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News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform

• New York Times editorial: Gouging Women on Health Insurance. Excerpts: As tens of thousands of workers lose their jobs — and their group health insurance — in a worsening economy, they will have to scramble to find affordable insurance policies in the open market. The problems will be particularly acute for women, who often pay far higher premiums than men for the same health coverage, if they can get coverage at all.

  The inequities in the health insurance market were described in a recent report by the National Women’s Law Center and in an article by Robert Pear in The Times. If women are covered by an employer’s group policy, they are usually protected by federal antidiscrimination laws. The states, however, regulate the market for individually bought policies, and most offer women few protections against discrimination. New York is a notable exception.

  After checking policies around the country, Mr. Pear found that women can pay hundreds of dollars a year more than men for identical coverage. The Law Center’s analysis of 3,500 individual health insurance plans found that insurers charged 40-year-old women anywhere from 4 percent to 48 percent more than they charged men of the same age.

  The study also found that in some states insurers are allowed to reject applicants for reasons that effectively exclude many women, such as having had a Caesarean section or surviving domestic violence, and that the vast majority of individual policies don’t cover maternity care.

• Associated Press, courtesy of the New York Times: Few Options Remain When Job Insurance Disappears.
• Austin American-Statesman: U.S. insurers consider sending patients overseas for cheaper treatment. By Corrie MacLaggan. Excerpts: A recent report estimates that hundreds of thousands of Americans go abroad each year for medical procedures, primarily to save money. They are not the only ones eyeing the bottom line. Some U.S. insurance companies — including Aetna and UnitedHealthcare — are considering paying for patients to go overseas for care, which could spark major growth in the medical travel industry. Wockhardt Hospitals officials said major insurers are requesting data that show how well the Indian company's hospitals treat patients, a sign that the insurers are investigating options in India. ...

  "The American health care system has pushed itself into a corner where even the most routine care is not financially accessible for the average family," said Dr. Steven Tucker, an oncologist in Singapore who is president of the International Medical Travel Association, a nonprofit group of health care providers and medical travel agents.

  Estimates on the number of medical tourists vary widely and depend on how the term is defined. A new report by the Deloitte Center for Health Solutions, a research arm of the accounting firm Deloitte LLP, says that 750,000 Americans traveled abroad for medical care in 2007. Meanwhile, Josef Woodman, author of the consumer guide "Patients Beyond Borders," puts the 2007 number closer to 180,000.

News and Opinion Concerning the U.S. Financial Crisis

"But dependency on government has never been bad for the rich. The pretense of the laissez-faire people is that only the poor are dependent on government, while the rich take care of themselves. This argument manages to ignore all of modern history, which shows a consistent record of laissez-faire for the poor, but enormous government intervention for the rich." From Economic Justice: The American Class System, from the book Declarations of Independence by Howard Zinn.

• Reuters: Banks owe billions in pay, pensions to execs: report. Excerpts: Troubled financial giants getting cash infusions from the U.S. government owed executives more than $40 billion for deferred pay and pensions as of the end of 2007, the Wall Street Journal reported in an analysis. The sums owed are mostly for special executive pensions and deferred compensation, including bonuses, for prior years, according to the paper's web site. ...

  Across the industry, bank executives and directors are discussing how they will handle the need to remain competitive in paying top people without incurring the anger of lawmakers and regulators. People familiar with the situation inside several of the top U.S. banks told Reuters most compensation decisions will not be made until next month. These people also say the firms still intend to compensate valued employees. "The government cutting or controlling pay is a non-starter. Bank heads think it's dangerous and it sets a bad precedent," one bank insider said. ...

  Goldman, Morgan Stanley and Merrill Lynch have set aside $20 billion as compensation in the first three quarters, with two-thirds typically earmarked for year-end performance bonuses. These amounts were put in reserve before August 31, ahead of Lehman's collapse and last month's Treasury intervention.

  Compensation is accrued throughout the year and usually equals 45 percent to 55 percent of revenue. For instance, nine banks paid out an estimated $50 billion in bonuses in 2007, based on the total compensation expense for the companies and assuming that, for investment banks, about 60 percent of total compensation was allocated for bonuses, while commercial banks allocated about 20 percent for that purpose.

  The total of these obligations at some firms exceed what they owe in pensions to their entire workforces, the Journal said.

• Jim Hightower: Why Are We Bailing Out Extravagant Executive Pay? Full excerpt: Well, isn’t this special? Despite Washington’s assurance to us angry commoners that its Wall Street bailout scheme would, by gollies, include a crackdown on excessive pay to top executives – there seems to be a few loopholes. The Guardian newspaper in London analyzed corporate pay plans that were recently drawn up by Citigroup, Goldman Sachs, Merrill Lynch, Morgan Stanley, JPMorgan Chase, and Lehman Brothers. The highest-ranking executives of these banks are to split a total of $70 billion in salaries and bonuses this year.

  Bonuses? The stock prices of the firms have plummeted in the past year, Lehman Brothers has collapsed completely, the bungling executives have caused a global financial crisis, and the five remaining banks are down now down in Washington loading up their share of a $700 billion taxpayer bailout. They get bonuses for that?

  The math is infuriatingly easy here: This $70 billion executive payout means that honchos in these firms will siphon off 10 percent of the bailout funds that were supposed to shore up our economy – not reward executive failure.

  Meanwhile, there’s the loudly ballyhooded effort by Congress to restrict future pay for the big shots at banks getting bailout money. Congress’s bark was ferocious, but its bite turns out to be harmless. The banks are limited to a tax deduction of only $500,000 for each executive’s pay. But there’s no limit on how much total money is doled out to the execs – meaning they can still be paid $5 million or even $50 million a year. The banks wouldn’t get a tax break on the big sum, but – hey – they’re already getting billions of our tax dollars from the bailout, and that money can be used to maintain the extravagant paydays of those at the top.

  These are not merely loopholes in the bailout scheme – they amount to blatant frauds.

• Jim Hightower: Washington's Bailout Scam. Full excerpt: It’s not a “Wall Street bailout,” complain the Bushites when they’re asked about their Wall Street bailout. It’s a "multifaceted stabilization program.” Cute semantics, but – spin control aside – it’s still Wall Street bankers who’re getting the money. Yes, yes, the Bushites say impatiently, but the whole idea of pumping taxpayer dollars into those banks is to unclog their credit channels so they begin to make loans again to businesses and consumers. It’s all about credit flow to Main Street, they tell us.

  Really? Then, why is there no requirement in the bailout plan that banks must actually make loans as a condition of getting the money? Have you heard about this? America’s nine largest banks – including Bank of America, Citigroup, Goldman Sachs, and Wells Fargo – are being handed 125 billion of our tax dollars with no strings attached. The Bushites say they “hope” the bankers will use this largess to help the American economy… but that it’s up to them. Indeed, Bush’s chief bank regulator says he will not even monitor how the recipients use our money.

  For their part, the Big Nine say they feel no urgency to move the funds into the credit system. After all, they sniff, we have lost a ton of profit in the past few months, so we'll need the bulk of the handout to beef-up our own balance sheets.

  Worse, some market analysts expect the banks to use Washington’s gift to buy up smaller competitors. Yes, that means that our tax dollars will go toward the elimination of banking competition in America! Not only will consumers and businesses be left with fewer choices, but this also will increase the size of poorly-managed megabanks that Washington and Wall Street have already designated as “too big to fail.” The Bushites are right. This is not a bailout – it’s a scam!

• Jim Hightower: What We Could Do With $700 Billion. Excerpt: And these are people who’ve been trying to tag Barack Obama as a socialist! We’re talking about at least $700 billion here, coming right out of our public treasury. Imagine if that sum was invested for public purposes – what could it achieve?
  • We could repair all of America’s deteriorating bridges, roads, and levees – projects that would create a million or more good jobs.
  • We could launch a “Green Deal” to make all of America’s homes and buildings energy efficient – all of FDR’s New Deal public works projects, for example, cost only half as much as Bush’s Wall Street bailout.
  • We could replace the Hubble telescope, put a new international space station into orbit, and launch a new Apollo-style exploration of our planetary system – all for less than the bailout’s cost.

  You might recall that we've always been told that there’s no money to do such big American projects. Really? Then where did they find that $700 billion they're now handing out to Wall Street?

• Jim Hightower: Wall Street Bailout Goes from Scam to Scandal. Full excerpt: Bailing out Wall Street billionaires is not exactly popular with voters, so Hank Paulson, George W’s treasury secretary, came up with this cover story: It’s not about Wall Street, it’s about your street. He explained that putting 250 billion of our tax dollars into the nation’s largest private banks, will unclog their credit flow – sort of like Liquid-Plumr for banks. With this government input, Paulson promised, banks would again begin to make loans to businesses and consumers, and bluebirds of economic happiness would once again twitter throughout America.

  He lied. There never was any connection between the bailout and credit flow. Indeed, the bailout czar is now doling out billions with absolutely no strings attached – no requirement whatsoever that the recipient banks start making loans to “your street.” The unclogging rationale was a scam.

  Instead, Paulson & Company are using the bailout funds to restructure banking in ways that’ll harm your street. Behind the scenes, the Treasury Department is actively encouraging big banks to use their taxpayer windfall to buy out our regional and local banks, eliminating these smaller competitors from the marketplace. The big banks, of course, are delighted. For example, JPMorgan Chase got $25 billion from us, and a top executive recently gushed about being able to use it “on the acquisition side or opportunistic side for [taking over] some banks who are still struggling."

  Thanks, Hank! By forcing this consolidation, Paulson will reduce banking choices and services for us consumers, while driving up the fees we pay. He’ll also drastically enlarge the very giants that made the mess we’re in – banks that he told us are already “too big to fail.” This bailout has gone from scam to scandal! Where is Congress? Paulson shouldn’t just be stopped – he should be impeached.

• Motley Fool: Why Do We Pay Big Money to Executives Who Failed? Excerpts: When I begged Uncle Sam to please let something fail recently, I brought up the idea that when companies require bailouts, maybe top brass should be required to jump with no golden parachute whatsoever. Why do we give top executives a cushy landing when they're let go? Doesn't that sound suspiciously like an incentive to screw up, or at least give a message that screwing up wouldn't be that bad for them?

  Take the Big Three's recent hope for government loans in the $25 billion to $50 billion range. How short are the memories of those who forget that Chrysler is headed up by Bob Nardelli, who left Home Depot in shame -- OK, maybe not that much shame, seeing as how he got a $210 million goodbye present on the way out. Somehow it seems ironic that his company is among the ones asking for government help. Perhaps some of these rich dudes could kick in some cash when their companies are floundering? Call me crazy.

  Shareholders should pressure their companies for say-on-pay policies and reasonable salaries. It's not unheard of. Costco and Whole Foods Market jump to mind as two companies that have been ahead of the curve when it comes to reasonable pay for CEOs, and some of the most brilliant minds in business and investing, like Peter Drucker and Berkshire Hathaway's Warren Buffett, have taken stands against excesses in CEO pay.

  I think golden parachutes in particular should be viewed as symbols of decadence and thievery, not to mention the antithesis of true free-market dealings. Failure should not pay. In the case of bailouts and government assistance, then both shareholders and the public at large are the ones who get their pockets picked for a whole lot of nothing. I don't see why this stuff has gotten by so easily for as long as it has -- it's low on both ethics and logic. So many of these guys have been paid millions year-in and year-out anyway, sometimes making terrible decisions that don't come out in the wash until years later (like now).

New on the Alliance@IBM Site

• Job Cuts Status & Comments page
  • Comment 11/01/08: For those asking about the severance -- I was one affected by the 10/1 announcement of layoffs within ITD. I'm told that I'll be getting 2 weeks pay for every year worked with the company. 6 months pay max. They're also letting me keep my benefits for 6 months, regardless of how many years I have. Good luck to all of you. -Rage Against The Machine-
  • Comment 11/01/08: I hear through the grapevine that Infoprint Solutions, The company the printer folks got shoved into has just announced an across the board Voluntary transition option to all Service folks and Service managers. Agree to leave by Dec 31 and get up to 6 months pay. This could be a new record. They just joined the new company June 1st and are already being shown the exit. I think the Qualexserv people lasted longer then this. -Exodus2007-
  • Comment 11/04/08: I have worked over the last 22 years at several Fortune 500 Companies. And IBM cares less about its people.... Well we are slaves. The job market sucks and I am just waiting to get my pink slip..... Good luck to all -sick of IBM
  • Comment 11/04/08: Confirmation about Resource Action in SEA&T Group in GBS (Application Services). Anyone on the bench will be let go (even though they are spinning as skills needed for current environment - total BS). -IHateWorkingHere-
  • Comment 11/04/08: STG managers with open hiring headcount supposedly can't make offers to US employees, the only possible headcount increases allowable are offshore (aka India, Brazil, or similar). Expertise is not a factor, "saving money" is all that matters. No longer needs to be "first time correct". -BTV Employee-
  • Comment 11/05/08: The SEA&T GBS resource action is not just for those on the bench. It is also for those with a current assignment scheduled to end in the first part of 2009. My assignment is scheduled until Jan 31 with a probable extension well in to the second quarter. Did not matter...my last day is Dec 1. -IHateWorkingHereToo-
  • Comment 11/06/08: IHateWorkingHereToo - Are you in Test or Systems Engineering within SEA&T? Do you know how many people got impacted by the Resource Action? Of course, getting any information from management is about as clear as mud. -IHateWorkingHere-
  • Comment 11/07/08: Engineer in Fishkill NY overhear one h1b visa 'manager'/overlord talking to h1b worker saying... 'After the resource action we can bring in a few more people' (meaning h1b's). It is quite clear that ibm intends to replace as many workers with as many h1b's and L-2 (or what evers) as they can possibly find. I hope ibm'ers are calling their local reps and letting them know about what is going on! ibm gets millions in tax breaks for 'job's which it then gives to foreign workers both in the US and offshore! sam palmaselloff has hired more communist slaves and indentured servants than any slave owner that ever lived! It's time to start calling the ins, fbi, and any other agency and government rep you can think of while there are still a few Americans left working in the US. -sam-is-a-commie-slave-lover-
• General Visitor's Comment page
• Pension Comments page
• Raise and Salary Comments
  • Comment 11/02/08: Salary = 80K; Band Level = 08Q; Job Title = Sr I/T Specialist (exempt); Years Service = 25; Hours/Week = 40; Div Name = global service; Location = NE; Message = -401KWentBad- At least you are around your band midpoint. The range for 595K family is from 68K to 138K for my geography. I reckon I will never see the midpoint. They don't even give those MBA's anymore. That was a one shot deal and another promise IBM broke to folks like me. -Anonymous-
  • Comment 11/06/08: Salary = 105000; Band Level = 9; Message = doesn't include bonus -Jimbo-
• PBC Comments
  • Comment 11/02/08: Prior Yr PBC = 2; This Yr PBC = 2; This Yr Bonus = 2400; Prior Yr Bonus = 2300; Message = Band 6, I have been evaluated as "high" 2 for my two PBCs meaning I got score 2 but they told me at was at the top of the 2 and got higher bonus for that (though never got a raise). But then in my mid-year evaluation for this year, I dropped to the "low" group, I'm at the top of the bottom third group... Big drop within 6 months. I don't feel my work deteriorate, I am constantly improving. They hired a bunch of new guys and I am taking it that the new guys are getting a higher evaluation than me. They said that I was still in the 2 group and safe for not getting a 3. I will see what I will get for my evaluation this year. If I don't have a raise in 2009 and economy gets better, I will seriously start looking for another job as I would have been working for 4 years and being at same or lower point than when I started. The PBC evaluation process demotivates me more than anything. -y-
  • Comment 11/05/08: Prior Yr PBC = 2; This Yr PBC = 2+; Message = PBC ratings are a joke. Most of the time, they have nothing to do with your contributions at all. If you are good buddies with your manager then you will get a good rating. If your manager doesn't like you, you will get a bad rating even if you outperform the rest of the team. -patriot-
• International Comments

Vault Message Board Posts

Vault's IBM Business Consulting Services message board is a popular hangout for IBM BCS employees, including many employees acquired from PwC. Some sample posts follow:

• "What are my chances?" by "Ineka". Full excerpt: What are my chances getting in as an entry level consultant in IBM? I have 1.5 yrs of experience with the government doing auditing, a bachelor's degree in accounting and good internship experience. I just applied via the IBM web site but I am wondering how effective that is. Unfortunately, I do not know any insiders who can forward my resume in but my main question is, what are my chances? Thanks!