Is ObamaCare's Medicare Cost Control Board Unconstitutional?

In yet another episode of let's-hope-the-bureauwonks-solve-our-fiscal-problems, Congress decided that the easiest way to control the rising cost of Medicare was to hand power over to a 15-member panel of health bureaucrats charged with containing spending on America's most expensive entitlement. The result is the Independent Payment Advisory Board, or IPAB, a cost-containment board appointed and housed under the executive which, under ObamaCare, is given the authority to make reccomendation about how to change Medicare in order to meet predetermined cost-containment targets. 

IPAB may technically be an advisory board, but those recommendations aren't really recommendations so much as legislative changes: They go into effect automatically unless Congress either proposes equally large cuts of its own or three-fifths of the Senate votes to override the cuts. 

The board's power to effectively rewrite law, as well as its home in the executive, may mean that it is unconstitutional. George Will has a handy overview of the argument against the board:  

The PPACA repeatedly refers to any IPAB proposal as a “legislative proposal” and speaks of “the legislation introduced” by the IPAB. Each proposal automatically becomes law unless Congress passes — with a three-fifths supermajority required in the Senate — a measure cutting medical spending as much as the IPAB proposal would.

...And it gets worse. Any resolution to abolish the IPAB must pass both houses of Congress. And no such resolution can be introduced before 2017 or after Feb. 1, 2017, and must be enacted by Aug. 15 of that year. And if passed, it cannot take effect until 2020. Defenders of all this audaciously call it a “fast track” process for considering termination of IPAB. It is, however, transparently designed to permanently entrench IPAB — never mind the principle that one Congress cannot by statute bind another Congress from altering that statute.

That principle may cause courts to dismiss the challenge by the Phoenix-based Goldwater Institute to Congress’s delegation of its powers, because courts may say that Congress can just change its mind. Hence the court may spurn the institute’s argument on behalf of two Arizona congressmen, Jeff Flake and Trent Franks, that the entrenchment of the IPAB seriously burdens the legislators’ First Amendment rights.

Diane Cohen, the institute’s senior attorney, demonstrates that the IPAB is doubly anti-constitutional. It derogates the powers of Congress. And it ignores the principle of separation of powers: It is an executive agency, its members appointed by the president, exercising legislative powers over which neither Congress nor the judiciary can exercise proper control.

The Supreme Court hasn't been terribly strict about delegation of powers cases in recent years. But this case may be different. Last month, Mark Hemingway talked to Goldwater's Diane Cohen about their case:

“The bottom line is what this board is going to be doing is not making recommendations to Congress. They’re really going to be passing law. The statute actually calls it ‘law’ throughout the Patient Protection and Affordable Care Act,” says Diane Cohen, the Goldwater Institute’s lead attorney. “Congress doesn’t have to pass them, the president doesn’t have to sign them. So it’s taking over a historically congressional responsibility and duty—and here comes the legal mumbo-jumbo—without any ‘intelligible principles’ to guide this board.”

Unlike other federal agencies with regulatory powers, IPAB is subject to no external review process—no public notification in advance of proposed rules, no opportunity for public comment, no administrative guidelines, and no judicial review. Cohen sees Congress as “just abdicating” its responsibility “because they can’t withstand political pressure.”  

What’s being proposed in IPAB is so basic a violation of the traditional separation of powers, Cohen says, that we are in virtually uncharted legal territory. To the extent that legislative powers can be exercised outside of Congress, such authority is granted through the “delegation of powers”—a well-defined legal principle. “People will say, ‘We haven’t had a case striking down delegation for years’—but this is really above and beyond what we have seen,” observes Cohen.

Regardless of the health care overhaul's attempts to entrench IPAB into the system, Congress may simply change its mind about the board anyway. In the House, at least, even Democrats aren't particularly happy with giving up their power over Medicare, and there are already efforts underway to get rid of the board. And it's still early on in this fight: IPAB hasn't been formed yet, much less made any recommendations. Expect oppoition to increase if and when the board actually gets around to announcing its package of Medicare cuts. 

But neither the constitutional challenges nor the political instability of the board seem to worry Obama. In fact, he's doubling down on his commitment to IPAB. In an April speech on the debt, he proposed to rely on the board to do even more of the debt and deficit reduction heavy lifting that he and his colleagues in Congress have so far been unwilling to do themselves. 

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  • ||

    IPAB

    Apple is everywhere nowadays.

  • Sudden||

    And because the apple fanboys are so infantile and easily wowed by anything with a lowercase i in front of it, Obama has seized his opportunity to pass what would otherwise be considered unsavory to the voting public by naming it iPAB in a stroke of political genius.

    The rotted apple brain is so easily duped that I'm convinced they would buy GENOCiDE just due to that lowercase i.

  • some guy||

    iPAB is awful.

    iPABST is something I could really get behind, though.

  • Anonymous Coward||

    Expect oppoition to increase if and when the board actually gets around to announcing its package of Medicare cuts.

    Suderman, it's time to flog the interns again. They're getting lazy.

  • non||

    I suspect that the administration wants it to be struck down. Then they can say they had a plan to contain costs, but the courts prevented it. Why else would they actually call it making law?

  • Wind Rider||

    Because it's a concept that they really don't understand, but are willing to throw things out to see if they pass for what everyone seems to be talking about, but they never do really grok.

  • some guy||

    Yeah. SCOTUS has been so weak when it comes to limiting executive power lately, that they figured they might as well see how far they can push things.

  • Wind Rider||

    As absolutely Constitutional as Dick Nixon's wage and price freezes. . .

  • Untermensch||

    It would be a great irony if the Board were to exist and then, by some fluke that could only prove divine intervention, Dr. Paul were elected president and filled IPAB with appointees that would use it to gut Medicare.

  • CoyoteBlue||

    Star Chamber + Death Panel = DEATH STAR!

  • ||

    "Now witness the firepower of this fully-armed and operational PANEL CHAMBER!"

  • sarcasmic||

    penis + potato + ocean liner = dictatorship

  • Sudden||

    Penis + House Gym Mirror + Cell Phone + Twitter Account = Circus to distract the citizenry from $1.5 trillion annual budget deficits.

  • ||

    [ASIA-PACIFIC COLD WAR II UPDATE!]

    Now, We have received reports from Our sources today of increased tension in the [SCS] South-China Sea, the [SCS] clearly belongs in the [PDRC] People's Democratic Republic of China Sphere of Influence, but recently the [SRV] Socialist Republic of Vietnam has been contesting their claims, aggressively disturbing the peace of the Greater Asian Chinese Sphere of Influence, who is behnid this?

    [WE SMELL A RAT]

    Of course, we know who is behind these Provocations, the hand of the Israeli-American Military Industrial Complex [EMPIRE] is pulling the Puppet Strings of the [SRV], trying to drag them into the Quantitative Easing Wars of Economic Stimulus, to distract attention from the decay in the [EMPIRE], the $$USD$$ [EMPIRE] Dollar is falling at the RMB [PDRC] Dollar rising, it cannot BE STOPPED thus the Grey Emminence behind the Throme of the Media Messiah Imperial President [HILLARY DIANE RODHAM CLINTON] has taken control of the Vietnamese Government and is using them for HER purposes!

    Down with the [EMPIRE] and their Socialist Vietnamese Puppets!

    HERCULE TRIATHLON SAVINIEN

  • Brett L||

    Needs more McCain. Can't have a Vietnam conspiracy without McCain.

  • Almanian||

    Needs more of [][][][][] these.

    And more words. This looks like Spoof Herc - Real Herc is usually good for a diatribe three times this long.

  • ||

    but these are Top. Men.

  • ||

    and credentialed!

  • MNG||

    I imagine Lord H is not credentialed and, where men are concerned, likely serves the bottom position.

  • Shorter MNG||

    "I am ashamed of my small penis."

  • ||

    actually I am credentialed - but I could easily do my job w/o 'em.

  • ||

    it's called brains and initiative - something sorely lacking in your responses and judgment.

  • MNG||

    Interesting no denial of the latter suspicion...

  • ||

    interesting, MNG is petty and vindictive. Surprise.

  • Roderick Glossop||

    gay-baiting? How Droll.

  • Official TEAM BLUE Spokeshole||

    MNG is allowed to make derogatory gay slurs. Since he is a card-carrying TEAM BLUE man, his tolerance and openmindedness is assumed. He is, ipso facot, a defender of all great LGBT causes. carry on.

  • MNG||

    Shorter conservative: I hate it when liberals don't live up to my fevered caricatures of them! Play by rules, waah!

  • sarcasmic||

    Funny how leftists are so poisoned by class envy, yet they practically worship those very same people. You know, the ones whose only "credential" is a mummy and daddy who used their wealth and connections to put junior through a really expensive school. Now junior has "credentials", and the less privileged people with talent and ability are ignored.

  • MNG||

    You know, I made the flip side of this much earlier today-cons and liberatarians often say we can judge someone is talented and valuable because they are wealthy, but if you suggest a correlation between talent and acheivement in any other area the two minute hate begins.

    As for envy, it's not my side railing about evil elites every five seconds...

  • sarcasmic||

    Being the child of someone who amassed wealth does not make them talented and valuable. It makes them the child of someone who is talented and valuable.

  • Almanian||

    it's not my side railing about evil elites every five seconds

    Um, yeah it is. Cause WHATEVER "side you're on" rails about TEH ELEETS!

  • MNG||

    I don't. I'm not obsesssed with, say, business, military or religious elites. More power to em says I.

  • T||

    More power to military elites!? Your closet fascism is revealed!

  • Sudden||

    I don't buy that libertarians (can't speak for conservatives) judge someone's talent and ability solely on financial statements. Far from it. Most of us libertarians regard the uber-wealthy as perpetrators of rent-seeking behaviors. Beyond that, even those that have earned their high incomes through initiative and ability aren't always the brightest. Just because some guy made a killing selling some revolutionary toilet seat doesn't mean I consider him a Mensa candidate. Good on him for making a buck, but its not really my ideal lifestyle choice.

    Moreover, I think us libertarians might be a little more ascetic than is generally assumed. In fact, our willingness to let people keep their own money is proof that we don't need to steal their money for our comfort. Although we generally make decent incomes ourselves and manage to live comfortably, I think most hardcore libertarians are happy with a decent middle to upper-middle class income, and the sufficient leisure time to read obscure books, watch the complete anthology of MST3K, and comment on H&R.

  • MNG-ish||

    I hate it when libertarians don't live up to my fevered caricatures of them! Play by rules, waah!

  • Anonymous Coward||

    I made the flip side of this much earlier today-cons and liberatarians often say we can judge someone is talented and valuable because they are wealthy

    Straw libertarian is straw.

  • ||

    Any resolution to abolish the IPAB must pass both houses of Congress. And no such resolution can be introduced before 2017 or after Feb. 1, 2017, and must be enacted by Aug. 15 of that year. And if passed, it cannot take effect until 2020.

    Utterly unenforceable. If Congress passes a bill abolishing IPAB that doesn't meet those time frames, and it is signed by the President, IPAB is gone.

    A court decision stating that this part of the bill is without force and effect would be useful, to prevent it from being used as a pretext to defend IPAB.

    Each proposal automatically becomes law unless Congress passes — with a three-fifths supermajority required in the Senate — a measure cutting medical spending as much as the IPAB proposal would.

    Also unenforcable, for the same reason.

  • ||

    when Obamacare first passed, I thought to myself "what happened if someone passed a law and no one cared." At what point does regulation (or in this case, over-regulation) break down and become ignored?

  • US Constitution||

    I've often wondered this myself...

  • MNG||

    Apart from the immorality of Obamacare's mandate, one has to wonder if anyone could imagine a more byzantine, unsellable way to achieve universal coverage. It's almost like mad scientists were kept in months long isolation until they developed the most insane bill that could be developed.

    There were about a hundred simpler ways to do what Obama wanted, but instead he did it in likely the dumbest way possible.

  • X||

    It's because democrats are too chickenshit to raise taxes in a straightforward manner. Such as waiting for the Bush tax cuts to expire so they wouldn't have to get their hands dirty. Instead Obama got all the consequences of a looming tax increase on the economy, but not the increased revenue. And then he did it again. The way he does it, he doesn't even get the stimulating effects of lower taxes, because he's always got to have a tax hike looming. He certainly is smart in a special way.

  • ||

    They aren't after universal coverage. They are trying to destroy private insurance in the guise of universal coverage, to pave the way for single-payer.

  • MNG||

    I would think people that were out to do that would have pushed a bit harder for a public option, among other things.

  • ||

    No need. The essential element is the destruction of private insurance. The public option doesn't need to be wired in advance for that to lead to single-payer.

  • Almanian||

    Then you're naive. Why use the direct route, when everyone saw what happened with HillaryCare®?

    The indirect route (Obamacare) is just as fatal to the current healthcare "system", without all the bloodshed of a direct attack.

    Yeah there's other bloodshed. Collateral damage, broken eggs and omelets, etc. etc. etc. But no blood on MY hands - "We TRIED to save the patient, but in the end, it was such a fucked up system, it died of its own weight. So now we'll come to the rescue with Single Payer! Yaaaaay!"

  • ||

    ""They go into effect automatically unless Congress either proposes equally large cuts of its own or three-fifths of the Senate votes to override the cuts. ""

    No problem getting the votes need to override the cuts. Medicare's cost control has been overridded every time to date.

    ""They are trying to destroy private insurance in the guise of universal coverage, to pave the way for single-payer.""

    If that happens, insurance companies can blame themselves. They are not figthing like their survival depends on it.

  • Anonymous Coward||

    There were about a hundred simpler ways to do what Obama wanted, but instead he did it in likely the dumbest way possible.

    Come on, give the guy a break. He's a lowly Constitutional scholar (who never published anything scholarly) who was editor of the Harvard Law Review (where he never published anything) and campaigned on a platform of absolutely nothing.

    He had to put his creativity to use somewhere.

  • ||

    Why is this not discussing Weiner?

  • Anonymous Coward||

    Would you like to see some pictures?

  • ||

    Authority without responsibility; who doesn't like that?

  • sarcasmic||

    Regulation with the power of law is also great for the Congress critters.
    It means they can say "I didn't do it."

  • ||

    Maybe the panel will drastically cut Meidcare, or go so far as to zero it out?

    OK, I laughed too.

  • ||

    to pave the way for single-payer.

    Maybe it's a distiction without a difference but I see the Holy Grail of "free, unlimited healthcare" as single provider.

  • Almanian||

    Hey, only the government can "pave"....ROOOOOAAAAAAADZ!!!

  • JD||

    Despite the fact that even the NHS is trying to move away from that model because it is too expensive.

  • ||

    I am 64 years old.
    I have private health care insurance from Blue Shield
    I am in excellent health and take no medications
    The cheapest plan Blue Shield health insurance plan available to me is their Spectrum 5000 plan
    Premiums for Blue Shield= $6000 per year.
    Deductible for Blue Shield= $5000 per year
    That means I have to pay $6000 in premiums and $5000 out of pocket before the plan even begins to cover a dime of my doctor visits or medical care. A total of $11,000 per year before

    In two months I will be on Medicare.

    Premiums for Medicare =$1300 per year
    Deductible=$0
    This means I will pay $0 out of pocket and have all my doctor visits and hospitalization COMPLETELY COVERED for $1300 a year

    Compare the two plans. Now tell me why I would want a private insurance company to be a middle man between me and my doctor?

    Anyone who is covered by private insurance knows that
    1. Every year your deductibles, premiums and copayments go up.... and your coverage goes down.
    2. Insurance companies have become more aggressive about finding creative ways to challenge claims and deny benefits.
    3. at least 20% of every private insurance dollar is lost to administrative costs: CEO and executive salaries, advertising, sales reps etc.

    Medicare covers 40 million Americans and is administered by 4000 employees. The "CEO" makes just $200,000 a year. Administrative costs are just 2% and the government drives such a hard bargain with doctors and hospitals that healthcare providers complain they aren't being paid enough

    Only the foolish can believe that private insurance companies are going to run Medicare more cost effectively than it is being run now. Don't be fooled. When you are in your last years of life and require expensive and frequent medical care...the private insurance companies will expect you to mortgage your house and spend down your retirement savings to pay your medical bills. You won't have a dime to leave to your kids.

  • ||

    Now tell me why I would want a private insurance company to be a middle man between me and my doctor?

    Because the rest of your nieghbors are sick of you sponging off them?

    Only the foolish can believe that private insurance companies are going to run Medicare more cost effectively than it is being run now.

    Only the foolsih believe that this level of wealth redistribution and public debt can be sustained for forever.

    You won't have a dime to leave to your kids.

    With a generation of unrepentent leeches still stamping their feet and their hands out for more, that part will happen for sure.

  • Almanian||

    JW, why do you hate your grandparents?

  • ||

    Because he's no longer in their will. Obviously.

  • ||

    Trillion dollar deficit? Who? What? Where? Gimme gimme gimme!

  • ||

    Glad to hear you are in great health. Realize that most Medicare recipients are not and that Medicare premiums do not begin to come close to covering the average actual cost for a Medicare beneficiary. The government makes up for this shortfall by charging everyone else for the difference, and providers make up for the low reimbursement rates by charging higher fees to patients with private insurance. That is why private insurance is so much higher. If you can run a business with a deficit every year you will be able to charge lower prices than those businesses which actually have to pay their way.

    Medicare can continue to run a deficit every year until the system collapses, which it will unless some changes are made.

    I find your last remark curious. Are you saying that taxpayers should cover the cost of end-of-life care so a patient can leave lots of money to their kids?

  • ||

    This is in response to naksuthin. I hate these threaded comment boards.

  • ||

    Now tell me why I would want a private insurance company to be a middle man between me and my doctor?

    First, tell me why you would want an unelected, unaccoutable board of federal bureaucrats to be the middle man between you and your doctor.

  • Almanian||

    Cause it's FREEEEEEEEEEEEEEEEEEEEEEEE!!!

    Yes? Good guess?

  • sarcasmic||

    Administrative costs are just 2%

    That statistic is very misleading because Medicare handles end of life care, which can add up to more money than all previous claims combined.

    Put it another way. If the average insurance claim is $1000 and the average Medicare claim is $10,000, Medicare can cost five times as much per claim to process and still have half the administrative costs as a percentage of money paid out.

  • ||

    ""2. Insurance companies have become more aggressive about finding creative ways to challenge claims and deny benefits."""

    Just don't call them death panels. That's only something government health care provides. ;-)

  • T||

    Shorter naksuthin channeling Grampa Simpson: "I'm old, gimme gimme gimme!"

  • JD||

    When you are in your last years of life and require expensive and frequent medical care...the private insurance companies will expect you to mortgage your house and spend down your retirement savings to pay your medical bills.

    Whereas Medicare will just let you die when it becomes untenable to pay for every high-tech test and treatment known to science so some gomer can live a few months longer in a nursing home.

  • Dick Fitzwell||

    I'm 35 years old and also in great health. I resent the fact that I have to pay into a program (in other words--make up the difference of the premiums that you pay) that I won't even be eligible to "take advantage of" for 30 years.

    Kindly go piss up a rope.

  • adam||

    "Premiums for Medicare =$1300 per year
    Deductible=$0
    This means I will pay $0 out of pocket and have all my doctor visits and hospitalization COMPLETELY COVERED for $1300 a year"

    Wrong. You're fundamentally wrong about what Medicare costs you (which is a separate issue from what it costs everyone else, which you apparently don't give a sh*t about).

    Medicare will cost you:
    Part A (hospilization)-
    Premium: none (for most people)
    Deductible: $1132 per year for stays less than 60 days and extra for those longer
    Part B (out-patient, physician)
    Premium: $110.50 per month, $1326 annually
    Deductible: $162 per year
    Co-insurance: 20% of all allowable charges over the deductible

    You can get medigap insurance that will pay for the deductibles and co-charges that will run you around $300 a month or more depending on health.

    Part D:
    Premium- varies depending on plan, but usually in the $30 per month range
    Copay- varies depending on plan and prescription tier, but usually for 30 day supply $4 for generics, $30 for low cost, $80 for mid cost and $100+ for high cost, with no coverage in the donut hole at about $2800, and then 95% coverage when you get out of the donut hole at about $4550.

  • adam||

    "Medicare covers 40 million Americans and is administered by 4000 employees."

    CMS may only have 4000 employees (although I doubt that's accurate), but you neglect to mention that many of the activities private insurance companies have pay for as part of administrative expenses are carried out for medicare by other federal agencies. For example, SSA and IRS collect their premiums. DOJ, FBI do some of their fraud prevention. HHS does much of their top level administration. Those costs don't get included in your 2% number.

    And of course, you also neglect to mention that Medicare uses huge number of contractors to actually perform the administration (manning call centers, processing claims, etc.) These contractors are called Medicare Administrative Contractors, they are mostly subsidiaries of large insurance companies like Blue Cross, Aetna, etc. (you know, the ones you hate). And they have contracts worth billions of dollars that don't get included in that bullsh*t 2% administrative cost number you idiots throw around.

  • ||

    Now tell me why I would want a private insurance company to be a middle man between me and my doctor?

    You don't, but I do; where do you think Medicare comes up with the difference?

  • ||

    Oops, I forgot.....

    PROFTIZES IS EEEEEVULLLLL

  • BoscoH||

    I think I understand the picture: 2 d-bags, 1 iPad.

  • shorter "libertarians"||

    Me ME Me me me me ME me me meeee! It's about meeeee! It's mine! Me! Give to to ME! I want MINE! MINE! FUCK YOU!

  • libertarian||

    And your point is ...?

  • Almanian||

    I think you meant "shorter Sponge People"

  • shorter "progressive liberals"||

    Me ME Me me me me ME me me meeee! It's about meeeee! It's mine! Me! Give to to ME! I want YOURS! YOURS! FUCK YOU!

  • Anonymous Coward||

    Me ME Me me me me ME me me meeee! It's about meeeee! It's mine! Me! Give to to ME! I want MINE! MINE! FUCK YOU!

    Im ein ani li, mi li? U'kh'she'ani le'atzmi, mah ani? V'im lo 'akhshav, eimatai?

    -Hillel

  • Dick Fitzwell||

    Me ME Me me me me ME me me meeee! It's about meeeee! It's mine! Me! Give to to ME! I want MINE! MINE! FUCK YOU!

    Even shorter, more accurate libertarians: You leave my shit alone and I'll leave your shit alone.

  • ||

    You won't have a dime to leave to your kids.

    Fuck off, slaver.

  • robc||

    I really should have put that in song form so that ASCAP would collect for me.

  • robc||

    There are surpisingly few threads in which that isnt an appropriate response.

  • Eric Holder||

    Is ObamaCare's Medicare Cost Control Board Unconstitutional?

    No.

  • ||

    I don't think it's the altitude-challenged "libertarians" yelling, "GIMME GIMME GIMME" in this argument.

  • sarcasmic||

    Libertarians seek to use government to protect their property.

    Progressives seek to use government to obtain their property.

    It is completely natural for progressives to hate libertarians, for if libertarians had their way progressives would no longer be able to use government to thieve for them.

  • Paul||

    Congress decided that the easiest way to control the rising cost of Medicare was to hand power over to a 15-member panel of health bureaucrats charged with containing spending on America's most expensive entitlement.

    Death Pane...

    Too soon?

  • ||

    Too late.

  • Anonymous Coward||

    Unelected, unimpeachable bureaucrats make everything better.

    Just look at what they did with...with...uh...give me a minute, I know I can come up with something.

  • sarcasmic||

    Roadz!
    Without unelected, unimpeachable bureaucrats there would be no Roadz!

  • braindead||

    Scoolz!

  • ||

    Administrative costs are just 2%

    Yes, it helps to hold those costs down when you don't have to pay for any of the expenses of actually getting revenue in the door.

  • Robert Finney||

    Ration Health Greed, Not MRIs
    MRIs do not need to be rationed. Eradication of fraud, waste, abuse, and mismanagement by politicians, health plans, medical groups, and special interests would fund medically necessary health care for all Americans. Special interests have hijacked Medicare by rationing healthcare of the taxpayers who fund it.
    President Obama believes that the privileged have more health care rights than plain folks Americans. He used Kaiser Permanente as the model for health reform, because the HMO has scammed non-privileged patients for 60+ years. Politicians, bureaucrats, and Dr. Strangelove physicians are “bending the cost curve,” but breaking the patients and destroying the doctor- patient relationship.
    Kaiser Permanente’s Managing Director of Investments supervises the HMO’s $40 billion non-profit slush fund, all income from which is non-taxable. CEO George Halvorson’s annual compensation is $6.7 million. All Permanente Medical Groups are for-profit.
    Kaiser Permanente rents its patients to researchers to secretly test drugs and medical devices, in which for-profit, Kaiser Ventures, invests.
    Original investigations are posted on YouTube and HMO Hardball.
    http://www.youtube.com/watch?v=v0h7tUymj2Y www.hmohardball.com
    Robert Finney PhD

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