the economy)

Even if undeserved the litmus test question for the incumbent party for the presidential election is something along the lines of "(do you perceive) yourself personally to be better off than 4 years ago."

Things could be rosy for Obama in '12 and other than that he really doesn't give a shit.

...and insinuate that that's somehow a bad thing?
! Originally Posted by CaptainMidnight

Never meant to say that....What I implied or meant to imply was that the saving were not passed on to the consumers.

Yeah, but the whole idea was to pass savings onto the consumer. Didn't happen. Just saying... Originally Posted by charlestudor2005

Well PJ and CM will argue that it did happen. Of course when you use the same argument on Onamacare they cry bloody murder!

Sorry folks, just now reading all the posts.

If your insurance rate didn't go up and it had been going up xxx% per year, you received a savings of xxx%. Your rate doesn't have to go down to constitute a savings. Originally Posted by John Bull

That is EXACTLY what Obama is arguing when he talks about bending the cost curve!

Boy you cats sure pick and choose when to pick and choose!

The political brilliance of the Obama camp is that they passed health care, but it doesn't (for the most part) start until after the 2012 election.

He doesn't have to run in '10

Let's say there are legit signs of economic recovery in '11-12

(as an aside I argue the President gets too much credit/blame for the economy)

Even if undeserved the litmus test question for the incumbent party for the presidential election is something along the lines of "(do you perceive) yourself personally to be better off than 4 years ago."

Things could be rosy for Obama in '12 and other than that he really doesn't give a shit. Originally Posted by atlcomedy

That is exactly right. Anybody that takes a step back EMOTIONALLY from the arguement understands the history of business cycles. Obama is going to hit the Ronnie Reagan of waves on that lucky cycle.

Reagan was brilliant, he was able in increase taxes on the middle class without them ever realizing it! That will be a difficult task for Obama with CaptainMidnight on his ass!

That is EXACTLY what Obama is arguing when he talks about bending the cost curve!

Boy you cats sure pick and choose when to pick and choose! Originally Posted by WTF

No picking & choosing involved. I just don't see anything in Obamcare that will bend the cost curve down. The truth is that they ended up with a zombie bill that is not going to do any good whatsoever. It will only make things worse. Case in point, the dreaded "pre-existing conditions". What we have now is a situation where the penalty for people who don't buy insurance is too low, so they won't. Then, on their way to the hospital, they can sign up and have it covered. What do you think that is going to do to everyone else's costs?

Then, on their way to the hospital, they can sign up and have it covered. What do you think that is going to do to everyone else's costs? Originally Posted by pjorourke

PJ....they do not pay a lick right now. Who do you think pays for these fuckers that do not have insurance?

The bill is a start. Would I have liked to see them revamp the entire system? Yes. But that was not going to happen. Both parties feed from that trough. I am more concerened about reforming the financial institutions.

There will be more uninsured not less as the price continues to rise.

What we have now is a situation where the penalty for people who don't buy insurance is too low, so they won't. Then, on their way to the hospital, they can sign up and have it covered. What do you think that is going to do to everyone else's costs? Originally Posted by pjorourke

PJ....they do not pay a lick right now. Who do you think pays for these fuckers that do not have insurance?

. Originally Posted by WTF

Why do I have a mental image of ambulances rolling thru a CVS drive thru so a patient can buy insurance en route to the hospital

The political brilliance of the Obama camp is that they passed health care, but it doesn't (for the most part) start until after the 2012 election.

He doesn't have to run in '10.....

Let's say there are legit signs of economic recovery in '11-12.....

Things could be rosy for Obama in '12 and other than that he really doesn't give a shit. Originally Posted by atlcomedy

That is exactly right.....Obama is going to hit the Ronnie Reagan of waves on that lucky cycle. Originally Posted by WTF

Maybe, but there are some very key differences.

Obama's actions have more in common with those of Richard Nixon and Jimmy Carter than with those of Reagan. He's simply making a bad situation worse.

It's important to remember the history of the 1970s. Nixon declared himself a Keynesian and announced his intention to stimulate the economy with massive increases in federal spending. (Sound familiar?) At the same time, he pressured the Burns Fed to plump up the money supply in order to ensure his re-election in '72. Of course, all this simply made the economy worse and stoked the fires of inflation.

People often forget that under Nixon and a liberal congress in the early '70s, social spending increased at an even more rapid rate than it had during the LBJ era. In fact, social spending exceeded military spending for the first time in the mid '70s. All this largesse had to be digested, and the economy was to pay a painful price.

After Jimmy Carter took office in 1977, he showed that he had absolutely no understanding of the seriousness of the problem. He failed to stand up to a liberal congress and appointed an even worse Fed chair (Miller) -- and inflation raged unabated. Only after his appointment of Paul Volcker in 1979, with a mandate to crush the back of inflation, did he show some seriousness of purpose. I have long argued that had Carter undertaken those painful, necessary steps two years earlier, he would have had a good chance to see the return of sound money by 1980 -- and get re-elected.

Instead, it was Ronald Reagan who reaped the benefits of a return to monetary rectitude.

I believe we may see something of a continuing cyclical bounceback for the remainder of '10, but that things could be rather more difficult in '11 and '12. We have gargantuan structural (not cyclical!) deficits, any they are going to have to be addressed sooner or later. Otherwise, we'll simply see a horrific fiscal train wreck.

Massive tax increases (such as a VAT) will impose strong economic headwinds. They are like a huge meal that must be digested, and it could be a slow process. You can't yank hundreds of billions of dollars per year out of the private sector without some pretty painful consequences.

At the same time, the Federal Reserve is going to have to climb down from ZIRP within the next year or so. Higher interest rates (at both ends of the yield curve) will make recovery problematic.

I think everyone here would like to see practical, effective health care solutions implemented. But health care is not the most critical issue facing us. Our economy is at risk of simply being swamped by a tsunami of spending and deficits, and this "reform" bill will significantly exacerbate the problem.

Three years is a long time, and maybe Obama will somehow regain control of these issues instead of simply stacking failure atop failure.

But he hasn't made a very good start.

@ CM - my point is the link between the President and the economy as it relates to an election is it is all perception. Voters in real time don't have the benefit of hindsight (and they certainly don't analyze what a previous administration or the Fed did and what the real impact of those actions was).

I agree this year, even '11-12 is full of challenges. That's why I said "if" -- if we don't show perceptible (even if not fundamentally sound) signs of recovery by Nov 12, Obama is done.

@ CM - my point is the link between the President and the economy as it relates to an election is it is all perception. Voters in real time don't have the benefit of hindsight (and they certainly don't analyze what a previous administration or the Fed did and what the real impact of those actions was).

I agree this year, even '11-12 is full of challenges. That's why I said "if" -- if we don't show perceptible (even if not fundamentally sound) signs of recovery by Nov 12, Obama is done. Originally Posted by atlcomedy

I understand, and I completely agree! Voter sentiment is all about perceptions.

My post was not directed at you, but at those who may not understand the comparisons of Obama's current situation to those faced by presidents of the past, or may fail to draw the correct conclusions from them.

Obama better hope for a 1994-style housecleaning. That would give him something to campaign against.

Absent that, I think he's probably burnt toast in '12. The country will have seen quite enough of an out-of-control left-wing agenda.