i got some deriviatives i'm willing to offer cheap to the red state opt-outers that will more than make up for any (imaginary) tax losses.

But first we'll have to imprison Karl Rove -- after Greta defends him in court...

Quelle surprise.

It's essential that any GOP opposition to HCR, no matter how much it might pay lip service to small government, or a fear of federal intrusion, or states rights, or whatever, ultimately resolve itself into "They're going to take your money, that you earned, and give it to Them. It's their ace in the hole.

And 'Them' is not the insurance industry.

The idea is for it to be self-funding -- a not-for-profit insurance program financed by those it covers.

Then the reformers better expand the pool of people who will be permitted to chose the public option so that it includes more than just the people the insurance corporations don't want to cover.

Subsidies would still be needed to help the poor and middle class pay a portion of the premiums for the public option as well as for the private options. So, revenues from whatever source would be needed to make this thing work. It won't work on premiums alone.

I reality, it's the red states that do opt out that will be whining for bigger subsidies -- to cover the greater cost of private insurance, relative to the smaller incomes of red state inhabitants. There is so much willful stupidity alive and well in the world that it sometimes hurts too much to confront it.

While a progressive response should certainly emphasize the not-for-profit self-financing structure, I would suggest the response also include that any current government subsidies to states that opt-out will cease. We certainly wouldn't want participants of the public option to pay expenses for the stupid.

This is garden variety Republican up is downism. In fact states with public options will subsidize states which opt out. The Conservative's claim is based on the assertion that the cost of the public option is positive. According to the CBO and all wonks I know of, it will be negative.

To add an unnecessary explanation: In an accounting people who exercise their option to buy public insurance will 100% pay the costs, but accountants don't account for the effect of competition on prices. A public option will force private insurers to charge less. This will principally reduce costs to policy holders, but will also save the Feds money as they will pay less in subsidies. The 100 B in reduced federal debt calculated by the CBO is only the Feds part of savings from the public option.

Now Rush et al can stand against cross state subidization by demanding that the funds for subsidies in a state come from that state. That would hurt states that opt out. Even without opt out it would hurt states like Texas who have a huge number of uninsured and which will receive a huge net subsidy.

I'd call the bluff and propose that states can demand that the net flow of cash across state lines be zero and have the excise taxes adjust so each state has a balanced budget. That is opt out squared. States can opt not to cross subsidize other states.

An advantage of this is that it will be good for Maine.

Quoting the OP:
"Financing for a public option would come from those paying the premiums -- those premiums would pay for benefits and administrative costs. That's how it's been structured in both chambers, by every public option supporter on the Hill. The idea is for it to be self-funding -- a not-for-profit insurance program financed by those it covers."

Is that self-funding as in U.S. Postal Service or the federal budget as a whole? The point is, proclaiming a program to be self-funding in no way means that it actually will function this way. Given historic underestimates of governmental expenditures and the track record of the public sector, doubts are well grounded.

Lou can you back that up? The whole point of insurance is that it spreads risk. You seem to be assuming that the only people who would sign up for the public option would be those who have no other choice--an assumption I would assert is faulty.

We should have been calling it a 'self-financing public option', it would have softened this new talking point lie.

On second thought, it doesn't matter what we called it, the lying liars would have still found some other talking point lie.

There you go again, Steve, muddying the debate with Inconvenient Facts. . .

Chocolate Thunder said:
You seem to be assuming that the only people who would sign up for the public option would be those who have no other choice--an assumption I would assert is faulty.

As the bill stands now, the only people who will be permitted to participate in the public option are those who can't get insurance or who don't have insurance offered by their employer. So, as I said, the only people in the "public option" will be people that the insurance corporations have decided that they don't want to cover and people who will need subsidies because they aren't getting part of their premiums paid by their employer.

It's likely that this argument will continue to work its way through conservative circles, but that doesn't mean it makes sense.

The chief device of the Grand Old Party has always been to confuse its supporters with plausible sounding bullshit. Since the party "believers" are preconditioned to think "us good, they bad", it is exceedingly simple to hoodwink them. So long as the new argument has the code words taxes and government with a sprinkling of the word liberal, the GOP talking point will succeed with its base.

And the media, trying hard not to seem as if it's taking sides and loving the drama of it all, will happily play along with the meme. A big question facing the democrats proposed opt-out plan is who will pay for the taxes, they will say.

I say let the 2-year old temper tantrum party have its way. Rather than explain the reality, just say "Ok, you caught us. We were hoping that you'd miss that bit of trickery, but since didn't, we'll go ahead and make the public option be paid for by charging premiums".

Subsidies would still be needed to help the poor and middle class pay a portion of the premiums for the public option as well as for the private options. -lou

Those subsidies would be available to those who qualify no matter what insurance plan they choose, public or private. Those subsidies exist regardless of the presence of a public plan and will be available in all fifty states, even those who opt out.

As Barbara already pointed out, states opting out will actually require greater subsidies, as they will be used exclusively to buy private insurance, but really, those of us in blue states are already used to support the red welfare states.

Bzzz! Try again.

-wasn't Texas recently planning to 'opt out' of the Union?

That would certainly solve a part of the health care problem. . .

I'd prefer for conservatives to understand, but in a way, this is good... some folks might figure, "I'm paying for it so my state should opt in."

Take businesses owned by conservatives. They take advantage of any government program, subsidy, or tax break available. Fine; not to do so would be to give an advantage to competitors who use such benefits. Note that acting on principle -- "I don't like subsidies" -- never translates into "I won't take subsidies."

They've got two sub-narratives going. One involves goodies. The other involves totalitarian plots. Conservatives will take government goodies, always have, they're just concerned about others getting them. But that's something they can bitch about while enjoying their goodies, premium-paid or not. Fear of dependency on government is gonna stop conservatives from taking that carrot, once it's actually dangled? LOL.

We need to ask the Repubs: how are "we" going to get the money back that we've spent, and will continue to spend, on the profit margins private insurance companies make?

Steve:
"As the bill stands now, the only people who will be permitted to participate in the public option are those who can't get insurance or who don't have insurance offered by their employer. So, as I said, the only people in the "public option" will be people that the insurance corporations have decided that they don't want to cover and people who will need subsidies because they aren't getting part of their premiums paid by their employer."

Many who cannot get insurance are financially disadvantaged or have medical preconditions for which market value premiums would be much too expensive. The poor tend to be employed in work that does not offer health insurance. None of this encourages a belief that the premiums of this group will be sufficient to cover costs.

These arguments are SUCH crap. First off, 'the public option' will include the uninsured...it is not going to include employer paid health people. ALL these arguments are smoke screens. NONE of these scenarios will come true with THIS reform. But no one has the balls to say 'this is just the beginning...' and THAT is what has the Republicans running and lying and sliming...

They are right. Their taxes are going up to pay for this. If they tax their heath plans like you want, they pay for it.

It is not only conservatives who question this. And it is very reasonable to ask whether or not the current projected price of this legislation -- under 900 billion dollars over 10 years -- is going to be enough to subsidize those lower income folks who will need subsidies to pay for premiums in either the public plan or private plans.

Paul,

As stated above, those people are going to be getting subsidies regardless of which health care plan they choose, public or private.

Even in states that opt out, health insurance for the impoverished will be subsidized by tax payers.

So the question is, would you rather subsidize private insurance at absurdly high rates, or a public option at reasonable rates?

Neil B:
We need to ask the Repubs: how are "we" going to get the money back that we've spent, and will continue to spend, on the profit margins private insurance companies make?

Neil, I'm a small business owner. The profits I make reflect the value of my work. What incentive does anyone have to work if income covers only their costs?

It's a wingnutty fantasy considering that the majority (if not all) of the states that would want to opt out are Red States which
a) Most of which get more in Federal taxes than they pay for (exceptions Nevada and Texas)
b) Have a significantly higher % of uninsured
c) Whose populations are also unhealthier and would likely use/need more Healthcare bucks.

Amazing how acolytes of the "invisible hand" such as Karl Rove and Rich Lowry fail to grasp how this thing will actually work. I mean, Republicans are fond of telling us all how we just don't understand how markets and business work. So it's curious, then, that it's failed to dawn on them that if, for example, a big company like HP was planning on expanding operations and looking for a state in which to locate this new operation, and say they had a choice between a reliable red state like Blanche Lincoln's own Arkansas (where, in fact, they are starting new operations) which has "opted out" of the evul socialest public option and as a result has a private insurance market operating free of competition with health insurance rates 20% higher than say Illinois, which has allowed public option competition...gee, I wonder in that scenario where the company will choose to locate?

Red-state dumbassery couldn't give two shits about how their people are being bankrupted by health coverage costs, but when they start losing businesses to non-dumbass states, they'll step up and sign on to the public option toot-sweet. I've lived too long and seen it happen too many times to believe it will play out any other way.

So basically, what we're talking about is a handful of states that will do their utmost to screw their own citizens out of affordable health coverage for, at most, 2 - 3 years before they catch on to what it's actually costing the state. And then they'll get on board with the public option as well. It won't be tax subsidies that change the map, it will be loss of business in states stupid enough to refuse to reform that will turn the tide.

Funny how this hasn't occured to Rove or Lowry.

States can opt not to cross subsidize other states. - Robert Waldmann @ 11:43

Sounds good. What is the point of opting out to be excluded if you can cross state lines to be included. So the Repugs can say no and still be included?

The bigger picture is our LEADERS in Washington should have the nations interests as their interests. Instead, they are inventing gimmicks to dumb down the solution. And there in lies (pun intended) the problem.

Paul, As stated above, those people are going to be getting subsidies regardless of which health care plan they choose, public or private.

Even in states that opt out, health insurance for the impoverished will be subsidized by tax payers.

Exactly. Premiums will not cover the cost of insurance.

So the question is, would you rather subsidize private insurance at absurdly high rates, or a public option at reasonable rates?

You need to first ask what the actual cost of healthcare is and what are the factors that have been driving it up. The simplistic answer is that the cause lies with greedy insurance companies. The real answer is that contributory factors like false tort claims and the over prescription of diagnostic procedures has driven up costs. There are other factors as well. But it is not as simple as corporate insurance bad boys.

But it is not as simple as corporate insurance bad boys.

Uh, well, yes, really, it is.

Malpractice costs are estimated to add something like 2% or less to the cost of our health care system. That leaves another 28% unaccounted for. Considering that most health insurers operate with profit margins of 15% or higher, you do the math. It's by far the biggest waste in the system.

What incentive does anyone have to work if income covers only their costs? -Paul

Nonprofit company employees still make a salary, and still invest money in the company. When the health insurance industry was predominantly nonprofit, it worked quite well.

When you're dealing with health insurance, there is a clear conflict of interest between profiteering for shareholders and paying for health care services.

A small business owner should (and I'm sure does) recognize the vast difference between their business and a publicly traded corporation.

Isn't taking care of your fellow Americans enough motivation for a health insurance company to do their best job?

Oh boy, I just read your latest post and you mentioned tort reform. Well, that's a conversation ended for me. One only needs to look at states that have enacted tort reform to see that's a bogus red herring.

Adios.

I do love the fact that Paul the small business owner would rather have his employees go without health insurance than take any assistance from the big bad gummint.

Tell us, Paul, how much did your company's insurance premiums go up this year? Or are you one of those rugged individualists who doesn't think he should be forced to pay for his own employees' health care regardless of the benefits to your company?

This is a promising new concept by the cons. If I opt out of the mythical benefits of the wars in Iraq and Afghanistan, can I also opt out of the part of my taxes that pays them?

By the way, Paul, there's a name for companies that have their employees sign up for Medicaid rather than provide healthcare for them. They're called "leeches." You do realize that your tax dollars are paying for Wal-Mart employees to get healthcare, right?

I do love the fact that Paul the small business owner would rather have his employees go without health insurance than take any assistance from the big bad gummint.

Why make a false accusation? Many small busineses cover their employees and contribute to the costs of coverage in doing so. If they cannot afford to do so then some sort of government option should be available. But the premiums of this group will not cover costs.

Tell us, Paul, how much did your company's insurance premiums go up this year? Or are you one of those rugged individualists who doesn't think he should be forced to pay for his own employees' health care regardless of the benefits to your company?

Have you ever owned a business? We do contribute to our employees every time we draw up a check. Employers match employee deductions as well as contributing to premiums. It's easy for you to be generous with other people's money isn't it?

Paul, your whole argument is stupid on its face, for the simple fact that "your money", if in fact you do provide some type of employee health plan, is already going to pay for people who can't get health insurance either because it's unaffordable and their employer doesn't provide it, or because the private insurers refuse to cover them. You pay for them already in the form of higher premiums, because insured people are overcharged every time they use a hospital so the hospital can cover the losses they incur in providing care to people without insurance.

The best part is, though, that you're not only paying for those people - you're paying first of all something like 800% of what it would cost to just provide them with basic preventative medical care vs. emergency room care (the most expensive care there is), you're also being given the honor of paying the private insurer's 30% markup over their cost - if they need to raise premiums $100 to cover the hospital overcharges (coverning cost of treatment to the uninsured) to the people they insure, then they add another 30% to that because, hey, you gotta keep your profit margin. So the premium goes up $130 instead of just $100.

Makes you feel all warm inside, don't it?

Oh, and Paul? If you're providing insurance for your employees, and your competitor down the road isn't, then you're not only paying for his employees' health care, you're also at a competetive disadvantage because his overhead is lower, so he can undercut you on price.

Heckuva a great system there for your average business owner.

Many small busineses cover their employees and contribute to the costs of coverage in doing so. If they cannot afford to do so then some sort of government option should be available.

There will be if this legislation passes. So remind me again why you're against it since it will actually benefit you if it passes?

It's easy for you to be generous with other people's money isn't it?

Actually, I'm trying to save you money, but all you can see is that someone somewhere might possibly get a benefit you don't think they deserve, so you would prefer to pay more to a private insurance company than pay less to the government for the same coverage. I guess I really don't understand how business works if I find it foolish for you to insist on paying higher costs when there's an alternative that would lower those costs.

But, hey, feel free to refuse the subsidy for small businesses and keep paying 20% or 30% more to your private insurance company every year on principle. I'm sure there's no way that would impact, say, your ability to buy capital equipment to keep your company going.

And, yes, I realize I'm riding this pony into the ground, but taxpayers had a choice when it came to Deamonte Driver: we could pay $80 for a child to have a tooth extracted or we could pay $200,000 in a futile attempt to save his life when the infection from that tooth entered his brain and killed him.

Paul, you're trying to convince me that it makes more sense to pay $200,000 in critical care only to have the child die after all than to pay $80 for the tooth extraction that would have prevented that infection. With your vast business experience, please explain to me why it's better to pay $200,000 for a dead child than it is to pay $80 for a live one.

It is absolutely the case that it is not solely corporate insurance bad boys driving up costs. There is no doubt about that. But there is also no doubt that the current structure of private insurance is incapable of dealing with these other factors, which are attributable to reimbursement mechanisms established by Medicare and concentration of provider markets, and state law refusal to see provider costs as a real problem.

And the punchline is:

We won't let insurers "solve" our cost problem because we don't trust them to make the right trade offs. We won't trust them next year anymore than we trusted them last year, even if they could wield the budget axe in those markets that are hyperconcentrated. This is the real problem, and it's why the public option doesn't just remove profit and lower costs -- it helps to define the normative market behavior that we should expect from insurers in order to start taking a scalpel, or in some cases, a hacksaw, to provider practices that are at the heart of runaway health care inflation.

Right now, we have two players, providers and insurers pointing fingers at each other, and our natural interests in allying ourselves on the side of providers makes us underestimate the importance of provider practices in creating our very real inflationary spiral.

Exactly. Premiums will not cover the cost of insurance.

You persist in missing the point. What you are complaining about has no relevance to the issue of whether the public option is a good idea or not or whether it will save money or not. Those people you mention would be subsidized either way, which means that it is not a point either for or against a public option.

The simplistic answer is that the cause lies with greedy insurance companies.

Gee, that must be why nobody here has claimed this.

The real answer is that contributory factors like false tort claims and the over prescription of diagnostic procedures has driven up costs.

No to the former, yes to the latter, along with quite a few other factors, including insurance profits and monopolies. But the public option helps with your latter claim, just as it has with Medicare, where costs have been rising significantly slower than in the private sector.

"It's likely that this argument will continue to work its way through conservative circles, BECAUSE it DOESN'T makes sense."

There, fixed it for you.

Oh, and Paul? You just made a good argument for taking health care out of the private sector altogether. There should not BE profit in keeping and making people healthy. Good wages, certainly, for the highly-skilled workers necessary in this sector, but money ON TOP of costs? no. sorry.

The lack of profit doesn't keep the Mayo Clinic from providing some of the best health care in the world nor does in keep the best doctors in the world from wanting to work there.

If we can weed people OUT of health care who are in it primarily for the MONEY, that would be a good thing.

They're trying to make it seem like the public option is paid for by taxpayers instead of by premiums like any other insurance

"States can opt not to cross subsidize other states."

Oooh, can we extend this principle beyond just health care? Cuz I would LOVE it if New York didn't have to subsidize Arkansas, Alabama or Mississippi.

Paul, if profits reflected the "value" of work, Rupert Murdoch would be homeless in addition to being a bum.

Oh, and Paul? You just made a good argument for taking health care out of the private sector altogether. There should not BE profit in keeping and making people healthy. Good wages, certainly, for the highly-skilled workers necessary in this sector, but money ON TOP of costs? no. sorry.

Tell that to your doctor or dentist. The wages they and their employees make are a function of their profits. Noone works for cost. The profit motive is the incentive that drives one through years of medical school (and hard work).

They're trying to make it seem like the public option is paid for by taxpayers instead of by premiums like any other insurance

That might be because the poor and those with medical preconditions would constitute a large share of the public option program. Their premiums would be subsidized i.e. paid for by taxpayers.

Makes no sense to opt out of the public option, period. Nothing substantive is gained by denying the residents of your state the opportunity to choose a public option, once it exists.

As for federal costs, there will almost certainly be initial subsidies to get a public option going, even if the government doesn't continue to bolster the public option after that.

What happens, btw, when disgruntled red-staters start migrating en masse to states that do have the public option (assuming, as I don't, that the public plan would actually prove to be cheaper than private plans)?

Reid's plan is pretty absurd because the politics of health care reform are absurd. It resembles a satirical proposal I made earlier this year -- that Dems in Congress introduce 2 public option bills, one plan open to Republicans and one for the rest of us. Congressional Republicans would have to agree to allow the latter to pass in exchange for Democratic help in voting down the Republicans' reform bill.

I guess I really don't understand how business works if I find it foolish for you to insist on paying higher costs when there's an alternative that would lower those costs.

You have not shown evidence of reduced cost. Is the government not paying doctors, nurses and others administering care? Is it not paying for MRIs, CTs, lab work and more? Where are the reduced costs?

BTW, funding for government programs comes in large part from- (guess)- taxes on company profits.

That might be because the poor and those with medical preconditions would constitute a large share of the public option program. -Paul

Or you could stop being dishonest and tell the whole truth which has been explained to you multiple times in this thread. Public or private, health care for the poor is subsidized. Period. It's subsidized now because tax payers end up picking up the emergency room for those who cannot afford care.

Insurance will be subsidized after a bill passes, be it private or public. The choice, my dishonest friend, is how much do you want to pay? Do you want to pay the exorbitant, quickly rising private rates or a reasonable public rate?

Any way you slice it, status quo, private insurance, or public insurance, you, me, and all other tax paying individuals will be subsidizing the poor.

Progressives are simply trying to do is go with the most fiscally sound and socially responsible option on the table.

You have not shown evidence of reduced cost. Is the government not paying doctors, nurses and others administering care? -Paul

The reduced cost comes mainly from two things: the virtue of being nonprofit and a significant reduction in administrative costs.

You know, this option would only be available to those who need it most, about 12 million people, or 3% of the country. Do you really, honestly think it's going to cripple the nation to help give them an option they can afford?

Just make it easier on them. Tell them that Yes, if their state opts out of the public option, they will receive double their full share of all tax money given to the aforementioned public insurance company for expenses over and above the amount that it collects in premiums from policy purchasers AND that such payments will be in shiny silver dollars emblazoned with the state seals of opt-out states, hereafter to be referred to as "The New Confederacy." These beautiful collectors' items must be reserved in advance for the discriminating student of Americana for the low, low fee of $100.00 (shipping, handling etc.), payable in cash, credit card or signed over social security check.

Tell them that Yes, if their state opts out of the public option, they will receive double their full share of all tax money... -tom in ma

I know this isn't where you were going with it, but it cannot be said enough that most of the states who would consider opting out already receive back more tax dollars than they put into the system.

The hypocrisy of these states is that they, nearly to a one, espouse a disdain for a 'welfare state' when in reality they are welfare states.

Fuck Abe Lincoln.

That might be because the poor and those with medical preconditions would constitute a large share of the public option program. -Paul

Or you could stop being dishonest and tell the whole truth which has been explained to you multiple times in this thread. Public or private, health care for the poor is subsidized. Period. It's subsidized now because tax payers end up picking up the emergency room for those who cannot afford care.

You might wish to take your own advice and be honest about the total picture. Insurance coverage- private or public- covers non-emergency treatment. It expands options and expands cost liability. I thought you understood that.

The reduced cost comes mainly from two things: the virtue of being nonprofit and a significant reduction in administrative costs.

Costs do not decrease by virtue of being non-profit. Government bureaucracies are less efficient and more costly. Where do you get your inspiration- the Postal Service? the military? the fact that the government cannot come close to balancing its budget on federal and state levels?

You know, this option would only be available to those who need it most, about 12 million people, or 3% of the country. Do you really, honestly think it's going to cripple the nation to help give them an option they can afford?

We do need to provide for the poor. But we also need to be smart about it and consider options anethema to those who think the government is Santa Claus.

You have not shown evidence of reduced cost. Is the government not paying doctors, nurses and others administering care? Is it not paying for MRIs, CTs, lab work and more? Where are the reduced costs?

In overhead. Private insurance companies spend 30% of their budget on overhead. Public programs like Medicare spend 3% of their budget on overhead. That's, what, a 27% savings? If you were told that you could pay either 30% or 3% of your income in taxes, which would you choose?

Of course, you also seem to think it was cheaper for us to pay $200,000 for failed critical care rather than $80 to remove the tooth that caused the need for the critical care, so I have a feeling you aren't quite as good with money as you seem to think you are.

Insurance coverage- private or public- covers non-emergency treatment. It expands options and expands cost liability.

And in a world where hospital and doctors could refuse care to people who couldn't pay, that would be the way it worked. If you were perfectly willing to step over dying people in the streets every day who couldn't afford to see a doctor, your premiums would be very low.

But, unfortunately for you, that's not the society we live in. In the society we actually live in, people who become critically ill are paid for by those of us who can afford it -- not only through our taxes, but through our insurance premiums, because doctors and hospitals have to charge enough to cover the care that they won't be paid for. And because we're talking about people who didn't seek medical help until they were extremely ill, they are much, much more expensive to treat than if their condition had been treated earlier.

If you want to repeal all the laws that require hospitals to treat everyone regardless of ability to pay, then you might be able to have your insurance premiums go down. And, hey, we can always grind the resulting corpses into dog food and make a profit off them. Anything for a buck, right?

"Medicare claims its administrative costs are less compared to private plans. Don't fall for it. It's a classic apples-to-oranges comparison. Government costs actually are higher, as The Heritage Foundation explains:

In 2005, Medicare's administrative costs were $509 per primary beneficiary, compared to private-sector administrative costs of $453. . . . From 2000 to 2005, Medicare's administrative costs per beneficiary were consistently higher . . . ranging from 5 to 48 percent higher, depending on the year. . . .

This is despite the fact that private-sector "administrative" costs include state health insurance premium taxes of up to 4 percent . . . --an expense from which Medicare is exempt--as well as the cost of non-claim health care expenses, such as disease management and on-call nurse consultation services.

Medicare's overhead costs are consistently understated because the government doesn't count major costs incurred by other federal agencies in support of Medicare. If those are included, the costs virtually double."

-Ernest Istook

The Heritage Foundation as a source? Seriously?

Keep wearing the ideological blinders doubtful. You'll never have your viewpoints challenged if you do.

Keep wearing the ideological blinders doubtful. You'll never have your viewpoints challenged if you do.

ROFL... Oh, the irony...

Medicare's overhead costs are consistently understated because the government doesn't count major costs incurred by other federal agencies in support of Medicare. If those are included, the costs virtually double.

Oooh, can we play this game with the defense budget? Because if we get to count in all of major costs incurred by other federal agencies on behalf of defense, I bet we could at least double it. If we throw in state agencies who have to hire temporary workers to fill in for reservists who are on duty in Iraq and Afghanistan, we could probably even triple it.

Again, you're not really impressing me with your financial skills here.

That might be because the poor and those with medical preconditions would constitute a large share of the public option program. Their premiums would be subsidized i.e. paid for by taxpayers.

Which, as repeatedly explained to you, is completely irrelevant to the subject at hand. Do come back when your intelligence and reading comprehension have increased, won't you?

I do so love it when a mindless partisan posts endless drivel like this. If there was any doubt about taking him seriously, all such doubt is removed.

Oh, and if Ernest Istook is so very, very concerned about Medicare costs, he shouldn't have helped Bush's Medicare fiasco pass when he was in the House.

You'd think the sheer hypocrisy of whining about the high cost of Medicare and yet passing the disastrous Medicare Part D bill would make a person's head explode, but apparently, like the Queen of Hearts, Istook can believe two opposite things at the same time.

Noone works for cost. The profit motive is the incentive that drives one through years of medical school (and hard work).

Which has bubkis to do with insurance, the topic of this thread. Tell me, do you always have this much trouble staying on topic, throwing out straw men, and generally evading any serious discussion?

You have not shown evidence of reduced cost.

It's called "economies of scale." You should look into it. You should also look into the percentage rise in health care costs between Medicare and private sector over the past, oh, 15 years or so. Guess which sector has seen its costs rise faster?

And that's not even counting the fact that Medicare doesn't need to advertise, doesn't need to make a profit, doesn't need to offer dividends to investors, and offers lower salaries to its top echelon.

You really do need to turn on your brain before you post here. All you're doing is making yourself look foolish.

Government bureaucracies are less efficient and more costly.

No, in fact, they're not, not when it comes to medical care. Not only do we have plenty of examples worldwide, we also have two examples here in the U.S. -- the VA Hospitals and Medicare, both of which operate cheaper than do their private sector counterparts.

Has it really escaped your notice that every major industrialized nation does health care better and cheaper than we do?

Where do you get your inspiration- the Postal Service?

ROFL... At least our information is accurate, as compared to the drivel you've been spewing.

See, Paul, there's a problem with taking seriously anything put out by the Heritage Foundation: it's almost always wrong, as is that "study" that you cited above.

Paul Krugman deals with that quite nicely:

Well, whaddya know — this is an old argument, and has been thoroughly refuted. Jacob Hacker:

These administrative spending numbers have been challenged on the grounds that they exclude some aspects of Medicare’s administrative costs, such as the expenses of collecting Medicare premiums and payroll taxes, and because Medicare’s larger average claims because of its older enrollees make its administrative costs look smaller relative to private plan costs than they really are.

However, the Congressional Budget Office (CBO) has found that administrative costs under the public Medicare plan are less than 2 percent of expenditures, compared with approximately 11 percent of spending by private plans under Medicare Advantage. This is a near perfect “apples to apples” comparison of administrative costs, because the public Medicare plan and Medicare Advantage plans are operating under similar rules and treating the same population.

(And even these numbers may unduly favor private plans: A recent General Accounting Office report found that in 2006 Medicare Advantage plans spent 83.3 percent of their revenue on medical expenses, with 10.1 percent going to non-medical expenses and 6.6 percent to profits—a 16.7 percent administrative share.)

The CBO study suggests that even in the context of basic insurance reforms, such as guaranteed issue and renewability, private plans’ administrative costs are higher than the administrative costs of public insurance. The experience of private plans within FEHBP carries the same conclusion. Under FEHBP, the administrative costs of Preferred Provider Organizations (PPOs) average 7 percent, not counting the costs of federal agencies to administer enrollment of employees. Health Maintenance Organizations (HMOs) participating in FEHBP have administrative costs of 10 to 12 percent.

In international perspective, the United States spends nearly six times as much per capita on health care administration as the average for Organization for Economic Cooperation and Development (OECD) nations. Nearly all of this discrepancy is due to the sales, marketing, and underwriting activities of our highly fragmented framework of private insurance, with its diverse billing and review practices

You should always remember:

1. Don’t believe anything Heritage says.

2. If you find what Heritage is saying plausible, remember rule 1.

In short, Paul, your one and only verifiable bit of information on this thread is completely false. Sorry to burst your bubble, but your every post on this thread has been dead wrong, usually embarrassingly so. Do feel free to come back when you've turned your brain on and done some homework.

That was an excellent copy and paste job. I think those two rules can also apply to anyone who writes for NYT. Paul Krugman likes to use the term "apples to apples" in his comparisons, yet I only see one side of the equation being compared - Cost (the other side being quality and coverage). I would truly be convinced that this article is an "apples to apples" comparison if he can stress the fact that Medicare maintains or exceeds the same quality/coverage as private companies. However, being that Medicare denies more claims per capita than any private company, I think he decided to leave that side of the equation out of his argument altogether.

Also, despite everyone trying to trash Paul -The small business owner's integrity, he managed to only address peoples' arguments and left personal feelings aside. That level of integrity is highly admirable.

"Also, despite everyone trying to trash Paul -The small business owner's integrity, he managed to only address peoples' arguments and left personal feelings aside. That level of integrity is highly admirable."

Oooh, oooh, oooh, I'm a small business owner !!! Can I get a cookie, too ?

Too bad everything Paul said was wrong, wrong, wrong. He must not deal with his business's health insurance premimums very often, because he won't like what he sees. I'll tell you what I see every March come renewal time: bend over, and we're not even going to give you the benefit of some lubrication. It's like the Joe the Plumber tax thing all over again. A bunch of right-wing "small business owners" come out of the woodwork to voice all sorts of completely outlandish, and wrong, opinions about business taxes. It's almost as if they aren't small business owners at all...

And, I know it must make your head explode, but there are a *lot* of small business owners in this country that aren't Republicans, and who don't pray at the alter of the Chamber of Commerce and the Heritage Foundation.

And finally, Paul ? I'd be pleased as punch if my business never made another dollar of profit if I had a guarantee that it would meet my costs every year, which coincidentally include my salary and the salary of my employees. I'm pretty sure that most small business owners would feel the same way.

You may certainly have a cookie. And Did I say anything about Paul being a Republican? I was simply identifying him as the small business owner because there were 3 Pauls I was addressing: Him, PaulB, and Paul Krugman.

And your argument is a little too subjective for me. If you say he's wrong wrong wrong... I'll say he's right right right, and we can go all night. Let me know when you back up your claims with something better than "We're not giving you the benefit of lubrication"

Also what kind of small business do you run exactly if your goal is to not make a profit? This is an honest question

I would truly be convinced that this article is an "apples to apples" comparison if he can stress the fact that Medicare maintains or exceeds the same quality/coverage as private companies. However, being that Medicare denies more claims per capita than any private company, I think he decided to leave that side of the equation out of his argument altogether.

And your point might make sense if Krugman hadn't been comparing Medicare programs. He wasn't comparing Medicare to general health insurance. He deliberately compared two kinds of Medicare: regular Medicare, which is administered by the government, and Medicare Advantage, which follows the same rules but is administered by private companies.

How is comparing Medicare to Medicare Advantage comparing apples to oranges?

That was an excellent copy and paste job.

LOL.... Just following the example that Paul set. You don't hang around blogs too much, do you?

Paul Krugman likes to use the term "apples to apples" in his comparisons, yet I only see one side of the equation being compared - Cost

Gee, maybe that's because he was responding to an erroneous article about ... wait for it... cost? Ya think?

(the other side being quality and coverage).

By all means bring those up if you have something to say there and have information to bring to the table. I doubt you do, though, since even there Medicare does a better job than its private sector competition.

I would truly be convinced that this article is an "apples to apples" comparison if he can stress the fact that Medicare maintains or exceeds the same quality/coverage as private companies.

Like I said, bring it on.

However, being that Medicare denies more claims per capita than any private company

ROFL.... Talk about a non "apples to apples" comparison. You know, you really shouldn't reply to a debunked claim with another bullshit, already-debunked claim. Let's examine just one item here: the pre-existing condition. Funny how that doesn't show up on the list of "denied by the payer" claims in the chart that's made its way through the right-wing blogosphere.

There are other problems with that data, as well, which render it complete bullshit, but I'll leave that for another time. Here's a couple of free clues, though: the chart doesn't include "dropped" policies, the chart omits literally millions of records, and so on. Suffice to say that your claim is just as wrong as was Paul's.

Also, despite everyone trying to trash Paul -The small business owner's integrity, he managed to only address peoples' arguments and left personal feelings aside. That level of integrity is highly admirable.

ROFL.... Propagating false statements and lies is not "integrity," by any meaningful defnition of that word.

source - WSJ

Mnemosyne I didn't see your post until now. You're right - I misunderstood exactly what Medicare Advantage entails. However, your "apples to oranges" question is answered in #4 in the 10 reasons above.

Oh and I'm still curious as to what kind of business someone runs if their goal is to not make a profit. What is your goal exactly? To break even?

I would love to bring it to the table. And no, I don't hang around blogs much. If I did, I would probably type, "ROFL....." constantly

1) Medicare is going bankrupt. The Medicare Trustees estimate that the program will run short of money starting in 2017. Medicare will drown in a sea of red ink, with spending over the next 75 years outpacing dedicated revenues by nearly $38 trillion.

2) Private payers are bailing out Medicare. According to Milliman, an independent actuarial firm, Medicare—and to an even greater extent, Medicaid—underpays doctors and hospitals, shifting costs to private insurers. Milliman estimates that the average family in a private PPO health plan pays an additional $1,788 a year to compensate for underpayments by Medicare and Medicaid, representing a "hidden tax" on commercial payers totaling $89 billion a year.

Providers could not keep their doors open without the higher payments from private insurers. A recent letter to Congress from 13 leading health-care delivery organizations, including the Mayo Clinic, said "many providers suffer great financial losses associated with treating Medicare patients." They said that if these rates were expanded to patients who currently have private insurance, the result "will be unsustainable for even the nation's most efficient, high quality providers, eventually driving them out of the market." That means we would say goodbye to some of the best health-care systems in the country.

3) Expansion of entitlement programs threatens our economic security. Congressional Budget Office Director Douglas Elmendorf broke the bad news in July. Reform legislation before Congress would worsen the federal government's already bleak budget outlook, increase the deficit, and drive the nation more deeply into debt. Instead of bending the cost curve down, Mr. Elmendorf told senators their reform proposal would "significantly increase" costs.

4) Low administrative costs are a mirage. The claim that Medicare's administrative costs are only 3% is fantasy. If all Medicare costs—such as revenue collection, personnel and enforcement—were accounted for, its administrative expenses would be at least twice as high. And it still wouldn't be providing services private insurers do, such as nurse hotlines, decision-support tools and fraud detection, or paying the income, property and provider taxes that private plans must pay.

5) Medicare is rife with fraud. According to the FBI, between 3% and 10% of all health spending is lost to health-care fraud. Despite the president's promise this money could be recaptured to pay for his reform agenda, Congress has shown itself to be remarkably incapable of curtailing fraud and abuse in government health programs.

6) Medicare short­-changes seniors. Medicare exposes patients to unmanageable costs if they become seriously ill—even limiting the total number of days a patient may spend in the hospital. The program covers only about 50% of the health costs of seniors, and most have supplemental insurance to fill in the gaps. This is not a model for comprehensive coverage.

7) Medicare's model is obsolete. Its basic benefit structure uses a fee-for-service model designed in 1965 which has not been altered since, except to add prescription drug coverage almost 40 years later. In contrast, private plans are continually evolving. They create incentives for patients to become more informed about their health choices, and offer innovative programs for disease management, wellness and prevention, and care coordination to improve quality and save money.

8) Payments are too low. Washington decides how much doctors, hospitals and other providers will be paid down to the smallest detail, with mountains of regulation and paperwork to track the politically driven process. Medical professionals are in a perpetual battle with Congress over their payment rates, and many physicians refuse to accept new Medicare patients because payment rates are so low. With few exceptions, Medicare's solution to cost containment is the club of price-controls, not innovation and efficiency.

9) Medical decisions are made in Washington. Patients and their doctors are slowly losing the ability to decide what course of treatment is best. Medicare's decisions to cut funding for the cancer drug EPO, implantable cardiac defibrillators and virtual colonoscopies, for example, have led to epic battles between providers and politicians, while patients and their doctors watch from the sidelines. Medical decisions, which should be made by doctors and patients, are being made by politicians.

10) No one is running the show. If the government is so good at running health-care programs, why has the Obama administration not yet nominated an administrator for the Centers for Medicare and Medicaid Services? These government health programs cover 100 million Americans—the largest health insurance plans in the country—and yet the top office is vacant.