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ObamaCare: Victim of HMO Fraud

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Obamacare: Victim of HMO Fraud

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Solving the Healthcare Crisis: Lifestyle Insurance

‘…if HMOs are so confident of their service, we welcome them to remove all legal exemption – retroactively. Then we can talk of ‘free-markets’ and the better service they offer.’

Summary

We target HMO's as the primary cause behind the spike of USA healthcare cost over those of other developed nations. HMOs cost us about double for as much as half the service of other countries. This disparity began in the 80’s with HMO’s takeover of our healthcare. Obamacare removes this HMO market corruption thereby leading to the kinds of cost savings and service upgrades we see of other countries.

HOWEVER, there will be an initial price spike during a transition period. It will include some service laps against the HMO’s pre-catastrophic healthcare infrastructure. HMOs had 40 years to build one. Obamacare will need a transition time as well.

HMO fraud is gained by sidestepping much of the catastrophic cost associated with ‘true’ insurance. Obamacare tackles this area of the healthcare crisis. This presented a simple solution: attach Obamacare to HMO plans for the best of both. We could have tapped into HMO’s strong suit: low-cost, decent sized networks of pre-catastrophic care. Obamacare would have taken care of the other side of the equation: catastrophic costs. Combined, we could have had the best of both.

It’s too late for this now. Obamacare has replaced HMOs – hence the 5 million canceled ‘healthcare’ policies. The remedy would be the reverse. Re-assign HMO’s to make-up for Obamacare shortfalls. Is this a marriage ‘made in heaven?’

The initial ‘sticker-shock’ leaves Obamacare looking dreadfully expensive. The lack of infrastructure adds to this PR disaster. This is a replay of HMOs takeover of our healthcare 40 years ago. Behold: Low prices for phantom insurance. It’s a fraud. Fraud at first looks great, but it’s far more expensive as we see from our comparables to other countries.

HMOs exist upon a single corruption: legal exemption. Without it, they would go broke - overnight. Removing this would have been the easiest way to kill the beast. HMO’s faced with legal accountability would expose the sheer scope of fraud. It would also run hundreds of billions.

Obamacare took the opposite approach. It raised standards instead. Obamacare resets a new minimum baseline of services while breaking-up catastrophic cost. That cost is no longer a single bill you get on the back-end as HMOs do. Obamacare parcels out this bill over 30 year increments of monthly premiums. This is the accurate story behind ‘sticker-shock.’ Obamacare re-introduces ‘real’ insurance coverage. Expensive indeed.

Layered between this narrative is the story of the Republican conquest of the Democratic Presidency. Obamacare is another version of the Republican 'Exchange Programs' taken from the 80's. It’s often referred to as ‘block grants.’ This Exchange Model is the Conservatives center piece for most all gov't service programs: School Vouchers, Social Security Vouchers, Healthcare Vouchers, Welfare Vouchers, etc.

The Republican attack upon Obamacare is unwittingly staging the arguments against all such Exchange programs. Republicans are laying the framework to why their policy template of the last 30 years doesn't really work. Their reasons are as true for Obamacare as they would be for any other Exchange Program.

Obamacare is likely to help reset healthcare in line to other developed countries. We may now reduce cost 40% while doubling service. However, even if possible, these countries are also running up against a premium ceiling. It’s becoming too expensive for both tax payers and patients in those countries as well.

We conclude that Obamacare may be an improvement over HMO's, but it is still too expensive for growing millions of Americans. Republicans are right about this just as they are correct that their ‘Exchange’ program won’t work either.

Simply stated, neither Democrat nor Republican have an answer to this healthcare crisis.

Despair not. We present a rather simple solution: Lifestyle based insurance. We call it ROOPA: Responsibility for One's Own Products & Actions. Welcome to Lifestyle Budgeting. Presented by Raghu-nomics.

*.*.*

Caption Summaries:

HMO’s fall short of a ‘real’ insurance policy, but they might well make a great supplement to it. Ironically, this maybe more true with Obamacare. HMO’s may be the perfect supplement to the lower end of Obamacare plans.

*.*.*

… Going after HMO’s would have blunted much of the Republican allegations against Obamacare. Teaming up with insurance would have made a strong case for an industry partnership against HMO corruption. Instead, Pres. Obama ended with the perfect storm squeezed by liberal demand, insurance companies and conservative defenders of free markets. This all happened because Obama failed to differentiate between insurance and HMOs.

*.*.*

… Obamacare is the official Republican response to healthcare. There is no back-up plan. It is the ‘counter offer.’ Now the scary part: Obamacare is the Republican’s one and only response - to everything:

  • School Vouchers (Public Exchange),
  • Social Security Vouchers (Public Exchange),
  • Medicare and Medical Vouchers (Public Exchange),
  • VA Vouchers and yes, the
  • Healthcare exchange too.

…It’s more than an ideological refrain. It’s their only public policy template of the last 40 years. It’s the fourth leg to: -- no taxes,

-- de-regulation and

-- overturning worker protections.

-- Exchange Boards

…Obamacare adds the fourth leg to this Conservative platform. Pres. Obama is the true standard-bearer of the Reagan legacy. Actually, he tops it. Pres. Obama has a larger military budget, offers lower taxes and implemented greater de-regulation then Reagan ever could. And wages are lower too. Much lower. Obamacare adds the final piece of the puzzle. The old Republican agenda of the 1980’s now stands complete.

…Obamacare maybe the final victory for Republicans, but their drive against it holds the greatest undoing for it. The Conservatives cure-all policy of the last 40 years is now being dismantled by Republicans. ..

*.*.*.*.*

…. HMO’s legal exemption creates a massive market distortion in a way few criminal enterprises ever could.

Net liabilities:

  • Prices jumped 80% over the last decade. They will do so once more, but at a much faster past and with a steeper rise this time.
  • Their rising premiums left nearly 50 million American’s without any healthcare. (Yes, 10 times as many people lost their health care under HMOs then Obamacare. And that’s just the beginning.)
  • This lost healthcare s is alongside a rising tide of 1.5 million people losing coverage each year. This has been growing over the decade with projections expected to hit 2 million a year. Democrat reactions are much the same we now see of Republicans to Obamacare cancelations. The difference of course is that we have no upgrades with HMO cancelations. Republicans are getting a lot more political mileage then Democrats though HMOs have 90% more cancelations. Republicans just have better messaging then Democrats.
  • …US healthcare is notorious for being twice the cost for half the service. …. here’s the most telling fact. America’s premiums started that sudden climb back in the 1980s. Before then, our medical costs were on par with the rest of the developed world. Today, we are about double of those other countries. The 1980’s mark the HMO takeover of our health care.
  • HMO’s doubled our cost for ‘half the service.’ In other words, HMO’s are a dreadfully, inefficient service model. Dumping HMOs would realign cost and service efficiencies closer to those of other nations - 40% savings for double the service.

*.*.*.*.*

Trashing this legal exemption would have been the easiest way to break HMO’s market distortion. To begin, it would expose the scope of horror of HMO abuse. It would introduce billions more in costs and reset HMO’s into a true ‘free-market system,’ Those competing within the legal limits of true ‘health insurance’ would survive against those who have succeeded by breaking them.

Not surprisingly, we would end up with much the same ‘sticker-shock’ and service up-grades now being implemented by Obamacare. Such lawsuits would leave HMOs canceling ‘old’ policies much as they are today. Conservatives could now blame the law of the land rather than socialism.

In short, Obamacare is the de-criminalizing of healthcare of HMO fraud. Legal recourse would have been much more abrasive. Obamacare happens to be far more industry-friendly.

Here’s our challenge: if HMOs are so confident of their service, we welcome them to remove all legal exemption – retroactively. Then we can talk of ‘free-markets’ and the better service they offer. Only then, can we truly compare their service against Obamacare.

*.*.*.*

… Raghu-nomics introduces a new approach that can solve these problems. It incorporates the best of both while leaving aside all the liabilities of each.

It starts from a simple premise: Life style.

50% of all medical cost is lifestyle related.

The solution: cover the social cost of your own lifestyle.

In turn, costs drop by this same 50%.

Life style has a corresponding social cost. Social cost provides the most ‘scientific’ policy template. It presents this accurate baseline for identifying cost, finding the best venue to savings and highlights service remedies.

This lifestyle approach offers all the healthcare services demanded by Democrats. It covers the cost savings business needs and that workers want. Republicans will love it too. It incorporates personal responsibility while also providing a ‘free-market’ solution.

*.*.*.*.*.*.*.*

*.*.*.*.*.*.*.*

Welcome to HMO Fraudcare.

HMO’s low priced premiums give the appearance that Obamacare is expensive. The price comparison is based upon a half century of HMO deception.

HMO’s appear to offer ‘affordable healthcare plans’ but often, they are more façade fronting as insurance companies.

  • They shape-shift when called upon for medical treatment.
  • Their sliding scale can change with each submission.
  • They abruptly terminate with shifting criteria for ‘conditions’– pre-existing or otherwise.
  • You’re fine until you need them. Then, HMO’s become all manner of Sarah Palin’s ‘death panels.’
  • HMO’s are Russian roulette of insurance. Click the wrong chamber: BAM!!!. YOUR DEAD.
  • If lucky, they bill you instead. They demand hundreds of thousands of dollars. There goes all that is dear: home and credit, decades of savings and your life of dignity.

The options are pretty simple: pay with your life or hand over all financial security of your loved ones. Sounds like a mob. For many, it feels about the same. No less crushing, if not more so.

This allows HMO’s to look affordable while still handing over the highest profit margins of most any industry. The magic is in their service formula. The secret formula happens to look a lot like old-fashion bate and switch.

They bate ‘members’ with low premiums and then abruptly drop coverage once customers ‘really need them.’ No high-tech algorithms here.

Don’t blame CEO’s as such. The problem actually lies with the business model itself. HMO’s won’t cover catastrophic costs. Denied payment is the centerpiece of their business model. Simply stated: HMO’s are the opposite of insurance.

Insurance: Catastrophic Costs

Insurance is founded upon one simple concept: covering ‘catastrophic’ costs. Insurance is geared to cover that one catastrophic bill in death, sickness, accidents, fire, flood and every other policy. That’s insurance.

Insurance works upon the principle of aggregate cost. A small number use the service while the majority pay into the pot. Routine expenses like check-ups and tests will cost much the same as your insurance premium. As such, the real (if only) value starts when faced with catastrophic costs.

HMO’s are the opposite. The HMO model withdraws your coverage as death and emergency are upon you. You’re dropped as they hand you that crushing medical bill. Here’s the magic formula behind their ‘low costs’ premiums. Talk of free markets and choice is all part of the grand hoax.

Often, this is done randomly. HMO contracts are the ‘devil in the details.’ Other times, they will write-in the ‘terms’ called ‘partial service’ or partial coverage.

This ‘service’ agreement list all the ways they won’t cover your catastrophic bill. These ‘agreements’ outline how they are more phantom insurance then healthcare.

Those policies are showing up today. They are the 5 million ‘health plans’ canceled in response to Obamacare. The phantom dies - only to be resurrected by public demand. Such is a lie well told. Obamacare is left looking expensive: the victim of HMO Fraudcare.

HMO vs Insurance = HMOsurance

This is not the first time. HMO’s did the same to our healthcare industry some 40 years ago. The public complained of high prices. HMO’s gave them ‘lower’ prices. The price they pay: phantom insurance. They cover some medical costs, but drop the real insurance policy.

Insurance can’t compete with HMO pricing. Result: HMO’s replaced them. Falling service and reduced coverage grows each year as this HMO system continues to devour real healthcare coverage.

History repeats itself today. Customers are demanding their old ‘policies’ back. They want them in place of Obamacare’s higher priced premiums. The public lynching of Obamacare maybe preferred to the slow tortured death we saw of ‘real’ insurance companies.

Some insurance companies did ‘adapt.’ They cover much of the cost and then use HMO service cuts for the largest bills. It’s a new hybrid: part insurance, part HMO. Should we call it HMOsurance? (Silent H) Whatever the case, it’s gearing into the industry norm. Kaiser Permanente may be an example of this. How else to compete against HMOs?

This seems to have settled much of the immediate backlash. The public outrage of 5 years ago has now settled into a quieter lull. With this has gone the urgency driving Obama’s original push for health care reform. The great cause now losing to poor timing.

On the other side is business. Business loves it. HMO’s have the appearance of employee benefits, but at ‘half’ the cost. Workers do get denied but generally, it’s only after they are no longer employable. No loss to business there.

The little guy gets the package of fraud – fraud-care. The ‘real’ insurance is saved for the rich. The final class divide – HMO vs. health insurance.

The model works great for the rich, corporations and investors, but the remains stand as a death sentence for millions of Americans. Forget death panels, its death-camps you may have to worry about! Today’s internments are now built upon policy contracts that leave millions huddled into cells of service confinement ending with certain and tortured death.

HMO Death Camps does make great headlines, but is it hyperbole? Maybe. But insurance? HMO’s are not.

HMO: Perfect Supplement to Obamacare?

A more balance approach could say HMO’s have some strong positives. One is the success HMO’s have in reducing inflated billing. Routine check-ups and some higher end costs have been cut dramatically. They could drop that $120 Lipator drug prescription to something like a low $22 price. They seem to have cut coast in a way more acceptable to healthcare providers. Medi-Cal patients for example are being dropped by doctors at a much higher rate than they do HMOs. This side of HMO ‘service’ offers a valuable function. However, that does not make them an insurance company. This makes them more a coupon book of great discounts.

Imagine if

  • a bike advertised as a car
  • a legal secretary offered to be an attorney or
  • a pawn shop claimed itself a bank for loans against collateral.

Each of them covers a small function of the respective institution, but they don’t get to change their title along with it. They are not a car, attorney or bank. HMO’s have the same mix-and-match ‘specials.’ They do cover most things, BUT, they don’t cover that ‘true’ function of insurance - catastrophic costs. Therefore, they are not an insurance company and so they don’t really offer ‘health insurance.’

Calling them a fraud and murders can feel great and may have some justification, but the problem might be more simple: labeling. HMO’s have been miscast as insurance rather then as a great little (big) discount service.

HMOs fall short of a ‘real’ insurance policy, but they might make a great supplement to it. Ironically, this maybe more true with Obamacare. HMO’s may be the perfect supplement to Obamacare plans. (The first draft of this was written just as Obamacare was being released and before the policy cancelations.)

Obamacare has taken on to cover all the catastrophic billing missed by HMOs. Under Obamacare, customers cover the smaller, routine ‘co-pays’ - $6,000 (individual) to $12,000 (family). (Prices vary by state.) This area of service is the very one HMO’s happen to specialize in. Could HMOs prove more cost effective at closing this ‘donut hole’ then Obamacare?

HMO’s already have all the contracts in place for such savings. Some HMO plans include a wider network of doctors and other service that outclass Obamacare. This seems more a regional issue or market segment rather than a national trend. An example could be those shifted over into Medi-Cal vs. those with a ‘true’ healthcare insurance plan, etc. I wonder if Medi-Cal is in fact a big step down from HMOs? If so, it would be the worst of both wherein you are now paying more for less service. Republicans may have a point when it comes to Medi-cal vs HMO. Need more review to see.

Here is where we could have found a simple solution. Use Obamacare as the add-on to these HMO plans with their good, up-front service program. This would have seemed the natural response prior to those 5 million customers now losing their HMO plans. This approach would have given us the best of both: insurance coverage atop HMO pricing and preventative services. It would have also offered a smoother transition.

Republicans suggested something similar (after the fact): add a supplemental service for catastrophic coverage for HMO plans. It was a valid proposal that offered much of the big ticket cost demanded by Obamacare. Such constructive contributions are lost in today’s climate of confrontation.

Amusingly, this Republican proposal validated Obamacare. Missed by the media pundits was the fact that we now had both parties on the same page; talking about the same solution; to the very same problem.

Obamacare is the cure to HMOs non-catastrophic coverage, but no less amusing is that HMO’s may now be the cure to Obamacare. Would this be the marriage made in healthcare heaven?

Political soap opera at its best. Oh, the ironies of politics and the grand beauty of American Democracy at work. We fail to give it its fair due. It’s found in recognizing the negatives of each and pairing them to the positives of the other. Welcome to Raghu-nomics.

Such a pairing would be like that legal secretary as a compliment to the attorney’s service. She can help with a lot of the pre-trial paper work, but only the attorney can represent you in court. Only the insurance company covers that catastrophic bill. Or, it’s like the bike to cover some rides and tapping that pawn shop for petty cash between bank loans. Each is a valid and helpful service, but only if confined to their specific role. Once they pretend to be something more, it’s a fraud. That’s been at the heart of the problem with HMO’s. And it’s ugly one.

HMOs: Above the Law

Any other industry would be charged with fraud for what HMO’s do. Even banks are finally getting hit with indictments. Not HMO’s. They get a free pass. There is no legal recourse to HMO scams. You can’t sue them for breach of contract, negligence or even fraud. There are a few occasions where a medical decision was overturned. Rarely is there a fine or penalty. They are ‘above the law.’

Put another way, HMO’s would go bankrupt if held to full legal account. Today’s HMO model works only as a legal exemption. If they could be sued, they would go broke - overnight.

Placing HMO’s just beyond legal jurisdiction recreates all the liabilities of any criminal organization: death, shake-downs, decimated communities and families destroyed. And yet, those concerns miss a broader and more telling issue. HMO’s legal exemption creates a massive market distortion in a way few criminal enterprises ever could.

Net liabilities:

  • Prices jumped 80% over the last decade. They will do so once more, but at a much faster past and with a steeper rise this time.
  • Their rising premiums left nearly 50 million American’s without any healthcare. (Yes, 10 times as many people lost their health care under HMOs then Obamacare. And that’s just the beginning.)
  • This lost healthcare s is alongside a rising tide of 1.5 million people losing coverage each year. This has been growing over the decade with projections expected to hit 2 million a year. Democrat reactions are much the same we now see of Republicans to Obamacare cancelations. The difference of course is we have no upgrades with HMO cancelations. Republicans are getting a lot more political mileage then Democrats though HMOs have 90% more cancelations. Republicans just have better messaging then Democrats.
  • Low grade service packaged as ‘partial coverage’ for another 20 to 100 million American’s. (Numbers vary upon critic: Example: presently 100 million with ‘pre-existing conditions.’ Which of them could be denied service?) This is ‘the candle burning at both ends’ wherein service cuts are matched with rising prices.
  • Medical bills are behind two thirds of all bankruptcies. This trend held steady since HMO’s became the dominant player four decades ago. There was a big jump in the last 5 years. The whole purpose of insurance is to save you from such bankruptcy. HMOs instead became the source of them.
  • US healthcare is notorious for being twice the cost for half the service. Perception or exaggeration? Maybe, but here’s the most telling fact. America’s premiums started that sudden climb back in the 1980s. Before then, our medical costs were on par with the rest of the developed world. Today, we are about double of those other countries. The 1980’s mark the HMO takeover of our health care.
  • HMO’s doubled our cost for ‘half the service.’ In other words, HMO’s are a dreadfully, inefficient service model. Dumping HMOs would once again realign cost and service efficiencies closer to those of other nations - 40% savings for double the service.

HMOs are ground zero of America’s healthcare collapse. This price disparity from those of other countries pinpoints just how severe this corruption has gone in distorting markets and decimating our nation’s healthcare performance. We present you HMOs; the culprit to America’s healthcare crisis.

Lawsuits vs. Obamacare

This HMO corruption was possible for one reason and one reason only: legal exemption. HMOs operate above the law and so are immune to natural social and commercial market forces that would have removed such inefficiencies.

We don’t talk of the injustice of all this, but rather we point to the ever growing economic distortion it creates. Because it operates outside the law, its harm is much greater then what we will see of gov’t run services. Though gov’t may be less efficient, they still operate within some confines of law and order. This forces some degree of market pressures over a criminal institution with no such legal obligation.

Trashing this legal exemption would have been the easiest way to break this HMO market distortion. To begin, it would expose the scope of horror of HMO abuse. It would introduce billions more in costs and reset HMO’s into a true ‘free-market system,’ Those competing within the legal limits of true ‘health insurance’ would survive against those who have succeeded by breaking them.

Not surprisingly, we would end up with much the same ‘sticker-shock’ and service up-grades now being implemented by Obamacare. Such lawsuits would leave HMOs canceling ‘old’ policies much as they are today. Conservatives could now blame the law of the land rather than socialism.

In short, Obamacare is the de-criminalizing of healthcare of HMO fraud. Legal recourse would have been much more abrasive. Law suits would have given the public a sense they had finally won some small justice upon today’s financial overlords. Obamacare happens to be far more industry-friendly then all this.

Our challenge: if HMOs are so confident of their service, we welcome them to remove all legal exemption – retroactively. Then we can talk of ‘free-markets’ and the better service they offer. Only then can we truly compare their service against Obamacare.

Failure of Context

These liabilities combined into growing outrage against HMOs. That was the public impulse driving this healthcare reform. This was in full swing when Obama first started his presidential campaign. This was the ‘public’ mandate he rode upon in his call for healthcare reform.

A funny thing happened with his election win. His success was co-opted by ‘liberal agenda’ rather then Conservative critics. Democrats pushed for universal healthcare instead of HMO reform.

‘Conservatives responded in kind. They stood to fight against this ‘socialist take-over.’ Ideological conflict buried a good cause. Insurance-care versus HMO Fraudcare never found its public voice.

This misstep was sealed once Pres Obama publicly went after insurance companies. He targeted them rather than HMO’s. Insurance and the President shared a common cause against HMOs. The insurance industry happened to be one of the Presidents early endorsers. He ostracized his best ally while blurring the true context for his reforms.

Going after HMO’s would have blunted much of the Republican allegations against Obamacare. Teaming up with insurance would have made the case for an industry partnership against HMO corruption. Instead, Pres. Obama ended with the perfect storm squeezed by liberal demand, insurance companies and conservative defenders of free markets. All this happened for one reason: Obama failed to differentiate between HMO’s and insurance.

Pres. Obama’s oversight personifies the real problem behind much of our healthcare reforms. We failed to see HMO’s role to America’s decline in healthcare service. HMO’s are ground zero to this skewed pricing distortion in our performance as measured by the rest of the world’s healthcare cost.

How the country’s smartest missed this obvious rogue is startling. So much rides upon it. Everything from insurance companies to the Presidents legacy; all tied to this single issue and yet, none identified HMO’s role as the primary culprit to this entire mess. Our specialty at Raghu-nomics is catching those ‘big things’ that everyone else somehow misses. Lol.

And so here we are today. Without HMOs, Obamacare has little context. It comes off as some big price hike. It feels intrusive. And worst, Fraudcare looks much more affordable as well as more user friendly. They have decades of infrastructure built upon towards preventative care and clinical services. Hence the public outcry. Our hero now portrayed as the villain. What could make a better story? When will someone finally tell it?

Republicans Want Obamacare

Behind this spectacle lies a much larger narrative. It’s a keyhole to things to come and may hold answers to this riddle of healthcare reform.

It starts with the process that brought us Obamacare.

Pres. Obama settled on the model Mitt Romney used in Massachusetts. It’s called Romneycare. Romney’s Massachusetts reforms didn’t play well to conservative hysteria. It was too successful to be an effective political piñata. This spared Romneycare the public lynching we see of Obamacare. ‘Conservatives swapped Romneycare with the term Obamacare. ‘Socialism’ now replaced the public debate over the torments of HMO cruelty. So began the attack on ‘socialism’ and the end of any constructive dialogue for true reform of HMO’s.

Romney’s Health Exchange model is built upon a simple purpose. Co-opt gov’t healthcare with ‘private market’ insurance companies. Remember, this was the brainchild of Conservative think-tanks. It was their counter-attack to Pres. Clinton. They considered Clintons healthcare reforms to also be ‘socialist.’ Obamacare was the Republican counter proposal to Clinton.

Obamacare is not about socialism conquering America. The real story is the Republican take-over of the Democrat presidency. Mitt Romney was a hero for implementing Obamacare as governor of Massachusetts. He carried that with pride until the neo-con takeover of the Republican party in the 90’s. Obamacare took that Republican proposal national.

Obamacare only made the Tea Party’s ‘hit list’ once Pres. Obama adopted it. This is a testament to how far right neo-cons have taken the country. Yesterday’s Republican scheme is today’s Democrat ‘victory.’ Behold: the old right is the new left. Obamacare is the Republican victory over the 1980’s Democrats. It’s silly to talk of compromising with Republicans when Obamacare is, itself, the liberals comprise to Conservatives. Given the short shelf life of today’s politicians and journalist, few recognize it as such.

Calling this Obama’s legacy is a misnomer. The policy belongs to Republicans and yet, its passage was in spite of them. That would be to Obama’s credit. This is more a war comedy between political dyslexics rather than true ideological posturing by either side. How our political commentators miss the drama of such delicious absurdity.

Obamacare : Republican Cure-all

Obamacare became ground zero against liberals and Pres. Obama. And yet, there was still a high cost for this hypocrisy. It was first seen in the last presidential election. Mitt Romney personified this hypocrisy. That offended American sensibilities. This played to Pres. Obama’s second term win over Romney.

Romney’s lost election is but a prelude to a much larger dilemma. To begin, Conservatives have no ‘alternative.’

Obamacare is the official Republican response to healthcare. That is why they have no counter proposal to it. There is no backup plan.

Now the really scary part: Obamacare is the Republican’s one and only response - to everything:

  • School vouchers (Public Exchange),
  • Social Security vouchers (Public Exchange),
  • Medicare and Medical Vouchers (Public Exchange),
  • VA Vouchers and yes, the
  • Healthcare exchange too.

Each of these programs are built upon some variation of this model. Often referred to as ‘block-grants.’ You shop some form of voucher around to some kind of platform of exchange of different service providers.

This is more than an ideological refrain. It’s Republicans only public policy template. It’s the fourth leg to:

-- no taxes,

-- de-regulation and

-- overturning worker protections.

-- Exchange Boards

Obamacare : 4th Leg of Republican Platform

Obamacare adds the fourth leg to this Conservative platform. Pres. Obama is the true standard-bearer of the Reagan legacy. Actually, he tops it. Pres. Obama has a larger military budget, offers lower taxes and implemented greater de-regulation then Reagan ever could. And wages are lower too. Much lower. Obamacare adds the final piece of the puzzle. The old Republican agenda of the 1980’s now stands complete.

And now for the final twist to this whole story. This campaign against Obamacare is laying the frame work against all Exchange programs. Their campaign may prove the death nail of it. Republicans are proving this working model as one big hoax.

Obamacare maybe the final victory for Republicans, but their drive against it holds the greatest undoing for it. The Conservatives cure-all policy of the last 40 years is now being dismantled by Republicans. How the media failed this side of the story is once again just stunning. [i]

Obamacare : Repeal of HMOs

Here we raged against HMO death camps. And, we talked of the absurdity of ideological incest. Now let’s look at Obamacare. What is it? What does it really do? And what is missing and most of all, how can we fix healthcare.

Obamacare is America’s only official response to HMOs reign of death, fraud and abuse. Obamacare effectively eliminates the worse of HMO crimes with a surprisingly simple set of requirements. Act like a true insurance company. Little more, nothing less.

Requirements:

  • HMO’s cover all medical services advertised (but not delivered).
  • No longer deny coverage after the fact.
  • They must provide basic services: rehab, mental health, hospital stay, emergency care and ambulance pick-up.
  • No more cancel for ‘pre-conditions.’
  • And no more bills for hundreds of thousands of dollars for services that were suppose to be covered. The most you have to cover: $12k.
  • Healthcare for Kids - guaranteed.
  • And most of all, no more uninsured.

The ‘sticker shock’ of Obamacare simply highlights the last 40 years of HMO fraud. The so called ‘extra’ cost is the bill HMO’s stick on the back end - after you get sick – and make you cover it (bankruptcy or death – often both).

Obamacare takes this cost from the backend and parcels it out into monthly premiums over the decades. That’s insurance. Yes, it’s going to be more expensive - initially. If that’s bad, try paying it in one lump sum as HMO’s do.

HMO’s lopped off 25% to 40% of our health care coverage with their ‘cost savings.’ A true insurance program by definition would re-incorporate those services. Obamacare does just that. The cost would therefore also jump by as much as this same 40%. We see this for some of the Obamacare packages.

This brings us to where the story leaves off today. The HMO deception has left people with a false sense of security. They are content until HMO’s drop them. Obamacare is now offered up as the sacrificial lamb for this HMO fraud. BUT: There’s good news.

Obamacare has several big advantages.

  1. The first of course is that HMO’s are being wiped out. Obamacare is the extermination of HMO’s as an industry. Few other reforms will reach such a clear, direct and immediate impact for saving American lives - millions over the decades. This is America’s true ‘national security’ mandate.
  2. Second, this means we get full health insurance service once again.
  3. Third, most of these are now offset with tax-rebates or outright cash subsidies. It’s affordable.

(The simple solution to 5 million canceled policies would be to offer the same tax and subsidies as other Obamacare policies. It would be a temporary transition period.)

  1. Fourth, a gradual price savings. Yes, savings.

HMO: Ground Zero of US Healthcare Cost

It appears that 40% of our price surge over those of other countries was likely from HMO gauging. Phasing out HMO’s should drop those costs by this same 40%.

Critics talk how tax-payers will be stuck with trillions in rising costs.

Here’s the calculus they overlook.

  • There is the ‘economies of scale’ - larger volume of customers.
  • There’s savings from prevention care versus cure – emergency room bills versus preventative check-ups for those that did not have insurance.
  • 50 million new buyers with added income added to the pool.
  • Savings from replacing HMO’s.

The first 3 areas are accounted for by Pres. Obama. The forth has been overlooked. The savings gained by replacing HMO’s is likely larger then all others combined. (Yes, Raghu-nomics specializes in finding such things.)

America’s price surge started in the 80s. This corresponds to HMO’s takeover of the healthcare industry. Transforming HMO’s into real health insurance should reconfigure those costs closer to the international norm. That norm runs about a third lower America’s national average.

HMO’s have been pocketing the difference between those of the world and our own. Hence, HMO record profits for 40 years. Obamacare reclaims those profits for better service and reduced prices. If successful, this would be the ‘secret’ behind Obamacare. Ironically, it is a legacy that actually belongs to the Republican think tanks and Mitt Romney. Maybe we can all get along after all.

See the chart below. It shows how the US price spike started in the 80’s when HMO’s took over our health care. It has pulled away from the pack ever since. This corresponds to the rising cost for less service as compared to the rest of the world. This suggest that phasing out HMOs would shrink costs in line with those of the other developing nations.

The Chart also indicates that cost will begin to fall just as service and quality improves. Therein holds the promise to the greatest savings to be had from Obamacare. This is likely going to come from ending HMO’s corruption of our healthcare industry. Herein lies the greatest value of Obamacare.

Caption: In 2011, the most recent year in which most of the countries reported data, the U.S. spent 17.7% of its GDP on health care, whereas none of the other countries tracked by the OECD reported more than 11.9%. And there’s a debate about just how well the American health-care system works. As the Journal reported recently, Americans are living longer but not necessarily healthier .

You can find the underlying data here.

http://blogs.wsj.com/economics/2013/07/23/u-s-health-spending-one-of-these-things-not-like-others/

Obamacare: Not enough

The evil dragons of HMO’s slain at long last, healthcare cost reduced, service improved, and yet, there remains one more chapter to this story. HMO’s may be the reason for our price inflation against those of other developed countries. But, those countries no longer can manage their growing cost either. Healthcare is rising too fast for them as well. Their budgets are beginning to fray. Bringing US healthcare in line with these other countries would reduce our present cost, but it is still be too expensive for a growing millions of Americans.

Obamacare cures the largest market distortion caused by HMO’s, but how to fix the remaining shortfalls in price if not performance and delivery? This is atop all the liabilities Republicans point to. There’s everything from gov’t consolidation and meddling; to VERY serious privacy concerns. We have the confusion from the slew of players overlapping into a muddle of nuances. Meanwhile, other markets have a lack of choice. Centralization is proving quite unwieldy. It’s personified by the websites troubles but breaks out into a thousand overlaps and short falls from servicing agents and doctors, to billing and comparative pricing and services. These are legitimate complaints and Republicans have created the Encyclopedia on them.

Republicans are going after Obamacare with a vengeance. This is chiseling out the net liabilities of their own Exchange Model. All the same problems will prove true of other social services they wish to remodel into an Exchange program. Republicans are making the case that this Exchange Model program itself is not enough to solve healthcare’s rising cost. It foretells all the reasons why this model won’t work for other programs as well.

In short: if the Democrat and Republican solutions don’t work, what will?

Solution: Lifestyle Pricing

Raghu-nomics introduces a new approach. It solves these problems. It incorporates the best of both parties while leaving aside the liabilities of each.

It starts from a simple premise: Life style.

50% of all medical cost is lifestyle related.

The solution: cover the social cost of your own lifestyle.

In turn, costs drop by this same 50%.

Life style has a corresponding social cost. Social cost provides the most ‘scientific’ policy template. It presents this accurate baseline for identifying cost, finding the best venue to savings and highlights service remedies.

This lifestyle approach offers all the healthcare services demanded by Democrats. It covers the cost savings business needs and that workers want. Republicans will love it too. It incorporates personal responsibility while also providing a ‘free-market’ solution.

ROOPA: Responsibility for One’s Own Products & Actions

It’s called ROOPA: Responsibility for One’s Own Products & Actions. It’s healthcare system tailored for a 21st Century world. Lifestyle is as much discretionary as it is the most expensive category of the entire healthcare universe.

It holds one last and even larger advantage. It reverses the curse of modern medicine: disease based profits.

Today’s money is found upon the cures rather then prevention. There’s little profit gained by prevention. HMO’s were supposed to help this side of the equation, but it was too far removed from the source of the problem. ROOPA zero’s in on this problem. ROOPA reverses this disease based incentives by going to the source: lifestyle. You, the end user, can now enjoy the direct savings through Lifestyle Budgeting.

Lifestyle budgeting offers more than just savings. You choose to pay when it best suits you and your budget. The social cost is now attached to the retail price of the lifestyle item of choice. Only buy those things when you have the interest and money for it. You never have to worry about getting ahead of your healthcare needs. It’s paid at the time you purchase your products of choice. It’s a pay-as-you-go insurance. The risk is reduced into the smallest of payments.

Examples

Raghu-nomics works from a social cost basis. The social cost of smoking related healthcare runs about $100 billion a year (as of 10 years ago).

Tobacco

This cost is spread between 500 billion cigarettes or 0.20 cents per cigarette: $4 per pack. This compares to the national average of $4.50 though some places are higher: Hawaii ($8); NY (as high as $11).

Half the Cost, Triple the Service

A $100 billion tab over the next decade gives us a $1 trillion dollar fund. This is how much we spend every decade on tobacco. A $1 trillion dollar budget carries real negotiating power; mammoth economies of scale, etc. This reduces the cost of smoking related healthcare while improving services. Contract with a provider. Maybe Kaiser Permanente. Offer them $600 billion for 3 times the service. These savings would be passed on to smokers. You get the Republican tax-refunds with Democrat services.

Free Market Balance

You now have the tobacco industry faced off against insurance – a ‘free market’ balance. Presently, gov’t stands as the middle man between tobacco and the insurance industries. Therein lies the corruption and inefficiencies. ROOPA removes this bureaucratic distortion.

Alcohol: Save $150 Billion

Alcohol runs about $200 billion a year. About $150 billion of this cost is due to alcoholics. They only make up 4% of all drinkers. Spend $10 billion on rehab programs and you just saved $150 billion while improving services.

Obesity: 10 Cents

Obesity also runs about $200 billion . Say this comes to $0.10 cents for every hamburger, fries, ice-cream and soda pop. This dime buys you universal healthcare. And it’s free. It covers all obesity related care. This is not like the Democrats 4 cent tax on soda pops. It’s not a tax. It’s your insurance premium. It’s paid as you go. It’s the world’s most affordable insurance plan: 10 cents.

$7 Trillion Cost Reductions

The combined bill for smoking, drinking and obesity is a whooping $500 billion a year. That’s close to $7 trillion in the next decade. This entire cost burden can now be removed from our insurance premiums as well as gov’t programs like Social Security, Medicare, Medical, VA benefits and all federal, state and local employee benefits.

Reduce Taxes 50%

Removing just three ‘lifestyle’ categories removes this huge $7 trillion burden from gov’t budgets and our private insurance costs. Imagine if we did this with all lifestyle costs.

‘Lifestyle’ cost starts at 50% of all medical cost. It’s likely more. Cover all our own lifestyle costs and we can reduce taxes and insurance by this same 50%. All the while, we are improving services. ROOP offers these upgrades to healthcare and tax policy. ROOPA is just one of the many tools we use at Raghu-nomics. Welcome to Raghu-nomics.

PS.
Here’s another article showing once again the divergence between the cost of healthcare and the explosion of expenses starting once more from the 1980’s.
http://www.fool.com/investing/general/2013/12/21/read-this-before-you-ju...
Note the second chart below. The price inflation begins to double – starting in the 1980’s.


[i] Democrats are unlikely to see this simple victory key. They missed the same helping hand after Republicans went after Pres. Obama’s first $850 billion ‘Stimulus Package.’ $500 billion of the package was in tax cuts. Only $350 went for gov’t related programs.

Republicans pointed to the sluggish economic response as proof gov’t stimulus doesn’t work. They are half right. It’s proof tax cuts don’t work. Democrats half heartedly referred to this. They could not scream too loud without making the stimulus look bad.

Pres. Obama should have offered the $350 billion in gov’t stimulus programs. No need for the other $500 billion in tax cuts? It would have been responsible ‘gov’t spending’ for the same economic benefit. Tax-cuts it made for great politics. It framed Republicans out to be against tax cuts when offered for the middle class rather then the rich. It worked brilliantly. It cemented public perception of a Republican party out for the rich and against the American middle class – even when it came to tax cuts. Great political strategy; dreadful economic policy. Once again, political posture trumped economic policy.

Why tax cuts don’t work any more: China. Why do tax cuts not work any more? China. China keeps off-setting US business development we get from tax cuts. China does this with massive subsidies to their counter part companies. This short circuits our companies economic turn around that tax cuts would normally produce. Raghu-nomic’s points out that this makes our ‘problem’ more a foreign policy issue rather than an economic one. Therefore, gov’t stimulus via Republican tax breaks or Democrats gov’t spending won’t work. The only answer is to counter the Chinese foreign economic distortion. It’s outlined in our 10 Steps to Great American Jobs.

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