Health Care Bill — Where is the reform?

Don’t let anyone fool you — Health Care reform is essential. Why? Because from spending 1 out of $20 on health care in 1960 we have arrived at a point that we are spending 1 out of every $6 on health care now. And of course, this cost is expected to sky rocket. President Obama is right — exponentially growing health care costs, completely independent of making health care universal, will sink the American economy.

Strangely enough though, the current bill being considered by the House of Representatives is not about reform driving cost down and funding universal health care but universal health care without any meaningful reform. 

 Section 1 — CBO Report

To build the case though, allow me to start with some key facts and data points from the Congressional Budget Office’s (CBO) “Long Term Budget Outlook” published in 2007 regarding Health Care:

1. On Total Health Care Spending

A> “Total spending on health care in the United States, including both private and public spending, increased from 4.7 percent of GDP in 1960 to 14.9 percent in 2005, the most recent year for which such data are available.”  That is a greater than 300% increase in share of spending on health care obviously at a loss to other facets of life.

B> The report identifies the primary cause for this increase as, “Most analysts agree that the most important factor contributing to the growth in health care spending in recent decades has been the emergence, adoption, and widespread diffusion of new medical technologies and services.”

C> Other factors for cost increase identified in the report are rise in disposable family income, rise in insurance coverage and aging of the population.

2. On  Medicare Program

A> Overview of Medicare: “Medicare provides federal health insurance for nearly 43 million people who are aged (about 85 percent of enrollees) or disabled or who have end-stage renal disease. The elderly become eligible for Medicare at age 65; the disabled become eligible 24 months after their Social Security benefits start.”

B> Medicare is funded via various sources, payroll tax of 2.9% of taxable income, being a primary source. Think of it as money you are putting aside to be paid for medical care when you get old or, god forbid, disabled. CBO report also states, “As of June 2007, 18 percent of Medicare beneficiaries were enrolled in private health plans under the Medicare Advantage program,” i.e. were paying additional for enhanced coverage.

C> In 2006, Medicare spending totaled $382 billion.

3. On Medicaid Program

A> Medicaid is a joint federal–state program that pays for health care services for a variety of low-income individuals. The program was created in 1965 by the same legislation that created Medicare, replacing an earlier program of federal grants to states to provide medical care to people who have low income. The federal government’s share of Medicaid’s spending for benefits varies among the states and currently averages 57 percent.

B> In 2006, the total spending was $160.9B and total beneficiaries were 60.9M people. Out of which children accounted for 29.5M – approx. 50%.

Section 2 — some more key data points:

1. Americans spend $2.5T (trillion) annually on healthcare.

2. Medicaid is only 6.7% of the total healthcare bill for USA and hence hardly the cause for the crisis.

3. Kaiser Health Tracking Poll from June 2009 finds, “Struggling to afford needed care — The survey continues to find that a majority of Americans (55 %) say that they or another member of their household have put off some sort of needed medical care because of the cost over the past 12 months. About 1 in 4 say they have skipped a recommended test or treatment, and a similar percentage have chosen not to fill a prescription. 26% say they or a family member had problems paying medical bills over the past year, similar to the proportion reporting problems in our April tracking survey. This number rises to nearly half (48 %) among those suffering health problems, and is nearly as high (43 percent) among the uninsured.

Section 3 — Key observations based upon the above data

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Obama’s Budget

I am rather conflicted about the budget that Obama administration unveiled. On the one hand it has the right investment areas — Health Care reform, alternative energy (with revenue generated from carbon emission heavy industries), and education.

It  also focuses on some of the right areas for generation of revenues — like  roll-back of tax cuts for people earning greater than 250K, cut-back of subsidies to agribusinesses, pharmaceuticals and defense contractors.

However, where it fails, in my eyes, is the cut-back required on wasteful government spending — I don’t see much of that. Another troubling sign is that the deficit for the fiscal year 2009 (that ends in Sept) will be $1.75 trillion. That is staggering addition to the government deficit. He predicts that the deficit will fall to $533 billion in the last year of his term — 2013 — but that is far off in the future.

It is a bold new experiment in trying to level the playing field between the haves and the haves not. However, neither is it trim enough nor is it immediate in reducing deficit, and I fear that entropy will take over as time progresses with positive goals less pronounced and negative factors exaggerated when all of this becomes reality.

In a very perceptive article in Washington Post titled, “A Budget Process Hijacked By Selfish Interest,” Steven Pearlstein points out that it was the drive for self interest that resulted in a pluralist approach which forced competing self interests to be looked at collectively by decision makers and helped balance out the overall outcome. He writes, “It’s hard not to see the parallel between the magic of this political marketplace and the “invisible hand” of the economic marketplace as described centuries ago by Adam Smith. It is not from the benevolence of the butcher, the brewer, or the baker, that we can expect our dinner, but from their regard to their own interest,” he wrote famously in “An Inquiry Into the Nature and Causes of the Wealth of Nations.””

 However, it is clear that the system can be manipulated and short term narrow interests can take away the focus from the long term issues that are more potent and dangerous. Also, the politics of Washington ensures that such sweeping, radical bills have more angles to attack it from. And that, I am afraid, will be the undoing of the budget. For, immediate, short term gains are easy for the butcher, the brewer, or the baker and hence that is what they lobby for but long term abstract gains like a balanced federal budget, reformed health care and green energy are hard to visualize. Just like Wall Street, Congressmen will continue to focus on short term gains till uncontrolled upheaval makes long term short term and then, unfortunately, change will be impossible to implement.

Watching own knee surgery live

(Please participate in the poll at the end of the post)

My fervent desire was to “watch” my knee being operated upon. It was not out of any morbid tendencies but purely intellectual: I wanted to see with my own eyes the marvels of modern surgical techniques, the skills of surgeons and of course just exactly what I had done to my knee.  May be taking it to the next level but in line with recent articles in the news  like  “Empowered Patient” on CNN and “Patient should be there own Primary Care Providers” on the Better Health blog.

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Real smoke after the “half-smoke”?

Smoking and Obama — Why didn’t the media focus on it prior to the Election? 

Let me just get this out there — I supported Obama over McCain. And I used to smoke and quit. I mean really quit.  So There.

Now that you know, I hope you will read the remainder of this post with the same sincerity that I am writing with.

With the Inauguration for our President-Elect upon us and much more weighty worries and questions on the media and the public’s mind,  I still can’t get this one question out of my head, “Why didn’t the media focus more on Obama’s smoking habit pre-election?”  

You see, I have had this unsettling feeling inside me about this topic for quite a while and only a few days ago, was I able to articulate why I felt as such:

 “Change We Can Believe In” was his campaign slogan. So why then, Mr. Obama, when you have promised to change the very ground that we walk on, and I hope you succeed, can you not change your smoking habit?

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