Um . . . not so fast, Brian
By D.J. McGuire | Tuesday, February 1st, 2011 | Policy
After reading Brian Kirwin’s dissection of Ben Marchi’s opposition to Bill Howell’s proposed autism insurance mandate, my thoughs alomst immediately went to Canada.
I know what you’re thinking: “Canada? Land of the single-payer system? Oh my God; he’s calling Bill Howell a socialist!!”
Breathe, people. Breathe. That wasn’t the Canada mental trigger in my mind. Instead, Kirwin and Howell reminded me of the great (if relatively young) sage of Canadian punditry: Paul Wells of Macleans, who sounded the warning against conventional wisdom with his four Rules of Politics. Number two caught my eye today:
If everyone in Ottawa knows something, it’s not true.
Down here, we’ve seen this happen repeatedly, from the “loss of Iraq” (2006), to the “tax increases are necessary for transportation” mantra (2007), to the “global warming is certain” (pick a year from 1990 to 2009), to “Afghanistan is ungovernable and unsolvable” (2010), to, well, this – and I’m not so sure about this one either.
For starters, it is, indeed, mandating insurance coverage – a cute way to hide the cost to an economy. James Miller, back when he was running for Senate in 1994 and the Clinton version of health-care nationalization was debated, had the best quip on the subject: A subsidy cost $100, but a mandate is “free”!
Kirwin’s response is to list a whole slew of current mandates and demand opponents of this mandate oppose those, too (Marchi, in the comments on Kirwin’s post, took him up on it). In effect, Kirwin is asking, “Why draw the line here on mandates?”
My response would be a little different than Marchi’s: Does anyone who asks that question ever want a line drawn? Kirwin’s argument is the typical “all-or-nothing” tactic, designed to scare reasonable people into “all.” I suspect most Virginians won’t see it that way.
Will the autism mandate be the straw that breaks the camel’s back? Probably not, but it is a straw, and the camel will weaken. At some point, we have to recognize the burden is too heavy. The present would be a good place to start (lest we forget, the first conservative opinion journal, National Review, declared its purpose “to stand athwart history, yelling ‘Stop!’” – not “reverse”).
This is especially true when we look at the particulars of this mandate (HB 2467), which leads to three specific problems that Messrs. Kirwin and Howell don’t address.
1 – Locking employees in large firms: Like just about every mandate, this applies “only” to firms with 50 or more employees. That may seem to be friendly to small business, but entrepreneurs still face the indirect cost of having to compete with the mandated insurance package for employees. Said employees would be “stuck” with the large firm, and new businesses may be lost. Taking out the cost politically doesn’t mean it goes away economically.
2 – Unfunded mandate to the localities: Hap Connors is a supervisor in my county. He and I don’t agree on much, and when he rants and raves about “unfunded mandates from Richmond,” it sounds like a cop-out for another tax increase. That said, when Richmond does download cost to the localities, it should be questionned. This bill would, in fact, mandate the coverage for local government employees, meaning that Virginia taxpayers would foot the bill. The extra coverage will also make it that much mnore harder politically to cut local spending, which is largely personnel-driven. Thus we have another unintended consequence of this mandate: higher property taxes across the Commonwealth.
3 – the Obamacare factor: This bill specifically exempts any insurance plan in Obamacare’s “exchanges” from this mandate. This does the exact opposite of what states should be doing, i.e., making it easier for insurers to escape Washington’s “embrace.” Instead, this bill will drive insurers into Obamacare.
Is Brian really saying these objections are invalid? Because I can’t.
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Former candidate for Board of Supervisors in Spotsylvania, current blogger, economics teacher, and long-rumored windbag. There are two causes closest to the heart: steering the country away from the social democratic nonsense that is sinking Europe, and convincing the rest of the "rightosphere" that the NBA really is a joy to watch.
Comments
31 Responses to "Um . . . not so fast, Brian"
Well done, D.J.
Maybe we can have some constructive answers to the questions above rather than the name calling in the pro-2467 thread?
Those are some valid objections. I’d like to hear valid responses.
…and no fair deleting comments!
…trying to find a way to post Lee Talley’s PDF on costs. That went a long ways to addressing a few of these concerns.
Great post DJ. No argument here
Shaun, great debate you have going with yourself.
…at least my principles don’t bend when socialism has something in it for me personally.
Can you say the same? Didn’t think so.
I know Autism isn’t as important an issue as, say, a County Seal…..
I rest my case.
You need to set down the keyboard and come back when your dander isn’t up. You’re not making friends this morning for your issue.
Shaun, dander? I’m laughing at you.
I’m just waiting for a way to bring up your views on illegal immigration, Mr. Principle.
Always happy to do so, and I don’t have to belittle the opposition to make a point.
I left that behind in 1st Grade. Others? Not so much…
Again, the economic arguments in favor of coverage are a far, far more superior argument. What you’re doing here? It’s just lashing out…
I have no personal dog in this fight. This is a simple fairness issue. No one has made a good argument as to why autism should treated differently than any other disease.
If it takes a mandate to get the insurance companies to do what they should be doing anyway, so be it. Nothing socialist about that – anymore than the entire concept of insurance is fundamentally socialist.
God help the commonwealth.. This blog is going downhill
Brian S. –
…and that’s the main point. AFP is arguing costs and unfunded mandates to localities.
I could argue that some of the technicalities in this bill make it a bad bill (tying it to Obamacare, for instance).
This is the whole health care/health coverage argument in microcosm. We already have a system of universal health care — what we don’t have is universal health coverage. This bill — as I read it — is designed to impose two things: (1) greater participation to defray the cost of coverage, and (2) forcing insurers to cover autism before the costs are placed upon Medicaid.
Now we can argue back and forth on the merits (and you raise a good point, Schoeneman — why isn’t autism covered like any other illness?), but what I’ve heard from Kirwin exclusively is just invective…
I’ve invited Lee Talley to do a guest post, and he will get around to it this evening. That’s probably the best way to get all sides on this. We’re not going to see that from Kirwin this AM, I don’t think.
turbo, how’s Congressman Golden?
Shaun, I reply to invective with invective.
First comment questioned honesty. Next comments used the words “idiocy,” “stupidity,” “crappy,” “invalid,” and called me a “big government liberal”.
Not surprisingly, you jump on the attack wagon but not say a word about the “invective” used by commenters.
Have a blast! My post was right on target. Marchi says the AFP opposes all these existing mandates that I listed.
Do you?
Brian, other people’s behavior does not (and should not) dictate your behavior.
This subject leaves me really mixed feeling. Two years ago I talked to a grandfather of an autistic child about why I could not support more mandates. Today I talked to a parent of an autistic child who admitted that this was just the beginning of what they wanted mandated but that this was just what they could get passed now. The parent would not commit to not coming back in the future and asking for the mandate be expanded. The parent is doing what they should be doing, wanting help in every way for their child. I would also. But how do we stop the expansion of this mandate when a parent of a seven year old comes in and says that they need just one more year of coverage. and again the next year at eight ?
The problem is that Marchi is right about mandates. We have too many now and it drives insurance costs up every year. I have yet to have anyone who talks about having insurance available across state lines tell me how they are going to have policies with differing mandates work for the dreamed of enlarged pool. We certainly don’t want the feds telling us want has to be in the policy but if we have a very large list of mandates in Virginia, don’t we risk not being able to go across state lines ?
There is a good question also about the limit on companies above 50 employees. It is the small business that grows the fastest but if we make it much more expensive to grow, will they find some way to artificially stay below 50 or just limit their growth ? I know one company no more than a few miles from me who could split their company easily in days if we have too many mandates. Do we want them to spend time trying to figure out ho to avoid mandates or go out and grow their company ?
Why can’t we have heath insurance like we do car insurance ? Why can’t I buy a policy for the risks I have and want to insure. If I don’t want to have insurance for a rental car, I am not mandated to have it. If I don’t want to have comprehensive, I am not mandated to have it.
Brian, Kenny Golden is a great American who signed up to serve his country.. again. Kenny is recertifying to fly helo’s in dangerous places to keep you safe so you will have the freedom to continue to make a disgrace of yourself when you hurl insults at him and, by default, others who volunteer to serve their country..
Keep up the good work Brian, you are helping to set a new course for Bearing Drift.. Not sure where you are heading though. I wish I understand why JR added you to BD and I question whether your articles stimulate conservative though when you post an article titled “Americans for Prosperity fails on Autism”.
I guess it was a slow blog day?
The costs associated with an additional mandate would directly influence a firms ability to enter a market, and remain competitive from both a labor standpoint and a cost standpoint. Business’ who aren’t required to abide by the mandate will still have to compete with it so that they may attract a competitive labor force, thereby driving the cost of labor higher. As a result, higher labor costs to cover higher insurance costs will drive up the cost of business and this blow will land directly into the heart of big and small business alike.
In principle, from a standpoint that will best benefit business and households alike, both Marchi and Tucker are correct about the affects of a mandate. Another mandate will drive folks to Federal Healthcare, hurt competition, raise costs, and cap small business growth.
Ben, how many 50+ employee firms enter the market at that size?
C’mon. This whole thing is a cop out. Sorry, but I’m less concerned with the possible downstream impact on business that this mandate may or may not have (when everyone plays by the same rules how is there any kind of disadvantage?) when we’re talking about a direct and serious impact on families right now.
Are we Republicans so cold hearted as to ignore a legitimate problem simply out of some kind of misguided slavish devotion to our talking points?
I hope not.
Bottom line is that other expensive, therapy focused medical and mental health issues are covered by insurance – there is no valid medical reason why autism should be treated differently. But the insurance companies want it treated differently and thus government intervention is appropriate.
Not all regulation is bad. This is one of those situations where it isn’t bad. Richmond is simply getting the insurance companies to do something they already should be doing anyway.
And everybody needs to cut Kirwin some slack.
Turbo, if you don’t like the way the blog is going, email J.R. and demand a refund.
Brian- my point resided in that small firms, those with less than 50 employees, will still have to compete with large firms. That means in order to attract a competent and competitive labor force, the market will require small firms to offer benefit packages that are similar to those offered by larger firms. The problem being that a small firm can’t afford to do so, and this will in effect drive those smaller firms out of the market and hurt competition.
If by some chance, these small firms are able to stay in the market and grow, it will be reflected in a rise in costs to the consumer.
Basic economics teaches that mandates (government intervention) drive up costs and hurt business. If business hurts, then people don’t earn a wage. The true direct and serious impact will be when a father (or mother) can’t put bread on the table because the job that used to be there is now in China, India, Brazil, or Russia.
Ben, I don’t buy that argument. There is no silver bullet that every potential employee wants in a compensation package. Not every potential employee is going to care about health insurance the same way. All of these concerns about smaller firms competing against larger firms and the potential effect on the market are all conjectural.
What isn’t conjectural is the fact that families are being forced to make stark decisions about the care of their families because of the lack of action on the part of insurance companies in covering autism like any other disease.
In a system that is already heavily regulated, the long-term costs of this kind of intervention is considerably less than the value of those services to the people who need them. It is highly unlikely that this mandate will cost even one job in the long run.
It’s a cop out argument. I’m not about to tell the family of an autistic kid that I can’t help them because it may cost someone a job thirty years from now. Can you?
Everyone should watch Mark Sickles floor speech on this bill. He makes Ben’s points perfectly. Opposition has nothing to do with lack of emotion, or not caring. It has everything to do with being principally opposed to government mandates.
I’m glad Ben has the courage to stand up on principle. I wish more of our leaders around the Commonwealth did.
William, it’s easy to stand on principles when you don’t have to look the people who are being screwed over by your principles in the eye.
Your right Brian, there is no silver bullet, there is no one type of coverage that every worker demands from his potential employer. But this isn’t a choice, this is a mandate. This mandated coverage will have costs, as much is undeniable. I am not talking about any convoluted, highly unlikely senario. What I pointed to is a guarantee, it is basic economics. Firms must compete, and higher costs drive smaller firms out of the market. This hurts competition and creates higher costs and a deadweight loss.
It is bad enough that the insurance market is so regulated by government, but adding another high cost regulation won’t help the problem, just as two wrongs won’t make a right.
Finally, I am not discussing a long term possibility, but instead an immediate affect. Do you believe that the costs of your healthcare will truly only rise 1%? Do you believe that there will be no other affects on the cost to business? That is preposterous. If this bill is passed, the additional mandate will hurt the economy immediately. A society must help underprivileged, but not through job killing government mandates.
Ben, again, I don’t buy it. If the mandate applies equally to all firms, no one is at a competitive disadvantage once they get to the point where the law applies to them. According to press reports, Bob Marshall has said that covering autism may increase premiums by $2-$4. That’s not going to break anybody.
The insurance market HAS to be regulated by the government. Without government regulation, the insurance companies would be the worst of the corporate bad actors. Again, these folks do not actually make or create anything. All they do is provide protection against possible negative outcomes and their goal is pay out as little as remotely possible when those negative outcomes are realized.
If you want to see what happens with insurance without government regulation, go read up about Chicago in the 1920s. Al Capone was an innovator in the insurance business.
If you’ve got a better way of ensuring that autism is treated no differently than any other illness, I’m all ears.
Brian, and I say this respectfully; you’re wrong. It’s not easy. Frankly, it rarely is.
Ben, it depends on your principles. One of my principles is not letting political idealism stand in the way of correcting an injustice.
In a perfect world, we’d never have to deal with these questions. But we don’t live in that world.
You’re a new father, like me. Haven’t you ever worried about what you’d do if your son had a chronic illness?
I know I have, and I know I would move heaven and earth to help him. All these parents want is for their children to be treated the same as any other kid with a chronic illness. Is that so wrong?
Brian I leave you with this test, find an economist who will agree with you. Find an economist who will publicly certify that government mandates in healthcare, or any market for that matter, is better than leaving firms to compete in an open market. I promise you, it is simple laissez-faire economics. Markets preform better without outside forces.
The most efficient method is to eliminate government intervention in healthcare. Let it be traded in an open market, and I will bet my bottom dollar that competition will prevail. If there is a market for autism coverage, firms will create a niche for the demand, and the demand will be supplied at the lowest possible cost. Firms need to be incentivized to lower their costs, and a government subsidy of the cost of healthcare, at the expense of the taxpayers, is not going to provide that incentive.
Folks,
I didn’t see one post about how to define autism. This is not cancer or diabetes. Are you all aware there has been an exponential rise in “autism” cases over the last 20 years? Is this due to an increase in “real” autism? How are you defining Real autism? If the increase is real as opposed to definitional we have a public health crisis. Autistic people are about as dysfunctional as schizophrenics. If it is definitional then we are simply reclassifying people from one category to another or including large numbers of marginally affected individuals who can function well enough in society. If it is real then urgent action is needed to identify the cause. Health Insurance would be the LEAST of our problems. If it is definitional then we need to calm down and carefully reanalyze the data. Otherwise we will encourage people to game the system. But that would fly in the face of our desire for hysteria.
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