James Pethokoukis
Politics and policy from inside Washington
China questions costs of U.S. healthcare reform
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Guess what? It turns out the Chinese are kind of curious about how President Barack Obama’s healthcare reform plans would impact America’s huge fiscal deficit. Government officials are using his Asian trip as an opportunity to ask the White House questions. Detailed questions.
Boilerplate assurances that America won’t default on its debt or inflate the shortfall away are apparently not cutting it. Nor should they, when one owns nearly $2 trillion in assets denominated in the currency of a country about to double its national debt over the next decade.
Nothing happening in Washington today should give Beijing any comfort or confidence about what may happen tomorrow. Healthcare reform was originally promoted as a way to “bend the curve” on escalating entitlement costs, the major part of which is financing Medicare and Medicaid. That is looking more and more like an overpromised deliverable.
For instance, a new study from the U.S. government’s Centers for Medicare and Medicaid Services finds that the healthcare reform bill recently passed in the House of Representatives would increase healthcare spending to 21.3 percent of GDP by 2019 compared with 20.8 percent under current law. That’s bending the curve the wrong way. The study also questions the “long-term viability” of the $500 billion in Medicare cuts meant to help pay for expanded insurance coverage.
In addition, the CMS study gives a clearer cost estimate than the one provided by the Congressional Budget Office. According to the CBO, the 10-year cost of PelosiCare is $894 billion. But that analysis includes early years with little government spending, According to the CMS, the House approach would cost $1 trillion from 2013-2019, or some $140 billion a year when fully put into effect.
Few realists in Washington think any of the current reform plans make a significant dent in the long-term healthcare cost to government. Indeed, the Senate Budget Committee recently held hearing about creating a bipartisan commission to find solutions to America’s entitlements problems.
If healthcare reform really bent the curve, there would be a no need for such a commission to do Healthcare Reform 2.0.
The Chinese might want to keep up the questioning.
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This is the question I would like to ask. Health next to family is probably the most important aspect of one’s life. Why in the world would we leave the of the most important aspects of our life in the hands of greedy corporations whose only concern is profits. To me that is unbelievable. There concern is not your health so why would we believe they’re going to do anything in our best interest. Ask the families of people who have died because the insurance companies refused or denied life saving treatment. If that’s not a death panel I don’t know what is. Of course they only want to insure healthy people and omit pre-existing conditions while continually raising premiums and will continue to do it because WE HAVE NO CHOICE.How long is going to take the idiotic American public to realize we must have changes and reform.
The government has never been the model of efficiency on anything. In fact, everything they touch eventually deteriorates because the people working for the government do not care about us. They just punch the clock and try to get by doing the least they can knowing they can not get fired. At least in private companies, people must perform or they get fired. Look at the DMVs, Social Security offices, post offices, etc. If we want lower rates, encourage competition by let us buy insurance across state lines like we can with car insurance. Tell the states to stop designing expensive medical insurance requirements that force up premiums and let individuals have the option of taking only catastrophic coverage. If an individual pays the first $2000 a year of medical costs before coverage kicks in, the cost of insurance will go down significantly. If people get policies with little or no co-pay, the medical system will be overwhelmed by people who would normally self-medicate and shake it off. If medical care is free, it will be used for every little issue.
this is in response to the posting by imgibson. Per your reasoning, why in the world would you let your family eat the food grown by farmers whose only concern is for profit? Why would you trust your family’s safety in a car manufactured by a profit motivated corporation(exempting GM and Chrysler, two government owned non-profit organizations.) Why do you live in a house built by greedy builders? The list goes on and on. One presumes that you work for “profit”. It is the profit motive that drives the free market and results in a higher standard of living for all.
NO system of health care can deliver the very best quality health care to everyone. There is always something more you could spend on.To sober up those who think the European statist system is perfect, I’d like to mention that I know TWO people here in Germany whom the state insurances have denied life-saving health treatments (standard officially recognized treatments) for cost reasons.
Unintended consequences!!!! We are told that the “greedy” insurance industry won’t collapse if placed in a market against teh taxpayer subsidized government option….but what if it does? Everyone knows people that work in teh insurance industry, what if that industry collapses and you have another million + unemployed + our 401ks that plummet as companies drop like flies? Congress doesn’t think about what they are doing, just whatever it takes to win teh next election. How about teh Flex Spending and Health Saving account industry that will no longer be tax free if the bill passes? Another ton of folks out of work.. Any doubt a greedy company like FedEX could run the USPS more efficiently and not cost the taxpayers billions every year in losse….This bill is not free…it will limit every aspect of our lives from what we can eat to what we drive…The poor saps that actually work & pay taxes are the biggest losers in this.
Now that America is inextricably indebted to China and have already given them our manufacturing base it’s no surprise that they wish to impose their values on us! What does surprise me is our government’s downright refusal to protect American interests where China is concerned. These guys still have missles pointed at us!!! Why did allegedly poorly educated working men tell our government 30 years ago what has happened would happen only to be rebuked by legislators and our corporate owners??? Representative government MY ASS!!!
Are the Chinese also racists for asking the same questions about ObamaCare that Tea Party protesters asked? Or are the people who are being asked to loan Obama the money to pay for this monstrosity finding common cause with the people who must, along with their children and grandchildren, eventually repay the loan?
HAHAHAHA, getting pushed around by the big Red Machine. Better go start a war with them to save face… they only outnumber America by one billion people.Well, it was a good run: 149 years without slavery. Back to the drawing board, America. And you know what else, it’s NOT Obama’s fault either!
“This is the question I would like to ask. Health next to family is probably the most important aspect of one’s life. Why in the world would we leave the of the most important aspects of our life in the hands of greedy corporations whose only concern is profits. To me that is unbelievable. There concern is not your health so why would we believe they’re going to do anything in our best interest”That’s funny. Who is a better ‘they’…politicians?(Where are these millions of altruistic doctors and healthcare workers and medical researchers who will take better care of us without reward for their crazy workload?)
@ imgibsonBecause greedy corporations are the least worst alternative when you consider an incompetent government or paying cash or not getting care are the only other choices?My son is alive today because I use a greedy corp for insurance. If we had been in Canada, he most likely wouldn’t have recieved chemo in time.That’s enough for me.
Does anyone know…Did the idiot bow to the Chinese dictator too? Any chance we can all get into a time machine and fast forward to 2012?Oh Yeah, Obama 4 the Heisman!!!!
What makes you think that health care is a right????
LMGIBSON-According to the 2008 National Insurer Report Card, Medicare (a non-profit, government run health insurance program) denies nearly 7% of all claims filed. Private Insurers, those greedy corporations, deny less than 4%. And one major difference between a private and public insurance program- when your claim is denied by a private insurer you have a legal recourse in the court system, and, if you win, can get punitive damages. If denied by a government program, your only recourse is in that administration’s own administrative appeals process, which is often heavily stacked against you.Private Insurers are driven, at least in large part, by profits. But that doesn’t necessarily equal a bad thing. When controlling costs is a goal, they can focus on lowering administrative costs and streamlining operations. Things that a public plan, with the full backing of the U.S. Federal government, would have no real incentive to do. Look at every federal entitlement program out there- they all cost more every year than they were ever envisioned to cost. How would Pelosi or Obama Care be any different? The U.S. Post Office lost more than 3 Billion Dollars last year, and all they do is deliver mail. Imagine that sort of organization running the most important aspect of our lives- our health.
There are several actions that could be taken that do not involve the federal government spending money or taking control over health care and our personal lives. But these are free market solutions and the Marxist in Chief won’t hear of it. Start with tort reform and public pricing of health care services. See what happens. Meanwhile, impeach Obama, Reid and Pelosi for their numerous violations of the Constitutiton.Ironic how quickly the Chi Coms have caught on to capitalism and how far it has brought them in such a short time.
I’m a small business owner. Reform is needed but in simple form, not the convoluted bill the house passed. Treat health insurnace like car insurance and let the consumer shop around. I don’t provide car insurance to my employees, why do I have to provide health insurance. Allow consumers to shop for Health Care across state lines with real competition. If that doesn’t work, then take more draconian measures, but try common sense first. Or is the health care bill really not about health care after all?
dear imgibson,the insurance companies are private enterprises in search of making a profit for themselves and their stockholders. That is absolutely true and representative of the American capitalist model. They have been hamstrung over the years by increasing regulatory oversight to the point where whole departments exist within each company to follow and comply regulations at the federal, state, and even local levels. If you for a second think that the government has your best interest at heart you are either very young, very naive, or both. Government is only interested in amassing more power and the beauty of the setup for them is that they don’t have to put any of their own money in the game to win it. They take your money, given to them by the coercive force of taxation, and distribute it as they see fit to ensconce themselves in positions of more and more power. I don’t know where you get the idea that a government bureaucracy with no inherent risk is going to be more responsible than a company trying to turn a profit. What is government’s motivation? What happens if their service is bad? What happens if you complain? Can you sue them? Can you vote the program out? Can you pick a different provider?
Part of the Obama sales pitch on healthcare was the USA pays more of GDP for healthcare then other nations.His plan INCREASES percent of GDP and does not decrease it. Secondly we were told we PAY too much for healthcare as a nation. So how is adding another Trillion Dollars help?
A figurative slap upside the head is probably in order. The Chinese should invite over some of the key House and Senate members and explain to them if they vote for Obamacare, China will sell a large quantity of its US holdings.
I like Not_American’s comments and though I believe Obama is a catastrophe he cannot be blamed for this particular mess. But his party certainly can and so can the Republican bafoons who have been in office for years(i.e. John McCain) and done nothing but advance their own portfolios and resumes while we have no energy policy, no medical plan, no answer to the trillions of dollars of unfunded liabilites in social security and medicare, just to name a few of the disasters that await this country. It has been a good run but it is over. Unless you are ready to fight WW3 the gig is up. Checkmate!!
@imgibson: you should have the most say on your health. Also, read an economics book.
According to an article on TheHill.com, Medicare denies more claims than commercial insurers.“Medicare was the most likely to deny any part of a claim, with a 6.9 percent rate. Aetna was a close second at 6.8 percent while the others ranged from 2.7 percent to 4.6 percent.
I cannot understand how some folks continue to blast away at insurance companies and our present health system’s shortcomings as a way to say we can do better by turning it all over to a socialized government defict-run system! If it is not as good as we need now why make it worse? Pelosi’s House Bill will ruin this nation and the Chinese know it, as well as anyone who sees the numbers! It does nothing to increase competition among insurers by state, nothing to reform tort law. Legislate to elimintae the abuse by insurers and do these other things that actually save money and improve care. I am so fed up with the ignorance and lies. Stay out of my pocket already!
Insurance co.s only have about a 2-3 % profit margin. And yes, profit is what drives the nation. If you want to rant and rave about something, direct it towards our screwed up Congress and House of Reps. The gov is the main problem with our America. Too many regulations, too many greedy politicians, too many lobbyists, too many that think someone OWES them something. Get off your lazy rears and work, contribute to society rather than sponge off of it. We don’t owe anything to anyone except the rights outlined in the Constitution.
Its amazing – I guess the Obama, the House, and their followers have figured out the secret to the “Free Lunch”…Oh wait – that does not exist. I wonder if the Attorney General will spring into action to examine this ‘scheme’? Maybe Bernie Madoff will have some company soon.
I thought Obama was going to pay my rent and my gas bill. He has not done that yet. We true Americans deserve free medical. We need the President to move forward on Healtcare for America. God Bless us all!
QUESTION?????????????What has the US government predicted right?Common sense says that insureing more people especialy those who have no money will raise everybodies costs and cause huge waiting lists for care since we are not increaseing the number of doctors. . Entrusting 20% of the US economy to the US government to run anything to the government is a mistake and China should be worried. .
All you “Liberal” scum…die!
I have a friend who has been waiting in Portugal for 4 years for an operation – her doctor has told her she should go to the USA to get the operation because she still has to wait another 2 years and he thinks she might be dead by then. State health is so good? If it wasn’t for our terrible system she will die. Our’s may not be perfect but its still the best in the world. I don’t know anyone who wants to go to Portugal for an operation, its always the other way arround. I don’t want european style health care. It’s too much like no care at all. Hope this health care bill dies a good death in the Senate.
Mr PrezAre you smarter than a Chinaman?
If you have private insurance, you still have some recourse with the government ro remedy an injustice via regulatory agencies and/or the courts. If the government provides health care, you have less recourse and less competition.Quo warranto, B.O.?Psalm 109:8
To the very first comment…..”imgibson”This is where you pinheads get it all worng. It is YOU that is responsible for your health and your health care. Not ‘big, bad, mean corporations’ and not the government – which the last time I checked supposed to mean me and the other millions of Americans that don’t live at your house. And I AM NOT RESPONSIBLE FOR YOUR HEALTH CARE. Take care of yourself blowhard.
How ironic if the Chicoms ultimately spare us from the ruination of our free market health care system by our irresponsible, free spending increasingly socialistic government! The politicians in Washington, if they are successful in passing the current proposed measures, should be held accountable by more than just the loss of their government jobs. They are quick to prosecute corporate leaders for malfeasance, and yet they violate their fiduciary responsibilities and ignore the oath they took to uphold the Constitution. Apparently not one of them can cite Constitutional authority to force government mandated health care on us. Most Americans do not want this forced health care. It sickens me to hear Nancy Pelosi speak about Congress’s “gift” by Christmas to the American people – a “gift” you and your future generations have to pay for, a gift you cannot refuse, and if you do, you will be fined and imprisoned. No thank you Nancy!
imgibsonIf you really believe that all will be well and everyone will receive all the medical treatments that they need no matter what the cost if only the government were in charge of health care, then there really is no polite way to tell you how very stupid you are. You’re probably a decent person who just wants everyone to play nice and share and provide for each other and you wonder why can’t the world just be rosy and wonderful……thats a nice pipe dream, it doesn’t work in the real world and there are lots of other countries who have tried it and it has failed.
2 out of every 5 workers in the United States pay NO federal income taxes. How long can the other 3 carry everyone ???
I love the last comments talking about leaving healthcare in the hands of “greedy corporations”. The health insurance companies in American have an average profit margin of 2-3%. That means their profit is 2-3 cents for every dollar – hardly, runaway “greedy” profits yet the insurance companies have been demonized.Pelosicare must die in the Senate and the voters MUST balance the power in the 2010 midterm elections. Democrat or Republican, neither party can seem to handle having absolute control. I feel that the 2010 election is the absolute last chance we have to keep America great. If voters do not elect some Republicans/Independents to balance the power in Washington, we will slip into European Socialism with enormous taxes, high government debt and unheard of government control over the people of the United States.
To imgibson. Your comment: “Ask the families of people who have died because the insurance companies refused or denied life saving treatment.” First please give some concrete examples. Second, Insurance companies cannot deny you treatment – they just can refuse to pay for it, if it contravenes the policy (rare). Hospitals BY LAW must treat any and all patients regardless of their ability to pay or their insurance coverage.
Imagine that! Our largest shareholder, for lack of better description, is questioning the moves of the board as they try to spend more than they have. Ha, ha, I love it! Get BO out! He stinks! Isn’t that what BO is? Get rid of PC, quotas, redistribution, reparations, etc. Y’ALL got your freedom! Now go to work!!!!
Somewhere over the Pacific Ocean, a teleprompter if racing its way to China to answer that question.
Private insurers are making profit, but not outrageous profits. If anyone is thinking private insurers are making outrageous profits, they’re wrong. Just look at their stock prices and imcome statements. Private insurers deserve the reasonable profits they are earning because they are efficient at managing the health care cost. If you compare their profits with government waste and fraud in Medicare and Medicaid or any other government programs, it’s no brainer that health care management must be left in private hands. Private sector exists because it’s supposed to solve the problem of government waste. Just look at China. The Chinese have to privatize many industries because of scarry government waste and inefficiency.In the current system, poor people do have worse health care than the rich. But that’s a necessity. If one by right can have the same health care as the rich, why should I study hard while in school and work hard while in a job ? Socialism fails because the lazy have the same privileges as the hard-working. So no one is willing to work hard, and the whole system failed, which is exactly the case in the old Soviet Union and Communist China.
Why would we leave are health care in the hands of the government which has never implemented a major spending bill or program without being fiscally irresponsible. Want to ignore government health care as it is now? Medicaid/Medicare reimbursements are ratcheted down so far- that is the cost saving strategy- that doctors cannot keep offices open with that level of pay out. They are refusing to participate in the plans so there is dramatically diminished access to care for populations who need it most. The plans drive out quality care and are not financially sound. These programs have had a negative impact on medical education by underfunding care for the poor and those without insurance at teaching med centers, leaving them financially compromised and limiting good medical education. Then there are the examples of the VA and Bureau of Indian Affairs health systems which are appallingly bad. So the issue is modifying what we have, not letting the government in the door to manage the largest single sector of our economy or take over care directly. Dems want to socialized every sector of the economy or overregulate it to meet their own political ends and create dependent constituencies. Obamacare will be no care at all within a relatively short time.
Why do liberals trust government so much??Name one government program that has even approached doing what the liberal hope this one will do?The Answer is NONE.
Given how Obama and the Chicago way is performing, no, Obama is not smarter than a “Chinaman.” He just thinks he is Allah’s gift to the world.
As I read through some of these posts it becomes clear that this “health care” is not an issue of common sense but rather one of emotion.Here is an “out of context” quote. “How long is going to take the idiotic American public to realize we must have changes and reform.” The words “changes and reform” are, in themselves meaningless. However the public has bought into them, never asking what they mean. There is seldom any specificity from politicians, only broad stoked nice sounding cliches, bough by an uninformed public. It reminds me of the little boy on his first day in school. The teacher said “now we going to learn arithmetic” One and One is two, to which the little bit answered yeah, one and one is two………What’s a two?And so it is with “change and reform” change and reform to what? Obama says we will save money on Medicare, why couldn’t we have saved money on medicare years ago because it’s a crock, that’s why. If you extend health care to a few million people the cost is equal to the number you ensure. How does that save money? You are being treated to Governmental slight of hand and you are buying into the lie. It’s not about health care, it’s about Government control and power……….WAKE UP!
Anyone that believes that government can run health-care need only look at social security and Medicare, and if they then cannot see the writing on the wall, which is as clear as daylight, then they are utter abject morons that believe in the tooth fairy, and arguing with a moron is pointless…Government run health care is one thing, and one thing only: it is one group of people’s strategy for wresting the profits and power away from the group of people who are making the profits now, and it is no more than that.Government health care will be 10-times worse than you fools that want it, can imagine, and you are morons for falling for the fraud, petty for believing you have some right to what other people have earned for themselves, and utter imbeciles for believing any socialist will give you anything but excuses while they blame someone else for their shortfall.
my husband is an anesthesiologist. He gets $15 for a labor epidural from medicare. That doesnt cover the costs of the needle the gloves and his medical liability. Doctors will refuse to work if they personally lose money FOR THEIR OWN FAMILY! everytime he sees a govt health insured patient
Those who see profit as greed, may I remind you that in government profit is called a surplus. Since most on the left see profit and surpluses as greed what do you call deficit spending? Righteous? Responsible? Greedy? Deficit spending usually is a sign of operational inefficiencies and outright waste and since government has no competiton, it has no incentive to achieve efficiencies and eliminate waste that result in a surplus because deficit spending is paid out of your pay check the same way health care premiums are. What do you call Medicare and Medicaid programs that underpay providers with the expectation that mandated government discounts will increase private insurer premiums 11-25 percent a portion of which is paid by you? Greedy? Sneaky? Corrupt? Are government deficits which are seldom challenged really more righteous than corporate profits which are always challenged? Could the costs of government inefficiencies and waste be greater than corporate profits? Would a health care system under corrupt and greedy health insurers constantly challenged be cheaper than a under the whims of a corrupt and greedy Congress and entrenched bureaucracy that is seldom challenged?
They will probably ask about the success rate of combating obesity, the fast food culture and all other related health issues. I just hope that they dont bring out the human rights and gender equality issues.
Hmm. Everyone has a right and responsibility to your own health – but why should the Chinese pay for it? We already owe them $2 trillion. And I’m guessing that the price of gold is going up because countries like China are dumping dollars and buying gold bullion instead as they suspect that we in America are unable to balance our budget without piling on debt and printing money until we run out of trees – which, let’s face it, is exactly what’s going on. We’re in a lot of trouble. And as great as it is that our leaders like Obama want to give us more socialized healthcare – the bottom line is that we can’t afford it right now. Obama wants to make it his presidential legacy. I think he should be more concerned about being a more fiscally responsible leader. Of course that will never happen because all our leaders want is to be re-elected. They don’t care about the people. They just care about power and their pals on Wall St. Both Dems and Republicans are the same. Two heads on the same snake. It’s time for a REAL change. Next time vote a libertarian (you know, LIBERTY – remember that one??) candidate like Ron Paul. He’ll turn this ship around…
Oh how we forget, it’s only the other guy who’s greedy.
If they really wanted to fix healthcare, then they would address the problems that it has. Nowhere in the House Bill does it try to do this. In fact, it makes allot of the problems even worse. Tort Reform is a proven method to lower costs. It’s worked in every state that has it. In this bill, it does the opposite by allowing more lawsuites. This only helps the lawyers. Giving treatment to illegal and even tourists is costing the hosbpitals millions of dollars. If a person shows up at the Emergancy Room and is dying, the hospital has to take care of them. That’s fine, but if a person who lives in another country comes here, goes to the emergancy room, that person also gets treatment. They are doing it every day just to get free treatment. When the hospital has to treat people for free, the ones who pay have to make up the difference. That drives up the cost for all of us. Insurance companies are not allowed to cross state lines. Let them offer plans all over the country and allow us to chose the best one. The solutions are pretty well known, but nowhere in the bill are they trying to fix the problem. It’s a big scam and as a result, it will only get worse. It can’t get better if you don’t fix the problems.