Category: Healthcare

That's it, we're going on a hunger strike

Fresh Spinach for Indifferent Students: Oregon’s Costly Farm-to-School Program

By Helen Cook

When did you last hear a child profess his love for spinach?

Oregon’s Farm-to-School program awards grants to school districts across Oregon to give them the funds needed to purchase fresh foods from local farms and vendors. Advocates hope that by using the words “fresh” and “local,” K-12 students will nurture a healthier taste for fruits and veggies. This hope prompted legislators to budget almost $15 million for the program at the end of the 2019 session.

This is a significant increase from the program’s $200,000 budget in 2012, largely because legislators rephrased the bill to allow entities separate from Oregon school districts to accept grants. This technical rewording allows for summer meal programs, nonprofits, and even the local vendors selling food to the districts to accept grant money.

But frozen foods benefit students more than local produce does. Frozen fruits and veggies have equal or superior nutritional value and lower costs. This is important for school districts who prepare meals by the thousands.

Since the program’s main benefit is not Oregon’s students, I suggest the state reevaluate the expensive Farm-to-School program to be more cost-effective and call this current grant program what it is: a subsidy for local vendors.

Helen Cook is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Reform of Oregon’s Foster Care System Is Long Overdue

By Justus Armstrong

Are we failing Oregon’s foster kids? A January audit from the Secretary of State uncovered serious shortcomings in how Oregon’s Department of Human Services has handled foster care, including chronic mismanagement and irresponsibility, overburdened caseworkers, and a common practice of children with nowhere else to stay having to sleep in hotels or their caseworker’s office.

Oregon’s child welfare system is deeply flawed and in need of reform. Many internal reforms to Oregon’s DHS have been recommended, but Oregon could take additional steps to improve the situation by contracting out child welfare services to private agencies. Doing so would relieve the overburdening of the state agency and allow other organizations and members of the community to assume responsibilities that the state has failed to fulfill.

Other states have already implemented privatization with promising results. After shifting to a privatized child welfare system, Kansas saw a decrease in the average length of stay in foster care and an increase in adoptions; and Michigan was able to relieve their overburdened caseworkers while saving taxpayers’ money.

It will take careful effort to implement a similar system in Oregon, but making our state a safer place for foster kids is long overdue. Privatization provides an opportunity for substantial change in the right direction, and we need change now more than ever.

Justus Armstrong is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Direct Primary Care Puts Patients First, Lowers Health Care Costs

By Justus Armstrong

Could forgoing health insurance make health care more affordable? That’s the approach taken by many physicians practicing direct primary care, or DPC, an emerging medical movement that seeks to cut out the middleman and put patients first. Instead of billing insurance for individual services, physicians charge a regular fee as low as $60 a month directly to patients, increasing patient access and letting doctors focus on quality of office visits over quantity. Under a direct primary care model, your doctor is more available, with easier appointment scheduling and direct access to medical advice via phone, text, or email. A better doctor-patient relationship allows more personalized care, and research into DPC has yet to find a single instance of malpractice.

Health care without a third party brings entrepreneurship to medicine and saves patients money. While most direct primary care providers recommend patients carry a high-deductible insurance plan to protect against emergencies, taking insurance out of the equation for regular medical expenses allows physicians to reduce their overhead and provide better quality at a lower price.

Oregon is home to many direct care facilities; but current law requires direct providers to obtain a separate license through the state insurance agency, making direct primary care unnecessarily difficult. Let’s get rid of the red tape and take health care in a new direction.

Justus Armstrong is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Right to Try Goes National

By Steve Buckstein

Last week President Trump signed a national Right to Try law, allowing terminally ill patients the right to try drugs that have gone through part of the FDA testing process but are not yet approved.

In 2015 Cascade Policy Institute helped craft Oregon’s Right to Try law, but with two troubling restrictions. First, patients must be 18 years of age or older; and second, “in a physician’s reasonable medical judgment” patients will die within six months.

Neither of these restrictions is in the new federal law. One of the witnesses at the bill signing was Diego Morris of Arizona. Diagnosed with a deadly form of cancer when he was just 11 years old, Diego was denied a possible treatment because it was not approved in the U.S. It was, however, approved in other countries; so his family spent months in England where Diego was treated. Years later, he is still cancer-free.

Diego came to Oregon in 2015 to help us pass Oregon’s law. When someone asked him whether such laws offer false hope to desperate patients, this then-fourteen-year-old teenager answered: “There is no false hope, only hope.”

We hope that as legal issues are clarified, the new national law will “trump” Oregon’s law and offer all terminally ill Oregonians real hope for a better future.

Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.

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If Health Care Becomes a “Fundamental Right,” Who Pays for It?

By Steve Buckstein

The Oregon House of Representatives has voted for HJR 203, which would add a section to the Oregon Constitution making health care a “fundamental right.” If passed by the Senate, voters will be asked in November to put this language in our Constitution:

“It is the obligation of the state to ensure that every resident of Oregon has access to cost-effective, medically appropriate and affordable health care as a fundamental right.” 

I object to defining health care as a right on a philosophical level, because in America rights don’t come from government; government protects our natural or God-given rights. But on a political level, I understand that government tries to grant such rights all the time.

A key argument against this proposal is the recognition that a “fundamental right” to health care would seem to trump everything else, since the Oregon Constitution doesn’t currently recognize any other “fundamental rights.” If the legislature tries to make good on this “fundamental right,” what happens when voters reject the new taxes needed to pay for it?

The unintended consequences of codifying health care as a “fundamental right” are almost endless. But that’s the way the game is played for now, and the next inning will play out in the Oregon Senate before the end of this short legislative session.

Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Why Health Care Should Not Be Defined as a “Fundamental Right”

By Steve Buckstein

The Oregon House of Representatives has voted for HJR 203, which would add a section to the Oregon Constitution making health care a “fundamental right” of every Oregonian. If passed by the Senate, Oregon voters will be asked in November to put this language in our Constitution:

“It is the obligation of the state to ensure that every resident of Oregon has access to cost-effective, medically appropriate and affordable health care as a fundamental right.”

Cascade Policy Institute board member Michael Barton, Ph.D. and I testified in opposition to earlier versions of this legislation. Dr. Barton gave us a history and philosophy lesson, explaining how the American government was founded on the principle that government does not grant rights, it simply protects our inalienable rights such as those to life, liberty and the pursuit of happiness. He explained that our rights define what we are free to do without interference; they are not goods or services that others must provide for us. He expounded on these concepts in his 2006 Cascade Commentary, “Right to Health Care Violates Individual Rights.”

While I object to defining health care as a right on a philosophical level, on a political level I understand that government tries to grant such positive rights all the time. In this case, passing this constitutional amendment will make some people feel good. It may say that we care deeply about the uninsured; but it only gives intellectual lip service, if that, to the matter of future costs.

More and more people will say, “I have a right to not care about the costs, because I have an unqualified right to health care.”

Define health care as a fundamental right, and cost control will go out the window. Witness Oregon’s public school system, where education is supposedly “free” and yet taxpayers are asked to pay more and more for little (if any) improvement in real quality. As in education, health care innovation will become mired in bureaucratic process.

And who will have the task of controlling the economics? Is the Oregon legislature going to assume responsibility for that? An elegantly composed commission? A superhuman future governor? Or do we assume private insurance companies will simply figure it out?

A key argument against this proposal is the recognition that a “fundamental right” to health care would seem to trump everything else in the Oregon Constitution. If the legislature comes up with a plan to make good on this “fundamental right,” what happens when voters reject the new taxes needed to pay for it?

Since neither education, transportation, criminal justice, nor any other state government service is defined as a “fundamental right” in our Constitution, then funding for these services might be cannibalized to fund the one “fundamental right” in that document, health care. But voters won’t be presented with this reality when marking their ballots in November. This potential clash of essential services may make for strange bedfellows in future election battles. Will the teachers union, for example, want to lose funding to the health care providers?

The unintended consequences of this proposal are almost endless. But that’s the way the game is played for now, and the next inning will play out in the Oregon Senate before the end of this short legislative session. Stay tuned….

(This article is an update on a legislative post, published here, regarding an earlier version of this legislation which was considered in 2008.)

Steve Buckstein is Senior Policy Analyst and Founder at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Measure 101 Deserves Your No Vote

By Steve Buckstein

By now you should have your ballot for the January 23rd statewide election asking you to vote Yes or No on Measure 101. It would let Oregon state government raise some additional $300 million this biennium on health care after it has already misspent several times that amount in recent years.

In addition to wasting $300 million on the Cover Oregon website that failed to sign up one person for health insurance, the state has been paying $280 million a year for nearly 55,000 Medicaid recipients recently found to no longer qualify or who failed to respond to an eligibility check. The state also overpaid health care organizations some $74 million over three years to provide expanded Medicaid coverage to some Oregonians.

More recently we learned that the state may have “erroneously paid, allocated, inaccurately recorded or over-claimed $112.4 million in health care funds.”

Measure 101 will tax some hospitals and add a tax to the health care premiums of many Oregonians. It will raise the cost of health care as these taxes are passed on to consumers and patients. These taxes are unfair, hitting some while exempting others. Furthermore, based on the recent failures of the state to spend health care monies properly, there is no assurance that this new money will be spent properly, either.

Measure 101 deserves your No vote.

Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.

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dont allow skimming of medicaid funds for unions

Don’t Allow the Skimming of Medicaid Funds for Unions

By Aaron Withe and Steve Buckstein

Each year, hundreds of millions of dollars are skimmed off the top of Medicaid payments intended for some of society’s most vulnerable citizens and used for purposes never envisioned by the program’s supporters. Most of us can agree this is wrong.

After all, the whole point of Medicaid is to help low-income individuals—particularly the elderly and disabled—whose lives, dignity and comfort all benefit from the program.

Unfortunately, many politicians don’t see it this way. Oregon is one of nine states that allow labor unions to get a slice of the Medicaid pie by skimming union dues from the Medicaid paychecks of home-based caregivers.

The home-care program allows Medicaid-eligible individuals to avoid institutionalization by receiving daily living assistance in their own homes. In Oregon, Medicaid clients employ approximately 30,000 home-care and personal-support workers (HC/PSWs)—often their own family members—who are compensated through the program for providing basic assistance.

In 2000, however, the Service Employees International Union (SEIU) successfully inserted itself into that arrangement.

It funded a ballot measure that allowed HC/PSWs to be unionized on the shaky logic that their Medicaid payments made them “public employees.” As a result, the state deducts an average of $500 per year in SEIU dues from each caregiver’s Medicaid payments and sends it to SEIU before the assistance money ever reaches the caregiver.

In states where this is happening, caregivers and their clients are understandably upset. Because unions have a limited role to play between family members in a home-based setting, many feel the idea of paying for traditional union services just doesn’t make sense.

Some have pursued legal action to prevent the worst of the dues-skimming abuses. In 2014, the U.S. Supreme Court took up the Harris family’s case and ruled that “partial-public employees” like HC/PSWs could no longer be forced to pay a union against their will.

But it hasn’t been enough. Although the Harris decision technically allows HC/PSWs to make their own choice about whether to pay union dues, Gov. Kate Brown’s complicit administration has continued skimming dues from the Medicaid payments, making it easy for SEIU to keep thousands of caregivers paying dues against their will.

Kyle Osburn, a Portland resident who cares for his disabled son, was one such caregiver. Kyle never signed up for SEIU membership, but the state confiscated dues from his Medicaid checks anyway. Others, like Diana Berman, tried to cancel their union payments after Harris but were told they weren’t allowed to resign until an arbitrary 15-day annual window.

Thousands of caregivers in Oregon remain victimized by the SEIU’s dues-skimming scheme.

And Oregon isn’t alone. At least eight other states deduct dues from Medicaid checks and divert the money into union bank accounts. This practice inevitably goes hand-in-hand with shocking reports of what unions will do to obtain “authorization” for such payments, including forging caregivers’ signatures and pressuring them to sign union cards.

It’s clear federal action is needed to protect the integrity of Medicaid, its beneficiaries and caregivers nationwide.

The U.S. Department of Health and Human Services should immediately adopt administrative rules to ensure that Medicaid dollars are not misdirected toward union dues. Congress could also make it illegal to skim Medicaid funds in this way.

Either move would protect caregivers’ freedom to join a union if they chose to. Preventing state governments from deducting dues from Medicaid checks would make it far easier for caregivers to exercise their rights under Harris, but would in no way prevent caregivers from joining a union and paying dues on their own.

Medicaid dollars should be preserved for improving the lives of disabled, elderly and other Americans in need. They shouldn’t be diverted to special interest groups that often use those dollars for political gain, like propping up the politicians who skim dues for them in the first place.

Federal policymakers should take action now.

Aaron Withe is the Oregon director of the Freedom Foundation, a think and action tank in Salem. Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s Portland-based free market public policy research organization. This article originally appeared in The Bend Bulletin on December 8, 2017.

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Vote NO on Health Care Tax Measure 101

Vote NO on Health Care Tax Measure 101

By Steve Buckstein

Oregonians will have the opportunity in January to vote No on Ballot Measure 101, thus rejecting new taxes that the state legislature and the governor tried to impose on health insurance premiums and hospital services. While these and other taxes are meant to shore up state funding of Medicaid services to low-income Oregonians, it has become clear that the state has been misspending such funds for years.

Voters’ Pamphlet statements for and against Measure 101 were due by November 13, and Cascade Policy Institute submitted an Argument in Opposition which you can read below. In it, we noted three ways that the state has mismanaged over $650 million in health care funds entrusted to it by state and federal taxpayers. But, that may be far from the final number.

On November 17, four days after the Voters’ Pamphlet deadline, Oregonians learned that the state may have “erroneously paid, allocated, inaccurately recorded or over-claimed $112.4 million in health care funds, according to a letter Oregon Health Authority (OHA) Director Pat Allen sent to Oregon Gov. Kate Brown. Allen also told state legislators that “the state was likely to see more processing problems come out of the state’s health agency.”

These revelations were too late for Cascade, or anyone else, to include in our Voters’ Pamphlet statements. So voters will need to keep up with all the reasons to vote No on Measure 101. More reasons may emerge when the Secretary of State releases an expected audit of the OHA by early December.

An early version of the Voters’ Pamphlet for Measure 101, including the full text of the Measure and Arguments in Favor and in Opposition can be found at the Secretary of State’s website.

Here is Cascade’s Argument in Opposition:

STOP NEW SALES TAXES ON HEALTH INSURANCE PREMIUMS
AND HOSPITAL SERVICES

Vote No on Measure 101.

Oregon state government has a long history of mismanaging “other people’s health care dollars,” including:

  • Wasting $300 million federal tax dollars building a website, Cover Oregon, that wasn’t able to sign up a single person for health insurance.
  • Paying $280 million a year for nearly 55,000 Medicaid recipients recently found to no longer qualify or who failed to respond to an eligibility check.
  • Overpaying health care organizations $74 million over three years to provide expanded Medicaid coverage to some Oregonians. The state initially only asked for $10 million of those overpayments back, and under political pressure eventually asked for the rest.

As one Oregon economist notes about the taxes in Measure 101:

“The law explicitly allows the new taxes on health insurance providers to be passed on to consumers. With these new taxes, that Silver ACA plan will cost about $625 more in 2019 than in 2018. It’s not just 40-year-olds who will get hit with the insurance tax. Nearly 12,000 college students…will pay the tax. Small group employers…will pay the new tax.

“Taxes on hospitals will raise the costs of care across the board….The cost of these taxes also will be passed on in the form of higher deductibles and premiums. Even if you don’t go to the hospital, you will be paying the hospital tax through higher insurance prices.”*

The cost of health care is already too expensive for many Oregonians. Don’t let the state add even more taxes onto services that are expensive enough already, especially when it has such a poor track record spending the health care tax money it already gets from us.

Say No to these new health care sales taxes.

Vote No on Measure 101.

*source: Health Care Tax Would Hurt Middle Class
at: CascadePolicy.org/Health-Care

(This information furnished by Steve Buckstein, Cascade Policy Institute.)

Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.

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When Is a Health Care Tax Not a Tax?

When Is a Health Care Tax Not a Tax?

By Steve Buckstein

Oregon state legislators who voted for you to pay higher health insurance premiums and higher hospital costs don’t want you to think you’ll be paying more because they raised taxes. In their words, they aren’t raising taxes at all; they’re simply putting assessments on these services and letting insurers and hospitals pass on the extra costs to you.

Three legislators who don’t want you to pay these higher costs collected more than enough voter signatures to place Referendum 301 on the ballot in January, so you can vote No and stop these new taxes from going into effect.*

The problem is, when you see your Voters Pamphlet and ballot, you won’t see the words “tax” or “taxes” anywhere in the official statements. You’ll only read about “assessments.” Apparently, tax supporters think you’re more likely to approve them if you don’t believe they’re taxes at all.  Assessments sound so much more palatable, don’t they?

Referendum supporters have asked the Oregon Supreme Court to require that the official statements refer to taxes, not just assessments. Whether this happens or not, hopefully enough voters will understand that they’re being asked to impose new taxes on services that are expensive enough already, and vote No. Learn more at StopHealthCareTaxes.com.

*Referendum 301 is now known as Measure 101 on the January 23, 2018 Oregon ballot.

Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Health Care Tax Would Hurt Middle Class

By Eric Fruits, Ph.D.

Many Oregonians are now spending as much on health insurance and health care as they are on their mortgage payments. The Oregon legislature recently passed House Bill 2391 (signed by Governor Kate Brown) that will spike these costs even higher.

The law provides $605 million in new funds to the Oregon Health Authority. The money is meant to fill the fiscal hole made by the state’s costly expansion of Medicaid under the Affordable Care Act (ACA). Most of the money will come from taxes on health insurance providers, hospitals, managed care providers, and insurance provided through the Public Employee Benefits Board (PEBB).

Two of Oregon’s largest insurance providers on the ACA exchange have been approved for double-digit premium increases: Kaiser at almost 15 percent and Providence at more than 10 percent. For a 40-year-old with a Silver ACA plan, that amounts to an increased cost of about $500 a year.

The law explicitly allows the new taxes on health insurance providers to be passed on to consumers. With these new taxes, that Silver ACA plan will cost about $625 more in 2019 than in 2018. It’s not just 40-year-olds who will get hit with the insurance tax. Nearly 12,000 college students who buy their own health care as a requirement of attending a public college will pay the tax. Small group employers—such as the local coffee shop, auto repair, or bookstore—will pay the new tax.

Taxes on hospitals will raise the costs of care across the board. Emergency room visits, surgeries, diagnostics, and even childbirth will be hit with this new sales tax on hospital services. The cost of these taxes also will be passed on in the form of higher deductibles and premiums. Even if you don’t go to the hospital, you will be paying the hospital tax through higher insurance prices.

Because of the tax on the PEBB, local governments and school districts will also pay higher prices to insure their employees. These higher costs will lead to further cuts in staffing and services. Oregon’s already crowded classrooms will almost certainly get more crowded as districts struggle to fund the PERS crisis and higher insurance costs.

Medicaid providers are also hit with the tax. Because they do not have the pricing flexibility of other providers, they will have a harder time passing on the higher costs to consumers. Instead, they likely will reduce payments to doctors, nurses, and staff. With reduced payments, these professionals may decide to get out of the Medicaid market, thereby worsening the current shortage of Medicaid providers.

The Oregon Health Authority reports it recently removed nearly 55,000 people from its Medicaid program, after the state found they no longer qualified or failed to respond to an eligibility check. State auditors said in May that each of these Medicaid enrollees costs Oregon, on average, about $430 per month, or more than $550 million a biennium. These new savings alone more than cover the legislature’s tax increases.

While nearly everyone will be hit with the cost of these taxes, Oregon’s middle-class families will be hit the hardest. The Census Bureau reports that more than half of Oregon’s uninsured are adults between the ages of 25 and 64 who are not in poverty. These middle-class Oregonians surely want health insurance but have been priced out of the market. According to estimates by the Kaiser Family Foundation, about half of the individuals buying insurance on the Obamacare exchange get no subsidies under the law. This has been called “the middle-class loophole of no help.” Adding the legislature’s new taxes will drive more of the middle class to take their chances with being uninsured. Is this really the state of health care we want for Oregon?

These taxes can be stopped. StopHealthCareTaxes.com is now collecting signatures to put Referendum 301 on the ballot, allowing voters to repeal about $320 million in new taxes on health insurance and health care.* It would save the average household more than $200 a year in new taxes. Middle-class families will see even bigger savings. The referendum won’t stop the cost of health care from rising, but it will stop things from getting worse than they already are for Oregon’s middle class.

* The Referendum did collect enough signatures and is now Ballot Measure 101 on the January 23, 2018 Oregon ballot. A No vote will keep these taxes from going into effect.


Eric Fruits, Ph.D. is an Oregon-based economist, adjunct professor at Portland State University, and Academic Advisor for Cascade Policy Institute, Oregon’s free market public policy research organization. A version of this article appeared in The Portland Tribune on September 21, 2017.

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You Can Stop New Health Care Taxes

By Steve Buckstein

The Oregon Health Authority has finally removed nearly 55,000 people from its Medicaid program because an audit found they no longer qualified or failed to complete an eligibility check. At $430 a month per person, this can save taxpayers some $550 million a biennium.

This tremendous savings means that there is even less reason to let some $320 million in new health care taxes go into effect next year.

Why should some Oregonians have to pay a new tax on their health insurance premiums, and why should many hospitals have to pay a new tax on their income that will be passed on to patients?

If you are a registered Oregon voter, you can sign the petition to put these new taxes on the ballot by going to StopOregonHealthCareTaxes.com. Signatures should be returned in the mail no later than October 1, which is less than two weeks away.

Assuming enough signatures are gathered, the Referendum will appear on a special election ballot in January. You will then have a chance to undo what the legislature and the Governor tried to do, which is make health insurance and health care even more expensive than they are now.

So sign the petition, and then vote against these new health care taxes.


Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Cascade Policy Institute Endorses Referendum 301 to Stop New Health Care Taxes on Oregonians

August 2, 2017

FOR IMMEDIATE RELEASE

Media Contact:
Steve Buckstein
(503) 242-0900
steven@cascadepolicy.org

PORTLAND, Ore. – The Cascade Policy Institute Board of Directors has voted to support State Referendum 301 which seeks to refer certain taxes approved in House Bill 2391 to the November 6, 2018 General Election ballot (unless the date is changed to January 23rd by an Act of the legislature).

The Referendum primarily seeks to refer some $333 million in new taxes, in the form of a 1.5 percent tax on health insurance premiums and a new 0.7 percent tax on certain hospitals. The Referendum does not affect the rest of HB 2391 which specifies how the state collects money to pay for the Oregon Health Plan, the state’s version of Medicaid, through assessments and taxes on health care providers.

Signatures must be filed with the Secretary of State’s office no later than October 5, 2017. The petitioners request that all signatures be returned to them no later than October 1.

Cascade Senior Policy Analyst and Founder Steve Buckstein has written in favor of the Referendum and now makes the following statements about why the Institute believes that Oregon voters should sign it:

• The Oregon legislature passed, and the Governor signed, a bill designed to generate some $550 million in new taxes on health care, hospitals, and health insurance premiums. Ostensibly, this money is needed to help balance the budget, even after strong revenue growth, and to help maintain the controversial Medicaid expansion.

• Since the bill’s passage, it has become clear that that nearly half the Medicaid recipients checked in recent months no longer qualify for benefits. This alone eviscerates the supposed need for most or all of these new tax revenues.

• Referendum 301 only targets the most egregious of the taxes in HB 2391. It allows Oregon voters a say in whether or not they want to slap a sales tax on health care.

• According to an Oregonian editorial, when word got out that someone might refer these new taxes to the ballot, legislative leaders showed “how they’re willing to protect that new revenue at all cost—even hijacking the referendum process at the core of Oregon’s identity.”

• The Oregonial editorial went on to say, “Worse, however, the bill tosses aside the usual process requiring impartial groups to describe the measure on the ballot and in the voter’s pamphlet. Instead, [they gave] all that power to a committee made up of four Democrats and two Republicans.” They also moved the referendum vote up from November 2018 to a January special election that will cost taxpayers more than $3 million. As of August 2, the Governor has not yet signed this referendum hijacking” bill, but is expected to do so.*

Petitions can be downloaded from StopHealthCareTaxes.com. They should be properly signed by registered Oregon voters and returned no later than October 1 to:

Stop Healthcare Taxes
29030 SW Town Center Loop E, Suite 202, #514
Wilsonville, OR 97070

Questions to the petitioners can be addressed to info@stophealthcaretaxes.com.

* The  Governor did sign the bill changing the election date. The Referendum did collect enough signatures, and is now Ballot Measure 101 on the January 23, 2018 Oregon ballot. A No vote will keep these taxes from going into effect.

________________________________________
Cascade Policy Institute is a 501(c)(3) non-partisan, non-profit public policy research organization. Its mission is to promote public policies that foster individual liberty, personal responsibility and economic opportunity in Oregon.

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Oregon’s New Health Care Taxes Are Unjustifiable

By Lydia White

Soon after the Oregon Legislature passed a bill expected to generate $550 million of tax revenue to help pay for Medicaid, the state found nearly 45% of all Medicaid recipients are currently ineligible to receive health care benefits.

The bill imposes a sales tax on health insurance premiums and hospital revenue that will be borne by Oregonians. For example, 217,000 people in the individual market and over 11,000 college students who buy their own health insurance are among the hundreds of thousands of Oregonians who will pay. Local Oregon school districts will pay some $25 million and community colleges will likely be forced to raise tuition costs, all because of these new taxes.

If the state hadn’t awarded Medicaid benefits to over 37,000 unqualified people, costing $191,000,000, wasted over $300,000,000 on the failed Cover Oregon insurance exchange website, or spent an additional $166,700,000 on another failed IT system, even proponents of these new sales taxes would have had a hard time justifying them.

Fortunately, Rep. Julie Parrish (R) and two other state legislators are gathering signatures to refer these taxes to the ballot at what might be a January special election. They need almost 59,000 voter signatures by October 5th to qualify for the ballot.

To help hold Oregon’s political leaders and health care bureaucracies responsible, download and sign a petition at StopHealthCareTaxes.com.*

* The Referendum did collect enough signatures, and is now Ballot Measure 101 on the January 23, 2018 Oregon ballot. A No vote will keep these taxes from going into effect.


Lydia White is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Stop Health Care Taxes dot com

By Steve Buckstein

The Oregon legislature just passed, and the Governor signed, a bill designed to generate some $550 million in new taxes on health care, hospitals, and health insurance premiums. Ostensibly, this money is needed to help balance the budget, even after strong revenue growth, and to help maintain the controversial Medicaid expansion.

According to an Oregonian editorial, when word got out that someone might refer these new taxes to the ballot, legislative leaders showed “how they’re willing to protect that new revenue at all cost—even hijacking the referendum process at the core of Oregon’s identity.”

“Worse, however, the bill tosses aside the usual process requiring impartial groups to describe the measure on the ballot and in the voter’s pamphlet. Instead, [they gave] all that power to a committee made up of four Democrats and two Republicans.”

They also moved the referendum vote up from November 2018 to a January special election that will cost taxpayers more than $3 million.

The petitioners have just 90 days to collect nearly 59,000 valid voter signatures to refer the most egregious of these new taxes to the ballot.

These allow insurance companies to pass on to many of us, their policyholders, a new 1.5 percent tax on health insurance premiums in the state, at a time when premiums are rising out of sight already.

If you want to vote on the new premium taxes, go to StopHealthCareTaxes.com, download, sign and return a Petition sheet today.*

* The Referendum did collect enough signatures, and is now Ballot Measure 101 on the January 23, 2018 Oregon ballot. A No vote will keep these taxes from going into effect.


Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.

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“Facing Reality” Report Offers Solutions to Governor Brown’s $1.7 Billion Budget Hole Without Raising Taxes

FOR IMMEDIATE RELEASE

Media Contacts:

Steve Buckstein (503) 242-0900

Jeff Kropf (541) 729-6229

PORTLAND, Ore. – Cascade Policy Institute and Oregon Capitol Watch Foundation jointly released a new report Wednesday, entitled Facing Reality: Suggestions to balance Oregon’s budget without raising taxes. The report offers practical solutions to fill Governor Kate Brown’s estimated $1.7 billion budget hole without raising taxes.

Facing Reality is the third budget blueprint in a series: In 2010 and 2013 Cascade Policy Institute and Americans for Prosperity-Oregon published Facing Reality reports that offered state legislators an opportunity to “reset” state government using the time-tested principles of limited government and pro-growth economic policies.

“Oregon has over one billion dollars more to spend than the last budget but is still nearly two billion short because Governor Brown’s budget continues out-of-control and unsustainable spending,” said Jeff Kropf, Executive Director of Oregon Capitol Watch Foundation. “It’s time to face the reality that raising taxes will never provide enough money to build the fantasy utopia envisioned by the Governor and current legislative leadership. There is no free lunch, and new taxes are only going to hurt the poor and the middle class.”

Facing Reality outlines $1.3 billion in reduced spending in seven specific areas which, coupled with small across-the-board agency reductions, equals $1.7 billion, enough to fill the Governor’s estimated budget hole and removing the need to raise taxes.

“Keep in mind that even with our Facing Reality budget reductions, the state of Oregon will still be spending more money than the previous budget,” said Steve Buckstein, Senior Policy Analyst and Founder of Cascade Policy Institute. “The reality the Governor and the legislature must face is that the bill for years of overspending is coming due, and raising taxes that hurt the economy is not the answer. Reducing how fast spending grows is the sustainable way forward.”

This third Facing Reality report offers politically possible solutions to meet the needs of Oregonians. It still gives most state agencies more money to spend, but without enacting new taxes being proposed by the several dozen tax increase bills introduced for consideration in the 2017 legislative session.

Here are the seven specific budget reductions proposed in Facing Reality:

Solution Impact
PERS—$100,000 cap $135 million
Department of Administrative Services—halt additional hiring $120 million
Medicaid—opt out of ACA expansion $360 million
Cover All Kids—reject expansion $55 million
Department of Human Services—targeted reductions $321 million
Department of Human Services—cash assistance reforms $160 million
State School Fund—reject Measure 98 $139 million
Total $1,290 million

For agencies not identified for specific reductions in the report, across-the-board reductions of about three percent from Governor Brown’s budget would eliminate the shortfall she identified. If this plan were implemented, none of the tax and fee increases outlined in the Governor’s budget would be necessary.

Buckstein and Kropf note, “Most Oregonians must face their own family budget realities every day. Facing Reality is a good-faith effort to hold our state government to the same budgetary realities. We look forward to working with state legislative and executive branch leaders to help implement such realities in 2017.”

Read the full report here: Facing Reality: Suggestions to balance Oregon’s budget without raising taxes

Founded in 1991, Cascade Policy Institute is a nonprofit, nonpartisan public policy research and educational organization that focuses on state and local issues in Oregon. Cascade’s mission is to develop and promote public policy alternatives that foster individual liberty, personal responsibility, and economic opportunity.  Oregon Capitol Watch Foundation is a 501(c)3 charitable educational foundation dedicated to educating Oregon citizens about how state and local governments spend their tax dollars by researching, documenting, and publicizing government spending and developing policy proposals that promote sound fiscal policies and efficient government.

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Oregon Leaders Must Reject ACA’s Medicaid Expansion

By Eric Fruits, Ph.D.

Despite an eight percent increase in general fund revenues, Governor Kate Brown and some lawmakers say the State of Oregon is facing a $1.7 billion budget shortfall in the 2017-19 biennium. In her inaugural address, the governor blames more than $1 billion of the shortfall on the state’s choice to expand Medicaid and other taxpayer-funded insurance. The Census Bureau estimates that about one in four Oregonians are in the state’s Medicaid program.

In addition to the expansion provided by the Affordable Care Act, the governor seeks new state money to expand single-payer public insurance to those who are not “lawfully present” in the United States, under a program called Cover All Kids.

Although the federal government pays a large portion of the costs of Medicaid expansion, the state’s share of the costs is growing under the ACA. The huge costs of Medicaid mean even a small increase in Oregon’s share has big impacts on the state’s budget. State Senator Elizabeth Steiner Hayward, incoming co-chair of the Ways and Means Committee for Human Services indicates that about one-third of the deficit at the Oregon Health Authority comes from what she called a “minuscule” reduction in the federal match. This deficit is certain to grow as federal support for expansion shrinks over time, as outlined in the ACA.

The state has massively underestimated the costs of Medicaid expansion in Oregon. A 2013 report prepared for the state estimated that the Medicaid expansion would cost Oregon’s general fund $217 million in the upcoming 2017-19 biennium. Janelle Evans, budget director for the Oregon Health Authority, now estimates a cost to the state’s general fund of at least $353 million. For the federal government, the cost of Oregon’s Medicaid expansion will cost more than $3.5 billion over the next two years.

Oregon simply cannot afford the ACA’s Medicaid expansion and Governor Brown’s expensive new entitlement. Nationally, expansion costs and enrollment have grown much faster than projected. Previous expansions of the Medicaid program have resulted in crowding out, the process by which taxpayer funded Medicaid replaces private health insurance. These earlier expansions have seen crowd-out rates ranging from 15 percent to 50 percent, depending on the type of expansion. Not only does the expansion crowd out private insurance, government spending on the expansion crowds out funding for other state and national priorities, such as education, infrastructure, and defense.

In Congress, repeal of much of the ACA is imminent. Oregon Congressman Greg Walden, incoming chairman of the House Energy and Commerce Committee, is working on a timeline for repealing major provisions of the health care law, including the expansion of Medicaid. In the absence of repeal, Congress should consider an enrollment freeze approach. A freeze would halt new enrollment while allowing current enrollees to stay in the program until their incomes climb above eligibility limits. It would be an intermediate step towards repeal with immediate benefits for taxpayers and current enrollees.

However repeal of the ACA rolls out, Oregon’s congressional delegation should be at the forefront of ending the Medicaid expansion as soon as possible. While Congress works through the details, Oregon can take steps in the upcoming legislative session to protect the state’s fragile finances. One first step would be to opt out of the ACA’s Medicaid expansion and reject Governor Brown’s proposal to expand coverage even further. As noted in the governor’s inaugural address, the state’s choice to expand Medicaid is the single largest source of the impending budget deficit. Rejecting the health care law’s expansion is the clearest path to fiscal solvency and financial responsibility.


Eric Fruits, Ph.D. is president and chief economist at Economics International Corp., an Oregon based consulting firm specializing in economics, finance, and statistics. He is also an adjunct professor of economics at Portland State University, an Academic Advisor to Cascade Policy Institute, and author of Cascade’s report, The Oregon Health Plan: A “Bold Experiment” That FailedThis article originally appeared in The Oregonian on January 27, 2017.

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What Would Jefferson Advise Today’s Supreme Court About the Little Sisters of the Poor?

In 1804 an Ursuline nun in New Orleans asked Thomas Jefferson to clarify in writing her religious community’s right to retain their property and to continue their ministries without government interference following the Louisiana Purchase. As French Catholic Louisiana was being incorporated into the Anglo-Protestant United States, the nuns were concerned about the status of their institutions under U.S. law. President Jefferson assured her that the government would not interfere with the sisters’ property, ministries, and way of life. In a letter dated May 15, 1804, he wrote:

“I have received, holy sisters, the letter you have written me wherein you express anxiety for the property vested in your institution….The principles of the constitution and government of the United States are a guarantee to you that it will be preserved to you, sacred and inviolate, and that your institution will be permitted to govern itself according to its own voluntary rules, without interference from the civil authority.”

Jefferson confidently promised that the American Constitution would protect the nuns and that the government would leave them alone. So why don’t Catholic sisters today even qualify for a religious exemption from ObamaCare’s insurance mandate that requires contraception and abortion coverage? It may seem unbelievable, but according to the Obama Administration’s definition of “religious employer,” sisters are not included.

On March 23 the U.S. Supreme Court will hear oral arguments on behalf the Little Sisters of the Poor (and other religious clients of the Becket Fund for Religious Liberty) in a historic religious freedom case. The Little Sisters are a nearly 200-year-old religious community dedicated to caring for the elderly poor. They run 30 homes in the U.S. (four in the West) and care for nearly 13,000 people in 31 countries.

During implementation of the Patient Protection and Affordable Care Act (ObamaCare), the Department of Health and Human Services (HHS) directed most employers to include coverage of contraceptives and abortion-inducing drugs in their employee health insurance policies, or else pay a fine of $100 per employee, per day. The Sisters subsequently filed suit against the federal government, saying “they cannot, according to their faith, include contraceptives in their employee health plan.”

The Becket Fund, which represents the Sisters and other religious clients in their lawsuit, explains:

“The Court’s decision will finally resolve the crucial question of whether governmental agencies can, wholly without legislative oversight, needlessly force religious ministries to violate their faith….The [HHS] mandate forces the Little Sisters to authorize the government to use the Sisters’ employee healthcare plan to provide contraceptives and abortion-inducing drugs—a violation of their faith—or pay massive fines, which would threaten their religious mission.”

The “HHS Mandate” has a narrow conscience exemption that applies only to organizations whose purpose is solely to inculcate religious values and which employ and serve primarily members of their own faith. The exemption does not include religiously affiliated or faith-based institutions which serve all people without discrimination (like hospitals, colleges, schools, and social service agencies). And it doesn’t apply to communities of nuns.

“The Little Sisters should not have to fight their own government to get an exemption it has already given to thousands of other employers, including Exxon, Pepsi Cola Bottling Company, and Boeing,” said Becket Fund Senior Counsel Mark Rienzi. “Nor should the government be allowed to say that the Sisters aren’t ‘religious enough’ to merit the exemption that churches and other religious ministries have received….It is ridiculous for the federal government to claim, in this day and age, that it can’t figure out how to distribute contraceptives without involving nuns and their health plans.”

Thomas Jefferson explained to the Ursuline nuns of 19th-century Louisiana that American law would protect them and their institutions, regardless of the differences among American citizens:

“Whatever the diversity of shade may appear in the religious opinions of our fellow citizens, the charitable objects of your institution cannot be indifferent to any; and its furtherance of the wholesome purposes of society, by training up its younger members in the way they should go, cannot fail to ensure it the patronage of the government it is under. Be assured it will meet all the protection which my office can give it.”

We can only imagine what Jefferson might think of American women having to sue the Obama Administration to defend their First Amendment rights. But can we doubt he would be dismayed by how intrusive and coercive the federal government has become since the day he wrote so cordially to a group of French nuns about the safeguards of the American Constitution?

 

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The Jayne Carroll Show Interviews Jared Meyer on Washington’s Betrayal of America’s Young People

Guest host Aaron Stevens interviewed the Manhattan Institute’s Jared Meyer on The Jayne Carroll Show (1360 AM KUIK) on October 21. In this 8-minute interview, Jared talks about how entitlement programs and the Affordable Care Act disadvantage young people to benefit those with much higher net worth. If you missed Jared’s fantastic presentation at Ernesto’s Italian Restaurant on Thursday night, you can hear his radio discussion with Aaron here.

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How Washington Is Disinheriting American Kids

By Jared Meyer and Kathryn Hickok

Is Washington, D.C. disinheriting America’s kids? You bet. Achieving the American Dream will be more difficult for the next generation because policies and programs created by politicians and bureaucrats in Washington restrict economic opportunity for the young.

The expansion of entitlement benefits and government services places a major future financial burden on the young. The federal government’s $18 trillion debt is only the tip of the iceberg. Unfunded liabilities driven by Social Security and Medicare push the total federal fiscal shortfall to more than $200 trillion.

The Affordable Care Act has raised health insurance premiums for younger adults. While people under 30 only spend an average of $600 a year on health care, young people cannot pay less than one-third of what older people pay.

And these are only two examples of the financial burden our government is placing on the next generation.

Many think a larger government, and higher taxes to pay for it, would benefit young people. This isn’t true. The key to restoring Millennials’ lost economic opportunity is for government to get out of people’s way.

Washington is robbing America’s young. Our country is facing a crisis, and change is essential for young people to achieve the kind of future their parents and grandparents worked hard to build. Otherwise, the bill will eventually come due, and the next generation will pick up the tab.

Jared Meyer is a fellow at the Manhattan Institute for Policy Research and the coauthor with Diana Furchtgott-Roth of Disinherited: How Washington Is Betraying America’s Young (Encounter Books, May 2015). Cascade Policy Institute will host Meyer to speak on this topic in Portland on October 22, 2015. Kathryn Hickok is Publications Director at Cascade Policy Institute.

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Washington’s War on Millennials

By Jared Meyer

Tens of millions of Americans are between the ages of 18 and 30, and achieving success will be more difficult for these so-called Millennials than it was for young people in the past. This is because politicians and bureaucrats in Washington have put in place policies that restrict economic opportunity for the young.

It does not have to be this way.

Washington’s expansion of entitlement benefits and other government services places a major future financial burden on the young—one that many did not even vote for. The federal government has a debt of $18 trillion, but this is only the tip of the iceberg. Unfunded liabilities driven by Social Security and Medicare push the total federal fiscal shortfall to more than $200 trillion.

As if this were not enough, the Affordable Care Act has raised health insurance premiums for the young in an effort to pay for older Americans’ health care. Now, even though people under 30 only spend an average of $600 a year on health care, young people cannot pay less than one-third of what older people pay.

In elementary and secondary school, ineffective teachers are protected from being fired. This serves the interests of older teachers and their unions, but it harms those who would benefit from high-quality teachers. Common-sense reforms to improve education outcomes such as vouchers and charter schools are consistently opposed by teachers unions.

In their college years, young people are encouraged to attend a university even though four in ten college freshmen fail to graduate within six years. The current system of excessive federal student aid raises the cost of college tuition, which forces students to take on mountains of debt.

As if this were not enough, after high school or college graduation, Washington and state governments prevent young people from entering the job market. Occupational licensing requirements are meant to protect public safety, but often they mostly protect established businesses and workers. This comes at the expense of everyday consumers, entrepreneurs, and young workers, as unnecessary licensing makes many promising career paths too prohibitively expensive or time-consuming to enter.

Minimum wage laws, though they may seem well intentioned, make it more difficult for young and low-skilled workers to acquire valuable experience. Again, the government is telling young people that they are not free to work. Destructive labor-market laws need to be scaled back so that the first step on the career ladder can again be within reach.

Some think that if government were larger and gave more handouts, and taxes were raised to pay for these programs, then young people would do better. However, this would only make matters worse. Government tends to pick winners and losers, and the politically unorganized young are ineffective at lobbying for their interests. The key to restoring Millennials’ lost economic opportunity is for government to get out of their way.

Washington is robbing America’s young. Our country is facing a crisis, and change is essential for young people to achieve the future they deserve.

Jared Meyer is a fellow at the Manhattan Institute for Policy Research and the coauthor with Diana Furchtgott-Roth of Disinherited: How Washington Is Betraying America’s Young (Encounter Books, May 2015). Cascade Policy Institute will host Meyer to speak on this topic in Portland on Thursday evening, October 22. This article was originally published by The Salem Statesman Journal.

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Policy Picnic – September 16, 2015


Please join us for our monthly Policy Picnic led by Cascade guest speaker Herb Grey


Topic: The Regulatory State: The Revival of Absolutism

Description: 

Today our lives are increasingly regulated by decisions of unelected bureaucrats at all levels of government, from simple zoning and land use decisions to IRS audits to judicial pronouncements imposing monetary sanctions and other conditions ordaining how we conduct business (and with whom).

Is this a necessity required by the complexities of modern life, or merely the raw exercise of government power as old as kings and queens? What do the United States and state constitutions say about it? Should we as citizens continue to tolerate it? What, if anything, should we do to limit or stop it?

Herb Grey is a Beaverton attorney with almost 35 years of civil practice experience handling a variety of cases, including constitutional and civil rights litigation in state and federal courts, as well as practicing before administrative agencies. He is a member of the Oregon State Bar and is admitted to practice in all Oregon state courts and before the U.S. District Court in Oregon, the Ninth Circuit Court of Appeals, and the United States Supreme Court.

Herb is an allied attorney affiliated with Alliance Defending Freedom, a Christian public interest law firm, and a long-time member of the Christian Legal Society. Herb is currently serving as lead counsel defending Aaron and Melissa Klein, dba Sweet Cakes by Melissa, in a high-profile freedom of conscience case investigated, charged, prosecuted, and decided by the Oregon Bureau of Labor and Industries and Commissioner Brad Avakian, now on appeal.

There is no charge for this event, but reservations are required as space is limited.

Admission is free. Please feel free to bring your own lunch.
Coffee and cookies will be served. 
 
Sponsored by:
Dumas Law Group
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Taxpayers Ultimately Get the Bill for Oregon’s Medicaid Expansion

By Thomas Tullis

Thirty states have already undertaken the Medicaid expansion encouraged by the Affordable Care Act. In Oregon, more than one in 4 people are now enrolled in Medicaid. Enrollment is nearly twice as high as originally thought, and now lawmakers are looking at a half-billion-dollar state deficit after grossly miscalculating the projection.

In an attempt to reconcile the $300 million Cover Oregon fiasco, the Kitzhaber administration had centered in on fast-track Medicaid enrollment. Oregonians were incentivized and encouraged to sign up for Medicaid, with ObamaCare extending the eligibility requirements to adults earning up to 138% of the federal poverty level.

With the expansion’s 76% increase in monthly enrollment, Oregon’s growth is second only to Kentucky. While many states have not expanded and have seen little to no growth in enrollment, Oregon boasts some of the highest percentages of average annual growth in Medicaid spending over the last few years.

As the federal government will soon require Oregon and other states to be responsible for part of Medicaid costs, lawmakers are already talking about increasing the nearly two-billion-dollar bipartisan hospital tax that Governor Kate Brown signed in March.

Health insurance policy is in desperate need of market-based reforms. A competitive free market can ensure quality and affordability. Government handouts and regulations simply drive up costs that in this case will be borne by taxpayers.

Thomas Tullis is a research associate at Cascade Policy Institute, Oregon’s free market think tank. He is a student at the University of Oregon, where he is studying Journalism and Political Science.

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“Right to Try” Is a Good First Step, Should Be Expanded

By Anna Mae Kersey

Oregon House Bill 2300 gives terminally ill patients access to potentially life-saving drugs or investigational products not yet approved by the FDA that they might otherwise die waiting for.

While the necessity of such a bill is largely uncontroversial, and since last year more than 20 states have passed similar legislation, restrictions are included in Oregon’s law that severely limit the types of terminally ill patients who would be eligible for this kind of treatment.

As passed unanimously by both the House and the Senate, HB 2300 leaves out children with fatal illnesses and patients in the early stages of cancer or progressive neurodegenerative diseases like ALS, and instead holds them subject to the same restrictions as those seeking “Death with Dignity” or assisted suicide. These patients, who have the possibility of living long and fulfilling lives during which their illnesses might be contained, if not eliminated, are denied this prospect, along with the fundamental human right to care for themselves.

HB 2300 is a good start in the direction of increasing medical autonomy for the terminally ill in Oregon. However, in future legislative sessions the law needs to be expanded so that terminally ill patients seeking to exercise their “Right to Try” are not subject to the same constraints as those seeking the “Right to Die.”

Anna Mae Kersey is a research associate at Cascade Policy Institute, Oregon’s free market think tank. She recently graduated from Mercer University in Macon, Georgia with an Honors B.A. in Philosophy and is pursuing a Master’s of Liberal Arts at St. John’s College in Santa Fe, New Mexico.

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Press Release – Oregon Right to Try Bill Unanimously Passes the House and Senate

July 6, 2015

FOR IMMEDIATE RELEASE

Media Contact:

Steve Buckstein

503-242-0900

steven@cascadepolicy.org

Oregon Right to Try Bill Unanimously Passes the House and Senate

PORTLAND, Ore. – Oregon’s Right to Try bill, HB 2300 B, passed 29-0 in the Senate and was re-passed with some restrictive amendments in the House by 60-0 last week. It now goes to Governor Kate Brown’s desk for her signature. The law will give some terminally ill Oregonians the Right to Try experimental drugs and devices not yet approved by the FDA.

Cascade Policy Institute founder Steve Buckstein noted, “The final bill is more restrictive than similar statutes in 21 other states (with its 18-year-old minimum age limit and its six-months to expected death definition of terminal illness), but it’s a good start and hopefully can be expanded in the future to cover children and people who have terminal illnesses such as ALS where patients may live for a number of years.”

Buckstein thanked House Health Care Committee Chair Mitch Greenlick (D), committee member and work group leader Knute Buehler, MD (R), and Senate Health Care Committee Chair Laurie Monnes Anderson (D) for all their hard work on the bill. He noted that these three legislators started working on this legislation before the session even started, and stuck with it all the way to final unanimous passage in both houses.

Buckstein also thanked the Goldwater Institute of Arizona for pioneering the Right to Try concept around the country and for its help in Oregon. He also thanked Diego Morris, the Arizona teenager who had to move to London for treatment approved in Europe but not in the United States when he contracted terminal osteo sarcoma at age eleven. The treatment was successful and Diego is now cancer free. Diego and his mother Paulina visited the Oregon Capitol in February to make their case for allowing terminally ill Oregonians the right to try experimental drugs. When asked by a reporter what he would say to critics of the Oregon Right to Try bill, he looked up at her and said, “Wait until they find themselves in my situation, and then ask them.”

Buckstein concluded, “This truly bipartisan effort resulted in a bill that could literally mean the difference between life and death for some terminally ill Oregonians. I’m proud of the work Cascade Policy Institute did to promote the Right to Try concept and bill in Oregon, and look forward to Governor Brown signing the bill so it can take effect at the beginning of 2016.”

Cascade Policy Institute is a nonprofit, nonpartisan public policy research and educational organization that focuses on state and local issues in Oregon. Cascade’s mission is to develop and promote public policy alternatives that foster individual liberty, personal responsibility, and economic opportunity.

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Press Release – Statement on the Supreme Court’s King v. Burwell Decision

June 25, 2015

FOR IMMEDIATE RELEASE

Media Contact:

Steve Buckstein

503-242-0900

steven@cascadepolicy.org

Cascade Policy Institute Statement on Today’s Supreme Court King v. Burwell Decision: More Oregonians will lose rather than win

PORTLAND, Ore. – The U.S. Supreme Court decision today in the King v. Burwell case is a sad reminder that the President of the United States and his Administration can arbitrarily interpret laws passed by Congress to suit their own purposes.

In this case, the Affordable Care Act clearly states multiple times in its text that federal subsidies to offset insurance premiums can only be granted to individuals purchasing policies through an exchange “established by the state.” When most states failed to establish such exchanges, the IRS arbitrarily decided to grant subsidies to individuals who purchased insurance through the federal exchange, healthcare.gov, as well. By a six to three vote, the Court told us that the President and his Administration need not follow the language of the law because in the Court’s opinion that could cause harm to the intent of the law which was to make insurance more affordable.

How this decision will affect Oregon is fairly clear. Oregon originally set up its own state-established exchange, Cover Oregon. But when that $305 million project failed to sign up one person for insurance on its flawed website, the Cover Oregon board voted to scrap the exchange and migrate Oregonians over to the federal exchange, healthcare.gov. Board members didn’t seem to care how this decision might impact subsidies for Oregonians, and after the fact said they were relying on federal assurances that they considered this arrangement a “supported state based marketplace”—meaning that it would still qualify for subsidies even if the Court were to rule opposite of how it ruled today.

What is clear now is that today’s decision could actually harm more Americans, and more Oregonians, than it helps. According to a March 3rd press release by Michael Cannon of the Cato Institute and Cascade Policy Institute’s Steve Buckstein, “If subsides are denied under a King ruling, Oregon will join the majority of states in reaping benefits.” Now that the King ruling has found for the government, the Cato Institute believes that “approximately 157,000 [Oregon] individuals likely will continue to be subject to the law’s individual mandate requirement,” and 890,000 working Oregonians “also will continue to be subject to the employer mandates that are putting downward pressure on our economy.” These negative results stem from the ACA’s provisions that as long as subsidies make insurance somehow “affordable,” then the act’s mandates to purchase it remain in place.

Cascade Senior Policy Analyst Steve Buckstein says, “Today’s Court decision does not end the discussion about who should control your health care and who should decide what, if any, insurance you must purchase at what price; but it does push that discussion farther into the future. It unfortunately postpones our ability to move toward a more individual, patient-centered health care and health insurance world. Oregonians who watched their state government bungle an expansive insurance exchange project using other people’s money should be a big part of this discussion.”

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Looking at ObamaCare, Five Years On

By Sally C. Pipes

ObamaCare turned five years old March 23. But don’t break out the cake and candles. There’s not much to celebrate. When he signed his signature piece of legislation into law, President Obama guaranteed lower health costs, universal coverage, and higher-quality care. Five years later, the health law has failed to fulfill those promises.

“In the Obama administration,” candidate Obama boasted in 2008, “we’ll lower premiums by up to $2,500 for a typical family in a year.”

A recent report by HealthPocket, an online insurance marketplace, has revealed that premiums for individual Americans skyrocketed after ObamaCare became law.

Drug costs have jumped, too, despite promises to the contrary from the Obama administration. The majority of health plans offered on the exchanges have shifted costs for expensive medications onto patients, according to a study by Avalere Health. In 2015, more than 40 percent of all “silver” exchange plans―the most commonly purchased―charged patients 30 percent or more for specialty drugs. Only 27 percent of silver plans did so last year. Part of the problem is that the health law has quashed market competition.

The president promised in 2013 that “this law means more choice, more competition, lower costs for millions of Americans.” But that hasn’t turned out to be true. According to the Heritage Foundation, the number of insurers selling to individual consumers in the exchanges this year is 21.5 percent less than the number that were on the market in 2013―the year before the law took effect.

The Government Accountability Office reports that insurers have left the market in droves. In 2013, 1,232 carriers offered insurance coverage in the individual market. By 2015, that number had shrunk to 310.

With competition in the exchanges on the decline, quality is going down, too―just like President Obama said in 2013: “Without competition, the price of insurance goes up, and the quality goes down.”

Consumers who purchase insurance on the law’s exchanges have fewer options than they had pre-ObamaCare. The consulting firm McKinsey & Co. noted that roughly two-thirds of the hospital networks available on the exchanges were either “narrow” or “ultra-narrow.” That means that these insurance plans have refused to partner with at least 30 percent of the area’s hospitals. Other plans exclude more than 70 percent.

Patients may also have fewer doctors to pick from. More than 60 percent of doctors plan to retire earlier than anticipated―by 2016 or sooner, according to Deloitte. The Physicians Foundation reported in the fall that nearly half of all doctors―especially those with more experience―considered ObamaCare’s reforms a failure.

While more Americans may have insurance thanks to ObamaCare, they may not be able to find a doctor to see them. That’s a recipe for waiting lists and de facto rationed care.

Finally, five years on, President Obama’s declaration that he would not sign a plan that “adds one dime to our deficits―either now or in the future” looks more ridiculous than ever. In 2010, the Congressional Budget Office anticipated ObamaCare’s decade-long cost was $940 billion. This year, the CBO more than doubled that price tag, with a new estimate of $2 trillion.

The U.S. Supreme Court will rule this June on King v. Burwell, a case that threatens to negate the law’s subsidies. If the court rules against the administration, ObamaCare would unravel.

Obama has been proven wrong about what his health law would accomplish. Quality hasn’t improved, and costs continue to grow. That’s ObamaCare’s five-year legacy.


Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. A version of this article was originally published by The Orange County Register.

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Oregon Seniors Deserve Truth in Medicare Reform

By Steve Buckstein and Patrick M. Gleason

If Congress doesn’t act by the end of this month, when payment cuts to Medicare providers are scheduled to hit, there will be a major health care crisis. Topping the to-do list is addressing urgent problems with Medicare, the most costly federal program and the largest driver of national debt. Failure to act would have harsh ramifications for seniors and caregivers in Oregon.

The first step is to address accounting gimmicks that hide Medicare’s true cost and its effect on federal debt in the years ahead. The program operates under a phony spending baseline that conceals its true cost.

How did this come about? In 1997, Congress instituted a new spending formula, the Sustainable Growth Rate (SGR). It would institute physician reimbursement rate cuts in order to ensure that Medicare spending did not exceed the rate of economic growth. Noble goal, except that’s not what happened.

In 2003, the first time Medicare cuts were scheduled to take place under SGR, lawmakers balked and delayed the scheduled reduction in physician payments. In the 11 years since, Congress has delayed these scheduled payment cuts a whopping 17 times. This maneuver is referred to as the “doc fix.”

The Congressional Budget Office is forced to operate under the assumption that Congress will comply with SGR, even though the last 11 years have shown that to be pure fantasy. CBO treats passage of a doc fix as a spending increase. But it’s not, in reality, because Congress always passes a temporary reprieve. The worst kept secret on Capitol Hill is that Congress will always, just in the nick of time, pass a doc fix to prevent these payment reductions.

Underscoring this fact, for the first time ever, even Medicare’s own actuaries admitted last year that scheduled SGR payment cuts never would occur. The solution is to end this game, start being honest with ourselves, pass a permanent doc fix, and move on to reforms necessary to ensure the nation’s fiscal health and Medicare’s sustainability.

For Oregon, failure to pass a permanent doc fix would reduce seniors’ access to care. Oregon has 16 practicing physicians per 1,000 Medicare beneficiaries, which is below the national average. If Congress does not act, the result will be a 24 percent across-the-board pay cut for caregivers treating Medicare patients. With 46 percent of Oregon’s physicians over the age of 50, the age at which surveys show many physicians begin to consider cutting back on patient care, scheduled provider cuts would only exacerbate Oregon’s problems with access to care.

A temporary doc fix breeds corruption and legislative chicanery, producing a gold mine for lobbyists and political fundraisers. Worse, the constant need to pass an emergency, temporary doc fix distracts from much-needed Medicare reforms. If Congress continues to ignore the unsustainable trajectory of Medicare spending, the result will be harm to seniors and a federal budget drowning in red ink.

Fixing what’s wrong with Medicare is the top health and budgetary issue facing the country. As former Congressional Budget Director Doug Holtz-Eakin warns, “By 2020, as Baby Boomers continue to age into Medicare at the rate of more than 10,000 a day, Medicare’s cumulative $6.2 trillion in cash flow deficits will constitute 35 percent of the nation’s total debt accumulation.”

It’s time for members of Congress to stop kicking this can down the road, institute truth in accounting by passing a permanent doc fix, roll up their collective sleeves, and get to work on the real reforms that will save Medicare and put the nation on a sound fiscal path.


Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization. Patrick Gleason is director of state affairs at Americans for Tax Reform in Washington, D.C. The Bend Bulletin newspaper op-ed version of this commentary was originally published on March 25, 2015 here: www.bendbulletin.com/opinion/3004859-151/letter-oregonians-deserve-medicare-reform.

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Are ObamaCare’s Insurance Subsidies Legal?

Today the U.S. Supreme Court hears oral arguments in a case challenging the implementation of the Affordable Care Act (ACA). Plaintiffs in King v. Burwell claim the Internal Revenue Service (IRS) does not have the authority to circumvent the actual text of the ACA. According to the law, federal insurance premium subsidies can be allotted only if plans are purchased “through an Exchange established by the State.” When 36 states chose not to create their own exchanges, the IRS essentially rewrote this portion of the law to give subsidies anyway.

Oregon did set up a state exchange―Cover Oregon. But Cover Oregon never worked as planned; and now Oregon is contracting with the federal exchange, HealthCare.gov. The federal government and Oregon state officials claim this will guarantee Oregonians continued access to federal subsidies, but the King decision may not allow such subsidies to continue.

The King v. Burwell case could have a major impact on the future of ObamaCare. If the Court strikes down the IRS rule, the government would withhold subsidies for those living in states that chose to protect their citizens from the law’s employer mandate, the individual mandate, and the high costs of operating their own state-based exchanges. The Court’s decision could provide an important opportunity for states to reform health care in a meaningful way that respects taxpayers, provides for the truly needy, and addresses health care costs.

A ruling is expected by June 30.

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Event Video – The Man Who Could Bring Down Obamacare

On February 26, 2015 at a co-sponsored event presented by Cascade Policy Institute and Washington Policy Center, Michael Cannon, Director of Health Policy Studies at the Cato Institute, spoke before a packed house at the Multnomah Athletic Club in Portland, OR.

After the passage of the Affordable Care Act (ObamaCare), critics noticed that subsidies for health insurance purchases would be available only through “an Exchange established by the State,” such as the ill-fated Cover Oregon. The IRS actively ignored this part of the law and offered subsidies to those using the federal exchange, healthcare.gov, as well. Four legal challenges were filed to stop those illegal subsidies – and the illegal taxes they trigger. One of those challenges, King v. Burwell, goes before the U.S. Supreme Court on March 4, 2015 with a ruling expected by June 2015.

Michael F. Cannon is considered “ObamaCare’s single most relentless antagonist” and an “intellectual father” of the legal strategy that would expose how ObamaCare doesn’t work simply by requiring the Obama administration to follow the letter of the law. He will speak in Portland just six days before the U.S. Supreme Court hears oral arguments in King v. Burwell. “The man who could bring down ObamaCare” will discuss the case, what it means for Oregonians and Washingtonians, and how Congress should reform health care after ObamaCare.

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The Man Who Could Bring Down ObamaCare

Would you like to meet the man the media says could bring down ObamaCare? You’ll have that opportunity on Thursday evening, February 26, when Michael Cannon of the Cato Institute speaks in Portland.

Cannon is an architect of the legal strategy that could force the Obama Administration to follow the letter of its own Affordable Care Act and stop subsidizing insurance unless it is purchased through a state-established exchange. Cover Oregon was established by the state, but its website was so flawed that it couldn’t sign up a single person.

If Oregonians lose their subsidies because Cover Oregon failed, they will quickly find out just how unaffordable the Affordable Care Act really is.

To make this even more interesting, on the day Governor Kitzhaber resigned, the U.S. House Oversight Committee sent him a letter telling him not to destroy any documents that might shed light on the Cover Oregon fiasco.

And the U.S. Supreme Court will hear oral arguments in the case orchestrated by Michael Cannon on March 4.

Don’t miss your chance to meet The Man Who Could Bring Down ObamaCare on Thursday evening, February 26, in Portland.

For details and to RSVP, call Cascade Policy Institute at 503-242-0900, or visit cascadepolicy.org.

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Right to Try Is Right for Oregon: Let terminally ill patients try to save their own lives

If you or someone in your family had a terminal illness, would you want the right to try an experimental drug that might save a life? That’s what eleven-year-old Diego Morris of Phoenix wanted when he was diagnosed with a rare, deadly form of cancer. Traditional treatment didn’t work; and after an exhaustive search, his family found a “miracle drug” that was approved in much of the world but not in the United States. So, the whole family moved to England where Diego was successfully treated. Now back in Phoenix, Diego has been cancer-free for two years.

Now thirteen years old, Diego Morris was the Honorary Chairman of the campaign that saw 78 percent of Arizona voters approve a Right to Try referendum last November. It will give terminally ill patients the right to try to save their lives by allowing access to investigational medicines that have not yet been approved by the U.S. Food and Drug Administration (FDA). Diego supported the measure because he said “…hope was the most important thing to him and giving hope to others is what he thinks the right to try law will do.”

Oregon legislators are now being asked to approve Right to Try legislation here. HB 2300 in the House Health Care Committee would not compel physicians or drug companies to provide any treatment; it would simply allow terminally ill patients the right to try to get access to drugs or devices not yet approved by the FDA.

In addition to Arizona, Right to Try laws have been enacted overwhelmingly within the last year by legislatures in Colorado, Louisiana, Missouri, and Michigan. Legislatures in more than twenty states are now being asked to give their citizens this important right.

Designed by the Goldwater Institute in Arizona, the Right to Try concept addresses a growing dissatisfaction with the slow process of approving life-saving medications in America. Creating, developing, testing, and getting government approval to market a new drug here can take upwards of ten years and cost more than one billion dollars. While this process may keep unsafe or ineffective drugs off the market, it may also keep effective drugs away from critically ill patients for so long that they literally die waiting.

Only about three percent of the sickest Americans qualify for or have access to FDA-approved clinical drug trials, and even those who enter such trials cannot be sure whether they are receiving a potentially useful drug or a placebo. Some medical researchers worry that granting terminally ill patients the right to try investigational medicines may make it harder to recruit people for randomized controlled trials. However, more and more people now recognize that an individual’s right to try to save their own life should trump the need that researchers might have to control how those drugs are tested.

As Goldwater Institute president Darcy Olsen says, “Terminal patients shouldn’t have to ask the government for permission to try to save their own lives.”

While the FDA does allows people to request access to medicines that have not yet been approved, the process can require 100 hours of paperwork and months to complete, with no assurance that access will be granted. Currently, fewer than 1,000 individuals get such approval annually. Right to Try offers a better way.

Some legal scholars worry that the federal government will challenge state Right to Try laws under the Supremacy Clause of the U.S. Constitution, which says that when federal and state laws conflict it is federal law that should take precedence. While this is often the case, Oregon is in the forefront of what could be a very relevant exception.

Oregon voters twice approved the state’s controversial Death With Dignity Act, in 1994 and again in 1997. The law allows “terminally-ill Oregonians to end their lives through the voluntary self-administration of lethal medications, expressly prescribed by a physician for that purpose.” The medications, however, are deemed controlled substances by the FDA and not federally approved for such a purpose.

The U.S. Attorney General argued that because federal law prohibited controlled substances from being used to intentionally end life, the Courts should strike down the Oregon law. The U.S. Supreme Court disagreed. In Gonzales v. Oregon (2006), the Court upheld Oregon’s law. It found that states generally have wide discretion in regulating health and safety, including medical standards. Finding that the Bush Administration’s reading of the federal statute would mark “a radical shift of authority from the States to the Federal Government to define general standards of medical practice in every locality,” the Court ruled that Oregon could protect the rights of its citizens, at least in this specific instance.

If Oregon can protect the right of its citizens to end their own lives with controlled substances, it should be able to protect the right of its citizens to try to save their own lives with substances not yet approved by the federal government.

As thirteen-year-old cancer survivor Diego Morris believes, Right to Try can offer hope to people facing life-ending situations when federal law offers no hope. It’s a policy whose time has come, and Oregonians deserve.

Right to Try is right for Oregon.

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Arizonans Gain the “Right to Try” to Save Their Lives

Amid last week’s election excitement, Arizonans overwhelmingly approved their “Right to Try” referendum, allowing terminally ill patients access to experimental drugs that have completed basic FDA safety testing but are still awaiting further approval. With seventy-eight percent of the vote, Arizona becomes the fifth state to pass Right to Try legislation this year. Momentum is building with wide bipartisan support. Is there any reason for opposition?

Opponents worry that Right to Try may harm the drug development process by pushing patients away from clinical trials. One way to deal with this concern is the Colorado approach, which requires patients be ineligible for trials in order to participate in Right to Try.

More troubling, critics fear that Right to Try takes advantage of vulnerable patients. They worry the terminally ill may choose options that are not in their best interest and that may ultimately lead to an early death.

Right to Try isn’t a magic bullet, though. It doesn’t guarantee a cure, nor is it free from risk. What it offers is a choice when all other options have failed. Oregon already offers terminally ill patients the choice to end their lives under the Death with Dignity Act. If you can choose to die, shouldn’t you be able to choose to fight to live?

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Will the Supreme Court’s Ruling on Subsidies Be ObamaCare’s Downfall?

By Sally C. Pipes

The battle over ObamaCare has shifted to the courts. This time, the president is on the defensive. Last month, a three-judge panel of the U.S. Court of Appeals for the D.C. Circuit ruled 2-1 in Halbig v. Burwell that the federal government lacks the authority to provide subsidies to offset the cost of health insurance to folks shopping for coverage on HealthCare.gov, the federally run exchange. The federal government has since asked the full Circuit Court to hear the case.

The same day that the D.C. Circuit panel issued its ruling, the Court of Appeals for the Fourth Circuit, based in Richmond, Virginia, arrived at the opposite conclusion in a similar case, King v. Burwell, and upheld the federal subsidies as legal. The disagreement practically begs the U.S. Supreme Court to weigh in. The plaintiffs in King v. Burwell have petitioned the U.S. Supreme Court for cert. If granted, the case will go to the high court. It’s unlikely that the high court will hand down a decision until spring or fall 2015.

The D.C. Circuit panel has the law on its side. Should the Supremes agree with them, then ObamaCare could quickly unravel. And if it does, Congress should be ready with a replacement health care reform plan that empowers doctors and patients, not the federal government.

The Affordable Care Act’s text is unambiguous about how the insurance exchanges are supposed to work. According to the law, federal subsidies are available through exchanges “established by the State.” Thirty-six states didn’t set up exchanges. In some cases, their elected leaders decided not to. Other states tried to build their own. In many cases—among them Oregon, Maryland, Vermont, and Hawaii―they failed.

The law provided that the federal government would step in if the states did not. As a result, the federal government has found itself running an exchange that serves more than two-thirds of the states. And it’s decided, based on the counsel of the legal eagles at the IRS, to ignore those four words— “established by the State”—in order to dole out subsidies.

Even as it sided with the federal government, the Fourth Circuit observed, “If Congress did in fact intend to make the tax credits available to consumers on both state and federal Exchanges, it would have been easy to write in broader language, as it did in other places in the statute.” The court, which ruled for the government, went on to say that it “cannot ignore the common-sense appeal of the plaintiffs’ argument; a literal reading of the statute undoubtedly accords more closely with their position.”

ObamaCare’s supporters argue that “congressional intent” justifies direct federal subsidies. But they’ll have a tough time proving that before the Supreme Court. An early version of the health care reform bill did include an explicit authorization to distribute subsidies through a federal exchange. But it was absent from the final version.

That’s a problem for the Obama Administration, as U.S. Supreme Court precedent holds “that Congress does not intend sub silentio to enact statutory language that was earlier discarded in favor of other language.” Or as another Supreme Court decision put it, “the starting point for interpreting a statute is the language of the statute itself. Absent a clearly expressed legislative intention to the contrary, that language must ordinarily be regarded as conclusive.”

If the Supremes forbid the Obama Administration from distributing subsidies through the federal exchange, the law will crumble. That’s because many, if not most, exchange shoppers will be unable to afford policies without subsidies. As more and more people go without insurance, the exchange pool will skew sicker and premiums will head higher.

Already, average monthly premiums for a mid-level silver plan are $324. They’ll rise 8 percent next year, according to Avalere, a consulting firm. Eighty-seven percent of the people in the 36 states that rely on the federal exchange are receiving subsidies. Without those subsidies, premiums for some 5 million people will spike dramatically. The disappearance of subsidies would also destroy the employer mandate, which requires employers with more than 50 full-time workers to provide insurance coverage.

Fortunately, there are other ways to expand access to affordable insurance. Subsidizing insurance does little to encourage insurers to rein in premiums. In fact, if distributed as a percentage of premiums, subsidies can reward them for hiking prices. Expanding competition among insurers, by contrast, can make insurance more affordable and drive down costs. Creating a truly national marketplace—where Americans could purchase health insurance across state lines—would do just that. There’s no reason insurance should cost 2.5 times more in Rhode Island than in Alabama.

Allowing individuals to purchase health insurance tax-free—just as those who have employer-sponsored insurance through their work can—would also make coverage more affordable. Most Americans get health insurance through their place of work. So they have little incentive to consume care judiciously. After all, they’re not paying the bill. Increased usage of the health care system leads to higher overall premiums.

Two years ago, ObamaCare’s individual mandate survived before the U.S. Supreme Court. The law’s exchange subsidies may not be so lucky.

Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. A version of this article was originally published by Forbes.

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Oregon’s Prescription-Only Cold Medicine Law Needs a New Look

In recent years, Cascade Policy Institute has tracked and analyzed the effectiveness of a 2006 Oregon state law that requires all citizens to obtain a doctor’s prescription before buying pseudoephedrine-based cold and allergy medication.

Overall, our analysis found that the law produced a minimal impact on the state’s methamphetamine problem, based on the fact that not only did Oregon see a significant decline in meth lab incidents prior to the law’s passage, but that Oregon’s neighboring states experienced a similar decline in meth labs over the same time period without enacting such a prescription law.

Since Cascade published our study in 2012, Oregon’s meth problem has shown no signs of improvement.

Last month, Oregon’s High Intensity Drug Trafficking Area (HIDTA) program released its 2015 Program Year “Threat Assessment and Counter-Drug Strategy.” Within the report, a number of new data points and law enforcement survey findings cast fresh doubts on the 2006 law. Among the most troubling findings:

  • While the number of meth lab seizures remains low, volume confiscated in Oregon has grown dramatically since 2007. Ninety percent of law enforcement officials indicate crystal meth was highly available in their area.
  • Meth-related arrests in Oregon nearly doubled from 2009 to 2014.
  • According to Oregon law enforcement officials, meth is the drug that contributes most to violent crime and property crime and is the primary funding source for major criminal activity.
  • According to the Oregon State Medical Examiner Division, the number of fatalities related to meth use rose to a historic high of 123 deaths in 2013, over twice the number of fatalities in 2001.

By any reasonable measure, the 2006 law has failed in spectacular fashion. The newly released 2015 HIDTA report should compel Oregon policymakers to reexamine the law and look for anti-meth measures that actually will lead to progress in the fight against meth.

Oregon’s pseudoephedrine prescription requirement law is poor policy because it fails to address the fundamental causes of meth crime. Clearly, Oregon’s meth users and dealers have been able to bypass the prescription requirement in the same manner criminals have done so relative to prescription medicines, despite strict controls on those products. Meanwhile, law-abiding Oregonians live in one of two states in the entire country that prohibit over-the-counter purchases of popular and effective pseudoephedrine-based cold and allergy medicines. Those products offer powerful relief that allows patients in other states to avoid the costly hassle of making a doctor’s appointment and asking for a prescription.

It doesn’t have to be this way.

A number of other states, including Oklahoma, Alabama, and Kentucky, have experienced drastic success against meth criminals due to targeted legislative solutions that penalize criminals, not consumers. Each of those states employs an electronic pseudoephedrine tracking system that automatically blocks illegal pseudoephedrine purchases and provides law enforcement with critical evidence that leads to meth busts and arrests. Oklahoma, for instance, uses a meth-offender block list, which prohibits certain drug offenders from being able to buy pseudoephedrine products. Since 2012, the state has seen a decline in meth-lab incidents of more than 50 percent.

Oregon’s law enforcement officers regularly put their lives on the line to make our communities safer. Given what is at stake, elected officials have a responsibility to debate and pass legislation that fixes problems and improves the quality of life for the people they serve. Equally important, however, is the responsibility to make changes to laws that have failed to deliver results, especially when those laws inconvenience law-abiding consumers without solving crime-related problems.

It’s time to take a look at the prescription requirement law. The stakes are too high not to.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

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U.S. Has the Worst Health Care? Not by a Long Shot

By Sally C. Pipes

Few complaints about the U.S. health care system are as common as the claim that we spend too much on health care and get too little for all that spending in return—especially compared to other industrialized nations.

A new Commonwealth Fund report is the latest to indict U.S. health care. It pegs the American system dead last in a survey of 11 developed countries. But like virtually every other study that trashes the U.S. health care system, Commonwealth’s rankings rely on questionable assumptions, like giving weight to those systems that treat people equally rather than well. At the same time, Commonwealth ignores the problems that countries with socialized health care systems have actually treating people once they’re sick. And on that metric—that is, actually delivering care to those who need it—the United States is without peer.

The Commonwealth Fund report begins by asserting that the U.S. health care system “is the most expensive in the world.” It’s true that the United States spends a larger share of its Gross Domestic Product—17.9 percent, or almost $3 trillion—on health care than other countries. But by itself, that statistic means nothing.

The United States also happens to be one of the richest countries in the world. Once basic needs are taken care of, an increasing share of each extra dollar will go to what were once considered luxuries. That’s borne out by national spending data. Between 1990 and 2012, for example, spending on health care climbed 290 percent, significantly faster than overall GDP growth of 171 percent.

But household spending on live entertainment went up more than 500 percent over those same years, while spending on pets climbed 353 percent. By the Commonwealth Fund’s logic, America also faces a pet-care spending crisis. In contrast, spending on staples like food, clothing, housing, and furnishings climbed more slowly than overall GDP.

The Commonwealth Fund concludes that the United States “underperforms relative to most other countries on most other dimensions of performance” despite having the most expensive health care system in the world. But a closer look at those “dimensions” calls that claim into question.

Take infant mortality rates, where the United States typically places far down the list behind France, Greece, Italy, Hungary, even Cuba.  This comparison is notoriously unreliable, because countries either use different definitions of a live birth—or fudge their numbers. The United States, for example, counts every live birth in its infant mortality statistics. But France only includes babies born after 22 weeks of gestation. In Poland, a baby has to weigh more than 1 pound, 2 ounces to count as a live birth. The World Health Organization notes that it’s common practice in several countries, including Belgium, France, and Spain, “to register as live births only those infants who survived for a specified period beyond birth.”

What’s more, the United States has significantly more pre-term births than other countries. That fact alone accounts for “much of the high infant mortality rate in the U.S.,” according to a report from the Centers for Disease Control and Prevention (CDC). The CDC found that if the United States had the same pre-term birth rate as Sweden, our infant mortality rate would be cut nearly in half.

What about life expectancy, where the United States ranks below its peers as well? International measures of longevity typically fail to account for differences in obesity, accidental deaths, car accidents, murders, and the like, all of which shorten lives no matter how good a nation’s health care system is. The U.S. murder rate, for example, is far higher than all the other countries in the Commonwealth Fund study. The United States has a worse highway death rate than all but one of them. And U.S. obesity rates are more than double Canada’s and more than four times Switzerland’s.

A far more meaningful comparison of international health systems would take stock of how people afflicted with diseases such as cancer fare in different countries. And on this measure, there’s no question the United States stands above the rest. Five-year survival rates for breast cancer are higher in the United States than England, Denmark, Germany, and Spain, according to the American Cancer Society. In the United States, the survival rate for prostate cancer is 99.1 percent. In Denmark it’s 47.7 percent. For kidney cancer patients, the survival rate here is 68.4 percent. It’s just 45.6 percent in England—which the Commonwealth Fund ranked as the number-one health care system in the world.

Finally, the Commonwealth Fund study also ignores massive problems with actual access to care in the countries it heralds. Every citizen of a country with socialized medicine may have insurance. But that doesn’t mean they can get the care they need.

Treatment delays were so chronic in the United Kingdom, for example, that the government had to issue a formal requirement that patients shouldn’t have to wait more than four months for treatments authorized by their general practitioner. The Royal College of Physicians found that poor care—including doctors trying to keep costs down—caused nearly two-thirds of asthma deaths in the U.K. in 2012.

In Canada, the average patient seeking an elective medical service has to wait four-and-a-half months between being recommended for treatment by their primary care physician and actually receiving it. Waiting for care is the norm in Canada, even though Madam Chief Justice Beverley McLachlin of the Canadian Supreme Court declared nine years ago, in a ruling holding a ban on private health insurance in Quebec illegal, “Access to a waiting list is not access to health care.”

The Commonwealth Fund is right about one thing—the U.S. health care system is too expensive. But rationing care—as Commonwealth’s favored systems do—is not the answer. Oregonians should pay special heed to this warning since your “Bold Experiment That Failed,” the Oregon Health Plan rationing scheme, is still seen by many as a model for all of you.

Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. A version of this article was originally published by Forbes.

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What Should Have Happened with Cover Oregon

By now, people around the country know our state’s attempt to create a health insurance exchange website was a colossal failure. Fingers of blame are pointing in all different directions; and last month the U.S. Attorney’s office issued broad subpoenas seeking information from Cover Oregon and the Oregon Health Authority about who did what, who knew what, and when.

On May 29 Governor John Kitzhaber spoke at a legislative committee hearing to announce that he blamed the prime website contractor, Oracle Corporation, for failing to deliver a working website. He asked Oregon’s Attorney General to consider suing Oracle to “get our money back.” Of course, the money he’s talking about isn’t really “our money” because we got it from the federal government. And, that same federal government is considering whether to ask Oregon for “its money” back as well.

Later in that same hearing, Oregon’s new Chief Information Officer made an interesting observation.* Alex Pettit wasn’t here when Cover Oregon began its long march toward failure in 2011. Legislators asked him if anything would have been different if he had been overseeing Oregon’s IT projects back when the ObamaCare state exchanges were being born.

Mr. Pettit discussed how he viewed such big IT projects, how he evaluated them, and how he decided if they should proceed or not. He noted that, as Governor Kitzhaber and others have admitted, Cover Oregon was a very ambitious project with a very broad scope. Pettit said that to be successful, such projects must instead have a narrow scope.

He explained that since he came to Oregon in January, he has acted to slow down other big projects until they met his criteria, even though they might be priorities of the Governor as Cover Oregon was. He then explained that in 2011 he was the Chief Information Officer in the state of Oklahoma when it applied for and received a $134 million federal grant to build that state’s health insurance exchange.

Pettit noted that his team evaluated the proposal for the Oklahoma exchange and they decided that “We did not have the capacity to do this.” And so, as he told Oregon legislators, they “sent the money back.”

If Oregon officials had made a similar decision in 2011, we wouldn’t be where we are today, having spent some quarter billion tax dollars on a project that caused nearly everyone involved nothing but grief and heartache. In the future, let’s hope that we follow Mr. Pettit’s advice when he or his successors determine that we should simply “send the money back” or, better yet, not ask for it in the first place.


 

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

* Audio of the entire Joint Committee On Legislative Audits, Information Management and Technology (5-29-14) hearing is here:http://www.leg.state.or.us/listn/archive/archive.2013i/JLAIMT-201405291400.ram

The questions leading to Mr. Pettit’s answer about what happened in Oklahoma begin at about 1:48, and his answers run to about 1:55.

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How Jefferson Explained the Constitution to Louisiana Nuns

This week in 1804, Thomas Jefferson wrote to an Ursuline nun in New Orleans, who had asked him to clarify her religious community’s rights under U.S. law after the Louisiana Purchase. President Jefferson assured her that the American government would never interfere with the nuns’ property, ministries, or way of life.

 

Jefferson wrote, “The principles of the constitution and government of the United States are a guarantee to you that it will be preserved to you, sacred and inviolate, and that your institution will be permitted to govern itself according to its own voluntary rules, without interference from the civil authority.”

 

Two hundred ten years after Jefferson wrote that letter, a community of sisters who care for the elderly is defending in court their right to carry out their ministries in accordance with their faith. Under current federal regulations, the Little Sisters of the Poor don’t qualify for a religious exemption from the ObamaCare insurance mandate which requires most employers to provide contraception and abortion coverage.

 

Like the Ursuline nuns of Jefferson’s time, Catholic sisters today should not lose their religious freedom while working in their own ministries. We can imagine what Jefferson might think of American women having to sue the government to defend their First Amendment rights. But can we doubt he would be dismayed by how intrusive and coercive the federal government has become since the day he explained the safeguards of the American Constitution to a group of French nuns?

Kathryn Hickok is Publications Director and Director of the Children’s Scholarship Fund-Portland program at Cascade Policy Institute.

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ObamaCare Inflates Enrollment—And Premiums

By Sally C. Pipes

HealthCare.gov has officially closed and, despite months of technical hiccups, enrollment appears to have finished strong.

The Obama Administration estimates that 8 million people have signed up for coverage through the marketplaces. The president cited the figure as proof that “this law has made our health care system a lot better.”

Hardly. His enrollment numbers are artificially inflated. And the real rate of coverage may decline even further once consumers find out how much they’ll have to pay for insurance thanks to ObamaCare.

For starters, the administration’s 8 million enrollees include everyone who picked a plan—not just those who have actually paid for their coverage.

Insurers are reporting that 15% to 20% of those who have signed up haven’t paid their first premium. In other words, about 1.5 million people that the Administration counts as “enrolled” may still be uninsured.

Just because a consumer pays his first premium doesn’t mean he’ll make his second payment.

Insurance industry consultant Bob Laszewski has reported that 2% to 5% of enrollees haven’t paid their second month’s premium. If that sort of attrition continues, thousands of “enrollees” could end up uninsured before summer.

Further, many of ObamaCare’s 8 million enrollees previously had insurance—they just swapped out their existing policies for ones issued through the exchanges.

A recent RAND Corp. survey found that only one-third of exchange enrollees were previously uninsured.

The Congressional Budget Office reports that ObamaCare will spend $17 billion on exchange subsidies this year. A big chunk of that money will no doubt go to the two-thirds of exchange customers who previously secured coverage on their own.

Not exactly the wisest stewardship of taxpayer dollars.

Meanwhile, about a million of the 5 million people whose policies were canceled because they did not meet ObamaCare’s new rules remain uninsured.

The demographic composition of the exchange population also presents a problem.

Because the law forbids insurance companies from charging the old and sick more than three times what they charge the young and healthy, insurers must attract enough young, low-cost people to keep premiums down.

That hasn’t happened. Just 28% are between the ages of 18 and 34—well below the 40% the Administration said would be needed to keep ObamaCare’s exchange pools financially stable. It’s already clear that the exchange population is sicker than average.

According to a report from pharmacy benefit manager Express Scripts, exchange enrollees use 47% more specialty medications than the general insured population.

Demand for HIV meds is four times higher in the ObamaCare pool than in the existing commercial pool. Anti-seizure medication prescription rates are 27% higher.

Those drugs are more expensive. As Express Scripts puts it, “Increased volume for higher cost specialty drugs can have a significant impact on the cost burden for both plan sponsors and patients.”

Insurers will adjust to this reality by raising premiums. WellPoint predicts “double-digit-plus” rate increases across the country. In some areas premiums could go up 100%.

Cigna CEO David Cordani says his company has already brought up the coming “rate shock” with the Administration—and is pushing for changes to mitigate it.

ObamaCare’s exchanges appear to have survived their first enrollment period. But the government health-insurance platforms are far less healthy than the administration claims—and may crumble when they next open for business this fall.

Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. A version of this article was originally published by Investors Business Daily.

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Cover Oregon: Out of the Frying Pan

 

*This event is currently sold out. You can add your name to the waiting list by clicking the “Add to Waitlist” link in the Eventbrite registration box below.

 

Please join us for Cascade’s monthly Policy Picnic led by Cascade Policy Institute founder and senior policy analyst Steve Buckstein on Wednesday, May 21st, at noon.

Cover Oregon’s board has admitted its $200 million plus website failure, but the decision to move Oregonians to the healthcare.gov website could backfire big-time. Not only might the board not have the authority to pull the plug on Oregon’s health care exchange, but a federal court case threatens to deny Oregonians the tax credits that ObamaCare promised would make our insurance premiums “affordable.”  What else could go wrong?

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.

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Cover Oregon: Out of the Frying Pan…

On April 25th, after wasting more than $200 million in federal cash, Cover Oregon’s Board voted to pull the plug on Oregon’s failed ObamaCare health insurance exchange and go with the federal exchange technology as the “core” of its system. The first open enrollment period for Oregonians ends today. Oregon hopes to be back in business using the federal technology when the next enrollment period opens up on November 15.

The only problem is that―as I testified before the Board―the Affordable Care Act states some nine times that only individuals signing up through “state established exchanges” qualify for federal tax credits to make their insurance premiums more “affordable.” Those using the federal exchange aren’t eligible for these credits, although the Obama Administration has ignored the clear wording of the law and granted them anyway.

On March 25 the Federal D.C. Circuit Court of Appeals heard arguments on this in the Halbig v. Sebelius case. One judge seemed to telegraph how he might rule by stating, “There is an absurdity principle, but there is not a stupidity principle. If the law is just stupid, I don’t think it’s up to the court to save it.”

If the courts eventually rule against granting tax credits to those using the federal exchange, Cover Oregon’s Board may have just pushed many Oregonians out of the frying pan and into the fire.

Steve Buckstein is founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Four Years of ObamaCare Failures Is Long Enough

By Sally C. Pipes

President Obama marked the fourth anniversary of the passage of ObamaCare this week by promising to spend the next year “working to implement and improve on it.” He has his work cut out for him. Four years on, the Affordable Care Act has failed to deliver what its name formally promised—and is shaping up to be decidedly unaffordable for taxpayers. Consumers ought to hope that ObamaCare doesn’t make it to the age of five—and that lawmakers enshrine market-friendly, patient-centered reforms in its place.

Four years after passage—and six months after they were supposed to be fully operational—ObamaCare’s insurance exchanges are still malfunctioning. Last week, just days before the end of the open-enrollment period, the Philadelphia Inquirer discovered that the federal exchange website, HealthCare.gov, was displaying incorrect information about the subsidies for which shoppers should qualify.

The trillion dollars the Administration has earmarked for subsidies won’t make insurance more affordable if consumers can’t actually claim them. Online insurance marketplace eHealthInsurance estimated last week that ObamaCare had pushed premiums in the individual market up by as much as 59 percent this year, thanks to its myriad and costly new benefit mandates, taxes, and fees. Industry officials now say that rates could double in many areas of the country next year.

With the cost of coverage skyrocketing, it’s no wonder that enrollment has lagged the Obama Administration’s goals. One-fifth of those whom the Administration has counted as “enrolled” don’t appear to have paid their premiums. So they don’t actually have coverage.

Further, despite millions of dollars in advertisements, endless stumping by the president, and promotion by the likes of NBA stars Kobe Bryant and LeBron James, the exchanges have failed to attract anywhere near enough young people. Without sufficient premium income from these young, largely healthy individuals, the marketplaces will not be able to shoulder the costs associated with treating older, less healthy folks. Officials originally estimated that 40 percent of enrollees would need to be between the ages of 18 and 34 for the exchanges to be solvent. Thus far, this coveted demographic has accounted for just 25 percent of enrollment. If the exchanges flop, taxpayers could be forced to bail them out.

Small businesses that had been promised repeatedly by Obama that they’d save money learned in late February that two-thirds of them would see their premiums climb because of the law.

ObamaCare is even failing to expand coverage to the uninsured. A McKinsey study found that only a fraction of those who enrolled in the exchanges had previously been uninsured. The same study found that half of those who did not enroll pointed to “affordability”—or a lack thereof—as their main reason for choosing not to purchase coverage.

With the exchanges foundering and several directors of state exchanges resigning (The Oregonian dubbed Cover Oregon’s leadership changes “a major managerial house-cleaning”), the Administration has taken to rewriting the law to try to avoid open revolt. The over 5 million consumers whose plans were previously canceled because they didn’t meet ObamaCare’s stringent benefit requirements can now keep them through 2017, three years longer than the law originally prescribed. The Administration has also given people whose plans were canceled a “hardship exemption” so that they can dodge the individual mandate through 2016.

Many of those who have chosen to buy ObamaCare-approved coverage have been outraged to find that their policies permit them to visit only a handful of doctors and hospitals. So much for the President’s oft-repeated promise, “If you like your plan, you can keep it.” The Administration has responded by forcing plans to expand their provider lists in 2015. That decision may only hike rates further come next year. And recent media stories have been confirming as much.

By tweaking the law on the fly, the Administration is punting its problems down the road. Industry officials specifically point to the Administration’s various delays and changes as the main culprit for rate hikes. One insurance company representative told The Hill that his firm’s rates would triple on the exchange next year.

It doesn’t have to be this way. We can expand access to coverage for those with preexisting conditions, reduce costs, and lower the uninsured rate without disrupting Americans’ coverage and increasing their premiums. The president chose to cover those with pre-existing conditions in the most expensive way possible—by requiring insurers to offer policies to all comers and forbidding them from charging anyone more than three times what they charged anyone else. So insurers just hiked rates for everyone.

A more cost-effective way to minister to those with pre-existing conditions is by expanding federal funding for state-level high-risk pools. Many such pools were functioning well before ObamaCare, furnishing coverage to those who couldn’t get it on the open market without jacking up premiums for the rest of the population.

Meanwhile, the chief obstacle to covering the uninsured is affordability. Market forces could break that barrier down. Letting consumers buy across state lines, for instance, would increase competition among insurers and encourage state regulators to limit unnecessarily costly benefit mandates. Expanding health savings accounts (HSAs), where people can save money pre-tax for health care services, would give patients control over their health care dollars and encourage them to spend wisely. The explosive growth of HSAs in the employer market is one reason that health costs have been growing more slowly than the historical average in recent years.

Another way to make health insurance more affordable? Allow individuals to purchase coverage with pre-tax dollars, just as businesses can. Such a move would grant consumers the opportunity to choose coverage that suits their needs and budget—not their employer’s. And to ensure that low-income individuals could take advantage, the government could offer a refundable tax credit toward the purchase of health insurance.

As ObamaCare turns four, a clear majority of Americans stands opposed to it. Here’s to hoping that this anniversary is among the law’s last.

Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. A version of this article was originally published by Forbes.

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As ObamaCare Turns Four, How’s It Working out for You?

The Affordable Care Act turned four years old last Sunday. So how’s it working out for you? If you’re one of the millions who lost, or risk losing, the insurance you already had, your answer is probably “not so great.”

If you’re a young person who realizes that ObamaCare wants you to pay much higher insurance premiums to subsidize older and sicker Americans, your answer is probably “not so great” also.

Not even considering the HealthCare.gov website disaster, and the totally dysfunctional Cover Oregon website debacle, it appears there may be more people losing their health insurance coverage than have gained new coverage under this deeply flawed law.

The Congressional Budget Office estimates that the law will cause the equivalent of two million jobs to be lost by 2017.

The 2013 PolitiFact Lie of the Year was President Obama’s oft told fib that “If you like your health care plan you can keep it.”

When the first ObamaCare open enrollment period ends on March 31, its flaws will be hard to gloss over. Rather than carve out even more exemptions to the law, the administration should admit that they got it wrong. Then we can have an honest discussion about how to move toward real insurance reform using market principles that offer true affordable alternatives to the Affordable Care Act, which has proven anything but.

Steve Buckstein is founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

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As the Affordable Care Act Turns Four, Cascade’s Predictions Were on the Mark

Sunday, March 23, was the fourth anniversary of the passage of the Patient Protection and Affordable Care Act (“ObamaCare”). Cascade founder and senior policy analyst Steve Buckstein predicted then that ObamaCare would “represent much more a violation of individual liberty than an improvement in American health care.”

Four years later, the law remains mired in controversy, confusion, and dysfunction. The ACA has been challenged from numerous constitutional, philosophical, and moral angles; and the Supreme Court will hear a case this week challenging the ACA on First Amendment grounds.

Buckstein wrote in 2010:

When we founded Cascade Policy Institute in 1991, our mission was, and still is, to promote public policy alternatives that foster individual liberty, personal responsibility and economic opportunity. This bill threatens to set us back in all three areas:

Individual liberty will be violated as the federal government takes away even more of our options regarding what insurance, if any, we choose to purchase and how we purchase it.

Personal responsibility will be decimated as the federal government tells us “don’t worry about taking care of yourself; we’ll do that collectively from now on.”

Economic opportunity will be stifled as the tax burden on individual workers, employers and investors go up, not down. Without meaningful cost controls, health care costs will spiral, leading to higher federal deficits and to even more government involvement in the economy.

When the bill’s supporters tell us that every other industrialized country has national health insurance, our response should be, “America is not every country; America is supposed to be the land of the free.”

We now see that most of these predictions are coming all too true. Not even considering the HealthCare.gov website disaster, and the totally dysfunctional Cover Oregon website debacle, it appears that more people may be losing their health insurance coverage than have gained new coverage under this deeply flawed law. The Congressional Budget Office now estimates the law will cause the equivalent of two million jobs to be lost by 2017. The 2013 PolitiFact Lie of the Year was President Obama’s oft-told fib, “If you like your health care plan you can keep it.” Only a fraction of those who have signed up under ObamaCare exchanges are the “young and healthy” the scheme needs to pay higher premiums to subsidize the “old and sick.” It seems that younger people would vote for Obama, but they won’t follow him off a health care cost spiral cliff.

With the first ObamaCare open enrollment period ending on March 31, its flaws will certainly be hard to gloss over.* Rather than carve out even more exemptions to the law, the administration should admit that they got it wrong. Then we can have an honest discussion about how to move toward real insurance reform using market principles that offer true affordable alternatives to the Affordable Care Act, which has proven anything but.

* The administration is now expected on March 26th to announce an extension of the March 31st open enrollment deadline for certain individuals.

 

 

 

 

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In Oregon and Nationally, ObamaCare’s Exchanges Don’t Play Well with the Young

By Sally C. Pipes

Young people appear to have abandoned President Obama less than two years after sending him back to the White House. Only 41 percent of Americans 18 to 29 approve of his job performance, according to a recent poll from Harvard’s Institute of Politics.

Even more—56 percent—disapprove of ObamaCare, his chief domestic policy achievement. Many of these “young invincibles”—folks between the ages of 18 and 34―are expressing their disapproval by refusing to enroll in the law’s health insurance exchanges. If this trend keeps up, the exchanges could collapse.

The Congressional Budget Office (CBO) estimates that 40 percent of enrollees must be young and healthy for the exchanges’ finances to work. Here’s the logic behind that conclusion. Young people, while not quite invincible, are far less likely to get sick—and thus to use their coverage. So many will pay premiums without claiming much in benefits in return. Those premiums are supposed to go toward subsidizing the cost of coverage for older, sicker adults.

It doesn’t look like exchange enrollment will meet the administration’s target. Colorado just reported that a scant 7 percent of its exchange enrollees are between 18 and 24. More than four times as many are between the ages of 55 and 64. Sixteen percent are between 25 and 34.

Despite Cover Oregon’s $21-million, youth-friendly marketing campaign, Oregon is tied with West Virginia for last place in young sign-ups. As of March, Oregon remains the only state with an exchange in which people can’t self-enroll online in one sitting, and the manual application backup process may further discourage young adult enrollment.

Nationwide, as of late February, about 27 percent of the four million people who have signed up for coverage through the marketplaces are young adults. That’s only a slight improvement over January, when 24 percent of enrollees were young.

At the outset, the Obama Administration estimated that 1.6 million of enrollees in February would be young people. Their guess was a bit off—just over 800,000 had signed up by the beginning of the month. According to the New York Times, the Obama Administration hasn’t been able to translate the “get-out-the-vote” prowess it displayed in the 2008 and 2012 presidential elections into the health insurance realm. Only 9 percent of those who have purchased policies are aged 18 to 25. The 26 to 34 band accounts for 16 percent of enrollees.

And the situation isn’t likely to improve. A study from NerdWallet, a personal finance website, predicts that young adults who opt for the financial penalty associated with remaining uninsured, which goes into effect on April 1 and amounts to $95 or 1 percent of income this year, could save more than $1,000 compared to someone who buys insurance. That savings even includes the cost of visits to the doctor’s office. If that hypothetical young person has to visit the emergency room, he still could be better off uninsured—$700 better, according to the study.

The enrollment problem may even go beyond the young invincibles. Twenty to 30 percent of people whom the administration counts as having “purchased” insurance via the exchanges have yet to actually make a payment to cover the premium. So they don’t actually have insurance. These folks could be in for a rude awakening if they don’t find out that they’re uncovered until they’re at the doctor’s office or hospital.

The government’s enrollment numbers even demonstrate that the program is failing to accomplish its core goal of providing coverage for the uninsured. According to McKinsey and Co., only 11 percent of the 2.2 million people enrolled through December were previously uninsured.

Nowhere are the failures of the exchanges more apparent than in the Latino community. Nearly one-third of Latinos are uninsured—almost twice the national average. Latinos also skew younger than other ethnic groups. And they were staunch supporters of President Obama in 2012; the president took Hispanics by a 2.6 to one margin. Yet in California, only 20 percent of enrollees are Latino—even though the group accounts for 46 percent of all folks eligible for premium subsidies in the state.

State and federal officials are paying an awful lot for these subpar enrollment numbers. The cost per enrollee ranges from $1,500 in California to nearly $57,000 in Hawaii. The government has invested $205 million in the president’s birthplace to enroll just 3,614 people. Washington, D.C. has signed up just over 5,000 people on its exchange—despite taking in more than $133 million in federal money. Those 5,000 folks put the District 12 percent of the way toward its enrollment goal.

If enrollment continues to skew older and sicker, insurance companies will have to raise premiums. As that happens, fewer people will sign up. Others will drop their coverage. Both outcomes will drive costs for individuals and taxpayers up even further.

The White House has essentially given up on its initial goals of 40 percent young invincibles in a crowd of seven million enrollees by the end of March. Moving the enrollment goalposts may mute some of the political blowback from the exchanges’ failures. But it won’t change the math that underpins the exchanges. That could spell trouble for patients expecting affordable coverage—and taxpayers who may be called upon to shell out more to give it to them.

Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. A version of this article was originally published by Forbes.

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Is a Doctor Shortage on the Horizon?

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.

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Is Part-Time Work Obama’s New American Dream?

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.

The Wall Street Journal explains:

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.

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Oregon Medicaid Study Doesn’t Love Big Brother

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.

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.

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ObamaCare’s Employer Mandate Already Costs Employees

By Sally C. Pipes

Some 60 percent of Americans—nearly 160 million people—get insurance through their jobs. Thanks to ObamaCare, that number is about to nosedive. The president’s signature law is hiking the cost of health insurance for American businesses of all sizes. They’re responding by dumping coverage for workers, spouses, and retirees.

Even though the employer mandate, which requires all firms with 50 or more full-time staffers to provide health coverage or pay a fine, has been delayed by one year, the employer health insurance market is slowly bleeding out.

Recently, 30,000 grocery workers in Washington State threatened to go on strike after several supermarket chains announced plans to drop health benefits for part-time workers. Today, workers who put in as few as 16 hours are eligible for health coverage. But the stores say that they won’t be able to afford coverage for part-timers once the employer mandate kicks in on January 1, 2015.

That’s not surprising. Average annual employer-sponsored individual health insurance premiums are up 5 percent this year compared to 2012—to more than $5,800. The average employer premium for a family of four is north of $16,000.

In September, Home Depot announced plans to drop coverage for roughly 20,000 part-time workers. They’ll have to shop for insurance in ObamaCare’s exchanges—which are barely operational despite officially opening for business October 1. Part-timers at Trader Joe’s will have to do the same. They won’t be alone. A National Business Group on Health survey found that one-fifth of big companies think their currently covered part-time workers could end up in the exchanges next year.

ObamaCare is even taking away the benefits of full-time workers—by encouraging their employers to cut their hours and rechristen them as part-timers. The law defines “full-time” as working 30 or more hours per week. So many firms are carefully watching their employees’ hours to ensure that they don’t cross that threshold. A survey conducted by the nonprofit International Foundation of Employee Benefit Plans found that 15 percent of employers subject to the mandate planned to cut hours to reduce their coverage burden.

Spouses also are learning firsthand how ObamaCare will destabilize their families’ benefits. In August, shipping giant UPS said that it would drop coverage for about 15,000 spouses who have access to benefits at their own jobs. The reason? “Costs associated with the Affordable Care Act,” the company said. According to a Towers Watson survey, 12 percent of employers plan to drop coverage for spouses next year, up from 4 percent this year.

Retirees, too, will increasingly find themselves pushed into ObamaCare’s exchanges. Consulting firm Aon Hewitt found that nearly two-thirds of the companies it surveyed plan to “review their retiree health care strategy in light of health care reform.”

To fight back against ObamaCare-fueled cost increases, many companies are turning to consumer-directed health plans, which typically pair low-premium, high-deductible policies with tax-advantaged Health Savings Accounts (HSAs). These plans empower patients to take control of their care. They can save money tax-free in their HSAs and use the proceeds for copayments and other out-of-pocket costs. The high-deductible policy, meanwhile, protects them in the event of a medical catastrophe. And because patients actually own their health care dollars, they have strong incentives to spend wisely.

That dose of market discipline helps lower overall health costs. About one in five workers was enrolled in an HSA plan this year, according to the Kaiser Family Foundation, up from zero in 2005. HSAs are now the second-most popular employer-provided plan. Aon Hewitt says that they could be the leader within three to five years.

Unfortunately, ObamaCare attempts to squash this consumer-directed approach by capping deductibles and requiring all policies to cover a wide array of expensive benefits. The law’s supporters claim its rules will ensure patients get quality coverage. But as the turmoil in the employer-sponsored insurance market demonstrates, ObamaCare may instead ensure that Americans get no coverage at all.

Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. A version of this article was originally published by The Detroit News.

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AP: Cover Oregon Is ObamaCare’s “Biggest Failure”

Seven weeks after launch, Oregon’s online health insurance exchange Cover Oregon still hasn’t enrolled one person, surprising out-of-state onlookers who would have voted Oregon “most likely to succeed.” An Associated Press story puts it this way:

“With all the problems facing the rollout of President Barack Obama’s health care overhaul, nowhere is the situation worse or more surprising than in Oregon, a progressive state that has enthusiastically embraced the federal law but has so far failed to enroll a single person in coverage through the state’s insurance exchange.”

The Oregonian has reported on numerous reasons for the delays, including last-minute federal rulemaking that set back Oregon’s website programming. Even so, Oregon received $245 million in federal money to build its online exchange, only to be processing 18,000 paper applications by hand three weeks into November.

It’s safe to say that dysfunction on this level would not be tolerated anywhere outside government: Imagine if your financial institutions were offline and nonresponsive for two months. The stunning failures of Cover Oregon and the federal website Healthcare.gov illustrate graphically how handing government vast control over important aspects of our personal and family lives results in even more loss of personal freedom than was foreseen when the Affordable Care Act was passed. Incompetence without accountability will have real consequences for those who, through no fault of their own, may find themselves without insurance on January 1.

Kathryn Hickok is Publications Director at Cascade Policy Institute, Oregon’s free market public policy research organization.

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ObamaCare Unraveling―And It Gets Worse in 2014

By Sally C. Pipes

With ObamaCare’s health insurance exchanges unraveling (especially HealthCare.gov, the federally run portal for the 36 states that decided not to set up their own exchanges), it’s safe to say that President Obama’s effort to expand coverage isn’t going well.

It’s about to get worse. Once the calendar flips to 2014, ObamaCare intends to expand Medicaid—the joint federal-state health insurance program for low-income Americans—to an additional 8.7 million people. But Medicaid isn’t working for the 62 million Americans it currently covers.

Taxpayers are struggling to shoulder the program’s $400-billion-plus price tag. Beneficiaries, meanwhile, are finding that doctors won’t accept their coverage. Expanding the program will only exacerbate both problems. Fortunately, some states are experimenting with reforms that inject private-sector discipline into Medicaid, thereby improving access to care and reducing costs. Other states should take note and adopt similar reforms.

At present, states largely determine who qualifies for Medicaid. Next year, ObamaCare will instruct them to cover everyone earning less than 138% of the poverty level. To entice states to follow through, the feds will cover the cost of the expansion for new enrollees for the first three years. States will have to share in the cost thereafter. Nevertheless, over half the states are refusing to follow ObamaCare’s dictates and not taking federal funds, exercising the right the U.S. Supreme Court gave them in June 2012 to do so.

Many states are wary of expanding Medicaid because those already in the program struggle to secure care. Between 2011 and 2012, about a third of primary care physicians weren’t accepting new Medicaid patients. A study from 2011 found that two-thirds of children on Medicaid couldn’t get an appointment with a specialist.

Doctors are reluctant to accept Medicaid because the program pays them so little. The entitlement reimburses physicians a little more than half the amount that private insurers do. In some cases, Medicaid’s reimbursements don’t cover the costs doctors incur seeing beneficiaries.

It’s no surprise, then, that the program fails to improve its beneficiaries’ health. A randomized study of Oregon’s Medicaid program published earlier this year in the New England Journal of Medicine concluded that “Medicaid coverage generated no significant improvements in measured physical health outcomes.”

For a failing program, Medicaid costs a lot. States spend more on Medicaid than anything else in their budgets—and collectively shoulder approximately one-third of the program’s more than $400 billion in annual costs.

ObamaCare’s Medicaid expansion will only add to these costs. A new survey of state Medicaid offices shows that, in 2014, spending on the program will increase by 13% in states that have agreed to broaden eligibility in accordance with the law. It’s no wonder that many state leaders are looking to buck the Medicaid status quo.

In September 2013, Arkansas Gov. Mike Beebe secured a waiver enabling his state to use federal funds set aside for Medicaid to provide private coverage to 218,000 residents. The state’s Department of Health reports that more than 56,000 people have asked to participate in the Arkansas Healthcare Independence Program.

Arkansas officials believe they’ll save $670 million over 10 years, thanks to the waiver. Leaders in Indiana, Ohio, Pennsylvania, Iowa, and Tennessee have expressed interest in creating similar “private options.” Arkansas’s approach empowers individuals to shop for insurance that suits their needs, rather than settling for one-size-fits-all policies.

Privately delivered Medicaid also permits state officials and patients to expand the availability of tax-advantaged health savings accounts (HSAs) to low-income families. These accounts give families the ability to shop around for care—and to save tax-free for the future whatever they don’t spend now. Encouraging such consumer-driven behavior in the health care marketplace will be crucial to reducing overall costs.

North Carolina Gov. Pat McCrory has adopted a different approach, proposing that private managed-care firms administer his state’s Medicaid program. Dubbed “Comprehensive Care Entities,” these companies would be tasked with overseeing patient care in a way that improves health outcomes while keeping costs down. They’d also compete against one another, creating an incentive to improve customer service, economic efficiency, and quality of care.

More state leaders should look for ways to use choice and competition to move past Medicaid’s status quo. If they don’t, they’ll simply perpetuate ObamaCare’s strategy of expanding failed programs and calling it progress.

Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. A version of this article was originally published by Investors Business Daily.

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Court Says “No” to Forced Insurance Subsidy

The federal government’s HealthCare.gov website has been nearly useless for a month. Now, millions of Americans are beginning to receive letters informing them of the cancellation of their current health insurance policies―proving the inaccuracy of President Obama’s promise that “if you like your health care plan, you can keep your health care plan.”

But news reports on ObamaCare as the calendar turned to November largely missed another important story. A controversial provision of the Patient Protection and Affordable Care Act (ObamaCare) suffered a judicial setback in the D.C. Circuit Court of Appeals on November 1. Writing on behalf of the court, the judge highlighted an important civil libertarian concept which is also at the heart of many principled objections to the health care law.

In Gilardi v. U.S. Department of Health and Human Services, the D.C. Circuit Court granted the plaintiffs, who own a family business, a preliminary injunction against the imposition of the HHS Mandate requiring inclusion of contraception and abortifacient drugs in employee health insurance plans. The Gilardi family, who are Catholics, contend that the HHS Mandate requiring coverage for contraception, sterilization, and abortion-inducing drugs violates their religious beliefs and that requiring their company to cover employees’ contraception, or else pay a $14 million penalty to the IRS, is unduly burdensome. The court sided 2-1 with the Gilardis. In her ruling, Judge Janice Rogers Brown made a distinction between “noninterference” with a person’s choices and the “compelled subsidization” of those choices by another party.

The Obama Administration has consistently held that the HHS Mandate requiring contraceptive coverage is necessary to protect women’s reproductive and abortion rights. The Administration argues that women’s right to have access to contraception trumps the First Amendment rights of those who object to providing these services on religious or moral grounds. The President has refused to accommodate the conscience objections of policyholders, religious and secular employers, and charitable organizations during ObamaCare rulemaking.*

However, Judge Brown wrote on behalf of the court that “it is clear the government has failed to demonstrate how such a right―whether described as noninterference, privacy, or autonomy―can extend to the compelled subsidization of a woman’s procreative practices.”

The distinction between “noninterference” and “compelled subsidization” is important for reasons broader than conscience objections alone, and it should strike a chord with civil libertarians. The expansion of government programs and entitlements (including medical benefits specifically handpicked by the government) pits the newly created “rights” of some to receive additional products and services, against the rights of other people who may be paying for them in whole or in part (as employers, policyholders, or taxpayers).

Charles Krauthammer recently explained the connection between ObamaCare’s health care entitlements and coercion this way:

“The planners knew all along that if you force insurance buyers to overpay for stuff they don’t need, that money can subsidize other people. Obamacare is the largest transfer of wealth in recent American history. But you can’t say that openly lest you lose elections. So you do it by subterfuge: hidden taxes, penalties, mandates, and coverage requirements that yield a surplus of overpayments. So that your president can promise to cover 30 million uninsured without costing the government a dime. Which from the beginning was the biggest falsehood of them all. And yet the free lunch is the essence of modern liberalism. Free mammograms, free preventative care, free contraceptives for Sandra Fluke. Come and get it.”

Once the government has successfully compelled all Americans to purchase health coverage―even against their will―under ObamaCare’s individual mandate in order to make this wealth transfer possible, it is a short slide into compelling Americans to subsidize other people’s benefits to which they morally object.

To protect Americans’ constitutional rights, and rein in the entitlement culture, the courts need to affirm consistently that not interfering with another person’s choices does not mean forcing others to provide, subsidize, or enable those choices. According to the Becket Fund for Religious Liberty, 77 cases representing 200 plaintiffs have been filed against the HHS Mandate on First Amendment grounds. Regardless of Americans’ disagreements over the ethics of contraception and abortion, the freedom not to be financially complicit in the choices of others to which one morally objects ought to be a value on which many of us can unite. The First Amendment may end up being one of the last legal defenses citizens have against the unfettered expansion of the entitlement state.

 

* The HHS Mandate has an extremely narrow conscience exemption which does not apply to for-profit businesses or to organizations which may be religious by any common-sense standard but are not run by a church.

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The ObamaCare Exchanges: Nowhere Near As Competent As the Post Office

By Sally C. Pipes

What was the worst product launch in history? New Coke, perhaps? How about Colgate’s Dinner Entrees, the frozen food packages with a label mimicking that company’s brand of toothpaste? The Santa Dreidel? They’re all marketing masterpieces compared to the rollout of ObamaCare’s health insurance exchanges—particularly those accessible through HealthCare.gov, the portal operated by the federal government that “serves” 36 states. Though these online marketplaces officially opened October 1, they’ve thus far proven abject failures in their stated mission of expanding the availability of health insurance.

As of October 19, federal officials claimed that 476,000 people had applied online for health coverage. But there’s a big difference between the number of folks who have begun applications—and the number of people who have actually enrolled. According to insurance industry consultant Robert Laszewski, that enrollment figure could be less than five figures. Through its first week, the federal system, which was supposed to work for millions of Americans, had reportedly enrolled about 5,000 people in the 36 states it covers.
Insurers estimate that just one percent of applications submitted through the federal exchange contain sufficient information to actually enroll a person in a health plan. It’s no wonder that the Obama Administration has been mum about official enrollment figures. Visitors have often found that they can’t even log in. A CNN reporter, for instance, couldn’t do so for a whole week. A New York Times researcher failed to log in over 40 separate attempts covering 12 days.

The disastrous rollout of the federal exchange has caused even champions of ObamaCare to train their fire on the president’s team. Washington Post columnist Ezra Klein has said that the Affordable Care Act’s launch this fall has been not been “troubled” or “glitchy” but a “failure.” Robert Gibbs, President Obama’s former press secretary, wants heads to roll, saying, “I hope they fire some people that were in charge of making sure that this thing was supposed to work.”

The Administration has asked the contractors hired to build the system to perform necessary repairs in hopes of re-launching the exchange November 1. But that’s unrealistic, according to the contractors as well as outside experts. One told the New York Times that as many as five million lines of code may need to be rewritten.

Fourteen states and the District of Columbia have set up their own online exchanges. They’re faring little better than the federal exchange. Take Vermont. In the Green Mountain State, 4,300 residents created state insurance accounts. But only 700 were able to apply for insurance—and just 115 of these folks were able to enroll. In Maryland just 1,121 of the 25,781 people who created accounts were able to finish their online applications and get enrolled. That’s less than 5 percent. And the exchanges in Vermont and Maryland are among the better-working ones.

Nine of the 14 states and Washington, D.C. won’t release enrollment data. Oregon admits that its system isn’t fully operational. Hawaii’s exchange launched October 1 but couldn’t enroll anyone for two weeks. Idaho’s and New Mexico’s systems were so hopeless that the states had to turn operations over to the troubled federal system.

Meanwhile, a wide range of experts say that ObamaCare’s online systems are lacking in cyber-security measures and thus invite identity theft. The site’s designers appear not to have included ordinary protections against automated attempts by rogue hackers to falsely log into the system. So cyber criminals can potentially see a user’s social security number, where he lives, how much he makes, and so forth. According to the founder of the McAfee cyber-security company, the exchanges have “no safeguards” and their lack of protection is “outrageous.”

Then there’s the possibility of fraud. The Department of Health and Human Services will not verify the self-reported incomes of all applicants—just those of a sample. Consequently, the federal government could end up doling out millions in unmerited subsidies.

The cause of this mess is not a lack of money. The federal government has spent $634 million on its system—more than the combined cost to design and build LinkedIn and Spotify. That’s nearly seven times the original projected cost. The Obama Administration should have seen this debacle coming. A principal designer of the system, CGI Federal, was fired by the provincial government of Ontario in Canada in September 2012 for botching the province’s online medical registry. The contractor had missed three years of deadlines.

But CGI may have had an impossible task. According to the New York Times, the firm did not begin writing code for the exchange website until the spring of 2013—because the government had been so slow to issue specifications.

One month in, it’s clear that ObamaCare’s exchanges were not ready for primetime, even though Health and Human Services Secretary Kathleen Sebelius repeatedly assured the American public that the marketplaces would launch—and work—as planned. These online marketplaces must function properly if the law is to expand coverage as it promises—and if Americans are to be able to comply with its requirement that they obtain insurance. With each passing day, both are looking less likely.

Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. A version of this article was originally published by Forbes.

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October Chaos for Cover Oregon

Three weeks after launch, Oregon’s online health insurance exchange Cover Oregon hasn’t enrolled a single person. $82 million has been spent on a website which has received more than 430,000 visits and 3.7 million page views, and yet still cannot process applications.

According to Shelby Sebens of Northwest Watchdog, Cover Oregon spokesperson Ariane Holm “said she anticipates Cover Oregon’s website will be fully functional by the end of October. She also said residents can download an application and mail it back in or file it electronically. Or they can call Cover Oregon to start the application process.”

The Oregonian has reported on numerous reasons for the delays, including last-minute federal rulemaking that set back Oregon’s website programming. Oregon hasn’t been alone with these problems: HealthCare.gov, the national website for the Affordable Care Act, cost more than $400 million dollars and has been experiencing well-publicized, thorough dysfunction since October 1.

One would think functioning websites wouldn’t be too much to ask for the official ObamaCare rollout, the date of which was the focus of both national and statewide awareness campaigns. October’s online chaos seems to bode ill for the future of Americans’ health care experiences. Hopefully, people will rethink having increased centralized government control over a health care system which comprises nearly one-fifth of the U.S. economy.

Kathryn Hickok is Publications Director at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Drug Cartels, Not Cold Medicine Patients, Are the Enemy in Oregon’s Meth War

It seems that despite the best efforts of Oregon policymakers and law enforcement, methamphetamine (meth) abuse continues to ravage the Beaver State.

Recent media coverage has unveiled a newer, darker side of the Oregon drug scene—Mexican drug cartels trafficking meth into our state. In the past, they were a fringe sideshow; more meth was produced locally. That has changed. They are now the dominant supplier. And the meth problem has become less predictable, more expensive, harder to spot, and generally more violent.

The infiltration of drug cartels is the logical outcome of the state’s steady decline in local meth production. Since 2005, Oregon, along with surrounding Washington and California, began to see a drastic drop in the number of meth labs busted in the state. Compounding that trend, policymakers adopted a strict new law in 2006 that required residents to obtain a prescription in order to purchase cold and allergy medicines containing pseudoephedrine, a precursor to meth production. The impetus for the new restriction was the belief that by restricting the sale of pseudoephedrine, meth would be kept out of the hands of criminals, and meth abuse in our state would be impacted.

The outcome has turned out to be quite the opposite. As local meth production declined, generally for reasons separate from Oregon’s pseudoephedrine prescription law, violent Mexican drug cartels have been able to infiltrate so much of the state that they have become impossible to ignore. As was pointed out recently by The Oregonian in an exposé on the topic, the Mexican meth now flowing into the state has the added benefit of also being cheaper and more potent than any other meth on the market. As a result, meth abuse, and related meth crime, hasn’t decreased in the least. Indeed, the 2013 Oregon High Intensity Drug Trafficking Area’s Threat Assessment and Counter Drug Strategy report surveyed law enforcement across the state who said that meth remains the number-one cause of property crime and violent crime. Meanwhile, the Office of National Drug Control says that Oregon meth seizures have been trending upward since 2008; and the Drug Enforcement Administration (DEA) conservatively estimates that 80% of the country’s meth now comes from over the southern border.

But all of these facts still don’t change the minds of those who are convinced that Oregon’s prescription laws for pseudoephedrine successfully cured the state of its meth problem. Oregon’s experience is referenced often as the model solution. Even a recent federal Government Accountability Office (GAO) study cites Oregon’s success in enacting proactive legislation as the reason for its progress. In reality, however, Oregon’s prescription law is not responsible for the state’s drop in meth labs, and its meth problem is anything but solved.

Last year, Cascade Policy Institute performed a study to determine whether Oregon’s prescription mandate was the reason for the state’s reduction in meth labs. The findings were enlightening. Our study concluded that while Oregon had seen a dramatic drop in meth labs between 2004 and 2010, it was not a result of a prescription mandate. We were able to draw that conclusion by looking at regional trends and timelines. Other western states including California and Washington saw similar declines without the passage of prescription laws. And by breaking the data down by year, we found that the vast majority of Oregon’s decline in meth production took place prior to the passage of any prescription law.

Our research was meticulous, reliable, and verifiable. It has since been confirmed by other researchers, including most recently by Siddharth Chandra of Michigan State University. Dr. Chandra conducted his own study in response to the above-mentioned GAO report, criticizing it for its methodology. Noting that the report fails to account for regional trends, he determines that the GAO falsely attributes a decline in meth labs to Oregon’s strict prescription laws. His conclusions are accurate and consistent with Cascade’s.

The fallacy of the Oregon experience has lived on long enough. It is time for policymakers across the country to understand that Oregon’s prescription law for pseudoephedrine has failed to achieve its goals. Meanwhile, honest Oregonians who simply want to buy effective cold medicine over the counter have been forced to suffer due to tight restrictions on their personal freedoms. If progress is to be made in the fight against methamphetamine abuse, an honest discussion must take place. It is time to admit the failure of prescription laws for pseudoephedrine.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Seven Steps to Replace ObamaCare with Something That Works

By Sally C. Pipes

Under the Affordable Care Act, state health insurance exchanges open for business October 1 (although the executive director of Cover Oregon has admitted Oregon’s exchange will experience some delays). While ObamaCare remains a controversial―as well as logistically catastrophic―law, President Obama took a shot at its opponents recently, saying, “There’s not even a pretense now that they’re going to replace it with something better.”

Au contraire. Ideas for “something better” abound—but the president hasn’t shown interest in them. He has instead remained devoted to his eponymous law, which promises higher costs and worse care. At this point, ObamaCare’s critics have to play the long game―and press for delays in the law’s implementation, whether by rolling back certain parts of the law or defunding it through a continuing resolution, until the White House has a new occupant.

Here are seven provisions that should be part of a replacement agenda that would ensure that all Americans have affordable, accessible, quality health care.

First, change the federal tax code so that individuals can purchase insurance with pre-tax dollars, just like businesses can. Most Americans don’t realize the full cost of their health care because they get employer-subsidized insurance. Consequently, they over-consume health care. That drives up costs. To offset the cost of insurance for those who don’t get coverage through work, Congress could institute a refundable tax credit.

Second, it’s long past time to expand the availability of health savings accounts, where patients can save pretax dollars for health services. And, HSAs must be combined with catastrophic coverage. Doing so would encourage Americans to shop smartly for their care, as they’d be spending their own money.

Third, Congress should allow the purchase of insurance across state lines. Insurance policies issued in Rhode Island cost 2.5 times what they do in Alabama. People should be able to purchase a plan that suits their needs. Such a move would increase competition and lower costs.

Fourth, policymakers need to increase funding for high-risk pools. Such pools were functioning well in many states before ObamaCare―providing affordable coverage to those with pre-existing conditions without raising premiums for everyone else.

Fifth, federal electronic health records (EHR) mandates have to go. The average initial cost of an EHR system is $44,000 per physician, with ongoing maintenance estimated at $8,500 annually. Those costs are passed on to patients. Instead, let providers implement EHR systems when it makes financial sense for them to do so on their own.

Sixth, Congress should scrap the essential health benefits mandates that require all policies to cover a battery of health services. Such mandates can raise the cost of insurance anywhere from 10 to 50 percent.

And seventh, state-level medical malpractice reform is long overdue. Each year, more than $100 billion in health care expenditures are driven by doctors’ and hospitals’ worries about medical liability. Common sense tort reform that immunizes providers from frivolous lawsuits would usher in lower costs for patients.

Of course, all these reforms are contingent on repealing ObamaCare. The House of Representatives has certainly tried to move that effort forward, voting 40 times to do so.

Death by a thousand cuts may be more realistic, at least in the short term. In June, the House voted to repeal ObamaCare’s medical device tax, with 37 Democrats joining Republicans to pass the bill.

And in the past three months, 22 House Democrats have signed onto legislation repealing the Independent Payment Advisory Board (IPAB)―ObamaCare’s doomed plan to have 15 unelected bureaucrats dictate Medicare spending with no real congressional oversight or control.

Public opinion and legislative momentum favor ObamaCare’s delay, if not its outright repeal. And contrary to the president’s assertion, there is a plan to replace ObamaCare with something better. Once the president is no longer standing in the way, Congress should implement that plan―and fix American health care for real.

But if lawmakers allow ObamaCare to stand, the next stop will be a single-payer system, where government controls the health care system entirely. Senate Majority Leader Harry Reid has admitted as much. When asked in August if he felt the United States should abandon insurance as a means of accessing the health care system, Reid replied, “Yes, yes. Absolutely yes.” This will put America on the road to serfdom, and there will be no off-ramp.

Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. A version of this article was originally published by The Washington Examiner.

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As the Expense of ObamaCare Sets In, Companies Cut Health Benefits

By Sally C. Pipes

Implementation of the Affordable Care Act continues this fall and winter, and employees of shipping giant United Parcel Service recently got an unexpected delivery. The company announced that it would stop offering health coverage to the spouses of 15,000 workers.

UPS’s workers and their families can thank ObamaCare for this special delivery. And UPS isn’t alone. American businesses are discovering that the president’s signature law will raise health costs for them and their employees in short order.

In a memo explaining the decision to employees, UPS stated that increasing medical costs “combined with the costs associated with the Affordable Care Act, have made it increasingly difficult to continue providing the same level of health care benefits to our employees at an affordable cost.”

One day before UPS’s big announcement, the University of Virginia announced that it would cut benefits for spouses who have access to health care through jobs of their own. The rationale was similar. Delta Airlines recently revealed that ObamaCare will increase its direct health costs by $38 million next year. After taking into account the indirect costs of the law, the company is looking at a 2014 health bill that’s $100 million higher.

Increasingly, large employers who aren’t dropping spousal health benefits are requiring their employees to pay monthly surcharges in the neighborhood of $100 per spouse. Many small businesses are dropping family coverage altogether because they expect that ObamaCare’s new tax on insurers will be passed on to them in the form of higher premiums. One Colorado-based business received notice from its insurer that the tax would increase premiums more than 20 percent.

The story is similar in Massachusetts. One new report concludes that over 45,000 small businesses in the Bay State will see premium increases in excess of 30 percent. In all, more than 60 percent of firms in the state will see their premiums go up.

Last month in California, the largest insurer for small businesses, Anthem, declared that it would not participate in the state’s small-business health insurance “marketplace,” Covered California. Only two years ago, Anthem covered one-third of small businesses in California. Anthem’s exit represents one less choice for consumers—and a sign that competition may not be as robust in the exchanges as the Obama Administration promised.

Small businesses are responding to these higher premiums by trimming their labor costs in other ways. That’s not good news for workers. Seventy-four percent of small employers plan to have fewer staff because of ObamaCare, according to a recent U.S. Chamber of Commerce survey. Twenty-seven percent are looking to cut full-time employees’ hours, 24 percent to reduce hiring, and 23 percent to replace full-time with part-time employees.

One in four small companies say that ObamaCare was the single biggest reason not to hire new workers. For almost half, it’s the biggest business challenge they face. These findings are consistent with a recent Gallup Poll showing that 41 percent of small businesses have already stopped hiring because of ObamaCare. Another 19 percent intend to make job cuts because of the law.

All this tumult in the labor market is fueled by more than the increase in premiums engendered by ObamaCare. The law effectively encourages companies to cut full-time jobs. ObamaCare requires employers with 50 or more workers to provide health insurance to all who are on the job for 30 or more hours per week. The law originally called for this “employer mandate” to take effect in 2014, but the Administration decided in July to delay enforcement of the mandate until 2015.

Employers are responding by doing just enough to avoid ObamaCare’s dictates. Administrators at Youngstown State University in Ohio recently told adjunct instructors, “[Y]ou cannot go beyond twenty-nine work hours a week….If you exceed the maximum hours, YSU will not employ you the following year.” A week prior the Community College of Allegheny County in Pittsburgh made a similar announcement.

Hundreds of employees at Wendy’s franchises have seen their hours reduced for the same reason. And part-time employees of Trader Joe’s, which has eight locations in the Portland area, are losing their company-sponsored health insurance. Trader Joe’s has offered health and dental coverage for years, but now part-time workers are being directed to the state health insurance exchanges.

Meanwhile, companies with fewer than 50 employees are thinking twice about expanding—and thus being ensnared by ObamaCare’s requirement that they provide health insurance. The cost of each additional employee could be staggering. A firm with 51 employees that declined to provide health coverage would face $42,000 in new taxes every year—and an additional $2,000 tax for with each new hire. Providing coverage, of course, would be even more expensive.

As private firms large and small grapple with ObamaCare-fueled cost increases, one large employer—the federal government—has been quietly exempting itself from portions of the law. Top congressional staffers like their current benefits under the Federal Employee Health Benefits Plan (FEHBP), wherein the government pays up to 75 percent of the premiums. But the law requires those who work in lawmakers’ personal offices to enter the exchanges. And in many cases, staffers make too much to qualify for health insurance subsidies through the exchanges. So they’d be facing a hefty cut in their compensation.

Fearing a mass exodus of congressional staffers from Capitol Hill, the Obama Administration fudged the law to permit lawmakers’ employees to receive special taxpayer-funded subsidies of $4,900 per person and $10,000 per family. Yet only three months ago, Senate Majority Leader Harry Reid (D-Nev.) claimed that Congress wouldn’t make exceptions for itself.

President Obama no doubt knows that these congressional favors won’t go over well with ordinary Americans. So he’s called on his most popular deputy—former President Bill Clinton—to try to sell the law to the public once again. But unless the former president can lower employer health costs with little more than the power of his words, his sales pitch will likely fall flat.

Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. A version of this article was originally published byForbes.

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For Small Business Owners, The ObamaCare Reality Bites

By Sally C. Pipes

More than 40 percent of small businesses have frozen hiring because of ObamaCare, according to a new poll from Gallup. A fifth have actually cut their workforces as a direct result of the health care reform law.

That’s not exactly the future President Obama forecast in 2009, when he told an audience of small-business owners that his health care reform package was “being written with the interests of Americans like you and your employees in mind.” He boasted that he had “no doubt [the law] would benefit millions of small businesses.”

Instead, small-business owners are learning that ObamaCare will drive the cost of insurance up without providing the choice of policies it promised. The law intended to make purchasing insurance easier for small businesses by creating exchanges, where firms could band together with their peers in one statewide risk pool—and thus leverage their buying power to secure lower premiums and access to a wide variety of plans. The Congressional Budget Office projected that two million people would get insurance through the small-business exchanges.

Insurers would compete for small businesses’ allegiance, driving down prices further. Employers would name a benefits level, and then their employees could choose from among several plan options at that level. Under the status quo, by contrast, they may be stuck with the plan their employer picks for them—if they even get insurance at all.

But the exchanges aren’t unfolding as planned.

For starters, it’s not clear that the exchanges will be ready by the October 1 deadline set by ObamaCare. Creating these government-directed insurance marketplaces in all 50 states plus the District of Columbia has proved far more complicated than bureaucrats anticipated.

Maryland, which was one of the first states to embrace ObamaCare, announced in April that it would delay the launch of its small-business exchange by at least three months. A recent Government Accountability Office report said that all 16 states and the District of Columbia building their own exchanges are behind schedule—missing deadlines on 44 percent of the key activities needed to get them up and running. In Oregon, the state’s largest health insurer and three others are steering clear of the state exchange designed to serve small employers.*

In the mad dash to get the exchanges built, officials are cutting corners. The promised choice of plans has been the first casualty. This June, the federal government announced that every business owner shopping in the 33 federally run exchanges will have to pick one plan for all his full-time employees.

In some states, there may only be one choice for every single small business in the state—as insurers have been reluctant to participate. Just one insurer signed up to provide small-business coverage in Washington’s exchange. Ditto for New Hampshire and North Carolina. In Mississippi, not a single insurance company has signed up for the federally run exchange. That lack of competition will no doubt yield higher premiums. ObamaCare’s many mandates will exacerbate their upward march.

The health care reform law requires all policies to cover preventive care free of charge—along with a host of other “essential” benefits. Policies cannot cap annual or lifetime health care spending, and annual deductibles cannot exceed $2,000 for an individual or $4,000 for a family in the small-group market.

Businesses are starting to see the result of all these mandates and regulations. An analysis of 11 states by the insurer WellPoint projects that small-group premiums will jump an average of 13-23 percent.

In Rhode Island, insurers want to boost small business premiums by 14 percent, on average. Maryland’s biggest insurer, CareFirst BlueCross BlueShield, is pushing for an average small-business rate hike of 15 percent. And a survey by the American Action Forum earlier this year found that major insurers in five big cities were expecting small-business premiums to more than double for small firms with healthier employees. So rather than freeing small businesses from the burden of having to manage their own health benefits, ObamaCare has raised the prices they’ll pay and limited their options.

It’s no wonder that small businesses are cutting benefits, putting off hiring—or even firing workers. A quarter of small firms say they’re considering whether to drop insurance coverage, and 18 percent have reduced their employees’ hours to part-time. Thirty-eight percent say that ObamaCare has caused them to pull “back on their plans to grow their business.” So much for writing the law with the “interests” of small businesses and their employees in mind.

The Obama Administration just announced that they’d delay the implementation of the employer mandate, which would require all businesses with more than 50 full-time employees to offer health insurance. Hopefully, ObamaCare’s small-business exchanges will be the next component of the law to be delayed.

* “Insurers skip Oregon’s small employer insurance exchange—for now,” Business Journal, May 3, 2013 (http://www.bizjournals.com/portland/blog/2013/05/insurers-steer-clear-of-oregons-small.html?page=all).

Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. A version of this article was originally published by Forbes.

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The Opportunity to Protect Our Rights and Our Children

By William Newell

Medical technology has miraculously saved millions of lives. Our constitutionally limited, representative government is just as miraculous. Both are designed to improve the human condition. Sometimes though medicine and government clash. The ongoing debate in Oregon concerning religious exemptions from vaccinations exemplifies this conflict.

Over 90 percent of Oregon parents currently vaccinate their children, but the state legislature still passed Senate Bill 132 which requires proof that parents seeking a religious exemption have been notified of the benefits and risks of vaccines. The legislation targets religious individuals because of their beliefs and burdens those individuals with complying to state desires. The Constitution of Oregon makes clear the state’s duty to protect religious liberty under Article 1, Section 3, which reads: “no law shall in any case whatever control the free exercise, and enjoyment of religeous (sic) opinions, or interfere with the rights of conscience.”

Additionally, placing informed consent stipulations on religious parents serves little purpose because  such information is widely accessible from doctors and government websites. Mandating parents watch a video or see a doctor is not going to change people’s minds. While vaccinating children is worthwhile, this legislation will not be very effective and undermines our precious constitutional rights.

William Newell is a research associate at Cascade Policy Institute, Oregon’s free-market think tank.

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"Priceless: Curing the Healthcare Crisis" Book Forum

Please join Cascade Policy Institute for our next book forum featuring John Goodman, Ph.D., President and CEO of the National Center for Policy Analysis and Research Fellow at the Independent Institute in Oakland, California.  Dr. Goodman is recognized as the Father of Health Savings Accounts (HSAs). The event will focus on his latest book,  Priceless: Curing the Healthcare Crisis.

Goodman regularly appears on television and radio news programs on Fox News Channel, CNN, PBS, Fox Business Network, and CNBC, and his articles appear in The Wall Street Journal, Investor’s Business Daily, National Review, Health Affairs, Kaiser Health News, and other national publications. Goodman was also the pivotal lead expert in the grassroots public policy campaign, “Free Our Health Care Now,” an unsurpassed national education effort to communicate patient-centered alternatives to a government-run health care system. The initiative resulted in the largest online petition ever delivered on Capitol Hill.

Price for admission includes assorted appetizers, dessert, coffee, and tea.  no-host bar also will be offered and books will be available for purchase.

To attend, RSVP with admission payment to Patrick Schmitt at 503-242-0900 or patrick@cascadepolicy.org by June 25, 2013.

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Is Being on Medicaid Better Than Having No Insurance at All?

By Roger Stark, MD, FACS

Does having health insurance actually save lives or improve health more than being uninsured? This question has not been answered until very recently.

In 2008, Oregon lawmakers decided they had enough additional public money to add 10,000 people to the state’s Medicaid program. So, Oregon officials held a lottery that ultimately signed up 6,400 new Medicaid enrollees. A further 5,800 people were eligible for the program but were not selected. People in this group had the same health and economic profile as the lottery winners. This created the perfect test case on the effectiveness of Medicaid in providing care. These 5,800 people became the control group in an objective, randomized study.

The two-year results of the health comparison study were published recently in The New England Journal of Medicine. The conclusion is surprising. It turns out that having Medicaid health insurance does not improve health outcomes, nor does it improve mortality statistics, compared with having no insurance coverage at all. The Medicaid group had no improvement in the important objective measurements of blood sugar levels, blood pressure, and cholesterol levels. The study did find that vaguely defined “mental health” did improve. However, this was done via subjective telephone interviews, not objective clinical data. For those few people requiring prolonged medical and hospital treatment, having Medicaid did improve their financial status because their medical bills were covered by federal and Oregon taxpayers.

The existing Medicaid program has 60 million enrollees nationally at a cost of $430 billion per year. Looking forward, the cost is estimated to increase to $900 billion per year by 2019. Medicaid is an extremely inefficient program, and reimbursement for doctors and other providers is about half of what private insurance pays for the same services. Doctors are not able to pay their own overhead with these low payment rates. Consequently, existing Medicaid patients have trouble getting access to health care.

The Washington State Medical Association did a recent survey of primary care providers. Results showed 18 percent had dropped all Medicaid patients, and 24 percent were not taking new Medicaid patients, due to poor payment and the complexities of Medicaid cases compared with privately insured patients. Getting access to health care is a significant problem for people in the existing Medicaid program in Washington. It turns out that having insurance on paper is not the same as actually obtaining health care services.

The Affordable Care Act, or ObamaCare, gives states the option to expand Medicaid to at least 16 million new patients nationally and 280,000 in Washington State. The law says that any adult over the age of 18 who earns less than 138 percent of the federal poverty level will be eligible for Medicaid. The estimated cost of this expansion to taxpayers is at least $450 billion over the first 10 years, beginning in 2014.

The Oregon study confirms that Medicaid does not provide better health care to people than having no health insurance at all. These terrible results not only come with a huge taxpayer cost, but also trap poor individuals in a virtually worthless health insurance plan.

The Washington State Legislature is considering expanding Medicaid in the current state budget negotiations. The federal government is bribing states with federal taxpayer money to expand Medicaid. Many state lawmakers support the expansion because it feels like “free” federal money, and they reason that Medicaid is better than no health insurance at all. The large, randomized Oregon study shows this is not true.

Of course, state taxpayers are also federal taxpayers, so ultimately the people of Washington State will pay for this Medicaid expansion. Medicaid is a pay-as-you-go program. The idea of leaving free federal money on the table makes no sense. If Medicaid doesn’t expand, the burden of taxes should be reduced for everyone.

Medical outcomes for people in the Medicaid program are no better than outcomes for people without health insurance. This fact makes it very difficult to argue that Medicaid is better than no insurance, especially considering the tremendous cost involved. Washington’s state legislators would do better to improve their existing Medicaid program; eliminate waste, fraud, and abuse; improve access; and make the program a real safety-net health insurance plan that provides quality care at a reasonable cost. Oregon’s state legislators should do the same.

Dr. Roger Stark is a health care policy analyst at Washington Policy Center in Seattle, Washington and a retired cardiothoracic surgeon. He has authored numerous in-depth studies on health care policy. Dr. Stark was one of the cofounders of the open-heart surgery program at Overlake Hospital in Bellevue and served on the hospital’s governing board. He is a guest contributor for Cascade Policy Institute, Oregon’s free market public policy research center.

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Three Years Later, ObamaCare Remains a Troubled Law

By Roger Stark, MD, FACS

President Obama signed the federal health care bill, The Affordable Care Act (ACA), into law three years ago. Let’s look at what has happened over the past three years.

The law remains extremely unpopular with Americans. Since passage, polls have consistently shown at least 50 percent of voters disapprove of the law. A recent Kaiser Family Foundation poll revealed that only 41 percent of respondents actually understood the law, while 57 percent did not.

The estimated cost of the law has gone up dramatically. Originally, the nonpartisan Congressional Budget Office (CBO) estimated ObamaCare would cost $940 billion over its first 10 years. This was based on a deception written into the law of 10 years of revenue starting in 2010 but only six years of benefits starting in 2014.

The CBO now estimates the cost to be $2 trillion over the 10 years starting in 2012. Revenue comes from a $716 billion cut to Medicare providers and over $1 trillion in new or expanded taxes. None of the significant Medicare cuts have taken place as scheduled, so the cost overrun of ObamaCare has already started. Health insurance companies are warning of 30 to 116 percent increases in premiums, and the government’s own CBO estimates at least 10 to 13 percent increases in rates.

Even President Obama sees the failure of parts of the law. He has signed the repeal of the long-term care provision, or CLASS entitlement. He also signed the repeal of the $1.7 billion Small Business Tax Reporting Requirement, which would have forced businesses to report every vendor transaction over $600 to the IRS. A bipartisan majority in the U.S. Senate recently voted 79 to 20 to repeal the 2.3 percent tax on medical device makers’ revenue (not profits).

The administration has, to date, granted 1,600 waivers to unions and various favored companies allowing them to opt out of ObamaCare. For the rest of us, the government has issued 20,000 pages of new regulations for implementation of the law and will force patients to fill out a 21-page application to receive care under the ACA (that’s the EZ form; the long form is 60 pages).

Medicaid expansion and new government-run insurance brokerages, or exchanges, are fundamental provisions of ObamaCare. Yet, 18 states have opted not to expand Medicaid, and 26 states have no plans to set up a state-run exchange.

The proponents of ObamaCare cling to a number of inconsequential benefits. Young adults from ages 19 to 25 now can be covered on their parents’ health insurance plans. These are the young and healthy, however, and the vast majority don’t need health care and don’t have much impact on health care costs. Also, when they turn 26 their parents’ coverage ends. They then will have to pay more than their fair share for health insurance because of the community rating requirement that forces young, healthier people to pay the same premium as older, sicker individuals.

Proponents also tout the mandated preventive care in the law. Yearly physical examinations and other preventive care are not “free,” and for large numbers of patients have no impact on health outcomes, nor do they save money.

We are also told the law prohibits insurance companies from denying coverage to patients because of pre-existing conditions. Research shows that only 62,000 people in the United States are in this group with no insurance and a pre-existing health problem. Spending $2 trillion to provide coverage to this small group is irresponsible and could be handled by shared-risk pools like the one Washington State already has.

The ACA is a 2,700-page, achingly complex, monstrous law that will soon control one-sixth of our economy. The country continues to dislike ObamaCare and remains puzzled by its mind-numbing complexity.

Everyone agrees health care needs to be reformed. Patients making informed choices in a free market―not top-down government mandates that will only result in higher costs, not better care―will put patients in charge of their health care decisions and their own health care dollars.

Dr. Roger Stark is a health care policy analyst at Washington Policy Center in Seattle, Washington and a retired physician. He has authored numerous in-depth studies on health care policy. Dr. Stark was one of the cofounders of the open-heart surgery program at Overlake Hospital in Bellevue and served on the hospital’s governing board. He is a guest contributor for Cascade Policy Institute, Oregon’s free market public policy research center.

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Killed by Cost Cutting

By Sally C. Pipes

British officials confirmed in January that as many as 1,200 people died needlessly at a government-run hospital in Stafford, a city in western England.

 

According to the government’s official report, Britain’s National Health Service was so fixated on “protecting ministers from political criticism” that it resorted to denying patients critical care as “nurses and doctors were put under pressure by managers to ensure official [cost-cutting] targets were achieved, even when that meant patients were put at risk―leading to the deaths.”

 

Think these kinds of health care horror stories can’t happen here in the United States? Think again. Several aspects of the Affordable Care Act bear a striking resemblance to the very National Health Service programs that have rationed health care―and led to so many unnecessary deaths.

 

In Britain, a government agency, the National Institute for Health and Clinical Excellence (NICE), conducts “comparative-effectiveness” research, which attempts to determine the relative effectiveness of treatments for particular conditions by pitting them against one another.

 

This research is not unbiased. It can only generate results for the average patient, and thus ignores the reality that different treatments may have different effects upon different people. NICE also routinely uses cost as a factor when deciding whether a treatment is effective. So it’s constantly making judgments about whether a particular therapy is worth the extra expense―even if it works better than an alternative. This past December, for instance, NICE declined to pay for a proven ovarian-cancer drug it deemed too expensive.

 

And if a drug can clear NICE, there’s no guarantee that patients will have access to it. A recent report by Britain’s Health and Social Care Information Center found that basic treatments for everything from arthritis to cancer were routinely denied―even after they were approved by NICE.

 

It appears that the British system’s primary concern is cutting costs―patient welfare be damned.

This barbaric system has some high-profile admirers, including some of ObamaCare’s champions. For instance, Donald Berwick, administrator of the Centers for Medicare and Medicaid Services during President Obama’s first term, has supported bringing NICE’s rationing to the United States, saying, “NICE is extremely effective and conscientious.”

 

ObamaCare puts in place many of the building blocks of the British health care system. For instance, the United States is about to institute its own version of NICE: the federally chartered Patient-Centered Outcomes Research Institute (PCORI).

 

PCORI will underwrite government-sponsored comparative-effectiveness research. The agency’s supporters claim that it will simply provide doctors with information about which treatments work best.

 

Indeed, PCORI says that it “will ensure that its research is construed as mandates for practice guidelines or coverage recommendations.” The health care economist Jason Shafrin has described PCORI as “like the UK’s NICE but without any teeth.”

 

But if PCORI seems toothless now, that will quickly change as costs increase. ObamaCare explicitly states that these supposed limits should “not be construed as preventing the Secretary from using evidence or findings from such comparative clinical effectiveness research in determining coverage, reimbursement or incentive program.”

 

Once PCORI starts issuing recommendations―and the agency just recently handed out $40 million in tax money for CER―ObamaCare’s Independent Payment Advisory Board (IPAB) might well act on them.

 

IPAB is comprised of 15 unelected bureaucrats charged with reining in Medicare spending if it exceeds GDP growth plus 0.5 percent. IPAB’s recommendations automatically become law unless Congress comes up with equivalent spending reductions elsewhere. Even though the board is supposed to start work in late April, none of the 15 has been appointed yet.

 

Supporters of IPAB point out that the board is forbidden from reducing benefits or raising fees. But IPAB can create payment incentives that will determine the behavior of health care providers. In other words, IPAB may not be able to prohibit doctors from prescribing certain treatments, but it can ensure that they lose money when they do. That’s rationing by another name.

 

Fortunately, the House of Representatives recently approved a “rules package” stipulating that it won’t follow ObamaCare’s orders to expedite IPAB’s Medicare cuts through Congress. This is a good start for eventual repeal of the Affordable Care Act―undermining its most disastrous parts before they do any real damage. But unless Congress does more to stop ObamaCare, rationing―with all of its deadly consequences―is inevitable.

 

Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. Her latest book is The Pipes Plan: The Top Ten Ways to Dismantle and Replace ObamaCare.

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Wanted: More Life with Parents, Not Government Preschool

In his February 12 State of the Union address, President Obama called for another “universal” government program―universal preschool.

“…[N]one of it will matter unless we also equip our citizens with the skills and training to fill those jobs.

“And that has to start at the earliest possible age. You know, study after study shows that the sooner a child begins learning, the better he or she does down the road.

“But today, fewer than three in ten 4-year-olds are enrolled in a high-quality preschool program. Most middle-class parents can’t afford a few hundred bucks a week for private preschool. And for poor kids who need help the most, this lack of access to preschool education can shadow them for the rest of their lives. So, tonight, I propose working with states to make high-quality preschool available to every single child in America.”

Never mind that the federal budget today cannot possibly pay for universal preschool, or that it’s not the role of government to provide glorified daycare for every American child.

The truth is, the government has been trying to close the “preschool gap” for more than forty years, with almost nothing to show for it. For years, the Head Start program, begun by President Johnson in 1965, has been known to be a failure by both academic and social development standards.

According to Elise Hilton of the Acton Institute, “[e]ven the government knows this is true. The Department of Health and Human Services has admitted ‘by third grade, the $8 billion Head Start program had little to no impact on cognitive, social-emotional, health, or parenting practices of participants. On a few measures, access to Head Start had harmful effects on children.’”

Let’s not go farther down that road. We don’t need every American child spending more time in classrooms, younger and younger. We need an economy that empowers parents both to support their families and to spend time with their toddlers, letting them experience the wonders of the real world. More kids need to be able to explore life with Mom and Dad. Then more of them will come to grade school ready to learn.

Kathryn Hickok is Publications Director and Director of the Children’s Scholarship Fund-Portland program at Cascade Policy Institute.

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Life, Liberty, and Obama’s Pursuit of Free Birth Control

The U.S. Department of Health and Human Services has released the long-awaited “accommodation” on the so-called “contraceptive services mandate.” The mandate requires nearly all employers to provide birth control, “morning-after” and “week-after” pills, and sterilization without copayments in their employee health care plans. According to the Obama Administration, the revised HHS rule requires employees of objecting religious organizations to be offered “no-cost contraceptive coverage through separate individual health insurance policies” issued through insurance companies or a third-party administrator.

Jim Towey, president of Ave Maria University, which has brought a lawsuit against the mandate, called the rule a “bizarre, new bureaucracy to obscure who exactly is paying for the abortion-inducing drugs and other services covered by the mandate.”

This is an important point for civil libertarians. Pharmaceutical companies will not provide a lifetime supply of free contraceptives to every American woman over the age of twelve out of the goodness of their hearts. The costs will be borne by individual policyholders, for-profit businesses, nonreligious nonprofits, and taxpayers―any of whom may object, and none of whom qualify for exemption.

President Obama pays lip service to the First Amendment and champions freedom of choice, but if he truly respected either, he would stop trying to create a universal entitlement to free birth control. The American way is a thriving marketplace where people can choose health care providers and coverage consistent with their beliefs. It looks as if we’ll get court battles instead.

Kathryn Hickok is Publications Director at Cascade Policy Institute, Oregon’s free market public policy research organization, and a graduate of the University of Portland.

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In 2013, Millions of Americans Face ObamaCare Tax Hikes

By Sally C. Pipes

As part of the negotiations over the fiscal cliff, Congress and President Obama are battling over whether to raise marginal tax rates at the very top of the income ladder. Regardless of how these talks turn out, millions of Americans are already facing tax hikes thanks to ObamaCare.

ObamaCare’s authors chose to offset about half of the trillion-dollar cost of the law through higher taxes. Since the Supreme Court upheld the law’s individual mandate and allowed states to opt out of its Medicaid expansion, though, the cost estimate has swelled to $1.76 trillion between 2012 and 2021.

In 2013, a number of ObamaCare’s taxes will go into effect. Each will increase the cost of health care, yield job losses, and deprive our struggling economy of investment. These are the true costs of ObamaCare. Let’s look at some of these taxes individually.

On January 1, 2013, a 2.3-percent excise tax on the gross sales of medical-device companies—regardless of whether they turn a profit or suffer a loss—will take effect. The tax will hit everything they sell, from x-ray machines and pacemakers to surgical tools and artificial hips. The levy could extract as much as $29 billion over the next 10 years.

That money will have to come from somewhere; device firms won’t simply swallow the tab. So they’ll likely raise prices for patients and slash their workforces. In fact, economists at the Manhattan Institute project that the tax could eliminate as many as 43,000 jobs—and over $3.5 billion in employee compensation.

The industry currently employs about 400,000 people and supports roughly 2 million manufacturing jobs. With unemployment—particularly in the manufacturing sector—still a national concern, it makes little sense to penalize device firms.

Because of the tax, medical-device firms will also have less money to invest in research and development. My colleague Benjamin Zycher estimates that the industry will scale back investment in new products by 10 percent through 2020. That translates to a $2-billion decrease per year.

House Republicans have been trying to repeal the tax for some time. In recent weeks, they’ve gotten some unlikely company—from Senate Democrats. In January, 16 Democrats from the upper chamber urged President Obama to delay the tax’s implementation because of the risks it poses to the industry. In a statement, Senator Al Franken (D-Minn.) described it as a “job-killing tax.”

Even an 11-figure tax like the device levy will only cover a paltry share of ObamaCare’s total bill. A much larger portion is scheduled to come from higher taxes on top earners. Individuals with annual incomes higher than $200,000 and couples who make more than $250,000 a year will face two new taxes: a 0.9-percent increase in the 1.45-percent Medicare levy on earnings above those income thresholds, and a new 3.8-percent tax on investment income. Together, these two taxes are expected to raise about $318 billion over the next decade, roughly half of the law’s new tax revenue.

The structure of these taxes penalizes married couples in particular. According to the New York Times, two unmarried singles who made $200,000 each would not owe any additional Medicare tax. But if they were married, they’d owe $1,350.

Meanwhile, the 3.8-percent tax on unearned income, like capital gains, dividends, and interest, will discourage saving and investment. That’s the exact opposite of what Congress should be doing now, with the economy still stalling.

ObamaCare’s tax hikes aren’t just confined to the rich. The law raises the floor for the deduction of medical expenses, from 7.5 percent of income to 10 percent. Therefore, only expenses beyond 10 percent of a person’s income will be deductible. This change could add hundreds of dollars to the tax bills of those struggling with major medical bills.

ObamaCare also halves the maximum contribution to flexible spending accounts (FSAs), from $5,000 to $2,500. Many consumers use FSAs to cover routine medical expenses, like vision care, orthodontia, and prescription drugs. They won’t have nearly as much money to work with in 2013.

By neutering FSAs, ObamaCare deprives patients of control over their own health care—and puts insurers and government in the driver’s seat. Instead of paying for routine care with pretax dollars, individuals will have to purchase expensive insurance that covers routine care. In the end, patients may end up paying more.

These are just the five taxes scheduled to kick in this year. In 2014, another multibillion-dollar round of taxes will go into effect, including an excise tax on high-value insurance plans, a levy on health insurers, and the individual mandate’s “tax” on people who remain uninsured.

The money to pay for ObamaCare’s health care overhaul, which will be in excess of $1 trillion and probably upwards of $2.5 trillion from 2014 to 2023, has to come from somewhere. In the New Year, Americans will find that “somewhere” is their wallets.

Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. Her latest book is The Pipes Plan: The Top Ten Ways to Dismantle and Replace ObamaCare.

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Women’s 2012 “Pocketbook Issue”—Free Contraception?

Common sense should intuit that suppressing the healthy operations of a normal human body is not “preventive” medicine. One might also think it could be an offensive political point to call doing so requisite for women’s workplace advancement. However, the Department of Health and Human Services and President Obama think otherwise. Many women disagree with them.

 

The Affordable Care Act’s contraceptive services mandate requires all insurers to provide as “preventive care,” and without cost to the user, every FDA-approved method of female birth control, potentially abortifacient “morning-after” drugs, and surgical sterilization. In keeping with contraception’s new status as “preventive care,” President Obama recast it as a women’s workplace equity issue during the October 16 presidential debate. He further concluded that not having to pay the bills for their personal choices is an important economic issue for American women:

 

“Now, there are some other issues that have a bearing on how women succeed in the workplace. For example, their health care….In my health care bill, I said insurance companies need to provide contraceptive coverage to everybody who is insured. Because this is not just a—a health issue, it’s an economic issue for women. It makes a difference. This is money out of that family’s pocket….

 

“That’s a pocketbook issue for women and families all across the country.”

 

“Preventive care” guards against diseases or disorders. In contrast, contraception, sterilization, and abortion suppress the normal functioning of a healthy reproductive system or end a pregnancy already begun. Therefore, these services are not preventive care―unless women’s fertility is considered a disorder, and pregnancy a disease. This is a medically inaccurate and denigrating way to think about women and babies.

 

Does it not offend women that government policymakers believe that contraception is considered matter-of-course for achieving career success today and so, by big-government logic, it must be provided to them for free? Fertility and motherhood shouldn’t be considered incompatible with women’s success. Women need workplace policies that accommodate their nature, as opposed to requiring them to imitate men’s. Suggesting otherwise means policymakers think women can’t be women and live a successful 21st century life.

 

Women are diverse, and no one can speak for all women. However, free birth control is most likely not the fundamental “pocketbook issue” facing American women and their families. Many other things, however, could be. To succeed in the workplace and to care for their families, women need the freedom to make responsible choices in every aspect of life.

 

For both women and men to succeed in life and to support their families, government should facilitate an economic and cultural climate in which people can start and expand businesses, try new ideas, find solutions to problems, and keep more of their own hard-earned money. Government should reduce burdensome regulations, lower taxes and fees, refrain from wasting taxpayer funds, and reform entitlement programs that discourage responsibility and encourage multigenerational government dependence. Those are pocketbook issues for American women.

 

Access to affordable quality education is another. In the new movie Won’t Back Down, Jamie (Maggie Gyllenhaal), a low-income mother, wants to stop her daughter from failing in school. In a key scene, she states with determination, “Have you heard about those mothers that lift one-ton trucks off their babies? They’re nothing compared to me.” Women want to send their children to the schools they, not the government, believe are best for them. They want schools to expect excellence, to reinforce their values, and to prepare kids to lead lives of integrity and generosity.

 

Stable families are the ultimate women’s economic issue. A widely cited Brookings Institution study demonstrates that those who graduate from high school, get a job, and marry before having children almost never live in poverty (98%). Brookings’ Ron Haskins recently testified before Congress, “In 2009, the poverty rate for children in married-couple families was 11.0 percent. By contrast, the poverty rate for children in female-headed families was 44.3 percent. The difference between these two poverty rates is a specter haunting American social policy….” Government cannot replace the family as the basic unit of a healthy, upwardly mobile society. A welfare check is a Band-Aid, not a substitute for proactive and responsible decision-making between a woman and a man, marriage, and breadwinning parents in the home. Ever-expanding government programs have not produced the “Great Society,” and free “morning-after” pills don’t mend broken hearts or unhealthy relationships.

 

Women want their daughters to aspire to life-long love and commitment, to nurture high expectations for themselves and their boyfriends, and to create a good environment into which to bring their children. Some also would prefer to spend less time in the paid workforce and more at home with their children. Breathless political rhetoric about a new contraception entitlement is out of touch with women who eagerly hope that soon they and their husbands can afford to have a baby. Higher take-home pay, rather than free birth control, empowers individual women to bring about their unique personal dreams.

 

Women’s aspirations and concerns are not for themselves alone but for all those they love―spouses, children, parents, friends―who need economic and educational opportunities today. Public figures should stop reinforcing the insulting (and false) narrative that women’s economic and social advancement depend on free contraception. They also might reflect on that ancient truth about government promises of which the poet Samuel Johnson hauntingly wrote: “How small, of all that human hearts endure, / That part which laws or kings can cause or cure!”

 Kathryn Hickok is Publications Director at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Hospital Apologizes, PDC Repeats the Tragedy

Last Friday, Legacy Emanuel Hospital held a breakfast to apologize to the North Portland community for bulldozing nearly 300 homes and businesses 40 years ago. Hospital administrators conspired with Portland urban renewal officials to secretly plan a 55-acre expansion in the Albina neighborhood. By the time affected property owners were informed, the final decision had been made. The city used its powers of eminent domain to seize all private property within the district, destroying a vibrant African American community.

Hospital officials now admit they were wrong and promise never to do it again. Unfortunately, their colleagues at the Portland Development Commission (PDC) haven’t learned the same lesson. PDC is teaming up with TriMet to build the Portland-Milwaukie light rail line. Sixty-eight businesses and twenty residences will be destroyed to make way for the slow train, at a taxpayer cost of $1.5 billion.

This is a tragic waste of money, time, and energy. The Portland-Milwaukie corridor is already served by five TriMet buses, including express and local service. There will be no public benefits to the light rail line, yet 88 private buildings will be lost.

If urban renewal officials refuse to learn from experience, we should take away their powers. The State of California did this last year when it abolished all urban renewal districts. Oregon should do the same when the legislature convenes in 2013.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Policy Judgment on Health Care Law “Is Reserved to the People”

By Jason Mercier

The Affordable Care Act is constitutional in part and unconstitutional in part.”

With these words, the Chief Justice of the U.S. Supreme Court John Roberts, in a 5-4 decision, removed the policy fate of the federal health care law from the hands of judges and placed it squarely in the lap of voters this fall to decide what happens next.

Depending on your perspective, Roberts’ decision was either an example of judicial restraint or, as the four Supreme Court Justices who dissented wrote, “carries verbal wizardry too far, deep into the forbidden land of the sophists.”

Either way, the Chief Justice repeatedly made it clear that the Court was not passing judgment on the “wisdom or fairness” of the federal health care law or if it “embodies sound policies.”

Roberts explained, “Members of this Court are vested with the authority to interpret the law; we possess neither the expertise nor the prerogative to make policy judgments. Those decisions are entrusted to our Nation’s elected leaders, who can be thrown out of office if the people disagree with them. It is not our job to protect the people from the consequences of their political choices.”

Perhaps it should be no surprise that a vast law that has deeply divided the country and barely passed Congress on a party-line vote would be decided by just one vote in a 5-4 opinion by the Supreme Court.

It is also somewhat fitting that the law about which then-Speaker of the House Nancy Pelosi said Congress “[has] to pass the bill so you can find out what’s in it, away from the fog of controversy” would contain a tax on Americans who don’t buy a product the government wants them to, which no one knew was in the bill until the Supreme Court ruled on it.

This, despite the promises made by President Obama proclaiming to the public that he “absolutely reject that notion” that the proposed health insurance mandate was a tax. Despite these public statements, the President did, in fact, argue to the Court that the mandate was a tax (after first telling the Court it wasn’t on the first day of arguments). This two-faced defense of the law proved to be its saving grace, as otherwise the Court would have tossed the individual mandate and the law as a violation of the Commerce Clause.

After winning the legal debate by arguing the health insurance mandate was instead a tax, the President is back to telling the American people it isn’t a tax but a penalty. The White House proclaimed after the Court’s 5-4 ruling, “It’s a penalty, because you have a choice. You don’t have a choice to pay your taxes, right?”

The one choice we do have is to decide what happens next.

Some would have the Court’s decision be the last word on the policies of the federal health care law. While it is in the legal sense, to paraphrase Winston Churchill, the Court’s decision is not the end. It is not even the beginning of the end; but it is, perhaps, the end of the beginning of the policy debate.

Placing the ultimate decision on the fate of the federal health care law back in the hands of voters, Chief Justice Roberts wrote, “The Framers created a Federal Government of limited powers, and assigned to this Court the duty of enforcing those limits. The Court does so today. But the Court does not express any opinion on the wisdom of the Affordable Care Act. Under the Constitution, that judgment is reserved to the people.”

This November, we the people will have the opportunity either to affirm the policies of the federal health care law or to pursue a different direction.

Jason Mercier is director of the Center for Government Reform at Washington Policy Center in Olympia and a guest contributor for Cascade Policy Institute, Oregon’s free market public policy research center. Washington Policy Center’s 10th Annual Health Care Conference on July 10 will focus on the next steps for state policymakers on implementation of the Affordable Care Act.

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Supreme Court Upholds Constitutionality of ObamaCare – Not its Efficacy

“The U.S. Supreme Court’s ruling that most of the Patient Protection and Affordable Care Act (ObamaCare) is constitutional means that Congress now has power to do virtually whatever it wants,” says Steve Buckstein, Senior Policy Analyst and founder of Cascade Policy Institute, Oregon’s free-market think tank. “But having the power to write health care rules and actually improving our health care system are two very different things.”

“By finding that the individual mandate cannot stand under the Commerce Clause, but can stand when looked at as a tax, the Court essentially seems to be telling Americans that while Congress cannot control every aspect of our behavior, it has virtually unlimited powers to tax us and spend the money as it sees fit.”

“Moving more control over health care to Washington, D.C. means that Oregonians, and citizens of every state, will have even less control over our own health care decisions. Big, centralized government systems mean higher costs, less access and less innovation in one of the most important areas of our lives,” Buckstein added.

Buckstein concluded that, “Now that the Court has failed to limit the role of the federal government in health care, it is up to Congress and the states to try to do so. The better chance for a lasting health care system fix involves empowering patients rather than marginalizing them. It involves giving them choices, and letting them do the inevitable rationing themselves, even if part of the money comes from public sources.

“Today’s Court decision was a step in the wrong direction, but Cascade Policy Institute will continue working to reaffirm that in America personal liberty is a cornerstone, not an afterthought, of our way of life.”

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Supreme Court Strikes Down ObamaCare Individual Mandate

The U.S. Supreme Court ObamaCare decision reinforces what British researcher John Spiers told Oregonians when he came here to study the Oregon Health Plan in 1999:

Political fixes in health care come unfixed fast.

They came unfixed for The Oregon Health Plan as pressure groups succeeded in eviscerating its rationing scheme, and they came unfixed for ObamaCare today as the highest court in the land struck down its centerpiece, the individual mandate.

Oregonians should be happy that the Supreme Court ruled as it did. After all, it was just six years ago that the Court sided with the state against the federal government in a health care regulatory case. In Gonzales v. Oregon (2006), the Court upheld Oregon’s “right-to-die” law, approved twice by Oregon voters. The U.S. Attorney General argued that federal law pre-empted the state law.

The Court disagreed and found that states generally have wide discretion in regulating health and safety, including medical standards. Finding that the Bush Administration’s reading of the federal statute would mark “a radical shift of authority from the States to the Federal Government to define general standards of medical practice in every locality,” the Court ruled that Oregon could protect the rights of its citizens, at least in this specific instance.

ObamaCare is a far broader “radical shift of authority from the States to the Federal Government.” By striking down its most onerous feature, the individual mandate, the Court recognized a bright line protecting every American against an overreaching federal government that tried to force us to purchase health insurance against our will. Any perceived reduction in health care benefits is far outweighed by the restoration of our personal liberty that the Court affirmed today.

The rest of ObamaCare is still an overreach by the federal government, even if the Court didn’t find it unconstitutional. The better chance for a lasting health care system fix involves empowering patients rather than marginalizing them. It involves giving them choices, and letting them do the inevitable rationing themselves, even if part of the money comes from public sources. And, again, it involves reaffirming that in America personal liberty is a cornerstone, not an afterthought, of our way of life.

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Supreme Court Strikes Down ObamaCare

The U.S. Supreme Court ObamaCare decision reinforces what British researcher John Spiers told Oregonians when he came here to study the Oregon Health Plan in 1999:

Political fixes in health care come unfixed fast.

They came unfixed for The Oregon Health Plan as pressure groups succeeded in eviscerating its rationing scheme, and they came unfixed for ObamaCare today as the highest court in the land struck it all down including its centerpiece, the individual mandate.

Oregonians should be happy that the Supreme Court ruled as it did. After all, it was just six years ago that the Court sided with the state against the federal government in a health care regulatory case. In Gonzales v. Oregon (2006), the Court upheld Oregon’s “right-to-die” law, approved twice by Oregon voters. The U.S. Attorney General argued that federal law pre-empted the state law.

The Court disagreed and found that states generally have wide discretion in regulating health and safety, including medical standards. Finding that the Bush Administration’s reading of the federal statute would mark “a radical shift of authority from the States to the Federal Government to define general standards of medical practice in every locality,” the Court ruled that Oregon could protect the rights of its citizens, at least in this specific instance.

ObamaCare was a far broader “radical shift of authority from the States to the Federal Government.” By striking it all down, including the onerous individual mandate, the Court recognized a bright line protecting every American against an overreaching federal government that tried to force us to purchase health insurance against our will. Any perceived reduction in health care benefits is far outweighed by the restoration of our personal liberty that the Court affirmed today.

The better chance for a lasting health care system fix involves empowering patients rather than marginalizing them. It involves giving them choices, and letting them do the inevitable rationing themselves, even if part of the money comes from public sources. And, again, it involves reaffirming that in America personal liberty is a cornerstone, not an afterthought, of our way of life.

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Obamacare: Pain or Prescription for College Students’ Ailing Futures?

By Rebecca Phillips

Have you ever heard of someone waiting 18 months to get an MRI?

It’s a frequent scenario in Canada, a country that is noticeably free in most respects. The exception is health care, which is controlled by the government.

But waiting 18 months for an MRI rarely happens in the United States. In fact, I’d go out on a limb and say it’s never happened in the United States…yet. This week, a crucial event is taking place whose outcome very well could be the difference between waiting 18 months or 18 minutes for an MRI. The United States Supreme Court has begun to hear the long-awaited arguments on the Patient Protection and Affordable Care Act, popularly known as “Obamacare.” The Court is expected to rule in June.

It may be easy for college students to support Obamacare based on the idea that free health coverage for those who currently can’t afford it is a good thing or even a “right.” But according to John R. Graham, Director of Healthcare Studies at Pacific Research Institute, there’s poison in that prescription.

“A ‘right’ to healthcare is a positive freedom,” Graham said, “meaning that people (doctors, nurses, etc.) must give things to you for free. That requires government enforcement.”

In other words, the federal government takes control of your access to health care. It may sound harmless at first, but there is real-world evidence to suggest otherwise. Graham highlighted Canada, where the government has controlled access to health care for the past 40 years. The goal was to grant equal access to health care. The reality is equal denial. There is a lack of access to health care resources across the board. Patients have extreme difficulty seeing a specialist or even a primary care physician. OB/GYNs hardly exist. And receiving tests or treatments often takes exorbitant amounts of time.

Under Obamacare, these inefficiencies will become a very real threat to our own access to health care. “Obamacare is not an equilibrium,” explained Graham. “Government will need – and want – more control. It would eventually become a single-payer system.”

In college, with tests and parties and internships occupying your time, it can be difficult to envision the impact Obamacare would have on your immediate and long-term future. But college students, of all demographics, should be among the most concerned. Obamacare places a huge financial burden on businesses through taxes tying up funds that otherwise could be used to hire or to invest. If you think it’s difficult to find a job now, it will be significantly more difficult under Obamacare’s full implementation. Free health care sounds nice right now, but will it retain its luster when so many students have degrees and student loans but no job because businesses can’t afford to hire?

Ironically, one only has to look at the medical field for evidence. As Graham pointed out, these medical industries already suffer from heavy taxes – so much so that layoffs are gaining prevalence in medical professions from clinicians to research scientists. Students looking to enter the medical field will face an even bleaker job market under Obamacare.

There’s also your own health to consider. Forty or fifty years from now, you likely will need more substantial medical care than you have needed in your teens and twenties. Will you want to face the same time and resource constraints that accompany government-controlled access to health care? Even 10 years from now, you may hesitate to start a family because specialized prenatal and OB/GYN care isn’t as readily available.

A “right” to health care may sound like a good idea, but what about the government having a “right” to tell you what you do or do not have access to – whether that’s medical care, a job, or a family? It has been said that a government big enough to give you everything you want is big enough to take away everything you have. Obamacare may force providers to expand their coverage on paper, but no one can promise you will get the treatment you need or the services you want – just look at Canada.

In the real economy, there is no such thing as “free” – it’s paid for by someone or not provided at all. When we cede individual control of our health care decisions to the government, the government decides who pays for what care, how much they will pay, who will get benefits, and when they will get treatment. When you are waiting 18 months for an MRI, the cost of “free” will be awfully high.


Rebecca Phillips is Student Freedom Project Coordinator at the Freedom Foundation in Olympia, Washington. She is a recent graduate of Berry College, Georgia, and a guest contributor for Cascade Policy Institute, Oregon’s free market public policy research center.

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Federal Health Care Reform: A Two-Year Report Card

By Roger Stark, MD, FACS

Major health care reform (Patient Protection and Affordable Care Act) became law two years ago. The legislation passed with only Democratic votes and totaled a massive 2,700 pages. The Medicare and Medicaid programs, by contrast, were enacted in 1965 with broad support from both parties and totaled only 137 pages. Although the 2010 PPACA will not be fully implemented until 2018, we know much more about it today than was apparent two years ago.

The American public continues to view the law unfavorably. The weekly Rasmussen poll consistently shows a firm majority of Americans, 52 to 60 percent, favor repeal. A recent poll by the Kaiser Foundation reveals 51 percent of the public views the law unfavorably. The CNN polling organization found that 59 percent of Americans oppose the law and only 39 percent support it.

Before passage, Americans were told the law would decrease health care costs for the country. The nonpartisan Congressional Budget Office (CBO) estimated the original cost of the legislation would be less than $1 trillion and would reduce the deficit by $100 billion in the first ten years. These numbers were based on the government collecting ten years of taxes and providing only six years of benefits. CBO officials now believe the first ten years will cost Americans at least $1.5 trillion and will add another $700 billion to the deficit.

The chief Medicare actuary, Richard Foster, estimates PPACA will increase overall health care spending from 17 percent of the economy to 21 percent by 2020. Foster also calculates that insurance premiums will increase by $2,100 per year on average because of PPACA. One of the architects of the law, Jonathan Gruber (an M.I.T. economist), recently stated that the law will “dramatically increase” insurance premiums.

The second ten years of the law, from 2020 to 2029, will be even worse. There will then be ten years of taxes collected to pay for a full ten years of benefits. There will be no four-year revenue buffer by then. Cost estimates for the second and subsequent ten-year periods run as high as $2.5 to $3 trillion and will add untold billions to the national deficit. So much for holding the cost of health care down.

The President told Americans we could keep our present health insurance if we liked it. A recent national survey, however, found that 50 percent of small business employers and 30 percent of large employers will definitely drop or would consider dropping employee health benefits. The CBO now estimates that at least 14 million Americans will lose their employer-provided health insurance under PPACA.

Proponents of the PPACA guaranteed the law would cover health insurance for every American. Estimates now predict that at least 20 million people will remain uninsured.

To date, the federal government has provided over 1,200 waivers, or customized repeals, to businesses, labor unions and other organizations, allowing them to opt out of part or all of the PPACA. Yet the law forces states to add 16 to 23 million more people to the budget-breaking Medicaid program.

Proponents of the law point out that millions of young adults under 26 years old have been added to their parents’ health insurance plans. Of course, the impact on improving the nation’s health is minimal. These young people for the most part don’t require health care.

Proponents also argue that small businesses now have access to tax credits for employee health insurance. Because of very specific requirements and a huge regulatory burden, only five percent of eligible employers have actually used these credits.

In reality employers face a very uncertain future. In a recent Gallup Poll, nearly 85 percent of small business employers are not hiring now because of fears about regulations and the cost of health benefits required in the new law.

The PPACA has become increasingly unpopular since it passed two years ago. Experience with the law and concerns about the future make this growing unpopularity warranted.

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Federal Health Care Reform: A Two-Year Report Card

Major health care reform (Patient Protection and Affordable Care Act) became law two years ago. The legislation passed with only Democratic votes and totaled a massive 2,700 pages. The Medicare and Medicaid programs, by contrast, were enacted in 1965 with broad support from both parties and totaled only 137 pages. Although the 2010 PPACA will not be fully implemented until 2018, we know much more about it today than was apparent two years ago.

The American public continues to view the law unfavorably. The weekly Rasmussen poll consistently shows a firm majority of Americans, 52 to 60 percent, favor repeal. A recent poll by the Kaiser Foundation reveals 51 percent of the public views the law unfavorably. The CNN polling organization found that 59 percent of Americans oppose the law and only 39 percent support it.

Before passage, Americans were told the law would decrease health care costs for the country. The nonpartisan Congressional Budget Office (CBO) estimated the original cost of the legislation would be less than $1 trillion and would reduce the deficit by $100 billion in the first ten years. These numbers were based on the government collecting ten years of taxes and providing only six years of benefits. CBO officials now believe the first ten years will cost Americans at least $1.5 trillion and will add another $700 billion to the deficit.

The chief Medicare actuary, Richard Foster, estimates PPACA will increase overall health care spending from 17 percent of the economy to 21 percent by 2020. Foster also calculates that insurance premiums will increase by $2,100 per year on average because of PPACA. One of the architects of the law, Jonathan Gruber (an M.I.T. economist), recently stated that the law will “dramatically increase” insurance premiums.

 

The second ten years of the law, from 2020 to 2029, will be even worse. There will then be ten years of taxes collected to pay for a full ten years of benefits. There will be no four-year revenue buffer by then. Cost estimates for the second and subsequent ten-year periods run as high as $2.5 to $3 trillion and will add untold billions to the national deficit. So much for holding the cost of health care down.

The President told Americans we could keep our present health insurance if we liked it. A recent national survey, however, found that 50 percent of small business employers and 30 percent of large employers will definitely drop or would consider dropping employee health benefits. The CBO now estimates that at least 14 million Americans will lose their employer-provided health insurance under PPACA.

Proponents of the PPACA guaranteed the law would cover health insurance for every American. Estimates now predict that at least 20 million people will remain uninsured.

To date, the federal government has provided over 1,200 waivers, or customized repeals, to businesses, labor unions and other organizations, allowing them to opt out of part or all of the PPACA. Yet the law forces states to add 16 to 23 million more people to the budget-breaking Medicaid program.

Proponents of the law point out that millions of young adults under 26 years old have been added to their parents’ health insurance plans. Of course, the impact of improving the nation’s health is minimal. These young people for the most part don’t require health care.

Proponents also argue that small businesses now have access to tax credits for employee health insurance. Because of very specific requirements and a huge regulatory burden, only five percent of eligible employers have actually used these credits.

In reality employers face a very uncertain future. In a recent Gallup Poll, nearly 85 percent of small business employers are not hiring now because of fears about regulations and the cost of health benefits required in the new law.

The PPACA has become increasingly unpopular since it passed two years ago. Experience with the law and concerns about the future make this growing unpopularity warranted.

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Steve Buckstein talks with Mark and Dave about cold medicine report

KEX 1190 radio hosts Mark and Dave interview Cascade founder Steve Buckstein about Cascade’s report on the effects of Oregon requiring prescriptions for pseudoephedrine (PSE) on the number of meth labs in the state.

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Cold Medicine Prescriptions Have Not Reduced Meth Lab Incidents or Use in Oregon

The production and use of methamphetamine—a highly addictive drug often made with store-bought ingredients—continues to be a serious problem for many states around the country, including Oregon.

Curbing meth’s negative impacts on communities, individuals, and families is an important societal goal; and it is understandable why our state legislators sought to do something about it in 2005.

That year, Oregon adopted a law that included a prescription requirement for what were then over-the-counter medicines containing pseudoephedrine (PSE), such as Advil Cold & Sinus, Claritin-D, and Sudafed. Because PSE is also an ingredient used in the manufacture of meth, the idea behind the prescription requirement was to keep it out of the hands of meth cooks.

The problem is that since 2006, law-abiding Oregonians have had to obtain a prescription to treat minor cold or seasonal allergy symptoms, something consumers in 48 other states don’t have to bother with.

As a result, responsible Oregonians are now forced to take time off work, call a doctor, visit a hospital or clinic, and pick up a prescription—just to buy a box of Mucinex-D. Not only is that a significant hassle for most people, it also leads to higher health care costs, involuntary time away from work for individuals, and lower productivity for Oregon businesses.

Putting aside these considerable burdens, Cascade Policy Institute set out to determine whether the prescription mandate actually has been successful in reducing meth’s impact on the state.

Our study looked at meth trends in Oregon from 2004 to 2010 and compared what was happening here to similar states and the country as a whole. We found that while the number of meth lab related incidents in 2010 is down 97% from 2004, that doesn’t speak to the success of the prescription requirement.

Why not? Because six nearby states that don’t have a prescription requirement, including Washington State and California, experienced similar declines in meth lab incidents. In addition, almost all of Oregon’s 97% drop occurred between 2004 and 2006, before the prescription law even took effect.

The decline in illegal meth manufacturing also has not corresponded to a decline in meth use or availability in Oregon. The sad fact is that the reduction of one source of methamphetamine only leads to the increased availability of the drug from other sources, including Mexican super labs.

Furthermore, a new study by Jane Carlisle Maxwell of the University of Texas at Austin and Mary-Lynn Brecht of the University of California at Los Angeles found that Mexican meth manufacturers (in a country that imposed a ban on pseudoephedrine in 2008) are increasingly using alternative methods to make the drug, including the P2P method, which doesn’t rely on PSE.

In addition, Maxwell and Brecht pointed to findings from the U.S. Drug Enforcement Administration which indicate that Mexican meth cooks are also “looking to other areas in the world for the required chemicals and the ability of Asian manufacturers who use ephedrine and pseudoephedrine to produce large quantities of high quality methamphetamine which may become another source of the drug in the U.S.”

But independent of the new realities in the manufacturing of methamphetamine, Oregon’s own High Intensity Drug Area (HIDTA), reported in September 2011 that meth continues to be “highly available” and remains “the most serious drug threat in Oregon.” Maxwell and HIDTA’s findings are consistent with Cascade’s conclusions.

While legislators who voted for Oregon’s prescription requirement no doubt had good intentions, the bottom line is that it has been ineffective in achieving its intended purpose of significantly reducing meth production and use in the state.

Given that the law has fallen short of its goals, and because responsible Oregonians have been significantly affected by its prescription requirement, it’s time for Oregon lawmakers to revisit the six-year-old-law and, hopefully, repeal it.

Click here to read the full report.

 

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Press Release: Requiring a Prescription for Cold Medicine Has Not Reduced Meth Use in Oregon

Media Release
FOR IMMEDIATE RELEASE

Contact:

Steve Buckstein

Senior Policy Analyst
Cascade Policy Institute
Phone: (503) 242-0900

steven@cascadepolicy.org

February 21, 2012

Requiring a Prescription for Cold Medicine Has Not Reduced Meth Use in Oregon

Cascade Study Raises Questions about Real Impact of Oregon’s
Prescription-Only Requirement

PORTLAND, OR — Cascade Policy Institute released a study today which found the 2005 Oregon law which restricts access to medicines containing pseudoephedrine (PSE) has not made the illegal drug methamphetamine harder to get or reduced the number of people using it. The Oregon law makes any medication containing PSE available only via prescription (“Rx-only”).

“This study affirms what we predicted over six years ago: The law would not significantly curb meth use or production, but it would impose a considerable burden on legitimate users of cold and allergy medicines like Claritin-D and Sudafed,” said Steve Buckstein, Cascade’s founder and Senior Policy Analyst. “With other state and federal lawmakers considering following Oregon’s lead on this issue, we thought it was critical to find out what has actually happened here since the law went into effect.”

“The prescription requirement for cold and allergy medicines containing pseudoephedrine had no more of an impact on the reduction of meth lab incidents than other measures adopted in neighboring states. In fact, the rate of mobile meth lab reductions in Oregon is nearly identical to that of six neighboring and nearby states that do not have a prescription requirement. Moreover, meth addicts in Oregon can still get access to their drug of choice,” added Buckstein. “Overall, our study raises fundamental questions about the effectiveness of Oregon’s law and whether such a prescription mandate—which impacts all consumers in the state—is warranted.”

Key findings of the study:

  • Law enforcement in Oregon report that methamphetamine remains the state’s greatest drug threat, despite the reduction in in-state meth production, and contributes the most towards drug-related crime.
  • Methamphetamine lab incidents in Oregon declined more than 90 percent between 2004 and 2010. Most of this decline occurred before the prescription-only law went into effect in 2006.
  • Six neighboring states including Washington and California experienced similar declines in meth lab reductions without imposing a prescription requirement during the same time frame.
  • The number of methamphetamine admissions to substance abuse centers in Oregon declined about 23 percent from 2006 to 2009, the exact same rate as the rest of the United States. Usage was slightly higher in California at 29 percent and slightly lower in Washington at 20 percent.
  • Legitimate users of pseudoephedrine in Oregon incur additional costs as a result of this law, because it requires a doctor visit to get Sudafed and similar products that are available over-the-counter in 48 other states. Some of these additional costs are also borne by all taxpayers who fund government health care programs.

The first part of the study examines whether the manufacture and availability of methamphetamine in Oregon is substantially different from similar states and similar regions of the country. Part two examines trends in indicators that track methamphetamine production, such as Oregon’s lab incidents compared to other states. Part three examines trends in indicators of methamphetamine use, such as substance abuse-related admissions in Oregon compared to other geographies. And finally, part four explores the costs, financial and otherwise, to consumers.

The report’s findings are consistent with studies conducted by other independent groups, such as Oregon’s High Intensity Drug Area (HIDTA), which reported: Methamphetamine continues to be highly available and widely used throughout the HIDTA region and remains the most serious drug threat to Oregon” (“Threat Assessment & Counter-Drug Strategy,” 2011 Oregon High Intensity Drug Trafficking Areas (HIDTA) Report, Accessed 9/26/11).

Please visit the Cascade Policy Institute website to read the entire study, entitled

Making Cold Medicine Rx-Only Did Not Reduce Meth Use
Analyzing the Impact of Oregon’s Prescription-Only Pseudoephedrine Requirement

The study was conducted by Chris Stomberg, Ph.D., a Partner, and Arun Sharma, a Principal, in the Antitrust and Competition, and Healthcare practices at Bates White, LLC, an economic consulting firm based in Washington, D.C. Primary report author Chris Stomberg can be contacted at chris.stomberg@bateswhite.com or (202) 747-1421.

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Requiring a Prescription for Cold Medicine Has Not Reduced Meth Use in Oregon

A 2005 law which requires Oregonians to get a doctor’s prescription to use cold and allergy medicines containing pseudoephedrine has not significantly reduced meth lab incidents, made the illegal drug methamphetamine harder to get or reduced the number of people using it. What it has done is impose a considerable burden on legitimate users of medicines like Claritin-D and Sudafed. Anyone considering such a law in other states should read this study and avoid Oregon’s mistakes.

The study was conducted by Chris Stomberg, Ph.D., a Partner, and Arun Sharma, a Principal, in the Antitrust and Competition, and Healthcare practices at Bates White, LLC, an economic consulting firm based in Washington, D.C.

Click here to read the full report.
Click here to read the press release summary of the report.

 

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Health Care’s Newest Epidemic: Red Tape

By Douglas A. Perednia, M.D.

Here’s a riddle: What costs Americans over $12 billion per year, generates more work than the nation’s thirteenth largest employer, drives millions of doctors and patients crazy, and is growing so fast it makes kudzu look stunted? The answer: the over half-billion hours of health care paperwork mandated last year by the Department of Health and Human Services (HHS). Even before ObamaCare the burden of HHS paperwork had been doubling every six years. The sheer complexity of the health care reform law guarantees a massive increase between now and 2020.

Combined with the red tape generated by insurance companies, state governments, and a proliferation of other organizations, this administrative overhead is a major reason why the cost of health care continues to grow at a rate that dwarfs increases in the nation’s gross domestic product. Our marginal health care dollars are generating less health than ever.

These insights come to us courtesy of the Information Collection Budget of the United States, an annual report that documents the amount of time Americans must spend filling out forms at the behest of Washington bureaucrats. By far the biggest paperwork offender is the tax-levying U.S. Treasury, which accounts for 84% of the 8.8 billion hours consumed. But while Treasury paperwork has grown 25% since 1999, the amount mandated by HHS has risen by 331% – far outstripping the growth rate of any other federal agency. Unchecked, HHS will generate more paperwork than all other non-Treasury federal agencies combined by 2015.

Figure 1 shows the amount of private sector paperwork demanded by HHS, compared to the total amount required by all other non-Treasury departments. The recent drop in non-HHS paperwork is purely the result of agencies lowering their estimates of how long their paperwork takes to complete. Nevertheless, last year HHS bucked even this trend with an increase of nearly 50 million hours. Only 15 million of those were attributed to ObamaCare.

Figure 1.

Another way of looking at HHS paperwork is to express it as a proportion of all non-Treasury paperwork Americans must complete in the course of each year. This is shown in the Figure 2.

Figure 2.


The burden of paperwork required by HHS is growing so fast that it now accounts for almost 40% of all non-Treasury paperwork, dwarfing the individual contributions of agencies like the EPA, the SEC, Homeland Security, and the Department of Labor. And it seems willing to demand more information at any price. HHS is now the nation’s foremost offender with respect to the Federal Paperwork Reduction Act, with sixty-five violations in FY 2010. This is nearly 60% of the violations generated by the entire federal government.

Just how much is 542 million hours of paperwork? Imagine 271,000 people employed doing absolutely nothing other than filling out forms at the behest of HHS. If these people were all in a single private company, it would have more employees than Albertsons. At the current rate of increase, over 540,000 full-time employees would be needed by 2015. That would make HHS paperwork the second largest employer in the country, right behind Walmart. The cost to the private sector for supplying the government with all that information? Nearly $26 billion.

Most of the people doing this work are doctors, patients, and armies of administrative personnel hired by hospitals, clinics, nursing homes, and private offices to help handle the load. All of these documents are in addition to those they have to complete for literally thousands of private health insurers, disability insurers, state governments, licensing boards, and accreditation organizations. If you want to know why your insurance premiums are rising at 9% per year, this is a big part of the answer.

Why does HHS need all of this information? Quite simply, federal regulators are now struggling to control nearly every aspect of health care – from the price and distribution of hundreds of thousands of health care-related goods and services, to the benefits to be included in private health insurance policies, to exactly what procedures doctors must follow when dealing with patients who smoke. It is an impossible task. No central authority can possibly gather and process enough information fast enough to reconcile the needs of hundreds of millions of patients, providers, and medical suppliers. Free markets are efficient precisely because such information is passed along automatically, instantly, and for free in the form of prices, inventories, and demand.

HHS’s information budget should warn us that the only way to truly reduce health care costs in the long term is by dumping government controls and returning to something that looks far more like a free market in health care goods and services. The entire system needs to be drastically simplified, and fast.

To borrow a phrase from the President, we can’t wait.


Douglas A. Perednia, M.D. is a physician and senior research associate at the Cascade Policy Institute. He is author of the book Overhauling America’s Healthcare Machine: Stop the Bleeding and Save Trillions, published by Financial Times Press, and writes for the blog The Road to Hellth. Dr. Perednia is a guest writer for Cascade Policy Institute, Oregon’s free market public policy research organization.

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Personal Health Accounts Empower Medicaid Recipients

As Michael Sherraden pointed out 20 years ago in his book Assets and the Poor: A New American Welfare Policy, the key to getting ahead is not income but assets. People play better and smarter when they have a stake in the system.

According to research, assets not only provide financial security, but they cause people to lead more stable lives, think in longer time frames, be more involved in community affairs, and have more hope for the future.

While many government programs discourage asset accumulation, causing low-income individuals to miss the psychological and tangible benefits of asset building, some states are trying a new approach. South Carolina is testing personal health accounts in a pilot project for Medicaid recipients. Participants get high-deductible insurance paired with savings accounts for medical expenses that aren’t covered by insurance, all funded by Medicaid. When program recipients increase their income and no longer qualify for Medicaid, they keep the balance in their health accounts.

The program realizes the benefits that higher income individuals (and businesses) have already seen from switching to high deductible insurance paired with health savings accounts: People make smarter decisions about what health care they need or want when they have “skin in the game.” That “skin” is the balance of their health savings account.

Isn’t it time that Oregon think outside the box to incorporate asset building into its safety nets?

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A Health Clinic by Another Name…Will the Oregon Health Plan “Transformation” Work?

By Douglas A. Perednia, M.D.

Here’s a question for you. If you quietly take thousands of Oregonians hostage and then release them with great fanfare, does that make you a kidnapper or a hero? The answer, of course, depends on whether anyone remembers you kidnapped them in the first place. This happens to be exactly the scenario posed by the Oregon Health Plan’s newest innovation, the “Coordinated Care Organization,” or CCO.

CCOs are in the news because they now appear to be the state’s only strategy for saving the Oregon Health Plan (OHP). According to a recent article in The Oregonian, they are “poised to transform” health care. The CCO approach is said to “offer a glimpse of the future for the Oregon Health Plan’s 600,000 low-income and disabled people on Medicaid and Medicare.” As described in the article,

“The state budget assumes the transformed health plan will be up and running next summer—quickly enough to save $249 million in Medicaid costs in the second year of the 2011-13 biennium. If it doesn’t, the state will have to find money to fill the hole or cut Medicaid payments, already down 11 percent this year.”

Before we get too carried away with praising the solution, it’s worth recalling just how we got into this situation, who got us here, and exactly what, if anything, is “new” about CCOs.

It’s no secret that Medicaid in Oregon has been underfunded for decades. As documented by The Lund Report, depending on the contract, “…something like 60% or less of a doctor’s overhead is covered…,” and “an additional 19% cut on top of that is going to create problems with access.” Already, “[r]oughly a quarter of all primary care physicians in Oregon, and about 18% overall, refuse to accept additional Medicaid patients mainly due to low reimbursements….”

One predictable result is that large numbers of OHP patients headed to hospital emergency rooms for care. Indeed, the Oregonian article began by profiling one such patient who is now a CCO patient and advisor to the Governor’s CCO program:

“Wracked by diabetes, hypertension, asthma, spinal disease, allergies, depression and other ills, Amy Anderson felt she was near death when she found the Mid-County Health Center in 2007.

“She had lost her job and health care a year earlier and had been getting most of her health care in hospital emergency rooms. But at Mid-County in Southeast Portland, she was assigned her own team of health care providers that she saw at every visit. They got to know her; she grew comfortable with them.

“‘Any time I called, someone was there,’ says Anderson, 56. ‘I started to believe I was going to get good care.’”

That’s great, but how does the CCO do it? And what is a CCO anyway?

In basic terms, CCO is a medical clinic that has enough people, and a big enough budget, to do what any medical clinic would do if it could afford to do so: take care of its patients. Here is the Oregonian’s description:

“Each Mid-County clinic team has a doctor and family nurse practitioner, each with a clinical medical assistant; a registered nurse; a team clerical assistant; and a third clinical medical assistant to track appointments, preventative measures, prescriptions and other information for team patients.

“The team also has access to psychiatric nurse practitioners and social workers at the clinic. Team members work together in the same room and huddle twice a day….

“When a patient like Anderson shows up, the team knows her health history, her medicines she’s taking and what tests she needs. Sometimes the team will call her in for a test. She can call the team directly and often, if needed, get in to see someone on the same day.”

Doctors normally do most or all of those things for their private patients. So why don’t all doctors do this for their Medicaid patients? The answer, of course, is that they can’t. Medicaid doesn’t pay them enough to cover their basic overhead, let alone retain whole teams of social workers and administrative personnel. If it did, many doctors wouldn’t have stopped seeing Medicaid patients in the first place. Moreover, Medicaid doesn’t pay them for many of these activities (such as coordinating with other providers), at all. Adding insult to injury, Medicaid is notorious for its paperwork, administrative rules and reporting requirements. It’s not our health care providers who have failed these patients; it’s the insurance system that the government itself created.

All of which brings us back to the promised OHP transformation. Since the Oregon Health Plan’s own policies created the problem of underinsured patients who receive all of their care in emergency rooms, why should anyone expect that its new Coordinated Care Organizations will be any more successful?

It all comes down to money. CCOs are nothing particularly innovative or revolutionary. They’re just clinics with more resources than the typical clinic that accepts Medicaid patients. If the additional funding isn’t there, they will be held hostage to the same unsustainable business model that has characterized the OHP in the past.

In that event, Oregonians would do well to recall who got us into this mess in the first place.


Douglas A. Perednia, M.D. is a Portland-area physician and the author of Overhauling America’s Healthcare Machine – Stop the Bleeding and Save Trillions (Financial Times Press, 2011). He blogs at The Road to Hellth (www.roadtohellth.com). He is a guest writer for the Cascade Policy Institute, Oregon’s free market public policy research organization.

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Learning from Mistakes in Health Insurance Policy

By Michael Bastasch

The Oregon Health Plan (OHP) was implemented in 1994 as Oregon’s attempt to improve health care for the state’s low-income Medicaid population. The program set out to increase access to health coverage, ensure early preventative treatment and reduce premium increases for the insured. Despite its lofty goals, the program largely failed as financial instability forced it to impose higher costs on its own beneficiaries and to disenroll many participants.

Recently, the National Bureau of Economic Research released a controlled study analyzing the effects of “expanding access to public health insurance on the health care use, financial strain, and health of low-income adults” in Oregon. In 2008, the state expanded Medicaid enrollment by 10,000 under the Oregon Health Plan (OHP) Standard program. The Standard program covers only a limited number of uninsured adults ineligible for traditional Medicaid programs and charges monthly premiums but no copayments. This recent study has been trumpeted by some as a vindication for the national Affordable Care Act (Obamacare), but the results simply echo a return to the same failed approach to health insurance that Oregon has already experienced with the OHP.

The results of the 2008 study were as follows: There was an increase in utilization of health care services among those who received insurance. The probability of having a hospital admission increased 30%, the probability of having an outpatient visit increased 35% and the likelihood of taking any prescription drugs increased 15%. Likewise, there was an increase in reported compliance with recommended preventative care including mammograms and cholesterol monitoring.

As for financial strain, there was a 25% decline in the probability of having unpaid medical bills sent to collection agencies and a 20% decline in having to pay any out-of-pocket medical expenditures.

In terms of the benefits of insurance to physical health, the results show a 13% increase in the likelihood that someone reported feeling “good, very good, or excellent;” and the likelihood of screening positive for depression fell as well.

All of these would seem to indicate that the program was successful, yet a closer examination reveals the fundamental problems with the program. First, the increases in the utilization of health services and the reduced financial strain add significantly to overall costs. In fact, average annual individual expenditures increased by 25% ($778). This isn’t surprising, given that merely a decade after OHP was implemented expenditures per enrollee had increased 58[SB1] %. OHP’s total Medicaid expenditures increased 113% from 1994 to 2008[SB2] , well over the rate of medical inflation for that time period. These huge cost increases put heavy burdens on the system which eventually resulted in large-scale disenrollment of beneficiaries.

Second, the push for preventative care did not decrease emergency room visits or generate cost-savings. Proponents of preventative care argue that expanded public insurance should encourage preventative treatments in order to reduce health care costs as fewer people use hospital emergency rooms for preventable diseases. They believe that emergency room visits are often the most expensive form of health care provision. However, the recent study points out that there was no such decrease in emergency room use, despite the fact that compliance with recommended preventative care increased. In fact, OHP has never caused any measurable change on emergency room usage over its lifetime.

Third, self-reported measurements of health indicated improvements. However, two-thirds of the increase in self-reported health came shortly after enrollment and before enrollees began utilizing any medical services. Also, the increase in self-reported health doesn’t mean enrollees were actually physically healthier. In fact, the report indicated it is most likely that the increase in self-reported health reflects a general sense of improved wellbeing. In other words, people feel better off with insurance even if they are not physically healthier.

 

The recent study provides a clear insight into the effects of expanded public health coverage in Oregon, and the results of the study provide additional evidence to the failure of OHP. However, proponents of Obamacare see the Oregon experiment as vindication for their nationwide endeavor. Comparing Oregon’s results to the national stage is premature, as even this report’s researchers have warned: “[C]onsiderable caution must be exercised in extrapolating from our estimates of the causal impact of insurance eligibility and coverage to other settings.”

Policymakers should use the study as a blueprint for how not to go about reforming health care. The Oregon experience has shown that further centralization of health coverage and layering of subsidies ultimately fails. Instead, it would be prudent to decentralize health coverage to promote competition and consumer choice.


Michael Bastasch is a research associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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The Truth about the Canadian Health Care System

By Frank S. Rosenbloom, M.D.

President Barack Obama and supportive members of Congress were able to get the Patient Protection and Affordable Care Act (ObamaCare) passed, in part by extolling the virtues of the Canadian health care system. In speech after speech, Obama has touted the alleged lower cost, “universal coverage” and better medical care of that system. All of the mentioned supposed benefits are untrue, but the most disconcerting fact is that Mr. Obama has never discussed any deficiencies of the Canadian system.

Other influential people have shared their concerns about the serious deficiencies in the Canadian health care system. Perhaps the most important of these is the man some call the ”father” of the Canadian health care system, Claude Castonguay. Although several provinces had government involvement in health care from 1946, Castonguay was the pioneer of socialized medicine in Quebec, which gave impetus to the establishment of a nationwide socialized medical care law in 1966.

However, in 2008 Castonguay had this to say about the health care system: “If nothing is done, at one point we will reach a crisis point. This is why we say it is urgent to act. There’s no miracle solution, there is no simple solution.” He has urged some privatization in the health care system to increase choice and fees of up to $100 for doctor visits. How could this be? Haven’t we been led to believe that the Canadian health care system is financially stable? In fact, the system is close to collapse.

Let’s review the facts. The Canadian health care system was established in the 1960s, when the government was spending like a drunken sailor trying to promote economic growth. Sound familiar? The assumption was that the economy would grow at a predictable rate and that the system therefore would be affordable. However, Canadians made the same fundamental mistakes governments always make when establishing entitlement programs; that the economy would act predictably and that the program’s costs would grow in a predictable linear fashion. These two assumptions have proven to be incorrect in all cases, as they were in establishing our own Medicare system.

Health care reform has been a serious issue in Canada for over fifteen years, as the financial burdens of socialized medicine have put increasing strain on resources. Canadian media regularly trumpets fears about escalating health care costs. Furthermore, since accurate statistics are kept only on government spending, substantial hidden costs are associated with that system. Some Canadians are even breaking the law by opening private clinics to relieve a system that is imploding. One significant reason the Canadian system has lasted this long is the safety valve provided by the U.S. system, where Canadians can receive timely care at a fair price. Yet, if you believe President Obama, the Canadian health care system moves along like a well oiled machine.

Although Canadians spend less per capita than we do in the U.S., the rate of rise in their health care costs has been at times equal to or greater than ours during the past decade. So, how can we be told that Canadian health care costs are rising at a slower rate than our own? The rate of rise in Canadian health care expenditures can be seen by reviewing the widely available graph below.

 
Canadian Institute for Health Information

The graph shows total expenditures in constant 1997 dollars. A quick review shows Canadian health care costs rose about 240 percent from 1996 to 2009, by which time they actually exceeded $180 billion.

By contrast, the rise in U.S. health care costs can be reviewed below.

 
Centers for Medicare & Medicaid Services, Office of the Actuary. National Health Expenditure Accounts – Projected, Table 1: National Health Expenditures; Aggregate and Per Capita Amounts, Percent Distribution, and Average Annual Percent Growth, by Source of Funds: Calendar Years 2003-2018

We see that in 1996, U.S. health care spending was about $1 trillion. By 2009 it had reached about $2.4 trillion, which is an increase during that period of about 240%. Now, wait a minute! The rate of rise of Canadian health care costs is really no lower than ours? Yes, President Obama, (and Governor Kitzhaber), there is no Santa Claus, and no Shangri-La. The often reported, widely disproportionate cost increases between the Canadian and the U.S. health care systems are a myth.

Statistics can be adjusted to promote a particular ideology, as was seen by the graph above adjusted to constant 1997 dollars and the addition of the “projected” 2018 spending in the U.S. graph. Despite these difficulties, the truth about the Canadian health care system and socialized medicine is available to anyone who diligently studies the matter. Unfortunately, many Americans have relied on liberal politicians for their information, and nothing but higher costs and lower quality medical care will be the inevitable result. If we really want costs to decrease while maintaining quality health care, we need real free market reform before the inevitable complete collapse that will occur nationally under ObamaCare and the disaster that will befall Oregon under Gov. Kitzhaber’s reform proposals.


Frank S. Rosenbloom M.D. is a practicing physician and president of the Docs 4 Patient Care Oregon chapter. He is a guest writer for the Cascade Policy Institute, Oregon’s free market public policy research organization.

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Real Health Insurance Reform

The day after the Oregon legislature finished voting to create an Oregon Health Insurance Exchange, as required by the federal Affordable Care Act, a three-judge federal panel in Atlanta heard arguments from 26 states seeking to have the federal law declared unconstitutional. The act, better known as ObamaCare, seeks to impose sweeping changes on this country’s health insurance and health care systems. One key provision would require everyone to either purchase insurance by 2014 or face a fine.

Those 26 states argued that the federal government has no legitimate power to require individuals to purchase any product, in this case health insurance. All three judges who heard the case last Wednesday seemed at least somewhat receptive to that argument. Chief Judge Joel Dubina asked, “If we uphold the individual mandate in this case, are there any limits on Congress’ power left?” Judge Stanley Marcus wanted to know, “…[G]oing back to the first principles, is there anything out there that actually suggests that Congress can compel a private party to buy a private product on the open market if they’re not disposed to do so?”

Oregon is being offered 48 million federal dollars to set up an insurance exchange to help our citizens comply with that federal mandate. Some legislators voted for the bill because they feared that if we don’t set up an exchange on our own terms, the feds will impose a less palatable one on us when the individual mandate takes effect.

 

Whether we ever get that $48 million is open to question. The U.S. House voted not to fund such grants, but that decision may be reversed in current Congressional budget deliberations. Whether we eventually get the cash or not, Oregonians will not be well served by an exchange that only helps us purchase policies that our state insurance regulators approve. Some other states have far fewer mandates on similar policies. Many of us could save hundreds of dollars a month if only we were allowed to shop for policies approved by those states.

Any exchange Oregon sets up should increase, not maintain limits on, Oregonians’ insurance policy choices. Then, whether ObamaCare eventually gets overturned or not, our state could lead the way in helping its citizens make informed choices on a wide range of insurance products. Now that would be real insurance reform.

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BPA Fact Sheet

Despite considerable fears raised by activist groups and the press, the science does not warrant regulations on Bisphenol-A (BPA). Instead, it shows that human exposure is too low to have any measurable impact even for infants and children. As a result, regulatory measures to ban BPA could have unintended, adverse health and safety consequences.

Second, the consumer market is already adjusting to meet the demands of overly concerned Oregonians. Numerous manufacturers produce BPA-free beverage containers and major retailers are asking for alternatives to meet consumer demand. This should make one wonder why legislation is even needed to address BPA worries.

Cascade Policy Institute has put together this concise fact sheet to address the myths and misconceptions associated with BPA.

Click here to download the facts on BPA.

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Poison Pills vs. Gun Rights

Three common sense firearms bills passed the House of the Oregon Legislature and are now in the Senate Judiciary Committee. However, they are not only in jeopardy, but there is a possibility they will be amended with “poison pills.”

 

The three bills address very different, yet important, issues. The first makes Concealed Handgun Licenses (CHL) not subject to public records laws except under specific circumstances; the second allows reciprocity to out of state CHL holders; and the third provides a legal means to carry a firearm on a motorcycle, snowmobile or ATV.

 

During recent Senate hearings on these bills, the public was asked to testify on concepts that were not in writing, yet were under consideration as amendments to the bills. One concept was simply stated as “guns on public school grounds.” Another was “access to firearms for persons suffering from mental health issues.” The concepts were not defined or thought out. They are broad, sweeping issues that in no way pertained to the bills under consideration. Currently, these bills have bipartisan support and likely would pass the Senate in their current form. But if they are amended to include any of these concepts, the bills may suffer a quick death even though they address important issues that affect our 2nd Amendment rights.

 

The “poison pill” tactic isn’t new in politics, but it is cowardly. If anti-gun activists have issues they want addressed, they should introduce a bill and go through a legitimate public process, not hide behind political antics.

 

 

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Oregon’s Anti-BPA Packaging Legislation May Jeopardize Public Health

The Oregon Senate recently voted in favor of SB 695, which would ban BPA use for children’s food containers, baby bottles and sippy cups starting in January 2013. The Oregon House has yet to vote on the bill. While environmental activists were unable to get an all-out ban on BPA in other food packaging, they did get a provision that they will use to build momentum for such bans in the future: The bill creates a panel to “study” the potential for similar bans on other food packaging. However, BPA has already been studied extensively around the world. This new state-level panel is unlikely to discover any new information, but instead it simply will be used to push the activists’ agenda to ban more uses of BPA.

This anti-BPA legislation is based on environmental activists’ wrongheaded claims that BPA poses unreasonable risk to human health, specifically to children, although the overwhelming body of research suggests otherwise. Ironically, these policies threaten to undermine food safety because BPA is used to make resins that line metal cans and other packaging to prevent development of dangerous pathogens and other contamination. And there are few good alternatives should lawmakers eventually ban BPA. According to a World Health Organization report: “[A]t present, there appears to be no single replacement for BPA for all food contact applications. Furthermore, data on the safety of some of these replacement materials are limited or non-existent.” In other words, misguided bans of BPA in food packaging could have serious, adverse public health implications.

WHAT IS BPA? Bisphenol-A is a chemical intermediary used in the manufacturing of certain products, including polycarbonate plastics and epoxy resins. These plastics are used in a variety of products: baby bottles, five-gallon water jugs used in water coolers, medical equipment, sports safety equipment, cell phones and other consumer electronics, household appliances, and many other products. The resins are used for industrial flooring, adhesives, primers, coatings and computer components. Its applications for food packaging and containers, particularly uses for water cooler jugs, canned foods and baby bottles, have been the focus of much debate.

NEGLIBLE RISK. In wide use for over 50 years, BPA has been extensively studied. The best science tells us that consumer exposure to BPA is far below levels of concern. An analysis published in Medscape General Medicine reveals that consumers are most likely exposed to BPA at levels that are 100 to 1,000 times lower than EPA’s estimated safe exposure levels. It notes further that the research on BPA also shows that the exposure levels per body weight are similar for adults and children, which indicates that infant exposure is not significantly higher. Moreover, risks to humans are probably much lower than these estimates suggest because humans metabolize BPA faster and better than do the rodents used in BPA studies.

ENDOCRINE SCIENCE. Scientific research identifies BPA as “weakly estrogenic.” Humans are regularly exposed to such estrogen mimicking compounds. Most are produced by plants: so-called phytoestrogens. Phytoestrogens are found in all legumes, with particularly high levels found in soy. The impact of weakly estrogenic synthetic substances like BPA is insignificant compared to human exposures to naturally occurring phytoestrogens in the human diet. According to data from a 1999 National Academy of Sciences study, exposure to natural phytoestrogens is 100,000 to 1 million times higher than exposure to estrogen mimicking substances found in BPA. “Given the huge relative disparity between the exposure to phytoestrogens as compared to BPA concentrations, the risk of BPA in consumer products appears to be about the same as a tablespoon of soy milk,” notes researcher Jonathan Tolman.

COMPREHENSIVE STUDIES AND REVIEWS. Scientific panels around the world have reviewed, and continue to review, the complete body of evidence and none report serious concerns about BPA. These include:

U.S. Food and Drug Administration:

“An adequate margin of safety exists for BPA at current levels of exposure from food contact uses.”

The European Union Risk Assessment: The EU’s risk assessments in 2006 and reviews in 2008 and 2010 find no compelling evidence of BPA-related health effects at estimated human exposure levels.

National Institute of Advanced Industrial Science and Technology (Japan): This extensive study found that “the risks posed by BPA were below the levels of concern.”

U.S. National Toxicology Program (NTP): This review found no direct evidence of problems among humans. It expressed minimal to negligible concern for almost all factors. It called for more research in one area where it has only “some concern” because rodent studies showed some association of potential effects on behavior.

Health Canada: “Health Canada’s Food Directorate has concluded that the current dietary exposure to BPA through food packaging uses is not expected to pose a health risk to the general population, including newborns and young children.”

BPA bans will do little for public health, since they do not address significant risks. They are part of an ever-expanding arbitrary regulatory state that places many valuable products and freedoms at risk.

This Commentary is drawn from “Anti-BPA Packaging Laws Jeopardize Public Health,” by Angela Logomasini, Ph.D., published by the Competitive Enterprise Institute.

 


 
Angela Logomasini is Director of Risk and Environmental Policy at the Competitive Enterprise Institute. At CEI, Angela conducts research and analysis on environmental regulatory issues. She is co-editor of CEI’s book “The Environmental Source”, and her articles have been published in The Wall Street Journal, The New York Post, The Washington Times and other papers.

 

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HB 3510: The Affordable Health Care for All Oregon

Testimony on HB 3510
Before the House Committee on Healthcare
March 11, 2011

Co-Chair Greenlick, Co-Chair Thompson and members of the Committee, my name is Steve Buckstein. I’m Senior Policy Analyst and founder of Cascade Policy Institute, a non-partisan, non-profit public policy research organization based in Portland. Our mission is to promote policies that enhance individual liberty, personal responsibility and economic opportunity in Oregon.

I’m here today along with Dr. Eric Fruits and Arnie Poutala to share with you some of the reasons I believe this bill will not only fail to achieve its goals, but will actually make our health care system worse.
_____

First, let me share with you part of the introduction to the 2007 “Handbook on State Health Care Reform,”* published by the National Center for Policy Analysis. I’ve provided a link to the entire book online at the end of my written testimony.

There are three features of health policy everyone needs to understand:

Number one, health care is far and away the most complex social system there is. In fact, it may be even more complex than all other social systems combined.

Number two, health policy has been the object of more studies than any other market or area of human activity.

Number three, despite the huge volume of research, the large number of active researchers, and the best of all possible motivations, we have managed to produce hardly any truly workable solutions to the problems of cost, quality and access.

All too often, we seek solutions from the outside — usually in the form of government efforts to force the system to change.

To control costs, the conventional solution is to artificially push down provider incomes or restrict access to new technology.

To improve quality, the conventional solution is for government to dictate standards, in effect telling doctors how to practice medicine.

To improve access, the conventional solution is to expand government-funded health care to more and more groups and to make health care free at the point of delivery.

These conventional solutions have been tried in other developed countries and to a large extent they have been tried in the United States as well.

It is probably no exaggeration to say they have not worked very well.

In contrast to the conventional approach, we do not take the most important problems in health care as natural or inevitable. They are instead the artificial byproduct of the systematic suppression of normal market forces — which took place over the course of the 20th century.

Further, the solution to these problems does not lie in top-down, government-imposed remedies. It instead lies in bottom-up liberation. In particular, we need to free people from institutions that prevent them from solving problems on their own.

The most common source of problems in our health care system is the fact that people generally do not bear the full costs of their bad decisions or realize the full benefits of their good ones. On the buyer side, this means that patients who wastefully overuse health care resources usually pay only a small fraction of the cost of that waste. Conversely, patients who economize and avoid waste usually reap only a small fraction of the savings from their economizing.

 

On the provider side of the market, incentives are also distorted. In fact, health care providers rarely reap the benefits of being better at what they do.

 

Yet these problems are not unsolvable. One of the most amazing facts about our health care system is that for virtually every problem there are tangible, visible solutions — not hypotheticals, but real flesh and blood answers operating here and there, in diverse places.

 

For example, there are numerous examples of high-quality, low-cost health care in America — they are just not the norm. If we all got our health care at the Mayo Clinic, the nation’s health care bill could be reduced by one-fourth and the quality of care would be improved. If everyone went to Intermountain Healthcare in Utah, total spending would be reduced by one-third, again with higher quality.

Not only does health care not have to be expensive, there is no reason in principle why we should have to wait for it. In pharmacies, shopping malls and “big box” retailers around the country, people are getting high-quality primary care at walk-in clinics for half the normal cost and with very little waiting.

Nor does price and quality information have to be hidden. In the international marketplace hospitals routinely quote package prices for all manner of standard surgical procedures and publish quality data (including their mortality rates) as well. Furthermore, patients can get top-quality care at a fraction of what it would cost at most U.S. hospitals.

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Health Care Reform: Then and Now

Steve BucksteinQuickPoint!

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by Steve Buckstein

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In 1993, syndicated columnist Mike Royko had some choice words about Hillary Clinton’s national health care reform. Seventeen years later his words seem just as appropriate for Barack Obama’s plan. Here’s an extended quote:

“I listened to much of her testimony about how and why the health care program would be terrific for all of us. And I couldn’t figure out what the heck she was talking about. It was a deadly combination of bureaucratic jargon and legal jargon. And if any congressman claims to have understood it, he has been in Washington too long.

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The Oregon Health Plan: A Policy Placebo

Cascade Commentary

The Oregon Health Plan: A Policy Placebo
by Eric Fruits

The Oregon Health Plan has been called a “bold experiment” designed to expand health insurance to Oregon’s low-income residents. Its promoters promised the impossible: To expand health insurance coverage while simultaneously controlling costs and fostering provider participation. These promises would be met by the explicit rationing of care through a prioritized list of conditions and treatments. However, like the experimental drug that performs no better than a placebo, Oregon’s bold experiment has produced results that are not significantly different from the outcomes seen by the U.S. as a whole. In this way, the experiment has failed.

Expanding coverage. When John Kitzhaber first proposed the Oregon Health Plan in the late 1980s, he claimed that nearly 20 percent of Oregonians did not have health insurance, a claim that state agencies have echoed ever since. Unbeknownst to them, however, their data was incorrect. Revised estimates by the U.S. Census Bureau show that between 1987 and 1989, only 14.5 percent of Oregonians were uninsured, a percentage that was not much different from the U.S. as a whole. Indeed, census data show that the rate of uninsured during the life of the Oregon Health Plan has not been significantly different from the U.S. as a whole. In the end, one cannot confidently conclude that the Oregon Health Plan had any significant and sustained impact on reducing the number of uninsured as a share of Oregon’s population.

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The Oregon Health Plan: A Policy Placebo

Cascade Commentary

The Oregon Health Plan: A Policy Placebo
By Eric Fruits, Ph.D

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The Oregon Health Plan has been called a “bold experiment” designed to expand health insurance to Oregon’s low-income residents. Initially, the experiment had bipartisan support. The plan’s chief architect was John Kitzhaber, a Democratic state senator turned governor who is currently running for a third term as governor. The plan’s chief advocate in Washington, D.C. was Republican Senator Bob Packwood. Its promoters promised the impossible: To expand health insurance coverage while simultaneously controlling costs and fostering provider participation. These promises would be met by the explicit rationing of care through a prioritized list of conditions and treatments. The rationing plan generated international headlines, and the rollout of the plan prompted physicians and politicians from around the world to visit Oregon to see the bold experiment in action. However, like the experimental drug that performs no better than a placebo, Oregon’s bold experiment has produced results that are not significantly different from the outcomes seen by the U.S. as a whole. In this way, the experiment has failed.

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The Failure of the Oregon Health Plan

Steve Buckstein

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by Steve Buckstein

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A new report by Cascade Policy Institute looks at how well the Oregon Health Plan met its promised goals. Launched in 1994, the Oregon Health Plan sought to use a prioritized list of conditions and treatments to simultaneously expand coverage, control costs and foster provider participation in the state’s Medicaid system for low-income residents. By explicitly rationing care, the plan was called a “bold experiment” and was supported by political leaders of both major parties.

Now, sixteen years later, the report’s authors find that:
“[L]ike the experimental drug that performs no better than a placebo, the Oregon Health Plan has produced results that are not significantly different from the outcomes seen by the U.S. as a whole.”

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The Oregon Health Plan: A “Bold Experiment” That Failed

For immediate release

Contact Steve Buckstein
(503) 242-0900
steven@cascadepolicy.org

The Oregon Health Plan:  A “Bold Experiment” That Failed (download here)

Cascade Policy Institute has released a new report on how well the Oregon Health Plan met its promised goals.

Conceived in the late 1980s, the Oregon Health Plan has been called a “bold experiment” designed to expand health insurance to Oregon’s low-income residents. It relied on explicit rationing of care through a prioritized list of conditions and treatments.

Launched in 1994, the OHP sought simultaneously to expand coverage, control costs, and foster provider participation.

Sixteen years later, report author Dr. Eric Fruits concludes that:

“[L]ike the experimental drug that performs no better than a placebo, the Oregon Health Plan has produced results that are not significantly different from the outcomes seen by the U.S. as a whole.”

Dr. Fruits makes three major findings about the goals of the Oregon Health Plan:

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States Defend Citizen’s Right Not to Purchase Health Insurance (But Not Oregon)

Now that ObamaCare is the law of the land, it’s not surprising that attention is turning to the supreme law of the land, the U.S. Constitution, in an attempt to derail it in the courts. So far, it appears that seventeen states will join forces in a single suit against the federal government. Virginia is filing its own suit, based on the newly signed Virginia Health Care Freedom Act that protects its citizens from being forced to purchase health insurance or to participate in any health care system against their will.

The lawsuit’s main legal claim is that Congress does not have authority to require citizens to purchase a service they would not have purchased voluntarily, namely, health insurance.

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Founder’s Statement

Steve Buckstein
Founder’s Statement
by Steve Buckstein

The US Congress has now passed a sweeping health care “reform” bill that, even when “fixed” in the Senate, will represent much more a violation of individual liberty than an improvement in American health care.

When we founded Cascade Policy Institute in 1991 our mission was, and still is, to promote public policy alternatives that foster individual liberty, personal responsibility and economic opportunity. This bill threatens to set us back in all three areas:

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Health Care "Reform" a turning point

Steve Buckstein
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Health Care “Reform” a turning point
by Steve Buckstein

America’s founders had a clear vision of government’s role in the “land of the free.” Controlling large segments of the economy was not it. As the federal government moves to control virtually all health care in America, it’s up to freedom loving Americans to take a stand.

The resistance to this usurpation of power began last year with the emergence of the Tea Party movement. Millions of before now relatively uninvolved citizens got concerned about runaway government spending and deficits, and concerned about government taking over segments of our economy that it had no business doing.

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Government Health Care “Reform:” The Culmination of Incrementalism

Cascade Commentary

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The opening words of HR 3200, the initial solution to the health care “crisis” in the United States, read: “A Bill to provide affordable, quality health care for all Americans and reduce the growth in health care spending, and for other purposes.” I haven’t yet heard President Obama or Congressional leaders comment on those “other purposes.” However, let us be completely honest here. The only words in that opening statement that have real meaning are those last four words. (more…)

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Individual Accounts Can Save Medicare

Eric FruitsCascade Commentary

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Summary:Medicare is a “pay-as-you-go” system in which today’s workers are taxed to pay for today’s spending. Unfortunately, demographics and economic reality make this model unsustainable. A pay-your-own-way system of individual accounts will ensure that today’s workers receive high quality medical care when they become tomorrow’s retirees. (more…)

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Addressing some of the misinformationin the national health care debate

Dan Lucas
By Dan Lucas

SummaryDan Lucas is an IT worker for a nonprofit health insurer. Tired of hearing highly inaccurate and politicized information, he takes on four of the myths most often cited in the national health care reform debate:

“Insurance companies care more about profits than people.”
“The excessive salaries & bonuses that are paid to health insurance CEOs are a major factor in the cost of health insurance.”
“This is a health insurance crisis.”
“A public option is needed to keep health insurance companies honest and because the government is more efficient than private insurers at administering health care.”

Not true! Click here to read why….

View a PDF Chart of executive pay for health insurers here.

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