A Must-Read from Mother Jones on Healthcare Proposal

Not as lengthy as some of the more important Mother Jones articles, but nevertheless it was very insightful.
Please click this link to an article titled: Congress's $1.2 Million a Day Drug Habit—and Pharma's Phony "Gift" to Health Care Reform at http://www.motherjones.com/mojo/2009/06/pharmas-phony-gift-seniors

Many seniors on the Medicare Part D plan go on generics as they enter the "donut" phase of the plan -- and never go back onto the brand-name drugs after exiting the donut.

Under this proposed plan seniors may decide they are better off staying with the brand name drug through the whole year. Big Pharma will like that.

Some States Already Refusing National Healthcare

Arizona is one state that has made it clear it wants no part of a national healthcare plan. It has refused other federal programs before, so this is not a sudden policy change.

EXCERPT: Right on the heels of a successful state-by-state nullification of the 2005 Real ID act, the State of Arizona is out in the forefront of a growing resistance to proposed federal health care legislation.
This past Monday, the Arizona State Senate voted 18-11 to concur with the House and approve the Health Care Freedom Act (HCR2014). This will put a proposal on the 2010 ballot which would constitutionally override any law, rule or regulation that requires individuals or employers to participate in any particular health care system.
HCR2014, if approved by voters next year, also would prohibit any fine or penalty on anyone or any company for deciding to purchase health care directly. Doctors and health care providers would remain free to accept those funds and provide those services.
Finally, it would overrule anything that prohibits the sale of private health insurance in Arizona.
Five other states — Indiana, Minnesota, New Mexico, North Dakota and Wyoming — are considering similar initiatives for their 2010 ballots.

You may read the whole article at this forum page: http://usfreestar.newsvine.com/_news/2009/06/26/2972841-arizona-hcr2012-national-health-care-nullification -- We has lots of good discussions on this site so you might want to browse awhile.

How Would Your Life Be Different if We Had National Healthcare?

A provocative article ran recently in the pages of AlterNet regarding the writer's experience living in Canada for a while. Her five years in Canada were a real eye-opener in how a healthcare system could work, sparing people the economic drain of continual insurance and medical bills.

She wrote:

This was one of the things that struck me hardest when I arrived in Canada five years ago. The swamp-blindness was so dark and deep that it took a while to adjust to a world without alligators. It's almost impossible to describe to folks back home how different life is when health insurance simply doesn't factor at all into how you choose to live your life. There's almost no language for it. Rather than even attempt it, I sometimes just ask my American friends and relatives to open up their imaginations, and answer the question for themselves:

* How would your life be different if you never had to worry about getting, keeping, or affording health care again?
* What other choices might you have made?
* Where else would you be right now?
* How would it change your plans for the future?

You can read the whole article here at http://www.alternet.org/healthwellness/140918/what_did_you_sacrifice_to_afford_health_care_/?page=entire -- AlterNet is a wonderful website with many such interesting and provocative articles. I hope you like it.

Annuities Have Become 'The New Black'

by L.A.S.

In 2008, to no one's surprise, investors, suddenly shifted funds into plain old boring fixed annuities. How many investors did this? Just to quote some startling stats that came out earlier this year, sales of fixed annuities in 2008 jumped to $107 billion, up nearly 60 percent over 2007.

We are talking about the most snore-inducing sector of the financial investment field, the fixed or fixed index annuity here. Perhaps the only item that qualifies as duller is the savings bond. Now normally, we are told to have a portion of our investments in safe instruments such as bonds or insurance, vehicles like that. And some of us actually do that.

But traditional diversification did not work for most of us in 2008. So that explains the rush to the safety of the fixed annuity. It is very simple to understand: you just toss a lump sum into the kitty and draw upon it to suit your needs. There are variations in how long a waiting period before you begin drawing on the annuity, and there are also some that allow you to deposit small sums during your working life in order to draw upon it in your retirement, just like an IRA or 401K.

But the deferred accounts are nice because the interest they accrue is tax free. The longer the deferred period, the better, of course, so that they can swell into very nice nest eggs indeed. The downside has always been that you had to accept a rather low rate of return in exchange for this level of boring safety. The other downside is a rather steep penalty for dipping into your fund in case of emergency.

Deferred annuities generally produce a 5 percent rate of return, while immediate annuities may give only about 3.5 percent. And because you are locking into just one company, you want to know for sure that the company is very strong. Everyone thought that AIG was too big to fail, to coin a phrase, but we found out differently.

There are several reputable insurance companies that have avoided the flash and the sizzle, and as a result are in very good financial shape today, even after the stock market bloodbath. Northwestern Mutual Life, headquartered in Milwaukee, is one. (I am not an agent of NML nor am I reimbursed in any way for mentioning them; but I am rather proud that they are based in my birthplace.)

Another Scandal Looming for Big Banks, Financial Houses

by L.A.S.

Yet another scandal and heavy fines loom for the big banks and investment houses, this time due to investigations of tax cheating. The IRS has been bearing down on advisors who have helped the wealthy shelter money in offshore accounts. This is not breaking news but little attention has been paid to the financial consequences of the heavy IRS fines in such cases.

A recent case in which a former banker at UBS, the the Swiss bank, pleaded guilty last year to helping a client hide $200 million in an offshore account. The banker turned whistleblower and revealed that the bank holds billions of dollars for American customers in those secret Swiss bank accounts.

According to one source, there are roughly 52,000 suspected accounts; that is just the UBS accounts and there could be many thousands more with other banks such as Credit Suisse, HSBC, and others. It is difficult to imagine how the IRS might seek out so many cheats but their strategy is to offer amnesty to the depositors.

Depositors will still have to pay back taxes, otherwise they could eventually face five years in jail and fines of $100,000 or half of the amount in the foreign account (whichever is more).

Now, supposing the investment house failed to keep on file a form that properly advised the client (the depositor) that they have to file this account with the IRS. In that case, the investment house (or the advisor) faces being dragged into court and face similar jail time and fines for tax fraud.

How many such accounts are out there with American firms or at least American offices? How many of their American staffers stand in danger of being dragged into court and probably losing their licenses as financial advisors? And what will Wall Street make of those companies when the you-know-what finally hits the fan? It could get ugly out there.

The fact that even foreign stock exchanges are now highly correlated with the fortunes of the American stock exchanges is changing the axiom that there is safety in diversifying one's stock among domestic and foreign companies. You may have stock in some foreign banking interests without realizing it, just because you bought into global mutual funds, perhaps. The world markets and financial linkages are now so pervasive that nothing is isolated from general trends in the U.S. as it once was.

It is a difficult time to correctly evaluate the relative risks of mutual funds or any other foreign investments, so perhaps the right kind of diversification is between betting on the rising market and betting on the sinking market. People still have not quite recovered their confidence that times are getting better, in spite of a partial recovery of the Dow Jones.

Your Pharmacist Does NOT Have a Right to Change the Rx to a Generic!

Stories have been coming out from consumers regarding how their pharmacist changed their prescription to a generic -- and this was done without telling them, and without asking their permission!

This has led to some horror stories of inadequate medication in the bloodstream for an epileptic. Her pharmacist, she learned, had exchanged her Tegretol for a generic that worked a little differently. "Just imagine what could have happened had I been behind the wheel of a car," she says. Luckily she was on a bicycle and while she sustained serious injuries, at least there was no fatality.

Pharmacists are so afraid of running afoul of insurers' pressure to use generics that they mistakenly tell patients that it is the law that they do so. Under a practice called "therapeutic substitution", pharmacists may substitute a generic for a brand-name drug even if your doctor specifies the brand name.

According to an article on MSNBC:

A pharmacist legally switched a drug prescribed by her doc — but without telling her or her physician. Usually, pharmacists replace a brand-name drug with a generic formulation of the exact same medication. Therapeutic substitution is similar but with one crucial distinction: The new drug is in the same class as the old and treats the same condition, but it's not precisely the same medication.

To understand the nuance, think of statins. They constitute a single class of medication because they all lower cholesterol by reducing its production in the liver. But not every statin lowers cholesterol by the same amount or with the same balance of LDL to HDL. So if your doctor orders a brand-name drug but your pharmacist switches it for the cheaper version of a different medication (but still a statin), you may not get the precise benefit your doctor had in mind — and may, in fact, suffer unexpected side effects.

This is horrendous -- we are all in favor of lower drug costs and in favor of using generics where appropriate, but no pharmacist should ever spring a surprise on any customer.

To read the whole article you may go here: http://www.msnbc.msn.com/id/30627962/
In one way, at least, patients can benefit from substitution — smaller co-pays. But two-thirds of people who reported having meds switched in a National Consumers League survey said they weren't consulted. Of those, 40 percent said the new drug was not as effective, and a third said it had more side effects. "It's not okay for your insurance company or pharmacist to change your drugs without your knowledge," says NCL Executive Director Sally Greenberg.

Is it Right that Insurance Companies are Profiting from Smoking Twice?

A Canadian newspaper recently ran a story investigating how much insurance companies have invested in the tobacco industry. The June 5 issue of The Province found that Sun Life, a major Canadian insurance company, has a billion dollars invested with two tobacco companies. About $890 million of that is in Philip Morris. And the insurance industry as a whole has over four billion dollars invested in tobacco.

This brings up not only a question of business ethics, but of sending a mixed message to the public. Insurers have penalized smokers with higher rates for every type of insurance, and yet they continue to invest heavily in tobacco.

Clearly they place a higher value on profits, and obviously tobacco has been a steady producer of profits for investors of every size.

As long ago as 1995, we have known that insurance companies were rather heavily invested in tobacco. That is the year that Lancet ran an article on the subject. Insurers profit twice from tobacco: once from the higher rates charged to smokers, and again from their tobacco stock holdings.

The Province article also states that Prudential, which sells health and disability insurance, has $1.38 billion in two tobacco companies, including British American Tobacco (BAT).

Northwestern Mutual (NML), Massachusetts Mutual and the Scottish firm Standard Life also have large holdings in tobacco firms.

Do we as consumers have a right to criticize insurers for having these investments, whether or not we hold stock in the insurance companies? Or is tobacco such an old and traditional social vice that it is useless to rail against it? Remember that Prohibition against alcohol did not work.

We can simply choose to not invest in companies that invest in industries we do not want to encourage. We can simply choose to invest in green, sustainable industries and companies.

The article may be read at: http://www.theprovince.com/Health/Canadian+life+health+insurers+investing+heavily+tobacco+companies/1664704/story.html