Discussing 'a $600 million dessert'

Updated: Friday, September 6, 2013
Discussing
KALAMZOO, Mich. (NEWSCHANNEL 3) - In the days after the State Senate narrowly extended Medicaid coverage to nearly a half-million Michigan residents, it became clear that Senators want poverty-stricken people to help pay for their own health care.

Tonight, in Tom's Corner, Tom Van Howe says that by turning down more than a half-billion dollars in Obamacare reimbursements over the first quarter of next year, and then asking poor people to help make up the difference, paints a picture of a remarkably insensitive group of politicians.

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The Michigan Senate Minority Leader, Gretchen Whitmer, explained her Republican colleagues' opposition to medicaid expansion, which is a part of the affordable care act, this way:

"It's because (expansion) is associated with Obamacare and because the tea party in Michigan is the tail that's wagging the dog in this chamber."

And I think she's right.

There is no other logic to the Senate, 26 of whom are Republicans, and 12 are Democrats, in delaying enrollment from January 1st to April 1st.

By doing so they knew full well that they were turning their backs on $7 million a day in federal money to be used for Medicaid.

That's a total of more than $600 million. Six-hundred-million that the state loses.

That's not a number pulled out of the air by some hand-wringing alarmist. It comes from Jim Haveman, the Director of this state's Department of Community Health.

In fact, yesterday he said his estimate may, in fact, be too low.

Republican response? Well, we probably won't get that many enrolled right away, so that figure may be too high.

So what's their best guess? They haven't got one.

Senate Majority Leader Randy Richardville, who to his credit, helped form the tiny coalition to get the matter through the Senate last week, doesn't even want to talk about it.

"It's like we had this really big dinner," he said. "We got the dinner done and people are going to ask for dessert.
 
“We're going to skip the dessert on this one. We're done. The legislature in total has gone through enough with this issue."

Dessert? He thinks $600 million is dessert? Sounds more like a main course of steak, potatoes, and choice of vegetable for a half-million people to me.

And of course during that same 90 day period state hospitals will continue offering what will amount to roughly a quarter of a billion dollars in expensive emergency room care to poor people.

Much of the cost of that gets picked up by the insured who pay higher premiums, and some of it gets picked up by federal reimbursement. But reimbursements will be reduced as of January 1, because that's ostensibly when people start signing up for Obamacare.

Look, you don't have to be a fan of Obamacare to take the money. Obamacare—even though it's the law of the land—may not work.

But the money is there for the taking. It's just smart government.

Phil Power, a former University of Michigan Regent, now a writer for Bridge Magazine, said yesterday he sometimes wonders if Republican lawmakers in Lansing would even vote against something called "Obamataxcut." Good point.

And then the icing on the cake. The Senate wants poor people, not just the new ones, the ones just above the poverty line, but all of them, to pay 5 percent of their income in copay fees.

So in addition to rent, food, transportation, clothing, and other things they can't afford, they have to fork over 5 percent in copay fees.

After four years it'll go up to 7 percent. Nobody knows how it'll get collected.

But its an intimidating little add-on that'll probably keep any number of qualified people from breaking the door down to enroll.

And those fees, all by themselves, could actually block the Medicaid expansion itself. The Center for Medicare and Medicaid Expansion has to approve Michigan's legislation.

And an expert said yesterday she thought the CMS would be taking a close look at Michigan's bill before giving it an okay.

Forget dessert. We may lose the whole enchilada.

In this corner...I'm Tom Van Howe.

Business News

Last Update on October 24, 2014 17:58 GMT

NEW HOME SALES

WASHINGTON (AP) -- U.S. sales of new homes were essentially flat in September, after the government sharply revised downward what was initially an August surge in buying.

The Commerce Department says new-home sales edged up 0.2 percent last month to a seasonally adjusted annual rate of 467,000. The report also revised down the August sales rate to 466,000 from 504,000.

The pace of sales for newly built homes has improved a mere 1.7 percent so far this year compared to 2013. Only the South has experienced gains in buying year-to-date.

Housing has struggled to fully rebound since the recession ended more than five years ago. Many potential buyers lack the savings and strong credit history needed to afford a home, causing them to rent or remain in their existing houses instead of upgrading.

EARNS-FORD

DEARBORN, Mich. (AP) -- Ford's net income dropped 34 percent to $835 million in the third quarter, dragged down by the cost of launching its new F-150 pickup.

The company closed its Dearborn truck plant for five weeks during the quarter and cut back on truck sales in order to preserve inventories while it readies the new aluminum-sided truck. That hurt pretax profits in North America, which fell 39 percent to $1.4 billion.

Ford earned 21 cents per share, down from 31 cents in the July-September period a year ago. Without one-time items, including separation costs in Europe, Ford earned 24 cents. That beat Wall Street's expectation of 19 cents, according to analysts polled by FactSet.

Revenue fell 2.5 percent to $34.9 billion, better than the forecast of $33.7 billion.

UPS-HOLIDAYS

ATLANTA (AP) -- UPS is expecting an 11 percent jump in December shipments as the holiday shopping season heats up.

UPS recently announced that it would hire up to 95,000 people to handle the tremendous volume. That's up from last year when the Atlanta company initially planned to hire 55,000 seasonal workers. Major U.S. shipping companies were overwhelmed by a shift in American shopping habits, namely the success of Amazon.com. with its free shipping, and UPS was forced to hire an additional 30,000 people.

United Parcel Service Inc. also maintained its guidance Friday for 2014 adjusted earnings between $4.90 and $5 per share. Analysts polled by FactSet predict $4.95 per share.

PROCTER & GAMBLE-DURACELL

Procter & Gamble removes the batteries

CINCINNATI (AP) -- Procter & Gamble is removing the batteries and making Duracell a stand-alone company.

P&G, which acquired Duracell in 2005, announced earlier this year that it would shed more than half its brands around the globe over the next year or two.

If a split off occurs, P&G said that its shareholders would have the option of exchanging some, none or all of their P&G shares for shares of the newly formed Duracell company.

The Procter & Gamble Co., based in Cincinnati, said Friday that it is also considering a spinoff, sale or other options for Duracell.

CHIQUITA-FYFFES

CHARLOTTE, N.C. (AP) -- Chiquita shareholders have rejected plans to merge with Irish fruit importer Fyffes that would have made the world's largest banana supplier.

Chiquita Brands International Inc. said Friday that the shareholders didn't approve a revised transaction agreement between the two companies during a special shareholders meeting.

Chiquita said it now expects to enter talks with investment firm Safra Group and juice company Cutrale Group on their competing offer of $14.50 per share. Chiquita previously rejected buyout bids from the two Brazilian companies.

CHILD SEAT RECALL

DETROIT (AP) -- Evenflo is recalling more than 202,000 rear-facing infant seats because the buckles can become difficult to unlatch.

The recall affects Embrace 35/9999 models with an AmSafe QT1 buckle. Documents posted by U.S. safety regulators say that if the buckles don't release easily, it may be difficult to get a child out of the seat in an emergency.

The affected seats were made at various times from December 2011 through May of 2013.

Not all Embrace 35 models are covered by the recall. For others, the company will provide replacement buckles if requested by customers.

The recall comes after an investigation by the National Highway Traffic Safety Administration.

Owners with questions can call Evenflo at (800) 490-7591.

HALAL FOODS-INVESTIGATION

IOWA CITY, Iowa (AP) -- The founder of a popular brand of food for observant Muslims has been indicted on charges that he shipped beef to Malaysia and Indonesia that didn't meet those countries' import requirements.

A federal grand jury returned the indictment Thursday against Bill Aossey Jr., who founded the Midamar Corp. in 1974. The Cedar Rapids company grew into the leading U.S. halal brand, selling more than 200 products in the U.S. and abroad.

A 19-count indictment charges Aossey with directing employees to change labels and fabricate documents to make beef products appear that they originated from a slaughterhouse that met Malaysia and Indonesia's strict requirements. Halal meat is supposed to be killed in ritual slaughter.

Aossey's attorney called the indictment unfair Friday, saying the allegations were "a minor regulatory violation" at most.

NBC INTERNS-SETTLEMENT

NEW YORK (AP) -- NBCUniversal will pay $6.4 million to settle a class action lawsuit brought by unpaid interns who worked on "Saturday Night Live" and other shows who claim they are owed wages, according to court documents.

The interns claim NBCUniversal wrongly classified them as non-employees in an effort to avoid labor laws. NBCUniversal said in court documents that even though it is settling the suit, it denies the allegations and doesn't admit any wrongdoing.

The average amount that class-action members of the suit will receive is $505, although the main plaintiffs will receive more. The number of class members is capped at 8,975.

The interns had been seeking recovery of unpaid wages, attorneys' fees, interest and liquidated damages. The settlement still has to be approved by a judge. The lawsuit was filed in federal court in New York.

NBCUniversal is owned by Philadelphia-based cable provider Comcast Corp.

CYPRUS-ECONOMY

S&P upgrades Cyprus on commitment to bailout deal

NICOSIA, Cyprus (AP) -- Rating agency Standard & Poor's has given Cyprus a one-notch upgrade to its credit grade, raising it to B+.

The agency cited the country's commitment to the terms of its bailout program and better-than-expected economic growth. It also said the outlook for Cyprus is stable, with good economic progress offset by lingering challenges to its banking system, which is still burdened with a huge amount of bad loans.

BRITAIN-ECONOMY

LONDON (AP) -- Official figures show Britain's economic recovery is continuing, despite a gloomy global environment.

The Office for National Statistics said gross domestic product grew 0.7 percent in the three months through September compared with the previous three months. That is down slightly from a 0.9 percent quarterly rate in the April-June period but remains among the strongest growth rates among developed economies.

Compared with a year earlier, the economy was 3.0 percent larger.

Treasury Chief George Osborne says the figures show Britain "continues to lead the pack in an increasingly uncertain global economy."

Samuel Tombs, the senior U.K. economist for Capital Economics, says growth in Europe's third largest economy has become broader-based, though recent falls in stock markets, manufacturing surveys and eurozone growth have intensified concerns over the recovery.

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