Monday, July 31, 2017

Healthcare is not a right, but...

Remember the last episode of Seinfeld?  The gang is imprisoned forever with each other for failing to rescue a stranger.  For them, at least, Hell will be other people.  I didn't like that last episode, not because I didn't think the characters deserved each other as eternal punishment, but because the premise - that one can be punished for not helping others - is bad law.  Indeed, the greatest difference between here and the hereafter is that here we are not punished for being selfish jerks. I have since forgiven the dramatic license, but in the moment, the lawyer in me got the better of me.

Being rescued is not a right, because it is impossible to prove that one knew that one could have effected a rescue without paying some unreasonable price.  Where does one draw the line on who should rescue whom from what?  The idea is unworkable, and common law, at least, has rejected it.  You cannot have a right to be rescued if no one has a duty to rescue you.

And yet, certain politicians - I hesitate to call them "liberals" anymore, as such labels are losing their focus - claim that healthcare is a "right."  But healthcare is a rescue, and the law says you have no right to be rescued, because no one has the duty to rescue you.  People can volunteer to rescue you, and the society as a whole can agree, in a binding way, to "rescue" you by giving you the funds to buy healthcare from someone who will voluntarily sell it to you.  But those decisions do not arise from the idea that healthcare is a right, but rather from a political consensus that having others pay for one's own care should be a right.  Pols like Pelosi and Sanders argue that we should make healthcare a right because it is a right.  Huh?

I don't believe in economic rights.  In the grand scheme of things, everything is a luxury that some people cannot afford.  How many people are denied the luxury of a roof over their heads and three square meals a day?  We call these things necessities in common parlance to distinguish them from things we can more easily do without, but in the great algebraic continuum of desiderata, there are no necessities, only priorities.  Thus, by calling healthcare a luxury, I am not saying that only wealthy individuals should have health care.  I am saying that only wealthy people can have it.

I say "wealthy people" because a society can declare that all of its people are, by virtue of their membership in the society at any given time, wealthy enough to have healthcare.  All of the industrialized West, except the US of A, has determined that their polities are wealthy enough for all of their members to have healthcare regardless of their individual ability to pay.  One could say that, in such places, healthcare is a "right."  But that's a post hoc legal term, not an a priori bit of natural law from which one can reason - or argue- to a legislative conclusion.

How, then, do we get there?  There's been a lot of talk recently about a guaranteed basic income (GBI).  Lifetime healthcare has an actuarial cost that is more or less equal for all people.  If we assume that healthcare is a valuable commodity, then lifetime healthcare is a guaranteed basic income, delivered in a gift card rather than cash.  I'll bet there's a pretty strong overlap between those who favor universal healthcare and those who support the GBI.  But is the GBI a right?  If not, how can a targeted, actuarially determinable GBI be a right?  Because that's all universal healthcare is.

I like the GBI.  I think the time has come to make "survival" a right.  We should provide a roof and three squares a day to any American who wants them.  And healthcare. We are that wealthy.  We can afford that luxury.  But we can start with healthcare.

Friday, July 28, 2017

Lyin's of the Senate

Without a scorecard, one cannot be sure who is voting for what in the Senate.  But one thing seems to be clear: votes are not politically wasted.  No one votes against a stupid idea his stupid constituents want unless it may actually become law.  Then, as few senators as possible are given the task of "standing on principle," "showing political courage," "putting country over party," or whatever cliche will work to kill the stupid idea before it makes the senators look dumb in retrospect for passing it.

My best guess is that all of these acts of "courage" are carefully orchestrated.  Take last week's "battle" over whether to bring the various doomed Obamacare repeal bills to the floor.  After the vote was taken to proceed to a floor vote, Senator McCain gave a wonderful speech about how the Senate should return to regular order, with committees and hearings and inter-party negotiations and compromises.  It was a stirring speech, delivered after the thing to be stirred was already fully baked.  The horse had left the barn, and McCain was not gonna let him escape some more.

Why was this speech not given before the vote to do the opposite?  The answer is simple: leadership wanted to give members the ability to vote to repeal Obamacare one last time.  They could not get that opportunity if the motion to proceed was defeated, and it would not be seemly at all for them to vote to proceed after the heroic McCain had struggled from his deathbed to exhort them to legislate like, well, legislators.  So, McCain voted for the motion to proceed and then pretended to urge his brethren and sistren to do exactly the opposite of the thing they had just done.  A profile in courage?  Not hardly.

But wait, there's more.  Once the bill got to the floor, something had to be done to keep it from becoming law, because it was terrible and unpopular, without requiring too many senators to vote against repealing Obamacare.  Collins and Murkowski were already committed - it's not clear why, but let's call them brave and move on - but who would be the third necessary vote to bell this particular cat?  Who can exhibit such remarkable independence?  Who can be a maverick and put country first?  In other words, who had the least to lose?  Maybe some old guy with a short life expectancy and maybe a score to settle with our Feckless Leader?  Who might that be?

Reports are that McCain spent a fair amount of time openly chatting with Chuck Schumer on the night of the Obamacare repeal vote.  These are not dances one does as if no one were watching.  This dance was done in plain sight to suggest that McCain got something for his bravery, that his appeal to regular order won't end up making him look like a sap.  One can only hope that he did get something, that regular order does return to the Senate, and that they produce a popular bill that even the morons in the House won't be stupid enough to reject.  I'm not a fan of Schumer - he's a walking platitude, elevated by seniority to a position where a statesman might be useful - but he's not a terrible person.  We Americans may be approaching our Churchill moment, when we do the right thing after trying everything else.

Monday, July 17, 2017

The Rand Paul Compromise

I wish I knew St. Paul's view on healthcare.  Maybe he thought it was a right.  If so, Rand Paul would certainly be the right guy to propose the solution to the healthcare mess that he has come up with.

Being a complete hypocrite, Sen. Paul does not care whether Obamacare disappears.  He just wants to be able to say he voted to repeal it and did not vote to replace it.  It makes no difference to him what the replacement says or does, so long as he can "keep his promise" to vote for the repeal.  After that, if Republican moderates and Democrats want to destroy the country, at least his pecker tracks won't be on the bills.  He'll be the author of the procedure that made the new law possible, but he'll have voted against it, and that's all he has to do to fool enough of the people enough of the time in Kentucky.

I really like this solution.  By allowing Republicans to vote for what Sen. Paul calls "clean repeal," he gives each of them the ability to go home and shout from the rooftops the wholly irrelevant fact that he or she successfully voted to repeal Obamacare.  That's the promise Republican have been making for eight years, and it's the promise they can claim - substance aside, of course - to have kept.  After that, a compromise bill can be created.

On substance, Dr. Paul doesn't understand the issues.  He has latched onto an important insurance notion - adverse selection - but he has not shown any useful grasp of it.  Adverse selection is the tendency of people with the greatest risk to buy the most insurance.  In other words, the people voluntarily buying health insurance are, in general, sicker than those choosing not to buy it.

Adverse selection is a problem for insurers today because, under Obamacare, people can buy insurance from any carrier with no exclusion for pre-existing conditions.  The mandate that forces people to buy when they are healthy does not help insurers, because the insurer acquiring a sick person does not get the money that that person may have paid under the mandate when healthy.  If the person paid the penalty for declining coverage, or was covered by Medicaid or a parent's group plan, the new insurer must rely on a subsidy (or higher premiums on everyone it covers) to defray the cost of pre-existing conditions.

Senator Paul doesn't like these subsidies because the "health insurance industry" is making $15B annually, and he doesn't see why an industry that is making so much money should get a government bail-out.  This is really a stunningly stupid claim.  The insurance companies are making that much money only because they are not forced to participate in the individual Obamacare market.  They have withdrawn from that market so that they can remain profitable.  If the subsidies under Obamacare were increased to the level necessary to attract private insurers, those insurers would make some more money - they are entitled to profit on every class of business - but no more than is usual under our capitalist system.  That's not a "bail-out," as Sen. Paul likes to call it.  It's just how a free private market works.

What Paul does not seem to see is that he is exposing the thread on which the fans of single-payer are dying to pull: administrative costs.  If the insurance companies are making so much money, maybe it's because they charge more than a public payer - Medicare, say - would charge for covering the same ailments in the same way.   (That is, of course, the case.)  He is laying the groundwork for single payer by attacking the insurance industry.  Is that any way for a guy named Rand to think?

But wait!  There's more!  Sen. Paul's solution to the problem of insurers leaving the individual market is to get rid of that market by letting people form non-employer groups.  There are group policies available in other areas of insurance - life insurance through AARP, say - that are based on affinity of some sort, so why not health insurance?  The answer: all of these other insurance programs do have some underwriting requirements; they are actuarially sound and benefit primarily from the economies of scale.  Health insurance policies without pre-existing exclusions are not actuarially sound (see adverse selection, supra) and, therefore, cannot work that way.

Sen. Paul also argues that these pick-up groups would be viable just like employer groups.  If the large-employer market is profitable without subsidies, he, er, reasons, why wouldn't group plans of random citizens be healthy?  Well, one of the first thing one learns in the group insurance business is that group insurance isn't insurance.  Group insurance is "experience- rated." The employer basically pays the cost of all claims, plus an administrative fee.  The insurance policy simply smooths out the peaks and valleys, but premiums are adjusted to match claims over time.  An employer-based plan is an employee benefit, part of the compensation of the employees, with the added benefit of a healthier workforce for the sponsoring employer.  A random group of people with no interested third-party to pick up the rising costs simply would not be viable.

The employer's backstop for employee plans, and the entanglement of membership in the plan with having a job, make the employer market a wholly different place from the random group market.  Indeed, if these sorts of plans were viable, is there any doubt that insurance companies would have lobbied to make them legal?  If they made any damn sense, they would exist already. Because they don't make sense, they don't exist.  Sadly, the same cannot be said for Rand Paul.