WellPoint's Heart-Stopping Rate Increase

Submitted by Wendell Potter on

Cash or Credit onlyA congressional hearing next week into the proposed 39 percent rate increase in California by health insurance giant WellPoint could breathe new life into health care reform efforts on Capitol Hill, especially if lawmakers broaden their investigation into the outrageous rate increases other insurers are also demanding from coast to coast.

WellPoint found itself in Congressional investigators' crosshairs after the California Department of Insurance challenged the company's planned increase in the rates it charges its customers who cannot get coverage through the workplace, but have to go it alone in what is called the individual market.

This week WellPoint announced that it was canceling its Investor Day, which had been scheduled the day before hearing by the House Energy and Commerce subcommittee on oversight and investigations. An Investor Day is a big and usually very expensive affair that publicly-traded companies hold, usually once a year, to tell investors and analysts how much money they expect to make in the coming year, and how they plan to make it. It is not at all unusual for a company to spend a quarter of a million dollars on these soires, which, because the news media usually ignore them, give company executives a chance to speak with more candor than usual about their operations.

I know because I used to help plan these functions. They are often held in New York's finest hotels -- the ones that charge a minimum of $1,000 a night for their rooms.

Keith Olbermann invited me to talk about WellPoint's rate increase on his Countdown show on MSNBC last night. When I got home, I saw that I had received several emails from people who has seen the show and wanted me to know about their own heart-stopping rate increase notices. Two were from former colleagues of mine at CIGNA, both of whom had worked for the company for years and who were enrolled in a pre-retirement plan. One said CIGNA planned to increase his rates by 46 percent this year. Another said his rate increase would be 47 percent. Yet another acquaintance, who works for a small business in Iowa, said he received a notice from his insurer that his rates would be going up by 38 percent.

I pointed out on Countdown that WellPoint's planned increase in Maine was so high the state's insurance commissioner cut the planned increase in half, prompting WellPoint to sue the state. That case is still pending. And I noted that Blue Cross and Blue Shield of Nebraska announced plans last year to increase rates on some of its plans by more than 35 percent. It won't take a lot of investigating for members of Congress to see that these outrageous rate increases are common, and that the WellPoint increase in California is nothing more than business as usual for this industry, which values profits far more than the health and well-being of its customers. If everyone who has received a rate increase notice lets their members of Congress know about it, it just might give lawmakers the motivation they need to get reform passed.

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fritz replied on

yesterday, 2/17/10 ,rallies nationwide were organized through www.healthcareforamericanow.org to the resounding indifference of MSM. true enough that healthcare industry practices are too often simply indefensible, but MSM's inability or unwillingness to recognize, let alone spotlight, public resistance to atrocities of this magnitude and frequency is no less damaging than the indifference of legislators or the deliberate misdeeds of industry insiders.

Susan S. replied on

So, why is it that Obama is now looking at regulation of the rates they can charge and NOT at a public option? I work full time, have insurance, and I would STILL choose a public option if it were available.

Anonymous replied on

Since it sounds like you worked for Cigna, one would suspect that you know how health insurance works, but a reminder sounds in order. Everyone pools money to pay for the costs of care, admin expenses and potentially a profit depending on the company. These ratios have tended to be constant. Generally insurance companies profits are not multiplying exponentially. People point to WellPoint costs doubling last year without noting that the main reason for the increase was that WP sold a business that accounted for 50% of profits. If profits aren't expanding, what's driving rate increases? If you look at medical loss ratios over past few years for insurers, these have actually been inching up. If premiums are going up every year, but ratios are same, costs must be increasing. Costs are increasing because of utilization, demographics, and runaway Rx use. The amusing thing if you closely read the insurers financial statements you'd realize that insurance companies know that the private insurance market is dying a slow death if there is no change. They want healthcare reform as much as everyone else (although not a public option). We could argue about what is a reasonable MLR, I wouldn't be opposed to a high one. I would just like to see incentives around care aligned to encourage good care and discourage overuse and misuse. Giving someone something for free is not going to accomplish this. I know I'm probably wasting my breath on all this. You also realize that Blue Cross Blue Shield of Nebraska is a non-profit entity don't you (even if execs might be doing pretty well, not unlike many Drs and Hospitals)? Many other non-profit plans (BCBS MI) are also hiking insurance rates - so profit is not the issue (even if it is AN issue). If someone in CA. is not happy with Anthem's rate hike, they could switch to Blue Shield of CA which is a non-profit or switch to a lower cost product (some of which had rate decreases). But that person would likely not see much of a difference with Blue Shield in rates for the same benefits since the cost is almost entirely based on how WE all over-utilize or mis-use care. Blaming the insurance companies is easy - coming up with true solutions is the challenge. I favor about 75% of the President's recent plan, but feel that he like all the others in Congress either can't or won't focus on the details and unintended consequences of the other 25% I have a problem with (even CBO won't score because it doesn't have enough details). One example - closing the donut hole on Medicare Rx. Why close it for everyone - it acts as a break on consumption and it should be means tested for those who can't afford, not for every person. My mother-in-law can certainly afford the $1500 per year in question. Other points: WellPoint is a for-profit entity, but since when did making a profit become a crime in America? When we're ready to eliminate profits for doctors, hospitals, grocers, home builders, (or anyone who provides an essential service and makes money beyond what they need to live on) maybe then it would make sense to discuss (circa 1935 USSR). Meet you at the gulag.... You're right on the point that costs for investor day functions can tend to be obscene - true for almost all publicly-traded companies, but eliminating this is not going to fix healthcare, so focusing on this gives the masses a little red meat, but does everyone a dis-service. I've worked with big companies, small ones, non-profits and government - the bigger the worse has been my experience and all waste more money than I care to think about.

Mutternich replied on

<blockquote>"...but since when did making a profit become a crime in America?"</blockquote> Some things belong in the for-profit sector, some don't. Selling iPods for profit, no problem. Standing between people and needed medical care and gouging them for all they're worth, that is (or would be deemed, in any sane, just society) a crime. <blockquote>"Meet you at the gulag...."</blockquote> The word you're looking for here is "Stalinism," not "public option" or even "single-payer universal coverage." I'll bet you're the guy who first thought to draw that Hitler mustache on Barack Obama's picture, too.

StopKickingNowPlease replied on

Re: gulag comment, I was trying to use some humor as part of my point. It appears the humor was missed (or not present), I will refrain from further flippant remarks. I voted for Obama so you can withdraw your flippant remark as well if you choose. Gouging is pretty strong word considering the facts - WellPoint CEO pointed out they had a 2009 4.5% profit margin in testimony today. Not sure how this is gouging. In aggregate they made a lot of money, but on a per-customer basis not really compared to other industries. My point is that we live in a capitalist society and I personally believe that profit motivates people (Within reasonable boundaries). There are non-profit insurers who compete as well who charge higher rates so I don't think you can blame everything on insurers profit. I'm not sure you addressed my basic question by the way - should doctors, hospitals, grocers, home builders not profit because they also provide basic needed services? I'm guessing that we can just agree to disagree on the question of profit. I don't support a public option (but do support a mandate, elimination of pre-existing clauses, etc...). My primary concern is who will say no if there are no insurers? (The insurers don't really do that great a job at this either). People can't have a blank check and I've lost all confidence that the government (our leaders) will make the hard choices. Look at the deficit, debt, all of the unfunded liabilities, the blank check for Fannie Mae and Freddie Mac, etc... Look at the state level. If I could blame one party on the financial mess, I might feel differently, but I rightly can't. Look at the Medicare Rx benefit for Seniors as an example. Bush introduced it and Dems. supported it even though it drove us deeper into debt. Seniors complained about it even though we're only talking about $1500 deductible after some 1st dollar coverage. Obama supports eliminating the donut which dispenses of any filter to getting drugs. Overall costs will go way up (to be paid later). Why are we closing the donut hole for everyone. Why is it not means tested? Why is it not funded. Because no one wants to say no. We can't negotiate with the Rx companies on prices for this program either - don't want to piss off the Rx companies. is Rx program's cost trajectory lower than core inflation - no. No one is complaining about this cost going up, because no one sees it.... is this fair to our children and the children of our children - see Greece for what's coming if we don't start addressing this. No one wants to say no. Someone eventually has to pay. I have no problem with the concept that those with more pay more. But there is a limit and there has to be some alignment of incentives so care is accessed efficiently - not all drugs and tests are needed and most people certainly don't do what they need to do on a personal level. Regarding your reference to a crime, no one is standing between needed medical care and a consumer, at least no more than the government is standing between a senior and the doctor. The real question is who will pay, thats what this is about and why we have insurance.... I could call my doctor tomorrow and pay him out of pocket, no one involved. People buy insurance or should in the event something bad happens. The insurance company negotiates a rate with the provider better than I can negotiate and covers me if I have an event that I won't be able to afford a catastrophic event. Its my choice to involve an insurer. No one forces me to (at least not until the mandate it put in place). I know its not this simple and that most insurance companies are not benevolent. But you also have to look at the facts. The commercial market subsidizes Medicare and Medicaid. Any physician or hospital will admit this. And despite this subsidization, doctors are dropping out of Medicare and certainly Medicaid. And even with subsidization the trajectory for Medicare is insolvency if changes are not made to benefits or revenues. Creating a public option creates a similar blank check. I was dismayed with the testimony of the 3 individuals from California this morning. Aside from the fact that the pre-existing clause is a major problem, no one seemed to understand the dynamics or at least did not want to admit it. On the one side the witnesses complained about the high costs and low benefits of their coverage based on the fact they don't use enough care to even meet their deductibles, but on the other side they complained that benefits are limited - Rx, etc.... without seeing a correlation between the 2. Someone is using care and someone is paying for it. Even if you go rid of the profit and minimized the cost of admin, the picture would not be all that different. Just do the math. This is how it works - should MLRs be higher, maybe. But this is not the key driver, we are.... We want something for nothing and no one in government is honest enough to say it. Unfortunately, I think our education system has failed us as well since many people can't seem to do math (starting with Congress) either.

Mutternich replied on

<blockquote>"I'm not sure you addressed my basic question by the way..."</blockquote> So that was a question? My apologies; it came across as just another repetition of that beloved old "slippery slope to socialism" canard. <blockquote>"Look at the deficit..."</blockquote> Endless war? Hellfire missiles blowing up innocents by the score to hit the occasional al Qaeda leader? One of those would pay for a lot of chemotherapy. <blockquote>"...the blank check for Fannie Mae and Freddie Mac..." </blockquote> Oh yes, "government" Fanny and Freddy: outrageous executive compensation, shares traded on NYSE and hawked on CNBC, hiring lobbyists to fend off Congressional oversight...perfect example of capitalism given free rein. <blockquote>"I personally believe that profit motivates people (Within reasonable boundaries)."</blockquote> Oh, I agree. Furthermore, it motivates a lot of them far beyond any reasonable boundaries, and that's what we're talking about here. <blockquote>WellPoint CEO pointed out they had a 2009 4.5% profit margin in testimony today. </blockquote> Even that 4.5 percent could pay for an awful lot of patient care rather than going to stockholders. But then there's this: http://energycommerce.house.gov/documents/20100224/E-mail.from.Barry.Shane.to.Cindy.Miller.October.7.2009.pdf <blockquote>"No one is standing between needed medical care and a consumer, at least no more than the government is standing between a senior and the doctor."</blockquote> Jeez, what a whopper! Medical practices have to hire MBAs to haggle with private insurers for payment for covered services -- could that by any chance be a factor in rising medical costs? -- but I've never had a problem with Medicare. I've never seen hide nor hair of that "government bureaucrat" I keep hearing about. <blockquote>... We want something for nothing and no one in government is honest enough to say it.</blockquote> No, we want something for our something, especially the people who get summarily dumped after after paying in scores of thousands of dollars over years and years. <blockquote>"I don't support a public option (but do support a mandate, elimination of pre-existing clauses, etc...)"</blockquote> ...Which the lobbyists will start chipping away at as soon as it's enacted. There's a fundamental, irreconcilable conflict of interest at the heart of the for-profit health insurance business. I want a public option, and I for one hope it really will end up doing away with private health insurance.

Anonymous replied on

Before I address your seemingly angry comments. Let me first say that the President did a great job today. Probably a waste of time in some eyes in terms of changing votes, but I for one appreciated the open dialogue and his fair treatment of all involved. If you didn’t listen, I especially appreciated Rep. Jim Cooper’s comments. I think it summed up our national problem – our (collective) inability to face our challenges honestly. This likely will be my last post I wish I could say it had been informative for me, but you can breath a sigh of relief that I’m done. I infer from your comments that you are on Medicare. Therefore if a blank check is good enough for you, it must be good for the next person. This makes sense in terms of being able to see why you don’t understand the math. You enjoy a benefit that far outweighs anything you put into it. Like a Ponzi scheme it assumes that the next person in pays for you and when that person reaches retirement some other person will buy-in (pay the payroll tax). Like a Ponzi scheme, eventually you run out of enough people coming to the party (or demographics change so much that more people receive benefits than pay into the system). This is our current trajectory, but hey you’re first in so what’s to worry about. You currently have a prescription benefit for which you likely never contributed a dime (passed into law when the country was already in debt). You are now about to get another benefit if the Senate bill goes through reconciliation (elimination of the Rx donut hole) which means you will pay very little for your prescriptions regardless of your wealth and me, my children and grandchildren get the privilege of paying for it. That doesn’t even address the coming insolvency of Medicare (someone will kick the real problem forward a few years, but eventually math wins). What people forget is the old lesson of compound interest – the bigger the debt, the larger the interest payments; the larger the interest payments, the less money for anything else in the Federal budget. Don't pay the principal, well you get the picture if your home is currently in foreclosure. And, once interest rates go up then the real mess begins. Jim Cooper pointed it out when he said each day that goes by makes the problem worse. Everyone in the room today understood what he was talking about – this is the bogeyman everyone ignores and shoos under the carpet in Congress. No one else really wants to step in it (hence the President’s commission which realistically has a 1% chance of success although I’m praying otherwise). You could hear the silence when Rep. Cooper was speaking. Now that I’m completely depressed, permit me to respond to your comments. “So that was a question? My apologies; it came across as just another repetition of that beloved old "slippery slope to socialism" canard.” I was honestly trying to understand where you draw the line and how you logically you get there. Seems like you are like many of those in Congress who don’t want to try to see both sides and prefer to throw back a cliché (we’re now truly even for my gulag comment). That’s fine, no profit for insurance companies. Not the end of the world for me. See below on impact. “Endless war? Hellfire missiles blowing up innocents by the score to hit the occasional al Qaeda leader? One of those would pay for a lot of chemotherapy.” Fine argument wise, eliminate the Defense Department – you’re still $400 Billion short on the annual deficit (assuming a new health benefit does not add to this) which means the debt continues to grow. The Medical Industrial Complex is replacing this sector anyway. ) Not that you’d ever get 51 votes (let alone 60) in the Senate for this one. “Oh yes, "government" Fanny and Freddy: outrageous executive compensation, shares traded on NYSE and hawked on CNBC, hiring lobbyists to fend off Congressional oversight...perfect example of capitalism given free rein.” I wouldn’t exactly call quasi-governmental agencies capitalism (although a lot of people did get rich). Fannie and Freddie were established and milked by Congress, mostly the Democrats. I agree with your points about money in Washington and policy, but people bought stock because of the implicit government guarantee. Congress started it, we can agree on where things went wrong from there. Investors figured they couldn’t lose, sounds similar to a Ponzi scheme – similar to some of the other programs we’re now writing about. Only now its worse – now the Macs truly have a blank check and we have $6 trillion in liabilities that are not even counted when looking at the country’s balance sheet. “Oh, I agree. Furthermore, it motivates a lot of them far beyond any reasonable boundaries, and that's what we're talking about here.” You know, this is actually one of the comments that I regretted. People are motivated by money, it’s a fact – not all people, but most whether they like to admit it or not. You’re right, that we don’t need to look far for greed, but I do believe in the free-market system with a strong referee. This is the role for government to be a fair and effective referee – both in regulation and enforcement. This is another thing currently broken in Washington (and I don’t mean only in the last year). “Even that 4.5 percent could pay for an awful lot of patient care rather than going to stockholders. But then there's this:” Give everything back to the membership WellPoint serves ($2.4 Billion in 2009 (excluding the one-time sale) divided by the 36 Million members gets you about one and one half penny per person if I’m doing my math right. Not as much care as you’d like to think. I will grant you that it is about 320,000 single people who could be insured assuming average cost of about $7500. So unlike in Washington, this does mean something to me, but its not 30 people. “Jeez, what a whopper! Medical practices have to hire MBAs to haggle with private insurers for payment for covered services -- could that by any chance be a factor in rising medical costs? -- but I've never had a problem with Medicare. I've never seen hide nor hair of that "government bureaucrat" I keep hearing about.” Uh, the cost trend for Medicare is higher than general inflation so I don't think this is a driver. I agree with the fact that its too complicated – which is why I think insurance as structured today does not work – see my comment in a previous post about big entities. We have a monstrous system designed to help a small part of the population – the people with chronic conditions or who have a catastrophic event. We’d be better off focusing on this and preventive medicine. I know this is a pipe dream. “Medicare IS between you and your provider” and I don’t mean this in the pejorative sense that Republicans use it. I mean it in a factual sense that Medicare administrators are performing many of the same functions as an insurance bureaucrat. They don’t interfere on the cost side because as I’ve said before, no one says no under government programs. The reason you’ve never see anyone from Medicare is because someone else pays for it. No need to talk to you. The Doctors charge the commercial market more (and the uninsured who actually pay) so that YOU, enrolled in Medicare can pay less. Talk to your doctor next time about how they like the Medicare reimbursement rate (we’ll skip the charade discussion that Congress has every year about cutting it further). Medicare reimbursement rates are set by the government (between you and your doctor) and doctors are dropping out because its not enough and if the doctor still participates then he/she makes sure to charge other patients more to make up for YOU. Ditto for Medicaid only worse. The doctors have to haggle with the insurers because this is were they actually make money. As for the bureaucrat, you’ll love this – some of the same for-profit insurance companies that you hate contract with the government to perform many of the same administration functions that they provide for the private market (and I’m not just talking about Medicare Advantage program). The doctor argues with the insurance company in the private market, because this is the cash cow and they know they can’t argue with the government. “No, we want something for our something, especially the people who get summarily dumped after after paying in scores of thousands of dollars over years and years.” This is the cat’s meow. Yes there are some people in the market who are paying year after year exorbitant amounts, like me. (My current annual premiums are $13K), but you’re in Medicare so its not about you. And my payments are subsidizing your care (which is okay with me if you are under poverty level, but its not okay if you're not). This is why I agree that we have to get rid of pre-existing conditions and rescissions – both are unfair and not right. But the reality is that this means costs will likely go up for everyone. I’m okay with this concept, but I don’t think the vast majority of Americans understand it or will pay for it once they understand the implications. We can pretend otherwise, but if you have 10 people sharing annual claim costs of $10,000 and then add someone who has $50,000 in annual costs because of a chronic condition, everyone in that group of 11 is now going to pay more. The mandate hopefully adds more healthy people to the pool so that in addition to the one person (with $50,000), others with $0 annual expenses also join to bring down the overall average cost. But in the math example above you need at least 49 people with $0 in annual costs to offset the one sick person or average costs go up. No one really knows what’s going to happen when we change things around because of all of the variables – how much of the $50000 was already covered in the provider pricing for the 10, will the 49 new people now use more care because they will now have insurance. No one really knows. The average could go up or down. If anyone tells you they know for sure which way it will go, they are lying. My point is that we may drive up costs for everyone (or not, I really don’t know). If they do go up – people will really be upset, then the revolt begins or like the other programs, we push the cost as far out as possible. I for one would prefer not to pass this to my kids. Unfortunately, if we screw up the incentives in the new world i.e., assess penalties that are too low, provide benefits that are too rich, we will drive up the overall costs for everyone. Who will make up for the difference if the costs go up? We can make guesses on which direction things will go, but we won’t really know until after the first year or two. “...Which the lobbyists will start chipping away at as soon as it's enacted.” Chip away? The Senate bill is the greatest thing since sliced bread for the Medical Industrial Complex (including the insurers). Will the Doctors change their rates to account for the fact they no longer need to make up for the uninsured. Doubtful. With more people with benefits the newly insured actually don’t pay full cost for, doctors/hospitals/Rx are likely to have even more patients with money (our children’s money). This is the same reason I was concerned about the public option. If we're going that direction, I think I’d rather fall on the sword and make the whole system public so no one makes a profit, because there is nothing worse than one part in the private market with another in the public (see Fannie and Freddie above). Insurers love it (see the gains in the stock market today) because more people will enroll in insurance plans. And better yet for the insurers is that the newly insured under $88k don’t pay the full premium cost (because of the taxpayer subsidies). So the insurers are whole, no need to worry about them. Matter of fact they are now treated like the doctors. No one initially complains because the true cost of things are hidden (in this case the premium cost). The Rx people are giddy at the thought of getting rid of the Rx donut hole. The people who don’t want to play well with others – they will pay a penalty that is so low as to be laughable, then enter system when they get sick and piggyback on all of the hardworking Americans who do play well and have been paying much higher costs (either through employers or premiums). So who gets crushed if the average costs do go up – the smaller businesses (50-1000) will find it difficult because of the penalties to them, but they will either raise prices (see inflation, interest rates, debt implications above) or go out of business (see inflation above) and those people who make more than $88,000 who will pay more in taxes and likely premiums. “There's a fundamental, irreconcilable conflict of interest at the heart of the for-profit health insurance business. I want a public option, and I for one hope it really will end up doing away with private health insurance.” As many things as they may do wrong (make a profit for those that are for-profit, pay executives too much money, not efficiently improve the delivery or payment of care), insurance companies are not the problem - we are. If we the American people had Medicare on a sustainable path, or Medicaid or Social Security, I might have less of a problem with talking about another program, but the fact is none of them are currently sustainable (with or without the wars). I’d prefer not to be in the car with broken brakes (sorry Toyota) speeding down the unfinished highway that currently ends with a cliff with everyone in the car yelling about where’s mine while singing along the way. Since we’re sharing links, try this one on for size and be sure to read volume 2 2010 when in comes out in the next week. http://www.commonwealthfund.org/Content/Newsletters/Washington-Health-Policy-in-Review/2009/May/May-18-2009/Trustees-Report-Projects-2017-Insolvency-Of-Medicare-Hospital-Fund.aspx Maybe you can read it while you enjoy the fact that you were early on the Ponzi schemes. I'll worry about the last ones in our children.

Mutternich replied on

<blockquote>I wouldn’t exactly call quasi-governmental agencies capitalism (although a lot of people did get rich). Fannie and Freddie were established and milked by Congress, mostly the Democrats.</blockquote> Sorry, I should have said "crony capitalist." If they're "quasi-" anything, the things I mentioned make them quasi-<i>corporate</i>. <blockquote>"...divided by the 36 Million members gets you about one and one half penny per person if I’m doing my math right."</blockquote> Not by all 36 million, maybe just a couple of thousand who died because they got dumped. <blockquote>"You currently have a prescription benefit for which you likely never contributed a dime (passed into law when the country was already in debt)."</blockquote> FYI, I contribute every month; I'm nowhere near the donut hole and nowhere near collecting what I've paid in. I've also payed into Medicare since the program's inception, and I still do. What you forget, too, is the social cost of <i>not</i> providing. Take cataract surgery on Medicare. Not only can the recipient keep enjoying watching TV, he can still drive a car, which means someone else doesn't have to drive her around and s/he can give rides to still others. That's just one small example and it's not intangible; in aggregate it adds up to a lot of bucks, or would if someone "did the math." <blockquote>"Talk to your doctor next time about how they like the Medicare reimbursement rate.</blockquote> Already have, to my primary. That's why he has a boutique practice, which means I pay a fixed yearly amount for a list of covered services. In effect, that makes him my insurer at least as far as those services are concerned (and to that extent, you're not subsidizing me.) Still pretty capitalistic, but since his practice consists of just himself and one assistant, it beats the hell out of Wellpoint as far as it goes. <blockquote>As for the bureaucrat, you’ll love this – some of the same for-profit insurance companies that you hate contract with the government to perform many of the same administration functions that they provide for the private market (and I’m not just talking about Medicare Advantage program).</blockquote> Think I don't know that? This way they're at least theoretically accountable to the government. <blockquote>"Yes there are some people in the market who are paying year after year exorbitant amounts, like me. (My current annual premiums are $13K)."</blockquote> Yet you still defend the status quo with maybe a few token changes. (Dropping disqualification for pre-existing condition is like civil unions: used to be anathema, but now it's the fallback position.) Sounds like Stockholm syndrome. <blockquote>"...But the fact is none of them are currently sustainable (with or without the wars). </blockquote> Then let's stop the wars and put half the defense budget into healthcare. Maybe that would keep Medicare going until, say, 2027 instead of 2017. Fewer innocent Afghan villagers killed, more Americans served instead of robbed, and more time to come up with permanent solutions. A lot better than nothing.

Anonymous replied on

Thank you, this back and forth has helped me understand the warped boomer thinking that has allowed us to slide into a $12 trillion federal debt hole ($18 trillion if we count the quasi-corporate entities), a $1 Trillion state debt hole and almost $2 trillion local debt hole. You pay 25%, I pay 42%, our children pick up the rest and you question why I think its not a good deal and blame others for why they need to pay 75%. Like another of your generation, Bernie Madoff, you seem to have a gift for making it seem like everything's great, why worry and deflecting the salient points of a question which probably works on most people to get them to buy in on the myth of the Ponzi scheme. I love the fact you respond to my point about doctors not being happy about medicare reimbursement rates by telling me that you pay your doctor an extra fee. This would seem to prove my point, but oh hey, let me thank you for keeping Medicare costs down. Also, I pay 13K as part of a self-insured arrangement. I pay the full plan cost (no employer contribution). Each person pays in and this covers all our costs based on last years costs for all the members in our plan (no profits, no subsidies from the government, but some reinsurance). If we used your logic of how this should work, I should pay about $3K, someone else's taxes would kick in another $5-6K annually and my children would pick up the rest in about 25 years. Sounds great for me, whats the catch? Guess my children will need to figure that one out. So yes, Bernie, I'd rather not make a deal unless the numbers are honest. I'm not interested in the interest-only loan, thank you. The problem is that no one is being honest on either side and so it happens most of the pretenders in Congress tend to be of your generation. I'll forgo asking you for the math of your individual situation, (I can see that your math likely is a 1+1=3 kind of math, but even if you're not benefiting now, it does not absolve you from the fact that you currently COULD benefit from the Madoff math of Medicare. The value of Insurance means that you could benefit if needed it is not based on how much you use. . Stopping the wars doesn't balance the budget, but even hypothetically you don't want to put this money toward the debt, you want to spend more on healthcare.... Well this makes sense. This had me doubling over in laughter. The average premium to be paid in 2010 for the Rx benefit (pre-Obama proposal) will be about $30/month or $360 a year. The average benefit has been about 4-5 times this. If you read the link i posted, you'd see if you look at page 5 of the trustees report (I'm not saying this, the government is) that premiums for Medicare D (Rx) will provide about $5 billion or 10% of the overall program cost - where is the rest of the money coming from? You seem to think your paying for it. If you were truly paying for it, your premiums should be about 10x higher. While you and your boomer Madoff crowd probably think your taxes cover the rest, we're actually borrowing about 33% of what we're spending so our kids are technically picking up about 17% of the Rx benefits. Thanks again....

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