Tuesday, October 31, 2006

Stupid Carrier Tricks: Umpteenth Edition

Sometimes, it seems as if we could populate this blog exclusively with stories of the dumb things insurance companies do. Of course, we’d have to change its name, but still.

Our latest installment in this “series” comes from Anthem Blue Cross/Shield, which has notified those of us who sell their group plans of their newest requirement: when submitting a Request for Proposal, we must now include the Federal ID number (EIN) of the group in question. This is idiotic.

Why, you may ask?

Well for a number of reasons:

First, employers are no less subject to identity theft than indiviuals, but Anthem’s not requiring us to submit those when getting a quote [ed: Hush! Don’t give ‘em any ideas!]. (And, yes, most of us do quote individual products on our own PC’s, but not all agents have this ability)

Second, and IMHO, more egregious, is that this effectively shuts out competition. How so? Simple: if one is not the incumbent agent, how likely is it that a prospect (who may be a referral, or a cold call, or a friend of a friend) will be likely to part with that information simply to obtain a quote? More likely, they’ll just call their existing agent and avoid the bother.

Third, what possible reason would a carrier have to require this information simply to provide a quote? It’s just one more example of heavy handed tactics that occur when a carrier dominates a given market.

Stupid, stupid, stupid.

(There, I feel better already!)

UPDATE: It gets dumber [ed: this is possible?]. Since there's no way for Anthem to verify the abovementioned EIN, why wouldn't agents simply make one up for quoting purposes? What's the worst that could happen? "Here's a new, sold case. Oh, I accidentally included an incorrect EIN with the quote request? Gee, I'm sorry."

Boo! (Gotcha!) And so does Grand Rounds

Dr E A Poe, or rather, Dr Michael Hebert, presents a spooky (and terrifyingly creative) 'Rounds, built around the classic "The Raven." There are a haunting number of posts, all worked into a poetic treat.
Hospital CEO (and blogger) Nick Jacobs poses some interesting (and controversial) thoughts on end-of-life healthcare issues. Scary, but serious.

Monday, October 30, 2006

Carnival Monday

LA Money Guy hosts this week's Carnival of Personal Finance. He's collected and categorized well over 60 posts. Alas, none include a summary.
If you pay bills (as some do), you probably have to restock your check supply from time to time. Five Cent Nickel has some tips on how to save money when doing so.

Wrong Number

I'm sorry. The provider you have reached is not in network.

If you would like to make a different choice, press 1.

If you want to stay with this provider, press 2.

If you are totally confused, press 3.

All other calls will be re-routed to voice mail where someone may eventually retrieve your message and attempt to call back during hours that are convenient to us.

Have you ever wanted to know what a 60-mile helicopter rescue costs?

Actually, I haven't.

The first helicopter brought a deputy from Chelan County. The second brought paramedics and a gurney, and I was instructed to board. One of the paramedics asked if I had good insurance.

"We'll see soon enough," I said prophetically.

Within an hour, I was in an emergency room in Central Washington Hospital in Wenatchee. X-rays showed a distal fracture of the left fibula. The rest of the story is inopportune and tiresome, but a week later I was home.

Then I got the invoice. Answer: $10,000.

$10,000 for a 60 mile helicopter ride isn't a bad deal. Some folks are billed that much for a 4 mile ride.

Jane and I are fortunate enough to be gainfully employed, and we're insured by Anthem through Jane's job at Virginia Tech. Anthem wants to pay $4,000.

Not getting too technical here, because, frankly, I'm still mystified, but I'd been caught in the particular anguish termed "out of network."

Fortunate. I hate that term. It implies folks get treated differently in life, not because of hard work but simply the luck of the draw.

Out of network. Hidden providers. Watch them get soaked.

It works like this. Insurance companies partner with providers (the network) and pay them a predetermined amount for various services. If you have treatment by a nonpartner, your insurance company will pay less, unless you have opted for a special "out of network" premium, which will pay an equal amount in case of emergency

Unless they have an HMO, that is not the way it works, but why quibble?

That out of network premium by the way is usually done by opting for an indemnity plan.

But here's the kicker: nonpartner providers can charge virtually anything they want, unburdened by predetermined fees. Because Anthem never partnered with my helicopter company, I got shafted

Most medical transport companies are not part of ANY network.

I had a client ask about ambulance coverage the other day. When I explained that the reimbursement will be less for ambulance transport and he may have some out of pocket he had the perfect solution.

"If I have a heart attack I will just drive myself to the hospital rather than paying for an ambulance."

Good choice. Just what we need. A guy having a heart attack driving his car.

The unfairness of this situation is clear and indicative of the mess we call today's American health insurance system. The overarching issue is whether we consider the miracle of modern medicine a birthright to all citizens or only those with the financial wherewithal to participate, which is fodder for another essay.

Uh-oh. Left wing alert.

But when Jane and I have spent upward of $25,000 on premiums over the last decade to protect us during such emergencies and we're only reimbursed at 40 cents on the dollar, something is wrong.

Where is the political will to fix it?

Political fix.

Yes, that's the ticket. The government does such a fantastic job of managing OUR money, let's just let them intervene even more.

Actually he had the answer already and mysteriously overlooked it. He could have paid EXTRA to have out of network cover. A political fix is not necessary. He just wants to blame someone else.

Sunday, October 29, 2006

5 Ways to Invest $1200

Got $1200 to invest? Here are some thoughts.

You can put it in a mutual fund and (hopefully) watch it grow.

You can put it in a CD.

You can buy lottery tickets.

Or you can make an investment in your future.

Five simple screening tests can detect things like early stage ovarian cancer, heart disease and abdominal aneurysms, but unless you're considered high risk, insurance probably won't pay for it.

Transvaginal Ultrasasound - $200 (skip this if you don't have a vagina).

"Ovarian cancer is difficult to diagnose, that's why there's been a real surge in tools for early detection which is what the transvaginal ultrasound is good for."

The Transvaginal Ultrasound cost $200. Doctors say it's just one of several tests worth paying for.

Expanded Cholesterol Testing - $100

At 28, Danny Luster didn't think he had to worry about heart disease, but he has a family history and he's a smoker. He took the advanced lipid test which showed his cholesterol was off the charts. Without taking cholesterol lowing medicine, he's at risk for having a major heart attack in his 30's

EBT Heart Scan - $300 - $500

"We have many cases of people coming in and they never had any problems with the heart and they come in with chest pains and they get a scan and they have a severe obstruction."

Spiral CT Scan - $300 - $500

This test is for smokers and former smokers over the age of 50. It can find lung cancer when it's as small as a grain of rice.

(Note: Survival rates for early detected lung cancer, about 80%. Most lung cancer is not discovered until stage 3 or 4 and the 5 year survival rate is less than 15%. Lung cancer kills more people each year than colon, breast & prostate cancer combined. Six out of 10 people diagnosed with lung cancer die in the first 12 months.)

Abdominal Aneurysm Scan - $350

About 7 percent of men over 60 have aneurysm disease, but few people realize they're have it or may be at risk.

So for $1200 you can take a chance on the lottery, or you can take a chance on living a long & healthy life.

Your choice.

Insurance Dispatch

This week, we revisit (and update) our Travel Advisory post on folks traveling to (and, of course, from) Israel.

And while you're at The Medical Blog Network, be sure to check out some of the other interesting columns.

Friday, October 27, 2006

Good News: Redux

We've had an overwhelming response to Bob's post (well over 100 comments), and for that we're most grateful to our talented and insightful IB readers.
One particularly industrious poster, John Fembup, has gone beyond the call, and analyzed both the survey we posted and its 2004 predecessor. Originally posted in the aforementioned comments section, John has graciously consented to post his analysis on the front page:
So now there are TWO Kaiser Family Foundation surveys on the table, one from 2004 and one from 2006. BTW, here is a link to the actual 2004 Kaiser survey.
At the risk of triggering another 100 comments [ed: fine with us!], here is what I’ve read so far.
1. The 2004 KFF survey reports people’s responses about quality across the US, and it also reports their responses about the quality of their OWN health care. These responses differ significantly. That is an obvious disconnect. Does the abc news summary mention that disconnect? No.
The percentage of people who reported in 2004 they were dissatisfied with their own health care is shown on page 15 of the 2004 survey, split by ethnic group. Note for backs and whites, the dissatisfaction with "own care" is very significantly LESS than the answer respondents gave for the nation as a whole. This is the identical pattern reported by KFF in 2006. [That is not the case for the 2004 latino sample which suggests an important area for further research; I don't yet find any mention in the KFF report] These difference constituted a huge disconnect in the 2006 KFF survey. The same disconnect was reported in the 2004 survey.
2. The 2004 KFF survey reported that "Four in ten say the quality of health care has 'gotten worse' in the past five years" [since 1999] and the same survey also reports "When asked in an open ended question to name the most important factor in determining the quality of health care patients receive, there is no general consensus"
So the survey reported .. . what, exactly? That people who don’t agree on what quality is, nevertheless believe that whatever it was had declined sharply over the prior 5 years? And where would they get that idea? From their OWN care? From personal knowledge? Clearly Not. (page 15 again). From where then? I think from the uninformative – worse, misleading - media reporting on health care.
3. Page 9 includes this:
"After being read the following definition of a serious medical error: 'Sometimes when people are ill and receive medical care, mistakes are made that result in serious harm, such as death, disability, or additional or prolonged treatment. These are called medical errors. Some of these errors are preventable, while others may not be.' About one in three say that they have experienced a medical error in their own care"
In politics, this technique is known as "push-polling" and is considered unethical because the interviewer influences the response in a particular direction. In this case the interviewer prompts the reporting of an error. It is hard to avoid suspecting that the pollsters were pushing for answers that included reports of errors and worries about quality. That is a newsy result. But how truthful?
Having read the first 20 pages of the 2004 survey, I am now going to watch the world series. So far, I would say the most significant findings in 2004 were:
1. People were much more satisfied with their own care and costs than they thought other people were. This is the same finding as reported in the 2006 Kaiser survey. It is also consistent with findings from health care polling that I have seen since the 1970’s. I still think this disconnect results from the continual, breathless media reporting of a "crisis" in US health care.
2. People were surprisingly ignorant about health care and the cost of health care. When asked to rank quality factors by importance, they tend to rank in reverse order – this is true for both the 2004 and 2006 polls. Why would this be? Again, I think this reflects what people think they know, and what they think they know reflects the faulty media coverage of health care.
3. By 2004, people were beginning to use the internet to obtain health care information. This received almost no attention in the 2004 survey – just a small remark. But I think this was the appearance of a very important trend, because information is power. "Info to the people!"
So far I have not found information that contradicts the 2006 Kaiser survey. There ARE however contradictory statements in the abc news summary of the 2004 survey. The abc summary is skewed by its failure to point out any of the above findings. I think that the skewed abc news summary supports the point I’ve been making about the media having bungled the reporting of health care over the past several decades.
Thanks, John!

Thursday, October 26, 2006

Of Insurance Companies and Morality

Recently, a blogging acquaintance whose opinions I respect (if rarely agree with) posited that “insurance companies are immoral.” His premise was that, since carriers make a profit, but do not then plow that profit (back) into the healthcare system, they essentially consume funds that could be served to increase medical research spending, build new facilities, etc.

I had, I must admit, a visceral reaction to this: after all, since I represent said carriers, I must be part of the problem, and therefore immoral myself.

After careful reflection, though, I came to realize that my commenter’s assertion was unsupportable on its face; that is, companies (whether health insurers, car manufacturers, or newspaper publishers) are simply impersonal entities and, as such, can be neither moral nor immoral. Consider this: is a rock moral or immoral? Well, one could say that a rock that hits you in the head is immoral, but it is really the ethos of the person who heaved it at you that’s in question. Rocks and insurers, are, in fact, amoral.

Further, it seems illogical to me that one should expect an insurance company to take its profits and gift them to, for example, science. For one thing, the company (presumably) exists to make a profit for its shareholders, and to provide employment for its, well, employees. It is not in the business of delivering health care: it is in the business of paying for it. By way of example, no one expects Campbell’s to provide a personal nutritionist to folks who buy vegetable soup. Does that make them “immm-mm-moral?”

So why would an insurance company be any different?

On the other hand, businesses are required to follow the law. Again, the law itself is neither moral nor immoral: it is a set of rules by which we, as a society, have agreed to abide. Reason I bring this up is because my personal convictions (outlined so eloquently above) are being sorely tested of late.

The group insurance market is a funny thing (if by “funny” one means “frustrating”). To wit: most group health insurers require that, if you’re going to place a group with them, you must write not only the health insurance, but the group life insurance, as well. From a business standpoint, this makes sense: the group health business is barely profitable, while the life side is extremely so, thereby “balancing things out.” And, truth be told, it often makes sense to do it this way: one bill, one phone number, etc. But there are times where it is not desired, and the law in Ohio says that a carrier cannot require a “tie-in” sale such as this.

At least, that’s what I’ve always believed. I used to have a copy of the pertinent law; it is long ago lost in the paper black hole that is my office. I recently had occasion to write a small group case with XYZ [ed: Name of carrier redacted not to "protect the innocent," but because it is not the only "guilty" one], which has not previously had the life requirement. Now they do. Problem is, I already have the group life for this group written with another carrier, and neither the client nor I are particularly moved to change that. Now, though, XYZ has refused to underwrite this group absent the life. No problem, says I: I’ll dig up my copy of the relevant section of the ORC (Ohio Revised Code) and wave that in front of them. Only I can’t find the darned thing.

No problem, repeats I: I’ll find it online (the ORC and OAC are both on the web). Several hours (and cups of coffee) later, no dice. Still no problem, hopes I: I’ll call up my friendly neighborhood insurance department, they’ll have it toot-sweet [I know, just let it go]. Only they can’t find it, either.

No problem, panics I: I’ll call up a friend who works at LexisNexis, that’ll do the trick. Only, several hours later, she comes up empty-handed, as well. Now what to do? I know that they can’t force me (I actually have a very good reason to know that I’m right, but that’s not relevant here). Except, they can. They won’t back down, time is running out, and I won’t put my client at risk. Back down, counsels I: and I did.

So what’s the “moral” of this little tale? Well, it’s pretty simple: insurance companies are not immoral.

But insurance company policies sure can stretch that envelope.

Wednesday, October 25, 2006

Yo Quiero Health Insurance?

A relatively new health insurance plan implemented in Mexico in 2003 has begun to reduce infant mortality rates and the number childhood deaths from cancer, according to seven new studies of the plan published this month in the Lancet, the Long Island Newsday reports. According to Newsday, the plan, which seeks to provide universal health insurance for Mexican residents by 2010, "has become the envy of developing countries worldwide."

Universal health insurance. Where have we heard that cry before?

Mexico since 1943 has provided public health insurance for residents with full-time jobs, or about half of the population, but the remainder lack coverage

No job, no health insurance. Wonder if that includes work outside of Mexico?

Workin' in the Golden Years

Found this little number, based on a Pew Research Center study, enlightening:
Turns out that, even though a majority of those surveyed believe that they'll have to continue working even after they retire ("Hello, welcome to Wal-Mart!"), it may not be so. Apparently, only a bit more than 10% of retired folks currently work outside the home (either full- or part-time).
Our goals about when we'll retire seem a bit unrealistic, however: although the Average Joe (sorry, Joe!) believes he'll retire at about 61, folks are actually retiring (on average) at the ripe old age of 58. Who knew?
Most surprising (but pleasantly so) was the finding that -- 2 to 1 -- the folks who think they'll be working post-retirement expect it'll be because they want to, not because they have to.

Cavalcade #11 is up!

Spencer Hill hosts this week's edition. The CoR continues to grow and thrive, thanks to folks like Spencer, who presents over a dozen posts, categorized by risk-type.

Perhaps best of all, our own Bill Halper makes his CoR debut with this edition.

I was intrigued by this post from Michael Cannon over at the Cato Institute: he effectively fisks the idea that employers that offer health benefits will be at a competitive disadvantage. Interesting points.

FYI, we'd love to have YOU host an upcoming edition; you can volunteer by email. As Spencer can tell you, it's fun, it's easy, and it gets you off "the nag list."

Tuesday, October 24, 2006

Grand Rounds...

An excellent 'Rounds today; Bob Coffield, host of the Health Care Law Blog, presents over 50 posts (including 2 from IB!), all helpfully categorized and summarized. Plus, he's added "live links" to Flickr pix for some of them. Very cool!
I love to grill salmon (medium rare) and tuna (rare! for me). And, fish taco's (well, burrito's, really) are a family favorite. Now comes word, via Dr Emer at Parallel Universes, about two conflicting studies about how healthy fish really is (are?). I know I'm hooked (Sorry, Charlie!).

Monday, October 23, 2006


The Carnival of the Capitalists is hosted this week by the legal beagles at Blawg Review. Broken into useful categories, each of the more than 40 entries has its own summary.

The Photon Courier (is that cool blog moniker, or what?) has the skinny on a new use for a (very) old product.

And this week's Carnival of Personal Finance is up at Fat Pitch Financials. Over 60 posts, also categorized and summarized, grace FPF's tremendous efforts.

As a self-professed "funny guy" myself, I especially enjoyed this little gem from Long or Short Capital.

Out of Touch?

Our recent Good News post generated a lot of comments and dissenting views. So I decided to go back to the well once more and pull up another chart to review. This one has to do with rising health care COSTS. (Click image to enlarge).

The top reason listed by those surveyed? Drug company profits. Other causes and the percentage of respondents listing the cause follow.

50% say drug companies are making too much money

37% say med mal suits are the primary issue

Another 37% list fraud & waste in the health care system

36% say doctors & hospitals make too much money

Here is an interesting observation. Only 2 categories of contributing factors shoulder the blame on consumers.

29% say consumers are getting treatment they don't really need


28% say people need more care due to unhealthy lifestyle

Do drug companies make too much profit? Recent numbers indicate the profit margin for many companies is around 16 - 18%. Certainly this is much higher than grocery stores with an average 3 - 4% profits, but how much does it really affect health care costs?

On average, meds make up around 16% of total medical claims. If drug company profits were reduced to grocery store levels, how much would the cost of meds decline? Around 12%. How much of an impact on overall health care costs would such a move have? About 2%.

Back to the survey.

Of the 10 categories listed as affecting health care costs, 5 are clearly foisted on "the system" bascially following a theme of someone in the delivery system making too much money or needlessly overcharging. Only 1 category clearly states that consumers are at least partially responsible due to lifestyle while another hints that those receiving unnecessary treatment may be at least partially to blame.

And perhaps most surprising of all, only one category showed a positive response (rather than shifting blame) by stating people are getting better care.

Of course we now know this is really illusory since consumers are not really intelligent enough to distinguish between good and bad care . . .

Sunday, October 22, 2006

Insurance Dispatch

In this week's column, available at The Medical Blog Network, we discuss a new survey of which indicates that, even with health insurance premiums increasing, most employers don’t plan to delete their plans. And Kentucky even has a new plan to help them out.

Please stop by.

Saturday, October 21, 2006

Health Care Poll

Frequent IB commenter (and fellow blogger) Marc Kashinsky has an interesting new poll up, as a result of Bob's recent post on the recent ABC News/USA Today/Kaiser Foundation poll on how the American public views its healthcare.

Hey, it's an election season people, go vote!

We'll let you know the results when they're in.

Good News??


In a recent ABC News article titled "Prescription for a Change", the headline would have you believe the American public is fed up and ready for something new. The polls reveal something different entirely.

According to a joint poll conducted by ABC News, USA Today and the Kaiser Family Foundation, we see the following results:

89% are SATISFIED with the quality of care they receive

83% are SATISFIED with the ability to get emergency care

79% are SATISFIED with the ability to see top quality specialists

78% are SATISFIED with the ability to get the latest treatments

And 57% are SATISFIED with the cost of health care.

So where is the prescription (or mandate) for a change? When you lower the cost of health care, which should satisfy more people, how much of an impact will that have in other areas where the satisfaction range is 78% or higher?

Friday, October 20, 2006

Weekend Fun

It's been a while since we last touted the incredible talents of the folks on our BlogRoll.

And so:

■ Joe at Roth & Co tells us that the IRS has no fury like a woman scorned.

■ Ever thought of your cell phone as a life saver? Dave at the Health Business Blog has some good advICE.

■ Here at IB, we blog (a lot) about health care transparency. Chris at Med Bill Manager has some real life examples of transparency in action.

■ Ever heard an actuary joke? Over at Workers Comp Insider, John has an insight into what makes them tick.

■ I don't do P&C (auto and home insurance), but I find the little gecko annoying. Bob at Specialty Insurance Blog has the story of one agent who's fighting fire with fire (metaphorically speaking, of course).

■ Rounding out our handful of helpful hints, BRC Mapgirl offers some tools for folks facing the daunting task of open enrollment.

Have a great weekend!

Election Time...

No, not that election: employee benefits election time. Our family’s benefits come courtesy of my better half’s employer, and last night was THE night to make our choices for next year.
Why last night, you ask? After all, most employers have weeks and weeks available for Open Enrollment. Well, hers is no different: OE has been on-going for some time. Last night marked its end (well, actually, it ends today, but last night was the first opportunity we’ve had to get those elections made). If you’re thinking “hey, the Prof, guru extraordinaire, is a procrastinating SOB,” well, you’ll get no argument from me.
In any case, I’ll share one of the choices we made, because it's illustrative of how I try to live what I preach: consumer empowerment.
The employer in question offers several health plan options (known in “the biz” as a “cafeteria plan”). Some are high-end, soup to nuts plans, some are “in the middle,” and there were even two HDHP (High Deductible HSA-compatible Health Plans). When I saw that, for the first time, we could choose an HSA, I was thrilled. I couldn’t wait to jump on board that train.
Our current plan is one of those “middle of the roaders:” a modest deductible, 20% co-pays at network doc’s, a prescription drug card. Nothing too fancy, and priced accordingly. Our maximum exposure (OOP) for a catastrophic claim is $4,000 (that number is important; we’ll be coming back to it).
We were offered two HDHP choices: a $2400 family deductible, and a $5,000 family deductible. Neither of those was particularly frightening, until I read on: in addition to the deductible, the plan also added a co-insurance layer of 20%, bringing the max OOP to $7,200 and $10,000 respectively. Yikes!
To put this in context: one of the reasons I like HDHP plans so much is that one can delete the co-insurance (the confusing 80/20, 70/30, 60/40, what day is it?) component altogether. This makes for a simple, and usually inexpensive plan design. In fact, I often tout the lack of co-insurance as the best feature of such plans.
So of course, the HDHP that we were “offered” included a substantial co-insurance chunk, bringing the max exposure on a large claim to over $7,000. But we’d be saving big bucks, right? Well, if by “big bucks” you mean $240 a year well, then, yeah.
Needless to say, we opted again for the “generic” plan. I was quite disappointed: I would really prefer to go the HDHP route, for a number of reasons, but there has to be some “reward” for such a “risk.”
So, am I a hypocrite for pushing HDHP’s? Not at all. If, for example, that was all I ever recommended – a “one trick pony” – then no question, a hypocrite would I be. But I don’t do that; when it’s appropriate, I recommend such plans to my clients, and I continue to blog on their merits (and disadvantages, of course). It’s really up to the carriers to “get it,” and come up with product designs and pricing that make sense.

Wal-Mart Rx Redux

Recently we posted on Wal-Mart, one of our favorite targets (not to be confused with Target) partly because of their visibility. In the last few years Wal-Mart has been the focus of quite a few news stories, some favorable, some not.

Many of the stories seem to revolve around their workers, and how much (or how little, depending on your perspective) the company contributes towards the cost of health insurance.

But lately WM has put some positive spin on a topic that is near & dear to our hearts . . . the price of prescription meds. The American public are, on average, very poor consumers when it comes to health care dollars. About 40% of us are covered by employer plans that are (usually) heavily subsidized by tax breaks and employer contributions. Add to the mix the number of plans with HMO type benefits featuring low copays and you have a recipe for abuse at the consumer level.

Employees who see only a nominal deduction from their paycheck are dumbfounded when confronted with a COBRA premium for families that is in some cases equivalent to a mortgage payment. Even more so when they refill their meds and have been insulated from the REAL cost of drugs by a ridiculously low copay.

The fact is, medication is OVER prescribed as evidenced by many studies. One recent one found NO SIGNFICANT DIFFERENCE in toddlers started on antibiotics immediately after diagnosis of an ear infection vs. those who waited 3 days before treating the infection.

Other studies have shown that generics and older meds are just as effective in many cases in treating illness but at a fraction of the cost of the latest & greatest concoction.

Now Wal-Mart is out to prove a point (and perhaps gain market share) by lowering the cost of many generics to just $4. The test program started in Tampa and has now spread to 14 states.

We applaud this move and hope other retailers will follow suit. This type of arrangement will accomplish a lot in curing copay dependency.

Thanks to Marshall Manson (not to be confused with Marilyn) for tipping us on the expansion beyond the Tampa market. In fairness to our readers, Marshall is a publicist with Edelman whose clients include Wal-Mart.

Thursday, October 19, 2006

Cavalcade #11 - Submissions Due

Just a reminder that submissions for next week's C of R are due Monday (the 23rd). Spencer at Hills Personal Finance would love to see your work. You can submit entries:

■ via email


■ at Blog Carnival

PLEASE include:

► Your blog's url
► Your post's url
► The trackback url (if applicable)
► A (brief) summary

PS: We're still looking for hosts. If you'd like to host a future edition, just drop us an email.

Ethics in the Workplace

Admittedly, this little gem is not insurance-specific, but I received it via an online insurance news aggregator to which I subscribe. The article intrigued me, and I’d be interested in IB readers’ responses. Feel free to comment anonymously, BTW; this isn’t a test, more like a tweak:
Randy Cohen (who pens the column) answered that not only was it ethical, but advisable. According to Mr Cohen, his correspondent should have read the contents, and then passed it around to his colleagues. After all, he opines, “(t)he one who benefits most when such information is suppressed is your boss, not you or your colleagues.
I beg to differ. For one thing, whether or not the document (or any document, for that matter) is labeled as “Confidential” or “Top Secret” is immaterial: it doesn’t belong to me, and unless I’m invited to read it, it’s none of my business.
On the other hand, the idea that one’s salary is not necessarily considered confidential intrigues me: why wouldn’t it be?
So, dear IB readers, what say you?

Not Health Insurance

No one wants health insurance.

No one wants a drill. What they want is a hole. The way to get the hole is to buy a drill.

Same thing with health insurance. Owning health insurance does not guarantee your health any more than owning life insurance does not guarantee you will not die.

You buy health insurance for one reason, and only one reason. To cover the financial bills that accompany a major illness or accident.

Insurance is based on the premise of indemnification which means "to make whole". If your car is stolen, your insurance will indemnify you (subject to policy limits) and put you back in a car of similar value. You don't get your original car, nor do you get a brand new car, even if your car is only a few months old. You get the value of the car that was stolen.

Same thing with health insurance.

You may or may not get your health restored to 100%, but that is not a function of the insurance. What you will get is at least a portion of your medical bills paid by the carrier so you can move on with your life.

You can certainly buy sore throat insurance that allows you to see the doctor any time you have a sore throat and only pay $10 plus another $10 for the medication. And you can buy ingrown toenail insurance, and acne insurance, and dandruff insurance but these kinds of plan will be very expensive.

You have to wonder if it is really insurance when you are trying to cover things that can either be anticipated and planned for, or can be covered from a savings account in the event you suddenly come down with an ingrown nail.

When you have that heart attack, or you are run over by a truck, you really don't care about the piece of paper that says Big Safe Company Health Insurance Policy. The policy does nothing to ease your mind or pay your bills. You can't take your policy to the hospital or doc and expect them to thank you for showing them your policy. They really don't care who the carrier is. They just want their money.

Similarly, while it is nice to be able to see a doc for $10 you should be more concerned about how you are going to pay $150,000 for a liver transplant. If you get a sore throat and don't have $100 or so to see the doctor, chances are your throat will get better in a day or so.

If you need a new liver, you really can't put that off and there are not many doctors (and hospitals) willing to sell you a used liver on the monthly installment plan. The health insurance plan collateralizes your liver transplant, making it possible for you to live a long and healthier life.

Wednesday, October 18, 2006

Plasma Recharge

I've never really considered the plight of those with hemophilia, so I found this news compelling:
In order to qualify, patients have to meet certain financial thresholds, and be able to prove that they've had diffculty obtaining health insurance.
PatientCare itself provides access to therapies used to treat both Hemophilia A and B.

It's Wonky!

UberMedBlogger Ezra Klein hosts this week's edition of Health Wonk Review. He presents 10 high-quality posts, and offers his own helpful commentary and context with each.
FoIB Julie Ferguson, blogging at Workers Comp Insider, informs us that employers are increasingly turning to on-site medical facilities to help contain costs.

Worth Mentioning

As a follow up to an earlier post I thought some of the comments by John Stossel were on the mark.

Suppose you had grocery insurance. With your employer paying 80 percent of the bill, you would fill the cart with lobster and filet mignon. Everything would cost more because supermarkets would stop running sales. Why should they, when their customers barely care about the price?

Mr. Fembup, are you feeding Mr. Stossell ideas?

Suppose everyone had transportation insurance. The roads would be crowded with Mercedes. Why buy a Chevy if your employer pays?

I am leaning more toward a Porsche.

Suppose car insurance worked that way. Every time you got a little dent or the paint faded, or every time you buy gas or change the oil, you'd fill out endless forms and wait for reimbursement from your insurance company. Gas prices would quickly rise because service stations would know that you no longer care about the price. You'd become more wasteful: jackrabbit starts, speeding, wasting gas. Who cares? You are only paying 20 percent or less of the bill.

This analogy has been used more than once on this site. It never gets old.

Somehow people seem to believe "insured" means free.

I am beginning to think someone actually gets it.

Tuesday, October 17, 2006

Pass the Prozac...a mildly cynical view of the future

To state the obvious, one of the pressing issues facing the American economy is the spiraling increase in healthcare costs. All forecasts that I have seen are pretty grim, essentially projecting an unremitting increase in demand, coupled with increasing costs in delivering care.

So far, every solution that has been tried has ultimately failed. PPO plans, by steering patients to providers with pre-negotiated prices, were invented to provide a lower cost alternative for indemnity plans. HMO plans included still more constraints, with the idea that the gatekeeper system would reduce unnecessary utilization and reduce costs still further. Somebody forgot, however, that low copays attract heavy utilizers. Today in California, many HMO plans are more expensive than the PPO plans. So much for Plan B.

The latest trend is to Consumer-Directed Health Plans, a polite euphemism for cost-shifting from the employer back to the consumer, with the aim of encouraging the consumer to make cost-effective health-care decisions. The underlying assumption, of course, is that the consumer has both the ability and willingness to make cost-effective decisions...an assumption, based upon the consumers that I know, I view with extreme skepticism. Consumer-driven health plans also fail to address any of basic cost drivers in the system: the rights of illegal immigrants of procure subsidized care; the large ranks of the uninsured, to whom a high-deductible or consumer-driven health plan is about as attractive as anesthesia-less colonoscopy; the pricing of prescription medication by their "“economic value"” as opposed to the cost of research and production; the rise of large hospital chains with geographic near-monopolies; and last, but not least, the general aging of the population, complicated by modern medicine's ability to extend the lifespan of the aged infirm almost regardless of cost and resulting quality of life.

No, the picture isn'’t very pretty, but I, with apologies to Jonathan Swift, have A Modest Proposal. Almost all insurance policies, with the exception of HMO's, which can, of course, be modified, have a lifetime maximum benefit amount. Up until now this has been impossible to enforce. Simply by changing insurance companies or jobs, the old information vanishes into the ether and the accumulated draw against your lifetime maximum gets reset to zero. This, however, is about to change. There is a concerted effort to implement electronic databases containing one's entire medical history. For the first time, we will truly be able to determine who the heavy users are of medical services and take appropriate action to stop this drain on societal resources. A lifetime max can truly be a lifetime max. When you hit it, you hit it... Let'’s just say that it gives a whole new emphasis to the concept behind consumer-driven health plans.

Just think. Finally there will be a true incentive to exercise. To diet. To stop smoking. Just don't overdo the jogging. You don'’t want your knees to wear out. Replacing them is expensive.

Grand Rounds...

ER nurse Kim, hostess of Emergiblog, presents this week's edition of Grand Rounds. What's all the more remarkable is that she posted it immediately after working a 12 hour shift. WoW!
It's difficult to expresso just how frothy this 'Rounds turned out. It's grande, yes, but it's also well grounded. Really, with 53! posts, it's the cream of the crop.
I was particularly impressed with this post at Inside Surgery. Blogress Lisa Marcucci interviews noted healthcare attorney Alice G. Gosfield, who discusses how she sees healthcare today, and tomorrow.

Monday, October 16, 2006

Money Monday

With over 45 posts, each with its own summary, the Make Love Not Debt blog presents this week's Carnival of Personal Finance.
Although I usually hate math, this post, over at eFipo, uses it to prove that folks who drink (liquor) earn more than teatotalers. WooHoo!

And the Carnival of the Capitalists is up at Blogblivion. Our host, Jay, celebrates the Carnival's 3rd anniversary with a series of "retro" posts.
Take a gander.

Sunday, October 15, 2006

Millions Still Uninsured

We live in the wealthiest nation in the world, yet those who are least able to take care of themselves go without health insurance. Many are forced to live on the streets, but most live in homes with wage earners. A good number of the homes have incomes in excess of $50,000 yet they lack health insurance.

When illness strikes, the provider must be paid out of pocket without assistance from a health insurance policy. In some cases, the anticipated medical bills are just too much for the family and the only alternative is euthanasia.


Veterinary care has gotten expensive, but people’s expectations have also gotten higher. Like anything, it (pet insurance) will become more commonplace, especially with rising costs.”

Just for general care during a year, pet owners can expect to spend nearly $300, said Suzanne S. Weaver, director of the Matthew J. Ryan Veterinary Hospital at the University of Pennsylva-nia in Philadelphia. Add in extra costs associated with illnesses, accidents or other unforeseen dilemmas, and the costs rise.

“If you get it (pet insurance) at the right time, we do think it generally is a good thing,” she said. “Often people are not even aware of it until they come to a place like this. It needs to be advertised more.”

Now You See It . . .

To avoid becoming a financial burden to her children and grandchildren, Vera Smith bought long-term care insurance. Like a growing number of Americans, the 87-year-old retiree saw it as a sensible way to cover care-giving costs not included in Medicare and conventional health insurance.

But almost two years ago, Smith's insurer stopped paying benefits, contending that she violated the policy's terms by moving in with her daughter after she became too frail to take care of herself. That forced Veray Smith, the daughter, to quit her supervisory job and sell her mother's South Los Angeles house so she could afford to stay home with her.

"I'm the full-time caregiver now. It's hard," said Veray, who along with her mother has sued the insurer for bad faith. The insurer, Penn Treaty Network America Insurance Corp., declined to comment.

Consumer advocates and insurance regulators say that lawsuits and complaints like the Smiths' are likely to mushroom in the coming years as more baby boomers and their ailing parents make claims on long-term care insurance.

Many carriers found their business to be under-funded and were forced to raise rates, deny claims or exit the market altogether. Carriers like CNA, Fortis & TransAmerica are no longer in the LTC business.

Read & understand your policy benefits & limits BEFORE you buy.

Insurance Dispatch

In this week's column, we look at the explosive growth of of Health Savings Accounts (the accounts themselves, not just the insurance component), and learn that there may be a "dark side" to how they're implemented.

Check it out over at The Medical Blog Network.

Saturday, October 14, 2006

Street Walking

From Social Security numbers to private addresses, sensitive information was scattered in the parking lot outside a family practice office Thursday morning.

Movers cleared the office of Dr. Charles Kay of Orchard Family Practice after Kay was evicted for falling behind on rent payments in the building.

Kay says he had to close his general practice after 15 years of operation because of bankruptcy.

The article does not elaborate on the cause of the bankruptcy. Wonder if he was a PCP who could not make it?

Kay says he has already taken care of most of his patients' private medical information.

"Along with my wife and daughters, we've moved somewhere between 12,000 and 14,000 charts to a HIPAA secure location," said Kay.

HIPAA secure location. Wonder if Jack Bauer could find it?

Speaking of Consumerism...

A recurring theme here at IB is the empowerment of the consumer to make informed health care choices. It’s the driving force, after all, behind Consumer Driven Health Care (CDHC). More and more carriers are making critical information available, but are their insureds availing themselves of it? Well, according to the Kaiser Family Foundation, not so much. A telephone survey, conducted this past August, of over 1200 randomly selected adults found that consumers aren’t necessarily exercising that power:

Of course, transparency is a relatively new phenomenon, so I suspect that these numbers will change as more tools come online, and more CDHC products are adopted.

Friday, October 13, 2006

Life Insurance ON Sale

Yep, you read that right: seems that life insurance (in all its various flavors) is not just FOR sale, it’s ON sale.
Okay, Henry, what the heck are you talking about?
Well, the Insurance Information Institute (I.I.I.) just released a study showing that premiums for folks buying life insurance for themselves have been steadily decreasing. In fact, over the past ten years, they’ve been averaging a 9% decline. Dr. Steven Weisbart (who authored the study) says that:
He went on to explain that rates for term insurance have been dropping for decades. That makes sense, especially in light of life expectancy data from the published by the National Center for Health Statistics:
That doesn’t mean, of course, that you’re automatically going to see your own premiums drop: we’re talking averages on new business here, not what folks who already own their policies pay. Since an individual’s rates are determined in part on age, smoking and health status, even hobbies, not everyone will benefit from these declines.
Still, if you have a policy that’s more than a few years old (and particularly if it’s term), it may be worthwhile to review your coverage with your agent.
You DID use an agent, right?

Thursday, October 12, 2006

TMJ coverage...

Over the years, I've paid an amazing amount for TMJ treatment for various members of my family. No medical carrier has ever given me a logical answer as to why a jaw joint is excluded from coverage. Why is it treated differently than, say, a knee? Admittedly TMJ can be caused by dental problems, but it can also arise from a host of other things...like the time my son ran into somebody's elbow while running on the beach.

Anybody have any thoughts?

Wednesday, October 11, 2006

Oh Canada

We haven't picked on our neighbors to the north in a while, so this article caught my eye.

Provincial government spending on health care will consume more than half of Canada's total revenue from all sources by the year 2020 and all revenue by 2050 in six out of 10 provinces if current trends continue, according to a study by the Fraser Institute.

Half huh? Where are the left wingers who say WE can't control health care costs?

The authors suggest the governments could slow the growth in public health expenditures while increasing the availability and accessibility of medical care if they introduce policies being used in other countries:

Slow the growth . . . adopting what other countries do . . .

Require patients to make co-payments for publicly insured health services.

Acknowledge the individual right of patients to pay privately (via private insurance or out of pocket) for all types of medical services, including hospitals and physician services.

Allow providers to charge extra fees directly to patients above the public health insurance reimbursement level and receive reimbursement for their services from any insurer, whether public or private.

Permit both for-profit and non-profit health providers to compete for the delivery of publicly insured health services.

Copays . . . private health insurance . . . allow providers to charge extra . . .

What a novel idea. Wonder how they came up with those ideas?

Union Strike

A few weeks ago, Carl Garrett, a 60-year-old North Carolina resident, was packing his bags to fly to New Delhi and check into the plush Indraprastha Apollo Hospital to have his gall bladder removed and the painful muscles in his left shoulder repaired. Mr. Garrett was to be a test case, the first company-sponsored worker in the United States to receive medical treatment in low-cost India.

But instead of making the 20-hour flight, Mr. Garrett was grounded by a stormy debate between his employer, which saw the benefits of using the less expensive hospitals in India, and his union, which raised questions about the quality of overseas health care and the issue of medical liability should anything go wrong.

“I was looking forward to the adventure of being treated in India,” Mr. Garrett said the other day. “But my company dropped the ball.”

Sounds to me like the union was the one who dropped the ball, not the company.

The union, the United Steelworkers, stepped in after it heard about Mr. Garrett’s plans, saying it deplored a “shocking new approach” of sending workers to low-cost countries as a way to cut health care costs. Its officials insisted that Mr. Garrett be offered a health care option within the United States.

Shocking, huh?

Frankly, I am surprised this is a covered item. When does a union have a voice in WHERE the individual receives care? I doubt this is part of the CBA.

Guess I should not complain about my ISP and their Indian tech support division.

In A Perfect World . . .

Matt Masewic opened Boscawen Family Practice two years ago with dreams and a plan. He had ideals about the kind of medicine he would practice. His independent practice would provide a service to the community - no rejecting patients without insurance, no 10-minute, rushed visits.

He also knew that finances would be tough. He brought in his brother to help him renovate the modest office he rented from the town, bought used equipment and furniture, and hired a bare-bones staff. He figured that this combination of frugality and quality medicine would help his practice survive.

But he was wrong. At the end of the month, Masewic will close his practice, leaving behind the rehabbed building and his roster of 1,200 patients, and holding about $500,000 of debt

Ideology is great, but it does not pay the bills.

Masewic's financial troubles have been even more acute than those of his peers, because he decided early on that he would not turn any patients away. He takes patients with private health insurance, but also patients with Medicare and Medicaid, which often pay him less than his cost for the visit. An Army Reserve veteran, he even takes military insurance, which pays so poorly that the next nearest provider is in Manchester.

Perhaps worst of all, he takes patients with no insurance at all and doesn't require them to pay him up front.

"I didn't think it would be so difficult to collect," he said. "I thought if I provided a good service, they'd pay for it."

'Fraid not.

Sadly, too many abuse the system AND your good heart.

Free is never appreciated.

A Simpler Way...

We get letters. Today I received an email alerting me to this post at Think Progress:
Okay, I made that last part up, but it’s of a piece with the general tone of the post. There’s little doubt that, as a society, we’re too fat, smoke and drink too much, and don’t take care of ourselves as best we can.
And this is news, how?
The fact is, we are living longer (I’ll take the actuaries’ analysis over the nannies at NIH any day; the actuaries are playing with REAL money), and new treatment protocols are being introduced every day.
Now, do I agree that we should take better care of ourselves? Of course, but I don’t think we need another gummint program to do so. Fact is, there are several easy, low-tech, low-cost ways to accomplish this, if we really want to.
That’s the crux, by the way: each person is, ultimately, responsible for his own health and well-being. So forcing folks to take their flu shots is really no different than forcing them to…well, you fill in the blank. The point is, folks that want to improve their health will do so. I blogged recently on my ambivalence regarding health insurance covering preventive care. I’m starting to lean towards that, but it’s really up to the markets to dictate how that plays out.
Seems to me that the carrier(s) which figure out how to profitably cover such expenses will be the big winners (as will their insureds, of course). If it’s what we really want, more carriers will follow (cf: HSA, transparency, etc). The last thing we really need, though, is another tax-payer funded debacle (e.g.: Medicare Part D).
See, it really is that simple.

UPDATE: Vis flu shots and other vaccines, it appears that at least some congress-critters have cast doubts on the CDC's assessment of such preventive med's. According to this article, the agency "
the agency is tainted by conflicts of interest because it is also the chief promoter for vaccinations."

And the Survey Says...

When we discuss "benefits" here at IB, we most commonly refer to insurance products (group health and life, HSA's, etc). Occasionally, we discuss non-traditional benefits (e.g. Sabbaticals and QTEPS), as well.
Recently, though, the Bureau of Labor Statistics polled both private- and public-sector employers to determine which kinds of benefits are most "popular." Perhaps unsurprisingly, vacations and holidays topped the list:
Interesting, no?

Cavalcade #10 is up!

Wenchypoo has done a terrific job, and invites you to come see her efforts.

Each post is categorized, and includes helpful commentary. Kudos!

Bob Sargent, blogging at Specialty Insurance, asks if their clients want insurance agents to be in the insurance business or the risk management business. The answer is: yes.

FYI, we'd love to have YOU host an upcoming edition, just drop us an email.

Tuesday, October 10, 2006

Grand Rounds...

You can read up on the best of the medblogosphere at Unbounded Medicine. Host Jon Mikel IƱarritu presents an attractive and easy to navigate GR, with 30 entries. It's laid out as medical journal's Table of Contents, and each post has its own summary.

As longtime IB readers know, I'm a stickler for proper terminology (e.g. HIPAA vs HIPPA), and it looks like I'm not alone: seems that Bob Coffield (the Health Care Law Blog) shares my AR tendencies.

Legal Heavyweights

We’ve blogged before about lifestyle choices and insurance. But a 30 year old Michigan law may add some heft to the argument:

Although little-used since it was enacted in 1977, Michigan's unique protection [the Elliott-Larsen Civil Rights Act] is expected to grow in ever more conflict with employer crackdowns on unhealthy behaviors.

Apparently, some Michigan employers are being sued for terminating obese employees. The rationale is that such folks are at far greater risk for heart attacks (and, one supposes, more sick time), which may not be too far off the mark:

A 2003 report by the U.S. Department of Health and Human Services estimated the cost of obesity to U.S. companies at $13 billion per year, based on $8 billion in health care costs, $2.4 billion in paid sick leave, $1.8 billion in life insurance and $1 billion in disability insurance.” (ibid)

That’s a lot of claims paid on behalf of one subset of employees. Michigan’s law is unique: federal law doesn’t really address the issue. The much-vaunted ADA (Americans with Disabilities Act) only comes into play if the affected employee suffers a disability as a result of his condition. If an employer terminates an employee before a disability occurs, he stands a pretty good chance of making it stick.

One of the benefits of group insurance is that it is “guaranteed issue;” that is, a carrier can’t decline a group because of health conditions. But the other side of that coin is that the insurer can (and do) charge a hefty premium for unhealthy groups, and a company with a lot of overweight employees certainly fits the bill. Another facet of group cover is that a carrier can’t decline a particular person, or charge one employee more than the others. The whole group subsidizes the unhealthy (e.g. obese) worker. Such is the nature of the product, and thus employers looking to trim their health insurance costs are tempted to dismiss high risk folks.

Is this a slippery slope? You bet: smokers fit this criteria, as do alcoholics and folks with high cholesterol. I suspect we’ll see more of this type of activity in the future.

Monday, October 09, 2006

Take Two Aspirins, and Email me in the Morning...

Well, health care transparency isn't the only thing that Minnesota BX is up to:
A patient simply emails his questions (or concerns) to the doc, who then responds via email. This cuts down on wait times for appointments, and the patient gets a quicker response. Folks who are out of town (on business or vacation, for example) can still "consult" with their preferred doctor, and not have to sit on hold or play phone tag.
That's the good news. The bad news (if it can really be classified as such) is that only about 25% of doc's have bought into this concept, and consumers aren't exactly knocking down the (virtual) door to participate, either. Part of the problem was that physicians couldn't charge for their email consults, which would tend to discourage widespread adoption of the practice. Once carriers start reimbursing for them, that should change (eventually).
This seems to me to be tailor-made for CDHP (Consumer Driven Health Plans): after all, the idea is to empower the patient to make informed decisions about his health care. What better way than electronic communication?
Very cool.

Money Monday: Carnival Time!

The Business Pundit hosts this week's special 3rd Anniversary Edition of the Carnival of the Capitalists. Boasting over 40 posts, categorized, summarized and organized, Rob's done a terrific job!
I've battled the late vs punctual demon all my life, and have (gradually) gotten better about being on time. Barry Welford, blogging at BPWrap, posits that being late is not just inconsiderate, but bad for business.
The Carnival of Personal Finance is hosted at its home page, and presented by its founder, Flexo. With over 50 interesting posts, each with a summary, it's a potpourri of possibilities.
Joe at Roth & Co tells us about an interesting, if a bit offbeat, IRS auction. Who knew an accountant's post could be (almost) NSFW?

Sunday, October 08, 2006

Insurance Dispatch

In this week's column, now up at The Medical Blog Network, we revisit (and update) Qualified Transportation Expense Plans. Want a tax break for your commuting expenses? This little gem could be just the ticket.

Saturday, October 07, 2006

$2 Gas, $4 Meds

Wal-Mart Stores Inc. expects to offer $4 prescriptions for some generic drugs in most states this year, after accelerating rollout of the low-cost program in Florida, the world's largest retailer said Thursday.

Wal-Mart launched the program last month in the Tampa area in what it called an effort to save working Americans money on health care. But critics said it was a stunt to draw in business and a grab for a bigger share of the drug business.

At the time, Wal-Mart said it would expand the Tampa test statewide by January and nationally next year.

But customer demand was strong and Florida officials asked for a faster rollout, Wal-Mart said. It announced the statewide program effective Friday at a news conference in Orlando, Fla., with executives and Florida Gov. Jeb Bush.

Wal-Martalso is accelerating the national plan, said Bill Simon, executive vice president of Wal-Mart's professional services division.

It just doesn't get any better . . .

Friday, October 06, 2006

Stupid Carrier Tricks; Part 3

UPDATE: Since posting this I have heard from Golden Rule and they confess they gave me incorrect information. A client with an individual health insurance policy, under some circumstances, WILL be allowed to apply for a re-write of their policy. This will usually occur when the client is willing to take on MORE risk by migrating from a low deductible plan to a higher deductible.

Thanks for clearing that up!

We have blogged on this before. Today I discovered that United Health Care (which operates as Golden Rule in some states) has taken a page from the cell phone companies in customer relations.

In talking with my company rep (4th one since Feburary) I mentioned that I really like one of their no copay plans. I said I offer it as an HSA on training wheels for those who are trying to detox from their low deductible, copay plan but are not yet ready to take the leap to the much higher deductible HSA qualified plan.

By moving them to a no copay, $2500 then 100% plan it prepares them for taking the next step maybe a year or so down the road to the $5000 deductible HSA plans.

The rep just happened to mention that UHC/GR will not ALLOW them to change plans.

Excuse me?

You won't allow your client to move to a different plan, albeit a higher deductible?

That is right.

So you would rather I MOVE the client to another carrier vs. staying with UHC/GR?

No, we are not saying that at all.

Yes, you are . . .


I try to stay on top of ideas to save money for my clients. Today a client introduced me to a site that I will be sharing with others in the future.

The price of prescription meds has become incredibly high for many people. I have some clients going through $3k+ per month in meds. Because of this, I am always aware of health insurance plans that have artificial caps on reimbursement for meds and will never recommend a plan that has a cap.

In some cases it is to my clients' advantage to purchase their meds by mail order vs the local pharmacy. I always suggest they check out CrossBorder for low prices. Now I have another site to consider: Isrameds was referred to me by a client. I believe this is a site worth reviewing.

Some of the benefits of Isrameds include:

Low price guarantee.

All meds are individually packaged and labeled "Kosher". This may prevent delivery problems some people experience when they have ordered meds from Canada.

Up to 70% of "your money is returned to the Israeli government".



Perhaps the greatest compliment an agent can receive is a referral; they are the lifeblood of any professional who intends to stay in this business. And the most valuable of these is when a client recommends an agent to relatives. After all, you may only see friends from time to time, but you’ve got to deal with your brother-in-law every Thanksgiving.
Today I was paid one of the latter: one of my clients referred her sister to me, telling her that I had been helpful in securing medical cover for her family. The sister – we’ll call her Denise – lives in another city, about an hour away. Her husband, who owned his own business for a number of years, has sold it, and now needs to replace his “lost” coverage. Since the group plan had been through the local Blue Cross (BX), they thought it would be a good idea to just call up said BX and apply for coverage. They applied for a generic co-pay plan, complete with drug card.
Pretty cut-and-dry, at least so far. So why was she calling me? She’d already made application, and received an offer; what role could I possibly play?
Turns out, Denise was diagnosed some 10 years ago with fibromyalgia, for which she takes a particular medication. The problem is that this is one of those conditions (and meds) that insurers intensely dislike, a fact which an agent would have known, and who could have helped avoid the ugly result:
While her husband and daughter were approved for the co-pay/rx plan, she was offered a “stripped down” version at a greatly inflated price. As long-time IB readers know, having been declined or rated for health insurance once, obtaining coverage later becomes problematic. She is appealing the decision, and called me to see if I could offer a better alternative.
Knowing that her existing cover would go away at the end of this month, I advised her that she should accept the offer, while continuing the appeal. Better to have expensive, less efficient cover than none at all. I also told her that I’d see what my other carriers could do.
And then I started asking a lot of questions. After dispensing with the “normal” ones (height, weight, other meds, etc), I asked if she had ever heard of an HSA. She had, and they had actually discussed this. In fact, she asked me if it would help her appeal if she were to go that route. Sadly, it probably won’t: carriers don’t really care which configuration one chooses when they are underwriting (that’s another post). On the other hand, she should: I helped her work through the math, and see that by going with the HSA plan, they could almost completely fund the loss account, and still save money. I suggested that she call up the home office, and tell them that she wanted the HDHP (high deductible, HSA compliant plan). She’ll still be able to appeal the rate-up (good luck with that), but even if that failed, the family would be money ahead.
Needless to say, she was grateful for the time I took to help her noodle this through, and I took the opportunity to tell her that, next time, she’d be far better off working with an agent (preferably me, of course) rather than buying directly from a carrier.
Why? Well, a number of reasons. First, the folks at the home office are order takers, not professionals, and aren’t trained to offer this kind of advice (such as the HDHP/HSA idea) to prospective insureds. Second, since they work for the carrier, they're not going to be eager to help one pursue underwriting appeals.
Third, and perhaps most important, an independent pro would know which carriers to look at in the first place, and may have helped her avoid the problem (or at least minimize it). For whatever reason, folks believe that buying directly from the carrier (or from an internet service) will save them money, whether it’s life or health insurance, coverage for their cars and houses, or even their business liability cover. These people are sadly misinformed, and end up paying for an agent (an advocate) without actually getting one. That is, the commission is already built into the price, so someone is getting it, just not someone who’s accountable to you.

Logic and the Madness of Crowds...

A couple of months ago, I made a presentation to the employees of a mid-sized client. The employer's renewal premiums were being increased by 15%+ and, in response, we were moving the plan down one notch in benefits...overall, it was still a pretty rich benefit schedule. Also, the company was adding another plan choice for the employees...an HSA with a $2400 deductible. As an incentive for employees to switch into the HSA, the employer was going to contribute a substantial portion of the premium savings into the employee HSA accounts. It worked out to a contribution of $1700 for employees and $3400 for employees with additional dependents.

From my perspective, this was a terrific deal. If somebody had no medical claims (admittedly an unlikely situation), he or she would end up with a slug of money in the bank. In a worst case scenario, with a large claim, the employee's out of pocket cost would be offset by the employer's contribution to the HSA account...the net savings to the employee would be thousands of dollars versus remaining in the PPO plan. As a practical matter, most people would end up somewhere in-between. On top of all that, the employee's share of the premium would be decreased to reflect the lower rates the employer would pay. It was a true win-win situation.

Out of 35 employees, guess how many switched to the HSA? Exactly one. The reason most people cited for not changing? They liked the fixed doctor's office copayments in the PPO. Sigh.

Thursday, October 05, 2006

Entitlement Bellweather

Federal Reserve Chairman Ben Bernanke said yesterday the burden from retiring baby boomers will strain the nation's budget and economy, unless Social Security and Medicare are revamped.

"Reform of our unsustainable entitlement programs" should be a priority,

Harsh words that have been spoken before and continue to fall upon deaf ears.

Bernanke said that as the population ages, the United States will have to choose among higher taxes, fewer dollars for other programs, lower spending on entitlement programs, and a sharply higher budget deficit -- or some combination of all those

Choices. Lower spending. Higher taxes.

The federal government has on the table essentially unsustainable promises to the aging population

If Social Security & Medicare cannot be maintained at their current levels without increases in taxes, how will the budget ever absorb a nationalized health care plan for all?

Wednesday, October 04, 2006

Timothy's Law

New York health insurance companies have always drawn a line between physical and mental disorders, covering fewer expenses for patients suffering from severe depression, schizophrenia and other mental illnesses.

That began to change when Timothy O’Clair, a resident of Schenectady, committed suicide only seven weeks before his 13th birthday.

Now, with ‘‘Timothy’s Law’’ having passed the state Senate two weeks ago, many health insurance providers will soon be forbidden to make that distinction again.

One would think the MHPA would have already addressed this issue, but apparently the NY Senate disagrees. Perhaps it is because of this exemptive language.

MHPA does not apply to a group health plan or group health insurance coverage if the application of the parity provisions results in an increase in the cost under the plan or coverage of at least one percent

The NY law does not appear to have this exemption.

One wonders what the financial impact will be on the cost of health insurance once providers are given access to unlimited funds for treating mental illness.