Economy Tanks; Hospitals, Patients Hardest Hit

As we pointed out yesterday, changing the way we finance health care (i.e. insurance) does nothing to solve the problem of providing it; it's akin to rearranging deck chairs on the Titanic. Further proof of this comes to us today from the American Hospital Association:

"Six out of ten hospitals nationally are seeing a greater proportion of patients without insurance coming through their emergency departments ... At the same time, nearly half of hospitals reported they have cut staff."

This from a recent survey undertaken by the aforementioned American Hospital Association (AHA).

Notice that the statement very carefully states "a greater proportion," not a greater number of such patients. So what's the problem? Perhaps this observation, buried further down in the release, offers a clue:

"(M)any hospitals are seeing more patients covered by Medicaid and other public programs for those in need."

Now we see reference to total quantity; in other words, more folks are covered by the gummint, which means at little or no cost to themselves. When something's essentially free, there's a greater demand for it. That's basic economics, which seems to have passed under the radar for so many in our political class.

Lest you think that you're the only one doing major belt-tightening, we learn that "the economy is affecting hospitals with nine in 10 hospitals making cutbacks to help weather the economic storm." Again, I see no indication that they're cutting costs, just expenses. Since we know that health care costs drive health insurance costs, perhaps we're seeing a glimpse of the future. Under a government-run health insurance scheme, everyone gets their coverage "free" (or nearly so), fueling demand, and leading to fewer resources. Fewer resources means more expensive resources, further fanning the financial fire [ed: enough with the alliteration!].

There's another element at work here, as well: the ER is arguably the most expensive room in the hospital (in terms of overall cost for services), yet "(t)he majority of hospitals reported fewer patients are seeking inpatient hospital care or elective care." Again, the wording leaves us wondering if the number of patients overall is shrinking; is it possible that they're simply bypassing the less convenient inpatient services (which require a "reservation") for the more readily accessible ER? The release doesn't say so, but it seems a reasonable inference.

Finally, there's this:

"Many hospitals are struggling to make ends meet with over 40 percent expecting losses in the first quarter of 2009, jeopardizing their mission of caring for their communities."

Again, while it's easy to point at lower reimbursements from insurers, it's important to remember that those reflect reimbursement levels from Medicare. The gummint sets those rates, which hospitals really can't refuse, shifting costs to those with private insurance (or none). Imagine those levels if the state calls the shots for both providing and financing health care.

Ouch!

Health Wonk Review now online!

Health Wonkmeister Robert Laszewski hosts this week's compendium of health care policy and polity. It actually went "live" last evening, proving once again that he's always on top of the latest news and views.

Check it out!

Risk Analysis: Ends and Means vs The Flu

There are (apparently) several high-power drugs available to treat the latest strain. They are all under patent, which means that their production is necessarily limited by the manufacturing capacity of the patent-holders.

Some questions:

■ Should the government order the patents "broken," and the formulae distributed (for lack of a better word) to various other manufacturers (the patent-holders' competitors) in order to increase the speed of production?

■ What, if any, message would that action send to the owners of other IP (Intellectual Property)?

■ Is potentially saving thousands of lives worth that risk?

[Hat Tip: Hugh Hewitt]

Have you Twittered your Entitlements?

[Welcome Industry Radar readers!]

When was the last time you Twittered your entitlements? Has it been that long? Oh, my.

Now you can Twitter to your heart's content about all government handouts you may be missing.

Visit GovBenefits.gov and put your tax dollars to work! Connect with 1,000+ government benefit programs for your family, your job, your home, your health.

Amazing.

It's as if they can't give away our money fast enough already.

Seems I was a bit hasty. Stop me before I Twitter again!!!

Even more Twittering of tax dollars.

(Re)Stating the Obvious: Health Insurance vs Health Care

If you don't ask the right question, you're never going to get the right answer. Similarly, if you don't address the right problem, you're never going to find the right solution.

If health insurance is supposed to pay for health care, then there need to be adequate providers of that health care in the first place. Simply requiring everyone to have health insurance (and requiring insurers to take everyone regardless of health, circumstance or personal choice) does nothing to resolve the underlying shortage of folks who actually deliver the care ostensibly financed.

As Mike pointed out last weekend, "“The bottom line is medical care. But the rhetoric and the talking points are about insurance.”

That seems fairly obvious to most, but then most aren't former college professors or community organizers. And that's exactly the problem with the current administration's grand vision of health care: if there's a shortage (and there is), then how do you provide it to everyone who needs it (you don't).

Which brings us to the real crux of the problem, an ongoing (and increasing) shortage of both specialists and primary care physicans:

"Lawmakers from both parties say the shortage of health care professionals is already having serious consequences. “We don’t have enough doctors in primary care or in any specialty,” said Representative Shelley Berkley, Democrat of Nevada."

One proposed solution is to bump up Medicare reimbursements, but that's met with considerable resistance from the doc's themselves: since it's essentially a zero-sum game, increasing PCP reimbursements would cut into the specialists' income.

And, of course, Medicare itself is slowly, inexorably going broke, which one would think might be a wake-up call (but of course, it hasn't been).

Another proposal (which we've heard before), would be to (somehow) increase the supply of doctors [ed: really? How quickly can we clone them?]. That, too, has met with resistance from, you guessed it, physicians; more doctors means more available care (theoretically), but does nothing to reduce costs.

Quite the conundrum.

So we have a health care system with significant problems, but we're looking at changing the health insurance system to address them. Why does anyone think that makes sense?

Obligatory Swine Flu Post

Since we're often categorized as a "medblog," it seems natural to comment on the "health crisis du jour." While we would never minimize the danger of any potentially catastrophic health problem, I think that we should step back a moment, catch our collective breath, and think this through.

A few years ago, it was bird flu, and SARS before that. While the damage to those individuals who did contract those diseases was, of course, tragic, neither illness became the epidemic/pandemic that was feared.

[ed: let's also clarify some of the terms that have been bandied about recently: a pandemic is a disease that is "prevalent throughout an entire country, continent, or the whole world; epidemic over a large area." An epidemic is one which affects "many persons at the same time, and spreading from person to person in a locality where the disease is not permanently prevalent." Courtesy Dictionary.com]

It appears that, while serious, the swine flu doesn't pose an immediate, existential danger to citizens of our fair country. It's interesting to note that in Mexico, the apparent epicenter of the outbreak, the fatality rate is alarming; here, not so much. Perhaps that's because the Mexican health care system is run by the government.

According to the Centers for Disease Control, "(s)wine flu symptoms are very similar to seasonal influenza and generally include fever, fatigue, lack of appetite and coughing, although some people also develop a runny nose, sore throat, vomiting or diarrhea."

In addition to common-sense prevention methods (such as covering one's nose and mouth, washing hands frequently and the like), the CDC recommends staying away from those who may be infected (coughing, sneezing and the like) and staying home if one has symptoms.

To quote Sergeant Esterhaus: "Hey, let's be careful out there."

D'Oh! Who Didn't See THIS Coming?

[Welcome Derek's Twitter readers!]

According to NPR, " (s)ome people can't buy health insurance because they have a pre-existing medical condition. But for most of the nation's 47 million uninsured, cost is the big obstacle — especially if they don't work for a company that pays part of the premium." No argument, but hardly news: we've been pointing this out for over 4 years.

But something else we've been singing from the rooftops (metaphorically, of course) is that most folks don't have any real clue how much insurance should cost, and balk at the high price when they finally bother to get a quote (usually for coverage they don't even need). As NPR reports, "even if they could find an affordable health plan, many are not used to building that cost into their monthly budget."

No kidding.

Of course, many (most?) of these folks have no trouble building their budgets around cell phones and web access, not to mention cable. As the political class contemplates requiring everyone to be covered, the dirty little secret is that most of these folks are completely unaware of how much such coverage will cost. Again from NPR:

"Two out of three uninsured Americans say they'd be willing to pay no more than $100 a month for coverage. But, according to the Kaiser Family Foundation, the average individual health plan costs about $400 a month, and a family policy costs more than $1,000."

Three things jump out at me from this:

First the wording is quite curious: "two out of three uninsured Americans..." Is NPR finally admitting that a huge swath of the uninsured are not, in fact, "Americans" at all, but indeed are illegal immigrants? We've made that point numerous times; is it possible that the wonks at NPR are secret IB readers?

Second, it's nice that uninsured folks are willing to pony up "$100 a month for coverage." On the one hand, if they're talking about individuals, that may well be "doable" through the use of High Deductibe Health Plans and perhaps a rollback of some of those expensive mandated benefits. If they're talking about $100 per family, well, rotsa ruck with that. By the way, how much is that digital cable bill each month?

Finally, the folks at Kaiser (quoted in the NPR story) continue to throw out that IB-trounced canard that "a family policy costs more than $1,000." Well sure, if we're talking low deductibles and co-pays for office visits, But if we could just get our fellow citizens to understand that health care costs drive health insurance costs, perhaps they'd cut back on the cigs and Big Macs, and the low deductibles and co-pays that encourage over-utilization (and thus drive up costs).

D'Oh!

[Hat Tip: Holly Robinson]

Yummy Grand Rounds

Kerri at Six Until Me hosts this week's round up of great medblog posts. Stop into her GR Cafe and grab some food for thought.

COBRA/ARRA: Ohio Update [UPDATED]

[Please scroll down for important update. HGS]

The good news is that we continue to see clarifications regarding how this massive new entitlement will be implemented. The bad news is that we continue to receive clarifications regarding how this massive new entitlement will be implemented.

Case in point: Ohio's "mini-COBRA" law.

Until a few weeks ago, the threshold for whether or not one would qualify under Ohio's (existing) insurance continuation law was simple: if you qualified for unemployment compensation and had been previously covered for 3 months, you're golden. The main sticking point was always that "eligible for unemployment" wording: the only way for one to know for certain was to apply and await a decision. If you passed, you were entitled to stay on the previous plan for up to 6 months (albeit completely on your own dime).

That's all changed now. The new regs, signed into law on April 1 (how appropriate), lift that key qualifier. Now, that threshold is simply that one has been involuntarily terminated (except for "gross misconduct"), and the continuation has been extended to 12 months (to more closely align with "regular" COBRA/ARRA).

And, of course, the insurer is responsible for forwarding the 65% subsidy. Contrary to popular belief, by the way, the insurer isn't really "paying" anything; they're simply rerouting dollars, which they'll recoup quickly enough at the next renewal. Something about a "free lunch."

We all caught up yet?

ADDENDUM/UPDATE (4-28-09): FoIB Don Deaton points out that since the new law was signed (and took effect) on April first, employees of groups that haven't renewed "until (April 2, 2009) will still only get 6 months of continuation, and ... will still have to be eligible for unemployment to get the coverage at all." The law specifically states that "policies issued, delivered or renewed after April 1, 2009, must include" the new language.

Play Some (Virtual) Golf, Help Some (Very Real) Kids

Chris Heydt, Senior Account Executive at Ogilvy Public Relations, clues us into a wonderful program sponsored by Zurich Life. According to Chris, "(f)or the past five years the Zurich Classic Golf Tournament has been raising money for children’s charities ... there was an opportunity to do a little bit more for organizations who may be in even more need of support than usual ... Zurich is contributing up to $95,000 to two kids’ charities - Fore!Kids Foundation and Practical Action based on participation in a fun online golf relay game."

So here's your opportunity to turn a diversion into a worthwhile effort. Playing is easy: just click over to the HelpPoint website, create a golfer (can I have Natalie Gulbis?), and tee off to send a message of hope. Based on the number of tee-offs (tees-off?) Zurich will donate money to these charities.

It's free, it's fun, what're you waiting for?

Viagra Rub

Can't swallow pills?

Not a problem.

Scientists at the Albert Einstein College of Medicine have been testing a Viagra rub on mice.

Of the seven rats treated by the Albert Einstein College of Medicine in New York, five showed signs of arousal, according to results presented to the American Urological Association (AUA).

The new treatment would likely have fewer side effects than Viagra, which is taken orally and been shown to cause headaches and facial flushing.

Researchers also believe that the nanoparticle therapy could work much more quickly than Pfizer's market-leading drug, which takes up to an hour to kick in.

Good to know.

Life Insurance as ATM: Deconstructing the Myth

Full disclosure: I have not read the book that purportedly promulgates this myth, but was tipped to it by FoIB Wenchy. So I won't take the author to task, but merely use her premise as a "jumping off point" to discuss how the concept is so deeply flawed.

First, though, let's review how permanent life insurance works, and why it can be such a useful tool. Insurance is about risk, and life insurance is a particularly good example of why that's important. Life insurance is based on the premise that death is a certainty; the only question is when (and, in some cases, how, but that's another post). Notwithstanding the very useful LifeSpan widget we've previously discussed, no one but the guy on death row really knows when he's going to die (and he's not a particularly attractive prospect for most carriers). Since we don't know when, we buy permanent insurance as a tool to minimize the financial risk to our families.

To do this, permanent plans cost more than they need to in the early years, as a way to sock away reserves that keeps the plan affordable as we age. These "cash values" are comparable to the equity one builds in one's home, and can be used as a sort of savings account that can be accessed should the need arise. And just as one's house is the collateral for a home equity loan, the death benefit of the policy is the collateral for the policy loan.

Pretty simple, really.

Life insurance policies are rarely good "investments," however, and should never be confused with such. While the cash value builds on a tax-deferred basis, and can be accessed on a tax-advantaged one, they're really not cost effective as ATM's. For one thing, interest is charged on these loans; left unpaid, this can snowball, and even cause the policy to collapse.

For another, if one dies with a substantial loan against the policy, funds that had been counted on to help the family are unavailable at a time that they may be most needed.

But perhaps the benefits of the plan outweigh the drawbacks:

"Here's the plan: you get a whole life insurance policy with a PUA rider (Paid-Up Additions) and invest (in yourself basically) up to the MEC limit. These investments will return dividends, which you reinvest in the policy. Now when you get to the MEC limit (during the capitalization period of about 5-6 years), you can take out loans on your policy (interest on which is tax deductible) and pay (yourself) back over time."

First, the most essential thing to determine when buying a policy - any policy - is how much one needs. Simply buying a policy for use as a potential cash cow is dangerous, and I would also characterize an agent who sells this way as ethically-challenged.

Second, it presupposes that one can find (and afford) a "participating" policy (one which pays dividends). These are not bad policies per se, but they can be more expensive than non-par plans, particularly Universal Life policies (which have their own issues, as well). And, of course, that one can afford to maintain the premiums on such a plan; as we'll see in a moment, letting the policy lapse (or "be foreclosed" to continue our homeownership analogy) can have serious tax consequences.

Third, dividends are not guaranteed; relying on them can lead to disastrous results. If they're lowered, or suspended in a given year (or years), the whole concept collapses. Skeptical? Ask a (former) Crown Life insured.

Fourth, by definition one cannot "reinvest" in a participating whole life policy, because there is no "investment" to be made. Lest readers think I'm parsing, be aware that policies which have investment-like components (called "Variable Life") are heavily regulated by federal and not just state agencies. They require special licenses and documentation, and more closely follow "the market" than the participating whole life plans suggested by the reviewer.

Fifth, interest on life insurance loans is not tax deductible, and hasn't been for many years. So any potential tax savings touted are nonexistent.

Lastly, let's talk about this "paying yourself back over time" nonsense. You're not paying yourself back: you're re-paying the insurer, which holds the death benefit as collateral. If one were to falter in that planned repayment, the possibility that the policy will lapse increases. If one doesn't need the plan anymore, then the loss of the potential death benefit is not a problem. But if one has borrowed out more than one has paid in (a very real possibility with a plan that's been in force for a while), and subsequently lapses the policy, the gain is fully taxable.

Kind of shoots the ol' ATM in the foot, doesn't it?

The bottom line is: this is a very bad idea. As I mentioned above, there are some really great reasons to own permanent insurance (I own three such plans, of varying design), but the idea that one can effectively use any one of them in this manner is at best silly, and at worst dangerous. Unfortunately, by the time one learns this the hard way, it may well be too late.

This Week's Carnival of Personal Finance now online...

Make your "Way" over to Fire Finance's place for this week's link-fest of all things finance.

Medical insurance or medical care?

Here is an interesting point of view:

“The bottom line is medical care. But the rhetoric and the talking points are about insurance.”

Isn't that the truth? But happily, more and more people are beginning to grasp this simple fact with all its profound implications - as well as the adverse implications for failure to acknowledge the fundamental difference between medical insurance and medical care.

You'll be glad if you read it all - because reading Dr. Sowell is always SO refreshing!

COBRA Crunch

Finding affordable health insurance in Georgia is relatively easy for most folks. When you adopt a bare bones approach and only pay for coverage you actually need most people are surprised to see how much money they have wasted in the past and how much they can save going forward.

But when you are out of work and without a paycheck, even the employer subsidized COBRA premium can be beyond reach.

Danna Walker of Humble, Texas lost her job at DHL and along with it her health insurance. The bi-weekly unemployment check of $688 is not enough to cover the family's COBRA premium of $1360 ($467 after the COBRA subsidy).

Like many others, the Walkers live on a knife's edge of risk. Without insurance to cover her high blood pressure or his diabetes, they defer doctors' visits when possible and obtain their prescriptions - nine between the two of them - for $4 apiece at Wal-Mart.

But their primary concern has been finding insurance for Jake, who, after four operations, two stem cell transplants and round after grueling round of chemotherapy, has been cancer-free for a year.

He continues to face a significant threat of recurrence and requires regular monitoring for at least two years. His twice-a-year CT scans cost $3,000 each, and quarterly blood tests and X-rays run more than $1,000.

When you lose your job and COBRA is an option, each family member has COBRA rights independent of the other. It is rare that all family members would face insurability options, and when possible, the healthy ones should be separated from those who need coverage from the group insurance plan.

Other things, such as asking your doctor to change medication to something less expensive such as generics or older brand names is a good start. But the COBRA subsidy will run out in 9 months (some times sooner, depending on the size of the group) and COBRA will expire as an option after 18 months. Most states have risk pools and all have provisions for HIPAA eligible individuals to continue their coverage.

Late last month, in a race against the clock, the Walkers obtained a short-term policy for Jake through Oklahoma State University, where he is a junior studying animal science on a scholarship. Doing so could be crucial to his future insurability because federal law allows insurers to deny coverage for pre-existing conditions when there has been a gap in coverage of at least 63 days.

That may or may not have been the right thing to do. Some states do not recognize STM (short term medical insurance) plans as creditable coverage and not all STM plans meet the criteria of creditable coverage. Many of the plans offered through universities are little more than a mini-med health plan with limited benefits and will not preserve their HIPAA rights.

Our health care Resource (Patient Charity) page is a popular starting point for those who are unemployed or uninsured. People can find taxpayer subsidized health care programs along with a number of charitable organizations that provide assistance.

When Danna was employed at DHL she paid $426 per month for health insurance, DHL paid the rest. Their coverage with Cigna covered roughly $2,000,000 for the cost of Jake's cancer treatment.

Cancer is not just an old person's disease. Jake is only 21.

Roughly 35 states have a high risk pool for uninsurables. (Sadly, Georgia is not one of them). The Texas risk pool wants $414 for a $1,000 deductible plan to cover Jake but the Walker's say they can't afford it.

Even with help all around it is not enough when you cannot find work. The ripple effect of the housing meltdown created by government intervention in the free market is still claiming new victims. So where are those 6,000,000 jobs that would be saved or created with taxpayer "stimulus" money?

Apparently not in Humble, Texas.

Most folks who are out of work can find affordable health insurance. We get calls almost daily from people looking for solutions and most of the time we are able to find a solid plan at a price that fit's their budget.

Cancer Without the Lump

[Welcome New York Times readers!]

Laura Vickers of Sandy Springs has cancer. Not just any cancer, but a rare form of breast cancer called IBC (Inflammatory Breast Cancer).

IBC accounts for 1 - 5% of all breast cancer cases and the survival rate is lower than for other forms of breast cancer.



You can follow Laura Vickers story on her blog. More information on IBC can be found at IBC Research, the Mayo Clinic, and the American Cancer Society.

COBRA/ARRA Update: No Kidding? We Called It

This morning's McPaper had this headline in its Money section:

Health insurance subsidy for laid-off workers has holes

The paper describes several scenarios under which laid off employees may fail the AEI (Assistance Eligible Individual) test:

• Their former employer has gone out of business.

As we noted earlier this week, "COBRA allows one to continue coverage even after one has left an employer. If that employer subsequently goes bankrupt ... the insurance goes away; there is nothing to "continue."

• They worked for a small company and live in a state that doesn't provide extended COBRA coverage

So-called "mini-COBRA" laws extend many of the COBRA requirements to employers with fewer than 20 employees, as we reported almost two months ago.

Unfortunately, this is one case where we're not particularly pleased to be right; a lot of folks have learned the hard way that government largesse often comes with major strings attached.

ADDENDUM: Okay, so you're not eligible for COBRA, let alone the subsidy. What options are available?

Well, that depends largely on your health. If you're in decent shape, not taking a lot of medications, individual medical plans are a great deal. For one thing, you can customize the plan to fit your own needs (unlike "one size fits all" group plans). For another, rates for these plans are often lower than comparable group policies. Your first step should be to consult with a professional, independent agent who specializes in this kind of insurance.

If you're in California, that means someone like Bill Halper; if you're in Georgia, look up Bob Vineyard. The key is to find someone who can help you explore all the alternatives.

But what if you're on a limited budget, especially after being laid off? Or perhaps you have major health issues? Then you need to click on over to Coverage4All, an online resource that helps you find low-cost, even free health care options.

It doesn't have to be the end of the world; it just takes a little time and effort to find the right solution.

From the Mailbag: Painful Mandates

As we've repeatedly shown, adding mandated benefits to health plans increases premiums for everyone, while rarely addressing underlying costs. Touted by special interest groups, it's sometimes difficult for politicians to say "no." And insurance companies make attractive targets: easily portrayed as "the bad guys," one almost imagines carrier CEOs twirling handlebar mustaches while grinning at how they've once again shortchanged their clients.

Which is why an email we recently received from For Grace is so disturbing and disingenuous:

"Chronic pain attacks 76.2 million Americans each day. When those people visit their physician in search of medicine or treatments to help alleviate their suffering, many find their health plans prevent them from getting the prescriptions their doctors have deemed best to treat their condition. Some of the ways this is done include little known practices such as “step therapy,” “fail first” and “therapeutic switching.”

For Grace is a nonprofit advocacy group which claims to be "devoted to ensuring the ethical and equal treatment of all women in pain." While that sounds noble, their email betrays a rather twisted portrayal of how the system really works.

For starters, insurance companies have no power to dictate to providers how they treat their patients, nor can carriers prohibit their insureds "from getting the prescriptions their doctors have deemed best." Insurance companies have the power only to decide how much (if any) they will pay toward the cost of those treatments.

And then there's the snide reference to "step therapy." As defined in the email, this technique is "designed to lower costs and ostensibly provide higher-quality care. The policies are also called "fail first" policies by some, since the drugs must fail to help the patient before the patient receives coverage for a different option." And that's fairly accurate. But the email goes on to tout a bill in the California legislature that would prohibit insurers from overriding a doctor's prescription. The Golden State's legislators really ought to consult with their counterparts in Georgia, Florida, and Alabama, since those states want to do exactly that.

And it's interesting that For Grace isn't training its sights on CMS, since Medicare does the exact same thing. Under Part D, one must go through a lengthy appeals process to overturn that agency's step therapy requirements. Perhaps the folks at For Grace know that it's far easier to fight an insurer than The Feds.

The real issue, however, is whether or not step therapy is effective at both controlling costs and obtaining desired health outcomes. I asked one of our industry insiders to help educate our readers in why step therapy is often successful. He was kind enough to give us a brief tutorial as to why outlawing it would be a bad idea:

"Step therapy is a program where certain prescriptions will only be covered if a prior series of medications or treatments have been tried first. I cannot speak to other carriers, but we have a very limited step-therapy program. I would assume that other carriers programs mirror ours. As outlined by the doctor mentioned, it is usually the higher cost drugs or lifestyle drugs. That is not the whole picture, however, as effectiveness is also a key driver. Take Nexium for example. It was removed from our formulary not just because the cost was prohibitive, but because there were other PPIs that were more effective."

So in this case, a medication that was both more expensive and less effective was relegated to a non-preferred status. Does that mean that an insured is forbidden to buy and take it? Of course not, but that insured will pay more out of his own pocket for the privilege, which saves money for the carrier, and thus all the other insureds. Why would this be a bad thing?

And what about the argument that carriers only do this to avoid paying for more expensive meds?

"Step is a combination of effectiveness and cost control, and both of those pieces need to be in place in order for the program to be successful. If only the cheap drugs are used without an eye for effectiveness, we could see an increase in negative outcomes that have a higher treatment cost on the backend."

In other words, carriers recognize that cheaper isn't always less expensive in the long run.

For Grace is concerned about pain meds, but the same arguments would apply to any other class of drug. Whether it's Nexium, or Lipitor or steroids, it's important to remember that just because something costs more doesn't mean that it's more effective or desirable. And certainly, requiring carriers (not to mention Medicare) to avoid looking at "the big picture" increases costs for all of us.

I'll Drink to That! (Or Maybe Not)

Here's a loaded question: "Can You Drink Your Way to Sobriety?" The surprising answer is: Maybe.

The reason that such a non-committal answer is surprising is that simple common sense would dictate that the answer be "no way." Yet it's the premise behind a new treatment protocol being touted by Dr Roy Eskapa (Ph.D).

According to Dr Eskapa, there's a drug called naltrexone which apparently represses the opioid receptors in one's brain (these are what enable us to "feel high"). According to proponents of this method, if those receptors don't fire, "the addictive behavior ceases, and the problem drinker therefore loses interest in liquor."

That may be good news for alcoholics (or those predisposed toward alcoholism).

The "catch" is that, for the therapy to be be effective, the patient must continue to imbibe (if only for a while). That seems to me to be a rather sticky conundrum: isn't that going to continue to cause liver damage, for example? And then there's the insurance issue: is this going to be a covered expense?

That, of course, depends on what one's policy says. Unfortunately, most plans exclude expenses for things like smoking-cessation programs; it seems to me that this is akin to such regimens. And the cost can be prohibitive: the injectable form (which is apparently more attractive than the oral version) can run $700 a pop. The article says "(m)any health insurance plans pay for the injections," but I found no evidence cited to support this; it seems unlikely that this is the case. Perhaps IB readers with experience in this area could enlighten us?

Although this seems a promising avenue for treatment of this illness, it seems to me to be like the elusive "magic pill" that instantly helps one lose weight with no side effects or effort. I'll give the last word to Dr Harold C. Urschel III (M.D.). Dr Urschel, who helps run a well-known Dallas addiction treatment center, observes:

"It would be nice if all you needed was one pill ... But alcoholism is not just uncontrolled drinking. It's a chronic medical disease and needs to be addressed in a multifaceted fashion."

Cavalcade of Risk #76 is up!

This week's collection of risky posts is hosted at Super Saver 's blog. Super's organized his edition around five general categories, which makes it quite user-friendly.

Couch Potato's Cause Global Warming

We like to stay on top of the news, and we know our readers probably missed this, so here goes.

Global warming is not caused by cars, factories or aerosol cans. It is caused by fat people.

"Moving about in a heavy body is like driving in a gas guzzler."

Each fat person is said to be responsible for emitting a tonne more of climate-warming carbon dioxide per year than a thin one.

Define thin.

The scientists say providing extra grub for them to guzzle adds to carbon emissions that heat up the world, melting polar ice caps, raising sea levels and killing rain forests.

Sounds like the making of a good Randy Newman song. "Fat people got more body to love . . ."

A staggering 40 per cent of Americans are obese, among 300 million worldwide.

Obesity also contributes to almost two thirds of illness that could be prevented.

Grand Rounds is up...

Amy at Diabetes Mine hosts this week's Birthday Bash edition of Grand Rounds. Hey, it's worth stopping by just for the cupcakes!

COBRA/ARRA: Misinformation Abounds

[Welcome New York Times and Industry Radar readers!]

Had a call today from a prospect looking for information on COBRA/ARRA, specifically how she could access the gummint's subsidy. It seems that until recently, she worked at a large national retailer which had shuttered its doors. She was under the impression that she could still elect COBRA (this was understandable, since she had already received the required paperwork for continuation). Unfortunately, the company folded before she could complete, let alone return, the forms.

In the event, it wouldn't have mattered had she been able to do so, since that option evaporated with the company:

COBRA allows one to continue coverage even after one has left an employer. If that employer subsequently goes bankrupt (completely, not a reorganization plan), the insurance goes away; there is nothing to "continue."

[ed: Some states require carriers to offer "conversion plans" in certain circumstances, but that wasn't the case here]

If there's nothing to continue, there's nothing to "subsidize." Indeed, since the company no longer exists, it's not possible for it to pay the 65% at issue. Being a persistent sort, my caller opined that this was okay, she'd opt for an individual medical plan, "since the government's subsidizing it anyway."

Once again, I had to explain that this was not the case (and it's truly disturbing how much misinformation abounds out there): the government never directly paid the subsidy anyway, and there was no provision for any subsidy for non-group plans [ed: Hush up - don't give 'em any ideas!].

In short, if your (previous) employer goes belly-up, so does your COBRA-based health insurance. By the way, this can also happen if the employer simply decides to cancel the group plan altogether (although, in that case, a conversion plan may be available). This is especially problematic for folks with chronic and/or severe pre-existing conditions.

This is just one more reason why I generally suggest to folks that they get off of COBRA as quickly as possible. If you're not on it, it can't bite you.

"Compassionate" Gummint Care

"Whomever pays the piper calls the tune" goes the (once-popular) adage. And that makes a certain amount of sense: if, for example, the government is paying for one's health care (which, of course, it's not; the taxpayer foots the bill), then the government has a stake in both the cost and outcome of that care.

I don't much disagree with that.

But that then begs the question of whether or not we should have the choice of opting out of such a system. As we've seen, when the gummint controls health care (and the funding thereof), it gets to "call the tune" in ways that folks may not have envisioned. Which brings us to the point of all these questions: if the gummint runs the health care system, does that mean it gets to override the advice and concerns of one's own physician?

It appears that it may, in fact, mean just that:

"Because of strokes she suffered while in her mother's womb, 13-year-old Callie Moore of Danielsville has a host of complex medical problems. ... Callie's condition mandates round-the-clock care and treatment. Under federal and state Medicaid regulations and policies, she is entitled to screening, diagnostic and treatment services and, because she is medically fragile, skilled nursing care ... Callie's doctor prescribed 94 hours a week of nursing services, but state officials unilaterally reduced the hours to 84 in 2006."

Now it's important to remember that the state didn't (and thus far, can't) prohibit Callie from receiving the extra 10 hours, but it can certainly refuse to pay for them. And so it has. Since I'm not a doctor (nor do I play one on TV), I won't pass judgment on whether or not the disputed 10 hours are "medically necessary;" but certainly when the state deems them not to be, it's very difficult to "fight city hall."

Now, astute readers may observe that insurance carriers also have a say in whether or not the cost of care will be reimbursed. And that's true: if you've ever filed a claim, you know that the insurer will "reprice" it based on the rates they've previously negotiated with the provider. And sometimes, they'll deny a claim (or pay a reduced amount) based on medical necessity.

But there are some important distinctions: first, the contract itself is agreed to by the parties (the insurer and the insured), they are subject to several appeals processes, and, ultimately, the insurer may be sued by the insured or even fined by the state.

Meanwhile, one can shop around for a different carrier.

There are, in short, choices.

A gummint-sponsored plan, however, offers few of these safeguards, and no choices. The plans are not flexible, one doesn't get to see a policy, and the insured has two choices: abide by the decisions or forego the coverage. An insurer may well have "deep pockets," but they don't have bottomless ones. Not so with the state, which has powers far beyond those of mere insurers.

Callie's parents fought the decision in court, and won. Instead of abiding by the decision, however, three states are fighting it:

"In March, Georgia, Florida, and Alabama joined in an appeal of a 2008 U.S. District Court ruling that a patient’s physician was better positioned – and better qualified – to make decisions about that patient’s medical treatment than state bureaucrats."

Again, readers may argue that insurers make these kinds of decisions, as well, and they'd be correct. But insurers employ legions of medical folks, from CMO's to on-call nurses, to help make them. The state doesn't. There's no question that insurers make bone-headed decisions (one has only to read our on-going Stupid Carrier Tricks series for proof of that); but they are usually held to account for them, and the state has the power to change those decisions, and to enforce those changes.

But who enforces the enforcers?

If the state is the sole source of medical insurance, let alone the sole source of medical care, then who or what has the means to hold those bureaucrats' feet to the fire? That's the danger of socialized, government-run health care, and little Callie may indeed be the poster child for refusing it.

ADDENDUM: In further proof of gummint-run healthcare's tepid sense of "compassion," there's this (from the Files of the MVNHS©):

"Health Service paramedics have been told not to resuscitate terminally-ill patients who register on a controversial new database to say they want to die."

Granted, this is at least a kind of "choice," but is it really the kind of change we really want?

ADDENDUM THE SECOND: Straight from the source, an important warning about the dangers of nationalized health care:

[Hat Tip: Elizabeth Terrell]

Carnival of Personal Finance is up...

Hosted this week at the Mighty Bargain Hunter blog, the Carnival of Personal Finance is a weekly collection of interesting finance-related posts from around the blogosphere.

Health Insurance Monopoly?

Is there a monopoly on health insurance? Some people seem to think so.



Government alternatives already exist for most people. Medicare for the elderly and disabled, Medicaid for the poor, SCHIP for children and most states have risk pools for those who have severe health issues. All of these programs are free (to the beneficiary) or highly subsidized by taxpayer dollars.

More government intrusion is in play now thanks to the ARRA amendment to COBRA. Employers are now required to subsidize 65% of the cost of COBRA for terminated employees. This subsidy can last for up to 9 months and creates and undue financial strain on companies feeling the pinch of a government induced recession.

So why do we need a government monopoly on health insurance? Think Fannie Med.

If you think health insurance is expensive now, just wait until the government takes charge. Trillion dollar deficits passed on to your children and grandchildren will become common place.

Just another stupid government trick.

Cavalcade of Risk #76: Call for Submissions

SuperSaver hosts next week's Cavalcade of Risk. Submissions are due by Monday the 20th, and Cav goes live on the 22nd. SuperSaver asks that you include:

■ Your blog's url
■ Your post's url
■ The post's trackback URL (if available)
■ A (brief) summary of the post

And PLEASE remember: ONLY posts that relate to risk (not personal finance tips and the like).

You can submit your post via Blog Carnival or email.

COBRA/ARRA: The State Fair Edition

Previously, we noted that some states have so-called "mini-COBRA" laws which apply to smaller groups (under 20 employees). There was some confusion as to how COBRA/ARRA would apply in these situations, which has now been cleared up a bit, thanks to (no kidding!) Anthem.

Readers may recall that the new "regular" COBRA rules require the employer to bear the cost of the employees' subsidy; the rules for "mini-COBRA" differ in that they require the carrier to, um, carry those costs, and then (hopefully) recoup them through their own payroll tax filings.

While one may enjoy the "schadenfreude" of the carrier being put in the position of premium payer, it would be well to remember that these costs are actually borne by their insureds (that would be thee and me). Something about the Law of Unintended Consequences.

And, of course, these folks will be eligible for the subsidy effective last September (some 7 months ago). That could end up being a nice chunk of change coming out of carriers' coffers.

And ultimately, our wallets.

From the P&C Files: Insuring Piracy?

While hunting for relevant Cavalcade of Risk posts (something I do to help out hosts), I ran across this fascinating article on K&R (kidnap and ransom) insurance:

"... it doesn't take much imagination to see that kidnap and ransom insurance feeds a flourishing worldwide enterprise in criminal activity. It's the insurance equivalent of derivatives in the securities trading market. There's no stated law against it, so it must be okay."

Provocative, yes, but oddly compelling. Recommended.

Health Wonk Review: Health Care Carousel of Progress! is up...

Pizaazz blog's Glenn Laffel makes his HWR debut, presenting an outstanding roundup of all that's wonky in the healthcare side of the 'web. From poetry and an epic escalator fail, to posts on "Big Insurance" and Google Health, you're sure to find something to whet your appetite for info.

Not Your Mother's Tea Party

Hard as it may be to believe, I have never before participated in an organized protest.

Ever.

So this afternoon proved a watershed event for me, as I mingled with thousands of fellow citizens in the brisk ( but dry!) Dayton weather. Because this was such a seminal moment for me, I'd like to share some of my thoughts and observations about my experience, while avoiding some of the more obvious politics [ed: rotsa ruck with that].

As I mentioned, I've never been to a protest before, so I really didn't know what to expect or even the appropriate time to arrive. The event was planned to officially kick off at 6:00, and I was concerned about parking (a perennial problem in our fair city). So I got downtown about 4:00, and turned into the first parking garage I saw; this was about three blocks from Courthouse Square.

As predicted, the walk didn't kill me.

When I arrived at the designated site, I found about a dozen or so other folks milling about. Several of us introduced ourselves, noting that this was our first protest (this later turned out to be a common theme). Gradually, the crowd grew, until about 5:30, when I looked around again - really looked around - and realized that there were many hundreds of people around me. I have no idea how many folks attended; the rumor was three thousand, perhaps more. Regardless, it was a lot of people.

Something else I noticed: there was a good mix of ages, with a lot of grandparents (or, at least, folks old enough to be grandparents). I found this intriguing. And it was a well-behaved crowd: folks helped each other up and down steps, that kind of thing. I was pleased that the event began with both the Pledge of Allegiance and the National Anthem.

And the signs!

I saw literally hundreds of home made signs, and a mere sprinkling of professionally manufactured ones. Make of that what you will, but I was heartened by this.

This was billed as a non-partisan event, and for the most part, it was. That is, it was not a matter of Democrat vs Republican, but it was not a non-ideological event, in that it appealed more to conservative than liberal values. Unfortunately, a lot of folks (judging by their signs) mistook Obama's recent efforts as the sole cause of our current situation. He is not: Republicans, including former President Bush, were complicit in much of what we now face.

One common chant was "Fire Them All," meaning all members of Congress, regardless of party affiliation. While I understand the sentiment, it is - let me find the right word - oh yes: stupid. Notwithstanding the legal and constitutional issues of such an idea, it fails to recognize that there are folks in both Houses, and on both sides of the aisle, who have fought against wasteful spending.

Another common sign was "Read The Bill!" Indeed, several of the speakers chastised members of congress for passing Spendulus without even reading it. This is also stupid: does anyone really think that if they'd read it, they wouldn't have passed it? Wishful thinking.

And of course, there were signs and speakers using the event to tout the Fair Tax. I have no particular disagreement with the concept of the Fair Tax, but the way it's being promoted is, you guessed it: stupid. The problem is that most people don't have a clear understanding of just how much they currently pay in taxes ("hey, I got a refund!"), and so have no particular reason to get all excited about doing away with the current code. The Fair Tax is certainly a reasonable ends, but as a means, it's, well, you know.

So, Henry, what's your solution if you think the Fair Tax "isn't all that?"

It's simple really, and would require only one bill and would cost virtually nothing to implement: merely outlaw all tax withholding. Business owners and entrepreneurs know all about quarterly filing; the average employee is clueless. If there's no withholding, everyone gets 100% of their paycheck, every week (or whatever).

That's the good news.

The bad news is that everyone would then be required to file quarterly taxes. That means writing a potentially sizeable check, every three months. I suspect that after exactly two of those checks go out, we'd see the end of the tax code as it currently exists. Then the Fair Tax may become a viable option.

Okay, back to the Tea Party. With one exception, all of the speakers were "regular folks:" homemakers, business owners, a gentleman who grew up in East Germany who spoke eloquently about this land of opportunity and freedom. The last speaker was a state representative who did a passable job of staying non-partisan. By then, the crowd had started to thin, as folks looked at their watches and headed home for (one supposes) dinner. None of these were professional speakers (save for, obviously, the pol), but they were excited and exciting, and obviously "true believers" in the cause.

As for me, I was there for a much simpler reason: my daughters and their (eventual) children, and their children. It frightens me to think that we're purposefully burdening them with even more debt; a long term, perhaps permanent "solution" to an obviously short term problem.

Will these events make a difference? I really don't know. But for me, it seems necessary that we at least try because if we don't, the alternative is frightful to contemplate.

ADDENDUM: I neglected to mention something else that bothered me about today's rally. The signs and speakers focused primarily on the massive debt and increased taxes, but very little was said (or seen) about the bail-outs or (perhaps more importantly) the government takeover of parts of two major industries: automobile manufacturing and financial institutions (including insurers).

I think that one of the wonderful aspects of this "movement" (for lack of a better term) is its lack of centralized planning or sponsorship; on the other hand, one of the challenges of this movement is its lack of centralized planning. Because it is essentially a grassroots effort, it lacks a coherent and cohesive message. Perhaps that will change as it matures and coalesces, but I think the speakers (at least at the Dayton event) missed an opportunity to spotlight the increased government control of major sectors of our economy, and the dangers that such control represent.

I certainly hope that this is corrected at future such events.

COBRA . . .ARRA . . . Gotcha!

[Welcome Industry Radar readers]

Just when you thought it was safe . . . the land shark is at your door.

So you thought the Porkulus Bill and the ARRA (American Recovery and Redundancy Act) was a good deal for those who opt for COBRA, right? After all, your employer is required to pay 65% of your COBRA premium for up to 9 months so life should be good.

Not so fast Sparky.

By any chance did you have a Flex (FSA) plan in place for your group health insurance? If so, there may be a gotcha.

According to the folks at Conexis, this little goody is buried in the law according to a recent release from your friends at the U.S. Treasury.

COBRA premium reduction is available for any group health plan EXCEPT . . . vision only, dental only, mini-med plans, and . . . those administered under Section 106(c) as part of a flex spending plan. (See the bottom of page 3 and top of page 4 of the linked document).

Having fun?

I knew you were.

UPDATE:

Some have commented and emailed regarding the interpretation (above) of Treasury notice 2009-27, indicating perhaps Conexis missed the mark. Here is a direct quote from that notice.

Q-27. Is the premium reduction available for COBRA continuation coverage under a vision-only or dental-only plan?

A-27. Yes. The premium reduction is available for COBRA continuation coverage of any group health plan, except a flexible spending arrangement (FSA) under section 106(c) offered under a section 125 cafeteria plan. This includes vision-only or dental-only plans and “mini-med plans,” whether or not the employer pays for a portion of the costs for active employees. The premium reduction is not available for continuation coverage offered by employers for non-health benefits that are not subject to COBRA continuation coverage, such as group life insurance.

You be the judge.

DNA vs PAP

Pap smears are a regular health care item for women, and are considered covered expenses under many health plans; indeed, many of the newer HDHP's cover them as first dollar expenses (meaning that most of the cost is borne by the carrier, regardless of whether or not one has met the deductible).

And that's a good thing.

Or is it?

According to a recent NYT article, "(a) new DNA test for the virus that causes cervical cancer does so much better than current methods that some gynecologists hope it will eventually replace the Pap smear ... Not only could the new test for human papillomavirus, or HPV, save lives; scientists say that women over 30 could drop annual Pap smears and instead have the DNA test just once every 3, 5 or even 10 years."

Once a decade? That could represent a significant cost savings, for both insureds and insurers. But is cheaper better?

Maybe so:

Scientists' "optimism is based on an eight-year study of 130,000 women in India financed by the Bill and Melinda Gates Foundation and published ... in The New England Journal of Medicine. It is the first to show that a single screening with the DNA test beats all other methods at preventing advanced cancer and death."

"All other methods." That's significant.

On the other hand, the old adage about the roof that isn't leaking still holds sway:

"But whether the new test is adopted will depend on many factors, including hesitation by gynecologists to abandon Pap smears, which have been remarkably effective. Cervical cancer was a leading cause of death for American women in the 1950s; it now kills fewer than 4,000 a year."

That's a significant reduction on cervical cancer-related deaths; while 4,000 still leaves a lot of sad widowers, parents and children, it's a far cry from a "leading cause of death." So the question is whether the new test can put a significant enough dent on those remaining 4,000 to persuade OBGYN's to abandon the old Pap smear en masse.

Time will tell.

[Hat Tip: Holly Robinson]

More Spendulus Fallout: EMR ASAP

As we've noted noted before, one of the little-publicized "gotcha's" in the Spendulus was this little gem:

"The bill’s health rules will affect “every individual in the United States” (445, 454, 479). Your medical treatments will be tracked electronically by a federal system. Having electronic medical records at your fingertips, easily transferred to a hospital, is beneficial. It will help avoid duplicate tests and errors."

Now, that sounds fairly benign, until one realizes that it's Washington, DC ('dah capital') in charge of processing that information. And by "processing," we mean "selling:"

"The economic stimulus law plans for every American to use an electronic health record (EHR) and allows those records to be sold for research and public-health purposes – without patients' consent," says Sue Blevins, presient of the Institute for Health Freedom.

[ed: the IHF is a not-for-profit, non-partisan think tank founded in 1996]

So-called "data sharing" has been around for a long time, of course (cf: "do not call list"), but this takes on a whole new meaning, perhaps an ominous one. After all, if the gummint is in charge of keeping and disseminating your information to health care providers, it's also able to sell that data to drug manufacturers, employers (and potential employers), anyone it chooses. On the one hand, that's a nice revenue stream (to offset some of Washington's other expenses), but at what cost?

Ms Blevins claims that "her goal is not to be alarmist." But why not? This is an alarming development. No, we're not talking black helicopters and tin-foil berets, but how easy would it be for this information to be abused? Or mishandled, or lost or stolen? The answer is probably "no more than if it was underatken by private industry." And that would be about right.

The problem is "accountability:" when private companies (e.g. credit card issuers, mortgage holders, etc) screw up, they're sued and fined. But one can't (easily) sue the government. And there's the rub: what good are assurances when there's no way to enforce them?

The question now is whether it's too late to derail this particular train.

Unfair Competition

Say you owned a business selling hot dogs on the street corner. Hot dogs are easy to prepare, affordable for most and in high demand (especially at lunch time).

You have run this business for some time, have established clientele for repeat business and even pick up new clients from time to time. Even though there are restaurants nearby, you really have a niche market with almost no competition.

Life is good.

But say a new hot dog vendor shows up one day and parks their cart next to yours. Your hot dogs sell for $2.50. Add a little more for cheese or chili.

The new guy is selling the same hot dog for $1.25 with all the works.

How long will you stay in business?

More importantly, how long will your competitor stick around when his dogs are half the price of yours?

If your competitor has an unfair advantage, such as the ability to draw unlimited cash to fund his business and never have to worry about paying it back then don't expect the competition to go away any time soon.

Now, instead of hot dogs, let's say you sell another high demand product like health insurance. Your product is priced to cover your costs and leave a little left over to provide you with some income.

But now a competitor comes along that doesn't have to play by the same rules. They have the ability to dictate what services are covered, who is entitled to those services, and how much they will pay medical providers for there services. But they have another advantage that you don't. They don't have to play by the same rules as you. They can borrow money at any time and never have to worry about paying it back. Nor do they have to "qualify" for the loan.

How long before your clients stop buying your product when they can get the same thing for half price?

If the new regime in Washington get's their way this might happen. Obama-care will work something like this.

Democrats this year want to institute a "public option" -- an insurance program financed by taxpayers, managed by government and open to everyone, much like Medicare.

Financed by taxpayers. In other words, you will be forced to pay for it whether you want it or not.

This public option will supposedly "compete" with private alternatives. As President Obama likes to put it, those who are happy with the insurance they have now can keep it -- and if they happen to prefer the government offering, well, gee whiz, that's the free market at work.

No one is forcing you to buy the new plan. You have a choice.

When Massachusetts mandated health insurance for everyone and offered a choice of a "free market" plan or a tax subsidized plan, guess what happened?

A couple of things.

Many who had health insurance before dropped it in favor of the free or subsidized plan. After all, why pay for something when you can get it for free?

The other was a squeeze play on primary care. Suddenly, it was easier to get tickets to game 7 of the World Series than to get an appointment with a primary care doctor.

A public program won't compete in a way that any normal business would recognize. As an entitlement, Congress's creation will enjoy potentially unlimited access to the Treasury, without incurring the risks or hedging against losses that private carriers do. As people gravitate to "free" or heavily subsidized care, the inevitably explosive costs will be covered in part with increased outlays to keep premiums artificially low or even offer extra benefits. Lacking such taxpayer cash, private insurance rates will escalate.

Unlimited access to cash without incurring risk.

Sounds great, right?

Except eventually, everyone pays.

Kind of like the mortgage crisis. All of us are now paying for the abuses of a few which were subsidized to a great extent by Fannie & Freddie . . . those quasi-government entities backed by the full faith and credit of the taxpayer.

Much like Medicare, overall spending in the public option will be controlled over time by paying less for medical services, drugs and technology. With its monopsony purchasing power, below-market fees will be dictated on a take-it-or-leave-it basis -- an offer hospitals and physicians won't be able to refuse. Medicare's current reimbursement policies pay hospitals only 71% of private rates, and doctors 81%, according to the Lewin Group.

Right now, hospitals and doctors are not required to accept Medicare patients unless they also receive taxpayer funds. Sound familiar? But there is talk about imposing severe payroll tax penalties on medical providers who do not accept Medicare patients. In other words, government sanctioned extortion.

In a recent analysis, Lewin estimates that enrollment in the public option will reach 131 million people if it is open to everyone and pays Medicare rates. Fully 119 million people will shift out of -- or lose -- private coverage.

If you think Medicare is currently working well, then you don't know Medicare.

About 170 million people currently have private insurance, which is already pressured by the price controls of Medicare and Medicaid. A significant share of government underpayments are simply transferred to the private sector, adding tens of billions of dollars every year to consumer health bills.

That is referred to as cost shifting.

What the government doesn't pay is made up by the rest of us.

We pay more so those on the taxpayer funded government health insurance plan can have their free care. Sweet deal, huh?

But wait.

We, as taxpayers, pay for it any way.

Our taxes fund Medicare and then we pay again because Medicare short changes the medical providers.

What a country.

Pesach and Pascha

Hank celebrates Pesach, or Passover.

We celebrate Pascha, or Easter.

But where do these words come from?

According to some, you can blame it on William Tyndale, the publisher of the first English translation of the Bible. The Tyndale Bible is also known as the King James Bible.

King James I of England ordered the translation of the Bible which was to become the "official" Bible of the Church of England. English translations existed prior to the Tyndale Bible but King James wanted one that would be officially accepted by the Church of England.

The Old Testament was originally translated from Hebrew while the New Testament from Greek. Old Testament documents referred to Pesach which Tyndale translated into a word he coined . . . Passover. Prior to that time the word Passover did not exist.

When Tyndale encountered Pascha in the New Testament Greek, he sought to make a distinction in the traditional Jewish celebration of Pesach (now known as Passover) and the Christian celebration of Pascha. Supposedly he coined the word Easter as a transliteration of a pagan celebration of Ishtar which was held about the same time of the year as Pesach.

Ishtar was a celebration of the new birth of spring, or a new beginning. Similarly, the celebration of Easter is also a new beginning in the Christian faith.

So whether you celebrate Pesach or Pascha, we wish you well.

Mass Revisited

[Welcome Kaiser Network readers!]

It has been a while since we looked at the Massachusetts experiment to provide universal health care, so we decided to take a closer look. We were prompted, at least in part, by the fact that the folks in Washington who think money grows on trees seem to be eyeing the Mass plan as a model of efficiency and something that should spread to the other 49 states.

While the plan may not have driven off the Chappaquiddick bridge . . . yet . . . it is certainly in need of some retooling.

According to Cato (no, not the O.J. house guest):

Massachusetts has significantly reduced the number of people in the state who lack health insurance. However, it has not achieved, nor does it expect to reach, universal coverage. (The best estimates suggest that more than 200,000 state residents remain uninsured). And, significantly, roughly 60 percent of newly insured state residents are receiving subsidized coverage, suggesting that the increase in insurance coverage has more to do with increased subsidies (the state now provides subsidies for those earning up to 300 percent of the poverty level or $66,150 for a family of four) than with the mandate.

The cost of those subsidies in the face of predictably rising health care costs has led to program costs far higher than originally predicted. Spending for the Commonwealth Care subsidized program has doubled, from $630 million in 2007 to an estimated $1.3 billion for 2009.

I have no idea about the standard of living in MA, but $66,150 for a family of four is probably not at poverty levels. The Kaiser Foundation reports the median income for 2005 - 2007 for Mass was $58,286 vs. $49.901 for the country. So you can earn 14% above the state median income and still qualify for taxpayer assisted health insurance.

And let's not overlook the doubling in spending for this program in two years time. Can you say government bailout?

Now the state is turning to a variety of gimmicks to try to hold down costs, including possibly cutting payments to physicians and hospitals by 3-5 percent. However, the (NY) Times quotes health reform experts who have studied the Massachusetts system as warning “the state and federal governments may need to place actual limits on health spending, which could lead to rationing of care.”

Gimmicks.

Good word.

Rationing of health care.

Not a good word.

But what about that NYT reference?

They report the bill to offer universal health care was passed "with Paul Revere speed" and that then Governor Mitt Romney "made an expedient choice, deferring until another day any serious effort to control the state’s runaway health costs."

Deferring issues on cost until another day.

Somehow this sounds very familiar.

The day of reckoning has arrived. Threatened first by rapid early enrollment in its new subsidized insurance program and now by a withering economy, the state’s pioneering overhaul has entered a second, more challenging phase.

Thanks to new taxes and fees imposed last year, the health plan’s jittery finances have stabilized for the moment. But government and industry officials agree that the plan will not be sustainable over the next 5 to 10 years if they do not take significant steps to arrest the growth of health spending.

The plan will not be sustainable.

Then what?

Once entitlements are put in place no politician wants to take them back. When is the last time you heard of government cutting out an entitlement program?

Mass has this great idea for controlling health care costs. They want to change the way docs & hospitals are comped.

They want a new payment method that rewards prevention and the effective control of chronic disease, instead of the current system, which pays according to the quantity of care provided.

Who determines what is "effective control"? Most chronic illness is preventable with lifestyle changes, so why penalize the medical provider for a lack of self discipline on the part of the patient?

Massachusetts has more doctors per capita than any state, Boston is home to some of the country’s most expensive academic medical centers, and a new state law requires comprehensive benefits like prescription drug and mental health coverage.

Mental health parity.

So in the midst of expanding services and a health care budget that doubles every two years they opt to increase benefits.

Mass not only requires all residents to have health insurance or pay a fine ($1,068) but also requires insurance carriers to accept anyone regardless of health.

Think of it like you would a bank that will issue a mortgage to anyone, regardless of credit or their ability to pay back the loan.

In its first full year of operation, Commonwealth Care drew higher enrollment than anticipated, and the state found itself facing an inaugural budget gap. Mr. Patrick and the legislature filled it by assessing insurers and hospitals, raising the penalty on noncompliant businesses, increasing premiums and co-payments for consumers, and raising the state tobacco tax.

Oops!

There was another issue as well, as we reported before. The Big Squeeze means more patients for the doctors.

That's the good news.

The bad news is, longer waits to see the doc.

Let's see. Free or almost free health care. Increased demand. More difficult to see a doc.

Can't figure out why no one saw that coming.

Blue Cross and Blue Shield of Massachusetts, the state’s largest insurer, recently devised an innovative model that pays doctors a flat fee per patient, with adjustments for age, gender and health status, and then adds bonus payments for high standards of care.

Novel. Has some promise. Tracks the HMO model where providers are paid a capitated fee rather than fee for service.

Some health policy experts argue that changes in payment practices will not be enough to slow the growth in spending, even when combined with other cost-cutting strategies. To truly change course, they say, the state and federal governments may need to place actual limits on health spending, which could lead to rationing of care.

“Really controlling costs requires just stopping spending,” said Stuart H. Altman, a professor of health policy at Brandeis University.

Stop spending.

Yeah, that works too.

M*A*S*H Meets Mac

Every once in a while, we're asked to review a product or service. We've reviewed a book, for example, and a ground-breaking excercise in transparency. Recently, I received an email from a company called Healthagen touting a new iPhone app called iTriage.

[ed: I actually own an iPod Touch, which is essentially an iPhone sans camera, microphone and, well, phone.]

I decided to give the app a whirl, and downloaded it from the iTunes store (paying, I might add, full retail; no swag for me!). The purpose of iTriage is to act as a sort of, well, triage unit for helping one decide the nature and severity of one's symptoms, and to help one decide if and where to go for help. The iPhone's built-in GPS and phone capability enable the program to, for example, dial 9-1-1 if appropriate, or find the nearest ER or pharmacy.

To "enable" the software, one must create an account, supplying an email address and zip code, as well as one's insurer. The first two I understand, but why the insurer? And how is this program a "step-up" from, say, WebMD?

Those questions, and a few others, prompted me to seek an interview with one of the program's developers. What I got, though, was perhaps even better: Healthagen's Chief Medical Officer, Dr Wayne Guerra. Dr Guerra, and his business partner Peter Hudson, are both emergency medicine physicians and collectively have taken care of over 50,000 patients. Having watched their patients struggle to make difficult medical decisions with only limited information, and they were motivated to develop iTriage to empower their patients. The point is to narrow the information gap that currently exists by giving patients medical information, transparency around price and quality, and access to healthcare facilities at the point of care [ed: all major themes here at IB]. Users need this information when they are having, for example, abdominal pain, or when they have just injured their ankle. The most useful method of providing this information was with a mobile device. Dr Guerra says that implementing all the features of iTriage was not possible until the iPhone 2.0 OS was released.

For our readers who may not be familiar with the app, I asked how iTriage differs from something like WebMD? After all, many folks have 'net access on their phones, or have other portable computing devices available to access such resources. so what sets iTriage apart?

Dr Guerra replied that "iTriage starts where other content sites like WebMD stop," by providing “actionable data”. This is information that calls for a decision to be made, perhaps whether more information is needed, to ask for advice, or assist in finding a medical facility at which one may obtain medical care.

By way of example, Dr Guerra gave a rather common symptom: abdominal pain: "Let’s say you have lower abdominal pain. You search this symptom and iTriage produces the possible causes. You select appendicitis and read the description, common symptoms, standard work-up and expected treatment. After this information you can decide to use the search the web for more information including images and videos, get advice from a nurse or a doctor, or decide to find an appropriate treatment facility. If you choose to obtain medical care iTriage will only list appropriate healthcare facilities from its proprietary lists of over 6,000 emergency departments, 5,000 urgent care facilities and 1,000 retail clinics. Only an emergency department can treat appendicitis and iTriage will geo-locate the phone and list the closest emergency departments enabling the user to call or get a map to the facility. iTriage helps users select a facility by enabling them to buy a HealthGrades quality report through the phone and by learning about the hospital’s specialty services through text or videos." It even helps with the financial aspect by connecting with the bill negotiation services of Coalition America.

Before one can begin using iTriage, one must create an account. This involves supplying an email address and zip code, and also the name of one's insurer (if applicable). There's no personally identifiable info (save for, perhaps, the email). I was puzzled as to why the app wanted to know the name of my carrier.

According to Dr Guerra, the current version of iTriage "uses the medical insurance information to provide users with the appropriate nurse advice number. In the future, iTriage will be able to recommend treatment facilities based on network data; this will enable users to obtain the most cost effective healthcare solutions."

Finally, I asked what's in store for the future. Cuurently, Dr Guerra, et al are "developing a web based and .mobi version of iTriage, and expect to launch these functions in May of 2009. This implementation will greatly expand the reach of iTriage and enable those without an iPhone to use the services. iTriage has established partnerships with TelaDoc, HealthGrades and Coalition America. Healthagen, the parent company of iTriage is pursuing other partnerships to bring our users more granularity around pricing, and other features that will help them make better medical decisions."

That's certainly something to look forward to.

A warm InsureBlog Thank You to Dr Guerra for his time and participation, and to Alicia Verity for alerting us to the product and helping to arrange the interview with Dr Guerra.

Chag Sameach Pesach!

This evening we begin the weeklong holiday of Passover, one of Judaism's most important Festivals. More than anything else, it represents the value and importance of liberation and freedom.

Not to mention lots of fruit in one's diet.

A Joyous Passover to all of our readers!

Need TARP Money?

[Welcome Industry Radar readers!]

Back the truck up, the TARP vaults are opening again. CNNMoney is reporting that TARP funds may be made available to insurance carriers that are also bank holding firms.

Prudential Financial Inc. (PRU, Fortune 500), Hartford Financial Services Group Inc. (HIG, Fortune 500) and Lincoln National Corp. (LNC, Fortune 500) are said to have applied but the Journal's sources said Treasury has not yet decided which applications will be approved.

My question is, given the threats from Washington regarding anyone who receives federal tax dollars, why would any firm subject themselves to additional governance? Herr Geithner and Uncle Barney along with many of their band of merry men (and women) have already threatened to limit the pay of executives in firms who receive taxpayer money. And if they can't limit pay, or fire those they deem unfit, they will just tax the hell out of the money you receive.

Of the original $700 billion allocated for the financial-sector bailout, roughly $135 billion remains. However, that doesn't mean all of those funds would be made available for eligible insurers

Money left over? Sounds like party time.

Toga! Toga! Toga!

Thanks to Wenchy for the tip . . .

Cavalcade of Risk #75 is up!

Talk about your Risky Business! Host John Leppard presents this week's Cavalcade of Risk, cruisin' right along with an outstanding selection of posts.

Kudos, John!

The "No Insurance Club"

[Welcome Industry Radar and Kaiser Network readers!]

With unemployment in Georgia topping 9%, and at least one county over 20%, many are finding themselves without employer sponsored health insurance. Even with the employer COBRA subsidy, paying for group insurance without a paycheck can be a challenge. If the employer drops the group insurance plan, COBRA goes away as well.

This is not just a Georgia problem. Individuals and families everywhere who have had health insurance that is tied to their jobs fall into a trap of believing they can't afford health care unless they have health insurance.

For most, nothing could be further from the truth.

Routine health care usually is affordable for most, it is the catastrophic care that is a problem. But some medical providers in Kansas City think they have a solution. The Briarcliff Medical Associates have started what they call a "No Insurance Club".

For one person to join the No Insurance Club, it cost $480 for the year.

After you sign the contract, you get 12 doctor visits a year that include services like physicals, blood work and flu shots.

For a family, no matter the size, it will cost you $680 for the year. It includes everything that an individual plan does, but ups the number of doctor visits to 16.

Sounds great, right?

But it has drawbacks and can convey a false sense of security.

The idea originated out of Arizona. A visit to their site indicates the No Insurance Club has a participating provider in Georgia. A single, participating provider.

How about Kansas City?

A single, participating provider.

Arizona has about a dozen.

There are some other gotcha's as well.

How about this. Why prepay for a dozen visits when you may only need 3, or none? We think a better approach is to access places like Take Care Clinics where you pay as you go and only for needed services. Most office visits run $40 - $60 and you pay only for services provided. Plus the Take Care Clinics are offering free health care for those who are unemployed.

But say you join the No Insurance Club and use up your 12 visits. What happens then?

According to their site, you prepay for another 12 visits.

So far this isn't impressive. And apparently they are flying under the radar in the handful of states where it operates. Surprisingly, New York is one of those states with (again) a single participating provider.

Apparently the New York Dept. of Insurance has not yet put the No Insurance Club in their crosshairs. But a similar plan is already under fire for operating an unliscensed, unregulated prepaid medical plan.

Even though the plan appears pricey to me, there is some transference of risk and that is the very essence of insurance. Don't misunderstand. I like the idea of individuals and families paying for their own primary care out of pocket rather than overpaying for phantom insurance.

One thing I learned a long time ago is any insurance plan with the word copay is a bad choice. I constantly remind my clients that Bare Bones health insurance is the way to go if they want to stop overpaying for health insurance.

But how does a No Insurance Club create a false sense of security?

Primary care is not where the big dollars in health care are spent. Roughly 80% of claim dollars go to cover catastrophic health care and almost 20% of those dollars are for prescription drugs.

The No Insurance Club does nothing to address Rx costs or catastrophic coverage.

One thing the No Insurance Club does not cover is a visit to the emergency room or if you are required to stay in the hospital. It also does not cover a specialist.

$480 per year is no bargain when you have a $50,000 claim. (Warning, shameless plug follows). I have quite a few clients who have solid, catastrophic coverage for $500 - $1000 per year in premiums.

Which makes more sense? Paying $480 per year for 12 doctor visits or paying about the same for a plan that will cover office visits, Rx, hospital, surgery, E.R. visits and more up to $5,000,000?

To me, this decision is a no-brainer.

DI PDQ ASAP

Do you know your PDQ? No, not "Pretty Darn Quick:" your Personal Disability Quotient. A few weeks ago, we learned about a new online tool that can help us calculate our life expectancy, which is nice if we're talking about quantity . But it's also important to consider quality of life, and that's where another new tool comes in.

The Council for Diability Awareness has designed a tool for folks to calculate how likely it is for one to become disabled. The PDQ Calculator is pretty easy (and fast) to use, and not particularly intrusive. You're asked about height and weight, age and whether or not you smoke, what kind of work you do, that kind of thing. After you've input that data, the app kicks out your odds of becoming disabled.

If you care to, you can then input some financial info, which allows the program to calculate the dollar amount that's at stake; at no time does it ask for personally identifying information . At the end, you can even print out a report with all the information neatly laid out.
Very cool, and very useful.

"Fannie Med"

Every once in a while an article from another health care blog will cross my desk and it will catch my eye. Richard Scott's post Patient-based Health Reform or "Fannie Med?" at The Health Care Blog really resonated with me.

His insight, as well as his analogy to the mortgage meltdown which was created by government intervention in the free market, is spot on.

He also outlines his reasoning for the conflict between "universal care" and "patient rights" in a way that almost everyone will nod their head in agreement.

Anything that interferes with an individual's freedom to consult their doctor of choice to make health care decisions defeats the purpose of meaningful health care reform.

He further states what he terms the "four pillars" of health care reform as it relates to patient rights.

True health care reform must involve choice, competition, accountability and responsibility.

He rejects the idea of what amounts to a health care tribunal where bureaucrats decide what is best for patient care and interfere's with the doctor-patient relationship.

With regard to competition, he has this observation.

eliminating state regulations on health insurance would allow for broader competition and lower prices for consumers.

Currently each state regulates all insurance products, not just health insurance. The result is, what is covered under a Georgia health insurance policy may not be covered in Ohio and vice versa. Sometimes it seems lawmakers at the state OR federal level have nothing better to do than dream up more laws to justify their position and find ways to spend money they don't have.

We have addressed some of the problems associated with mandates before including black & white and blind ambition post just to mention a few.

Mr. Scott also addresses accountability which goes without saying. If no one is held accountable for their actions then reform is a free-for-all. That didn't work, so let's try this.

Kind of like your doctor saying "oops" in the middle of a tedious procedure.

His last pillar is personal responsibility . . . something that seems to be lacking across the board including our current system. It seems as if no one wants to pay for anything and expects carte blanche treatment.

What are they smoking?

He also warns us of problems that exist in other countries where "universal care" has been the norm for some time.

Because of budget constraints, regulators in the United Kingdom dropped pap smears for women under 25. The result - young women are dying of cancer that could have been treated if the cancer was discovered in its early stages. Many Canadians have to wait months for diagnostic tests to determine whether their tumors are malignant, giving cancerous tumors time to worsen, spread and progress to an irreversible stage.

Somehow Michael Moore and the main stream media never wants to report that. Wonder why?

And here is an eye-opener.

Worse, the danger of Washington's recent willingness to spend inordinate sums of money on anything deemed to be a problem, is that we are conditioning ourselves to believe that our government has unlimited resources - and that any problem can be solved by simply spending vast amounts of cash. What politician wants to be in office when it comes time to admit we can no longer spend for services we have come to expect?

Fannie Mae's and Freddie Mac's failed experiment to improve home ownership for "low and middle income families" should be a wake-up call to those who believe more government involvement in American healthcare will help "low and middle income families". These two initiatives resulted in politicians being accused of receiving favored treatment, low and middle income families being forced out of their homes and a federal bailout that could cost taxpayers as much as $2.5 trillion. We never envisioned politicians receiving favored treatment, the housing meltdown caused by the expansion of these programs, nor the unbelievable number of low and middle income families being evicted from their homes with their life savings depleted. It's not difficult to imagine similar results under a national health care system.

This is something I have been saying for months. Perhaps Mr. Scott has been reading my posts or maybe we are channeling each other.

I particularly liked his "Fannie Med" term. I think I might just steal that, especially since we are already in sync on so many other things.

Miami (Not) Nice

[Welcome Industry Radar readers!]

Finding health insurance in Georgia is usually not that difficult, if you know the rules. Most people, including the bulk of agents, do not. I have a reputation for taking on challenging cases and almost always finding a good offer. That's because I know the rules of engagement.

John Dorschner of the Miami Herald isn't playing nice. His ignorance of risk management coupled with publishing (on the web) a carrier guide that is clearly marked "Confidential & proprietary" makes one question his ethics. His article subitled "How health insurers secretly blacklist those with certain ailments" while based in truth shows his ignorance.

Trying to buy health insurance on your own and have gallstones? You'll automatically be denied coverage. Rheumatoid arthritis? Automatic denial. Severe acne? Probably denied. Do you take metformin, a popular drug for diabetes? Denied. Use the anti-clotting drug Plavix or Seroquel, prescribed for anti-psychotic or sleep problems? Forget about it.

This confidential information on some insurers' practices is available on the Web -- if you know where to look.

So for the price of a newspaper, Johnny boy is going to spill the beans.

Any idea how much gallbladder surgery runs? About $4800 according to Out of Pocket.

How about a popular RA drug such as Enbrel? Try $1500 for a 30 day supply. Plavix ($565) or Seroquel ($126) are a bit more reasonable but these meds are just a small portion of the cost of treating such illnesses.

Johnny Reporter apparently doesn't own a calculator or know how to use it.

What's more, you can discover that if you lie to an insurer about your medical history and drug use, you will be rejected because data-mining companies sell information to insurers about your health, including detailed usage of prescription drugs.

Is Johnny suggesting you should perjure yourself in order to secure coverage? Isn't this like the liar loans that led to the mortgage crisis?

Where is this guys moral compass?

``Basically, they're taking only the healthy so they can get the fattest profits. If you really need insurance, then you can't get it.''

Kind of like, if you really need a loan, you can't get it. Unless of course you applied for a mortgage in the last 10 years or so. We know how that one ends.

Sorry, but refusing coverage to someone who is knowingly going to "bust the bank" is not about profits. Approximately half a dozen states have mandated guaranteed acceptance health insurance and guess what? Carriers are allowed by the Dep't of Insurance to charge roughly 3x the premium for similar coverage in non-guaranteed acceptance states and still make a profit.

The reason some carriers will deny coverage is because the risk of accepting that individual is so high that an adequate rate would exceed the amount allowed by the state Dep't of Insurance.

In other words, the GOVERNMENT, not the carrier, is limiting the rate and controlling access to the market. If the GOVERNMENT did not restrict the carriers from charging an adequate premium anyone could find coverage for any pre-existing condition, treatment plan or medication.

Sandra Foertsch, who sells individual policies, says the fundamental concern of insurers is clear: ''They don't want to buy a claim,'' meaning that they would start to collect $500 monthly premiums from a person and quickly pay out more than that to doctors and other providers.

Sandra Foertsch is an example of an agent without a clue. She is someone who needs to find a job asking folks if their order is for here or to go.

Searching the Web, The Miami Herald found underwriting guidelines for Coventry Health Care, which owns Vista; Wellpoint; Assurant Health; and Blue Cross Blue Shield of Nebraska.

Among the health problems that the guides say should be rejected: diabetes, hepatitis C, multiple sclerosis, schizophrenia, quadriplegia, Parkinson's disease and AIDS/HIV.

Again, Johnny Reporter shows his ignorance about risk management and his apparent disdain for legal disclaimers that the information is proprietary.

Beyond that, let's face it. Carriers are not the federal government who can write checks without having money in the bank and do so to the tune of trillions of dollars.

I wonder if the Miami Herald has access to unlimited funds and is able to pay for reporters without regard to their ability to understand basic economics or legal disclaimers? Perhaps Johnny Reporter is a graduate of the College of Community Organizing and firmly believes anything can be solved by simply throwing more money at it.

Johnny Reproter is showing his ignorance in a starring role in Miami Not Nice. It's pretty difficult to take this guy seriously, but apparently some do.

Folks looking for health insurance don't have to deal with people like Sandra Foertsch or take advice from Johnny Reporter. Clients of Georgia Insurance Shop with apnea, type II diabetes, gallstones and other ailments can often find the coverage they need.

Clash of the (Wonky) Titans

FoIB Michael Cannon of the esteemed Cato Institute takes to the pages of McPaper today, offering a vehement contradiction to Dr Kevin Pho's recent op-ed in the national daily. The subject is "comparative-effectiveness research," which seeks to analyize which medical processes work best.

Both are worth reading, if only to get a sense of how two very bright guys differ on matters of both health policy and implementation.

Wikio Rankings - InsureBlog Exclusive

Audrey Fleury, Account Manager at Wikio, sent me a heads up on April's Wikio Rankings, on which we've move up a few notches (Yay!). I must admit, it's quite heady (and a bit intimidating) to be ranked up there with the likes of Kevin, MD and Health Care Renewal; Drs Pho and Poses are both highly regarded in their fields.

And, of course, it's nice to be back in the Top 20.

And as a MOTT, the number 18 also holds special significance for me. Thanks, Audrey!

1 Kevin, M.D. - Medical Weblog 2 Highlight HEALTH 3 GoozNews 4 In the Pipeline 5 The Carlat Psychiatry Blog 6 The Covert Rationing Blog 7 DB's Medical Rants 8 Her Bad Mother 9 The Doctor Is In 10 Health Care Renewal 11 Diabetes Mine 12 Healthcare Economist 13 Junkfood Science 14 Schwitzer health news blog 15 Six Until Me. 16 Musings of a Dinosaur 17 Fight Aging! 18 InsureBlog 19 ScienceRoll 20 Disease Management Care Blog 21 Brain Blogger 22 Doctor Anonymous 23 StevePavlina.com 24 Pallimed 25 retired doc's thoughts 26 The-F-Word.org 27 Caustic Musings 28 Autism Vox 29 John Goodman's Health Policy Blog 30 Beyond Meds 31 Weighty Matters 32 Cranky Fitness 33 Eye on DNA 34 Adventures in Autism 35 Dr. Deb 36 AlexShalman.com 37 CancerDiva 38 The Urban Monk 39 Brass and Ivory 40 The Last Psychiatrist 41 Autism News Beat 42 The Independent Urologist 43 Autism Street 44 HD BizBlog 45 Global Health Policy 46 Digital Doorway 47 Feed Me! 48 Jung At Heart 49 The Trouble With Spikol 50 soulful sepulcher 51 Women's Bioethics Project 52 Big Fat Deal 53 All 4 My Gals 54 MSSPNexus Blog 55 Aging Fabulous 56 John McManamy's SharePosts 57 PixelRN 58 Capital Health WW-MD's Notes 59 Alzheimer's Notes 60 How To Use The Law Of Attraction

61 The Rotund 62 Natural Variation - Autism Blog 63 Stayin' Alive 64 Teen Health 411 65 The Voyage 66 lend4health [beta] 67 The Change Blog 68 ReunifyGally 69 You Already Know This Stuff 70 fat fu 71 Pinwheels 72 Take A Bite 73 Bump on the Road 74 Facing Autism in New Brunswick 75 Slow Down Fast 76 ...salted lithium. 77 Andrea's Buzzing About: 78 Tech Medicine 79 Medical Marginalia 80 Fat Man Unleashed 81 A Nurse Practitioner's View 82 hospital impact 83 ByronKatie.com 84 Fighting Fatigue 85 One Dad's Opinion 86 Herbal Connection 87 TomographyBlog.com 88 Kidney Notes 89 Big Blueberry Eyes 90 Plasmetic.com 91 Medicine for the Outdoors 92 Med Law Blog 93 Healthy Children 94 Heal Pain Naturally 95 Postpartum Progress 96 Lovely and Amazing 97 Mauzy's Musings 98 Monk at Work 99 AIDS.gov blog 100 Sleep Disorders Ranking by Wikio.

Major Thanks and Belated Blogiversary

Without a doubt, I have the best co-bloggers on the 'net. As regular readers may have surmised, I was on vacation this week, with extremely limited web access. But Bob and Mike filled in handsomely, and Bill was instrumental in implementing our first ever April Fool's Day post.

Thank You!!

And I was remiss in failing to note that, a few months ago, we passed a major milestone: our 4th Blogiversary. We've certainly come a long way in those first 4 years, and look forward to many, many more.

Musical Marijuana

[Welcome Industry Radar readers!]

Musical legend Carlos Santana wants President Obama to legalize pot.

"Legalize marijuana and take all that money and invest it in teachers and in education. You will see a transformation in America."

Invest marijuana profits (or taxes on the sale and/or profit) to invest in education. Interesting concept. Since Congress is adding a tobacco tax to fund the SCHIP health care plan, why not legalize pot and tax it for education?

Maybe he is on to something.

"I really believe that as soon as we legalize and decriminalize marijuana we can actually afford a really good governor who won't keep taking money away from education and from teachers and send him back to Hollywood where he can do 'D' movies and we can get an 'A' governor," continued Santana, referring to former movie star and current California Gov. Arnold Schwarzenegger.

Here in Georgia we legalized gambling (state run lottery) and used that tax to fund education. Of course we are still 48th or so in the nation but imagine where we would be if not for the lottery tax on the poor?

More is Less?

Georgia health insurance is no different from any other part of the country. The GAO (Government Accounting Office) says that the small group market is concentrated, with only a few carriers competing for business.

The GAO report analyzed 39 states' health-insurance markets and found that in 34 of the markets, the top 5 insurance carriers accounted for more than 75% of the small-group market, compared with 26 states among 34 analyzed in 2005 and 19 among 34 states in 2002. What's more, the median market share of the largest small-group insurer in each market increased to 47% in 2008, up from 43% in 2005 and 33% in 2002.

The worry, of course, is that more concentration leads to less competition and will only exacerbate price increases for small companies.

So having fewer carriers means less competition and higher prices. Of course some folks are calling for a "single payer" system, which of course is is less than a few carriers.

And there is this.

No doubt when one entity is the dominant or only player prices can become sticky. Of course when the government is the only player they can name their price and play by rules that apply to them and not to anyone else. That is why Medicare reimbursements to providers are below market and Medicaid even lower.

It is also why so many medical providers refuse to accept Medicaid patients and Medicare providers limit the number of patients they are willing to treat.

So this begs the question.

If less competition is bad (according to the GAO) and single payer (as in Medicare, Medicaid) is worse, how will the GAO (or any other government entity) encourage more competition?

Small business owners looking for Georgia health insurance have at least a dozen major carriers and easily double that number when minor players are factored in. If we are to believe the GAO, those carriers operate in a vacuum and there is no incentive nor market forces that prohibit them from overcharging.

If the GAO had a clue (and nothing indicates they do) they would know that the DOI regulates the prices carriers can charge and LIMITS the rate up that can be applied for adverse health conditions. I have several small groups where the monthly claims easily exceed monthly premiums and has done so from the start.

So how will introducing more carriers change this?

It won't.

Many of these clients are getting a 100% return on investment on their premium dollar. For every $100 they pay in premiums they receive $200 in benefit.

Would the GAO have us believe this is bad for the consumer?

Democratic Representative Nydia Velazquez offers this observation.

"Americans across the country know our healthcare system is broken, as millions find themselves on the growing rolls of the uninsured each year, while those with health insurance see costs skyrocket," said Velázquez. "Meanwhile, small firms are grappling with how to pay for rising premiums, while continuing to offer their employees coverage. It has become clear that our current healthcare system is not only morally indefensible, it is also economically unsustainable."

Define broken?

Most of those "millions on the growing rolls of uninsured" are there by choice. Roughly 15 % of the uninsured are "young invincible's" who choose to spend their money on iPhones rather than health insurance. Another 15 - 20% are illegal aliens. About 20% are children, many of whom qualify for taxpayer funded plans such as Medicaid or SCHIP.

But yet our current health care system is "morally indefensible" and "economically unsustainable".

So are trillion dollar deficits . . .

One bright spot in Ms. Velazquez' epistle is this.

Unless the fee cut problem is addressed permanently, many small providers could have no choice but to turn away Medicare beneficiaries.

"Many smaller medical practices are small businesses and are responsible for expenses like rent, payroll, employee health insurance and malpractice insurance," said Velázquez. "Until the Medicare physician fee cut is permanently addressed, smaller providers will face difficulty making long term investments in their practices. Even worse, the projected cuts to Medicare could create a situation where small practices stop admitting Medicare patients."

So government run health care isn't the answer either.

Especially when it is underfunded.

Excuse my skepticism, but I haven't seen evidence that more government is the answer to ANY problem. Individuals and private business cannot continue to operate year after year by spending more than they take in. Eventually even the government will run out of money and will be forced to reduce services, raise taxes, or both.

Seems to me like the cure is worse than the problem.

The USPS is a "quasi-government" entity. Almost every year they raise prices and deliver less service. Fannie Mae and Freddie Mac also operate as quasi-government entities but yet they led us down the road to economic collapse in the mortgage market.

Not very promising, huh?

Cavalcade of Risk #75: Call for Submissions

John Leppard hosts next week's Cavalcade of Risk. Submissions are due by Monday the 6th, and Cav goes live on the 8th. John asks that you include:

■ Your blog's url

■ Your post's url

■ The post's trackback URL (if available)

■ A (brief) summary of the post

And PLEASE remember: ONLY posts that relate to risk (not personal finance tips and the like).

You can submit your post via Blog Carnival or email.

Massachusetts. Ho? Or Hum?

[Welcome Industry Radar readers!]

This article contains some of the news. Whether it’s all fit to print is another matter.

As is common in NYTimes articles, the best stuff is often found down near the end. That is, after all the stuff that editors with an agenda think is more important.

Check out the 4th from the last paragraph. Aw heck, here it is:

“Really controlling costs requires just stopping spending,” said Stuart H. Altman, a professor of health policy at Brandeis University.

Really, professor?

Now read the next-to-last paragraph:

“It forces us to look in the mirror and say, ‘What do we do about health care spending?’ ” said Jon M. Kingsdale, executive director of the agency that administers Commonwealth Care.

My opinion? These experts are pushing EXACTLY the wrong solution. Their focus on spending leads to worse results for people, not better results.

Why is that?

Because the problem is the cost of health care. Fix that, and the spending problem is solved. Fail to fix the problem of cost, and the spending problem will be with us forever - no matter how politicians try to hide it. The Massachusetts program clearly demonstrates the truth of this statement. A focus on “spending” inevitably leads to rationing and ham-fisted ways to reduce what the government pays for health care, by reducing the supply of health care (think of Canada or Britain) or by restricting the public access to it (think of the same countries, again). That is not a solution. That is running thru Hell in gasoline pants.

Bob and Yogi

Please take a gander here, at Health Access, this week's host for Health Wonk Review. Bob Vineyard, one of InsureBlog’s own Health Wonks, is featured at about (i.e., exactly) the 11th paragraph, ruminating on the pros and cons of insurance companies eliminating medical underwriting.

A treat indeed from top to bottom, this week’s Review is peppered with the sayings of Yogi Berra, which you’ll not want to miss.

And while you’re enjoying the read - and you will enjoy the read - remember that Yogi also said “I never said half the things I said”.

How Many Texans Does It Take to Fill the E.R.?

No, this is not a joke. Abuse of Emergency Rooms is a growing problem that cost's everyone. For many, the E.R. is their PCP (primary care physician).

In Texas the E.R. seems more like an old friend to some.

In the past six years, eight people from Austin and one from Luling racked up 2,678 emergency room visits in Central Texas, costing hospitals, taxpayers and others $3 million

Nine people, 2,678 E.R. visits, $3,000,000.

Who are these people?

All nine speak English; three are homeless; five are women whose average age is 40, and four are men whose average age is 50. Seven have a mental health diagnosis and eight have a drug abuse diagnosis.

That last statistic is significant.

At one time, many with mental health issues were confined in state run facilities. Budget cuts and "patient rights" advocates changed all that.

According to the report, the average E.R. visit cost's taxpayers about $1,000. The total spent on these 9 people average $55,000 per year.

That's $55,000 in "free" care that is borne by taxpayers, insurance policyholders and those who are financially responsible for their own medical bills.

The group who collected this data has information on 750,000 uninsured and "underinsured" people. The database includes 900 repeat offenders . . . people who visited an ER six or more times in three months - had 2,123 preventable visits in 2007.

A preventable visit is one that could have been treated in a non-emergency care facility such as a doctors office or clinic.

The cost of preventable visits?

More than $2,000,000.

If we want to control health insurance premiums, and taxes that go to entitlement programs such as Medicaid & SCHIP, then we need to find a more effective way of controlling health care cost. Identifying repeat offenders and finding more efficient ways of dealing with their medical issues is a step in the right direction.

Stupid Government Tricks

Life insurance proceeds are, with few exceptions, received free of any income tax. But that may change if the Oregon taxer's get their way.

"Oregonians who purchase life insurance and annuity products to assure the financial security of themselves and their loved ones would be hit with a tax that undermines their carefully-made financial protection, long-term savings and retirement income. H.B. 2854 would impose a tax on the life insurance benefits received by Oregon families suffering the death of a loved one. It would also impose a new tax on savings through life insurance and annuities.

Sorry your spouse died. Here is a check, less the state's cut. We need it more than you do.

Good public policy encourages financial security and self-reliance. This is especially so today when Oregon is facing 11 percent unemployment and struggling through a financial crisis that has drained the savings of so many of its citizens. Yet, H.B. 2854 goes in the opposite direction, taxing already beleaguered savings plans and penalizing families when they suffer a loss.

Is there no end to the money grabbing taxer's? Just one more example of stupid government tricks.

Ballpark Diet

Buy me some peanuts and a 4 pound burger, I don't care if I never get back.



Just when you thought it was safe to have a fun time at America's sport, this happens.

It's not bad enough that you pay $10 to park, another $14 to sit in nosebleed seats, $8 for a beer and $7 for a hot dog, now you have a 4800 calorie burger to deal with.

The four-pound, $20 burger features five beef patties, five slices of cheese, nearly a cup of chili and liberal doses of salsa and corn chips, all on an eight-inch sesame-seed bun.

How about I leave off the bun?

Enjoy!

Introducing the International Institute for Health Care Policy Analysis

Longtime IB readers know that we used to be hard-nosed, unthinking, inflexible free market flunkeys. That is, we rejected the very notion that government-run health care, and government sponsored health insurance, could be highly efficient and, indeed, desirable.

One can't, however, read the daily barrage of helpful, insightful emails we get from various organizations, clearly and intelligently framing the issues, and offering viable, attractive solutions to the obvious crisis we now face without being moved. It is in that spirit, then, that we decided to pull up short, take stock, and recommit ourselves to a new system of fairness, efficacy and well-being.

To that end, we've pulled together many of the excellent and well-crafted suggestions we've gleaned from all these missives, and decided to launch our own initiative, to be administered by the newly minted International Institute for Health Care Policy Analysis.

The IIHCPA's core principles include:

■ A shared vision of the kind of health care system that will meet the needs of 21st century America.

■ Administrative inefficiencies associated with a fragmented healthcare financing and delivery system create more paperwork, redundant care, and increases medical errors.

■ Human rights principles require that we treat health care as a public good.

Our overarching goals will be:

■ Focus on controlling spiraling health care costs by implementing a rapid diffusion of Information Technology.

■ Health care should be publicly financed and administered.

■ Based on human rights principles, health care must be financed in a way that is accountable to the people and responsive to health needs, rewarding quality, appropriate care and improved health outcomes.

Won't you join us? Membership is easy, inexpensive and ultimately rewarding, as you help re-shape the shape of health care in the 21st Century.

[Thanks to Bill Halper]

Free Health Care! Really!

Want free health care?

No, this is not a joke. Truly free for uninsured and those who have lost their job.

Walgreens said patients who lose their job and health insurance after March 31 will be able to get free treatment at its in-store Take Care clinics for respiratory problems, allergies, infections and skin conditions, among other ailments. Typically those treatments cost $59 or more for patients with no insurance.

The charitable side of me says this is a great thing.

The cynic says, wonder how many folks will try to game the system and spoil it for everyone?

Hal Rosenbluth, chairman of the Take Care Health Systems division, described the plan as something close to an experiment: He said Walgreens isn't sure of patient demand or how much providing the services might cost the company.

No doubt there is a cost that is being absorbed by Take Care. There is also the intangible good will from something like this.

You may recall Wal-Mart started the $4 generic thing and others have followed suit. This has been a win-win all around for consumer and the pharmacy's offering discount generics.

Patients must present proof they are unemployed, including a federal or state unemployment determination letter and an unemployment check stub. They will have to sign a form at the clinic saying they have lost their jobs and health benefits. If they find a new job or get new health insurance, they will no longer be eligible for free care.

Spouses and children are also eligible for free services if they don't have insurance of their own.

Medical lab operator Quest Diagnostics is participating in the program by offering free tests for step throat and urinary tract infections.

I think this is a good thing. I hope to see more companies take such a generous step.

Those who are uninsured in Georgia and looking for health insurance will be wise to check out our Resource page.