Photograph by Patrick T. Fallon/Bloomberg

Dental work performed at a free health clinic for the uninsured and underinsured at the Los Angeles Sports Arena.

The cost of health care in the U.S. is rising at the slowest pace in four decades, helping curb inflation.

The consumer-price index dropped 0.4 percent in April from the prior month, a second consecutive decrease and the biggest since December 2008, figures from the Labor Department showed today. While that was due to a decrease in gasoline — prices at the pump slumped 8.1 percent last month — there was more going on beneath the surface.

Health care, long the culprit behind sustained gains in inflation, is now showing much more modest price increases. Medical expenses were little changed in April, the first time without an increase since July 2010. Taking it out a few decimal points actually showed a 0.02 percent drop, making it the biggest decline since November 1975 – just goes to show how rare even such small declines are.

Over the past six months, medical care costs were up 0.9 percent, the smallest advance over a similar period since March 1972.

Medical commodities, the term used by economists at Labor to describe things such as prescription drugs and stethoscopes, got the ball rolling when those prices peaked late last year. They were 0.7 percent cheaper in April than in August, the biggest eight-month drop in records going back to 1967.

More recently, medical services — everything from visits to your dentist and ophthalmologist to nursing-home care and hospital stays — is following suit. The cost of hospital care, for example, fell 0.7 percent in April alone, the biggest one-month drop ever.

The reason for the turnaround will require additional reporting. The consequences for fiscal and monetary policy, though, may be easier to establish.

Should it continue, it will help bring down the federal budget deficit by curbing entitlement programs including Medicare and Medicaid.

It may also influence Federal Reserve policy makers who are trying to spur growth and prevent inflation from dipping too far. Medical care accounts for about 17 percent of the Commerce Department’s personal consumption expenditure price gauge excluding food and fuel, according to Eric Green, an economist at TD Securities in New York. That’s more than twice as much as in the consumer-price index.

The Commerce Department’s gauge is the one tracked by the central bank to determine what to do next, i.e. step on the gas pedal if it’s too low or take your foot off the accelerator if it starts to pick up.

Using today’s CPI data, economists at Morgan Stanley in New York project the Commerce Department’s figures, which will be released at the end of the month, will show the core PCE index rose 1 percent over the past 12 months, the smallest year-to-year increase since records began in 1959.

The Fed’s stated goal is to keep inflation over the longer term at around 2 percent. Do I hear QE3 anyone?

Original post is Health Care Costs Slow: Inflation Curb by Political Capital.

Photograph by Kevork Djansezian/Getty Images

Former first lady and Secretary of State Hillary Rodham Clinton speaks with her husband former president Bill Clinton as they attend the opening ceremony of the George W. Bush Presidential Center on April 25, 2013 in Dallas, Texas.

Bill Clinton says it’s a waste of time to speculate about his wife’s ambitions for 2016.

“That is the worst expenditure of our time,” the former president said today at a 2013 Fiscal Summit sponsored by the Peterson Foundation.

Hillary Clinton, the former first lady, senator from New York and secretary of state, is taking a role at the Clinton Foundation, writing a book and “having a little fun being a private citizen for the first time in 20 years,” he said.

Focusing on presidential politics just six months after President Barack Obama’s reelection “obscures our capacity” to take on the big problems, he said. It also “plays to our national tendency to attention deficit disorder when it comes to politics.” It’s important not to “get off on to politics too early.”

Clinton was joined at the forum today by Bill Gates, the Microsoft co-founder and co-chairman of the Bill and Melinda Gates Foundation, who joked that he doesn’t think his wife is running for president. “Hillary hasn’t mentioned it to me either,” Gates said.

Gates, in an interview with Bloomberg Television before the summit in Washington, said his fellow wealthy Americans should pay more as the U.S. grapples with reining in its budget deficit.

“There’s no doubt that as you look at balancing budgets to the degree you need more revenue” that lawmakers will need to look to the wealthy “to get a little bit more from them proportionately than you get from people as a whole,” Gates said. “I think that’s pretty likely.”

Clinton also had this to say about Obama’s 2010 health care law, with major provisions still taking effect this year. “We really need about five years to see if the drivers in the health-care law” work, he said, “to see if that works.”

Original post is Bill Clinton: Hillary 2016 Speculation Waste of Time by Political Capital.

Photograph by Brendan Hoffman/Getty Images

Stickers in English and Spanish are available for voters at the Martin Luther King, Jr. Memorial Library on November 6, 2012 in Washington, DC.

President Barack Obama has taken at least one good page from George W. Bush’s book.

He knows how to go around the Washington media.

Obama, however, has taken it a step further.

He knows how to go around the English-speaking media.

At 2:25 and 2:40 pm EDT today, the president will sit for back-to-back interviews in the Blue Room of the White House first with Univision and then with Telemundo — the leading Spanish-language television networks.

This is the president who won 71 percent of the Hispanic vote in November, and who is pressing for a comprehensive overhaul of the nation’s immigration laws.

It isn’t only immigration, however, that appeals to the Spanish-speaking electorate. It’s also health care — as Jim Messina, Obama’s 2012 campaign manager and now chairman of the Organizing for Action not-for-profit that is carrying on the work of advancing the president’s agenda in his second term, noted in a lunch with reporters and editors at Bloomberg’s Washington bureau yesterday. The campaign’s Spanish-language ads played heavily on the president’s health care reforms, Messina noted.

Yes, Obama’s agenda centers for the moment on immigration reform, but it also centered, in term one, on health care — offering coverage for tens of millions of uninsured Americans.

As Congress prepares to debate immigration, once again, the White House is taking the issues that play well in the Hispanic community directly to the community, around the filter of the national media, or, in this case, the English-speakng media.

His predecessor often called on the regional or local press to press his case.

And it’s not as if these are rare sessions, these presentations of Obama en espanol:

Pres Obama last gave interviews to Univision and Telemundo at the start of his 2nd Term on Jan 30th.

— Mark Knoller (@markknoller) March 26, 2013

Original post is Obama: ‘Sí, se Puede’ Communicate by Political Capital.

Photograph by David McNew/Getty Images

The industry today is holding the first-ever conference on covering so-called “dual eligibles”, people who are both old enough to qualify for Medicare,
and poor enough to be put on Medicaid. Photograph by David McNew / Getty Images

As at least 24 U.S. states prepare to move their oldest and sickest citizens from the government’s Medicare and Medicaid health programs into managed-care plans, insurers are figuring out the best way to profit.

The industry today is holding the first-ever conference on covering so-called dual eligibles, people who are both old enough to qualify for Medicare, and poor enough to be put on Medicaid. Such residents tend to cost states more money because the combination of their ages and economic statuses often translates into more complicated and expensive health ailments.

More than 9 million people are in that category, according to the nonprofit Kaiser Family Foundation, based in Menlo Park, California. While states had been hesitant to put poor elderly residents into managed-care plans out of concern for the quality of their care, recent budget constraints and rising health costs have left them searching for a better solution.

While dual-eligibles comprise about 15 percent of the Medicaid population, they account for about 40 percent of the program’s spending because of complicated health problems, such as dementia, according to Kaiser.

“The innovative programs and services health plans have pioneered can help improve care for beneficiaries dually eligible for Medicare and Medicaid and help put these programs on sustainable and fiscally-responsible paths,” Robert Zirkelbach, a spokesman for America’s Health Insurance Plans, the industry’s Washington-based lobby group, said in an e-mail.

He said the summit, which his group organized, “is an opportunity to showcase these initiatives.”

Twenty-four states plus Washington, D.C., enrolled at least some of their dual-eligibles in managed care as of 2010 according to data from Kaiser.

Florida was awarded a waiver last month from the U.S. Health and Human Services Department to put almost all of its Medicaid beneficiaries into managed-care plans, including people dually eligible for Medicare. California is testing the idea of managed care for dual-eligibles this year, according to Bloomberg Industries.

Original post is Insurers Set Eyes on States’ Oldest, Sickest by Political Capital.

Photograph by Chip Somodevilla/Getty Images

Texas Governor Rick Perry says his first priority as president would be to do away with the new health care law while being interviewed by Google Soapbox at the Iowa State Fair pin this August 15, 2011 file photo in Iowa.

Updated at 3:30 pm EDT

What don’t Rick Perry and Mitt Romney have in common?

Health insurance for their fellow home states’ residents.

It was Perry, the Texas governor who also sought the Republican Party’s presidential nomination last year, who announced last summer that he would reject the health-care exchanges and Medicaid expansion included in President Barack Obama’s Affordable Care Act.

“The bottom line here is that Medicaid is a failed program,” Perry said in an appearance on Fox News. “To expand this program is not unlike adding a thousand people to the Titanic.”

Yet look what else is sinking:

For the fifth year in a row, Texas ranks No. 1 in Americans lacking health insurance, according to a Gallup-Healthways survey.

More than a quarter of adult Texans — 28.8 percent — lacked coverage in 2012, the highest rate for any state since the survey started in January 2008.

Massachusetts, it goes to figure, has the lowest rate, at 4.5 percent — thanks to another former governor, Romney, who once advocated a mandate there that became less appealing to him in the 2012 presidential election contest.

Nationwide, an average of 16.9 percent of all adults lacked coverage.

While Perry holds out against the Medicaid expansion, other Republican governors — including Florida’s Rick Scott — have started reassessing their opposition to the provision of “Obama-care” that offers states expanded funding and coverage for more people. The Florida Legislature, however, appears to want none of it today.

In Florida, 22.8 percent of all adults were uninsured for health care.

Gallup’s Elizabeth Mendes reports: “Uninsured rates in about half the U.S. remained higher in 2012 than in 2008. Just four states, though, show year-over-year increases every year since 2008 — Rhode Island, New Jersey, California, and New York. And Texas — the state with the highest adult uninsured rate in the country for five years in a row — continues to widen the gap between it and the state with the second-highest uninsured rate in the U.S.”

Results are based on telephone interviews conducted as part of the Gallup-Healthways Well-Being Index survey throughout 2012, with a random sample of 353,564 adults and a possible margin of error of 1 percentage point.

Original post is Perry’s Titanic Texas: Health Insurance by Political Capital.

Jeb Bush, former Florida governor. Photography by William Thomas Cain / Getty Images

Former Florida Gov. Jeb Bush, visiting the Texas legislature, said that sharing his thoughts on Medicaid expansion might raise some hackles back home.

It also might cause him trouble at Tenet Healthcare Corp., whose Chief Executive Officer Trevor Fetter told Bloomberg News yesterday that all Republican governors would eventually expand their programs under President Barack Obama’s 2010 Affordable Care Act.

Bush is a director at Tenet, which is based in Dallas.

Asked to discuss his opposition to expanding Medicaid at a press conference in Austin, Bush said: “No. I just don’t want to get in trouble back home.” Earlier he testified on education reform at a Texas Senate committee hearing.

Florida Gov. Rick Scott, a Republican, last week said he would approve the Medicaid expansion, joining 24 other states participating in the health program for the poor. Fourteen other Republican governors remain opposed, including Rick Perry of Texas, according to a tally by Advisory Board Co., a technology consulting company based in Washington.

Asked about his interest in running for president in 2016, Bush said it’s too early for him to consider the matter.

Original post is Jeb Bush on Medicaid: ‘Trouble Back Home’ by Political Capital.

Photograph by Andrew Harrer/Bloomberg

Demonstrators in favor of the Affordable Care Act stand outside the Supreme Court building on June 28, 2012.

From Bloomberg Government’s Congress Tracker blog

President Barack Obama said in his State of the Union address that his health-care overhaul is taming costs, though Congress’s top budget advisor isn’t so sure.

Douglas Elmendorf, director of the nonpartisan Congressional Budget Office, told lawmakers that he doesn’t know why once-spiraling costs have slowed in recent years.

“We have not attributed the slowdown to any particular factor like the Affordable Care Act,” he told the House Budget Committee, referring to the law enacted in 2010.

It’s a combination of the slow economy — people spend less on care when they feel strapped — and structural changes in the health-care industry that economists don’t yet understand, Elmendorf said.

“The structural part could have a number of possible causes,” he said.  “One could be providers thinking about the current incipient effects of the Affordable Care Act, but they also are driven by pressures from private insurers. I think providers are driven by their own sense that they’re not providing care in as efficient a way as possible.”

In his speech last night, Obama took credit for the slowdown, telling lawmakers: “Already, the Affordable Care Act is helping to slow the growth of health-care costs.”

Cost increases have been slowing for several years; Medicare grew by just 3 percent, or $16 billion, in 2012, the smallestannual gain since 2000. That helped prompt CBO to ratchet back its projections of future costs. It now anticipates that Medicare and Medicaid will cost $200 billion less in 2020 alone than it anticipated just three years ago.

“That’s a topic that we’re giving a lot of thought to,” said Elmendorf. “I think the right way to summarize the consensus is that we don’t know.”

Original post is Obama Says Health Law Cutting Costs; CBO Chief Isn’t So Sure by Political Capital.

Photograph by Andrew Harrer/Bloomberg

Demonstrators in favor of the Affordable Care Act hold up signs outside the Supreme Court building after the court’s ruling in Washington on June 28, 2012.

This week will be the last opportunity for states to retain some control over the new health insurance markets being readied for 2014 as part of the U.S. Affordable Care Act.

States still on the fence about building the exchanges for people to shop for subsidized health insurance must tell the Obama administration by Feb. 15 if they’ll at least join in a partnership with the federal government. The administration has said it will run exchanges for residents in states that refuse to build their own nor aid in the partnership.

It’s the latest deadline for governors grappling with full implementation of the 2010 federal health-care law, which relies on state cooperation to meet estimates of providing medical coverage to 27 million uninsured Americans. The government wants the state exchanges to be open for enrollment by Oct. 1 so residents can buy health plans that would take effect Jan. 1.

Just 16 states and Washington, D.C., are building their own exchanges, including three states led by Republicans — New Mexico, Nevada and Idaho. Utah Governor Gary Herbert said last week he would let the federal government build an exchange in his state, and the Obama administration on Feb. 8 rejected an application from Mississippi because that state’s insurance commissioner and governor weren’t on the same page.

Arkansas, Delaware, Illinois, Iowa and North Carolina have so far said that they’ll help the federal government run an exchange, a relationship the Obama administration calls a “partnership. The states take on some functions such as consumer assistance and approving health plans, while the federal government builds the website and other infrastructure.

North Carolina may back out; the state sent its partnership letter last year, before Republican Pat McCrory replaced Democrat Beverly Perdue as governor. The Republican-led legislature is considering a bill that would prohibit the state from helping to build an exchange.

Original post is Last Chance: States’ One Shot at Exchange Control Looms by Political Capital.

Photograph by Mladen Antonov/AFP via Getty Images

A cardboard cut-out of President Barack Obama in a tent defending “Obamacare” at a street fair in Charlotte, North Carolina.

The 2010 health-care law that’s expected to expand insurance coverage to 27 million Americans in the next decade isn’t cheap: About $1.2 trillion through 2022.

There’s another cost, less well known: The time Americans will spend complying with the law and its requirements. And that figure may be even more jaw-dropping: About 127.6 million man-hours per year and counting, according to the House Ways and Means Committee.

The committee — chaired by Michigan Republican Dave Camp, no fan of President Barack Obama’s Affordable Care Act — unveiled today what it calls the “Obama-care Burden Tracker.” The online tool relies on data produced by the Obama administration itself as it writes regulations implementing the health law.

Under a law called the Paperwork Reduction Act, federal agencies have to calculate how much time the nation’s citizenry will spend complying with their regulations. The burden is reported in hours as part of regulatory filings, and is summed up in a report from the White House Office of Management and Budget each year.

In 2011, for example, Americans spent about 9.1 billion hours on federal paperwork, according to the most recent report. In that context, the health-care law will only increase the public’s bureaucratic burden by about 14 percent.

“With many rules and regulations yet to come, these 127 million burden hours — many of them due to complying with new taxes — are just the tip of the iceberg,” Camp said in a statement.

Some of the burden, though, is voluntary.

For example, the most burdensome regulation yet issued under the 2010 health-care law relates to an optional tax credit available to small businesses that insure their workers. Complying with those rules alone would cost Americans about 40 million hours a year, the Obama administration says; perhaps an indication why many small businesses aren’t bothering.

A spokeswoman for the White House budget office, asked about the Ways and Means burden tracker, didn’t dispute Camp’s math. She noted that Obama has repealed some of the government’s regulatory burden, including a proposal yesterday to dump a handful of rules for hospitals in the Medicare program that the administration considers unnecessary or obsolete.

“From the start, the Administration has taken a balanced regulatory approach, focusing on putting in place lifesaving protections, while eliminating tens of millions of hours of paperwork burdens for our nation’s citizens and businesses,” said the spokeswoman, Jessica Santillo, in an e-mail. “As part of this approach, President Obama has launched an historic review of existing rules on the books to streamline, modify, or get rid of those that cost too much or no longer make sense, an effort that is already on track to save billions of dollars.”

Original post is Health-Care’s Added Cost: Compliance by Political Capital.

Photograph by Jeffrey Neira/CBS via Getty Images

New Jersey Governor Chris Christie laughs with David Letterman when the governor makes his first visit to CBS’ “Late Show with David Letterman,” on Feb. 4.

New Jersey Governor Chris Christie has some advice for the long-distance doctor who advises him to lose weight:

“Shut up.”

The Republican governor, speaking in Sea Girt today, commented on a news report of Connie Mariano, a physician who worked for former President Bill Clinton, saying that she worries about Christie having a heart attack or stroke.

“I’m a Republican,” Mariano said in an interview with CNN. “I like Chris Christie. I want him to run. I just want him to lose weight. I’m a physician more than I’m a Democrat or Republican. And I’m worried about this man dying in office.”

Mariano is “just another hack who wants five minutes on TV,”  Christie said today.

“I find it fascinating that a doctor in Arizona — who’s never met me, never examined me, never reviewed my medical history or records and knows nothing about my family history — could make a diagnosis from 2,400 miles away,” he said. “She must be a genius,” he added. “She should probably be the surgeon general of the United States, I suspect.”

“I have four children between nine and 19,” the governor said. “My 12-year-old son come up to me last night and said `Dad, are you going to die?’… If she wants to get on a plane and come here to New Jersey and ask me if she can examine me or review my medical history, then I’ll have a conversation with her. Until that time, she should shut up.”

Mariano didn’t immediately respond to a message left at her office, the Center for Executive Medicine in Scottsdale, Arizona, whose Web-site bills its services as “modeled after the health care provided to America’s chief executive.”

Appearing on CBS’s “Late Show with David Letterman” this week, the governor said his cholesterol and blood-sugar levels were both within normal ranges during a physician’s exam ahead of his 50th birthday in September.

Christie also ate a doughnut on stage.

“I’m basically the healthiest fat guy you’ve ever seen in your life,” Christie told Letterman, who suggested that the governor make that the slogan for his re-election campaign.

And should he run for president in 2016, and win, he’ll get his own White House physician, and a surgeon general.

Original post is Christie to Doctor: ‘Shut Up’ by Political Capital.