nos-trum. pronunciation: \nos'-trum\. noun. Etymology: Latin, neuter of noster our, ours.
1. a medicine of secret composition recommended by its preparer but usually without scientific proof of its effectiveness.
2. a usually questionable remedy or scheme.
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Saturday, March 27, 2010

Health Care Reform - Poison Pill Of The Day

 
Poison Pill #5  - Beginning a new series

I may be off on the number, but I'm starting to track them. 

Don't get me wrong, there are great results in the health care reform law:  no caps, portability, pre-existing illness coverage, and the like.  Unfortunately, there's another 2500 pages of stuff.

Since nobody read the bill, we're learning of defects every day.  Will they get fixed? 

So, rather than continuing to extoll the good aspects, about which there's nothing more to say, I'll concentrate on the problems created by writing a huge law, drafted by Congressional staff who are mostly poli sci majors or long-term politico's (with no deep understanding of the system), under circumstances of haste, special deals, etc.

This is the Poison Pill list so far.  We have (1) Congressional staff exempt from mandate, (2) failure to implement coverage for kids with pre-existing illness, (3) taxpayer bonus to hospitals that are less costly, (4) billions in charges to businesses (Caterpillar, John Deere) from loss of tax deduction for retiree drug benefits--reducing economic growth and new jobs.

#5:  3500 companies who offer retiree drug benefit may be forced to dump their retirees on Medicare.

This is related to Pill #4, but the impact is on the patient, not the company.  The loss of tax deduction for the companies of the over 4 million people covered by employer-supported retiree drug benefits will lead to those companies adopting higher co-pays, deductibles, and caps...in order to make up for their tax losses.  In some or all cases the companies may decide that it's cheaper to cancel the coverage and dump the retirees onto the Medicare system.  So much for keeping your health plans, and lowering premiums.

Taxpayers may now pay $1200 instead of $600 for each person receiving drug coverage.

Here's the kicker for us all.  On average, before health care reform, the companies received a $600 tax deduction for providing this coverage.  The companies paid the rest.  With Medicare, the average annual taxpayer bill for covering the benefit is $1200.  We traded a $600 tax revenue loss, for a $1200 taxpayer payment.  Such a deal.  How does anybody benefit from this--except the government; who receives the revenue from the companies-and can spend it as they wish? (I understand that the Rock and Roll Museum may get only $3M in earmarks this year; maybe we can bump them up a few million).

Stay tuned for the next Poison Pill.

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