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Generational Dynamics Web Log for 26-Apr-2016
26-Apr-16 World View -- Obamacare continues death spiral as Britain's NHS faces strike

Web Log - April, 2016

26-Apr-16 World View -- Obamacare continues death spiral as Britain's NHS faces strike

Obama administration tries to find money to save Obamacare

This morning's key headlines from

Britain's NHS facing massive strike from 'junior doctors'

Striking protesters carry signs saying 'Destroy the patriarchy, not the NHS' and 'Victory to the junior doctors' (Press Association)
Striking protesters carry signs saying 'Destroy the patriarchy, not the NHS' and 'Victory to the junior doctors' (Press Association)

As we've been reporting since October, Britain's National Health Service (NHS) is facing an existential crisis, with a huge and accelerating deficit expected to reach 22 billion pounds ($32 billion) by 2020. ( "5-Aug-15 World View -- Britain's National Health Service (NHS) faces existential financial crisis")

Now the NHS is facing a massive strike from "junior doctors," after Health Secretary Jeremy Hunt has said he's unwilling to compromise on a contract that would increase working hours. Junior doctors, the backbone of the NHS, whose workday now ends at 7 pm, would have the workday extended to 10 pm. Also, for the first time, their normal working week would include Saturday from 7am to 5pm. The strike is scheduled to last 48 hours, on Tuesday and Wednesday.

The system is deeply corrupt, with doctors falsifying records, claiming for work that was never done, or putting in for bogus overtime. Dentistry services are so bad that people are buying "do-it-yourself (DIY) dentistry kits" to take care of their whole families, as was done centuries ago.

Because the NHS bureaucracy is so old and bloated, and because the services are "free," costs can only be controlled by rationing, queuing, reduced quality and artificial cost suppression. UK's doctors earn far less than doctors in other countries, and UK specialists earn about half of what they do in America. As a result, UK's homegrown doctors have left to work in other countries, and NHS has had to import 28% of its doctors from abroad, usually from poorer countries where low UK salaries look attractive.

The junior doctors are demonstrating against the contract for the obvious reasons -- low pay, exhaustion, having little free time to spend with their families. A substantial number are considering leaving Britain to practice medicine in other countries, according to a poll.

However, women's groups are particularly concerned because of the disproportionate impact that the contract will have on women. Men are used to working long hours, but women often have to go home on time to take care of the children. An analysis by the Department of Health agrees that the new contract "impacts disproportionately on women." When the new contract going into effect in August, many women will be forced to quit unless they can find adequate child care, and child care services are extremely expensive.

The far left British Medical Association, which is leading the strike action, has launched a judicial review of the legality of the contract, because it adversely affects women.

However, the Department of Health says that women should stop complaining, because the new contract levels the playing field between men and women, which is what feminists want. According to a Department of Health spokeswoman:

"This contract is a huge step forward for achieving fairness for all trainee doctors. For the first time, junior doctors will be paid and rewarded solely on the basis of their own hard work and achievement. That is ultimately what employers and the BMA [British Medical Association] themselves want and everyone deserves: a level playing field."

Guardian (London) and BBC and Guardian and Daily Mail (London)

Britain's NHS financial crisis is being tied to the 'Brexit' debate

The "Brexit" debate, and the June 23 referendum to decide whether Britain will exit from the European Union, is being tied politically to the NHS financial crisis and the strike by junior doctors.

There are two sides to the story. One side says that if Britain leaves the European Union, then it would help the NHS financially. They argue that leaving the EU would mean that Britain could shut the door to migrants from other European countries, especially Hungary and other east European countries, who come to the UK to receive free medical services. In addition, they say that 50 million pounds per day is being sent to Brussels, and that money could be kept at home to pour into the NHS.

The other side says that if Britain leaves the European Union, then it would hurt the NHS financially. They say that health tourism -- where people travel to the UK to get free medical help -- costs less than 0.1% of the NHS budget. They point out that Norway and Switzerland, who are not in the EU, still must pay similar amounts to fund their cumbersome arrangements with the EU market. Telegraph (London) and BBC and Independent (London)

Obama administration tries to find money to save Obamacare

On the afternoon of October 1, 2013, President Obama stood up at a press conference to launch Obamacare. When a reporter asked why so few people could log on, he answered that millions of people were enrolling for insurance, so the web sites were slow. As it turned out, only six people across the country were able to enroll on that day. How is it possible that Obama and the entire White House were so completely blindsided by the disaster that was already unfolding that they didn't even know what was going on hours after the launch had begun? How many people had to lie? How many people had to commit fraud? How many people had to be silenced or fired? How many layers of management were lied to, to prevent Obama from knowing the size of the disaster, hours after the disaster was already in progress?

To answer these questions, I spent months interviewing a number of people, including contractors, whistleblowers, analysts, and others, and I posted the article " -- The greatest software development disaster in history". The reason that was a disaster was that each of the web sites was a $10-20 million software development project, but the Obama administration funded each web site with something like $200 million. So when a company like CGI Corp. receives $200 million for a $10 million project, the objective is to spend the money. So they hired hundreds of programmers, most of whom were completely incompetent. So they spent the money, but couldn't develop the web site.

As part of that project, I also looked into all the other components of Obamacare -- the exchanges, the co-ops, and the risk corridors. And as I described in the article, all of them were financial disasters. Many have gone bankrupt, and others are staying afloat only because the Obama administration is finding ways to take money from other projects and pour it into the Obamacare black hole.

The Obama administration started by taking a $730 billion Medicare fund and using it to fund Obamacare. Millions of people have been paying for years into the system to create that fund, and Obama threw it into the toilet. The co-ops and exchanges had operated at big losses, thinking that the administration would bail them out, but Congress blocked the administration from taking money from a number of other projects.

The administration is looking for more ways to bail out Obamacare co-ops and exchanges, and reports indicate that they're now planning to use a "reinsurance" mechanism in the enabling legislation that permit Obama to take money from some insurers and give it to others. Using that mechanism is supposed to be illegal, but that hasn't stopped the Obama administration before.

UnitedHealth Group Inc., the country's largest health insurer, has announced that that they are losing so much money on Obamacare exchanges that they will leave the exchanges in at least 22 states where the company sold plans for this year. Not all states have been named, but they include Florida, Kansas, Texas, North Carolina and Maryland.

There are 27 million people still uninsured, even though the administration claims that 22 million more people have insurance now than before Obamacare, but that claim is fraudulent. Millions more are effectively uninsured either because they're on Medicaid and can't find a doctor that accepts Medicaid or they're on an Obamacare plan with a deductible of $5,000 to $15,000, and have to pay their own medical expenses anyway, in addition to the premiums.

Blue Cross Blue Shield has done an in-depth study of medical claims in 2014 and 2015, and found that members who newly enrolled in BCBS individual health plans in 2014 and 2015 have higher rates of certain diseases such as hypertension, diabetes, depression, coronary artery disease, human immunodeficiency virus (HIV) and Hepatitis C than individuals who had BCBS individual coverage prior to health care reform.

For example, new enrollees have rates of HIV and Hepatitis C of 41 and 24 per 10,000 respectively, compared to 12 and 10 respectively among those with individual policies prior to Obamacare. Rates of HIV and Hepatitis C for those who receive insurance through their employers were 11 per 10,000 for both conditions.

These figures support the view that many people enroll in Obamacare when they get sick, and then drop out when they get well. Few people see any point in making premium payments if they're going to be effectively uninsured.

A new report by the nonpartisan Congressional Budget Office indicates that Obamacare costs are 10% higher than the CBO predicted a year ago. What Obamacare and Britain's NHS have in common is that both of them are in financial death spirals that cannot be sustained. Chicago Tribune and Blue Cross Blue Shield and The Beacon and The Hill and AP

(Comments: For reader comments, questions and discussion, see the 26-Apr-16 World View -- Obamacare continues death spiral as Britain's NHS faces strike thread of the Generational Dynamics forum. Comments may be posted anonymously.) (26-Apr-2016) Permanent Link
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