By Christopher Jacobs • The Federalist
The Center for American Progress proposed a plan for government-run health care Thursday, which the liberal think tank calls “Medicare Extra.”
Unlike Bernie Sanders’ single-payer system, which would abolish virtually all other forms of insurance, the plan would not ban employer coverage outright — at least not yet. In broad strokes, CAP would combine Medicaid and the individual insurance market into Medicare Extra, and allow individuals with other coverage, such as employer plans, traditional Medicare or VA coverage, to enroll in Medicare Extra instead.
Page 4 of the proposal makes it clear this plan is not moderate, and it would shift the health care market firmly into the government’s control: “Newborns and individuals turning age 65 would be automatically enrolled in Medicare Extra. This auto-enrollment ensures that Medicare Extra would continue to increase in enrollment over time. [Emphasis mine.]”
The goal of CAP’s plan is to grow government, and to grow dependence on government. The paper omits many important policies, such as how to pay for the new spending. Here are some of the major objectives and concerns.
If You Like Your Obamacare, Too Bad
After attacking Republicans for wanting to “taking away health insurance from millions,” CAP would … take away health insurance from millions. The plan would effectively eliminate Obamacare’s insurance exchanges, and all individual health insurance: “With the exception of employer-sponsored insurance, private insurance companies would be prohibited from duplicating Medicare Extra benefits, but they could offer complementary benefits during an open enrollment period.”
Other sections of the plan (discussed further below) suggest that private insurers could offer Medicare Choice coverage as one element of Medicare Extra. CAP indicates that persons purchasing coverage on the individual market would have a “choice of plans.” But didn’t Obamacare promise that already — and how’s that working out? For that matter, what happened to that whole “If you like your plan, you can keep it” concept?
Moreover, the plan would also “integrate” Medicaid into Medicare Extra, “with the federal government paying the costs.” CAP provides few details on how exactly that “integration” would work, but suffice it to say that the able-bodied adults covered by Obamacare’s Medicaid expansion could face some interesting transitions as a result of this plan.
Mandatory Health Insurance — And A $12,550 Tax
The plan reinstates a mandate to purchase health insurance: “Individuals who are not enrolled in other coverage would be automatically enrolled in Medicare Extra … Premiums for individuals who are not enrolled in other coverage would be automatically collected through tax withholding and on tax returns.”
While the plan says that those with incomes below the tax filing threshold “would not pay any premiums,” it excludes one important detail — the right to opt out of coverage. Therefore, the plan includes a mandate, enforced through the tax code, and with the full authority of the Internal Revenue Service. (Because you can’t spell “insurance” without I-R-S.) The plan indicates that for families with incomes between 150 and 500 percent of the poverty level, “caps on premiums would range from 0 percent to 10 percent of income. For families with income above 500 percent of [poverty], premiums would be capped at 10 percent of income.”
In 2018, the federal poverty level stands at $25,100 for a family of four, making 500 percent of poverty $125,500. If that family lacks employer coverage (remember, the plan prohibits individuals from buying any other form of private insurance), CAP would tax that family 10 percent of income — $12,550 — to pay for its Medicare Extra plan.
Moreover, the plan does not specify whether it caps the 10 percent threshold for families over 500 percent of poverty at the actual cost of premiums. (For instance, would a family with income of $200,000, but premium costs of $15,000, pay only their premium cost of $15,000, or $20,000 as 10 percent of their income?) If the latter, it would represent an even greater cost on middle-class families.
Wasteful Overpayments Controlled By Government Bureaucrats
As noted above, the plan would allow insurers to bid to offer Medicare Choice coverage, but with a catch: Payments provided to these plans “could be no more than 95 percent of the Medicare Extra premium.” CAP claims that “this competitive bidding structure would guarantee that plans are offering value that is comparable with Medicare Extra.”
It does no such thing. By paying private plans only 95 percent of the government-run plan’s costs, the bidding structure guarantees that private plans will provide better value than the government-run plan. Just as CAP decried “wasteful overpayments” to private insurers in Medicare Advantage, the CAP proposal will allow government bureaucrats to control billions of dollars in wasteful federal government spending on Medicare Extra.
Costs To States
As noted above, CAP envisions the federal government taking over Medicaid from the states, “given the continued refusal of many states to expand Medicaid and attempts to use federal waivers to undermine access to health care.”
Translation: “If you don’t do exactly what we demand, we will punish you.” For a similar reason, the paper notes that legislation implementing the plan should “leave little to no discretion to the Administration on policy matters” — because Congress doesn’t try to micro-manage enough of the federal government as it is.
But the plan also requires states to continue to make maintenance-of-effort payments even after the federal government takes Medicaid away from state jurisdiction. Moreover, the plan by its own admission “giv[es] a temporary discount [on the maintenance-of-effort provisions] to states that expanded their Medicaid programs” under Obamacare — effectively punishing states for a choice (i.e., to expand or not expand) that the Supreme Court made completely voluntary. And finally, it requires “states that currently provides benefits … not offered by Medicare Extra … to maintain those benefits,” leaving states perpetually on the hook for such spending.
Would Employer Coverage Really Remain?
The plan gives employers theoretical options regarding their health coverage. Employers could continue to offer coverage themselves, subject to certain minimum requirements. Alternatively, they could enroll their employees in Medicare Extra, with three possible sources of employer funding: Paying 70 percent of workers’ premiums, making maintenance-of-effort payments equal to their spending in the year preceding enactment, adjusted for inflation, or “simpler aggregated payments in lieu of premium contributions,” ranging from 0 to 8 percent of payroll. (The plan would exempt employers with under 100 full-time equivalent workers from making any payments.)
Two questions linger over these options: First, would employer coverage remain? CAP obviously wishes that it would not in the long-term, while recognizing the political problems associated with an abrupt transition. Second, could employers game the system among the various contribution options? While details remain unclear, any plan that sets up two systems (let alone four) represents a classic arbitrage opportunity. If employers act rationally, they could end up reducing their own costs in a way that significantly increases the federal government’s obligations.
Higher Health Spending
CAP advertises its plan as providing “zero or low deductibles, free preventive care, free treatment for chronic disease” — the source of 75 percent of American health care spending — and “free generic drugs.” It would also expand coverage of long-term care services not covered by Medicare (and only partially covered by Medicaid). But all this “free” stuff won’t come cheap.
In analyzing Bernie Sanders’ health care plan, the liberal Urban Institute estimated that it would increase overall health spending by 22.1 percent. Notably, the Urban researchers estimated that Sanders’ plan would raise spending by people who currently have health insurance by almost the same amount, or 15.1 percent, because the lack of cost-sharing will encourage individuals to increase their consumption of care. With the CAP plan apparently proposing that government fully subsidize more than three quarters of health care spending, its proposal will increase health care costs almost as much as Sanders’.
The CAP plan proposes measures to lower costs — namely price controls (i.e., Medicare dictating prices to doctors, hospitals, and drug companies), with some token references to other policies like bundled payments and limiting the tax preference for employer-sponsored insurance. But if those proposals go the way of Obamacare’s “Cadillac tax” — potentially never implemented because politicians of both parties lack the discipline to control health care spending — then the plan will only raise health costs rather than lower them.
Something For Nothing
The plan proposes that families with incomes below 150 percent of poverty ($37,150 for a family of four this year) pay for their coverage the princely sum of … zero dollars. No premiums, no deductibles, no co-payments. Zero. Zip. Zilch. Nada.
And while CAP does not include specific ideas to pay for all the associated new spending, the concepts it does propose largely involve taxing “the rich” (which includes small businesses).
While it doesn’t work as it should — most people “get back” far more than they “pay in” — at least Medicare makes an attempt to have all individuals pay for coverage through the payroll tax. CAP’s plan amounts to a transfer of wealth from one group to another.
Even The New York Times this week highlighted dissent from middle-class families upset at the thought of having to pay for low-income individuals to receive “free” Medicaid. So, CAP might want to rethink what Bill Clinton called “the craziest thing in the world” — making middle-class families pay even more for mandatory insurance ($12,550, anyone?) while certain families contribute not so much as a dime for coverage — along with just about every other element of its health care plan.
There appears to be a dark money campaign seeking to influence public comment on the FCC's Restoring Internet Freedom order.
By Peter Roff • US News
Despite the Federal Communications Commission’s repeal of the doctrine known as “Net Neutrality,” the fight over control of the internet continues. Chairman Ajit Pai’s courageous leadership has been met with sustained resistance from those who would rather see the world’s most ambitious electronic commercial and communications platform regulated like it were Ma Bell.
Pai has been subjected to continuous abuse. Pickets have been mounted outside his home. The safety of his wife and children have been implicitly threatened. He’s been subjected to a campaign of constant harassment and yet he has persisted because of his firm belief he is in the right. That campaign of harassment is now headed to Capitol Hill, which unsurprisingly has been flooded with letters in anticipation of the FCC’s publication of its order Restoring Internet Freedom which finally appeared Thursday in the Federal Register.
The letters claim the Congressional Review Act would protect net neutrality – generally understood as the principle that internet service providers should not be allowed to block, throttle or censor lawful web traffic on their networks.
For reasons that therefore should be obvious, the Restoring Internet Freedom order isn’t popular among the coalition of Silicon Valley tech giants and far-left pressure groups that lobbied the Obama administration to regulate the Continue reading
By David Harsanyi • The Federalist
This week, CNN fact checked Donald Trump’s recent claim that he had been tougher on Russia than Barack Obama. “(No he wasn’t)” maintained the cheeky chyron. Though the network fancies itself the arbiter of truth in the Era of Trump — apples and bananas and all that — this particular contention is, at the very least, debatable. In fact, there’s a good case to be made that in nearly every way, save rhetoric, the president has been tougher on Russia than his predecessor.
This isn’t necessarily a heavy lift when we consider Obama spent most of his eight years placating Vladimir Putin and his allies in the Middle East. Much of the trouble we find ourselves in now can be directly traced to Obama’s feckless policies.
By the time Obama let Putin’s stooge Dmitry Medvedev know that the administration would have more “flexibility” on missile defense, the president had already canceled the sale of American missile-defense systems to our allies in Poland and the Czech Republic. This pleased Putin greatly. At the time, Obama and his allies were Continue reading
By Bill McMorris • Washington Free Beacon
The unions behind a failed challenge to Kentucky’s right-to-work law are appealing a state judge’s ruling on its constitutionality.
Teamsters Local 89 and the state chapter of the AFL-CIO, America’s largest labor organization, filed an appeal Tuesday to the Kentucky Court of Appeals seeking to overturn Franklin Circuit Court judge Thomas Wingate’s dismissal of a suit challenging right to work. Wingate tossed the suit on Jan. 23 after determining the unions failed to demonstrate that the law, which prohibits union fees as a condition of employment, illegally deprives the union of its private property.
“The KRTW Act does not violate the equal protections afforded by the Kentucky Constitution, nor is it special legislation that was enacted,” the ruling says. “No genuine issue of Continue reading
The Trump administration moved Tuesday to allow health insurers to sell lower-cost, less-comprehensive medical plans as an alternative to those required under ObamaCare – in a plan that drew swift protest from congressional Democrats.
The proposed regulations would allow insurers to sell individual consumers “short-term” policies that can last up to 12 months, have fewer benefits, and come with lower premiums.
The plans also would come with a disclaimer that they don’t meet the Affordable Care Act’s consumer protection requirements, such as guaranteed coverage. Insurers could also charge consumers more if an individual’s medical history discloses health problems.
But at a time of rising premiums, Trump administration officials touted the option as a boost for those who need coverage but don’t qualify for the Affordable Care Act’s subsidies and would otherwise face paying the full premium cost.
By Dr. Miklos K. Radvanyi • Frontiers of Freedom
The greater Middle East that Turkey is historically, politically, and religiously has been a part of, presently passes through numerous overlapping and extremely bloody crises. Divisions between those countries that are desirous to maintain the status quo and Iran that wants to radically transform the region to its advantage are running deep. Moreover, at least since 2011, the region has been broken up between those regimes that desire to arrest the flow of blood and reestablish peace, and those that promote the religious ideology of Divine right by their military might. Finally, the states involved in this life and death struggle have been busy to put together shifting alliances that only contribute to the overall chaos and anarchy.
The entry of Turkey into this mess following the eruption of the so-called Arab Spring has been an unmitigated disaster for the country and also personally for President Recep Tayyip Erdogan. Having been driven by his messianic Ottoman and Islamist mentality, President Erdogan has failed to comprehend the difficulty of gaining any real influence over the ethnically and religiously diverse fellow rulers who are shaping events across the region and beyond. Clearly, with the notable exception of the United States of America and Israel, it appears that it is the ruling Shi’a clergy in Iran and the Sunni rulers throughout the Arabian Peninsula who are exciting their peoples, and decisively dominate the political narratives. In this context, the policies of President Erdogan has too much the appearance of Ottoman restoration.
Brian Ellis • Investor’s Business Daily
Employers have until Thursday to implement new tax withholding guidelines, which determine how much they withhold from pay for federal taxes.
Fortunately for many Americans, job creators are already seeing lower rates and distributing larger paychecks. Treasury Secretary Steve Mnuchin estimates more than 90% of working Americans will see greater take-home pay because of the Tax Cuts and Jobs Act’s new withholding guidelines.
It’s further proof that tax cuts are working for the middle class. To date, more than 330 U.S. employers have publicly announced tax-induced wage hikes, 401(k) increases, and generous bonuses. While Apple and Wal-Mart grab the headlines, many beneficiaries of the Republican tax bill are small businesses, which account for two-thirds of new jobs in the country.
Missouri-based Dynamic Fastener, a construction hardware supplier, is rewarding employees with bonuses of up to $1,000, while also opening a paint shop, buying new equipment and Continue reading
By Shadi Hamid • The Atlantic
The mob was unusually vociferous, even for Twitter. After the California-born ice skater Mirai Nagasu became the first American woman to land a triple axel at the Olympics, the New York Times writer Bari Weiss commented “Immigrants: They get the job done.”
What followed that innocuous tweet was one of the sillier, manufactured controversies I have ever seen on Twitter. Twitter’s socially conscious denizens probably only realized they should be outraged at Weiss after they saw other people being outraged, as is so often the case. Outside of Twitter, some of Weiss’s Times colleagues were also offended by the tweet—and even hurt by it. The critics’ objection was that Nagasu isn’t herself an immigrant, but rather the child of immigrants, and so calling her one was an example of “perpetual othering.”
I, too, am the child of immigrants. And if I was an Olympic figure skater and people associated me with immigrants—or called me an immigrant outright—I wouldn’t think twice. I would take it as a compliment, particularly because immigrants are one of the main reasons America is great.
Perhaps Weiss should have acknowledged Continue reading
By David Harsanyi • The Federalist
There’s always a lot of emotion after a horrific school shooting, and that’s completely understandable. There is also an immediate push for vague “do-something” gun-control legislation often wholly untethered from the incidents it is purporting to stop, which is less understandable. Worse, most of these efforts are bolstered by falsehoods and half-truths that make it virtually impossible to have a genuine discussion about the problem.
It’s an endless task, but let’s just take Joe Scarborough’s Washington Post column on the Parkland shooting as an example, since he uses a couple of the most fraudulent talking points about modern gun ownership.
The former GOP congressman, who once voted to repeal the “assault weapons” ban and never once “stood up” to the boogeyman NRA when there was any political risk, tells us he’s a “reasonable” conservative who believes in the Second Amendment. “I was relieved the court confirmed that citizens have a constitutional right to possess handguns at home for the purpose of protection,” Scarborough writes about the 2008 Heller decision.
That’s nice. But while Scarborough’s exceptionally narrow definition of Heller — possess handguns at home for the purpose of Continue reading
Taxes: A new “study” in Britain suggests that by raising taxes sharply on Facebook, Amazon and Apple, the government could pay for a universal basic income (UBI) for all Britons. It’s an absurd idea, which is why it can’t be counted out.
The so-called FANG companies — the above-mentioned three, plus Google and Netflix — have been vilified now for years in Europe and in the U.S. as “monopolies” and, worse, “predators.” When such strident rhetoric is used by politicians, you know they’re going in for the kill. There’s money to be made in taking down big, successful companies.
In the case of Britain, the left-wing paper The Guardian reports, the Royal Society of Arts (that’s right, Arts) recommends that “Britain could raise new taxes on Amazon, Facebook and Apple to give every citizen under the age of 55 as much as £10,000 ($14,000) in a form of universal basic income … helping to counter the growing risk of job losses from automation and artificial intelligence.”
America’s FANG tech companies look like easy victims. Inevitably, since they have little in the way of a domestic British constituency, they will come into the cross hairs of Britain’s tax-happy, left-wing politicians. Continue reading