Friday, May 31, 2013


So the other day, I'm corresponding with the practice manager of one of my physician group clients. This particular PM is extremely professional and knowledgeable, to the point that I rarely hear from her unless I instigate the conversation. I had emailed her regarding the upcoming ObamaTax compliance issue we wrote about earlier this week.

I really just wanted to know if she had any questions, or would like to meet for a mid-year plan review. She politely declined, but what got my attention was her reason: she was knee-deep in implementing new EHR (Electronic Health Record) tech, and that it was proving to be a massive challenge for her - she simply couldn't spare the time for anything else.

This is an obvious problem with such a massive new requirement. But inherent in that challenge is an even greater one: how can smaller practices afford this kind of investment? It is, in fact, one of the most egregious (intended?) consequences of the ObamaTax:

"[F]or those who don’t meet the electronic medical records deadline for implementation, the government has laid out a series of penalties. The message to doctors is clear: implement electronic records or pay a price."

But if you're a small(er) practice, how do you afford this implementation? As Nate pointed out last Fall, "the move to electronic health records may be contributing to billions of dollars in higher costs for Medicare, private insurers and patients ... hospitals that received government incentives to adopt electronic records showed a 47 percent rise in Medicare payments at higher levels from 2006 to 2010"

Which brings me to my real question: doesn't (expensive) EHR implementation actually encourage smaller providers to seek refuge in (ie be bought out by) larger ones? In the long run, economy of scale will always trump the little guy.

Late Morning LinkFest

■ HHS Secretary Shecantbeserious sure loves her slushies. No, not that kind, this kind:

"A little-noticed part of [the ObamaTax] channels some $12.5 billion into a vaguely defined “Prevention and Public Health Fund" ... the department can spend the money as it sees fit and without going through the congressional appropriations process. The sums involved are vast. By 2022, the department will be able to spend $2 billion per year at its sole discretion. In perpetuity."

Well, at least until the money runs out.

As we've long documented here at IB, the Much Vaunted National Health System© has become a (sick) joke, and yet the Brits are only now beginning to "get" it:

"The truth is, though, that these problems have been going on for years. The difference now – and the Government deserves credit for this – is that this dirty linen is starting to be washed very publicly"

What's truly frightening, though, is that at one point, the British government allowed a private group to run an MVNHS@ hospital, one which (when under government control) had been "under threat of clsoure due to poor care and financial deficits."

So what happened when a private consortium of doctors took over? Guess.

And, finally, some sobering news from FoIB Holly R, who sends us this very helpful, well-balanced NPR story on the travails of long term care, including this moving and informative video:

"48 years old and single"

Who'll take care of Rebecca?

People don't plan to fail, they fail to plan.

Student Health Exchanges

No, not those Exchanges. These Exchanges:

"Students at [University of Illinois Chicago] covered by the school’s health insurance will have an added benefit come the fall: sex change surgery."

We've long dismissed student health plans as poor values, but we never expected this turn of events.

One presumes that Ms Shecantbeserious is eying this development with a gleam in her eye....

Obamacare Train Wreck - Krugman Weighs In [UPDATED]

[Scroll down for updates]

Paul Krugman, economist, may know economic theory but his knowledge and understanding of health care and health insurance put him in the same class with Ezra Klein.

Guys, don't give up your day job.
In some states, like California, insurers reject applicants with past medical problems. In others, like New York, insurers can’t reject applicants, and must offer similar coverage regardless of personal medical history (“community rating”); 
NY Times

Wrong Paul.

Community rating has nothing to do with guaranteed issue.
Obamacare closes this gap with a three-part approach. First, community rating everywhere — no more exclusion based on pre-existing conditions.
You repeat this, which means the first time was not a slip, just ignorance.
 Well, the California bids are in — that is, insurers have submitted the prices at which they are willing to offer coverage on the state’s newly created Obamacare exchange. And the prices, it turns out, are surprisingly low
Define surprisingly low.

He doesn't.

Instead he links to articles from New Republic and Washington Post as his proof that Obamacare will be affordable and no sticker shock.

Both articles factor in subsidies, which may or may not be available. Neither article mentions the skinny networks or the tiny drug formularies, both of which can make the plan difficult to actually use from a consumer standpoint.

Kind of like the Yugo.

Yes, it isn't much of a car but look how AFFORDABLE it is.

Sorry Paul. Not impressed.

THIS JUST IN (from Henry Stern) . . .

 six states with active purchaser policies: California, Massachusetts, New York, Oregon, Rhode Island and Vermont. These are the only six states in the nation that have the power to turn away a health insurer that doesn’t, for example, offer competitive rates–or maybe doesn’t provide a wide enough network.
Washington Post

In other words, The Republik of Kalifornia picks for you.

Just like Obamacare.

If you like the plan you have now, get over it.

UPDATE . . .

And Forbes weighs in as well.

As it turns out the health insurance to be sold in the California exchange excludes some of the best hospitals and the best doctors. Also, the fees paid to providers will not be the same as commercial insurance are paying. They will be somewhere between the commercial rates and Medicare rates. This means that people with exchange acquired insurance will be less desirable to providers from a financial point of view than people in orthodox plans. As the Los Angeles Times explains:

People who want UCLA Medical Center and its doctors in their health plan network next year, for instance, may have only one choice in California’s exchange: Anthem Blue Cross. Another major insurer in the state-run market, Blue Shield of California, said its exchange customers will be restricted to 36% of its regular physician network statewide.
And Cedars-Sinai Medical Center, one of Southern California’s most prestigious and expensive hospitals, said it’s not included in any exchange plans at the moment.

Thursday, May 30, 2013

ERRP . . . Obamacare Indigestion

PCIP. Great idea. Complete flop when it closed early due to lack of funds. 

How can that be? DC printing presses on strike?

Now we find out that ERRP (Early Retiree Reinsurance Program) ran out of gas too.
PPACA drafters created the ERRP system, to encourage employers to keep health plans for retirees ages 55 to 64 in place. Congress provided $5 billion in funding for early retiree health plan subsidies. ERRP managers were supposed to use $300 million of the allocation for administrative expenses and $4.7 billion for employer plan reimbursement claims.
Congress also provided $5 billion in funding for PCIP (pronounced "P-sip").
PCIP was supposed to provide health coverage for uninsured people with serious health problems who could not qualify to buy private health coverage. PCIP enrollees are supposed to pay premiums comparable to what healthy people in their states pay for individual commercial coverage.
Operative word here is SUPPOSED.
Although ERRP funding was supposed to last until the end of 2013, program managers at CCIIO had to suspend enrollment in the program by May 2011 because expenses were running so high, Czerwinski said.
ERRP managers ran out of the $4.7 billion in funding for ERRP claims in September 2012, and, at that time, they had 5,699 open claims for reimbursement.
The employers that submitted the reimbursement claims have asked for a total of $2.5 billion in payments, Czerwinski said.
Employers left holding the bag.
Wonder why CBS isn't reporting this?
Before PCIP started up, Medicare actuaries predicted that the program would have 375,000 enrollees by the end of 2010.
Actual enrollment was only about 49,000 at the end of 2011, and it increased to about 103,000 at the end of December 2012, Czerwinski said.
Good thing they never hit their projections.
I don't know about you, but this doesn't give me warm fuzzzies about Obamacare 2014.

Free Health Insurance Numbers Grow

Record numbers of individuals on Medicaid as the count grows past 72 million. With over 48 million on Medicare and 320 million living in the US that translates into almost 40% of the population is not paying for health insurance (or is paying very little).
The 72,600,000 enrolled in Medicaid in the United States in 2012 was more than the 65,630,692 people who lived in France last year, according to data published by the Census Bureau, or the 63,047,162 people who lived in the United Kingdom.
In fact, if Medicaid was a country rather than a U.S. government program it would be the twentieth most populous nation in the world, ranking just ahead of Thailand, which had 67,091,089 people in 2012, and just behind the Congo, which had 73,599,190 people in 2012.
The country of Medicaid.
Am I the only one that finds this depressing?
In fiscal 2008, the last full year before President Barack Obama took office, there were 58,794,000 Medicaid enrollees. Since then, Medicaid enrollment has expanded by more than 23 percent.
Wonder if the president has read about this in the news? Seems that is the only way he learns what is going on in this country and especially within the government.

ObamaTax: Another Nail

As we've long documented, one of the (intended?) effects of the ObamaTax is a looming physician shortage. But perhaps some clarification is needed: the shortage is most likely to hit the insured and/or less wealthy demographic first.

Why is that, you ask?


"Dr. Michael Ciampi [has] ... stopped accepting all forms of health insurance. In early 2013, Ciampi sent a letter to his patients informing them that he would no longer accept any kind of health coverage, both private and government-sponsored"

And to make sure his patients know exactly how that would impact them, he's also taken the full-transparency route (for which we also applaud him) by posting all his prices on-line.

Regular readers may recall our (exclusive) interview with Dr Rob Lamberts last fall, when he explained how his new practice model - Direct Primary Care (DPC) - works:

"The DPC model is one in which the patient pays the doctor directly for their care, usually in the form of a monthly "subscription," plus or minus a fee for visits."

That's different from how Dr Ciampi has evolved his practice; he "collects payment at the end of the visit, freeing him of the time and costs associated with sending bills."

It also frees him to charge whatever he likes (well, whatever the market will bear, anyway) without having to answer to insurance or government bureaucracies. It also means that he can spend more time with patients. Nothing wrong with that.

California's Sneaky Little Trick

There has been much discussion about affordability in the insurance exchanges. From huge potential rate increases to lower than current rates being proposed under Covered California, the range of costs vary significantly.

So it came as a surprise last week when news broke that California's program was showing lower than projected premiums. Ezra Klein called it "Very Good News for Obamacare." Major news networks cited the release telling viewers that premiums were going down.

Then came the rest of the story. Indeed Covered California was going to see a rate reduction for individual insurance. BUT, these plans were compared to the average small group plans. For perspective, the average premium for individual plans sold through EHealthInsurance in California last year was $177 a month. Covered California said the average premium for the three lowest Silver plans statewide was $321 a month, albeit for more comprehensive benefits.

So, why compare 2014 individual rates to today's small group rates? Well, Covered California provided this little gem for you:
"It is difficult to make a direct comparison of low rates to existing premiums in the commercial individual market because in 2014 there will be new benefits and today’s coverage on an actuarial basis is all over the map. The best frame of reference is by looking at current rates available in the small group market in California. Each market is a competitive market with guaranteed issue. Comparing rates to comparable products in the small employer market, rates ranged from two percent above the 2013 average premium to 29 percent below the rates in California’s most populous markets. This is impressive since the 2014 products include doctor visits, prescriptions, hospital stays and more essential benefits."

What's really going to be impressive is if these "preliminary" rates will actually hold.

Wednesday, May 29, 2013

Cavalcade of Risk #184: Post-Memorial Day Risk-a-thon

Jeff Rose hosts this week's small - but powerful! - roundup of risk-related posts. From fast-food to k-rations, you'll run little risk of being disappointed.

Thanks, Jeff!

MVNHS© Back in the News

Thanks to alert IB reader Peter K, we have two new items to add to our Much Vaunted National Health System© database. Last month, we noted that "[MVNHS©] doctors are prematurely ending the lives of thousands of elderly hospital patients because they are difficult to manage or to free up beds;" this was one side of the coin. It only gets worse, though, when one considers the other side of it:

"Patients undergoing planned operations on the NHS are far more likely to die if they have their operations towards the end of the week ... those who had surgery on a Friday were 44 per cent more likely to die following the procedure than those who had the same operations on a Monday." Of course, when you have an overworked and largely unaccountable group of people providing "care," that TGIF mantra becomes somewhat problematic, no?

It gets worse, though. One of the early criticisms of the ObamaTax is that you'd have care providers with the compassion of the DMV. This is already the case under the MVNHS©, and it's the direction we're headed:

"Almost 3,000 people may have died unnecessarily in just one year at the 14 NHS trusts whose excessive mortality rates were reviewed in the wake of the Mid Staffordshire scandal"

Regular readers may recall that we covered that particular shanda over 4 years ago (and it's still making news):

"Appalling standards of care that may have contributed to the deaths of at least 400 patients at a hospital trust were missed repeatedly by managers and regulators ... at Mid Staffordshire NHS Foundation Trust"

At least they've learned their lesson, though, right?

Um, not so much:

"The worst figures were recorded at Blackpool Teaching Hospitals where, in the year to October 2012, the number of deaths anticipated was 1,947 but actually there were 2,357, a difference of 410." [emphasis added]

This is extraordinary, on several levels. First, whatever are they teaching at this hospital? Advanced courses in euthenasia? Second, that "difference of 410" doesn't seem like so much, until one looks at the fact that they were off by almost 30%.

That's not "margin of error," that's Margin of Kevorkian.

Tuesday, May 28, 2013

Tuesday Afternoon LinkFest

■ First up, via email, United Healthcare lets us know that its "Early Warning Report forecasts the states, legal entities and group sizes ... that are currently eligible to be issued MLR premium rebates by [UHC] associated with the 2012 calendar year. Any owed rebates will be paid in July ... There are 21 states and two territories in which UnitedHealthcare does not currently anticipate paying any rebates associated with group business"

Don't spend it all in one place.

The Council for Disability Awareness has just released its 2013 Research Report, focusing on the differences between how employees perceive disability benefits versus how HR folks understand them. As one might imagine, it's a rather wide gap:

♦ Most HR professionals (84 percent) believe the ability to earn an income is their employees’ most valuable financial resource, yet only 26% thought their employees were adequately prepared to withstand a disability

HR professionals believe their employees are financially vulnerable to a loss of income

Both HR professionals and their employees severely underestimate the odds of becoming disabled

There's more, including the odds of becoming disabled and for how long. Recommended, and available here.

  Some good news and bad news on the ObamaTax front. First, the bad news (from its proponents' POV): voters favor repeal by a 22-point margin. One supposes that will only increase as we head into Fall, and the (scheduled) Exchange roll-out.

  And now the good news (for ObamaTax opponents): businesses are beginning to "get" just how bad this train-wreck is going to be, and more of them are looking to hop on the self-funded wagon:

"[H]ealth insurers are stepping up. Among their latest offerings: allowing ever-smaller companies to switch to a riskier form of coverage traditionally favored by big employers."

I'm sure Nate would disagree (as do I) with the "riskier" characterization, but the point is, going this route is likely to save some big dollars for employers.

There's a bit of irony here: way back in 2006, we had an exclusive interview with the folks at (now-defunct) ACMG, which was just then rolling out a self-funded program for smaller businesses. Kind of a shame that they were so far ahead of their time, but the post is a good introduction to how these plans work, and why they really aren't all that "risky."

E & Ooops

Much like doctors and lawyers carry malpractice insurance, licensed insurance agents carry Errors and Omissions (E&O) coverage. This type of liability policy protects policyholders (clients) if/when the agent screws up, causing financial loss.

Now come the Navigators. In addition to having to pass no background checks or graduate high school, these folks will also not be required to carry any kind of E&O coverage. Which is actually a good thing (from their perspective) because it's not clear that such coverage would actually be available to them even if they wanted it.

Professional liability insurance (including E&O) requires certain things to be true. In the case of E&O, one must be licensed to sell insurance. Okay, Henry, what about someone who isn't licensed, but needs this kind of coverage, such as an IT professional? There's no Ohio Bureau of Geek Licensing, but these folks would be eligible to purchase
Professional Liability insurance due to training and expertise.

Navigators may be neither licensed nor certified, heck, they don't even need a high school education to qualify; they'll simply attend 20 to 30 hours of instruction and be sent out the door, where they'll spread their, um, "expertise" to unsuspecting victims "clients." But what happens if/when they screw up? What financial recourse will their "clients" have? Their homeowner's policy (if any) won't cover them because it's business, and it's unlikely that they're independently wealthy (deep pockets).

Where's the consumer's protection?

Co-blogger Patrick pointed me to this article, which reports that Navigators in the Hawkeye State will be required to purchase surety bonds. The problem is that a surety bond is not the same as professional liability; it essentially covers theft of money.

For example, a Navigator tells a "client" that coverage will definitely be in force the next day. Three days later, the "client" has a heart attack and runs up tens of thousands of dollars in hospital bills, only to find out that coverage was not, in fact, in force. The most that "client" can recover from the Navigator is whatever he paid the Navigator for his services, not the huge hospital bills he now owes.

This would be where professional liability (E&O) insurance would come into play had a licensed agent been involved. From the article, it appears that Iowa Navigators must be licensed, so they may, in fact, be eligible for E&O coverage. But this is not the case in all 58 states; and therein lies the rub. Having spoken with two actual experts in this area, neither could think of a carrier that would write this coverage.

Which is not to say that it couldn't be developed, should the marketplace demand it. The problems inherent in underwriting such a plan, though, seem pretty insurmountable. And how would one price this in a competitive way? It's unlikely that most of the Navigators are going to be clearing $96-large; more likely, this will be another part-time job to help ends meet. So how do they afford even a minimum premium (generally hundreds - if not thousands -  of dollars a year)?

Yeah, that's what I thought, too.

[Huge IB Thanks to P&C Gurus Teresa S and Bill M for helping me noodle through this post]

Coming Soon - Obamacare Wait Times

Monday, May 27, 2013

ObamaTax Compliance heads' up

Received a sample notice that will (when finalized) have to be sent from employers to their employees later this summer. If you're interested, click here to download it. It's 3 pages, and pretty scary.

Scary, Henry?

Well, here's the thing. The employer will need to complete this form, and attest that, for example, his group plan meets the "minimum value standard." That is, that "the plan's share of the total allowed benefit costs covered by the plan is no less than 60 percent of such costs."

One presumes that the carrier will notify employers whether their group does, in fact, meet that criteria, but it's not entirely clear that this will be so for all carriers in all markets.

There's a related issue that so far seems to be flying under the radar: Exchanges and participation requirements. All carriers require that a minimum percentage of eligible employees sign up for coverage. This is to help reduce the chance of adverse selection, where only the least healthy enroll. The term "eligible" is somewhat flexible, but in general it's full-time employees who don't have "valid waivers." A valid waiver might be, for example, coverage through a spouse, or Medicare. Oddly, an individual medical plan does not qualify as a valid waiver, so that employee must be accounted for in the grand total.

So here's a question: if an employee opts off the group plan in favor of a (subsidized) individual plan from his state's Exchange, is that a "valid waiver?" This matters - a lot - because if enough folks opt off the group plan, it's going to go away, whether or not this is what the employer (and the other employees) want.

But remember: if you like your current plan, you can keep your current plan.

Or not.

[Hat Tip: FoIB Beth D]

Saturday, May 25, 2013

Obamacare | GSU Prof. Bill Custer Whiffs It

According to Georgia Health News citizens of the Peach State will have 7 (but in reality only 6) carriers to pick from when the 2014 Obamacare exchange, uh, marketplace rolls out this fall.

Aetna, Alliant, Blue Cross and Blue Shield of Georgia, Coventry, Humana, Kaiser Foundation Health Plan, and Peach State will offer a range of plans for individuals in Georgia as part of the Affordable Care Act’s exchange, or “marketplace,” which will debut in 2014.

Aetna is/will be buying Coventry so really only 6 players.

But that isn't where Custer made his last stand. It was this comment that raised an eyebrow.

“On average, these plans are coming in slightly less than premiums of employer plans,’’ said Custer.
He said he based that assessment on premiums for a single person in employer plans in the 2012 Kaiser Family Foundation/HRET benefits survey, where an HMO plan for an individual in the South averaged $456 per month.
“A lot of the fears about premium shock are unfounded, at least in these preliminary filings,’’ Custer said.
For starters, averages are mostly meaningless unless the buyer is . . . average.
But where Prof. Custer really blows it is in comparing individual rates (and apparently nothing else) with group rates.

Small group starting rates are roughly 2x individual rates for similar plans.

It would appear Mr. Custer also failed to consider the tiny networks that will be used by carriers participating in HIX and the even skinnier drug formulary.

Custer believers will be sadly disappointed when 2014 rolls around. I wonder if we should grade his advice on a curve?

Friday, May 24, 2013

Excessive Hospital Profits

These days it seems like everyone is a financial expert and wants to cast stones at people or companies they believe are "excessively wealthy" or "unjustly profitable".

The latest group is, of all people, a nurses association, that claims that hospitals are now the villains raking in obscene profits.

The nurses' research found what appear to be staggering statistics: U.S. hospitals charge on average $331 dollars for every $100 of their total costs, a 331 percent charge-to-cost ratio. From 2009 to 2011 (the most recent year for which the data is available), hospital charges lunged upward by 16 percent, while hospital costs only increased by 2 percent.
“There is no other word for this than price gouging,” said Deborah Burger, co-president of NNU whose research arm, the Institute of Health and Socio Economic Policy produced the findings based on an analysis of publicly available Medicare Cost Reports.
I realize most of these nurses probably never took a business course, but let's hope they know how to balance a checkbook. I will go out on a limb here and assume some of them have filed a health insurance claim at one point in their life, and then took the time to review the EOB.
If they did it would be obvious that the amount collected by the hospital bares no relationship to the actual billed charges.
Hospitals are like any other business in that, they report earnings based on collected revenue less expenses.
Almost no one pays sticker price for a car, or full fare for airline tickets. I wonder if these nurses believe car companies and airlines report earnings based on the full price?
If hospitals really were guilty of making a 331% profit EVERYONE would want to get in that game. I don't know about where these nurses live, but here in Atlanta hospitals are closing their ER and L&D departments because . . . they are losing money.
I guess they want to just hang on to the surgical and critical care parts that are the money makers.
So while the nurses believe the word of the day is price gouging, I would say there is a different word. I would describe the nurses as part of the low information crowd.

Outstanding Carrier Trick

As we reported almost 8 years ago, in our exclusive interview with its Medical Director Dr Dexter Campinha-Bacote, Aetna has long been in the forefront of health care transparency.

Now, our good friend David Williams blogs that the carrier has "won an Award of Distinction  for its short videos designed to help members comprehend and use their benefits."

David offers some great reasons why he approves of this development, and singles out Aetna's terrific payment estimator in particular:

Kudos, Aetna!

About that Union Label

Nice to see the legacy media catching up with us:
"[S]ome unions leaders have grown frustrated and angry about what they say are unexpected consequences of the [ObamaTax] ... The problem lies in the unique multiemployer health plans that cover unionized workers ... union plans were already more costly to run than traditional single-employer health plans. The [ObamaTax] has added to that cost"
Gee, who could have seen that coming?

Oh, yeah.

And it's not just the unions, either. A large majority of Americans (56%) believe it would be "[b]etter to go back to previous system" (pre-ObamaTax).

And this is before the Exchanges and (Evil) Mandate kick in.

What could *possibly* go wrong - An Update

Last week, we noted that the IRS was knee-deep into building the enforcement mechanisms for the ObamaTax. But just how deep are they really?

[Click graphic to embiggen]

Hospital Claim of the Day

Received an audit back on behalf of a client. When we can our plans only pay Hospitals their cost plus a 12% profit margin or Medicare plus 20%, which ever is greater. A member went to a new Spine Surgery Center and the bill was $8,300. Medicare + 20% was $620.28. Billed Charges are 1300% increase of Medicare allowable.

Luckily this new facility was out of Network so we don't have a PPO telling us we have to pay inflated prices. Even a 50% discount, top side for this market, would have been over a $4,000 bill.

Cavalcade of Risk #184: Call for submissions

Jeff Rose hosts next week's Cav. Entries are due by Monday (the 27th).

To submit your risk-related post, just click here to email it.

You'll need to provide:

■ Your post's url and title
■ Your blog's url and name
■ Your name and email
■ A (brief) summary of the post

PLEASE remember: ONLY posts that relate to risk (not personal finance tips and the like). And please only submit if you are willing to link back to the carnival if your submission is accepted.

Thursday, May 23, 2013

Obama Skinny Plan Irony

Prior to ObamaCare a few million people had these not-quite-insurance insurance mini med policies. The administration and pro-reform crowd decided people who purchased these plans needed protection from themselves and set out to wipe them away. Some of these forsaken plans had limits only in the tens of thousands. They might only pay a few hundred dollars per day for hospitalization or surgery.The requirement that plans have no limits, annual or lifetime when fully implemented would see these plans die a deserved death.

These helpless souls had much to look forward to under Obamacare, why they would have full comprehensive coverage at an affordable price....

....or not:
"Wonder what a “skinny” or “low-benefit” insurance plan is? The terms may vary, but the basic idea is that policies would cover preventive care, a limited number of doctor visits and perhaps generic drugs. They wouldn’t cover things such as surgery, hospital stays or prenatal care"
Thanks to ObamaCare they now have even fewer benefits then they had before.

Health Wonk Review: Cereally? Edition

Brad Wright offers up a clever, lighthearted and (his word) sardonic take on the Health Wonk Review. From Einstein to Beckham, angels and bell curves, you're sure to find something to amuse, enlighten and/or enrage you.

Kudos, Brad!

Insurance Library

The editors of InsureBlog are pleased to add Insurance Library to our all star blogroll.

I am very familiar with the originators of Insurance Library and know how much they give back to the public in the form of educational blogs and forums. Insurance Library is a new site but is rapidly growing their visitor count on a daily basis.

Consumers can review questions and answers on over 3,000 topics ranging from auto insurance to homeowners, life insurance, health insurance and Medicare. Insurance Library tries to take the mystery out of a complex problem and provide solutions that are workable.

Agents are allowed to participate by invitation only and will provide answers to a wide range of questions.

If you don't see a question that addresses your issues you may pose your own. In most cases a response will appear in 48 hours or less. Some very specific questions take more time to research, especially those that ask if a particular drug is covered by insurance.

Agents that participate have biographical information available including links to their website. If you would rather have your question addressed in private you may contact an agent of your choosing.

We hope you will visit Insurance Library and find it helpful.

You'll also find the link in our Blogs of Interest in the sidebar.

Doctor's orders

"ObamaCare is ... demoralizing doctors, distracting providers toward bureaucracy and away from patient care. It is disrupting quality and access, and damaging health."

Says whom?

Says Dr Charles Willey, "CEO of Innovare Health Advocates in St. Louis, a medical group employing five physicians and five nurse practitioners in five offices."

Dr Willey is suing the Feds to try to derail the "train wreck," focusing on the IRS's unique and powerful role in enforcing ObamaTax provisions. He points to government overreach like  the IRS's "attempt to enforce those penalties in states like Missouri" which, like 32 others, opted out of establishing its own state-run Exchange.

Best of luck to you in your efforts, Dr W.

[Hat Tip: FoIB Holly R]

Wednesday, May 22, 2013

The Grease Fire Spreads [UPDATED]

First HHS "suspended" enrollment into PCIP because of insufficient funding. Now comes word that HHS will be cutting payments to providers who treat those in PCIP. From the New York Times:

Under a new policy issued by Kathleen Sebelius, the secretary of health and human services, “health care facilities and providers will get paid less” for providing the same services to patients in the federal program, known as the Pre-Existing Condition Insurance Plan.
The article further stated:
Federal health officials said the alternatives were worse. If the program runs out of money, they said, some sick people will lose access to health care, and others will be unable to pay for the treatments they receive, forcing doctors and hospitals to write off large amounts of “uncompensated care.”  
In a regulation to be published Wednesday in the Federal Register, the administration says that doctors and hospitals must accept the amounts set by the government as “payment in full” for services in the high-risk pool administered by the federal government. 
On a related note, Ms. Shecantbeserious was busy touting the law in Europe. She "characterized the Affordable Care Act as part of a global movement toward better health through government-led reform."

Based on her words, one would guess that Government will need to seek additional funds (taxes?) while also cutting payments for health services (rationing?) Yep. This is our future under Obamacare.

UPDATE [HGS]: And some breaking news this afternoon on the PCIP front:

"Eighteen states have decided to turn their state Pre-existing Condition Insurance Plan (PCIP) programs over to [HHS Secretary Shecantbeserious]."

As Patrick notes above, the reduced payment scheme is going to really hurt prospective providers, and hence any patients that might want to be treated. But let it never be said that Madame Secretary's minions lack a sense of humor:

"These actions will help ensure the program's smooth transition to 2014"


On the Oregon ObamaTrail

Well, some good news for Beaver State residents who may be shopping for health insurance this fall. Unlike so many other states, carriers seem to be supportive of Oregon's Exchange:

"The Oregon Insurance Division has posted individual and small-group rate proposals for 2014 ... rate proposals from a total of 16 conventional carriers and two new CO-OP plans for the exchange and non-exchange markets."

Oregon is one of the minority of states that has chosen to implement its own Exchange, rather than rely on Ms Shecantbeserious and her minions to do so on its behalf. Noticeably absent from the list of participating carriers are Blue Cross and United Healthcare, two rather large elephants in the room. They've chosen to cast their lot with the non-Exchange market, instead.

Interesting developments.

Tuesday, May 21, 2013

Just 12 Easy Payments

Need Obamacare insurance? No problem. Click or call the exchange in your state using your Obama-phone. Complete the 20+ page Obama-application for financial assistance. Once approved you pick an Obama-plan and then in just 12 easy payments you will be the proud owner of your new Obamacare health insurance plan.

But wait.

Paying for it (even after financial assistance) may be a challenge for some.
For ordinary Americans deemed unbankable, those who don’t have a traditional checking or savings account, it can be hard to simply pay bills. And that is about to become a big problem for those who also lack health coverage -- and for the health insurance companies trying to sell them coverage. After all, how do you sell a product to a customer who has no way to pay you?

Money order? 

This is a problem for about 20% of the population. Wonder if the folks at HHS thought about this?

The new federal health law which requires most Americans to carry health insurance starting in January presents a particular problem for those households, since most health plans accept a credit card for the first month’s premium payment and then require customers to pay monthly with a check or an electronic funds transfer from a checking account.
The solution is simple.

REQUIRE everyone to have a credit card and a bank account.

Or REQUIRE the insurance carriers to accept EBT cards.

Buy here. Pay here.

No problem.

Unexpected Insurance Headlines

Offered without comment:

MetLife removes alien status from captive

Help Wanted

We've already noted that carriers seem to be actively avoiding the Exchanges due to go online in the next few months. Of course, that's for the individual market - the small group market must be doing gangbusters, though, right?


Turns out, maybe not:

"The California Health Benefit Exchange has put out a call for general agents ...  to recruit, train, supervise and support the retail agents that help the small employers that sign up for the state's Small Business Health Options Program (SHOP) exchange plans."

But why should they?

All along, agents have been told, at least implicitly, that their services aren't necessary (cf: Navigators). Agents must undergo fairly extensive scrutiny and training, and must continually update their professional education. All of which comes at a cost, in time and in money. Of course, the folks in Sacramento understand the value of the agent in the process, and are willing to pay for the very best.

No, I didn't think you'd fall for it:

"Exchange managers want general agents to keep estimates for total costs under $3 million"

Really, and just how many groups do they think will sign up?

Small Businesses are Exempt from PPACA?

A couple of weeks ago The Hill reported that 48% of small business owners believe that PPACA will hurt their business. In the article there is a quote from President Obama about the impact this will have on small business. He said: "Some small businesses are being told their costs are going to go up, even though they're exempted from the law" or stand to benefit from it.

I am a small business owner working within a large insurance agency. I have two employees and I provide benefits including medical insurance. Under our arrangement I currently pay 100% of the premiums. I have been able to do so because we are a healthy low risk and because my employees understand the value of the benefit and know that it is part of the overall compensation package.

I strongly object to the notion that I am exempted from the law. It is true I can drop coverage and not pay a penalty. But that would put my employees into exchanges where every dollar they have to spend in premiums is more than what they currently pay. My key employee, based on family income, wouldn't qualify for a subsidy. She (52) and her spouse (53/smoker) would be looking at a $15,000 pay cut. For this key employee I currently pay around $8,700 a year. Even if I gave her a raise by that amount it still costs her a ton of money out of pocket.

We will also see our premiums go up. Our insurance company has informed us that because of community rating we are looking at an increase of 50% or more. On top of this factor we also will pay a PCORI fee, a reinsurance fee, a risk adjustment fee, and a market share fee. In total these fees will represent roughly a 3% increase. Add to that we now must provide an array of additional benefits without limitations that we don't use nor need. Last, they will also charge us more because our industry code is a low risk one.  In total my guess is the costs will rise by close to 75%.

My premium increases are going to make it unaffordable to remain in business and dropping coverage simply shifts an enormous burden onto the people who help the business be successful. So, my question to President Obama and HHS is please explain how my business stands to benefit from PPACA?

Dumber and Dumberer

As the Exchange Countdown Clock slowly - inexorably - winds down, our attention turns to the eternal question: "what's next?"

Ostensibly, folks who plan on buying their new health insurance from one of the public Exchanges will turn to one of those new-fangled "Navigators" for help. After all, these folks are new to the insurance purchasing process, and need highly trained folks brimming with integrity and advanced insurance knowledge.

Or maybe not:

"At a private briefing with federal officials last month, committee aides say they were told there would be no criminal background checks for navigators or requirements that they hold a high-school diploma"

Contrast this to actual licensed insurance agents. Here in Ohio (and I imagine these requirements are fairly universal across the other 57 states) one must have (at least) a high school diploma (or equivalent), take 40 hours of pre-licensing training, pass a rigorous licensing exam with a minimum of 70% correct answer, and complete over 20 hours of Continuing Education every two years.

Now who would you trust with your financial and personal information, let alone to help guide you to an informed purchasing decision?

Yeah, thought so.

PCIP Could Save the World

or at least the US Private Insurance system. It is an old rule of thumb that 20% of your population accounts for 80% of your claims. Hospitals account for 50% of all spending and most of the excessive cost and profit.

PCIP found this out when they blew through their allotted 5 billion to quickly. Being from the Government and always looking to help they had a very effective solution;

"The federal PCIP program run by the U.S. Department of Health and Human Services (HHS) will set most reimbursement levels at just 100 percent of the Medicare reimbursement rates, officials said"

For doctors this might be a slight haircut but for large hospitals, the ones racking up large bills, used to getting 300-400% of Medicare, or more, this will be noticeable.

If the Government was truly interested in being useful they would provide catastrophic insurance to reign in hospital spending and leave all the day to day care and the other 80% of the population alone. This would immediately make insurance affordable for the majority of the country which would likewise drop the percentage uninsured. It would also do so without all the other intrusive programs and requirements of the ACA.