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29 June 2012

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MRW

Chief Justice Roberts called the mandate a tax so that the language on page 151 Section 1502 of the Patient Protection and Affordable Care Act would kick in. The language is specific. It says that no one can be penalized for not paying the 'tax" and specifically orders the Secretary of the Treasury that no one can be penalized. Full text of Act at healthcare.gov/law/full. This text is on page 170 of the actual PDF, even though it says p.151.

Here it is for the time constrained. Naturally, no one in the media, except Lawrence O'Donnell, or in the congressional offices bothered to read this. Or they are just playing with us with faux anger and smoke and mirrors, and more political theatre.

"(g) ADMINISTRATION AND PROCEDURE.—
(1) IN GENERAL.—The penalty provided by this section
shall be paid upon notice and demand by the Secretary, and
except as provided in paragraph (2), shall be assessed and collected
in the same manner as an assessable penalty under subchapter
B of chapter 68.
(2) SPECIAL RULES.—Notwithstanding any other provision
of law—
(A) WAIVER OF CRIMINAL PENALTIES.—In the case of
any failure by a taxpayer to timely pay any penalty imposed
by this section, such taxpayer shall not be subject to
any criminal prosecution or penalty with respect to such
failure.
(B) LIMITATIONS ON LIENS AND LEVIES.—The Secretary
shall not—
(i) file notice of lien with respect to any property
of a taxpayer by reason of any failure to pay the penalty
imposed by this section, or
(ii) levy on any such property with respect to
such failure."

Watch O'Donnell take it apart two years ago. The language of the law part started at 2:25 minutes but the lead up is interesting.
http://www.youtube.com/watch?v=MHiz4hazV94

MRW

Another thing: the Supreme Court cannot rule on the applicability of the 'tax', any tax, until someone has paid it. That can't happen until after December 31, 2013.

toto

The Middle Class not surprisingly sees this as a law that essentially transfers wealth from them to recipients of the coming subsidies to poor people for health car insurance.

Actually that's a bit of a question mark - to me at least.

1- I was under the impression that most of the extra money will actually come from pretty well-off people (e.g. the high-end health plans that will support a 40% tax).

2- While some of the money will undoubtedly come from the middle class, the middle class will also save some amount of money through cheaper insurance (more people insured = lower premiums). There is also hope that putting the poorer people back under medical coverage would lead to better prevention and fewer emergency procedures, that are more costly to the taxpayer.


I suppose smarter people have already evaluated these effects, but it's been difficult to separate the signal from the noise in the shouting match.

(Disclaimer: I'm a Frenchman, living in Massachusetts. I don't think this thing will affect me much either way)

Will Reks

When you say the poor are not doing enough for health care you mean that they don't make enough money at their jobs to be able to afford health insurance or that their employers do not offer health insurance to them. The poorest, of course, qualify for medicare. It's not quite free-loaders versus the hard-working masses.

The second thing is that healthcare coverage for the middle class masses is mostly from employers. These employers would like nothing better than to rid themselves of the cost of insuring their employees. So we'll see how that goes in the next decade. Obamacare will make it easier for them to justify ending healthcare as a benefit. Remember, there is no employer mandate for healthcare, a provision even Nixon championed back in the day.

SK

I read your blog often enough to know that you are a thoughtful person, but the parentheses line below isn't helping make your case and, well...
"This law will fund medical care for the poor, (mostly people of color)."

Do we really need to drag race into this? It is transparently a class issue. We don't help ourselves by twisting a "rich vs. poor" question into "virtuous white people vs lazy people of color" question.

On to the substance. The law ALSO fund care for the working poor (waitresses, store clerks, who don't get health insurance at work). Through the "no pre-existing conditions" policy it will also ENABLE care for the self employed (I am working through the nightmare of buying individual insurance now - it isn't a question of money but access). It will also ENABLE "gap" care for the no-fault-of-their-own unemployed who have run past their COBRA limits. It will also ENABLE care for hit-by-a-bus-can't work-life-is-drastically-changed people.

We could all become one of the above - especially the hit-by-a-bus scenario.

The reason to include the poor is NOT (necessarily) as a giveaway to BHO's minority supporters. It is to broaden the insurance pool AND create a more rational mechanism for delivering care than the emergency room. Because POOR PEOPLE STILL GET SICK AND WE DON'T TURN THEM AWAY WHEN THEY SHOW UP IN THE SYSTEM AND SO WE STILL PAY FOR THEM.

The alternative to the mandate is simple. If you don't have health insurance you don't get medical care. We just set up a big tent next to emergency room (maybe with free morphine) and the uninsured get triaged there to bleed out when they/you get hit by that bus. Sort've like improving auto-safety by mounting a 4 inch spike on the steering wheel instead of an airbag (people would drive VERY carefully with that nice sharp point staring them in the face...)

If we as a society arent willing to cast the uninsured aside, then we need to face up to it and pay for that care as efficiently as possible. And that means making EVERYONE pays in advance rather than after they get hit by the bus. And if they can't pay, we carry them along via some rational system vs pretending they don't exist.

Personally, I would be OK with the "let them bleed out" approach if it was combined with a guaranteed right to buy care (I can affor insurance, if someone will sell it to me). What we have now is a quasi-socialist hybrid where way too much money goes to playing hot-potato with where the cost of the care lands and too little goes to actually delivering care (why US cost/care/outcomes stats stack up so poorly vs other developed countries). The health care act is at least a first step toward confronting that reality. The people objecting to it are really just objecting to having their illusions punctured by the reality in front of them.

Anyway - rant off.

r whitman

There will be a number of middle class and upper middle class beneficiaries of this law once the local health insurance exchanges are set up:

1. Upper middle class people in their 50's and early 60's who are still working and have enough assets to retire but are too young for Medicare will be able to get reasonably priced, non cancellable heath insurance even with prior medical problems.

2. Middle class people with assets who are unemployed either voluntary or involuntary. As an unintended consequence, if health insurance is readily available independent of the workplace, more people may go into business for themselves, leading to an increase in new business formation.

3. Small business owners who want to offer their employees health insurance benefits with the job (and incidentally cover themselves and their family) but are tired of the annual struggle with and the screwing they get from their health insurance provider as well as the usual employee complaints. I can see these people saying to their employees--Go over to the health insurance exchange, sign up for Plan A and we will reimburse you 75% or something on that order.

Perhaps other contributors here can think of some more.

JohnH

"The probable recipients of the subsidies mostly do not presently pay any federal income tax"...but most have withholding taken, which will not be returned if they haven't bought health insurance. That plus the broader, mandated pool of healthier, younger people is what will pay for much of the health insurance.

Granted, many conservatives think that the disadvantaged in our society are freeloaders (sometimes correctly). Those on the other side think that the 0.1% of the true freeloaders due to monopolistic price gouging parasitic over-priced contracts with government. As for banksters, they get to tank the economy then borrow at 0% then lend to students at 6.8-10%.

IMHO predatory freeloading by powerful crony capitalists far exceeds that of the proletariat.

Funny how conservatives only notice predatory or parasitic behavior when the lower classes do it...

turcopolier

SK

IMO if you think that race is not a factor in this matter, then you are not observing this process closely enough.

Like R. Whitman I thnik this law is beneficial to society in th elong run. what I am describing in this post is the attitude on the [art of a lot of middle class white people that results in such a high rate of disapproval for the law.

Personally, I would be willing to pay higher taxes for the purpose of providing health care for the poor of any color. Many are not.

pl

Fred

There is also a view expressed by some that the Roberts court has created an opion that once states accept certain programs (Medicare,etc) the Federal Government can not threaten complete cancellation of funding if additional 'constraints' are added. Doesn't that effectively mean a State entitlement to cash flow from the Federal Government for these programs - regardless of Federal taxation levels or sources?

http://delong.typepad.com/sdj/2012/06/jonathan-adler-on-the-medicaid-provisions-of-robertss-switch-in-time.html

Bill H

Cheaper insurance is by no means assured. More people will be paying in, to be sure, but payouts increase a lot as well; no lifetime cap, no preexisting exclusion,, no ability to drop...

Bill H

I am also, but I would prefer not to contribute to corporate profits in the process, at least no more than is avoidable. Insurance profits are avoidable.

Jonathan

For what it is worth, here is link to information on Medicaid recipients. Below I have excerpted the percent of Medicaid recipients who are White for several states. The link provided allows getting the information for every state. For the US as a whole the number is 64%

Presumably, as Medicaid recipients already have health insurance - i.e. Medicaid - they will not be affected directly by the mandate nor much, if at all, by the rest of the Act.

Those not poor enough to qualify for Medicaid, may have an even larger representation of Whites, but I haven't looked that up as it seems to involve categories that are harder for me to define and get thus to get the relevant information. If so, and if the primary beneficiaries of the Act are those currently uninsured or under-insured, then it may well be that the primary beneficiaries of the Act are not people of color.

Source:
http://www.statehealthfacts.org/medicaid.jsp

Percent of Medicaid recipients who are white:

US as a whole 64% of Medicaid recipients are white

VA -- 66% white
NY -- 59% white
TX -- 42% white
IL -- 66% white
OH -- 82% white
CA -- 41% white

Tyler

Sir,

I feel as you say many do: that this is just another giveaway to the democratic base in the form of wealth redistribution through taxing the 'haves' and giving the money to the poor in the form of welfare, SNAP (food stamps), and now health care. Any attempts to reign in the excesses of these systems (for reference, New York and Oregon questioning the use of EBT/SNAP cards in strip clubs and casinos) results in the usual suspects screaming about how rayciss people are.

I would have felt differently if this had been a single payer system, but this just seems to be a mess that combines the worst excesses of our 'old' system with the worst aspects of socialized medicine, as well as ignoring the unique problems we deal with in America. For example, illegal immigrants who use emergency rooms as a one stop shop. Do we offer them government health care now? Are we the caretakers of Mexico's citizenry now?

turcopolier

Jonathan

"There is perception and then there is reality." Joe Bob Newman. pl

Laurie

With all due respect, I am one white middle-class woman who supports the ACA as an imperfect beginning of comprehensive healthcare reform. Just looking at my own family, it means that my brother, who has pinched pennies and saved, can retire early. It means that should I find myself unemployed, I won't have to worry about my pre-existing conditions preventing me from getting insurance. (I have mild asthma and am a cancer survivor.) I am hopeful that my employer, who spends about $10,000 per year on healthcare premiums for me and my family, will see a reduction in cost down the road.

Regarding income transfers and all that, I suppose the thought that there is some undeserving poor person benefitting from the fruits of middle-class industry upsets some people. I'll accept that risk for myself, along with the knowledge that my tax dollars are also being transferred to some rich person who is equally undeserving. (Just what is my share of the tax deductions the Romneys get for their horse?) I work with poor people. The vast majority are very hard working. They just don't get paid a lot, certainly not enough to afford bloated healthcare premiums. (Look up videos on Remote Area Medical if you want to see the faces of America's poor.)

The Moar You Know

"rayciss"

Boy, that's kind of a dead giveaway, my friend. I only know a few places on the webs where that sort of language is used. Might want to be more...cautious.

The Moar You Know

"These employers would like nothing better than to rid themselves of the cost of insuring their employees."

I spend more on my people's healthcare than I spend on all the leases for my company's offices! Even worse, I know what my year-over-year increase in office lease costs is. Right in the contract.

But not health care. I have a pretty good idea of the health increases - at least triple the increase in my lease payments, 12 to 20% - but don't know for sure until I sit down with my insurers EVERY YEAR and hammer it out. In what world is that sane? It's my largest non-payroll cost, period. You're damned right I want to be rid of that. Imagine what I could do with that money! R&D, process improvements, a new floor downstairs...hell, maybe I could buy the wife a new car someday.

turcopolier

Laurie

You are pushing my tolerance. You are yet another person who cannot distinguish between advocacy and analysis. pl

turcopolier

TMYK

"raciss?" You are picking on tyler becausde of spelling?

Once again, you are not allowed to insult people here because you disagree with them.

TMYK. Don't do it again. pl

Amir

If cost efficient healthcare is the goal, I would like to refer to Physicians for National Health Program website ( http://www.pnhp.org ) for more information.

In comparison with the above mentioned law, Pres. Obama's law is has a higher administrative burden and associated cost.
I have the impression that people confuse Single Payer Universal Coverage with "socialism". I happen to have knowledge of Belgian and to a lesser extent from Dutch system.
The government is acting as a clearinghouse but private insurance is freely available and tops the basic provision.

In comparison with the current law, I do not think cost will increase at all. Currently, EMTALA assures that everyone gets care when they are sick, as long as they present to the Emergency Room, regardless of the financial situation. This leads to overexposure to unnecessary and expensive tests as "when you have a hammer, everything looks like a nail". The burden is carried by the local, state and federal government anyway.

Obama built in additional conditions for use of IT, centralization of information, creating of electronic medical record, interoperability of systems between different hospitals and soon between states, into the law. This will be achieved initially through financial incentives initially when one complies and after a while through financial disincentives when not complying.

If anyone is interested in learning more about the IT part of the law, I refer them to Prof. Minear, who helped in setting up the University of California health IT network in Davis and currently teaches at Hopkins regarding EMR modalities.

Combination of the approach pursued by PNHP and IT input could potentially assure that US have full coverage with a discount. At the end of the day, The Nederlands spends 1/3 to 1/2 of the USA on healthcare while having universal coverage. Whether it is going to happen, is a different matter.

turcopolier

Jonathan

I really am slowing up. Your percentages are of what real numbers and what are those numbers as percentage of the actual populations of the country and the states by race? pl

Medicine Man

http://www.urbandictionary.com/define.php?term=Rayciss

Will Reks

I had read that a lot of Medicaid funds go towards the elderly as well. Primarily to help folks with assisted living/nursing home expenses.

Get rid of these programs and the people will wake up to their social reality. This stuff isn't just for the poor.

mbrenner

Here are a few facts that may help our discussion.

‘Whites’ constitute 50% of today’s Medicaid recipients.

The estimated total cost of the subsidies that would be required to cover the insurance costs for the additional recipients for the 9 year period 2014 – 2022 (inclusive) is roughly $770 billion.

That figure is less than the full costs over time of our lark in Iraq.

That figure is less than the Bush tax cuts.
Annually, that comes to roughly $90 billion a year or 6.7% of our current annual deficit. This figure does not include penalties collected from those who refuse the mandate.

Here in the Lone Star state, the politicos are prodding the enraged citizenry to march on Washington – even after opting out of the Medicaid addendum as the Supreme Court allows. 18% of its population currently participates in Medicaid. About ten percent of that number could even ride a horse to Washington – with George W. Bush among the equestrian challenged.

Were Texas to participate in the Medicaid addendum program, it could add another 2 million or so, raising the percentage of population covered to 26%. At this moment , 6.2 million, about 25 percent, of Texans are uninsured, Texas is in the top 3 of states rated by incidence of illness and disability.

The cost for covering Texans in the Medicaid addendum would be in the vicinity of $5 billion per annum. 92% of that would be paid for by the federal government. That would leave $400 million.

Gov. Rick Perry, who is vocally opposed to the law, said Texas can "deliver health care more efficiently, more effectively and cheaper than the federal government can." In his 12 years in office, he has taken no step to demonstrate that. The same arithmetic and political logic is playing itself out across the region.

fanto

All, I read all the comments and I see that you all are not noticing the huge white elephant in the room - what about the 700 billion dollar/year defense budget,(not counting the other billions hidden in the other departments such as Dept. of Energy, which runs the nuclear armamentarium and R&D for it) - if that budget would be looked at - the Medicare and Medicaid could be properly adjusted as well, and this is my analysis.

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