Tobacco Tax Is a Win for Georgia

Guest Blog By Michelle Putnam, MPH

For those inclined to live under a rock, the state of Georgia is in a deep recession, with revenues steadily declining over the past year and showing no sign of recovery.  In Georgia, 20% of adults and 18% of high school students smoke, costing our $2 billion a year in smoking-related health problems.  Is there a magic pill that would solve both of these problems at once?  You bet there is.  I give you, the tobacco tax.



Is There Still Room for Compromise?

New York Times columnist Russ Douthat offers an interesting take this morning on how Republicans and Democrats might be able to work out a deal if both sides take the upcoming health care summit seriously.

Among his observations: “Actual negotiations would require that each party address the other’s frustrations. Democrats would need to put the overall structure of the bill up for debate, instead of just offering concessions around the edges. Republicans would need to show up with proposals that have more heft, and more bipartisan appeal, than their predictable calls for interstate purchasing and tort reform.”

— mike king

Rep. Price on GOP Insurance Proposals

By Mike King

I’ve put up several posts on the inadequacy of the Republican Party’s “better solution” for health care reform and questioned the GOP’s willingness to move to the center in an effort to find a bipartisan middle ground. Rep. Tom Price (R-Ga.), a physician by training and one of the House GOP’s point people on the issue, writes more about it in the conservative Web site, BigGovernment. I post it here so that readers can get the full flavor of the party’s position.

It will also give you an idea of how difficult it will be for the President and Democratic leaders in Congress to bring Republicans — who believe even though both the House and Senate have already passed versions of health reform — that the whole process needs to start over from scratch. Unless he is willing to do that, Republicans are threatening not to participate in the proposed health care summit Obama wants to hold Feb. 25, according to The New York Times.

Then there’s this, taken from Price’s post: “It appears this summit is simply an attempt by the President to use the White House as a political tool to intimidate his way into a government takeover of health care.  The American people and Republicans in Congress will not be taken by this Chicago-style politics.”

It doesn’t seem to matter that Price continuously lies about the proposed plans being a “government takeover” of the nation’s health care system (not even the insurance industry would go that far, much as less Big Pharma or the American Medical Association, which have endorsed the proposals.) All politicians are entitled to have an opinion, but we should be exceedingly skeptical of those who make facts up in order to score political points.  Thankfully, the Times, provided readers  context to some other of Price’s misrepresentations.

What Happens if Nothing Happens?

By Mike King

With the House and Senate health care reform bills stalled and Republicans insisting that the only way to get the reform effort moving again is to go back to square one, there’s a good chance that nothing will be accomplished during this election year. Opponents of health care reform, the Tea Baggers and a host of conservative pundits are OK with that, arguing that the system is not that flawed and that, given the national economy, the country can’t afford to do much else now.

But the cost of doing nothing will be substantial, as seen by recent developments in New York, California and Georgia.

Last week’s Georgia State University report  showed that the ranks of the uninsured swelled in 2008 to 1.67 million Georgians, an increase that took place well before the worst of the recession in 2009 when unemployment spiked above 10 percent. The hardest hit were workers at companies that employ fewer than 25 people, where business owners dropped health insurance plans that they could no longer afford. The state now ranks 9th in population but fifth in the number of residents without health insurance. This trend line has been going on for several years now. The recent efforts by the Georgia General Assembly to deal with the problem — by offering tax breaks to small businesses and individuals who purchase lower cost, high-deductible insurance plans combined with tax-exempt health savings accounts — have had no appreciable impact on the trend.

Meanwhile, as stimulus money runs out, the Medicaid rolls will continue to swell, leaving the state to pick up a higher percentage of the cost of providing coverage for the poorest of Georgians. The bills before Congress promise to pay 90 percent of the cost of expanding Medicaid in the states to more low-income residents, but if they aren’t approved, Georgia will have to pick up a much higher percentage of the cost for residents who qualify for the program under current income guidelines. That’s led to Gov. Sonny Perdue calling for a tax on the state’s hospitals and managed care insurers to offset the increasing Medicaid costs. If his plan goes through, it’s not unreasonable to think that many of those hospitals and insurers will pass on the cost of higher taxes in price increases to patients with insurance, thereby boosting the unsustainable “cost shifting” within the health care financing system that has caused much of the problem the reform effort is attempting to solve.

Evidence of that has already shown up in New York and California.

A major struggle between UnitedHealthcare and a consortium of big New York hospitals represents the kind of ongoing arm wrestling that will continue to take place if insurance reforms aren’t enacted. As reported in The New York Times, the standoff is over, among other things, what the hospital must do if a UnitedHealthcare patient shows up in the emergency room. The insurer wants to be notified quickly of a patient’s hospitalization to determine if it is medically necessary. If not, it told the hospitals, it will cut reimbursement rates for services provided to the patient in half. It’s unclear whether the patient who happens to be caught in such a dispute would have to pay the difference out of his own pocket or the hospital would have to eat the difference. But it’s important to remember that nary a government bureaucrat is involved in this free market dispute. Insurance bureaucrats and hospital bureaucrats will be skirmishing more and more in the absence of some regulatory authority that protects patients from the warfare between insurers and providers. (For a Georgia example of this, think about the dispute between Blue Cross and Blue Shield and Piedmont Hospital a few years ago — where thousands of Blue Cross patients were told to find non-Piedmont doctors — because the hospital and the insurer couldn’t agree on a new contract. They eventually worked it out, but without substantive reform, such disputes will no doubt get meaner and more frequent and leave patients trapped in the middle.)

More recently The Los Angeles Times reports that Anthem Insurance in California proposes a whopping 39 percent increase in premiums staring March 1 for some of the state’s 800,000 individual policy holders. The staggering increase has drawn the attention of state regulators as well as the Secretary of Health and Human Services Kathleen Sebelius. Bear in mind that Anthem is a huge, for-profit insurance company; not one of these fly-by-night, street-corner-sign private insurance vendors that rip off their subscribers with low cost policies that basically cover nothing. Anthem says that the increase is justified because more and more of its individual policy customers are sicker and need more medical services.

That’s what happens without health care reform. That’s what’s been happening for the last 20 years.

Mike King is a retired journalist who specializes in writing about health policy issues. He also serves as editor and administrator of the Healthy Debate blog.

In Raw Numbers, We’re 5th

By Cindy Zeldin

A new study released this week by Georgia State University found that, in sheer numbers, only California, Texas, New York, and Florida have more uninsured people than Georgia. That’s right:  we rank 5th in the total number of uninsured, but 9th in total population. Comprehensive health reform would provide affordable avenues to coverage for the vast majority of our state’s 1.67 million uninsured. Let’s get it done.