Tuesday, May 23, 2017

ACA Anecdata, anti-Fallon Style

We've been hearing a lot of stories lately from folks who ostensibly benefited from ObamaCare, but what about those "left behind?" Surely their lives matter, too?

"My husband would’ve died with Obamacare ... In April of 2008, my husband, Doug, suffered a massive heart attack."

To be sure, this could have happened in 2017, as well. But that it happened in '08 was auspicious:

"Doctors and nurses worked through the night to get Doug’s heart pumping ... That was just step one in a long medical process."

Okay, Henry, we get it, a medical miracle happened, and the family's insurance did what it was designed to do: shielded them from financial ruin.

So what?

Here's what:

"Had Obamacare been the law of the land in early 2008, my husband probably would’ve died. And even if he didn’t, we probably would’ve had thousands and thousands of more dollars in medical expenses than we did."

How does she know this?

"[P]ost-Obamacare, the ongoing health needs of my husband cost thousands of dollars more in deductibles and copays than we ever paid in the freer market."


Pre-Existing Tuesday Morning

Many pixels have been spilled about how horrible it would be for those with per-existing conditions were ObamaCare to be repealed. There may or may not be much merit in that argument, but it neglects to address a more fundamental question:

How has ObamaCare been for those with these conditions?

To hear proponents tell it, O'Care has been a godsend for those with serious pre-existing conditions, offering a much improved experience vice pre-ACA days. But is this really true?

Well, we already know that O'Care has an actual body count, but is that a string enough argument agin it, at least insofar as those pesky pre-ex situations are concerned?

Turns out, not so much.

First, H H Manning alerts us to this excellent piece from Linda Gorman (director of health care policy at the Independence Institute, a free market think tank based in Denver):

"ObamaCare has failed patients with pre-existing conditions ... Estimates suggest that less than one percent of all people covered by private insurance have medically uninsurable conditions that would make them ineligible for medically underwritten coverage." [emphasis added]

Bingo. So we throw out the baby's insurance with the bath water. But that's not really the best part of this article. That would be this:

"The fact that so few policy makers have any actual experience with the individual insurance markets they want to regulate makes them particularly susceptible to snake oil salesmen with an agenda."

And I think "so few" is being far too generous: Congress boasts about a dozen or so doctors, yet there seems to be exactly zero insurance agents. Now, I don't believe that it's strictly necessary that only insurance agents get to vote on insurance-related matters (in that case, there was ever only 1 person who could have voted on NASA). But I do think it speaks volumes about the fact that no one there has actually been in the trenches, sitting down with moms and dad's and business owners, and thus able to offer insights and solutions that might actually, you know, work.

And by the way, if you still think that ObamaCare has been such a panacea for those very few uninsurables, well, Dean Clancy tips us to this insightful post from uber-wonk John Goodman, who actually co-wrote it with one of those aforementioned insurance agents:

"Obamacare’s destruction of the individual health insurance market has done enormous damage to the lives and finances of millions of people who  purchase their own insurance."

Go on...

"Mandated health coverage is now the second most expensive item in many household budgets  ... only about 10 percent of them were previously uninsured"

So, fewer carriers, more expense, very few first-time buyers.

Sure smells like #Winning, no?

Monday, May 22, 2017

1,000 Words on Single Payer

Graphically illustrated:

[click to embiggen]

[Courtesy FoIB Allison B]

A Risky Climb, Covered

[Courtesy Beazly A&H]

Friday, May 19, 2017

Odds & Ends

Last time we discussed medical tourism, it was to lament the increasing price of financing it:

"The cost of international private medical insurance is climbing globally, with an inflation rate of 9.2 percent reported for 2016."

Now FoIB Holly R tips us that a popular tourist destination has gotten serious about offering reasonably priced care:

"Jamaica, like other developing nations before it, is trying to boost its economy by wooing “medical tourists” to fly in for an inexpensive knee replacement or nose job."

No word on whether that includes complimentary Red Stripes.

From the Two Steps Back Department:

"Health insurance gains stalled last year ... 28.6 million people were uninsured last year, unchanged from 2015"

Wait a darned minute there, fella!

Weren't we told - repeatedly - that ObamaCare was going to ensure that everyone would have health insurance? In fact, it requires that they do.

How to square this circle?

And further proof, as if it's needed, that the push to insure everyone has bottomed out, FoIB Jeff M alerts us that:

"Blue Cross and Blue Shield of North Carolina has confirmed it is laying off 165 customer service representatives."

As we've previously reported, Tar Heel State BX is the only game in town, er, state. And, as Jeff notes, "if you don't have much b usiness, or competition, you don't really need lots of folks in customer service."

After all, where are they gonna go?

Thursday, May 18, 2017

#ACAWinning Update

■ Remember when we were told, over and over again, how ObamaCare would "cure" the problem of so many uninsured Americans? And that it was "for the children?"

Turns out - and you'll want to sit down for this - not so much:

"The percentage of Americans under 65 who had private health coverage fell in 2016, and the percentage of low-income children who had no health coverage at all rose sharply."

That's right: people lost their health insurance as a direct result of the ACA. Of course, their lives don't matter.

On the other hand, a lot of previously-insured middle income folks with private health insurance lost both: adults earning 100-200% of the FPL saw their private insurance go away, replaced with Medicaid.

Oh, and this line:

"That reduced their uninsured rate to 23.2%, from 24.1%"

Is garbage: Medicaid insurance.

One reason for the slowdown may well be agents (such as yours truly) who've decided to sit out Open Enrollment altogether. Now, the Rocket Surgeons in DC© seem to have figured out that most folks don't buy insurance, they're sold it. So the Feds are allowing "web broker entities that meet CMS data security standards" to enroll folks directly, bypassing the notorious 404Care.gov security sinkhole.

Unfortunately. our good friend Allison Bell, in a rare misstep, gets it completely wrong:

"[H]ealth insurance agents and brokers may get to play a much bigger role in selling exchange plan coverage."

Um, no:

"web broker entities" "health insurance agents and brokers" This is a direct hit on agents in favor of large, faceless web brokerage outfits.


Simply Irresistible

Blogging on the latest from the DC Rocket Surgeons©. Effective mid-June, new rules from the folks at CMS go into effect, two of which stand out as (unintentionally?) hilarious.

First, the issue of "Guaranteed Availability;" according to our friends at Cornerstone:

"CMS is changing its interpretation of the guaranteed availability requirement to allow insurers to apply a premium payment to an individual’s past debt owed for coverage from the prior 12 months before applying the payment toward a new enrollment."

This is in response to "anecdotal examples" of folks gaming the system by paying a few months' premiums and then "letting it ride." The upshot was that untold numbers of folks were able to then hop back on board during the next Open Enrollment with zero consequence.

Weird that no one thought of this before....

The second change that caught my eye was changes the bureauweenies are making to "give insurers greater flexibility in creating lower cost plans, in an effort to attract younger and healthier enrollees." They're called "Actuarial Value Requirements," and they're not exactly new to regular readers.
Yeah, good luck with that fellas. ProTip: it's not the plans, it's the EHB's and lack of underwriting. Until you can get to truly catastrophic-type plans, you're merely rearranging deck chairs.

But DC's gonna DC.

A *Yuuuge* Health Wonk Review

Our favorite Health Care Economist, Jason Shafrin, makes his hosting debut with this week's round-up of health care punditry, from Repeal/Replace/Refresh to swamp-draining, it's just simply the best, believe me.

Wednesday, May 17, 2017

High Risk Pools, a lousy idea...

So, as Congress talks about bringing back high-risk pools, I thought people should see what one looks like.  Here's a link to California's 2010 version...


Key Highlights:
  $75,000 Annual Max
  $750,000 Lifetime Maximum
  Limited number of spots for potential insureds, with substantial waiting lists

In 2010 in California, normal underwritten policies had no dollar benefit caps, could not be individually repriced because of adverse health events, could not be cancelled except for non-payment and were substantially cheaper.

Politely speaking, high-risk plans were better than nothing, but not by much.  You get seriously ill and they were pretty f'ing worthless. 

My suggestion?  Keep everything in place as-is, and add  Federally funded, taxpayer supported, reinsurance for big ($1M?) claims.  The risk pool idea was tried and failed.


SHOP's a Flop

CMS is changing the way small businesses can buy insurance through SHOP Exchanges. Left leaning health care "reporters" are crying foul claiming that the Trump Administation is trying to dismantle or "effectively end" the program. While these claims are nothing more than fake news aimed at placing blame on the opposition, maybe the government should take a look at killing it.

The SHOP Exchange was created to provide employers with less than 50 employees an easy to use process to enroll employees in group health insurance. The big carrot at the end what that if you had a small number of low wage employees there was a chance you could receive a tax credit. It was such a great option for small businesses that CBO estimated SHOP's would have 4,600,000 people covered by now.

If only it was as "simple" as it sounds. Turns out SHOP enrollment is extremely cumbersome, there are less plan options compared to the off exchange market, and that tax credit, well it hasn't been worthwhile for most employers. Plus it's only available for a maximum of two years.

Couple that with Obama screwing his own law by allowing Grandmothered Plans and what you've got is a high cost, low volume platform destined to fail.

The Federal SHOP has a paltry 38,749 people covered. State based SHOP exchanges have fared better with about 193,949 enrolled. While enrollment is higher, part of that comes from the DC health link which forces employers to use the chassis. As of 2017  64,805 where enrolled through DC Link. Of this amount Congress and staffers represent about 11,000 people. A second state, Vermont, also forces employers to use their exchange and has 46,099 enrolled.

So when not forced or illegally enrolled (Congress is NOT a small business) total enrollment into SHOP exchanges is 121,794.

Less than 3% of projected enrollment. That is why SHOP should be dropped.

Missed it by *THAT* much

As regular readers know, I'm a big fan of Health Savings Accounts (HSA's). And of course I'm far from alone; in fact, uber-wonk Michael Cannon (among others) has been proposing expanding their availability as a (partial?) cure for ObamaCare. Unfortunately, these plans may best be characterized as "necessary, but insufficient."


Here's an example from the Dallas News, from a recent article titled "This little health care funding mechanism could solve our big crisis." In it, Kevin Simmons (an economics professor at Austin College) walks us through the political processes that have brought us to where we sit now, and then segues to how HSA's could help:

"One provision could create common ground: health saving accounts. The idea is simple; you deposit money tax-free into an account and that money is available for medical expenses ... use of HSAs could be opened up to people on all insurance plans, not just those with high deductibles."


First, Kevin, I applaud your willingness to explore new economic models, and am glad to have you aboard the "HSA wagon." But (and you just knew there'd be a "but"): nowhere in that 700+ word article do we see the term "catastrophic." Now, why is that important? Well, the premise of HSA's is that one has enough cash left over after having paid one's insurance premium (or not; more on that in a moment) to actually have shekels enough to contribute to the account. As long as we have to pay for birth control and maternity (and all the other EHB nonsense, let alone pre-ex coverage and no underwriting), very few people are actually in this boat. So you're proposing to expand something most folks can't afford in the first place.

(By the by, why not allow DPC subscription fees to be HSA-eligible?)

And riddle me this: why does the HSA have to be tied to owning any insurance plan? What if I'd like to completely self-insure? No one seems to be asking (let alone answering) that one.

If I sound frustrated, it's because I am: I would really like to see either full repeal or, failing that, some kind of carve-out for truly catastrophic plans exempt from EHB's, etc. Such would be an acceptable start, anyway.

Okay, rant over.

(For now)

Tuesday, May 16, 2017

And then there was one, South Carolina style

[click to embiggen]

This Sceptered Isle - Part CDLIV

When politics has managed to exceed 51% of the decision-making in medical care:

"NHS nurses with dementia should be allowed to carry on working, according to the profession’s top body."

Apparently the Royal College of Nursing has already adopted this rule in its own staff, experienced no noticeable affect on its work, and now proposes to extend the concept to clinical patient care.

O Brave New World that hath such people in't.

Monday, May 15, 2017

Breaking: Premier is out‽ Premier is out‽

We recently reported that local hospital chain Premier Health and insurance giant United Healthcare had reached an impasse in their on-going negotiations to lock down a new contract:

"As of yesterday (April 30), folks with either individual or group medical plans from UHC are no longer able to receive services at Premier Health facilities at negotiated rates"

At the time, most of us were still hopeful that things would, as these things usually do, work out.

Alas, that's not going to be the case here (at least for a while). This just in from UHC:

"Premier Health Network Participation Not Renewed

We have an important update about our negotiations with Premier Health Network and their participation in our network. Premier has decided to not renew its participation for employer-sponsored, individual and Medicaid plans, which means its hospitals and physicians are no longer in-network for commercial and Medicaid health plans as of May 14, 2017."

As usual, cost was the driving factor, as Premier continues to be a leader (for certain values of "lead") in high-end health care pricing.

There is, however, some good news to be had:

■ They've "reached an agreement to extend Medicare Advantage plans for Premier facilities and physicians" through year's end, and

■ "Continuity of Care may be available to any individuals" undergoing certain kinds of care (eg oncological, etc) at Premier facilities at in-network pricing for a limited time.

As always, we'll keep our readers in the loop if/as things develop.

Coffee saves lives: It's science!

Last week, it was wine's propensity for reducing the risk of Alzheimer's. This week, we learn that our morning cuppa may have an even more profound effect on our lives. Namely, the saving thereof:

"You actually would die without your coffee, research says"

Now waitaminute there, Henry, that's a might bold statement to make (SWIDT?). Sure you can back it up, or is this just weak tea?

Well, since you insist on pressing the issue:

"Research the world over is confirming that drinking coffee keeps you alive ... To get the health benefits of coffee, you have to drink it like you mean it."

Just let that percolate a moment. What does "like you mean it" supposed to mean?


"Drinking three to five cups of coffee per day gives you a longer life"

And for us men-folk, "[t]hree cups of Italian-style espresso per day cuts the risk of prostate cancer in half."

So, 6+ cups a day to live a long, healthy life?

That just drips with irony.

1,000 words on health insurance

[Hat Tip: Healthcareonomics‏]

Friday, May 12, 2017

Hopeful Alzheimer's News

We last blogged on Alzheimer's treatments about a year or so ago, with this unlikely news:

"Maple syrup isn't just delicious, it could also cure Alzheimer's disease"

Blueberries made an appearance, too.

Fast forward to now, and we learn about promising research being done in Israel :

"A protein dubbed SIRT6 is almost completely absent in Alzheimer’s disease patients and this deficiency likely contributes to its onset"

Using mouse as human stand-ins, researchers are trying to lock this connection down.


RELATED: From the folks at PowerLine blog, we learn that:

"The brain scans showed the somms had developed thicker and more robust areas of the brain that deal with olfactory and memory response. In turn, the researchers concluded that studying wine might help lower the risk of Alzheimer’s disease."

It's science!

Thursday, May 11, 2017

Aetna out. Who’s still in? Anyone? Anyone?

Aetna blamed ‘marketplace structural issues’ that have led to health care co-op failures, exits by health insurers and a deteriorating risk pool leaving behind sicker, poorer people that lead to higher insurance rates.

It's not like Aetna hasn't been warning of doing exactly this, and for pretty much the same reasons, for months - many months, years even.   

As just one example of numerous media articles still on the web, here's an article more than a year old:

In this article, the author cites Aetna's view that State Obamacare Exchanges "set standard deductibles, copays and other benefits, forcing insurers to compete more directly on price".

So let’s follow the logic.

In order to compete on price, scale is essential. “Scale” is business shorthand that means reducing unit cost by spreading overall costs over a larger base.  Aetna needed a much larger base than its own individual policy enrollment in Obamacare Exchanges. To achieve such scale, Aetna went looking for a willing merger partner. That willing partner turned out to be Humana. When the government blocked that path there was no way forward for Aetna to achieve the scale it still believes it needs to compete on price. That is, without the additional Humana enrollment Aetna alone cannot grow in any market by enough to achieve the competitive pricing it needs. Worse, uncompetitive prices mean Aetna will inevitably lose the enrollment it has, losing gobs of money along the way, even in places where it may have earned small margins up to now.  Aetna has decided its only realistic alternative is to withdraw completely from Obamacare Exchanges.

BTW, Aetna’s current Obamacare Exchange enrollment is about 255,000, down from a peak of just under 1 million when Aetna participated in 15 States.  By contrast, Aetna reports total enrollment for medical coverage overall of just over 23 million Americans, virtually all group plans.

Also keep in mind this wider perspective: the essence of a functioning economy is the meeting of willing buyers and willing sellers. Under Obamacare, the government created unwilling sellers - Aetna is not the only insurer bailing out - and unwilling buyers, too.  The government has meanwhile done virtually nothing to address the underlying problem all along - the high cost of delivering medical care in the US.  How could the People of Smart like Jonathan Gruber, Ezekiel Emanuel, and The Fair Nancy Pelosi ever allow this to happen?

That's my story, and I'm stickin' to it.

One Step Forward, Two Steps Back

BlueCross BlueShield of Tennessee is planning to restore individual coverage in Knoxville, after having withdrawn from offering "individual coverage under the health care exchange market in 2017 in Tennessee's three biggest markets."

Of course, we have no idea how much these plans will actually end up costing, nor for how long they'll continue to offer this coverage. Still, a little bit of good news for a change.

Which is offset by Aetna's announcement that "it will not be participating in any Obamacare exchanges in 2018." And who can blame them; they lost almost three-quarters of a billion dollars between 2016 and 2016, and are on track to drop another $200 million this year "despite a significant reduction in membership," according to company spokescritter T.J. Crawford.

Um, say that again?

"Despite a significant reduction in membership"

Um, TJ? Do you think that maybe, just maybe, that needs to be recast as "Because of a significant reduction in membership?" We call this adverse selection; that is, when rates continue to decrease by 3000% skyrocket, healthier people tend to drop off, while the sickest continue to cling bitterly to their coverage at pretty much any cost.

It's really not that complicated.

Mazel tov to The 40

So Forbes has published its list of the 40 insurance companies recognized as best employers. These include:

■ Wellmark Blue Cross and Blue Shield, CareFirst Blue Cross Blue Shield, Blue Cross & Blue Shield of Massachusetts, Blue Cross & Blue Shield of Michigan, and Anthem BX (really!)

■ The Standard (really top-notch DI carrier)

■ Cincinnati Insurance (our primary life and P&C carrier)

■ Humana

■ MassMutual (really strong DI and LTCi carrier)

And, of course quite a few more (see comments at the link for expanded list).

[Hat Tip: LexisNexis Insurance]

Tuesday, May 09, 2017


Three questions:
  1. Do you know how Obamacare funds the operation of insurance exchanges?
  2. Do you know how the Obamacare tax on insurers is paid? 
  3. Do you know how Obamacare "limits" the profits of insurers?
The answer is the title of this post - percentages. 

Next question. Do you know what is wrong with percentages in Obamacare? 

Percentages in Obamacare hit the pocketbooks of consumers. What I mean is because of percentages you pay more for insurance - and you will continue to do so under the way Obamacare is set up. It's a sleight of hand used by government to make you think you are getting favorable treatment when reality is you are actually getting royally screwed.

Here's how the percentages work. Under Obamacare's exchanges there is a 3.5% user fee on premiums for all plans. This user fee is to help keep up a robust, easy to navigate website where you can compare plans and purchase insurance. Obamacare's Health Insurer Tax (HIT) is paid by insurers and ranges from 3% to 5% of premiums based on an insurance company market share. Obamacare's Minimum Loss Ratio limits insurance companies by a rule that they have to pay 80% (85% in large employer market) of their premiums on medical costs and can only retain 20% for whatever they want which theoretically minimizes profits.

If all you had read was the previous paragraph you would likely believe that Obamacare protects consumers from greedy insurance companies. But, when you peel back the layers of the onion what you will find will make you want to cry. The tears come because of premiums.

Think about your premiums. How much have they gone up since Obamacare passed? Throw aside the feel good subsidies. The true premiums are still paid to insurers. It's this layer of the onion that matters most. 

Rising costs of insurance in a percentage world are problematic. Especially when the percentage side has no increase in costs of doing business. Look at it this way, the website for Obamacare is set. The number of people using the site has been slightly up (close to flat) the last couple of years. Insurer costs aren't increasing. They aren't adding employees or increasing wages to existing employees at a high rate. In fact, many insurers have downsized. As for the Health Insurance Tax, we all know companies don't pay taxes, consumers do

The point is, as costs increase and these percentages stay the same, more of your premiums go to insurers and the government. 

Take this data from an eHealth report on average Obamacare premiums. Every year costs have gone up. Since 2013 what is paid by consumers for the user fee, HIT, and retained by insurance companies has jumped by 99%. The average amount of premium per consumer to fund these three things has gone from $650 per year up to $1297 per year.

Numbers don't lie. You are paying big time to the government and health insurers for taxes, fees, and margins. None of these things pay a dime for your actual health care. That is what I consider one bad raw onion.

Be careful what you wish for

A lot of folks seem to think that the US needs a government-run, single payer health care system. They point to other countries as examples (the fact that they haven't figured out how to control costs, either, notwithstanding). But of course we already have such a system here; how's that working out?
Turns out, not so great:

"More than 100 veterans died waiting for care at Los Angeles VA hospital"

But yeah, let's expand that wonderful system.

Monday, May 08, 2017

Singing the Blues in Maryland

Amid all of the spectacle taking place on the floor of the House last week, Maryland announced initial rate increases for 2018 Obamacare plans. The increases are staggering - especially for the leader in market share.

CareFirst, the Blue carrier, has been the overwhelming choice for Marylander's who have signed up for insurance through the state run marketplace. In 2014 they insured roughly 94% of enrollees. That number has decreased to 80% in 2015 then to 68% in 2016.

So how bad is it at CareFirst? The rate increases tell it all. Back in June of 2015 CareFirst was being lambasted by media including the Baltimore Sun who criticized the insurer for "rate increases that are out of line with reality." These rate increases ranged from 19% to 26%.

That was a drop in the bucket compared to the 2017 increases for the HMO at 23.7% and the PPO at 31.4%. But, those were expected. We were told three days ago by Jon Jon Gruber this was a one time blip on the radar as carriers had underpriced the first two years and needed a rate correction.

So what is in store for 2018? CareFirst has announced the following request for rate increases:

HMO: 50.4%
PPO: 58.8%

Finally, with less market share and now being priced in line with reality CareFirst is ready to roll.

Monday Roundup

■ FoIB Dr John Goodman tips us that if you're an Anthem insured in The Show-Me State, best think twice before using the ER for anything less than a real emergency:

"If you have a minor health problem, don't expect Anthem to pay for your ER visit ... Starting this summer, if a Missourian with Anthem insurance shows up at an emergency room with a minor ailment such as a common cold that could have been treated at an urgent care center, the patient will be on the hook for the entire bill."

On its face, I see nothing wrong with this: after all, the ER should be for truly dangerous health conditions. It'll be interesting to see how this plays out.

■ Last we looked, Genworth was being courted by China's Oceanwide insurance behemoth. Now there's more good news for the carrier:

"Genworth Financial Inc. startled investors Tuesday with good earnings news ... Earnings were about 20% higher than what Wall Street securities analysts had predicted, and revenue was 1.5% higher."

Of course, some (a lot?) of that came on the backs of its LTCi clients who ate some major rate increases:

"The company has been depending heavily on increases in premiums for the consumers who already have its LTCI policies to boost revenue."

But for how long can they continue going to this well?

■ And speaking of Anthem, got this in email recently:

"Provider Care Management Solutions or PCMS is a web-based program that changes the way information is shared among doctors, hospitals and specialists across the country. It makes health care more efficient by cutting out waste and getting the right information to doctors, when they need it."

They've even included a nifty video explaining this new program.