Three nanoseconds after the House signed off on a bill extending the State Children’s Health Insurance Program to 4 million children from low-income families, the Big O signed it into law.

The House had voted something like 7 times since 2007 to expand the program only to be stoned by George W. Bush who believed it would lead to “government-run health care for every American.”

The House never could muster the votes to overturn his poison pen.

SCHIP, originally formed in 1997 with bipartisan support, is directed at kids in families that earn too much to qualify for Medicaid and not enough to afford private insurance.

Forty House Republicans voted for SCHIP. Two Democrats voted against it.

The Big O, still seething over l’affaire Daschle, trumpeted SCHIP as an indication how different things’ll be in his administration. Uh, once he finds people to fill the posts, that is.

California Democrat Henry Waxman chirped “while this bill is short of our ultimate goal of health reform, it is a down payment, and is an essential start.”

Meanwhile, Iowa Republican Steve King, derided SCHIP as “a foundation stone for socialized medicine,” and his buddy Tom McClintock of California added it was “slowly replacing employer health plans with government-paid health plans, with spiraling costs to taxpayers.”

The new SCHIP extends coverage to children and pregnant women who are legal immigrants, a rider that rankled a number of Republicans that had supported earlier versions.

To come up with the $32 billion required to fund the SCHIP expansion, the bill calls for Federal tobacco taxes to be jacked from 39 cents per pack to a buck. 

Remarkably, even after the SCHIP expansion is fully implemented, there’ll still be 5 million kids in the US who remain uninsured.

Chinese Premier Wen Jiabao has blamed the US for the Great Economic Crisis which among other things put 25 million Chinese out of work last year.

Wen didn’t actually cite the US during his Davos rant against “excessive expansion of financial institutions in blind pursuit of profit,” the utter lack of government oversight of financial institutions, and an “unsustainable model of development characterized by low savings and high consumption.”

But even Mo, Larry and Curley couldn’t have missed the reference.

Wen and Co. have been appalled to discover their supposedly safe holdings in the US financial sector weren’t so safe after all.

This includes more than a few bucks in Morgan Stanley, the cratered Reserve Primary Fund, Aunt Fannie and Uncle Freddie.

But when his blistering rhetoric fades, Wen knows he’s got a foot in the same potato sack we do. The 2 economies have to hop together, like it or not.

That’s because China enables our profligate spending in order to prop up its export-based economy.

China accumulates wealth by exporting just about everything to the US. It uses the money it makes to buy T-bills, which finances our trade deficit. This keeps US interest rates low, which lets US consumers buy more goods from China while preventing the Yuan from appreciating too quickly.

China now holds $2 trillion in US foreign exchange reserves according to the Wall Street Journal. Around the time Lehman tanked, it surpassed Japan as the largest foreign holder of Treasury bills.

That’s fine when it comes to US government-backed securities, but China did start pulling out of Fannie and Freddie in Q3 and Q4 2008, a move that forced the Feds to step in back in November and buy $600 billion in debt from the troubled organizations.

Someday, US taxpayers are going to feel that and it’s going to hurt.

New rules promulgated last November obligate Medicare to pay for expensive cancer drugs in hundreds of situations where the drugs are not approved by the FDA.

Medicare now covers Eli Lilly’s Gemzar for 16 different cancers for example. The FDA approves the $5,000 per month drug for four.

And Genentech’s Avastin, which can cost twice that, will now be covered by Medicare for use in cancers of the ovary, brain and kidney. The FDA has approved no such thing.

The windfall is the result of Medicare’s new plan to delegate coverage decisions to a set of reference guides.  If one guide recommends it, Medicare pays unless another guide specifically says you’ve got to be crazy.

Medicare didn’t seem to mind that scientists it retained to study the guides found they “cited very little of the available evidence,” or that they varied markedly in their recommendations according to Amy Abernethy, a Duke oncologist who headed an investigation on the matter. Abernathy’s report is due out shortly.

And guess what? The editors of the guides have financial ties to Big Pharma!

One guide is produced by the National Comprehensive Cancer Network, for example. The Network routinely retains experts on the dole from drug companies.

Then there’s the American Hospital Formulary guide, compiled by the American Society of Health-System Pharmacists.

Last year, the Society inked a deal with a “Foundation” which  accepts $50,000 application fees in return for assuring the applicant’s favorite oncology drug gets reviewed by the guide within 90 days.

No word on whether applicants get their money back if the guide rejects their proposal. (more…)