Prescription for Disaster

The Future of Health Care Innovation

Monday, May 14, 2012
ObamaCare imposes a series of tax hikes - including on medical innovators. Grace-Marie Turner explains exactly what this will mean to patients and their health care:

"ZOLL Medical Corporation is one of the medical device companies in the bull’s eye of ObamaCare. ZOLL President Jonathan Rennert explained that the new taxes the law imposes on his company’s revenue – revenue, not profits – will raise ZOLL’s tax rate to greater than 50%, which will in turn drastically curtail the company’s investment in research and development.  'The medical device tax would have completely wiped out our profit if it were in effect over the last several years,' Rennert said.  'Every one of the jobs in our company is now in the U.S. But we will have every incentive to move jobs offshore” when the tax takes effect in 2013.  The medical device tax will lead to less innovation, fewer jobs, and fewer lives saved.'"

Read the full article here.

Be sure to follow AHEC on Twitter @TheAHEC and at Facebook.com/TheAHEC. 

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The Future of Health Care Innovation

Monday, May 14, 2012
ObamaCare imposes a series of tax hikes - including on medical innovators. Grace-Marie Turner explains exactly what this will mean to patients and their health care:

"ZOLL Medical Corporation is one of the medical device companies in the bull’s eye of ObamaCare. ZOLL President Jonathan Rennert explained that the new taxes the law imposes on his company’s revenue – revenue, not profits – will raise ZOLL’s tax rate to greater than 50%, which will in turn drastically curtail the company’s investment in research and development.  'The medical device tax would have completely wiped out our profit if it were in effect over the last several years,' Rennert said.  'Every one of the jobs in our company is now in the U.S. But we will have every incentive to move jobs offshore” when the tax takes effect in 2013.  The medical device tax will lead to less innovation, fewer jobs, and fewer lives saved.'"

Read the full article here.

Be sure to follow AHEC on Twitter @TheAHEC and at Facebook.com/TheAHEC. 

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Sen. Hatch Comments on Need for Medicaid Flexibility for the States

Wednesday, November 30, 2011
Senator Orrin Hatch (R-UT), ranking member of the Senate Finance Committeee, weighed in on a report from the National Governor's Association about the burden that Medicaid, and its expansion under ObamaCare, imposes on the states. From his November 29, 2011 Press Release:

"[T]he National Governors Association’s (NGA) Fiscal Survey of the States demonstrates why repealing the Medicaid Maintenance of Effort requirement, first imposed in the stimulus package and again in the $2.6 trillion health spending law, and modernizing the Medicaid programs is essential to allowing states effectively manage their Medicaid programs." 

"The report released today found that state budget deficits cumulatively amount to at least $365 billion over the next five years and that Medicaid enrollment is up by 17.7 percent with this joint federal-state program making up the largest portion of state budgets. The NGA also found, "spending on Medicaid is expected to consume an increasing share of state budgets and grow much more rapidly than state revenue growth, resulting in slow or no growth in education, transportation or public safety.

Reports about Medicaid can be found: here (from the RGA) and here (from Members of Congress). 


Be sure to follow AHEC on Twitter @TheAHEC and at Facebook.com/TheAHEC.


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Why Republican Budget Reforms are Better than Obama's

Friday, April 22, 2011
Avik Roy at The Apothecary details how liberal attacks against House Budget Committee Chairman Paul Ryan's budget, specifically his proposal for how to reform Medicare and rein in costs, are inconsistent with their praise of ObamaCare.

Both ObamaCare and Ryan's Path to Prosperity rely on tying Medicare's inflation to the lower general inflation rate rather than the much higher health inflation rate.  Buy Roy points out a significant difference: "Republicans seek to curb Medicare spending by giving seniors more control over their health spending, whereas Democrats seek to invest more power in the 15-member Medicare Independent Payment Advisory Board (IPAB)."  As AHEC has previously explained, the IPAB is a bureaucracy that must propose Medicare cuts as annual Medicare spending nears the yearly cap.  Similar systems, in countries like England, have experienced the denial of access to services for the last part of a fiscal year.  

For example, government health care might cover a hip replacement surgery from October 1 (the beginning of our nation's fiscal year) through May 15 but then the IPAB cuts come into effect making that surgery unavailable to Medicare patients for the rest of the fiscal year.  The negative effects of this are obvious.  First, this will cause patients to have to wait for necessary procedures based on the arbitrariness of the federal government's fiscal year.  This wait may be painful in some cases and life-threatening in others.  Second, once the new fiscal year starts there will be a long waiting line in the rush for services (extending the waiting period further).  As seen in other areas, when the government creates scarcity the government creates drastic market distortions.  Third, the government will not only decide when people receive care but the government's distortion of the healthcare market will require the government to next come up with a triage system to prioritize when people get care.

The Republican's plan is much, much better.  The Republican plan takes the government out of this process.  Patients would decide whether, and when, they receive care.  Like most Americans, I trust my own ability to make my healthcare decisions for more than I trust a government bureaucrat.

Be sure to follow AHEC on Twitter @TheAHEC and at Facebook.com/TheAHEC.



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Ideas for Real Reform

Friday, March 18, 2011
Nina Owcharenko of The Heritage Foundation has laid out a road-map for what real healthcare reform would look like - after Congress repeals ObamaCare.  The ideas will constitute real reform, expand consumer choice, truly bend the cost curve downward and lower the deficit.  The ideas include:

  • Tax Reform: Extend individuals the same tax benefits that businesses have when providing insurance to their employers.  This policy undermines portability.  By making this change to the tax code individuals would control their own healthcare and the loss of a job would not result in the loss of insurance.  
  • Entitlement Reform: convert Medicare and Medicaid from defined-benefit plans. For Medicare, retiring seniors could keep the insurance they have and the government would provide defined contribution premium assistance to seniors who qualify.  For Medicaid, the government could also provide direct assistance to enrollees to purchase private health insurance.  This would be particularly beneficial to people who waiver back and forth between Medicaid eligibility: the premium assistance might phase out but individuals wouldn't lose their private insurance and wouldn't have to switch doctors.
  • Insurance Market Reform: Congress should take a number of steps to remove barriers to a flexible insurance market that serves the consumers, including allowing the purchase of insurance across state lines and by extending protections to people who switch from one individual plan to another (according to Owcharenko, this coverage is available to people who go from employer plan to individuals, vice-versa and from an individual to employer plan but not an individual plan to an individual plan).
  • State Reforms: Congress should start by giving states more flexibility and, for their part, states should roll back mandates and costly regulations and also engage individuals in Medicaid to take a greater roll in the decisions affecting their healthcare.

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Sen. Enzi Issues Statement About One Year Anniversary of ObamaCare

Thursday, March 17, 2011
Yesterday, Senator Mike Enzi (WY) issued the following press release on the implementation for ObamaCare:

One Year Anniversary Of Health Reform Full Of Empty Promises; Less Choice, Higher Costs, New Taxes, Enzi Says

Wednesday, March 16, 2011

Washington, D.C. – Marking the one-year anniversary of the most sweeping health care legislation that the federal government has ever produced, Senator Mike Enzi (R-Wyo.), Ranking Member of the Senate Health, Education, Labor and Pensions (HELP) Committee, today said reform is turning out to be an empty promise that threatens jobs, small businesses and the financial security of families across the country.

“This new law is driving up health insurance premiums, forcing people to change their health plans and killing jobs,” Enzi said. “Americans were promised ‘If you like what you have you can keep it,’ but that is turning out to be nothing but an empty promise.”

During a press conference today, with Senators from the HELP and Finance Committees, Enzi focused on a string of disappointments resulting from the bill, including:
  • $500 billion in Medicare cuts and $500 billion in tax increases.
  • Unrivaled expansion of the federal government’s involvement in the lives of everyday Americans. 
  • Dramatic increases in health insurance premiums, including a 59 percent increase announced by the not-for-profit California insurer, Blue Shield, for some of their individual market plans.
  • Costly changes in tax laws, such as the 1099 form requirement, which, on top of higher health insurance premiums, will force employers to eliminate jobs and reduce wages.
“When the Administration’s own estimates say 80 percent of small businesses will lose their current insurance plans and be forced to purchase more expensive plans, it is clear this is not the right prescription for health reform,” Enzi said. “Congress needs to pursue a step-by-step, bipartisan approach to health reform that will reduce costs, expand coverage and allow our economy to expand. This law will not help us reach that goal – not ever.”

Enzi promised to focus on ways to eliminate provisions in the new law that will increase choice in health care while decreasing health care costs. “We must make health care more affordable, both for consumers and the federal taxpayer,” he said.

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One Year After ObamaCare: AHEC's Primer for Policymakers

Wednesday, March 09, 2011
As America nears the one-year anniversary of ObamaCare becoming law, AHEC has released a new document entitled: "A Policymaker's Primer on ObamaCare: The Myths, the Costs and a Practical Guide to Defunding the Government Takeover of Healthcare in the 112th Congress."

The following is the Primer's Abstract:

On March 23, 2010, President Barack Obama signed into law the Patient Protection and Affordable Care Act, which is commonly referred to as ObamaCare. This law includes a series of provisions that will have a dramatic impact on America’s healthcare system, including: (1) increased taxes and compliance burdens imposed on small businesses; (2) changes to HSAs that make them less useful to individual consumers and increased fines for non-qualified distributions; (3) deep cuts to Medicare Advantage, the free-market portion of Medicare; (4) a significant expansion of Medicaid, which will threaten state budgets; and (5) an unprecedented use of the Constitution’s commerce clause to justify the imposition of an individual mandate requiring individuals to carry health insurance or face serious tax penalties. Supporters of the law have made a series of promises about this law, including that it will reduce costs and expand access to insurance. Opponents of the law, however, note that these promises have proven false, and that the law will actually increase insurance costs, increase federal budget deficits, and damage the U.S. economy. In response to the clearly negative impact the law will have on businesses, individual consumers, and America as a whole, this primer concludes that it is necessary to repeal ObamaCare and recommends a course of action for state and local policymakers to achieve that objective.


The document is available on AHEC's website here and can also be found in the Policy & Analysis area of AHEC's website.

Be sure to follow AHEC on Twitter @TheAHEC and at Facebook.com/TheAHEC.

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Interesting Analysis of How ObamaCare Will Transform American Medicine

Sunday, February 20, 2011
Writing about the future of healthcare on Health Affairs Blog, one analyst has considered the implications of ObamaCare and found it will push people out of insurance and lead to fewer choices for many Americans.   The author, John Goodman, writes ObamaCare "will [not] be the kind of change anticipated by the people who gave us the Affordable Care Act (ObamaCare)."

Instead, Goodman writes that instead of bringing "millions of people into the health insurance system." Obamacare will "push millions of people (at least partially) out of it."   He notes that the supporters of ObamaCare sought to create a system in which everyone has equal access to care but that under the law the effect "will be the exact opposite — a two-tiered system in which access to the best doctors and the best facilities will depend very much on your ability to pay."  Additionally, ObamaCare was supposed to "create universal access to care.  Yet our more vulnerable populations — the poor, the disabled and the elderly — are likely to have less access to care under the new reforms than they have today."

No wonder the American people oppose ObamaCare - it will push people out of insurance, put healthcare out of reach for many, and create a lack of access to care for the most vulnerable Americans.
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Medical Technology Companies Fleeing United States?

Tuesday, January 18, 2011

The Wall Street Journal has a frightening blog post today about the possibility that American medical technology firms will leave the United States for emerging-market countries, especially because of all of the burdens and regulations in the United States.  It is worth noting that ObamaCare imposes stiff fines and taxes on these innovators who create life-saving technologies and medical devices.  Why, exactly, do Democrats think it is a good idea to drive our medical innovators abroad?  

An excerpt from the blog posting:  The report [from PriceWaterhouseCoopers] scores countries by five measures of innovation and sees the U.S. losing ground in all of them — price incentives, resources for innovation, a supportive regulatory system, patient demand and price sensitivity and a supportive investment community.


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