Borrowing Your Way to Health

Here's a thought: say your insurance doesn't cover Lasik surgery. Or dental (or other) implants. But you want (or need) that procedure, and the bank account's running a bit low.

What to do?

Well, if you've got an HSA, or access to an HRA or FSA, then you may have enough to cover the cost (or can get there quickly enough) that it's not an issue.

But what if you don't?

Well then, how about borrowing the money (ah, debt: the American way!) to pay for it?

Believe it or not, there's a growing number of folks who are doing just that. And the providers themselves are helping.

Anyone who's bought (and financed) a car in the last 50 years knows that the dealership has a "finance guy" just itchin' to talk terms and deals. After all, it's extra profit, and guarantees that the inventory will move. Taking a nod from Crazy Larry's Used Car Emporium, more and more doctors (and, of course, other providers) are offering financing options for their patients.

I began to see this a few years ago, when Lasik was $5,000. Per eye. Not many folks could afford that much all at once for what is, generally, an elective procedure. But make it $29.99 (per month), and all of a sudden it becomes a lot more doable.

"But as the price of health care continues to rise and big lenders pursue new areas for growth, this type of medical financing has become one of the fastest-growing parts of consumer credit, led by lending giants like Capital One and Citigroup and the CareCredit unit of General Electric."

Depending on how one sets it up, there may even be some positive tax results from such deals.

According to the Wall Street Journal, "(t)he mortgage-lending market may be a mess, but lending people money to get health care is a booming business." This "new" market is attracting some big names in the financial services sector: Capital One and CitiGroup, for example, are introducing new, zero-percent loans for qualified customers. Like the discount cards we've also discussed, these come with a built-in time bomb: pay off the loan on time, or the rate skyrockets.

Still, for folks on a tight budget (or with unfunded high deductibles), these kinds of loans may be appropriate.

And it's not just the financiers who are putting these deals together. Insurers are also looking for creative ways to make a few extra bucks. In fact, at least one company is touting a product that encourages (and facilitates) its insureds to take out loans to cover unreimbursed expenses.

Is this "a good thing?"

It depends, one supposes, on how much more debt a given insured/patient can really handle. And on whether providers will "hard sell" services that may not be medically necessary, in order to bolster their own practice's bottom line.

There's another factor at play here, as well. If you've been watching the news, you know that the credit market is taking a tumble, and "creditworthiness is starting to be judged even more stringently, in light of the subprime mortgage crisis’s impact on the debt markets." So if you want (or need) that non-covered procedure, you'd better be sure that all your other debts are caught up, as well.

Oh, and one last thing: as we've discussed before, non-covered medical expenses aren't eligible for in-network pricing, so you're on your own when negototiating both the cost, and the financing, of these procedures.

If You Knew Sushi (Like I Knew Sushi)

A recurring theme here at IB is the advisability (or lack thereof) of a nationalized, gummint-run health care system. Over the years, we've examined (and dismissed) such systems as the "much vaunted NHS" of our cousins across the pond, the broken and bleeding system of our neighbors to the north, and others.

Still, some of our commenters (whose comments are almost always appreciated) insist that there must be some system, somewhere, that "meets the test." Often, they'll point to our Japanese friends as having "gotten it right."

Um, no:

"(A) woman in labour was turned away by eight hospitals.

A ninth hospital refused to admit her even after she miscarried in an ambulance and her baby died."

Turns out, national "free" health care comes with a pretty steep price-tag: rationing. That is, because such systems discourage potential docs from pursuing high risk specialties ("why bother, I'll never make it back?"), appropriate care is often difficult to find.

Now, one may argue that we sometimes have similar problems here in the 'States. And one would be right. And wrong: when providers in our "broken, inefficient, smelly system" screw up like this, they're closed down. Period.

Not so in the land of the rising sun:

"Last year a pregnant woman who lived in the same area died after she was refused admission by about 20 hospitals which said their beds were full.

The problem is there are neither enough doctors in Japan, nor emergency facilities."

Ooops.

Still think we oughta go there?

(H/T to Captain's Quarters)

Seen any Pilgrim's (life insurance, that is)?

[Updated - please see below]

A colleague of mine is trying to help one of his clients, and has asked for my assistance. We're looking for a specific carrier: Pilgrim Life Insurance Company of Indianapolis, Indiana.

I've checked with A M Best, and MIB, and the NAIC.

Struck out with each and every one.

Very few companies actually cease to exist altogether; most of those that have "gone missing" have been gobbled up by larger and larger entities (which will eventually stop once Conseco owns every other carrier). I used to have a link to a site that would have helped (one input the name of the target carrier, and the site would return its most recent owner). Alas, that was apparently several PC's ago, and I can no longer find that link.

So, if you've got any suggestions, or know what's become of old PLIC, please let me know, via the comments section (or email), where they ended up.

Thank you!

UPDATE: Thanx to our alert and resourceful (not to mention good-looking) readers, we've tracked 'em down. A special Hat Tip to Fred and Rick, both of whom were able to dig up the relevant contact info. There's actually a really cool story behind this company (and the one which bought it); I'll be blogging on that anon.

UPDATE THE SECOND: You'll find "the rest of the story" here.

Some Thoughts on LTCi

It's been a while since we've discussed the role and importance of Long Term Care insurance (LTCi) coverage. But as our population ages (and the "Boomers" are now knock, knock, knockin' on Medicare's door), the need for asset protection becomes more and more critical.

And make no mistake about it: LTCi is about protecting assets, not people. In that regard, it's much more closely related to homeowners than life or even health insurance.

Hunh?

Well, let's look at it this way: one of the most prevalent uses of life insurance is to replace income.

But homeowners insurance is primarily about protecting the asset that is your house (and, of course, its contents). If it were to be burgled, you'd want some help replacing the new plasma TV, and maybe that van Gogh you had hanging on the wall [ed: yeah, riiight!]. If there were a fire, you'd want some help cleaning up the mess, and rebuilding your dream home.

In the same way, if you need long term care, you'd want your assets to last as long as possible, to preserve your choices (and, perhaps, your dignity). And that's how LTCi works: it enables you to use less of your own hard-earned money (cash, stocks, whatever) while you receive care that's generally excluded by Medicare.

Of course, there's Medicaid, but that requires a costly "spend down" process, which can quickly drain away all those hard-earned dollars.

Don't believe me? Well, let's see what The Street's Senior Health Analyst, Donna O'Rourke, has to say on the subject:

"If you haven't considered long-term care insurance yet, this might be a good time -- and not just because health care costs are spiraling. More and more states are developing long-term care partnership programs that make it easier for you to protect your nest egg." She adds "(t)he cost of long-term health care can easily burn through your life's savings."

In fact, according to industry leader Genworth Financial, home health care (let alone in a nursing or other long term care facility) costs an average of $53,000. It's not hard to see how quickly one can "burn through" one's nest egg.

As Donna mentions, many states have now set up "partnerships" to encourage (and help) folks to purchase their own coverage. One of the "perks" of these plans is that participants get a break on the Medicaid spend-down rules, which would look primarily to exhaust the policy, not one's bank account.

Currently, over a dozen states have set up (or begun to set up) these partnership arrangements, with another 15 or so "on deck." To check to see whether or not your state is on board, check with your professional, independent agent (this kind of insurance is definitely not DIY), or your state's Insurance Department.

Don't put it off.

Cavalcade of Risk #33 is up!

Jane Hiebert-White, of the Health Affairs blog, hosts this week's edition, dedicated to the anniversary of the tragedy of Hurricane Katrina. I can think of no more fitting example of all the aspects of risk (assessment, management, you name it) than what happened in NOLA two years ago.

Do check it out.

(We also have some Fall '07 hosting opportunities available, just drop us a line if you're interested).

Piling On...

Okay, just one more post on that silly Commonweath Fund study (and its recent followup). Seems that the CF got caught playing a little fast and loose with how they weighted the criteria used in assessing the relative quality of nations' health care systems. John Stossel comes to the rescue (again!), pointing out that having EMR (electronic medical records) is not as important as, you know, saving actual lives:

"The proportion of patients who say they got infected at a hospital counts about the same in the "quality" measure as the proportion of doctors who use automated computer systems to remind them to tell patients their test results. Those things aren't equal in my book."

As a bonus, John quotes FoIB (and Cato Institute's Director of Health Policy Studies) Michael Cannon, who pretty much nails the CF "study" right on the noggin:

"The report does nothing more than reveal which nation does the worst job of satisfying the subjective preferences of the people who conducted this study."

That's gonna leave a mark.

Another Royal Fisking (Mortality v Morbidity)

UPDATE & BUMP: Please see the important update at the end of this post.

Recently, the results of a new study has been making its way around the medblogosphere, with predictable results: our broken, run-down, leaky, smelly health care system has led us to rank 42nd (internationally) in life expectancy.

Quick, someone get me an umbrella: the sky is falling!

Um, no:

Contrary to the headlines ("Lack of insurance, obesity, racial disparities to blame"), the mortality rate is not the same as the morbidity rate. The former addresses the number of deaths in a given population, while the latter reflects its health (or lack thereof). While they are, of course, related, correlation is not causation.

My favorite quote comes from Dr. Christopher Murray, of the University of Washington:

“Something’s wrong here when one of the richest countries in the world, the one that spends the most on health care, is not able to keep up with other countries,” he sanctimoniously opines.

Really?

How many illegal (and often unhealthy) aliens are clamoring at the borders of Guam, Japan or Italy? (Clamoring to get in, that is) Think our burgeoning population of such folks might have some effect on our national health care, and mortality, picture?

And that's really the point: we'd need a lot more information to tell how much, if anything, the life expectancy numbers have to do with quality of health care. For example, we learn from the CDC that 75 % "of the more than 40,000 deaths each year among persons aged 10-24 years in the United States are related to preventable causes such as motor-vehicle crashes (37%), homicide (14%), suicide (12%), and other injuries (e.g., drowning, poisoning, and burns) (12%). " That's not a reflection on our health care system, but on our priorities and culture.

Need more proof? No problem:

Again according to the CDC, heart disease and cancer account for almost half of all deaths in the US. But how, exactly, does that indict the health care system? We spend enormous sums in research and treatment of these conditions, but if folks won't stop smoking, and start excercising and eating a more healthful diet [ed: hey, you talkin' to me?!], there's precious little that "the system" can do about it.

Not to pile on [ed: riiiight!], but columnist and TV newsguy John Stossel has more: "The WHO [report] judged a country's quality of health on life expectancy. But that's a lousy measure of a health-care system. Many things that cause premature death have nothing do with medical care. We have far more fatal transportation accidents than other countries. That's not a health-care problem.

Similarly, our homicide rate is 10 times higher than in the U.K., eight times higher than in France, and five times greater than in Canada.

When you adjust for these "fatal injury" rates, U.S. life expectancy is actually higher than in nearly every other industrialized nation."

And he agrees with my arguments about lifestyle choices, as well:

"Diet and lack of exercise also bring down average life expectancy."

Finally, and this is the one that always frosts me, the authors drag out the oft-repeated (and always debunked) canard about our "sky high infant mortality rate." Truth is, the leading cause of infant mortality in the U.S. is "congenital malformations, deformations and chromosomal abnormalities." There's no evidence that our doc's are less capable of dealing with these than physicians in other countries.

More importantly, though, is the statistical sleight of hand that proponents of this myth like to pull. That is, citing infant mortality numbers without proper context: in many countries (even "developed" ones), infants with severe or fatal conditions aren't even counted as live births (or are aborted when diagnosed), whereas we do everything we can to save such innocents. One may argue the efficacy of such an attitude, but we value life.

Case closed.

UPDATE: While we're on the subject of mortality and morbidity, and specifically discussing how health care affects either one (if at all), perhaps some current, updated info may be of value:

"Cancer survival rates in Britain are among the lowest in Europe, according to the most comprehensive analysis of the issue yet produced."

Indeed, despite the fact that the "much vaunted NHS" spends more than three times more on health care than Poland, the Polish cancer mortality rate is almost the same as Britain's.

So for cancer, at least, increased health care spending does not translate to better health care outcomes.

Grand Rounds

This week's Grand Rounds is hosted by Susan Palwick at Rickety Contrivances. She's using the new carnival template of including all submitted (relevant) posts, but highlighting the creamof the crop. That must have been a challenge, given the 23 posts she's got (and she's also included helpful context with each one).

Go check out the best of the medblogs.

Insurers Behaving (Very) Badly

I'd originally planned to post this as another in our "Stupid Carrier Tricks" series, but this strikes me as so egregious that the term "tricks" doesn't do it justice.

I still believe that most carriers follow the letter, if not the spirit, of the law when investigating and adjudicating claims. But I may have to rethink that position in light of this:

"During the private talks, church members confessed abortions, sexual orientation issues, drug addictions and other dark secrets.

No one knew the couple wasn't actually interested in joining the church. Instead, they were private investigators hoping two church members, Bill and Leandra Pitts, would spill something they could use to discredit the pair in an ongoing lawsuit over a traffic accident.

The private eyes even tape-recorded the sessions."

Turns out, the Pitts' were involved in an automobile accident, in which they were not at fault. They maxed out the at-fault driver's insurance, and apparently filed under their own underinsured motorists cover. Their own carrier, Progressive Northern Insurance Company (which, according to A M Best, is a subsidiary of "the" Progressive insurance folks) instigated this outrageous and morally indefensible action against their own insureds.

Words fail me.

Well, words appropriate for this family-friendly blog.

What these "investigators" were hoping to learn at a church-run encounter group escapes me, but they must have figured that their own ends justified this dastardly means.

It seems to me that Progressive owes the Pitts a public apology, and swift, unquestioning payment of their claim.

It's the very least they can do.

(H/T to Bill Montgomery, CIC)

Carnival Monday!

Two jam-packed financial carnivals today. I am simply amazed at (and impressed with) both the number and the quality of the posts.

First up, the Carnival of Personal Finance is up at Free Money Finance. Our host picked a Fav Five, out of a mind-boggling 76(!) entries. And he didn't stop there: each one has a little blurb explaining the nature of the post. Kudos!

Over at Reasoned Audacity, Jack Yoest presents this week's Carnival of the Capitalists. Presented almost as a story, each post (all with helpful context) seems to flow into the next one. And with over 3 dozen posts, that's quite a feat. Very well done!

Food Pyramid Update: Scandis Rule

It's been a few months since since we last updated our (in)famous food pyramid, so this tidbit seems timely:

"Drinking wine or beer could reduce the risk of kidney cancer, according to a new Swedish study."

I, for one, remain grateful to the Swedes, whose bikini teams and lutefisk extravanazas remain high on my list of "accomplishments which should have won the Nobel Prize" (which, if I'm not mistaken, originated in Sweden, as well). This news, of course, only cements the Scandinavian reputation for cutting edge scientific breakthroughs.

Interestingly, the study found that it takes more than the occasional social sip to provide a meaningful firewall against that dread disease: researchers determined that "the risk was reduced in people who drank more than two glasses of red wine a week, or comparable amounts of white wine or normal-strength beer."

Cheers!

Hot Insurance Tales

From time to time, we do post items relating to the Property/Casualty (P&C) side of the biz. This is one of those times:

"A private fire crew dispatched by a national insurance company that caters to wealthy clients is guarding 22 high-end homes threatened by the Castle Rock Fire, a blaze that has forced the evacuation of hundreds of million-dollar homes west of Ketchum."

It actually makes sense: if AIG (the firefightin' insurer here) figures the claim's going to top $20 million (22 homes, at least $1 mil apiece), then this is cheap "insurance" to dodge an expensive bullet.

It even has the blessing of the Forest Service (why not?).

Who knew insurance could be so exciting?

Cavalcade of Risk #33: Submissions Due

Just a reminder that submissions for next week's CoR are due Monday (the 27th). Our hostess, Jane Hiebert-White of Health Affairs blog, asks that you PLEASE include:

■ Your blog's url

■ Your post's url

■ The post's trackback URL (if available)

■ A (brief) summary of the post

You can submit them via Blog Carnival or email.And we still have Fall '07 hosting slots available. Hosting is fun, easy, and gets you off the "nag" list. Just drop us a line!

(Doctors) Behaving Badly

[Welcome, Industry Radar readers!]

This fall, United HealthCare is coming out with some new group plans (yippee). One of the interesting "twists" is that the co-insurance reimbursement rate (the "80" in "80/20") will be substantially lower for patients/insureds who choose not to go to a "designated provider." That is, it's not enough that your doc is "in the network;" he must be "designated" ("super qualified," whatever) in order for you to receive the best level of benefits.

UHC's new program isn't unique, but these programs raise some interesting questions. Perhaps the most curious would be "okay, that's nice, but what about the other doc's, the ones who didn't make the cut?" Not that this is anything new: a few months ago, we reported on the case of Dr Michael Kelly, who was unceremoniously dumped by both Blue Cross and United. Well, not "dumped," per se, but no longer designated as a "high quality doctor." The tip of an iceberg, perhaps?

Well, you may not be surprised to learn that physicians like Dr Kelly are not happy campers. Over at Managed Care Matters, our friend (and sometimes foil) Joe Paduda reports on the steps these "also rans" are taking to regain their good names (and cash flow). And as is usual at MCM, the resulting comments are every bit as interesting as the post itself.

Health Wonk Review

Daniel Goldberg, blogging at Medical Humanities, presents this week's amazing HWR. In addition to excellent posts (presented in an easy to follow manner with lots of useful context), Daniel takes the time to explain medical humanism in the context of both Martin Luther and the Catholic Church (although I'm puzzled as to why he left out Spinoza).

In an interesting (and unusual) twist, Daniel put my post (debunking a recent Reuter's article) at the top, and then proceeded to argue with it. In fact, he responds to almost all the posts. I think that's great: the point of blogging, IMHO, is to elicit conversation and reactions.

As an insurance agent myself, I found Brian Klepper's series on the value of my chosen profession to be quite interesting. Brian's been subbing for medblog biggie Matthew Holt, and he's not convinced that brokers are really worth what we're paid. While I disagree with his conclusions, I do agree that there are definitely some areas where we need to do MUCH better at policing ourselves. Recommended.

Holdin' Down the Costs

According to accounting/research biggie PriceWaterhouseCooper (PWC), the incredible acceleration of health care costs (and hence, insurance costs) is beginning to ease up. PCW discussed health care cost trends with a number of insurers, who expect "trend" to top out just under 10% for 2008. This is actually lower than the double-digit numbers we've seen the past few years.

[Graphic courtesy of Employee Benefit News]

It's important to remember that trend is not the same as rates. That is, how much higher health care is expected to be is but one factor in determining how much an insurer will charge. Lower trends have a positive impact on rates, of course, which is good. It also underscores our mantra here (originally and succinctly promulgated by Mike Feehan) that "health insurance costs increase because health care costs increase." Amen.

There's actually a lot of interesting information in the report; for example, carriers are expecting prescription drug costs to slow down a bit, an increase in EMR and other digital applications, and more widespread adoption of transparency tools. According to the report, prescription drug costs accounted for some 14% of all health care costs this past year, while physician charges represented the lion's share (35%).

I was pleased to see that HDHP rates are expected to rise much less (25% less, in fact) than more "traditional" HMO and PPO plans. That's good news, indeed. Of course, by shifting some of the costs of health care back to those who actually use it, it follows that there would be more careful utilization, resulting in lower health care expenditures (and cost). Kind of a win-win deal.

The report itself is pretty easy reading, and is available (in pdf form) here.

Grand Rounds

The medical student who runs Med-Source has put together a terrific Grand Rounds for this week. With over 20 posts, helpfully categorized with interesting commentary, it's a real delight to behold.

One of the hats I wear is Continuing Education instructor (for insurance). We do ours the old fashioned way: live and in-person lecture format. We've toyed with the idea of moving at least some of our efforts into online courses, but haven't quite bitten the bullet yet.

No so with with Nurse Kim from Emergiblog; she's about to start her 2nd semester of classes using the online model. Working toward her BSN (Bachelor of Science in Nursing), she's actually increased the number of hours she's putting in using her PC and the 'Net to attain her goal. Kudos, Kim!

Dragon/Ennie Update

Regular IB readers may recall our recent post about gaming award nominee Fat Dragon, in contention for the coveted Ennie Award for Best Miniature Product. We had asked for your help in making this entrepreneur's dream come true.

Well, I just received a phone call that FD has, indeed, won the award, the very first time it was even nominated.

Mazel Tov, Tom, and we're proud and delighted to have been of help!

Carnival Time!

Blogger Trent of The Simple Dollar hosts this week's edition. As has become somewhat customary, he's chosen a "Top 10" list, followed by the rest of the entries that were submitted.

And this week's Carnival of the Capitalists is available at Revenue River. Host Scott Allen presents a terrific compendium of capitalistic posts.

And there's this: we've been noticing that the Cavalcade of Risk has been receiving a lot of "spam" posts -- pieces allegedly written by bloggers but in actuality nothing more than press releases -- and apparently the CotC has been receiving similar garbage.

What's terrific is that Scott has called them out on it, and actually published the names and links of the offending bloggers. Bravo, Scott, bravo!

Too Much Scotch in the Water?

What is it with the Scottish NHS (National Health Service)? As we've recently noted (here and here), the Scots' health care system seems to be (not so) slowly imploding. And as if to further illustrate the point, we have the latest from the land of Glenfiddich:

"CANCER patients are still waiting up to seven months for treatment. Patients are supposed to be treated within 62 days of urgent referral...In the worst cases, sufferers were kept hanging on for 220 days."

To be fair, some 85% of Scottish cancer patients are seen in the recommended "window" of 62 days. However, the two-year old target is 95% of those affected to be seen in that time frame.

One region, Lanarkshire, "had the poorest performance, with just 70.3 per cent of patients being seen within the target time." Ooops.

Our neighbors to the north strive for a 66 day maximum wait.

In fairness, I have not been able to find the relevant numbers for the US. I encourage IB readers to share that information (with links and facts) in the comments section; I'll update this post early next week.

Stupid Government Tricks #899

From time to time, we highlight some the effects of government-sponsored health care rationing in countries touting "universal health care." And much like those gloves that promise "one size fits all," such schemes generally end up fitting everyone poorly.

Such is the case of the Scottish health care system's recent decision regarding the use medications such as Aricept. In its infinite wisdom, the Scottish National Institute for Health and Clinical Excellence (NICE) labeled that class of drugs as "not cost- effective in early Alzheimer's." The med will apparently still be available to folks in the later stages of the terrible disease, but not those recently diagnosed, who may have seen their declining condition slowed somewhat.

Notice that they didn't say "non-efficacious." They simply classified them as cost ineffective. On the one hand, perhaps they're right (after all, they're responsible for saving Scottish dollars (pounds? euros? whatever), and here's a quick and easy way to do just that. On the other hand, this action removes another potential tool from MacDocs seeking to treat their senior patients.

I guess it's bad news for Nessie.

Donorcycles

WARNING: What follows is a mini-rant only tangentially involving insurance.

I think the Darwin Awards are a hoot: these are little newsbits about the various and imaginative ways foolish people have used to remove themselves from the gene pool. I also think mandatory helmet laws are bad: I think morons that choose to ride without helmets should be free from government-mandated encumbrances.

But I also think that those who do choose to ride without a helmet should be willing to take the personal responsibility that comes with that choice. I would support a law which said that such folks are entilted to no special lifesaving services (up to and including CareFlight) if and/or when they become one with the undercarriage of a Mac truck or Chevy Malibu.

Alternately, I would support a law which states that folks who ride helmetless have explicitly empowered the state to harvest their (usable) organs immediately, with no medical care due other than keeping such folks alive long enough to get those organs safely to the nearest hospital.

Okay, I'm done; thanks for listening.

Cavalcade of Risk #32 is up!

Thanks to Chris Burdick for an outstanding Cavalcade of Risk. He stepped in at the last minute, and did a great job. Check it out.

And consider hosting your own Cavalcade edition. Just drop us a line for details.

Kudos to "Dr No"

I'm among that group of fans who believe that Dr No was the best Bond film of the genre (although the newest reimagination was pretty darned good). But this post isn't about the fictional Spectre villain; (Dr) Tom Coburn is the Oklahoma Senator who's earned that epithet for his frequent use of "holds" to bottle up bills that "violate his core principles."

And which kinds of bills are those? Well, they include "any new federal program that is not paid for, or anything that might duplicate another program, or anything that might be unconstitutional."

And that's why he's put the (temporary) kibosh on the Senate version of legislation prohibiting the use of genetic information in insurance underwriting (H.R.493). Among other things, the bill would "prohibit a group health plan from adjusting premium or contribution amounts for a group on the basis of genetic information."

On the face of it, the bill seems innocuous enough: after all, why should folks be penalized for things over which they have no control (i.e. their genes)?

Would that it were that simple.

But the fact is, such prohibitions already exist at the state level, so a federal limitation would be redundant. Even more important, it's a bad idea: underwriters have a number of tools at their disposal, and genetic testing just isn't one of them.

But for the sake of argument, let's say that it was, and that it was used.

So what?

How is that any different than testing for HIV, or tobacco, or cocaine? On a group basis, any one of those factors may (or may not) go into the mix in order to arrive at a reasonable final rate. Thanks to HIPAA, groups can't be declined on the basis of health, and states have put caps on how much a given group may be surcharged.

Speaking as one whose own genetic makeup would fall squarely in the sights of such a tool, I would have no problem with its use. Why not? Because insurance is a mechanism of risk management, and in order to effectively manage a given risk, one must have an accurate assessment of it.

There's another problem with the proposed legislation, as well: it's poorly written.

How's that, you may ask?

Well, as "Dr No" points out, "the current language of the bill is that the definition of genetic test is inconsistent.” One has only to read the bill to see that this is so. While that may seem an excercise in picking nits, it is actually a major flaw: since the definition of what constitutes such a test is fluid, the trial bar would have a field day interpreting what underwriters use as criteria in their assessment of a group. This in turn could (would?) lead to even higher premiums.

And nobody wants that.

Changing 'Rounds

This week's Grand Rounds, hosted by Christian at Med Journal Watch, focuses on change: for the better, for the worse, or "just 'cuz." And each of the 40(!) posts has an extensive description of the content and context, which makes it even more interesting.

We've written a lot about "mini-meds" over the past year or so; David Williams, proprietor of the Health Business Blog hasn't been a big fan of them. But he's gradually coming around to seeing that they may offer some value. An interesting and thoughtful journey.

Carny Time!

This week's Carnival of the Capitalists is hosted by Spooky Action, blogging out of hot, arid Arizona. He's got a very cool carnival, though, with 4 dozen posts. He also has a "Top 10," which includes our very own Bob Vineyard's post on health care costs. Yay, Bob!!

Since we're on the subject of sensitivity, I found this post on how to respond to racist humor to be quite timely. Carmen Van Kerckhove blogs at Race in the Workplace, and has some helpful tips.

NHS: PC Run Amok

On the one hand, for once I'm not slamming nationalized health care, per se. In fact, this cautionary tale could happen in any large institution. On the other hand, it shows what can happen when bureaucrats take a pefectly reasonable goal (sensitivity to folks' beliefs) and take it to absurd lengths:

"HOSPITAL staff in the Lothians* have been told not to eat at their desks to avoid offending Muslim colleagues during Ramadan. NHS Lothian has advised doctors and other health workers not to have working lunches during the 30-day fast, which begins next month."

* A Scottish electoral region

While I'm all for folks having the freedom to worship as they please, this seems to me to be going overboard: does the NHS prohibit its non-Jewish staff from eating breads, buns and doughnuts during Passover? Of course not (or so one would hope); each of us should be free to practice our faiths as we see fit, but elevating one person's faith above everyone else's (which is exactly what this edict does) is demeaning and insulting.

Bill Aitken, a Scottish legislator, seems to have the best take on the situation: "Frankly, this advice, well meaning as it may be, is total nonsense. This is the sort of thing that can stir up resentments rather than result in good relations."

No kidding.

Primary SmackDown at Joe's Place

This is a medblog, not a poliblog, but FoIB Joe Kristan has an absolutely brilliant, funny, pithy fisking of a fellow blogger's disdain for Joe's beloved Hawkeye State. If you need a chuckle (and perspective on the Ames straw poll), head on over to Roth & Co.

Thank me later.

Sicko: The Untold Story

Over at Abducens Nucleus blog, the physician/host has a powerful, detailed takedown of the rose-colored picture many folks have of nationalized health care schemes.

Here's a taste:

"One in three households surveyed tried and failed to gain timely access to at least one health service within the previous three months. And in one study, the total waiting time between referral from a general practitioner and specialty care averaged nearly 18 weeks. Even the Supreme Court has weighed in on the unacceptable delays in care. But the lawsuit is not against a dreaded American HMO and the events did not happen in the U.S. All were byproducts of the Canadian health care system."

That's gonna leave a mark.

H/T Hugh Hewitt.

Unconscionable - Update

Almost exactly two months ago, we reported on a sickening story out of Los Angeles:

"(T)he folks in the ER at Los Angeles' Martin Luther King Jr.-Harbor Hospital and two different 911 dispatchers, who refused to send an ambulance to help the poor woman find some of that reasonable and necessary care. As a result, the 43 year old woman died of massive internal bleeding."

That was apparently the last straw (or close to it):

"Martin Luther King Jr.-Harbor Hospital shut down its emergency room Friday night and will close entirely within two weeks, a startlingly swift reaction to a federal decision to revoke $200 million in annual funding because of ongoing lapses in care."

On the one hand, that will most certainly create a major health care shortage in that area of LA; on the other, I'm not convinced that's a bad thing, compared with the incredibly poor care MLK was providing.

Hat Tip to Captain's Quarters.

Careful What You Wish For...

The Southwest Ohio health care market has certainly seen its share of discord the past few years. And thanks to The Industry Radar, we have this news from the Dayton Business Journal:

"An alliance between the Health Alliance -- minus two members -- and Premier Health Partners could be in the works...the Health Alliance and/or Jewish Health System are exploring a merger or affiliation with the Dayton system."

Gee, didn't see that one coming.

The reality is, as problematic as the health insurance market is hereabouts, it's really no more dysfunctional than the health care market. And, as we've pointed out numerous times, the latter drives the former.

If I had to guess (and heck, that's the beauty of blogs: we get to opine all the livelong day), I'd say that this bodes more seriously for the Cincinnati market than the Dayton. Why, you ask? Well, Premier has recently signed relatively long-term deals with the two 800 pound insurance gorillas (guerillas?), Anthem and UHC. But the Cincinnati market is in flux; it's a much larger market, as well, serving southern Ohio as well as northern Kentucky.

The truly interesting geographical wild card here is Middletown (so-called because it's roughly halfway between Dayton and Cincinnati): Premier is based in Dayton, but "owns" Middletown Regional (MRH), which also serves the northern suburbs of Cincinnati.

The two outlyers (Christ Hospital and the St. Luke's) left the Cincinnati-based Health Alliance earlier this year, presumably hoping to make up for lost contracts with increased revenues. Looks like they may have miscalculated.

Don't you just hate when that happens?

It's all very incestuous.

The two larger communities continue their inexorable crawl towards each other, which may ultimately leave MRH in an enviable position. Of course, Christ and St Luke's are now calling foul, but it seems to me that their own voluntary exile from the Health Alliance mitigates any such claim. The real winners here may be us consumers, as competition drives down costs.

On the other hand, the real losers here may be us consumers, as former competitors link up, squelching competition.

We'll keep you posted.

D'oh! And No (Fisking Reuters)

■ D'oh:

"Adults aged 19 to 29 are the biggest group of the newly uninsured, according to an independent research group's report released on Wednesday."

The Commonwealth Fund's report claims that these folks comprise almost a third of those without health insurance (if one buys the 45 million number, which we've disputed numerous times). Of course this group of "invincibles" represent a disproportionate number of uninsured folks (whether by choice or not).

■ No:

"Young adults, many who are [sic] just entering the workforce and can't afford the high cost of individual insurance."

Of course they can, but many (most?) choose not to spend their wages on something which they perceive (rightly or wrongly) as a waste of money. This is actually a much bigger problem than the report suggests: insurance carriers have strict participation requirements, mandating that a certain percentage of eligible employees sign up. When these "young invincibles" take a pass, the group suffers.

And there's a more insidious implication, as well: since the insurer essentially considers the premiums young folks (especially males) pay as "free money" (because their expected claims are so low), they help to subsidize older employees' premiums. One may argue the fairness of that situation, but not the fact that it is so.

Of course, young 'uns are the the beneficiaries of some of the most intense insurer marketing campaigns we've seen recently: Anthem's Tonik and UHC's Belay plans are aimed squarely at this demographic. And why not? They have disposable income and few responsibilities.

In a deft little sleight of (statistical) hand, Reuters also offers this gem:

"U.S. Census and other data cited by the report show 40 percent of the uninsured young are in households earning less than the federal poverty level."

And your point is?

Oh! It's an attempt to draw a correlation between two distinct groups of people: those who choose not to buy insurance (the 30%) and those who have access to myriad government-sponsored care (the 40%). Nice try, guys!

Frankly, the only really surprising thing here is that the 30% number seems low.

■ Au Contraire:

And finally, this little nugget: "the nonpartisan Commonwealth Fund."

Um, no:

According to OpenSecrets.org, CF's Chairman, Dr Samuel O. Thier, donated $2,000 to John Kerry's presidential campaign (and $0 to Geo Bush's). And its President, Karen Davis, contributed some $600 to America Coming Together, a liberal advocacy group, as well as $250 to the DNC.

Now, there's absolutely nothing wrong with folks making political contributions as they see fit. But "non-partisan?" Hardly.

Cavalcade #32: Submissions Due

Just a reminder that submissions for next week's CoR are due Monday (the 13th). A big Thank You to Chris Burdick at Insurance Help Hub for stepping in for our regularly scheduled host. Chris asks that you PLEASE include:

■ Your blog's url

■ Your post's url

■ The post's trackback URL (if available)

■ A (brief) summary of the post

You can via Blog Carnival or email.

And we still have Fall '07 hosting slots available. Hosting is fun, easy, and gets you off the "nag" list. Just drop us a line!

Happy Blogiversary, Jay & Louise!

Our esteemed colleagues and blog-buddies at Colorado Health Insurance Insider celebrate their blog's first anniversary today.

In that short time, they've already hosted the Health Wonk Review and the Cavalcade of Risk, and posted countless interesting and insightful articles on health insurance, including their own personal "adventures" in the health care jungle.

Mazel Tov!

Disconnect: AMA & Integrity

In their most recent report on Consumer Driven Health Care, the wise physicans of the American Medical Association concluded that "the overall picture that is emerging dispels concerns that CDHC plans attract only the "healthy and wealthy...CDHC is serving as a catalyst for greater price transparency and public awareness of health care costs."

You'll get no argument from me, of course.

So why, then, are these same health care providers knocking on the burgeoning retail-based clinic model? You know the ones: they're found in Sam's Club & Costco, and in your neighborhood pharmacy. They're convenient and affordable; in fact, since most take no insurance, a lot of expensive overhead goes away altogether. Perhaps best of all, they're models of transparency: prices are prominently displayed, and everyone pays the same.

What's not to love?

Well, that's another post; but the point is, institutions that purport to embrace transparency and accountability (and yes, AMA, I'm talkin' to you), shouldn't then be advocating for "prohibitions against advertising that compares the fees of convenient care clinics with those of physicians."

That's just wrong.

Heath Wonk Review - Overflowing

Overflowing with lots of great posts, that is! Hostess Julie Ferguson, of Workers Comp Insider, presents 16 interesting views on health care policy and financing.

We all know what happens when the fox guards the henhouse, and Jay Norris reports that that's exactly what's been happening with Colorado's efforts to deal with health care financing issues. Ouch.

Consumer Empowerment: Moderation, please

Consumer directed health care -- that is, encouraging the patient to take a more proactive role in health care decisions -- has been a recurring theme here at IB. While there are still some kinks to work out (including more powerful, user-friendly tools), the basic idea remains valid: by giving insureds financial incentives to be more efficient health care consumers, and the resources to make appropriate decisions, the cost of delivering health care (and thus the costs of insurance) will be more easily controlled.

And we stand by that.

On the other hand, too much of a good thing (even consumer empowerment) isn't necessarily helpful:

"Russell Angus just wanted relief from the pain in his groin.

So the 62-year-old St. Paul man asked doctors to remove his testicles. They refused.

He then hired "professionals" to do the surgery for him."

Needless to say, we would encourage more careful management of health care decisions. As Mr Angus might say, "that's no bull."

DC on Rx

There's an old joke about a vaudeville entertainer who, in the middle of his act, drops dead of a heart attack. The emcee comes on to announce that the gentleman has died, at which point a voice calls out from the audience "give him some chicken soup!"

The emcee replies "he's dead, madam, what good could that possibly do?" To which the matron sensibly responds "what harm?"

One might address that same question to the notion that terminally ill patients should have access to experimental treatments, specifically those under review by the FDA (official motto: "We're working on it! Really!"). The argument goes "they're dying anyway, what's the downside?"

Not entirely unreasonable.

But the U.S. Court of Appeals recently gave an equally reasonable response: "their deaths can certainly be hastened by the use of a potentially toxic drug with no proven therapeutic benefit."

Hard to argue with that, either.

From a purely political standpoint, the result was intriguing; it "cut across party lines, with conservative and liberal judges taking both sides of the dispute."

If you're interested, the full text of the decision is here.

Of course, insurance plans typically exclude experimental meds, anyway, but that may be circumvented via a Health Savings Account (part of that "consumer empowerment" mantra, of course).

We do live in interesting times.

Charity Bleg (Minneapolis)

In the aftermath of last week's bridge collapse, tales of miraculous rescues have come to light.

One which caught my eye -- and my heart -- was of Jeremy Hernandez, a young student mechanic who was forced to cut short his own education due to lack of funds. In the meantime, he was working with Waite House, a community resource center. When the bridge collapsed, apparently only feet in front of the school bus in which he (and some 60 children) were riding, Jeremy immediately set about getting those children to safety.

Because of his heroic actions, the technical school he had previously attended has stepped forward, offering Jeremy a "full ride." Fellow blogger Ed Morrissey (who lives in Minneapolis) has suggested that folks can contribute to Dunwoody's scholarship program in Jeremy's name. To that end, the school has even set up a special category on their on-line contribution form.

I'd like to encourage IB readers to help out, too. Our readership was extraordinarily generous in the aftermath of Katrina, let's see what we can do for Minneapolis, and Jeremy. To get the ball rolling, I've donated $36 (the number 18 has special significance in my faith).

How about you?

UPDATE: Received this via email (from Dunwoody): "I am writing to thank you very much for your generous online donation to the Jeremy Hernandez Scholarship Fund. I also am writing to inform you that we have changed the name of the fund from the Jeremy Hernandez Scholarship Fund to a fund entitled BETTER PERFORMANCE OF LIFE’S DUTIES FUND. The reason for establishing a broader scholarship fund is any contribution in direct support of Jeremy Hernandez is not eligible as a tax-deductible contribution."

Frank & Ethel Update (Incredibly Stupid Carrier Tricks)

IB readers may recall our post a few weeks ago, when we reported on the incredibly poor job Anthem had done regarding continuation of coverage, and refund of premiums, following the death of an insured.

I am delighted to report that I just got off the phone with "Ethel," who informed me that she had just been notified by her bank that all the funds had, indeed, been deposited into her account.

We were both quite pleased to be able to put this behind us, and she expressed her gratitude for my efforts on her behalf. Of course, it's my job to advocate for my clients, but I never turn down a warm fuzzy.

Dampening our spirits somewhat is the sad fact that it took Anthem over two weeks to deliver on their promise of a quick resolution and refund.

That's pathetic.

A Sunny Grand Rounds

Dr Hsien-Hsien Lei, blogging at Eye on DNA, hosts this week's beach-themed Grand Rounds. It's not only great looking, it's chock full of interesting posts from around the medblogosphere (yes, I love that term). The good doctor has collected 44 med-related items, all with helpful context.

Malpractice cover gets the once-over by law-blogger Eric Turkewitz, host of the NY Personal Injury Law Blog. Eric busts the myth that rising rates result directly from rising payouts. Interesting stuff.

Happy Blogiversary!

The fine female folks at ChronicBabe are celebrating their second blog anniversary.

If you haven't been there, get set for an irreverent, unique and special look at finances, health, and more.

Mazel Tov, Jenni!

Another Myth: Busted (Medical Bankrutpcy)

As Bob's pointed out (here and here), the idea that significant numbers of folks are going bankrupt from unpaid health care expenses is, to put it nicely, inflated. And today, we have some more "truth to power" as regards the issue.

Professor Todd Zywicki, blogging at The Volokh Conspiracy, recently testified (in front of God, country, and the U S House of Representatives) that "current law adequately accommodates the claims of those debtor laid low by medical problems and expenses and other innocent parties who are affected by bankruptcy including health care professionals and other consumers. Nor is there any evidence that medical bankruptcies are creating any sort of crisis for the bankruptcy system or that the percentage of medical bankruptcies has been rising over time."

He goes on to argue that:

■ There is no evidence that there has been an increase in the frequency or severity of job loss or income interruption as a result of health problems

■ There is little evidence that medical debt is a major causal factor in bankruptcy filings

■ There are no macroeconomic trends in health insurance coverage that would suggest that lack of health insurance could be a major contributing cause to bankruptcy filings

Now, I'm not contending that there are no legitimate examples of folks whose health care expenses have been so great as to imperil their financial solvency.

Of course there are.

But as in so many issues related to health care and how we finance it, a relatively small problem has become magnified to appear as if it's a much larger one.

And that is most definitely not the case.

Bad Info: MIB

A loyal reader forwarded this article to me; in it, the author badly misrepresents both the Medical Information Bureau and the individual medical insurance market:

"An organization called the Medical Information Bureau would take a quick look at their histories and tell 470 companies they are hopelessly bad risks. Their work helps health insurers cherry-pick prospects to cover only those who are unlikely to get sick."

Um, no:

The Medical Information Bureau (MIB) is a clearinghouse that a lot of carriers use to trade information about certain (and explicit) types of risk. Most people who apply for insurance aren't even listed in the MIB's files. And underwriters, while they do refer to MIB records for certain types of cases, use a variety of tools in assessing whether or not to issue coverage (and under what conditions).

We've debunked this sort of thing before (here and here); seems a shame to have to do so again.

But there ya go.

Super Carnival Monday!

First up, the Frugal Law Student presents an astounding 70 posts in this week's Carnival of Personal Finance. Each one touts helpful context, and there are a lot of colorful pics to add visual interest, as well.

My favorite is this post at Journey to Retirement, where the discussion turns to whether or not life insurance on one's children is a good idea. It's a thoughtful piece, with a bit of a twist.

For the first time in a while, one of our posts was included in the Carnival of the Capitalists. This granddaddy of financial/business carnivals is almost 4 years old, and still going strong. Our host this week is Scott Allen of the Linked Intelligence blog. There are over 30 interesting posts, all with helpful comments.

Having recently written on the subject of corporate ethics, I found this article, on ethics checklists for companies to be timely and to the point. Head over to Sox First for the scoop.

Mini-Med Revisited

A while back, we looked at how the market was reacting to the new spate of limited benefit ("mini-med") plans that were popping up. Most of these (at least, all the ones we'd seen to that point) were built on an "individual" chassis; that is, available to individuals or folks in some kind of association or club. They weren't subject to HIPAA laws requiring guaranteed issue or pre-existing condition coverage. Indeed, most of the MM's I've seen have waiting periods of up to one year for pre-existing conditions.

That may be changing:

At least one carrier is now set to market a group-based mini-med, with some pretty significant bells and whistles. For one thing, it's guaranteed issue, and has no waiting period for pre-existing conditions, even maternity. For another, it's available for groups as small as 2 employees, with very liberal participation requirements for larger groups.

So what's not to love?

Well, let's remember that this is still a limited benefit plan, which means that a catastrophic claim is not going to be covered as well (monetarily) as with a "traditional" major medical plan. And because it pays based on pre-determined benefit amounts, an ICU claim (for example) could leave one with some hefty balances.

Still, for folks whose employers don't offer group plans, or for part-timers who may not be eligible, this could be a terrific opportunity.

Oooops! (A P&C Story)

It's one thing to say "Just Like A Good Neighbor," but some folks may take that a bit too literally:

"Yolanda Deharo, three months pregnant, was standing behind the reception desk at Greg Kirk’s State Farm office Tuesday when the maroon Ford Taurus tore through the front wall a few feet away, its front half coming to rest in the reception area."

According to 91 year old Rosa Lee Crow, her brakes failed as she pulled into a shopping plaza to pay her phone bill. She swerved to miss another vehicle, and smashed through the front of Greg Kirk’s State Farm office. Fortunately, no one was injured; hopefully, she had adequate coverage to pay for the damage to both her car and the office.

My guess: Mr Kirk won't be working hard to win her business.

Cavalcade of Risk #31 is up!

Econblogger Jason Shafrin has put together a terrific Cav. He's chosen posts that truly underscore the nature of risk, and presented a streamlined edition.

Do check it out.

And consider hosting your own Cavalcade edition. Just drop us a line for details.