N.H. 1st New England state to make vaccine available for half, then later 2/3, of residents

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On Monday, March 29, New Hampshire became the first New England state to make at least half its population eligible for a COVID vaccine, according to an estimate by the Josiah Bartlett Center for Public Policy. Two days later, on the last day of March, it became the first New England state to make at least two-thirds of its population vaccine eligible.

In March, New Hampshire and Connecticut quickly accelerated their vaccine eligibility, trading places for the most rapid expansion. Connecticut made approximately 45.7% of its population eligible on March 19 when it allowed sign-ups for people aged 45 and older. New Hampshire opened registration for residents aged 40 and older 10 days later, then opened registrations for ages 30 and older on March 31. 

Since state vaccination programs began, they typically have been ranked by the percentage of their population that has been fully vaccinated. Another method is to measure the percentage for whom a vaccine is available. Both measures have problems, and both offer useful insights into a state’s vaccine rollout. 

The biggest problem with judging a state by the percentage of its population fully vaccinated is that state governments don’t mandate vaccination; their responsibility is to make vaccines available. 

Another problem is that a sizable, though declining, level of vaccine reluctance persists, particularly in more rural and Republican-leaning states, some data suggest. 

Measuring a state government’s success by the percentage of the population that got the vaccine is to give credit or lay blame in part for factors that are beyond the state bureaucracy’s control.

Judging states by the percentage of the population that has access to a vaccine could be a better measure of the state government’s distribution program. However, this measure also is affected by public behavior and demographics. 

If large portions of the earliest eligible groups decline vaccination because they are skeptical or fearful of the vaccine, that can make more doses available more quickly for later groups. If a state’s population is heavily skewed toward one end of the age spectrum, that will also affect the percentage eligible. 

New Hampshire’s median age is 42.9, almost two years higher than Connecticut’s (41). That gives New Hampshire an edge over Connecticut on this metric. But Maine’s median age is 44.7. Vermont’s is the same as New Hampshire’s (42.9). Rhode Island and Massachusetts are the youngest New England states, with median ages of 39.9 and 39.5, respectively. 

Another potential complication is that declaring eligibility is not the same as making the vaccine available. States can open sign-ups, but those are good only if the system is granting quick and easy access to appointments where vaccines are available.

Ultimately, states are responsible for creating a functioning distribution system that provides residents with the opportunity to obtain a vaccine. Once that system is functioning efficiently and effectively, states can encourage vaccination, but they do not conscript people into the vaccination program. 

That being the case, looking at the percentage of the population that has access to the vaccine can be a useful way of assessing a state’s competence in getting doses to people who want them. At this core task, New Hampshire has done extremely well. Sign-ups have proven relatively easy, wait times are not long, and vaccines are readily available for those who want them.

Though no state’s distribution system has been flawless, New Hampshire’s has managed to avoid major failures while providing relatively easy and effective access for eligible groups. 

By basing eligibility primarily on age, followed by vulnerability, the state has prioritized high-risk individuals while maintaining an uncomplicated sign-up system. 

Connecticut designed and maintained a similar priority system, based primarily on age and vulnerability. Both states have stuck with these systems amid criticism from some that race, ethnicity and income should be weighed more heavily. 

At the close of the first quarter of 2021, Connecticut and New Hampshire led New England in making vaccines rapidly available for most of the population. Other New England states have lagged weeks behind.

Connecticut’s vaccine eligibility remained at age 45 and older until April 1, when it became the first New England state to offer vaccines to all residents ages 16 and older.

New Hampshire ended March with vaccine appointments available to anyone 30 or older, with its schedule set to open vaccine sign-ups for ages 16+ on April 2, just one day after Connecticut.

Every other New England state is scheduled to expand eligibility to ages 16+ more than two weeks later, on April 19. 

Using U.S. Census data, the Josiah Bartlett Center for Public Policy estimated the percentage of each New England state’s population that was eligible for a COVID vaccine on March 31, the end of the first quarter of 2021. Based on the age groups that were being offered vaccines on that date, New Hampshire was in the lead, with 67% of its population eligible, followed by Connecticut at 45.7%, Vermont at 42%, Maine and Rhode Island at 25%, and Massachusetts at 23%.

In addition to prioritized age groups, states have made first responders and other “essential” workers eligible for vaccines. We used only age groups to estimate the vaccine-eligible percentage of the population because we did not have good data for dividing these workers by age.

Adding essential workers without adjusting for age would boost each state’s figures by a few percentage points, but adding those numbers without knowing the workers’ ages would double count many, if not most, of them, particularly in Connecticut and New Hampshire. 

Discrepancy between eligibility and vaccination rates

Becker’s Hospital Review ranks states by the percentage of the population that’s been fully vaccinated. On March 31, the New England states ranked by that metric were:

Rhode Island 20.7%

Connecticut 20.5%

Maine 19.31%

Massachusetts 18.5%

Vermont 18.4%

New Hampshire 17.1%

Why would New Hampshire rank first in New England in eligibility but last in vaccinations?

A likely reason is that a relatively high percentage of the population has reported being reluctant to get the vaccine. 

The most recent U.S. Census Bureau Household Pulse survey for late March found that 57.5% of Granite Staters who have not yet been vaccinated say they will do so. That is the 15th highest rate in the country. Yet it puts New Hampshire below every other New England state.

Looking into the survey’s data tables shows that 15% of Granite Staters said they definitely or probably would not get the vaccine. That is below the national average of 17.2%, but it’s the highest percentage in New England. Rhode Island is next at 14.3%, followed by Maine at 13.2%, Connecticut at 10%, and Massachusetts and Vermont tied at 7.4%.

Although New Hampshire has rapidly expanded eligibility, making the vaccine available to more than two-thirds of the population by the end of March, a relatively high portion of the state’s population, relative to the rest of New England, is reluctant to be vaccinated.

The importance of persuasion

And that brings us to a point the Josiah Bartlett Center made last year about the importance of building trust for public health measures. Regarding business closures and mask mandates, we cautioned that mandates and restrictions can backfire if they cut against public opinion. They can cause resistance, making it harder, rather than easier, to achieve public health goals. The first step in pursuing public health goals during a pandemic is to explain to the public why changes in behavior are needed.

In a democratic republic, persuasion is the primary political currency. Where people pride themselves in being free to live their own lives on their own terms, government dictates can backfire, causing resistance and making it harder to achieve desired goals. This is true in public health as in all other areas of public policy.

New Hampshire has done its job on the distribution end, making the vaccines widely available and easy to obtain. To get the vaccination numbers up, the state next should devote additional resources to persuading Granite Staters to get vaccinated. 

Mass vaccination is the path out of the pandemic. Though the state has made this point, the federal government’s conflicting messages have caused confusion and delay. A more energetic and high-profile state campaign to encourage vaccination would help bring up our vaccination rates and move us more rapidly back to normal, or as close to normal as we can get.

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Why are we still debating school openings?

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President Biden on March 2 announced a goal of administering at least one vaccine to every educator in the United States by the end of the month. The head of the American Federation of Teachers praised the announcement, saying, “vaccinations are a key ingredient to reopening schools safely.”

But that’s not true. 

A vast and growing body of scientific data show that schools are not major sources of COVID-19 transmission and that neither students nor teachers are at high risk of contracting the coronavirus in school buildings. 

We listed many of these studies when we wrote about this issue in January. In February, the Centers for Disease Control and Prevention issued guidance for safely reopening schools. That guidance listed three essential elements of safe reopening. Teacher vaccination was not on the list. It was included in a second list of suggestions for “additional layers” of prevention.

The New York Times summarized the CDC guidance this way: 

“With proper mitigation, such as masking, physical distancing and hygiene, elementary schools can operate in person at any level of community virus transmission, the guidelines state.

“The document says that middle and high schools can safely operate in person at all but the highest level of transmission, which is defined in two ways: when 10 percent or more of the coronavirus tests in a community come back positive over a seven-day period; or when there are 100 or more virus cases per 100,000 people in the community over seven days.

“Middle and high schools may open at any level of community spread if they conduct weekly coronavirus testing of students and staff members.”

The reason vaccination is not on the list of essential reopening elements is because 1) transmission in schools has proven to be very low, and 2) teachers as a group are not at high risk of infection. 

Aa we pointed out in January:

  • A British Medical Journal study of occupational risk by sector found that workers in the education sector had much lower risk of COVID-19 exposure than health care, medical support, and social care workers, and slightly lower risk than transportation workers. It should be noted that British public schools have mostly been open, unlike American public schools.
  • An occupational risk tool designed by the Vancouver School of Economics put Canada’s education sector in the medium risk category for COVID-19 exposure.

The evidence is so overwhelmingly in favor of school reopening that epidemiologists, infectious disease experts, doctors, and medical professors have been pointedly and urgently insisting that schools should reopen. 

They’ve even begun to publicly criticize teachers’ unions and politicians for ignoring the science in an effort to keep schools closed. 

Benjamin Linas, a professor of epidemiology at Boston University School of Medicine, wrote in Vox in February that he’s “losing patience with our teachers’ unions.”

Frustrated by the politicization of school openings, he wrote that “if educators and their unions don’t embrace the established science, they risk continuing to widen gaps in educational attainment — and losing the support of their many long-time allies, like me.”

On the same day President Biden announced that he would push for teacher vaccinations, The New York Times published quotes from a survey it conducted of 175 health experts regarding school openings.

“Over all, they said that data suggests that with precautions, particularly masks, the risk of in-school transmission is low for both children and adults,” the Times reported.

Among the quotes:

“We need to rely on science and not emotions to make these decisions. Expert guidance can get our children back to school safely. Keeping them out of school will result in irreparable harm to their education, particularly for minority children and those from lower socioeconomic backgrounds.”

— Archana Chatterjee, Dean, Chicago Medical School

“I wish that school reopening wasn’t subject to such politicization and fear, and that decisions could be made based on data and facts. Data would suggest that children, particularly younger children, can safely go to school, and that neither the children nor the teachers are at particularly higher risk.”

— Anne Blaschke, Associate Professor of Pediatrics and Pediatric Infectious Diseases, University of Utah

“This issue has been politicized, and the unions have inappropriately focused on fear and misinformation. San Francisco public schools could have been successfully reopened in August had the district, unions and others come together to support children.”

— Kim Newell Green, Pediatrician; Associate Clinical Professor, University of California, San Francisco

In Canada, the UK, Michigan, Southern California, Northern California, Colorado, and the United States as a whole, doctors have urged governments to reopen schools. The World Health Organization declared back in December that “schools can reopen safely.”

Yet it’s March and many students remain stuck in remote instruction for at least a portion of their school week.

All of New Hampshire’s neighboring states have moved teachers up the priority list for vaccinations, and there is some mild political pressure from the far left for Gov. Chris Sununu to do the same. This week, he refused, and stuck to his program to prioritize vaccines for the elderly and most vulnerable. 

Sununu’s position is quite obviously the correct one, as it’s the only one focused on protecting the most vulnerable residents first, and the only one backed by the overwhelming consensus of medical science. 

No major health organization has concluded that school personnel or students must be vaccinated before schools can open safely. No study has found that school personnel or students are at high risk of infection in schools. No study has found high rates of COVID-19 transmission in schools. 

The CDC recommendation that teachers be put into Phase 1b is not backed by any research showing teachers to be at high risk, and it contradicts the CDC’s February guidance that teacher vaccinations are not an essential element of reopening. The placement in Phase 1b is not based on risk, but purely on the classification of all educational personnel as “essential workers.” 

Of course, it goes without saying that educational personnel who are age 65 or older, or who qualify for vaccination because of underlying health conditions, are vaccine eligible already based on their risk.

There is overwhelming agreement in the medical community that schools can reopen safely with basic mitigation protocols in place, and that vaccinations for returning staff and students are not a necessary precondition for reopening. 

The medical debate is over, and has been for a while. All that lingers is a political debate that becomes further detached from reality with every passing week.  

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Schools can reopen safely, research shows

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“Our default position should be to try to keep the schools open and get children who are not in school back in school as best as we possibly can.”

— Dr. Anthony Fauci, Dec. 9, 2020

With the 2020-21 school year half over, tensions regarding school reopenings have reached new heights.

In Nashua, frustrated and angry parents are trying to recall school board members who oppose reopening the city’s public schools. 

The New Hampshire Education Association has demanded that teachers be classified with “high-risk first responders” and given priority access to limited supplies of COVID-19 vaccines.

News coverage, as usual, focuses on the politics rather than the data.

Stepping back from the drama and looking at the research, it is clear that reopening schools can be done safely, with little risk to students, teachers, staff, or the general public. 

In fact, that has been clear since the summer, when researchers at Johns Hopkins University pushed for schools to reopen. Anita Cicero, deputy director of the Johns Hopkins Center for Health Security, said that reopening schools “should be a national priority, and it’s much more important—immeasurably more important—than opening bars or restaurants.”

Regarding the risk to teachers and other school staff:

  • An occupational risk tool designed by the Vancouver School of Economics put Canada’s education sector in the medium risk category for COVID-19 exposure.

Regarding COVID-19 transmission in schools generally:

  • A Duke University study of North Carolina schools last fall “found extremely limited within-school secondary transmission of SARS-CoV-2” and found that “no instances of child-to- adult transmission of SARS-CoV-2 were reported within schools.”
  • A study published in Eurosurveillance, the European journal of infectious disease epidemiology, last spring found “no evidence of secondary transmission of COVID-19 from children attending school in Ireland.”

Regarding schools and community spread:

  • “The data so far are not indicating that schools are a super spreader site,” University of Michigan infectious disease expert Dr. Preeti Malani said during an Infectious Diseases Society of America briefing in October. 
  • A University of Washington Center for Education Data & Research study published in December found that school instruction models don’t affect community spread when community infection rates are not high. When community rates are high, in-person instruction with a large percentage of students in school was associated with some additional community spread. The study found that “there is no significant evidence that school systems offering hybrid instruction increases COVID spread.”

The research is increasingly clear that schools can be opened safely when standard precautions are followed. 

Importantly, this summary addresses only the risks of COVID-19 exposure, and not the numerous demonstrated negative effects of school closures on student well-being (see here, here, here, here, here, here, and here.)

Given the well-documented negative impact that school closures have had on students, and the low risks associated with reopening, it is evident that getting students back into classrooms ought to be regarded as an urgent need.  

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December set N.H. records for COVID-19 deaths, infections

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December was by far New Hampshire’s deadliest month for COVID-19 fatalities, with 233 recorded deaths, according to state data. That record high represents a 441.8% increase over November and a 32.4% increase over May of 2020, which recorded the state’s previous high of 176 deaths. 

The number of new recorded COVID-19 infections in December —23,034 — was more than double the total number of all recorded infections from March through November.

That huge increase in infections in just a few weeks indicates rapid and broad community spread of the virus. 

On Nov. 30, the state had tallied 20,994 total COVID-19 infections since the epidemic was first detected in New Hampshire. By December 31, the state had recorded 44,028 infections.

Total new infections in the month of November were 10,545. December’s 23,034 new infections represented a 118% increase over the previous month.

This rapid increase in infections and deaths is not unique to New Hampshire. December was the deadliest and most infectious month for the entire United States as well. 

As the Josiah Bartlett Center reported last month, the state’s hospitalizations figures are inaccurate, so we are not calculating a hospitalization total. 

The state officially listed an increase in total hospitalizations of only 63 for the month of December, an obviously incorrect number. The state went from 160 current hospitalizations on December 1 to 252 on December 15 to 317 on December 31. 

The large rise in daily numbers is not reflected in the state’s totals because the state does not include most hospitalizations in its totals.

The state’s official tally of total hospitalizations includes only people who were hospitalized when their COVID-19 infection was first recorded. Anyone hospitalized after the initial infection was recorded by the state shows up in the daily hospitalization count, but is not included in the total hospitalizations. 

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State figures undercount COVID-19 hospitalizations

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The COVID-19 hospitalization totals posted on the state’s website and given in its daily briefings are incomplete and do not include all hospitalizations, the Josiah Bartlett Center for Public Policy has determined.

The figure for total hospitalizations includes only people who were hospitalized when their positive test result was first reported, the Department of Safety’s Joint Information Center confirmed to Josiah Bartlett Center this week.

People who are “hospitalized after their case was initially reported” are included in the daily hospitalization updates, but are not added to the cumulative total for all hospitalizations, according to the Joint Information Center.

This results in a serious undercounting of the actual number of people who were hospitalized for COVID-19. In the first 17 days of December alone, the count is off by more than 100.

The state lists its cumulative total of hospitalizations on its daily updates as “Persons Who Have Been Hospitalized for COVID-19.” That number is the basis for the cumulative total on the state website.

The figure was 839 on November 30 and 877 on December 17, for an increase of only 38 hospitalizations.

But the number of persons hospitalized on each of those two days rose from 160 to 284, an increase of 124.

The discrepancy is caused not by hospital readmissions — people who were previously hospitalized being readmitted. It is the result of the state not adding to the cumulative total people hospitalized after their initial diagnosis.

The state should fix this discrepancy as soon as possible so the public has an accurate picture of the disease’s impact. Serious symptoms from COVID-19 can develop a week or two after contracting the disease. Not counting people admitted after their initial positive test result misses a potentially very large portion of COVID-19 hospitalizations.

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Mask mandates and the urge to control

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Portsmouth’s City Council approved a mask mandate on a 7-2 vote last week. The city had fewer than five known active coronavirus infections the day the ordinance passed, meaning more councilors voted for the ordinance than there were active cases in the city, NH Journal pointed out. The city still has fewer than five known active cases.

Manchester aldermen are considering a mandate that would carry an absurd $1,000 fine. City Health Department Director Anna Thomas told aldermen the point of the ordinance would be to educate the public about the importance of wearing masks. 

No, the purpose of a public relations campaign is to educate. The purpose of a mandate is to force compliance. The purpose of a fine is to punish.

Manchester Community College charges only $215 per credit. For $1,000, you could take a course in the Health Sciences curriculum, say, Probability & Statistics, learn more about the value of mask wearing, and still have $140 left over. 

Manchester’s COVID-19 dashboard, as of Friday, Sept. 25, shows only 39 known active infections recorded in the city of 110,000 people. Most of those infections are in people who live outside the city. Manchester has only six active in-patient hospitalizations. Not one of them is a city resident, according to the city’s own data.  

This is hardly the basis for an ordinance compelling mask wearing on penalty of a $1,000 fine. 

Last month, Hanover, Lebanon and Enfield passed mask mandates, as did Durham, despite having few recorded infections. Nashua, the first N.H. municipality to pass a mandate, last week updated it to require that businesses refuse to serve customers who aren’t wearing masks.

The new language forces employees to confront customers, even if no one else is in the business, and even if the employee is a teenager who might not have the training or confidence to engage in such a confrontation. 

After months of declining infections, hospitalizations and deaths, the urge to impose mandates on the population is growing rather than shrinking. Municipalities are pushing forward with new or expanded mandates even when presented with evidence that the large majority of people already wear masks. 

Nationally, 85% of Americans say they regularly wear masks when in stores or other businesses. A casual walk in downtown Manchester or a trip to any area supermarket is evidence that most people already wear masks when outside the house. 

The new municipal mandates typically require that masks be worn within six feet of someone else. Yet the World Health Organization recommends maintaining one meter (three feet) of distance. The British Medical Journal has suggested basing distancing on level of risk, with outdoor, less congested places needing smaller distance requirements. But municipalities are acting as if six feet of separation is an unbreakable law of science that is universally applicable to all situations. It isn’t.  

Mandates are blunt instruments. They don’t allow for nuance or for in-the-moment decision-making. And they explicitly preclude people from using their own judgment in any circumstances. 

With a mandate, individuals, not trusted to make a good decision at any time, have their judgment entirely replaced by the judgment of elected officials. 

And so we have Granite Staters being subject to fines for not maintaining twice the WHO’s recommended distance, even when outside in non-congested spaces where the risk of spread is low.

The state confirmed on Thursday that only one case of COVID-19 has been linked to Bike Week, and not a single case has been linked to any other large, outdoor gathering, including two Trump rallies and a NASCAR race. Multiple Black Lives Matter protests did not cause an infection surge in New Hampshire. But the public is supposed to believe that two individuals passing on a sidewalk within five feet, 11 inches of each other is a public health emergency? 

The Josiah Bartlett Center has, from the start, recommended voluntary mask wearing based on the strong evidence that it reduces the spread of the coronavirus. We also recommended a state public relations campaign to encourage mask wearing.

Mandates, however, are not the same as education. Education informs, but does not compel. A mandate compels. It is an extraordinary measure to be reserved for the most extraordinary emergencies. Subjecting American citizens to fines as a means of “educating” them is an abuse of government power. 

The coercive power of government is not a tool with which to fine tune people’s sensibilities. It is a last resort to be deployed when all other options are exhausted and the consequences of inaction are most dire.

Too many elected officials consider their temporary access to the levers of power an entitlement that permits them to replace others’ judgment with their own, whenever they feel like it. 

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A disease outbreak is a bad time to ban disposable plastics and paper

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Forcing people to carry reusable food and beverage containers in public could accelerate the spread of microbes that cause infectious diseases, multiple academic studies suggest, the Josiah Bartlett Center for Public Policy shows in a new policy briefing paper. 

As government strives to suppress the spread of the novel coronavirus, policymakers should immediately repeal laws, regulations and ordinances that ban disposable food and beverage containers, utensils and plastic straws. 

Attempts to ban “single-use” plastic grocery bags, water bottles and straws, as well as non-recyclable utensils and to-go containers, have spread worldwide in recent years. New Hampshire legislators make annual efforts to impose such bans or restrictions, and several municipalities already have banned plastic grocery bags. Concord, Mass., banned single-serving plastic water bottles in 2013.

As these bans were debated, concerns about public health tended to be dismissed, even though studies have shown genuine potential health hazards. This briefing paper outlines the public health reasons why policymakers should reject these bans.

The full briefing paper can be read here: JBC Disposables Ban Coronavirus.   

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How N.H. could save millions in drug costs with an online auction

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On Thursday, a coalition worthy of a wacky ensemble buddy comedy pressed the state not for a subsidy or a handout, but for something much more valuable. Labor unions, business leaders and mayors asked the state to use market forces to lower prescription drug prices.

The state hires a business called a pharmacy benefits manager (PBM) to handle its prescription drug purchases. PBMs negotiate with drug makers to determine what drugs are covered under insurance plans and at what price. Their formulas are complex and opaque, which has made them a ripe political target in recent years.

PBMs can reduce an employer’s or insurer’s prescription drug expenditures by negotiating volume discounts and managing efficiently a large volume of complex drug transactions. But an increasing number of studies (some summarized here) are finding that bad incentives and a lack of price transparency make it hard for customers to produce greater efficiencies and greater savings. 

The answer is to change the incentives in ways that empower purchasers, not sellers and contractors. 

New Hampshire hires its PBM by putting out a request for proposals and having a group of reviewers pick the best one. Last year it used this process to sign a three-year, $212.4 million contract with Express Scripts, one of the nation’s dominant PBMs. 

But there is a better way. Corporations and the federal government have for years employed an online reverse auction to force contractors to bid aggressively to win their business. It works sort of like eBay, but in reverse. The buyer starts the auction, and contractors place their bids. The auction then cycles through multiple rounds, with contractors having the chance in each new round to outbid each other. 

  • MIT marketing professor Sandy Jap found that online reverse auctions “not only save buyers money but also can increase the competitiveness of the supply base. Suppliers that participate in open-bid auctions are able to benchmark competitors and their cost structures, which can lead to greater efficiency for all suppliers.”
  • University of North Texas professors also found in 2004 that online reverse auctions “A large number of studies have demonstrated that ORAs not only improve the buyer’s purchasing efficiency, but also reduce its overall procurement costs” and that sellers “also benefit from new business opportunities to increase their sales.”
  • A 2011 study found that they drive prices down, create efficiencies, save time, produce real-time market pricing, and increase competition. 
  • A GAO report found that they may have saved federal agencies more than $100 million in 2016 alone. 

New Hampshire has the potential to save tens of millions of dollars by creating an online reverse auction process for awarding its new PBM contract next year. 

That’s what the wacky coalition on Thursday pressed the state to do. Public-sector unions and local elected officials correctly see the potential to lower their own drug costs too.

Prescription drug prices continue to rise because our complex web of laws and regulations prevents the creation of competitive marketplaces in which consumers can comparison shop. 

An online reverse auction takes a step in the right direction by employing market forces — not heavy-handed regulations — to reduce state prescription drug expenditures for the state and its employees.

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To fix health care, look to Milton Friedman, not Bernie Sanders

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Following the lead of a self-proclaimed socialist, on Tuesday and Wednesday the top Democratic candidates competing to lead the world’s most successful capitalist country diagnosed the source of America’s health care ills to be… capitalism.

  • Bernie Sanders: “…the health care industry makes tens of billions of dollars in profit…. If you want stability in the health care system, if you want a system which gives you freedom of choice with regard to a doctor or a hospital, which is a system which will not bankrupt you, the answer is to get rid of the profiteering of the drug companies…”
  • Elizabeth Warren: ““The basic profit model of an insurance company is taking as much money as you can in premiums and pay out as little as possible in health care coverage. That is not working for Americans…”
  • Kamala Harris: “Let’s talk about math. Let’s talk about the fact that the pharmaceutical companies and the insurance companies last year alone profited $72 billion, and that is on the backs of American families.”
  • Tulsi Gabbard: “So the core of this problem is the fact that big insurance companies and big pharmaceutical companies who’ve been profiting off the backs of sick people have had a seat at the table, writing this legislation.”
  • Kirsten Gillibrand: “The truth about health care in America today is people can’t afford it. They cannot afford — and the insurance companies for these plans that rely on insurance companies, I’m sorry, they’re for-profit companies. They have an obligation to their shareholders. They pay their CEO millions of dollars. They have to have quarterly profits. They have fat in the system that’s real and it should be going to health care.”
  • Julian Castro: “What I don’t believe is that the profit motive of big pharma or big insurance companies should ever determine, in our great nation, whether somebody gets healthcare or not.”
  • Bill de Blasio: “Yeah, I don’t understand why Democrats on this stage are fearmongering about universal health care. It makes no sense. Ask the American people, they are sick of what the pharmaceutical companies are doing to them.”

The Democratic Party is following the wrong Brooklyn-born Jewish immigrant. 

Tooting “The Internationale” on his pipe, Bernie Sanders is leading the Democratic Party down the dark path toward state control of the economy. His anti-capitalism rantings have shifted the party’s base far to the left. He led the health care debate on Tuesday, and on Wednesday Elizabeth Warren and others danced to his seductive tune.

Wednesday, as it happened, was the birthday of Milton Friedman, “the 20th century’s most prominent advocate of free markets.” Born in Brooklyn 29 years before Bernie Sanders, the Nobel laureate economist became famous for explaining to popular audiences how free markets combat poverty and empower the powerless, as he did here on Phil Donahue’s show.

Sanders’ progressive push for a government-run health care system is based entirely on the notion that health care and health insurance in the United States are controlled by for-profit companies preying upon citizens in an unrestrained free market. It’s an interesting theory, considering that exactly the opposite is not only true but demonstrably true. 

The United States does not have a free-market health care system. In a free market, a seller cannot raise prices with impunity. The existence of price signals and competition would allow consumers to choose alternatives, keeping prices down and service quality high. 

In health care in the United States, the government prevents this from happening. Because of a terrible tax incentive, consumers are locked into health insurance plans chosen by their employers. Those insurers negotiate prices with providers, and consumers have little say in that process. Additional laws prevent consumers from purchasing the lowest-cost insurance plans, instead forcing insurers to pay for routine health expenses and all manner of services that not everyone needs.   

In a classic essay written five years before his death, Friedman identified the structural problems with health care delivery in the United States. 

“Two simple observations are key to explaining both the high level of spending on medical care and the dissatisfaction with that spending,” Friedman wrote. “The first is that most payments to physicians or hospitals or other caregivers for medical care are made not by the patient but by a third party—an insurance company or employer or governmental body. The second is that nobody spends somebody else’s money as wisely or as frugally as he spends his own.”

“No third party is involved when we shop at a supermarket. We pay the supermarket clerk directly: the same for gasoline for our car, clothes for our back, and so on down the line. Why, by contrast, are most medical payments made by third parties? The answer for the United States begins with the fact that medical care expenditures are exempt from the income tax if, and only if, medical care is provided by the employer. If an employee pays directly for medical care, the expenditure comes out of the employee’s after-tax income. If the employer pays for the employee’s medical care, the expenditure is treated as a tax-deductible expense for the employer and is not included as part of the employee’s income subject to income tax. That strong incentive explains why most consumers get their medical care through their employers or their spouses’ or their parents’ employer. In the next place, the enactment of Medicare and Medicaid in 1965 made the government a third-party payer for persons and medical care covered by those measures.”

Is the raw greed of insurers and for-profit health care providers to blame for skyrocketing health care costs?

“A look at the data is instructive. The effect of tax exemption and the enactment of Medicare and Medicaid on rising medical costs from 1946 to now is clear. According to my estimates, the two together accounted for nearly 60 percent of the total increase in cost. Tax exemption alone accounted for one-third of the increase in cost; Medicare and Medicaid, one-quarter.”

Market-distorting government interventions — not greedy corporations — are the real drivers of health care and insurance costs in the United States, where about half of health care spending comes from government. 

“The high cost and inequitable character of our medical care system are the direct result of our steady movement toward reliance on third-party payment. A cure requires reversing course, reprivatizing medical care by eliminating most third-party payment, and restoring the role of insurance to providing protection against major medical catastrophes,” Friedman concluded.

That is the answer because removing those distortions is the only way to create largely efficient, functioning consumer markets in health care that empower consumers. 

That doesn’t require eliminating all regulations. We have functioning food and clothing markets that are subject to some level of regulation. It requires undoing the laws and regulations that deny consumers the ability to shop for health insurance and health care in a competitive marketplace.    

Friedman understood this and explained it well. But one party is choosing to follow Sanders and his nonsensical rantings instead. Maybe Friedman should’ve spent more time waving his arms and yelling.

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Arkansas’ Medicaid Expansion work woes shouldn’t kill NH’s experiment before it starts

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Just as New Hampshire begins monitoring its Medicaid work requirements this month, legislators consider a bill to kill those requirements.

Often cited as a justification for eliminating the work requirements is Arkansas’ experience in 2018. That year, 18,164 Arkansas Medicaid enrollees lost coverage after the state enacted work requirements. But a closer look at the Arkansas experience suggests that poor program implementation and design were the most important factors in the enrollment drop. 

In this Barlett Brief, we look at the reasons for the Arkansas enrollment drop and show that they do not justify killing New Hampshire’s Medicaid Expansion work requirement before it has a chance to succeed.

Find the full brief in PDF format here: JBC-Medicaid-work-requirement-brief.

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