Monday, August 21, 2017

Speaking of Pro's

A month or so ago, we noted that "it would suck to be in Nevada;" this in light of the fact that there will be so few insurance options available there this coming plan year. Well, our friend Rich W alerts us to this (heart-)breaking story. Turns out, one demographic is particularly hard-hit:

"Nevada sex workers fear loss of Obamacare ... Her six-figure earnings mean she cannot get government insurance for the poor. Her status as an independent contractor means she does not get insurance from an employer. Her profession is another complication."

This is the sad story of Alice Little, who makes too much to qualify for a subsidy, is self-employed so no group plan or employer contribution. Oh yeah: she's a card carrying member of the world's oldest profession.

The good news is that she's founded a support group called Hookers for Healthcare. Seems like they have another natural constituency to tap, as well.

Which brings us to our old friend Herr Gruber got caught with his hands in the till:

"Vermont’s Attorney General has settled the state’s claims of fraud against Jonathan Gruber"

Poor Jon is out as a "taxpayer-funded economic consultant for the state’s health care system;" he's also out any balance due him by The Green Mountain state.

One's actually more sympathetic to the gals up top.

Come fly with me, ObamaCare style

Some time ago (3 or so years, to be exact). FoIB Todd made this video, comparing aviation with the still nascent ObamaCare. It's eerily prescient, and absolutely spot on:

Friday, August 18, 2017

About that Obamacare Poster Child

After two years of the media and government gushing over their success, Obamacare darling Molina is having a rough 2017. How rough? Well...

  • In February Molina announced losses from the 4th quarter of 2016 to be $110 million. They also report a profit of $52 million. This is a huge fall from their 2015 record profits of $143 million coupled with 2014 profits of $62 million.
  • On May 2nd they fired CEO J. Mario Molina and CFO John Molina. The move came as a surprise and the board claimed it was due to poor financial performance.
  • The following day they announced 1st quarter 2017 earnings that actually beat Wall Street expectations. Coupling this with the ouster of Brothers Molina and speculation began of a possible sale of the company.
  • On May 4th Mario Molina went on record suggesting that the board ousted him due to his political views. Mario Molina has been a vocal critic of President Trump and a significant supporter of the Democratic party contributing well over $70,000 to various campaigns and PAC's in 2016 alone. Shoot, he gave the Hillary Victory Fund $33,400! Talk about lighting money on fire. But, I digress.
  • On May 15th the board voted to retain Brothers Molina on their board of directors. This is an interesting twist based on their abrupt departure.
  • The latest, on August 2nd, Molina announces a 2nd quarter of 2017 loss of $230 million. They also announced that they will be leaving individual markets in two states - Wisconsin and Utah. Piling on, they stated that 2018 rates will increase on average of 30% (I'm assuimg CSR's will be funded).
The question is, why is this 180 degree turn happening?

Back in 2013 Molina insured nearly 2 million Medicaid patients in 9 states. Managing Medicaid was their core business but they saw a need within the individual market. The need was to serve the low income population that Molina felt big insurers weren't interested in. They went on a hiring frenzy to help with their enrollment efforts as they entered the new individual Obamacare market. Molina's individual market offerings included very narrow networks, limited geographic availability, low premiums, and razor thin profit margins.

Membership has grown in all of their business. Medicaid, their core business, jumped approximately 1.7 million new members from 2014 to the end of 2016. Almost half (673,000) came from Medicaid Expansion. For their new endeavor into the individual insurance market, at the end of 2014 they had 15,000 individual customers. By the end of 2015 that number had exploded to 205,000 then catapulting to 526,000 at the end of 2016.

Profitability for Molina in the early Obamacare years is likely attributed to Medicaid growth with their individual Marketplace participation being limited. This is where the tide has changed. Over the last two years Molina's growth in Medicaid has slowed while growth in their individual market has risen exponentially. This is the inverse of what is happening to overall markets. Medicaid has continued to accelerate and the individual market has flatlined.

With competition exiting the markets due to losses and uncertainty, this leaves Molina to take on the risk. It's well known that the higher risk population gravitated towards health plans that had broader networks. Molina thrived because of their limited networks where by not having major high cost specialty facilities in their network led to a healthier risk pool.

Molina's "competitive" advantage was tied to avoiding high dollar risks (adverse selection) and that advantage is now gone.

From the P&C Files: I have issues

As regular readers know, I tend to be a purist when it comes to insurance. So I've railed on medical necessity as regards health insurance; the whole point is risk management.

And specifically the concept of Frequency vs Severity.

For example, it's unlikely that any one person will contract cancer (frequency), but those who do face some pretty steep bills (severity).

Or, closer to home, what are the odds that a 9 month old puppy will need expensive (and multiple) knee surgery? Again, not often, but a true pain-in-the-checkbook.

One more thing: insurance is (or ought to be) more about covering the unexpected, which is why your auto policy doesn't pay for oil changes or new wiper blades.

On the other hand, birth control convenience items are generally bought fairly often, but at a very nominal cost, so: frequency, but not severity, so not really appropriate to insure.

But insurance has a cousin: warranties. Typically, one purchases these to cover things like dishwashers and refrigerators and the like. But again, these aren't insurance (notice they never use the words "risk" or "premium"). Nothing wrong with that, and I'm not aware of any company offering these plans that claim to be.

Wish I could say the same for the insurance industry.

Our longtime guru of all things P&C, Bill M, asked me the other day if I'd heard about the newest trend in his side of the biz: equipment breakdown and service line coverage.

The equipment breakdown rider "covers the perils of mechanical, electrical and pressure systems breakdown," such as A/C units, TV's, even kitchen appliances. And service line coverage is for coverage "provides protection against a leak, break, tear, rupture, collapse or arcing of a covered service line," such as water and sewer lines, even from ordinary wear and tear.

How in the wide world of sports are any of these insurable risks? Well, obviously, now they all are, which offends my sensibility as an insurance purist.

But now I want to add both of those to my own policy.

Go figure.

Interested for yourself? As always, ask your agent (or seek out a local, independent one).

Thursday, August 17, 2017

Health Wonk Review is up

Peggy Salvatore hosts the jam-packed Lulls of Summer edition. From the philosophical to the urgent, you'll be glad you stopped by.

Batting Averages, The Weather, Businesses & Obamacare Co-ops

In baseball being successful 3 out of 10 times at the plate will likely get you into the Hall of Fame.

A meteorologist forecast projecting out 10 days is right about 40% of the time

The Farmers Almanac claims a success rate of 80%.

Start up businesses - according to the SBA - make it beyond the first year 50% of the time

According to a Harvard study, new businesses using venture capital succeed 25% of the time.

So what about those non-profit, government funded, competition enhancing, Obamacare Co-ops? You know, the newly formed "insurance companies" that would create more competition and force the big bad insurance industry to play fair and quit price gouging with high premiums to pay fat cat CEO's and shareholders fists full of money.

Well, they are batting a whopping .174 - below the Mendoza Line. Of the 23 co-ops that actually got off the ground (there were 24 but we won't count the Vermont debacle) as of 2018 only 4 will remain. One of them, Montana, took measures last year to halt enrollment amid concerns they wouldn't be able to meet their financial obligations.

What's worse than the 17% success rate? That would be the "venture capital" we (taxpayers) gave Co-ops for start up funds. Of the $2.4 billion low/no interest loans given, the four remaining Co-ops received $402 million - a loss of close to $2 billion.

Yet government wonders why we don't trust them to be good stewards of our hard earned money.

Wednesday, August 16, 2017

Mid-Week Linkpourri

From FoIB Holly R we learn about a "start-up called Aledade [that] has figured out a way of reducing healthcare costs while improving care." Founded by the "national coordinator for health information technology at the [HHS] in the Obama administration," the firm is focused on reducing the cost of healthcare (and, hopefully, health insurance).


A pair of items courtesy of FoIB Rich W. First up, individual plan enrollment continues to crater:

Next, Rich wonders who remembers Obama's promise that the ACA would entail no tax increases. Turns out, get this, that was a lie. He provides a link to "newly imposed Obamacare tax per person by state."


Tuesday, August 15, 2017

Death be not proud (But....)

I'm beginning to sense a theme from the medical front these days. If it's not ObamaCare's death toll, it's a culture that seems not just "okay" with assisted suicide but apparently insists on it.

Wow, Henry, that's quite a claim there, care to back it up?

Sure. (Literally) Ripped from the headlines:

"California Hospital Sued for Refusing to Assist Suicide"

The patient eventually died of cancer, and now her children are suing the medical facility which treated her because it "conceal[ed] its oncologists’ decision not to provide life-ending drugs to patients who ask for them."


I'm assuming they also deny diet pills to anorexics who request them, as well.

Meantime, FoIB Holly R alerts us that the Much Vaunted National Health System© apparently has no such problem reducing its patient load:

"One-Third Of Life Support Patients Die Under British Health Care System."


Turns out that "free" health "care" is absolutely worth every penny, er, farthing. So, if you're on a vent or other life support system provided by the MVNHS©, best make sure your affairs are all in order.

The sooner the better, natch.

But wait, there's more good news (well, for certain values of "good"):

"CBS Reports Iceland Has 'Virtually Eliminated' Down Syndrome with Abortion"

Well first, as Patricia Heaton points out, killing unborn Downs babies isn't eliminating "Downs," it's eliminating babies:

Notice that the trend, here and abroad, is to ration care by rationing life.

Pretty rational, I guess.

Scary, too, no?

[Hat Tip for CA hospital story: The Political Hat]

Monday, August 14, 2017

Better than a crystal ball

From 5 years ago, predicting the impact of ObamaCare. Eerily prescient:

[Hat Tip: Co-blogger Bob V]

Friday, August 11, 2017

A *Really* Big Case (of fraud)

We seem to be on something of a life insurance fraud roll here. Almost exactly a month ago we reported on the case of a rocket surgeon greedy wife's efforts to collect on her husband's life insurance policy after arranging his premature demise (spoiler alert: she failed).

The case now at hand is particularly intriguing; at first, I was somewhat dumbfounded as to how the insurer could have been so easily duped, but as the story unfolded, it got even weirder. And that this all took place about a half hour away from me added a sense of the macabre.

A brief underwriting refresher: when applying for life insurance (especially anything over $100,000) one is required to undergo (at least) some sort of physical exam. Depending on the amount at risk, this can range from simple blood and urine tests to EKG's and stress tests. In this case, West Coast Life was set to be on the hook for just shy of $3 million, so of course the medical underwriting would be vigorous.There's another angle (financial) but we'll elide over this for purposes of this post.

Here's where it begins to get weird: the application was apparently written in Ohio, but the applicant chose to have the exam done in Texas. I'm thinking that right there's a red flag, but apparently WCL wasn't bothered by it (or perhaps, they became retrospectively concerned). In the event, a person claiming to be the applicant shows up, all 176 pounds of her.

Which would not necessarily be weird in and of itself, but the person who actually died clocked in at almost 400 pounds [ed: Hey. it could happen! Spend a few days at the Golden Corral and Bob's your uncle]. Kind of a clue. The fact that the applicant indicated no substantial health history, and yet was dead within a few short years of (presumably) natural causes was likely another.

And so now the family of the insured is being charged with life insurance fraud; one presumes a lawsuit on behalf of West Coast Life will follow directly.

[Hat Tip: FoIB Holly R]

Thursday, August 10, 2017

Something Different

So here's a question: you're in your 50's or 60's, retired (or about to be), and looking around wondering "what's next?"

For some folks it's travel, for others it's gardening or bucket lists.

For some, though, it's time for a second (or third, or whatever) career. But how to find "just the right one?"

Well, there's a cool new answer:

Check it out.

[Hat Tip: FoIB Mark G]

Wednesday, August 09, 2017

From the P&C Files: Hopefully not a client

Doing it wrong, defined:

Baby Charlie Redux

As we noted regarding the tragic case of little Charlie Gard, government-run health "care" really isn't about the care at all: it's actually all about control:

"Charlie's parents weren't asking for special care, or special funding, or that the Much Vaunted National Health System© (because ultimately, they own this) do anything more than get out of the way"

Now, another young Briton's health is in danger, this time a teenaged dancer participating in Britain's Got Talent, with a severe spinal condition:

"15-year-old Julia Carlile, who appeared on Cowell’s show "Britain’s Got Talent" along with her interpretive dance group ... she was going to need corrective surgery shortly after the performances on the show."

Problem is, the only treatment allowed by the Much Vaunted National Health System© would require steel rods that would effectively end her just-now-burgeoning dance career.

Enter Simon Cowell (really!), who has graciously donated almost a quarter of a million dollars to pay for her surgery - in the US.

That's right:

"Carlile opted for a medical procedure only offered in the United States called vertebral body tethering"

This procedure eschews rods for screws, promising her greater range of motion and a real shot at resuming her dancing. It's not even *offered* by the Much Vaunted National Health System© (or that other beacon of healthcare brilliance, Cuba).

Good thing she wasn't in hospital (as they say Across the Pond), else the rocket surgeons running the MVNHS© may well have locked her down, too.

Tuesday, August 08, 2017

Oblivious Carrier Tricks

This isn't really a big deal, but I sometimes wonder about Home Office Critters and whether they actually read what they write.

Case in point:

I'm currently working on a Retirement Income Disability plan quote for a physician (like this). So as I'm reading through one proposal (to be fair, not from the carrier in that link), I notice among the included benefits:

[click to embiggen]

Um, no you don't.


Evolution of Medical Tourism

It's been a while since we looked at medical tourism in-depth, although we did mention it yesterday when we noted that upwards of 60,000 Candians sought care outside that country's failing government-run health scheme.

And, perhaps more to the point, we reported in January that the "cost of international private medical insurance is climbing globally, with an inflation rate of 9.2 percent reported for 2016."

And, of course, the ACA has been steadily chipping away at physicians' incomes here at home.

Okay, Henry, very interesting, if disparate, items. What's your point?

Well, FoIB Dr Valerie Jones alerted us to this rapidly growing opportunity that uses virtual medical tourism to help boost actual physician income:

"This Startup Connects U.S. Doctors with Patients in China ... that deal in the domain of telemedicine, sometimes called telehealth, which uses technology to remotely connect doctors and patients otherwise separated by physical distance."

After all, what difference does it make if the patient is 10 miles away, or 6000? Other than the slight inconvenience of time-zone shifting, why not? And it's certainly a potential money-making powerhouse:

"Estimates on telemedicine’s market size vary  ... projects it will more than double from $25.53 billion in 2015 to $57.92 billion in 2020."

That's a lot of revenue for a few minutes on the phone (or Skype, etc).

Telehealth itself isn't all that new, but this application of it seems to be burgeoning. Definitely something to keep an eye on.

Monday, August 07, 2017

Breaking News from Our Neighbors to the North

CanuckCare© continues to auger in:

"“Free” Canadian healthcare is not free, according to a report released Tuesday ... a “typical Canadian family of four will pay $12,057 for health care in 2017—an increase of nearly 70 percent over the last 20 years.”

So how's that Single Payer system working out?

Still, that $12 large may be a bargain since it buys great care, right?

Turns out, not so much:

"[T]here is still a long waiting list for a host of operations, both routine and urgent."

And over 60,000 Canadians sought actual care outside the country last year.

But "free" (or, you know, not).

[Hat Tip: FoIB Holly R]

Thursday, August 03, 2017

P&C Files Update

Last Fall, we blogged on Kanye West's health issues, specifically as they applied to the cancellation of much of his concert tour schedule. In that post, we noted that Mr West had apparently purchased an insurance policy to cover that eventuality:

"[H]e's since cancelled the balance of his tour, at a cost of at least $30 million. That's a lot of scratch even for a successful musician, which is why he (reportedly) has an insurance policy that likely covers this kind of situation."

As it turns out, he did, in fact, make that purchase. And the story might have ended there, but for one small problem:

"Kanye West has filed a lawsuit claiming insurers failed to pay nearly $10 million for the singer's canceled Saint Pablo Tour last year."

As an aside, I'm curious about the rather substantial discrepancy between the $30 million loss cited in the original post, and the $10 million in dispute.

Nevertheless, this is an interesting case: it seems to turn on the definition of "accidental bodily injury or illness," which being hospitalized seems to pretty much qualify.

One wonders whether this will be settled out of court, or taken to trial. We'll keep you posted.

[Hat Tip: FoIB Jeff M]

Wednesday, August 02, 2017

The Creation of Obamacare's Individual Market Mess

It has been four years since insurers submitted their initial rates to buy market share in Obamacare's individual market. Back then insurers were using assumptions that the segment would grow through government forcing people to purchase their product, existing policyholders coming over from "crappy" insurance plans, the promise of enforcing the rules, huge transfers of funds from competitors, and large sums from taxpayer funded subsidies.

Nevermind the ginormous turd of a website, the bigger problems occurred when those in power issued major changes - literally weeks into the first open enrollment. Some problems have continued because of a lack of enforcement. Others have come from bipartisan Congressional changes that were signed by President Obama.

The first was a reprieve for those already insured who found out that "if they liked their plan" they couldn't keep it. These transitional plans (Grandmothered) kept a large number of healthy folks out of the Obamacare markets when HHS issued a rule allowing people to retain their medically underwritten insurance.

The second problem was the expansion of - but no policing of - "hardship waivers". There are a plethora of waivers people can take advantage of. Some are legit. Others, not-so-much. The most egregious (IMO) is the exemption for Christian Health Care Sharing Ministries (HCSM). HCSM's aren't insurance products. They don't have mandated benefits nor do these Ministries pay in to the Obamacare taxes and fees. Don't get me wrong, if it's the right fit for a person they should look at it as an alternative. My objection is the double standard that Obamacare considers this "good" but a mini-med/limited benefit plan is considered crap.

Lack of enforcement continues to be a significant contributor. The primary culprit on the enforcement front stems from Special Enrollment Periods (SEP). While these have been tightened under the Trump Administration, the first three years under Obama was a free-for-all. In discussions with insurance company underwriters and executives, all had a similar response to how HHS policed SEP's. The short answer was, they didn't. As one insurer put it:

"They (Obama's HHS) rubber stamped everything. Politically they had to. Think of it this way. If someone was without insurance in January then was diagnosed with cancer in March they would have to wait until January of the following year to obtain coverage. These type of situations happen more often than you know. Imagine the backlash if people were diagnosed with major health conditions then were denied insurance due to Obamacare's own rules? The simple way to make it work was to allow people in, then place blame on insurers when rates went up."

A final problem is revenues. "Not one dime to the deficit" was BS. When you have an initial CBO score that uses 10 years of revenues but only 6 years of expenses and it barely is at breakeven we know it won't be true. Making matters worse, the expenses continue to exceeded expectations. The bending of the cost curve is going in the wrong direction. Instead of shoring up the costly overruns Congress does the opposite - cuts revenues. Look at this list of changes to Obamacare that are causing the fiscal crisis to rise:

Every one of these revenue cuts had bipartisan support.

There are lots of nails in the coffin of the individual health insurance market. Many come from the sledgehammers that Obama's administration pounded. Some have come from a Republican controlled Congress.

Both sides continue to point fingers. Which brings me to something I was told as a young child. When you point a finger at someone remember that three fingers are pointing at you.

Tuesday, August 01, 2017

CongressCare: A Reminder [UPDATED]

One of the issues that's just now coming into view is just how sneaky ObamaCare-enablers have been in exempting themselves from its disastrous effects.

And which enablers are those, you may be wondering?

That would be Congress, which has been (illegally) benefiting from the law's small group exemption. Last I looked, there were 535 members CongressCritter (plus various support staff). And yet, we have this (courtesy of Phil Kerpen):

[click to embiggen]


UPDATE: Meanwhile, the Golden State's fine citizens have this to look forward to:

"Anthem Blue Cross is pulling out of 16 of 19 regions in California's individual market next year."

And that apparently apples to both on- and off-Exchange plans.

Ah, the Good Ol' Days...