Health care spending at a fifty year low?

17 May

2013

CBS News reports this:

On a conference call with reporters, HHS secretary Kathleen Sebelius said the country has made strides in reducing medical costs, and national health care spending has fallen to a 50-year low. However, she said there is still more to do.

Still more to be done? Either Secretary Sebelius is misquoted or she has no clue what she is talking about. Does anyone seriously believe that national health care spending is now at the level it was in 1963? That would mean your health insurance premium should be what you paid in 1963 as well.

I’m chalking this one up to a reporting error or the greatest spin in history.

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Are health care costs going down, up or nowhere?

16 May

From the Wall Street Journal, May 7, 2013

Two new economic analyses suggest a recent slowdown in health-spending growth may reflect lasting change due to fundamental shifts in how health care is delivered and paid for.

The findings come as economists and policy experts debate whether the damped growth is a temporary phenomenon tied to the recession and its aftermath or is more linked to permanent changes, such as increased efficiency among health-care providers.

The implications for the economy and the federal budget are huge, since health-care costs make up a significant share of both. Health spending represented 17.9% of the gross domestic product in 2011.

The studies, appearing in the journal Health Affairs, take different approaches. One looked at spending on health care for about 10 million to 12 million people who had insurance through large employers between 2007 and 2011—an approach that sought to cancel out the recession’s job-loss effects on health coverage.

The analysis found that spending growth even among employer plans dropped in 2010 and remained relatively low in 2011. About 20% of the effect was due to increased deductibles and other out-of-pocket costs that workers faced, the authors found. The rest, they suggested, might reflect slower spreading of new health-care technology or more conservative care patterns by providers.

So, the year Obamacare was enacted automatically changed care patterns … instantly … and permanently? Ah, not so much. It would be nice if the health care system suddenly became efficient and each physician changed his way of practicing health care… someday maybe.

I should mention another recent study attributed the slowing of costs mostly to the economy, who knows, but logic would tell us that we have yet to see any fundamental changes to cause a lasting change. What we have seen is cost-shifting to workers and higher costs from new mandates.

Does the IRS fear smaller government?

16 May

2013

Let’s assume the President or even top aides had nothing to do with the IRS scrutinizing certain conservative groups who generally are opposed to big government and hence big bureaucracy.

But rather assume that government workers concerned with their jobs and their good package of pay and benefits had a strong vested interest in keeping both.

Is it too far fetched to ask if some bureaucrats would act on their own to preserve the status quo? Today it is the IRS, but tomorrow you have a whole new bureaucracy with a vested interest in Obamacare and all its complexity and soon with millions of Americans enjoying their new entitlement.

This is scary stuff. The story of bureaucrats using their considerable power in their best interest to suppress those who criticize is something I read about in the GDR museum in Berlin.

If banks can be too big to fail as is feared by many on the left, can’t government be too big to work and manage?

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IRS Releases 2014 Indexed Amounts for HSAs, HDHPs

15 May

On May 2, the U.S. Treasury Department and Internal Revenue Service (IRS) released Revenue Procedure 2013-25, which lists the 2014 indexed amounts, adjusted for inflation, for health savings accounts and high-deductible health plans (HDHPs). (In some cases, this resulted in no change from the prior year.) The following table lists the current 2013 amounts and the new 2014 amounts:

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Provided by the American Benefits Council

The use of High Deductible Health Plans is growing rapidly and within a few years may become the dominate plan in the corporate world. These plans favor higher income people because of the high out of pocket costs, but to those who can pay such expenses or to individuals with very modest health care expenses, they provide a vehicle to accumulate money for health care in retirement.

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Doctors Rush To Accountable Care Approach

15 May

I Want Your Money

2013

Interesting headline is it not? What it really says is doctors are rushing to have a lower income. Don’t believe it. Back in the 1980s doctors rushed to HMOs, especially the individual practice association (IPO) type. They did this as a defensive mechanism to protect their interests and their income. I find no reason to believe things are different now. Contrary to popular opinion these doctors in Medicare ACOs will still be paid on a fee for service basis. They will be eligible for bonus payments if they save money. Is it in their best interest to save money? Time will tell. However, faced with the threat of having ones fees cut and faced with increased pressure from insurances companies, the perception of a Accountable Care Organization may be an attractive strategy.

You might find the full article of interest. There are not many of us around these days who remember the gyrations of health care over the last fifty years. After all, at one time second opinions and pre-admission testing was going to be our salvation. I’m thinking we are entitled to a hefty amount of cynicism.

From Forbes.com
Bruce Japsen, Contributor
PHARMA & HEALTHCARE | 4/27/2013 @ 12:30PM

Doctors Rush To Obamacare’s Accountable Care Approach
Nearly one in four doctors are in or planning to link with an accountable care organization within a year, a new Medscape study shows. AFP/Getty Images

The number of physicians participating in the emerging medical care delivery system known as “accountable care organizations” (ACOs) has tripled as the health care industry moves further away from fee-for-service medicine.

No trouble at the IRS on this one. Working where there are outstanding benefits- – - “that go beyond those in the private-sector”

14 May

I have nothing against people who work for the IRS or any government agency. I am sure they are as hard working as anyone in the private sector, but does that mean they are entitled to a total compensation package that puts the vast majority of private employers to shame … and with a good measure of job security to boot?

According to what we see here, you are providing government employees with “one of the best retirement systems in the world.” Lets not forget their pension also includes an annual COLA. I hope that gives you a sense of satisfaction as you consider your own “retirement system.”

Take a look at this description of employee benefits from the IRS website; not bad huh? There was never a time in America when the majority of Americans enjoyed such benefits. Today only a few of the largest employers can equal this package.

Benefits

Make Your Career Work for You, Wherever You Go

If you’d like to capitalize on your expertise, the IRS is the place to do it. We offer federal benefits that go beyond those in the private-sector, plus you get the career benefits you’re looking for — from a fulfilling and stable career to a flexible work schedule, to a being part of an inclusive work environment that’s focused on serving America.

Use Our Benefits to Your Benefit

Here are the basics on what you’ll receive as an IRS employee:

Health Insurance
Choose from several health insurance options, including supplemental dental and vision.

Health Insurance: FEHB provides health insurance plans to fit you and your family’s needs and budget. The IRS pays approximately 2/3 of your health insurance premium. You may be eligible to carry your health insurance coverage into retirement.

Supplemental Dental and Vision Insurance: Federal Employee Dental and Vision provides insurance to federal employees. You must be eligible for the FEHB program to be eligible to enroll.

Long Term Care
The Federal Long Term Care Insurance Program (FLTCIP) lets you plan for healthcare coverage you may need in the future, as well as comprehensive coverage if you become unable to care for yourself. So you’ll have help paying for nursing home, assisted living facility, home health, hospice, respite, and other long-term care services.

Flexible Spending Accounts
Save more of your money by applying it to a tax-lowering Flexible Spending Account that enables you to set aside money for certain health care and dependent care expenses each year.

Federal Retirement
Although retirement may be in your distant future, you know you’ll need it someday. So launch your career with one of the best retirement systems in the world. The Federal Employees Retirement System (FERS) is comprised of three components: a basic benefit (annuity), a Social Security benefit, and the Thrift Savings Plan (like a 401(k) plan). In short, FERS:

Allows you to take the Social Security and Thrift Savings Plan components to your next place of employment, even if you leave federal employment.
Provides benefits for retirement, disability and survivors.

The Thrift Savings Plan
Often called the TSP, this plan is similar to the 401(k) savings and tax benefits plans available in the private sector. Here’s how you can build your “nest egg”:

We’ll set up and automatically contribute 1% of your basic pay toward your Thrift Savings Plan account, whether you contribute to it or not.

If you do contribute to the TSP, we’ll match your contributions dollar for dollar up to 3%, and 50 cents on the dollar for the next 2%.

All of your contributions will be made from pre-tax dollars, and your investments and earnings will be tax deferred until you withdraw them.

Five Thrift Savings Plan investment funds are available for you to choose from.

You may transfer money from other eligible retirement savings plans into your Thrift Savings Plan account.

In some cases, you can borrow against your Thrift Savings Plan. If you change federal employment, your Thrift Savings Plan will go with you.

Life Insurance
At the IRS, not only do we pay for 1/3 of your basic premium, but basic coverage allows you to elect and pay for optional coverage for yourself or certain family members. You can choose from a wide variety of life insurance coverage through the Federal Employees’ Group Life Insurance.

Flexible Work Life Programs
We’re committed to helping you balance your work and family life through these great programs:

Flexible Hours: Pursue your work opportunities on a schedule that works for you.
Telework: Your job and work assignments may allow you to work from home or other work sites.

Transportation Subsidy: We’ll help you pay for your monthly commuting costs to and from work. These benefits are not taxable and are not included on Form W-2.

Health Care Unit: Flu vaccines, allergy shots, smoking cessation programs and health risk assessments are just a sampling of the health services you can participate in.

Fitness Centers: Stay in shape at our fitness centers, collocated in more than 25 IRS facilities across the country. There is no membership fee.

Credit Unions: We help make banking convenient for you. Many of our facilities have a credit union on premises.

Cafeterias: Hungry? Grab a bite to eat at our on-location cafeterias that serve breakfast and lunch.

Employee Assistance and Work/Life Referral Services: If you need help overcoming stressful issues or personal concerns, our Employee Assistance Program is here for you and your immediate family members. Services are confidential and free, around the clock.

Child Care: GSA manages in 31 states, the District of Columbia, and Puerto Rico. We work with them to provide on-site child care at 10 of our IRS facilities.

Leave Share Program: Help others, help yourself. This program allows our full- and part-time employees to donate their leave time. Then, if someone’s regular leave share is exhausted and they need to handle a medical emergency, the leave bank can provide them with more time off.

Employee Suggestion Program: Some of the best ideas for improving our work efficiency and environment have come from people like you. And you could receive up to 25% of the tangible first-year savings that result from your suggestion if it’s adopted.

Training and Development
You want to improve your skills, grow professionally and attain your career goals. Our goal is to give you all the tools and opportunities to do that. So we’ll encourage you to establish a Career Learning Plan to identify your general, specialty or technical training needs. Then you can take advantage of our wide variety of professional development and training resources.

In the event you think this is only half the story, let’s consider pay. Take a look at this from the Washington Post:

The figure commonly cited as the “average” federal employee salary now stands at nearly $78,500, an amount that has risen by about $1,800 in the last two years despite a general freeze on salary rates during that time, according to data released Monday.

The Office of Personnel Management reported that as of September 2012, the average salary for a full-time, permanent, non-seasonal position was $78,467. The comparable figure for December 2010 was $76,701.

The median salary — the point at which half are above and half are below — is now $74,714, up from $69,550 in 2010.

Talk about opportunities for sequester!

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A warm and fuzzy feeling about health care, when incentives affect you

13 May

2013

Part of Obamacare imposes a penalty on hospitals for excessive re-admissions of Medicare patients. The idea is that hospitals need to do a better job preparing patients for discharge and also to provide better follow up after discharge.

There is considerable controversy over the program. Is it working, is it necessary, is it having an adverse affect on some hospitals, is follow up care the hospitals responsibility?

I don’t know the answers, but like most people I assumed patients were discharged appropriately and their doctor followed them from that point. Apparently, faith in the health care system is misplaced.

Read this excerpt from a letter to the editor in support of the program:

Supported by the right financial incentives, hospital leaders are organizing systems of care that didn’t exist before to help patients get the care they need after they leave the hospital.

Who knew financial incentives (penalties) could create new systems for health care?

Of course I am kidding, we all knew our blind faith in all aspects of the health care system were misplaced … didn’t we? Nevertheless, to think we are getting less than optimum care because there was no incentive to do so is scary stuff.

Just remember, if there are incentives to not provide care, there are just as strong incentives to provide too much care. Obamacare contains several programs to lower costs by changing how health care is delivered which means somebody is making less money. That may be desirable for both savings and better health care, but the real test is how those with less income compensate for the loss. Think about it.

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