Bluegrass Beacon: Control costs, make health care great again

BluegrassBeaconLogoThe latest RINO to lose is the Repeal In Name Only health-care bill – also known officially as the American Health Care Act (AHCA) – meant to replace the Affordable Care Act (ACA).

To paraphrase Kentucky Sen. Rand Paul, what’s the point in replacing a program that subsidizes, taxes, punishes and practices conniving cronyism with a policy that promises a “refundable tax credit” (subsidizes), financially castigates those with good insurance (taxes), forces individuals who allow their coverage to drop to pay 30 percent more to insurance companies just to get reinstated (punishes) and props up insurance companies with $100 million of “reinsurance” funding (conniving cronyism)?

Nothing offered by Washington in either of these approaches effectively addresses the primary culprit in the current health-care fiasco: cost.

Forcing insurers, for example, to cover an array of 10 “essential health benefits” – from maternity care to mental health and drug abuse – greatly drives up the cost of premiums for everyone.

Why, for example, is a 65-year-old man forced to purchase a health-insurance plan that includes maternity coverage?

Such mandates drive up the cost of his plan, and, depending on his financial status, may require a taxpayer-provided handout to help him afford the premium, making him dependent on government to pay for his insurance that includes coverage for services he neither wants nor needs.

If we’re going to include government subsidies in our health-insurance policy, why don’t we at least do it in a way that actually helps some folks truly in need without penalizing everyone else?

Supporters fear getting rid of Obamacare would result in really sick people with longstanding illnesses being left without access to adequate coverage.

It doesn’t have to be that way if privately run high-risk pools are allowed as part of any “replacement” agreement.

Just like swimmers “share” the pool’s water, so participants with preexisting health conditions divvy up coverage costs.

Since participants in such a plan offer a much higher risk of filing claims and using health-care services, premiums will be higher than those of healthy consumers in the individual market.

Government can intervene in a limited manner by providing subsidies to people in these pools that help bridge the gap between lower incomes and higher premiums.

Taking this approach reveals a stark contrast between a safety-net program and sledgehammer-to-an-ant approach that happens when government tries to run the entire health-care system.

It’s the distinction between offering food stamps to low-income individuals to purchase their groceries versus government running the grocery stores.

Witness the disaster known as “Section 8 housing” and understand: there’s a considerable difference between government offering housing vouchers to assist lower-income citizens in finding a place in the private marketplace to rent and the demonstrated public-housing debacle found in cities in the commonwealth and across the nation.

Such a policy would help folks with preexisting conditions engage in their own care as they shop to find a plan that works best for them – the process of which will expose them to what their coverage truly costs and the care they can expect to receive.

Neither the ACA nor the ACHA does much of anything to engage individuals – with or without preexisting conditions – in their own care, especially when it comes to knowing the cost of products like prescription drugs or services such as surgeries.

The combination of consumers not knowing anything about the price tag of their care while government mandates products and services insurers must provide and then turns around and subsidizes them offers little incentive to providers to control costs – the primary obstacle to making America’s health-care system great again.

Jim Waters is president of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free-market think tank. Read previous columns at www.bipps.org. He can be reached at jwaters@freedomkentucky.com and @bipps on Twitter.

Bluegrass Beacon – Obamacare: Public policy malpractice

BluegrassBeaconLogoReviews on cable news and social media of retired Kentucky Gov. Steve Beshear’s response on behalf of the Democratic Party to President Donald Trump’s first – and powerful – speech to a joint gathering of Congress aren’t great.

Speaking while seated in a diner with a small group of attendees who appear largely impassive in a let-us-know-when-we-can-get-back-to-the-pie-and-coffee sort of way, Beshear’s canned and casual approach made it seem more like he was headed to a backyard barbecue than offering a serious response to the commander-in-chief’s weighty address.

“Small and stunty,” panned liberal MSNBC commentator Rachel Maddow.

However, “to be fair to Beshear, going after that Trump speech is like taking the stage after a U2 set with nothing but a ukulele in your hands,” radio talk-show host Buck Sexton tweeted.

If life hands you a ukulele, at least find an effective composition to play.

Nothing is ever as effective as truth – especially in these days of fake news and alternative facts.

Alas, it seems all Beshear can locate is “Obamacare’s Concerto for Ukulele and Liberals in F (for Failure) Minor” as he remains stuck on maintaining that 22 million more Americans, including a half-million Kentuckians, “now have health care that didn’t have it before.”

At least 14.5 million of those Americans – including more than 400,000 Kentuckians – got their coverage through the misnamed Affordable Care Act’s expansion of Medicaid eligibility, which simply means that all previously uninsured citizens on Medicaid now have is a card in their pockets identifying them as government-program beneficiaries.

No assurance of actual care exists.

But that’s just one of the problems with off-key claims by Beshear and his fellow Obamacare supporters. Consider also:

  • Obamacare provides a costly barrier to needed care.

A Families USA study shows that premiums for high-deductible plans purchased through Obamacare’s exchanges are increasing by double-digit amounts and more annually – 116 percent in Arizona last year alone – resulting in one in four of those customers skipping doctor’s appointments and medical tests while struggling to pay the bigger invoices.

How does this add up to better care or lower costs?

  • Labor-force participation is dropping in states using Obamacare to expand Medicaid.

While Beshear spoke of unemployment-rate drops, fiscal experts are more concerned about Obamacare’s impact on discouraging people from even looking for work.

Georgetown University researcher-turned government analyst Tomás Wind reports that “expanding Medicaid is associated with a 1.5 to 3 percentage point drop in labor force participation” in states that chose to join in the expansion.

  • Obamacare perversely drives up costs then punishes individuals who work extra to pay for it.

People who’ve taken extra jobs to cover double-digit increases in premiums for policies obtained through Obamacare’s exchanges risk abruptly losing thousands of financial-aid dollars.

Tort reformer Ted Frank of the Manhattan Institute Center for Legal Policy used the Kaiser Foundation’s Health Insurance Marketplace Calculator to show how a 62-year-old earning $46,000 in a high-cost area suddenly loses the $7,836 tax credit that helps cover his premium if he earns just $22 more.

Hans Bader of the Competitive Enterprise Institute in noting Frank’s example writes that while it makes sense to “gradually phase out” subsidies for those whose incomes rise and who need less government help, Obamacare takes a “far more extreme and indefensible” approach.

“It suddenly takes away thousands of dollars in subsidies when many people earn a few extra dollars – blindsiding many of them in the process,” Bader writes. “… That leaves them much worse off than if they had never earned that extra income, potentially leaving them poorer for taking on a second job to pay the costs of their health insurance.”

It’s so severe that our 62-year-old will have more take-home pay if he earns $46,000 than if he reaches $55,000.

Frank’s conclusion: “This is just public policy malpractice.”

Jim Waters is president of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free-market think tank. Read his weekly Bluegrass Beacon column at www.bipps.org. He can be reached at jwaters@freedomkentucky.com and @bipps on Twitter.

Bluegrass Beacon: Set the table for a school-choice buffet

BluegrassBeaconLogoPresident Donald Trump’s administration is taking some cues from the productive Kentucky Legislature.

After a frenetic first week of the 2017 session of the Kentucky General Assembly during which seven bills were passed, the new Trump administration offered a proportional amount of accomplishment during its first five days in the White House.

Trump took 15 major actions in his first five days, including steps toward ending Obamacare and withdrawing the nation from the Trans-Pacific Partnership – a victory for Kentucky farmers, who grow more than 87,000 acres of tobacco annually.

I called for both actions in this column during the recent election season.

The Obama administration embedded its hatred of the tobacco companies into the 12-nation TPP deal, excluding these firms from protections available to all other industries against foreign governments taking property without compensation or seizing assets in the name of “public health.”

While the deal contained some attractive tax and tariff cuts, it’s unacceptable to single out a specific industry and its legal product based on ideology and the running amok of political correctness.

Still, it’s important for our nation’s security and for Kentucky farmers and manufacturers to maintain a strong, open trading relationship with willing countries.

As Frederic Bastiat, the great 19th century free-market French economist, believed: “If goods don’t cross borders, armies will.”

Democrats who lost the Kentucky House on the same night they turned over the keys to the White House complain about the feverish pace of it all.

Yet most of the legislation debated and passed in Frankfort during the first week in January – right-to-work, repeal of costly prevailing-wage mandates on public construction projects, making part-time politicians’ pensions transparent and pro-life bills – had been debated and passed by the state Senate for years.

School-choice legislation also fits that scenario.

It’s likely this session won’t end before Kentucky becomes the 44th state with a charter-school law and perhaps also the 18th state to turn tax-credit-friendly donations into scholarships allowing children from countless numbers of families access to a private education.

Louisville Rep. Phil Moffett’s charter-school legislation would offer Kentucky’s kids the opportunity to attend schools that will allow them, in many cases, to break the cycle of generations of poverty, illiteracy and failure.

Opponents continue to offer recycled claims about how empowering parents to choose the school that best fits their children’s educational needs somehow is a vast right-wing conspiracy to destroy public education.

But wait a sec’.

Charter schools are public schools.

Along with the reality that policies like Moffett’s bill haven’t caused an implosion of public education in those 43 other states is the expectation hardworking taxpayers have when they fork over their hard-earned dollars – $10.1 billion designated for K-12 schools in the commonwealth’s current biennial budget.

They want their money used for educating children, not propping up failing systems or sustaining jobs programs for adults.

While discussing his bill at a recent education forum in an inner-city church in West Louisville, Moffett told the largely minority crowd: it’s time to take a cue from its neighbor to the North.

Indiana is changing its approach – “to thinking about public education, not public-school systems,” the former GOP gubernatorial candidate said.

The shift has resulted in many more options for Hoosier State parents – from charter schools to vouchers to tax-credit scholarships and even individual tax credits for private-school enrollment and tax deductions for homeschooling families.

The Hoosier State has one of America’s biggest school-choice buffets and fastest-growing economies.

Kentucky will take major steps toward setting its table with the same kind of spread with similar results when it gets back in the kitchen on Feb. 7.

It can’t happen fast enough.

Jim Waters is president of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free-market think tank. Read his weekly Bluegrass Beacon column at www.bipps.org. He can be reached at jwaters@freedomkentucky.com and @bipps on Twitter.

Bluegrass Beacon – Required: Full, fast repeal of Obamacare

BluegrassBeaconLogoRepublicans kept control of the Senate and House of Representatives in Washington after sending an Obamacare-repeal bill to the desk of the law’s namesake last January and also won the White House on a campaign platform of dismantling the disastrous health-insurance policy.

It didn’t hurt them in Kentucky, either, where the GOP won control of the House for the first time in nearly a century and now hold a supermajority in both chambers.

What will the Grand Old Party in Washington do with this momentum?

Not only is the first 100 days of this new Congress the right time to get rid of Obamacare, it will never be easier to meet demands for full repeal by impatient voters in no mood to accept a new coat of paint or touch-up job.

It must be dismantled “root and branch,” as Senate Majority Leader Mitch McConnell, R-Ky, said.

No portion of Obamacare serves as a better example of the need for immediate and complete repeal than the Medicaid expansion, which created a new welfare category for able-bodied adults, resulting in one out of three Kentuckians becoming dependent on government-run health care.

Since its launch, enrollment and costs in states choosing to opt in exploded.

While about 188,000 were originally expected to sign up for the program in Kentucky, 430,000 – more than double the projected maximum enrollment – ended up enrolling.

The result? The truly needy got pushed to the back of the line while working-age, non-disabled adults get free welfare.

Kentucky Gov. Matt Bevin’s administration is seeking to address this situation in its pending waiver request of the federal government, which doesn’t affect any Kentuckian enrolled in Medicaid before its expansion; neither does it change benefits for children, expectant mothers or the medically frail.

It merely requires able-bodied adults who enrolled in Medicaid as part of the expansion to, as Bevin insists, have “skin in the game” by offering healthy incentives rather than encouraging dependency.

Ultimately, the goal is for recipients to engage in their own employment and health care so they move out of safety-net programs meant to be transitional and temporary into private, traditional and permanent employer-provided insurance plans that provide better and more immediate care.

This new welfare program that voters clearly don’t want also threatens to crowd out funding for infrastructure, public safety, education and public-pension crises – taxpayer priorities in most states, including Kentucky.

Congress has reasonable options for ending this expansion.

It could freeze Medicaid enrollment by allowing current recipients to remain until no longer eligible, giving them sufficient time to explore alternatives.

Starting the rollback now would buoy voters’ confidence that the majority party plans to keep its longstanding repeal promise and free up limited resources for the truly vulnerable, including 2,000 Kentuckians with intellectual and developmental disabilities currently languishing on Medicaid waiting lists.

This freeze approach has worked in other states, including Maine and Arizona, where able-bodied enrollees immediately returned to a life of independence, instantly loosening limited taxpayer dollars for use toward ensuring access to care for truly vulnerable residents.

Congress should also implement two reforms to preserve Medicaid for the truly needy: require work for able-bodied, working-age adults on Medicaid as Bevin and other governors support and allow states to check Medicaid eligibility more frequently to remove fraudsters.

Reform cannot happen too soon.

McConnell rightly insisted: “We must act quickly to bring relief to the American people.”

Each day the costly and unpopular Obamacare policy lingers is a day too long.

Anything less than immediate, full and unvarnished repeal would be a violation of voters’ trust and could – and should – have severe ramifications during upcoming elections.

 Jim Waters is president of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free-market think tank. Read his weekly Bluegrass Beacon column at www.bipps.org. He can be reached at jwaters@freedomkentucky.com and @bipps on Twitter.

Bluegrass Beacon: Congress should evaporate Obamacare’s ocean

BluegrassBeaconLogoGeologists are concerned that the Dead Sea’s water level is dropping faster than Santa from the North Pole on Christmas Eve.

Experts estimate the water level in this famous sea separating Israel and Jordan dropped by more than 131 feet since the 1950s and continues to lose more than three feet of water annually.

It’s not because too much water is somehow flowing out of the Sea of Salt, as it’s known.

One of the sea’s unique features is that it’s the terminal lake of the equally famous River Jordan. Water flows in from the Jordan but none flows out.

Scientists believe evaporation is a contributing factor.

Rep. Brett Guthrie, R-2nd District, rightly believes Washington’s budget process can be used to evaporate another sea – Obamacare’s ocean.

This approach allows Congress to use its power of the purse to weaken a dreadful plan while, at the same time, providing a strategy for transitioning millions of Americans who receive some type of subsidized coverage into better – and affordable – policies.

As Guthrie told me, Congress can use the budget process to “repeal everything in Obamacare that’s a spending or tax item.”

That, of course, includes mandates and their accompanying fines.

While the Supreme Court’s ruling allowing Obamacare to proceed was, in the annals of judicial history, as low as the Dead Sea’s surface – Earth’s lowest point – the black-robed justices at least correctly branded as a “tax” the Obamacare penalty cuffed on certain employers and individuals choosing not to offer or purchase coverage.

Evaporating Obamacare’s sea rather than draining its swamp allows Congress to expeditiously exorcise the health-care boondoggle’s worst demons while saving its best angels.

“Congress has the power to tax,” Guthrie told me. “So, you can choose whether or not you buy it, but if you choose not to buy it, then you have to pay a tax. So, what we (Congress) can say is: you don’t have to pay the tax.”

Since the budget-reconciliation process, which finalizes the spending plan for our current fiscal year, will be at the top of Congress’ agenda when it returns to Washington in January, eliminating this tax by the end of February could provide an economic boost to a lot of Kentuckians.

Congress can – and should – do this.

It would give badly needed breaks for low- and middle-income families who otherwise would receive smaller-than-needed federal tax-return checks this spring resulting from increased penalties for not purchasing unaffordable coverage.

Evaporating Obamacare’s swamp by choking it at its point of funding – without necessarily waiting until it has every replacement policy in place – allows Congress to:

  • Avoid the Senate’s 60-vote threshold requirement, which would be enforced on a stand-alone repeal bill. Meeting this bar would be difficult considering the GOP holds only a 52-46 seat majority in the Senate; budgets, however, require only a simple majority vote.
  • Give providers and insurers the opportunity to recover from Obamacare’s disastrous effects and reset plans with some confidence they can survive and stabilize.
  • Address egregious funding issues created by Obamacare, including the $716 billion worth of Medicaid cuts used to pay for the imploding health-insurance debacle.

Evaporating the sea using this strategy would offer a beautiful constitutional approach toward getting rid of the current health-insurance ugliness.

It would reassert Congress’ power of the purse at a time when the unconstitutional growth of both the judicial and executive branches during Obama – and Obamacare’s – tenure must be reversed.

Scientists are concerned the Dead Sea might eventually dry up.

It won’t happen in our lifetime, but let’s hope the worst aspects of Obamacare evaporate into thin air during the next gathering of Congress.

Jim Waters is president at The Bluegrass Institute for Public Policy Solutions, Kentucky’s free-market think tank. Read his weekly Bluegrass Beacon column at www.bipps.org. He can be reached at jwaters@freedomkentucky.com and @bipps on Twitter.

Bluegrass Beacon: Read the side of Obamacare’s box

BluegrassBeaconLogoLike food makers claiming “fat free” on the front of the box only to have a close reading of the ingredients on the side of that same box reveal a product packed with unhealthy, unpronounceable names of chemical toxins, Obamacare’s cheerleaders gush forth superficial claims about the reform policy’s success.

For instance, supporters in Kentucky and nationwide slapped a label in big letters on the front of Obamacare claiming “dramatic drop in the number of uninsured” while on the side of the box you discover a product packed with unsavory ingredients like “misleading claims.”

Just days before a recent government report forecasting a 25-percent increase in premiums in the 39 states that use HealthCare.gov, the federal Obamacare exchange which Kentucky joins on Nov. 1, President Obama proudly claimed to college students in Florida that “another 20 million Americans would know the financial security of health insurance” because of his reforms.

We’ve heard similar claims in Kentucky, where proponents allege the commonwealth’s Obamacare-induced programs reduced by a half-million the ranks of the uninsured.

Yet 80 percent of Obamacare’s enrollees in Kentucky were dumped into Medicaid, which is, as a recent Wall Street Journal editorial noted, “a failing program that provides substandard care.”

Nationally, 97 percent, or nearly 9 million of the 9.25 million newly insured who enrolled for coverage using the federal platform or one of the state Obamacare exchanges, wound up in the government-run Medicaid program.

Obama says states shouldn’t worry about future costs of such dramatic increases in Medicaid enrollment, because, after all, “the federal government is paying for it.”

Yet states will be required to start picking up a significant portion of the bill delivered by their expanded Medicaid populations next year.

How does Obama expect Kentucky with its worst-in-the-nation pension crisis to pay for an additional 400,000 Medicaid enrollees?

Does the federal government have a special printing press somewhere designed to spit out special Benjamins just to pay for this failed experiment in government-run health insurance?

Besides, have you checked your pay stub?

If you see “SWT” and “FIT,” it means that not only have you been paying for your state’s Medicaid program and its expansion — which, in Kentucky’s case, was $1.8 billion higher than expected during its first 18 months in 2014 and 2015 — but guess who antes up when “the federal government is going to pay for most of it?”

Yep. That would be you, too.

Another reason for Obamacare’s implosion is its attempt to impose a one-size-fits-all regulatory and pricing scheme on both insurers and their customers.

Forcing men to pay for maternity coverage and denying healthy young people the opportunity to purchase a higher-risk, lower-cost plan isn’t exactly motiving millennials to sign up.

While these young adults may have flocked to former presidential contender Bernie Sanders while he was holding court during this year’s primary campaign to extol the virtues of forced sharing and the vices of liberty and profit, they’re not biting when it comes to surrendering their money and personal liberty to Obamacare and its mandates forcing insurers to charge younger, healthier people higher rates to pay for older, sicker patients.

While it would be difficult to find a more Sanders-like program than Obamacare, 18-to-34-year-olds are reading the side of the box where they find “likely failure” among the ingredients and are choosing instead to forego the higher rates and pay the fines instead.

In fact, this demographic group purchases only about a quarter of the Obamacare plans when actuaries say 40 percent is required to offset the costs incurred by older, sicker workers.

Insurers, unable to keep carrying such significant losses, are fleeing the Obamacare exchanges faster than Aroldis Chapman’s fastball, leaving customers with fewer choices and even-higher costs.

Jim Waters is president of the Bluegrass Institute; Kentucky’s free-market think tank. Reach him at jwaters@freedomkentucky.com. Read previously published columns at www.bipps.org.

Bluegrass Beacon – Medicaid reform: Compassionate or cruel?

BluegrassBeaconLogoAn example of how the British government in the 19th century used the magic of incentives to improve survival rates of prisoners transported on ships to Australia could offer clues about how to right Kentucky’s listing Medicaid program.

For years, barely half the Australian-bound prisoners survived these voyages.

Despite ardent appeals from church, humanitarian and government leaders imploring ship captains to improve conditions, survival rates failed to change.

Finally, social reformer Edwin Chadwick recommended offering different incentives by adjusting how ship captains were compensated.

Chadwick suggested that instead of paying captains a fee for each prisoner who walked onto their ships in England, they would be paid only for prisoners who walked off ships in Australia.

Changing the incentives for captains immediately and dramatically improved survival rates to more than 98 percent.

Captains now protected prisoners’ health and well-being by providing them with better food and hygiene during their passage, as well as reducing the number of inmates crowded into each ship.

Incentives achieved what even appeals from the clergy failed to accomplish.

The right kind of inducements also can bring about some dramatic improvements in Kentucky’s health-insurance policy.

Adding hundreds of thousands of Kentuckians to Medicaid by expanding eligibility resulted in dangerously overcrowding the commonwealth’s Obamacare ship.

Close to 30 percent of Kentucky’s entire population is now crammed into this tilting vessel.

Supporters of the government-run plan brag about and receive nationwide acclaim for building such a beautiful, shiny sparkling ship.

Yet stroll through the lower decks and you will find an overloaded vessel with humiliating conditions from which too many enrollees may never exit – unless incentives are changed.

Plus, as degrading as the conditions on those British ships were, the captains always knew their destination.

However, a major point of confusion concerning Kentucky’s Obamacare ship is its true terminus.

Not everyone agrees that the anchor of government dependency should be lifted, allowing this ship to sail into a harbor filled with opportunities for able-bodied adult Kentuckians to find decent jobs and earn a good living in order to achieve the kind of lifestyle that allows them to purchase their own health-insurance plans and receive care from doctors they choose.

Opponents of Gov. Matt Bevin’s Kentucky HEALTH plan – which seeks to improve the chances of most of the recent Medicaid enrollees reaching a destination of dignity by paying a small premium, getting treatment for an addiction, training for a job or volunteering in their community – seem wholly uninterested in allowing anyone off the ship.

They go to great lengths to avoid confronting their antagonism toward teaching fellow Kentuckians to fish instead of keeping them dependent on government fish.

They also often attempt to change the conversation altogether by focusing on groups that will experience little, if any, change should Washington approve the Bevin administration’s proposed reforms.

Absolutely nothing in Bevin’s plan would, for example, change benefits for children, pregnant women, the disabled or poor.

Still, a letter writer in western Kentucky thinks I’m “mean-spirited” and “lacking compassion” because I support incentives designed to get prisoners off the ship, out of a defeated and miserable lifestyle into a victorious, productive life.

How compassionate is it to adamantly oppose incentives that will keep Kentucky’s Medicaid ship from sinking by sailing into the harbor and unloading able-bodied adults crammed onto its decks, giving them the opportunity to move into a place where they can contribute greatly to our society and maybe even help others?

If the Obama administration wants to show true compassion, it not only will approve the Bevin administration’s waiver request to implement the HEALTH plan’s thoughtful and reasonable incentives, it will do so immediately and enthusiastically.

Jim Waters is president of the Bluegrass Institute; Kentucky’s free-market think tank. Reach him at jwaters@freedomkentucky.com. Read previously published columns at www.bipps.org.

Bluegrass Beacon: Declare independence from dependency!

BluegrassBeaconLogoGov. Bevin is trying to help all able-bodied Kentuckians who want to declare their independence from government dependency by offering Kentucky HEALTH, a program designed to inject some personal responsibility and savings – the two usually work in tandem – into the commonwealth’s health-insurance policy.

Many of the one in four Kentuckians who now rely on Frankfort for coverage could pay their own way but are incentivized by the recent Medicaid expansion not to do so by offering them benefits paid for by productive taxpayers instead.

Such behavior was encouraged by former Gov. Steve Beshear, Bevin’s predecessor, who implemented program via executive orders and without a vote by the legislature – even though taxpayers are on the hook for such programs.

Had the expansion been put through the legislative process, the issues of whether it was sustainable and how we could keep it from yanking the chains of government dependency even tighter around the working poor’s necks would have been debated.

There are many good reasons why Bevin is right in acting to get rid of the exchange, move its current customers to the federal exchange and reform the state’s Medicaid policy. They all ultimately crawl back to the original problem: unsustainable costs.

Before the exchange even entered its second year, its largest insurers requested double-digit premium increases as sick Kentuckians were pulling up to the trough and turning in large claims for chronic health problems they ignored for years. Meanwhile, the federal government reneged on its promise to increase funding to address the astronomical costs of this expected surge.

The feds also have promised to continue to pick up a major part of the cost incurred by states, like Kentucky, who expanded Medicaid eligibility. Why should we believe them?

If nothing else, consider HEALTH a contingency plan in case Washington’s check doesn’t arrive.

Now that Bevin’s proposing that adults able to work should do so, or at least be productive in volunteering, going to school or getting job training, you would have thought – based on the opposition – that Chicken Little had moved into the governor’s mansion and started shooting up on steroids.

But read the plan for yourself at the state’s Cabinet for Health and Family Services website, and you will be struck by how similar the HEALTH proposal is to the coverage enjoyed by state workers.

We don’t – and won’t – hear anyone saying state workers have poor benefits.

Some current recipients and representatives of social-welfare groups who think little and care less about the cost of government services are sniveling about Bevin’s fairly modest proposals designed to ensure these programs can continue in some meaningful form.

However, by opposing this plan, opponents stand the chance of losing it altogether as Bevin made it clear: If these reforms aren’t implemented, the Medicaid expansion will be rolled back altogether.

Perish the thought that even low-income individuals might have to accept some responsibility for their own selves by paying small premiums – $15 at the most – to remain in the Kentucky HEALTH plan and receive Medicaid benefits.

Many would pay only about half that amount with – on top of all that – a 60-day grace period before having their accounts suspended.

Responses I’ve heard from some hard-working Kentuckians who take on extra jobs and make other sacrifices in order to afford the hundreds of dollars they pay monthly just to cover their own families is utter disbelief.

They’re livid at the unfairness of it all.

They pay the health-coverage bills of able-bodied adults who jumped on the merry-go-round of government dependency sped up by Beshear’s Medicaid expansion but who now show up at public meetings to squeal about $10 premiums.

Of course, if you’re not working and laying around watching soap opera reruns and eating Twinkies, you can probably pull yourself together long enough to go and protest a policy of personal responsibility in the middle of the day.

Most of us working to pay for their indolence probably won’t be able to make it.

Jim Waters is president of the Bluegrass Institute; Kentucky’s free-market think tank. Reach him at jwaters@freedomkentucky.com. Read previously published columns at www.bipps.org.

Testimony offered to Senate Health and Welfare Committee opposing legislative approval of Kynect and Medicaid expansion

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The following is an edited presentation of testimony offered by Bluegrass Institute CEO Jim Waters to the Kentucky Senate Health and Welfare Committee on April 11, 2016, in Frankfort.

Good morning ladies and gentlemen. I’m Jim Waters, president of the Bluegrass Institute for Public Policy Solutions at bipps.org. The Bluegrass Institute is a free-market think tank focused on offering common sense, economically sound solutions to Kentucky’s greatest challenges.

Certainly one of the great challenges faced by too many of our fellow Kentuckians is finding affordable health insurance that provides an acceptable quality of care. Yet while the intention of government programs – and of most policymakers who vote for them – is to help the less fortunate, they often end up not only falling far short of fulfilling those intentions, but actually harming the very constituency they are meant to assist.

Kynect

When former Gov. Steve Beshear established the state-based exchange Kynect by executive order in 2013, his administration projected the online insurance marketplace would provide 332,000 uninsured Kentuckians with access to affordable coverage. Yet fewer than a third of that anticipated number actually ever obtained coverage through the state-based exchange.

Seventy-five percent of those who signed up for plans on the exchange are being forced to find a new insurer as the Kentucky Health Cooperative, the exchange’s largest insurer, is closing down after losing $50 million last year – the most of any of the 22 Obamacare-subsidized cooperatives nationwide.

Even if the co-op would have remained open, its request to raise premiums by 25 percent during this past year – had they remained opened – combined with the previous year’s 20 percent in rate hikes would no doubt have exacerbated the situation reported by a recent study by Families USA study showing that high-deductible plans purchased though the state exchanges have resulted in one in four of those customers skipping doctor’s appointments and important medical tests.

[Read more…]

Bluegrass Beacon: Second chances for felons and taxpayers

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Editor’s note: This column originally was released to newspapers before passage of House Bill 40, which creates a process giving some low-level criminals a one-time opportunity to apply to a court to have their records expunged following a five-year waiting period and paying a $500 fee after completing their sentences. The column has been updated to reflect passage of that legislation, which now awaits Gov. Matt Bevin’s signature.  

It’s time for another edition of “Liberty Boosters and Busters,” courtesy of the 2016 session of the politically divided Kentucky General Assembly.

Liberty Booster: Cameron Mills

The University of Kentucky Wildcats may have been eliminated from this year’s NCAA basketball tournament early, but ghosts of Wildcats past are alive, well and made their influence felt during this year’s General Assembly.

Cameron Mills, a walk-on guard who helped lead UK to its seventh national championship in 1998, joined with another winning team to bring about important criminal-justice reforms.

Mills testified before the Senate Judiciary Committee in favor of a proposal supported by a coalition made up of groups as divergent in political philosophies as citizens of the Cardinal and Wildcat nations in their basketball-team preferences, but who agree: some nonviolent felons deserve a single shot at a second chance.

Mills told WHAS talk-show host Leland Conway that he had “an epiphany” regarding this issue while speaking with two prisoners in the Kentucky State Reformatory Chapel.

The inmates, who only had about a month left on their sentences, dreaded their future freedom.

“I don’t have a chance when I get out,’” Mills said each man told him. “And the reason they didn’t have a chance is because these things were going to be on their records. They can’t get a job. … They’re not going to be able to afford to live, most likely. This is why so many go back to a life of crime. It’s just easier that way. And that’s what we want to avoid – is it not?”

Yes, it is.

Mills’ vocal support in conjunction with the Kentucky Smart on Crime coalition and persistent effort of Louisville Democratic Rep. Darryl Owens, who’s spent years on this legislative project, resulted in passage of a bill that creates a process allowing those convicted of some Class D felonies to seek expungement of their convictions five years after completing their sentences.

Liberty Buster: Rep. Darryl Owens

However, Owens also supported the very unsound House Bill 6, which seeks to preserve former Gov. Steve Beshear’s Obamacare-induced enlargement of Kentucky’s Medicaid program.

Beshear’s expansion happened via the former governor’s executive order and without the legislature – the only body constitutionally authorized to spend tax dollars.

The former governor’s actions resulted in 432,000 new Medicaid recipients which has grown total enrollment to its current 1.3 million, and – according to the Cabinet for Health and Family Services – combined state-federal spending to $10.4 billion this year alone on Kentucky Medicaid, which nearly equals the commonwealth’s General Fund budget … for the entire year!

All of this will happen while the federal government is still covering 100 percent of the cost of Beshear’s hundreds of thousands of new enrollees.

No one, including Owens and the entrenched big-spending House leadership, knows how high Kentucky’s Medicaid bills ultimately will rise – especially when the commonwealth’s taxpayers are required to start picking up the tab for some of the freight for those new enrollees in future years.

Beshear certainly didn’t offer a realistic plan on how to pay for his massive unconstitutional expansion.

Gov. Matt Bevin’s conservative approach requires Medicaid recipients able to carry more of their own weight – which includes many of the recent enrollees – to cover small copays and, in some cases, pay a portion of premiums for services that currently are totally free, courtesy of we, the taxpayers.

The Bevin administration also correctly discounts erroneous claims by Obamacare apologists like the Robert Wood Johnson Foundation, which released a new report containing unsupported claims that expanded government-run health insurance programs bolster Kentucky’s economy.

Isn’t this the same foundation that tossed $13 million toward Obamacare’s proliferation?

Why, yes! Yes, it is!

Shouldn’t a healthy dose of skepticism emerge about an organization wanting us to drink its Kool-Aid offered in the form of powdery “research” showing that an enormous part of the same big-government program it funded and propagated is good medicine for our commonwealth’s economy?

Why, yes! Yes, it should!

Jim Waters is president of the Bluegrass Institute, Kentucky’s free-market think tank. Reach him at jwaters@freedomkentucky.com. Read previously published columns at www.bipps.org.