Healthcare

Post image for Professional Licensing: A Risk to the Free Markets and Freedom of Speech

From physicians to dentists to lawyers, the licensing requirements of many professions are well known—but for bloggers? A recent case in North Carolina demonstrates the dangers that mandatory occupational licensing poses to liberty and how established interests use such requirements to protect their bottom line.

North Carolina resident Steve Cooksey was ill, obese, and struggling with type 2 diabetes. In 2009, after being rushed to the hospital, nearly in a coma, he decided to do everything in his power to get healthy. By following a low-carbohydrate diet, Cooksey claims he was able to drop 45 pounds and get off insulin and drugs. He documented his story on his personal blog, where he provided advice to others practicing the “paleo” diet that he believes saved his life.

That sounds like a win-win situation, but not according to the North Carolina Board of Dietetics and Nutrition (NCBDN), which decided to go after Cooksey for the “crime” of offering nutritional advice without a dietitian’s license. In 2011, it sent Cooksey a letter, claiming that his blog, by giving readers “unlicensed dietetic advice,” even for free, violated North Carolina law. The NCBDN included a 19-page copy of his online writings with comments in red ink pointing out what he could and could not say.

Even more surprising, the notice asserted that Cooksey’s private conversations with readers and friends via email and telephone also constituted a violation of the state’s dietitian licensing law!

Unfortunately, Cooksey’s case is far from an isolated incident. In just about every state, there is a dizzyingly long list of jobs that require would-be workers to go through a long, expensive, and sometimes arduous process to earn the privilege of entering into a given profession. While the stated reason for requiring occupational licenses is public safety, established players operating under existing licensing schemes usually fight tooth and nail to maintain occupational license requirement in place, to make it harder for potential competitors to enter the market.

Today, roughly 30 percent of jobs in the U.S. require some form of license (a sharp increase from a low back in 1950, when the share was only 5 percent). Fortunately, some workers are fighting these licensing regime—and many are winning.

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Former Competitive Enterprise Institute Research Associate Michael Mayfield provided invaluable assistance with this post.

Matt Drudge’s widely discussed tweet that he has already paid Obamacare’s “liberty tax” highlights the uncertainties the self-employed face both from the health care law and the tax code in general. As pointed out by an editorial in Investor’s Business Daily, “self-employed entrepreneurs ranging from Drudge to small-shop proprietors and independent contractors have long been aware of the requirement to estimate their tax liability and send a quarter of it in every three months, and that this amount includes ‘other taxes’ such as the ObamaCare opt-out penalty.”

The threat of the IRS penalty from Obamacare’s individual mandate, perhaps more than the president yukking it up with comedians like Zach Galifianakis, may be driving the apparent pickup in enrollment in advance of the law’s March 31 deadline. “Worries over fines aid health insurance sign-ups,” reads the headline of a March 23 Wall Street Journal article. Even if the penalty this year is relatively small for many Americans, fear of the IRS can be a great motivator.

The good news — for Drudge and other Americans who don’t want to buy an Obamacare-compliant plan due to personal objections or just plain cost — is that in many cases there is a practical escape hatch from the IRS penalty. And this option may end up offering better and more affordable care than Obamacare. The only catch is you’ve got to have a little faith.

Buried in Section 1501 on page 148 of the so-called Patient Protection and Affordable Care Act is an exemption from the individual mandate for a “health care sharing ministry,” a group whose members “share a common set of ethical or religious beliefs and share medical expenses among members in accordance with those beliefs.” For any member of such group, the law says, “No penalty shall be imposed.”

It’s somewhat of a mystery how those pushing the law allowed such a potentially large exemption to the individual mandate to be inserted in the first place. This is definitely a case in which the law’s supporters, four years after the law has passed, don’t seem to know what’s in it. But fortunately, many Americans are finding and utilizing this escape hatch.

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“The new healthcare law will slow economic growth over the next decade, costing the nation about 2.3 million jobs and contributing to a $1 trillion increase in projected deficits, the Congressional Budget Office said in a report released Tuesday. The non-partisan group’s report found that the healthcare law’s negative effects on the economy will be ‘substantially larger’ than what it had previously anticipated,” reports The Hill. “The CBO is now estimating that the law will reduce labor force compensation by 1 percent from 2017 to 2024, twice the reduction it previously had projected. This will decrease the number of full-time equivalent jobs in 2021 by 2.3 million, CBO said. It had previously estimated the decrease would be 800,000.”

Originally, the Congressional Budget Office had wrongly concluded that Obamacare would reduce the deficit. It reached that incorrect conclusion by allowing supporters of Obamacare to hide its costs through accounting gimmicks and dodges. But in 2010, after Obamacare passed, it began increasing its cost projections for Obamacare, and also admitted “that Obamacare includes work disincentives likely to shrink” the economy.

Obamacare contains massive marriage penalties that discriminate against married people, and huge work disincentives for some older workers. It has slashed hiring, cut economic growth, and induced employers to replace full-time workers with part-time employees, driving even unions that once backed it to seek its repeal or replacement. Obamacare’s medical device tax has caused layoffs by medical manufacturers.

Due to Obamacare, millions of health insurance policies have been canceled, or replaced by policies with higher premiums and deductibles. In November, the president announced a supposed “fix” that was illegal, didn’t restore the canceled policies, and was designed to scapegoat insurers rather than restore lost health insurance. In December, the president announced another “fix” that made things even worse, by illegally violating property and contractual rights, in a way that may drive up insurance premiums in the future. The administration’s illegal 2013 suspension of reporting requirements mandated by the healthcare law may lead to billions of dollars in fraud.

ECONOMIC MOBILITY
Iain Murray, Vice President for Strategy:
“The fact is: Today’s America is divided between those who work for government and those who don’t. Those who work for government have a job for life, guaranteed retirement and other benefits, and financial security,” said Murray. “Those who don’t, have uncertain prospects. They are at the mercy of an administration that is making their benefits more expensive and restricting their access to credit with more and more regulations. That is the true inequality in President Obama’s America.”

Ryan Young, Fellow:
“Given what reports suggest will appear in the president’s State of the Union address, we need to keep in mind three things. First: A higher minimum wage is not a free lunch, and will force some employers to reduce hours or fire workers. And, second, extending unemployment benefits will keep unemployment unnaturally high,” said Young. “The third thing is: If the president is truly concerned about the poor, he should support policies that would make the poor better off instead of focusing on income inequality. One of these policies could be a deregulatory stimulus that would make it easier to start a business and hire workers.”

REGULATORY REFORM
Wayne Crews, Vice President for Policy:
“Ours is the era of big borrowing and big regulation — and big executive power, perhaps untethered by Congress or the Constitution. The latter will be a centerpiece of President Obama’s State of the Union address,” said Crews. “What America needs instead is a leaner government that rejects overspending and over-regulating. Leadership means unleashing the entrepreneurial sector from over-regulation, and allowing U.S. citizens their natural right to opt out of big, destabilizing government programs like the president’s health care law.”

ENERGY
Myron Ebell, Director of CEI’s Center for Energy and Environment:
“If President Obama were really committed to boosting the economy, he would tell Democratic Majority Leader Harry Reid to bring the pro-energy, pro-jobs bills passed by the House to the Senate floor for a vote,” said Ebell.” I would recommend the president announce his intentions to approve the Keystone XL Pipeline in the State of the Union address. However, he seems more determined to order new EPA regulations that will raise energy prices and impoverish Americans.”

JOBS & ECONOMY
Aloysius Hogan, Senior Fellow:
“An actual focus on jobs is sorely needed in America, but the president’s promises past and present haven’t borne fruit. Hiring is held back by ObamaCare, according to business surveys. Jobs are being killed by the administration’s regulatory policy such as those in the coal-mining industry. Financing of start-ups and expansion is hamstrung by Volcker Rule red tape,” said Hogan. “America’s labor-force participation rate is the lowest in more than a generation, and the president’s approach to jobs is not helping the situation.”

TECHNOLOGY
Ryan Radia, Associate Director of Technology Studies:
“I expect the president will echo his recent proposal to ‘reform’ the National Security Agency’s mass surveillance programs in his State of the Union address. His latest plan focuses on shifting the burden of collecting, storing and securing Americans’ phone records to telecom companies or another private ‘third party,’” said Radia. “The problem is the government will still be able to access privately held phone records without a warrant. What is worse: outsourcing bulk-data collection to America’s private sector would undermine trustworthy digital relationships, and with them, the nation’s enviable position atop the global information economy.”

FINANCIAL MARKETS
John Berlau, Senior Fellow:
“Given the impact regulations have on our economy, I would like to see President Obama address some of the consequences we are seeing from the Dodd-Frank Act,” said Berlau. “We need a moratorium on issuing new Dodd-Frank regulations in order to allow for a review of the negative, unintended consequences of the current ones. Even Democrats, like Rep. Maxine Waters of California, are concerned about these overly burdensome rules and the suffering they are causing main street banks and credit unions.”

Have a listen here.

CEI and its fellow plaintiffs are appealing an adverse District Court-level opinion in a lawsuit involving health insurance exchanges under the Affordable Care Act. General Counsel Sam Kazman explains the case’s importance not just for health care, but for the rule of law.

The court’s ruling today in Halbig v. Sebelius delivers a major blow to the states that chose not to participate in the Obamacare insurance exchange program. It is also a blow to the small businesses, employees and individuals who live in those states as well. In upholding this IRS regulation that is contrary to the law enacted by Congress, this decision guts the choice made by a majority of the states to stay out of the exchange program. It imposes Obamacare penalties on employers and on many individuals in those states, penalties that Congress never authorized, putting their livelihoods and the jobs of their employees at risk. Worst of all, it gives a stamp of approval to the Administration’s attempt to substitute its version of Obamacare for the law that Congress enacted.

The court does all this despite its own finding that our arguments were supported by, in its words, “the plain language” of the law’s key provision regarding state-established exchanges.  And by erasing the distinction between functions carried out by states and functions carried out by the federal government on behalf of states, the ruling undercuts some basic aspects of federalism. We have appealed this decision, and will shortly move to expedite the appeal.

> View more about the lawsuit at cei.org/obamacare

Post image for Bogus Rationale for Obamacare Still Being Peddled Even after Study Debunked It

“More bad news for Obamacare and its proponents. A new study from Oregon shows that” expanded Medicaid coverage “increased–rather than decreased–both the number of folks crowding emergency rooms and the subset of those who sought care for conditions that clearly were not emergencies. Many health experts who supported the Affordable Care Act had predicted the opposite outcome,” reported Scientific American yesterday.

Similarly, the Daily Caller reported that “a Harvard University study published Thursday concludes that Medicaid enrollment significantly boosts emergency room visits. This is in direct contradiction to the Obama administration’s claims that his healthcare reform law would put a dent in costly visits to the ER as a way to cut spending,” by expanding Medicaid and other subsidized health insurance coverage.

Unfazed by reality, the Democratic Legislative Campaign Committee kept on peddling the very rationale for Obamacare that had just been scientifically debunked. Although the Oregon study showed that expanding insurance coverage increases emergency room visits (and thus drives up costs to the healthcare system), the DLCC claimed just the opposite, suggesting that expanded health insurance coverage magically pays for itself by reducing healthcare costs. On January 2, the DLCC wrote, “Also happening yesterday? Nearly 7 million Americans’ new health coverage went into effect. Those 7 million Americans can now go to the doctor when they’re sick, and their Emergency Room visits will no longer have to be paid for through higher prices for everyone else.”

This claim was found in the email I received yesterday from Michael Sargeant of the DLCC:

From: Michael Sargeant <michael.sargeant@dlcc.org>
Sent: Thursday, January 2, 2014 8:02 PM
Subject: Thanks for the milestone

Hans, something happened yesterday that would have been unthinkable even a few years ago . . .Yesterday’s milestone is that starting January 1st, pre-existing conditions are now gone forever. For everyone.

Also happening yesterday? Nearly 7 million Americans’ new health coverage went into effect. Those 7 million Americans can now go to the doctor when they’re sick, and their Emergency Room visits will no longer have to be paid for through higher prices for everyone else.

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As Obamacare’s implementation went badly enough that it was mocked by comedians on late-night TV, a search for excuses began. The result was the now commonplace, and false, claim that whatever has gone wrong with Obamacare, it’s the GOP’s fault, for blocking legislative fixes to the law.

This political talking point is also used to justify the Obama administration’s repeated changes to the healthcare law, and its suspensions and waivers of key statutory provisions (such as anti-fraud rules), even though the Constitution gives only Congress — not the executive branch — the power to enact and repeal laws. By making legislative fixes impossible, the argument goes, opponents of Obamacare left Obama with no choice but to administratively fix the law himself (never mind that the Constitution does not allow the president to change or ”fix” the law just because Congress declines to do so).

But the GOP did not block legislative fixes, and neither the Obama administration nor Senate Majority Leader Harry Reid, D-Nev., have even offered any legislative fixes. Indeed, Reid has not allowed votes even on legislative changes to Obamacare that are backed not only by all Republican Senators, but also by even many Democratic Senators, as the Washington Post‘s liberal-leaning fact-checker, Glenn Kessler, recently noted. The Washington Post can’t be accused of conservative bias: it endorsed Obama, and hasn’t endorsed a Republican for president since 1952.

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Have a listen here.

The Affordable Care Act’s subsides and tax credits are structured in such a way as to cause thousands of dollars worth of penalties for many married couples. CEI Senior Attorney Hans Bader proposes phasing them out as income rises to soften the blow.

“You screwed me over,” says a woman cited by President Obama as an Obamacare success story. Jessica Sanford was used as a prop in the president’s “bizarre Rose Garden infomercial” on Obamacare last month in a failed “effort to deflect criticism of the botched Healthcare.gov rollout.” Initially, this single mother was “ecstatic” about the prospect of buying insurance on the Obamacare exchanges with generous taxpayer subsidies she had been led to believe she would receive. But after she was used by the president in his Rose Garden pitch, things quickly went sour:

Then came the letter, this time addressed to Sanford. It was from the Washington State health exchange, whose sad duty it was to inform her that the government had miscalculated her eligibility for a tax credit. Her monthly insurance premium for the same “gold” plan she had signed up for had risen from $198 a month to $280 a month. Sanford was frustrated but decided to shrug off. She purchased the new plan, thinking everything was fine.

Then came the second letter reporting another glitch. A “system error” resulted in some “applicants qualify[ing] for higher than allowed health insurance premium tax credits.” The letter included an apology, along with an upwardly revised premium quote of $390 a month — almost twice what her original policy cost her — and with a higher deductible. In addition, her plan status had been downgraded from “gold” to “silver.” (A cheaper “bronze” plan, Sanford said, was available at $324 per month, with a higher deductible still, but even this was beyond Sanford’s budget.)

The third letter was the final straw. It read, as only machine-generated government letters can:

“Your household has been determined eligible for a Federal Tax Credit of $0.00 to help cover the cost of your monthly health insurance premium payments.”

In response, she posted a comment at the Washington Obamacare exchange’s Facebook page: “Wow. You guys really screwed me over. Now I have been priced out and will not be able to afford the plans you offer. But, I get to pay $95 and up for not having health insurance. I am so incredibly disappointed and saddened. You majorly screwed up.”

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