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February 2017

The ObamaCare Cleanup Begins Early executive action can improve short-term insurance markets.

All of a sudden the press is filled with stories about Republicans supposedly retreating from their promise to repeal and replace ObamaCare. Liberals are claiming vindication and conservatives are getting nervous, but the stampede to declare failure is premature. The orderly transition to a more stable and affordable health-care system is merely beginning.

As with much else in the Donald Trump era, people should avoid rushing to conclusions. Too much significance is attributed to Republicans adding the word “repair” to their vocabulary, as if this represents a policy change. The insurance markets really do need repair, and doing nothing isn’t realistic amid ObamaCare’s downward spiral.

Likewise, the GOP retreat in Philadelphia last month was contentious, according to leaked audio, but debating the merits of different ideas is how political parties form a strategy. Republicans now recognize that they can’t blame President Obama for insurance disruptions, even if his Administration caused them. They also increasingly understand that they’ve been handed an armed bomb and need to be careful and serious when defusing it.

The exchanges are ailing and fragile—beset by high and rising premiums and a wave of insurer exits. The Health and Human Services Department announced Friday that final enrollment on the federal exchanges for 2017 dropped by about 400,000 from last year. “In spite of the best intentions of Washington and the industry, the intended goals of the ACA have not been achieved. Millions of Americans remain uninsured, and still lack access to affordable health care,” Aetna CEO Mark Bertolini said on an investor call, expressing the business consensus.

Uncertainty is inevitably priced into premiums, and benefits and rates for 2018 started to be designed and set months ago. They’ll be approved by regulators in the spring, so Mr. Trump’s HHS nominees, Tom Price and Seema Verma, need to move fast to bring more predictability to the markets.

One of the President’s first acts was to sign an executive order to “waive, defer, grant exemptions from, or delay” rules that burden individuals, states and business in order to “create a more free and open health-care market.” The specifics are waiting in an HHS proposed rule about “market stabilization” now under review by the White House budget office.

This rule likely includes short-term measures to deregulate ObamaCare’s most onerous provisions. Technical reforms could be immediately reflected in lower premiums. These include relaxing the essential benefits mandate or the price controls that limit how much rates can vary from person to person. The Obama HHS turned the individual mandate into swiss cheese, creating “special enrollment periods” that allow people to dip in and out of insurance at will. Ensuring continuous coverage may be a priority.

Another useful interim change to reduce gaming would be to shorten the ObamaCare “grace period,” a 90-day window that requires insurers to cover consumers who aren’t paying their premiums. A McKinsey study found one of five exchange enrollees stop paying at some point during the year, and half of them re-enrolled in the same plan the next year, availing themselves of three months of “free” coverage.

Congress could also help stabilize the exchanges by suspending the 10-year $145 billion tax on the insurance industry. The costs will be passed on to consumers in higher rates, which is why Congress and the Obama White House agreed to a one-year suspension for 2017. Oliver Wyman estimates that another delay would offer immediate premium relief of 3% for 2018. This would buy some goodwill amid debates about who owes who what in various ObamaCare reimbursement programs.

It’s Britain, So the Anti-Semitism Is More Refined Cutting and pasting the old prejudice of Jews as infanticidal global masterminds onto Israel. Brendan O’Neill ( Aug. 15, 2014)

While browsing this morning I came across this pithy column from Brendan O’Neill still so relevant today….rsk

Britain’s leftists are patting themselves on the back for having resisted the lure of anti-Semitism. Sure, there were some ugly incidents in the U.K. during the Gaza conflict in recent weeks, including the smashing of a Belfast synagogue’s window and the pasting of a sign saying “Child Murderers” on a synagogue in Surrey. But for the most part, Britain’s anti-Israel protesters trill, we avoided the orgies of Jew-hate that stained protests about Gaza in Paris, Berlin and other European cities.

I don’t buy that Britain is an oasis of prejudice-free anti-Zionism in a European desert of anti-Semitic sentiment. Rather, Brits have simply proven themselves more adept than their Continental counterparts at dolling up their prejudices as political stands. In Britain, the meshing of anti-Semitism and anti-Zionism, the expression of ancient prejudices in the seemingly legitimate guise of opposing Israel, is more accomplished than it is in other European countries. Britain isn’t free of anti-Semitism—we’re just better than our cousins on the Continent at expressing that poisonous outlook in a more coded, clever way.

What has been most striking about the British response to the Gaza conflict is the extent to which all the things that were once said about Jews are now said about Israel. Everywhere, from the spittle-flecked newspaper commentary to angry street protests, the old view of Jews as infanticidal masterminds of global affairs has been cut-and-pasted onto Israel.

Consider the constant branding of Israelis as “child murderers.” The belief that Israel takes perverse pleasure in killing children is widespread. It was seen in the big London demonstrations where protesters waved placards featuring caricatured Israeli politicians saying “I love killing women and children.” It could be heard in claims by the U.K.-based group Save the Children that Israel launched a “war on children.” It was most explicitly expressed in the Independent newspaper last week when a columnist described Israel as a “child murdering community” and wondered how long it would be before Israeli politicians hold a “Child Murderer Pride” festival.

Fading U.S. Influence In Asia By Herbert London President, London Center for Policy Research

If one requires any evidence that the United States is a fading power, the recent events in the South China Sea offer ample evidence. Two Chinese fighter jets intercepted U.S. military reconnaissance aircraft and, to add to the humiliation rebuked the Obama administration for any surveillance near China. The incident took place in international airspace on what has been described as a “routine U.S. patrol.” This latest encounter comes on the heels of another interception in which Chinese jets mimicked an all-out attack on a U.S. naval vessel that sailed close to a disputed reef. These are merely two recent war like actions by the Chinese in a series of interception since 2014.

China now claims most of the South China Sea through which $5 trillion in ship-borne trade passes each year. The Philippines, Vietnam, Japan, Malaysia, Taiwan and Brunei all have claims of one kind or another in the Chinese created perimeter and all of these nations depend on the U.S. to enforce those claims. Washington has accused Beijing of militarizing the region, but China responds with a shrug suggesting that there are diplomatic channels available for the resolution of disputes.

The weakness of U.S. naval forces in the Pacific and the China Sea is apparent. New naval vessels – desperately needed to relieve the demands on the existing force – are not in production and with sequestration, are not likely to be in production. There are an insufficient number of Aegis equipped ships to provide an acceptable level of sea-based protection. And after several incidents in which there hasn’t been a military response, Chinese officials believe the U.S. has acquiesced in their regional domination.

Moreover, and quite tellingly, the nations that have claims on islands in the South China Sea, have either dropped their protests or softened their language. There is the growing realization the U.S. is not prepared to protect island claims or even protect freedom of the seas.

The president elect of the Philippines, Rodrigo Duterte, explained, “America would never die for us. If America cared, if would have sent its aircraft carriers and missile frigates the moment China started reclaiming land in contested territory, but no such thing happened… America is afraid to go to war. We’re better off making friends with China.” This is a sentiment resonating throughout the continent.

Chinese sorties against the U.S. are not a casus belli, even as they have increased regional tension and have exposed the U.S. as an ill-prepared protector of Asian allies. Having eviscerated national naval strength, there isn’t much the U.S. can do except express our dismay at the U.N. and in bilateral talks.

The Chinese installation of DF-21 “carrier killer” surface to ship missile, and its current iteration, has a range of 2500 miles. Of significant concern is the Russian air defense, the S-500 anti-aircraft and anti-missile systems that are likely to neutralize the effectiveness of the F-35 stealth fighter before it becomes operational, which the Chinese claim to have acquired. These technical breakthroughs give the U.S. Navy pause; while not dispositive they are factors that militate against activism.