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.

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Last Update on April 24, 2015 18:03 GMT

AMAZON-CLOUD COMPUTING BUSINESS

NEW YORK (AP) -- Amazon's profitable cloud-computing services business is growing by leaps and bounds.

That growth helped the e-commerce company Thursday post a 15 percent first-quarter revenue jump and a smaller-than-expected loss. The results sent Amazon's shares up 6 percent in aftermarket trading.

Investors have been growing restless with Amazon's long-term strategy of plowing most of the money it makes into new areas like cloud computing, streaming video and hardware -- leading to razor-thin profits or, in this quarter's case, a loss.

Because Amazon had never broken out details on Amazon Web Services before, it wasn't clear if it was operating at a profit or loss. But details released on Thursday show that surging revenue isn't coming at expense of a profit in that business, reassuring investors.

Amazon has rolled out a series of new offerings in recent months.

DEATH OF COMCAST-TIME WARNER CABLE

NEW YORK (AP) -- Comcast is dropping its $45 billion bid for Time Warner Cable after heavy regulatory pushback.

The combined company would have put nearly 30 percent of TV and about 55 percent of broadband subscribers under one roof, which would give the resulting behemoth unprecedented power over what Americans watch and download.

Competitors, consumer groups, and politicians have criticized the deal, saying it would lead to higher prices and less choice.

Even with the Comcast saying Friday that the deal was off, cable companies are likely to keep combining as costs rise for the shows, sports and movies they pipe to subscribers and video customers decrease.

Many analysts expect that Charter Communications Inc., which lost out on its bid for Time Warner Cable Inc. to Comcast Corp., to resurrect its effort.

DURABLE GOODS

WASHINGTON (AP) -- Orders to U.S. factories for long-lasting manufactured goods increased by the largest amount in eight months. But a key category that tracks business investment plans dropped for a seventh month, suggesting that manufacturing is still struggling through a soft patch.

The Commerce Department says orders for durable goods rebounded 4 percent in March after having fallen 1.4 percent in February. The strength was led by a big jump in demand for commercial aircraft. But outside of the transportation category, orders were down for a sixth straight month.

There was also a 0.5 percent drop in demand in the category that serves as a proxy for business investment plans. The decline followed a 2.2 percent drop in February. This key investment category has been down seven consecutive months.

EARNS-AMERICAN AIRLINES

FORT WORTH, Texas (AP) -- American Airlines Group Inc. (AAL) on Friday reported first-quarter earnings of $932 million.

The Fort Worth, Texas-based company said it had net income of $1.30 per share. Earnings, adjusted for non-recurring costs and pretax expenses, came to $1.73 per share.

The results surpassed Wall Street expectations. The average estimate of 11 analysts surveyed by Zacks Investment Research was for earnings of $1.70 per share.

The world's largest airline posted revenue of $9.83 billion in the period, also topping Street forecasts. Four analysts surveyed by Zacks expected $9.82 billion.

American Airlines shares have dropped 4 percent since the beginning of the year. The stock has increased 39 percent in the last 12 months.

GREECE-BAILOUT

RIGA, Latvia (AP) -- European creditors have been turning up the heat on Greece today. They're pressing Greek officials to deliver an economic reform program that the country will need in order to avoid a possible default -- and even an exit from the euro currency group.

At a meeting today in Latvia, Greece's finance minister heard a series of rebukes from his counterparts in the eurozone for failing to come up with a comprehensive list of economic reforms.

The eurozone's top official calls it a "very critical discussion."

Others spoke of being "tired" and "annoyed" with the way the talks were going. Austria's finance minister says they made those points "very vigorously."

Two months ago, Greece won an agreement from the eurozone under which it would get the remaining money in its bailout fund -- about $7.7 billion -- but only if it came up with a set of reforms that everyone could agree on.

There are just days to go before that deadline, and Athens has yet to present a full list.

EUROPE GM CROPS

BRUSSELS (AP) -- The European Union has authorized the use of more genetically modified food and feed amid a row over whether EU member states should be able to independently ban certain GM products.

The EU's executive commission said Friday that it has approved 10 GM foods, including strands of maize, soybean and cotton, after they "have been proved to be safe." Two kinds of GM cut flowers were also authorized.

The European bio-industries association expressed satisfaction that the EU has "finally decided to authorize imports of safe products."

The EU and its member nations have been locked in a dispute over whether countries should be allowed to individually ban GM produce that EU institutions consider safe.

DIET PEPSI-NEW SWEETENER

NEW YORK (AP) -- PepsiCo says it's dropping aspartame from Diet Pepsi in response to customer feedback and replacing it with sucralose, another artificial sweetener commonly known as Splenda.

The decision to swap sweeteners comes as Americans keep turning away from popular diet sodas. Coca-Cola said this week that sales volume for Diet Coke fell 5 percent in North America in the first three months of the year.

Executives at Coke and Pepsi blame the declines on perceptions that aspartame, first sold under the brand name Nutrasweet, isn't safe. That's even though the Food and Drug Administration says more than 100 studies support aspartame's safety.

Still, PepsiCo says it wanted to listen to its customers.

Andrea Foote, PepsiCo spokeswoman, says the reformulated Diet Pepsi drinks will start hitting shelves in August.

LISTERIA-ICE CREAM

WASHINGTON (AP) -- Major recalls from two well-known ice cream companies due to the discovery of listeria bacteria raise questions about how the pathogen could have contaminated multiple ice cream manufacturing plants -- and whether the discoveries are related.

Blue Bell Creameries of Texas and Jeni's Splendid Ice Creams of Ohio both took products off shelves this week after listeria was discovered in their products. Blue Bell ice cream is linked to 10 illnesses in four states, including three deaths. There are no known illnesses linked to the Jeni's recall.

The recalls are unusual: Listeria is rarely found in ice cream because it can't grow at freezing temperatures. A spokesman for the Food and Drug Administration says it has no evidence, for now, that the two recalls are connected.

TANNING LAWSUIT

ALBANY, N.Y. (AP) -- New York's attorney general has filed suit against two tanning salon chains, accusing them of downplaying health risks while playing up the allure of bronze skin.

Attorney General Eric Schneiderman (SHNEYE'-dur-muhn) filed the lawsuits against Portofino Spas and Total Tan Thursday. He says both franchises falsely advertise the health benefits of indoor tanning by promoting it as a safe alternative to tanning outdoors.

Schneiderman says there's nothing safe about indoor tanning. He accuses the two companies of supporting the opposite message.

Attorneys for Total Tan denied the allegations. Representatives for Portofino didn't immediately respond to requests for comment.

Schneiderman says lawsuits are also coming against Planet Fitness and Beach Bum Tanning.

A spokesman for Planet Fitness says the company is working toward a resolution. Representatives for Beach Bum Tanning didn't comment.

GENERAL MOTORS-EXECUTIVE COMPENSATION

DETROIT (AP) -- General Motors CEO Mary Barra's compensation more than tripled in 2014 to $15.8 million in her tumultuous first year in the automaker's top job.

Barra and other top executives got only 74 percent of the cash incentives they could have received, because GM fell short of goals set by the board. But her stock awards more than doubled from 2013 when she was senior vice president of for product development and purchasing.

GM reported its 2014 compensation Friday in its proxy filing with the U.S. Securities and Exchange Commission. The company also announced that its annual stockholders meeting will be held on June 9 at GM's Detroit headquarters.

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