Taking Note

Health Care for Immigrants—When Insured, They Help All of Us

The road to health care reform is peppered with landmines that threaten to derail passage of truly comprehensive legislation. Some of these landmines are predictable: cost projections that go beyond $1.6 billion; controversy over new taxes and a public plan; worries about rationing and a government-takeover of health insurance.

There are other, less obvious, issues that conservatives can use to ignite controversy. Abortion, which I’ve written about here, is one divisive issue that could delay progressive reform. Another potential deal-breaker is health coverage for immigrants—an issue that has simmered just below the surface for a while now. A recent move by legislators in Massachusetts to drop some immigrants from that state’s health care roll could be a harbinger of what’s to come in federal health reform efforts.

The road to health care reform is peppered with landmines that threaten to derail passage of truly comprehensive legislation. Some of these landmines are predictable: cost projections that go beyond $1.6 billion; controversy over new taxes and a public plan; worries about rationing and a government-takeover of health insurance.

There are other, less obvious, issues that conservatives can use to ignite controversy. Abortion, which I’ve written about here, is one divisive issue that could delay progressive reform. Another potential deal-breaker is health coverage for immigrants—an issue that has simmered just below the surface for a while now. A recent move by legislators in Massachusetts to drop some immigrants from that state’s health care roll could be a harbinger of what’s to come in federal health reform efforts.

Hard Times for State Budgets

States are still struggling to make ends meet, even after huge budget cuts already this year. As states continue to tighten their budgets because of balanced-budget requirements, the recession keeps making things worse.

States are facing fiscal crises that just won’t stop. State tax revenue dropped 11.7 percent during the first quarter of 2009, according to the Rockefeller Institute. And April and May looked even worse. So states cut, and cut more. Many states had serious trouble balancing their budgets, even with the help of stimulus money, and some, like California, ran into overtime. Pennsylvania, Arizona, and North Carolina still haven’t passed their budgets yet, even though the fiscal year started July 1.

Now the problem is getting even worse. States are already seeing budget gaps increase – even though they just closed deficits for the FY 2010 budget. At least 10 states are projecting another $3 billion in budget cuts, even before next year’s budgetary process.

Blue Dog Confusion

In “Getting Better Value From Medicare” I have written about how Medicare reform could pave the way for health care reform. The current House Bill would do just that. It includes many excellent suggestions for containing Medicare spending in ways that would lift the quality of care.

If health care reform includes a public sector insurance plan, that public sector insurer would incorporate many of Medicare's reforms, offering Americans better care at a lower price. We cannot count on for-profit insurers to do this. We need a strong public sector insurer. 

Superpowers

On October 1, the People’s Republic of China will celebrate the sixtieth anniversary of the revolution that gave Mao Tse-tung and the Communist party control of a vast, chaotic, and depleted nation. Today’s China has become a superpower, a country that in scale, ambition, and demonstrated success will be a dominant global force in the twenty-first century. As it happens I was a correspondent in the Soviet Union in 1977, the year it marked the sixtieth anniversary of its own Communist revolution. It too was then an acknowledged superpower that, along with the United States, sought to project military capacity and ideological hegemony the world over. Yet only fifteen years later, the Soviet Union disappeared, its empire shattered, its economy in ruins.

So the logical question about China as it approaches this benchmark is whether its upward trajectory will endure and, if so, what form it will take, and with what consequences for the 1.4 billion Chinese and the rest of us. I have been to China on three trips since 2006 for a total of a month, spending time in Beijing, Guangzhou, Hong Kong, Guilin, and the surrounding countryside. These have been private forays without official briefings but with significant access to journalists and other resident observers. I’ve also had some experience now with China’s infrastructure of airports, roads, and markets both traditional and modern, as well as encounters with its civil bureaucracy. But mine are a visitor’s impressions, certainly not an expert’s.

"Wall Street Journal Health Care Editorial Wrong on the Facts"

That was the headline on a memo prepared by the staff of the House Education and Labor Committee and released by House Speaker Nancy Pelosi’s office last week. The amount of misinformation circulating out there about the House bill is growing.

Clearly, the conservatives are running scared. It’s not surprising when a Wall Street Journal editorial offers a unique interpretation of what is happening in Washington. The paper’s editorialists are known for their distinct perspective on American politics. But now, they are resorting to outright lies. Below, the text of the memo:

"The Wall Street Journal ran an editorial today [Tuesday, July 21] that advanced false and misleading information regarding the House’s health reform bill, America’s Affordable Health Choices Act  (H.R. 3200).

Public Backs Funding for Scientific Research

The Obama administration has put a strong emphasis on scientific research, backed up by funding commitments in the 2010 budget. And this appears to be simpatico with the views of the American public. A new survey from the Pew Research Center shows that the public, by 60-29, thinks government investment in research is essential for scientific progress, rather than believing that private investment can ensure scientific progress without government investment.

And when queried about whether government investments in basic scientific research—and in engineering and technology—pay off in the long run, the public overwhelmingly said yes in both instances: 73-18 for basic scientific research and 74-17 for engineering and technology.

Compensating Physicians for the Trust We Place in Them

As always, Princeton economics professor Uwe Reinhardt brings a provocative perspective to a sensitive subject: physician pay. Turning to Adam Smith’s An Inquiry Into the Nature and Causes of the Wealth of Nations (1776), Reinhardt focuses on Chapter 10 of Book 1, titled “Wages and Profit in the different Employments of Labour and Stock” as the text for an Op-ed published in the New York Times. 

Reinhardt observes that, when it comes to physicians and lawyers, Smith “appeared to lean on the medieval doctrine of ‘just price.’ Thus he wrote:”

“We trust our health to the physician: our fortune and sometimes our life and reputation to the lawyer and attorney. Such confidence could not safely be reposed in people of a very mean or low condition. Their reward must be such, therefore, as may give them that rank in the society which so important a trust requires. The long time and the great expense which must be laid out in their education, when combined with this circumstance, necessarily enhance still further the price of their labour.”

Minimum Wage Day

The best economic news this year for millions of Americans is not the Dow crossing 9000 – it’s the minimum-wage increase that goes into effect today.

 4.5 million workers will get a raise, to $7.25 per hour, and employers will have to pay $1.6 billion more per year. (For some reference, Goldman Sachs is paying its 29,400 employees about $6 billion more this year than last.) The last time the minimum wage was this high, in inflation-adjusted terms, was the early 1980’s. But we are still a ways off from the $9.00+ minimum of the late 1960’s. To ensure that the minimum wage isn’t forgotten about again, Congress should pass legislation increasing it more in future years, perhaps by pegging the wage and inflation rates.

Climate heartburn

Secretary of State Hillary Clinton charmed Indians this past week, telling them that she is hooked on the subcontinent's famously spicy cuisine.  But even if she did "eat way too much of the food," as she told a town hall meeting in New Delhi, that would not explain the heartburn that scorched her delegation during her visit.

Rather, that feeling of acid reflux was triggered by Indian's environment minister, Jairam Ramesh, who very publicly confronted her on what is arguably President Obama's highest global priority, a rigorous climate change agreement. India cannot and will not "take any legally binding emissions reductions" as part of a worldwide effort to halt global warming, he declared. 

Putting Health Reform's Costs in Perspective

Include the tab for expanding Medicaid, and the proposal for health care reform that the Senate Health, Education, Labor, and Pensions (HELP) Committee approved last week will probably cost $1.6 trillion, report the Urban Institute’s Linda J. Blumberg and John J. Holahan in a brief titled: “Beyond the $1.6 trillion sticker shock.”

This “is clearly a considerable sum,” acknowledge the researchers, who were funded by the Robert Wood Johnson Foundation. They note that when the Congressional Budget Office (CBO) announced that it guessed the Senate Committee’s health plan could cost that much, “the estimate caused the committee to stop its deliberations,” and set a new goal: “a plan that would cost closer to $1.0 trillion.”

But perhaps Finance Committee Chairman Senator Max Baucus didn’t need to panic. As Blumberg and Holahan point out: “The $1.6 trillion is a 10-year number,” measuring how much reform is expected to cost the nation between 2010 and 2019. Meanwhile, over that same span the Congressional Budget Office (CBO) projects that total GDP will “equal $187 trillion.” 

Thus, they observe, “the estimated gross costs of health reform are less than 1 percent of the GDP over ten years.”