Health Care | MacIver Institute

Investigations Into Fake Doctor Excuses Heat Up

MacIver News Service | March 15, 2011

[Madison, Wisc...] Doctors accused of writing fake sick notes to protesters who staged sick outs to attend rallies, have until March 21^st to respond to complaints filed with the Department of Regulation and Licensing, MacIver News Service has learned.

On Saturday, February 19^th, MacIver News Service broke the story in which doctors were caught on video offering and handing out sick notes to protesters who needed excuses for missing work the week before. These doctor’s notes were handed out without any attempt to perform even a cursory medical examine or to solicit even a rudimentary medical history from the ‘patients.’

After several complaints were lodged by witnesses and individuals who saw the MNS report, the Division of Enforcement in the Department of Regulation and Licensing (DRL) informed the doctors of the complaints filed against them.

The letters were mailed to eleven respondents on February 28^th and included copies of complaints filed with the Department. According to the DRL, nine of the individuals against whom complaints have been lodged are licensed physicians and two are unlicensed individuals. The doctors were requested to provide a written explanation to each of the allegations contained in the complaints. The DRL has not yet released those complaints to the public, however the original MNS report did identify one of the doctors allegedly involved.

“The Wisconsin Medical Examining Board, which is the regulatory authority that issued your license, has requested that we review the enclosed complaints that have been filed against you. The complaints allege that you signed “fake” sick notes for people who skipped school or work to demonstrate at the State Capitol,” the letters to the licensed individuals read.

The controversial notes were issued during a mid-February rally in Madison wherein supporters of government employee unions were protesting Governor Scott Walker’s Budget Repair Bill, now known as 2011 Wisconsin Act 10.

“I asked if they were handing out doctors’ excuses and a guy said yes and asked me if I needed one,” one anonymous patient who received one of the bogus excuse notes told MNS. “When I told them I needed one for February 16 and 17th, he wondered if I wanted to come back here for the protests next week.”

What happened next surprised her.

“I said, ‘sure,’ and I received a doctor’s note for the 16th through the 25th of February, without a medical exam.”

The notes read:

Feb 19, 2011

Patient’s name______

Date of birth ____/_____/_____

To Whom it May Concern:

This is confirm I have seen and evaluated the above named patient.

Please excuse from work/school due to a medical condition from

____/____/____ through

Please contact me at badgerdoctors@gmail.com if additional information is needed. Thank you.

Sincerely,

Physician Signature:

Physician Name

WI license number

Based on an examination of the signature and medical license number provided, one of the men handing out these notes was purporting to be James H Shropshire MD, a Clinical Associate Professor at the University Wisconsin Madison.

The complaints with the Department of Regulations and Licensing and the doctors’ subsequent responses will be reviewed by the Wisconsin Medical Examining Board, who will determine the merits of the complaints. At that time the Board will either consider the complaints closed, or recommend an investigation be conducted.

The University of Wisconsin School of Medicine and Public Health and the University of Wisconsin Medical Foundation have also launched their own investigation into the matter.

“The investigation will identify which UW Health physicians were involved and whether their behavior constituted violations of medical ethics or University of Wisconsin and UW Health policies and work rules,” UW Health said in a press statement issued last month. “The investigation and any potential future action will follow the established procedures of the University of Wisconsin. Any future disciplinary action taken will be considered a personnel matter and in accord with University of Wisconsin policies, and will not be open to public discussion.”

See the initial report, including the video which captured some of the incidents, here.

Tags: Capitol Chaos, Governor Walker, Health Care, Labor Unions
Posted in News | March 14, 2011 | | 4 Comments

Study Shows, Even After Limits, Public Employee Benefits Would Be Extremely Generous

MacIver News Service | February 16, 2011

[Madison, Wisc..] Wisconsin taxpayers would be very generous to state employees even after the proposed budget repair bill passes this week, according to a just released study. The website HCTrends indicates if the proposed changes were to become law, public employees would still pay less toward their family health insurance premium than most other Midwestern states and the vast majority of large employers in Southeastern Wisconsin.

Currently, Wisconsin state employees pay less than 5 percent of the premium cost for family coverage (4.35 percent for union employees and 4.96 percent for non?union employees). That’s lower than the 6.2 percent they paid in 2009, when Wisconsin’s employee contribution was the second?lowest among Midwest states for family coverage.

Republican Governor Scott Walker has proposed raising the employee share of health insurance premiums to 12.4 percent, however even after the additional contribution, the contribution rate would still be less than the 2009 Midwest average for state government employees.

Moreover, the new rate would also be less than the employee contributions required at 85 percent of large Milwaukee?area employers.

The proposed changes would cost the average state employee an additional $1,560 per year for family coverage, but the amount they would pay ($2,496) would still be significantly less than the $3,875 average premium contribution at large private?sector employers in southeastern Wisconsin.

“State employees will also continue to get much more for their money than their private sector counterparts,” the study reads. “The state plan offers more benefits, lower deductibles, co-pays and out of pocket maximums than the average private sector plan.”

HCTrends reviewed data from the Wisconsin Department of Employee Trust Funds, the National Conference of State Legislatures (NCSL) and the HCTrends Greater Milwaukee Health Care Benefits Survey.

The NCSL data was used to compare Wisconsin state employee benefits with eight other Midwestern states: Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri and Ohio. The HCTrends employer survey data was used to compare Wisconsin state plan costs and design with private?sector employers in southeastern Wisconsin.

The study can be found, here.

Tags: Government Reform, Governor Walker, Health Care, Labor Unions
Posted in News | February 16, 2011 | | 22 Comments

Obamacare Declared Unconstitutional

Legal Community Debates Impact of Individual Mandate

MacIver News Service | January 31. 2011

[Madison, Wisc…] A second federal judge has ruled the recent sweeping federal health insurance reform bill unconstitutional.

READ THE DECISION

In his decision, U.S. District Judge Roger Vinson focused on the law’s “individual mandate,” which required Americans purchase health insurance or face a penalty.

“This has been a difficult decision to reach, and I am aware that it will have indeterminable implications,” Vinson wrote. “Because the individual mandate is unconstitutional and not severable, the entire act must be declared void.”

Officially dubbed the the Patient Protection and Affordable Care Act, the bill is commonly referred to as Obamacare–after the President who exerted a great deal of political capital to get the law passed last year.

Regardless of what side people take on the individual mandate in the new Federal Health Care Law, everyone agrees there is a great deal at stake in the lawsuits filed by 28 states (and assorted interested parties).

The Federalist Society in Madison recently invited supporters and critics of the mandate discuss the issue.

Representative Jon Richards (D-Milwaukee) argued for it. Attorney General J.B. Van Hollen and Illya Somin, George Mason University Associate Professor of Law, argued against it.

The national debate has centered around the interstate commerce clause in the US Constitution, which authorizes Congress to regulate commerce between the states. Arguments surrounding that clause also dominated the debate at the luncheon last week.

Activity Versus Inactivity

Opponents of the mandate argue commerce is an activity. If you do not something that is inactivity, they say. The constitution does not regulate inactivity, and therefore, the commerce clause cannot force one to buy health insurance.

Supporters say that is a technicality. As Richards explained it, the point is a “technical legal conception that conservative members of Congress brought to the attention of the court.”

To Richards the mandate is more about ensuring people do not freeload off of the system, only buying insurance once they need it.

Most Health Insurance Markets Do Not Cross State Lines

Opponents of the mandate point out that even when an individual chooses to buy health insurance, rarely can one purchase it across state lines. That means it does not qualify as “interstate” commerce.

Economic decisions and their impact

Supporters of the mandate say the commerce clause applies to economic decisions that have an economic effect. If one does not buy health insurance, that decision will effect the price of insurance for those that do.

Opponents of the mandate are terrified by that kind of logic.

“The problem with this kind of argument is this can apply to any decision anyone makes of any kind,” said Somin.

Health Care is Special?

Supporters of the mandate state health care is the only service/product a seller is required by law to provide you whether you can pay for it or not. Health care is also something everyone will require at some point in their lives.

Opponents argue this is confusing the issues of health care and health care insurance. Not everyone will need insurance to pay for their health care, and therefore everyone will not use health insurance at some point in their lives. Furthermore, this would be an example of the government imposing regulation on an individual for something they may or may not do voluntarily in the future.

In his decision, Judge Vinson took aim at the individual mandate and rejected arguments that health care is an extraordinary issue.

“It would be a radical departure from existing case law to hold that Congress can regulate inactivity under the Commerce Clause,” Vinson wrote. “If it has the power to compel an otherwise passive individual into a commercial transaction with a third party merely by asserting — as was done in the Act — that compelling the actual transaction is itself “commercial and economic in nature, and substantially affects interstate commerce” [see Act § 1501(a)(1)], it is not hyperbolizing to suggest that Congress could do almost anything it wanted.”

Perhaps in a nod to the ‘Tea Party’ movement that galvanized opposition to the measure, Vinson makes an overt reference to one of the tax revolts that led to the American Revolution.

“It is difficult to imagine that a nation which began, at least in part, as the result of opposition to a British mandate giving the East India Company a monopoly and imposing a nominal tax on all tea sold in America would have set out to create a government with the power to force people to buy tea in the first place,” he wrote.

The debate over the mandate extends beyond the merits of the provision itself. There are also some far reaching implications on what it could allow Congress to do in the future.

It is widely speculated that today’s decision will be appealed. If so, Wisconsin’s Attorney General vows to continue to his efforts.

“Now, we wait to see if the federal government has finally gotten the message,” Van Hollen said Monday. “If they don’t get the message, and decide to appeal the case, as they did when they lost in Virginia, my colleagues and I will continue our fight to defend the Constitution and protect the people of Wisconsin from this unconstitutional law. ”

MacIver News’ Bill Osmulski reports on some of the fears those experts at the luncheon hold regarding any legal outcome:

Tags: 10th Amendment, Health Care, Tea Party
Posted in News | January 31, 2011 | | 1 Comment

School Districts Seek New Insurance Options

Union Fights Switch

MacIver News Service | January 25, 2011

[Waukesha, Wisc…] Wisconsin school districts are saving millions of dollars by switching health insurance providers away from WEA Trust, but the teachers union is not making it easy.

WEA Trust is affiliated with the Wisconsin Education Association Council (WEAC), the union representing some 98,000 employees within Wisconsin schools. The MacIver News Service has learned some districts across the state have discovered they can provide equal coverage at a lower cost through soliciting bids from other companies in the health insurance marketplace.

For example, this year Campbellsport School District switched to the Wisconsin Counties Association’s plan and will save $100,000. The Slinger School District switched to United Healthcare and saved $200,000. Waukesha switched from WEA Trust as well and indicates it will save $2 million.

“United has a larger pool and can provide the same coverage at a much lower price,” said Todd Gray, Waukesha Superintendent.

This trend has caught the attention of the WEAC, and their locals are fighting to stop it. In Campbellsport, the Master Agreement between the union and the district allows the school board to switch insurance providers as long as the coverage is identical. The union there claims the district violated that agreement and filed a grievance and a prohibited practice complaint against the district.

“Since becoming effective July 1, 2010, the change in health insurance carriers has been almost seamless, without any loss in the level of benefits,” Dan Olson, Campbellsport Superintendent, said.

The school board decided to take up the grievance at an August meeting, and publicly posted the item on August 3 to comply with open meetings law. At that meeting, the board decided to take up the grievance in open session.

“In these tough economic times the residents of the Campbellsport School District deserve to know how their tax dollars are being spent, including the efforts the District is taking to save approximately $100,000.00 in costs,” said Jay Miller, Board of Education President.

In the past, similar situations were held in closed session, and the union expected the same in 2010. The union says it wanted to present specific examples of employee health-related situations, which it cannot do in open session since that information is private. The board suggested withholding the specific names to protect their privacy, but the union declined.

On September 22, the union filed a prohibited practice complaint with the Wisconsin Employment Relations Commission, related to the open session meeting.

That had a hearing before an administrative law judge on December 15, but it could be months before a decision in the case is rendered. If it is decided the grievance should have been handled in closed session, then the school board will have to take up the issue again.

The district expects the grievance will eventual go to arbitration, where the burden of proof will be on the union.

Olson said, “They’re going to have to prove the coverage is not equal.”

Olson told the MacIver News Service that other districts are also considering switching away from WEA Trust, but are hesitant.

“I’ve heard from other district administrators who are waiting to see what happens with us,” he said.

Tags: Government Reform, Health Care, Labor Unions, Taxes
Posted in News | January 25, 2011 | | Comments Off

MacIver Study Shows Need for School Districts to Shop Around for Health Insurance

For Immediate Release, January 25, 2011

Local Taxpayers in Wisconsin Could Save Millions

[Madison, Wisc…] A competitive health care marketplace can yield cost savings for school districts across Wisconsin if school board members don’t have a greater loyalty to a particular insurance company than they do to their taxpayers, a new study contends.

An analysis by the John K. MacIver Institute for Public Policy also found that districts who bother to shop around often leave WEA Trust, although it still remains the most popular provider for Wisconsin school districts.

‘Our study’s findings underscore how important it is for every district to shop around for the best health care bargain at every opportunity,” said MacIver Institute President Brett Healy. “Moreover it shows that taxpayer interests are not served by long-term labor agreements which prevent districts from engaging in the vibrant marketplace for health care coverage.”

The study, conducted by the MacIver Institute’s Education Policy Analyst Christian D’Andrea, looked at data provided by the Wisconsin Association of School Boards.

Over the past six years, the average monthly premium cost to districts has risen by over 40 percent.

These inflated prices are a major drain on local school budgets. However, the study indicates they don’t have to be so costly. Data provided by the Wisconsin Association of School Boards (WASB) showed that several districts across the state have been successful at keeping their health care expenses lower and have posted significant savings against the statewide average through careful consumerism. As fiscal responsibility has become more and more important, customer loyalty is beginning to take a backseat to financial savings.

Estimates suggest that if every school district in the state changed their carrier at least once over a six year period, the aggregate annual savings would be over $10.8 million. As more school districts actively shop for better bargains, that figure stands to grow well into the future.

D’Andrea found that six trends emerged when examining the costs and providers amongst Wisconsin’s districts when it came to educator health insurance. They ranged from districts choosing new private vendors over the old guard of WEA Trust to schools saving money by relying on the state employee health care program. However, these trends all pointed to one overarching current – that conscientious school districts can trim costs by shopping around.

While the average teacher health care plan’s price rose over 40 percent for individuals and over 41 percent for families, districts that migrated from WEA Trust to a different carrier saw their costs go up by approximately 25 for individual plans and 29 percent families, respectively.

“These results favor an open market and competitive bidding, with districts taking advantage of emerging carriers and locking into short-term contracts to ensure the best possible rates,” said Healy. “Any district that either doesn’t shop around or agrees to contracts longer than a couple of years may be doing so to the detriment of their taxpayers.”

The MacIver study examined WASB’s data and showcases the good and bad of Wisconsin’s teacher health insurance programs between 2004 and 2010. It found that districts that actively pursued less expensive health care often got it. As a result, more and more private vendors have emerged to service this market, and this has further rewarded frugal school boards.

WASB did not commission the study, approve of the methodology or see the results prior to publication.

Tags: Health Care, Labor Unions, MacIver Institute, Spending
Posted in mi reports | January 24, 2011 | | 2 Comments

First two Special Session Bills Head to Governor

MacIver News Service | January 20, 2011

[Madison, Wisc…] Just over two weeks after he was sworn in as Wisconsin’s 45th Governor, Scott Walker enjoyed his first legislative victories. On Thursday two of his seven proposals to improve Wisconsin’s business climate passed in the special session.

Those bills included a sweeping tort reform proposal and a bill to give tax credits for health savings accounts. The HSA bill passed the Senate on a bipartisan 21-12 vote.

“The cost of health care is one of the top impediments to creating jobs, and I’m proud that one of the first things we did this session will help tackle that problem,” Scott Fitzgerald, Senate Majority Leader, said. “The other side still seems to think the government is the only one that can create jobs, but that’s simply not how it works in the real world.”

The Assembly debate over the tort reform legislation went well into the evening. It approved the Senate version of tort reform by a 57-36 vote around 7 pm.

“Improving our state’s legal climate is important to creating an environment that allows the private sector to create jobs,” said Walker. “The lawsuit reform package passed by the legislature will bring much needed reforms to our legal system, so we are no longer known as the ‘Alabama of the North.’”

The Assembly also took up the Senate Bill concerning health savings accounts, tabling its own bill. That bill was passed on a bipartisan vote of 66-28, around 8:15 pm.

Earlier that afternoon the Assembly also passed two other bills. Assembly Bill 3 gives tax breaks to businesses moving to Wisconsin, and Assembly Bill 4 increases economic development tax credits. The Senate could take up those bills when its back in session next week.

Assembly Democrats generally argued against the bills claiming they had nothing to do with job creation. They also tried to make the case that the bills were being rushed, even though they were introduced over two weeks ago.

“Bills that address the economic emergency in this state, bring it on immediately,” said Assembly Democratic Leader Representative Peter Barca (D-Kenosha). “But bills that have nothing to do with job creation in February, March, and April. They should not be before us.”

Assembly Democrats introduced dozens of amendments to the bills on Thursday, all of which failed.

There are still three more special session bills awaiting legislative action, including proposals to replace the Department of Commerce with the new Wisconsin Economic Development Corporation, and another requiring a supermajority vote from the legislature to raise taxes.

Both houses of the legislature are back in session on Tuesday.

Tags: Governor Walker, Health Care, Lawsuit Abuse, State Legislature
Posted in News | January 21, 2011 | | 1 Comment

Wisconsin Officially Requests to Join Suit Against Obamacare

MacIver News Service | January 19, 2011

[Madison, Wisc…] Wisconsin has officially took the first step to join the multi-state lawsuit alleging parts of the national healthcare bill are unconstitutional.

Iowa, Ohio, Kansas, Wyoming and Maine are also requesting to join the suit, which would bring to 26 the total number of states challenging the law in the United States District Court in Florida.

“The Constitution places limits on the power of the federal government, and these limits must be defended or they will disappear,” said Wisconsin Attorney General J. B. Van Hollen. “Never before has the federal government required an individual to either buy government-approved insurance or pay apenalty. And nowhere does the Constitution authorize Congress to regulate in this manner.”

Van Hollen’s office says the Amended Complaint challenges two main features of the Act: (1) the “individual mandate,” which requires that by 2014 U.S. residents must purchase government approved health insurance or face a tax penalty; and (2) conversion of Medicaid into a federally-imposed universal health care regime.

After the Patient Protection and Affordable Care Act was signed into law last year, 13 Attorneys General filed a lawsuit against the U.S. Department of Health and Human Services, U.S. Department of Treasury and the U.S. Department of Labor alleging the Health Care Reform law signed by the President was unconstitutional.

The amended complaint currently features 20 state plaintiffs; additionally, the National Federation of Independent Business (NFIB) joined the lawsuit as a co-plaintiff on behalf of its members nationwide.

On the day that Scott Walker was sworn in as Wisconsin’s 45th Governor, he granted Attorney General JB Van Hollen the authority to pursue such legal action. Former Governor Jim Doyle had denied Van Hollen’s earlier request to join the suit.

See an earlier interview with Van Hollen regarding Wisconsin’s participation in the lawsuit:

Tags: 10th Amendment, Free Market, Health Care
Posted in News | January 19, 2011 | | 1 Comment

Citizen’s Guide to Health Care Lawsuit

Wisconsin to Fight Costly, Unconstitutional Obamacare

The federal government, as a part of the national health care legislation passed in 2010, is attempting to mandate that every American purchase individual health insurance, or face a penalty.

This is an unprecedented usurpation of states and individual rights for which there is no basis within the Constitution and no precedent in legislative or legal history.

Immediately after the Patient Protection and Affordable Care Act was signed into law, 13 Attorneys General filed a lawsuit against the U.S. Department of Health and Human Services, U.S. Department of Treasury and the U.S. Department of Labor alleging the Health Care Reform law signed by the President was unconstitutional.

On the day that Scott Walker was sworn in as Wisconsin’s 45th Governor, he granted Attorney General JB Van Hollen the authority to pursue such legal action.

A citizen’s choice not to purchase health insurance cannot be interpreted as an activity of any kind, much less an activity subject to regulation under the Constitution’s Commerce Clause. The government has no more authority to force you to purchase insurance than it does to purchase a Chevrolet, or a toaster.

Insurance is not pre-paid health care. Insurance is but one of several ways to pay for health care services. It is a contract between two parties that allows the insured save over time with a commensurate promise that the insurance company will, per the contract, pay for covered health care services.

The United States government has no constitutional authority to force all Americans to enter into a contract of this nature with a private entity. The government has no more authority to force you to enter a contract with an insurance company than it does to force you to hire a lawn care service, or to create a will.

The lawsuit, filed in the federal court’s Northern District of Florida on March 23, alleges the new law infringes upon the constitutional rights of Floridians and residents of the other states by mandating all citizens and legal residents have qualifying health care coverage or pay a tax penalty. By imposing such a mandate, the law exceeds the powers of the United States under Article I of the Constitution. Additionally, the tax penalty required under the law constitutes an unlawful direct tax in violation of Article I, sections 2 and 9 of the Constitution.

The lawsuit further claims the health care reform law infringes on the sovereignty of the states and Tenth Amendment to the Constitution by imposing onerous new operating rules that individual states must follow as well as requiring the state to spend billions of additional dollars without providing funds or resources to meet the state’s cost of implementing the law. This burden comes at a time when states across the nation face severe budget cuts to offset shortfalls in an already-strained budget.

Click here for a PDF of this hand out.

Tags: 10th Amendment, Government Reform, Health Care
Posted in mi fast facts, mi reports | January 11, 2011 | | 2 Comments

Federal Judge Rules Against Federal Health Care Bill, Wisconsin Still Expected to Move Forward on Suit

[Madison, Wisc...] Wisconsin’s efforts to repeal provisions of the recently-passed federal health care reform bill are not likely to be impacted by a federal court ruling Monday.

“Wisconsin’s involvement is as important now as ever,” said Wisconsin Attorney General J.B. Van Hollen. “I look forward to receiving authorization from Governor-elect Walker when he takes office to allow Wisconsin to defend the state and its citizens against the federal government’s unconstitutional overreach.”

Earlier today, US District Judge Henry Hudson (VA, Eastern District) ruled that the individual insurance mandate included in the bill, often referred to as Obamacare, was unconstitutonal.

“The unchecked expansion of congressional power to the limits suggested by the Minimum Essential Coverage Provision would invite the unbridled exercise of federal police powers,” Judge Hudson wrote in a 42-page opinion.

Several states have pursued legal action against the federal health care reform bill. In all more than 20 lawsuits have been filed against the legislation. However, Monday’s decision, in a case brought forward by Virgina Attorney General Ken Cuccinelli, was the first successful challenge. Earlier, two of the lawsuits were met with rulings favoring the Obama Administration. The law is not rescinded, however, as the ruling is one of several in a multi-front legal battle that is likely headed to the Supreme Court.

“Our federal government is one of limited, enumerated powers,” said Van Hollen. “Congress’ action here was unprecedented, and as found by the District Court, unconstitutional. While health care reform can be an appropriate object of congressional action, it must be done in a manner consistent with our Constitution.”

Van Hollen tried to block the individual mandate in March of this year.

“Based on my preliminary review of the Act, I have concluded that a sufficient legal basis exists to contest the individual mandate to carry health insurance or pay a penalty under the Act,” Van Hollen (R) wrote in a letter to Governor Jim Doyle (D), and legislative leaders at the time.

However, Van Hollen failed in his effort to have Wisconsin join a multi-state lawsuit against the healthcare reform bill when his request was rebuffed by Governor Doyle.

Since this fall’s elections, things have changed in the Badger State. Governor-elect Walker has said he will authorized Van Hollen to participate in the mulit-state action, which is a separate court filing from the Virginia case upon which Judge Hudson ruled today.

Van Hollen said his arguments will at times mirror those made by Judge Hudson in today’s ruling.

“The Court’s concern is the same as mine: Congress has exceeded its Commerce Clause powers when it passed a law compelling individuals to involuntarily purchase a commodity, or face a penalty,” said Van Hollen. “In this case it is insurance. In another it could be a car or another commodity. Such regulation is beyond Congress’ lawful powers.”

Tags: Governor Doyle, Health Care, Transition 2010
Posted in News | December 13, 2010 | | Comments Off

Health Insurance Choices Down, Costs Up

We all remember candidate Barack Obama’s promise, “There is no doubt that we must preserve what is best about our health care system, and that means allowing Americans who like their doctors and their health care plans to keep them.” Candidate Obama also warned that if a federal health care law was not passed, “premiums will climb higher, benefits will erode further, and the rolls of uninsured will swell to include millions more Americans.”

Unfortunately Americans are learning that the promises of candidate Obama are not matching up to the reality under President Obama. The effects of the federal health care law may still be in the earliest stages, but we can see where the trend line is going.

Already businesses and insurance companies are reporting health insurance premiums are going up. A recent survey of Milwaukee-based employers indicated that 64% of companies with 100 or more employees are facing insurance premium increases of 2% or more due to the federal health care law. Fourteen percent are reporting the new requirements of the federal health care law will add more than 4%, according to a survey conducted by HCTrends.

Costs for health insurance premiums are going up because of federally mandated increased coverage. Half of those surveyed by HCTrends said federal mandates for “the elimination of lifetime caps, the addition of free preventive care and mandated coverage for children up to age 26 will add between 2 and 4 percentage points to their 2011 rates.”

That is if they keep the same insurance. Forty percent of those surveyed said they were “seriously considering” changing networks or health plans. This seriously undermines the promise that Americans will get to keep their insurance plans and their doctors if they are currently satisfied with their health care.

Unfortunately, the situation is only going to get worse. Some insurance companies are looking to get out of certain types of health care coverage altogether. This will reduce choices for American health care consumers and will result in many Americans losing the health care providers they currently are satisfied with.

For example, Aetna will stop selling insurance to small groups in Colorado next year. Aetna, Cigna, WellPoint, and other insurance companies will stop selling child-only insurance in certain states next year.

The New York Times reports this is part of a larger trend of smaller insurance companies not having the resources and economies of scale to remain competitive. Once the health insurance market is concentrated into a smaller number of companies, prices could go up even more, even as more Americans are no longer in the health insurance plans they preferred before the federal health care law passed.

Some worry that companies could begin to drop health care coverage altogether under the new federal health care law. As we saw recently when McDonald’s was granted a waiver by the federal government, many companies may decide to opt out entirely of providing insurance to their employees as the new federal mandates go into effect.

The federal health care law penalizes employers that drop their health care coverage $2000 per employee. Employers may look at that number and decide that it is not enough of a deterrent. James Klein, president of the American Benefits Council, even said to the Associated Press that the federal health care law could begin to dismantle the employer-based health insurance system.

While the White House disagrees, claiming the new law actually encourages employers to offer health insurance coverage, Democratic Tennessee Governor Phil Bredesen predicts that the new exchanges that begin operating in 2014 will make dropping insurance coverage an attractive option for employers, including in the public sector.

Bredesen, in an op-ed for the Wall Street Journal, said that not having coverage would be especially attractive to new business start-ups.

“For a person starting a business in 2014, it will be logical and responsible simply to plan from the outset never to offer health benefits. Employees, thanks to the exchanges, can easily purchase excellent, fairly priced insurance, without pre-existing condition limitations, through the exchanges. As it grows, the business can avoid a great deal of cost because the federal government will now pay much of what the business would have incurred for its share of health insurance. The small business tax credits included in health reform are limited and short-term, and the eventual penalty for not providing coverage, of $2,000 per employee, is still far less than the cost of insurance it replaces.”

So under the federal health care law, Americans will have higher insurance costs, and it is very likely they will not be able to keep the insurance plans or the doctors they preferred before the federal health care law went into effect. We are already seeing the beginning of this trend in Wisonsin’s largest city, and the final result could be the end of employer-based health insurance, according to a member of the president’s own party. That’s completely different than what was promised before the health care law was passed. Perhaps House Speaker Nancy Pelosi was correct when she said that the law would have to be passed before we knew what was in it.

By James Wigderson
Special Guest Perspective for the MacIver Institute

Tags: Health Care, Wigderson
Posted in mi perspectives | November 1, 2010 | | 1 Comment

Posts Tagged ‘Health Care’