"If other eyes grow dull, other hands slack, and other hearts cold in the solemn trust, ours shall keep it well as long as the light and warmth of life remain to us.
"Let us, then, at the time appointed gather around their sacred remains and garland the passionless mounds above them with the choicest flowers of spring-time; let us raise above them the dear old flag they saved from dishonor; let us in this solemn presence renew our pledges to aid and assist those whom they have left among us a sacred charge upon a nation's gratitude, the soldier's and sailor's widow and orphan."
Here are two rich discourses by Oliver Wendell Holmes, well worth reading today, and remembering for days and months to come.
1895: The Soldier’s FaithMemorial Day history and information
1884: In Our Youth Our Hearts Were Touched With Fire
Ed Partridge's notes on how to display our flag
Special Session Today
The Special Session should start around 2:00 p.m. Listen live at www.le.utah.gov
Circumventing the Process
Senator Sheldon Killpack
Co-Chair of the Health and Human Services Appropriations SubcommitteeSenator Lyle Hillyard
Co-Chair of Executive Appropriations
In the course of the 2006 Legislative Session, the Health and Human Services Appropriations Subcommittee heard countless requests for the funding available. They spent long, sometimes heartbreaking hours carefully prioritizing competing requests. Medicaid dental didn’t even make the list.
Now, somehow, it’s on the special session agenda.
Utah is unique in the fact that every legislator has the opportunity to sit on an appropriation sub-committee. Some legislators have the distinct opportunity to sit on the Health and Human Services Sub-Appropriation Committee. Many will argue that this is by far the most difficult committee on which to serve because you will simply never be able to meet everyone's needs.
Because human needs are so desperate and the resources are limited, the PROCESS becomes key in deciding what is funded and what is not funded.
Prior to the past legislative session we learned that – due to inflation, case load growth, changes in Federal funding, and utilization - we needed over sixty million dollars to keep programs whole as they already existed. During the session we learned that the Feds were going to deliver twenty million less
than we anticipated for the 2007 fiscal year and 10 million less for the 2006 fiscal year for the Department of Human Services.
The committee spent several meetings listening to testimony from department heads, advocacy groups, industry leaders, and state and local leaders (not to mention six hours of public testimony). What resulted was a prioritized list of needs that was passed along to the Executive Appropriations Committee.
To their credit our priorities were funded pretty much in the order the committee placed them.
However, many of our priorities were not funded at the level we hoped and some items were not funded at all.
Many worthy programs compete for the same funding. The following state needs were all prioritized ABOVE the Medicaid optional dental program:
Which one of these programs are less important than Medicaid dental?
- Mental Health funding,
- Ongoing additional funding for the medical examiners office,
- Utah Birth Defects Network,
- Additional DCFS caseload workers,
There certainly needs to be some rationale we can explain to advocates of other programs as to why they should not all try to short circuit the legislative process.
In some areas the very basics of the Medicaid program are in trouble. Providers are becoming leery of giving assistance to Medicaid patients because the reimbursement rates are so low. Increasing payment to providers was a priority to the committee - a higher priority than dental - but it was not funded.Weighing and comparing competing priorities is incredibly important.
There is a line a mile long of other optional Medicaid programs that did not get funded. It is bad policy and bad precedence to circumvent this process.
This would have been a bit more palatable had the Governor’s office given us any indication that this was important to them during the legislative session.
This move must be incredibly frustrating to those who play by the rules.
Vicente Fox, President of Mexico, will address the Utah State Legislature in Joint Convention, Wednesday at 11:00 a.m.
Most local news outlets will cover the event. You can also watch (or listen) live on-line by going to the www.le.utah.gov
Security will be tight. In fact, only legislators, reporters and other specifically cleared individuals will be allowed into the West Building tomorrow morning. The northeast and northwest corners of the Capitol Plaza are been reserved for the public, but you’ll get a better view by staying home and watching it on TV (or by tuning in to our live streaming audio/video
around 11:00 a.m.).
Out of Context
"Believe nothing merely because you have been told it.... But whatsoever, after due examination and analysis, you find to be kind, conducive to the good, the benefit, the welfare of all beings — that doctrine believe and cling to, and take it as your guide."
— Siddhartha Gautama (c. 563-c. 483 B.C.)
That said, one of the funniest, best new blogs out there is Out of Context
, from the Trib's cadre of political writers.
We’ll grow to hate this blog, eventually, but for now it’s on the must-read list.
Special Session Wednesday
Dual Tax Rate?
By Sarah Wilhelm, PhD
Fiscal Policy DirectorVoices for Utah Children
Tax policy objectives, which are widely accepted as sound criteria for a good tax system are:
- Revenue Adequacy
I appreciate the work of good people trying to generate sound tax policy. It's just a matter of time before we find the magic bullet that works for everyone.
However, the proposed dual tax system fails to improve any of these criteria over our current system. A dual tax system that allows a taxpayer to chose which tax system is most beneficial will make the system more complex, will jeopardize revenue adequacy, make the system less transparent, result in unequal treatment, with increased costs of compliance and administration. Such a system will also not achieve the stated goals of tax reform, to stabilize funding for education and lower the states top marginal rate.Simplicity
The dual system will increase the compliance costs for tax payers as they will have to calculate their tax liability under both systems, or pay someone to do it, to determine which system is the best for them. The tax commission has already indicated having a dual system will be more costly to administer. Legislatively maintaining two tax systems will be twice as difficult as economic situations, state priorities and federal laws change.Revenue Adequacy
The dual tax system will make projecting revenue much more difficult. Revenue projections are more likely to be inaccurate making budgeting more difficult. Utah currently has an excellent track record in projecting revenue for the future enabling the Legislature to create budgets with minimal corrections. The cost of the plan will also negatively impact the states ability to adequately meet educational funding needs.Transparency
The dual system obscures transparency. It will no longer be clear which income is subject to tax and which protected or rewarded with credits and deductions. Depending on which system you choose for the year in question you could have large variations in potential individual liability and state revenue. The dual system would obscure what was happening with state revenues until after legislative decisions would be required to be made.Equity
Those in identical situations could be taxed very differently. Equity would require that similarly situated taxpayers be treated similarly. The flat tax system would provide a substantial tax cut to those making over $250,000, whose effective tax rate* averages 5.45%. They would now be able to pay 4.8% under the flat tax system. Currently those making over $280,000, the top 1% of taxpayers, pay the least percent of their income in state and local taxes compared to all other income groups. Providing a tax cut to the wealthiest 1% would make Utah’s currently already regressive tax structure even more regressive and further push the burden of funding the states education system onto those in the middle class.Efficiency
The dual tax system could magnify the effect of the tax system on economic behavior. For example, a taxpayer who has a change in their mortgage interest deduction may change to the flat tax system thus changing the costs of donating to charity, adopting a special needs child, and purchasing an alternative fuel vehicle. In addition, a duel system would be inefficient to administer, and would increase compliance costs as individuals spend more time, effort and money to determine which system would allow them to minimize their tax liability under a given set of circumstances.
* Effective tax rate is the percentage of your total income you pay in taxes. If your income is $100,000 and you pay $5,000 in taxes, your effective rate is 5%. The effective rate can be very different than the published or marginal tax rate due to deductions and credits. In a pure flat tax system with no deductions, the marginal rate, the published rate and the effective rate would all be the same.
Measure twice, cut once
By Dan Eastman
Senate Majority Whip
Problems with the new bifurcated system for tax on food are multiplying.
A few examples:
- The negative impact on retailers, especially mom and pop shops in rural Utah;
- The escalating cost of compensation for retailers forced to retool their systems;
- Lack of comprehensible definition of what is and is not “food”;
- Unclear policy on the bundling of “food” with non food items;
- Shaken confidence in the numbers to the point we don’t know the price tag is really $70 million;
- A higher price tag would damage transportation, health and human services, and other General Fund priorities;
- We don’t know the extent of all the negative impacts. Unforeseen problems continue to come out of the woodwork.
This is poor policy and we should have known better. After some careful discussion in caucus today, the Senate Majority voted in support of a six-month delay (giving the new bifurcated food tax policy a start date of July 1st).
This will give us time to clarify the fiscal note and to start fixing the unintended impacts and consequences.
Why hurt people when we don’t have to? Why rush into a poorly-thought-out policy decision when we are not ready to mitigate the damage?
15 kilobytes of fame
By Peter Knudson
Utah Senate Majority Leader
Last week's Stateline.org
article, by Kavan Peterson, directed some extra attention to the Senate Site. Here are a few comments (deserved or not) from our shipmates sailing the New Media Sea:
"Talk about variety. The Utah Senate has a blog that one day has pols and citizens squabbling over how to spend a $1 billion surplus, and on another suggests that lawmakers head for the Senate freezer because it is packed with Aggie ice cream, courtesy of Utah State University."
"For real! They’re blogging and actually have citizen commentary! We need some more of this. The “Unofficial Voice of the Utah State Senate Majority” is a bold step that more legislative bodies should be taking."
"When I think of Utah, the first thing that usually comes to mind is "legislative blogging." Naturally then, Utah's state Senate became the first legislative body to have its own blog."
A Capitol Blog
"Interaction and greater communication is certainly the idea the Utah Senate had when it started the Utah state Senate's blog. It was started as the unofficial journal of the state Senate Republican majority. Did you hear that Texas? Yes sir, you heard that right - blogging Republicans."
"What makes this blog work is what makes every blog work in the end: writing that interests people, openness, and a human voice. This isn’t a collection of press releases. These are posts by real people, explaining in their own words why they’re doing what they’re doing."
Shades of Blue
"Now HERE'S a trend I'd like to start!! Wouldn't this be interesting? Hmmmm - bringing the people's voices directly to their legislators and vice versa. Might be illuminating for both ends..."
"Legislative blogs are adding their presence to the rapidly growing blogosphere."
"Joining the nation’s growing proliferation of political Web logs, or blogs, the Utah site was the first of its kind to strike up a digital dialogue that included entries not just from state Senate Republicans but also from minority Democrats and lawmakers in the opposite chamber. Unfolding comment by comment, the unofficial daily log often paralleled official debate taking place under the dome - with the added bonus of anonymity."
Well, we appreciate the thoughtful comments, but are very aware that we have much to learn - and that we've only just begun to tap the potential of these new technologies. These are uncharted waters for a legislative body, but we hope we’re adding something of value to the democratic process.E-mail us
or post a comment
anytime. In the final analysis, this blog site belongs to you - the citizens of our great state. We hope this site becomes an avenue for more and more people to participate in our legislative process.
We'd love to hear your insight and suggestions for sailing these waters.
Reforming Tax Reform
By Curtis S. Bramble
State Senator, District 15
"Rumors of my death have been greatly exaggerated."
- Utah Tax Reform, 2006
We need tax reform, but first we need to reform how we obtain and analyze the numbers.
We need to re-work how we forecast state revenue and predict the fiscal impact of proposed policy.
One thing we can, and should, do immediately is implement an effective peer-review process among our economists and fiscal analysts. The Governor has agreed to add a bill to next week’s Special Session agenda that would give legislative economists and the Governor’s Office of Planning and Budget access to essential data that is currently only available to the Tax Comission.
More eyes on the numbers should cut down on error.
The purpose of tax reform is stable, predictable long term funding that will rescue our education system over the next few decades. We still need to do it. The discussion continues, but no one will be trying to close the deal until the legislature, the Governor, and the general public can trust the numbers.
Glen Warchol got it right again
in today’s article.
I appreciate the vision, and the blood, sweat and political capital, that has been spent by so many in the reform effort. A dual system is the latest innovation
, and it may have some promise. I have concerns, but I’m also intrigued. I think it’s worthy of discussion.
At the very least it shows that good minds continue to experiment to find a workable solution.
We'll talk more about this in tomorrow's Revenue and Taxation Interim Committee
meeting. Stop by, if you can, or listen live
on-line. We'd appreciate your input.
Session on the Mount
New Senate Murals
By Al Mansell
Utah State Senator, District 9
In the old Senate Chambers of the Utah State Capitol Building, on the north wall, behind the Senate President’s chair was a landscape mural of Lake Utah.
When the legislature moves back to the Capitol for the 2008 Session you will see that landscape again, plus two new murals high on the east and west walls.
The Senate Murals Selection Committee has decided one mural should represent the stunning southern regions of the state with red sandstone arches, indigenous art and the enormous western blue skies. The other will focus on the beautiful valleys and mountains of Northern Utah, featuring fruit orchards in full blossom framed by the snow-capped peaks of the Wasatch Range.
In this way, the cumulative effective of the three murals will pay a sweeping tribute to the people and landscape of Utah – north, central, and south.
The Capitol Preservation Board is currently accepting resumes and portfolios of qualified artists.
If you need information, please contact Judith at the Capitol Preservation Board: 538-3074. Do not contact any member of the senate - artists that lobby will be disqualified.
The Capitol, ultimately, is your building.
We hope you will like the new décor!
This is interim week. You can find the calendar here
Two new blog sites deserve a mention…NCSL
has a new site called The Thicket
, “by and for legislative junkies,” about the legislative institution and federalism.
In case you missed it, Vern, Pat, Malin, Marilyn, George, Paul, and Ringo of the Trib's Editorial Cadre have taken the dive into the blogosphere. Read Welcome to the Cave
and check out their blog
as posted in the Salt Lake Tribune:Republican State Convention
Democratic State Convention
- U.S. Senate Nominee: Orrin Hatch (inc.) 78%; Brian Jenkins 16%; Mike Ridgway 5%; Ronald Levine 2%
- 2nd Congressional District Nominee: LaVar Christensen 84%; Kris Lounsbury 10%; Joe Tucker 6%
- 3rd Congressional District Primary Election John Jacob 52%; Chris Cannon (inc.) 48%; Merrill Cook (eliminated first ballot)
- State Senate Dist. 11 Nominee: Howard Stephenson (inc.) 77%; Dave Hogue 23%; Dist. 12 Nominee: Christy Achziger 68%; Dan Tuttle 16%; Dist. 18 Primary Election Dave Thomas (inc.) 51%; Jon Greiner 49%; Dist. 24 Nominee: Darin Peterson (inc.) 75%; Ryan Smith 22%; Jay Collier 3%; Dist. 26 Primary Election Kevin Van Tassell 56%; Dave Ure 44%
- State House Dist. 20 Primary Election Paul Neuenschwander 52%; Ronald Mortensen 48%; Dist. 70 Primary Election Kay L. McIff 56%; Gordon Topham 44%
- State Senate Dist. 12 Nominee: Brent Goodfellow (inc.) 78%; Millie Peterson 22%; Dist. 26 Nominee: Roland Uresk n/a; Laird Fetzer Hamblin n/a
- State House Dist. 25 Primary Election Christine Johnson 55%; Josh Ewing 45%; Joel Briscoe, Chris Ferguson and Jack Gray (eliminated first ballot)
Listen to Senator McCain's address (KCPW)
Cannon, Jacob in Republican runoff (Daily Herald)
Sen. McCain visits Utah (D News)
McCain's cross-country trip stops in Utah (Trib)
Phil Windley's pictures and commentary (Technometria)
Political Conventions Held Today (KSL TV)
Democrats' Convention more a rally (Trib)
Just one Demo primary (D News)
Cannon forced into a primary (D News)
More Convention Results (D News)
By the Dawn's Early Light . . .
The Utah State Republican Party Convention will be held tomorrow at the South Towne Expo Center.
Several Senate races
will be in play (Districts 11, 12, 18, 24, and 26). If you are involved in those races, you should be in Exhibit Hall 4
It's hard to nail down exact times at these conventions, but the proposed agenda
will give you an overall picture.
Some additional information is on line here
Governor Huntsman and Senator McCain will begin to address the convention around 2:25 p.m.
Reporters seeking credentials for the event should contact the Convention Media Relations Director, a.k.a. Eric Isom, at (801) 824-0173.
See you there!
Mexican President Vicente Fox
We're not positive, but this might be the world's most concise press release.
From the Governor's Office
May 11, 2006
Legislature to convene for Mexican President Fox
Salt Lake City - Governor Jon Huntsman announced today he will be calling the Utah State Legislature into a Special Session May 24.
On that day Mexican President Vicente Fox will be addressing a Joint Convention of the Legislature.
“We look forward to hearing from President Fox on this most historic occasion,” Governor Huntsman said.
# # #
We'll post the details here on the Senate Site as the event approaches.
Utah Blog Maestros Educate PR Professionals
, Phil Windley
, and Bruce Fryer
spoke to a gathering of the IABC/PRSA and passed along some excellent information:
How to start a blog
Robert Scoble’s Corporate Weblog Manifesto
Some del.icio.us bookmarks
From Fryer’s post
The key message was being honest and speaking with a human voice. There was some confusion about knowing if it was correct to start a corporate blog. My point being if your company was interested in packaging and promoting a product and selling it to consumers, you shouldn't blog.
If you were interested in establishing a relationship with your customers and building loyalty between you and them, then yes, start a blog. It's a great tool.
The way I view it, blogging is a never ending cocktail party on the Internet with the most interesting people you will ever meet.
Skull Valley Deadline
By John Valentine
President of the Utah SenateToday is the deadline for public comment
on the proposed – and aptly named – Skull Valley nuclear waste storage site.
Please write your letter and get it postmarked today. You may also send a fax (801- 977-4397) or E-mail (email@example.com
Here’s mine. Feel free to make it yours too.
(Special thanks to Senator Hatch, Governor Huntsman, the DEQ
, Howard Stephenson
, Congressman Matheson
and the Utah blogging community
for providing helpful information.)
Bureau of Land Management
Salt Lake City Field Office
2370 South 2300 West
Salt Lake City, Utah 84119
Re: Private Fuel Storage Proposed Lease and Right of Way.
Dear Ms. Schuller:
I would like to add my voice to the rest of the citizens of the state of Utah, in opposing the proposed site of an intermodal transfer point on BLM land on the North side of Interstate 80 near Timpie, Utah.
Although I share the grave concerns expressed by many Utahans about the so called “temporary storage” in Skull Valley, I am particularly concerned about this proposed site on BLM land and its attendant rights-of-way.Road Issues and Safety Concerns
Casks of hazardous spent nuclear fuel will be stored in plain view of I-80 while awaiting onward transportation to PFS’ storage site in Skull Valley. Waste-castes would be transferred to huge slow-moving trucks which would then proceed at 20 MPH under I-80 and along the Skull Valley Road to the proposed PFS site. This situation presents an open invitation for terrorist attack. No security provisions have been identified by PFS and no known emergency plan is in place. This is unbelievably irresponsible and creates an unacceptable environment for officials responsible for the safety of motorists, and residents.
I am also concerned about the height problems with proceeding under the freeway and the load carrying capacity of the Skull Valley Road. The road was not engineered or built to handle the heavy loads required by these waste trucks along this route. I understand these transports are 150 to 180 feet long and 12 feet wide, making normal wide-load trucks look small by comparison. SR 196 is a narrow two-lane public road varying from 20 to 24 feet in width, often without a shoulder.
An additional safety concern is that Skull Valley Road is the main route to Dugway Proving Ground, and is one of three emergency evacuation routes for the chemical weapons incinerator in Tooele Valley. What happens when an emergency mass evacuation is necessary and the road is blocked by huge trucks carrying nuclear waste? This very possible scenario would be comical if it weren’t so absolutely disastrous and tragic.
The off-load point on land over which BLM has stewardship would be located on the mud flat/wetland area of Stansbury Bay of the Great Salt Lake. This area has standing water during flood years which should further disqualify this site for its proposed use.Pony Express Resource Management Plan
I understand that the BLM’s Pony Express Resource Management Plan for this specific area states,
“Public land will not be made available for inappropriate uses such as storage or use of hazardous materials (munitions, fuel, chemicals, etc.) and live artillery firing.”
I anticipate the BLM will exercise fidelity to its own RMP and deny the permit sought by PFS.
The Federal Land Management Policy Act (FLPMA - BLM’s organic statute for managing public lands) directs that in
“designating right-of-way corridors and in determining whether to require that rights-of-way be confined to them, [BLM] shall take into consideration national and State land use policies, environmental quality, economic efficiency, national security, safety, and good engineering and technological practices.”
FLPMA further directs that each right-of-way permit contain terms and conditions to protect Federal property and economic interests, protect lives and property, and otherwise protect the public interest in the lands traversed by the right-of-way or adjacent to them.
PFS is a shell company. It has no independent assets. There is no decommissioning plan for the intermodal facility, nor any requirement for funds to be set aside to deal with accidents, abandoned casks, etc., at the proposed intermodal facility or the rail corridor. PFS’ ridiculous “plan” for dealing with leaking casks is to ship them back over the proposed right-of-way to the nuclear power plant!
Given the requirements of the Pony Express Management Plan, the directives of FLPMA, and PFS’s fundamental inability to mitigate danger or guarantee safety, the BLM must deny the application for a transfer point and right-of-way across these lands.Department of Defense Study
Our congressmen report that in 2005, BLM officials said that agency approval for the rights-of-way would not be given until the Department of Defense has studied the impact of any such land-use changes on nearby military facilities. This study is required under Section 2815 of the FY2000 National Defense Authorization Act. To date, the Department has not yet begun its study. Therefore, I believe the BLM is prohibited from amending its Pony Express RMP and granting the rail-spur right-of-way until the study is finished.Cedar Mountain Wilderness Area
The National Defense Authorization Act for Fiscal Year 2006, Section 384, created the Cedar Mountains Wilderness area, which encompasses a portion of PFS’ proposed rail route, makes it impossible for PFS to construct a continuous rail route to the Skull Valley Indian Reservation. The Wilderness Act prohibits any commercial enterprise, permanent or temporary road, mechanical transport, or structure or installation within a wilderness area. Therefore, any BLM right-of-way permit to run a rail corridor through Cedar Mountain Wilderness Area would be illegal.
Because this quiet and wild area of the state has been designated a public use area, people are beginning to discover these mountains and make full use of the space. Hikers, campers, hunters, fishermen, explorers and tourists should not have the close presence of high-level nuclear waste hanging over their heads. Public recreation and the presence of a high-level hazardous waste facility are fundamentally incompatible public land uses.Temporary Facility?
The PFS’ public proposal for Skull Valley anticipates 20 years (40 years if they reapply) of utilization. However, no one familiar with the nuclear politics believes the waste will ever be taken elsewhere. PFS is, in effect, proposing a permanent safety hazard, terrorist target, economic curse, and public lands impact, while only providing the particulars for a very temporary facility. The scope of the PFS proposal is inadequate to account for or even describe the realities of the impact to the land over which the BLM has stewardship.Conclusion
Allowing a shell company with no way of mitigating damage to conduct an unneeded, extremely hazardous activity is not a beneficial use of public lands.
The transfer point and right-of-way is poor policy, poorly conceived, fundamentally unsafe, and clearly illegal.
Given the realities of these and many other concerns you must deny the proposed transfer site and right-of-way across public land.
I appreciate the ability to make public comment on this important issue.
John L. Valentine,
President of the Utah Senate
Tuesday’s Deseret Morning News - front page, above the fold - announced “a political compromise is in the works
” on tax reform. Their report was echoed on KSL
and other news outlets.
This has happened before.
Remember the tense negotiating days toward the end of the 2006 Session? At one sensitive point in the process, the D News rushed to give their readers the impression that a compromise agreement was imminent when no agreement ever existed
(only a House member’s proposal that never caught fire.) *
So, history repeats itself.Glen Warchol got it right
A new proposal is great. This place runs on a steady stream of new ideas. It means smart, responsible people are working hard to find something that works.
But to proclaim legislative leadership has a “political compromise,” when it’s really just a few House members and executive branch staff brainstorming a new approach, stretches the bounds of credibility. Again.
* The real compromise agreement of 2006 came about several days later - thanks to hard work, careful negotiations, and unreasonable patience on all sides. The agreement was announced to all media outlets at the same time.
Lightning Rod, Part II
Time for some answers
By Senator Gene Davis
Democrat, Senate District 3
I am posting here today because of the recent articles that I have read regarding the increased costs of healthcare; consolidation or merges among the insurance industry has tended to monopolize the market place.
Senator Wadoups and I have had discussion about these issues. As the Privately Owned Health Care Task Force begins it’s second year of looking at our health care system. We believe it is time to investigate the competition and exclusion of providers in our system.
When more and more individuals are losing coverage or have to meet astronomical first pays or co-pays just to see a doctor to receive medical attention then something must be done. The healthcare system is broken and part of the problem is patient choice and access to affordable healthcare. We think there is a role for all providers.
What are the factors behind the double-digit healthcare inflation?
What are health insurance contracts predicated upon?
Why is the cost of health care so high?
Is there any kind of conspiracy between the insurance industry and some providers?
We need answers and so I am joining with Senator Wadoups in calling for an audit and investigation into these issues on both the Federal and State level.
More Important Than Money, Part II
By Michael Waddoups
Utah State Senator, District 6
The insurance industry made approximately $100 billion in profits this past year. A major study by the AMA, reported in the Dow Jones Newswire
Consolidation among health insurers is creating near-monopolies nationwide, with the most dominant players grabbing more market share by several percentage points per year.... The AMA study used a Department of Justice benchmark, called the Herfindahl-Hirschman Index, to gauge the level of market competition. A score above 1,000 shows "moderate" market concentration, while a score above 1,800 is considered "highly concentrated".
According to the study, 95% of the 294 markets under scrutiny were “highly concentrated,” with scores above 1,800. 67% scored above 3,000.
The Wall Street Journal
has recently reported on the CEO of United Healthcare, which is now under SEC investigation (and who enjoyed a compensation plan of over $1.6 BILLION over the last decade).
Here are two paragraphs from the investigative report:
Dr. McGuire's story shows how an elite group of companies is getting rich from the nation 's fraying healthcare system. Many of them aren't discovering drugs or treating patients. They're middlemen who process the paperwork, fill the pill bottles and otherwise connect the pieces of a $2 trillion industry.
The middlemen credit themselves with keeping the health system humming and restraining costs. They're bringing in robust profits-and their executives are among the country's most richly paid as doctors, patients, hospitals, and even drug makers are feeling a financial squeeze. Some 46 million Americans lack health insurance.
These special interest groups have big law firms, powerful lobbyists and seem to only care about profits.
Once again, living in America means you can take ownership of your society, community and living conditions. Are we willing to live with the system we have allowed to evolve? I believe it is time to insert some responsible supervision into the model.
Elected officials should be the voice for working families, small business and employers who are being hammered by escalating energy costs, runaway insurance premiums and double digit healthcare costs.
It is time to say that enough is enough.
More Important Than Money
Utah State Senator, District 6
As chair of the Privately Owned Health Care Organization Task Force, I have spent two years scrutinizing the state of our healthcare system in Utah and in the United States.
The process is like watching a train wreck about to occur.
I have read several recent stories regarding the CEO of United Healthcare and how this insurance company is being investigated by the SEC.
A study by the American Medical Association confirms that health insurers are consolidating market power to the point that they are a virtual monopoly in many areas of the country.
Additionally, I have heard complaints from constituents about a lack of choice in selecting their physicians and where they can receive desperately-needed health care.
They feel they are treated like a number.
Employers are telling me that they cannot deal with the never ending increases of insurance premiums.
And, disturbingly, I have seen examples of what I consider predatory practices of insurance companies and some hospital systems to get rid of competition.
Who will stand up to a system like this? Political freedom means you chart your own destiny. You decide the type of society in which you are willing to live. Are you willing to live under the health care system, as it currently exists?
Some of my more cautious friends have counseled me that it is impossible to stand up to big, powerful industries. I have been pressured to back off. People felt that way about Enron and look at what happened. I have reached the point where I can no longer be silent.
I am in the process of formally communicating with Congress, the Department of Justice, Federal Trade Commission and Health and Human Services. I am calling for state and federal investigations of the business practices of the insurance industry and hospital systems in Utah and in the United States.
I have also met with Utah's Department of Insurance and our Attorney General about potential violations of antitrust provisions in our consumer protection laws. I believe there is evidence that these two large powerful interest groups (the insurance industry and hospital systems) are putting profits before people and that their actions are hurting employers and working families.
Specifically, I believe we have serious problems in the following areas:
- Business practices at insurance companies and hospital systems similar to what the SEC is investigating at United Healthcare;
- Potential collusion between insurance companies and hospital systems to prevent competitors from effectively competing against hospitals;
- Legitimate claims payment issues which hurt consumers; and
- Potential violation of Utah consumer protection laws.