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Started 12 years ago by rrteyre341

rrteyre341
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<div class="entrytext">According to a process laid out in the Budget Act of 1974, the budget resolutions put forth by the House of Representatives and the Senate emerge as modifications, sometimes substantial, of the budget to be submitted by the first Monday in February by the President of the United States.Alas, for governance, the President has missed that deadline for fiscal 2014 (starting in October 1, 2013). He is likely to submit a budget only by early April – two months late. In the meantime, both chambers have worked up their own budget resolutions, without the President’s budget as a starting point. It shows, because the tax- and spending numbers in these two budgets, and the visions for America they reflect, differ so starkly that it is hard to imagine the emergence of a joint conference report reconciling the two budgets in one that could pass both chambers.But all is not lost. At least the American people now have before them the visions the two parties have for our country, especially in regard to health policy.IMPACT ON HEALTH CARESenate Budget: The Senate budget basically preserves the status quo in health care under current law.Not surprisingly, it leaves in place all of the provisions of the Affordable Care Act (ACA) of 2010, save for a proposed additional cut of $275 from Medicare and Medicaid over the next 10 years. Part of those savings may be used to cover an additional outlay of $138 billion over the next ten years to keep Medicare fees paid physicians at current levels. Under current law, these fees are slated for an implausible 26.5% cut under the Sustainable Growth Rate (SGR) formula enacted in 1997.House Budget: The House budget proposes to repeal the entire Affordable Care Act, save for retaining the roughly $700 billion of cuts off projected Medicare spending that the ACA called for to help finance the expansion of health insurance coverage for Americans under age 65. The House budget would also retain some added taxes included in the ACA, which also are intended to finance the insurance expansion under the ACA. These Medicare savings and added taxes, however, are to be diverted under the House budget into deficit reductions rather than to finance the expansion of health insurance coverage provided under the ACA.The House budget resolution does not propose an alternative program to expand health insurance coverage among Americans under age 65, as a replacement for the repealed ACA. Gone therefore would be the roughly $1.8 trillion of federal spending the ACA would have channeled into expanding Medicaid coverage for adults with incomes up to 138 percent of the federal poverty level (FPL), along with the substantial federal subsidies the ACA provides toward the purchase of private health insurance for Americans with incomes between 138 percent and 400 percent of the FPL.The House budget also would convert the traditional, already existing Medicaid program into annual block grants from the federal government to the states, cutting the budget for traditional Medicaid and some other health programs by $756 billion over the next 10 years, relative to the baseline projection. Hitherto the costs of the existing Medicaid program have been shared by the federal and state governments under the Federal Medical Assistance Percentages (FMAP) program, with the federal share varying inversely with per-capita income Henceforth, the federal government would leave it to the states to decide how to spend that fixed sum of federal money on their poor citizens,Moncler Sito Ufficiale, including who is and is not eligible for financial assistance from the state.Finally, on top of retaining the $700 billion or so cut in projected Medicare spending called for in the ACA, the House budget would eliminate for 2014-2023 an additional $129 billion of Medicare spending that the ACA had allocated to improved benefits under Medicare for preventive care and closing the donut hole in the prescription drug program (Part D).In sum, relative to current law, the House budget would reduce the federal flow of funds into health care by about $2.6 trillion over the next 10 years. It would clearly impact the millions of low-income Americans who would have gained health insurance coverage under the ACA and also Medicare beneficiaries who would not receive the improved benefits provided in the ACA.Relative to the baseline, the providers of health care and private health insurers who book health spending as revenue would take a noticeable financial hit from the House budget. Although some of the federal funds not flowing into health care might be replaced by funds from private households, it is reasonable to assume that on net the providers of health care and health insurers would receive trillions of dollars less revenue under the House Budget, relative to the baseline. Thus, it would be surprising if Wall Street scored implementation of the House budget as positive for health care stocks overall.The House budget additionally proposes to convert Medicare from a defined-benefit to a defined-contribution program, of which more will be said further on.WHAT KIND OF AMERICA?Budget resolutions can be viewed as memoranda in which legislators reveal – even if not fully straightforwardly –the trade-offs among competing interests they are prepared to make to realize their preferred vision for the nation’s future. These trade-offs involve redistributions of economic privilege among citizens, and many of them involve profound moral choices.Two major questions have always hovered over this process, to wit:<ol start="1">It may be argued that, at this time, as the nation’s federal debt keeps growing apace, the overarching issue is not either of these two questions at all, but merely how to constrain the federal deficit and the federal debt to manageable levels.It is my sense, however, that neither side in the debate is actually much concerned with that issue, even though they pay lip service to it. The House budget, for example, proposes a major reduction in the marginal income tax rates faced by individuals and corporations without specifying which tax expenditures (tax loopholes) would be eliminated to keep the rate-reduction budget neutral. That is not serious budgeting, nor does it show serious concern over the deficit.After all, we have been the route of large tax-rate cuts before, only to see budget deficits and the public debt balloon twice in their wake: once in the 1980s under presidents Ronald Reagan and George Herbert Walker Bush, and again in 2001-8 under President George W. Bush. The experience of those years suggests that, after the dust had settled and the lobbyists had done their work, the tax-rate cuts proposed in the House budget would be most likely to repeat the spectacle of ballooning deficits and public debt.WHAT DOES IT MEAN TO BE AN AMERICAN,Moncler Uomo 2013?In principle, every American has dual citizenship. One is citizenship in the United States, as an American. The other is citizenship in the state in which he or she resides, as, say, a Texan or Californian.The question is which of these two citizenships should be emphasized in crafting federal health policy. Is someone living in Texas, for example, a Texan first and an American second, or is it the other way around?Although in reality it is not as simple as that and the relative weight people attach to each citizenship is apt to vary along a continuum and also by issue, the more extreme dichotomy may helpful in understanding the stark difference between the House and Senate budgets.Democrats: In their policies, Democrats seem to accord supremacy to American citizenship. They rather consistently lean toward the view that, beyond the limited set of rights guaranteed all Americans in the Constitution, all Americans, in whatever state they live, should have access on roughly equal terms to at least to three important human services: justice, education and health care.That vision of citizenship expresses itself in the many federal benefits Democrats seek to bestow on individuals and institutions as, for example, in the Affordable Care Act (ACA) of 2010. It also finds expression in the many federal mandates Democrats are prepared to impose on individuals and institutions, wherever they may be located.A very clear expression of that vision, for example, is the provision in the ACA that every American adult in families with incomes up to 138 percent of the federal poverty level will be eligible for Medicaid coverage, wherever in the U.S. they may reside.The federal mandate on individuals to acquire health insurance is another expression of that view.Republicans: Republicans, on the other hand, seem to give more weight to state citizenship in their policy prescriptions for health care.That view expresses itself in the fiercely defended idea of states rights and insistence on strict constitutional limits on federal policy – e.g., objections to the federal mandate on individuals to acquire minimally adequate health insurance.That view also is echoed in the much-mouthed slogan that “one size does not fit all” whenever health policy is discussed. I find it a peculiar slogan in a nation whose great global businesses – McDonalds, the Holiday Inn chain, Burger King, name-brand department stores, and so on – have made the idea that “one size fit all” the very foundation of their business models. It is not self evident on technical grounds why appropriate styles of medical practice in response to given human ailments – e.g., cancer — should vary by state, or even why health insurance coverage or health insurance exchanges should differ among states. But the slogan of “one size does not fit all” plays a major role in U.S. health policy.The idea of state citizenship first and U.S. citizenship second in health policy naturally rejects as arrogant the many powers assumed by the federal government in the ACA. It can explain why the Republican budget resolution calls for its complete repeal although, in the past, during the 1990s, with a similar intrusion into state affairs.An emphasis on the supremacy of state citizenship in matters of health care also explains why the Republican budget resolution proposes to convert the traditional Medicaid program into a block grant program, leaving it to the states to decide how to spend that fixed sum of federal money. Under block grants, similarly situated Americans – even children – will not have access to health care on roughly the same terms all across the land. How they fare in health care will depend on their state citizenship, not their American citizenship.TO SHARE OR NOT TO SHARE RISKS AND HARDSHIPIn the paradigm used by economists, goods and services are produced in an economy by human and non-human capital. We call the input-services provided by human capital “labor” and the return to that capital “wages and salaries.” The returns to non-human capital, accruing to those who own legal title to that capital, are called “rent, interest, and profits.”The return to both forms of capital consists of future cash flows whose magnitudes over time are uncertain and thus carry risk for those who own the capital.Some of those risks are triggered by the behavior of those who own the capital. Others originate in factors beyond the individual’s control – e.g., the obsolescence of a skill by a disruptive innovation or the loss of a job as a result of sometimes destructive economic pollution emitted by the behavior of decision makers in the banking industry.The question any society organized as a nation faces is to what extent the risk inherent in this uncertainty should be shared and born collectively through different forms of social insurance, and which risks should be borne by the individual.A related question is how any form of social insurance in this context can be structured so as to minimize the moral hazard inherent in insurance, that is, behavior by individuals that increases the financial burden on the social insurance mechanism. Specifically, the question is whether society at large should compensate individuals for imprudent behavior.It is natural to think that social-insurance schemes solely protect the owners of human capital from the vagaries of life, an idea often decried in these latitudes as the markings of a “welfare state.” In a book entitled When All Else Fails: Government as the Ultimate Risk Manager,” however, David A. Moss of the Harvard Business School notes that the first application of social insurance actually was designed to protect corporate capitalism.Social insurance here takes the form of the hallowed principle of limited liability, which is the sine qua non of modern, corporate capitalism. The principle limits the liability that shareholders bear for any damage their corporation may inflict on society to the contribution that these shareholders have made to the corporation in the form of equity infusions. The rest of the risk is borne, first, by the corporation’s creditors, who may not get paid, and then by society at large. If pollution by a corporation made an entire city uninhabitable, for example, society at large would bear most of the risk.In some instances, of course, the owners of non-human capital are bailed out or receive assistance from government even beyond the requirement of the principle of limited liability, either through direct bailouts, as in the banking sector, or through tax preferences or subsidies.The two budgets now before the American people offer sharply different visions on the role of social insurance in society. While the Democratic Senate budget would preserve the current system, including the expansion of the system through the ACA, the Republican House budget offers a radical departure from that system by shrinking it.First, the House proposal to repeal the ACA signals to millions of low-income Americans without health insurance that they are on their own in health care as far as their status as American citizens goes, although their other citizenship, in their state, may help provide them with government assistance.Second, the conversion of the federal Medicare program for the elderly from its traditional form as a defined benefit program into a defined contribution program for Americans now below age 55 would provide the perfect platform for shifting more and more of the risk of rising health care cost from collective risk sharing to individuals, who are told that they are on their own for the rest.In my view, this risk shifting by itself is not a reason to dismiss the idea of defined contribution out of hand, as some commentators on the left of the ideological spectrum now do. One could structure such a program in a way that would find acceptance by most Americans. The devil here really is in the details — specifically,Moncler Outlet, the size of the federal contribution relative to the total per-capita cost of health care for the elderly at any point in time and over time. To limit the annual growth of the contribution to a formula such as GDP growth plus 50 basis points, as the House budget envisages, may be no more workable than was the completely unworkable SGR formula legislated as part of the Balanced Budget Act of 1997.The line between collective- and individual risk bearing is not something dictated in a holy book. It is a line that every generation must reexamine and redraw or reaffirm, after open debate. Ideally, that debate should be conducted in a civilized tone, with mutual respect, and without the demagoguery that now marks our debates on public policy. One can only hope that our children will do better in this respect. This entry was posted on Thursday, March 21st, 2013 at 7:53 amand is filed under , , , , , , , , , , .You can follow any responses to this entry through the feed. You can , or from your own site.</div>

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