Punishing the Guilty- Unless We Don’t

The Heritage Foundation nailed it in their Morning Bell yesterday:

The TARP program has so far distributed $247 billion to more than 700 banks. Of that, $162 billion in principal and $11 billion in interest and dividends have already been repaid. Except for AIG, almost all banks that received taxpayer money are expected to pay back the American taxpayers in full. As The New York Times reports: “The losses from the bailout fund are expected from money paid to rescue Chrysler and General Motors and the insurance giant American International Group, and from a program to help homeowners avert foreclosures.”

So the real deadbeats that are not giving us “our money back” are not the banks, but the union-backed car companies and failed government mortgage modification programs. But guess what? The White House has chosen not to include the car companies among the institutions that will pay this so called “Financial Crisis Responsibility Fee.” Also exempted are Fannie Mae and Freddie Mac, the government-sponsored entities that helped create the crisis.

It’s time we told our elected officials to stop picking winners and losers, and voted in people who are in favor of term limits and in favor of a separation of business from government. Beyond liberal or conservative, these are the issues that are so important to America. After all, when Howard Dean, Markos Moulitas and Arianna Huffington agree with The Heritage Foundation…perhaps it’s time for- and I dislike using this word- change to how our system works. Of course, it’s up to us, the voters and citizens of America, to make said change.

Stimulus Fail, Part 2 (Part 3? 4?)

The Washington Examiner’s Mark Hemingway takes it away with this one:

“A new analysis of the $157 billion distributed by the American Reinvestment and Recovery act, popularly known as the stimulus bill, shows that the funds were distributed without regard for what states were most in need of jobs.”

Later: “The Mercatus Center analysis also found that Democratic congressional districts received on average almost double the funding of Republican congressional districts. Republican congressional districts received on average $232 million in stimulus funds while Democratic districts received $439 million on average.”

Lastly: “Finally, the Mercatus analysis shows that a majority of the funds allocated went to public rather than private entities — nearly $88 billion to $69 billion.”

What a surprise- you mean to tell me the stimulus is failing again? I’m shocked. Really. (Okay, not really.)

This is really bad, for four reasons: first, since a majority of public employees are members of unions, the money is going to sources of voting power for Democrats as opposed to helping all Americans (assuming, of course, it did help, which is doubtful). Secondly, the money was not distributed for efficienty of employment- even though that was its selling point. Thirdly, the money was spread by two departments not Congress, which means either those departments are biased (unlikely) or they are following a formula, as the study Hemingway quotes concludes, and that means the formula is skewed. Fourth, this is almost exactly 20% of the $770 billion approved by Congress, and it’s been ten months or so since it was approved.

George Will called it- “Which suggests that Stimulus II is…primarily designed to save a few dozen jobs — those of Democratic members of the House and Senate.”

An Actual Solution To Health Care Reform

As a third year medical student keeping a close eye on the progress of the health care reform proposals moving through the Democrat-controlled Congress,? thoughtful analysis leads to one conclusion ? a government takeover of the health care system is not the solution to the catastrophic problems we face.

I am concerned by the justification given by Democrat leaders and liberal newspaper editorial boards for supporting the ?public option.?? The Miami Herald recently opined ?private insurers don’t make a profit by insuring people likely to need coverage? ? which could be distilled to ?sick people cost more.?? The significance here is that insurance companies then charge them more making coverage increasingly unaffordable.? To complete the argument, the ?public option? would solve this problem.? The CBO says otherwise.? The non-partisan referee of this domestic policy heavyweight bout says the public plan would be more costly than the average private plan because it would ?engage in less management of utilization by its enrollees and attract a less healthy pool of enrollees?. In other words, sick people are more expensive independent of who is paying the bill.

To some, the answer to this problem is ?guaranteed issue? ? colloquially known as making it illegal to discriminate against those with pre-existing conditions.? This is known to drive up insurance premiums, in one study by 227%, making coverage for the young and healthy cost-prohibitive.? These are the coveted participants referred to obliquely above that allow the spread of social risk.? In the House bill, the penalty associated with foregoing insurance is 2.5% of adjusted gross income.? For a young person making $40,000, this amounts to $1000 ? small fare if purchasing insurance will cost between $6000 and $8000 ? especially if you don?t think you are going to get sick.? What to do now? As is the case with many government interventions into the private sector, we quickly become mired in how to fix the fixes.

The solution is much less complicated.? What Speaker Pelosi failed to do Friday in 1,990 pages of definitions, distinctions, and dictums, I will do in 418 words.

First, go after Medicare and Medicaid fraud.? A CBS 60 minutes investigation estimated the cost of that enterprise to the taxpayers at $60 billion a year.? A GAO study showed that in 2007, $32.7 billion of Medicaid payments were improper – this cost the state of NY alone over $5 billion. How can we justify expanding the role of government in health care before fixing the current iteration?

Second, sever the union of employers and insurance by taxing employer health plans as income and returning it to employees in the form of a tax credit to purchase insurance.? This would empower patients to choose plans that meet their needs while simultaneously making their plan of choice completely portable.

Third, allow the purchase of insurance across state lines to create a robust market of choices with coverage mandates to be decided by a panel of physicians ? not bureaucrats.? This will facilitate creation of plans for the young and healthy based mostly on routine checkups and catastrophic protection alongside ones for the chronically ill centered on meeting evidence-based guidelines to monitor their conditions.? This prescription gives insurance companies something they want in exchange for something we need.

Fourth, institute meaningful tort reform.? The Pacific Research Institute estimates we spend $200 billion annually on defensive medicine.? Compensating those who are truly harmed and punishing the neglectful does not require trial lawyers.? Physicians traditionally spend 4 years in undergraduate school, 4 years in medical school, and between 3-7 years in residency with a fellowship to follow should they decide to further specialize.? Loss of a license equals loss of a career and loss of 10+ years of one?s life spent intensely training.?? In this medical student?s opinion, there exists no harsher punishment.

Finally, reform the Medicare physician payment formula.? The SGR is an archaic method to determine reimbursement that underpays doctors and forces them to take on less Medicare patients and more of the privately insured in order to cover costs.? The current legislation under consideration in both houses of Congress imposes a 25% across-the-board pay cut to Medicare?s physicians ? Svengali accounting at best and because it will never happen, also blatantly dishonest.? 13 Democrats joined all 40 Republicans voting down the ?doctor fix? bill in the Senate two weeks ago largely because it was seen an attempt to hide the true cost of health care reform.? The adjustment will cost $250 billion over a decade but is a necessary addition to comprehensive legislation to ensure that our senior citizens continue receiving high-quality care.

This five-point plan at Ms. Pelosi?s price of $2.2 million per word only costs only $1 billion.? Please make the check payable to Nicholas Rohrhoff.

From hearing the gentleman repairing my family’s refrigerator the summer before medical school mention how many more he has to repair in order to afford his coronary bypass surgery to sitting in a classroom of 150 extraordinary colleagues called to serve their fellow citizens in the noblest of professions;? From seeing my father?s corporate job disappear in the financial meltdown along with my family?s insurance policy to having a colleague at the University of Florida ask me if we, as future physicians, are going to need second careers in order to secure our financial futures ? I?ve drawn an undeniable conclusion: people are policy.

Health care reform is the domestic issue that will define my generation.? How we decide to take care of each other will be our legacy. ?Unleashing the remarkable ability of the American patient as consumer to bring down costs and increase quality (with appropriate consumer protections and subsidies for those in need) and incentivizing physicians to provide high-quality care and push the envelope of medical innovation is the answer.? As Candidate Obama said, ?We are the ones we?ve been waiting for.?? We are the real public option.

-nicholas rohrhoff is a third year medical student at the University of Miami?s Miller School of Medicine