October 14, 2014 by JImbo
Don’t expect this before the election.
Don’t expect anything detailed or concise either.
However, in a nutshell I think I have a handle on how it would work (in theory.)
What is the “Manhattan Plan?” Well, that’s what I call it because it needs a better name than the “Universal Exchange Plan.” Since it comes from the Manhattan Institute, why not the Manhattan Plan? Kinda make people think it’s new, cool and innovative, like the “Manhattan Project” to make the Atomic Bomb?
Come up with your own name.
Anyway, there are five main parts to it:
1- Exchange Reform
a) Eliminates Individual Mandate
b) It keeps the exchanges (at the STATE level) to give people the option of buying government-subsidized insurance.
c) It eliminates many of the requirements for a plan to be an “official” gov’t sponsored plan.
How will this work? Ya got me on that one. The Individual Mandate forces people into the exchanges. Also, currently states that don’t set up exchanges aren’t required to. So…. if there’s no exchanges there’s no coverage for people?
Or would the Feds keep running THEIR exchange?
Then there’s the key issue that is still in the courts right now… as written Obamacare says government subsidies are only available “through State run exchanges.” Not he Feds. So, the Feds still haven’t figured out how to get around that one.
I still don’t see how anyone would get subsidies in states without State-run exchanges like Florida or Texas. If they have no State exchange and they can’t use the Federal exchange…. what happens then?
d) Expands health savings accounts (Now this I can see working well)
2- Employer-sponsored insurance reform.
a) Repeals the Employer Mandate
b) “Eliminates many taxes and regulations that drive up cost of employer based insurance”- hmmmmmmm. Now there’s that vague boilerplate I was talking about. Lots of saying nothing there and dreaming of utopia.
3- Medicaid reform.
a) Medicaid cases of “acute care population” moved to State Exchanges. (That is for emergency trips and short-term stuff like a broken leg) Still not sure how that will work with the whole Florida/Texas/etc no state exchanges.
b) In exchange, the States are responsible for all the long-term care Medicaid cases that the Feds used to pay for. So, nursing homes, elderly care, dialysis, etc. The costly, long-term stuff that is more or less permanent costs for really really sick people. Given that’s where MOST of your cost comes from, sounds like the States are gonna get hosed on this deal. I could be wrong, but that’s gonna be a non-starter for many states. (And again, what about states with no exchanges set up?) And is that still called “Medicaid” even though it’s NOTHING LIKE Medicaid now?
Medicaid is for the poor. Medicare is for the old. (The poor old can use both…kinda.)
The Plan gradually raises the Medicare eligibility age by four months each year. (Is THAT gonna fly? About as well as raising Social Security 4 months each year will!)
The end result is to preserve Medicare for current retirees, and to maintain future retirees—in the early years of their retirement—on their exchange-based or employer-sponsored health plans. (We’re to expect that elderly will stay on exchange plans instead of moving to Medicare insurance plans when they retire to Social Security. Not sure why they’d do that.. or how it saves money. Unless they’re expecting to “shift the load”… and keep people off the FEDERALLY funded Medicare rolls and keep them on the STATE PAID FOR Medicaid rolls for longer. It doesn’t really save money since you pay both Federal and State taxes, but it makes it look cheaper in the FEDERAL budget… I don’t expect the states to go for this one either.)
5-Other reforms. “The Plan tackles the growing problem of hospital monopolies that take advantage of their market power to charge unsustainably high prices. The Plan reforms malpractice litigation in federal programs. And it accelerates the pace of medical innovation through reform of the Food and Drug Administration.”
So… again pointless drivel that means nothing. No details for fear of pissing someone off. Basically they’re talk a lot and do nothing. As usual.
Chances of this plan doing anything?
VERY VERY VERY LOW.
It’s not inspirational. It’s even shorter on facts than Obamacare (if you can believe it!)
it’s not WORSE than Obamacare, but it’s not really an improvement. Just more big government trying to get in the way.
I still say a simple plan would work best. Something similar to what Dr. Ben Carson described a couple years ago.
Step 1- Set up a “Healthcare Savings Account” (HSA) for every citizen.
Step 2- Deposit an initial amount in it on creation (existing people now, new people as they become citizens or children are born.) ($10,000 maybe?)
Step 3- Add an additional amount every year per person. ($3,000 maybe?) Any amount not spent that year stays in the account and collects interest. Family members can “loan” or “transfer” money between accounts with permission of account holder or guardian in the case of children. Any account of a person who dies is inherited by heirs as any other financial assets would be. Physicians, hospitals, medical providers would be given special codes and these funds can ONLY be spent on medical procedures/products/etc.
Step 4- The HSAs are meant to cover 90% of the cost of “regular” doctor visits, minor accidents, and normal wear and tear. A high-deductible, catastrophic health care plan would also exist with a pool of EVERY AMERICAN CITIZEN. It would be suitably high ($10,000 maybe?) so that it would only be used in dire circumstances.
There would be no role for government beyond the initial setup and monitoring of the HSAs and catastrophic health care plan. Everything else would be free market.
Doctors, hospitals, etc would post their prices and leave it up to the patients to decide what they want to do. All bills would be itemized and the prices clearly posted beforehand. Patients would be able to “shop around” if they wish.
Choices based on “quality of life” would be left up to the patients. For example, if Grandma has $50,000 in her HSA and needs a pacemaker, it’s up to her whether to get it or give that money to her grand kids for their HSAs.
Prices will drop drastically. Competition drives prices down and improves quality. It also lets people prioritize what is important and helps prevent fraud and abuse. For example, a large percentage of ambulance calls are not emergencies. They are for people who don’t want to walk to the hospital or ask the neighbor for a ride. It’s for CONVENIENCE… and a very EXPENSIVE convenience that is!
You don’t need a $600-$1,000 full ambulance ride with a trained paramedic for the sniffles or a fever.
Maybe if the child has a fever or the sniffles, they will wait until the next day or call the neighbor or even call a cab. If YOU are paying for something, it is suddenly YOUR money, not “THEY” or “The Government.”
It also lets people judge for themselves what is effective or not. I’ve lost track of the number of people who say “Well I don’t think the treatment is doing anything for my back but… hey, I’m not paying for it so what the hell? Why not?”
That is waste right there. If it’s YOUR money, even money you got from the government, you have an incentive to hold onto it. It’s like sick days at work… you never know when you might need some!
I figure that if we eliminated Obamacare, Medicaid, Medicare and the VA with a shit ton of other regulations, it would save BILLIONS right off the top. For starters, if the Feds don’t do much besides open HSA accounts… that can be done by Health and Human Services. Heck, it can be done by the Treasury Department!
For every department you eliminate and join with another, that’s a huge staff you don’t need. If you don’t need a Medicaid, Medicare, Obamacare (HHS) and VA director each… that’s a six-figure paycheck each. Plus the deputies. The assistants to the deputies. The assistants to the assistants. The secretary to the assistant to the assistant deputy director… the assistant secretary to the assistant to the assistant deputy director…
You think I’m making these positions up? Look em up. They exist and they get paid BIG BUCKS! If you eliminate the need for these jobs, you eliminate all these hundreds of thousands of dollars a year bureaucrats AND their golden benefits packages worth just as much as their salary!
I figure conservatively that 20% of any given agency can be eliminated by simply merging it with another. Do the math. Even before the free market gets a chance to cut costs and improve service, you’ve already saved hundreds of billions of dollars of SIMPLE REDUNDANCY!
I estimate we could save about 1/3 of the Federal government paid medical costs in this country if we went to this simplified, streamlined system. About 30% of the Federal budget goes to medical costs, so that’d be about 10% of the total Federal Budget in savings.
Let’s see… 10% of 3.8 TRILLION dollars is about $380 billion. That’s BILLIONS with a “B.” As in 380,000 MILLIONS.
That’s nearly FOUR TIMES as much as we spend on education… saved simply through cutting waste, abuse and redundancy. Without cutting quality or quantity!
Having some actual competition will do more than that, at least another 20-50% if basically every other industry is any measure. But, I’m not even going there. I’m simply saying making it SIMPLE and EFFICIENT will save us billions.
Although while we’re talking about cutting redundancy….
we have a Dept of Education in every states.
We have a Dept of Transportation in every state.
We have a Dept of Health in every state.
We have a Dept of Agriculture in every state.
We have a Dept of Finance/Treasury/Taxation in every state.
We have a Dept of Veterans Affairs in every state.
We have a Dept of Environmental Conservation in every state.
Is there anything that is done in any of these FEDERAL departments that couldn’t be done at the state level? Is there anything that isn’t done WITHIN a state by these FEDERAL departments?
Technically the Feds are only supposed to regulate INTERSTATE trade… nothing within a state to within a state.
Why do my tax dollars go to Washington in order to go to Albany in order to go back to the school district 2 miles from my house? Seems like a great way to create useless bureaucratic, political jobs… but a really BAD way to run an efficient school system.
Suppose we cut those middle men (and women) out and spent all that saved money on our actual schools and teachers? Sound like a plan?
Seems like a common sense idea to me.
I don’t have a fancy name for that plan.
Them fancy political scientist professors call it “Consolidarity.”
ie “Government at the local practical level.”
I’d call it “Readneck Common Cents.”