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What If Obamacare Was A Fighter Jet?

2:57 pm in Uncategorized by JP Sottile

Imagine if you will … an epic government failure.

Chronic mismanagement and cost over-runs. Incomplete software coding, timely political donations and undelivered promises. And zero accountability.

Now, imagine the outrage.

No, really. You will actually have to imagine the outrage.

That’s because The Great American Outrage Machine™ has no interest in generating a scandal around the ultimate example of government failure: the F-35 fighter jet.

Like the comically bad roll-out of the Affordable Care Act’s website, the long-delayed and often-rejiggered F-35 program is a costly disaster rife with technological snafus, software problems and repeated contractor incompetence.

Unlike the circle-jerk of posturing, pontification and media preoccupation that gave us The Shutdown of 2013, the “first $1 trillion weapon system in history” has quietly metastasized into a debacle that is, to quote Sen. John McCain, “worse than a disgrace.”

And although increasingly well-compensated contractors will “surge” over the next few weeks to remediate the epic fail of a healthcare website that has ballooned from an estimated cost of $94 million to over $400 million, it pales in comparison to an “aerospace megaproject” that is seven years behind schedule and 70% over the initial budget estimate of $233 billion—all to deliver 409 fewer planes than originally planned.

Even worse, a recent report by the Pentagon’s Inspector General detailed an array of management and quality-assurance problems at Lockheed Martin’s production facility in Fort Worth, Texas, all of which contributed to over 200 repairs on each plane. Of course, each of those repairs translates into added cost to the taxpayer-funded program. Citing the report, McClatchy’s James Rosen noted that beyond the 28 “major” problems among the total of 70 found at Lockheed’s Fort Worth facility, there were another 119 “major issues at Lockheed’s five main subcontractors’ plants.”

Despite these problems, the F-35 program soldiered on through the Congressional budget process, thus far emerging both “unscathed” by budget battles and immune to the “indiscriminate” cuts imposed by The Sequester.

Perhaps not coincidentally, the IG’s report was completed at the end of 2012, but was not released until September 30th of this year—months after the House approved $600 billion of Pentagon spending and weeks after the Senate Armed Service Committee submitted its slightly less fruitful version of the defense spending bill.

And Lockheed used the long interregnum between the completion and release of the IG’s report to simply dismiss its claims as “out-of-date” and functionally irrelevant. It is true that Lockheed has trimmed the per plane cost from, according to the Project on Government Oversight, a peak of $161 million per plane to $133 million in 2012 and, if Lockheed is to be believed, downward over the next few years to somewhere between $114 million and $156 million per plane, depending on model specifications, engine options, retrofits and upgrades.

If these numbers are a bit mind-boggling, it is only the tip of a giant contracting iceberg uncovered by Adam Ciralsky in a lengthy Vanity Fair exposé of the F-35 program. It reads like anti-government porn for hot and bothered budget hawks. Here are some of the “sexier” details:

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Health Insurance Is Not Healthcare

3:58 pm in Uncategorized by JP Sottile

It's a wager

Insurance companies make a simple wager with you each time you sign a policy. They are betting that, over the life of the policy, they will pay out less to you and your beneficiaries than you will pay them.

Insurance companies of all kinds make tidy profits on this simple wager. If they don’t, sometimes the government will bail them out.

Either way, insurance is still just a bet. And in America, we do not have a healthcare system. We have a health insurance industry.

That industry has been one of the most profitable sectors of the economy for well over a decade. But costs skyrocketed and care suffered. We heard horror stories about rationed care, denied procedures and corporate bureaucracies run amok. Ironically, these were the horror stories we were supposed to hear if the government took the reigns of the “best healthcare system in the world.”

So, instead of a single-payer healthcare system, we got The Affordable Care Act—aka Obamacare. Instead of retiring the health insurance industry and its actuarial tables and profit margins and wagers, Obama “saved” the health insurance industry and enshrined it in perpetuity as the “Health Insurance-Industrial Complex.”

As the Affordable Care Act’s provisions begin to take effect, the folks in the Complex are wasting no time doing what they can to keep their profits tidy. Leading insurers in California are seeking increases in premiums ranging from 20% to 26%. Regulators in Florida and Ohio have already approved increasing premiums as much as 20%, and, since the ACA doesn’t set federal standards, insurance companies are moving in a number of states to force these spikes in premiums.

Remember, if you can “afford” health insurance, you have to buy it. If you refuse, you’ll pay a penalty to the government at tax time. Some are exempt from this mandate. But, in effect, the ACA has guaranteed the health insurance industry a captive market.

Meanwhile, they continue to change the terms of all those bets they’ve placed against millions of Americans and the cost of the “best healthcare in the world” continues to rise. When compared to other nations with some form of single-payer system, the difference is so stark that it’s almost obscene. It’s not just the $800 difference between an MRI in France versus the U.S., it’s almost every part of a system that has at its heart the relentless desire to turn a profit.

Even worse, a much-ballyhooed part of the promised “21st Century transformation” into greater “affordability” has turned out be little more than a profiteering scheme.

Remember the “streamlining” and “cost savings” guaranteed from the conversion to electronic medical records? Well, it hasn’t quite panned out. In fact, the only real beneficiaries of the conversion are companies like General Electric that sell electronic medical records systems. Not coincidentally, GE and other interested parties funded the key RAND study in 2005 that both predicted $81 billion in savings for America’s health care system and also became the driving rationale for the profitable conversion.

This type of closed system is par for the course in Washington, D.C.

Every door revolves in the nation’s only recession-proof city. Is it any surprise that the woman who wrote the Affordable Care Act is now leaving the White House for a job with health care giant Johnson & Johnson? Liz Fowler worked for Senator Max Baucus (D-MT) during the drafting of the ACA and had the primary responsibility for authoring the legislation. After its passage, she migrated to the White House to help with implementation. Seems reasonable enough. However, it is important to note where she was before joining the staff of Senator Baucus. Yup, you guessed it…she was a bigwig at WellPoint, the nation’s second leading health insurance company with nearly 54 million policyholders.

All of this makes you wonder who knew whom in the breast milk-pump industry, which is seeing a huge spike in its profits thanks to a new coverage requirement written into the ACA.

It may be too early to render judgment on a law that hasn’t yet been fully implemented, but it is not too early to determine that the profit motive might simply be incompatible with the equitable delivery of healthcare. As matter of course, businesses try to lower costs and increase revenue. That may be okay when they sell scissors or candlesticks, but it seems ill-suited to deliver labor-intensive care for those who are most vulnerable.

And as far as the health of the insurance industry, it’s a safe bet that they’ll keep coming out on top as the Affordable Care Act is fully implemented. Read the rest of this entry →