Tea Party demands to eliminate the Medical Device Tax in the ACA are based on a lie

October 18, 2013 at 2:58 pm (Uncategorized) (, , , , , , , )

During the recent debt ceiling debacle in Congress, Tea Partyers were demanding that the medical device tax in the Affordable Care Act be eliminated. This is yet another example of politicians trying to sell a bill of goods to the American people in the guise of shrinking government and lowering our debt. The truth is, in fact, quite the opposite.  The medical-device industry waged an intense lobbying campaign –– spending more than $50 million — even garnering the support of many Democrats who favored the law — arguing that the tax would stifle innovation and increase health care costs.

According to an investigative report by the New York Times, this argument is doubly disingenuous. Not only can the medical-device industry easily afford the tax without compromising innovation, but the industry’s enormous profits are a result of anticompetitive practices that themselves drive up medical-device costs unnecessarily. The tax is a distraction from reforms to the industry that are urgently needed to lower health care costs.

The medical-device industry faces virtually no price competition. Because of confidentiality agreements that manufacturers require hospitals to sign, the prices of the devices are cloaked in secrecy. This lack of transparency impedes hospitals from sharing price information and thus knowing whether they are getting a good deal.

Even worse, manufacturers often maintain personal relationships (sometimes involving financial payments like consulting fees) with physicians who choose the medical devices that their hospitals purchase, creating a conflict of interest. Physicians often don’t even know the costs of the devices, and individual physicians often choose devices on their own, which weakens a hospital’s ability to bargain for volume discounts.

Such anticompetitive practices obviously contribute to higher prices in general. For example, the Government Accountability Office (GAO) found that prices for cardiac implantable medical devices in the United States vary by several thousand dollars. And even the lowest-priced devices in the United States are expensive compared with those in other developed countries. According to the consulting firm McKinsey & Company, the United States spends about 50 percent more than expected on the top five medical devices, compared with Europe and Japan. McKinsey calculates that this amounts to $26 billion in excessive spending each year.Medicare, private health insurers and patients end up paying these inflated prices.

Excessive prices fuel enormous profits — profits that dwarf both the medical-device tax and the industry’s investments in research and development. Consider the device division of Johnson & Johnson, which in 2012 had an operating profit of $7.2 billion. By the company’s own estimate, the device tax would amount to at most $300 million, and its investment in research and development amounts to only $1.7 billion.

There are several ways policy makers could lower device costs. The first step would be to end the anticompetitive practices that prevent hospitals from getting the best deals. 

Currently, medical-device manufacturers allocate only a sliver of profits to research and development and often focus on “tweaks” to existing devices, without providing any evidence that they are of better quality. Competitive pressures from public and private payers would provide incentives for the industry to become more innovative, producing technologies that actually lowered costs and offered truly advanced breakthroughs.

Instead of using its clout to lobby against the device tax — which helped foment opposition to the Affordable Care Act — the medical-device industry needs to share the responsibility of lowering costs for patients, businesses and taxpayers.

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What Romney and Ryan are really planning to do…

October 7, 2012 at 5:47 pm (Uncategorized) (, , , , , , , , , , , )

Both Romney and his running-mate have repeatedly stated that their intent is to cut taxes 20% for everybody who pays federal income tax. The cost of such a cut over a ten-year period is approximately $5 trillion, yet Romney now denies having ever said anything about this tax cut.

Both Romney and Ryan say that these cuts would be deficit neutral because, at the same time, their plan would eliminate certain unspecified loopholes and write-offs currently in the tax code. The problem is, even if they eliminated every single write-off, including charitable donations and home mortgage interest, it still wouldn’t come close to covering the cost of the $5 trillion tax cut.

HOWEVER, they also say that they would increase revenue by “broadening the tax base”. The only way to interpret this is that they intend to tax low and middle income families who, until now, have no earned enough to qualify for paying federal income tax. Therefore, their stated intent is to cut taxes on the wealthiest Americans and raise taxes on the middle class. You can’t get around that.

By the way, cutting taxes does NOT stimulate economic growth. In fact, quite the opposite is true. Low taxes encourage profit-taking. Periods of higher tax rates show more re-investment. Business owners take less profit out of their companies if they know they’re going to pay higher taxes on that income. In any case, the last eleven years has provided ample proof that tax cuts boost nothing but the wealth of the top 1% of the population. 93% of all gains in the economy over the last two years have accrued to that small group of highly fortunate people.

Romney has also stated numerous times that he wants to increase defense spending by a $1 trillion over the next ten years and $2 trillion over the next 20 years. He would also add more than 100,000 more personnel to the armed forces. He has vowed to do this despite the fact that the Pentagon has said it doesn’t need the additional people or extra money. Romney just wants to be seen as a pro-military leader by his right-wing base. It is a completely disingenuous position.

All that said, I also have doubts about President Obama’s debating skills (although I don’t know what that has to do with being President of the United States). I wish he had been more energetic and assertive in the debate. I also wish that he called Romney on all of his lies and half-truths. That was a major mistake.

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How to Slash the Deficit Without Slashing Our Own Throats

April 9, 2011 at 10:10 pm (Uncategorized) (, , , , , )

Making large spending cuts while the country is still struggling to climb out of the deepest recession since the Great Depression is NOT a smart idea. Here’s what I would do:

1. Cut defense spending immediately by 5%, and 10% over the next 5 years, by closing a few bases in Europe and Asia. Make all defense contracts subject to mandatory competitive bidding, and empower the OMB to audit all defense expenditures. Eliminate the development and production of out-dated weapons systems. (Secretary Gates has already endorsed most of this).

2. Institute means-testing for all Medicare recipients. Benefits should decrease as our income increases. Giving free medical care to a millionaire who makes almost $3,000 per day is obscene. Everybody should get some benefits, but we have to stop throwing money at people who are made of money. (Leave Medicaid alone! The poor, low-income families and the elderly are having a difficult enough time already). Finally, empower Medicare administrators to negotiate drug prices with Big Pharma. This would save seniors and the Medicare program billions of dollars, yet Republicans in Congress are obstructing any move to do this.

3. Raise the retirement age for Social Security to 68, not 70. The current retirement age is not reflective of the world we live in, with people living and working longer. Payroll deductions for Social Security should NOT have a cap for wage earners. Lower the annual tax to 5% from 6.2%, but remove the wage base cap (currently at $106,000) for employees. Retain the wage base cap for employers so that their matching contribution requirement ends when the employee reaches $110,000 in gross wages. Finally, take Social Security out of the General Fund, so that it can’t be stolen from again.

4. Do not touch discretionary spending, which only accounts for about 16% of the budget. I would actually increase this percentage, so that it includes infrastructure projects that would create jobs. All programs should, however, be subject to annual audits to ensure money is being spent where it’s supposed to be spent and there is no fraud or waste.

5. Implement a transactional tax on hedge fund managers and Wall Street speculators that will bring their real tax liability up to the top bracket where they belong. Some of these people are earning 12-figure incomes, contributing nothing to the economy but higher costs for commodities, and their current tax rate is about 11%.

6. Eliminate the tax loophole created by George W. Bush in 2005 which allows corporations to write-off the cost of training foreign workers in this country, as they out-source American jobs to foreign countries. This loophole actually incentivizes out-sourcing.

7. Keep current individual tax rates where they are for people earning between $50,000/year and $300,000/year. Those earning less should also be given a ‘payroll tax holiday’ for the next two years. Those earning more than $300,000/year should see an increase in their tax rate from 35% to 39%. (These rates can all come down over the next 10 years if we’re serious about ending many of the tax avoidance loopholes in the tax code).

8. Leave corporate taxes where they are, but provide some tax incentives for companies who move their manufacturing facilities back into the US. We have lost nearly 60,000 factories in the last decade and our economy will not fully recover until we can get manufacturing back on its feet in this country.

9. Raise the Estate Tax on estates valued in excess of $10 million. Estates valued at less than $2 million should pay no Estate Tax.

10. End the subsidies to the wealthiest industries on the planet — big oil and big agra. It is absurd that US tax payers are helping to finance the operations of these mega-businesses).

None of these ten ideas alone is perfect, but we have to do something. I believe that taking the above ten steps would drastically reduce our deficit with the least amount of pain for everybody. More importantly, it would serve to buttress the middle class, which is the engine that drives our economy.

In concert with these ten steps, we need to address the trade imbalance and its underlying causes. India and China in particular, need to implement worker protections and an acceptable minimum wage. China needs to stop manipulating the value of its currency and subsidizing its so-called ‘private industry’, so the playing field is more level. Otherwise, their exports should face tariffs.

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Sarah Palin: Why Is She Still Important?

February 11, 2010 at 2:22 am (Uncategorized) (, , , , , , , , , , , , , )

It seems that some politicians are given a free-pass when it comes to even the most basic knowledge. Take Sarah Palin. If you look at the list of statements that this woman has made over the last 3 years, it is mind boggling that anybody would ever want her as the leader of the free world. Let’s review her history here:

This is the same woman who told Charlie Gibson of ABC in a nationally televised interview that her foreign policy expertise included the fact that Russia could be seen from an island off the coast of Alaska. This, I might add, is an island that Palin had never once set foot upon. “You never know when ole Mr. Putin is gonna come flyin’ over here…”. Yep. She actually said that.

When asked which periodicals and publications she has been reading to keep up on national and world affairs, Palin told Katie Couric that she reads “them all”. Whenever Palin is baffled by a question she uses her standard “I like ’em all” answer, and that’s what she did. To this day, we still do not know what Palin reads to keep informed about national issues. Until four years ago, she never even had a passport and had never left the United States.

Sarah Palin has stated publicly that she does not accept the theory of evolution, not even understanding the meaning of the term “theory”, and that she believes in a literal translation of the Bible. This means Palin believes mankind walked alongside living dinosaurs and that the world is only 6,000 years old. Of course, when asked which book of the Bible she likes most, she would no doubt say, “I like ’em all.” Certainly, people are free to believe whatever they like, but Palin’s rejection of the scientific method hardly makes her the ideal leader of a nation of 300 million people which share a variety of beliefs.

When asked by Glenn Beck who her favorite Founding Father was, Palin stumbled with the question, then said– you guessed it– “I like ’em all.” When pressed by Beck, Palin said she liked George Washington the most, not knowing that Washington was a general and not one of the Founding Fathers. Furthermore, in her stone ignorance, she chose a man who actually favored a strong central government as well as the formation of a national bank. In other words, George Washington stood for everything that Palin says she is against. More recently, when asked what notable role Paul Revere played in the Revolution, she said he “warned the British” that they couldn’t just “come over here and take our guns…” by “ringing bells” and repeatedly firing his muzzle-loaded flint-lock rifle.

Probably one of Ms. Palin’s most hysterical misstatements occurred during the campaign when she referred to “the great country of Africa”. More recently, she didn’t seem to know why there was a North and South Korea. One has to wonder if she can’t figure out who’s buried in Grant’s Tomb.

During a Tea Party convention, Palin made several insulting remarks about President Obama, one of which accused him of being “a law professor lecturing the American people behind a lecturn using a teleprompter.” Of course, she failed to realize that she was doing precisely the same thing, only she was using the palm of her hand instead of a teleprompter.

What Palin is best known for is her bald-faced lie about “death panels” during and after the health care reform debate. Despite the fact that every fact checking organization had debunked that outrageous lie, Palin has stuck to her guns. Of course, she would never admit that private insurance companies already utilize de facto death panels by denying coverage to people with pre-existing conditions and canceling the policies of people who become ill.

Palin has referred to President Obama on numerous occasions as a socialist, but refuses to provide her definition of the term, no doubt because she doesn’t have it written on the palm of her hand. She doesn’t care that Obama hasn’t nationalized a single business, nor has he put any government employees into the boardrooms. Of course, Palin believes that Obama should have just let the auto companies fail, even though doing so would have caused hundreds of thousands of Americans to lose their jobs and essentially turned over that industry to foreign manufacturers. In recent weeks, we have learned of the remarkable rebound of the US auto industry and the fact that they have repaid most of the funds that the Obama administration LOANED to them. Not surprisingly, you won’t hear Sarah Palin talking about that.

In a closed meeting at the White House, Rahm Emanuel told a group of liberal activists that their idea to air attack ads targeting conservative Democrats who were against the health care reform bill was “f’ing retarded”. Palin, who has inserted her special needs child into the political arena before, demanded that Emanuel immediately resign. Then, when Rush Limbaugh said on national radio that all Democrats are retards, Palin went on FOX News and defended Limbaugh’s use of the word and his characterization of all Democrats. While his use of the term was insensitive and inappropriate, Emanuel said that an idea was “f’ing retarded”, while Limbaugh was using the term to describe a group of people he doesn’t like. But, according to Sarah Palin, Rush Limbaugh should get a pass. This could be a blatant case of hypocrisy, but it could also be that Palin is just too dim to understand the difference between what Emanuel and Limbaugh said.

Sarah Palin never speaks in specifics and is always on the attack, never offering a single constructive alternative. Why? Because she doesn’t know what the specifics are. It is far easier to make insinuations, and attack with empty-headed sarcasm than it is to develop your own well thought out ideas and articulate them in a comprehensible manner. We all get a good laugh about Sarah’s gaffes, but the time to stop laughing has come. This is a person who is building a political movement on the cult of her personality. She is a classic fascist masquerading as a populist who has managed to win the hearts and minds of far too many Americans. Even if she never ran for president, her influence on our political process and election outcomes could do great damage to the country.

Elia Kazan, the Academy Award-winning film director, said many years ago that the greatest danger to our democracy would be having person of no ability or intellect elected to high office based solely on their personal charm.

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Is the opposition to President Obama driven by racism?

September 16, 2009 at 11:25 pm (Uncategorized) (, , , , , , , , , , , , )

I would have to agree with President Carter’s assessment, when he says that racism lies at the core of the current venomous attacks on President Obama. (To be clear, Carter said that he was talking about a “radical fringe element”, rather than all people who oppose Obama’s policies). While the extreme language and behavior of many people involved in the Tea Party movement in addition to the rantings of people like Glenn Beck and Rush Limbaugh has been veiled in manufactured political causes, they are clearly driven by anger that a black man is sitting in the White House. At best, they are attempting to tap into the undercurrent of “white man’s anger”, especially in the southern states, in order to score political points. We also have people like Michelle Malkin attacking Mrs. Obama, and a pastor in New Mexico preaching that the President and his family should die and go to hell. All of this is symptomatic of a concerted effort to de-legitimize Barack Obama’s presidency before he has even been in office for one year.

When people refuse to listen to reason and continually ignore the facts as they are presented to them, then hallucinate nefarious schemes such as death panels, secret nationalist armies, and concentration camps for political enemies, we are witnessing the kind of ignorance and fear that are the building blocks of bigotry. When people scream, “I want my country back!”, they’re really saying that the President of the United States isn’t a true American. When they walk around carrying signs that say “Bury Barry with Teddy” and hold up forged Kenyan birth certificates, they’re saying that they truly believe the President is the enemy. One man even stated on camera at a Tea Party rally that Obama was more dangerous to the United States than Osama Bin Laden. This is not rational behavior, and it’s edging closer to sedition every day.

This monster has been created by the right-wing of the Republican Party and the Tea Party movement, whose organizer is a blatant racist. On his website, he refers to the President as an “Indonesian, Muslim communist thug”. Like any good propagandist, he hand-picked each of those words to push the most sensitive buttons without regard to the fact that none of them have a thing to do with reality. Glenn Beck, Rush Limbaugh and Michelle Malkin are the incendiary personalities who are inciting these crowds with their strident and almost comical accusations. At a certain point, this country is going to have to deal with them, just like it dealt with Joseph McCarthy, another political opportunist with a sick agenda.

If you think Joe Wilson would have yelled “You lie!” to a white president, you’re on crack. Mr. Wilson, a member in good standing of the Sons of the Confederacy as well as other organizations with ties to white supremacists, is an overt racist. He has also been a staunch proponent of making the Confederate flag the standard for his state. On top of violating decorum during a presidential appearance before a joint session of Congress with his Tourette’s-like outburst, he was just plain wrong. All five of the reform proposals currently before Congress contain ‘verification’ provisions. Just because those provisions don’t go as far as he would like them to go does not mean they are not there. The Republican amendments which were voted down required that emergency room doctors and nurses refuse treatment until an incoming patient’s status had been verified by some unnamed bureaucrat. Imagine a situation where a bleeding child who has been hit by a car is brought into ER and somebody who looks like Joe Wilson steps in and says “Don’t touch that child until we make sure he’s not another Mexican trying to get free health care.” Preposterous.

The longer that the Republican Party remains in denial about the emergence of racism within its own ranks, the sooner this country is going to have a one-party system. The problem is that the GOP actually relishes this grotesque phenomenom because it is energizing its notorious right-wing base and creating doubt among more impressionable independents. For that reason, you will never hear Michael Steel admit that there is any racism going on in the Republican Party and that all these lunatics at Tea Party rallies are just hard-working Americans who hate President Obama’s policies. Of course, we’re talking about the policies as characterized by the likes of Glenn Beck, Rush Limbaugh and Michelle Malkin.

Here is another interesting and eye-opening video which compares Canadian health care to the U.S.:

http://www.youtube.com/watch?v=x3EoziMcFvE&feature=response_watch

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