“Don’t mess with my Obamacare” and the Fed’s inflation target June 26th, 2015 at 11:00 am Forgot to post a few pieces that went up at PostEverything in recent days. Health care, the Fed…you know…all fun stuff! Share the post "“Don’t mess with my Obamacare” and the Fed’s inflation target" FacebookTwitterShare… Categories: Federal Reserve, Health Care, New Posts | 4 Comments »
In watching our President, today; I was struck by a sad realization: What could have been….if given a chance by our Congress for the last 6 years. But no….each Congressman was worried about their next election, not we the people that erroneously elected them in the first place. REMOVE MONEY FROM OUR ELECTION PROCESS! By “Grace”, we saw, today, the man we elected 6 1/2 years ago.
The lack of logic on the right is crazy. There is no way to reason with people who think 2+2 is 3. Red states hate the big federal government all the way to the bank to deposit the net funds they get from it.
And inflation is low compared to 2%, which seems like too low a target given the fact that 10 year Treasury rates have been falling ever since they started targeting inflation at 2% decades ago. If the real rate of inflation for stable 10 year rates and your touted full employment is closer to 4%, then we are under by a long ways. Plus I don’t see how a 0.25% short term rate gives the Fed any significant room to fight a recession. I wonder how many times they will have to be forced back to the ZLB and need to QE before they reconsider that 2% target.
“…show up sick at the hospital, they must treat you; … To achieve comprehensive, affordable coverage without adverse selection (meaning too many expensive, sick people in the risk pool)…”
Since this has been the case for a long time — poor sick people utilizing the system in expensive and least health-ful ways pre-ACA — I’ve often thought that a lot of the really heavy costs were already in the system, and being compensated for by cost-shifting to the insured, and/or DISH funds (federal uncompensated care grants). When we insured a whole bunch more people through either Medicaid Expansion or subsidizing premiums, we would find that, low and behold, it actually did not cost more, maybe even less. In fact, the subsidies bring new money into the system: those too well-paid for Medicaid but too poor to pay premiums would now have the means to pay *something* toward their own health care/insurance, even if not much of it; previously that source of revenue was shut out of the system. DISH funds (which are being discontinued over the next few years) and shifted costs are now to be subsumed by directed funding to Expansion and subsidies.
Am I close to right, JB?
I think so…to me, you’re describing the basics of risk pooling and its critical role in cost control through avoiding adverse selection.