A Blunt Instrument

As of January 1, 2018, Seattle has placed a tax — it’s officially called a “sweetened beverage recovery fee” — on sugary sodas and “sports drinks” like Gatorade.  Costco, the big box membership club retailer, has responded by placing signs showing consumers the specific impact of the tax on the Costco price for the product — and it’s a whopper.

video__sugar_tax_sticker_shock_0_10405324_ver1-0_640_360The Costco signs show that the Seattle tax adds $10.34 to a Gatorade 35-bottle variety pack — the kind you might buy if you were responsible for buying refreshments for your kid’s sports team to consume after a practice.  The price of the product was $15.99, but with the new tax the price is now $26.33.  The tax added $7.56 to a 36-can case of Dr. Pepper, bringing the price from $9.99 to $17.55.  Costco also helpfully added signage to explain the tax-related increase to its customers and remind them that they can avoid paying the additional cost simply by going to a nearby Costco located out of the city limits.  Some customers have told local TV stations they plan on doing just that.  There’s also been lots of social media chatter about the Costco signs and the impact of the tax on prices.

What’s the point of the tax?  Seattle evidently is concerned about obesity, which some studies have linked, at least in part, to the consumption of sugary soft drinks.  Seattle hopes that by imposing a substantial tax on soft drinks and “sports drinks,” it will incentivize people to make healthier choices.  But get this:  the tax exempts sweetened products from certified manufacturers with annual worldwide gross revenue of $2 million or less, and products from certified manufacturers with gross revenue of more than $2 million but less than $5 million pay a much smaller tax.  That exemption is a purely political decision that doesn’t make sense as a public health issue, because the size of the producer obviously doesn’t change whatever the impact of the product might be.  Seattle’s approach also focuses only on sweetened drinks, and doesn’t address products like ice cream, candy bars, “snack foods,” or frozen pizza that might also be said to contribute to “unhealthy lifestyles.”  And, of course, it doesn’t begin to address other issues that contribute directly to obesity, such as lack of exercise.

Other cities, like Chicago, have tried soft drink taxes and dumped them in the face of business opposition.  Costco is providing a salutary service by alerting its customers to the specific cost impact of the tax so they can factor it into their decision-making.  The Seattle experiment, as illuminated by the Costco signs, reminds us, yet again, that taxes are a pretty blunt instrument when it comes to trying to change behavior and achieve broader policies — and that taxes are always going to be affected by political considerations, too.


Trump’s Business Approach

Here’s a surprise:  Congress is mired in disputes about the new legislation that is supposed to “repeal and replace” the Affordable Care Act (or at least claims to do something to deal with the ongoing problems with President Obama’s signature legislation).  There was supposed to be a vote on the legislation on the floor of the House of Representatives yesterday, but the tally got postponed over concerns that the legislation might fail.

President Trump has been involved in the wrangling, and last night he weighed in with what the Washington Post described as an “ultimatum.”  According to the Post, Trump told the Republicans in the House to either pass the legislation on Friday, or reject it, in which case Trump will move on to other items on his agenda.  Trump apparently will leave it up to the Republicans in the House to figure out whether they can agree or not.

the-interview-donald-trump-sits-down-with-business-insiderIt’s an interesting approach, and I suspect that it comes from Trump’s years of working in the business world.  Corporations typically don’t engage in open-ended negotiations, allowing events to marinate and slowly come together — which often seems to be how Congress works (if you believe that Congress works at all).  Instead, because there’s a time value to money and limits to corporate resources that can be expended on potential deals that don’t materialize, corporations set establish priorities, set deadlines, and push.  Once a deadline gets set, it becomes another means of applying pressure to the parties to reach an agreement, and if the deal doesn’t get done by the deadline, typically that takes the transaction off the table, the corporation moves on, and there is no going back.

Trump’s approach to this legislative test is, obviously, also informed by political considerations; he wants to set a deadline so members of Congress are actually forced to do something concrete, and we don’t have the lingering story of “what’s going to happen to Obamacare” attracting all of the media attention and detracting from the other things he’s trying to accomplish.  It’s a gamble, because if the legislation Trump is backing doesn’t pass, he could be painted as a failure in the early months of his Administration, making it less likely that he’ll be able to obtain passage of other parts of his agenda, like tax reform.  We already knew that Trump is a gambler, of course — his whole campaign was a bizarre, otherworldly gamble that paid off.  Now he’s bringing some of that high-stakes, business world approach to the legislative political realm.

We shouldn’t be surprised, by now, that Trump is going to continue to gamble and continue to do things in confounding ways.  Today we’ll get another lesson in whether his approach can actually work in Washington, D.C., even on a short term basis.

Meanwhile, Back At The Issues . . . .

While our easily distracted nation has been preoccupied with political horse races, insults on debate stages, and brawling at campaign rallies, some of the real issues facing the country plod on.  It’s just that no one is paying any attention to them.

Consider the Affordable Care Act, known colloquially as Obamacare.  It’s been up and operational for several years now.  So, how is it doing?

A man looks over the Affordable Care Act signup page on the HealthCare.gov website in New York in this photo illustrationIt turns out that Obamacare is facing a number of challenges and is in what a recent Washington Post editorial describes as “an awkward place.”  The problem is that although people are still enrolling, they’re not doing so at the rates that were forecast when the new law’s financial viability was evaluated.  If there are fewer enrollments than were estimated, or the mix of new enrollees doesn’t include as many young and healthy people as was originally projected, then the Affordable Care Act could produce substantial premium price increases rather than what the statute’s name promises.

Another aspect of this complicated law is whether it is offering good insurance choices for people.  The Investor’s Business Daily recently published an article that focused on how the Affordable Care Act is working in Mississippi, which is one of the underinsured places that were a focus of the statute in the first place.  The IBD article found that enrollments of uninsured people in Mississippi were disappointing — just 38% of those eligible for subsidies — that the premium costs for the cheapest “bronze” plans are spiking, and that the increased expense may cause some people to opt for paying the uninsured, individual mandate tax rather than buying insurance as they are supposed to do.  Still other articles, from the New York Times and elsewhere, have reported that many people believe that while subsidies might be holding down premium costs in some states, high deductible amounts, which require the insured person to pay cash out of pocket before the insurance kicks in, are making some plans bought on the exchanges unaffordable and unusable.

The Affordable Care Act was a huge new governmental program, hotly debated and the subject of strong opposition from Republicans.  How is it working, really?  We deserve to know, and un any rational world, candidates of both parties would be debating that very important issue.  In this crazy year, however, the news media and the public have been distracted by the Trump phenomenon and all of its embarrassing nuttiness, so even in Republican debates the Affordable Care Act gets short shrift.  And does anyone really believe that, if Donald Trump somehow becomes the Republican nominee, he’ll work to understand the workings of this complex law, and be able to say anything other than that it is a “disaster” and he’ll “repeal and replace it with something much better”?

Should We Go To Organ Opt-Out?

There was an interesting piece on the CNN website today.  Written by a young woman whose health condition required her to receive a heart transplant, it argues that the United States should change its approach to organ donations, and go from a voluntary donation system to an opt-out system.

organ-donation-transplantationThat is, the United States would presume that all of its citizens have agreed to become organ donors unless and until they have “opted out.”  Some European countries, most recently Wales, have gone to an “opt-out” system, and the argument is that the system will allow the U.S. to avoid the many deaths — according to the writer of the CNN piece, 22 each day —  of Americans who are waiting for a life-saving organ transplant that simply doesn’t arrive in time.

I’m one of the 40 percent of Americans who have voluntarily become organ donors.  I figure that when I’m dead I won’t need my eyes, or organs, or anything else, and if somebody can get some additional use out of them, that would be great.  (Of course, I’m hoping that I’ll have gotten a lifetime’s worth of production out of them before that inescapable eventuality happens.)

Still, there’s something about an opt-out system that troubles me, ethically.  The CNN writer argues that such a program will heighten awareness of organ needs, and better match public opinion — where polls indicate that 95 percent of Americans favor organ donation — with the number of actual organ donors.  And, she contends that an opt-out approach is still voluntary, only the choice is to opt out, rather than opt in.

I disagree with that.  Unlike some, I don’t think an opt-out approach would turn doctors into ghouls who would fail to provide appropriate care in order to expedite harvesting valuable organs.  Instead, I think the issue boils down to one of very basic, essential choices.  If the United States went to an opt-out system, the government would presume to be deciding what to do with your organs, and the burden would be on you to take action to reverse the government’s decision.  I think deciding whether to contribute organs upon your death is about the most personal choice a human being can make.  The fact that the government thinks the greater good might support one choice rather than another doesn’t make the choice any less personal, or one that should be taken away from the individual, even if it is only until they state their intention to the contrary.

I hope that everyone decides to contribute their organs upon their death, so people like the young CNN contributor can live a long and healthy life — but I also think it is a decision that everyone has to make for himself.

Obamacare’s First Birthday

It’s hard to believe, but it was only a year ago on October 1 that Obamacare, through that ill-fated healthcare.gov website, was born.  Parents will tell you that a newborn’s first year passes by in a blur — and it has, hasn’t it?  It sure seems like more than a year ago that we were hearing about wait times and website crashes, but ISIS beheadings and Ebola outbreaks and other assorted disasters have a way of telescoping the passage of time.

So, how is Obamacare doing on its first birthday?  Not surprisingly, given the superheated controversy surrounding the Affordable Care Act, it kind of depends who you ask.

The New York Post has done a review and gives Obamacare an overall grade of “F,” because it has cost a lot of money, hasn’t really made a huge dent in the mass of uninsured people, has messed with a lot of people’s plans, and is affecting full-time job creation by businesses because of the costs it imposes.  The Department of Health and Human Services, on the other hand, has released a report that says Obamacare has produced a significant reduction in uncompensated costs that have to be borne by hospitals, presumably because there are fewer uninsured people who can’t pay their hospital bills.  Yahoo Finance, in a survey article, found that some people like it and some people hate it, depending on whether Obamacare has raised or reduced their costs, helped them get insurance that they couldn’t have received otherwise, or eliminated plans they liked.

And — some things never change — the healthcare.gov website is back in the news again, because it has a “critical vulnerability” in the security area.  Basically, it appears that the government entity that manages the website hasn’t been using the basic available tools to monitor security issues and test for website vulnerabilities.  It’s not clear whether any people who have used the website — and entered in lots of highly personal information in their quest for insurance — have experienced any identity theft or similar problems.

Regardless of your political affiliation or your view of Obamacare, there is one finding that pretty much everyone should be happy to celebrate on Obamacare’s birthday.   A Washington Post review of congressional floor speeches found that, this month, members of Congress mentioned “Obamacare” only 27 times.  That 1/100th of the number of mentions Obamacare received in October 2013.  Isn’t it nice to not hear politicians, Republican and Democrat alike, yammering about Obamacare, Obamacare, Obamacare?

Politically, does that mean Obamacare is no longer the hot topic it once was, or does it just mean that Obamacare has been knocked off the front pages by other problems and issues?  Beats me, but my gut instinct is that the Republicans are wise to not beat the Obamacare drum incessantly.  People who hate Obamacare or feel they were screwed by it don’t need to be reminded over and over.  Focusing on ISIS, terrorism, the border, and other non-Obamacare topics make the Republicans seem like less of a one-trick pony.

The Obamacare Deadline Arrives

Today is March 31. It’s the “Obamacare” deadline that we’ve been hearing about for months, the end of the open enrollment period on the health care exchanges — although the federal government has extended the deadline for a week, to allow people who claim to be in the midst of applying to complete the process.

How is the process going? We know for sure that a lot of money and effort has been spent in encouraging people to apply by the deadline. The federal government has spent millions on TV ads and social media banners, alerting people to the deadline and encouraging people to “get covered.” President Obama himself has led the charge. Over the past few weeks, you couldn’t go to a website or social media outlet without seeing an ad. It’s been, by far, the largest, most visible, and probably most expensive government-sponsored ad campaign in my lifetime. It’s blown the “click it or ticket” and anti-drunk driving campaigns out of the water.

Has the ad campaign worked? According to information provided by the government, enrollments surged as the deadline neared. By mid-March, the government reported that 5 million had enrolled, then 6 million a few days ago. Some people hold out hope that enrollments might hit 7 million. The 7 million figure has some significance, because the Congressional Budget Office initially forecast that 7 million enrollments were needed during the open enrollment period, although the CBO later revised that forecast to 6 million.

It’s not entirely clear what these numbers represent. There are supposed to be 48 million residents in the United States who do not have health insurance; 7 million is only a small fraction of the uninsured whole. What do we do about the remaining millions of uninsured people? Moreover, it’s not clear how many of the people who have enrolled through the exchanges were formerly uninsured, either. Many of the users of the health exchange websites apparently were people who were insured but whose policies were terminated because they lacked mandatory provisions required by the Affordable Care Act. There are also valid questions about how many of the enrollees have actually paid premiums and therefore have coverage.

There will be a lot of information coming our way over the next few days and weeks about Obamacare. The Affordable Care Act is such a hot-button issue — and the impending elections in November will keep it so — that supporters and opponents of the law are sure to massage and select the data to favor their positions. The average voter would do well to apply skepticism to the messaging from both sides of the Obamacare debate.

If you’re someone who bought a new policy through healthcare.gov, the ultimate question about your fellow enrollees is: who are these people, and how sick are they? Insurance fundamentally involves a pooling of risk, and the cost of health insurance is directly tied to who else is in your pool. If you’re in a group with lots of young, healthy people who don’t need much health care, your premiums will be lower than if you’re in a group with a preponderance of sick people who regularly need expensive medical attention. We won’t know the true actuarial makeup of the new plans until the people who are covered begin to make claims, the claims get processed and paid, and the insurance companies look at the results and decide whether the pricing of the plans needs to be adjusted — and if so by how much. If health care costs increase dramatically, few people are going to consider Obamacare a success no matter how many people have enrolled.

It will be nice to see some new ads once the March 31 deadline passes, but everyone needs to take a deep breath. This initial deadline is just one step in a very long process, and we won’t know the outcome until we are much farther down the road.

The Value Of A Good Nurse

Today’s outpatient procedure at the East Side Surgical Center demonstrated the value of a good nurse — and how essential they are in the modern world of healthcare.

From the outset, after I completed the registration materials, I was in the realm of nurses. Pre-operation, a friendly nurse adjusted my crutches to the right height, got me changed into surgical garb, took my vitals, created my ID bracelets, gave me my initial medication, and set up the blood vessel portal for the anesthetic to be administered, among other tasks that I wasn’t even aware of thanks to our relaxed conversation. She was a real pro.

After the surgery, I awoke to the company of another nurse who checked the dressing on my foot, explained that the operation had gone well, took my blood pressure, gently engaged me in a slow-talking conversation as the anesthetic fog gradually lifted, steadied me on my crutches, then wheeled me out to where Kish was waiting for me with the car. She was great, too.

In our penny-pinching health care system, doctors have to focus on doing the high-level procedures for which they are so well trained, and nurses carry the load of performing the other medical, and administrative, and human interaction duties that need to be completed. We can only keep costs under control — and also create an experience where the patients truly feel like they are receiving care — if we have a corps of kind, pleasant, professional nurses who make the system run.

I’m happy to report that I received excellent nursing care from some wonderful people at the East Side Surgical Center on my visit this morning. Of course, the best care of all is at home, where Kish is saddled with keeping an eye on me while I’m flat on my back for a few days.