Tag Archives: Patient Protection and Affordable Care Act

Pre-existing conditions, mischaracterized and an incomplete discussion

12 Dec

The Obama administration makes great fanfare about helping people with pre-existing conditions obtain health insurance. The Administration likes to characterize the issue as insurance company discrimination and “egregious insurance company practices.” See the HHS press release below. The reality is that people affected by pre-existing conditions have several existing options. Newborn children and new spouses usually have a period of time, typically 30 days, to enroll without concern for a pre-existing condition or a minimal waiting time for coverage related to the condition.

In addition, there are two existing laws that protect people with pre-existing conditions. COBRA guarantees an extension of coverage in the group plan for a period of time, generally 18 to 36 months. The Health Insurance Portability and Accountability Act of 1996 was enacted August 21, 1996. Under HIPAA individuals are protected from pre-existing condition waiting periods when changing or losing a job. HIPAA is being overlooked in the discussions about pre-existing conditions in favor of Obamacare. As long as someone is sufficiently responsible to keep coverage, with only short breaks, if any, then they can get new coverage. Responsible is the key word as it usually is. At no time in the discussion of health care reform have I ever heard why or how people get into the position of not having health insurance because of a pre-existing condition. Rather, we see the result and ignore the cause which is not insurance company practices.

Clearly a main driver for the absence of health insurance is cost, now and in the years ahead. That and some people simply playing the odds and not buying insurance. To think that is going away as a result of Obamacare is naive. The fact is that gaming the system will continue. In fact, the gaming ability will be enhanced when the health insurance exchanges are in place, when premiums are subsidized and community rating is required in setting premiums with minimal differentiation between even young and old. Even the mandate to carry insurance with its low penalty will not deter some people.

These costs will not go away, they will merely be spread among all insured Americans and the government.

Following is the text of a notice that has been included in employer health benefit plans for the last sixteen years. Note the last sentence.

HIPAA Certificates

Under HIPAA, after your medical coverage ends, the Plan Administrator will give you a written record of the coverage you had received through your Employer (referred to as a certificate of group health plan coverage) and, if applicable, under COBRA. You will receive a coverage certification when:
• Your coverage through your Employer ends;
• Your coverage under COBRA ends; or
• You request coverage certification (if the request is made within 24 months following the end of coverage).

If you obtain future employment, you may need to submit the coverage certification to your new employer. The coverage certification may reduce the duration of any pre-existing condition limit under the new plan by one day for each day of prior coverage you had, subject to certain requirements. If you are purchasing individual coverage, you may need to present the coverage certification at that time.

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The ongoing concern about Obamacare

26 Nov

September 3, 2009 health care reform rally at ...

We are less than a year from implementation of the linchpin of Obamacare; enrollment in the health care exchanges is to begin in October 2013. Nearly three years after passage the law is still controversial.  As designed and presented Obamacare is to make health care affordable to all Americans, greatly expand coverage and improve benefits under health insurance and Medicare. The improve benefits part is well underway, the expanded coverage and the affordable parts are less certain.

Obamacare is paid for in several ways; (1) new taxes and fees on employers, insurance companies and health care related industries, (2) new taxes on higher income individuals, and (3) cuts in payments to Medicare Advantage plans and Medicare health care providers. In addition, there is the hope that scores of new delivery and payment models such as accountable care organizations and various bonus programs under Medicare will serve to control costs.

The concern many people have is that all these changes to the health care system coupled with the increased demand for care caused by millions more people with coverage will increase, not lower health care costs overall. What is saved by the federal government may only be shifted to the private sector. New mandated benefits and elimination of underwriting requirements will be reflected in higher premiums. New fees and taxes on the health care industry will eventually be reflected in the cost of their products and services.

Aside from the potential impact of all this on the average American, the greatest risk is the unknown impact on federal spending as a result of what amounts to a massive new entitlement program.

If all the changes related to Medicare don’t prove as effective as planned (and the Medicare Actuary and Trustees have reservations about their long-term practicality), Medicare costs may not be controlled or have actually been accelerated.

However, the real unknown is the ongoing cost of the open-ended liability created through subsidizing individuals enrolled in the health insurance exchanges. The Law provides refundable and advanceable tax credits and cost sharing subsidies to eligible individuals. Premium subsidies are available to families with incomes between 133-400% of the federal poverty level to purchase insurance through the Exchanges, while cost sharing subsidies are available to those with incomes up to 250% of the poverty level. Four times the federal poverty level is nearly $90,000 a year making most Americans eligible. Although many people currently have coverage through the workplace, an unanswered question is how many individuals with employer based coverage will move to a subsidized exchange in the future.

Equally important is whether health care costs are controlled significantly. If not, those costs will be reflected in premiums and thus the federal government’s cost to provide the subsides and tax credits within the exchanges will escalate beyond projections.

As with any massive government program intended to be permanent, there are easy to see benefits and not so easy to see long-term risks and liabilities. Millions of Americans are enjoying the benefits of Obamacare today; the long-term affordability of the Law as structured remains to be seen. Both Social Security and Medicare are of immense importance to nearly fifty million Americans today and millions more in the future, but the failure to manage such programs as they and the U. S. population evolved provides an example of the risks for Obamacare.

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The Medicare Independent Payment Advisory Board, death panels and the liberal left’s rose colored glasses

20 Nov

Protest sign: The Nazis already tried death pa...

If ignorance is bliss, there sure must be a lot of happy people running around.

Here is what a November 18, 2012 New York Times says about the new Medicare Independent Payment Advisory Board (IPAB); what the irresponsible and incorrect Right has described as the “death panel.”

What you read below is correct, but actually that is the real problem. Look at the words I placed in bold. When you consider all that the Board is prevented from doing by law, there is nothing left but to cut provider payments.

Supporters pass over those words like it’s no big deal, like there will be no impact on the entire health care delivery system. They ignore the already scheduled cuts taking place or the coming 30% cut in physician fees next year (or the fact Congress has not allowed past scheduled cuts to take place) and they ignore the concerns about these cuts contained in the Medicare Trustees Report, not to mention the likely cost shifting to the non Medicare population that will occur.

The Right spreads false information about death panels and such while the Left looks at words on a page of the law and assumes everything will be as written with no consequences unintended or otherwise. They are both wrong!

The board, known as the Independent Payment Advisory Board, has been the subject of false attacks over the past few years by Republicans who claim that it will ration care, disrupt doctor-patient relationships, and tell patients what treatments they can receive. That is an outlandish way to describe a board that is prohibited by law from making any recommendations to ration care, raise premiums, increase cost-sharing, restrict benefits or limit eligibility.

The board will consist of 12 experts, including doctors, patient advocates, employers and financial analysts, who will be appointed by the president and confirmed by the Senate, and three nonvoting government officials. Its sole duty is to monitor and, if necessary, reduce Medicare spending, which needs to be reined in to control deficits.

If the projected growth rate in per capita Medicare spending exceeds specified targets pegged initially to an average of general and medical inflation and later to gross domestic product, the board must recommend changes (most likely cuts in payments to health care providers) to bring the growth rate back in line. Congress can override the board’s recommendations, but it must still find equivalent savings.

The Congressional Budget Office has estimated that repealing the board might drive up federal spending on Medicare by $3.1 billion over a decade. Without pressure from such a board, Congress is apt to be weak in resisting demands by powerful health care groups and industries for higher Medicare reimbursements.

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You Tube video on Obamacare – beware more Internet garbage and this video is a good example

22 Sep

Garbage (song)

Everything you see and hear on the Internet is NOT true

I hesitate to include the link to this garbage, but in fairness, I suppose if you are interested, you should see it. The video is either an unbelievable display of ignorance or a conscious effort to mislead for the purpose of drumming up oppoosition to health care reform.

Keep in mind that it is not true and is utter garbage.

There must be a full moon that brings out the dingbats who prepare such nonsense, but lately I have received several e-mails with this link in it.

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Fixing Medicare – regardless of the method, the result is the same… Medicare as we know it cannot continue!

7 Sep

Benefit Security Card .. HALF of the U.S live ...

HALF of the U.S live in households that receive government benefits

There is a lot of controversy these days about Medicare. The only consistent truth is that Medicare can’t survive left as is, as we know it if you will. The 2012 Trustees Report says the hospital fund will be exhausted in 2024 and that Part B costs will grow at an annual rate of 7.6%. The funding for Part B comes from general revenue and Part B premiums. In other words adding to the national debt and placing greater pressure on Medicare premiums. This growth rate is likely because the Trustees assume that the 30% cut in payments scheduled for 2013 will not go into effect while noting dire consequences if it does.

The current structure of Medicare allows beneficiaries to choose between traditional fee-for-service Medicare and Medicare Advantage Plans (Part C).  This is private, for profit coverage.  Over 25% of Americans with Medicare have opted for Part C. The Ryan plan continues the choice approach with one big difference, the growth in the government’s contribution toward premiums would be limited rather than increase as costs increase on an open-ended basis. Initially the premium support would be based on the lower of the cost for traditional Medicare or the second lowest cost competing plan. However, overall costs for Medicare could not exceed a benchmark based on growth in Gross Domestic Product for the US. In other words shifting from a defined benefit to a defined contribution approach to limit government spending.

Under the Affordable Care Act choice between traditional Medicare and competing plans under Part C remains. However, the government contribution toward Part C plans is gradually being reduced to levels closer to the cost of traditional Medicare. Over time this likely will mean higher premiums for Medicare Advantage Plans and/or reduced benefits. Not unlike the Ryan plan, current law sets spending targets for Medicare. If those targets are exceeded, cuts are required. This is accomplished through the Independent Payment Advisory Board established by the Affordable Care Act beginning in 2015. To meet the spending limits the IPAB must make recommendations but cannot reduce benefits or raise premiums and as a result is fairly limited to recommending further reductions in payments to health care providers. The Medicare Trustees Report says it is unlikely the already scheduled cuts will be allowed by Congress because they have not been allowed to go into effect in the past. In any case, it is hard to see how the system can withstand these cuts and any further cuts necessitated by the IPAB.

The fundamental difference between these two approaches is the way spending targets are reached. The Ryan plan sets hard caps and allows beneficiaries to adjust to rising costs by choosing among competing plans. The Affordable Care Act cuts payments to health care providers and competing plans, but ultimately relies on an appointed board to make further cuts in payments to providers.

Ultimately both approaches affect Medicare beneficiaries with higher costs. This may come from higher premiums, lower benefits or simply higher out-of-pocket costs because it will be more difficult to find a doctor accepting Medicare. Addressing Medicare’s long-term costs primarily by squeezing health care providers has consequences for the non-Medicare population as well because reducing already low payment levels will cause more shifting of costs.

Fixing Medicare means shared pain regardless of the approach. The question is how best to share that burden among all Americans and the health care system.

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What is your opinion of the Ryan plan for Medicare?

26 Aug

The split in opinion about the plans to reform Medicare is somewhat surprising, but we need more people to speak up.

Please take a few seconds to add your opinion to our poll shown on the right side of this page.

Cast your vote on this important poll

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When health care reform does not control costs, the Massachusetts (and ultimately the U.S.) experience

10 Jul

I recall in 2008 speaking with a Congressional aid about health care reform. I told him the Massachusetts model might expand coverage but it wouldn’t control costs. This PhD basically told me I didn’t know what I was talking about.

Read on …

But while the 2006 health care reform was successful at providing near universal coverage, Gonzaleaz said, it didn’t control costs.

The state has reduced its health-care costs for the current and next fiscal years by about $1.5 billion, he said.

Through an active re-enrollment and targeted incentives, the Group Insurance Commission enrolled a third of state employees in limited network plans, saving the state more than $20 million and those employees hundreds of dollars, Gonzalez said.

The Health Connector Authority also reduced per-member premiums by 10 percent over the last two years, saving more than $100 million, he said.

The state also has helped municipalities reduce their health care costs through landmark legislation last year to establish an expedited process for municipalities and their employee unions to modernize benefit plan designs to achieve savings, Gonzalez said. Nearly 100 communities have leveraged the law to achieve more than $100 million in premium savings in the first year.

Here is the full story.

Now take note of what he is really talking about. I’ll translate for you. To “modernize benefit plan designs,” to provide “targeted incentives” and to enroll in “limited network plans” is benefit speak for cost shifting.  In other words to lower premiums (mistakenly taken for health care costs) each employee takes on more health care cost risk. Obamacare is no different. In fact, with expanded mandated benefits premiums will be forced higher even as other cost shifting occurs.

The people who like Obamacare point to such things as coverage for children to age 26, ”free” preventive services, guaranteed coverage, “affordable” health care meaning subsidized premiums or artificially forcing premiums lower without regard to the underlying costs.  But none of that makes health care truly affordable. Proponents point to all the programs that are trying to change the system such as accountable care organizations, changes in fees to doctors and hospitals, etc., but these programs do not affect anyone except those Americans covered by Medicare, roughly 15% of the population. In addition, putting the squeeze on Medicare means those costs are likely to end up in the private sector.  You simply can’t change one part of the system and think there will be no impact on the rest of the system.

Obamacare may provide direct benefits to millions of Americans, but in doing so it also sets the stage for growing, not shrinking costs.  The federal government has committed to ever-growing subsidies for Americans with family incomes up to $85,000 or so, it has expanded Medicare benefits even while claiming to cut Medicare payments to insurers and providers.  Unless you fundamentally change the health care delivery system for all Americans within the same timeframe as these expanded benefits, you have set in place a liability that grows at more than twice the rate of general inflation.

Whether you are for or against Obamacare, you need to ask; what is the next step when costs continue to escalate along with government spending on health care.

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Obamacare … It’s the law; enough is enough it’s time to move on

29 Jun

English: United States Supreme Court building ...

Today I listened to Limbaugh rant and rave about the Supreme Court’s decision upholding Obamacare. I listened to several other conservative talk shows as well all singing the same song.

In the space of a few minutes I heard that you better get your hip replacement now or you won’t be able to have it, I heard about a 3.8% tax if you sell your home and that Congress should have the same health care system as the rest of us (tell me what system that is if you know). I heard about rationing and death panels and all the other nonsense. Callers to these shows were even worse displaying a level of ignorance and disseminating misinformation with gusto.

What I didn’t hear was a proposal for a viable alternative that would expand coverage and really make health care affordable (not that Obamacare does). That’s not entirely true, Hannity talked the same nonsense about free market competition solving the problem (not sure who is competing for what though). Boy, do I long for some intelligence in the conservative community, where is William F Buckley when you need him?

Anyone who has been reading this blog knows I am no liberal or enthusiastic about Obamacare. It contains many flaws, will cost way more than predicted and does not address the fundamental problems with our system beyond scores of demonstration projects for Medicare. However, valid criticism must be based on facts and that is not happening in much of the right-wing zone.

Look through the posts under the Healthcare and Government categories on this blog and you will see how I have tried to get the facts exposed although I must admit getting the facts out there doesn’t mean people pay any attention.

Nobody is repealing Obamacare so we better move on and work seriously to fix what needs to be fixed, get an honest assessment of the costs and look for real ways to change what needs to be changed in the US health care system, and yes that means what care we receive, when we receive it, how much we receive and what we pay for it.

There is a lot of work to be done.

Then we have the White House view of Obamacare. A view that focuses not on the need to change the system but rather on perceived new benefits. This is the real danger of Obamacare, the idea of more for everyone with little regard to the cost and consequences. The free and easy use of “affordable” without substance and the ongoing shots taken at insurance companies are red flags of major concern.

E-mail from the White House:

Let’s take a look at what today’s ruling means for the middle class:

Insurance companies no longer have unchecked power to cancel your policy, deny you coverage, or charge women more than men.

Soon, no American will ever again be denied care or charged more due to a pre-existing condition, like cancer or even asthma.

Preventive care will still be covered free of charge by insurance companies–including mammograms for women and wellness visits for seniors.

By August, millions of Americans will receive a rebate because their insurance company spent too much of their premium on administrative costs or CEO bonuses.

5.3 million seniors will continue to save $600 a year on their prescription drugs.

Efforts to strengthen and protect Medicare by cracking down on waste, fraud, and abuse will remain in place.

6.6 million young adults will still be able to stay on their family’s plan until they’re 26.

A major impact of the Court’s decision is the 129 million people with pre-existing conditions and millions of middle class families who will have the security of affordable health coverage.

We should also remember that under today’s ruling, having health insurance is and will continue to be a choice. If you can’t afford insurance or you’re a small business that wants to provide affordable insurance to your employees, you’ll get tax credits that make coverage affordable. But if you can afford insurance and you choose not to purchase it, the taxpayers will no longer subsidize your care for free.

To gain insight into the mindset of the people running things today, consider this statement  from the above White House e-mail:“Efforts to strengthen and protect Medicare by cracking down on waste, fraud, and abuse will remain in place.“  Since when do managers and administrators need a law to crack down on waste and fraud?  This problem has been brought to governments attention for the last twenty-years.

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Medicare’s Independent Payment Advisory Board – what it is and isn’t . . . ethics panels and more nonsense

7 Jun

Can we just be a little rational?

Not only do we have irrational e-mail floating around, now Youtube is getting into  the act.  You may not like or agree with most or all of Obamacare, but at least base your objections on facts, not hype or grossly misleading information perpetuated by what I have to call misinformed extremists.  Hey, I think Obamacare is not only wrong but immensely expensive given that it does not address the real issues and misleads people as to the cost and the cause of our health care concerns. However, we need to get past the rhetoric both for and against and focus on the facts.

Following is the text of another bogus e-mail and a link to a YouTube video on the same subject.  After you give them their proper due and have a good laugh, take a look at the text below of a previous post on this blog which contains the words from the Law regarding the Medicare Independent Payment Advisory Board.

By the way the words  ”ethics panel” or “ethics board” do not appear anywhere in the Affordable Care Act.  The word “ethics” appears about seven times all related to the behavior of employees in health care organizations.

Creative YouTube nonsense.

Text of bogus e-mail:

Subject: If you or someone you love is 75 or older

In a conversation about the “future,” Dr. Suzanne Allen, head of emergency services at the Johnson City Medical Center in Tennessee, was asked if she has seen any affects of Obama Care in her work.

“Oh, yes. We are seeing cutbacks throughout the services we provide. For example, we are now having to deal with patients who would normally receive dialysis can no longer be accepted. In the past, there was always automatic approval under Medicare for anyone who needed dialysis — not anymore.” So, what will be their outcome? “They will die soon without dialysis,” she stated.

What about other services? She indicated as of 2013 (after the election), no one over 75 will be given major medical procedures unless approved by locally administered Ethics Panels. These Panels will determine whether a patient receives medical treatment or not. While details on specific operating procedures and schedules, Dr. Allen points out that most life-threatening emergencies do not occur during normal hospital business hours, and if there are emergencies that depend to be resolve within minutes or just few hours, the likely hood of getting these Panels approval in time to save a life are going to be very challenging and difficult, if not impossible she said.
This applies to major operations such as receiving stents, bypass surgery, kidney operations, or treating for an aneurysm that would be normally covered under Medicare today. In other words, if you needed a life-saving operation, Medicare will not provide coverage anymore after 2013 if you are 75 or over. When in 2013? “We haven’t been given a specific date — could be in January or July….but it’s after the election.”

This is shocking to any of us who will be 75 this year. Her advice — get healthy and stay healthy. We do not know the specifics of the actual implementation of the full Obama Care policies and procedures — “they haven’t filtered down to the local level yet. But we are already seeing severe cuts in what we provide to the elderly — we refused dialysis to an individual who was 78 just the other day….we refused to give stents to a gentleman who was in his late 80s.” Every day, she said, we are seeing these cutbacks aimed at reducing care across the board for anyone who is over 75.

We can only hope that Obama Care will be overturned by the Supreme Court — otherwise, this is a death sentence to those who are over 75… perhaps you should pass this on to your friends who are thinking of voting for Obama this year.

Regardless if you have private health care coverage now (a Medicare supplement) — it will no longer apply after 2013 if the Ethics Panels disapprove of a procedure that may save your life. Scary, scary, scary. Think about this. You? Your parents? Your loved ones?
Didn’t know about it? Of course, not. As Nancy Pelosi said….”well, if you want to know what’s in the bill, you’ll have to read it…” after it was passed.

This is a graphic reminder of the need to stay healthy. Get your plot now at Forest Lawn… while they last. Is this a death sentence to those of us who will reach 75?… Yes!

Please do pass this along to those in your address book.

The following is from a post on quinnscommentary.com post over a year ago:

Rush Limbaugh’s Death Panels   The Obama Plan to save money for Medicare

No, it is not a death panel as I heard Limbaugh yelling on the radio, but neither is it likely to generate much in the way of savings. Here is what the new health care law says about Medicare’s Independent Payment Advisory Board, the group of fifteen. I added the bold to point out some key points. For the most part this Board does not even deal with Parts A and B of Medicare.

Sec. 3403 as modified by Sec. 10320. Independent Payment Advisory Board.

This provision establishes an Independent Payment Advisory Board to develop and submit detailed proposals to Congress and the President to reduce Medicare spending. The Board is to consist of 15 members with expertise in health care financing, delivery, and organization. All members are to be appointed by the President and confirmed by the Senate. Proposals are to primarily focus on payments to MA and PDP plans and reimbursement rates for certain providers. The Board will be prohibited from developing proposals related to Medicare benefits, eligibility, or financing. Proposals, which will only be required in certain years, will have to meet specific savings targets. Recommendations made by the Board automatically go into effect unless Congress enacts specific legislation to prevent their implementation. The first year the Board’s proposals can take effect is 2015.

Scope of Proposals. The provision lays out a number of specific fiscal and policy criteria which the Board will be required to meet in making its recommendations. When developing and submitting proposals, the Board is required, to the extent feasible, to (1) prioritize recommendations that would extend Medicare solvency and target reductions to sources of excess cost growth; (2) include only those recommendations that improve the health care delivery system, including the promotion of integrated care, care coordination, prevention and wellness and quality improvement and protect beneficiary access to care, including in rural and frontier areas; (3) consider the effects of changes in provider and supplier payments on beneficiaries; consider the effects of proposals on any provider who has, or is projected to have, negative profit margins or payment updates; (4) consider the unique needs of individuals dually eligible for Medicare and Medicaid, and (5) include recommendations for administrative funding to carry out its recommendations.

As appropriate, each proposal is required to include recommendations that would reduce spending in Medicare Parts C and D. Reductions could be obtained by reducing Medicare payments for administrative expenses to MA and PDP plans, denying or removing high bids for drug coverage from the calculation of the monthly bid amount for Part D plans, and reducing performance bonuses for MA plans. Recommendations may not target the base beneficiary premium percentage or the full premium subsidy for Part D plans.

The Board is prohibited from making recommendations that would ration care, raise revenues, increase beneficiary premiums, increase beneficiary cost-sharing, restrict benefits, or modify eligibility. Additionally, proposals submitted before December 2018 for implementation in 2020, cannot include recommendations that would reduce payments to providers and suppliers scheduled to receive a reduction in their payment updates in excess of a reduction due to productivity.

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New Report: Employers will save billions by dropping health care benefits…it’s not a good thing!

7 May

The House Ways and Means Committee has released a report showing the potential savings large employers could realize by dropping their health benefits, paying a fine and turning employees loose on the individual insurance market. Admittedly this is a highly political document that draws conclusions of a questionable nature in the real world.  However, the very idea that employers will seriously consider dropping employee coverage is scary.  There are big dollars at stake here and no doubt there are some CFOs and CEOs who would very much like to get out from under the unpredictable costs of health care benefits…as many have already done for their retired employees.

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One can make a case that this coverage should not be linked to employment. In addition, workers who receive employer-sponsored coverage clearly have an advantage over those who must purchase coverage on their own.  Neither point makes the case for throwing the baby out with the bath water (a reference to the medieval practice of giving babies the last bath in the same water during the annual family washing).

I spent nearly fifty-years designing and managing health benefit programs for a Fortune 200 company.  I know the value this type of coverage provides to tens of millions of workers and their families.

Employer coverage provides a wide arrange of benefits beyond the financial advantages for workers. Virtually all large employer plans are self-insured; only the use of health care by the workers and their families are considered in setting premiums.  This means that workers can affect the cost of their care. Employers negotiate the best deal for administrative costs.  Most employers hear and resolve disputed claims or oversee the process if outsourced. Employers communicate extensively with employees about their benefits and health care issues.  Employers provide an array of services and programs to assist employees in obtaining care and manage their care and costs.  Employers have an incentive to manage costs beyond any applicable to an insurance company. Many employers will assist their workers in dealing with problems, they handle enrollment, and even assist workers negotiating with high fee, non-participating providers.  Most large employers provide several choices in health plan options.

On his Forbes blog Avik Roy writes:

Free-market reforms, on the other hand, would increase consumer choice, by giving workers control over their own health dollars. Under a free-market system, workers could stay with their employer’s plans, or buy insurance on their own that better suits their needs. For example, young, healthy workers could take dollars out of their company’s expensive plan and steer them towards high-deductible insurance combined with a health savings account.

Note to Mr. Roy, most workers do not want more choice and indeed are afraid of choice, afraid of making the wrong choice. Large employers are already adding HDHPs within their array of choices and this allows the experience for the entire group to be aggregated.  Setting up a system that allows young, healthy workers to leave the employer plan is called adverse selection and would add to the cost of coverage for the remaining workers and the employer eventually creating a death spiral as new young individuals are employed.

In summary, workers are far better off within an employer sponsored plan than they would be on their own deciding which plan and insurer to use and then having only the insurer selected to deal with problems and concerns that arise.

While there is no indication that large employers are seriously considering dropping health benefits en mass, with escalating costs and the growing number of federal mandates and compliance requirements that situation could change in the future. It would not be a good thing, be careful what you wish for.

Washington, DC – Today, in a new report prepared for Ways and Means Committee Chairman Dave Camp (R-MI), data from America’s Fortune 100 companies show they could save hundreds of millions of dollars a year under the new health care law by simply terminating health insurance for their workers and dumping these employees into taxpayer-funded health care exchanges.  

More than 70 percent of America’s Fortune 100 companies detailed their health care costs for the Committee, providing the ability to analyze how those self-reported costs would compare to ending employer-sponsored insurance and paying the employer mandate penalty.  Based on an aggregation of the data received, if the 71 Fortune 100 companies that replied to the survey ceased to offer health care coverage and paid the employer mandate penalty, they could save a total of:

  • $28.6 billion in 2014 (an average savings of over $400 million per company) and
  • $422.4 billion from 2014-2023 (an average savings of nearly $6 billion per company).

“The findings of the report, along with existing research, show that the Democrats’ health care law threatens the stability and sustainability of the employer-based health insurance system,” said Camp.  “Anyone who gets insurance through their job should be worried about what will happen next, because there is a distinct financial incentive for employers to terminate health care coverage under the Democrats’ health care law.  It is clear to me that because of this law, Americans will not be able to keep the health care plan they have and like.  American workers and taxpayers simply cannot afford to have this law remain on the books.”

The report is entitled “BROKEN PROMISE:  Why ObamaCare Will Force Americans to Lose the Health Care Coverage They Have and Like.”  Click here for the key findings, and here for the full report.

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The real reason contraception is “free” under the Affordable Care Act

6 Apr

Most people, including me, think mandated coverage of contraception was a result of the Affordable Care Act and the Institute of Medicine that is charged with making recommendations related to preventive services that should be covered at 100% by health insurance.

Recently, I found a copy of the website my.Barackobama.com dated November 3, 2008.

Here is what it says:

Barack Obama is an original co-sponsor of legislation to expand access to contraception, health information and preventive services to help reduce unintended pregnancies. Introduced in January 2007, the Prevention First Act will increase funding for family planning and comprehensive sex education that teaches both abstinence and safe sex methods. The Act will also end insurance discrimination against contraception, improved awareness about emergency contraception, and provide compassionate assistance to rape victims.

Think Contraception Logo

So you see, the full and “free” coverage of contraception was a long-planned goal and likely had little to do with the IOM recommendation, but more with an ideology that it is the federal government’s responsibility to solve just about any problem American’s face. Here we also see the claim of “insurance discrimination,” key rhetoric in promoting the idea that virtually every health care related expense should be covered and with minimal or no cost.

Once the Affordable Care Act was passed including discretion for the Secretary of HHS to designate preventive services, there was no need for separate legislation.

The President’s perspective may also have something to do with the fact that 72% of black American children are born to unwed mothers and many of those to teenagers. That indeed is a problem for the individuals involved and for society. It is a social crisis, a moral crisis and one that will not be solved by making the pill “free” especially given that many of the people involved already have access to contraception at minimal or no cost.

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Insurance coverage mandates are nothing new

2 Apr

The United States Supreme Court. The individual mandate to carry health insurance is under the microscope with a very basic question as to whether Congress has the authority to make such a requirement. Frankly, I don’t know the legal answer and given a unanimous verdict by the Supreme Court is unlikely, I guess no one else is 100% certain either. However, it seems to me that there is more than one way to create a mandate.

Take Medicare for example. Do you really have a choice of enrolling in Medicare? The obvious answer is yes you do, but hold on, is it a real choice? If you don’t want Medicare, can you buy other coverage instead? No you can’t, nobody can sell such coverage. Even coverage that supplements Medicare is regulated by the federal government and there is talk of trimming the coverage you can buy to pay your Medicare co-pays and deductibles.

Some people in Congress think too much insurance coverage leads to higher costs … they may have a point.

If you continue to work and have employer health coverage, you must keep your employer coverage even when you turn 65, you can’t use Medicare as your primary coverage even if you wanted to. Before this requirement was part of the Medicare law employers generally required you to use Medicare with the employer plan as supplemental.

If you delay enrolling in Medicare beyond your initial enrollment period, there is a penalty to pay. For Part B that penalty is ten percent for each year of delayed coverage; for Medicare Part D the penalty is 1% for each month you delay enrollment. In addition, you may enroll only during a three-month enrollment period held once each year. The reason for all this is simple; to prevent adverse selection when people enroll in coverage only when they anticipate using the benefits.

It seems that rules and regulations and penalties abound regarding your choices of health care, at least when you are as old as I am.

Granted the above are implicit mandates, but in the final analysis are they much different from the requirement to carry health insurance contained in the Affordable Care Act? This is the same logic used for the individual mandate under the Affordable Care Act; if you don’t take coverage, you pay a penalty to partially offset the additional cost created by those who enroll only when they expect to use the coverage. I am still free to not enroll for health insurance, but rather than pay a surcharge or suffer a delay in coverage when I decide I need it, I am required to pay an upfront penalty.

Such limitations and penalties are designed not to protect the individual, but the pool of insured that must eventually carry the cost burden for less responsible citizens. Boy, I’m glad I am not on the Supreme Court.

This debate all comes down to these rather simple words crafted by our Founders in the Constitution outlining the rights of Congress:

To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes;

The essence of the argument seems to be whether Congress is creating commerce by requiring coverage and then regulating what it created.  Frankly, I think I could argue this either way and that’s scary. What is even scarier is that a one sided Congress hell bent on getting its way could not craft a better way to reach the same goal of expanded coverage without creating a Constitutional crisis. Arrogance has its unintended consequences too.

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Are we serious about health care REFORM or just the promotion of “more?”

27 Mar

Nancy-Ann DeParle, director of the White House...

Nancy-Ann DeParle, director of the White House Office for Health Reform, at a senior staff meeting in the Oval Office. (Photo credit: Wikipedia)

I have long maintained that health care is too emotional for any of us to look at costs and efficiency objectively. We see or hear that a person was fully covered by their insurance and it’s a good thing.  An insurer was made to pay for this or that and it’s a good thing.  The idea that we care about cost is questionable and when it comes to ourselves or a loved one, there is no question that we do not care about the cost of health care at all.  It’s human nature after all and the very reason external control of some type is necessary if we are to seriously manage costs.  That control may come in the form of managed care, following certain guidelines for care, etc.

 
That human nature factor in health care does not go unnoticed by our politicians who cannot resist playing up the individual benefits of health care reform without regard to the cost.  At the same time that the Secretary of HHS trumpets the Department declining “unreasonable” premium rate increases, the White House promotes all the aspects of the affordable Care Act that increase costs.  This is not to say helping individuals is a bad thing, but it is also a costly thing and that simply cannot be pushed under the rug as if it does not matter.
 
We all know certain individuals are benefiting from the Affordable Care Act. Any time you give people more stuff and “free” stuff somebody is going to benefit and somebody else is going to pay for it.
 
If we can’t look at the cost of our own health care objectively, we should expect our most senior policymakers to do so for us collectively.  Good luck with that as it appears their main objective is promotion of all the goodies.   That is a great disservice to us all.
 
Text of e-mail from the White House:

Good afternoon – 

Too often in Washington, politicians tell compelling stories about individuals when they are trying to make a point. But once the news cycle moves on, those people keep living their lives and confronting the same problems. 

Health reform is different. 

We met Nathan and his son, Thomas, in 2009. Thomas was born with hemophilia, and he hit lifetime limits on his health coverage with two different insurance companies before he turned seven years old. Two years ago, Nathan was hopeful about what the Affordable Care Act would mean. 

Last week we spoke with Thomas’s family again and they made it clear: Health reform has improved their quality of life. It means they can focus on making sure Thomas has the best possible care. It’s changing their lives for the better. 

It’s a powerful thing to watch. Go check it out. 

Thomas is not alone. He’s just one of the 105 million Americans who no longer have lifetime dollar limits on their coverage. 

The Affordable Care Act gives hardworking, middle class families the security they deserve. Because of health reform, 54 million Americans with private insurance have been able to access more preventive services. In the 2011 tax year, two million workers will benefit from the small business health insurance tax credit. And 2.5 million young people under age 26 have gained coverage on their parents’ plan. 

Behind each of those numbers is a person like Thomas. Two years after President Obama signed the Affordable Care Act, life is a little better for millions of Americans from all over the country. 

So take a moment to hear some of their stories and hear why this matters for Americans across the country: 

http://www.whitehouse.gov/health-care-story 

Thanks,

Nancy-Ann 

Nancy-Ann DeParle
Deputy Chief of Staff 

P.S. — Learn about more individuals who are benefiting from the Affordable Care Act with our map that shows the impact of reform, state by state.

 
 
 
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How much health care can $10 a week buy?

20 Mar

In the 1980s while negotiating a union contract I was trying to make the case for raising the deductible and coinsurance in the health benefits plan. As part of my pitch I made an analogy with other forms of insurance.  What I said was that if you look at auto insurance, it doesn’t pay for an oil change or new tires.  One union representative said his wife had just had surgery and did I expect him to pay for that. The point was that not everything is insurable and some cost sharing is fair and desirable.  What I got back from the other side of the table was, “Are you comparing my wife to a car?”

The Health Lottery

Actually, I was comparing spending $20 on an oil change and $20 on an office visit coinsurance, but that didn’t matter.  That “Are you comparing my wife to a car?” syndrome is not unusual because we cannot get past the attitude that paying for health care is not the top priority for spending our money.

Here is another way to look at this.

Georgia residents spent an average $470.73 on the lottery in 2010, or 1 percent of their personal income.  Only Massachusetts (STOMA1) had higher spending, $860.70 per adult, more than three times the U.S. average. Georgia had per capita income of $34,800 in 2010, below the national average of $39,945, while Massachusetts’s was higher at $51,302, according to data compiled by Bloomberg.

In fact, in Georgia the median household income 2006-2010 was $49,347 and 15.7% of the population is below the poverty level. Under the Affordable Care Act a family with an income of $50,000 will receive a premium subsidy a little over $12,000 per year plus cost-sharing subsidies up to an additional $3,600 per year.

Clearly spending several hundred dollars on the lottery is not equal to the cost of health insurance, but the lottery is not the only non-necessity people spend money on. In other words, what is unaffordable is a lot more than health care, but we tend to reset our priorities so that the $80 office visit is unaffordable, but the lottery ticket is not.  Go figure.

Logically our priorities would be more like this:

  1. Food
  2. Shelter
  3. Health care
  4. Clothing
  5. Saving
  6. Retirement
  7. Education
  8. Other stuff
  9. Vacations
  10. Gambling

Exactly where are our priorities?  What is affordable?

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