Completely Overlooked in Health Care Bill: Supply

The Wall Street Journal has an article today on something that should have been obvious to all when creating the health care bill, but was completely ignored by the Democrats: supply.

At the current rate of medical school completion, the US could be 150K doctors short in the next 15 years. The government plays a great role in medical education because Medicare funds most of the costs associated with medical residencies.

Common sense would say that the government, in concert with expanding the amount of those who will want access to health care, would greatly increase Medicare funding for residencies, so that medical schools could expand and more doctors could be trained to meet the demand of 30 million new medical consumers. Not only was Medicare funding for medical residents not raised, Medicare was cut by $500 billion in an accounting move to make the bill seem less of a boondoggle.

As a result, there will be a huge shortage of doctors and a looming supply problem in medical care that will require a huge fix in the years to come.

Something Never Discussed During the Health Care Debate: Supply

The House passed the Senate Health Care plan, as well as a series of Reconciliation measures designed to force those without health insurance to buy it (or face a penalty), as well as taxing upper income taxpayers to subsidize insurance for those who make under $88,000/year.

Regardless of whether you agree with this or not, and I clearly do not, there is one question that no one seems to be asking. Let's assume there are 45 million or so people in the U.S. who do not consume health care because they do not have insurance. This bill will insure almost all of them, so assume there will be at least 40 million new health care consumers in the U.S. in five years. Even with the influx of money that could be spent from the insurance premiums and payments by insurers to health care providers, who will be treating these patients?

As far as I can tell from cursory glances at the legislation and more in-depth study of the news reports on it, there is nothing in the legislation to support the creation of new medical schools. How will you increase the consumer base of medical care in the U.S. by 20% or more without any increase in the number of medical doctors, nurses, and other health care workers? How will the system handle all the new demand for services? Doctors are incredibly overworked as it is.

Money can build hospitals and buy equipment, but medical schools are the only way to tilt the balance of supply and demand. If the supply cannot keep up with the new artificially-inflated demand, the supply is going to get more expensive no matter what the government does. If the government was serious about cutting the costs of health care, it would provide incentives to universities to create medical schools and hospitals to create residency programs. After a few years with larger classes of new doctors, there would be more supply to meet the new demand for services, and costs would stabilize or go down.

That is how you solve a health care problem. Forcing millions more people into a health care system that operates at or near capacity on a regular basis is not going to solve any problem. Giving people insurance that they cannot use because the system is flooded with patients who cannot be seen is a disaster waiting to happen.

Just What the IRS Does Not Need, More Power

Under Obamacare, what will happen to your tax refund if you refuse to get health insurance?

The IRS may keep it and apply it to any penalty that the government decides to impose on those without health insurance. The IRS will be able to confiscate it under the House Health Care proposal. Of course, those who lack health insurance and are paying the penalty are likely not paying the penalty because they choose not to have coverage; they likely cannot afford it. Taking their tax refund is a horrible way to help people who need that money. After all, they overpaid the government in the first place!

Since the IRS will be given new powers of confiscation, they need $10 billion from the government over 10 years to separate tax refunds from hard-working people who need it. Oh, and another 17,000 employees to deal with all the new responsibility Obamacare would give them.

This scenario is likely just going to be compounded with all the new orders given to existing branches of government. Each department is going to need money above and beyond what the health care bill costs in order to implement it, as well as tens of thousands of employees, all at above market wages and union representation. So while the Democrats say health care is only going to cost so much, they clearly either ignore or discount the true cost of implementing this disgrace of a bill.

Anthem Under Fire For Lack of Common Sense

Anthem Blue Cross insurance has been under fire lately. The White House wants Anthem to explains its premium increases, and has been hit by a jury in California for refusing to pay for a liver transplant.

Ephram Nehme was approved by Anthem for a liver transplant in California, but his doctor told him to go to Indiana for a shorter wait. He did so, and Anthem refused to cover the transplant in Indiana, citing its contract with Nehme that stated all transplants had to take place in California. Nehme paid for the surgery himself, then sued Anthem and received the cost of his transplant and attorneys' fees.

While Anthem could be seen as proper for sticking to its contract language, contract language such as this is why people hate insurance companies, and why Democrats think people will support their reforms. Consumers don't understand contract language like this, and don't understand why an insurance company can approve transplants in one state but not another. It was not as if Nehme wanted to have his transplant done in Zimbabwe, he wanted it done in Indiana, another state in which Anthem sells insurance! Anthem could clearly determine whether a provider in Indiana meets its standards for payment. So while Anthem will say that Nehme, and others with Anthem insurance in California, can't leave California for transplants, consumers will only get angry with insurance companies, and become putty for the Democrats.

Insurance companies need to pick and choose their battles with consumers. Hiding behind contract language is going to get Obama's Single Payer System, and insurance companies (as well as Americans) will be the big losers there.

Collective Bargaining Agreements and the NBA

I like sports, a lot. All sports, from football to cricket. I was in New York City this past weekend on a rainy Saturday taking a nap while watching the Six Nations Rugby Championship on BBC America.

However, if you follow sports, the constant conflicts between the team owners and the player unions are always in the news. The NHL lost a season to a labor dispute in the early 2000's, and the NFL and NBA are potentially facing lockouts or strikes after the 2010 or 2011 seasons. The disagreements between the two groups is all about the Collective Bargaining Agreement, or the rules pertaining to signing players and offering contracts in each league.

The Collective Bargaining Agreements themselves are quite interesting reads for an attorney, or a sports geek. It is interesting to see the things negotiated on behalf of the players.

For instance, if you ever found yourself thinking how players deal with getting traded mid-season, the Collective Bargaining Agreement (CBA) in the NBA answers this. Players get hotel accommodation for up to 45 days, rent reimbursement of up to $4500/month for three months, and all reasonable moving expenses paid. Not a bad deal. Do NBA players have to pay for their own meals on the road? Not at all. They get $102/day meal money in 2005 dollars, adjusted for inflation using the CPI. That buys a lot of room service.

The NBA CBA also covers the completely mundane as well. The NBA Players Association also has the right to inspect any facility used by the NBA to conduct practices or games and can get a grievance heard within 24 hours. If players get the right to be given tickets, senior players have to be given better seat locations. Players with more than three years in the NBA have the right to buy two tickets to every game. And also, each NBA team agrees not to hold any player responsible for an injury in a fight to another player.

Also, if you're an NBA played demoted to the NBDL (see Thabeet, Hasheem), you are entitled to fly first class and not have a roommate in a hotel room, and you still get your $102+/day per diem. Not a bad deal at all, especially when considering all the other players will be jealous and angry with you for not having to suffer as they do.

All and all, for sports geeks interested with the rules of what perks players get, what sort of accommodation they are entitled to, and just the minutiae that needs to be negotiated for there not to be a lockout or a strike. It's not just about player contract size or length, it's how much meal money or how many tickets each player gets as well.

Sean David Moron vs. the SEC

The Securities and Exchange Commission is going after Sean David Morton, for allegedly collecting $6 million in money from investors in his "psychic" investment fund. Morton claimed his "psychic" powers could be used to substantial profit in the foreign currency trading markets. Morton collected $6 million from investors, but allegedly only placed $3+ million in trading accounts and used the rest of it for his "non-profit" and personal purposes.

The SEC has accused Morton of violating many sections of the Securities Act and Exchange Act, including Rule 10b-5. In the complaint, the SEC points out many false statements by Morton and numerous stories of Morton (allegedly) lying to induce investors to hand over money to him. Morton also allegedly failed to complete any SEC requirement in relation to registering his investment companies, and a statement he made to Coast to Coast AM appears to show that Morton did not think he was responsible for registering.

The SEC generally does not go after people it does not have an air-tight case against, with the notable exception of Mark Cuban. Additionally, Morton does not have the best litigation track record, particularly when you consider he calls himself "Americas' Psychic". UFOWatchdog.com exposed Morton repeatedly, pointing out every contradiction and fallacy that Morton stated about himself. Morton eventually sued the author of UFOWatchdog.com for defamation, but was found to have violated the Anti-SLAPP statute in California and ordered to pay legal fees of approximately $16K.

Morton also apparently sued the SEC in 2009 while the SEC was investigating him, claiming that the SEC was going after him solely to take taxpayer-paid trips to Disneyland and In-N-Out Burger. While noble goals of the SEC if they were true, the lawsuit was dismissed in December 2009.

Of course, Morton's psychic powers in dealing with the legal system and the SEC are comparable to his past predictions. Click the link to see some of the "psychic visions" of Morton, and you'll see that his only success is suckering people out of money. Hopefully the SEC puts Morton into a position where he cannot play PT Barnum anymore.

Leveling the Playing Field in Debt Collection Lawsuits

This past Wednesday I spent two hours being trained on how to assist pro se defendants who are being sued for allegedly not paying consumer debt. It was an interesting and enlightening session that gives an idea of the odds pro se defendants are up against in small claims and district courts.

The Volunteer Lawyers Project of the Boston Bar Association is doing great work in attempting to educate pro se defendants in consumer debt cases, and is attempting to soon be able to act as attorneys-for-a-day to these pro se defendants so that they need not have to go through it alone.

While uneven levels of representation exist in the judicial system, few levels of relative representation are as unequal as debt collectors vs pro se defendants. If a pro se defendant misses a hearing date, a default judgment is almost always entered for the debt collector, whereas if the attorney for the debt collector does not appear, the judge will get another attorney to appear for the debt collector and will allow the prosecution of the case to continue despite the appearing attorney's lack of information.

The Boston Globe Spotlight Series did a series of articles on the inequality rampant in Small Claims Court against defendants, particularly pro se defendants. Judges were complicit in the inequality, going much harder on pro se defendants than they ever did on debt collector attorneys. The Spotlight series highlighted that debt collectors got continuances when none should have been granted, that debt collectors lied on complaints and many other abuses. The SJC, starting in October 2009, required Small Claims Courts to, among other things, have Clerk-Magistrates review settlement arrangements and required debt collectors to provide some evidence of debt to obtain a judgment. These requirements are unremarkable and were already encompassed in the previous rules, but had to be specified because of the abuses of the debt collectors.

Despite what the SJC has enacted, the need for pro se assistance is still great and the playing field between pro se defendant and debt collectors is still unequal. Hopefully I am able to provide some assistance to those are in need. While many of the pro se defendants may owe the amounts being sued over, they still are entitled to have court procedures followed and to be treated with respect. The Volunteer Lawyers Project is starting to turn the tide against debt collectors having the run of District and Small Claims Courts.

Tax Dodgers Are Blind

You need to be a bit creative to honestly deny the ability of the US Government to impose an income tax, considering it was implemented during the Civil War and enacted as an amendment to the Constitution. Tax deniers claim that the 16th Amendment was improperly enacted by some of the states, so it never really was legal. They claim it violates freedom of speech (by requiring you to report income) and taking of property without due process, among other spurious arguments.

Joseph Stack was not so much a tax denier as much as a tax protester, but his suicide letter made many references to the idea that the income tax was unconstitutional.

However, Peter Pappas, a Florida tax attorney and author of The Tax Lawyer's Blog, has gone through Stack's suicide letter and refuted every inaccuracy stated. Among his points:

Stack:

We carefully studied the law (with the help of some of the “best”, high-paid, experienced tax lawyers in the business), and then began to do exactly what the “big boys” were doing (except that we weren’t steeling (sic) from our congregation or lying to the government about our massive profits in the name of God).

Pappas:

Again, Stack is upset that he couldn’t get away with what he alleges the Catholic Church got away with: Namely, tax fraud.

All in all, Pappas makes Stack's IRS diatribe look incredibly foolish and makes Stack look like a selfish person who just did not follow tax laws very well. While Stack's letter makes him on the surface to be harassed by the IRS, Pappas shows that most of what Stack said is pure smoke, and he was a rebel without a clue.

Need $50K? Flip Off a Cop

Getting arrested for flipping the middle finger at a police officer is apparently quite the profitable endeavor.

David Hackbart did such a thing at another motorist, and then a police officer in Pittsburgh. After flipping off the motorist, the police officer warned Hackbart not to do it. Hackbart then had the reasonable response of flipping the police officer off for telling him not to flip the motorist off. The police officer then arrested Hackbart for disorderly conduct, despite the act of flipping someone off being protected First Amendment speech and not obscene. In other words, even in the catch-all unconstitutionalness of most disorderly conduct statutes, flipping the bird is not included.

So Hackbart did the normal American thing; he sued the Pittsburgh Police under 42 U.S.C. 1983, citing violations of his First, Fourth and Fourteenth Amendment rights. Hackbart won at summary judgment against the police officer, with the judge finding that Hackbart was clearly pulled over because he flipped off the police officer in a retaliatory measure. Pittsburgh, realizing it was facing a substantial judgment, then settled the case for $50,000 and agreeing to inform police officers on the need not to pull motorists over for flipping them off.

So if you're driving in Pittsburgh, use your middle finger at will, and maybe you can be $50,000 richer.

Thanks to On Point News for the article and scanning the briefs.

Great Video of North Korea

(I just like this photo very much)

CNN had a link to a story done by an internet media outfit called VBS.TV. It is a 14 part series on VBS.TV's trip into North Korea, including what they saw while they were there, the trouble they had getting in, and the surrealness of it all.

Particularly interesting are the visits to the Arirang Mass Games, where the reporter is one of 15 spectators with 100K Koreans participating, and the reporters' trip to the DMZ from both sides of the North-South Divide. The Southern side is much stricter with rules (like no pointing at anyone in the North) and checkpoints, and the Northern side uses the opportunity to taunt the South. Very interesting also is the extent to which the North Koreans go to try and give the impression of abundance to the reporters.

I've always been intrigued about North Korea. It is such an unknown place, where time seems to have forgotten all about it. Watching the video, it's staggering to see how much in the past the DPRK is. In the largest library in North Korea, the DPRK Guide is talking with pride about the library having Mariah Carey and the Beatles on a cassette tape.

Of course, when you consider what North Korea looks like to the universe after dark (the picture, obviously), it is easy to see how it could be so backwards.

If you have an hour to kill and are as intrigued about North Korea as I am, I suggest watching the 14 part series from VBS.TV.

Parts 1-3 are on CNN's website in this story. Click on the video.

Part 4 starts here on the VBS.TV website.

UMass Law Approved

The Mass Board of Education approved a UMass Law School. Apparently a $75,000 debt load at graduation will motivate lawyers to go into public service in a way that a $100,000 debt load will not.

The UMass system will regret it when the law school steals public funds from the rest of the university system after the law school goes on a politician hiring binge. It will cost tens of millions of dollars to recruit students to an unaccredited law school, where the whole hope is that tuition dollars from a larger student body will allow the school to increase facilities to the barest requirements the ABA has. But how will the rising student body deal with the substandard facilities currently in place?

Ten years from now, when Massachusetts inevitably faces another budget crisis, does anyone think the legislature will resist the urge to dramatically raise tuition for the UMass Law School, just as California has responded to its near-bankruptcy by making the U. Cal law schools among the highest tuition in the country and insanely high for out-of-state students.

But hey, a public law school and lots of jobs for former state reps made buying this unaccredited law school worth it, right?

The IRS Hates Air Travelers

The airline industry just got emboldened by the IRS last week. The IRS has decided that checked baggage fees are not taxable under federal air travel excise tax because of an exclusion that says fees for baggage transportation are not taxable. Of course, the IRS neglected to state, or just forgot, that prior to airlines charging checked baggage fees, the cost of baggage was incorporated in the fare, which was subject to excise tax.

This literal interpretation of the IRS Code could embolden the airlines to further unbundle the components of their airfare and charge for them separately, knowing they will not need to share the revenue with the government. Air travelers will be much less sensitive paying a rounded fee, such as $25, versus having to pay $25 plus the excise tax.

With the airlines not needing to worry about excise tax, they can unbundle other parts of the fare that were once subject to the excise tax. Eventually, airlines can charge a nominal fare, such as $10, and have separate specific charges for everything else, such as fuel, a seat, baggage, drinks, etc. Only the $10 fare will be subject to the excise tax, and the airline can keep all the other revenue for itself. For those who think this is unlikely, look at Ryanair, the deeply-discounted airline in Ireland. They do exactly this.

Normally I hate taxes and think companies should do everything in their power to avoid them. However, the airline industry is different. The airline industry relies on many different layers of government, local governments that apply fees on tickets to pay for airport renovations and the federal government for security (not the TSA, but other security), air traffic control and other administrative assistance. Most other industries can repay this government assistance through other means, like corporate taxes on profits or personal taxes through dividends, but the airline industry is almost always unprofitable and certainly does not give dividends to shareholders. Excise taxes are almost the only way the airline industry pays for the infrastructure that it uses.

Unbundling could undo the airline industry's only contribution to the government that subsidizes it so much. The IRS should have imposed the excise tax on baggage fees, telling the industry that it should rightly be considered part of the fare. Even if the IRS Code excludes the cost of transporting baggage, that was intended to apply solely to bags flying independent of passengers. Applying the rule literally will hurt the traveling public.

Shocker: Distracted Driver Laws Fail

Sorry about the sarcasm, but to no real surprise, all of these laws that ban hand-held use of mobile phones do not have the intended legal effect. An insurance group, the Highway Loss Data Institute, examined data from states like Connecticut, California and New York to examine accident frequency before and after these states enacted laws banning hand-held use of mobile phones while operating a vehicle.

Why do these statutes fail? Because mobile phones are one of many ways drivers are distracted, with such ancient distractions such as the radio, the instruments and passengers outside of the imagination of legislators in deciding what to ban while driving an automobile. The states that have passed these laws find that people start using hands-free devices to talk, leaving them just as distracted before, but apparently with one more crucial free hand.

The study authors are apparently perplexed by this, saying the study "raises as many questions as it answers." However, it is not perplexing at all. While everyone has driven along a road next to someone texting/typing and erratically driving as a result. However, this is not a new occurrence with the mobile phone. Before mobile phones, there were women applying makeup, people in heated arguments, attempting to adjust the analog dial on an AM radio... the list goes on and on. When I was 16, I was rear-ended by a distracted woman who was rifling through her purse at 45 mph. Should they ban purses and other bags from the passenger compartment of autos because women were distracted? Obviously, that argument would be viewed as absurd.

Why then ban mobile phones when 99.9% of drivers are able to maturely use a phone while driving? Is there a mighty Jupiter Jack lobby, or is Motorola secretly conspiring with the government to enact these laws to pump up sales of Bluetooth headsets?

Distracted driver laws are simply the only way governments know how to handle things: in a reactionary and misguided way.

Even Progressives Hope Coakley Loses - And They Should

Martha Coakley, the mediocre Attorney General turned US Senate candidate, has caused quite an impression on the political world. She has made gaffe after gaffe after gaffe, claiming Curt Schilling is a Yankee fan and that shaking hands of voters at Fenway Park for the Winter Classic is pointless.

Progressives are now starting to make the argument that even the most ardent left wing Democrats should not be voting for her, in an attempt to purify the party and force them to nominate candidates that appeal to the left wing.

For liberals and Democrats, abstaining or voting against Coakley is an interesting option. If Martha Coakley wins on Tuesday, she will likely never face a primary challenger again for as long as she chooses to serve in the Senate. This conceivably means that Coakley could be scot-free for 30 or 40 years (See Kennedy, E. and Byrd, R.), never facing a challenge from another Democrat and potentially never seeing a strong Republican challenger.

But Coakley is a disaster of a candidate. By all standards of measurement, Coakley has been an absolute disaster, so much so that even if Coakley wins, she will be seen as a failure of a politician. If Democrats abstain or vote for Scott Brown, they can think to themselves that the Democratic Party can nominate a stronger challenger to then Senator Brown in 2012. In other words, the Democrats would be able to trade 2+ years of Scott Brown in the Senate for the ability to nominate a non-disaster of a Senate candidate.

The Democrats could have solved all of this by not just voting for the token woman in the December primary. However, they are Democrats, and are more than happy to vote for labels above other things, such as ideas and qualifications. The best way for Democrats to fix their mistake is to vote for Scott Brown on Tuesday and hope they do not nominate another loser in 2012.

By then, Coakley will safely be sent off to be the dog catcher in North Adams, or another similarly useless position fitting of the worst Democratic candidate for US Senate in quite a long time.

Scott Brown Gets It

The "Teddy Kennedy" seat in the Senate is wrong, as wrong as most voters in Massachusetts are, the seat still belongs to the people of Massachusetts, not Coakley or Kennedy.

This is not the Deep South in the early 20th Century, where the real election was the Democratic primary.

Scott Brown can conceivably win this race. Massachusetts can stand for America.

Scott Brown Day

Scott Brown, the Republican candidate for Senate in Massachusetts, has had quite a day today.

First off, he raised over a million dollars today. As of 11:30PM, he has raised $1,117,747 today. Outside of Mitt Romney, can you imagine a Republican from Massachusetts raising anywhere near that much money in a week, nevermind a day? The money may be mainly coming from outside of Massachusetts, but it will pay for numerous commercials until the election next Tuesday.

Secondly, he took Martha Coakley to the cleaners tonight. Not just my opinion as well. Commentators like Andy Hiller from Channel 7 and Joe Battenfeld of Channel 25 say he ran away from the debate. Coakley is a horrible debater, lacking when she needs to move off the script her handlers give her. Scott Brown showed enthusiasm, knowledge and spark, and also showed that he was not a typical GOP guy, which clearly helps in Massachusetts.

There might be a real race in the next week or so. Ignoring the predictable Globe poll on Sunday that showed Coakley up 15% (despite the fact that the day it went to press it was 4 days old, and the sample size was too small collected over a too long period of time.... but polling issues are for another day), there is another poll that shows Brown ahead, within the margin of error, 48%-47%. Coakley has turned out to be a horrible candidate for the Dems, and even if she wins, she is damaged goods.

Go Scott Brown!

Could Massachusetts Elect a Republican Senator?

A recent poll for the special U.S. Senate election on January 19 has Scott Brown down 50-41 among "likely voters" and Brown only down 2 percent among respondents who stated they would definitely vote.

Considering that in Massachusetts the Democrats have always won every statewide position (except Governor until 2006), usually by large margins, this poll must be a gut punch to the Democrats. For Senate races, the Democrat usually wins by approximately 65-70% to 30-35% (even a well-funded Mitt Romney only got 41% as a Senate candidate).

Why is Scott Brown doing so well? Well, a sinister idea is furthered by Ben Smith of Politico, that the Democrats nationally are rooting and hoping for a close race so that the Democrats can win and state that the Republican momentum is a myth. It is an idea with some supporting evidence behind it. The Boston Globe, normally the mouthpiece of the Democratic party in Massachusetts, has published articles critical of Coakley, stating that she went easy on a defendant in a 2005 case and was a poor performer before the US Supreme Court in a case Coakley lost that has made prosecution crime labs overburdened. Could the Globe be purposely trying to put the race closer on the idea that there is no way Massachusetts will elect a GOP man?

Here's hoping, if the Democrats are purposely trying to make the race closer, they overdo it and cause Coakley to lose. Coakley is a horrible candidate, and only won the primary because she was the only female. She is an awful speaker, unable to expand on anything beyond force-fed talking points, and clearly will be nothing more than an empty Democratic vote. Massachusetts could make Scott Brown a very dependable independent Senator, toning down his more right-wing views for the purpose of reelection.

Win or lose, at least the campaign commercials have gone way down since the primary ended.