Coyote Blog

I may just be showing how ignorant I am on the subject, but my sense has always been that state nullification of federal laws is a tool not much tried or used since the first half of the 19th century.  While a number of our Founders, particularly Jefferson, saw state nullification (not the Supreme Court) as the key check on arbitrary or unconstitutional Federal legislation, the whole subject sort of gained a taint, along with states rights, by its association with the South's defense of slavery.

Anyway, state opposition to the Real ID law has been an pretty interesting and frankly, for this libertarian, exciting re-invigoration of this potential check on Federal power.  We have also seen efforts in states like California and Colorado to effectively nullify certain Federal drug laws.  Now Arizona, among other states, is seeking to nullify bits of the proposed Federal health care legislation:

Right on the heels of a successful state-by-state nullification of the 2005 Real ID act, the State of Arizona is out in the forefront of a growing resistance to proposed federal health care legislation.

This past Monday, the Arizona State Senate voted 18-11 to concur with the House and approve the Health Care Freedom Act (HCR2014).  This will put a proposal on the 2010 ballot which would constitutionally override any law, rule or regulation that requires individuals or employers to participate in any particular health care system.

HCR2014, if approved by voters next year, also would prohibit any fine or penalty on anyone or any company for deciding to purchase health care directly. Doctors and health care providers would remain free to accept those funds and provide those services.

Finally, it would overrule anything that prohibits the sale of private health insurance in Arizona.

Five other states "” Indiana, Minnesota, New Mexico, North Dakota and Wyoming "” are considering similar initiatives for their 2010 ballots.

I have zero idea if this is legal or possible, but I am all for trying.   And I say this knowing that as an employer, the legal mess it may create for me could be awful.  I could easily see a situation where it is required under Federal law that we enroll employees but illegal to do so under state law.  I can easily see a situation developing similar to what medical marijuana growers face in California, pulled back and forth between state and federal law.

Supporters of government medicine often quote a statistic that shows life expectancy in the US lower than most European nations with government-run health systems.  But what they never mention is that this ranking is mainly due to lifestyle and social factors that have nothing to do with health care.  Removing just two factors - death from accidents (mainly car crashes) and murders - vaults the US to the top of the list.  Here, via Carpe Diem, are the raw and corrected numbers:

The Mark Perry post linked above has links in turn to the study itself and its methodology.  You may have seen stats that say that, using raw data, the US has the best life expectancy once you reach age 65.  This is just another way of correcting out higher accident and murder rates, as these tend to affect younger folks.

My guess is that if one corrected for other lifestyle issues and environmental factors that increase the incidence rates of things like heart disease in the US (discussion here), then the US lead would be even more stark.  If one takes the left at its word that the US starts in a health care "hole" with poor diet, obesity, environmental problems, etc., then the US medical care system, despite starting in a hole, is able to still raise US life expectancies above other countries.

One big reason is cancer survival rates, which dwarf those in Europe.  It is at such leading and expensive edges of medicine where one might expect the US system to get much better results, and it does.

But it is often said that this is only for the rich -- that the poor in the US don't benefit.  Well, this is a difficult proposition to test, as income mobility (which is very real in this country no matter how much the left denies it) makes correlation of income (say by quartile) and life expectancy impossible.  During a person's lifetime, they might inhabit several different quartiles.

A proxy I think the left might accept is one  of race.  If one assumes that African-Americans are among the systematically disenfranchised in the health care system, then it should show up in their stats.  The results are something that gives ammunition to both sides of the debate.

Clearly, there are two tiers, as African Americans have poorer cancer survival rates than white Americans.  But, for many types of cancer, African-Americans have higher survival rates than they would in many European countries.

This is the endless do-loop of inequality debates.  Is inequality OK if it results the folks lower on the totem pole being better off than in a more egalitarian society.  For me, the answer seems obvious.  Absolute well-being seems far more meaningful than relative well-being.  But I am not necessarily in the strong majority on this.  I had a professor that used to poll his class -- he would ask them if they would prefer a society where the gap between rich and poor was narrower but where the poor were, on an absolute basis, worse off than in the less equal society.  He reported the vote almost always split about 50/50.  (of course the is a purely utilitarian formulation of the question.  Adding in individual liberties issues makes the question far more stark, as to achieve an egalitarian society one must give up both wealth and liberty.)

I don't tend to shop at Whole Foods because they offer a value proposition that does not appeal to me.  Their prices are too high for products that generally don't seem noticeably better than ones I can get in other stores.  To some extent the placebo effect of having "all natural" on the package does not really work for me, though I do buy most of my fish and meat there  (and not just because I like the irony of buying only meat products from a store populated by vegans).

That said, I like having the choice in stores.  I even drop by a farmers market once in a while, though generally the hassle is not worth it for me.  The same is true in beers -- I am seldom in the mood for something as dark and rich as a Belhaven, I love the explosion of choices in beer we have seen since the dark days of the late 70's/early 80's.  Other people will make different choices.  Cool.

Which makes it all the more ironic that those who benefit from the explosion in retail choice in the free marketplace are using that choice to protest the CEO of Whole Foods for advocating similar levels of choice in health care.  Anyway, I would write more but Radley Balko did a much better job here.

You see, he shared his ideas on health care reform, thinking that you, being so famously open-minded and all, might take to a few of them, or that it at least might start a conversation. I guess he felt he'd built up some cache with you, and wanted to introduce you to some new ideas. His mistake wasn't in intentionally offending his customers. He's a businessman who has built a huge company up from the ground. I'm sure he knows you don't deliberately offend your customers. His mistake was assuming you all were open-minded enough consider these ideas without taking offense"”that you wouldn't throw a tantrum merely because he suggested some reforms that didn't fall in direct line with those endorsed by your exalted Democratic leaders in Washington. In retrospect? Yeah, it was a bad move. Turns out that many of you weren't nearly mature enough to handle it.

Its hard even to understate the how absolutely nuts self-styled "progressives" have gone over this pretty tame and sober editorial in the IBD.  Here is just one example -- this is a mainstream green blogger and not some weird comment to a Kos post.  I honestly thought this was satire at first:

I agree with CEO John Mackey that it's okay to make money by making your green business big. But Mackey crossed the line with an op-ed in the Wall Street Journal this weekend, whose very publication put him in the company of the lunatic right-wing fringe who edit the paper's opinion section.

The op-ed reads like a page from the Republican playbook, touting individual responsibility for one's health. What a load of unorganic crap!

Holy brothers-keeper Batman - He's advocating individual responsibility!!  Here, since I have not reproduced it before, are the "lunatic" ideas of Mr. Mackey:

"¢"‰Remove the legal obstacles that slow the creation of high-deductible health insurance plans and health savings accounts (HSAs).

"¢"‰Equalize the tax laws so that employer-provided health insurance and individually owned health insurance have the same tax benefits.

"¢"‰Repeal all state laws which prevent insurance companies from competing across state lines.

"¢"‰Repeal government mandates regarding what insurance companies must cover.

"¢"‰Enact tort reform to end the ruinous lawsuits that force doctors to pay insurance costs of hundreds of thousands of dollars per year.

"¢"‰Make costs transparent so that consumers understand what health-care treatments cost.

"¢"‰Enact Medicare reform.

"¢"‰Finally, revise tax forms to make it easier for individuals to make a voluntary, tax-deductible donation to help the millions of people who have no insurance and aren't covered by Medicare, Medicaid or the State Children's Health Insurance Program.

The tort reform area is one where Obama is particularly disingenuous. It is just amazing that anyone could write about the cost of medicine being driven by too many useless procedures without once mentioning the words malpractice or defensive medicine.  I wonder if this might explain Obama's silence on tort reform (via maggies farm)

I am confused as to why a preference for overpriced organic foods and a preference for government monopoly control of health care are necessarily correlated at the 1.0 level.  But apparently they are.  Maybe its a common desire to overpay for basic necessities?

If you want to really confuse someone, restate the minimum wage laws this way:

It is generally illegal in the US to accept a job for less than $7.25 an hour.  The minimum wage laws are therefore a substantial constraint on individual liberties

When I say this to most folks, they get confused because laws like minimum wages are usually stated in terms of empowerment of the common man.  The theory is that individuals don't have enough bargaining power to really get what the true clearing price should be for their labor, so the government steps in to prevent evil corporations (ie "the man") from exploiting this power imbalance and paying wages that are too low.

Tell that to my 15-year-old son who is looking for a job.  Sure, he would like to earn some good cash, but the wage scale of a job is way down the list of priorities.  What he really needs is a chance to build basic work skills and knowledge of how organizations function that you and I take for granted.  Further, he would like to get some direct experience with customer contact.  And finally, he wants to demonstrate to future college choices that he can function successfully in a work environment, and that he is motivated enough to keep and hold a job.

As a result, my son would likely gladly take the right job for, say, $3 an hour.  And an employer might jump at this deal, understanding the lower wage helps compensate for the costs of dealing with an inexperienced new employee and the risk of hiring a teenaged boy with distracting amounts of hormones running through his system.  This would be a perfectly rational, consensual, everybody-wins arrangement that is absolutely illegal.  So don't tell me or my family that minimum wage laws are empowering.

The health care analog

Many very similar liberty-reducing regulations exist in the health care world, and more appear to be on the way.  One great example that is entirely similar to the minimum wage issue is minimum coverage rules.  Many states have lengthy lists of conditions that must be covered in any health insurance plan sold in that state.  From acupuncture to mental health to massages to homeopathic treatments, you can find just about every care specialty with a lobbying organization getting its services embodied in state laws as minimum requirements.

Again, supporters of such laws argue that this is empowering for consumers.  Every health care plan you can buy will have a wide array of covered services.  But, they will also all be expensive.  What if I don't want mental health coverage or acupuncture?  Why do I have to pay extra for this stuff to be covered by my policy?  I go to the doctor very, very infrequently - basically only if the condition is critical - so why is it illegal to purchase a health insurance plan that matches my health care use preferences?

Currently I pay for my own health care plan and have insurance that I consider true insurance.  It has a high deductible, and does not cover a bunch of non-critical stuff.  I have no dental coverage, and pay dental all out of pocket, as I do most routine medical expenses   I have medical insurance solely to cover catastrophic medical events that would likely be financially disastrous for me  (I do the same thing with my house and car, paying for routine maintenance with insurance reserved for catastrophes).   Fortunately, Arizona allows me to buy such a policy, though it does have minimum coverage rules that make the policy more expensive than it might be.  In other states, like Massachusetts, my health plan with a high deductible is illegal.  It would also be illegal under the current House and Senate versions of Obamacare.

Medical Insurance and Windshields

I do a lot of back road and highway driving, so windshield repair and replacement are things I deal with fairly frequently.  I've generally always just paid for these repairs out of pocket.   It is a field where if one shops around, there are a lot of good deals.  However, for a while I lived in a state that had a law that said all auto insurance must have windshield replacement coverage.

The effect on my behavior was dramatic.  When living there, I didn't even think about shopping around for a windshield repair.  I just had the dealer do it (surely the high cost supplier) when I had the car in for regular service.  I didn't care what the cost was, it was covered in my policy.  (Ironically, it turns out in retrospect that I should have shopped around -- because no one else in the sate cared about cost, all the windshield suppliers jacked up their prices and then competed by offering kickbacks in various forms to consumers, basically competing on how much of the insurance money they would share with the car owner.  Truly dysfunctional).

I have seen the exact same change in my behavior, but in reverse, in switching to a high deductible medical policy.  Until about 3 years ago, like most Americans, we never even thought about the cost of our medical care.  We weren't paying for it.  But now, as I pay most of our routine expenses, I am amazed at the difference.  When my son needed a CT scan, three phone calls gave us a huge variation in quoted prices.  It turns out, shopping works, even in medical care.

Postscript: I have always wondered why insurance companies didn't create some incentive for shopping.  If I were running such a company, I would be tempted to tell customers - "our reimbursement rate for CT scans in your area is X.  If you get it done for less than X, we will split the savings with you 50/50."  Though I suppose the danger is tht this could morph into a variation of the windshield kickback system.

I have written before about the  demagoguing going on about "health insurance profits" and just how BS those charges are.  Here is Obama yet again:

"There have been reports just over the last couple of days of insurance companies making record profits, right now," Obama said during a prime-time news conference. "At a time when everybody's getting hammered, they're making record profits, and premiums are going up. What's the constraint on that? ... Well, part of the way is to make sure that there's some competition out there."

This follows Pelosi saying:

I'm very pleased that our Chair of our Democratic Congressional Campaign Committee and member of the leadership will be talking too about the immoral profits being made by the insurance industry and how those profits have increased in the Bush years. We all believe in the profit motive; we all want to reward success.  But having that success come at the expense of America's working families "” have that success come by withholding care, when a person becomes ill, is just not right and we're going to take this issue in a new direction.

And pundits saying even crazier stuff, including Kevin Drum (who is actually one of the saner members of the left) writing:

It means the health insurance industry is scared that we might actually do something in 2009 and they want to be seen as something other than completely obstructionist. That means only one thing: they've shown fear, and now it's time to bore in for the kill and gut them like trouts. Let's get to it.

Rick Perry links to several posts debunking this claim, and shows a profit margin consistent with what I have found in my research -- about 3.3% of revenues, which my posts (linked above) showed has fallen over the last several years.  This profitability level ranks 86th(!) on the list of American industries, behind such rapacious industries as auto parts wholesalers and confectioners (see table in his post).  Look out everyone, if this industry is too profitable for this administration, then just about every industry in the country is too profitable.  Heck, this margin is even worse than mine, and I operate in an industry universally described as having "thin margins."

What do you call a man who thinks a 3.3% profit margin is too high?  How about "Marxist."

Update: My guess is that there is some health insurer who due to a merger grew larger and therefore made a higher profit in absolute dollar terms, so my guess is that Obama is not flat out lying.  But he is freaking close, given that he credits such profits to fee increases and denying services rather than business growth.  Profitability should be judged on margins, not total dollars (even better, it really should be judged on return on equity or return on assets employed, but that is rocket science to the economic monkeys wielding bone tools we have in the media).

To some extent, there are signs Obama may be willing to walk back health care "reform" to just insurance "reform," though the two are highly related.  As a minimum, insurance "reform" is likely to include rules that no one can be denied coverage, community rating, and minimum covered service requirements.

These are really, really expensive.  Megan McArdle on the NY experience:

John Cole takes me to task for not knowing that health insurance premia have tripled in New York State.  Indeed, he's right--I should have checked.

But this is not the "gotcha" the left believes.  I erred so low because I was trying to be charitable to the cause of national health care.  You see, the reason that insurance premia are so high in New York State is that New York State enjoys community rating, guaranteed issue, and a very generous bevy of mandatory services.  The result is that the cost of insurance is very, very high.  What I failed to realize was just how radically out of line New York's rules had pushed its health care costs.  The average premium across the United States has increased about 25% since 2004.  In New York, the rate of inflation has apparently been about 16 times that.  I wasn't "aware" that insurance premiums have doubled and tripled over the last seven years, because for the country as a whole, this isn't true.

McArdle is sometimes irritating in bending over backwards to be fair to folks whose views don't deserve such charity and who would not ever extend the same favor back at her.  So it is kind of fun to see her going a bit postal over the last few days.

Here are some notes on the health care bill from one person who plowed all the way through it.  Some of the interpretations are a bit over the top, but I find it a useful index to help me find relevent sections I want to read in more detail.

Several people have emailed me this: Apparently the White House web site is asking that you report anyone writing things on health care that don't match the Administration position so the White House can "keep track".

There is a lot of disinformation about health insurance reform out there, spanning from control of personal finances to end of life care. These rumors often travel just below the surface via chain emails or through casual conversation. Since we can't keep track of all of them here at the White House, we're asking for your help. If you get an email or see something on the web about health insurance reform that seems fishy, send it to flag@whitehouse.gov.

Wow, "disinformation."  You wonder why people ever listen to those counter-revolutionaries and aren't satisfied with just reading Pravda.

Well, we at the global headquarters of CoyoteBlog Enterprises are certainly happy to help.  I sent them this email today:

Thanks for the opportunity to report disinformation where people write things that don't match what the President is saying on health care.  Please check out this document I found on the web -- a number of parts bear very little relationship, and in fact outright contradict, what the President is promising about health care reform.

The link is to a copy of the House health care reform bill.  If you are so inclined, you might wish to offer similar help.

Postscript: My son, who is a big fan of dystopic novels like George Orwell's "1984" might ask if he would get extra credit for turning in a family member.

Update #1: The White House site in question is really ridiculous.  It responds to critiques of what is actually in the bill with statements like "the President has consistently said that if you like your insurance plan, your doctor, or both, you will be able to keep them."  Well duh, of course he has.  But this President, even more than the average President, will say just about anything.

At this point, since the President is purposely uninvolved in the crafting of the legislation and has admitted at times that he doesn't even know the details of what is in it, talking about his promises or preferences is irrelevant.   In fact, nobody is talking about the President's promises and intentions any more, with actual legislation on the table.   They are talking about what is actually in the written bills in the House and Senate.

So the question is, what is in the actual legislation, and does it match Obama's promises, and the current answer is clearly "no."  And will the President veto a health care bill that doesn't follow through on his promises?  Don't make me laugh.  He is going to sign any bill with "health care" in the title no matter what it says -- his advisers have already made that clear by saying that the entire Presidency is riding on having some kind of bill pass that does something with health care.

By the way, in this we can see the White House strategy for passing such controversial bills.  Their hope is to jump directly from the President's "everyone is a winner and there is no cost" rhetoric directly to signed legislation.  They want people focused on his promises, which are enticing, and not the reality of the actual language of the bills, which is ugly and in many ways bear no relationship to the President's rhetoric.  This worked for the stimulus and almost worked for Waxman-Markey and was tried again for health care.

A number of folks, including myself but more prominently Megan McArdle, have argued that a big problem with nationalized health care schemes is that these plans threaten drug innovation in the US  (which is really the last remaining source of drug innovation in the whole world).

The argument is that nationalization schemes will likely hammer drug prices through price controls down to marginal cost, eliminating any profit motive for expensive drug development.  Further, new drugs will be hampered by having to convince government health care czars that the drug should be allowed under proposed proscriptive, top-down systems of allowed medical procedures.  Risk-adverse beauracrats faced with inevitable budget overruns are unlikely to take the chances with new procedures that the private world takes every day.  (And if you don't believe that budgets will be immediately overrun, look at cash-for clunkers, where 5 months of funds were used up in 5 days -- people may not like the government, but they will take free money and services in near infinite amounts).

Well, I had thought that the response to this argument from health care "reform" supporters would have been something like "private incentives to develop drugs will still exist because of X or Y."   But apparently, they have given up on that argument and jumped all the way to the argument that even without any private drug companies, Dr. Robert Stadler and the State Science Institute will do all the drug development we need.

Megan McArdle responds in depth here.  I think there is a simpler argument.  Look at something like computers or machine tools.  Innovation in these free markets occurs all over the world, and new inventions and products are as likely to come from Korea or Japan or Germany than from the US.  But in the world of pharmaceuticals and new medical devices, a wildly disproportionate share come in the US, the last semi-free health care market in the world.  And even those new products developped in other countries are funded and capitalized based on their profit potential in the US.

Previously, I thought I was on the hook to pay 8% of wages only if I did not offer a health care option.  But it turns out that even if our company offers a health care option, we STILL owe the 8% if the employee chooses not to avail him or herself of the company plan.  From the legislation, page 145:

Beginning with Y2, if an employee declines such  offer but otherwise obtains coverage in an Exchange participating health benefits plan (other than by reason of being covered by family coverage as a spouse or dependent of the primary insured), the employer shall make a timely contribution to the Health Insurance Exchange with respect to each such employee in accordance with section 313.

Beyond the costs, the record-keeping requirements are staggering.  I have to keep track of how every employee chooses to get their health care, and have to pay different private and public agencies based on these individual decisions.  Beyond this, for my part time employees (which is everyone), the maximum amount I have to pay varies by the hours worked, meaning the legal requirement for employer health care contribution will vary from employee to employee, and may be different, and change year to year, for all 500 of my employees.

Most of my employees are either on Medicare (which presumably has been paid for with their lifetime Medicare taxes) or on a private retirement health plan.  I have been reading the plan for hours and have not figured out if I will owe money for employees on either of these programs.  Anyone with an insight into this is welcome to email me.

Today, here on Cape Cod, where every car has an Obama sticker, I was struck by two cars which had Obama stickers as well as this same slogan, a paraphrase of a Ben Franklin bon mot:

Those who give up their liberty for more security neither deserve liberty nor security.

I have absolutely no problem with this bumper sticker in its original context, which I presume was to protest things like the Patriot Act, indefinite detentions, and wiretapping during the Bush Administration (and all retained, so far, by this Administration).

But my question back to them would be -- do you still support this statement in the context of pending health care legislation, which is yet another example of trading individual liberty for security, albeit security of a slightly different type?

If the government can tax food because eating too much can increase health care costs, what about sex?  Sex leads to all kinds of medically expensive consequences (STDs, including AIDS; aborted pregnancies; childbirth).  Shouldn't we tax sex as well, by the same logic?

I have written on this topic any number of times, warning that when government pays the health care bills, said payments gives it nearly infinite room to label just about any individual behavior as "costly" to the health care system and therefore fair game for micro-regulation.

Via a reader:

If you happen to be the 1-in-3 Americans who is neither obese nor overweight (and, thus, considered at risk of becoming obese), you might well conclude that the habits of the remaining two-thirds of Americans are costing you, big time. U.S. life expectancies are expected to slide backward, after years of marching upward. (But that's their statistical problem: Yours is how to make them stop costing you all that extra money because they are presumably making poor choices in their food consumption.)

"Facing the serious consequences of an uncontrolled obesity epidemic, America's state and federal  policy makers may need to consider interventions every bit as forceful as those that succeeded in cutting adult tobacco use by more than 50%," the Urban Institute report says. It took awhile -- almost 50 years from the first surgeon general's report on tobacco in 1964 -- to drive smoking down. But in many ways, the drumbeat of scientific evidence and the growing cultural stigma against obesity already are well underway -- as any parent who has tried to bring birthday cupcakes into her child's classroom certainly knows.

Key among the "interventions" the report weighs is that of imposing an excise or sales tax on fattening foods. That, says the report, could be expected to lower consumption of those foods. But it would also generate revenues that could be used to extend health insurance coverage to the uninsured and under-insured, and perhaps to fund campaigns intended to make healthy foods more widely available to, say, low-income Americans and to encourage exercise and healthy eating habits.

Please, please note the text in bold.  They have made overeating a crime with a victim - people who are thin are victims of those who are overweight, and therefore can call on the government to take swift action to protect them.  Eek!  And the LA Times is clearly in love with the idea.   Is it any wonder my chief concern about government health care is not the costs, but the threats to individual liberty?

John Stoessel has further comments.

For those of you comfortably thin who chose to ignore this as not your problem, consider this:  If an overweight person is a threat to a thin person, via the health care charges he might burden taxpayers with, what about, say, a skier?  I don't chose to participate in dangerous sports, so isn't a skier doing a crime against me by the same logic for taking a risk of a potentially expensive injury?  How about a person whose hobby involves dangerous tools.  If TJIC cuts his finger off on his band saw, isn't that costing me money in our new socialist regime?  What about bike riding, or motorcycle riding, or rock climbing, or rugby?  What about any parent that lets their kid play somewhere they could get hurt and cost us mone?

This is why government health care is so dangerous  -- it takes what should be individual decisions with individual consequences and socializes the costs of our personal choices.  Once the costs are socialized, won't control of the choices themselves follow?

Postscript: Again going into morbid mode here, obesity may increase costs for younger patients, but its higher early morbidity actually can reduce lifetime costs.  Basically, morbidly obese people tend to die more often before they grow old enough to get expensive cancers and such.  Several studies have shown lifetime costs for the obese to be lower than for other folks.

Which is not to say that obesity is good, so please do not misunderstand my point.  I would work hard to help someone I loved who was morbidly overweight to get in better health.  Obesity can be bad but its a crappy excuse to take another axe to our free society.

Nancy Pelosi said this the other day (emphasis added)

I'm very pleased that our Chair of our Democratic Congressional Campaign Committee and member of the leadership will be talking too about the immoral profits being made by the insurance industry and how those profits have increased in the Bush years. We all believe in the profit motive; we all want to reward success.  But having that success come at the expense of America's working families "” have that success come by withholding care, when a person becomes ill, is just not right and we're going to take this issue in a new direction.

In the past, other leftish pundits have been even more direct:

It means the health insurance industry is scared that we might actually do something in 2009 and they want to be seen as something other than completely obstructionist. That means only one thing: they've shown fear, and now it's time to bore in for the kill and gut them like trouts. Let's get to it.

I don't have time to redo the analysis, but for the third quarter 2008 (the last quarter of the dreaded Bush years that increased insurance profits so much) I looked up on Google Finance the profit margins of major health care insurers, providers, and HMO's.  I am not sure who the Democrats would consider the real Satan of health insurance (ala ExxonMobil or Wal-Mart) but if I left a key company off you are welcome to suggest it in the comments.  Anyway, 3Q08 profit margins were:

Cigna: 3.50%

United Health Group: 4.56%

Aetna: 3.64%

WellCare:  4.08%

Amerigroup: 3.51%

Humana 2.56%

WellPoint: 5.49%

So, if you are a business owner (and that includes those of you who own equities, which are ownership shares), be very afraid.  Look at your company or your favorite stockholding.  If they have margins of 2.5% or more of revenues (and that includes just about every profitable company in America -- I think the industrial average is in the eights) then Nancy Pelosi and the Democrats consider your profits immorally high and they intend to gut you like a trout.

Update: OK, I had a bit of time to update numbers, so I took Cigna, which is the first on the list, and looked at their net profit margin over 4 years:

2005:  7.6%

2006:  7.0%

2007:  6.4%

2008:   1.5%

Hmm, not sure I see the profits increasing in the Bush years -- looks like they are going down to me.  I would also observe that they never in the last four years even rise to average for a large American public company.

Soon, you may be on the hook for paying for a limitless supply of health care for these people.  (via TJIC)

Update: Good update on issues in the health care bill.

From a MoveOn email I received today (emphasis in original):

But Americans can't afford to wait: while the Senate is on vacation, over 400,000 people will lose their health coverage.

Really?

The source is here.  Reading the text and the sourcing, it is a great example of how a wild-assed guess can be turned into a "fact" if one buries it in a long enough chain of sourcing.  But the really funny part is that the Senate plan does not even begin to be implemented until 2013, and implementation is not complete until something like 2018.  These dates will not change whether the legislation is passed before or after the recess, but if a single month is so devastating, one wonders why MoveOn has quietly accepted the 2013 implentation date (not conincidently after the next Presidential election).

Postscript: Number of extra people who will not, no matter what their insurance status, be able to get critical care in the next month:  zero.

One of the burning reasons we apparently need a government takeover of health care is that it is "expensive," or more precisely, we spend a lot of money on it.

So what?  In everything else I can think of, rising per capita spending and higher spending in the US than elsewhere is a sign of wealth and prosperity, not a "problem."  We spend a lot of money on a lot of sometimes trivial sh*t, and no one blinks.  We spend more money because we have more beyond what we need to keep ourselves alive.  Or we spend more money because technology provides us new options and frontiers.  But when we spend a lot of money on our health and well-being and longevity, its a problem requiring massive government intervention?

I am coming back from vacation today, but just as a quick note, Bruce McQuain has another good post on the current health care bills and Obama's press conference.  In that post, he links two very good posts that provide more facts and discussion around my claim yesterday that health care savings from "preventative medicine" are mostly a myth.  Those two posts are from a physician and from the Manhattan Institute.

And here is McQuain again on the CBO's testimony on the health care bills.

[Democratic Senator] Conrad: Dr. Elmendorf, I am going to really put you on the spot because we are in the middle of this health care debate, but it is critically important that we get this right. Everyone has said, virtually everyone, that bending the cost curve over time is critically important and one of the key goals of this entire effort. From what you have seen from the products of the committees that have reported, do you see a successful effort being mounted to bend the long-term cost curve?

[CBO director] Elmendorf: No, Mr. Chairman. In the legislation that has been reported we do not see the sort of fundamental changes that would be necessary to reduce the trajectory of federal health spending by a significant amount. And on the contrary, the legislation significantly expands the federal responsibility for health care costs.

No, not the one that said everyone who likes their current health plan can keep it, though that clearly is a whopper.  This is the one that fascinates me:

[Obama said] if doctors have incentives to provide the best care, instead of more care, we can help Americans avoid unnecessary hospital stays, treatments and tests that drive up costs.

What he is referring to is the fact that if doctors prescribe more procedures, they make more money.

I spent years as a consultant  working with incentive programs in corporations.  They are very tricky things.  It is much harder to create incentives for the wrong behavior than the right behavior.  But I don't think you need similar experience to dissect this plan.  Because there is absolutely nothing of real substance in this plan, or any HMO has discovered, that will truly create incentives for "the best care."  It just doesn't work with doctors.  I know doctors, and when Obama says "best care" he means saying no to a lot of things.  That is not how doctors would understand the phrase.  I worked with Kaiser-Permanente for about a year as a consultant, and this was a constant source of friction between the Kaiser business people and the Permanente medical staff.

Really, all Congress and Obama are doing is twiddling one knob called "payment model" and the knob only has two settings - either create incentives for the doctor to do a lot for the patient by paying for individual services, or create incentives for the doctor to do as little as possible for the patient and resist every plea for a test or specialist referral.  Basically, Obama's intention is to flip the switch from the former to the latter position, similar to what is being done currently in the Massachusetts health plan with switching to capitated payments from fee for service for doctors, and similar to the strong HMO model that pissed so many people off years ago that many states banned practices Obama is implementing nationally.

Yeah, I know the response, that somehow "preventative medicine" will reach the golden mean.  Forget it.  Preventative medicine is great as a spur to individual well-being, but does little to reduce total system costs**.  Waving around the flag of "preventative medicine" is about as believable as when politicians say they will make up budget gaps with savings and efficiency.  Basically, the next time we see either will be the first time.

** This kind of thing always sounds heartless, but for example it is actually cheaper not to find a cancer until its almost too late.  An expensive operation may be called for, but a quick death is actually cheap for the system.  Finding a cancer early means expensive treatments now, and probably expensive treatements later in a longer life.  I much prefer the latter, but it is more expensive.  You can't get around that.  The big wins in reducing health costs rom preventative medicine are in public health and nutrition, and most of those battles are won.  There may still be some savings in pre-natal care, but even that is iffy.

There are a lot of problems with the health care bills in Congress.  At the end of the day, I will endure most of them, as I have every other indignity thrown at me by the Feds.  If they charge me 8% of my company's payroll as a health care tax, well, we can probably raise prices, particularly in the inflationary spiral the Fed has set us up for.  I will be sad to see the most successful in this country punished with high new taxes, but these taxes mostly won't apply to our family.  And I will find some way to get my family the health care it needs, even if we have to fly to India to do it.

But my biggest fear is for individual liberties, with the effect I have called "the health care Trojan Horse for fascism."  We all know that the government has developed a taste for meddling in the smallest details of our lives.  But as more of the nation's health care spending flows though government hands, nearly every decision you make will suddenly affect the government's budget.  What you eat, how heavy you are, whether you smoke, whether you play an athletic sport where you can get hurt, whether you pursue dangerous hobbies like rock climbing or skiing, whether you wear a bike or motorcycle helmet, whether you have a seat belt on, whether you drink alcohol, whether you like to use dangerous power tools -- all these become direct inputs into government spending via medical bills the government is paying.  And if you think that Congress will avoid legislating on these activities once it inevitably gets in financial trouble with health care, you have not studied much history.

And all this avoids discussion of other powerful individual liberty-related topics, such as the ability to get the end of life care you want or whether the government will even allow you to go "off plan" with your own money if you disagree with its Commissar's rulings on what care you should and should not receive.

It's fascinating for me to watch all these children of the sixties in the Democratic Party, most of whom screamed (rightly) at George Bush continuing to implement new plans where we give up individual liberties for security.  But here come those exact same people, with the exact same message - because this is what health care reform is about, at its core - giving up individual liberties in exchange for a (perceived) increase in security.

Those of you who may be encouraged by the reports of disagreements and problems among Democrats in reachi9ng consensus on a health care takeover, don't be too encouraged.    This appears to be exactly like the run up to Waxman-Markey.  If this is the case, these cries by certain Democrats of problems in the bill are really thinly disguised pleas for bribes.

Recalcitrant Democrats  in Congress know that Obama will be happy to spend tens of billions in taxpayer money to buy off the votes he needs to pass these bills.  This is how they got over the hump in the House with Waxman-Markey, and you can expect the same thing to happen again, and happen fast, on health care.  In fact, I expect the bribes to be higher than the $3.5 billion per vote clearing price on Waxman-Markey.  Obama knows that only steamroller tactics will pass a bill -- if he pauses even for a second to let opponents have time to take their case to the public (or even to finish reading the bill) he will likely lose.  Sunlight is his worst enemy right now, and he will gladly spend our money for porkbarrel projects in key districts to avoid it.

The NY Post has a very good editorial on the health care bills (HT:  Q&O).  Too much good stuff to excerpt, it includes even more crazy provisions in the House and Senate bills I had not seen yet (its like a scavenger hunt as people go through the 1000 pages, or maybe more like searching for landmines).

But since the bill doesn't even start taking effect until 2013 (except for the higher taxes, which come earlier, of course), we have to really really rush and make sure its approved before the August recess (and before critics are able to actually read the thing - no chance those in Congress will read it, ever).  Also, its such a burning problem, it just must be solved now, as evidenced by...

The most recent ABC News/Washington Post poll (June 21) finds that 83 percent of Americans are very satisfied or somewhat satisfied with the quality of their health care, and 81 percent are similarly satisfied with their health insurance.

They have good reason to be. If you're diagnosed with cancer, you have a better chance of surviving it in the United States than anywhere else, according to the Concord Five Continent Study. And the World Health Organization ranked the United States No. 1 out of 191 countries for being responsive to patients' needs, including providing timely treatments and a choice of doctors.

I have written a number of times, the fact that we spend more on health care is not a bug, its a feature.  We are the wealthiest nation on earth, and there is only so much we can spend on food, clothing, shelter, plasma TV's and other necessities.  We choose to spend a lot of that extra money on our health and longevity.  Why is that a bad decision?

Not much I even need to add to this, via Riehl World View:

On Tuesday, the Senate health committee voted 12-11 in favor of a two-page amendment courtesy of Republican Tom Coburn that would require all Members and their staffs to enroll in any new government-run health plan. Yet all Democrats -- with the exceptions of acting chairman Chris Dodd, Barbara Mikulski and Ted Kennedy via proxy -- voted nay.

In other words, Sherrod Brown and Sheldon Whitehouse won't themselves join a plan that "will offer benefits that are as good as those available through private insurance plans -- or better," as the Ohio and Rhode Island liberals put it in a recent op-ed. And even a self-described socialist like Vermont's Bernie Sanders, who supports a government-only system, wouldn't sign himself up.

Does anyone else find this reminiscent of Obama's decision to send accept a scholarship for his own education, send his kids to private school in DC, and then, nearly as his first action as President, kill the voucher program that let other African American kids in DC go to private school.

Sometimes one molecule of active ingredient diluted into the entire volume of the world's oceans still isn't enough of a pick-me-up on a Friday afternoon.  So I leave you with this, via John Stoessel:

Anyone want to bet that things like homeopathy will get included in the government's "must cover" rules under the new health proposal?