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The latest news on Obamacare from Business Insider

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    Even though Obamacare was decided months ago, pundits are still dissecting the court's actions.

    CNN's top legal analyst Jeffrey Toobin and famed lawyer and author Alan Dershowitz sat down on Friday at New York's 92nd Street Y to debate why Chief Justice John Roberts used his deciding vote to pass President Barack Obama's controversial health care law.

    And, according to Dershowitz, Roberts did it just so he could side with Republicans from now on without getting called out for being too conservative.

    "Roberts is very political," Dershowitz said in the interview, posted by Above The Law. "And what he did by writing the decision the way he did is No. 1, he gave himself a lot of street cred or court cred which will allow him to render very conservative decisions for a long period of time without being regarded as the 5-to-4 guy who always votes Republican."

    Plus, by writing the majority opinion the way he did, Roberts was able to "stick it in some ways to Obama by calling it a tax," Dershowitz said.

    Watch the full interview, courtesy of ATL:

    DON'T MISS: Wisconsin Lawmakers Are Taking A Radical Step Fight In Their Against Obamacare >

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    Obamacare Protest

    When House Speaker John Boehner declared Obamacare the “law of the land” two days after his party took a drubbing in the election, the real reveal came in what happened next: he walked it back in record speed and re-affirmed his commitment to getting rid of it.

    Having failed to repeal the Affordable Care Act at the national level, Republicans are now dedicating their efforts to botching its implementation at the state level.

    And having failed to invalidate the law at the Supreme Court, they’re now seeking alternate legal avenues to weaken its regulations.

    Republican governors are turning down the law’s Medicaid expansion, a move made easier by the Supreme Court decision that made the expansion optional.

    Among them are Bobby Jindal of Louisiana, Phil Bryant of Mississippi and Nikki Haley of South Carolina.

    Given that the federal government pays the vast majority of the cost in the medium term, these states are, in effect, rejecting an extraordinarily generous financial incentive to insure their residents.

    Implementing the expansion in full would insure about 17 million people. “If [many states] don’t accept the Medicaid expansion you’re going to have millions of low income Americans who will remain uninsured and without access to health care,” said Tim Jost, a health care expert at Washington and Lee University who supports the Affordable Care Act.

    Some dozen Republican governors are refusing— and about a dozen more are considering refusing — to build state-based insurance exchanges, the law’s primary vehicle for expanding and improving coverage. These governors, which include John Kasich of Ohio, Rick Perry of Texas, Nathan Deal of Georgia and Mary Fallin of Oklahoma, are consequently empowering the federal government to build one for them.

    The law does not set aside funds for the federal government to construct or operate exchanges, creating implementation headaches for the Obama administration. But it can be self-sustained through user fees, and Jost argues that state residents with governors who are uncommitted would be better served by a federal exchange that wants to cover them.

    Conservative thinkers are also resurrecting their argument, championed by top Republicans, that federally-administered exchanges lack the legal authority to provide tax subsidies, which are critical to making them work. Although the language of the law is vague on this question, the IRS has said federal exchanges are permitted to provide the premium subsidies.

    “I don’t believe they’re going to win on that one,” Jost said. “If they did win that would do serious damage to what Congress intended, which is to have a federal fallback exchange.”

    Utah Gov. Gary Herbert (R) is flirting with continuing his state’s existing insurance exchange even though it does not comply with rules in the Affordable Care Act.

    Meanwhile, conservative advocates are advancing a separate legal challenge to the law’s requirement that insurance plans cover contraception for women as part of a copay-free preventive services package. Cheered on by congressional Republicans, Catholic institutions such as the Archdiocese of Washington and University of Notre Dame are moving forward with lawsuits that could end up in the Supreme Court.

    All in all, Republicans and conservatives are telegraphing that they’re not chastened by years of failed efforts to wipe away Obamacare. The crusade shows no signs of ending, and could still do serious damage to the law.

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    The Supreme Court on Monday arranged for a Virginia university to go forward with new challenges to two key sections of the new federal health care law — the individual and employer mandates to have insurance coverage. 

    The Court did so by returning the case of Liberty University v. Geithner (docket 11-438) to the Fourth Circuit Court to consider those challenges. 

    The Court last Term had simply denied review of Liberty University’s appeal, but on Monday wiped out that order and agreed to send the case back to the appeals court in Richmond for further review.

    The Court did not grant any new cases, but did dispose of one new case with a summary ruling.  In Nitro-Lift Technologies v. Howard (11-1377), the Court ruled that the Oklahoma Supreme Court was wrong in preventing arbitration of a dispute over the scope of non-competition agreements in employment contracts.

    Among the Court’s more significant orders denying review, it refused to hear a claim that the Constitution requires states to allow an accused an opportunity to use insanity as a defense to a criminal charge.   The case of Delling v. Idaho (11-1515) was denied over the dissents of three Justices— Stephen G. Breyer, joined by Ruth Bader Ginsburg and Sonia Sotomayor.  (Disclosure: attorneys who have roles in the publication of this blog were involved as attorneys in this case.  The author of this post operates independently of their law practice.)

    The Court’s decision last Term on the new health care law upheld, under Congress’s power to tax, the requirement that virtually all Americans have health insurance by 2014, or pay a penalty.   That is the individual mandate.  The law also contains a somewhat similar mandate, requiring all employers with more than fifty employees to provide them with adequate insurance coverage.  The Court had declined to rule on that issue last Term.

    Liberty University has been pursuing a challenge to both mandates, based on claims that they violate rights to religious freedom or to legal equality under the Constitution. 

    The Fourth Circuit had not ruled on either of those claims, because it ruled that Liberty was barred by the Federal Anti-Injunction Act from suing to stop those mandates.  That is one of the issues the Circuit Court will have to reconsider when the case is returned there. The Court cleared the way for doing so by vacating and remanding the Circuit Court’s earlier decision.

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    Stop, health care sign

    The Supreme Court decided today to give Liberty College another chance at challenging two key sections of the health care law — the individual and the employer mandates for insurance coverage.

    This ruling doesn't mean the court agrees with the Virginia university's arguments.

    Rather, the high court is agreeing to give the case another shot in a federal court of appeals.

    But why?

    The Fourth Circuit ruled the school's lawsuit was premature because the college was suing over a tax before it had been collected, a violation of the Anti-Injunction Act, Forbes reported.

    In March, however, when the Supreme Court ruled to uphold most of the Affordable Care Act, it also said that the Anti-Injunction Act could not prevent challenges to the individual mandate, according to The Hill.

    In light of that decision, Liberty asked for the Supreme Court to send its case back down to the federal appeals court so that a new hearing may be held.

    The main challengers to the Affordable Care Act, who lost their case in June, argued the insurance mandate violated the section of the Constitution that regulates interstate commerce.

    Liberty, which was founded by the late Jerry Fallwell, argued Obamacare also violated its religious freedom because it would require the school to pay for health insurance that funded abortion, the Hill reported.

    SEE ALSO:The Supreme Court Just Paved The Way For Another Obamacare Fight >

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    Toby Cosgrove

    The business of healthcare is changing rapidly. New legislation, the pace of medical innovation, and an older and more obese population mean the way we do things is going to have to change. 

    We spoke to Dr. Delos ("Toby") Cosgrove, the CEO of the Cleveland Clinic, which is regarded as one of the most innovative hospital systems in the United States on these massive trends.   

    Consolidation is coming

    During our conversation, Dr. Cosgrove pointed out that all of those trends, accelerated by the cost pressures of the Affordable Care Act, are pushing the industry in one direction — consolidation. "When you look at industries in the United States, particularly low margin businesses — and healthcare is clearly a low margin business — you figure that 25 percent of the hospitals right now are in the red, so it's very low margin." Cosgrove said. "What happened to airlines, what happened to supermarkets, what happened to bookstores? They all consolidated, they brought scale so they could drive efficiency. I think that's what's happening in healthcare right now." 

    As a result, as Dr. Cosgrove says, "Hospitals are coming together in systems and systems are beginning to talk to systems." His own Cleveland Clinic is talking to three facilities in the area about joining up. 

    It's not just costs, healthcare has gotten more complex

    It's not just about costs and margins, it's the increasing complexity of the healthcare business. "If you look at the back office, what it takes to drive a hospital now or even a doctor's office, the IT, the contracting, the purchasing, you get advantages from scale." Dr. Cosgrove said. "Simply, the dynamics are driving it, because it's all so complicated to do it in private practice. I mean, think about the explosion of knowledge there's been in healthcare. Docs don't want to practice by themselves anymore, they simply can't scrounge up all of the knowledge they need, so they're looking too team up with other people to do it." 

    A great example is Dr. Cosgrove's own experience as a surgeon before he became CEO. "I started out as a chest surgeon. I used to do esophageal surgery, lungs, coronary bypasses, aortic aneurysms, valve surgery. Now you have doctors who do just esophageal or lung surgery, I did just valve surgery by the end of my career. The knowledge and the expertise has gotten so big that you've got to narrow your field." 

    When fields narrow, it becomes increasingly difficult to have small practices.

    Healthcare is the second largest industry in the country

    Consolidation's not just huge news for healthcare. It's huge news for the economy. For one thing, healthcare is one of the biggest employers in the country. Dr. Cosgrove argues that employment is just the beginning of the impact. "It's not just employment, I mean its 24 percent of the federal budget. After restaurants and hospitality, this is the biggest industry in the United States. It's big business news." Dr. Cosgrove said, "It was big news when the airlines started to consolidate. This is a much bigger industry."

    Larger hospital systems are going to compete with each other, have increasing influence over the labor market, and change how policy works.

    It's going to change how we experience healthcare. 

    Hospitals systems can't just get bigger, they have to get better

    Though the idea of losing small family practices might seems scary, it's not all bad. These cost pressures don't just mean hospitals have to get bigger. That won't be enough. They have to get better.

    Systems like the Cleveland Clinic are already starting that process, its doctors are on salaries rather than being paid by procedure to emphasize quality over quantity of care. Also, the system's hospitals are organized around patient needs rather than keeping the traditional division between medicine and surgery, which is both more efficient and better for the patient.

    Check War Room over the next few days for more from Dr. Cosgrove on how exactly the healthcare business can and needs to change.

    NOW READ: The US 20: Twenty Big Trends That Will Dominate America's Future

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    supreme court obamacare

    Obamacare supporters rejoiced in June when the Supreme Court ruled the U.S. could use its taxing authority to mandate that most people buy health insurance.

    But their celebrations may have been a bit premature.

    The Affordable Care Act faces other legal hurdles—including a challenge that only could have been made after the Supreme Court’s ruling.

    The right-leaning Pacific Legal Foundation amended its challenge to the ACA after the Supreme Court upheld the insurance mandate under Congress’ taxing powers.

    The group's challenge turns on the Origination Clause in the U.S. Constitution, which requires that bills for raising revenue start in the House of Representatives.

    Problem is, the group argues, Obamacare started in the Senate.

    The clause has one loophole that might be Obamacare’s salvation: the Origination Clause doesn’t apply to bills that create specific government programs for which the U.S. is trying to raise revenue.

    To argue against applying that loophole, Pacific Legal’s amended filing alleges the tax was instituted to fund general government revenues:

    Unlike the program-specific assessment and taxes at issue in Munoz-Flores, Millard, or Nebeker, the tax here is more akin to an income tax, whose revenues go to the general treasury and are used for general Government operations. NFIB, 132 S. Ct. at 2594 (comparing the Affordable Care Act tax to a tax on “earning income”). The tax is paid into the Treasury when individuals file their tax returns, and the amount is based on “such familiar factors as taxable income, number of dependents, and joint filing status.” Id. The requirement to pay is in the Internal Revenue Code and is enforced by the IRS, which “must assess and collect it ‘in the same manner as taxes.’” Id. (quoting the Act).

    Of course, it's not entirely clear whether Pacific Legal will ultimately prevail on this reasoning.

    Georgetown Law School Professor Randy Barnett thinks Pacific will be successful, contending the Senate used a "shell bill procedure" to "scoop out" the contents of a House bill and insert its own language.

    But that kind of "shell bill procedure" has been used a number of times to enact taxes, Jack Balkin, professor of constitutional law at Yale, wrote in The Atlantic.

    That tactic even worked in 1986 when the Senate passed sweeping tax reform under Ronald Reagan, he wrote.

    The case is currently under consideration in the D.C. District Court.

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    cheesecake factory

    Cheesecake Factory CEO David Overton isn't worried about Obamacare quite yet, but he says that he might be once he finds out the numbers.

    His company has been lauded as a model for the health care industry because it's so good at maintaining consistency and efficiency throughout its restaurants.

    Right now, Cheesecake Factory already covers everyone who works over 25 hours, so it's already paying quite a bit for healthcare.

    "We're not sure how much more it will be, how much less or what exactly we'll do,"said Overton on CBS This Morning. "So for us it won't be as bad as it will be for others, which it will be very costly."

    Overton noted that since he doesn't know the numbers yet, he's not sure whether he'll have to pass the costs on to the consumer by raising prices. 

    "I'm not worried yet," he said on CBS. "When I hear the numbers I might be."

    But Overton is concerned for other businesses that aren't already spending lots of money on healthcare.

    "For those businesses that don't cover their employees, they'll be in for a very expensive situation," he said. 

    Watch the full interview on CBS below: 

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    Red Lobster Ultimate Feast

    The CEO of Darden Restaurants is the latest restaurant executive to complain about Obamacare's effect on his business. 

    Darden, the parent company of Olive Garden, LongHorn Steakhouse and Red Lobster, is going to announce earnings next week and have already warned that results aren't going to be good. 

    CEO Clarence Otis blamed Obamacare for part of the problem. 

    The company lowered its profit and revenue projections for the quarter ended Nov. 25, also blaming bad promotions, Hurricane Sandy, purchasing its Yard House USA chain for the bad results, reports Tiffany Hsu at the Los Angeles Times. 

    Otis said there's been an impact from "negative media coverage that focused on Darden."

    "Earlier in the fall, Darden tested plans to cut back on healthcare costs by putting more workers on part-time schedules," Hsu reported. "President Obama’s healthcare law would slap Darden and other large companies with fines unless they offer basic health insurance for full-time workers."

    Restaurant chains and retailers haven't been shy about their hatred for Obamacare, which they say would hurt profits and force layoffs. 

    Cheesecake Factory CEO David Overtonspoke out about Obamacare yesterday, saying it was "very costly" for his business. 

    DON'T MISS: The Fabulous Life Of Amancio Ortega, The Mysterious Billionaire Behind Zara >

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    Healthchare Law, Obamacare

    In pushing to end Bush-era tax cuts, president Obama has argued that top taxes would only revert to levels seen during the Clinton years. 

    But in a Bloomberg View column, Alan D. Viard of the American Enterprise Institute argues that this isn't quite accurate  because there is a new tax that will come into effect next year that didn't exist during the Clinton era.

    Specifically, under Obamacare, those with incomes of over $200,000 ($250K for couples) will have to pay the unearned income Medicare Contribution Tax – a 3.8 percent tax on interest, dividends, capital gains, rents etc – that will come into effect on January 1. 

    There are a few problems with the tax.

    But the biggest problem according to Viard is that it punishes savers: 

    "The biggest issue, however, is the additional penalty the tax will impose on the savings that finance investment and fuel long-run economic growth. It’s true that relatively few Americans have high enough incomes to be subject to the tax. But they account for a large portion of what the nation saves, magnifying the economic impact.

    IRS data for 2010 reveal that the 3 percent of taxpayers with incomes of more than $200,000 received 45 percent of the interest income, 58 percent of the dividends and 88 percent of the capital gains (net of losses). More taxpayers and more saving will gradually become subject to the unearned income Medicare contribution tax in coming decades because its income thresholds won’t be adjusted for inflation.

    Even if the high-income portions of the 2001 and 2003 tax cuts are fully extended, the unearned income Medicare contribution tax’s arrival next year will raise the top rates on interest, dividends and capital gains 3.8 percentage points above this year’s levels. Or, if the high-income provisions are allowed to expire, it will push the top rates on interest, dividends and capital gains 3.8 percentage points above Clinton- era levels."

    Read the entire piece at Bloomberg View >

    SEE ALSO: America Faces Another Cliff That's $1.5 Trillion High, And It Could Send Interest Rates Plunging >

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    Toby Cosgrove

    We've already pulled some highlights from our extended conversation with Cleveland Clinic CEO Dr. Delos "Toby" Cosgrove on consolidation, cutting costs, and how health care will be disrupted.

    There was plenty of other great material, so we wanted to provide the Q&A in its entirety.  

    Here's a lightly edited transcript of our full conversation:

    Business Insider: What was it like being CEO of a big hospital when a law changed your entire industry?

    Dr. Cosgrove: The law has changed the industry completely, and I think the entire health care industry is anxious at this point, the anxiety is palpable. We're in an enormous period of change, and I think that period of change gives us tremendous opportunity. You've seen by the recent shout-outs we got in the presidential debates that we're being looked at a model as how to go forward, and I really think our model is our secret sauce. 

    What is it about the model that's made you successful?

    I think that there are a number of things that allow us to change as we need to. First of all, we're a medical group, we're physician- led, we make our decisions about how we're going to rule ourselves, what sort of facilities we're going to do, etc. The second thing is that all the physicians are salaried. We have no financial incentives to do more or to do less. We just try to look after what the needs are for a patient because it doesn't make a difference to us personally. The third thing is that we all have one year contracts, there's no tenure, and we have annual professional reviews. I don't know of another institution that has annual professional reviews and one year contracts. In the annual professional review we go over all individuals' contributions to the organization and that contributes to our decisions about what we do about salary and whether we reappoint or don't.

    I've had 37, by the way, 37 one-year contracts.

    Do people find that nerve wracking and do they adapt?

    No, I think people adapt quickly. You stop and think, almost every major business I can think of has annual reviews. And health care traditionally has not. You got privileges at a hospital and they were yours for life unless you committed murder or something. So, very seldom do people look at the qualities and the outcomes for the individual.

    A lot of the provisions of the Affordable Care Act aren't in place yet, have you made changes in advance?

    Well we've really been thinking that this is coming for a very long time. Even before the health care act was enacted we began to see the changes in health care. We thought, we're going to be under significant financial pressure and that health care has to change, and I think that's probably a point that's worth making with you. I think frankly there are huge changes that are going on in the health care business right now.

    One of those is the consolidation of providers, and by consolidation of providers I mean that hospitals are coming together in systems, right now we're talking to three facilities in our immediate area about potentially joining the Cleveland Clinic. Hospitals are coming together in systems and the systems are beginning to talk to systems, and if you stop and think about it, industry in the United States, particularly low margin businesses and health care is clearly a low margin business, and you figure that 25 percent of the hospitals right now are in the red, so very low margin. If you look at what happened in airlines, what happened in supermarkets, what happened in bookstores etc., they all consolidated, they brought scale so they could drive efficiency, I think that's what's happening in health care right now.

    Just because of the nature of the business, do you think that's going to be more difficult? 

    It's going to be more difficult because of the nature of the business, but I think that the financial pressures of the Affordable Care Act is going to drive this increasingly. You see the for profits for example, HCA has 160 hospitals, Community Health System has 136 hospitals, Tenet has 60 hospitals, the Catholics now are coming together and putting together big systems across the country. 60 percent of the hospitals now are part of a system, systems are talking to systems, we're talking to other systems and I think you're going to see an increasing amount of consolidation, and I think the reasons are pretty clear.

    If you look at the back office, what it takes to drive a hospital now or even a doctor's office, the IT, the contracting, the purchasing etc. you get advantages from scale, I think that's going to happen and I think, if you look at the consolidation, it was big news when the airlines started to consolidate. This is a much bigger industry.

    Especially in terms of employment, right? 

    I mean, its 24 percent of the federal budget, this is a huge industry. After restaurants and hospitality, this is the biggest industry in the United States. And so we'll start to see consolidation and it's big business news. And the other thing that will consolidate is providers, in the past most docs were sort of independent physicians who practiced either with two or three other guys or in small groups.

    What you're seeing now is that hospitals are coming together and docs are joining hospitals. Now 60 percent of the doctors in the United States are salaried, and we get inquiries every day from somebody who wants to come and join us. Simply put, the dynamics are driving it, because it's so complicated to do it in private practice. Think about the explosion of knowledge there's been in health care. Can you imagine trying to scrounge everything, all the knowledge there was in oncology without colleagues? So docs don't want to practice by themselves anymore, they simply can't scrounge all of the knowledge, so they're looking to team up with other people to do it.

    That's true even in specialties?

    The example I always use is myself. I started out as a chest surgeon. I used to do esophagus, lungs, coronary bypasses, aortic aneurysms, and valve surgery. Now you have doctors who just do esophageal surgery or lung surgery, I did just valve surgery by the end of my career. The knowledge and the expertise needed has gotten so big that you've got to narrow your field.

    Why is the pace of innovation so slow, if what you've done at the Cleveland Clinic's been so successful? 

    I have to tell you a cute story that I think speaks to your point. About two years ago, I was invited to the White House and I'm there with nine other CEOs of hospital systems, you know there's Columbia, the New York hospital system, Penn — hospital CEOs from all over the place. Everybody's given three or four minutes to tell their story of what they can do to improve health care delivery. I'm the last guy to talk and I described our system, how we're integrated and how we're all employed etc. And everybody says "Oh we couldn't do that." I said "wait a minute guys. How many of you would like to have that system?" Everybody raised their hand.

    So the point is that we're entrenched in a different system and we're going from an individual sport to a team sport, Getting everybody to change their head space is a big deal. And I think we're getting there now. Particularly because docs coming out of medical school, they want to be employed, they want to work for a big organization. 75 percent of them want to be salaried and as that changes, the individual entrepreneur doctor is going to be part of a system.

    I think the pendulum is moving fast, it's really amazing how fast things are changing.

    What was the particular change that your doctors and organization were most resistant to?

    Most hospitals are organized around the department of surgery, the department of medicine, the department of pediatrics — there was essentially a guild system for whatever your profession was. And what we said is, wouldn't it be nice to organize a hospital around what a patient needs? Novel idea, have a hospital organized around patients. If you've got a headache you don't know whether you need to see a psychologist, a neurologist, or a neurosurgeon. So let's put everybody who deals with a neurology system in a neurological institute, and we'll have one head. So if you go in for your headache, you can see whomever, right in that one location. Everybody whom you could potentially need to see is right there  in one location and they talk to each other, they're physically proximate to each other. 

    As opposed to bouncing around from department to department? 

    Right. So what happened out of this is, I went to the Head of Surgery and the Head of Medicine, and I said  that I think we need to change the system so we're organized around organ systems, so we've got somebody in cardiovascular, head and neck, neurologic, we put dermatology and plastic surgery together because they deal with the skin, urologists and neurologists together in the urological institute. So you guys are out of a job. There's going to be no Chief Of Medicine and no Chief of Surgery anymore. They said ok, we agree. I told them that they were great guys and that there was going to be a place in the organization for them and that they'd have an important leadership job, but that we were going to do away with those jobs. 

    So the whole organization was anxious, and we stared one by one to move people to various locations, and finally everybody was so nervous that we said we're just going to do the whole thing. In one year we changed the whole organization, so there's no more department of surgery, no more department of medicine, it's all by institutes.

    And I think that's an example not of beating guys over the head, this was an example of, nobody came to me and said that's a terrible idea not one person but everybody was anxious. And nobody not one person has come to me and said we have to go back.

    So everybody could see the value of doing it, but it created tremendous anxiety.

    How did you change when you transitioned from being a surgeon to a CEO?

    I had to change my clothes. I had to go out and buy a suit. I had to go from surgical scrubs to suits and ties, it was very expensive. Anyhow, everything in my life changed. I changed where I lived, I went from the operating room where I used to spend 12 hours a day to the boardroom. I changed who I talked to, it was not patients anymore it was whole constituencies of people.

    And I had to change what I read, I went from the New England Journal of Medicine to the Harvard Business Review. But the biggest change of all was the change in the immediacy of decisions. I made a decision in the operating room, and you know right away if it was a good decision or a bad decision. Now you make a decision and you may find out two years later. So I had to learn to live with ambiguity better than I had in the past.

    It was also a huge change in my personal and public persona. I used to go places for a dinner party with my wife and people would say "Oh, you're Anita Cosgrove's husband." Now you know I remember that this struck me instantly, right after it was announced I went to buy a Christmas present, and by the time I got from picking it up to paying for it and getting out of there I got stopped four times. Somebody wanted a job, somebody wanted to complain, somebody wanted to thank me, somebody wanted to congratulate me. I'd go to a basketball game and I'm busted for eating a hot dog and they blog about it. I became a very public figure which was a big change.

    So I don't go to any restaurants in Cleveland without talking to three or four people.

    I know you have a system that helps doctors patent their inventions, could you tell me a bit more about that?

    It's a very long journey actually. The journey started when, in my first five years at the Clinic which was 30 years ago now, I developed with another guy a closed loop system for giving a drug. So, we essentially learned about how to keep a patient's blood pressure at a certain level by putting a drug in. We developed it, we found a patent lawyer to do it, I negotiated with companies and convinced a company to manufacture it, put together a payment program, and one day I walked in and gave the CEO a check for 50 grand. That was more than my salary at the time, I thought it was a really big deal.

    And he said, "Jeez, we could make some money out of this," and I said, "Yeah, we probably could." We started out at that point with a guy named David Morganthaler, who was one of the original venture capitalists with Morganthaler Partners and was on the board, and we started to vet all of the stuff that doctors would suggest. For 20 years we couldn't quite get it right.

    About 10 years ago we put a bit more emphasis on it and went out and hired a guy by the name of Chris Colburn and he's really developed the tech transfer arm of the Cleveland Clinic. We own all of our intellectual property, all of my patents and devices are owned by the Clinic. So he is charged with taking the tech that the doctors think about and develop with the Clinic and commercializing it. That may be licensing, that may be a startup, and so on. In the last 10 or 12 years we have gotten almost 500 patents, another 1400 filed for, and 52 companies spun out.

    Now the interesting sort of validation of this idea was that other people have started to realize how hard this is to do. You have to get the lawyers, the financing, the vetting figured out, you have to figure out how to do negotiations with business and so on.  That's not stuff that comes naturally to a doc. They're now bringing the model to other institutions. Long Island Jewish signed up, Medstar in Washington has signed up, Ohio State has signed up, Notre Dame signed up, and there are about six others that have signed up.

    They've decided to essentially rent rather than build, and we do the tech transfer for those orgs. Medstar is a great example. The year before we started representing them, they had no disclosures of potential ideas from their staff, the next year they had more than 100. They're getting their first patents and starting to get their first set of royalties. So it works. It's been a very long, painful process and it's taken a lot of failures to get this set up, but now we have something that works for us and works for other people as well. 

    You mentioned, in reference to the Affordable Care Act that those cost pressures are going to drive consolidation. Usually when we talk about cost pressures in business it's with horror in our voices. But it sounds like, if it drives towards more efficiency, it might be a net positive in this case?

    I think that's a very good observation and it probably could be a net positive. We're really moving to trying and drive value, and as you know, value comes from measuring quality and cost. We haven't had very good measurements of either one of those in the past. On the quality thing, we really started measuring quality in cardiac surgery 30 years ago or more and that was pretty easy because people either did or didn't, they walked out or got carried out. So the endpoints were pretty easy, but what we found out as we measured it, is that the more we measured the more we found problems. And when you found a problem you could really sort of screw down into it and find out what the root of it was, and begin to deal with that particular issue. And what resulted is that we got better and better as we went along.

    So then we did the same thing starting 8 years ago for each one of our institutes, saying that now you have to start to make your costs transparent and measurable. So now each one of our institutes has an outcomes book, it's on the web. Each year they've gotten a little bit better in what they report and the sophistication of what they report. Each year they're able to look at their own results and say, we can do better.

    On the cost end of things, it's a lot easier to measure dollars than it is outcomes, but cost has almost been looked at as what you get paid to do something, not what it costs to do it. Over the years we've begun to understand how much it costs to do each one of our procedures. For example, we've asked each of our institutes to go and look at the cost of their number one, or two, or three thing that they do. The urologists looked at prostetectomies, they looked at the cost of the sutures, how many instruments they had on the table, how long the patients stay in the recovery room, etc. and they were able to take 25 percent out of the actual cost of what they did. We did the same thing for cardiac surgery, did the same thing for liver transplants, and so on.

    So now that we really have a capacity to look at each one of the issues and how much it costs, we're able to really begin to reduce the costs and we have to do that as an industry, just because of the importance of that for the United States.

    And if we don't, we're not going to be able to avoid the financial problems that we have as far as debt is concerned unless we control health care costs. 

    Increasing costs are sort of a demographic inevitability, right?

    It's interesting, I looked at a graph the other day of about 6 countries around the world. Every one of their curves of cost escalation mimics ours. They're all advancing faster than GDP is, they're all going faster than the increase in salaries. So everybody's got the same problem. They may start from a lower level, but they're all headed in the same direction. It's demographics, and its also, think about what we can do now that we couldn't 50 years ago. That's not free. 

    I think there are two aspects to this, and I don't think we've really put our emphasis on exactly the right things. Really everything we talked about is making the delivery of care to sick people more efficient. Consolidating hospitals, buying better, avoiding waste, all that sort of stuff.

    The only other way we're going to be able to reduce the cost is by reducing chronic illness. And that's smoking, that's obesity. Obesity now accounts for 10 percent of health care costs and will go to 20 percent over the next 10 years. We're not going to control costs unless we deal with that.

    If you could go back to the beginning of your tenure, what would you do differently?

    "I was incredibly naive when I started. The funniest part of my naïveté is when I stood up in my first speech to the Clinic, and I said that I thought the most important asset to the Cleveland Clinic was all of you employees, that we had to take good care of you, and we had to get you good food, even if that meant we had to get rid of the McDonald's. That precipitated a huge fight with McDonald's, it resulted in me being on the front page of the Washington Post above the fold being referred to as the "big mac attacker." It gets even funnier in retrospect, at the time it wasn't very funny at all.

    So I didn't realize that the franchise for the Cleveland Clinic had a very long contract and this became a very public fight, so I decided that we had to have some sort of reconciliation. I was introduced through a mutual friend to the chairman of the board at McDonald's.

    So I  went out to Hamburger University in Chicago to talk with them, I walk in to this conference room and there's the CEO, the chairman of the board, the head chef with his hat, about 10 people, and me! And they said, "Well Dr. Cosgrove, what can we do for you?" And I say, "Well, you seem like very nice people, and you obviously have a lot of great stores all over the place, and I'd love to have you at the Cleveland Clinic, if you'd just get rid of the Big Mac and the French Fries."

    Well, you should have seen the expressions on their faces.

    We ended up having a serious discussion of trans fats, they were in the process of taking the trans fats out of their fried foods and the french fries, which they've subsequently completely done. They took the cheeseburger out of our cafeterias, they brought in apple slices and they changed the advertising, so we made some progress and we probably added our voice to changing McDonald's in a good way in the right direction

    But I don't think knowing what I know now that I would do that again.

    What about the idea that we're going to have a shortage of doctors?

    I don't there's a question that there aren't going to be enough docs. We're going to have to employ people like physician's assistants and nurse clinicians who work to the top of their licenses. And we're going to have to figure out how to make docs more efficient in the way they see people. We've done this, for example, with group visits where you can see 10 people with the same problem at the same time so you don't have to repeat the advice to a diabetic 10 times; you can do it all at once the patients love it, the doctors like it, and for a long time we've had doctors supported by nurse clinicians and PAs.

    We have about 80 physician extenders in cardiac surgery alone, and they allow for really great practices. For example, they allow the surgeon to stay in the operating room. Instead of running all over the hospital finding x-rays, taking out stitches, pulling out chest tubes, and changing dressings, you get to spend your time where it really counts, in the operating room and they do the other things. It's great for the surgeon, it's also great for the patient because [the assistants] know exactly how I want it done and they do it time after time after time that way because that's their job. And as a result, the patient gets better care. So it improves the quality of the care. We're going to see more and more of that.

    I think we're going to see more virtual visits come in, tele-health being employed because there's not going to be a primary care physician in "East Overshoot." That's not going to be big enough. So there'll be some sort of way that you can connect with either a medical center or caregiver some place to get that sort of advice.

    Right now, we think everybody needs to see a doctor every time. We've got nurses at CVS in the Cleveland area and they have 450 or 470 where they do that. I talked to the CEO of Walgreens the other day and they have 8,000 facilities across the United States, their pharmacists have come out from behind the counter, they're now giving flu shots. I think that you're going to see a disruption in the primary care from those locations.

    That's where the next disruption health care is going to come from?

    Disruption always starts at the bottom end of the food chain. Look at the mini mills that started doing rebar. Honda started making motor cycles, then cheap cars, then very sophisticated cars, Clay Christensen talks about that all the time, disruption starts where you don't expect to see it, at the low end of things.

    I think that's going to happen in health care and I've been looking for it. Disruption is going to happen at the pharmacy rather than the teaching hospital. It's going to be hard to change heart surgery or neurosurgery very fast. But you can change that primary care stage, and you're going to be able to do more and more things at that primary care level as you disperse the care to where the population is.

    The other thing while we're talking about this is really the question of access. And you stop and think about what they talk about in Washington about access, it's about insurance. That's not actually getting in to see somebody to look after you. What access is, is getting in to see somebody.

    Over time, what we have done is we've increased our ability to be responsive to demands for access. The first thing we did is have a nurse on call so if your kid gets a fever of 103 in the middle of the night, you can call our nurse on call and get advice, and they have a whole protocol for various things. The second thing we learned was from a patient who called up for an appointment to see a urologist and got one in two weeks. It turns out the patient was in acute urinary retention and couldn't pee and needed to be seen right away. What we learned from that is when a patient calls up for an appointment, you don't know what they've got. And so we ask them all, would you like to, or do you need to, be seen today? And so we put a same-day access policy across our entire organizations.

    So last year we saw 1 million same-day appointments, and 98 percent of the people who asked for a same-day appointment got one. Then we went to our emergency rooms. Emergency rooms are traditionally known for making you wait forever. Our waiting time on average across all of our hospitals is 20 minutes and we did that by changing how you entered.

    When people came into an emergency room, they all used to get treated the same way. You'd take your clothes off and get in bed. A lot of people would walk in and say I've got a sore throat or I've got wax in my ear or something like that. What we do is say, "OK, you go over here and sit in this chair and we'll do the throat swab or clean your ear out and you're gone." And the people who come in and say "I'm having a heart attack" or I'm coughing up blood," they get in bed. So the time from the door to the doctor has been compressed.

    Another big trend in health care is our aging population, how do we address that? 

    First of all, the diseases have changed. If you look at the top causes of death in the United States, six out of the seven are chronic diseases. Chronic diseases are not going to be taken care of in a hospital. They're going to be taken care of as outpatients or through home care. We've done two things in that respect. Last year we added three more outpatient facilities, we're not building more hospital beds, we're building outpatient facilities to take care of the chronic diseases. The second thing is that we've vastly increased our home care. Increasingly we've gone from hospice in-facility to hospice at home, and added more and more home care, and we're able to do more and more things.

    Another issue is people who get readmitted. They leave the hospital, then they go to the nursing home and so we are now moving into increasing our concentration on interfacing with our nursing homes. We're selecting a few nursing homes and sending our patients there, and having our doctors visit them and bring the electronic medical record there so we have continuous care.

    There are two things that happen there. One it'll reduce the readmissions that come back from the nursing homes because they haven't been looked after, and the second thing it'll do, traditionally, people went to the nursing home and stayed 29 days whether they needed it or not. Now we'll get them out of there sooner, which will reduce the cost cycle.

    What would you like to see next from Washington?

    I'd like to see more emphasis on wellness. And that's a really tough one for a country, but I think if we don't address it, health care costs are just going to keep going up. One of my concerns, just look at obesity. One of the most powerful lobbyist groups in Washington is the sugar industry. I think we're going to need some help from Washington, but I don't think they'll be able to do it entirely. They're going to have to have a coalition of government, health care providers, educators, food providers and food manufacturers.

    We have to do the same thing for obesity that we did for smoking, but it took us 50 years for smoking. We can't afford to do that — we have to have it happen and we have to raise the consciousness about the epidemic of this disease.

    What's your advice for CEOs who want to, or needs to, dramatically change their company?

    I think the most important thing you have to do is communicate. One of the things I read about Jack Welch, he said when he became the head of GE he grabbed the microphone. And I grabbed the microphone right after I became CEO. I probably spent half of my time talking to people. I think when people begin to understand the issues they're more willing to change.

    Four times a year we have what we call Connections that I televise to all of our locations and talk to them for an hour about all of the issues. The second thing that we do is that we've doubled the number of staff meetings we have a year for docs to come and hear the message. Then I go and I meet with each institute, I do one a week, I go to each one of our locations once a month, we blog, we have weekly papers, we take every opportunity we can.

    I think part of my obligation as a CEO is to talk about the Cleveland Clinic outside and talk to the people at the Cleveland Clinic about what's going on in the rest of the world. There is a unique opportunity for a CEO to bridge that gap of communication back and forth. When people understand what the forces are, they're more willing to change. If you talk to them and if you listen to them about their concerns and address them in a very straightforward manner and don't try and B.S. them, then they are much more responsive. I think that communication is vital and you can't do it enough, it's amazing.

    You just can't do it enough.

    NOW READ: 30 People With 'Soft' College Majors Who Became Extremely Successful

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    warren buffet

    It's been a big year for politics. 

    From landmark court decision to seismic shifts in gay marriage and marijuana legislation, to a historic election in which more money was spent and more tweets sent than ever before, the events of 2012 have reshaped the U.S. political landscape, and changed the direction we will take going forward. 

    Over the course of it all, a group of people emerged who wielded outsize influence and power over the way that the political winds blew this year. We've taken stock of these movers and shakers and narrowed the list down to 36 people who, whether it was from behind the scenes or in the center of the media spotlight, left their indelible mark on U.S. politics in 2012. 

    Bill Clinton

    Former U.S. President

    Unable to resist the lure of a presidential race, Clinton hit the trail for President Barack Obama, campaigning tirelessly as the Democratic Party's most effective surrogate.

    Clinton's incredible speech at the Democratic National Convention made a powerful case for Obama's second term, and articulated the party's message in a way that no other Democrat had previously been able to do. The moment arguably won the election for Obama, giving the President a huge boost that carried him through the fall campaign. 

    Now here are all the reasons to be excited about Clinton's comeback > 

    Chris Christie

    Governor, New Jersey

    Despite passing up the chance to run for president in 2012, Christie emerged as one of the leading figures of the Republican Party, possibly setting himself up for a 2016 White House bid. 

    So great was Christie's influence in the 2012 election that Republicans have even blamed him for Mitt Romney's loss, as a result of the New Jersey Governor's Hurricane Sandy embrace of Obama in the final days of the campaign.

    But in the wake of the storm, Christie has defied odds in a blue state to become New Jersey’s most popular governor ever. Although Christie has already announced his intention to run for re-election in New Jersey in 2013, he is likely to continue to wield lots of power over his party at a national level. 

    Here's a look back at Christie's breakout year > 

    Michael Bloomberg

    Mayor, New York City

    To get an idea of Bloomberg's influence, consider this: Is there any other political figure with the power to even consider banning soda? 

    Bloomberg continued to drive the conversation on two major issues about which he feels passionately — gun control and climate change. In October, he announced the formation of a super PAC supporting candidates who advocate for increased gun control measures, gay marriage and education reform.

    His biggest contribution to the political discussion came in early November, when he almost single-handedly made climate change an issue in the final days of the election. In the wake of Hurricane Sandy, he gave his endorsement to Obama, saying the President would be best on handling the issue.

    Now, as political attention turns to gun control in the aftermath of the Sandy Hook Elementary School massacre, Bloomberg is once again at the center of the debate as one of the most vocal advocates for curbing gun violence. 

    See the rest of the story at Business Insider

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    Justice Antonin Scalia has long been called the most outspoken member of the Supreme Court.

    And a look back at the grumpy jurist's opinions really reinforces that label.

    Take a look at some of the most curmudgeonly things the controversial justice said in 2012:

    • In September, the famously conservative justice flipped out at a reporter for suggesting the court is politicized, while defending politicians in the same breath for making political appointments. "It really enrages me to hear people refer to it as a politicized court. Maybe the legislature and the president are not as stupid as you think. They assuredly picked those people because of who they are and when they get to the court they remain who they were."

    • He also blasted reporters for questioning whether Chief Justice John Roberts changed his mind at the last minute, ensuring a favorable Obamacare ruling. "I don't talk about internal court proceedings," Scalia said in July, according to The Huffington Post."A reporter who reports that is either a) lying, which can be done with impunity ... or b) that reporter had the information from someone who was breaking the oath of confidentiality, which means that's an unreliable person."

    • Scalia made it clear he doesn't have a problem ruling on some of America's most politically charged issues. "The death penalty? Give me a break. It's easy. Abortion? Absolutely easy. Nobody ever thought the Constitution prevented restrictions on abortion. Homosexual sodomy? Come on. For 200 years, it was criminal in every state," Scalia said in October at the American Enterprise Institute, according to The Associated Press.

    • He also stuck to his views equating laws banning sodomy to laws against bestiality and murder. "It's a form of argument that I thought you would have known, which is called the 'reduction to the absurd,'" Scalia said in December while at Princeton University."If we cannot have moral feelings against homosexuality, can we have it against murder? Can we have it against other things?"

    • Scalia isn't impressed with America's grammar and isn't afraid to show it. The justice bemoaned "the illiterates who communicate with the public" after a flight attendant said "it's required that your luggage is under the seat in front of you" rather than "be under the seat."

    • When a law student at University of Wyoming asked Scalia what classes she should take, he said she should skip the "frill classes" like women in justice. "Take the bread and butter courses. Do not take 'law and women,' do not take 'law and poverty,' do not take 'law and anything,'" he said, adding that many professors like to "teach their hobbies."

    • When discussing his new book with Charlie Rose, Scalia stuck to his opinion that he's always right and his dissenters are wrong, saying that while he knows there are disputes over his views, "I also recognize that there is right and wrong."

    • Scalia also boasted to Rose about his numerous enemies, saying, "A man who has made no enemies is probably not a very good man."

    DON'T MISS: Justice Scalia Has A History Of Trying To Block Freedom Of The Press >

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    obamacare protest

    Almost immediately after the Supreme Court ruled in favor of President Barack Obama's sweeping health care reform, opponents began attacking the law from new angles.

    The Supreme Court upheld the heart of the Affordable Care Act in June in a 5-4 vote.

    But even though the individual insurance mandate — the most controversial part of the law — was upheld, opponents still have plenty of problems with Obamacare.

    The Affordable Care Act is so unpopular with some it has an entire website dedicated to all of the lawsuits against it.

    Here's a look at some of the big challenges you can expect to see making headlines this year:

    Congress' ability to enact such a law in the first place

    In its lawsuit, the conservative Pacific Legal Foundation is arguing that if Obamacare is a tax, as the Supreme Court ruled it is, then it's unconstitutional. Tax bills must start in the House, but Obamacare started in the Senate, the group points out.

    “Especially after the election of 2012, PLF is now on the front line in defending the rights of Americans against Obamacare’s violations of core constitutional principles,” PLF Principal Attorney Paul J. Beard II said in a November statement on the group's website. “Our commitment is strengthened, and our fight goes on.”

    But, that fight might be short-lived, the National Law Journal's Marcia Coyle told PBS Newshour.

    "Some court scholars see this lawsuit as a long shot because courts in the past have given Congress a lot of deference with legislation passed in a similar fashion," she told Newshour.


    Obamacare mandates that insurers cover contraception, testing for some STDs, as well as well-woman visits, The Houston Chronicle reported in July.

    Those mandates have spawned at least 42 challenges claiming Obamacare infringes on employers' religious beliefs, Coyle told Newshour.

    While religious institutions such as churches and some hospitals are exempt from the requirement, for-profit companies aren't entitled to the same exemption.

    "The Department of Health and Human Services issued an interim rule in August 2011 that exempted certain organizations with religious objections to contraception," Coyle told PBS. "A number of religious colleges and other employers sued, claiming the contraception mandate violates their deeply held religious beliefs."

    The Supreme Court last month refused to grant an emergency appeal filed by one of those employers, Hobby Lobby, an arts and crafts company with Christian owners.

    However, Hobby Lobby and other companies with religious owners can continue pursuing their Obamacare challenges in the lower courts and ask the Supreme Court to hear the case at a later time.

    The insurance exchanges

    Under Obamacare, states are required to create "exchanges" so their citizens can buy subsidized health insurance on their own.

    These exchanges have drawn the ire of quite a few states with conservative leaders, who have refused to implement the exchanges, The New Republic reported in November.

    Anticipating this reluctance, Obamacare allows the federal government to step in and set up the exchanges itself for states that refuse to do so.

    However, conservatives fighting Obamacare say the language of the law is a "little fuzzy" about whether the federal government can provide subsidies through those exchanges, TNR reported.

    Back in September, Oklahoma Attorney General Scott Pruitt filed a lawsuit fighting the Affordable Care Act, arguing the federal government would be exceeding its authority by trying to implement those subsidies, NPR reported at the time.

    Lawyers for the U.S. government asked U.S. Eastern District Judge Ronald White last month to dismiss Pruitt's lawsuit, saying the state presents only "abstract questions of political power."

    "Oklahoma's reading of the Affordable Care Act presents only a 'difference of opinion' between the state and government, not a case or controversy," the federal government's motion to dismiss stated.

    SEE ALSO: Justice Scalia's Most Cantankerous Statements Of 2012 >

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    When the Supreme Court upheld the heart of the Affordable Care Actin June, opponents scrambled to find new ways to bring down President Obama's signature health care reform.

    The Supreme Court shocked many when it ruled Congress could use its taxing powers to force most U.S. citizens to buy health insurance of their own, or pay a penalty.

    The challenges that followed included a suit claiming the bill was unconstitutional because it started in the Senate and not in the House, where the Constitution requires tax bills to start.

    States are also fighting insurance exchanges that will enable their citizens to buy subsidized insurance. Private companies, with religious owners, are waging a battle all their own against the requirement that employers' insurance cover birth control.

    But only one of these challenges stands much of a chance at succeeding, several top Supreme Court experts told Business Insider. That's the fight over the contraception mandate, which several private business owners say violates their religious beliefs.

    "The contraception requirement for private employers is in trouble as applied to religiously oriented employers," says Tom Goldstein, a high court lawyer and founder of SCOTUSblog. "That's the serious one."

    The key issue will be whether the contraception requirement violates the Religious Freedom Restoration Act, which aims to prevent laws that place too heavy a burden on people's ability to express their religion.

    "The legal question is difficult because the RFRA is very protective of religious liberty," Duke law professor Neil Siegel told BI in an email message.

    The Supreme Court is more likely to hear the contraception case than the other challenges because it "always seems willing to save a spot or two on the docket for a religion clause case," Supreme Court veteran Carter Phillips says.

    If the high court takes the case, its more conservative justices could find a lot to dislike about the contraception mandate, UCLA constitutional law professor Adam Winkler says.

    Just last year, the high court came down on the side of religious freedom, finding the government had to stay out of hiring and firing decisions of religious organizations.

    "The other challenges are shots in the dark," Winkler said. 

    SEE ALSO: These 5 Supreme Court Cases Could Change Americans Lives This Year >

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    fox news frontpage obamacare

    The Supreme Court's decision in June to save the heart of Obamacare prompted opponents to regroup and try to find new ways to attack the president's signature health reform.

    In his majority opinion, Chief Justice John Roberts ruled that Congress could use its taxing authority to force most citizens to buy health insurance or else pay a penalty.

    Now that the controversial "individual mandate" has been upheld, opponents are continuing to fight other parts of the law.

    Some companies have filed suits claiming a requirement that employers' health insurance cover birth control violates their religious beliefs. That fight has at least a shot of succeeding before a Supreme Court that's fiercely protective of religious liberty.

    But every other challenge to the law is likely to fail miserably, several top Supreme Court lawyers told BI.

    One of those challenges claims the law is unconstitutional because tax bills must start in the House of Representatives while Obamacare started in the Senate.

    The other challenge, meanwhile, involves the insurance exchanges that must be set up in each state under the law. These exchanges allow a state's citizens to shop for their own insurance and easily compare health plans.

    If states refuse to set up exchanges, then the law authorizes the federal government to step in and do so. Conservative states claim the U.S. doesn't have the authority to run the virtual insurance marketplaces.

    The opponents' arguments in both of these cases are just weak, experts said.

    "Never in history has the court struck down a law because it was a tax that did not originate in the House. What was done here (using a House bill number) is frequently done," says Erwin Chemerinsky, dean of the University of California, Irvine School of Law. "Nor is the court likely to say that state sovereignty prevents the federal government from acting as it wants to set up exchanges."

    UCLA constitutional law professor Adam Winkler acknowledged that the Supreme Court could surprise everybody and strike down parts of Obamacare. But he predicted that health reform would withstand every challenge, while acknowledging the contraception fight has some merit.

    "The other challenges are shots in the dark brought as part of a seemingly desperate effort by opponents of Obamacare to do something – anything – to stop the law from going into effect," Winkler said.

    SEE ALSO: These 5 Supreme Court Cases Could Change Americans' Lives This Year >

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    obama change back

    As US President Barack Obama begins his second term, he needs a simple way to express his vision and policies for the economy – a metaphor around which support for his policies might crystallize, thereby boosting his administration’s political effectiveness.

    So, what makes a successful metaphor work?

    The 2008 Obama campaign used the slogan “Change we can believe in.”

    But “change” is not a metaphor for a new government: it does not stand for any policies.

    Nor does “Hope” or “Yes we can!”

    The 2012 Obama campaign used the one-word slogan “Forward!”

    Once again, it signifies nothing about policies or their underlying philosophy. Every politician, whether liberal or conservative, wants to move forward, not backward.

    Continue reading at Project Syndicate >

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    justice clarence thomas

    Clarence Thomas shocked many U.S. Supreme Court observers today when he uttered his first phrase during oral arguments in nearly seven years.

    Still, Thomas wasn't actually asking a question.

    The transcript doesn't capture his entire sentence, but reports have indicated he spoke up to mock his alma materYale Law School.

    There may be a reason why Thomas is loath to ask questions.

    The Supreme Court's most silent justice spoke at an event in Charlotte, N.C. over the summer, revealing that he would do away with oral arguments if he could change anything about the Supreme Court process, the Charlotte Observer reported.

    Thomas spoke at the unveiling of a portrait of David Sentelle, who's a chief judge on the U.S. Court of Appeals for the District of Columbia and an ex-Charlotte resident.

    “In Judge Sentelle I discerned a fellow displaced Southerner,” said Thomas, a Georgia native, according to the Observer.

    Thomas has defended his years-long stint of silence, pointing to his Southern background as a possible explanation, according to an April report by the Associated Press.

    "I don't see where that advances anything," Thomas said at a speech in April, referring to asking questions. "Maybe it's the Southerner in me. Maybe it's the introvert in me, I don't know. I think that when somebody's talking, somebody ought to listen."

    DON'T MISS: Justice Scalia Made A Smart Argument For Kids' Right To Play Violent Video Games >

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    healthcare reformPresident Barack Obama's health care overhaul law has spawned its own jargon. With the law finally about to take full effect, consumers might want to get familiar with some of the terms:

    Affordable Care Act — The most common formal name for the health care law. Its full title is the Patient Protection and Affordable Care Act, or PPACA, pronounced (Pea-PUH-kah). Opponents still deride the law as "Obamacare," but Obama has embraced that term, saying it shows he cares.

    Employer mandate — A federal requirement that companies with 50 or more workers pay a penalty to the government if one of their workers obtains taxpayer subsidized coverage through the law. Effective Jan. 1, 2014. Intended to keep companies from "dumping" employees into public coverage.

    Individual mandate — A federal requirement that virtually everyone in the United State has health insurance, either through an employer, a government program or by buying his own plan. Effective Jan. 1, 2014. Exemptions for financial hardship and religious objections. Does not apply to illegal immigrants. People who ignore the mandate will face fines from Internal Revenue Service.

    Essential health benefits — Basic health benefits that most health insurance plans will have to cover starting in 2014. They include office visits, emergency services, hospitalization, rehab care, mental health and substance abuse treatment, prescriptions, lab tests, prevention, maternal and newborn care, and pediatric care.

    Exchanges — Online health insurance marketplaces in each state where consumers can get private health insurance, subsidized by the government. Open enrollment starts Oct. 1, and the coverage takes effect Jan. 1, 2014. Exchanges can be run by the states, the federal government, or a state-federal partnership. Small businesses will have access to their own exchanges.

    Medicaid expansion — The health care law also expands the federal-state safety-net program to cover more low-income people. Medicaid is expected to account for close to half of the 30 million uninsured people who, the Congressional Budget Office estimates, eventually will gain coverage through the law. The federal government will pay the full cost of the new coverage from 2014-2016, then phase down to 90 percent. States are free to reject the expansion. In those states, many adults below the poverty level would remain uninsured.

    Metal levels —The four levels of coverage available through exchange plans, called bronze, silver, gold, and platinum. Bronze plans feature the lowest monthly premiums, but cover only 60 percent of average costs. Platinum plans cover 90 percent of expected costs.

    Pre-existing condition — An ongoing or past health problem. Currently insurers can use pre-existing conditions to deny or restrict coverage, or charge more. Those practices will be barred by federal law starting Jan. 1, 2014, and insurers will have to accept all applicants.

    Tax credits — Government health insurance subsidies for individuals will come in the form of tax credits. The money will be paid directly to the consumer's health plan. The subsidies are based on income. Each year, people will have to "true up" with the IRS to make sure they got the right amount. People who receive too generous a tax credit may owe money back to the government.

    Tax penalty — The fine levied on individuals who disregard the individual insurance mandate. It starts small and gets bigger in subsequent years. In 2014 it's $95 or 1 percent of taxable income. By 2016, it's $695 or 2.5 percent of taxable income, whichever is greater. Thereafter it's adjusted for inflation.

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    obama fiscal cliff

    In a reversal of policy, the Obama administration plans to allow religious institutions the ability to opt out of providing employees insurance coverage for contraceptives. 

    CNN first reported, citing two sources in the administration, that the Obama administration will now allow religious institutions to opt out of coverage on moral grounds. White House press secretary Jay Carney confirmed the changes on Friday but said they did not mean that the administration's initial rules were an overreach.

    The new policy will still require most employers to cover contraception in their employees' healthcare plans. But the new rules would exempt institutions that fit a definition of a "religious institution." 

    Here are HHS' four criteria for meeting that definition:

    1. opposes providing coverage for some or all of any contraceptive services required to be covered under Section 2713 of the PHS Act, on account of religious objections;
    2. is organized and operates as a nonprofit entity;
    3. holds itself out as a religious organization; and
    4. self-certifies that it meets these criteria and specifies the contraceptive services for which it objects to providing coverage.

    Employees at religious institutions could still receive contraceptive coverage through separate individual health insurance policies, without cost sharing or additional premiums.

    The change comes about a year after the administration incurred a firestorm over the policy that mandated religious groups to cover contraceptives in their insurance plans as part of the Affordable Care Act. The Catholic Church took particular public exception to the rule, saying it violated their religious beliefs. In May, 43 Catholic organizations challenged the rules in federal court.

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    obamacare supporters supreme court

    Yesterday, we noted that the Congressional Budget Office was forecasting that many short-term drivers of the deficit were being taken care of through upcoming cuts and revenue increases. 

    But, the CBO also reported that one of the most important long term drivers of the debt is becoming less of a problem.

    This is incredible news for both deficit hawks and people who don't want to further reduced the size of government. 

    The acceleration of the growth rate of the cost of healthcare was and remains one of the primary drivers of the future national debt. 

    One of the entire points of the health care fight was to get a bill that just slows down that growth so that GDP could catch up. The hope is to decrease the severity of the parabolic increase in health care costs. 

    So it's excellent news that the nonpartisan, apolitical Congressional Budget Office reported they expect the deceleration of health care cost growth to have an impressive impact on the budget down the road. 

    Medicaid and Medicare. In recent years, health care spending has grown much more slowly both nationally and for federal programs than historical rates would have indicated. (For example, in 2012, federal spending for Medicare and Medicaid was about 5 percent below the amount that CBO had projected in March 2010.) [...] From the March 2010 baseline to the current baseline, such technical revisions have lowered estimates of federal spending for the two programs in 2020 by about $200 billion—by $126 billion for Medicare and by $78 billion for Medicaid, or by roughly 15 percent for each program.

    In short: The CBO was surprised to find that soon the U.S. will see major savings on Medicare and Medicaid because health care spending growth has slowed. That will save billions of dollars down the line. 

    According to Sarah Kliff at WonkBlog:

    Squeezing $200 billion out of entitlement programs is nothing to sneeze at; that’s about double the revenue the government would generate by raising the Medicare eligibility age from 65 to 67.

    Here's the expected savings for federal health care programs as a result of the deceleration of cost growth:

    years for medical

    cost decreases medicare

    Read the full report here

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