If corporations are people, as Mitt Romney told a group today, then why aren't the companies caught defrauding Medicaid and Medicare in jail?
Romney's full statement, quoted in today's Huffington Post, is:
"Corporations are people, my friend... of course they are. Everything corporations earn ultimately goes to the people. Where do you think it goes? Whose pockets? Whose pockets? People's pockets. Human beings my friend."
"Everything ultimately goes to the people." That sure isn't the case with the big HMOs caught defrauding the taxpayers of billions of dollars intended to provide medical services to children.
I've asked before: if you were an employer and caught an employee stealing from you, would you hire that person again? And if you did and they did it again, would you hire them back a second time...a third time....?
Why is this any different from the Administration continuing to award federal subsidies to corporations already caught stealing from the government?
PR for the health insurance industry has done a great job fogging the mirror on Medicaid and Medicare. They have framed the entire debate in terms of the skyrocketing cost of medical care, the undeserving nature of recipients, and how the public budgets for these programs should be cut.
The problem is reality conflicts rather substantially with this PR "spin."
First, let's get the idea that Medicaid is for the poor or unemployed out of the way. Two-thirds of the national budget goes to keeping children and adults with disabilities, along with the elderly, out of institutions. Our country actually has a wonderful set of laws and regulations designed to keep families together, by providing medically necessary services in the individual's home. When the Medicaid budget starts getting cut, it's this two-thirds that is affected the most, and carries the highest human toll in misery and death.
Second, we need to remember that just because expenses are reported by insurance companies to federal authorities, doesn't mean those figures are accurate. The whistleblower case against Wellcare unsealed last summer reported expenses inflated by up to 299%. In Florida, investigators discovered Unitedhealth had billed the state for more than $2 million of speech therapy for children with disabilities that never took place.
Ironically, the insurance companies use these same inflated costs to justify premium increases in their state Medicaid contracts. In fact, the companies have to show they are losing money on the state contracts to get the rate increase. But if they were losing money in all the states that have awarded increases, how are they continuing to report record profits?
In its first quarter 2011 filing with the SEC, Wellcare said that "Hawaii program rate increases ... we believe have improved the stability of the program." With the company's operating profit jumping from 13.1% to 19.3% just in the past nine months, how much of the raise is being applied towards costs is in serious question.
Meanwhile, when PR flacks and industry reps talk about cutting provider rates, they forget to mention that doing so just increases the corporate HMO's profit margin. The HMO is not a "provider" in this lingo; it has replaced the state accounting and quality control bureaucracies with its own employees. The providers are the nursing agencies, pharmacies, hospitals, medical supply companies, day care centers for people with disabilities and other small businesses that provide direct services to the people needing them.
The biggest myth of all is that the issue that needs to be addressed is how to cut budgets. In essence, we are being asked to make decisions about cutting budgets without knowing how those budgets are spent. It might seem logical to equate Medicaid budgets with how much is spent on medical care, but that leaves out the twenty-to-fifty percent profit the HMO is scooping off the top of every payment they get from the government. Right now that totals somewhere between $2 billion and $5 billion a month, depending on how much fraud is going on.
As quietly as the government has been auctioning off Medicaid and Medicare to for-profit HMOs, the White House has taken steps to let these corporations know that federal regulators won't be watching too closely how these funds are actually spent.
On April 26, the Administration backed an agreement between Wellcare, nine states and the federal government, settling all the Medicaid fraud cases against them for $137 million. In return, the government agreed not to consider Wellcare a criminal and not to hold this non-criminal past against them in any future contract negotiations.
On May 6, the Administration published proposed new Medicaid access regulations that dropped jaws across Washington and the health reform movement. According to Sara Rosenbaum, Chair of the health policy department at George Washington University, "rather than being a forceful implementation of the law, the proposed rule is a model of inaction." She went on to call it "the first sign of the administration’s refusal to intervene" in state Medicaid practices, including those concerned with how government money is being spent. She calls the rule "a model of inaction," the sole remaining purpose of which is "to establish what might charitably be characterized as an information-gathering exercise."
Even this extremely watered down proposed law goes further by exempting everyone enrolled in Medicaid HMOs from inclusion in the five year information study.
Just from the year of statistics I took in college, I know any study that excludes seventy percent of the affected population has dubious accuracy.
Then on May 26, the White House took an action that could end up turning everyone receiving Medicaid into second class citizens. Defying HHS Secretary Sebellius as well as a number of health advocacy groups, Obama backed a "friend of the court" document submitted to the Supreme Court that advocates denying anyone on Medicaid the protection of federal law.
Simon Lazarus of the National Senior Center Law Center wrote:
The brief charts a path for the Supreme Court to permit federal courts to continue routinely to apply federal supremacy to strike down state laws protecting consumers, workers, retirees, bank depositors and others, alleged by business litigants to conflict with federal laws, while arbitrarily withholding identical protection from the vulnerable populations served by Medicaid and other safety net laws.
Rosenbaum warned in Politico that "there’s “no stopping point … in terms of its spillover effects” if the Supreme Court broadly restricts individuals’ access to the courts over state implementation of such a federal program."
If Romney thinks corporations are people, then Obama's actions tell us he values these corporations over the rights of the individual.
The country's most medically vulnerable population has been auctioned off to a bunch of criminal hoodlums with no regulatory strings attached.
Please sign our petition to stop this enslavement.
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