Sunday, April 19, 2009

Rahm Emanuel Channels Denny Shelton, Legacy Health CEO

President Obama's Chief of Staff spoke on ABC's This Week with George Stephanopoulos. His remarks on health care reform are below:

EMANUEL: Well, first of all, what we have to do is squeeze out all the basic costs in the system, before we talk about any other type of revenue. There's a lot that has to be changed.

Unfortunately, I know a little about health care reform from my family. The fact is, we had all the wrong incentives in the health care system. And if you change the incentives toward medical I.T., which we put in place the resources to start basically having a way to control costs there; if we change the way the doctors are paid -- so, rather than fee for service, for outcomes; change the way -- in fact, rewarding people who take care of themselves and get their health together. All those are what you have to consider.. (CROSSTALK)

STEPHANOPOULOS: But all of that is only going to get you a fraction of the place where you need to be in order to cover everyone as the president has said is the goal as well. And he laid out a plan, a reserve package of about $600 billion; the plan he laid out to pay for it, shaving deductions for wealthy Americans. Democrats and Republicans alike on Capitol Hill say, no way, we're not going to do it. So how is the president going to fill the gap? How is he going to pay for the programs?

EMANUEL: Well, (inaudible) George, it's not just the president. It's what we work with Congress. That process is beginning. I think, in this next five weeks, you'll see tremendous progress at the -- at the committee level, to getting that done. And he does not believe that's the first step. And what you have to do, as he believes, is make the cuts in the system that we have today because we're overpaying for a lot of things; and second, is change the incentives before you get to immediately going to a default position that you have to raise taxes.

STEPHANOPOULOS: But is he open to taxing employer benefits?

EMANUEL: He -- he has said he opposed that, as he said in the campaign. And that's what he believes, and believes is, before you get there, you have got to address the priorities.

STEPHANOPOULOS: So he won't sign a bill that includes that?

EMANUEL: George, I'm not going to do any absolutes on your show.

That's odd. The New York Times said President Obama is now open to taxing employer paid health insurance. As for driving basic costs from the system, where have I heard that before?

Ex-Triad Hospitals CEO Denny Shelton used those words at an Angelo State University session on the Future of Healthcare. Mr. Shelton just made over $40 million in the sale of his for-profit hospital company. He said:

He'd be willing to pay more taxes once "inefficiencies" are driven out of the system.

What does Denny Shelton have to do with White House lingo on health reform? Mr. Shelton worked alongside White House Health Czar Nancy-Ann DeParle. She served on the Triad Board of Directors and grossed $1.4 million on Triad's sale. That relationship grew when Nancy-Ann's CCMP Capital Partners hired Denny Shelton as a health care investment adviser. CCMP then bankrolled Denny's newest for-profit hospital venture, Legacy Health Partners.

Ms. DeParle knows the business case for health care reform. Denny advised her and Nancy-Ann is now advising Rahm Emanuel. The race to the global lowest common denominator on worker pay/benefits continues. Taxing employer health insurance (while keep individual deductibility) is a prescription for businesses to dump responsibility for health coverage on to the worker. Sound familiar? It's a Wyden plan with lipstick. Nancy Ann, Denny and Rahm know how to apply it.