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WHY ARE HEALTH CARE COSTS SO HIGH?

September 8, 2013
communciations, Congress, economy, finance, funding, infrastructure, innovation, Insurance, Leadership, management, politics, Revenues, Uncategorized, Water Funding, water sewer management, water supplies
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Why are health care costs increasing so fast?  Did you ever wonder about that?  We keep hearing about how health care costs, Medicare, Medicare, Obamacare are going to bankrupt us, but why is that?  Why are the cots going up so fast?  It is an important challenge for local officials and utilities who generally pay the health insurance costs for their workers.  There is more to the story that we are not being told.

One problem that get identified quickly is that only 80% of the population is included in the health care system.  Many who are not are “healthy” young people who don’t demand the services.  The concept of the health care bill was to solve this problem by spreading the costs of health care across the entire population using private and public providers.  First, I think there are way more unhealthy  people included in the 20% than we realize because the political dialogue keeps focusing on the few that want to live off the grid – I feel great so I don’t need insurance.  That guy is part of the problem.  That guy gets into a car accident, gets taken to a public hospital, gets treated, gets a bill for $26,000 to fix his broken leg, refuses to pay anything, and the taxpayers get stuck with the bill.  My solution to that guy is if you don’t want to pay for health insurance, bring cash.  Otherwise, “no soup for you!” to paraphrase a famous Seinfeld episode.  Of course my doctor, nurse and therapy friends think that’s a little cold hearted. 

The next argument is the cost of doctors, therapists and nurses.  Okay, I know a bunch of them, and that’s not where the money goes.  These people have lost money in the past 10 years.  Many are going form full-time to part-time employments as Medicare, Medicaid and health insurance bureaucrats decide services are no longer needed.  They will tell you the major change in their lives is paperwork….hold that thought for a moment.

The cost of drugs comes up.  Medicare and Medicare are the largest purchasers of pharmaceuticals in the world.  So in other works, they set the lowest price by supposedly bidding the “contracts” for services. Only there is often only one provider, so exactly how does that work?   Sounds like we don’t get a good deal there, which is why the arguments for importing Canadian drugs or drugs from Mexico keeps popping up.  They get a better deal than we do and most of these are supposedly AMERICAN companies.  No home town discount (I guess I know where free agent baseball players get the idea).   And my medical friends confirm this as an issue.  Check out the comments from Mr. Falloon at Life Extension (www.lef.org) for discussion. 

So let’s go back to the paperwork discussion.  Once upon a time doctors simply sent a little paperwork to the health insurance company or the federal government and said you needed some service.  And the insurance company processed the bill for the services.  The cost was paid by insurance premiums collected by the insurance company.  Everyone was happy.  But then someone at an insurance company said, “wait we could make more money if we asked more questions and paid less for these services.  It would help our bottom line.”  So you hear the complaint that the folks at the insurance companies are deciding whether you need that procedure or not.  And contractors decide if someone needs Medicare or Medicaid services, not the government, not your doctor, your nurse or your therapist.  Not any person that knows you, but some unseen, private sector bureaucrat who’s goal is to minimize the amount of your premium spent on services so they can enhance their bottom line.  And apparently they are very effective because the health insurance industry is very lucrative.  So maybe we have stumbled onto something here.  Maybe the cost of medical coverage is more related to drugs and bureaucracy (and it is not government bureaucracy!!) than the actual cost of services.  Maybe the old system, even if there was some fraud in it, wasn’t nearly as bad as it was made out to be.  It reminds me of one of the 4 laws of City management I developed years ago:  Never give elected officials a bad alternative – it becomes a magnet.  It always worked (hence a law).  I didn’t learn why until years later when I realized, that the worst option was the one all the lobbyists lobbied for even at the local level.  It was the option where they could make the most money “fixing

SURVEYS TO FIND, WHAT YOU WANT TO FIND….

July 31, 2013
Congress, Leadership, politics, Uncategorized
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Jim DeMint is a smart guy.  He parlayed a short stint as a Tea-Party Senator from South Carolina into a million dollar a year executive position with a conservative think tank.  Then he sends out surveys to figure out where the “public” stands on certain issues.  For example: 

Because of uncontrolled spending, the federal government ran a $4 trillion budget deficit for 232012 and our national debt is not a staggering #16 billion.  Do you want Congress to take serious action to rein in out-of-control spending?  Yes or no. 

Ok, first the deficit was not $4 trillion in 2012.  So that’s a lie.  But what are the other options?  Reining in spending is not the only option, but it is the only one given.  Certainly the question is most likely to get a “yes” answer which is exactly what DeMint’s organization is looking for. 

Let’s look at another one.  

How would you consider yourself politically:  Very conservative, somewhat conservative, Independent, but lean conservative, independent, but lean liberal, somewhat liberal and very liberal.  

Clearly a “you are either with us or against us” question, but one that tells you everything you need to know about Congress and politics in general.  You can’t be in the middle.  You can’t draw the best ideas from both sides of the aisle.  Precisely the problem gripping Washington and many State capitols.  No one can compromise, so we get sequestered.  This type of polarization does not help America move forward nor does it help use solve problems. It increases the burden on local governments to address the problems that the failure to compromise at higher levels allow to persist, or may even create.

SEQUESTRATION HITS US ALL

July 23, 2013
Congress, infrastructure, Monitoring Water, planning, Sequestration, sustainability, USEPA, USGS, Water Funding, water sewer management, water supplies
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Sequestration is the word we are all using to explain the failure of the Congress to put together a budget with appropriate revenues and expenditures.  Congress can’t figure out how to reach a budget agreement, so the federal government set itself up for mandatory cuts in services. I had a recent grant sequestered, then cancelled.  It really could have helped a local community with long-term water supply and quality problems identify adaptation and mitigation strategies fo rites future.  Minor money for Washington, but a big deal down here.  Likewise I have spent the last 6 months on a subcommittee for USGS that is focusing on what could be cut from USGS.  That means less testing water quality, water levels in groundwater, stream gauges and less evaluation of results.  Most of the water issues USGS looks at crosses local and even state lines.  Since we all rely on water, this is at national concern.  Precisely when we need the information most, we may be getting less.  Expect to start seeing more sequestration issues. 

 

 

The problem is that the biggest expenses, social security and debt, cannot be cut without major backlash in the financial and voter markets.  So the cuts come from the smaller accounts – things like the federal share of state revolving funds, water research and water/wastewater programs.  The community and tribal assistance account was slashed $210 million while the environmental program budget was cut $135 million. While some may be cheering EPA cutbacks, the reality for water and wastewater users is less federal assistance to our industry.  That means more of the onus is on us, and on our customers.  The  unintended consequences of the failure of Congress to act….