The Heritage Insider: Why ObamaCare hurts cancer patients, IRS v. First Amendment, Obama is wrong about school choice, and more
Updated daily, InsiderOnline (insideronline.org) is a compilation of publication abstracts, how-to essays, events, news, and analysis from around the conservative movement. The current edition of The INSIDER quarterly magazine is also on the site.
March 1, 2014
Latest Studies: 49 new studies, including a Show-Me Institute report on the overstated problem of the transition costs of pension reform, and a Tax Foundation report on how to avoid the pitfalls of revenue-neutral tax reform
Notes on the Week: Why ObamaCare hurts cancer patients, IRS v. the First Amendment, Obama is wrong about school choice, and more
To Do: The greatest conservative show on earth begins this week
Budget & Taxation
• Forecast Bias of Government Agencies – Cato Institute
• Marginal Tax Rates and U.S. Growth: Flaws in the 2012 CRS Study – Cato Institute
• State Fiscal Policies for Budget Stabilization and Economic Growth: A Dynamic Scoring Analysis – Cato Institute
• Reform or Bust – Hoover Institution
• The Crisis Hits Home: Illinois’ Local Pension Problem – Illinois Policy Institute
• A Primer on State and Local Tax Policy: Trade-Offs among Tax Instruments – Mercatus Center
• Solvency and Insolvency of the MBTA Retirement Fund – Pioneer Institute for Public Policy Research
• IPERS – Is “OK” Good Enough? – Public Interest Institute
• New Mexico’s Unionized Employees Earn More than Their Non-Union Counterparts – Rio Grande Foundation
• Missouri Transition Costs and Public Pension Reform – Show-Me Institute
• The Proper Role of Congress in State Taxation: Ensuring the Interstate Reach of State Taxes Does Not Harm the National Economy – Tax Foundation
• A Short History of Government Taxing and Spending in the United States – Tax Foundation
• Keys to Avoiding the Economic Pitfalls of Revenue Neutral Tax Reform – Tax Foundation
Economic Growth
• India Property Rights Project: Empowering Hundreds of Thousands of Farmers – Grassroot Institute of Hawaii
• Mundane Truths: The L.A. 2020 Commission Diagonoses Problems Its Members Helped Cause – Manhattan Institute
• Why (Some) Downtowns Are Back: Lessons from the Urban Resurgence – Manhattan Institute
Education
• Common Core State Standards – John Locke Foundation
• The Effect of Co-Locations on Student Achievement in NYC Public Schools – Manhattan Institute
• Let’s Really Reform New Mexico’s Lottery Scholarships – Rio Grande Foundation
• Reclaiming Local Control of Education: Missouri House Bill 1490 – Show-Me Institute
Foreign Policy/International Affairs
• Will Elections in El Salvador Create a Narcostate? – American Enterprise Institute
• U.S. Should Demand Increased Transparency and Accountability as U.N. Revenues Rise – The Heritage Foundation
Health Care
• The Medical Care Cost Ratchet – Cato Institute
• Patients’ Compensation System – Georgia Public Policy Foundation
• Obamacare’s ‘Disincentive’ Scheme – Hoover Institution
• Medicare Drug Plans: Don’t Mess with Success – National Center for Policy Analysis
• The Impact of the Affordable Care Act in Washington State – Washington Policy Center
Information Technology
• The European Union’s Broadband Challenge – American Enterprise Institute
• FCC Preemption of State Bans on Municipal Broadband Networks Is Most Likely Unlawful – Free State Foundation
Labor
• The ‘Living Wage’ Strategy for Unions – Capital Research Center
• Four Things You Should Know About the Minimum Wage Debate in Hawaii – Grassroot Institute of Hawaii
• Minimum Wage Fraud Revisited—Again and Again – Grassroot Institute of Hawaii
• Minimum Wage Hype – Hoover Institution
Monetary Policy/Financial Regulation
• Contingent Liability, Capital Requirements, and Financial Reform – Cato Institute
• The Explicit Costs of Government Deposit Insurance – Cato Institute
National Security
• The Heritage Foundation 2014 Defense Reform Handbook – The Heritage Foundation
Natural Resources, Energy, Environment, & Science
• A Fresh Look at Climate Change – Cato Institute
• The Cosean Framework of the New York City Watershed Agreement – Cato Institute
• Where the Jobs Are: Small Businesses Unleash Energy Employment Boom – Manhattan Institute
Regulation & Deregulation
• Pathological Altruism and Pathological Regulation – Cato Institute
• No Retreat on Flood Insurance Reform – The Heritage Foundation
• Regulation Through Sham Litigation: The Sue and Settle Phenomenon – The Heritage Foundation
The Constitution/Civil Liberties
• A Lady or a Tiger?: Thoughts on Fisher v. University of Texas and the Future of Race Preferences in America – Federalist Society
• Can the South Carolina Legislature Pass a Law to “Nullify” Obamacare? – Federalist Society
• Policing for Profit: The Abuse of Forfeiture Laws – Federalist Society
• Discriminating Toward Equality: Affirmative Action and the Diversity Charade – The Heritage Foundation
• The Birth of Direct Democracy: What Progressivism Did to the States – The Heritage Foundation
• The Shadow Lengthens: The Continuing Threat of Regulation by Prosecution – Manhattan Institute
We knew last year that ObamaCare was going to hurt cancer patients. (Note: This post was our Throwback Thursday feature this week. Check the InsiderOnline blog on Thursdays to see what old content we’ll find that’s still relevant.) The warnings that ObamaCare would especially hurt cancer patients were given last year, but liberals still insist on seeing no evil today. This week, Stephen Blackwood shared his mother’s story with the Wall Street Journal. Mr. Blackwood’s mother had insurance that covered the cancer drug Sandostatin, which was helping to keep her alive and well. But in November, Blue Cross/Blue Shield cancelled the plan because it was not in compliance with the Affordable Care Act regulations. Blackwood describes what happened next:
When finally she found a plan that looked like it would cover her Sandostatin and other cancer treatments, she called the insurer, Humana, to confirm that it would do so. The enrollment agent said that after she met her deductible, all treatments and medications—including those for her cancer—would be covered at 100%. Because, however, the enrollment agents did not—unbelievable though this may seem—have access to the “coverage formularies” for the plans they were selling, they said the only way to find out in detail what was in the plan was to buy the plan. (Does that remind you of anyone?)
With no other options, she bought the plan and was approved on Nov. 22. Because by January the plan was still not showing up on her online Humana account, however, she repeatedly called to confirm that it was active. The agents told her not to worry, she was definitely covered.
Then on Feb. 12, just before going into (yet another) surgery, she was informed by Humana that it would not, in fact, cover her Sandostatin, or other cancer-related medications. The cost of the Sandostatin alone, since Jan. 1, was $14,000, and the company was refusing to pay. [Wall Street Journal, February 23]
Why exactly did Mrs. Blackwood get stuck with a plan that doesn’t cover a drug that is crucial to her health? Liberal opinion writer Michael Hiltzik offers this answer:
The ACA doesn’t dictate which medications are or are not offered by insurers, and the law certainly doesn’t demand that information on formularies be withheld from customers. It sounds as if Mrs. Blackwood was sorely misled by Humana’s customer reps, and it seems likely that its refusal to cover her crucial medication is unjustified.
That does point to a problem with Obamacare, just not the one Stephen Blackwood and the Wall Street Journal think it does. The problem is that the Affordable Care Act not only left commercial insurers at the center of our healthcare system, but strengthened their grip on coverage. Many of the problems that have cropped up with the ACA are reflections of the private industry’s role, including its lousy customer service.[Los Angeles Times, February 24]
Hiltzik would have us believe that the next expansion of government control will do what the previous one failed to do: Make sure that the health care system provides exactly the right balance of quality service and low cost. But why does anyone believe that government is better than individual consumers at judging tradeoffs between cost and quality? In a market system that has real competition, companies don’t win customers by providing lousy service and a low-quality product. Government regulations suppress the competition that produces the incentives to give customers value.
Right now, only Humana knows why it doesn’t cover Sandostatin. But a search for an explanation for Mrs. Blackwood’s predicament should at least note how ObamaCare gives insurers incentives to narrow their offerings. Fortunately, we have Scott Gottlieb, who explained it in a column from last August:
Obamacare coaxes health plans to reduce spending and healthcare utilization by limiting the choices patients will have of doctors. This is the primary way that health plans are being cheapened enough to meet Obamacare’s strict guidelines on the low value of the coverage that the plans can offer.
Insurers are barred from using the other tools that they’ve traditionally employed to keep the costs of policies in check: cost sharing, underwriting risk, adjusting premiums and benefits. The only thing that health plans are permitted to do under Obamacare is narrow the networks of providers that they contract with. So that’s precisely what they’re doing. By contracting with fewer providers, insurers can cheapen their coverage by clamping down on what doctors prescribe.
This will hit cancer patients especially hard.
If consumers go outside the narrow network of doctors that their plans offer, patients will be saddled with heavy co-insurance that can make these options absurdly expensive. While Obamacare caps a person’s total out of pocket costs, the price of getting care outside your restricted provider network isn’t subject to these limits (except for care delivered in an emergency room). If patients see doctors outside their narrow networks, they’ll have to pay out of pocket for that care. They could be stuck with the entire bill. There are no limits under the law (with the only exception being out-of-network medical care delivered in an emergency room).
Yet cancer patients often need the help of specialized doctors and cancer institutions that won’t make it into many of these cheapened networks. The latest cancer drugs, as well as new (off label) uses for existing medicines, will also be harder to get. Patients may not be able to see the expert doctors most likely to offer these options. New drugs are also slow to make it onto the “treatment pathways” that Obamacare plans are using as a way to narrow the menu of drugs they cover. [Forbes, August 21, 2013]
The people who wrote ObamaCare were focused on figuring out how to control health care spending. That was their priority, and so, in a controlled market, it becomes the priority of the providers; but that is not necessarily the priority of individual consumers. The only way to make sure the priorities of consumers rule is to put consumers in charge not the government.
Thirteen reasons to go to Resource Bank this year: The Heritage Foundation’s Resource Bank 2014 will be held March 26 – 28 in New Orleans. Here are 13 reasons you should register and join us:
13. Louisiana has a school choice program so good the Obama Justice Department just had to try to block it. You’ll learn how Louisiana’s education reforms are working.
12. You just can’t get a good gin fizz outside New Orleans.
11. Sen. Ted Cruz will make his second appearance at Resource Bank, but this will be his first as a United States Senator. Regular Resource Bank goers may recall that then-private citizen/former Texas Solicitor General Cruz spoke at the 2010 Resource Bank in Miami, about nine months before he announced he was running for the United States Senate.
10. New Orleans has the National World War II Museum, and Resource Bank attendees can sign-up to go to the museum for a reduced price.
9. Randy Barnett’s Commerce Clause argument against ObamaCare won at the Supreme Court, but the law was upheld anyway. Undaunted, he’s going to help us figure out the next steps in unwinding the law.
8. America needs energy. Louisiana has energy. Enough said.
7. If there is one thing you need to know about, it’s the Left’s plan to prevent conservatives from participating in the democratic process. A panel of heavy hitters—Cleta Mitchell, John Fund, Tracie Sharp, and Stanley Kurtz—will break it down for you.
6. Washington, D.C., has parasites, but New Orleans has insects—in the Insectarium, the largest museum of insects in North America.
5. You don’t want to miss the next awesome thing Gov. Bobby Jindal says.
4. The average high temperature for New Orleans in late March is 75 degrees.
3. Louisiana’s free market think tank, which is also the think tank with the coolest name, The Pelican Institute, will be there
2. Two words: Po Boys!
1. One word: Jazz!
Picture of the Week: Freedom turns the lights on. Here is the latest nighttime satellite image of the Korean peninsula, taken January 30, 2014, aboard the International Space Station:
North Korea is approximately in the center of the photo, but if it were not for the label, you might not realize there is land there. Business Insider explains the visual contrast by noting that annual per capita power consumption is 10,162 kilowatt hours in South Korea while the figure for North Korea is only 739 kilowatt hours. [Business Insider, February 24]
OK, but why don’t they have lights in North Korea? We suggest the explanation is that economies that are not free produce fewer resources than economies that are free. South Korea ranks 31st in the latest edition of the Index of Economic Freedom. The country’s score of 71.2 (out of 100) puts it in the Mostly Free category. Not bad.
North Korea, on the other hand, is dead last in the rankings with a score of 1.0. North Korea is in the Repressed category, a designation reserved for any country scoring less than 50. Twenty-seven other countries are rated “Repressed” by the Index, but North Korea is really in a league of its own.
If North Korea improved its score by 4,890 percent, it would have the same score as Togo—49.9. That would still leave North Korea in the repressed category. The Index notes: “The North Korean economy has been rated the least free throughout the history of the Index.” [2014 Index of Economic Freedom, The Heritage Foundation and the Wall Street Journal]
The Internal Revenue Service wants to use the tax code to regulate political speech. Undeterred by the scandal over its targeting of conservative non-profits for special scrutiny, the Internal Revenue Service now wants to make most of the things that 501(c)(4) nonprofits do count as political activity. Those rules would require these organizations to stop what they are doing or reorganize as 527 political groups that are required to disclose the names of donors.
Under the rules proposed by the IRS last November, 501(c)(4)s cannot do non-partisan voter-registration drives or provide issue guides that describe candidates positions. A number of newspapers are published by 501(c)(4) organizations; those news outlets would have to stop publishing articles that mention candidates names. The rules as written would require 501(c)(4)s to review everything on their websites to make sure no candidates names are mentioned within 30 days of a primary election or within 60 days of a general election—even if the content was published before then. Under the IRS’s definition, anybody can be a potential candidate. Other problems abound: The IRS is disregarding the Paperwork Reduction Act, not complying with FOIA, and has deliberately tried to shorten the comment period on its rules. “They simply do not know what they are doing,” said former Federal Election Commission Chairman Bradley Smith.
Smith was one of four panelists who discussed the many problems with the proposed IRS rules at the Heritage Foundation on Friday, February 21:
Video of the Week: President Obama is wrong: Many studies do find school choice produces better results.
Leaving aside for a moment the fact that President Obama is wrong about what the studies show, here’s something we can’t figure out: Why do liberals think it’s any kind of argument to say vouchers “don’t make that much of a difference”? If a Chevy dealer told you buying a Ford wouldn’t be much of an improvement over Chevy, would that convince you to buy the Chevy? Would it convince you never to buy a Ford? It wouldn’t be the case that liberals use one kind of standard for judging policies they favor and a different kind of standard for judging policies they dislike, would it?
Playin’ in a travelin’ band: Where we’ll be in March:
• On March 6 – 8, we’ll be at the Gaylord National Resort and Convention Center at the National Harbor in Maryland for the Conservative Political Action Conference.
• On March 14 – 15, we’ll be in Nashua, New Hampshire for the Northeast Republican Leadership Conference.
• And, of course, on March 26 – 28, we’ll be in sunny New Orleans for The Heritage Foundation’s Resource Bank 2014.
Please come find us at The Heritage Foundation booth, where we’ll probably be giving something cool away.
Other stuff we learned this week:
• President Obama will call for an end to the era of austerity with his 2015 federal budget, reports Zachary Goldfarb. [Washington Post, February 20] Merriam Webster defines austerity as “a situation in which there is not much money and it is spent only on things that are necessary.” [Merriam-Webster.com] The President, however, appears to have a different definition of austerity: The four largest annual federal deficits as a percentage of the economy occurred in the first four years (2009-2012) of the Obama administration, notes Charles Blahous. [Mercatus, February 21]
• Non-government organizations have a history of criticizing arms sales from the United States and other democracies while ignoring arms transfers from dictatorships. It’s a history that shows how the Arms Trade Treaty will be implemented, writes Ted Bromund. [The Foundry, February 23]
• Accusations that Wisconsin Governor Scott Walker’s 2010 campaign used illegal voter purging tactics are based on an erroneous understanding both of what is illegal and how voter registrations are vetted for inaccuracies. The accusation, however, has been widely repeated by Left-leaning national publications who haven’t bothered to investigate for themselves, reports M.C. Kittle. [Watchdog.org, February 25]
• Making posters for a protest, participating in flash mobs, and capturing video of a “Slut Walk” now count as coursework in some freshman composition course, writes Mary Grabar. And no wonder, when the instructors are reading manuals such as Composition and Sustainability: Teaching for a Threatened Generation, Rhetoric of Respect, and Affirming Students’ Rights to Their Own Language. [Minding the Campus, February 23]
• Between 11 million and 17 million workers covered by small employers will see higher health insurance premiums because of ObamaCare’s insurance regulations says a new report by the Centers for Medicare and Medicaid Services. J.D. Harrison reports that CMS finds 65 percent of small employers will face higher insurance costs. [Washington Post, February 25]
• Harold Ramis, who died on Monday, co-wrote and co-starred in the most libertarian movie of all-time, writes Philip Klein. He’s referring, of course, to Ghostbusters, which shows a small entrepreneur solving a problem (paranormal activity) in spite of meddling government bureaucrats (the Environmental Protection Agency). [Washington Examiner, February 24]
• Dave Camp’s tax reform plan will add $3.4 trillion to the economy over the next decade according to estimates by the Joint Committee on Taxation. Rep. Camp writes that his plan reduces the number of tax brackets to two with a top rate of 25 percent, increases the standard deduction, simplifies credits, and eliminates special interest handouts. [Wall Street Journal, February 25]
• Students at Modesto Junior College are now free to hand out copies of the Constitution—or any other materials—without first getting permission from the college, reports the Foundation for Individual Rights in Education. The school has revised its policies that restricted the handing out of printed materials on campus by students in order to settle its lawsuit with Robert Van Tuinen. Van Tuinen had filed the lawsuit after the school had prevented him from handing out copies of the Constitution on September 17—which is Constitution Day. [Foundation for Individual Rights in Education, February 25]
• One-hundred and thirteen out of 114 Illinois cities have a severe pension underfunding problem, finds the Illinois Policy Institute. Unfunded public pension liabilities in the state grew to more than $12 billion in 2010 from $1 billion in 2000, despite property taxes skyrocketing around the state. The problem, says the Institute, is that investment returns have not materialized while state officials have legislated ever-increasing benefit levels. [Illinois Policy Institute, February 25]
• There was nothing anti-gay about Arizona’s “anti-gay” bill (SB 1062) that Gov. Jan Brewer vetoed, writes Rich Lowry. All it did was clarify that the word “person” in the state’s Religious Freedom Restoration Act—already on the books for 15 years—applies to businesses and that the law’s protections apply to private discrimination lawsuits as well as proceedings involving the government. Also, 18 states and the federal government already have such laws on the books. [Politico, February 26]
• The Department of Justice put the wrong person from the wrong division in charge of leading the investigation of the Internal Revenue Service, says Hans von Spakovsky. Instead of putting a lawyer from the Public Integrity Section of the Criminal Division in charge of the investigation, the Department gave the responsibility to a lawyer from the Civil Rights Division, which is the most politicized division in the Justice Department. What’s more, the lawyer put in charge was Barbara Bosserman, a major Obama campaign donor. [Testimony before the House Oversight Committee, February 26]
• The cost of Medicaid has grown 31,212.5 percent in 46 years, notes a new report from Sen. Tom Coburn (R-Okla.). The cost of Medicare has grown 16,750 percent in 45 years. The cost of the Department of Defense’s health care programs has grown 1,345.9 percent in 32 years. How much will ObamaCare costs grow? [Senator Tom Coburn, February 2014]
(Want more? Check out the InsiderOnline.org blog for daily links.)
• Connect with 10,000 of your conservative friends from all around the country at the Conservative Political Action Conference, which runs March 6 – 8 at the National Harbor.
• Celebrate Ronald Reagan and unwind with your old and new friends from the Conservative Political Action Conference. The Young Conservative Coalition’s annual Reaganpalooza will take place March 8 from 8 p.m. to 1 a.m. at the Look Club in Washington, D.C.
• Learn who is helping and who is hurting the political Right. The American Enterprise Institute will host a Tea Party v. Establishment debate on March 5 at 5:30 p.m.
• Learn about the classical foundations of freedom and how they apply to our culture today. The Acton Institute is now accepting registrations for its annual Acton University. Acton University is four days of courses that integrate economics, philosophy, and Judeo-Christian faith. You can create a customized learning path from over 100 courses taught by a world-class faculty. Acton University runs June 17 – 20 in Grand Rapids, Mich.
• Learn about the Great Books by registering for Hillsdale College’s online course, Great Books 101. The 11-week course will cover Homer, the Bible, the Inferno, and much more. The course begins March 3.
• Find out who some of the best leaders and thinkers are in the conservative movement. The annual Weyrich Awards will be held March 5. The reception will begin at 6 p.m. at the Four Seasons Hotel in Washington, D.C.
• Lift a glass to Margaret Thatcher at the Pacific Research Institute’s annual Baroness Thatcher Dinner. Charles Krauthammer will give the keynote address. The event will begin March 7 at 6 p.m. at the Island Hotel in Newport Beach, Calif.
• Save the date: Join leaders in the conservative movement for The Heritage Foundation’s 2014 Resource Bank Meeting, March 26 to March 28 in New Orleans. Resource Bank is a must-attend conference of today’s top conservative leaders—policy experts, think tank CEO’s, activists, and donors—filled with strategy sessions, networking, coalition building, and policy collaboration.
For more things to do, check out the InsiderOnline.org Conservative Calendar.
Have a tip for InsiderOnline? Send us an e-mail at insider@heritage.org with “For Insider” in the subject line.
Follow us on Twitter: http://twitter.com/InsiderOnline.
Looking for an expert? Visit PolicyExperts.org.
The Heritage Foundation
214 Massachusetts Avenue, NE
Washington, DC 20002-4999
phone 202.546.4400 | fax 202.546.8328
No comments: