Included in last year's GOP federal budget plan was a provision that would have retained the 31.5% beneficiary premium rate for Medicare Part B services.
By any measure this would represent no new cost to beneficiaries because they already were paying 31.5% of the tab. But Washington has its own way of measuring, and politics is part of the equation.
Because the law that bumped the Part B premium rate from 25% to 31.5% was set to expire on Sept. 30, 1995, the extension of the 31.5% rate was measured for budget purposes as new cost.
That gave Democrats an opening to say that the GOP was raising costs on beneficiaries, and they used it to great effect, hammering Republicans at every opportunity.
Since no budget bill was passed, the beneficiary rate actually did drop to 25%, resulting in lower premiums and higher government checks for nearly all the Social Security population.
This year, the GOP again proposed to keep the beneficiary payment ratio at 25%, even though most said they believe that 31.5% was a fairer number.
"We're willing to make a lot of tough choices, but this is not a battle we want in an election year," said Rep. Christopher Shays (R-Conn).
But not so fast. As it turns out, current law calls for the rate to fall again in 1999, this time to as low as 19%. That means that in budget terms, the Republicans are calling for about $5.5 billion (over six years) in new beneficiary costs.
The good news for Republicans is that the fiscal 1997 White House budget also called for retention of the 25% premium rate.
Moving on?HHS Secretary Donna Shalala says she isn't certain of staying on in her current post if President Clinton is re-elected.
"I have a four-year leave from (the University of Wisconsin), so I will have to make a decision right after the election in November, and that's when I'll make it," Shalala told a recent forum on child health issues organized by U.S. Rep. Dave Obey (D-Wis.).
Shalala, 54, was chancellor of the University of Wisconsin at Madison from 1988 to 1992 before joining Clinton's Cabinet. She has been approached by Wisconsin Democratic leaders to run for Congress, but declines to talk to them.
"Right now, I'm just totally focused on my job first, and then helping the president get re-elected," she said.
Old Kentucky Home.Louisville breathed a collective sigh of relief when long-term-care giant Vencor chose the Kentucky capital as its official headquarters.
The company was considering a move to Cincinnati, but was encouraged to stay by a package of financial incentives reportedly worth more than $30 million. In turn, the company will spend as much as $50 million on its new headquarters and triple the number of its workers in the city from 300 to 900. Vencor is now the largest U.S. employer based in the state.
The decision was considered especially important because Columbia/HCA Healthcare Corp. stunned the city last year when it relocated to Nashville, Tenn. About 300 Vencor employees heard the good news at a press conference earlier this month, where Gov. Paul Patton, Louisville Mayor Jerry Abramson, and other local and state officials were on hand.
Even Rick Pitino, coach of the University of Kentucky Wildcats basketball team, joked that Vencor leaving the state would be worse than his star player, Antoine Walker, departing for the National Basketball Association. Walker did leave.
HSIde effects.With healthcare still consolidating like mad, executives might ponder the consequences of scrapping a much-ballyhooed combination.
Health Systems International recently reported that as of March 31 it had lost 41,000 commercial enrollees "due to marketplace confusion caused by the abandoned merger" of HSI and WellPoint Health Networks.
That's on top of $20.2 million in merger costs HSI reported in its 1995 year-end financial statement. Those merger costs caused fourth-quarter 1995 profits to slip despite a surge in revenues.
"During open enrollment last fall, the merger was the subject of a great deal of speculation and confusion back and forth in the press," an HSI spokesman said. "We believe very strongly that confusion caused some accounts not to choose Health Net (HSI's HMO) because they weren't sure what Health Net's ultimate fate was going to be," he said.
The spokesman added that HSI also was "holding the line on pricing while others were pricing irrationally and customers were taking advantage of that, and we didn't get some members we otherwise would have."
The news isn't all bad. The decrease in commercial enrollment was partially offset by an enrollment increase of 7,000 in Medicare, 10,000 in Medicaid and 4,000 in plans for which HSI only provides administrative services, for a total HMO enrollment of 1.9 million.
Smoking mad.A New York-based not-for-profit group representing thousands of physicians and scientists scorched the editors of Elle magazine for what it views as an endorsement of cigarette smoking.
The American Council on Science and Health gave its Poison Apple Award to the women's magazine for offering readers of its May 1996 issue a chance to purchase an official "Elle cigarette case" for $38.
"The modern-day Snow White who takes this apple from the wicked stepmothers at Elle won't have the benefit of Prince Charming to wake her from her sleep-either she will die before he finds her, or her smoking will have made her so unattractive that he won't want to kiss her," chided ACSH President Elizabeth M. Whelan, M.D., in the award announcement.
According to Elle's ad for the promotional product, the cigarette case is "the latest fashion statement for business lunches and power suits. This handsome and sophisticated antique-like silver-plated case is the stylish way to transport your favorite brand."
Whelan has been evaluating how women's magazines write about and advertise cigarettes for the past several years. She has called for the magazines to provide more articles on the risks of smoking and fewer ads glamorizing the act.
Though Whelan had thought most magazines were slowly headed in that direction, she was shocked by Elle's campaign. "By making this cigarette case an official magazine promotion, the editors of Elle are endorsing cigarette smoking," Whelan claimed. "We can only await the introduction of the Elle snuff box and the Elle opium pipe. For shame!"
Editors at Elle were unavailable for comment.