The Heritage Insider: work requirements, drug prices, Reed Larson, and financial privacy

September 24, 2016

 

 

Work requirements have worked, so why are liberals trying to repeals them now? California has a misguided idea for controlling drug prices. And so do all the states that want to ban copays. Reed Larson, R.I.P. Banks spend $7 million reporting on their customers for each money-laundering conviction.

 

No need to turn back the clock on welfare reform. The current push to repeal work requirements in welfare is based not on evidence that work requirements have failed, but on the claim that repealing them is the only way to help hardship cases. That’s wrong, explains Lawrence M. Mead: “Opposition to conditionality and work first has arisen initially, not because the evidence has changed, but because of problems in TANF implementation. The ‘detached’ mothers have become an issue in part because some states have made TANF benefits too hard to get. They do this by requiring that mothers who are eligible on an income basis look too long for jobs up front before they can even apply for benefits. Or applicants must provide too much paperwork. […] To prevent hardship, policymakers need not go back to entitlement, which would simply mean less work and higher welfare rolls. Rather, federal administrators should ensure that state welfare agencies allow application for TANF without unreasonable prerequisites.” [American Enterprise Institute]

 

Trying to legislate lower prices: Can a state save money simply by passing a law that says its health care programs won’t pay more for specific drugs than the Veterans Administration does? Some in California want to give it a try and they have put the idea to the voters in the form of Prop. 61. But, as Paul Howard writes, the possible unintended consequences of such a scheme include higher prices charged to the VA instead of lower prices to California, fewer drug choices if manufacturers refuse to sell at VA prices, higher outlays for more expensive alternatives if California cannot secure VA prices, lots of lawsuits as the state tries to discover what VA prices actually are, and less investment in California’s biotech industry. [Manhattan Institute]

 

If you think EpiPens are expensive now, just wait till they’re free. Legislators around the country are proposing laws to limit insurance copayments for drugs. As Devon Herrick explains, copays aren’t just a way to encourage economizing by drug consumers; they are a way to discipline drug makers, too: “Since drug maker Mylan acquired EpiPen in 2007, a two-pen set has increased in price from just over $100 to just over $600 in 2016. An EpiPen has an expiration date of about 1 year, which means families often have to throw them out and replace them each school year. The company dismisses charges that it is price gouging by saying it offers a $100 coupon to help cover copays so most familes pay nothing. But obviously the insurer is paying $500 per set or $1,000, with the spares. This is an example of why consumers need to be enlisted in the battle to control drug spending. Without consumers complaining about cost-sharing, there would be no stopping price hikes.” [National Center for Policy Analysis]

 

Reed Larson, R.I.P. Longtime leader in the right-to-work movement Reed Larson died last Saturday at the age of 93. In 1954, Larson took a leave of absence from his job as an engineer to lead a campaign for right-to-work legislation in Kansas. Right-to-work laws, now in effect in 26 states, make it illegal to require workers to join a union as a condition of employment. Larson succeeded in making Kansas a right-to-work state in 1958 and then he led the National Right to Work Committee for the next 45 years. The group promoted right-to-work legislation in other states—winning four such campaigns—and defended right-to-work laws from attacks by organized labor. In 1968, Larson established the National Right to Work Legal Defense Foundation to fight for worker freedom in the courts, and he led that group also until 2003. [National Right to Work Legal Defense Foundation]

 

Bank regulations come at a cost—including privacy. Current bank reporting requirements, write David Burton and Norbert Michel, are too costly and infringe too heavily on financial privacy: “Financial privacy is a key component of life in a free society, and the U.S. system of government was designed to ensure individuals a private sphere free of government involvement, surveillance, and control. The current U.S. financial regulatory framework has expanded so much that it now threatens this basic element of freedom. For instance, individuals who engage in cash transactions of more than a small amount trigger a general suspicion of criminal activity, and financial institutions of all kinds—including jewelry stores—have to report such transactions. Regulations have imposed an enormous compliance burden on these firms, and the companies have essentially been forced into a quasi-law-enforcement role. […] [T]he costs of the current U.S. [Bank Secrecy Act/anti-money laundering] regime are estimated to be between $4.8 billion and $8 billion annually, at least $7 million for each [money laundering] conviction. Nonetheless, the BSA/AML framework has expanded for the past few decades without any meaningful cost-benefit analysis of these rules.” [The Heritage Foundation]

 

 

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