Is That ObamaCare Crashing to Earth?

Like NASA’s climate satellite that is plummeting toward earth today, ObamaCare is falling apart, and it’s only a matter of time until it crashes, too.

CLASS is out: The latest example is yesterday’s brouhaha over the maybe-it’s-closing, maybe-it’s-not office that is tasked with implementing the CLASS Act.

It has been clear from the beginning that the CLASS program was a sham. It was dubbed so by Sen. Kent Conrad, Democrat of North Dakota, as “A Ponzi scheme of the first order, the kind of thing that Bernie Madoff would have been proud of.” HHS Secretary Kathleen Sebelius admitted to Congress this year the program is “totally unsustainable.”

CLASS is a brand new entitlement program to provide government-run long-term care insurance. It played an important role in the fictional accounting of ObamaCare since it starts collecting money five years before any benefits are paid.

Bob Yee, the actuary charged with the impossible task of making the program work, sent out a clearly unauthorized email yesterday telling colleagues his office was closing.

The White House denied it, but this week a Senate Appropriations Committee staffer told reporters that the administration had asked Senate Democrats not to provide any funding for the long-term care program offices for the next fiscal year.

What a mess. So while Yee says he’s been relieved of his duties and everyone else in the office has been reassigned, HHS still insists that “reports that the CLASS office is closing are not accurate.”

Connie Garner, a former Kennedy staffer and architect of the CLASS Act, pointed out that the program was created by law, and that the administration can’t just terminate it.

That’s especially true since CLASS was being milked to provide $70 billion toward the up-front cost of ObamaCare.

So where is the money going to come from to make up the difference? Good riddance to this program, but Congress still needs to ask the question.

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“If you like your coverage…” Unlike the NASA satellite that had a useful life monitoring the climate, ObamaCare is so poorly engineered that it is unlikely to ever get lift-off as the states balk at its costs and complexity.

The Ohio Department of Insurance commissioned a study on what to expect from ObamaCare from the actuarial firm Milliman, Inc. of Seattle.

Milliman’s report estimates that 790,000 Ohioans will lose their private health insurance. Further, health insurance premiums in the individual market could increase by as much as 55% to 85% when ObamaCare takes full effect in 2014. Small businesses could see premium increases, and, in many cases, “these changes could be greater than 25%,” not counting regular medical inflation. So much for lowering health costs.

A total of 688,000 Ohio residents will move OUT of employer coverage, and most of those getting coverage in the new state exchanges will be people who lost their employer coverage because firms have new incentives to “dump” their workers.

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Disturbance in the states. State officials charged with implementing ObamaCare are frustrated and confused by the lack of clear guidance from regulators. Even those who want to implement the law are privately expressing anger at the Obama administration for providing them so little information on how to proceed.

The National Governors Association recently called a meeting of 120 officials from 40 states to discuss implementation of the massive health care law. Last Friday, the NGA circulated a summary of the two-day meeting.

States that are resisting the law, states still trying to figure out what to do, and others that are completely on board all were represented at the NGA meeting. “Despite these differences, many of the challenges that state officials described were echoed throughout the meeting by the entire range [of] states participating,” the report said. “All of the states have concerns,” and are “somewhat daunted by the challenge of extremely complex implementation.”

Insurance exchanges, for example, must be “wholly created in a very short time period,” and yet they present “major challenges,” because the states must establish interconnected, automated systems to determine whether any particular citizen is eligible for subsidies and, if so, through which program.

Besides the lack of direction, the states are also concerned about the costs and resources needed to implement the law. “Tight deadlines, severely strained budgets, and human-resources shortages further complicate implementation in nearly every state,” the report said.

And it can’t work if the states don’t cooperate. Here’s a link to a piece I wrote for National Review with more on the magnitude of the task facing the states and their complaints. Representatives of most states attended a second meeting called by HHS officials in Washington this week, but it reportedly did little to provide needed answers.

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WAY too much information! You just can’t make this up.

Doctors, hospitals, and anyone else who wants to get paid for providing medical services after 2013 must switch to a new “coding system” that gives numbers and letters to medical diagnoses and treatment. Providers must get the codes right if they want to get paid.

This is a tremendously expensive endeavor, and it puts a huge strain on medical providers who are also struggling to implement information systems, adjust to ObamaCare’s changes, and much more.

Today, hospitals and doctors use a system with about 18,000 codes to describe medical services in bills they send to insurers. The new federally mandated version will expand the number to around 140,000 codes.

The Wall Street Journal describes:

It’s not clear how many klutzes want to notify their insurers that a doctor visit was a W22.02XA, “walked into lamppost, initial encounter” (or, for that matter, a W22.02XD, “walked into lamppost, subsequent encounter”).

…Code V91.07XA, which involves a “burn due to water-skis on fire,” is another mystery? “Is it a trick skier jumping through hoops of fire? How does it happen?”

…Indeed, health plans may never again wonder where a patient got hurt. There are codes for injuries in opera houses, art galleries, squash courts and nine locations in and around a mobile home, from the bathroom to the bedroom.

…It will also have a code for recording that a patient’s injury occurred in a chicken coop.

The new system is known as “ICD-10, for International Classification of Diseases, 10th Revision.” It’s based upon a system that the World Health Organization created and which has been in use in many countries for more than a decade to help gather better information for researchers and clinicians.

But U.S. government regulators — from the same agency implementing much of ObamaCare — clearly got carried away.

The WHO, for instance, didn’t see the need for 72 codes about injuries tied to birds. But American doctors whose patients run afoul of a duck, macaw, parrot, goose, turkey or chicken will be able to select from nine codes for each animal, notes George Alex, an official at the Advisory Board Co., a health-care research firm.

There are 312 animal codes in all, he says, compared to nine in the international version. There are separate codes for “bitten by turtle” and “struck by turtle.”

When do even the regulators admit this is getting ridiculous?


Health Policy Basics: The A-B-C (and D) of Medicare

The Galen Institute, The Heritage Foundation, and the American Enterprise Institute are jointly hosting a series of briefings for Capitol Hill staffers on the basics of health policy. Here is Grace-Marie Turner’s presentation at the introductory briefing on Medicare. And here is a link to the complementary presentation by AEI’s Joe Antos.
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Health-Care Chaos

Grace-Marie Turner
National Review Online, 09/20/11

A report released last week by the National Governors Association shines one more spotlight on the massive and near-impossible task of implementing the massive health care law. The three major components of the law — insurance reform, Medicaid expansion, and health-insurance exchanges — are primarily the states’ responsibilities, but the states must work within the federal government’s rules, and the administration has been very slow to explain what those rules are. Besides the lack of direction, the states are also concerned about the costs and resources needed to implement the law. The report said that “states worry that if a federal exchange were the single point of entry to all the state’s insurance affordability programs, they may lose control of their Medicaid program” — and therefore lose control of spending in what for many is the single largest item in the state budget. On top of the massive unpopularity of ObamaCare, the NGA report provides further evidence that the law simply cannot work.

Read More »


Don’t Forget Obamacare
James C. Capretta, The Weekly Standard, 09/26/11

The Best Jobs Program? Full Repeal of ObamaCare
Sally C. Pipes,, 09/20/11

Walked Into a Lamppost? Hurt While Crocheting? Help Is on the Way
Anna Wilde Mathews, The Wall Street Journal, 09/13/11

Obama’s Bad Budget Moves
James C. Capretta, National Review, 09/22/11

More Transparency, Better Health Care
George Shultz, Arnold Milstein and Robert Krughoff, The Wall Street Journal, 09/20/11


Designed to Fail
Joseph Antos, National Journal, 09/19/11

The Medicare Monster
Yuval Levin, The Weekly Standard, 09/26/11

How Much Savings Can We Wring from Medicare?
Michael Chernew, Ph.D., Dana Goldman, Ph.D., and Sarah Axeen, B.A., The New England Journal of Medicine, 09/21/11


Why is CDC dragging its feet on meningitis vaccines?
Merrill Matthews, The Dallas Morning News, 09/13/11

The Global Biomedical Industry: Preserving U.S. Leadership
Ross C. DeVol, Armen Bedroussian, and Benjamin Yeo, Milken Institute, 09/22/11


Report: Health care law to bring cost hikes to Ohio
Dayton Business Journal, 09/20/11


Benjamin Rush Society Event
Monday, September 26, 2011
Hampden-Sydney, VA
Grace-Marie Turner will speak about “The Health Care Crisis.”

Association of American Physicians and Surgeons 68th Annual Meeting
Sep 28, 2011 – Oct 1, 2011
Atlanta, GA
Grace-Marie Turner will speak about “Free Market Health Care Solutions — the proposals their prospects in DC” on Thursday, September 29.

St. Louis Association of Health Underwriters 2011 Symposium: Challenges & Solutions for Tomorrow
Friday, September 30, 2011
St. Louis, MO
Grace-Marie Turner will speak about “Challenges with the New Health Care Law.”

The Oregon Health Insurance Experiment and Evidence-Based Health Reform
Cato Institute Policy Forum
Wednesday, October 5, 2011
Washington, DC