Category Archives: Health Care

Price Controls and Health Insurance

I’m quoted in a Fox News piece about Democratic presidential candidate Pete Buttigieg’s health care plan:

Ryan Young, a senior fellow at the Competitive Enterprise Institute, told Fox News that consumers would continue facing high costs even with reduced premiums. on Thursday. “Their lower premiums would not reduce health care costs, either. They would have to be made up for with some mix of higher taxes, increased debt, lower health care quality, slower innovation, and reduced availability. Price controls are not a free lunch,” he said on Thursday.

The article is here. Similar arguments apply to other candidates’ proposals from both parties, which mostly tinker around the edges of a system already mostly built around third-party payments intended to insulate costs.


CEI Podcast for July 24, 2014: Victory in Halbig v. Burwell

General Counsel Sam Kazman talks about what the Halbig decision means for the Affordable Care Act, as well as broader principles such as taxation without representation and the rule of law. Click here to listen.

CEI Podcast for January 23, 2014: CEI Appeals Affordable Care Act Lawsuit Verdict


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.

CEI Podcast for December 18, 2013: The FDA Goes after 23andMe

Have a listen here.

The Food and Drug Administration recently banned 23andMe, a genetic testing service, from marketing its product to consumers. CEI Executive Director and Senior Fellow Gregory Conko thinks the FDA should reverse the ban.

CEI Podcast for December 12, 2013: The Affordable Care Act’s Marriage Penalties

Wedding rings
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.

Rent-Seeking Watch: Former Rep. Jason Altmire

Back when he was a congressman, Jason Altmire (D-PA) bucked his own party and voted against the Affordable Care Act. He left office earlier this year and now works for a health insurance company in Florida. Seeing as the law legally requires people to buy his employer’s product, he unsurprisingly now supports the law.

Possible Unintended Consequences in New Health Care Regulation

The Affordable Care Act bans health insurers from denying people coverage if they have certain pre-existing medical conditions. A regulation partially implementing that policy appeared in today’s Federal Register. It is the first “economically significant” regulation ($100 million or more in annual economic impact) to appear since April 18. This interim final rule extends the Pre-Existing Condition Insurance Plan (PCIP) program through 2014.

How much does it cost? The analysis accompanying the rule is vague. It does say that the Health and Human Services Department “is authorized to disperse $5 billion to pay claims and the administrative costs of the PCIP program that are in excess of premiums collected from enrollees.” Essentially, if insurers and providers are required to take losses on some of their patients, Washington has agreed to subsidize some of the difference with taxpayer dollars.

Since this is government spending, I won’t include this $5 billion in my running tally of compliance costs for this year’s economically significant rules (currently ranging from $5.58 billion to $10.19 billion, as of the most recent Battered Business Bureau post).

The rule acknowledges administrative costs, but claims they will be minimal since they build on existing systems. It gives no numbers.

The cost analysis also states, “With respect to other parties, we lack data with which to quantify costs associated with this regulation.” Since the bread and butter of this regulation is a series of price controls and subsidies, it can be hard to quantify how patients and providers might change their behavior.

Some providers, because of the price controls and paperwork involved with the PCIP, might opt to simply refuse to treat patients in the PCIP program. The rule acknowledges this:

While we understand that the decision to no longer treat PCIP enrollees is possible, we believe and are hopeful that most facilities and providers will accept the new payment rates established in this interim final rule given the serious health conditions many federally-administered PCIP enrollees have and the prospect that such reduced payment is temporary until 2014 when no one can generally be denied health coverage because of a pre-existing condition.

People change their behavior when their incentives change. The PCIP program gives health care providers an incentive to refuse treatment to people who desperately need it. And that unintended consequence, as opposed to paperwork, may be the true cost of today’s regulation.

CEI Podcast for May 2, 2013: Small Business Owners Sue Over IRS Obamacare Power Grab

Have a listen here.

Small business owners and individuals in six states, with help from CEI, are suing the IRS over what General Counsel Sam Kazman calls a flagrantly illegal expansion of the Affordable Care Act.

Lobbying Can Be a Great Investment

Health insurance companies spent tens of millions of dollars lobbying on the health care bill. In return for that investment, they convinced the government to require everyone in the country to buy their products, on pain of a fine. As it turns out, the law has done more than grow their customer base — the Washington Post reports today that those customers will soon be paying through the nose:

Some Americans could see their insurance bills double next year as the health care overhaul law expands coverage to millions of people.

The nation’s big health insurers say they expect premiums — or the cost for insurance coverage — to rise from 20 to 100 percent for millions of people due to changes that will occur when key provisions of the Affordable Care Act roll out in January 2014.

Rent-seeking can be a very lucrative investment. Imagine how many billions of dollars health insurer’s eight-figure million lobbying investment will yield in profit. With a rate of return like that, it’s a wonder that most businessmen are still honest.

Orwell Is Smiling

Politico headline: White House: Mandate not a tax, but a choice