2017 Fourth Quarter in Review
During 2016 we:
- Created an alternative to Obamacare that has been introduced in the House and the Senate.
- Used state-of-the-art modeling to estimate that Donald Trump’s corporate tax reform would add $4,000 a year to the take-home pay of the average family – a finding used by Trump advisors during the election.
- Used peer-reviewed analysis by a former Social Security Trustee to show that if young people could opt out of the system with private savings accounts, everyone would gain – the young, the old, taxpayers and beneficiaries.
- Showed that if income and wealth are measured correctly there is half as much inequality as is being reported.
- Produced a soon-to-be-published book showing how all our social insurance programs could better meet people’s needs if they were converted to private systems, with market competition and individual ownership and control.
Advising the Trump Administration
We expect to work closely with the Trump administration. Goodman Institute board member John Ridings Lee is a member of Donald Trump’s “kitchen cabinet” and has been advising the president-elect on health policy. Our close friend Brint Ryan is a tax advisor to the administration. Another Goodman Institute board member is considering a high-level appointment under longtime collaborator Tom Price, who will head Health and Human Services.
Our good friend Andy Puzder is slated to be Secretary of Labor (a hugely important appointment), while friend and supporter Elaine Chao will be Transportation Secretary. Economic advisors Steve Moore and Larry Kudlow are longtime colleagues. Mike Pence and Kellyanne Conway are long time comrades in arms.
Thousands of Win/Win Policy Changes Are Being Ignored by Politicians
Imagine a government spending program that could be altered in a way that lowers the cost to the taxpayers and at the same time improves services for the beneficiaries. The change would literally make everyone better off. Such opportunities are neither rare nor unusual according to a report written by Goodman Institute president John Goodman and published by the Independent Institute. The report was presented to the Mont Pelerin Society in September.
As an example, Goodman points to the Veterans Administration policy on prescription drugs. Veterans who tire of waiting for an appointment with VA doctors often go to private doctors to get prescriptions. But before they can get the prescription filled at the VA (where the prices are much lower) they must get a second prescription from a VA doctor.
“Veterans are the only people in our society who must get two prescriptions in order to get access to discounts on drugs,” says Goodman. “If we dropped that silly rule and let veterans fill private doctor prescriptions at the VA, we could lower the time cost and the money cost of veteran health care. And since we wouldn’t need as many VA doctors, we could lower the cost to the taxpayers as well.”
Goodman gives other examples of potential win/win changes in federal programs:
- Medicare should stop refusing to pay for phone and email doctor consultations, which are available from private services for a fraction of the cost of a doctor’s office visit.
- Medicaid should allow patients to add cash to the government’s reimbursement rate and gain access to walk-in clinics, where typical prices are well below the cost (to Medicaid) of a doctor visit or emergency room care.
- Medicare should start paying for Uber type doctor house calls (arrival within an hour at a cost of $100) instead of paying $500 for an emergency room visit at nights and on weekends.
Kotlikoff: The Paris Accord May Be Making Climate Change Worse
Goodman Institute Senior Fellow Laurence Kotlikoff and his colleagues have an unfortunate discovery for advocates of green energy: the 2015 Paris Accord put “dirty energy” producers on notice that their days are numbered. Unfortunately, this “use it or lose it” message may have accelerated the extraction and sale of fossil fuels, thereby, permanently worsening climate change. The paper notes that since 2010, global oil production has risen by 10 percent, global coal production by 9 percent, and global natural gas production by 11 percent.
Saving and Rettenmaier: Health Care Spending Is Revving Up Again
Despite promises of Obamacare, health care spending is once again growing faster than the economy according to an analysis by Goodman Institute scholars Thomas Saving and Andrew Rettenmaier. More than one in five consumer dollars now goes to health care. The Centers for Medicare and Medicaid Services (CMS) has two forecasts of Medicare spending: one that assumes Obamacare policies will be successful in holding Medicare spending to the rate of the growth of the economy; the other assumes those policies will fail. The authors say the latter is more likely unless we have market-based reforms.
Goodman to Fox News and USA Today: Republicans May Not Be Able to Replace Obamacare
In a series of interviews with Fox News and USA Today and in editorials at Forbes, John Goodman says a replacement for Obamacare faces huge political constraints. For example, most members of Congress — whether Republican or Democrat — will not vote for a plan that takes health insurance away from 23 million people. That means those who have been insured by Obamacare are going to have to be grandfathered to some degree, so they can keep the insurance they now have. Only one Republican proposal actually does this.
Goodman Institute Solution to Obamacare is in the CURES Act
The CURES Act, which passed with huge bipartisan majorities in both houses of Congress, was mainly focused on giving patients access to life saving drugs and medical devices in the future. But it will have an immediate impact on small business. In fact, it does 60% to 70% of everything recommended by Goodman Institute scholars as part of a replacement for Obamacare and incorporated in legislation sponsored by Rep. Pete Sessions (R-TX) and Sen. Bill Cassidy (R-LA).
Because of the CURES Act:
- Small business can now obtain portable insurance for their employees without huge fines.
- They can choose the tax regime for their employees (tax credits or the exclusion).
- They have access to a completely flexible savings account – not available to anyone else in the individual market.
- Even before the act, there was no employer mandate for these firms and if they self-insure they can have limited benefit insurance for their employees with no April 15th penalty for being uninsured.
One way to think about the Sessions/Cassidy legislation (see the next item) is to see that it will extend these same features to the rest of the health care system.
Goodman Briefs Doctors on Capitol Hill
John Goodman briefed the National Physicians Council for Health Care Policy on Capitol Hill in November. In attendance were House Rules Committee Chairman Pete Sessions; the new chair of Energy and Commerce, Greg Walden; and other members of Congress.
The message: We have an excellent plan to fulfill Donald Trump’s goal of repealing and replacing Obamacare – legislation introduced by Rep. Pete session (R-TX) and Sen. Bill Cassidy (R-LA).
Defeating Single Payer Health Insurance in Colorado
Linda Gorman almost single-handedly provided the intellectual ammunition that helped defeat Colorado Care by a 4 to 1 vote in November. Had this single-payer initiative succeeded, similar measures would have appeared on the ballot in dozens of other states.
In a report for the Goodman Institute, Gorman showed that Colorado Care would have imposed very high tax rates on senior citizens, even though they would get almost no benefits from the measure.
New Book: Privatizing the Social Insurance State
The Independent Institute plans to publish John Goodman’s new book on social insurance, showing how we can convert Social Security, Medicare, long-term care under Medicaid, Disability Insurance, Survivor’s Insurance, unemployment insurance, and workers’ compensation into private programs that better meet individual and family needs. This academic tour de force was summarized in a paper he presented to the Mont Pelerin Society in September.
We Have a New Board Member
At our board of directors meeting in Dallas on November 4, 2016, a new board member was elected to join our current board members: John C. Goodman, Chairman Leigh S. Curry, J. Coley Clark, William P. Hallman, Jr., Nan Hayworth, R. Shane Jackson and John Ridings Lee. The new board member is John Bardis.
John Bardis founded MedAssets in 1999, a $750 million leading healthcare performance improvement company in the United States. MedAssets was acquired by Pamplona Capital in January, 2016 in a transaction valued at 2.75 billion dollars. Mr. Bardis continues to serve as a consultant and trusted advisor within the new private ownership framework. With more than 30 years of experience in the healthcare industry, Bardis has held various senior management positions. In 1995, he was named Entrepreneur of the year by INC. Magazine. For four consecutive years, in 2011, 2012, 2013 and 2014, Bardis was recognized by Modern Healthcare as one of the “Top 100 Most Influential Leaders in Healthcare.” He graduated with a bachelor’s degree in business from the University of Arizona.
Your support has made the efforts above possible, and we hope you will help us continue with this vitally important work in 2017. If you have any questions or require any additional information, please do not hesitate to contact John Goodman by phone at 202-679-9622 or via email at firstname.lastname@example.org.