Monthly Archives: September 2013

Obamacare – the View from California


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This article was first posted by American Thinker on September 29, 2013.

California, the so-called Golden State, has often been a national leader over the years.

Now, in the arena of national health care reform, California, with its Covered California (CoveredCA), the first state benefit exchange in the nation, claims to be leading the way in the creation of state health insurance exchanges or marketplaces.  These exchanges, created by the Patient Protection and Affordable Care Act of 2010, PPACA, the ACA, or Obamacare) will allow both individuals and small businesses with up to 50 employees to purchase qualified health care coverage.

The ACA requires that all states have operating exchanges by January 1, 2014 with plan launch dates three months earlier on October 1 to allow time for people to analyze, purchase and enroll in the program before the January 1 effective date.  Two alternative options are provided for the states to achieve this goal:  either create their own or default to a federally run exchange.

When the law was passed in March of 2010, estimates were that it was likely that of the 50 states, 40 or more would choose to create their own exchange, while the balance would default into federally run programs.  In fact, as of this date, the facts show precisely the opposite. Only 17 states have taken the path of doing it themselves, while 33 have decided to leave it up to the Feds.  (For a breakdown of which states have chosen which path, see page three here).

We are now only days away from the October 1 launch date on which CoveredCA has promised that plan rates and descriptions will be available for licensed and certified insurance agents to sell.

In the last three business days, I, as one who’s been involved in California’s health care industry for over 30 years, have spent nine hours in face-to-face seminars and two more hours in a CoveredCA sponsored webinar. I believe that a quick glimpse of some of the hard core realities of the Obamacare Health Insurance Exchanges would be of interest to my fellow Americans.

Sadly, as of now, there are zero plans with rates or benefits approved for sale by either of California’s two state insurance regulatory bureaucracies – the Department of Managed Health Care (DMHC) or the Department of Insurance (DOI).  Even if there were plans available, there’s no one to sell them because there are zero licensed and certified agents contracted with CoveredCA.

Yesterday I was invited to join in a webinar sponsored by one of the General Agencies (general agencies are essentially insurance plan distributors and are an integral part of the health care landscape) and CoveredCA itself.  During the presentation, Chris Patton, Vice President of the SHOP (Small Business Health Opportunities Program, the part of the exchange tasked with selling to small businesses) dodged a key question from the audience with the aplomb of an experienced politician.

Responding to the “elephant in the room” question of whether plan rates and benefits would be available for consumers to purchase and agents to sell as of the 10/1/2013 target launch date, Mr. Patton elaborated at some length that we should understand that with 13 carriers in the SHOP, each of whom was offering multiple plans, the regulators had a lot of work to do, and only a certain amount of time in which to complete it. He continued by saying that although he expected that plans and rates would be approved and announced by October 1, and that he had no reason at all to believe that they wouldn’t be, he hoped that everyone would remember the immense workload, understand that all parties were doing their best and trying very hard to achieve that goal.

Now I don’t know about you, but that sounds suspiciously like a “no” answer to me.

But let’s skip ahead to that time – whenever it comes – when CoveredCA starts selling plans.

The media is infested with glowing claims about how Obamacare will reduce medical plan costs, saving consumers thousands of dollars.  Just days ago on September 25, less than a week before the plans go on sale, the Department of Health and Human Services released a glowing report on premiums, pointing out how much lower costs will be than projected.

But, in the words of Forbes magazine, “the reality is starkly different.”

Assuming that the price and plan benefit structures of the plans which are eventually approved for sale by CoveredCA end up more or less as they were submitted to the regulators, a full and complete analysis of the 2014 plans vs. the 2013 plans will be very interesting.

Many analysts from all sectors are asking the same question: With the elimination of health underwriting (meaning that unhealthy buyers will pay the same premiums as healthy ones), the mandatory increase of benefits such as pediatric dental and vision care, as well as the mandatory inclusion of ten Essential Health Benefits in all plans, and finally the inclusion of a number of new fees and taxes, how can costs possibly go down?

It’s easy.

  • Find doctors who’ll work more cheaply
  • Restrict consumer choice so plan members can only go to those lower priced doctors
  • Degrade the benefits of those much ballyhooed “cheaper” plans.

To explore how insurance companies get doctors who’ll work more cheaply requires a brief explanation of provider networks, often called PPO (Preferred Provider Option) or HMO (Health Maintenance Organization) plans.

The way both of these types of networks operate is that the insurers get together with doctors and negotiate prices.  Those doctors who agree to give the insurer lower prices, or perhaps who capitulate to the insurer’s demands for lower prices, depending on one’s perspective, are the ones who get on the network.

Both PPOs and HMOs have become the standard in the medical plan world over the past 25 to 30 years.  Most insurance carriers have developed comprehensive, widespread networks that include many outstanding medical practitioners, including such famous medical centers as Stanford, Cedars-Sinai, UCLA, UCSF and many more.

But which hospitals and doctors do you think we’ll see on the new restricted, leaner, limited networks?  The famous ones who have six-week waiting lists to get seen?  Don’t bet on it.

The Los Angeles Times wrote in May, “People who want UCLA Medical Center and its doctors in their health plan network next year, for instance, may have only one choice in California’s exchange: Anthem Blue Cross. “  But less than a month later Anthem Blue Cross pulled out of the California SHOP.  Let’s see, one minus one equals zero, right?

In the same article Blue Shield admitted that its slimmed-down CoveredCA members would see only 37% of the doctors who make up Shield’s regular, long-established network.

Health Net, the only other state-wide carrier with a variable size network, a network that the insurer can enlarge or reduce at will by modifying the requirements for participating doctors, may have as few as 33% of their regular network providers available to CoveredCA members in many geographic areas.  Health Net explains that to the currently uninsured, price is a key factor, so it built a narrow and hence less expensive network to serve that target market.

That’s fine, shave your costs and restrict your networks to help push the prices down – but then don’t use those plans to tell us that Obamacare Exchanges are reducing costs.

Interestingly, Kaiser, which historically has been the lowest cost plan provider in California, will very likely lose that distinction in the Exchange. Why? Because Kaiser doesn’t have a variable size network; it has its own closed network, and the size of that network is fixed. If you’re on a Kaiser plan, you have to go to a Kaiser doctor in a Kaiser facility or you won’t be treated.  And Kaiser has no way to further shrink its own proprietary network. Kaiser is Kaiser, end of story.

As to my comment about degrading plan benefits, during the seminar which I attended today, one of a series of many nationwide events held by an industry leading insurer, there was a PowerPoint slide which compared one of their 2013 current plans with an “equivalent” 2014 plan (which they’re hoping the California bureaucracy will soon approve).

The slide showed a 2013 $500 deductible, $30 office visit copay plan with what was offered as an equivalent 2014 plan, a $1500 deductible, $20 office visit copay plan.  Remember, the deductible is that amount that must come out of your pocket before the insurance company starts paying the big bills, like surgery, hospitalization, MRIs, CT scans, lab tests, and so on.

Seriously?  Since when does a 2013 deductible of $500 become equivalent to a $1500 deductible plan in 2014?  That’s 300% inflation – not equivalent! If you’re comparing costs between those two plans, it’s not hard to see how you’d think the 2014 plan was cheaper, but only until you have a claim.

I will leave you with two critical questions to ponder:

1 – If California, the alleged national leader, is this far behind where they promised to be and where they should be to have a viable, functional product available by October 1, how far behind the deadline are all the rest of the states and the federal government?

2 – If CoveredCA is this far over their heads in getting ready to sell these brand new plans to millions of people all over California, how ready are they going to be to administer, service, and satisfy those millions of people as customers once they sign up for coverage?

I, for one, have no great interest in becoming one of the first guinea pigs in the beta testing of any of the Obamacare Medical Exchange upcoming product launches. Do you?


The Problem with Internationalism


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The recent debate over intervention in Syria demands a broader discussion of the United States’ role in the international community. While the notion of an imminent military strike seems to have passed for now, we should not let this incident slide into obscurity. It is time to critically evaluate American foreign policy and to determine what role our nation must have as a part of the international community.

For years we have been considered the “world’s policemen”, a role that is untenable and often promotes the interests of foreign countries over our own. This role has a lengthy history, but it is important to examine how our foreign entanglements have changed over the last couple of decades. During the Cold War, we could not police the entire world, but we were tasked with preserving stability in what was then referred to as the Free World, with the Soviets enforcing stability on their side of the Iron Curtain. During the Cold War, we actively worked to promote our interests throughout the world. We supported regimes that opened trade with the United States, and we suppressed rebellions that would disrupt the stability of allied countries and crucial regions.

The end of the Cold War saw a collapse in this international balance, with the former Soviet states incapable of enforcing the stability to which the Eastern world had grown accustomed. In the intervening two decades, the United States has been called in to act as an enforcer of international law. Time and time again, we intervene in foreign affairs due to human rights violations or as part of a UN or NATO task force. The crucial difference being that rather than engaging in competition with our political and economic enemies we are enforcing the dictates of international conventions and organizations. We have shifted from pursuing foreign policy concerns that further our interests to channeling our resources into matters which are necessarily to the benefit of our citizenry. It is this change from national concerns to international concerns that must be re-evaluated.

The duty of a national government is to promote the interests of the nation first and foremost. The Founding Fathers understood this, with political ideals derived from the philosophical tradition of social contract theory. This theory held that individuals came out of the state of nature (a state of anarchy before political institutions) in order to enjoy certain benefits that they had lacked in the state of nature. John Locke was arguably the most influential of these political philosophers on the founding of America, and he claimed that individuals join together in governments in order to protect their natural rights and allow for some impartial judge to adjudicate disputes between members of this government.

This philosophical tradition is relevant to the concerns of American foreign policy as it designates the purpose of a government, at least a government that the Founding Fathers hoped to create. While clearly nuanced, the purpose of a government, under this theory, is the protection of the rights of its citizens and the adjudication of their differences within the civil society. It is the promotion of the members of the social contract that concerns the government. That which does not advance their concerns by protecting their rights and property is not the purpose of a government as the United States was envisioned.

In this philosophical context, I will call upon George Washington’s famous farewell address of 1796. This speech is often quoted as an endorsement of isolationism, but it is more complex than that. “It is our true policy to steer clear of permanent alliances with any portion of the foreign world; so far, I mean, as we are now at liberty to do it; for let me not be understood as capable of patronizing infidelity to existing engagements. I hold the maxim no less applicable to public than to private affairs, that honesty is always the best policy. I repeat it, therefore, let those engagements be observed in their genuine sense. But, in my opinion, it is unnecessary and would be unwise to extend them.”

The salient feature of Mr. Washington’s speech is its warning against the idea of entangling alliances. In the 1790s, war was brewing between France and England, and Washington was afraid that an alliance with either one would drag the fledgling nation into war and destruction. Today, we do not primarily fear being brought into a war where we will be overpowered and crushed, and we certainly are not overshadowed militarily by our neighbors. The dangers of entangling alliances, however, remain as they can obligate the United States to enter conflicts which are of no benefit to its citizenry.

It is generally accepted that a strike on Syria does not promote our national interests. We have been reluctant to even arm the opposition, in fears that the widespread conflict will spread to other regions. The idea that conflict in Syria could spill even more into Israel and Turkey, or even into Iran, is a terrible specter that has given American policy makers pause time and time again (cite). Furthermore, it seems clear that, regardless of which side wins the Syrian civil war, we will not find an ally there. Assad will continue to work with Russia, China, and Iran, which certainly would not promote our interests. If the rebels succeed, we face the prospect of a hardline Muslim regime. Egypt’s brief rule by the Muslim Brotherhood certainly did not further United States interests, suggesting that a similar regime in Syria would be equally inhospitable. The destruction of Assad’s regime, moreover, would promote instability in the country, just as Mubarak and Gaddafi’s overthrows did.

Instead the impetus for a strike is based on the so-called “red line” advocated by President Obama. In 2012, Obama declared that he would intervene in Syria if Assad were to use chemical weapons. When Assad eventually did use chemical weapons, Obama announced that we would strike Syria and destroy their capability to use such tactics. A hailstorm of criticism against Obama harangued him for not consulting Congress before establishing this “red line” as it forced our foreign policy credibility to depend on a unilateral policy statement by the president. Obama responded to this criticism claiming that it was not his red line, but instead it was a line drawn by the international community. Despite the lack of UN support for the strike, Obama claimed that the international community had historically condemned and forbidden the use of chemical weapons as enshrined in the Chemical Weapons Convention. A failure to enforce these laws, he said, undermines not just his credibility but the credibility of these international agreements.

Let us take Obama at his word for a moment. There is certainly a lot of international legal precedent against the use of chemical weapons. Obama’s claim that there is an international red line is accurate, but why does that mean that America must enforce those laws? This is an even more pressing question given that the UN itself is not supportive of a strike. How is the enforcement of international law in this case important enough to outweigh all the potential negatives of a strike? Our president’s desire to spend American taxpayer dollars and jeopardize American national security and economic interests in such a manner sets this international law over the pursuit of American interests. How is this the proper function of our government?

Now, of course, I must be charitable towards President Obama. He is our president after all. There are plenty of arguments for why a strike on Syria is necessary for American interests. While I explain these arguments, please keep President Washington’s warning in mind.

The President of the United States did set an ultimatum concerning the use of weapons of mass destruction. If he chose not to enforce this declaration, it would undermine the credibility of the United States on international matters. South Korea has expressed fear that North Korea would not be deterred by American threats of violence. This is a problem similar to that which faced President Eisenhower when the Soviet Union invaded Hungary. He had pursued a foreign policy which asserted that the United States would attack the Soviets if they attempted to expand in such a fashion. When he did not uphold this threat, it undermined our credibility and foreign policy strategy. This is a very real problem in today’s age, as we attempt to enforce global stability and support our allies across the globe.

So here is the crucial problem. We have become obligated, based on our extensive involvement in the international community, to advance a foreign policy agenda that does not promote our interests. It does not promote our economic ties, nor does it advance allied interests in Syria, nor does it promote stability in the region, yet it is necessary to strengthen our credibility given our traditional role of enforcing international law. We have entangled ourselves so hopelessly in the international world, so completely embraced this internationalist mentality, that our government is compelled to act against our interests.

This dilemma does not mean that the United States should pursue a policy of isolationism. There are plenty of ways in which our foreign involvement does benefit the United States. We promote economic growth in countries that either manufacture goods for export or purchase American products, and we ensure stability in regions that are crucial to our national security and economic interests. The extent of this involvement, however, should be a pragmatic one. The pursuit of international law and order, as we can see with Syria, is not a pursuit in and of itself that benefits the United States. We must be aware, however, that our leaders should be looking out for our interests, not those of the UN Security Council.

The debate over Syria should be a wakeup call to America. It teaches us that our foreign entanglements have reached such a point where we can no longer be the sole judges of our national policy. By refusing foreign involvement in Syria, we can start a precedent that the United States is no longer the world’s policeman. We must demand that our leaders uphold our laws and our interests, not those of the international community.

Thomas Jefferson painting 518

Challenging the New Aristocracy


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The following was first published by American Thinker on their website, September 19, 2013.

Do we, as Americans, want political office in the United States to be up for sale to the highest bidder?

A “yes” answer to this question may come to define our nation’s leadership if we don’t all unite to stand forth and give a resounding shout of “NO!” that resonates from sea to shining sea.

Thomas Jefferson has always been regarded as an honest, ethical leader, even by his opponents.  What would Thomas Jefferson do if he were asked this question? He gives us at least a partial answer in his draft of “A Bill for the More General Diffusion of Knowledge” (1779):

“For promoting the public happiness those persons whom nature has endowed with genius and virtue should be able to guard the sacred deposit of the rights and liberties of their fellow citizens, and they should be called to that charge without regard to wealth, birth or any other accidental condition or circumstance.”  (emphasis mine)

We all surely agree that given a choice, we would want our leadership to be endowed with both “genius and virtue.”  I ask you:  “Do those qualities strike you as defining the majority of our current and recent leaders?”

A specific person-by-person enumeration would accomplish little, but with almost no effort one can call to mind politicians who have resigned their office for sexual misadventures such as “sexting,” and for accepting bribes and illegal use of campaign contributions.

Even worse, presidential candidates commonly make campaign promises and statements, only to renege once they’ve changed their residence to the White House.

But now let us move on to the part of Mr. Jefferson’s statement that is easier to remedy, for neither genius nor virtue can be easily legislated.

“They should be called to that charge without regard to wealth,” he said in the above referenced bill. He later expanded upon the same theme in his Autobiography: “An aristocracy of wealth is of more harm and danger than benefit to society.”

A very interesting phrase – “An Aristocracy of Wealth.”

With that in mind, let’s take a quick look at the net worth of ten prominent 21st century American political figures:   (Sources are here and here.  Also note that married couples reflect their joint assets though both spouses are listed only if both are political figures.)


Michael Bloomberg (Governor) $19.5 billion
John Kerry (former Senator, 2004 Presidential nominee, current Secretary of State) $394 million
Arnold Schwarzenegger (former Governor) $300 million
Mitt Romney (former Governor, 2012 Presidential nominee) $250 million
Michael McCall (US Congressman) $290 million
Darrell Issa   (US Congressman) $140 million
Bill and Hillary Clinton (Bill – former President, former Governor; Hillary – former Senator, former Secretary of State) $101 million
Caroline Kennedy (US Ambassador to Japan) $100 million
Jay Rockefeller (US Senator) $ 81 million
Mark Warner (US Senator) $ 76 million


Obviously these figures fluctuate from year to year. For example, when John Kerry ran for President, his net worth was variously estimated at between $900 million and $3.2 billion.

The brief list above ignores such luminaries as George W. Bush, Diane Feinstein, Barack Obama, Nancy Pelosi, and many others. It’s nearly impossible to name all of those who fall into the lesser category of from $10 million to $50 million in net worth.

The resources provided by this much wealth are immense! How can anyone even begin to compete against a man like Mr. Bloomberg, with a net worth of nearly $20 billion, unless it might be Donald Trump, who proclaims his net worth as over $10 billion and has said he’ll spend what it takes if he decides to run for President.

Has America now reached the point where you must be rich to be a leader?  That’s a question we’ve been asking ourselves for years, but unfortunately it seems that the answer is becoming a more resounding “YES!” every year.

Isn’t it time to consider changing the mechanics of campaign funding following the spending explosion in 2012 when the two major candidates combined to spend in excess of $2 billion on their presidential campaign?

You may now be asking, “Hasn’t anyone ever thought about this before?”  The answer is, “Of course they have.”

In 1971 Congress passed the Federal Election Campaign Act and the Revenue Act, which established the Presidential Campaign Election Fund (PECF) and allowed taxpayers to designate $1 (later increased to $3) of their tax dollars to finance presidential elections.

Keep in mind, this campaign reform law only addressed presidential elections.  Neither US senatorial or congressional campaigns, nor any campaigns at the state or local level were included; just the race for the White House.  But we have to start somewhere, and the logical place to start is the Presidency, since it’s the highest office in the nation.

A key point here is that by checking the box, you don’t pay more in taxes, or reduce your tax refund.  You simply tell the government that they MUST take $3 of your taxes, and put those funds into the PCEF.

2012 Form 1040

In the beginning, right after the fund was established, it was very popular, but over the years, perhaps because of lack of understanding or lack of publicity, the contributions have declined significantly, as the following chart reveals:

% of US income tax returns directing the government to deposit tax income into the PECF





















A very cynical person might suggest that the federal government would prefer that fewer Americans select this option because every dollar that goes into the PECF is one dollar less that the Feds have to spend in other areas.  This writer, of course, is not that cynical.

The catch to accepting federal funding is that it imposes a limit on how much each candidate could spend. So if there’s not enough money in the pot to reasonably fund a campaign, or if the candidate thinks he or she can raise more campaign funds on his or her own, there’s a compelling reason to decline the PECF support.

Nevertheless, the concept created in 1971 performed excellently in every presidential election campaign from 1976 through 2004, with every single qualifying candidate accepting the federal funds and adhering to the required maximum spending limit. Every single one!

Sadly, the system broke down in 2008, for the first time in history, when one of the two major party candidates declined to accept the federal funds, choosing to refuse the PECF support and hence escape the campaign spending limits created by the Federal Election Campaign Act reform 37 years earlier.  Four years later, in 2012, both major party candidates declined federal funds.

This doesn’t mean we need a radical revision of our entire campaign system.  What we’re suggesting is a small adjustment which will have significant positive ramifications in future elections.

The problem facing America today is that there is such an incredible amount of money out there – corporate funds, PAC funds, union funds, and what seems like “pocket money” from billionaires – that a pittance like the less than $100 million offered by the PECF in 2012 just doesn’t cut it.

But there is a fix.  If we publicize the PECF check off box on our tax returns we could almost certainly increase the funding for candidates so significantly that the system would once again function as intended.  It would give the lesser known people with “genius and virtue” a real chance to compete.

Let’s look at the numbers:

In the four-year period from 2009 to 2012, the average check off percentage was 6.5% for taxpayers, which created a total influx into the PECF of $188.5 million over the four years.

If we could get the contribution back to the approximately 20% level that it was during the first 20 years of the PECF, that $188.5 million could become $582 million!  At the 25% level that it averaged for the first 10 years after reform, the pot becomes over $742 million.

Of course, the solution isn’t quite that simple.  Part of the PECF goes to to primary participants, there’s a matching formula involved, and the current spending limit might need to be addressed.  But with three to four times the resources available to help the candidates out on the campaign trail, we’d definitely be taking a big step in the right direction.

It is probably unlikely that Americans would raise the PECF to where it would surpass the resources of the multiple PACs, unions, and media giants, and even if it did, this would not eliminate PAC spending. PAC spending is not legally a campaign contribution, but almost surely with increased publicity and a strong bipartisan effort we could push the PECF dollars up to where less financially endowed candidates would be able to enter the fray, make themselves heard, and have an excellent chance to reach the magical debate platform where the voters of the nation could examine their qualifications as serious candidates.

We need to change the current paradigm, and the revival of the PCEF is an excellent way – perhaps the only possible way – to continue to make political office accessible to Americans who aren’t extremely wealthy.

Clearly this is not a complete and total solution to the problems we face, but it would be a start, a way to begin to level the playing field.  We must wrest control of America from those of well-nigh unlimited wealth or it won’t be too long before we see political offices up for sale on eBay.

Thomas Jefferson, who distrusted the aristocracy of wealth, did believe in an aristocracy of a different kind, as described in his letter to John Adams, October 28, 1813:

“I agree with you that there is a natural aristocracy among men. The grounds of this are virtue and talents. [This] natural aristocracy [is] the most precious gift of nature for the …government of society.”

Jefferson Memorial Statue 518

War on the Coast of the Mediterranean?


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On the night of February 16, 1804, Lieutenant Stephen Decatur led a small force of U.S. Marines on board a small captured Tripolitan vessel re-named the USS Intrepid close enough to the USS Philadelphia to board her. Under Decatur’s leadership, the Marines stormed the ship and overpowered the pirates to take control. With fire support from  American warships, the Marines then set fire to the Philadelphia, destroying her in order to prevent her future use by the enemy. British Admiral Horatio Nelson, one of the all time greatest heroes of the British navy, reportedly called this “the most bold and daring act of the age.”

Did the United States undertake this campaign on its own?  Did Congress approve of President Jefferson’s deployment of US naval forces?

Emphatically not!  While Congress never made a formal declaration of war, they did authorize President Jefferson to issue orders to the commanders of American ships-of-war to seize all vessels and goods of the Pasha of Tripoli as well as “to cause to be done all such other acts of precaution or hostility as the state of war will justify.”

As allies, the Americans squadron joined a Swedish flotilla under Rudolf Cederström in blockading Tripoli, the Swedes having been at war with the Tripolitans since 1800.  US forces were also aided by King Francis of the Kingdom of the Two Sicilies who supplied the Americans with manpower, craftsmen, supplies, gunboats, mortar boats, and the ports of Messina, Syracuse and Palermo to launch the offensive against Tripoli.

In the painting shown here, the small boat in the near left corner is the Intrepid carrying the escaping Marine raiders away from the flaming Philadelphia.



Leading the Way?


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California, the Golden State, named incidentally for the state flower, the Golden Poppy, not for the veins of the shiny metal that engendered the Gold Rush of the mid 1800’s, has often been a national leader in many ways over the years.

Now, in the arena of national health care reform, California with its Covered California (CoveredCA), the first state benefit exchange in the nation, is leading the way in the creation of state health insurance exchanges or marketplaces. These exchanges, created by the Patient Protection and Affordable Care Act of 2010 (PPACA, the ACA, or Obamacare) will allow both individuals and small businesses with up to 100 employees to purchase qualified health care coverage.

The ACA requires that all states have operating exchanges by January 1, 2014, and provides two alternative options for the states to do so:  either create their own, or default to a federally run exchange.

Initially when the law was passed in March of 2010, estimates were that it was likely that of the 50 states, 40 or more would choose to create their own exchange, while the balance would default into federally run programs.  In fact, as of this date, the facts show precisely the opposite. Only 17 states have taken the path of doing it themselves, while 33 have decided to leave it up to the feds.  (For a breakdown of which states have chosen which path, see page three here).

In May, CoveredCA made three significant announcements.

First, they announced the health insurance carriers that would be offering plans in the exchange, though several major national carriers which have been offering plans in California for years were conspicuously absent from the list: Aetna, CIGNA, and United Healthcare.  Anthem Blue Cross, the largest non-Kaiser provider of health plans in California subsequently joined those three as a non-participant, leaving only three major insurers in the Small Business exchange: Kaiser, Blue Shield, and Health Net.

Second, CoveredCA provided a comparison chart showing plan benefits and costs for two examples, a 25 year old and a 40 year old, and promised to release full details for all plans and their respective costs in June.

Third and last, CoveredCA confirmed that only licensed insurance agents would be able to actually sell these plans, and that an additional certification would be required on top of an active insurance license to do so. Planning, they said, was underway for the certification requirements, process and completion protocols, and the required classes would be available no later than early August.

At this point the timeframe was beginning to look a little tight, since the plans are scheduled to go on sale as of October 1, 2013 for a January 1 effective date.

June and July passed with no announcement of complete plan and cost details. The explanation given was that the release had been delayed until August due to “rate concerns.”

In early August, CoveredCA released a statewide rate summary reflecting costs for four sample plans (see pages 14 & 15 here), but nothing more.  Since that time, nothing more has been heard about rates or benefits.

Within days it was also announced that agents should pre-register for the certification classes.   August 19 was announced as the date on which agents would be able to register with CoveredCA and sign up for those new classes.

Unfortunately, when August 19 dawned the massive outpouring of agents trying to sign up for classes crashed the CoveredCA website, and few if any agents were able to get in without hours of hitting their web browser’s refresh button.  It was then discovered that in spite of previous assurances that the pre-registration would expedite the actual registration process for certification classes, it did not. Instead, all agents were required to redo their registration and wait for that registration to be approved before being able to actually sign up for certification classes.  To date – nearly three weeks later –  the vast majority of California agents are still reporting their registration process as “pending”.

With less than three weeks to go before the product goes on sale, rates and plan benefits are still unknown.

The bottom line:  CoveredCA, the self-proclaimed leader in the implementation of the ACA’s state benefit exchange sweepstakes has made little or no progress on the three key steps required to bring their product to consumers:

1 – Providing sufficient numbers of certified agents to help consumers buy the new plans

2 – Telling consumers and agents alike what the various benefit plans and plan options will actually provide in terms of benefits and coverage, and

3 – Letting everyone involved know the costs of the plans and how those costs will vary between multiple plan options.

We, as interested observers and potential clients, have two critical questions to pose:

1 – If California, the national leader, is this far behind where they promised to be and where they should be to have a viable, functional product available by October 1, how far behind the deadline are all the rest of the states and the federal government?

2 – If they’re this far over their heads in getting ready to sell these brand new plans to millions of people all over California, how ready are they going to be to administer, service, and satisfy those millions of people as customers once they sign up for coverage?

I, for one, have no great interest in becoming one of the guinea pigs in the beta testing of CoveredCA’s upcoming product launch. Do you?

california geographical features

A Well Regulated Militia


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With the recent resurgence of President Obama’s push for gun control, it is important to critically examine the meaning of the Second Amendment. This word “critically” is crucial here. It is often argued by proponents of gun control that the Second Amendment does not protect the individual right to own guns but instead protects the rights of the states (or the federal government) to maintain militias. It is true that the reason for which the “right of the people to keep and bear arms shall not be abridged” is that “a well regulated militia being necessary for the security of a free state”. Such an interpretation of the amendment, however, does not take into account the original context of the words and the intent of the “well regulated militia” clause.

In order to understand the original understanding of this clause, this article will critically examine two primary sources from the Founding era which served as the backdrop to the ratification of the Second Amendment.

As we all know, in 1776 British oppression had reached a breaking point in the American colonies. One of the primary examples of this oppression was the abuse perpetuated by British standing armies on American liberties. Virginia, specifically, had faced these difficulties with exceptional intensity. By June 1776, Lord Dunmore, colonial governor of Virginia, had threatened martial law, engaged in conflict with American rebels, and burned the city of Norfolk. Elsewhere in the colonies conflict with the British troops had reached the point of open rebellion and many Virginians were particularly outraged by the military rule that was imposed upon Boston at this time.

With this historical background, we can better understand the emphasis in favor of the right to bear arms and the fear of standing armies in Virginia in 1776.

On June 12, 1776 the Virginia Constitutional Convention adopted the Virginia Declaration of Rights, written by George Mason. This Declaration was influential on Thomas Jefferson’s Declaration of Independence and often regarded as a blueprint for the eventual United States Bill of Rights as a perusal of the document implies.

Section 13 of this document states: “That a well-regulated militia, composed of the body of the people, trained to arms, is the proper, natural and safe defense of a free state; that standing armies, in time of peace, should be avoided as dangerous to liberty; and that in all cases the military should be under strict subordination to, and governed by, the civil power”.

Let us take a moment to break this down. First, it is clear that standing armies ought to be avoided. This is not a declaration in support of simply having standing state militias. Whatever we are to glean from the rest of the statement must preclude an endorsement of standing militias. Second, we have a definition for a “well-regulated militia”, specifically that it is composed of “the people”. This wording certainly differentiates it from a standing army of government troops.  From these deductions, it can be concluded that the Virginia Declaration of Rights sought to protect the people’s ability to be trained in arms, rather than to support a standing government militia.

Let us continue our examination to another document, this time written by Thomas Jefferson himself: his draft of the Virginia state constitution. While this draft was not adopted by the state of Virginia it is an important insight into Jefferson’s own conception of rights. Jefferson was one of the most influential politicians in attempting to include a Bill of Rights into the Constitution, so his vision of rights gives a strong indication into the intent of the Bill of Rights.

Jefferson is unequivocal in his fear of a standing army: “There shall be no standing army but in time of actual war”. I have difficulty imagining another logical interpretation of this sentence. Furthermore, he is equally explicit in supporting a personal right to arms: “No freeman shall be debarred the use of arms [within his own lands]”.

A clever and perhaps skeptical reader will immediately latch onto both exceptions to a right to bear arms in this provision. More interestingly is his allowance that a freeman may be debarred the use of arms outside of his own lands. A compelling but irrelevant argument may be made that Jefferson allowed for instances where the use of weapons in public spaces may be prohibited.

Exceptions aside, Jefferson’s draft clearly protects the right of citizens to keep weapons in their homes, as he specifies the rights of arms within one’s own lands. Juxtaposed with such a fear of standing armies, we can deduce intent similar to that in Mason’s Declaration of Rights: that the possession of arms is a necessary check on the power of a standing army.

In the modern era we have a powerful standing army that stretches across the world. There is, of course, no provision in our Constitution against the existence of such an army, but there are a few major checks on the power of the military, such as the Third Amendment. The Second Amendment, taken nearly verbatim from the Virginia Declaration of Rights, and advocated for by Jefferson, whom we know to have supported the personal right to bear arms and opposed a standing militia, can now be understood better according to its original intention.

The “well regulated militia” clause can certainly not be construed as endorsing standing militias. Instead the Second Amendment ought to protect the freedom of an armed populace with the right to bear arms as a check on the military authority of a standing army.

Lexington Minuteman