The Affordable Care Act (ObamaCare) is projected to add 30 million more nonelderly persons to the insurance rolls nationwide by 2022, and Oregon intends to expand Medicaid enrollment by up to 260,000 people under the ACA. But carrying an insurance card isn’t the same as having timely access to quality health care. We also need enough medical professionals available to see us.
As the Acton Institute’s Jonathan Witt says, “A curious feature of recent U.S. health care reform efforts—easily overlooked amidst the daily media grind of canceled plans, crashing websites and new restrictions—is the irrational belief that we can extend more health care to more Americans while rendering a career as a family physician increasingly unappealing.”
A summary of a recent report by Scott Atlas of the Hoover Institution notes that “there will be an estimated additional 15 million to 24 million primary care visits, which would mean that the United States will need an additional 4,307 to 6,940 primary care doctors by 2019. This number is on top of the estimated additional 44,000 to 46,000 doctors that will be needed over the next decade and a half to meet future primary care demand, even without the ACA.”
In short, America needs more doctors―and soon. But, according to Witt, “a growing number of doctors are convinced that ‘many physicians will retire earlier than planned in the next one to three years’” due to increasing government entanglement in our health care markets. Witt explains:
My brother-in-law Bruce Woodall, a physician who has worked stateside and in the developing world, gave me another way to understand this response. Those who go into family medicine, he said, often have an independent and entrepreneurial streak. They have visions of owning a family practice one day and aren’t attracted to the idea of simply working for the government. But increasingly, that’s what family medicine in the United States amounts to. The result is that an increasing number of physicians who can leave, do.
Government currently discourages doctors from being the healers they trained to be by making it more difficult for them to treat patients, run clinics, and make a living for themselves and their families. Ever-increasing regulations, including those resulting from the ACA, are taking American health care further down that path. Add the decline in Medicare and Medicaid reimbursement rates, and today’s doctors already find themselves unable to take on more of those patients.
Another problem for future doctors is that investing in a medical degree requires new graduates to carry heavy debt loads. That investment needs to pay off in the long run. If prospective medical students don’t think they foresee a sound financial future for their practices in the years ahead, they may not choose health care professions in the numbers we need. With fewer doctors available to see us, more insurance cards in our wallets won’t mean much.
Solutions already exist which can increase access to primary care, including expanding outpatient clinics in retail settings and allowing nurse practitioners and physician assistants to provide more care for which they are medically qualified. Government at all levels should focus on removing red tape and making it easier, not harder, for doctors to operate clinics that serve basic health care needs. Simplification of regulations that hamstring doctors is a crucial part of the answer to our physician shortage. Empowering doctors “with an entrepreneurial streak” to find ways of expanding patients’ access to quality health care would be far better than continuing to expand the government’s control over an already massively regulated system.
Kathryn Hickok is Publications Director at Cascade Policy Institute, Oregon’s free market public policy research organization.
When Phil and Penny Knight announced last September* that they would offer $500 million to OHSU for cancer research if the public matched their gift, it understandably led to an outpouring of positive comments and support. But then, OHSU wanted state taxpayers to come up with $200 million of the match through a building bond. That resulted in much less positive press and some outright criticism.
Now, OHSU has modified its ask so that a $200 million building bond will be in addition to the $500 million it will try to raise from voluntary donors. That would mean a total of $1.2 billion in cancer research funds stemming from the Knight challenge.
Either way it’s presented, though, asking taxpayers to repay $200 million plus interest to house cancer researchers and clinical trial space is a questionable proposition.
Some proponents are counting on this deal to make Oregon the go-to state for top cancer researchers. But at least 67 other National Cancer Institute designated cancer centers nationwide are already competing for recognition and talent with OSHU. Other states are funding some of these centers already. It would be wonderful if future breakthroughs in cancer research came from Oregon, but this is not within our state government’s control.
Philanthropy is admirable, but forcing taxpayers to help match a private gift is a move in the wrong direction. Forced charity isn’t charity…it’s just force.
Steve Buckstein is founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.
*Audio recording incorrectly lists date of announcement as last November instead of last September.
By William Newell
The 2013 North American World Environment Day opened with a speech from Mayor Charlie Hales on the need for Portland to lead on renewable energy policy as it has on other environmental practices. As part of this renewed leadership effort, the Mayor reiterated a 2012 Portland City Council resolution which called on the City to use only renewable energy in its operations. However, this is not the first time the City has created a goal of 100 percent renewable electricity and sold it as an opportunity to lead―only to fail to get anywhere near the goal.
In reality, the Mayor was touting an objective which has existed since 2001. The goal originated as a part of the Local Action Plan on Global Warming, and it called on the City to “purchase 100 percent of City government electricity load from new renewable resources” by 2010. After the initial 2001 proposal, the City purchased three-year renewable energy credits (RECs) equivalent to about ten percent of the City’s electricity use.
Six years later in 2007, the City again tried to purchase more RECs; but the negotiations failed after the sales company decided to sell its RECs to Washington and California. The City spent more than $100,000 just to negotiate the deal.
2009 marked another important step for Portland’s green dreams with the announcement of the Climate Action Plan, which contained essentially the same goal as those proposed in 2001. This time the City would purchase or produce renewable energy with 15 percent of the energy coming from the City’s own generation by 2012. Yet again, by 2012 the City had failed to meet its goal, obtaining about 14 percent of its electricity from renewable sources and only nine percent from “self-production.” The other five percent came from state renewable portfolio standards, which mandate that utilities obtain five percent of their energy sales from renewable sources. This was a lucky development for the City, but ultimately it does little to help Portland accomplish its goal.
In 2012, the Portland City Council passed another resolution which prompted the City’s various bureaus to purchase enough RECs to “offset” 100 percent of the City’s electricity. This is the resolution on which the Mayor focused in his speech. But now, with no large-scale purchases or projects to meet the target, at the beginning of 2014 the City has yet to accomplish its goal. The City still only gets 14 percent of its electricity from renewable sources. This means the City is more than 85 percent behind meeting the objective. After more than a decade of goal setting and public speeches, the City has failed to achieve its goal. Can Portlanders really expect the City to change its behavior now, after 12 years of speeches and resolutions?
The reality is that Portlanders should not want the City to accomplish its long-overdue goal for a few key reasons. First, the proposed method of meeting the target has been through purchases of renewable energy credits, but this is a waste of city resources as RECs are no guarantee of reduced environmental impact. Second, the City has tried to produce its own energy through various means, but often through solar or wind installations―and these are wasteful and undermine grid stability.
To understand why REC purchases are wasteful, it is important to understand what they are. RECs are a commodity which represents the environmental benefits of one megawatt-hour of renewable electricity. One REC is “produced” when one megawatt-hour of electricity is generated from a source that is categorized as “renewable.” RECs are then sold, and purchasers can claim that they “used” renewable electricity.
But there are many problems with this narrative. When the City buys RECs, the purchase benefits government-favored wind operators while encouraging nothing. RECs do not require that proceeds go to expanding renewable generation capacity, and they are too inexpensive to be a sufficient incentive to expand renewable energy production. Interestingly, RECs are extremely cheap, which sounds good for the City budget, but it actually undermines their ability to spur further renewable energy development. Ultimately, RECs play second fiddle to more substantial renewable incentives like the Wind Production Tax Credit.
The main reason for the City to purchase RECs is that they are supposed to “offset” Portland’s carbon emissions from electricity use. But the credits don’t represent credible offset emissions because there is no requirement for RECs to show how much emissions were really avoided in their production. RECs cannot be tracked from creation to final purchase. Another problem with the “offset” theory is that RECs subsidize intermittent energy sources such as solar and wind. Intermittent energy sources must be backed up by other sources (possibly including fossil fuel plants), which either must be “ramped” up and down or “idled” to make up for cloudy or calm days. Relying on intermittent energy sources can actually result in more carbon emissions from existing fossil fuel plants and backup generators and a less reliable electricity grid.
The story of Portland’s 100 percent renewable energy goal is an unfortunate one. Portland hasn’t delivered on its promise, while touting failed solutions. RECs―the City’s preferred “green” solution―are not transparent, credible, or effective. Portlanders should really be thankful the City hasn’t met its own goal, which would have wasted taxpayer dollars on a questionable program.
William Newell is a research associate at Cascade Policy Institute, Oregon’s free market public policy research organization. He is a graduate of Willamette University.
In December 2013, Cascade President and CEO John A. Charles spoke to the Clackamas County Americans for Prosperity group about the dangers of the Metro regional government and their planning decisions.
By William Newell
The recent Portland School Board decision to expand enrollment at Benson Polytechnic High School exemplifies an odd mindset within the public education system. The board’s decision allows Benson to increase its enrollment from 821 to 850 students, due to public outcry over the limit. Benson was designed to handle 2,000 students, yet the school educates fewer than half that number because of district policy.
When businesses provide customers with quality products and services, they attract even more customers. Expansion is a sign of success, and businesses profit from it. Sadly, the same can’t be said of public education. When a public school succeeds, its enrollment gets capped. Its success is considered a drain on other schools: If a school is in high demand, students will flock there and neglect their “neighborhood” schools. Yet, this is the very point of having a market. Poorly performing businesses fail and successful ones rise, but everyone benefits from success.
When schools fail to meet students’ needs, students should be able to attend schools that do. This is why the Benson situation is absurd. The school board shouldn’t limit quality public education. When Portland parents want more seats in schools like Benson, the board should find ways to give them more of the educational programs and opportunities that they demand―either by expanding that school or creating more such schools in the district.
William Newell is a research associate at Cascade Policy Institute, Oregon’s free market public policy research organization. He is a graduate of Willamette University.
Please join us for Cascade’s monthly Policy Picnic led by Cascade Policy Institute President and CEO John A. Charles, Jr. on Thursday,February 27th, at noon.
Since 2002 most Oregon electricity customers have been forced to pay a monthly energy tax of at least 3% to support such groups as the Energy Trust of Oregon and the Oregon Housing and Community Services agency. Over the last decade more than one billion has been collected to improve energy efficiency and subsidize renewable power. This presentation will discuss where the money goes and outline ways to reduce or repeal the tax.
Admission is free. Please bring your own lunch. Coffee and cookies will be served. Space is limited to sixteen guests on a first come, first served basis, so sign up early.
Cascade in the Capitol: Testimony for the House Education Committee Against SB 1538 which would limit new charter school options
February 19, 2014
Testimony Against SB 1538 Before the Oregon House Education Committee
Chair Gelser and members of the Committee, my name is Steve Buckstein. I’m Senior Policy Analyst and founder of Cascade Policy Institute based in Portland.
I would like you to reject SB 1538.
Interestingly, the Senate has overwhelmingly approved SB 1525, which would make it easier for Oregon college students to take online courses from institutions outside the state. The chair of the Senate Education and Workforce Development Committee noted how fascinating it was that the proposal would break down borders standing in the way of Oregonians having more higher education learning opportunities. That seems non-controversial and clearly a good thing.
Unfortunately, by a much closer margin, the Senate also approved SB 1538, which does the exact opposite of SB 1525. It actually builds up borders that will stand between Oregon’s Kindergarten through 12th grade students and new public charter school options that might offer the very educational opportunities they want and need.
Several years ago I was watching a Portland Public Schools Board Meeting where several charter applicants were making their cases to the board.
One group wanted to start a school with, what I recall, was a particular arts curriculum. They’d jumped through all the hoops required of a charter applicant, but when the board members began commenting, it became clear that the applicant stood no chance of approval.
One board member looked at the applicants, and at the audience, and stated, “We already have one of those.”
She went on to explain that the district already had a school with a similar curriculum focus, and therefore they obviously didn’t need any more. How she knew that there was no more demand among parents and students for such a focus was unclear.
They already had one of those, so that ended the discussion.
This bill would make it even easier for Portland and other districts to write off competent, innovative charter applicants by simply stating that their schools wouldn’t advance one or more educational goals that the board had identified.
“We already have one of those” would become… “We don’t need even one of those.”
This bill would stifle innovation, and stifle opportunities for students currently “captured” by their local public schools to find any way out…to find a better fit for their educational needs.
I hope you reject it.
During January’s Tigard Initiative Public Forum, John Charles debated a Tigard City Counselor on the merits of the Tigard ballot measure that would place restraints on the Tigard City Council regarding the Southwest Corridor Plan.
Last week the Congressional Budget Office reported that the Affordable Care Act will cause Americans to work less. Significant numbers of people will choose to keep their incomes low in order to be eligible for federal health care subsidies or Medicaid. Consequently, the economy will lose the equivalent of two million full-time workers by 2017.
CBO’s analysis is rooted in ObamaCare’s complex design that includes new subsidies, taxes and mandates. For low-wage, lower-skilled or discouraged workers in particular, ObamaCare offers incentives that can force them to trade jobs for entitlement benefits.
…The law’s insurance subsidies are gradually taken away as income rises….[This reduces] the rewards for work—whether it be overtime, accepting a promotion, or training in the hope of higher future earnings.
But the White House doesn’t think this is negative. Press Secretary Jay Carney said people “will be empowered to make choices about their own lives and livelihoods” and “have the opportunity to pursue their dreams.”
However, penalizing people for increasing their earned income hurts workers in the long run. Having government programs, mandates, and regulations steadily disconnect work from reward replaces the American dream of building a better life for yourself and your family with, as the Wall Street Journal puts it, “the new American dream of not working.” If we keep following this road, not only our economy, but our spirit, will pay.
Kathryn Hickok is Publications Director and Director of the Children’s Scholarship Fund-Portland program at Cascade Policy Institute.
February 6, 2014
Testimony Against SB 1538 before the Oregon Senate Education and Workforce Development Committee
By Steve Buckstein
Chair Hass and members of the committee, my name is Steve Buckstein. I’m the Senior Policy Analyst and founder of Cascade Policy Institute, a Portland-based free-market think tank.
I’m here to ask you to reject SB 1538.
Chair Hass, the committee just approved SB 1525, which would make it easier for Oregon college students to take online courses from institutions outside the state of Oregon. You noted how fascinating it was that the proposal would break down borders standing in the way of Oregonians having more higher education learning opportunities. That seems non-controversial, and clearly a good thing.
Unfortunately, if you approve the bill we’re discussing now, SB 1538, you’ll be doing the exact opposite. You’ll be building up borders that will stand between Oregon’s Kindergarten through 12th grade students and new public charter school options that might offer the very educational opportunities they want and need.
A few years ago I was watching a Portland Public Schools board meeting where several charter applicants were making their cases to the board. One group wanted to start a school with, what I recall, was a particular arts focus. They’d jumped through all the hoops required of a charter applicant, but when the board members began commenting it became clear that the applicants stood no chance of approval.
One board member looked at the applicants, and at the audience, and stated, “We already have one of those.” She went on to explain that the district already had a school with a similar curriculum focus, implying that obviously they therefore didn’t need any more such schools. One was enough.
SB 1538, brought to you by the current Portland Public School Board, would make it even easier for Portland and other districts to write off competent, innovative charter applicants by simply stating that their proposed schools wouldn’t advance one or more educational goals that the board had identified.
Back when I was about to graduate from a Portland elementary school, I considered attending Benson Polytechnic High School. It was the one Portland public school with an emphasis on technical education, and it seemed to always have a waiting list to get in. I wondered then why the district never opened another Benson type school to meet the obvious need.
Why was “We already have one of those” the mindset then, and why is it the mindset still?
I now believe it’s because board members and administrators don’t have to be concerned about the needs of most students, because most students and their parents don’t have the means to exercise other options, such as moving near a school that better meets their needs, or paying taxes for the public school system and tuition for a private school at the same time.
If SB 1538 becomes law, this mindset of “We already have one of those” could easily morph into “We don’t need even one of those.”
This bill would stifle innovation, and stifle opportunities for students currently “captured”* by their local public schools to find any way out…to find a better fit for their educational needs.
I hope you reject it.
SB 1538 was approved on a 4 to 1 vote in the Committee and will go to the Senate floor for a vote.
Archived audio of the entire February 6, 2014 hearing is here, beginning with the hearing on SB 1525. Senator Hass’s comment about breaking down borders beginning at 08:19 into that hearing. The hearing on SB 1538 begins at 17:20, with public testimony for and against the bill. My oral testimony begins at 51:04.
* Public school districts often try to maintain or increase the percentage of eligible students living within each school’s particular geographic boundaries. This percentage is openly referred to by district officials as the “capture rate.” Anything that could reduce the capture rate of a given district school, such as creation of a new charter school, is seen by those officials as a potential threat to their capture rate goals.
February 11, 2014
Testimony Against HB 4129 in the House Revenue Committee
By Steve Buckstein
Chair Barnhart and members of the committee, my name is Steve Buckstein. I’m the Senior Policy Analyst and founder of Cascade Policy Institute, a Portland-based free-market think tank.
I’m here to ask you to reject HB 4129.
Why the state should not increase so-called sin taxes
• Funding any state program through additional tobacco taxes would add one more advocacy group to those who openly or secretly applaud more smoking in Oregon.
• Oregon’s addiction to tobacco revenues will only grow if we become dependent on those revenues to fund any new programs.
• Taxes on alcohol and tobacco are frequently justified as a means of discouraging “unhealthy” behavior. But this objective quickly gives way to a different one: raising revenue. This creates a “moral hazard” problem: sin taxes cannot simultaneously both discourage consumption and raise more revenue. For one to succeed, the other must fail.
• As cigarette smoking continues to decline, tobacco taxes will fail to fund current, let alone new, programs, punching more holes in future state budgets.
The regressivity of sin taxes
Providing health care services to specific groups of people, in this case smokers, may make some smokers better off; but it will also make other smokers and their families worse off. As you may know:
• Cigarette smoking adults are more likely to be uninsured than non-smoking adults.
• Cigarette smokers are in poorer physical condition than non-smokers.
• Cigarette smokers generally have lower incomes and less formal education than non-smokers.
• Cigarette smokers are more likely to be unemployed or unemployable than non-smokers.
In summary, increasing tobacco taxes is regressive, targeting less educated, lower-income, and sicker Oregonians.
If funding new or increased health care services for smokers is worth doing, it should be done through the General Fund so everyone participates. This avoids the moral hazard problem and is not nearly as regressive as the tax increases proposed in HB 4129.
Audio of the entire hearing is here. The HB 4129 hearing section starts at 1:03:25 into the audio.
February 2 marked the five-year anniversary of the Westside Express Service (WES), the 15-mile commuter rail line that runs from Wilsonville to Beaverton. While the train’s owner, TriMet, has emphasized the steady growth in ridership, the truth is that WES has been a failure.
A decade ago TriMet predicted that average weekday ridership for WES in its opening year of service would be 2,500. The reality was less than half of that: 1,150 in 2009.
After five years, ridership is only up to 1,880 weekday boardings.
Moreover, WES is TriMet’s most expensive fixed-route service, with an average per-ride cost of $12. Thus, even if ridership continues to grow, it will not help TriMet, since the agency loses about $10 on every trip.
Meanwhile, the independent transit district in Wilsonville―South Metro Area Rapid Transit (SMART)―began its own express bus line along the same route as WES in 2013, to service customers when WES does not operate. The costs per mile of the bus are only 3% of WES: $1.30 per mile versus $43.74 for WES.
Express Service from Wilsonville Station to Beaverton Transit Center
TriMet Express Rail
SMART Express Bus
When the train is 34 times more expensive than the bus alternative, there’s a logical policy response: Get rid of the train. It’s time for regional policy makers to consider this option.
By Dr. Jonathan Witt
If a large Oregon study is any indication, the Affordable Care Act may drive up frivolous emergency room visits and do little to improve people’s physical or economic health.
The Oregon Health Insurance Experiment began after Oregon budgeted to add several thousand people to their Medicaid rolls and held a lottery to fill the slots, giving researchers a randomized pool to test the effects of having health insurance. Winners were more likely to report being in good health and were less likely to default on medical bills. But there were also some surprising findings. For the lottery winners, getting free health insurance had no measurable effect on their incomes or on three objective health markers followed in the study: cholesterol, blood pressure, and diabetic blood sugar control.
One can only guess why it had no measurable effect on these health markers; but my physician brother-in-law, Bruce Woodall, a family physician with wide-ranging medical experience on three continents, shared with me some thoughts that suggest one possible reason. As he puts it, much of American medical care has become a sickness management industry, with the lion’s share of the industry’s resources spent treating not the elderly but chronically sick middle-aged patients, most of whom are sick primarily because of lifestyle choices.
In essence, the health care industry becomes the enabler in a lucrative game in which patients put off needed lifestyle reform, opting instead for prescription pills, surgeries, and conversations about “genetic predispositions.” None of this gets at the root problem, and indeed exacerbates the root problem. People face a moral challenge to accept responsibility as stewards of their bodies to live a healthy lifestyle. The system, instead of spurring them on to do the responsible thing, all too often invites them to believe they are not responsible and should entrust their genetically hopeless selves into the hands of the medical/pharmaceutical industrial complex.
If the health care market weren’t subsidized and hyper-regulated, the patient would bear more of the economic costs for living an unhealthy lifestyle, which at least would give the patient a strong economic incentive to do the right thing by his body. But thanks to various nanny state interventions, the patient is shielded from many of the economic costs of inaction. Meanwhile, the health care industry goes right on making money, never mind that it’s ostensibly being paid to heal.
Understand, it isn’t just that the health care industry continues making money off the customer even if he remains chronically ill. It’s that the gravy train keeps on rolling only if he remains chronically ill, and insured.
In fairness to ObamaCare, it does contain provisions allowing employers to charge higher premiums to employees who don’t meet certain wellness benchmarks. But applauding the government for this is a bit like applauding your kidnapper for finally allowing you to go to the restroom when you feel like it.
The government never should have been in the business of preventing or allowing insurers to decide what they could and couldn’t charge for health insurance. The process of competing for customers would have sorted this out, provided government had restricted itself to such core tasks as enforcing contracts, promoting contract transparency, and punishing fraud.
For instance, with healthy competition and choice, an insurer who tried to overcharge a physically fit pack-a-day smoker would likely lose the customer to an insurer whose rate more accurately reflected the actual risks of insuring such a person. Instead, because the whole system is fastidiously managed from the top down, with healthy market competition largely squeezed out of the game, ObamaCare’s provisions to boost economic incentives for healthy living have a fussy, nanny-state quality about them, with red tape and unintended consequences likely to come as thick and fast as the Affordable Care Act itself.
The most recent finding of the Oregon Health Insurance Experiment contradicts another ObamaCare selling point. Among those who won the Medicaid lottery, investigators found “increases in emergency-department visits across a broad range of types of visits, conditions, and subgroups, including increases in visits for conditions that may be most readily treatable in primary care settings.” In other words, the free health insurance encouraged patients to visit the ER instead of the more-affordable doctor’s office.
A Washington Post article by Sarah Kliff quotes one researcher on the topic:
“I would view it as part of a broader set of evidence that covering people with health insurance doesn’t save money,” says Jonathan Gruber, a health economist at the Massachusetts Institute of Technology, who has also studied Oregon’s Medicaid expansion but is not affiliated with this study. “That was sometimes a misleading motivator for the Affordable Care Act. The law isn’t designed to save money. It’s designed to improve health, and that’s going to cost money.”
Gruber seems to be offering straight talk here, but look closer. Gruber was one of the architects of ObamaCare and, as Kyle Wingfield noted at the Atlanta Journal-Constitution, Gruber was singing a very different tune in October. “The Affordable Care Act is already working: Intense price competition among health plans in the marketplaces for individuals has lowered premiums below projected levels,” Gruber said then. “As a result of these lower premiums, the federal government will save about $190 billion over the next 10 years, according to our estimates.”
More immediately, even Gruber’s newfound straight talk about ObamaCare veers away from the grim reality uncovered by the Oregon study. Yes, the Affordable Care Act won’t be particularly affordable. But while it may improve people’s sense of being in good health, it may do far less to improve the actual health of America—at least if the clinical health markers of 10,000 lottery winners in Oregon are any indication.
Jonathan Witt, Ph.D. is a research fellow and writer at the Acton Institute. He is the lead writer for the PovertyCure initiative and associate producer and lead scriptwriter for the PovertyCure DVD Series. He has written three documentary scripts, including The Call of the Entrepreneur and The Birth of Freedom; and his academic and opinion essays have been widely published. He is a guest contributor for Cascade Policy Institute.