Hey, What's the Deal with Health Reform?

Pete, a friend of mine, who is a CEO of a small company, was complaining.

“We’ve just received a notice that our health premiums are going up 20%.  I don’t think we can absorb this -- now the employees are going to have to pay more.  Health reform has been a disaster!”

I understand his concern and imagine he’s got his hands full with strategic plans, budgets and balance sheets, so there isn’t time to research health reform.

So I’ve done some research and can assure him that his increase isn’t due to the health reform law.

•            First, most of the reforms haven’t kicked in yet, they are scheduled to be phased in.  2014 is a big year where we’ll see major changes.

•           But good things are in effect – one is the provision that health insurers spend at least 80% of premium on medical costs.  I don’t know what carrier he’s dealing with, but some of the big names can do this, some are not that efficient.   They've been forced to  look hard at their administrative costs and not just pass them along to the customer.

•          Creation of ACO’s (Accountable Care Organizations) are enabled by the law.  These begin to address costs by rewarding for outcomes, not by the test.  They deliver better care at lower costs.  These are new and their effects will be greater as they grow in popularity.

So, Pete, this may not make you feel any better about that stiff increase, but don’t blame health care reform. 

It will take time,  it could be improved (hopefully it will) as we see what works best, but it is a step in the right direction of doing something about spiraling healthcare costs. 

There are many articles on this, let me know if you'd like the links. 

all the best,

Tracy

Lowering Taxes for Business

Every election, I hear someone say: "We need to lower taxes for business to create jobs, stimulate the economy, etc..."

On the surface, this seems like a really good idea.  Businesses employ people and we could use more jobs.

But would this really do any good?

I don't think so.  Businesses only pay taxes when they generate a profit (or in the case of some large corporations, work the system to avoid taxes even when they make a profit)

Most of the businesses I've worked with focus on EBIT (earnings before interest and taxes) as a key metric.  No EBIT?  No taxes.  

I've never heard someone say:  "Wow, the corporate tax rate just went down.  Let's get serious about making money now -- we were just playing before."  

Have you?






Here's a good article on how corporations are the real "moochers".

http://www.southernstudies.org/2012/09/corporations-are-the-real-moochers.html

Pictures worth a 1000 words--mass transit

Ah, we love our cars, but alas, gasoline is getting more scarce.  Think we should invest in public transportation?

Question for the debates

I've got a question for the debates that hasn't been asked.   I'd really like to hear what they say on this one:


"What do you plan to do to help the 50 year olds who have been hardest hit by the last recession?  These individuals want to contribute and have skills and talents to do so, but have a rough time competing for jobs."  


Please be specific -- answering "loosen government regulations" or "lower taxes on business" will not be accepted.


Please comment if you have an idea that might work on this.