quinnscommentary

So you think you will keep your employer-based health benefits; forces at work say you won’t

rdquinn — Tue, 22 May 2012 09:06:45 +0000

The employer contribution is what?

Many Americans pride themselves on being independent. self-sufficient, able to do things for themselves, make their own choices. They may get to put that decision-making ability to the test in the years ahead and passing that test will be very important … and costly. Obamacare provides many incentives for employers of all sizes to drop health care benefits, but that is not the point of this post.

The High Deductible Health Plan (HDHP) is the first step toward a defined contribution approach whereby the employers liability is limited in favor of more financial risk for the employee. But even that is not the issue today.

As you may know, come 2014 Obamacare establishes state health insurance exchanges. These exchanges will offer several health insurance plans that will be chosen by individuals for their coverage. Large employers are not eligible for the exchanges . . . and now we come to the point. At least one large U.S. consulting firm is on the road to offer private exchanges for large employers. Here is the essence of the idea, the employer drops all its health benefits and instead offers enrollment in a private health insurance exchange. The employer contributes a set amount and the employee chooses the health insurance he wants and pays any difference in premium. Let me repeat that, the employer contributes a set amount and the employee chooses the health insurance he wants and pays any difference in premium. In effect the employer is out of the process and the employee is on his own to select coverage and deal with the insurer and the exchange thereafter.

As the article points out, proponents of exchanges provide an analogy with the demise of defined benefit pensions in favor of defined contribution 401(k) plans. This is quite valid as both take the financial burden and obligation from the employer and shift most of it to the employee with no guarantees for the future. How appealing does that sound?

The unsaid but obvious point of all this is the advantage for the employer. The employer gets to set the contribution amount with little regard for premium increases and the employee gets to pay the balance of each year’s increase. That’s why employers may like the idea, the primary purpose is to save the employer money. Some experts will tell you that will make employees better consumers. It may also make them poorer (that is unless employers share their savings in the form of higher wages..he said with a smirk). As long as we are into analogies, how well are employees doing with retirement savings in the 401(k) as opposed to being a participant in a traditional pension plan?

According to our informal poll [see poll in right margin] many people say they welcome the idea of taking employer money and selecting their own insurance. Let’s hope they still like the idea after the first year.

One thing is undeniable, the relationship between employer and worker is changing and in the process the worker’s re$pon$ibility in increa$ing.

The following is from an article in th May issue of Employee Benefit News and is part of an interview with the CEO of Aon Hewitt, one of the largest Hr and employee benefits consulting firms.

Can you give a little bit of background on your health care exchange and how it’s going?

Savacool: Let me draw a parallel for you to the retirement pension market. If you compare 1980 to 2005 and you look at retirement plan participants – I’m going to contrast this to health in a minute – 61% of participants were in active retirement and DB plans and 39% were in other DC plans, such as thrift saving plans and profit-sharing plans. And none were in 401(k) plans. Today, 62% are in 401(k) plans, 11% in other DC and only 28% in DB plans. So, we’re essentially moving from a group-based or a company-sponsored plan to a more individual level of responsibility.

When you look at that trend and you look at health care, there’s a parallel track happening. This is really parallel to the DB-to-DC transition.

I draw the parallel to health care. If you look at 1988, 73% of enrollments were in conventional plans, about 16% in HMOs and only 11% in PPOs. Today (2011), only 1% are in conventional plans, 17% in HMO, 55% in PPOs and 17% in quasi-defined-contribution kinds of plans.

So, when you think about where exchanges fit in this, and you look at the transition to an individual level of responsibility and moving from a self-insured to an insured marketplace, you get a trend toward the utilization of exchanges, both for retirees and for active employees.

We entered the business in the retiree exchange business and have had great success. In fact, the demand this year, the rate of growth and the utilization of exchanges to both advise and then place the health insurance is growing pretty significantly. When we look at our large corporate employers – we have about 562 that we surveyed recently – what we found is that 94% of those employers are committed to offering and financially supporting health benefit coverage for their workforce in some form.

To the question I often get asked, “Are employers bailing out?” – the answer is no. They’re going to change the solution set that provides for health care coverage, but they are unlikely to exit. We are executing right now on our strategy related to our retiree health care exchange, and we’re in the process of building a corporate exchange for those who can’t access the state exchanges because they’re too big, they have more than 1,000 employees.

The interest from employers is high. We think it’s in their best interest, and we’re working with the insurance markets to define that.

Are you thinking about competing with state exchanges in the future?

Savacool: It doesn’t compete with the state exchanges. It really is complementary. In fact, we spent time at the White House meeting with members of President Obama’s staff on health care reform and the exchanges for state governments and U.S. companies; I think I’ve been there three times in the last six months to talk with them about that. Because they really are complementary, and as the exchange network, if you will, develops, everyone from very large, jumbo-level employers to small businesses will be able to avail themselves of the opportunity to participate in that.

How that ultimately lands between those who choose to participate in the state exchanges on behalf of their employees, they do a contribution of sorts, and those who participate in some industry combination – that’s all developing. But the concept, the important message, is that the concept of combining the capability of accessing the insurance markets in a very efficient way, in providing advice to those in terms of the best health care options for them and placing that insurance is very much here to stay.

How are you envisioning the structure?

Savacool: You would have a set of options that might be in a metallic kind of structure – bronze, platinum, gold, etc. – that have different attributes. Think of grouping your health care plans into different selections that are grouped based on carrier, design and price point. So you, as a prospective health care insurance consumer, can make choices: Carrier A through D, you can choose a design that works for you that has different coverage options, different deductible options, and then there’s a price point associated with each of those. So you would contact the exchange, talk through your health care needs. You would get advice in the form of what the different options were, and then you would make a choice around that. Your employer would contribute a subsidy to a certain level and then you would pay the difference to the extent that there was one.

So there are a lot of moving pieces, and given the amount of advice that needs to happen with respect to exchanges, we think that we’re really well-positioned based on our expertise.
And then there is this from Information Week Health Care

Towers Watson To Acquire Extend Health

Benefits and talent management consulting firm plans to buy online health insurance exchange provider Extend Health for $435 million.

By Marianne Kolbasuk McGee

May 15, 2012 11:59am

Professional services firm Towers Watson has signed an agreement to purchase Extend Health, an online health insurance exchange for supplemental Medicare coverage, for $435 million.
The addition of Extend Health’s health insurance exchange technology infrastructure, call centers, and existing base of 75 carriers represented in its online marketplace will help Towers Watson–best known for workplace benefits and talent management consulting services–to expand its offering into helping clients provide their retirees with assistance in purchasing private health insurance, including supplemental Medicare health plans.

Related articles

NFIB Endorses Defined Contribution Option for Health Insurance (prweb.com)

Is a defined contribution health plan in your future? (quinnscommentary.com)

Retirement Woes: 401(k)s That Look Like Old-Fashioned Pensions (moneyland.time.com)

Filed under: At Work, Healthcare

Final Word: Task Force Recommends Against PSA-based Screening for Prostate Cancer

rdquinn — Mon, 21 May 2012 11:00:31 +0000

Once again challenging conventional wisdom, new evidence shows more health care is not always the best health care. Such evaluations should be welcomed because first they mean better, less risky health care and second, they help manage costs. Some cynics will see such recommendations and changes as rationing. Quite the contrary; we need more reassessment of the health care we receive and how we receive it. We have all grown up believing more health care is always desirable We often overlook the risks associated with the care and tests we receive.

Evidence Show Harms of PSA Testing Outweigh the Benefits

PHILADELPHIA, May 22, 2012 – Following a period for public comment, the United States Preventive Services Task Force (USPSTF) released its final recommendation for prostate cancer screening. The Task Force now recommends against PSA-based screening for all men, regardless of age. The final recommendations are being published early online in the May 22 issue of Annals of Internal Medicine, the flagship journal of the American College of Physicians (ACP).

The Task Force last published recommendations on prostate cancer screening in 2008. At the time, researchers concluded that there was no evidence to support PSA testing for men over the age of 75. An independent panel of experts reviewed evidence published since 2008 and concluded that the harms of PSA testing outweigh the benefits regardless of age. The Task Force considers health benefits and harms, but not costs, when developing recommendations.

The primary goal of prostate cancer screening programs is to save lives and prevent symptomatic disease. The Task Force considered two major trials of PSA testing in asymptomatic men to assess the life-saving benefits of PSA testing. The first trial, conducted in the U.S., did not demonstrate any prostate cancer mortality reduction as a result of screening. The second trial, conducted in seven European countries, found a reduction in prostate cancer deaths of about one death prevented per 1,000 men screened in a subgroup of men aged 55 to 69 years, mostly in two countries. Five of the seven countries reporting results did not find a statistically significant reduction in deaths.

Strong evidence shows that PSA screening is associated with significant harms. Nearly 90 percent of men with PSA-detected prostate cancer undergo early treatment with surgery, radiation, or androgen deprivation therapy. Evidence shows that up to five in 1,000 men will die within one month of prostate cancer surgery and between 10 and 70 men will survive, but suffer life-long adverse effects such urinary incontinence, erectile dysfunction, and bowel dysfunction.

According to William J. Catalona, M.D., Medical Director of the Urological Research Foundation and author of an accompanying editorial, the Task Force recommendation has underestimated the benefits and overestimated the harms of prostate cancer screening. He and his co-authors argue that the Task Force — whose panel does not include urologist or cancer specialists — largely bases its recommendations on flawed studies with inadequate follow up time. In addition, the Task Force recommendations focus on mortality and do not take into consideration the substantial illness related to living with advanced cancer.

Editorial co-author, Dr. Henry Lynch, Director of the Hereditary Cancer Center at Creighton University, adds that the Task Force recommendations also leave out high-risk populations and younger men. The authors express concern that the new recommendations will take Americans back to an era when prostate cancer was often discovered at advanced, incurable stages.

“The recommendations of the USPSTF carry considerable weight with Medicare and other third-party insurers,” Dr. Lynch said. “My colleagues and I strongly believe that the Task Force recommendations should not be used as justification by insurers, including Medicare, to deny diagnosis of prostate cancer to the male population at risk.”

Yet, according to Otis W. Brawley, MD, MPH, Chief Medical Officer of the American Cancer Society, and author of a second accompanying commentary, overdiagnosis makes screening seem to save lives when it truly does not. Many men are diagnosed with prostate cancer that may never have progressed within their lifetime. Yet because they were screened and treated, they think screening saved their lives.

“Many people have a blind faith in early detection of cancer and subsequent aggressive medical intervention whenever cancer is found,” wrote Dr. Brawley. “There is little appreciation of the harms that screening and medical interventions can cause.”

In October 2011, the Task Force posted its draft recommendations for public comment. At the time, the Task Force had given PSA screening a grade “D,” meaning that physicians should not offer the test because the harms outweigh the benefits. Many people who commented on the recommendations urged the Task Force to change the recommendation to a grade “C,” meaning physicians could provide the test to patients who request it. However, no new evidence was presented. The recommendation remains unchanged.

While the recommendation clearly states that physicians should not offer PSA screening, the Task Force says it leaves the ultimate power in the hands of the health care providers.

“The USPSTF recognizes that clinical, policy, and coverage decisions involve more considerations than evidence alone,” said Task Force Chair, Virginia A. Moyer, MD, MPH of Baylor College of Medicine in Houston, TX. “Clinicians and health care providers should understand the evidence but individualize decision-making to the specific patient or situation.”

About Annals of Internal Medicine
Annals of Internal Medicine is one of the five most widely cited peer-reviewed medical journals in the world, with a current impact factor of 16.2. The journal has been published for 82 years. It accepts only 7 percent of the original research studies submitted for publication.

And then there is this from the New York Times May 16 regarding new studies indicating the high levels of HDL (good cholesterol) may not be related to lower heart disease risk.

I often see patients in the clinic with low HDL levels who ask how they can raise it,” Dr. Kathiresan said. “I tell them, ‘It means you are at increased risk but I don’t know if raising it will affect your risk.’

“That often does not go over well, he added. The notion that HDL is protective is so entrenched that the new study’s conclusions may prove hard to accept, he and other researchers said.

“When people see numbers in the abnormal range they want to do something about it,” Dr. Kathiresan said. “It is very hard to get across the concept that the safest thing might be to leave people alone.”

Filed under: Healthcare Tagged: Preventive Services Task Force, prostate, PSA test

Click and vote

rdquinn — Mon, 21 May 2012 04:15:09 +0000

Have you voted in our latest poll? Just a click away to have your opinion counted.

Go to the Poll Page or just click on the poll at the right. No hanging chads here!

Filed under: Observations on life

Human nature is a scary thing-the parking conundrum

rdquinn — Sun, 20 May 2012 09:30:19 +0000

I admit it, I’m obsessed. I can’t for the life of me figure out why anyone would intentionally park his or her car next to another car or between two other cars when an easy alternative exists. What am I missing here, is it simply the herding instinct? After all, being close to another car increases the risk of a ding or scratch and certainly makes it less comfortable getting in and out of the car.

I parked my car next to the tree and was the first car in the lot. Now I’m being spooned on two sides.

I am at a loss finding any advantage. This is a conundrum alright (do you get the idea I like that word?) or maybe it’s just that Americans don’t like to walk any further than necessary no matter what.

Let’s have your ideas on why people (and maybe you) do this!

Filed under: Observations on life

I’d be glad to identify myself to vote

rdquinn — Sat, 19 May 2012 09:05:52 +0000

Guess who?

The other day I picked up my grandson at preschool. Even though I had done so several times before, I was asked to produce a photo ID. I was glad to do so. I produce that ID on many occasions; when I use a credit card (because I don’t sign the card), at a hospital along with the insurance cards, when cashing a check, when I board a plane and on and on. Why do we ask for identification? Because people cheat!

Notably when I vote I walk into the polling place, sign a book and vote. Nobody has any idea who I really am and I seriously doubt there is close scrutiny to match my signature with that of the previous year.

There is no doubt that in past years in some parts of the Country voter registration and other requirements were used to prevent minorities from exercising their right to vote, but that was then and this is now. We are in a new world of identify theft, electronic identification and scams, and terrorist threats requiring all kinds of identification indignities.

Here is the argument against voter ID:

… it’s not hard to imagine how low-income citizens, African Americans, Latino Americans, college students, and elderly voters—groups the Brennan Center has identified as the most burdened by new voter laws—might get tangled up on voter day. The Center estimates that as many as 11 percent of eligible voters lack proper identification right now. For African Americans, it’s 25 percent—that’s 5.5 million voting-age black Americans who could get turned away at the polls for being undocumented and unphotographed.

How can I even address the above without being sarcastic? The elderly, the elderly, college students? And because you are African-American or Latino you can’t obtain appropriate identification to vote? Why is it we insist on bringing everything down to the lowest common denominator? If I were in one of these groups I would be insulted. Wait, I am and I am insulted.

Rather than worrying about the modest requirement to produce identification when voting, we should be more concerned with basic qualifications required to vote. Of course there are no such requirements resulting in the morons on Jay-Walking who think the three branches of government are part of a tree having the same right to vote as anyone else. Even the Founding Fathers could not agree on who should have the right to vote limiting such privilege to men and property owners for a time.

I realize this goes against the grain of idealized liberty, but voting carries with it some responsibility. Is it unreasonable that those people who help determine our fate as a nation meet some basic requirements such as being fully literate, being able to pass the same test required for citizenship or demonstrate a fundamental understanding of something … almost anything? Even meeting such requirements won’t shield us from the uninformed and just plain wackos among us, but that is the price of a republic we must live with.

Suffrage Parade

Our high schools should have a course specifically designed for voter literacy (history, civics and economics) that each student is required to pass to gain the right to vote . . . and then when they do vote to provide identification.

Is that too much to ask?

Oh, what are the three branches of government? How many Senators are there? Which branch of government writes tax laws? What is the purpose of a tariff? Just checking.

PA Law Prohibits Voting Without Photo ID (myfoxphilly.com)
Florida investigation reveals 180,000 non-citizens may be registered to vote (fromthetrenchesworldreport.com)
5 Million Votes Could Be Lost Due to Discriminatory Requirements (lawprofessors.typepad.com)
Voter Identification Laws Should Be Upheld (thomasbrianauthor.wordpress.com)

Filed under: Politics, Pure Opinion (That's mine, by the way)

How is it looking for an increase in your Social Security benefit come January 2013?

rdquinn — Fri, 18 May 2012 09:15:10 +0000

Now, what will happen to my Medicare premium in 2013?

Well it’s too early to tell for sure, but right now we are on track for an increase of 1.7%.The actual increase will be based on the average CPI-W index for the third quarter of 2012 compared with the same quarter in 2011. The average for 2011 was 223.2337. As of April 2012 the average was 227.012. For the month of April the index increased 0.3 percent.

If, and it’s a big if, the average CPI-W for July, August and September 2012 turns out to be 227.012, the calculation for the Security COLA would be 227.012 – 223.2337 = 3.7783/223.2337 for an increase of 1.69253 or 1.7%.

Unless we experience deflation between May and October which is unlikely, the 2013 Social Security COLA will be 1.7% or higher. For the person receiving the average monthly Social Security benefit ($1230 at the beginning of 2012), that is an increase of $20.91.

Filed under: Social Security Tagged: Bureau of Labor Statistics, COLA, Consumer price index, Social Security

Postal Service troubles and the liberal left (way left) view of reality.

rdquinn — Thu, 17 May 2012 09:36:52 +0000

The following is contained in a letter from Sen Bernard Sanders to the editor of the Wall Street Journal May 10th.

The Journal ignores the most important reason for the Postal Service’s financial troubles: a $5.5 billion annual mandate to pre-fund 75 years of future retiree health benefits in just 10 years. This onerous requirement, unmatched by any entity in the private sector or government, is responsible for more than 80% of the Postal Service’s debt. But for this prefunding mandate, the Postal Service would have posted a profit of $700 million from 2007-2010 and a $200 million profit in the first quarter of this fiscal year. The Senate-passed bill effectively resolves that issue. It also addresses the reality that the Postal Service overpaid $11 billion into the Federal Employees Retirement System.

Early retirement looks pretty good.

While this is technically correct in terms of accounting, it misses the point. We should be concerned why there is such a large liability, not how to manipulate or eliminate the funding which is exactly what got many states in trouble. Various bills in Congress want to waive the retiree medical funding requirement. How’s that for solving a problem? The liabilities exist even if they are not funded even as the USPS continues its financial decline.

The USPS lost $486 million in the period ending March 31, 2012 excluding the funding for retiree medical benefits alluded to by Senator Sanders.

Now consider these facts reported on Bloomberg Business Week:

The postal service wants to reduce payroll by 20%, but union contracts prohibit layoffs.
80% of post offices lose money.
The Bureau of Labor Statistics reports the average hourly compensation for a postal worker is $41 vs $28 in the private sector.
80% of the USPS budget goes to employee salaries and benefits compared with 43% for FedEx.
The last union contract provided for a 3.5% pay increase over the contract period plus seven uncapped cost of living increases.
Postal workers contribute 21% toward their health benefits versus 28% for most federal workers.
79 percent of USPS total costs are the wages and benefits of its employees.

It short, it is the same old story of an unholy alliance between public unions and politicians. Even when postal service management attempts to solve it’s problems their actions are blocked by Members of Congress.

Postal Service loses $3.2B in 2nd quarter (kansascity.com)
Postal Service Scales Back Scaleback: Will Close Nothing, Nowhere (reason.com)

Filed under: Government, Politics

Attacks on Obamacare are attacks on women’s health and well-being.

rdquinn — Wed, 16 May 2012 09:16:04 +0000

The title of this blog post is taken from a call out statement contained in a report prepared by the Center for American Progress as is the quote below. This type of reporting, propaganda or whatever you want to call it represents the worst of politics. The intent is to further polarize Americans by segmenting this group or that and playing on elements of their self-interest.

A quick reading of the first paragraph below and some would conclude that 45 million women first obtained these services because of Obamacare [note how suddenly the President's supporters have adopted the once pejorative "Obamacare."]. The reality is that the 45 million who had such service, most of whom would have had them in any case, have gotten them for “free” and the “free” part is supposed to be a good thing. There probably is no need, but I can’t help but remind readers these services are not “free” at all and such claims are further evidence of either the naivety of proponents or simply their overwhelming desire to promote their agenda despite the facts.

And of course, we can’t forget the insurance industry abuses against women. Never miss an opportunity to take a shot at the scapegoat of choice.

Denial of coverage for “gender-related pre-existing conditions”… as opposed to non-gender-related conditions? Has anyone ever stopped to ask why all these people women, men or otherwise waited until they had pre-existing conditions to apply for insurance? Has anyone asked why children were prevented from coverage for pre-existing conditions when it was universally possible to enroll a newborn without such restrictions provided such enrollment occurred within a certain period? Employer plans have always required a new child or spouse to be enrolled within a specific number of days or to wait until the next open enrollment period. Is that unreasonable to protect against gaming the system and to protect the employer and fellow workers against adverse selection costs? Oh wait, it does require the exercise of personal responsibility and we all know that is a no, no.

Thanks to Obamacare, more than 45 million women have already taken advantage of recommended preventive services, including mammograms, pap smears, prenatal care, well-baby care, and well-child care with no cost sharing such as co-pays and deductibles. Starting this August, millions more will be able to obtain contraception, annual well-woman care (a visit with a gynecologist), screening for gestational diabetes, breastfeeding counseling and supplies, and screening for sexually transmitted infections, including HIV and the Human papillomavirus—again at no extra cost.

In addition, women will no longer encounter discrimination in the health insurance market in the form of lost maternity coverage, higher premiums due to their gender, and denials of coverage for gender-related pre-existing conditions. Indeed, close to 9 million women will gain coverage for maternity care in the individual market starting in 2014. And provisions in the new health law that protect everyone will especially benefit women, who utilize the health care system the most. In short, Obamacare will increase health insurance coverage for women, lower their health care costs, and end the worst insurance industry abuses against them.

Look past the rhetoric on both sides of the health care debate, look at the unintended consequences of the promises made. Consider the promises of “free.”

Is the Fact that I Am a Woman Considered a Pre-Existing Condition? (thehealthcareblog.com)
What’s at stake for women if SCOTUS strikes down health reform. (emilylhauserinmyhead.wordpress.com)
If Obamacare goes, women lose (franjohns.wordpress.com)

Filed under: Healthcare, Politics

Massachusetts seeks to cap growth in health care spending-it’s time to ask HOW

rdquinn — Tue, 15 May 2012 09:35:02 +0000

Pending legislation in the Bay State would target the growth in health care spending to the growth in the Gross State Product (similar to national gross domestic product) give or take a little. The average currently is 3.6% annually.

This is a worthy goal, but waving a magic legislative wand does not make things happen. The Affordable Care Act attempts something similar using the Medicare Payment Advisory Board and many people are up in arms over what they see as a potential move toward rationing. Keep in mind that the growth in health care costs is not primarily caused by the increase in individual fees, but the growth in utilization and the type of utilization (more, and more complex, expensive tests).

In addition, providers must deal with reduced payments and new constraints from the federal government. This is especially true for hospitals.

So, to meet preset spending targets what has to happen? The most obviuous is that all providers must reach an optimum level of efficiency. However, beyond that the care that is provided must change. In other words, less care and less intensive care must be provided. If that means that patients receive better care, only necessary care and no more that’s great. On the other hand, in the unlikely event that is achieved but gross spending does not reach the target, then what?

We are back to the fundamental question applicable to all political solutions … how?

Filed under: Government, Healthcare

The A priori of health care-why ALL health care is unaffordable

rdquinn — Mon, 14 May 2012 09:30:06 +0000

The following is from a recent article in Health Affairs.

Abstract

The pending Supreme Court decision on the Affordable Care Act and the fall presidential election raise concerns about what would happen if the insurance expansion promised by the landmark health reform law were to be curtailed. This paper’s analysis of national survey estimates found that access to health care and use of health services for adults ages 19–64—the primary targets of the Affordable Care Act—deteriorated between 2000 and 2010, particularly among those who were uninsured. More than half of uninsured US adults did not see a doctor in 2010, and only slightly more than a quarter of these adults were seen by a dentist. We also found that children—many of whom qualify for public coverage through Medicaid and the Children’s Health Insurance Program—generally maintained or improved their access to care during the same period. This provides a reason for optimism about the ability of the coverage expansion in the Affordable Care Act to improve access for adults, but it suggests that eliminating the law or curtailing the coverage expansion could result in continued erosion of adults’ access to care.

While I do not make light of the problems many people face who do not have health insurance, nor do I deny the need for expanded coverage, I find the basic assumption that virtually nobody can afford even modest health care intriguing. Look at the above abstract, could it be that half of the people in the group did not need to see a doctor or that they chose not to see a doctor or dentist for reason unrelated to their coverage status? Could it be that children received more care because much of the care was free or that children naturally use services more than twenty somethings?

I have written on this concept many times before, but I still find it fascinating and one of the reasons we may never truly solve the health care problem even if we evolve to a single payer system.

I am convinced the average person does not see any health care expense as something they should be responsible to pay. Consider all the goods and services a person buys in a year beyond the very necessities of food, clothing and shelter and then tell me where paying for a doctors office visit lies in the list of priorities.

The fact is when we decide what we cannot afford, health care is near the top of any list ahead of real necessities like going out to eat, a trip to Disney for the family or even a weekly trip to the nail salon (think “The Pill” unaffordable co-pay).

Of course I am not talking about catastrophic level expenses for which we all need insurance, but that is a long way from buying supplemental coverage to pay our 20% coinsurance or mandating an array of services to be “free”. Heck, seniors routinely buy Medi-gap coverage to pay for things they paid for themselves before they had Medicare without any cost-benefit rationale.

Does anyone seriously think that those now free services are not actually affordable to most people if they chose to spend their discretionary dollars that way? Rather, we need to make them free because we know people will always choose to spend their money otherwise even when it is in their best interest to receive the health care.

Think how different and more affordable health care would be if the only coverage available was for hospitalization, medical and surgical care inpatient and fixed dollar benefits for laboratory, x-rays and the like … exactly the way it was when I started working in the health benefits field in 1961.

Filed under: Healthcare

Bi-partisan cooperation is alive and well. Democrats and Republicans will meet to seek mutual cooperation

rdquinn — Sun, 13 May 2012 01:40:05 +0000

There is a ray of hope; politicians of both parties announced that later this year there will be a joint Republican-Democrat convention to seek consensus on the most pressing issues facing the country. The photo below shows the organizing committee hard at work.

Filed under: Politics

Left/Right where the heck is the center?

rdquinn — Fri, 11 May 2012 10:45:02 +0000

Long time Senator Richard Lugar was defeated in a recent primary in favor of a candidate supported by the Tea Party. Rush Limbaugh is beside himself with joy. Granted Sen. Lugar is 80 years old and has been on the job for thirty-five years and since I strongly favor term limits and not congressional careers, he should have retired long ago, but that’s not the point.

Lugar is known for taking a bi-partisan approach in dealing with issues. It seems to me that the last thing this Country needs now is a Congress with its members at the extreme ends of a tug if war with the American people on the abyss of the mud pit in the center of the rope.

I don’t think we are getting anywhere!

During the health care reform debate, Republicans moaned (and rightly so) about the Democratic-controlled Congress doing pretty much what it wanted and ignoring or belittling any opposing ideas. However, by throwing out middle of the roaders seeking compromise and results in favor of the far right and their singular point of view, aren’t Republicans hoping to do the same thing for which they attacked Democrats? Just askin…

If all we have is the extreme left and the extreme right banging heads or worse if we elect a great majority of either party, we are going nowhere. Well, in fact, we are going somewhere and I doubt we will like it when we arrive.

Filed under: Politics

Her name is Julia and her birth to death government benefits are what you will be voting on come November

rdquinn — Thu, 10 May 2012 08:45:50 +0000

The Obama campaign has introduced a cartoon character named Julia to convince Americans of all the government goodies in place and on the way for this young lady (and by implication, you). Of course paying for them and meeting the already created long-term liabilities are not mentioned in Julia’s story.

Here is an excerpt from an opinion piece in the New York Times and the full articles is here.

Her name is Julia, and she has the lead role in an Obama 2012 slide show that follows what’s supposed to be an American everywoman from childhood into retirement, tracking everything the Obama White House’s policies would do for her and everything the “Romney/Ryan” Republicans would not. The list of Obama-bestowed benefits includes Head Start when Julia’s a tyke, tax credits and Pell grants to carry her through college and low-interest loan repayment afterward, guaranteed birth control when she’s a 20-something and government-sponsored loans when she wants to start a business, all of it culminating in a stress-free retirement underwritten by Medicare and Social Security.

There is more at stake than Julia’s promised benefits. The fundamental role of government in our lives and the dependency we place on government provided programs is what really matters. Oh yes, one other little thing also matters … How (and who) will we pay for all these programs?

If you think it’s the other guy who will pay for Julia’s contraceptives, subsidize her loans or child care, I think you are wrong.

Filed under: Observations on life

When a hospital overnight stay is not an admission

rdquinn — Wed, 09 May 2012 07:00:20 +0000

A May 1 story in USA Today raises an interesting issue about the practice of holding patients in a hospital for observation, but never actually admitting them under Medicare rules. As may be expected, hospitals use this gap in logic to make a few extra dollars and Medicare uses it to save money and in the process to shift costs to patients.

The main cost shift occurs because drugs supplied to patients under these circumstances are not covered by Medicare. Hospitals, seeing an opportunity to add revenue charge patients an inflated price for a drug, often many times what the patient would pay at a pharmacy.

If you are held in a hospital and it is unclear of your status you or a relative should confirm whether or not you have been “admitted.” If you are told you are being held for observation, you need to confirm what charges you may incur that will not be covered by Medicare, including your Part D plan.

Filed under: Medicare

Beyond Suzy Orman and Dave Ramsey-the simple secret to financial security that your grandparents or great grandparents knew

rdquinn — Tue, 08 May 2012 13:15:09 +0000

Step one: Enter your net income after all taxes and required deductions (including health insurance).

Step two: Subtract savings of at least 10% to build and maintain an emergency fund and for retirement, etc.

Step three: You may spend the difference, in other words this is what comprises your standard of living and no more.

Step four: Never use credit cards to make purchases that will not be fully paid within the billing period (or don’t use them at all).

The number that results from step three determines the kind of car you can drive, the type of housing you will have, how often you can enjoy some extras like eating out, vacation, etc.

Maybe the answer for now is you drive a Yugo, rent a one bedroom apartment, actually cook all your food at home and never take a vacation. That by the way is just about how my parents lived…except for most of the time, they couldn’t afford a car.

Now, if you are not happy with the number in Step three, you have to do something about it. That “something” does not include spending more than the amount in Step three to enjoy some extras or keep up with the Joneses. The “something” you need to do includes things like getting a second job even one related to french fries, developing marketable skills, starting a small side business, coming up with creative ways to make more money, perhaps selling something you are good at making, working as much OT as you can get, taking a paper route, write a blog with advertising, the possibilities are endless. It may not all be fun or even enjoyable, but you do what you have to do to reach your goals. See I told you it was simple.

At some point you may decide you are never going to reach a number in Step three that makes you happy and allows you to live as you would like. When that happens, it’s time to look into the mirror and ask a few questions. Do I have the skills and training to move ahead? What decisions have I made so far that limit my ability to do better? What do I really need to do to change things? Is there something about my attitude that is holding me back?

Or, you could take another route and join a protest blaming someone else for that lousy Step three number.

When I was seventeen, I had two goals that I recall very clearly. One was to own a Mercedes and the other was to be a millionaire by age forty-five. Well, I am nearly age 69 and I don’t own a Mercedes and instead of being a millionaire by age 45 it was then that we started a journey of one, two or three children in college each year for the next ten years. But missing those goals doesn’t bother me because I learned along the way your priorities quickly change and sleeping at night with no debt, paying cash for what you want and spending money on things other than “stuff” does have its own rewards.

The downside I suppose is to get to that point you must work a lot of years, perhaps work more than one job, definitely put up with a lot of crap and aggravation and find creative ways to make the things you want to happen, happen. That is not always simple or easy, it’s called life.

Filed under: Observations on life Tagged: Financial planning, life style, net income, Standard of living, Suzy Orman