January 16, 2012 Republican Presidential Primary Debate (On Fox News Channel)

[twa]

The 500 B was a accounting trick used in justifying Obamacare costs

If you are gonna use it as savings you are going to get the blame for the cuts

[Tulane Skins Fan]

Put it back.

Accidentally put it up twice, and then removed both.

The president’s approval rating is lower than his disapproval rating. In mid-December, Gallup had him “underwater” by eight points: 42 percent approval and 50 percent disapproval.

His current Gallup approval rating is the lowest ever for any incumbent president at this point in his first term.

http://bangordailynews.com/2012/01/04/politics/gloomy-poll-numbers-for-obama/

Thought the debate was entertaining if nothing else.

That's actually changed a lot in the last month. He's running at about 48% approval now. Congress is still at its all time low though.

[jpyaks3]

I love Brian Schweitzer.

Not only would I vote for him, I'd actively campaign for him.

Alright I am intrigued by this, why do you love Brian Schweitzer?

[NoVaO]

I love Brian Schweitzer.

Not only would I vote for him, I'd actively campaign for him.

Interesting...he's kind of a populist and should he run, I suspect he'll draw upon his populism in the primary to try to get votes. You'd be OK with that? Also, what draws you to him in the first place?

---------- Post added January-17th-2012 at 11:33 AM ----------

The $500 billion came out of Medicare Advantage, not actual Medicare. This was not an accounting trick. And Medicare Advantage was an inefficient system. Ezra Klein explains:

Congress allowed private HMOs to compete for Medicare patients under the rationale that they could offer better service at lower cost than the government. They couldn't. So Republicans in Congress began boosting their payments, to the point that Medicare Advantage gets paid 114 percent what Medicare gets paid to care for a patient. That leads to some fun perks, like free gym memberships and complimentary aspirin and band-aids, which in turn leads seniors to defend the program because they like their perks. But it also means a lot of unnecessary expense for taxpayers.

And it's important to remember that those free perks do not account for the whole of Medicare Advantage's overpayments. Rather, economists have estimated that for every extra dollar we pay the program, 14 percent is passed on to seniors and 86 percent goes to profits or other costs. In other words, we're getting only 14 cents of obvious value for every dollar of overpayment.

In addition, the Ryan Plan actually kept that $500 billion cut in his plan, and I suspect Romney does in his plan as well.

[Wrong Direction]

The $500 billion came out of Medicare Advantage, not actual Medicare.

Actually, it came from many areas, but two primary funding streams. 1) Medicare Advantage and 2) Hospital reimbursements. In each case, the "cuts" could have an effect on the offerings and/or services provided to Medicare beneficiaries.

[NoVaO]

Actually, it came from many areas, but two primary funding streams. 1) Medicare Advantage and 2) Hospital reimbursements. In each case, the "cuts" could have an effect on the offerings and/or services provided to Medicare beneficiaries.

You're right. Fair enough.

[Tulane Skins Fan]

Actually, it came from many areas, but two primary funding streams. 1) Medicare Advantage and 2) Hospital reimbursements. In each case, the "cuts" could have an effect on the offerings and/or services provided to Medicare beneficiaries.

How so?

Without playing games, are you saying that if a hospital gets paid less they will not offer as good of care to a patient?

Again, what I don't understand is that this is the exact program that republicans say needs to be reduced. Why is this a bad thing from a GOP's philosophical perspective?

[Wrong Direction]

1) The GOP's proposed reforms aren't reforms. They're destruction.

That's a blanket statement without context.

If your goal is get higher rates of return on your retirement investment, Republican reformers can claim the upper hand.

If your goal is to retire on your own terms, rather than wait until the government can afford to pay you, Republican reformers are on your side.

The current Social Security system disincents personal savings. It refuses to pay out until you're 65, and people from both parties are gradually coming to an agreement to raise that age. Newt's plan, in particular, would destroy the negatives while actually promoting a higher standard of living for retirees. If that's destruction, sign me up.

Please, tell me about the Roth where you can pay $20K into it, and collect $5,000/year for life.

I guarantee you any plan would have a benefit for impoverished seniors. This is not an issue that either party disputes.

---------- Post added January-17th-2012 at 12:14 PM ----------

How so?

Without playing games, are you saying that if a hospital gets paid less they will not offer as good of care to a patient?

Again, what I don't understand is that this is the exact program that republicans say needs to be reduced. Why is this a bad thing from a GOP's philosophical perspective?

Two questions here:

1. Will cuts to reimbursement affect care?

Yes, in some cases. Hospitals are private, mostly for-profit companies. They are very driven by their bottom line. If their profits were X before the ACA, now their X - Y%, excluding all non-related factors. So, the CEOs of these hospitals are seeing profits go down on their watch. This puts pressure on everything from staffing levels, to new imaging equipment purchases, to level of services offerred to the uninsured. There is always pressure on private businesses to turn a profit. In this case, cuts to reimbursement simply adds to that pressure.

2. Are Republicans against these cuts?

There's no simple answer to this. In last night's debate, Rick Santorum and Mitt Romney said they disagreed with Newt's SS reform plan because it immediately spent the money that he was saving through other cuts. So, from a debt perspective, R's would probably accept/expand upon the cuts if it went to lower spending. Instead, they're being immediately spent through a new entitlement program.

Philosophically, R's would say that the government is completely incapable of setting reimbursement rates. When cuts are made, every lobby in town will be knocking on the doors of every senator, representative and administration official. They'll all claim that more spending will save Medicare money in prevention (a pipe dream, at least today) and it'll keep grandmom out of a nursing home, or a gutter, or a casket. This is our Medicare system of the last 40 years, and it's why R's support a system of premium support.

[Larry]

That's a blanket statement without context.

If your goal is get higher rates of return on your retirement investment, Republican reformers can claim the upper hand.

Of course.

But that's because you're comparing a "paid in advance" funding system, with a "pay for it when you spend it" system.

You're comparing a system where the investor gets a percentage of return on money he's invested, against a system where 98% of the money he pays in, goes out the door to somebody else, immediately.

In short, you're not talking about the difference between government and provate. You're talking about the difference between investing and spending.

Now, you want to convert SS to a system where it's paid for in advance? I'm all for it.

Here's what you do.

1. Effective immediately, all SS spending comes out of general revenue, instead of coming from SS.
   
2. All SS taxes go into the SS trust fund, and stay there.
   
3. When current workers retire, then part of their SS checks come from general revenues, and part from the trust fund, proportional to how much of their taxes went into the old system vs the new system. For example, people who retire next year will have paid 44 years into the old system, and one year into the "paid in advance" system. Therefore, 1/45 of their SS benefits will come out of the trust find, and the other 44/45 will come from general revenue. (But that's for new retirees. People who retired last year will continue to be funded 100% from general revenue, till they die.)
   
4. 45 years from now, everybody will have been paying into the "paid in advance" system, and new retirees won't be taking money out of general revenue any more. (And, by then, previous retirees will only be getting part of their money from general revenue. The folks who were getting 100% from GR will have died off.)

Now, under a system like that, if you want to argue that well, you think that investing the SS trust fund in t-bills is an undesirable investment, because it doesn't pay enough return, and you'd rather see the trustees invest it someplace with a better return, then I could certainly understand the argument.

Congratulations! You've now converted SS into a retirement plan that's funded in advance, by worker's investments. And you didn't have to get rid of it, to do it.

Me, I'm certainly not qualified to crunch the numbers, but my gut says that if SS were paid for up front, that you'd generate such an incredible amount of money from the investments that you could probably pay for SS and Medicare out of the profits.

----------

Now, there is that pesky detail, that step 1 of this plan, above, adds $700 Billion to the federal deficit, this year, and another $700 Billion next year, and the amount goes up in future years (before gradually going down, decades from now).

But, that's true of any plan that attempts to convert SS into a system that's paid in advance. Divert the current revenues from "paying for people who are already retired" to "going into an account, somewhere, to pay for people who are still working", and you have to come up with some other way of paying for the people currently retired.

[Tulane Skins Fan]

That's a blanket statement without context.

If your goal is get higher rates of return on your retirement investment, Republican reformers can claim the upper hand.

If your goal is to retire on your own terms, rather than wait until the government can afford to pay you, Republican reformers are on your side.

The current Social Security system disincents personal savings. It refuses to pay out until you're 65, and people from both parties are gradually coming to an agreement to raise that age. Newt's plan, in particular, would destroy the negatives while actually promoting a higher standard of living for retirees. If that's destruction, sign me up.

I guarantee you any plan would have a benefit for impoverished seniors. This is not an issue that either party disputes.

---------- Post added January-17th-2012 at 12:14 PM ----------

Two questions here:

1. Will cuts to reimbursement affect care?

Yes, in some cases. Hospitals are private, mostly for-profit companies. They are very driven by their bottom line. If their profits were X before the ACA, now their X - Y%, excluding all non-related factors. So, the CEOs of these hospitals are seeing profits go down on their watch. This puts pressure on everything from staffing levels, to new imaging equipment purchases, to level of services offerred to the uninsured. There is always pressure on private businesses to turn a profit. In this case, cuts to reimbursement simply adds to that pressure.

2. Are Republicans against these cuts?

There's no simple answer to this. In last night's debate, Rick Santorum and Mitt Romney said they disagreed with Newt's SS reform plan because it immediately spent the money that he was saving through other cuts. So, from a debt perspective, R's would probably accept/expand upon the cuts if it went to lower spending. Instead, they're being immediately spent through a new entitlement program.

Philosophically, R's would say that the government is completely incapable of setting reimbursement rates. When cuts are made, every lobby in town will be knocking on the doors of every senator, representative and administration official. They'll all claim that more spending will save Medicare money in prevention (a pipe dream, at least today) and it'll keep grandmom out of a nursing home, or a gutter, or a casket. This is our Medicare system of the last 40 years, and it's why R's support a system of premium support.

Honestly, I don't think a typical illness gets treated differently based upon how much a doctor or hospital is being paid. They still have ethical obligations. I guess I don't really think every market can be explained that way.

Let me ask you this: do you think that a life-saving procedure can really be paid for in its actual value? Isn't such a procedure priceless? Wouldn't you spend any amount of money you have to keep your children/wife/parents/close ones alive?

I don't think this industry can really be explained in the same way other markets can because of the uniqueness of its value to "consumers."

[Wrong Direction]

Larry,

I actually agree with a lot of your post. We should absolutely prioritize a transition away from pay as you go. The details of that are quite fungible, so I'm guessing reasonable people (e.g., not politicians) could agree on how to pace/fund that transition.

All I'd quibble with is your assertion that we should give the money to central government trustees rather than market based funds, with certain protections, and when to do that, which is unclear from your post I think. I'd argue that individuals maintaining their own investments would have direct and indirect benefits, and I think it would hasten the transition away from a pay-go system.

The only thing I'd add, since this is always the response I hear on this topic is no, I wouldn't just tell people they have a retirement savings to invest however they want. I don't want to create a nation of day-traders who can lose everything in a minute. There has to be a reasonable alternative. Plans like Thrift, IRAs..., whatever.

---------- Post added January-17th-2012 at 12:59 PM ----------

Honestly, I don't think a typical illness gets treated differently based upon how much a doctor or hospital is being paid. They still have ethical obligations. I guess I don't really think every market can be explained that way.

How do they treat a patient if they have less residents and nurses on the floor? How about if they have old imaging equipment, or only one MRI machine? What will those shortages do to the decision making of those on the floor? It's all related. If cutting was as simple as removing extra coin from very rich people's pockets, who wouldn't support that?

Note, I'm actually generally arguing a Democrat position against cuts here. It's just that, in this case, it was the Dem that did the cutting.

Let me ask you this: do you think that a life-saving procedure can really be paid for in its actual value? Isn't such a procedure priceless? Wouldn't you spend any amount of money you have to keep your children/wife/parents/close ones alive?

Markets don't just take into account a person's willingness to pay. If they did, prices would be far beyond what they are today. Markets have to take into account a population's ability to pay and the supply of providers willing to provide that service.

In healthcare, we don't have nearly enough docs, nurses or pharmacists. This is a systemic problem that isn't addressed at it's core in the ACA. Obama did add some funding, but his plan is very insufficient because it doesn't break the AMA's hold on the number of people accepted to med school.

As far as payment goes, this is why a premium support model makes better sense. It takes the individual's life-saving decision out of the equation. Instead, it puts all individuals into a pool and it helps them afford their way into that pool. It works as follows:

1. Docs contract with insurance plans to provide all services (rates vary by service, of course).

2. Insurance plans consider all coverage mandates, level of community services and profit motives to offer a coverage benefit to beneficiaries.

3. Beneficiaries, with premium support from the government, purchase a coverage package from insurance companies who are competing with each other on profits.

At no point does the government need to get involved in pricing in order to guarantee someone coverage for life saving treatments. The political arguments, then, come down to coverage mandates, but not pricing.

[Tulane Skins Fan]

How do they treat a patient if they have less residents and nurses on the floor? How about if they have old imaging equipment, or only one MRI machine? What will those shortages do to the decision making of those on the floor? It's all related. If cutting was as simple as removing extra coin from very rich people's pockets, who wouldn't support that?

Note, I'm actually generally arguing a Democrat position against cuts here. It's just that, in this case, it was the Dem that did the cutting.

Markets don't just take into account a person's willingness to pay. If they did, prices would be far beyond what they are today. Markets have to take into account a population's ability to pay and the supply of providers willing to provide that service.

In healthcare, we don't have nearly enough docs, nurses or pharmacists. This is a systemic problem that isn't addressed at it's core in the ACA. Obama did add some funding, but his plan is very insufficient because it doesn't break the AMA's hold on the number of people accepted to med school.

As far as payment goes, this is why a premium support model makes better sense. It takes the individual's life-saving decision out of the equation. Instead, it puts all individuals into a pool and it helps them afford their way into that pool. It works as follows:

1. Docs contract with insurance plans to provide all services (rates vary by service, of course).

2. Insurance plans consider all coverage mandates, level of community services and profit motives to offer a coverage benefit to beneficiaries.

3. Beneficiaries, with premium support from the government, purchase a coverage package from insurance companies who are competing with each other on profits.

At no point does the government need to get involved in pricing in order to guarantee someone coverage for life saving treatments. The political arguments, then, come down to coverage mandates, but not pricing.

You make some interesting points, but a lot of that is not really how healthcare works already. Not every hospital has state of the art equipment. There are many levels of hospitals that identify what type of patients they can treat, etc. You may be able to come up with some anecdotal evidence to support the idea that lowering payments makes MRI's, for example, less available, but the truth is that that is also a market. And those companies that make MRI's have to sell them to someone.

As far as the second point, I still think there's a fundamental difference between the healthcare market and any other market. I won't pay whatever I have for the Chipotle I just bought. I will pay whatever I have for my wife's life. Its the only market where you really say "price is not a deterrent."

I'd have to think about your latest model too; its interesting. I don't see a significant difference from what we have though. And just noticing, insurance companies don't really compete in a free market now. There's a very good reason for this: we don't want insurance companies to go out of business. The whole idea of insurance is to spread risk around a larger pool of individuals, and if you let some companies lose, i.e. fail, then you hurt the value of the insurance itself.

[Wrong Direction]

I'd have to think about your latest model too; its interesting. I don't see a significant difference from what we have though. And just noticing, insurance companies don't really compete in a free market now.

The difference from that and Medicare Fee for Service (traditional Medicare) is night and day. In traditional Medicare, politicians are the biggest target for lobbyists you can imagine because they set payment rates. It's never ending. Heck, I'm looking at a paper from a consultant right now.

Oh, and insurance companies would have a much more free market without federal obstruction to inter-state commerce.

[Larry]

Oh, and insurance companies would have a much more free market without federal obstruction to inter-state commerce.

Translation: "without federal obstruction to inter-state commerce" actually means "if the federal government would just pass a law mandating that all state insurance regulations are completely void, except for whichever state the insurance companies decide is the state that is most friendly towards them".

Just for the folks who haven't been seeing this "logic" for the last few years.

[Tulane Skins Fan]

The difference from that and Medicare Fee for Service (traditional Medicare) is night and day. In traditional Medicare, politicians are the biggest target for lobbyists you can imagine because they set payment rates. It's never ending. Heck, I'm looking at a paper from a consultant right now.

Oh, and insurance companies would have a much more free market without federal obstruction to inter-state commerce.

As far as the last point, there actually isnt much federal regulation of insurance industries. Most of it is state regulations. There is a federal antitrust exemption, i.e. less federal government oversight, but not much federal regulation. So the fact is that they DO NOT compete in a free market. They compete in a highly state-regulated market.

A bigger point on that though is that I'm saying that there are good reasons not to have insurance markets compete on a free market. We don't want insurance companies failing, for policy reasons. We do want people to be able to spread risk, and then not worry that their company will go under.

[Kilmer17]

I think allowing the possibility of an Ins Co failing is a good thing. It will make them more likely to make decisions necessary to remain viable. If they arent allowed to fail, then they dont need to worry about basic business practices. Which CAN (not always) lead to an even worse situation.

Fear of failure is a powerful motivating tool for businesses.

[Tulane Skins Fan]

I think allowing the possibility of an Ins Co failing is a good thing. It will make them more likely to make decisions necessary to remain viable. If they arent allowed to fail, then they dont need to worry about basic business practices. Which CAN (not always) lead to an even worse situation.

Fear of failure is a powerful motivating tool for businesses.

It is, but it is a long standing policy that we don't want the insurance consumers to be left out to dry because they picked a company that somehow went under. We want CONSUMERS, i.e. individuals, to be able to buy insurance, pool their risk, and have peace of mind that they have some stability for whatever they purchased insurance.

[Kilmer17]

It is, but it is a long standing policy that we don't want the insurance consumers to be left out to dry because they picked a company that somehow went under. We want CONSUMERS, i.e. individuals, to be able to buy insurance, pool their risk, and have peace of mind that they have some stability for whatever they purchased insurance.

Then the solution is to find ways to ensure that outcome without creating a "too important to let fail" system.

Using the P&C side as a guide. A system can be set up where the company goes into receivership until it is bought (in whole or parcelled) to other companies.

[Tulane Skins Fan]

Then the solution is to find ways to ensure that outcome without creating a "too important to let fail" system.

Using the P&C side as a guide. A system can be set up where the company goes into receivership until it is bought (in whole or parcelled) to other companies.

I'm all ears.

[Larry]

deleted post.

Folks, we're way far away from discussing the debate.

Also, should "Rick Perry's Turkey" be merged in here, or into the Rick Perry thread?

[Kilmer17]

We already have that.

The states create regulations that require businesses to maintain adequate reserves.

Just like we used to do for banks and financial institutions.

Right. But it still doesnt prevent companies from failing from time to time. When that happens in the P&C business, the policy holders maintain their current policies, but the state JUA (joint underwriting association) or sometimes the actual Dept of Financial Services directly will become the temporary backer of the policies. The policies are then sold to other companies as a whole, or more often sold in parts depending on the risks.

[Tulane Skins Fan]

Right. But it still doesnt prevent companies from failing from time to time. When that happens in the P&C business, the policy holders maintain their current policies, but the state JUA (joint underwriting association) or sometimes the actual Dept of Financial Services directly will become the temporary backer of the policies. The policies are then sold to other companies as a whole, or more often sold in parts depending on the risks.

I don't think you could sell that in many states these days. That's so easy to attack politically as a government takeover/bailout of your insurance company.

[Kilmer17]

I don't think you could sell that in many states these days. That's so easy to attack politically as a government takeover/bailout of your insurance company.

I think it sells if it's offered as the alternative to Govt guarentee of all existing companies. Plus it probably already exists in most if not all states for other lines of Insurance.

[Wrong Direction]

Translation: "without federal obstruction to inter-state commerce" actually means "if the federal government would just pass a law mandating that all state insurance regulations are completely void, except for whichever state the insurance companies decide is the state that is most friendly towards them".

Just for the folks who haven't been seeing this "logic" for the last few years.

Hold on. Why can't insurance be sold across state lines? I'm under the distinct impression that states do not have this legal option today. I could be wrong, but I don't think it's as simple as having a governor open up his/her own borders to more competition. If it was, more R states would be doing that.

[Note: I know how ACA handles this. I'm asking about the status quo though.]

[LadySkinsFan]

What having insurance open across state lines means that insurance companies will all write policies in the state(s) that give them the most profit while providing the least amount of benefits. And it would mean that all Americans covered under a for profit insurance company will have a jack **** policy that they pay and pay for and never get any benefit from and there would be no competition to keep the price of insurance low.