How the US Postal Service Could Possibly Save Itself

Posted on May 13, 2013 | Leave a comment

Just last week the United States Postal Service announced another $1.9 billion loss in just one quarter, with the warning that without substantial changes the losses would continue to mount.  Something has to give.

Retired from the Postal Service, I have some ideas on what needs to be done to save this Constitutionally provided institution, and a new line of clothing, mentioned several months ago, does not even make my list, nor do I think elimination of Saturday delivery alone would be sufficient.   During my career I carried mail, worked inside a large postal plant, and collected data for a year.

It was that year of collecting data that foretold today’s inevitable crisis.  The year was 2000, and at that time as I remember, first class mail was less than half the letter mail volume but more than half total postal revenue.  The problem was that, of that first class mail, somewhere around 70% consisted of bill presentment and payment.  The writing was on the wall.  Much less bill presentment, bill payment volume has evaporated to the internet and will continue even more.  This was one major straw that broke the back of a camel already straining under what the postal service failed to recognize early on, that the business was becoming about the delivery of things rather than information.  Other substantial problems contributed to the current situation, but the loss of quality volume sufficient to sustain delivery to every delivery point six days a week was an inevitable result of new information technology and beyond the post office’s control.  Simply cutting the workforce and utilizing a heavy application of sorting automation, in many ways commendable, could not keep up with the deteriorating situation.

Political considerations put cutting several known sources of waste beyond reach that could have delayed, but only delayed, the current crisis.  One example, but certainly not isolated, happened near where I live.  Two small towns that appear as one are separated only by a railroad track.  Each had its own post office with its own postmaster and staff, and unfortunately still does.  One town outgrew its office.  Since the two towns together are smaller than many single towns, the opportunity was perfect to build one new office large enough to accommodate both.  I’m not sure if this was even suggested, but am confident, if tried, the local congressman would have been besieged with calls from one of these adjacent towns about losing its identity or the hardship of having to travel perhaps a half mile further to reach the new combined office.

Another common well-known waste that politics preserves occurs in suburban neighborhoods that originally had mail delivered to a box attached to the house or through a slot in the front door, rather than a box at the curb.  In such situations the carrier drives to the area, parks and walks to each house, then moves the vehicle to the next area, over and over.  Yet by all appearance such neighborhoods are identical to others where curbside boxes were required from the start, and delivery from the vehicle is several times more efficient.  Private businesses looking at the current postal challenges would quickly change this, but under the political connection no one dares to even try.

Unions are another obstacle to efficient operation in ways other than wages that exceed the skill level.  Removal for poor performance or abuse of leave is extremely  difficult.  The workplace is fractured into crafts, each represented by its own union, so employees of one craft may not touch the equally low skilled work of another.  At one time this could work, simply not today.  One would think when workers at some plants, willing to work many hours of available overtime, can earn in excess of six figures, there would be concessions to overall efficiency and responsibility to secure the remaining jobs of all.

That brings us to today with the postal service looking to cut Saturday delivery to keep itself afloat.  This is attempting to put a band-aid on a gaping wound, and will be difficult to manage as well, as every Monday will follow two non delivery days and will be like the current volume anomaly of Tuesdays after Monday holidays.  Of course there will still be Monday holidays and those Tuesdays will now be after three consecutive non delivery days, what I can only imagine as a volume-overload management nightmare.

With that we get to the only possible solution I can conceive, the immediate move to three-day M-W-F delivery.  While each delivery day volume would increase, it would be more manageable by being more consistent day-to-day.  Such a move would mean adding carriers as some routes would have to be cut slightly (but not nearly by half) to get the job done.  Savings would be attained by cutting the use of delivery vehicles substantially.  The other significant savings would require a major change of workplace rules where carriers not delivering express mail and priority parcels on Tu-Th-Sa would be working in plant preparing mail for delivery, replacing work being done by clerks and mail handlers now, eliminating many of those positions.  Consideration would have to be made to occasionally deliver on Tu-Th-Sa in working around holidays.

Proposed plans are to continue delivering parcels six days a week and I would assume express mail also.  Most offices could do this job with one of every three or four current carriers, leaving the others to work in plant.  Limiting six-day parcel delivery to priority rate parcels would encourage greater use of the higher priority rate.  For letters considered urgent there already is a flat rate express letter option that does not require a time-consuming signature.  Out of the box thinking and a willingness to be flexible with current workplace rules and a decidedly more radical approach is necessary to potentially continue the US Postal Service as a self-sustaining entity in the twenty-first century.

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Posted in Business, National Politics, Politics

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Unsavory Observation in PA Budget Hearings – Let’s Fix This….and More

Posted on March 14, 2013 | Leave a comment

I must be one of those Wacko Birds.  Sometimes in the middle of the day I watch Pennsylvania’s version of C-SPAN, PCN-TV, carrying the riveting excitement of live committee hearings in our state legislature, but then I watched bowling on B&W TV as a kid.  While watching recent House Appropriations Committee budget hearings I made a rather unsavory observation.  Names have no purpose or importance here, because unsavory emanated from both parties and seemed to be part of the process, just business as usual.

What bothered me were pleas to the committee to reinstate appropriations to non-profit organizations in the private sector and/or increase their funding more than it had been.  This is my money.  While I don’t entirely think it is wrong for government to assist non-profits, especially if it can be demonstrated that the actions of the non-profit save the taxpayer money or have a valued function that is better administered in the private sector, direct assistance through taxation takes not only my money but my choice.  Picking and choosing with other people’s money creates wars for contributions that should exist but not inside the halls of government.

It would be much better and much cleaner if all government assistance to non- profits was based on the School Choice EITC model, an indirect approach to assistance.   This model returns voluntary choice to individuals or corporations or tax paying groups as it should be, by allocating pools of potential assistance that would only be paid as tax credits in return for voluntary contributions competed for in the private sector.  Cleaner still would be if tax credits were less than full reimbursement, say 75% to 85% of the donation amount, leaving a portion squarely on the shoulders of the contributor, as any reimbursement still is other people’s money and this would prove true intent rather than a scheme to merely pass through public funds.  Any non-reimbursed amounts would still be eligible as a deduction on federal returns.

Large highly valued needs, such as education scholarships to attend charter or private schools could stand alone with their own appropriated fund.  Smaller more numerous non-profits could compete from a common pool appropriated for the potential benefit of any.  Strict value and need standards would have to be met to be allowed into the pool of potentials.  Proof of economic benefit to the taxpayer or extreme social need should top the list.  Perhaps legislators should vote individually for non-profit inclusion on common lists among those that pass independent screening.

Of course any such funds, single purpose or multi-purpose, must have caps to protect the taxpayer and otherwise budgeted revenue.  From there it would be first come first served to obtain the available credits.  This restores valuable elements of true charity while eliminating the unsavory sight of legislators publicly begging on behalf of any specific non-profit organization for the money of others perhaps against their will.  It also effectively isolates and quarantines useful efforts, voluntarily embarked upon by people of vision, from the entanglement of government, with its regulations and rules and departments and bureaus and employees and unions and pensions and all ancillary issues it invariably brings with it.

EITC for education has been a great success for helping deserving students avoid failing schools.  Sometimes incentives for desired voluntary efforts could take forms other than tax credits.  Such would be the case with an act like NJ Senate No 2231, that would replace government entanglement in Medicaid by granting immunity from civil malpractice liability in all their practice to physicians and dentists who agree to donate at least 4 hours per week in a non-government free clinic, a wonderful concept that could so attract participation that there would be a shortage of available free clinics.  Since this approach has been predicted to hold potential for both huge savings to the taxpayer and better access to higher quality health care for the poor, the EITC model could then be employed, with a dedicated fund of tax credits limited in size only by attracting enough voluntary contributions for a sufficient number of free clinics, themselves independent of any government ties.  Because of substantial predicted net savings to the state by bypassing Medicaid, extending whatever voluntary credits as necessary to assure every willing physician the needed resources would be entirely warranted.

It’s not hard to see how, in many respects, this approach to getting desired things done is revolutionary and refreshing.  I can’t imagine it would be that hard to address my unsavory observation and not only fix it but head down a new path that would better respect freedom while benefiting us all.

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Posted in PA Politics, Pennsylvania, Politics

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The Insidious Non-Optional Medicaid Expansion That Further Clouds the Future for States

Posted on March 4, 2013 | 1 Comment

So much about Obamacare has been “by any means necessary”, from the legislative gymnastics to get the bill through Congress to the current mandatory expansion of Medicaid that is here now even though largely unnoticed.  Here now?  But wasn’t Medicaid expansion optional?  Some yes and some no as it turns out.  This almost unknown stealth expansion was required of the states and imposed on them despite the Supreme Court ruling because it is being funded 100% by the Federal Government, but only for two years 2013 and 2014, after which, funding abruptly ends.  Because a strong constituency is being created (or bought) that will demand this expansion be continued past 2014, and no one can predict the outcome of those likely demands, further possible complications and risks arise for those states that decide to embrace the optional Medicaid expansion.  Allow me to explain.

Because of current constraints to participation by medical professionals both by low reimbursement rates, 1800+ pages of cumbersome rules, and audits that go beyond financial fraud to interfere in actual treatment decisions, there are at present not enough willing doctors to adequately serve those now eligible for Medicaid benefits.  Realizing this, and attempting to avoid making the optional expansion to 133% of poverty and influx of new eligibles a disaster, “any means necessary” was once again deployed.

On November 6, 2012 (surprisingly not a Friday) CMS published a Final Rule to go forward.  146 primary care Medicaid services identified by the ACA would, by regulatory proclamation, be compensated at the higher Medicare rate, starting with 2013 but only for two years.  Since Medicaid reimbursement rates relative to Medicare reimbursements vary tremendously from state to state, the percentage increase covered by Federal funding varies accordingly.  At one extreme are two states that surprisingly pay higher Medicaid fees for the covered services than they do for Medicare.  These states will receive no additional Federal funding.  At the other extreme is Rhode Island, where Medicaid fees will increase 198%.  Five other states will receive boosts of over 100%.  Pennsylvania is number seven on the list and doctors will be compensated an additional 96% to equal the higher Medicare rates.  On average across the nation Medicaid fees for the ACA primary care services will rise 73% at an estimated cost of $11.9 billion, all in an attempt to keep willing physicians on board, expand their willingness, and attract newcomers.

The problem, of course is what happens after 2014.  It is unimaginable that doctors enjoying the higher reimbursements for two years will do anything but lobby stridently to extend the increases and indeed have them made permanent.  Realizing, otherwise, the carrot to participation would no longer exist, this outcome can be considered probable.  The mystery is who would then pay?  Would the increase be included in the ultimate 10% state funding under optional expansion to 133% of poverty or even some formula that would require states to pay more? Would the increases fall to each individual state or be averaged over all the states?  The point is that today no one knows.  While perhaps not being the main reason to avoid the optional Medicaid expansion, especially those states with the greatest percentage “temporary” increases need to consider the possibility of very serious consequences in the aftermath of this two year attempt by the Federal government to buy a loyal constituency for implementation and avoidance of massive failure.  It is also interesting that the current reimbursement increases were only applied for two years, as estimates for the cost of Obamacare have been made over a ten year period, allowing more, for now, to remain hidden from view.

The two main sources used for this post were a policy brief from the Henry J. Kaiser Family Foundation and an article in American Medical News published by the American Medical Association.  More details can be found at these two locations.  Also used was a recent article written by the President of the Texas Medical Association.

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Posted in Healthcare/Insurance, National Politics, PA Politics, Pennsylvania, Politics

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Every State Not Expanding Medicaid (and those that do) Needs to Do THIS — ASAP!

Posted on February 26, 2013 | 3 Comments

Pennsylvania is fortunate to have a governor who has made bold choices in opposition to Obamacare by both declining state insurance exchanges and the more difficult, but entirely correct, refusal to expand Medicaid, but it can’t stop there.  Governor Corbett and all non-expansion states need to explain why their decision was correct and promote alternative solutions asap, or lose the battle for public perception as Democrats are painting the Governor and the GOP as standing against the poor and caring only about the rich, despite it not being true.

Last week on PCN-TV, a Pennsylvania version of C-span,  State Senator Vincent Hughs was practicing his art of indignation by trashing the Governor on Medicaid expansion and demanding to see the figures on Governor Corbett’s fiscal concerns.  He also posted a response on his website.  Senator Hughes seems to have the idea that adding more free stuff from others better off can never go wrong, and because we would in the end retain 90% Federal funding, that Federal money somehow materializes from thin air, rather than from the pockets of people in the states, including Pennsylvanians.

For the benefit of Senator Hughes, and to his credit, we should look at numbers, and outcomes and realities as well, being sure to consider everything we know and leaving indignation, hubris, and emotion at the door.  If Senator Hughes would approach the debate in such fashion and the GOP would learn to articulate their message and promote detailed solutions and alternatives to Medicaid expansion we may find places where we can agree, and even discover ways to provide better care for the poor at less cost to the taxpayer.

Without too much detail, Medicaid is a mess.  Low reimbursement rates that don’t cover costs keep many physicians from participation entirely and must limit the number of eligible patients seen for those who do.  For others a different cost is too great, best summed up in this quote from an article written by the President of the Texas Medical Association, Dr. Michael E Speer :

“Texas physicians are also discouraged from accepting new Medicaid patients because of the program’s 1,802-page rulebook and exasperating, irreconcilable red tape. We need to return to treating the patient, not the administering bureaucrat.”

These constraints to participation create rationing by waiting time, length of visits, and lack of availability to care that result in the much higher cost of seeing non-emergency cases at hospital emergency rooms.  After all it’s better to wait 6 hours to see someone than 6 days or 6 weeks, and those facing such choices cannot be blamed for doing what they perceive is in their best interest.

All this has numbers attached too that Senator Hughes and those deriding the Governor’s decision should be equally interested in seeing as well.  Ask any doctor.  Medicaid patients often fare worse than patients without any insurance.  Expansion of eligibility will do nothing but increase the waiting times of those already attempting to find access from too few professionals who can afford to offer it.  Coverage clearly does not equate to care.  Also, expansion to 133% of poverty forces more people into Medicaid because only  those over 133% will be eligible for subsidies in exchanges.  Many additional people toward the upper end of the 133% will be be forced to drop private insurance they now have to join the ranks of the current overextended Medicaid mess.  Senator Hughes and others, is this what YOU want?

We must look to better ways to provide for our poor, not extend a system of failure.  Various alternatives to providing for the poor have been tried, some with much success and satisfaction.  Successful innovations have been tried in Indiana, Florida, and Rhode Island.  These involve empowering the poor with ownership via their own special accounts or insurance policies that have incentives to choose services wisely.

Perhaps the single best idea I’ve seen comes as a bill that has been introduced in the New Jersey Senate that uniquely looks at a partnership between state government and private charity.  Senate No. 2231, also known as the “Volunteer Medical Professional Health Care Act”, is a brilliant idea that should cross party and partisan lines with appeal to anyone who seriously wants to provide better access at lower cost along with less government involvement and control.

Very simply, New Jersey Senate No. 2231 would grant any physician (primary care or specialist) or any dentist who agrees to volunteer at least 4 hrs per week in a non-government free clinic, immunity from civil liability through the entirety of their medical or dental practice in the state.  These physicians would not need to purchase malpractice insurance and be freed from oppressive Medicaid regulations and scrutiny, creating an almost irresistible incentive for many more physicians to participate than are willing to commit to Medicaid.  Medicaid would never be involved or ever billed for any of this service.  The New Jersey chapter of the Association of American Physicians and Surgeons (AAPS), who inspired the legislation has estimated New Jersey could expect to save $2 billion of a $10.2 billion Medicaid budget or close to 20%, while offering more timely and much better care for those they see.   AAPS itself was inspired by the vision of two members, Drs. Alieta and John Eck, who responded to the needs of the poor and their concerns over the pitfalls of Medicaid by starting a free clinic in their hometown, Zarephath, NJ,  in September of 2003, thus will enjoy their 10th anniversary this year.

Governor Corbett in Pennsylvania and other Governors who courageously declined to expand Medicaid made the right choice and need to stick to it.  Opponents need to open their eyes to existing realities, and all need to come together to find better solutions such as S-2231 in New Jersey as well as others.  AAPS has informed me that similar legislation may soon be introduced in UT and AZ.  It is not enough to decline Medicaid expansion and then do nothing, while being falsely painted as uncaring by those with insufficient understanding.

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Posted in Healthcare/Insurance, National Politics, PA Politics

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Before Sending Drones Against Americans Abroad

Posted on February 13, 2013 | Leave a comment

Much has been said lately critical of killing Americans without the benefit of due process.  While it can be tempting to disregard the rights of those who have turned on their country and/or acted in consort with an enemy, there should be a process, a due process, to clear the way for what may also be regarded as the justified assassination of turncoat citizens plotting against us and posing threats from beyond our borders in places also beyond the possibility of extradition.

One way to do this may be a process to bring charges of Treason in Absentia against those on whom we have sufficient evidence of treasonous activity abroad.  Those so indicted by a Federal grand jury would be given a clear choice.  Either return to United States territory within 30 days and surrender to authorities to then face treason charges here, or immediately be stripped of all rights and citizenship.  Those who then willingly fail to face charges here, having surrendered all rights could, at that time, be put on a kill list and treated as any enemy.

I present this as a solution where an executive order is clearly not sufficient yet hesitation to act on a situation is not either.  Citizens must know there are severe consequences to tying themselves to a foreign enemy abroad, and such actions can and will jeopardize their rights, citizenship, Constitutional protections, and even their life.

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Posted in Constitutional Protections, Due Process, National Politics, Politics

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Resisting Obamacare and Confronting the Dangerous “Other” Complicity – There IS a Way Out

Posted on December 10, 2012 | 5 Comments

With the deadline for states to convey their intentions on Obamacare exchanges to HHS only days away at this writing, much attention is centered on what they will do.  It is possible that half the states will decline to participate leaving the Feds alone in a task some think may not go well.  The point that the States have the option of participation cannot be lost.  The crafters of Obamacare were in some ways cognizant of the limits of Federal power and, thereby, sometimes reliant on willful submission and complicity to achieve their goals.  In the past few weeks I’ve discovered that exchanges were not the only situation where Obamacare recognizes its potential limitations vis-a-vis the states, opening the door to the potential for significant new legal non compliance options.

On November 29 I received an email from Donna Rovito, fellow Pennsylvanian, National leader in  healthcare freedom issues, and founder of the Lehigh Valley Coalition on Healthcare Reform.  It included a link to a Citizens’ Council for Health Freedom (CCHF) page featuring commentary from its president Twila Brase.  Her topic was a section of Obamacare that drew notice of at least one attorney at the Goldwater Institute.  It’s found in Subtitle G – Miscellaneous Provisions, specifically Section 1555 which reads:

“No individual, company, business, nonprofit entity, or health insurance issuer offering group or individual health insurance coverage shall be required to participate in any Federal health insurance program created under this Act (or any amendments made by this Act), or in any Federal health insurance program expanded by this Act (or any such amendment), and there shall be no penalty or fine imposed upon any such issuer for choosing not to participate in such programs.”

The question raised was whether Section 1555 leaves individuals the right to opt out of Obamacare or is restricted to issuers of insurance, accepted as understood.  I hope to show why this distinction is of minor concern.

Only a few more pieces of this puzzle need to be considered to understand its importance, mostly falling under the heading of what I’ve been calling the “other” complicity.

The other complicity is the unchallenged acceptance of Obamacare coverage mandates and regulations into policies as they even now exist before the exchanges are set to begin.  This would include everything that defines how health insurance must look, from the phony deceptive “no cost sharing” first dollar mandates (including “free” contraception) to the age 26 requirement and bans on exclusion of preexisting conditions, from minimum loss ratio requirements to actuarial value restrictions and more.  All this defining by the feds is in a direction 180 degrees from anything that makes sense and will add hugely to health insurance premiums within the exchanges.  Michael Cannon at the blog Cato @ Liberty just presented some stunning information on the magnitude of these premium increases.  We are looking at 30-40% and in some cases more.

While the Federal Government may be able to define the parameters of insurance within Obamacare there still exists a world outside, separate and apart, or at least there can and should.  That world is the authority and responsibility of the states to regulate insurance sold within its borders granted to it by the McCarran-Ferguson Act of 1945.  Under McCarran-Ferguson insurance was exempted from Federal anti-trust law and its regulation was left to the states, and remains in effect to this day.  There is nothing about Obamacare that strips states of this right and insurance companies cannot claim that they are bound to participate in the dictates of Obamacare, as Subtitle G-Section 1555 makes clear they are not.  Insurance companies were given the choice to partcipate, but states, through their insurance departments, and the authority of McCarran-Ferguson, reserve the right to require the continuance of non Obamacare compliant health insurance outside the exchanges, no matter what form the exchanges take.  So long as states do NOT go for the purchase of health insurance across state lines, they have the defense, even in the face of the modern skewed interpretation of the Commerce Clause, to keep it this way.  States must see Obamacare not as an imposition upon them but as a federal program layered over them for those who want it.  They hold the keys to the maintainance of the availability of sensible health insurance policies, outside the federal program, firmly in their hands.

States, by using the authority they have, can even require a movement to true high deductible insurance where everything covered conforms to the deductible, among its choices outside Obamacare, thus setting the stage for many to pay the tax for non participation in the exchange, purchase sensible real insurance outside it, stash money into a HSA, and still have money left over in the end.

My take is that Obamacare is so reliant on willful complicity as to be a paper tiger that only gets teeth that are handed to it.  All of the above along with the adoption of Healthcare Freedom measures as 17 states so far have, will determine how far states will permit the federal power grab that is Obamacare to go.  A tradition of states exerting those powers they have needs to be rekindled, and there is no better time than now, on this issue, to do it.

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Posted in Healthcare/Insurance, Politics, States Rights

I Want to be Thankful for My Governor – An Open Letter to Tom Corbett of Pennsylvania

Posted on November 20, 2012 | Leave a comment

Honorable Tom Corbett, PA Governor

Governor Corbett, this holiday season I want to be especially thankful for my governor.  Governors are uniquely positioned to defend and protect a prime reason why America has thrived as it has.  The concept that in the United States a predominance of power would remain with the States and the People was central to our founding.  Violations of this concept are yours to resist and defend your state’s citizens against.  The notion of state and individual sovereignty in America must be fought for under any circumstances forever.

We currently stand at a point of decision.  Obamacare is upon us.  When I called your office and raised these Constitutional and Founding issues your staff agreed in theory, but then went straight to a strange position of passivity, an acceptance that Obamacare is inevitable.  I was even told that “come 2014 Pennsylvania will have an exchange”.  Governor Corbett this is not the kind of leadership I am looking for.  Yes, how setting up Obamacare exchanges will affect the finances of the state is an important consideration, but overriding that is Obamacare’s assault on freedom.  As Attorney General you brought PA into suits against this Federal power grab.  Where will you be now with things you still can do to protect us?

In the last few days two highly instructive articles have appeared on why states should refuse to set up exchanges.  One comes from Michael Cannon at the Cato Institute.  Another, written by James Capretta and Yuval Levin appeared in the Wall Street Journal.  Both suggest that the 30 Republican governors can gum up the works of Obamacare by simple legal acts of non-complicity.  Neither suggests any advantage for states or their citizens by setting up exchanges even if they ultimately become a reality.  Questions remain if the law itself provides the framework to be implemented without the cooperation of the states.  Almost 35 lawsuits remain to be decided.

Governor Corbett, the Federal Government has extended the deadline for states to make their decisions on exchanges and Medicaid expansion to December 14.  Twenty-one other states, so far,  have said they will not be setting up exchanges.  A majority of states standing in opposition is very possible.  According to the two articles I cited sufficient disruption may ensue to at least delay Obamacare if not cripple it.  Development of and having at hand alternative market based reforms, such as those suggested in other posts on this blog, may then find an opportunity to at least be demonstrated.

Governor Corbett, this is a time that requires exceptional courage.  By taking the side of freedom and liberty, on December 15 I will be able to say that I am especially thankful that you are my Governor.  Say NO to Obamacare Exchanges and the expansion of Medicaid also.  Thank You!

Happy Thanksgiving Sir

Todd Keefer

PA citizen and writer of FreeMktMonkey.com

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Posted in Healthcare/Insurance, Open Letters, PA Politics