Re: state budgets, AFIK all 50 of the states by law must have balanced budgets. Something about them not being allowed to file bankruptcy. Because of that they are a different animal than the federal budget.

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I see, and the Union medical plan was Medicare?? Or was it with a *private* insurance company?

I see that we need massive cuts in health care costs. I readily agree to that. Costs *per person* in Medicare have risen more slowly than costs per person in other insurance plans. This is masked by the large increase in those covered as we age.

What I'm suggesting is a lack of faith in private insurance as the cost cutting agent.

Just where did the other money go? It went to the Union medical plan.

Do you begin to understand why massive cuts are needed in medicare?

States can balance budgets by a number of manipulations -- including bond bills and selling off assets and then renting them back (Arizona has done that). States can also balance budgets by underfunding state health insurance and pension plans. Most states have done that with their pension plans.

Re: state budgets, AFIK all 50 of the states by law must have balanced budgets. Something about them not being allowed to file bankruptcy. Because of that they are a different animal than the federal budget.

Guy, in terms of reforms of the entitlements -- I don't disagree with the need to do that. Nor do I disagree much with your relatively dismal assessment regarding political will of either the electorate or the elected officials to come to grips with this.

It seems of the potentially electable candidates in the TeaParty (that being reduced to two from what I can see), both of their proposed budgets are even worse (in terms of deficits) than the incumbent. It seems for all the chatter that the TeaPublicans have generated about deficits, they are even less able to 'square the circle' than their opponents. I find that quite telling.

Is it as bad or as soon as you believe? I don't quite see that -- though the big variable there is the rest of the economy. If we manage (somehow) to sustain economic growth over the next few years, not only will that increase revenues significantly, but it will reduce expenditures as well. Also, if the lack of political will to 'do something' results in the Bush tax cuts going away (totally) and the sequestration bill to take effect, that too will will slow down the march to insolvency.

But none of that entails doing the heavy lifting of entitlement reform (the last time that really happened was under Clinton), nor tax code reform (which is way long overdue).

So Chris, ah, you are talking the UK -- fair enough. Though Blair was more of a centrist than 'looney left' -- that's why he was able to stay in power as long as he did.

One thing it seems that much of Europe *may* be waking up to, if you push heavy on the austerity brake, you might well be pushing on the national (or European) economy brake into recession, which really can mess up budget balancing. Perhaps it is a case of 'the operation is a success but the patient died' here and needs a rather more deft touch to get to a desired result.

Chris, one of the other issues with the Greek (and for that matter, the Portuguese, Spanish, and to a lesser degree Italian economies and social policy set is that they really don't fit into the German/Luxemborg/Dutch/Belgium/French model particularly well. The Eurozone has turned out to be a bad fit for those economies for a number of reasons.

Had they not been part of the Euro, they would not have gotten near as much easy money as they did for deficit spending -- and, when push came to shove, their native currencies would have been adjusted to reflect this.

The loans and expansion of debt to Greece, Spain, Portugal, and to a lesser degree Italy would have parallels to the loans and expansion of debt in the US housing market.

Like the US, the folks who, in the end run that will suffer most are NOT the wealthiest, but rather the middle and working class. (and it seems that the UK budget reductions might have the same target).

The parallel continues in the US, where the seeming biggest numbers of debt reduction are available by targeting the larger segments of the population -- at least some of whom can ill-afford it. I don't know that there is a better way or a way to 'reduce the pain' -- but it might be a good approach to share that pain 'upward' in the financial universe.

Chris -- you are quite right about the threading here --- perhaps we'd be best starting a different topic for this.

Factoid alert:


"In 2009, Americans spent $7,960 per person on health care. Our neighbors in Canada spent $4,808. The Germans spent $4,218. The French, $3,978. If we had the per person costs of any of those countries, America’s deficits would vanish. Workers would have much more money in their pockets. Our economy would grow more quickly, as our exports would be more competitive."

Note, that is not all on Medicare or Medicaid -- that is a general indictment on the cost of health care in the US.

Factoid alert:


"In 2009, Americans spent $7,960 per person on health care. Our neighbors in Canada spent $4,808. The Germans spent $4,218. The French, $3,978. If we had the per person costs of any of those countries, America’s deficits would vanish. Workers would have much more money in their pockets. Our economy would grow more quickly, as our exports would be more competitive."

Note, that is not all on Medicare or Medicaid -- that is a general indictment on the cost of health care in the US.

Let me refer everyone to the way the Federal Government does business.
http://setiathome.berkeley.edu/forum_thread.php?id=67139&nowrap=true#1201973

The Pentagon is paying 618 percent more for its spare parts than it
should, according to the inspector general’s report, titled “Commercial
Spare Parts Purchased on a Corporate Contract.” It cited a $24.72 spare
part that the government bought from Boeing for $403.39 — a markup of
1,532 percent. Another contractor charged $76 for 57-cent screws.

618% overcharge. Well of you are a doctor or a lab and you can get it from one client using a billing code, why not try and get it from another under the same code? "The government paid it!" Engage brain. The reason medicine is so expensive in the USA is because the government just prints more money to cover medicare.

The proof is here: http://www.npr.org/2012/02/29/147616536/texas-doctor-indicted-in-record-medicare-fraud-case

Anyone who looked at the billings could see plain as day that it was impossible to do this much work. Why isn't this sanity check being done?

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Gary -- sort of non-responsive there. In terms of what folks get paid for providing medicare services -- more often than not, the pay is *less* than from insurance *and* the overhead is lower.

Then again, perhaps we need to reduce Congressional salaries by 80% until the budget is balanced...

Gary, perhaps you are focusing on Medicare fraud there. Fair enough, after all, there is no fraud in the private sector. By the way, there is a derivative I'd like to sell you.

Point being that the amount of fraud in Medicare is likely about the same as in the private insurance side of things -- perhaps a bit more, perhaps a bit less.

Focusing on the classic FWB (Fraud, Waste, Abuse) triangle -- that's like believing that Romney can balance a budget by reducing taxes by 20% and attacking fraud waste and abuse to square the circle. Hmm, sounds like he is an advocate for legalizing drugs there....

It's not just the fraud. It's the waste, overcharging, lack of adequate drug testing, incompetence, ignorance, inefficiency and the long chain from payer to provider.

I estimate a factor of 6 to ten times as much as it should cost in overall healthcare. A bonanza right now for the opportunists--a real mess.

You are of course talking about the health care system in general here, and not simply the Medicare/Medicaid/VA system, right?

This is pretty much a do the math sort of question.

Then again, if this a 'government' thing, I imagine that cutting the defense budget to 1/6 the current number should leave us with an effective and efficient force.

It's not just the fraud. It's the waste, overcharging, lack of adequate drug testing, incompetence, ignorance, inefficiency and the long chain from payer to provider.

I estimate a factor of 6 to ten times as much as it should cost in overall healthcare. A bonanza right now for the opportunists--a real mess.

Gary -- sort of non-responsive there. In terms of what folks get paid for providing medicare services -- more often than not, the pay is *less* than from insurance *and* the overhead is lower.

Then again, perhaps we need to reduce Congressional salaries by 80% until the budget is balanced...

Private insurance pays less? Failure to Give the Government the Best Price Violates the False Claims Act.

While I'm sure there are a lot of cases where that doesn't happen, and every one of those cases is a fraud against the government, many see and understand that the government price is the best discount price. So the Medicare assigned claims price is the cheapest price, everyone else pays that or more if the transaction is on the books and the provider understands the law.

It is the government rules of the game that drive prices ever higher.

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Yes indeed -- depending on the medical insurance company, the compensation for a 90807 (that's a 45-50 minute session) pays anywhere from $80 to $150. Medicare pays under $105 - or rather allows that, Medicare pays a portion of the allowed amount. That's fact sir. It is even worse for a 90806 (25 to 30 minute session).

Perhaps you didn't realize that there is enormous variation in the private insurance industry -- even within a single insurance company.

Perhaps also you didn't realize that Medicare and private insurance set the rates they pay physicians, not the other way around.

Oh, and that doesn't even consider the 'in network' out of network compensations.

Perhaps the rate setting rules are different in the case of health care. They certainly are for psychiatrists.

By the way, with changes in health care law, the *theory* is that psychiatric care is no longer discriminated against in terms of compensation (used to be that Medicare would pay 1/2 of the allowed amount (Medigap insurance can pick up the balance). Now it is gradually moving toward the same ratio as other physicians. Also in health care law -- insurance companies are also supposed to treat psychiatry on a par with other medical care. That's the theory.....

Some psychiatrists simply don't take insurance (or Medicare) - they require private pay only. I suppose that might be considered a form of rationing....

Private insurance pays less?

Yes indeed -- depending on the medical insurance company, the compensation for a 90807 (that's a 45-50 minute session) pays anywhere from $80 to $150. Medicare pays under $105 - or rather allows that, Medicare pays a portion of the allowed amount. That's fact sir. It is even worse for a 90806 (25 to 30 minute session).

Private insurance pays less?

Wrong question. Should be, The Doctor accepts less?

If the Doctor does accept less from a private client, then the doctor is committing a fraud against the government as they are not giving the government their best price.

As to those set rates, the government takes the average of the billed rates, in an area, and uses that for the allowed amount. So all Docs have an incentive to boost their rates.

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I see, so the doctors in the US should all be suing the insurance companies to bring them into sync with Medicare. That will surely strip cost out of the medicare system.

Actually, it seems you are suggesting a well established approach of blaming the little guy for what is done to them by the big guys. Sort of a Romney approach.

By the way, if Medicare, Medicaid, and the VA have different rates, who sues?