Another health care rant.

I don’t approve of using the insurance industry to pay for health care reform. That’s thirty percent of our medical care dollars going into corporate coffers, and enough money each year to pay for healthcare for all the deadbeats the industry keeps telling us are out there trying to steal our hard-earned insurance dollars.

I think that the health care insurance industry is just another corporate Colossus that has managed to completely separate health care costs from market realities, and will continue blindly jacking up the price of health care costs until the system breaks down.  Not the value of health care, just the cost of it.

I think that the federal government should go into competition with AETNA, and set out to win. If laissez faire is so fair, if private business is so much more effective and competitive, then AETNA will win out in the end against those lazy bureaucrats in the public sector, and find ways to make sure private citizens can afford health care programs that won’t vanish when things get ugly, and the patient becomes too weak to hold his job.

I think that the federal government ought to be in the business of keeping successful and competent obstetricians from having to pay a couple hundred thousand dollars a year in malpractice insurance, because they have to protect themselves from desperate customers who’ve lost everything, and a loved one, paying for an unsuccessful outcome.  That is just plain sad and sinful.  The reason so many health care professionals want reform is because they aren’t getting the money we pay for our care. Insurers, boards of trustees, and lawyers are getting more health care dollars than many of our doctors are.  Let’s face it.  Americans spend 16% of the largest GNP in the world on health care. That is the largest percentage of the very largest GNP going, and we aren’t living any longer than any of the other first world nations.  That is probably because our medical care providers are paying half of their income into what amounts to a protection industry.  Call it what it is: a protection racket.

As individuals, we cannot control the collective might of the corporate insurance industry.  Medical Insurance invalidates the entire concept of market forces at work when it comes to controlling prices.  It’s time and past time to put our federal government to work sorting out the morass of insurance industry malfeasance that is slowly but inexorably making health care something that only the wealthiest of our children will be able to afford.

Lemonade or Grape flavored?

I woke up this morning to a lie from the political party I most side with. Guy Cecil from the Democratic Senatorial Campaign Committee wrote to tell me that the “Republicans are so against funding women’s healthcare that they would shut down the federal government over it.” He was lying, and we both knew it. Of course, he probably thought I didn’t, but that just goes to show the incredible gall many politicos have — the unvarnished disdain they have toward their constituency.

If it wasn’t for the serious avalanche of tripe my tea-partying friends are swallowing without any hint of critical appraisal, I’d be more angry with my party. Instead, I’m mildly disgusted, but mostly just worn out. I guess when it comes down to it, the Democrats aren’t my party. They’re just the team that pisses me off the least, this year.

I voted for Barack Obama, even though I’ve always liked John McCain. I’ll vote for Obama again in a year or so, even though I think he’ll lose. I admire the fact that he put his own political career in the shredder to push through a health care bill that we badly need, as a people, if health care is to remain available to everybody. We need to begin thinking of health care as a necessary public service like electric power or running water, or long and healthy life will become the special domain of the wealthy, an elitist privilege.

But President Obama told us that he could be a bipartisan president, at the same time as the DNCC was pushing me for donations to make sure that the Republican’s were so outnumbered that they couldn’t even front a filibuster when “my” party of the moment wanted to have a free hand at whatever legislation they wanted to pass.

As it happens, I don’t want to turn my guns over to the democrats any more than I want to watch the Republicans walk us in lockstep into their most desperately, trenchantly, right leaning members’ idea of a moral utopia. Abortion is not murder — probably 30% of all first pregnancies self terminate. That whole argument is stupid — God isn’t murdering those miscarriages. We are a Christian people, but not a Christian country, and our founding fathers made sure of that. Funny how the wisdom of the founding fathers is plenty of excuse to allow the poor to starve or freeze to death without public aid, but inadequate to bind the country to remaining religiously tolerant.

When it comes down to it, both sides are grandstanding to get attention. If the Republicans blew off their most rabid supporters, and the Democrats really tried to figure out why the Republican middle doesn’t want to give up their guns, give up their sense of traditional values, home as castle, etc, then maybe we could move forward on some really important things.

I don’t want to spend $4.10 per gallon for the privilege of burning Exxon’s industrial waste in my car. I want Shell to use that oil for important things, and treat gasoline as the industrial waste that it is. I want BP to acknowledge that most of the gasoline we burn is something they would otherwise need to dispose of themselves, and stop playing cynical games with charging the absolute maximum they can get from us. Yes, it is possible to engineer a crash in the U.S. economy by charging enough for gasoline.

Wallstreet crashed twice in the first decade of the 21st Century, and we pretend that there is a reason to argue about regulating that place. Most of my friends who lost money during those crashes have never recovered their basis. I had almost recovered my investment from the first crash at the beginning of the decade when the next one hit at the end of the Republican monopoly on congress. Both sides of the fence look away from the fact that the stock-market is just legalized gambling. There are legitimate stocks available for purchase, but most of what goes on there is just addicted gamblers pushing paper around, hoping that their scrip will sell for more of more than it is worth than they paid for it. When the stock market isn’t in freefall, it bounces ten percent on some days. This is not a viable place to keep any money that isn’t absolutely available to be lost.

One of my best retired-military friends owns a bar and grill in Oregon. He spends more on his cook than he earns for himself. His costs are mostly in the form of required benefits, and unless the economy goes back into overdrive, he’ll probably end up selling the place. Too many social programs are being paid for by small business owners.

My sister has lived in and around San Francisco for ahem years. She spent about twenty of them in the food service industry, working three or four jobs at a time. A huge chunk of the food service industry in that area can’t afford full time employees because of the required benefit packages. They avoid that by having five employees doing the job of two full time employees, so that nobody goes over half-time.

A lot of people want to argue that laissez faire business without legal controls is the only way to make the country work, because that’s the way it was when Beaver Cleaver was a sprite. Big business wants us to believe that, because it does work out well for big business. Unfortunate, really, that there isn’t enough big business to go around. But millions, maybe even billions, of dollars are spent to keep the American people from recognizing just how far from true it is that the board of directors or stockholders of GM care a whit about the twenty people who applied to work for that company but were turned down for every one person who actually found employment there. The mobilization of money, deceit and influence that went into fighting health care reform was awe inspiring, and continues to be intimidating, especially when you consider that health care reform is saving lives, and that with some concerted effort on the part of lawmakers, could be economically freeing for 99% of the people in this country, without putting anybody at all in the poor house. This is particularly agonizing to me, since it would work so much better if there weren’t so many people trying to get it to fail because it originated in the wrong camp, and not because it’s a bad idea. Health care reform is a stellar idea, and most of the people in the health care industry approve of it.

Why is it so very easy for me to find out how much money the average American makes, and how many of us there are, and what the average family earns, but so impossible for me to find out how much money the US corporations make, and what portion of the U.S. economy is tied up in corporate accounts? That question practically answers itself. We have big problems in this country, both sides of the political divide are fully aware of it, and they’d rather keep us fighting about abortion, entitlement mentality, and freedom of religion than turn our corporate gaze on what was really going on during the budget crisis this week. The Republicans and the rebranded republicans in the Tea Party were pissing on the American people with lemonade flavored piss. The Democrats were pissing on the American people with Grape flavored piss. But it was all piss.

Air Rage: Short term memories, long term profits.

When I was a kid flying around the world in cabin class, I can remember climbing into a BOAC VC-10 and being appalled that the seats were so narrow. I don’t think that I’d be appalled by that today. I think that the US airlines picked up the habit of shrinking seats sometime in the last thirty years, and that the Airline Rage that everybody blames on rude passengers is largely what I’ll call caged rat syndrome. Put enough rats in a small enough box, they’ll go nuts and start eating each other. I think it can happen to people, as well.

When I was a kid, six-foot tall men could sit upright in passenger class on most US airliners without their knees pressing into the back of the seat in front of them. I’m lucky, I’m only 5’7″, and I still don’t have my knees pressed into the seat in front of me. But 6 feet isn’t an unruly height for an average European American, and six footers spend entire flights feeling their knee-caps being slowly misshapen by the seat in front of them.

My most recent several flights have been aboard the aircraft construction monopoly’s 737-800, and they’ve been very uncomfortable flights. The construction monopoly has solved the problem of passengers reclining their seats too far by the simple expedient of limiting that recline to about three or four inches. It isn’t quite far enough to allow me to lay my head back in the seat to take a nap. When I relax, my head lolls forward, so if I do get a nap, I wake up with a desperately stiff neck.

I’m reaching back into memory, since documentation isn’t hanging out in the internet, but my memory tells me that the average Boeing 747 that sold on the US market in the 1970s seated about 435 passengers. Today that same airframe seats at least a hundred more people. The airlines complain that Americans are suffering greater girth to height ratios than they did a couple generations ago, and that is no doubt true. But those airlines cleverly ignore the fact that they’re crowding more bodies into the same airframes and expecting us to be just as comfortable. Add ineffective hypersecurity at the gates, and extra charges for meals, luggage and movies that come in boxes for a relatively small percentage of passengers. Then add in the fact that the authorities blame the passengers for air rage, which means that a pissed off cabin attendant can pour a cold coke in somebody’s lap, then have the passenger escorted from the plane if he barks or airs a grievance.

Air rage may be unacceptable, dangerous to other passengers, and childish. Still, given the 100% full red-eye flights that I’ve taken the last several times I’ve flown out of Alaska, with short me suffering far less physical aggravation than most of the Alaskans on those planes, I have to suggest that Airline Rage is also absolutely predictable, unavoidable, and fully preventable.

Screw the first responders! We have millionaires to protect!

Welcome back Republican Senators. President Obama will surely respect your strength. He fairly gave up a second term to see through the first step on the road to national health care. You filibustered the 9/11 first responders in order to make sure your millionaire buddies don’t face a tax increase. I understand. You’re afraid that the greater body of American millionaires will flee the country in despair if they’re forced to lie about 1% more of their incomes at tax time The lies they’ve generally told for years to make sure their real taxes run 10% or less are nothing compared to the insult of having to lie about 1% more. A tough decision, just like the president made. I hope those millionaires appreciate your unstinting sacrifice, you know, in letting New York first responders die and bankrupt their families trying to pay for medical care for the cancers and heart/lung conditions they developed while responding to what you call the first battle in the war on terrorism.

I admire your stances on party solidarity. While I’m not sure you really earned your pay as senators, I think you’ve more than earned your campaign contributions and side incomes. I’m sure several of you have bright futures with Halliburton and like industries.

http://gothamist.com/2010/12/09/gop_hates_sick_911_workers_filibust.php

http://www.thedailyshow.com/watch/thu-december-16-2010/9-11-first-responders-react-to-the-senate-filibuster?xrs=eml_tds

An Unholy Alliance: The insurance and litigation industries

A friend of mine recently commented that health insurance is a weird model for the insurance industry to follow, and I very much agree. His comment was a comparison between doctor visits and automotive maintenance, and the fact that you wouldn’t file an insurance claim for bringing your car in for scheduled maintenance.

My first response to that would be to note that some consumers can never afford general maintenance on their cars, so end up paying very big bills for things that wear out catastrophically, while other consumers either perform the maintenance, or pay somebody else to do so (I’m a chronic purchaser of maintenance), and don’t spend a lot on major maintenance. I think that the health insurance industry notices that it spends less on catastrophic care if customers get routine care. Since it is paid enough to support the risk of short term catastrophic care among the client base, any money saved by reducing cost of that care is money in the pocket. Simple economics, complicated by the uncomfortable fact that Blue Cross doesn’t really want to get out of the business of catastrophic care, because it’s a hugely profitable business – they want to get paid for covering and administering every catastrophic medical situation in the country.  My second response would be that my Toyota RAV4, no matter what damage has been done to it, isn’t going to cost $200K to fix. Repairing me is in an entirely different economic stratus.

The insurance industry as a whole has the risk of each medical transaction covered both ways, just like the neighborhood bookie (for those neighborhoods that have bookies. Mine doesn’t have a bookie – just an insurance broker). I pay an insurance company to cover my costs if I break my leg, or develop cancer; my doctor pays an insurance company to cover his costs if he either screws up my care, or if nature takes its course and I die, then some ambulance chaser convinces my wife in her grief that I shouldn’t have died; and I pay an insurance company to cover my costs if a moose wanders into my car on the road; the body shop which repairs my car pays an insurance company in case one of their guys forgets to replace a bolt, the bumper falls off, and takes out my exhaust system.

I’ve wanted to talk about the unholy alliance of the insurance industry and the Personal Injury lawsuit industry for some time. It’s become clear to me, though, that Insurance is an across-the-board contributor to escalating costs in virtually any market that it invades.

One secret that the insurance industry holds is pretty simple. Charge people a reasonable amount per year for whatever they want to be protected from, then, when disaster strikes, pay whatever the provider wants to charge. In a short time, years or decades, the provider will be charging far more for its service than a normal person can afford. THEN, everybody must buy insurance to use that service. Once providers are no longer subject to any market forces, it’s safe to crank up the premiums, because consumers can no longer pay for the service directly. I’m reasonably convinced that this isn’t done by any sort of conspiracy, but the insurance industry has a habit of destroying market forces.

Another secret: Lawyers add fun and profit to both sides of the insurance game. A friend got into a moderate to severe, no-fault, traffic accident. His major automotive insurance company was aware that he had military medical, so low-balled him on handling his care, as well as totaling his car out for about half the blue-book value. He paid a lawyer a few hundred dollars to draft a letter from a law office. The insurance company woke up. Lawyers had become involved, and they wanted to settle this amicably (read, for about thirteen thousand more than they would have paid my friend for the claim, otherwise). It’s awe inspiring the way purses open once the real blood-suckers have become involved. I say this not in disapproval, but in admiration. Once I get past the fact that J.Q public gets low-balled by default, by many major insurance companies, I admire the way they clean up their acts fast once they start to see shark-fins in the water. When it really becomes fun to read about is when the claim becomes large enough that both sides muscle up and get the lawyers aworkin’ the case.

A drunk carrying passengers runs a red-light in downtown Atlantic City, circa 1993. His car gets hit in the side by some commuter who has the nerve to actually go through a green light without stopping to look for crazy drunks in the middle of the afternoon. The uninsured drunk is effectively penniless, and his passengers have been injured (no fatalities.) A Personal Injury law-firm takes on the case, and starts looking for deep pockets, meanwhile sending the passengers, and the drunk, out to specialists to determine how much care will be required. Injuries, bad dreams, damage to goods. The PI firm (my wife was working for them at the time) settles on the municipality as the only available deep pockets. The city does a rough calculation, based on effectiveness of the particular PI firm, and various other factors, and settles the case for about $32K in cash, and rehab for the drunk. I say about because the final take was sealed, but that was about the amount the PI firm needed to take a third of in order to turn a profit, and they did turn a profit, but not a drinking champagne profit. The PI firm’s claim was that the light had turned red too quickly (yellow light too short in duration) and that the drunk wouldn’t have had time to stop if he’d been sober. The fact that the intersection didn’t generally produce an unusual amount of accidents just never weighed into the equation. The factor to consider was court cost to defend the city, verses immediate layout to make the case go away. It was cheaper to pay out than it would have been to spend a couple days in court while the PI company rolled out its display of expert witnesses and crying victims. That PI company had a very good record of success, so the municipality folded before a single witness was heard, or even a jury empanelled. I can’t say for sure, but the odds are pretty good that the fully insured driver of the other car got less recompense for the incident than did the drunk who jumped out in front of him.

At that time, NJ was the most litigious state in the country, so that sort of consideration probably came into play more often there than in other places, but the concept is pragmatic reality in modern litigation. But where does that leave me? As a member of the general public, I need to be insured against being hit by uninsured drivers, because that is a separate insurance from liability, wherein the other guy gets paid for accidents that are my fault, or comprehensive, where the insurance company will pay for my damage if I screw up. It’s that middle ground, where I’m not at fault, but somebody else is. Lots of insurance companies demand that I file the claim for those against the other driver, and if the other driver hasn’t got a  sou, I’m SOL unless I’m paying for that special “underinsured driver” rider. If I have got the uninsured driver rider, then my insurance company becomes one of the deep pockets in the litigation dance.

If I ever end up in the cross-hairs of a PI firm, I’m all in. A 30K finding against me would probably bankrupt me and put me into foreclosure anyway, so I’m gonna be loading up for bear (hiring a lawyer), and engaging in the fight – regardless who is at fault. Those legal fees mount up fast as all get-out, but if I can get the thing laid to rest in the opening movements, I’m better off paying a few thousand dollars for that service than if I try to handle it myself. As my friend from the no-fault accident learned, even the people on my side of the argument are more forthcoming if I prove to have a pet shark on call.

So, without really believing there is a conspiracy, I have to note that the insurance companies and the litigation industry prop each other up. Insurance always has deep pockets, PI litigators can always find somebody who’s either been hard done by, or is simply pitiable and will look good in court. It’s cheaper to pay off the litigant and his lawyer than it is to fight the case in court, and take a chance that the poor drunk of the people will fare better with a jury of his peers than will the insurance company with it’s three piece suits and expert witnesses.

Here’s a bit from the National Association of Personal Injury Lawyers:

Personal Injury Settlements

Settlements occur before, during or after any lawsuit is filed. Experienced personal injury lawyers almost always seek this course first as it the fastest and easiest way to reach an acceptable conclusion for both parties. Negotiations will take place between personal injury lawyers who will then present the proposed settlement terms to both parties.

Now, here’s a bit from Monohan Law Practice, showing that personal injury cases are way down:

Payouts in Personal Injury Cases are way down too. The median payout for all personal injury cases dropped 56% between 1992 and 2001. The median inflation adjusted payout in all personal injury cases dropped by 56.3% in those same years to $28,000, according to the Bush Administration’s own study.

Oops.  Lawsuits are “way down” and payouts are only $28K, at median. Actually, formally filed lawsuits are way down. My phone book is still chockablock with yellow pages adds for lawyers who’ll take PI cases on spec. They ain’t going broke. I have no way to determine how many PI/insurance settlements are reached each year, because Google isn’t playing nice on those two questions, but I’m betting that the numbers are real healthy. A 28K PI settlement would pretty much put me out of my house, but I guess I’ll have to live with that risk.

The thing to notice though, is that whether it’s an insurance payoff or liability law-suit, the amount of money that changes hands, even when the defendant is completely innocent, would generally bankrupt me. If PI lawyers only had people like me to go up against, they would go broke. But insurance companies settle even questionable cases out of hand for amounts that would bankrupt me, and consider it cost savings.