Politics. Antioch used to be a suburb of Nashville until the rural area of little consequence was folded into the Metropolitan Government of Nashville & Davidson County in 1963. Today, it is a lot like the city at large. It has extremes of poverty and wealth, is home to the city’s largest immigrant and African American populations and is decidedly less fashionable when compared to the intown areas of west and east Nashville.
Coincident with my time in office, Antioch was represented by Duane Dominy, who ran under the slogan, “I am not the pizza man, but I will deliver.” Duane, a graphic designer by day and a balloon artist on nights and weekends, was able to slip into a single sentence at lunch last week the following: George Soros, side effects of Remdesivir and the efficacy of masks.
Duane is quickly dismissed in the fashionable quarters of the city, and he doesn’t care, claiming the life cycle of a conspiracy theory is now six months. He is liked and admired, however, among the people he vigorously represented for eight years. So true is that while Duane was recounting his daughter’s refusal to follow the vaccine mandates of a certain FAANG company, a middle-age African American woman awaiting her lunch nearby joined the discussion in support of his family’s position.
The data supports the anecdote, vaccination rates among minorities are low (and mortality high). The anecdote and the data beg a few important political questions. Health and social services have been the largest plank of Democrats’ platform to cultivate, maintain and expand loyal constituencies that include, in large part, African Americans.
Yet, that powerful constituency that was responsible for Joe Biden’s victory refuses to go along with one of the President’s signature health policy positions. It is convenient to suggest all the usual reasons – education, misinformation, Facebook – none of it matters. What matters is an important - critical actually - block of voters, already skeptical of the American health care system, has found cause to ignore all reasonable and unreasonable public health pleas.
Worse, the White House has little to show for its draconian policies. Forced closures of businesses, schools and churches and vaccine mandates have had little impact on the persistent waves of infection. So impotent are policies that even senior administration officials cannot seem to avoid infection these days.
Having taken the public and especially a key and reliable voting block past the point of no return when it comes to trust in the American health apparatus, is the entire plank of social and health care policies at risk? If valuing services and support turns into “leave me alone,” what health and social policies will drive voters to the polls?
Policy. The Office of the Actuary at Health and Human Services released its response to comments on the Medicare Advantage PY 2023 rates last week. Payments are expected to increase 8.5% to plan sponsors due largely to the Actuary’s analysis that suggests a significant increase in the intensity of services this year and next.
After that, however, services, and with them Medicare spending, are not expected to begin to return to normal levels until after 2024 due to the heavy toll COVID-19 has taken on heavy utilizers of health care. The effects of the excess mortality these last few years are expected to last through 2028.
About the time the effects of COVID-19 mortality wear off, the Medicare population and those that service them will face another headwind. The growth in the Medicare eligible population will slow significantly about 2027.
What should haunt the political class, especially at the federal level, is that the health care system as we know it today was built to serve the Medicare population. From cancer drugs and clinics to cardiac cath labs and joint replacements, health care operates at scale to treat – whether you need it or not – these conditions and others.
These conditions will persist and continue to be addressed but from whence comes the growth? If there is no growth, no pressing need to address, what becomes of health care as a political priority over which the federal government has obsessed these last 30 years?
Power. If you turned 65 this year, as Robert Kapito, President of Blackrock did in February, you have spent most of life enjoying the supremacy of your demographic. Unlike your parents, you have been able to eschew the cultural and social norms of obligation, sacrifice and honor without fear of reprisal, and bend the American economy and culture to your will.
Your demographic is so vast and so influential – helped significantly by a political cohort that cannot for one hot second fathom a world without them in it – that without any irony whatsoever you can say things like this about young Americans:
“And we have a very entitled generation that has never had to sacrifice.”
Assuming the New York Post and Bloomberg reported the statement accurately and in context, Mr. Kapito's comments are but another reflection of the utter contempt those that remain immovable from the highest rungs of American finance, academia, politics and media have for their competing cohort.
It is hard to see what purpose is served when a leading American businessman says such a foolish thing. It takes a special kind of tone deafness to ignore the economic policies of the last 25 years and the COVID-19 policies of the last two to level such an assault on your future customers.
Since Mr. Kapito does not seem like an irrational man, perhaps the answer lies in knowing young America is not going to be all that interested in Blackrock. You can throw all the ESG-speak their way and they are still likely to see the asset manager for what it is; large and powerful enough to perpetuate a system that has never served their interests.
There we arrive at the richest of ironies. This generation of Americans that have sacrificed wage growth, asset accumulation and, most recently, career advancement, in the service of their thankless elders are themselves large. Their power, when they choose to assert it, dims the prospects of the status quo, which at this point is built on sand anyway.
Emily Evans
Managing Director – Health Policy
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