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In the speech President Obama gave responding to Congressman Ryan’s budget plan (the one in which he lured Ryan to sit in the front row in order to be publicly pilloried), the President did something DrRich did not think he would do before the next election. He openly invoked, and openly embraced, the Independent Payment Advisory Board (IPAB) as the chief mechanism by which Obamacare will control the cost of American healthcare.

“IPAB” might be a new term to many Americans, but DrRich pointed his readers to this entity, within a few weeks of the passage of Obamacare, as the lynchpin (and a very scary lynchpin at that) of the whole enterprise.

Until President Obama’s recent “outing” of IPAB, however, this new board has been almost entirely ignored by most commentators. Since the President’s speech, of course, many have written about it, either to celebrate it or to castigate it. (Of all these commentaries, DrRich most highly recommends the analysis provided by Doug Perednia at the Road to Hellth. In fact, DrRich recommends Perednia in general, as he is regularly producing some of the most insightful commentary, anywhere, on health policy.)

DrRich does not wish to simply repeat here all the observations that have lately been made by others regarding the IPAB. Rather, he will emphasize three particular features of the IPAB, features which are remarkable indeed, and which will tell us something very important about our Progressive leaders.

Three Remarkable Features of the IPAB

1) It has dictatorial powers.

The IPAB is a 15-member board appointed by the President.  Section 3403 of the Obamacare legislation tells us that the purpose of this board is to “reduce the per capita rate of growth in Medicare spending,” a noble goal indeed. Furthermore, in a superficial reading of Section 3403, one might think of the IPAB as a sort of Mr. Rogers of healthcare – a mild-mannered, friendly, always-helpful, but ultimately undemanding agent for good. This is the impression imparted by the first few paragraphs of the Section, which paint the new entity as an “advisory” board, whose main task is to develop “proposals” and “advisory reports,” which “proposals” and “advisory reports” would solely consist of various “recommendations,” that ought to be “considered” for the purpose of cost reduction.

Indeed, one might get the impression that the main difference between the IPAB and DrRich (another Mr. Rogers-like, mild mannered and undemanding personage) is that the former is appointed by the President and has a travel budget.

Nothing could be further from the truth. The IPAB is actually all-powerful.

Once the Chief Actuary of CMS determines that the projected per capita growth rate for Medicare exceeds a certain target growth rate (which it inevitably will), the IPAB is required to submit a so-called “proposal” which will cut healthcare costs sufficiently to bring the growth rate back in line; which is to say, the IPAB will determine what will be paid for and what will not. Then, the Secretary of HHS is required to implement that “proposal” in its entirety, unless Congress acts to block implementation. However, Congress is hamstrung.  The representatives of the people are forbidden from taking any action “that would repeal or otherwise change the recommendations of the Board,” unless it replaces those “recommendations” with its own legislation that would cut healthcare spending to the same target level.

For all practical purposes, then, the cost-cutting “recommendations” which the IPAB would “propose” for “consideration” will be implemented nearly automatically, with the full authority of the Federal government.

And, for all practical purposes, the IPAB will become a new agency of the executive branch, with near-dictatorial authority to cut healthcare spending where and when and for whom it sees fit.

2) It will control all healthcare spending, not just Medicare spending.

A common accusation, heard these past few weeks from conservative commentators, is that the secret desire of the President and his supporters is to make it so that the IPAB will have these same dictatorial powers over not just Medicare, but over all healthcare spending – public or private. DrRich believes these conservative commentators are unnecessarily accusing the President of being conspiratorial. In truth, no conspiracy is necessary, as this result is already law.

DrRich recommends that these conspiracy theorists read the actual legislation. It is a bit difficult to sort out, but in fact the IPAB is already granted the authority to control private as well as public healthcare spending.  It got this authority in a suitably convoluted way.

Those who paid attention to the remarkable process that brought us our new and transformational healthcare system might recall that the Senate bill, which ultimately became law of the land, was never designed to be actually implemented. It was designed solely to assure 60 votes in the Senate, after which the Joint Conference with the House was to meld the House Bill and the Senate Bill into a workable law.

As part of the negotiations to gain those original 60 votes in the Senate, five or six Democrat Senators went behind closed doors to cobble together a list of amendments to the original Senate Bill – the so-called Manager’s Amendments. It is in the Manager’s Amendments that one can find such famous niceties as the bribes paid to Nebraska in order to obtain an extra vote. But the Manager’s Amendments (which, contrary to the expectations of the actual Managers, are now part of our new healthcare law) contained lots of other stuff as well.

One of the more interesting parts of the Manager’s Amendments (Section 10320) is entitled, “Expansion Of The Scope Of, And Additional Improvements To, The Independent Medicare Advisory Board.” (The original language in Section 3403 did not actually create something called an IPAB – it created an IMAB. The Manager’s Amendments re-christened it as the IPAB, as explained below.)

Section 10320 (which can be found way down on page 2210 of the new law) grants the IPAB (beginning in 2015) the authority to limit all healthcare expenditures, that is, all healthcare expenditures, and not just expenditures by Medicare or government-run programs.

To emphasize this expanded authority, Section 10320 changes the name of the “Independent Medicare Advisory Board” (created in Section 3403) to the “Independent Payment Advisory Board.” It directs the IPAB, at least every two years, to “submit to Congress and the President recommendations to slow the growth in national health expenditures” for private (non-Federal) healthcare programs. Furthermore, it designates that these “recommendations” may be implemented by the Secretary of HHS or other Federal agencies “administratively” (that is, without the interference of Congress).

The justification for this expansion of the IPAB’s authority is that controlling private healthcare expenditures will directly impact Medicare, since the “target” Medicare growth rate which the IPAB is charged with achieving will be determined by overall healthcare expenditures. Therefore, it is necessary to control those private expenditures. More practically, if Medicare patients (who are subjected to arbitrary cost-cutting measures) see their younger counterparts enjoying less restricted healthcare, we old farts are likely to become inconveniently rowdy.

Once the Managers had devised enough paybacks in the Managers’ Amendments to get the needed 60 votes, and the law finally passed in the Senate, President Obama and his Congressional allies, Mr. Reid and Ms. Pelosi, determined that allowing the new law to go to Joint Conference would be counterproductive (in particular, they would undoubtedly have lost Section 10302 if the House Democrats ever saw it). So the entire Congress was coerced into voting on the bill as passed by the Senate – including all the Managers’ Amendments – under the reasoning that passing the law right then was a manifest emergency.  And Congress, like the rest of us, could find out what was in it after it became law.

We are likely to hear grumbling from even some House Democrats as the real implications of the IPAB become more apparent to the public, since the House Democrats really didn’t get an opportunity to vote on (or read) this provision, except as part of an “all or nothing” healthcare reform bill.

Whatever. While the IPAB may begin by only controlling the cost of Medicare, it already has the authority to control all healthcare spending, including private spending. That’s you, dear reader. No further legislative action is needed.

3) It is an immutable entity.

Section 3403, the section that creates the IPAB and spells out its functions, contains some remarkable language that, DrRich suspects, has never been seen before in American legislative history. To wit:

“It shall not be in order in the Senate or the House of Representatives to consider any bill, resolution, amendment, or conference report that would repeal or otherwise change this subsection.”

So, the astounding truth, dear reader, is that the IPAB and all its designated dictatorial functions are in force for perpetuity. Our Congress has passed legislation that purports to bind all future Congresses from altering it in any way.

We can surmise from this fact that those who wrote this law must consider the IPAB to be very, very important. Of course, we know this because President Obama said so just the other week. However, what many Americans may not yet realize is that the IPAB provision of Obamacare must necessarily be not only the most important feature of our new healthcare system, but also the most important legislative provision ever written. We know this because no other provision has ever received such extraordinary protections from any future alterations whatsoever.

DrRich asks his readers to bask in the utter audacity of our current crop of leaders, leaders who are so sure they know what’s best for us that they were willing to engage in all manner of legislative legerdemain to pass Obamacare, not only against the apparent expressed will of the people, but also (as it turns out) against the objections any future American Congress may have that is sent to Washington by those people.

Not even our Constitution itself – a document that attempted to establish a government for all time – was as audacious as this. For the Constitution, at least, provided a mechanism for its own alteration.

As DrRich racked his brain to think of the last time a law was promulgated with such audacity – not with the audacity of hope, but the audacity of perpetuity – he initially drew a blank. Even monarchs who purported to reign under Divine Right understood that future monarchs, who would also rule under the same God-given right, might thus alter any laws they made.

DrRich believes we need to go all the way back to Moses, coming down from Mt. Sinai and holding aloft his awesome Tablets filled with divine writ, to find a law or set of laws that, from the moment they were written, were decreed to remain in force for ever and ever.

Only God has ever tried this before.

What Does This Tell Us About Progressives?

DrRich has gone on at some length about the Progressive program and the Progressive mindset. The creation of the IPAB, its configuration, and the manner in which it was created, simply reflects that program and that mindset.

Progressives are dedicated to “progressing” to a perfect society, and they know just how to achieve it. Unfortunately, a whole bunch of people – not merely right-wingers and a few Republicans, but most of the masses – just don’t see it their way. Specifically, the Progressive program requires individuals to subsume their own individual interests to the overriding interests of the collective – and human nature just doesn’t function that way.

Thus, the Progressive program inevitably relies on a cadre of elites – those who have dedicated themselves to furthering the Progressive program – to set things up the right way for the rest of us, while manipulating we in the teeming masses to let them. And the rest of us, once the correct programs and systems are in place, will at last understand that it was all for our own good. (Those of us who still don’t get it, to extrapolate from the actions of various collectivist governments of the past century, will either have to be re-educated or eliminated.)

The IPAB would serve as an ideal poster child for the Progressive program. It is an all-powerful commission of experts, appointed by Progressive leaders, which will make decisions based on only the “best” available data (and they are the determinants of what is “best”), that deeply affects the lives of every individual American, whatever the decisions might be that individuals would have made for themselves.

The manner in which the IPAB was created is a model for the Progressives. It involved manipulating the body of government that the Progressives find most problematic – the Congress, the voice of the people – and entirely marginalizing it.

The immutability of the IPAB is also a Progressive dream. Congress was manipulated into creating an all-powerful entity which it (the voice of the people) is enjoined from ever altering, down into perpetuity.  The IPAB is forever within the control of the executive branch, which the Progressives, of course, intend to hang on to at all costs.  (And, if lost, is relatively easy to regain.)

The fact that President Obama has at last brought the IPAB out of the closet, and has deemed it to be ready for public scrutiny, indicates that he is confident that the people will not understand the profound nature of what has been accomplished by the establishment of such an entity, or if they understand, will still be indifferent about it.

DrRich dearly hopes the President is wrong about this.

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A well-known Progressive blogger has taken issue with this post – and with DrRich.  See DrRich’s reply to said well-known blogger, here.

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When Congressman Ryan released the House Republican budget plan a few weeks ago, he made it clear that he believed his proposal would engender a vigorous reaction from the Progressive leadership of our government. He further expressed the hope that such a reaction would at last engage both sides in a real debate about how to reduce our crushing federal deficit, which is growing fast enough to promise societal disintegration within a generation or two.

So when President Obama subsequently announced that he was giving a speech that would articulate a meaningful response to the Ryan proposal, and invited Congressman Ryan and some of his Republican confederates to attend, the Republicans respectfully showed up and sat in their designated front row seats, expecting, they said, to hear the President lay out some common ground for tough but necessary negotiations on reducing our debt.

Of course, that is not what happened. The President’s tone was righteous, accusatory, uncompromising. He ripped Ryan and colleagues each a new one, accusing them of attempting to “end Medicare as we know it,” and of trying to balance the federal budget by throwing old people under the bus, and depriving them of their God-given right to healthcare. While I am President, he indicated, the Republicans will never succeed in their efforts to break the social compact we have made with our elderly citizens. Never! (And through the whole speech, there the hapless Republicans sat, fidgeting with increasing discomfort and dismay – the self-satisfied perpetrators of this dastardly plan, the unfeeling tools of the wealthy and special interests – right there in the front row.)

After the speech, Congressman Ryan described himself as supremely disappointed by the President’s words and his tone. Ryan clearly felt he and his Republican friends had been set up by the President’s invitation, and had been maneuvered into attending their own lynching.

DrRich is disappointed, too – not by the President’s speech (which DrRich could easily have written for him) – but by Ryan’s apparent surprise. It occurs to DrRich that members of the President’s opposition simply do not understand where he is coming from, or how to deal with him. This is a very scary thought.

President Obama’s response to Ryan’s budget plan was not offered as an opening position for negotiations. It was, instead, an impassioned statement of First Principles, principles that define the difference between good and evil. There will be no compromise on first principles, no compromise with evil, no negotiations, no taking of prisoners.

This firm, uncompromising and immediate response (with the evil-doers sitting just a few feet away) came from the same President who deliberated for months after commanders in the field begged for an immediate infusion of more troops in Afghanistan, who equivocated for two years over the closing of Guantanamo, who waffled, also for years, on where to try captured terrorists and who should try them, and who allowed the tax rates for 2011 to remain unresolved until the last days of 2010. But this time he was sure of his position, and he was sure of it instantaneously and instinctively, as a matter of principle. His position on this matter is a reflection of his very core.

And what was it about Ryan’s plan that suddenly turned President Obama’s spine to titanium? It was this: Ryan’s plan would require at least some of the elderly to pay for some of their own healthcare.

The Ryan plan, in outline, is to convert the Medicare program to a voucher system, and allow the elderly to purchase their own health insurance from a pool of choices. Ryan has specified that the poor and the sick would receive full healthcare coverage – better coverage (he insists) than they are getting today. But well-to-do elderly Americans would have to carry at least some of their own weight, and to get the coverage they need would have to add their own funds to their federal vouchers. (An oft-ignored point is that anybody currently 55 or over would never be subject to Ryan’s new system, but would continue to receive Medicare as it is today.)

DrRich chooses to ignore for now the fact that the health insurance industry will never go for such a plan, since it requires them to operate under their current, utterly broken business model, and that therefore Ryan’s plan is a non-starter.  It is still an honest and principled attempt at a solution.

Ryan’s plan has the virtue of recognizing the fact that we cannot afford to purchase with public funds all healthcare for all individuals. That’s what is causing our federal debt to skyrocket to catastrophic proportions. And, recognizing that fact, his plan would require some elderly Americans, the ones who can afford it, to contribute their own funds to their healthcare coverage.

Require the rich to pay more. Isn’t this what President Obama has been saying all along?

So why is the President so adamantly opposed to such a thing?

This whole Obama-Ryan kerfuffle is simply a graphic illustration of a point DrRich has made many, many times before. Any Progressive healthcare system, at the end of the day, must attempt to centralize all healthcare decisions, and thus to direct ALL healthcare spending, and therefore, will have to restrict individuals from spending their own money (and making important decisions) on their own healthcare. DrRich has explained why this kind of restriction will be fundamental to Progressive healthcare reform, and he has described some of the steps our government has already taken to implement such restrictions. It is likely true that Progressives will have to make a few minor compromises here and there in order to advance the program as a whole (perhaps, for instance, allowing people to buy their own “alternative medicine” products). But they can never compromise to the extent that the Ryan plan would require.

Obama’s impassioned speech neatly reflects this fundamental precept. For the Ryan plan, or any plan, to not only allow but also require people to contribute to their own healthcare is a mortal sin under the Progressive program. And anyone who advances such a plan is anathema, and must be dealt with harshly. Just as Obama dealt with Ryan.

We are only a tiny step away from having any proposal such as Ryan’s being labeled as hate speech. Heck, after the President’s performance, we may be there already.

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The last two weeks have made clear that the debate over our national debt will play a major role in the next election cycle.

On one side, many Republicans, lead by Representative Ryan, insist that the rate of growth of our national debt – especially the massive projected growth of Medicare and Medicaid – promises to destroy our society within a generation or two; and that the only way to avert that catastrophe is to make substantial structural changes to our entitlement programs. The subtext of their message is: Federal debt is bad, and debt of this magnitude will be fatal.

On the other side, most Democrats, led by President Obama, stress that our entitlement programs are promises that simply can’t be changed in any substantial way, insist that such entitlements are “investments in our future,” and suggest that whatever shortfalls our current system might encounter can be remedied by taxing millionaires and billionaires. The subtext of their message is: Federal debt can be a force for good, and in this case will trigger a much-needed redistribution of wealth (which is a primary goal of Progressives).

The debate over the national debt is as old as the Republic. In the original version of this debate, the part of the modern Republicans (i.e., debt is bad) was played by Jefferson, and the part of modern Democrats (i.e., debt is an investment in the future) by Hamilton.

In the early 1790s, unsupportable debt obligations, accumulated during the Revolutionary War and held by the various states and by private individuals, had entirely frozen up the credit markets, and precluded the brand new United States from having a functioning economy. Hamilton’s idea was for the federal government to buy up all these private and state obligations, and then issue federal bonds to raise enough capital to pay off the debt and to provide stuff, like a United States Navy, that would encourage investment and economic growth. (That Jefferson so viscerally disagreed with this approach, believing that all Americans should grow their own food and make their own clothes, etc., and that a national financial system was not only unnecessary but dangerous, was one of the chief factors that led to the two-party system in the U.S.)

Hamilton ended up doing a deal with Jefferson, and got his way (agreeing to move the nation’s capital southward, where the feds would find it more difficult to undermine some of the south’s more peculiar institutions).  And as a result of Hamilton’s massive and unprecedented bailout of the various states and private investors*, the United States of America became not only one united country, but a stable and growing concern. Indeed, it is arguably by this action that Hamilton definitively earned his place as one of our most important Founding Fathers.

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*Many of the “private investors” who needed to be bailed out turned out to be prominent political figures and supporters of Hamilton, whose names we’ve all heard and revered, and whose shady deals had helped to produce the fiscal crisis in the first place. So there are indeed many parallels to our current situation.
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Clearly, not all national debt is bad. Sometimes, just as President Obama insists, acquiring debt can be an investment in the future.

In fact, Hamilton’s great insight was that national debt can be the engine of economic growth. When the government borrows money to build out the national infrastructure, to provide easier access to markets, to provide easier transportation of goods, to provide easier access to energy, and to provide a stronger military to guarantee that its investments are safe, the government is doing what businesses do when they want to grow. It is borrowing money today that will generate economic growth, and that will, in turn, repay that borrowed money with interest. That’s good debt.

When Hamilton bailed out the various states and the private investors, he was essentially buying up war debt. He was taking upon the federal government the responsibility for paying for the war that had created the United States in the first place. In economic terms the Revolutionary War was like the high-risk start-up that exhausts its funding in creating its product. While the product of their effort (i.e. independence) was intrinsically very valuable, the various states had bankrupted themselves in achieving it. And because the states were bankrupt, commerce was paralyzed, and the new country was about to break up into warring factions. Hamilton saw that by creating a central entity to buy up the debt, and to raise capital against the country’s new independence, he could realize the intrinsic value of the new nation. Hamilton’s debt, because it was truly a catalyst to pent-up economic potential, was good debt. It truly was an investment in the nation’s future, one that paid off for future generations of Americans beyond even his wildest dreams.

On the other hand, when we accumulate national debt not to catalyze a growing economy, but instead to buy consumable products for individuals that the individuals “ought” to be buying for themselves (because they are consuming the products themselves), that’s just debt. It’s like credit card debt – it’s debt that is not paying for itself by stimulating new economic growth for the borrower, but instead it’s debt that will just have to be paid off sooner or later, and that in the meantime requires large payments in the form of interest. Such debt is not an investment in the borrower’s future; it’s not creating future growth that pays for itself. Instead, this kind of debt often compounds until it collapses of its own weight. That’s bad debt.

That’s the kind of debt, for instance, that was created by the mortgage crisis. The federal government has now gone into great hock buying up mortgages taken out by its individual citizens. It is taking steps to help those individuals stay in the houses they cannot afford, and to protect the institutions that made those bad loans. It is not taking active steps to stop the issuing of the sub-prime mortgages that created the crisis in the first place. One of the chief reasons we hear for freeing up the credit markets is so that more sub-prime mortgages can be issued. The notion that all Americans should have access to reasonable shelter is a compelling one. But that’s different from a policy that allows individual Americans to choose their own shelter, from a vast array of choices, and then send the taxpayer the bill.

While going into national debt bailing out the sub-prime mortgages is bad debt, it is nothing compared to our going into national debt buying healthcare for individuals. Our accumulating healthcare debt is really bad debt. According to the GAO, we’re already committed to accumulating $25 trillion to $55 trillion in healthcare debt over the next several decades. Furthermore, when a person “consumes” healthcare, it is well and truly consumed. There’s nothing left (except, for the individual, some chance of prolonged life or less suffering, which is good for the individual but neutral to our national economic health). At least when the government buys up mortgage debt it owns actual real estate, which has some intrinsic worth. Not so when buying up healthcare debt.

So going into massive debt paying for Medicare and Medicaid is not the same as the debt Hamilton took on in the 1790s. We’re merely accumulating debt, and not stimulating future growth. In fact, our irresponsible accumulation of bad debt is stifling economic growth.

So President Obama is correct to the extent that, sometimes, taking on a certain amount of the right kind of debt (the kind that stimulates real economic growth) can be an investment in the future.

But the Republicans are correct that the debt we’re taking on to pay for Medicare and Medicaid is not that kind of “investment,” but is a fiscal black hole – as we will all find out if we don’t get this debate right.

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For some time now, numerous loved ones and dear friends have been advising and occasionally urging DrRich that, perhaps, it has become a bit inappropriate, and even unseemly, for him to continue in his longtime position as President and sole member of Future Old Farts of America (FOFA). For a not unsubstantial interval DrRich ignored this advice, feigning incipient deafness. But finally, after some focused study of that which these days returns his gaze in the mirror, and reluctantly concluding that maybe his loved ones have a point (and not wishing to seem Cranky), DrRich has reluctantly decided to resign from (and therefore disband) FOFA.

DrRich is pleased to announce that he has accepted a new position as President and sole member of Glorious Old Farts of America (GOFA).

And it is in this new capacity that DrRich has become alarmed at some of the dire warnings now being sounded by respected leaders of the Democratic Party, to the effect that the Republicans’ proposed federal budget for fiscal year 2012, released last week by Congressman Paul Ryan (who serves, DrRich believes, as Deputy Whippersnapper of the House Republican caucus), proves that Republicans are trying to kill old people.

Article 3, Subsection 4(D) of the GOFA charter clearly states: “All things being equal, we would prefer that Old Farts not be killed.”

Therefore, as President of GOFA, DrRich feels obligated to make some sort of public response to the Ryan budget, and to our ever-vigilant Democrat friends’ assertion that it is aimed at producing lethal harm to old people. DrRich’s important position in GOFA, of course, means that his opinion on this matter ought to carry serious weight in any high level discussions about this proposed budget.

By carefully studying the thoughtful commentary being offered by GOFA’s Democrat friends, DrRich has ascertained that Ryan’s proposed budget apparently will kill old people by “ending Medicare as we know it.”  DrRich does not find this a compelling argument, since Medicare as we know it is already being ended, by Obamacare, which is now the law of the land. Strangely, Democrat leaders are not claiming that Obamacare also kills old people.

So, as is all too often the case, the logic being offered up for public consumption by our political leaders does not hold up to simple analysis, which places DrRich into the position of having himself to provide the logical analysis of the question at hand.

DrRich, to be clear, frames that question thusly: Which plan for Medicare most threatens to kill old people? And he finds abroad in the land three distinct plans for Medicare: Medicare “as we know it,” Medicare under Obamacare, and Medicare under the Ryan budget. Let us analyze dispassionately how each proposes to kill the elderly.

Medicare As We Know It. Medicare as it is being operated today is generally popular with GOFA’s constituency, and most old people would like to continue things just as they are. And if you are one of those elderly Americans who is above, say, 75 years of age, chances are you would do just fine under Medicare as we know it. That is, odds are that you would live out your allotted years, and finally die from your heart disease or cancer only after enjoying every modern contrivance our healthcare system has devised.

However, if you are substantially younger than that, there is a real chance that your demise will be related to more systematic causes. This is because Medicare, if it were to continue just as it is today, would drive the U.S. into insolvency within a couple of decades, leading to cultural collapse, societal upheaval, &c. Our modern healthcare system (any modern healthcare system), being totally dependent upon a robust, complex, reasonably stable and technologically advanced society, would cease to exist. All of today’s life-prolonging therapies would either become very scarce, or would disappear altogether. And unless there arises out of the ashes a new culture which is centered upon ancestor worship, odds are that what little healthcare is available would not be disproportionally offered to the very old.

As DrRich sees it, continuing Medicare as we know it would ultimately result in most of our elderly dying much earlier than they do today.

Medicare Under Obamacare. Obamacare promises to prevent a Medicare-induced societal collapse by centralizing virtually all healthcare decisions, thus controlling expenditures. Government-appointed “experts” will decide which medical services ought to be offered to which patients, and will publish those decisions as “guidelines” (a euphemism for “directives”), which will be followed to the letter by doctors who wish to continue their careers and stay out of jail.

DrRich has argued herein that such a system will do great harm to many individuals in all age groups, and will effectively end the Great American Experiment. (Unlike some, DrRich would consider this latter result to be a bad thing.) But our question at the moment is more focused: Will old people be killed disproportionally under Obamacare?

DrRich thinks the answer is yes. First, “guidelines” have the most merit when they are applied to patients whose only (or main) disease is the one to which the guideline applies. For patients with multiple serious ailments, or who are beginning to suffer from various motor and sensory disabilities related to aging, the response to (or ability to follow) standardized treatment directives may be far less than supposed. The reduced ability of doctors to tailor therapy to individual needs (without incurring the undifferentiated wrath of the Central Authority) may thus prove particularly harmful to the elderly.

Second, our leadership class has already anticipated that merely centralizing all healthcare decisions will be insufficient to avert a fiscal disaster, and that more stringent controls will have to be employed. While they do not like to discuss such contingencies publicly, when they do, they make it clear that the elderly will have a reduced priority for healthcare services. That is, there will be age-based rationing.

Third, it is plain that Obamacare will attempt to make it illegal for elderly Americans (or any Americans) to go outside the system to purchase their own healthcare. Old farts will get what the Central Authority says they will get, and nothing more.

DrRich believes Obamacare would end up being pretty tough on the elderly, and that many old people will die earlier than they would die today.

Medicare Under The Ryan Plan. The Ryan plan offers to allow anyone who is 55 or older to remain on Medicare as we know it today. For those currently younger than 55, when they reach the age of Medicare they will be given a suite of health insurance plans to choose from, and will be given a certain amount of money by the government to use to support their premiums. This system is quite similar to that currently offered to many federal employees.

The amount of premium support will be based on the wealth of the individual. The poor and the sick, Ryan insists, will get full premium support, and indeed will end up with “better” health insurance than they would get today under Medicare. Wealthier individuals will have to pay a much higher proportion of their own insurance premiums.

The Ryan plan in its current form is little more than an outline, and DrRich would need to see details before feeling warm and fuzzy about it. But fundamentally it takes medical decisions away from a Central Authority and places those decisions back into the hands of patients. Further, it not only allows but insists that people (who can afford it) spend at least some of their own money on their own healthcare. Also, patients under the Ryan plan will be legally permitted – even encouraged – to purchase any additional healthcare they want, any time they choose. This plan restores individual autonomy (and its twin, individual responsibility) to American healthcare.

Undoubtedly, the insurance companies under the Ryan plan would be no less evil than they are today, and would do harm to patients every chance they get. But (as DrRich has amply demonstrated) so will the Feds, and it is far easier and far less dangerous for doctors and patients to fight insurance companies than the Central Authority.*

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*DrRich hastens to remind his readers that health insurance companies will want no part of a plan such as Ryan’s. Ryan’s plan would require these companies to continue operating under their current, broken business model. After fighting so hard for Obamacare (which converts insurance companies essentially to public utilities), the insurance industry will not give up its victory without a fight – especially if doctors keep insisting on publishing articles showing that old farts can do just fine after receiving intensive medical care. DrRich thinks the health insurance industry will watch the progress of the Republicans’ budget proposal carefully, and if they perceive it has any chance of success, will do whatever they need to do to stifle it.
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Would elderly people die earlier under the Ryan plan? Those who are deemed wealthy enough to contribute to their own health insurance premiums, and who as a result choose to become under-insured, may certainly die earlier. DrRich supposes this is what the Democrats mean by “killing old people,” since he can find no other rationale to support such a statement.

The Bottom Line. Ultimately, the worst thing that could happen to us old farts would be for the current Medicare system to continue as it is, without any meaningful fiscal reforms. The two other plans for Medicare both promise to control government expenditures on healthcare, and thus promise to avoid the societal collapse (and mass elderly casualties) that likely would be produced by doing nothing.

Obamacare accomplishes this by placing healthcare decisions into the hands of government-chosen “experts” who will determine the management of individuals from a great distance, and by giving the elderly a lower priority in unavoidable rationing schemes.

In contrast, the Ryan plan proposes to avert catastrophe by placing elderly individuals in the position of having to choose (and in many cases partially pay for) their own health insurance product, and then live with those choices.

Speaking on behalf of the entire GOFA organization, DrRich would rather his fellow old farts die as a result of their own personal choices in a plan like Ryan’s, than die as the first victims of the societal upheaval, or through the tyranny, promised by the other two options.

DrRich trusts that his position as President of such an august organization will render his opinion in this matter dispositive.

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Health insurance premiums all over the country are rising at rates that, only a year ago, were rare, and when they occurred, provoked angry and threatening letters from Secretary Sebelius. Increases in premiums of 40% are not uncommon this year, and businesses across the land (which otherwise might be inclined to do their patriotic duty, as defined by President Obama, and hire some people) are suffering because of it.

Republicans, of course, already smell blood in the water. A federal judge has declared Obamacare – the entire law – to be unconstitutional, and has given the administration only a limited time to apply for a stay of his ruling. President Obama himself seems to be faltering on the individual mandate, telling states that they can forgo this mandate – if, that is, they can come up with an alternative plan that does everything the President claims Obamacare is supposed to do.*

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*States can’t really accomplish this, of course, so the President’s offer is empty. DrRich thinks that he is advancing this idea in order to make the argument, in court, that the mandate is not really a mandate, since, as he’s just made plain, it’s merely an option.
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And now, Republicans gleefully point out, thanks to Obamacare health insurance premiums are rising faster than they ever have before, at rates that threaten to make our jobless recovery remain jobless forever. “Look at the damage Obamacare is already doing,” they’re telling us, “and most of its destructive provisions don’t even kick in for three more years.” The increase in insurance premiums will soon be felt – directly or indirectly – by every American who has health insurance. It will be a huge boost, Republicans think, to their efforts to get rid of Obamacare.

In an action that will undoubtedly surprise those many experts who persist in believing that Obamacare represents a major defeat for insurance companies (and who therefore must live in a perpetual state of surprise regarding many things about the healthcare system), the insurance industry is vociferously denying that their current premium increases have anything to do with Obamacare. According to the New York Times, for instance, Vincent Capozzi, an executive at Harvard Pilgrim, insists that only 1% of the premium increase this year is caused by Omabamacare (mainly its requirement for free coverage of preventive services). The insurance industry, according to the Times, maintains that “premiums are rising primarily because of the underlying cost of care and a growing demand for it.” That is, the cost of healthcare is accelerating thanks largely to our aging population and the adoption of expensive new technologies.

Whatever it is that’s making premiums go up, the industry asserts, it’s not Obamacare.

To understand what’s really going on here, DrRich asks you, Dear Reader, to put yourself in the place of a health insurance CEO in early 2011. After a long, hard fight, in which you had to debase yourself in public several times (in order to play your assigned role of Villain in the Obamacare set-piece), you are now a mere 33 months from Nirvana. In January, 2014, the individual mandate kicks in, and you will reap your reward of tens of millions of new subscribers, subsidized by the government, and thus you will have your long-coveted One Last Windfall. A year or two after that, once you have blown through this last windfall, you will become a public utility. It is not a glorious ending to your once-arrogant industry, but it is far better than the oblivion which otherwise would be your fate.

Common wisdom (such as that employed by most of those perpetually nonplussed “experts” to whom DrRich previously referred) might suggest that your best course would to be to lie low for the next 33 months, to remain as unobtrusive as possible so as not to upset the apple cart, in a word, to keep any increases in your premiums down to an unremarkable rate. But you are smarter than that. You understand that while instituting outlandish premium increases at this juncture is indeed risky, you’re still walking a tightrope, and keeping your premium increases to a more reasonable level is equally risky.

There are two good reasons for you to raise your rates right now to a truly stunning degree. First, of course, you only have three more years to control your own insurance premiums. Once Obamacare is fully actuated, and the mandates are applied, stringent controls will be placed forevermore on your ability to raise your premiums. So naturally, you need to establish as high a baseline as possible during these next three years.

Perhaps more importantly, you need to place a shot across the bow of the Republicans. You need to let them know that if they manage to repeal Obamacare, either legislatively or through the courts, they will have a tiger by the tail. “Just look at us!” you are saying. “Today, before Obamacare even kicks in to any appreciable degree, we are forced to engage in these truly ridiculous premium increases. Increases like this will drive subscribers from our rolls, and will bring the wrath of the administration down upon our heads, but we do it nevertheless, as we have no choice. Look upon us, Republicans! If you succeed in repealing Obamacare, just look at what you will inherit! The alternatives you propose to Obamacare all hinge on a robust health insurance industry, but we are not robust – we are decrepit, we are dying. Our business model is so obviously broken that today we are behaving suicidally. We, your presumed partners in your post-Obamacare healthcare system, are the living dead. So think twice, Republicans, before you go any further!”

Just how well the insurance companies will succeed by this method in slowing the Republicans’ efforts to overturn Obamacare, one cannot say. Probably not much. But inasmuch as Obamacare is utterly necessary for the survival of the insurance industry, if this method fails DrRich is confident they will come up with something better.

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This is the third in a series of articles on End-of-Life Care and Covert Rationing.  The first two articles can be found here and here.
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In his previous post, DrRich attempted to satirize the lame attempts of certain payers to “inform” certain of their “covered lives” that, among all the wonderful options available to them under their truly comprehensive health plans, the medical service of physician-assisted suicide would be compassionately offered and cheerfully paid for. DrRich even offered, thoughtfully as usual, some free though invaluable advice to payers on how they ought to go about marketing assisted suicide as a cost-saving strategy, and to do so in a far more sensitive and less ham-fisted way than they have managed so far.

If the mark of good satire is that at least some readers will have difficulty discerning whether the satirist is serious or not, then DrRich is feeling genuinely Jonathan Swiftian today.  For some of his readers (one of whom e-mailed, “I can’t believe what I just read. This is sick.”) have taken his modest proposal for selling assisted suicide at face value.  This is not the first time DrRich has made unfortunate impressions upon readers through his (possibly inept) use of irony. Sadly, it almost certainly will not be the last.

But assisted suicide being such an important and ethically charged topic, DrRich feels obligated to clear things up once and for all. So what follows is DrRich’s honest assessment of the advisability of physician-assisted suicide, in which he will attempt to forgo entirely any satire or irony (though he admits to having great difficulty in controlling his sarcasm).

DrRich believes that physician-assisted suicide is a very, very bad idea.  He has two major reasons for this belief.  On a purely practical realm, embracing and systematizing physician-assisted suicide under any healthcare system that is actively engaged in rationing (whether overtly or covertly) will almost surely lead to some terrible abuses of the practice. In this regard you can either use your imagination, or read the history of Europe in the first half of the 20th century.

His second objection to physician-assisted suicide is based on a consideration of ethics. DrRich admits to being on shaky ground here because: a) he is not formally trained in ethics, and b) it appears for all the world that those who are formally trained in ethics have universally concluded that physician-assisted suicide is perfectly OK in every way.

Debating with modern medical ethicists, at least if you are merely a layperson, is mostly a losing proposition.  This is not because ethicists are intellectually (or even ethically) superior, but rather because they are adept in couching their arguments in arcane twists of logic and webs of jargon that make their arguments difficult if not impossible for the uninitiated to follow.  This technique, of course, places novices like DrRich in the position of having little choice but to accept the ethical bottom line without really understanding how the bottom line was reached. It reduces medical ethicists to a priesthood, and medical ethics to received knowledge.

But DrRich maintains that advancing unintelligible ethical arguments is, well, unethical.

So DrRich will now present his understanding of the chain of logic by which modern ethicists justify physician-assisted suicide – and its close cousin, euthanasia.  (If any of you actual ethicists out there object to this analysis, and can explain where DrRich is wrong in clear language, DrRich will be all ears. Absent the clear language, though, you can pound salt.)

Modern ethicists argue as follows:

Point 1: Our society has already decided that the autonomy of the individual patient is the overriding ethical consideration in making end-of-life decisions. We formalized this determination when we decided – by overwhelming consensus – that an individual has a right to refuse medical treatment even if that treatment is very likely to save their life. Therefore, individual autonomy is the universally agreed-upon controlling ethical precept.

And in adopting this controlling precept, we have already firmly decided that passive euthanasia – allowing nature to take its course by withholding treatment at the request of the patient – is ethical.

Point 2: There is no ethical distinction between passive euthanasia and active euthanasia. That is, whether we let death occur by withholding effective medical care, or by actually doing something to help death along a bit, we’re taking an action that hastens death either way. Ethically, both of these actions are equivalent. So, once we decide that individual autonomy is the overriding concern, we must also allow for active euthanasia when a patient wishes it.

Point 3: Once active euthanasia is deemed ethical, there can be no further ethical objection to the lesser act of physician-assisted suicide.  If it is ethical for a doctor him/herself to bring on the death of a patient who requests it, there can be no objection to doctors preparing the suicide machine and handing the patient the switch.

The striking thing here (to DrRich, at least) is that in establishing the ethical case for physician-assisted suicide, we necessarily also establish – as a veritable pre-condition – the ethical case for physician-provided euthanasia. Whether the patient says, “Help me to take my own life,” or “Take my life for me,” modern medical ethics supports the physician who replies, “Roll up your sleeve.”

For those who don’t see a problem with this, DrRich refers you to the Dutch system, where, in full accordance with modern medical ethics, the rules permit both physician-assisted suicide and active euthanasia for patients who request it. Reports on the results of the Dutch system (reports which both sides have used to bolster their respective opinions on either the glories or the travesties of such a system) do point out one striking finding – hundreds of times each year, acts of *involuntary* euthanasia are occurring. That is, patients are being killed under the Dutch healthcare system at the hands of their doctors, without their explicit permission. All these patients, it is claimed, are being euthanized for entirely humane reasons.

What do our friends the medical ethicists have to say about such involuntary euthanasia? Well, it turns out that it’s OK with many if not most of them. Ethicists don’t like to tell us that their chain of logic doesn’t end with Point 3.  But once we make the principle of individual autonomy the overriding consideration in determining end-of-life ethical issues, the same chain of logic takes us directly to Point 4.

Point 4: Since honoring the ethical precept of individual autonomy makes voluntary euthanasia available for patients with intractable suffering, it would be unethical to withhold the same benefit from suffering patients who are too incapacitated to give their permission. Their incapacity should not restrict them from a good that is available to others, for to do so would be discriminatory and inhumane. To cure this problem, the boon of active euthanasia can and must be performed, even without the patient’s explicit permission, in incapacitated patients whom “reasonable people” would agree are suffering too much. Therefore, involuntary active euthanasia is also ethical.

This conclusion, of course, leaves us in a place where others (i.e., “reasonable people,” like doctors or other agents of the Central Authority) can decide for an individual what constitutes intractable suffering, and further, can decide when such an individual is simply too incompetent to know that euthanasia is the best thing for them. Some of you, of course (hello, ethicists!) think this is just a fine idea. Most apologists for the Dutch system apparently do.

But DrRich maintains that under our system of covert healthcare rationing, where doctors are under extreme pressure to do the bidding of the third party payers (private insurers and the government) who determine their professional viability, and where the payers are under extreme pressure to reduce cost, and have already displayed in numerous ways their willingness to permit suffering and death among their subscribers in order to do so, then opening the door for physician-assisted suicide (let alone physician-administered euthanasia, whether the patient requests it or not), would inevitably lead to some nasty abuses, and would ultimately serve to undermine our civil society. DrRich is too politically correct to use the “other” N-word, but he will take this opportunity to remind his readers that such a thing has already happened, in what recently had been perhaps the world’s most cultured and educated society, within the memory of millions of living people.

DrRich believes that the principle of individual autonomy is vitally important, and indeed it is the foundation of American culture. However, no single ethical principle, no matter how important, can be allowed to overrule all other ethical principles in all other circumstances.  By nature, ethical precepts are often in conflict, creating what is called an ethical dilemma. And (DrRich humbly submits) it is supposed to be the job of ethicists to help us work through those ethical dilemmas, to find the right balance between competing principles, and not simply declare that no dilemma actually exists, because Ethical Precept A is the only one we need to pay attention to.

Individual autonomy is critically important to American culture – and the fact that we must fight to preserve individual autonomy in the face of covert healthcare rationing is indeed the underlying message of this blog – but in no other aspect of our culture do we let it absolutely rule. The autonomy of individuals needs to be checked, and we indeed limit it. This is the fundamental reason that governments are necessary in the first place.

The reason we have laws (supposedly) is to make sure that the behavior of individuals acting in their own interest, especially those who have accrued power (for instance, by accumulating great wealth, by acquiring large weapons, or by becoming heads of state), does not abrogate the natural rights of other individuals. Indeed, most of the political fights we have – between Democrats and Republicans or progressives and conservatives – are to determine where to place those limits, on individuals and on the collective, to best encourage a robust society that honors individual autonomy but that also encourages reasonably equal opportunities for individual fulfillment (i.e., “happiness.”) The main purpose of our public discourse, then, is to find the right balance between the rights and needs of individuals and the rights and needs of society as a whole.

So for ethicists to say, “Individual autonomy is all there is to it, and we have no choice but to follow that principle to wherever it may lead us,” is not only completely irresponsible and dangerous, it also flies in the face of our culture’s history and our everyday experience.  The cost to society not only should but must be taken into account as we consider institutionalizing physician-assisted suicide (let alone voluntary or involuntary euthanasia).  In DrRich’s opinion, ethicists who argue that we need not consider the cost to society in making end-of-life policy have declared themselves unworthy of the title and they ought to be completely ignored.

The cost to our society of institutionalizing and systematizing physician-assisted suicide, especially while we are still covertly rationing healthcare, would be severe and potentially lethal. Within the next decade or two, if things do not change, we likely will be facing cost pressures emanating from our healthcare system that will gravely threaten the survival of our culture. With an existential threat such as this, can we really refrain from slowly transforming the request for assisted suicide from an option to a duty? Can the Central Authority really stay its hand when it has the capability of directing its agents at the bedside to perform euthanasia on unfortunate (and unproductive) citizens who are too “incapacitated” to understand it’s the only thing to do?

DrRich, who opened this post with a promise to avoid irony, apologizes. For when all is said and done, it is deeply ironic that by steadfastly clinging to the ethical precept of individual autonomy at the end of life, within in a paradigm of covert healthcare rationing, we will very likely end up by completely devaluing the inherent worth of individuals.

At least until we solve the fiscal problems within our healthcare system, we simply should not embrace assisted suicide – no matter what we may think of the ethics of the act itself – and we should fight efforts to make it acceptable. The cost to our society would be far too high.

If people want to commit suicide and if medical ethicists insist that assisted suicide is OK, then let the ethicists do the assisting. DrRich has relatively little to say against ethicist-assisted suicide. But, at least as long as covert rationing is the chief operating principle of the American healthcare system, for the love of God keep the doctors out of it.

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“Drown me! Roast me! Skin me alive! Do whatever you please!” cried Br’er Rabbit. “Only please, Br’er Fox, please – whatever you do, just don’t throw me into that briar patch!”
- Joel Chandler Harris

Quite a lot has happened on the healthcare front over the holidays, even in addition to the Telltale Pacemaker story, and DrRich suspects that more than a few of his readers – busily eating, drinking and being merry – may have missed some of it. But fear not. DrRich is committed to catching you all up.

One story even the most dedicated of you revelers might have heard something about is that a U.S. District Judge, Henry E. Hudson, has declared the Obamacare individual mandate to be unconstitutional.

This ruling has no immediate practical result, since the individual mandate is not scheduled to go into effect until 2014. But Hudson’s ruling has given a great boost to Tea Partiers, certain Republicans, constitutional fundamentalists, and other recalcitrants who keep trying to disrupt the modern Progressive program by invoking the Constitution, and other old-timey scripture, written by slave-holding, wig-wearing, pompous old white men who didn’t even like each other very much, let alone Diversity, and who had never even heard of Twitter or Facebook or 4G networks, and whose scribblings therefore cannot possibly have anything important to say to modern-day people like us. In any case, Hudson’s ruling is not dispositive, and the matter of the constitutionality of the individual mandate will finally be decided in the U.S. Supreme Court.

In a related matter, also over the holidays, President Obama phoned the president of the Philadelphia Eagles to praise him for giving Michael Vick a second chance.

Some readers will not immediately see how President Obama’s phone call to the Eagles is relevant to Hudson’s ruling on the individual mandate, but that’s what DrRich is here for. You see, Dear Readers, Mr. Obama is a very brilliant and subtle man, whose actions and words can never be taken at face value, but which (like, as it happens, the actions and words of Christ) must be interpreted in the context of the entirety of his life’s work. Accordingly, his phone call to the Eagles can only be properly interpreted if one understands (as the President undoubtedly does) that Judge Hudson is the selfsame judge who sentenced Mr. Vick to the federal penitentiary for engaging in unsavory sporting activities involving dogs.

It should be clear then that President Obama’s real message, for those few of us who are perceptive enough to understand it, is: “Judge Hudson has a history of making rulings whose ultimate result is the precise opposite of what one might originally think. His Vick ruling was seen by everybody as an action that would ruin Mr. Vick’s career forever. But, as a result of that action, Mr. Vick dedicated himself as never before to becoming a great quarterback, and has already achieved heights he might never have reached if Hudson had been more lenient. So when Hudson says the individual mandate is unconstitutional, take heart! The final effect of his ruling will be – as in the case of Michael Vick – the opposite of what everybody thinks.”

The loud protests you hear from Mr. Obama’s side regarding the challenge to the constitutionality of the individual mandate, for the most part, are genuine. Most Progressives, lacking Obama’s subtlety, are outraged that something as important and as groundbreaking as Obamacare is threatened by mere scratchings made by old men in ancient days on a piece of cracked parchment. The official defense of the individual mandate made shortly after Hudson’s ruling, by none other than Kathleen Sebelius and Eric Holder, stresses this point. These eminences (one of whom is the Attorney General of the United States for goodness sake!) were utterly unable to come up with a legal or constitutional justification for the individual mandate, and based their defense entirely on the proposition that Obamacare is really, really important, and that the individual mandate is vital to Obamacare. The notion that if something is important enough the Constitution must be pushed aside (or, more accurately, “re-interpreted” in light of modern-day exigencies) is a given for Progressives, and they just don’t understand how any reasonable person could think otherwise.

Mr. Obama, DrRich believes, looks at it differently. Let us review some basic facts:

1) President Obama favors, and is working toward, a single-payer healthcare system. He has said so publicly many times. (Here’s one example.)
2) Obamacare places us on the road to a single-payer system – either a direct single-payer system run entirely by the government, or a single-payer system which is administered by minutely-regulated “health insurance utilities.”
3) The health insurance industry is currently running out the string on its fundamentally broken business model, and desperately needs Obamacare as a pathway to a graceful exit strategy.
4) The sole reason for the individual mandate was to get the health insurance companies on board with Obamacare, that is, the individual mandate buys the insurance industry a few more years of life – one last windfall – in return for which they will become heavily regulated utilities,  and likely avoid the ignominious and catastrophic failure their current trajectory suggests.
5) On the other hand, if we instead went to single-payer healthcare like the President and his Progressive friends want – such as Medicare for all – then the constitutionality of the individual mandate would immediately become moot.

If these facts – particularly the ones about the state of the health insurance industry – are correct (and DrRich believes he has amply demonstrated that they are), then declaring the individual mandate to be unconstitutional will actually play into Mr. Obama’s hands quite nicely.

If the individual mandate is declared unconstitutional and Obamacare becomes entirely defunct, the insurance industry will remain on their path to imminent disaster. They will be forced to price nearly everyone out of the insurance market, and themselves out of business, and we Americans will be left with no obvious choice but single-payer, Medicare-for-all healthcare by default, as the only obvious constitutional option. (There are, of course, other options – such as the one DrRich has proposed – but these likely will continue to be ignored.)

Mr. Obama will go on TV and say:

“We tried! Nobody can say we didn’t. We presented our nation with a healthcare plan that would cover almost everybody, and which would save the private insurance industry. But now, the actions of the Republican naysayers have destroyed the only mechanism that would have allowed the insurance industry to continue to function.  And now the insurance companies are falling like dominoes, and uninsured Americans will soon number over 100 million.  You and your loved ones and your neighbors face imminent death or disability from Republican neglect.  We must act, and we must act now.

“I and my Democratic colleagues did not want it this way. We fought hard for our centrist, market-based plan.  But our Republican opponents and their allies in the reactionary Court leave us no choice.  My fellow Americans, as a matter of national security, and of national survival, we must pass into law, within the next 30 days, my new program to expand Medicare to cover all Americans. All other paths have been closed to us. And if you don’t like it, as I myself do not, you know who to hold responsible at the polls.”

On the other hand, of course, the individual mandate may be declared constitutional by the Supreme Court. (DrRich does not understand how this could happen under the Constitution as written, and neither, apparently, does Mr. Holder. But given the “living document” proclivities of many justices these days, one must admit it is reasonably likely to happen.) And if the individual mandate is declared constitutional, then the federal government will have been granted the authority to dictate any behavior it wishes upon individual Americans, as long as those behaviors are deemed to be important enough by the government to the collective interest.

Either outcome to the constitutional challenge to the individual mandate, therefore, will be more than convenient to the ends of President Obama. He understands this very well as he stands there, entirely serene and above the fray, watching Sebelius and Holder, and his other minions, caterwauling over the constitutional challenge to the individual mandate.

“Please, Br’er Elephant,  whatever you do, please don’t throw my individual mandate into that briar patch!”

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One of DrRich’s most dearly held theories, which he has expounded upon at length, is that the American health insurance industry supported Obamacare from the very beginning (and continues to do so) because the President’s plan offers them a graceful exit strategy from their now-defunct business model. Without Obamacare, the health insurance industry was headed toward sure oblivion. With Obamacare, they are headed toward – something else.

The remarkable and sustained actions the insurance industry took in support of Obamacare, DrRich continues to submit, is all the evidence that one should need to conclude that a deal has been struck. But even DrRich has had to admit that it has never been entirely clear what, exactly, the deal was. What were the health insurance companies promised in exchange for their support?

One obvious benefit for the insurance industry is the one last windfall they will enjoy when the individual mandate kicks in, and a few tens of millions of mostly-healthy Americans are coerced into purchasing health insurance for the first time. This windfall should not only temporarily boost the insurers’ bottom lines and their stock prices, but will likely push out for a few years the timing of the industry’s ultimate demise. So that part of the “deal” is pretty clear.

The remaining question is what will happen when that “last windfall” runs its course. Here, DrRich has speculated on two possible outcomes. Perhaps the health insurance industry will declare, at the appropriate moment (after profits have been made, stock options exercised, golden parachutes deployed, &c.), that they just can’t make a go of it anymore. This, obviously, will leave the government (whether it is controlled at that particular moment by Democrats or Republicans) with no choice but to step in and take over, lock, stock and barrel. DrRich has called this single-payer end-game the Amtrak Model.

On the other hand, the end-game could follow the Public Utilities Model. Here, the health insurance companies will be converted, either all at once or gradually, into public utilities. Public utilities operate as private companies, but the rates they can charge, the profits they can make, and the products they can offer, are all determined by the government. Such an outcome would be only a quasi-single-payer healthcare system, and so might be easier to justify to a Tea-Partied-up American public.

Either option would provide a graceful exit strategy to our health insurance industry, and either would be far more attractive to them than the ignominious oblivion they would have faced without Obamacare.

Last week, we were informed that what Obamacare has in mind for the insurance industry is the Public Utilities Model. That evidence came in the form of the Medical Loss Ratio (MLR) rule that was formally issued by the HHS, in accordance with a provision of Obamacare.

Under Section 10101 of the Affordable Care Act (Obamacare), beginning in January, 2011, insurers are required report to HHS each year what percentage of their revenues from premiums they spend on a) clinical services for enrollees, b) “activities that improve health care quality,” and c) all other costs. Depending on the size of the group market (and a few other factors), insurers must spend either 80% or 85% of premiums revenue on actual health care. (This amount, in health insurance parlance, is called the “medical loss.”) So only 15% or 20% can be spent on administrative costs, marketing, profit, and other non-clinical expenditures.

Behind the scenes, there was a great amount of jockeying over the past six months to convince the National Association of Insurance Commissioners (NAIC, the organization designated to propose the MLR rule to HHS) as to what constituted clinical and quality-improvement activities and which did not.

The health insurance industry tends to insist that every activity it undertakes is aimed at improving healthcare quality, whereas congresspersons and policymakers and consumer advocates insist that very little of what health insurers do has anything to do with anything except profit and greed. So, for instance, insurers claimed that the “healthcare hotlines” they have set up for subscribers are a quality measure, and should be included under medical loss; whereas opponents of the insurance industry claim it is purely an administrative function.

(DrRich does not know whether opponents remembered to advise the NAIC how certain insurers have utilized such hotlines in the past. For instance, in 2002 Kaiser Permanente paid workers at three northern California call centers bonuses for limiting the number of doctors appointments they set up, and for limiting the duration of patients’ phone calls. Kaiser admitted that workers at the hotlines received between 2 and 4% of their salaries as bonuses if certain criteria were met. In order to receive their bonuses, the hotline workers were expected to make appointments for less than 35% of the callers, to spend an average of less than 3 minutes and 45 seconds per call, and to escalate less than 50% of their calls for further evaluation.)

In any case, the NAIC finally made its recommendation on the MLR rule, and on November 22 HHS accepted the proposed rule in its entirety.

For the purposes of this post, the details of the new MLR rule are not particularly relevant. What is relevant is that such a rule was made at all.

The MLR rule sets a federally mandated, one-size-fits all limit on how much of its revenue an insurance company can use for administration and profit. That is, the MLR rule is explicitly the very kind of control that government agencies always impose on public utilities.

For public consumption, proponents of Obamacare have always claimed that insurance expenses – including profits – will be controlled through the competition that will be provided by the new “health insurance exchanges.” If market-like competition were actually simulated through these exchanges, then it is true that the MLR ratio would be driven toward the optimal value.

But the MLR rule establishes, among other things, that market forces are actually not going to be allowed to function in this arena. Rather, the optimal value for MLR will be determined by governmental regulators.

And so, dear readers, it appears that the deal, which proponents of Obamacare struck with the health insurance industry, is beginning to take definite shape. What we’ve got here, increasingly clearly, is the Public Utilities Model – a truly graceful exit strategy by anybody’s reckoning.

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Regular readers will know that DrRich is not enamored with Obamacare. Further, they will recall that DrRich’s chief objection to Obamacare is that it codifies into law the final destruction of the classic doctor-patient relationship.

Under Obamacare, the physician is not only released from her fiduciary obligation to her individual patient (i.e., the obligation to place the interests of the patient above all other considerations), but is strictly forbidden from acting in accordance with it. Indeed, elaborate mechanisms are established to assure that physicians will follow the directives which are to be handed down from omnipotent and immutable government panels, directives which will be explicitly aimed at optimizing collective rather than individual outcomes. And whereas physicians have long been discouraged from making healthcare decisions based on individual considerations and needs, Obamacare makes doing so a felony.

Combine that fact with inevitable future provisions that will prevent doctors from opting out of the system, and patients from spending their own money on their own healthcare, and you’ve got a prescription for a healthcare system (and a society) that are somewhat less friendly to individual needs, and somewhat more tyrannical, than supporters of Obamacare have promised us.

So, as a matter of principle, DrRich is sympathetic toward the newly-elected (and newly-reformed) Republicans who promise they will introduce and vote on a bill to repeal Obamacare.

But let’s be realistic. Even the most zealous Republicans understand that any repeal bill that passes in the House will stall in the Senate, and if it does not, the President will veto it. Indeed, it is this comforting assurance, DrRich thinks, that will induce many Progressively-oriented Republicans to go along with a repeal vote in the first place. By voting to repeal Obamacare, frightened and disoriented Republicans can mollify the Tea Party, without risking an actual abolition of the new reforms. Because if Obamacare were somehow repealed – well, where would the Republicans be then?

The health insurance industry, however, is taking no chances.

DrRich will remind his readers that Obamacare never would have become law in the first place if not for the solid and unrelenting support of the health insurance industry. The industry’s support for Mr. Obama’s effort was unfaltering. And during the long and perilous process that finally brought Obamacare to the President’s desk, whenever the cause faltered and appeared to be lost, representatives of the insurance industry would rise up and take whatever strong and difficult action was needed to get it back on track.

DrRich will further remind his readers that the insurance industry did not support Obamacare out of any principle, or compassion, or any sense of what was moral or right. They did it as a matter of life and death – theirs. For the health insurance industry had run out its string, shot its wad, blown up its business plan, and had nowhere else to turn. It was Obamacare – and its soothing “promise” to allow the industry to survive in diminished form, as a government-controlled utility – that offered insurers their only visible path away from oblivion.

The insurance industry is not about to go back. Furthermore, unlike Nancy Pelosi, Harry Reid and even President Obama, the insurance industry is not satisfied to let the political realities of the day block the Republicans’ efforts at repeal. For all they know, nervous Democrats in the Senate who want to be re-elected in 2012 will allow the repeal bill to go to the President’s desk. Worse, unused to seeing Presidents willing to sacrifice themselves on the alter of principle, the health insurers, in their existential panic, must wonder whether even Obama might finally change his mind and decide that he wants to be re-elected badly enough to sign a repeal bill. These possibilities seem pretty far-fetched to DrRich, of course, but to DrRich the prospect of repeal does not spell Armageddon.

During the long and painful process that saw Obamacare become law, the health insurers clearly demonstrated just how far they were willing to go to keep that process alive. DrRich is certain they will be happy to go at least that far to block repeal.

So it came as no surprise when, just last week, the insurers sent Republicans their first, gentle reminders that they will not countenance any such thing. At the Reuter’s Health Summit in New York, David Cordani, the CEO of Cigna, warned Republicans, “I don’t think it’s in our society’s best interest to expend energy in repealing the law. Our country expended over a year of sweat equity around the formation of it.” And Mark Bertolini, president of Aetna, said that any attempt to repeal Obamacare, or even an attempt to hold up funding for it, would be “problematic.” “We can’t go back,” said Bertolini,  “We need to keep moving, and we need to improve upon what we have.”

These seemingly mild-mannered statements should send a chill up the spines of Congressional Republicans. Any repeal of Obamacare necessarily and utterly relies on the acquiescence of the insurers, on their desire (or at least willingness) to continue with their current business model (possibly with some tinkering around the edges). Republicans, bless their innocent hearts, assume that’s what the insurers want.

But the truth is that the insurers know that their current business model is completely defunct, and far beyond any salvation. They see Obamacare as their only visible lifeline, and any serious threat to Obamacare as a threat to their survival.

The health insurers simply will not countenance a repeal of Obamacare. They will do whatever is necessary to demonstrate this fact to the Republicans. Their initial foray is suitably gentle. But once the repeal effort gets revved up, watch out. The insurers have already graphically demonstrated just how ungentle they can be.

If the Republicans really want to get rid of Obamacare, they’re going to have to propose an alternate solution that, among other things, provides the health insurance industry with a new and viable business model, one that seems at least as good to them as the rather paltry one Obamacare has promised. (If the Republicans want such an alternate solution, they have only to ask DrRich.)

DrRich does not think the Republicans have any idea of what may be coming their way, and from the very industry, no less, they consider to be their chief ally in the healthcare wars.

They should pay more attention.

Podcast:

DrRich is amazed at all the attention being paid to the impending mid-term election.

Breathless commentators speculate endlessly whether Republicans will take over the House and Senate, or just the House; and small-time operatives who in the heat of battle blurt out words like “whore,” or “bitch” (it truly is the Year of the Woman!), or inflammatory phrases like “punishing our enemies,” are subjected to endless public psychoanalysis. The angst is palpable.

For those of us interested in healthcare reform the coming election is an interesting sideshow, but it will not substantially change the cascade of events that has been set in motion by a) history, b) the election of Mr. Obama and his dogged persistence in passing his healthcare legislation by whatever means necessary, and c) the implications of the election of New Jersey Governor Christie a year ago.

As DrRich has said to his readers countless times, the real meaning of Obamacare is that the job of covertly rationing America’s healthcare is being formally transferred from the insurance companies (which have had quite enough, and which did everything they could to see that Obamacare became law), to the government. That transfer of the responsibility for covert rationing to the government is merely the natural culmination of 50 years of history. And the fortuitous election of Mr. Obama is merely the particular event (like the dropping of a crystal into a supersaturated solution) that finally brought a historical inevitability to fruition.

But the election of Governor Christie – now that was a real Wild Card. Christie’s election revealed (to DrRich, at least) that the government’s takeover of covert rationing (which, obviously, requires a government takeover of healthcare) may not be the end of the story.

At this point, some of DrRich’s readers undoubtedly think he is referring to Christie’s conservative economic outlook; his willingness to take on public employees, teachers, and others whose unions, over the years, coerced and/or bribed corrupt politicians into awarding them unsustainable entitlements that are incompatible with a stable society. They think DrRich is referring to the fact that, if even the people of very-blue New Jersey are willing to elect such a conservative Republican, then the Progressive agenda (and hence Obamacare) must actually be in real trouble.

While there may indeed be something to this argument, it’s not at all what DrRich is referring to.

Rather, DrRich is referring to the fact that the voters of New Jersey, at a time when Mr. Obama’s popularity was still quite high, chose to violate a pattern they had established over the manifold generations, chose to knock the stars out of alignment, chose not to return to office Mr. Corzine, the incumbent Democrat in a strongly Democratic state, who was strongly supported by President Obama himself, and instead chose to break with all of history, with all tradition, with their primeval instinct, and with their common sense, and elect instead – a fat guy.

Electing a fat man, DrRich must point out, was not incidental. Corzine cagily made it a campaign issue by running campaign ads reminding New Jersey voters that Mr. Christie was obese, and that he was not. Mr. Christie himself was driven by this tactic into a public admission that he indeed was quite overweight (and offered the lame suggestion that his obesity was irrelevant to the job he was seeking).

Any voter pulling the lever was necessarily thinking, “fat guy, or skinny guy?” And they, with malice aforethought, picked the fat one.

This was absolutely stunning. The implications are too far-reaching to exaggerate.

For a long time now – but especially since the beginning of the Obama Presidency – a concerted and sophisticated campaign to begin “culling out” the obese has taken place. This campaign has been conducted with great energy by everyone who matters – the government, academia, various covertly-funded consumer groups, and numerous industries and enterprises whose success depends on lots of fat people becoming desperate to lose weight. We have been assured that the obese are fat by choice, and that as a result, by their own volition they have allowed themselves to become a threat to humanity (by, among other things, increasing global warming), and most especially, a threat to the fiscal stability of our healthcare system and therefore our nation.

The message is clear: If we don’t get the obesity epidemic under control we are lost as a people. (Historians may find it interesting to note that this epidemic was greatly accelerated in 1998, when the NIH changed the definitions of “overweight” and “obese” from a BMI of 28 and 32, respectively, to a BMI of 25 and 30. The very next morning, tens of millions of previously healthy Americans woke up to find themselves fat. Even more than most epidemics, this one developed with the speed of a tsunami.)

Obamacare – which places the control of the healthcare system into the beneficent hands of our political leaders – finally provides the tools to eliminate this scourge. It will take some tough love. But for the good of America (and, who knows? possibly for the good of the obese themselves) we’ve got to do it.

Central to our efforts to save our country is the conviction that the obese are different, and while they may be potentially salvageable as worthy humans, in their present state (posing as they do such an existential threat to the rest of us), they need to be (at the very least) ostracized.

Perhaps the most telling example of just how far we had come in this regard occurred in July, 2009, when President Obama named Dr. Regina Benjamin as Surgeon General. When it appeared from certain pictures and television images that Dr. Benjamin may be somewhat overweight, critics pounced immediately. How can one become the epaulet-wearing Head Doctor of All America, in the middle of a life-threatening obesity epidemic no less, and be fat? No fat person should ever rise to any position of prominence (where he or she could potentially become a role model for young Americans) – much less this particular position.

It must have brought a tear of joy to the anti-obesity crowd to learn that being obese now so demonstrably trumped being: a) an African American, b) a woman, c) a hero who dedicated herself to providing medical care to the Katrina-ravaged poor, and d) strongly supported by President Obama himself.

But all this progress (and all this hope) was dashed just a few months later by the voters of New Jersey, when they chose to elect a fatty.

When an obese Republican can be elevated to such a position of prominence and responsibility, and by a Democratic electorate to boot, the anti-obesity campaign has been set back by decades. That a rotund candidate could emerge victorious despite such an onslaught – and not, as the breathless conjectures of our professional punditry suggest, a Republican resurgence – is the real threat to healthcare reform.

A government-run healthcare system permits – nay, demands! – that we declare to the obese that their unsightly physiques are no longer a matter of personal choice, but are now a matter of legitimate public concern. The choices they are making – that is, their gluttony, sloth and all other manner of self-indulgence – are placing unwanted and unsustainable demands on us purer, svelter, fellow-citizens.

More importantly, ostracizing the obese sets an important precedent for our wise leaders to restrict, control and tax virtually any human behavior they can claim may lead to an increased risk of healthcare expenditures – which, really, encompasses virtually any human behavior you can think of. Furthermore, successfully dehumanizing the obese will establish that our society may, whenever it needs to, discriminate against the lower economic classes (since these classes are well known to indulge in becoming overweight). And finally, since obesity (despite our decision to blame it on personal failings) is largely determined by genetic predisposition, our success in dehumanizing the obese will give us a useful tool which we can later employ to withhold healthcare expenditures for other genetically-mediated medical conditions.

It is clear that successfully demonizing the obese is a vital pillar of Obamacare.

Now perhaps, Dear Reader, you can see why the election of Christie in New Jersey was such a potential catastrophe. It is his obesity, rather than his Republicanism, that poses such a threat to healthcare reform and thus to the Obama administration.

It was the result of the New Jersey election a year ago, and not the results of the impending mid-term election (which will merely add an exclamation point to New Jersey’s declarative statement) that changed the landscape. Clearly, the anti-obesity movement, despite concentrated, coordinated and sustained efforts to make overweight Americans feel subhuman, has failed. The election of Christie – wherein the electorate of a Democratic state has raised up to prominence a fat guy, despite the damage that does to the long-term prospects of Obamacare – was the real blow.

For if We the People (even that part of “We” who are Democrats) refuse to follow the dictates of the Central Authority as it attempts to educate us on Right Thinking, then the passage of Obamacare cannot actually represent the culmination of Progressive history. It means that the final chapter has not yet been written, and real hope remains for those of us who do not buy into the Progressive program.

And this is true whatever the results of Tuesday’s election. Thank you, New Jersey.