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Monday, July 3, 2017

How America Co-opted the Future of Generation X and Y and How We Can Fix It-An Examination of Social Security

Bernie Sanders was no fluke, his appeal to the youth of Generation Y and to some extent Gen Xers is marked by real evidence showing how their futures have been muted by financial decisions made by Congress. The President of the nation, theoretically, is elected by us, although recent elections have shown the arcane electoral vote, meant to secure the democracy when many voters were illiterate, has called this into question. It turns out the electoral college is just another version of the “old boys club”. This article examines the contract for Social Security which the United States has made with its working class and what that means for the future of your children and grandchildren, in other words, those whom will be paying the tab.

Social Security
Social Security Taxes Paid by your Grandparents versus Workers of Today

Payroll tax rate is based on wage income and is split evenly between the employer and the employee
1% capped at $3,000; Medicare did not exist then
5.85% of wages, capped at $16,500; Does not include the Medicare tax
12.4% of wages, capped at $127,200; Does not include the Medicare tax, which is separate

When Social Security was enacted, it was meant as a pension for those whom would otherwise be destitute. Retirement age, at which a beneficiary could start to draw benefits was age 65, when the law was enacted on August 14, 1935, by President Franklin Roosevelt. [2] Life expectancy at the time was 62.9 years, so as you can see, only the lucky ones received any benefit. Fast forward to 2017 and life expectancy is dependent on where you live, and other factors, some women will live past 86. But the mean life expectancy for all people living in the U.S. is 79 years.[3] This ranks the U.S. 49th in the world, below all countries with national health plans and at the bottom of all industrialized countries.  South Korea, Jordan, and Hong King residents all live longer than Americans living in the U.S.

Currently, residents whom have met the minimal ten years of contributions under include-able wages are eligible to start drawing Social Security benefits as early as 62, with a reduction, or age 66 ½, depending on their birthdate. The government has an incentive, of 8% per year in increased benefits to delay until age 70.

Income Comparison
Mean income is the earnings amount by which an equal number of workers are above and below this value
$1,368, with an unemployment rate of 18.26% and no unemployment benefits[4]
$12,224, with an unemployment rate of 7.5%, with unemployment benefits
$44,980, [5] with an unemployment rate of 4.3% as of May [6]
Though the unemployment rate is certainly low in 2017, it was just a few years ago when the nation’s banking system collapsed due to junk bond deals packaging subpar mortgages as investments, and provided to people who could not afford them. This fraud was conducted by all levels of banks (Lehman Brothers) and the insurance industry (AIG), many of whom went bankrupt, but not until thousands of American homeowners lost everything first.

Real Purchasing Power Adjusted for Inflation
Purchasing Power-to maintain the same value this is how much you would need
Earnings needed to maintain equivalent value of mean wage in 1940

Though gross wages have increased over the years, real purchasing power has not kept up, as this table shows. Americans are only making a little over twice the 1940 per worker mean wage, when you adjust for inflation. The mean wage for all working Americans, which isn’t the average, but the midpoint, with an equal number of workers falling below the standard and above it, is currently $44,980 annually. So, for 77 years, this is not a lot of progress for workers, mainly because they have fallen behind since the 1970’s. Rising productivity of American workers has not resulted in a commensurate rise in wages for most workers, so the Republican trickle-down theory hasn’t worked. Real rise in wages, adjusted for inflation has been stagnant since 1980, the Reagan era.

Change Social Security to a Fairer More Secure System
Currently, a worker in the United States must accumulate forty quarters or ten years with earnings of at least $1,260 a quarter or $420 a month, to be eligible to apply for full social security benefits, depending on their age. Wow, what a deal, all you must do is work for a week each quarter, based on the current U.S. wage and you will have a pension! We can all think of our aunties and grandmas who took advantage of this benefit, by working part-time low-wage jobs, not because they needed to, but for spending money. I can’t think of any other part-time low wage job that comes with a lifetime pension.
Change #1 Social Security Benefits should be based on fulltime earnings for at least 10 years, not part-time. Working part-time does not guarantee you a pension.
Change #2 Social Security should pay more to workers who work longer, for example, workers who work unceasingly for 40 or 50 years, should get a larger benefit than those who work only 10 or 20 years, it is the time value of money. This would change the incentive from “do your bit to get minimum benefits’, to contributing longer for a proportionally greater earned reward.  Though currently, Social Security offers a sizeable benefit increase to those who wait until maximum retirement age of 70, it does not look at the length of service.

Spousal benefit provisions under Social Security allow full benefits to inure to persons who marry multiple times, ala Donald Trump. Though the worker’s tax contribution to the social security fund was capped, apparently the benefits which may be paid out are not. For example, a spouse, either male or female can elect to claim 50% of the partner’s social security benefits. Essentially, this means the value of the Social Security payout has increased by 50%, without paying additional taxes. And here is the real pot sweetener, anyone who has been married for ten years and has not remarried before age 60, gets this extra windfall election. The ex-wife can claim a benefit of 50% of her husband’s social security benefits, years after the divorce, but this doesn’t reduce his take, it is just a bonus to her from the federal government. And, the current wife (male or female) is still eligible to claim her share of the spouse’s social security pay out as well.
Change #3 You are welcome to marry as many times as you can stand, but the government is under no obligation to support your multiple wives/husbands. The total spousal benefit needs to be revised and social security benefits paid to ex-betrotheds should come out of a limited benefit based on the working spouse’s contributions. In other words, if $300,000 is allocated for spousal benefits, that amount must be allocated between all the former “love-of-my-life’s,” not increased exponentially because of salacious decisions.

Survivor benefits can be collected by widows or widowers as early as age 60 and this means, if your spouse has died and was collecting Social Security or was eligible to collect, you can elect to collect full benefits, based on your spouse’s social security. Later, you can decide to switch to your own benefit, if it would pay more money.
Change #4 This seems like gambling against the house and holding the aces; once you start drawing your social security benefits, you don’t get a do-over. If you select your half of his benefits at age 60, that is what you get.

Survivor benefits for children, are only payable for unmarried children until age 18 or 19, if they are still in high school. Children of a disabled or deceased social security participant are eligible to receive benefits if the parent had paid enough into the system, which we discussed, is a mere ten years of earnings. Since it sucks to lose a parent, or to have a disabled one, let’s leave this as is.

Social security taxes have doubled in the last forty years and are not keeping up with the benefits which will be paid out to baby boomers, whom are now starting to enjoy their unreduced benefits. Since the younger generation will most assuredly be expected to pay higher taxes for Social Security and of course, Medicare, we need to shore up their future. It is time to have a national pension or Individual retirement account for those under age 45. Designate part of what they contribute to Social Security to their own private account, ideally 50%, but I will leave that up to U.S. Treasury and Social Security Administration to discern.  The money contributed to Social Security, would not be able to be borrowed against and hence, safe from creditors, could not be used for medical care, and would not be accessible until age 62.
Change #5 Let Gen Xers and Generation Y start their own government protected individual retirement accounts. At least they will have some money for their future and they won’t have to feel so bad about paying those extra taxes for boomer benefits.

It is time for older Americans to wake up to the debt we have left our youth, who will be paying for our bad decisions for a lifetime. If I hear one more senior citizen, enjoying their social security checks and Medicare complain we can’t have socialism, I am going to remove your dentures. And this is the healthpolicymaven signing off encouraging you not to sign blanket releases when you are admitted to a hospital, please add the line, “I agree to pay for services of in-network providers,” as recommended by Dr. Elizabeth Rosenthal in her book, How Healthcare Became Big Business and How We Can Take It Back.”[7]

This article was written by Roberta E. Winter, a freelance journalist and author of

Sunday, May 21, 2017

Why the Republican Healthcare Plan Won't Save You Any Money

None of the Republican proposals for healthcare include a single cost or quality requirement for payment to doctors, hospitals, or even insurers, which will add rocket fuel to the fee-for-service payment system which is the bane of U.S. healthcare. This payment method, which originated with the founding of Medicare in the sixties, is one of the main reasons why the price for health services is so much higher in the U.S. than any other country. Essentially, there is no budget and all healthcare providers are paid on volume, with the exception of some primary care folks.  You have undoubtedly read the stories of patients being charged for services by surgeons who didn’t even perform the surgery, which reflects the factory mentality of the surgical suite and the outsized incentive to make more money. The delivery of health services or improved health to the patient is often a bi-product. Tom Price is the Trump Administration appointee for Secretary of Health and Human Services, which oversees all policy making for healthcare, any efforts to assess and improve quality, most funding for medical research, and patient safety programs for the country. He is on record questioning the value of Medicare’s Demonstration Projects, whose sole purpose is to find ways to improve health and reduce costs as clinically appropriate. Without the requirements of the Affordable Care Act, for price reporting transparency for medical device companies and other suppliers, as well as mandating that insurers participating in government funded programs spend at least 85% of funds collected on program benefits for enrollees, there will be no incentive for any of these health sector profit-takers to lower their costs or improve quality. Will the Republicans also axe the successful Accountable Care Organization incentives for systems which demonstrate they are delivering high quality health care?
CMS-the Only Agency with Enough Price, Quality, and Enforcement Power to Fix Healthcare
The Centers for Medicare and Medicaid is the only agency with enough regulatory power to enforce both price and performance standards for the national healthcare system. Dr. Tom Price wants to neutralize CMS and loosen oversight for the healthcare industry. As I illustrated in my 2013 book, Unraveling U.S. Healthcare (Winter R. E., 2013), national healthcare when viewed by outcomes is not better here, just more expensive. According to 2017 data from the Henry J. Kaiser Family Foundation, the U.S. now spends $9,451 per capita for health care. (Cox, 2017) Most of Europe spends half of that per person per year. And I am not talking about insurance premiums, but the total, all-in cost of health care. Only three countries spent more than $6,000 in this time-frame, the wealthy triumvirate of Norway, Switzerland, and Luxembourg. How can the U.S. still claim that covering everyone for health care is too expensive when all the industrialized countries are doing that and spending much less?
American Health Is Declining
According to a recent analysis by the Kaiser Foundation, the U.S. is at the bottom of all industrialized countries for life expectancy and we spend 50% more than most of these countries. (Sawyer, 2017) People live the longest in Japan with an average life expectancy of 83.7 years, followed by Switzerland at 83.3 years, and then France at 82.8. The U.S. comes in at 78.8, this despite spending 50% more on health care. In fact, life expectancies are going down in the U.S., which is still one of the richest countries in the world. This should raise alarm bells, yet the ill-informed Republican Congress apparently believe that reducing access to health care by gutting Medicaid, removing basic benefits like maternity care (U.S. also has one of the highest maternal death rates in the developed world), and of course, gutting mental health services will improve the situation. I remember when smoking die-ins were de rigueur, perhaps we need to stage a national die-in to demonstrate the impact of the latest Republican effort to gut healthcare.
Systemic Overcharging Contributes to the High Cost of Healthcare
Why is overcharging tolerated in healthcare? People aren’t willing to spend 50% more for their houses or their autos? Americans are not getting comparatively better health for this 50% higher healthcare spend, but many companies are getting very rich because of it. In 2013, I posted an article on orthopedic surgery for a hip replacement in Belgium, which cost $16,000 versus $60,000 in the U.S. and the entrepreneurial American who chose to fly to Belgium for his uninsured treatment because he still saved money. (Winter, 2013)
Why Increased Private Sector Involvement and Reduced Regulation Won’t Work
As a participant in the Lown Institute’s Right Care Conference this month[1], which focused on educating clinicians and the public about cost effective treatments which improve health, I had the pleasure of listening to Jeffrey Sachs, professor of Health Policy and Economics at Columbia and a United Nations Adviser, the day the Republicans came out with their plan to defund Medicaid. Dr. Sachs has studied microeconomics and unequivocally stated, “Pure market economics in healthcare does not exist. Corporations are not the guardian of public health.” Consequently, the expectation that more uncontrolled private sector involvement will generate a better more efficient healthcare system is ludicrous. The U.S. healthcare system was created for profit maximization not maximum efficiency or efficacy. The idea that market economies are the solution to all public services has been proven false time and again, for national security, the interstate highway system, regulation of drugs and medical treatments, and the safety of our food supply. The scariest weapons in the world are not the missiles of North Korea but chemical weapons, whose carnage the world witnessed in Syria, and even worse, the biological ones. Trump, the anti-globalist doesn’t seem to understand that the World Health Organization provides surveillance and communication of disease and public health epidemics to aid in curtailment. His Budget Director’s proposed 20% cut to Health and Human Services would impact our health safety. Our survival as a species and a planet depend on our cooperation, funding, and heeding the advice from organizations which are providing this front-line work.
Without Price Transparency Patients Are Not Empowered
As the American healthcare system includes a healthy private sector contribution, there is an expectation of a competitive environment, but in healthcare this does not exist. For example, an oversupply of high tech medical technology increases the cost of care and does not lower insurance premiums or hospital charges. The burden of paying for duplicitous equipment is born throughout the health system by the premium payers for insurance and those who use the health services. A healthy marketplace requires symmetrical information, meaning there is equal access to price and quality information for all participants. In the U.S. insurance price information is available, but consumers must go to a lot of work to assess reliable scientific health care quality data. Specious clinical results which do not improve population health are published all the time by drug companies, hospitals, and medical suppliers through direct-to-consumer-advertising. Hospital services are dominated by a handful of huge corporations as is the insurance industry. The profit motive is so enticing in healthcare that the nonprofit Blue Cross Blue Shield entities became for-profit cash machines years ago. This decision did not lower the cost of your health insurance or your health services. Equal access to information, meaning, the healthcare purchasers have access to actual price and quality information is impeded by organizations which are not required to provide this information. At least the Obama Administration required companies to report wholesale and retail price information, as the start toward building a database for price transparency in U.S. healthcare.  Cardiac device companies have successfully fought to prevent the public from learning how much we are overpaying for their heart valves. This phenomenon is very different in other countries, like France and Australia where price lists must be posted. In the U.S. if you ask for the cost of your scheduled procedure and hospital charges, providers will typically not be willing to give you that information. Insurance companies would seem to be in the best position to communicate to their customers what they can expect to pay for a procedure at a facility, because they negotiate price with all their contracted providers. Private sector companies are investing in price detection but their services are not readily available to the public on a national scale. The mega healthcare conglomerates, including medical device, pharmaceutical, and skilled nursing facilities are by and large for-profit entities and they have no interest in delivering unprofitable care. Dr. Sachs also stated, “Anti-retroviral drugs to fight HV cost $25,000 in the U.S. and $160 everywhere else in the world.” Drug distribution and patents are based strictly on profit maximization, not getting the most benefit for the health system.
This Country Is Making You Sick
The U.S. has the highest income inequality in the developed world, which means there is a decreasing middle-class and growing poverty class. About 14% of all people in the U.S. live in poverty, but 25% of all children do. Yet the Trump administration wants to cut school lunch programs, Head Start, public school funding, and access to health care for these children, while the top 5% expands its wealth exponentially.  This worrisome trend is reflected in the ill health of our people as evidenced by the epidemic of suicides and opioid addictions. As I write this column within the past week two teenage boys chose death-by-cop as their suicide method, because in this country, you can have a fake gun, have committed no crime, and still be reasonably certain you will be murdered by the police. In the 1990’s Congress reduced funding for gun violence research, cutting 2.6 million from the Centers for Disease Control and Prevention’s budget. Congress also passed a ban on any research which would advocate or promote gun control, because of alarm over a 1993 study which analyzed risks of keeping a firearm in the home versus the benefit for personal safety. (Sudermann, 2017) Now, gun violence in the U.S. kills as many people as sepsis infections. We treat infections, yet our elected officials lack the backbone to enforce strict licensing and distribution of firearms to protect the public. Under the Trump Administration we can look forward to ever more mentally ill persons obtaining Uzis and the ensuing destruction. Peggy Noonan asserts that societal ills would go away if parents only loved their children more. I can assure you, Ms. Noonan, poor people love their children and it is a herculean struggle for them to make ends meet every day. It should also be noted that the wealthy are just as rife to suicide and drug addiction, so perhaps love isn’t the answer, and informed health and welfare policy making is the solution.
And this is the healthpolicymaven signing off wishing you fully informed consent, and remember, as Dr.  Rosenthal, author of An American Sickness-How Healthcare Became Big Business and How You Can Take It Back (Rosenthal, 2017) recommends, don’t sign generic hospital release forms and do add a codicil which states, “I agree to be responsible for charges for in-network providers.”

This column is completely independent of corporate support and has been since 2007. Roberta Winter is an independent journalist and healthcare writer. She is the author of Unraveling U.S. Healthcare-A Personal Guide, a guidebook to the U.S. healthcare system written expressly for consumers.


Cox, C. (2017). How Does Healthcare Spending In the U.S. Compare to Other Countries. Henry J. Kaiser Family Foundation. Retrieved May 21, 2017, from
Rosenthal, D. E. (2017). An American Sickness-How Healthcare Became Big Business and How you Can Take It Back. New York, New York, USA: Penguin Press. Retrieved from
Sawyer, S. G. (2017). How Does Life Expectancy Compare to Other Countries. Kaiser Family Foundation. Peterson-Kaiser Health Systems Tracker. Retrieved May 21, 2017, from
Sudermann, H. (2017, March 1). Prevention Revisited-A Harborview-based Center Looks for Ways to Prevent Injuries and Violence. Columns-The University of Washington Alumni Magazine, pp. 38-39.
Winter, R. (2013, August 6). Save Money On Your Health Care By Going To Europe. Retrieved from Straight Talk on Healthcare, healthpolicymaven:
Winter, R. E. (2013). Unraveling U.S. Healthcare-A Personal Guide. In R. E. Winter, Unraveling U.S. Healthcare-A Personal Guide (pp. 3-15, 31-38). Lanham, MD: Rowman and Littlefield.

Saturday, April 29, 2017

100 days under the Trump Epoch and what it means for your Health

The first 100 days under the Trump reign have seemed like a thousand years of muffled screams and insults, which at times were hilarious because of the inaccuracies and grammatical errors. However, as William O. Douglas, former supreme court justice, once said, "freedom steals away in the night while we are sleeping." This article reviews the thrust of the Trump Administration and the Republican majority's stabs at "healthcare reform." Round deux, dos, or two, depending on your preference, of the attempt to repeal the Patient Protection and Affordable Care Act has slunk away in the night, lacking the requisite number of votes for approval. However, this latest iteration provides a glimpse at the approach the Republicans will apply to future legislation, in healthcare, and many other programs. Essentially, the R's want to shirk national leadership and have the states assume responsibility for more programs and consumer protections. The only area in which they shrink from this is for gun proliferation, where the Trump Administration wants to force all states to accept looser standards for transporting weapons across state lines, including concealed weapons.
Trump Posturing
Right up until the federal government deadline for shutting down, Trump threatened to withhold the tax credits which provide 20 million middle class and low-income Americans with medical insurance. This is of course, an administrative maneuver to choke the life out of the act, since he hasn't been able to gain agreement from his own party. It should be noted however, that Trump has already cut funding mechanisms which flow to the program, including a 3% tax born by the lucrative medical device industry, which will flow directly to their executives and NOT reduce the cost of your cardiac or orthopedic devices. And of course, let's not forget his forgiveness of the "tanning bed" tax, which has zero health benefits and does contribute to skin cancer. 
Regarding the thousands of people who hate the Affordable Care Act, there are exemptions for those who don't want to participate, and about 20 million folks have made this election or paid the tax penalty. Though the Affordable Care Act is not beloved and is flawed legislation, as they all are, it is still a starting point from which to make further reforms. This chart shows provisions of the act which are now being targeted by the Trump goon squad and what the impact may be on your health care.

Affordable Care Act
Trump Round 2 Health Plan
Protection from Pre-existing Medical Condition Exclusions
Insurance companies are prohibited from denying coverage or reducing benefits to persons with existing medical conditions
The Republicans are proposing that individual states decide how they want to handle insurance offerings to those who need it most-including being able to charge astronomical prices, limit benefits, and deny coverage
Lifetime Limits for Benefits
Insurance companies are prohibited from limiting benefits
The Republicans think states should be allowed to offer restricted programs, contracts with minimal benefits, instead of comprehensive medical insurance
Standardized Benefit Levels Nationally
In the insurance exchanges, participating insurers must offer benefits which adhere to certain benefit designs and guarantees
The Republicans see no advantage in mandating benefit standards and wish to leave this provision up to the states
Protection from Predatory Pricing Based on Age or Need
In the insurance exchanges, there are tiers of rates and people who are in the older tiers cannot be charged more than 3 times the rate of the younger tiers
The Republicans want to allow strict age rating, which means if you are over 50, it will be a long expensive wait until age 65 when you can join America’s national healthcare plan, Medicare
Birth Control Coverage
The insurance exchanges require plans to offer birth control in all plans
The Republicans are opting to use streaming videos of talk show host Alex Jones as birth control
Mental Health Services Coverage
Included under the ACA, as any other benefit
More homeless people, which impacts cities, who didn’t support Trump anyway, so a win for them
Chemical Dependency Treatment
Covered under the ACA, which is critical with the opioid crisis
You are on your own

To all the winners who voted for Trump, stop whining about the millions of engaged citizens who are demonstrating against his horrible policies, the first amendment guarantees their right to free speech, and this is part of a real democracy.
 And this is the healthpolicymaven signing off wishing you all informed consent. Also, TIP OF THE DAY-don’t sign blanket authorizations at hospitals or medical facilities, please add the words,“I agree to pay charges for in-network providers”, which can save you a mint. Those words of wisdom come from Dr. Elizabeth Rosenthal, author of An American Sickness-How Healthcare Became Big Business and How You Can Take It Back. Please do buy and read her book.

Roberta Winter is the author of Unraveling U.S. Healthcare-A Personal Guide, published in 2013 by Rowman and Littlefield.

Sunday, March 12, 2017

Trumpcare Versus Obama Care-What You Need To Know

How the Republican Healthcare Act Compares to the Affordable Care Act

The Republican plan, euphemistically referred to as Trumpcare addresses insurance and not improvements in healthcare delivery. Insurance is NOT health care. This analysis examines how the proposed healthcare plan in House Bill 277 differs from the Affordable Care Act, known as Obamacare. For information on ACA improvements in health care at the patient level, refer to the link below.[1]  This article cites credible sources from nonprofit entities or government agencies and only facts are used, not false proclamations.


Medicaid Coverage is medical insurance for low-income folks

Eligibility Standards
Expanded eligibility for Medicaid to 138% of the federal poverty level; 32 states opted to expand coverage, increasing access to healthcare for 11 million people.[2]
Beginning in 2020, repeals the Medicaid expansion, allowing existing Medicaid participants to remain, but with the inability to re-enter later if you lose your eligibility; Millions would lose their medical insurance. (Gunja, 2017)
Mental Health Benefit

Expanded to include mental health parity, to increase access to health treatment for mental conditions under the essential benefit provisions of the ACA. (Kirsten Beronio, 2013)
Insurance companies would no longer have to offer mental health benefits under insurance contracts.
Substance Abuse Treatment

Plans were required to offer coverage for substance abuse treatment, comparable to other illnesses and it is estimated 5 million people have used this benefit. (Kirsten Beronio, 2013)
Insurance companies are not required to offer treatment for drug addiction, which is problematic given the national crisis in opioid addiction, currently killing 91 people a day. (Centers for Disease Control and Prevention, 2016)
Employer Insurance

Required employers to offer medical insurance within standardized benefit levels, or pay a fine.
Employers will no longer be required to offer medical insurance for their employees and no fines will be levied. Small business tax credits, to help businesses offer medical insurance are cancelled in 2020.
Impact on Individuals in Insurance Exchanges
Required pooled rates, which were spread across age bands, not individual levels; creating more affordability. (Jost, 2016)
Insurance companies can age rate, to increase pricing toward older participants (those most likely to need more health services). Cost sharing provisions which helped low income people are eliminated.
Taxes to fund the plan
Follow the link to a previous article which detailed the taxes.[3] Most sectors of the healthcare system contributed to taxes to fund the provisions of the Affordable Care Act which is self-funding.

Would eliminate most of the taxes except the “Cadillac Healthplan Tax”, lower capital gains for the top 2.5% of income earners, and charge all employees covered on insurance plans through their employers, a Value-Added Tax (like the Canadians charge on services).
Women’s Healthcare

Mandated insurance plans cover birth control and women’s gynecological exams annually.
Defunds all Planned Parenthood Services and removes the requirement to provide wellness services or birth control.
Financial Impact on Individuals
Older low income people had greater subsidies so they could buy medical insurance.
Older low income folks will pay thousands more per year for medical insurance. Young people will pay less for insurance, but since there are no penalties for not participating enrollment will decline, eroding the overall viability of insurance exchanges.
Employer Provided Medical Plans
Employers can deduct the full cost of their medical and other benefit plans and employees are not taxed on these benefits.
Eliminates the tax advantage for employers which will cause the cancellation of many health plans across the nation because this is a very expensive benefit for employers to offer. Example, your employer pays $12,000 in insurance plan premiums for you, these would now be taxable as income to the employee and nondeductible to the business.
Individual Penalties for Not Participating

Tax Laws
Proof of insurance is required at income tax filing. A tax penalty up to $695 per adult ($2,085 family) is due unless you qualify for one of the many exemptions, which include your inability to afford insurance.
No requirement to have medical insurance, but if your coverage lapses, you will pay a penalty (up to 30%) upon re-enrollment regardless of your income. The penalty would be meted out by the insurance company.
Medicaid Funding
Affordable Care Act provides additional subsidies to states for the expansion of Medicaid, to increase insurance coverage and access to medical care across the nation.
Republican plan wants to cap any federal Medicaid contribution to a flat amount per person, without cost-of-living increases and not based on actual plan costs.

A quick analysis of this doomsday health insurance scheme, eliminates most incentives, especially for the bottom 25%-of-income-households and a swath of the middleclass, to obtain medical insurance. By removing the tax incentive for employers to provide health plans more Americans will lose medical insurance through their employment, throwing more people into the chasm of the uninsured. By removing the tax credits for small firms, fewer of those will be able to offer medical insurance to their workers. And the piece de resistance of this Trump sanctioned health plan is to further destabilize the insurance exchanges, by removing the accountability requirement that residents have medical insurance. Plus, allowing the insurance companies to eliminate or reduce specific medical conditions will harm treatment for public health needs. Older individuals will face steep premium increases as the Republican plan allows insurance companies to charge older Americans up to five times what they charge the younger ones. In other words, back to business as usual for the insurance industry, where they can eliminate an entire “class” of people from their contracts and of course, charging those most in need significantly higher premiums.

Finally, there isn’t one thing about this “plan” that addresses the improvement of health care, lowers the cost of your health care treatment, or encourages transparency and accountability from any of the price gouging suppliers. More to come on the provisions which will impede consumer protections and create road blocks on price and quality transparency for consumers. Of course, can we really expect anything else from an administration which felt ethics classes were unnecessary, and refuses to allow adequate time for public comment on a bill which would be so harmful to people?

For the best interactive tool to see how you would fare under the Republican Health Plan, follow the link below to the nonprofit, Kaiser Family Foundation site and search for your age and county to get your tax credit information. The Republican plan only provides tax credits based on age, not on income, with a phase-out at $75,000.[4]

And this is the healthpolicymaven signing off wishing you fully informed consent for any medical procedure, contract, or act. Roberta E. Winter is a former insurance broker and healthcare consultant,  who has been devoted to healthcare reforms since 2002 and is the author of .


Centers for Disease Control and Prevention. (2016). Drug Overdose Deaths Continued to Increase in 2015. Health and Human Services, Centers for Disease Control and Prevention. Centers for Disease Control and Prevention. Retrieved March 12, 2017, from
Gunja, S. R. (2017, March 7). Why Millions Would Lose Coverage Under the Medicaid Expansion Changes in the House Affordable Care Act Repeal Bill. To the Point-Quick Takes on Health Care Policy and Practice. Retrieved March 12, 2017, from
Jost, T. (2016). Affordability: The Most Urgent Health Reform Issue For Ordinary Americans. Health Health Affairs . Retrieved March 12, 17, from
Kaiser Family (2017). Tax Credits Under the Affordable Care Act Versus the American Health Care Act. The Henry J. Kaiser Family Foundation. The Henry J. Kaiser Family Foundation. Retrieved March 7, 2017, from
Kirsten Beronio, R. P. (2013). AFFORDABLE CARE ACT EXPANDS MENTAL HEALTH AND SUBSTANCE USE DISORDER BENEFITS AND FEDERAL PARITY PROTECTIONS FOR 62 MILLION AMERICANS. Health and Human, Office of the Assistant Secretary for Planning and Evaluation. U.S. Department of Health and Human Services. Retrieved March 12, 2017, from

Wednesday, February 15, 2017

Expected Program Cuts to Affordable Care Act and Federal Budget Impact

Orthopedic surgeon, Dr. Tom Price is now in charge of Health & Human Services and here is an analysis of the laws he may try to dismantle, programs which could lose government support, and the ensuing federal budget implications. This article is based on actual facts, not “alternate facts” which are popular with the Trump Administration.
Budget Implications
The Patient Protection and Affordable Care Act has been a revenue generator, while also providing medical insurance for 20 million low income people and has helped to reduce the federal deficit. (, 2017) According to the Office of Management and Budget (OMB) and the Joint Committee on Taxation (JCT), repeal of the Affordable Care Act would cause the federal deficit to grow by $137,000,000,000 by 2025. (Congressional Budget Office, 2015) That’s right, a repeal of the ACA would increase the deficit by 137 billion dollars.  Here are some of the provisions which have generated money for the government, which are likely to be repealed by the Republican Congress under the Trump Administration.
Pay or Play-Taxes generated from income tax filers who did not have an exemption to the requirement for obtaining medical insurance and are required to pay a tax penalty.
Luxury Plan Tax-This tax is applied to health insurance plans which cost more than twice the national average for an enrollee.
Insurance Company Tax-Insurance companies pay a premium tax which goes into the fund to pay for medical insurance for low-income residents and the provisions of the Affordable Care Act.
Medical Device Tax-Orthopedic and cardiac device manufacturers have been required to pay a 2.9% tax on the cost of the device, which funds provisions under the ACA including healthcare for low-income people.
Estate and Trust Tax-This tax applied to undistributed net income, which affects larger trusts, and is 3.8% of that income.  Again, the money goes toward health insurance subsidies for low income persons.
Employer Tax-Failure to offer minimum essential benefits in a health insurance plan will generate a tax, up to $3,000 per effected employee.
Medicare Payroll Tax Increase-The payroll tax used to fund Medicare, was increased by .90% (less than 1% not 90%, if Sec. of Education DeVos is quoting this). This tax is paid equally by the employee and employer and is used to pay for Medicare programs. Don’t kid yourself, Congress will never reduce your payroll tax as this is necessary to shore up Medicare.
Medicare Changes from the Affordable Care Act
Most of the Centers for Medicare and Medicaid(CMS) changes under the ACA involve improving health quality (clinical quality based on patient results) and transparency (in terms of payment and performance). Will these programs also be terminated under HHS Cabinet Secretary Price?
1.       Subsidies for Medicare Advantage (HMO) payments based on counties with a higher density of low income residents-This benefits rural areas as well as the urban poor.
2.       Health care quality rankings impact how much the facilities receive, as well as the Medicare Advantage enrollment population. This is a pay-for-performance initiative.
3.       Insurance companies selling Medicare Advantage Plans must use 85% of annual collected premiums to pay for enrollee claims and plan services, which caps opportunistic accounting charges which contribute to inflated premiums. Insurance companies should be able to administer their plans for 15% as Medicare does it for 6%.
4.       Designating medical homes for patients, is a patient management tool, and has been shown effective in care management, especially for diabetes and other chronic diseases.
5.       Mandatory 90-day review period before the government will pay for durable medical equipment, which is frequently marketed to senior citizens without regard to efficacy or best fit analysis.
6.       Fraud Detection-A special commission in Health and Human Services was established to compare tax records to aid in identification of criminals who are stealing money from our government through fraudulent claims, etc.
Medicaid Changes from the Affordable Care Act
Under the Trump Administration many programs impacting low-income Americans are likely to be modified, reduced or cut and here is the list:
1.       Expansion of Medicaid to include all low-income people, not just children. This was modified through a court order and now applies to 33 states which opted to expand their Medicaid coverage, thus reducing stress on state health systems. Will these states lose the federal matching money they are currently receiving for providing this coverage for low income residents with incomes within 138% of the federal poverty range?
2.       State employees became eligible to enroll their children on the Children’s Health Plan (CHIP) because of the Affordable Care Act, will this be repealed?
3.       Free standing birth centers, such as midwifery and other women’s health facilities, such as Planned Parenthood, became eligible to receive Medicaid funding for additional services under the ACA. Congress has already indicated a desire to defund Planned Parenthood, but what about the other facilities under this provision? This means program cuts for preventive care for women. I guess Trump expects women to build a wall around the uterus, just like Mexico.
4.       Creation of Medical Home designations for patients with at least two chronic conditions, which provides funding for better care management. Participating medical facilities received additional compensation to assume enhanced care coordination through the medical home provisions. Will community health organizations lose this funding?
5.       Hospital Safety-net Demonstration Project-This is an initiative involving several hospitals to identify vulnerabilities in hospital systems across the nation, which are primarily urban trauma centers, to prevent hospital closures. Tom Price has said he does not favor the Centers for Medicare and Medicaid Demonstration Projects. (Pear, 2016)
6.       Greater mental health treatment funding for hospitals with a significant population of indigent patients (urban trauma centers) was part of the ACA. Will there be funding cuts for vulnerable populations and will the mental health parity insurance mandate be repealed?
7.       Medicaid Waiver or Section 1115 Programs have been around a long time and they are primarily a vehicle to increase cost sharing for recipients and reduce expenses for the states which fund them. The standardization of this process will probably not go away as states continue to seek relief from spiraling Medicaid costs.
8.       Improvement of funding for state Medicaid matching for noninstitutionalized care programs-will this be torpedoed?
Improving Health Quality and Paying for Performance
Accountable Care Organizations
The Accountable Care Organization Act became effective in 2012 and is administered by the Centers for Medicare and Medicaid. This program saved CMS over 700 million in the first five years, through better monitoring of preventable health events. (David Blumenthal, 2015) At present, 15% of all Medicare enrollees are served through Accountable Care Organizations. The ACO program identifies high cost health care events, such as hospital re-admissions and links improved clinical outcomes to performance, by paying health systems more money for achieving these targets. Health systems voluntarily participate in the program. There are 480 participating health care organizations within the U.S. and nine million people benefit from accountable care provisions. (Centers for Medicare Services, 2017)The Centers for Medicare and Medicaid have indicated this program saved the government 466 million in 2015. (Centers for Medicare and Medicaid, n.d.)
Financial and Clinical Efficacy
The Accountable Care Act created the Federal Coordinated Health Care Office whose purpose is to study health programs, gauge results, and seek ways to optimize the government expenditures with patient care. Will this agency be terminated because Dr. Price, who is a member of the Tea Party coalition, thinks doctors and hospitals should have less oversight? Hospitals are now huge corporations, often controlling entire regions, dictating prices, and are not typically subject to anti-trust laws. Shouldn’t some independent government agency be reviewing their programs, the costs, and the impacts on consumers?
Clinical Effectiveness and Research
The Institute for Clinical Effectiveness, known as the Patient Centered Outcomes Research Institute (PCORI), was created to identify and promote best healthcare practices for patient safety and clinical health, based on the following criteria:
1.       Assessment of preventative, diagnostic, and health care treatment options
2.       Improving health systems
3.       Improving health care decision making and patient communications
4.       Addressing health disparities (why patients in different demographic groups have different health outcomes/services)
5.       Accelerating patient centered research to identify ways to economically and clinically improve health
Funding for the PCORI agency was provided through the American Recovery and Rehabilitation Act in 2009, which taxes insurance companies $1 to $2 per enrollee. PCORI is taxed with identifying ways to cut waste, reduce unnecessary procedures, and improve disease surveillance to improve health outcomes.  The oversight organization has put a spotlight on medical suppliers, pharmaceutical companies, insurers, and other agents in the national healthcare landscape. For more information on this, read Chapter 3, pages 27-29 in my 2013 book, Unraveling U.S. Healthcare-A Personal Guide. (Winter, 2013)
 Of course, medical lobbyists have been deluging Congress with appeals to remove the “onerous taxes” which impact their businesses adversely (hardly at all) resulting in higher costs for American consumers. These companies simply want more money to reward their shareholders and enrich their stock option plans. No one in Congress is exempt from the influence of healthcare industry lobbyists, because even stalwart Democrats, Elizabeth Warren (MA) and Al Franken (MN) have lobbied to get the 3% medical device tax removed, because Boston Scientific, St. Jude Medical, and Medtronic are big employers located in their respective states. Removal of this tax would not result in lower costs for any patient or health system which buys any of their devices.  Increasing pricing transparency for cardiac and orthopedic devices would potentially result in savings for health systems and patients, but you don’t hear any lobbying for that. If anything, this scenario illustrates more acutely why we need independent government agency oversight for our healthcare system.

Returning to the 1950’s model for healthcare will not lower costs across the health system and it is important for consumers to understand that your insurance premiums are but one aspect of the healthcare system. We all need to be concerned about that for which we pay for our health care, the conflicts of interest inherent in the system, and that which is negotiable. Isn’t this how we would handle any other significant purchase? Keep reading this column for up-to-date information on healthcare concerns, actions, and facts. And this is the healthpolicymaven signing off wishing you fully informed consent for your next vote, purchase, or procedure. Read the fine print and do use “actual facts” from vetted sources for decision-making.

Roberta E. Winter, MHA, MPA is a freelance journalist and consultant, with analytical experience in the insurance industry, hospital systems, regulatory analysis, healthcare research, and patient advocacy.


Centers for Medicare and Medicaid. (n.d.). 2016 Fact Sheets Medicare Shared Savings Program. Retrieved February 15, 2017, from Centers for Medicare and
Centers for Medicare Services. (2017, February 15). CMS Medicare Shared Savings Programs. Retrieved from
Congressional Budget Office. (2015). Budgetary and Economic Effects of Repealing the Affordable Care Act. United States Congress. Washington, D.C.: Congressional Budget Office. Retrieved February 15, 2017, from
David Blumenthal, M. M. (2015, June 18). The Afforable Care Act at 5 Years. (M. Mary Beth Hamel, Ed.) The New England Journal of Medicine, 372, pp. 2451-2458. doi:10.1056/NEJMhpr1503614 (2017, February 15). Retrieved February 15, 2017, from
Pear, R. (2016, November 28). Tom Price, Obama Care Critic is Trump's Choice for Health Secretary. Retrieved from The New York Times:
Winter, R. E. (2013). Evidence-Based Planning-What It Means and Why You Should Care. In R. E. Winter, Unraveling U.S. Healthcare-A Personal Guide (pp. 27-29). Lanham, Maryland: Rowman & Littlefield.