American Airlines: Ethically Challenged Corporation

The good news is, we're home, safe and sound. And of course, that is the most important thing. On the other hand, we learned firsthand that American Airlines is perfectly willing to jeopardize our lives (and those of hundreds of fellow passengers) to make a few bucks. Harsh? You bet. Accurate? Oh, yeah.

Our return flight from beautiful (and friendly) Jackson Hole, Wyoming was scheduled to take off about 12:30 on a beautiful Monday afternoon (yesterday, in fact). We had purchased a flight with one stop-over, in Dallas/Fort Worth, which cost a bit more than the milk run, but we wanted to be home in time to be at work on Tuesday. The flight was to land at DFW at about 4:30, and our plane home was scheduled to leave at 6:30, leaving a two hour "window" for dinner, etc. When we boarded the plane in Jackson, however, we were informed that, because of "weather" in Jackson, we couldn't take off with full tanks, and would have to stop in Denver to have them topped off. This seemed odd, since it was such a beautiful day.

It got odder still when, about 20 minutes later, the captain told us that due to "weather" in Dallas, we couldn't take off with full tanks, and we'd have to stop in Denver to top off.

(Yeah, deja vu all over again).

At that point, we knew that there was obviously some other reason that they wanted to divert us to Denver, but couldn't quite figure out why. It seemed likely that there was a financially-driven motivation, but it was unclear what that might be.

So, we taxied out to the runway, where we stopped, and were informed that there were mechanical difficulties. These eventually led to a two and a half hour delay, and some other inconveniences. In fairness, though, and presuming that AA was being truthful with us about it (not necessarily a safe assumption, but we have no proof that it was otherwise), this was irrelevant to the primary issue: why Denver?

As we approached Denver, we were once again assured that we were only there for fuel; indeed, we were told that we wouldn't even be going to a gate.

And, of course, these were lies; as soon as we landed, we were informed of the real reason for the stop-over: to pick up 20 additional passengers.

It is well-known that the riskiest, the most dangerous parts of any flight are the take-off and landing. American Airlines, in its greed to squeeze out $5,000 more dollars (I checked, and the economy fare for Denver to DFW is about $250), the airline was willing to literally double our risk of a fiery death. Gee, thanks guys.

Thankfully (for us), the flights all ended safely, for which we are grateful. But that is despite, not because of, American Airlines greed -- its willingness to put its corporate welfare above its passengers' safety. It is unconscionable that this company, which we taxpayers have assisted, is so willing to forego its responsibility to put safety first. As soon as this post is published, I will be sending a letter to the President of American Airlines recounting these events, and then the NTSB to notify them, as well.

This post may not seem to have anything to do with insurance, but it certainly addresses the concept of risk. Proper risk assessment should have told these folks that they were playing a very dangerous game. Risk management should have indicated that the Denver diversion was unacceptable. That American Airlines didn't see it that way tells us a lot about their corporate view of acceptable risk, and what it says isn't pretty.

Rounds & Carnivals

Just returned from 5 fun-filled days in Wyoming, so this'll be brief (for now). Please take a moment to check out this week's Grand Rounds, ably hosted by David Williams at the Health Business Blog.

And then head on over to Plonkee Monkey (what a GREAT blog name!) for this week's compendium of financial expertise, the Carnival of Personal Finance.

Cavalcade #31: Submissions Due

Just a reminder that submissions for next week's CoR are due Monday (the 30th). Our host, Jason Shafrin, asks that you PLEASE include:

■ Your blog's url

■ Your post's url

■ The post's trackback URL (if available)

■ A (brief) summary of the post

You can submit them via Blog Carnival or email.

We still have Fall '07 hosting slots available. Hosting is fun, easy, and gets you off the "nag" list. Just drop us a line!

Incredibly Stupid Carrier Trick

[Welcome Industry Radar readers!]

As we've long-chronicled, insurance companies seem bent on making gummint-run programs more appealing. This one, though, may well be the most egregious example of inept, thoughtless incompetence yet:

Several years ago, I wrote health insurance for a nice, middle-aged couple, whom we'll call Frank and Ethel. We used Anthem (BX) because they offered good benefits at a reasonable price, and (at the time) were more liberal in their underwiting (Frank had some health issues). The plan was issued, and all was well.

Until early May, when Frank passed away following a brief illness. As required, we notified Anthem, in writing, that he had died, and would they please:

a) Remove him from the plan

b) Refund the premium paid on his behalf for the balance of the month in which he died

c) Let us know Ethel's (new) premium

d) Issue a new ID card for Ethel

None of this strikes me as particulary challenging; indeed, it's a relatively routine thing (well, for the carrier; I don't have a LOT of insured's dying every month). We sent this a week or so after Frank died, and waited.

And waited.

And waited. After several weeks went by, we became concerned that this was taking so long. It was especially problemmatic for newly-widowed Ethel, whose finances were, to put it mildy, shaky. So I called down to our service rep, who informed me that Anthem had "lost the letter," and asked if I could resend it. Since I had it in the computer, that was a fairly simple process. The bigger problem, though, was that Anthem had already drafted the June premium, which still included the deceased (who didn't really need the coverage). And now it's July, and guess what, they did it again! We finally sent down another letter, asking to stop the automatic withdrawls, and just send a bill.

The good news is that Anthem did stop the automatic withdrawals.

The bad news (and you just knew there'd be more of that, right?) is that the new bill shows Frank (and reflects his premium) but not Ethel. That's right, the dead guy has health insurance, while his widow doesn't.

There is simply no excuse for this kind of sloppy "customer no-service." It's bad enough that this poor woman has lost her husband, but to be constantly reminded of it (every time she checks her quickly diminishing bank balance) is unconscionable. We're still working our way up the food chain that is Anthem "customer service," and will keep you posted on any progress we're able to make.

UPDATE: Okay, just spent another hour on the phone with Anthem, and the situation appears to be resolved.

Essentially, when Frank died, they cancelled Ethel as well, and moved her to her own policy. The new policy has the same benefits and premium; it's really an internal mechanism resulting in her being assigned a new policy number as of the date of Frank's death.

Unfortunately, they didn't get around to accomplishing this until about 10:00 this morning (seriously!). Thus, it appeared on their records that Ethel had also died. As an aside: what a great deal for Anthem; they get the premiums, and dead folks file few claims.

In the event, Anthem proposed to credit the amounts Ethel was dinged in May, June and July to future premiums; I demurred, emphatically. Eventually, we arranged for Frank's premiums to be deposited directly back into Ethel's checking account, they would move her premiums from the old policy to the new, and she would begin August with a clean slate, a new policy number, and an appropriate premium.

I'd like to say that "all's well that end's well," and indeed, Ethel has mentioned several times how pleased she's been with how Frank's claims have been handled throughout this ordeal.

But the fact remains, the company fell down on this, big time, rarely returned calls, prevaricated in their answers and generally made a sad situation worse. That it took almost 2 ½ months to get this relatively simple transaction resolved is unacceptable, even for an insurance company.

Let the Games Begin

Fat Dragon may sound like an entree at a Chinese restaurant, but it's really the home of tabletop gaming icon Fat Dragon Games. In just two years, the company, run by an entrepreneur with a unique vision, has garnered widespread industry praise.

So much so that FDG has been nominated for two Ennie Awards, and we'd like to help them win at least one of those, the coveted Best Miniature Product award. All it takes is a few moments of your time, and a couple of mouse-clicks; no fees, registration or hassles.

Just click here (and scroll down to Best Miniature Product, select E-Z Dungeon's for #1).

Your support is appreciated, and we'll let you know how things turn out.

Another Carnival Monday!

This week's edition of the Carnival of Personal Finance is hosted by George, proprietor of Fat Pitch Financials. He presents over 4 dozen posts, all with helpful context, and all categorized. Nice!

I was very glad to see Big Honkin's guest post at No Credit Needed. He explains, by way of an expensive personal lesson, why it's important to have an emergency fund. Right now.

How much is 5Q + 5Q ?

Why, 10Q.

You’re welcome!

Now that we're talking about Q’s, let’s talk about health care queues.

Do governments deliberately manage the cost of their health care and single-payer insurance systems by restricting budget expenditures, thereby restricting capacity and forcing people to queue up and wait for health care services?

Persistent patient queues are evidence that the answer to this question is “yes.”

Many people claim that there are no meaningful queues in countries such as Canada and the U.K. That claim is false. The Canadian Supreme Court ruled in 2005 that "delays in the public health care system are widespread and that in some serious cases, patients die as a result of waiting lists for public health care."

In the U.K., complaints about waiting times for services continually comprise more than 25% of procedural complaints (i.e., excluding clinical complaints).

Many other people claim that there are no such problems in waiting for access to health care in the U.S. That claim is equally false.

Well, now, does that mean the objections to single payer because of waiting lines, are invalid because there are waiting lines in the U.S., too? Whoa, whoa, not so fast.

Two media reports just in the past week point to a major cause in the U.S. for people having to wait in line for health care. Irony of ironies, that cause is government-financed health insurance.

The first report appeared in the Wall Street Journal on July 19. This front-page article was about Medicaid, under which physician reimbursements are set so low that doctors say they lose money for most Medicaid services they perform. More and more doctors refuse to see Medicaid patients. Fewer participating doctors = waiting longer for an appointment.

The second report says that more than 25% of mammography centers in New York have closed since 1999, causing almost a tripling of wait times for appointments. Reason? Medicare pays only about 2/3 of the cost of a mammogram, and the centers are exiting that business. Fewer mammography centers = waiting longer for an appointment.

Is there any reason to believe either Medicare or Medicaid would do a “better” job if the government controlled 100% of health insurance in the U.S? I say no.

I think there are good arguments for single-payer, and there are good arguments against it. As a nation we are really not very close to resolving this debate on any rational basis. (We may be close to resolving it on some irrational basis – that’s a subject for another day). Meanwhile the queues in Canada and U.K. persist, and waiting lines are growing in Medicare and Medicaid. These events suggest that, while government-financed health insurance systems can be effective at reducing their budgets, they are much less effective at reducing health care costs. Accordingly, their strategy of reducing budget expenditures has the principal effect of reducing health care capacity. Less capacity = waiting longer for an appointment. Anyone think that's a solution? Not me. It's my idea of running thru Hell in gasoline pants. (thank you, Nipsey Russell).

This blessed plot, this earth, this realm, this England

On Friday July 20, the Wall Street Journal ran an article about automobile congestion in cities. The article described the solution in London - charge a “congestion fee”. Within the congestion zone and during business hours, everyone who drives a car (except people who live in the zone) is charged a fee. The charge is around $10. The fine for not paying the charge is about $100. So what? I mean, what does this have to do with health care? Well maybe nothing, but check this out:

The zone was recently expanded to include one of London’s largest hospitals, Chelsea & Westminster. And what happened? “Suddenly, the hospital’s emergency room was busiest just after 6 p.m. – when the zone stops operating – instead of at 4 p.m.” The chief executive of the hospital remarked that “maybe the ER patients are not as urgent as they thought they were.”

The article further reports that “People who can prove they drove through the zone for a genuine medical emergency can get a refund but that doesn’t include women in labor” to which a woman who recently had a baby at this hospital and paid the fine for driving there commented: “it wasn’t worth contesting because they really do not care.”

Stiff upper lip, you blokes. See, medical care in the sceptered isle is still free.

Coulda Worked in the Home Office, Too

Based on some of the Stupid Carrier Tricks® we've chronicled, the plight of this poor gentleman, who works for the French version of the IRS, may be more widespread than previously thought:

"A French civil servant has been found to have a huge cavity filled with fluid in his head -- yet lives a completely normal life."

It's actually a pretty interesting article, and one can't help but sympathize with the man, but the comparison was just too tempting.

"SAS" (and we don't mean Special Forces)

I have a client/friend who occasionally has too much time on his hands, so he calls to "chew the fat." I really don't often mind, because he's an interesting fellow, and sometimes I need a break, too. But this can be taken to extremes; according to Kronos ("a global provider of human capital management solutions"), some 40% of employees will call in sick this summer, even though they're actually quite fine.

[Graphic courtesy of Employee Benefit News]

Kronos calls this "taking a Bueller," a nod to the popular 1986 comedy [ed: hard to believe that film is old enough to drink]. So, with help from Harris Interactive, they surveyed almost 1,100 "employed adults" to see how many folks really do this (and/or would admit to it).

While taking the occasional "unscheduled" day off may seem harmless enough, it appears that there may well be a dark side: too many people taking too many "Buellers" could have some negative consequences in the workplace. For one thing, it means that there more honest co-workers are left to pick up their slack. For another, it encourages those who haven't indulged to do so, which sets up a precedent, and a vicious cycle.

One way to nip the problem in the bud is to go proactive: much as "Casual Fridays" ruled the 90's, identifying "Summer Fridays" (closing shop early at the end of the week, for example) could be just the firewall that's needed. And, as we saw with Paid Time Off, giving folks flexibility in the days they work can also help mitigate this problem.

I've got more to say about this, but it's Friday, and I'm not feeling so well....

More Bad Math

There's an old saw about beating a dead horse, and since we recently wrote on the topic of the mysterious 45 million, this may seem a bit insensitive. But facts are stubborn things, and when we debate the nature and severity of the "health insurance crisis," it's helpful to define and quantify it.

There is no crisis.

A crisis is defined as "an unstable or crucial time or state of affairs in which a decisive change is impending." Now, if there were truly 45 million people without health insurance (which, as we've explained ad nauseum, is not the same as lacking access to health care), then perhaps we'd have a crisis.

But there aren't:

■ The number of the uninsured who aren’t citizens is nearly 10 million on its own

■ The Census “underreported” the number of people covered by health insurance – meaning that more people have insurance than the report suggests

■ The Census also underreported the number of people covered by Medicare and Medicaid

■ (A)ccording to the same Census report, there are 8.3 million uninsured people who make between $50,000 and $74,999 per year and 8.74 million who make more than $75,000 a year

Thus, "(s)ubtracting non-citizens and those who can afford their own insurance but choose not to purchase it, about 20 million people are left – less than 7 percent of the population." So how can we seriously discuss a "crisis" when over 93% of the relevant population is covered?

But that's another old saw.

Cavalcade of Risk #30 is up!

You'll find this week's jam-packed edition at The Sentinel Effect. Our host, Richard Escow has a terrific line-up of of risk-related posts.

As Richard will tell you, it's fun & easy to host, and the little traffic-bump is nice, too. Interested? Just drop us a line!

Doc-in-a-(Bigger)-Box

Over at Trusted.MD, Philippa Kennealy has an interesting article on the burgeoning [ed: what's with that word?!] world of neighborhood retail clinics. These are more than Urgent Care Centers, less than hospital ER's, and often boast more hours than one's family physician. Dr Kennealy quotes from an article she found online, which posited that "when you talk about customer convenience, these clinics have it all over your doctor's office." That author goes on to castigate the AMA for attempting to legislate such establishments away; the theory, one supposes, is that the "medical establishment" feels threatened.

Perhaps they're justified in feeling that way, but I suspect that such legislation, if it ever does come to pass, is akin to putting the toothpaste back in the tube. These kinds of providers are popping up all over the place: not just in the neighborhood strip mall, but in WalMarts and other retailers, as well.

Abraham Lincoln once famously suggested that one should keep one's friends close, and one's enemies [ed: or perceived enemies] closer. Seems to me that "regular docs" could take a page from the upstarts, and begin to assess their own business models. This may well have the effect of reducing the cost of medical care, without a lot of unnecessary (and burdensome, and expensive; the list goes on) government intervention.

The Price is Right (Not)

Bob's pointed out that insurer's profits really have little impact on premiums (indeed, cutting out a carrier's profit altogether does little to affect the final rates). And Mike's pointed out that health insurance is expensive because health care is expensive. One might then argue that, if the cost of health care declined, the cost of health insurance might, as well.

Maybe so, but it doesn't matter.

Why not, you may ask?

Turns out, there are a lot of folks who really don't care how much health insurance (or health care) costs, they ain't buyin'. Need proof? Here ya go:

"A 50% cut in health insurance premiums would only reduce the number of uninsured Americans by 3%, estimates a Rand study out Monday, which suggests that incentives and government tax cuts won't lead to universal coverage."

That's pretty hardcore, and seems to me to put a whole new light on the nature of the "health insurance crisis." After all, is it really a crisis when 97% of the folks affected by it don't care?

And then there's the whole issue of gummint subsidies; these are touted as a way to make insurance premiums more affordable. But according to that same study, "subsidies that cut health insurance premium prices in half for people without insurance would reduce the number of uninsured Americans by just 3 percent."

That's interesting, isn't it? That "3%" keeps cropping up. In fact, it's a number that could easily reflect the actual margin of error in the study itself, which resulted from a survey of some 19,000 "new individual health care policy subscribers from January 1997 through the fall of 2001."

A Rand spokescritter, Susan Marquis, opined that "a federal requirement that all people have insurance may be the only way to achieve such a goal." That's a great idea [ed: um, no, it's not], but hardly practical: what about folks who want insurance, but don't qualify (admittedly, this is a very small subset)? Who sets the policy requirements? How does one enforce such a law, absent an actual government-run program (still dubious? Then explain to me why I need to buy uninsured motorists coverage)?

Okay, Prof, what about making policies more attractive?

I'll let Ms Maquis take that one: "(C)utting by 20% the amount of the annual deductible, which is what policyholders pay before benefits begin, would increase the likelihood of uninsured purchasing the policy by less than half a percent."

Oh.

Back to the ol' drawing board.

The article concludes with this little tidbit: "Researchers concluded that newer types of individual plans with very high deductibles may be attractive to healthy people, but are unlikely to help reduce the total number of people without health insurance."

Really? Based on what, exactly? The release offers no substantiation for this silliness, as if it's just, well, obvious. But of course it's not, and goes against other studies which show just the opposite. Those other studies were not without flaws either, of course, but at least offered some evidence. The Rand folks just toss it out there for consumption, with no critical analysis or numbers.

Seems sloppy to me.

Grand Rounds...

Just keeps on getting better and better. This week's host, 22 year old Canadian Medical student Vitum Medicinus takes an interesting approach: not content with including helpful context and a thoughtful layout, VM explains why each post is a "must-read," and even hands out "awards" based on a post's topic.

There are almost 3 dozen excellent choices, so you really can't go wrong with any of them. That said, I was particularly intrigued by Ad Libitum's post on various privacy and HIPAA issues arise when one writes about a patient or client; equally interesting, what if you're the patient or client?

Tranny Deduction

Consumer driven healthcare has generally been about price transparency and patient empowerment. We've talked about various tax advantages inherent in "alternative benefit plans" like FSA's and HSA's. These advantages flow from an IRS document (213d) which delineate what's "kosher" for such reimbursements.

Obvious expenses include prescription med's, non-reimbursed office visits, even orthopedic hosiery. Obviously non-eligible expenses include hot tubs* and ski trips to Aspen.

But what about sex-change operations?

[ed: Hunh?]

Well, hip replacement surgery is okey-dokey, as is breast-reconstruction following a cancer-related mastectomy. Wouldn't it follow, then that gender-realignment procedures would be eligible for consideration?

Well, according to those neanderthals at the IRS, the answer is "no:"

"(A) 57-year-old suburban Boston man underwent a sex-change operation. Then she [he?] wrote off the $25,000 in medical expenses on her [his?] taxes.

But the IRS disallowed the deduction — ruling the procedure was cosmetic, not a medical necessity — in a potentially precedent-setting dispute now before the U.S. Tax Court."

And there it stands; the gentleman, er, lady in question has sued the IRS, seeking to have the substantial cost of the surgery made eligible for special tax treatment. The IRS maintains that this is elective, cosmetic surgery; the plaintiff argues that it's medically necessary.

Should make for some fascinating Court TV.

[*See comments for an update]

Late-Breaking Carnival Monday

A jam-packed edition of the Carnival of Personal Finance awaits you at MintCN blog. There's an amazing 70 entries, lots of helpful categories and context, and a twist: along with each post actually submitted, the our host includes a link to the very first post on that blog. Very cool.

The Silicon Valley Blogger has an unusual post: we've all heard of discrimination based on race, or religion, or sexual orientation. But based on your name? It's for real.

Cavalcade #30: Submissions Due

Just a reminder that submissions for next week's CoR are due Monday (the 16th). Our host, Richard Eskow, asks that you PLEASE include:

■ Your blog's url

■ Your post's url

■ The post's trackback URL (if available)

■ A (brief) summary of the post

You can submit them via Blog Carnival or email.

We still have Fall '07 hosting slots available. Hosting is fun, easy, and gets you off the "nag" list. Just drop us a line!

Health Wonk Review

Fellow insurance blogger Jay Norris presents a terrific HWR. Chock full of interesting posts and helpful context, it is, as Jay notes, "the cream of the crop of recent entries in the ongoing US health care policy discussion."

Unfortunately, Jay's site (the Colorado Health Insurance Insider) is experiencing some tech problems, so the HWR seems to come and go. Hitting the "refresh" button sometimes helps; we'll let you know when it's running at 100%.

UPDATE: Well, it seems that Jay's got some of the tech issues resolved, and I was able to look through the 17 entries. They all looked interesting (and indeed, I would encourage folks to read all of them when they have the time), but Roy Poses' item on DTC goes Door-to-Door is a must-read.

Joinin' the Club...

Cato Institute Fellow Michael Cannon has a new project, and we're pretty excited to be a part of it. The Anti–Universal Coverage Club "is a list of scholars and citizens who reject the idea that government should ensure that all individuals have health insurance. It exists to challenge the idea that “universal coverage” is the best way to protect and promote health."

We were invited to join early on, and we did; it seems like a good way to judge the depth of interest on this side of the debate.

The underlying principles of the AUCC are:

■ Health policy should focus on making health care of ever-increasing quality available to an ever-increasing number of people.

■ “Universal coverage” could be achieved only by forcing everyone to buy health insurance or by having government provide health insurance to all, neither of which is desirable.

■ In a free society, people should have the right to refuse health insurance.

■ If governments must subsidize those who cannot afford medical care, they should be free to experiment with different types of subsidies (cash, vouchers, insurance, public clinics & hospitals, uncompensated care payments, etc.) and tax exemptions, rather than be forced by a policy of “universal coverage” to subsidize people via “insurance.”

Seems pretty straightforward to us, and apparently to quite a few others: in addition to IB, members include such diverse folks as the Illinois Policy Institute, big time econblogger Arnold Kling, even Andrew Sullivan (that one stopped me cold).

We'll have more on the 'Club as details become available.

[A big Thank You to Tom Tullis for the terrific graphic]

Lying with Numbers...

Over the years, we've had our own doubts about that ubiquitous "45 million uninsured." For one thing, "uninsured" doesn't mean "without access to healthcare." For another, that number has always been a "snapshot:" it's never the same (alleged) 45 million folks from year to year (or even month to month).

And now, thanks to Junk Yard Dog blog, we learn that the number itself is (no real surprise to IB readers), ahem, "inflated:"

"According to the U.S. Census Bureau, almost 45 million Americans have no health insurance...Oops, they counted non-citizens. So, what do I mean about 45 million not being 45 million? Well, the number originally came from the Census Bureau's 2005 Current Population Survey (CPS) Annual Social and Economic Supplement (ASEC), which was corrected last year to 44.8 million people without health insurance. If you read the report, however, you'll find that 9.2 million of the uninsured are not citizens of the United States."

"Ooops" for sure.

What that means is that even if we take that "45 million" at face value (which is dubious, at best), less than 80% of those are actual, real Americans. The rest are simply skipping out on the healthcare available in their own countries.

That's a big "Oops."

(More here)

Hypothetically Speaking...

We've blogged before about ethical conundrums and issues, and we've talked about how important it is to be truthful when applying for insurance.

And I believe fervently that doing the right thing is always the best choice.

One thing I would never do, for example, is encourage or condone any client misrepresenting facts when completing an insurance application. For one thing, in this age of EMR and other tech, it's just too darned easy to get "caught out," particularly when answering questions about one's own health.

Okay, Prof, so where's this heading?

Life insurance applications have always (or almost always) asked about family history: are your folks still alive? If not, when and how did they die? That kind of thing. Recently, at an online forum to which I occasionally contribute, a respected colleague discussed a recent case of his:

"So far, this person qualifies for Super Preferred. The kicker, his father passed away at age 57 of a heart attack. Now, many carriers have moved him from Super Preferred all the way down to Standard. However, there are still a few carriers that will offer Preferred and be much less expensive than the standard rates."

I've known this, of course, but for some reason I started really considering the implications:

1) What if the client had been adopted? He'd have had no way of knowing, really, whether his father was even still alive, dropped dead of a heart attack at age 32, or whatever. Does that mean he could never get super preferrred rates from certain carriers?

2) How could a carrier ever really check this? It's not like they'd have access to his father's death certificate or medical records. What if he did lie ("Dad? Oh, he was killed in a train wreck at age 92")? How would an underwriter know?

My point isn't to suggest or condone lying on an application. Rather, it's to underscore the futility of even asking the question. Yes, it's relevant (to a point): if Dad died of a stroke at age 49, then that may indicate some genetic predisposition to heart problems.

Or not.

This is one of those "gray" areas that agents (and applicants) abhor, and which carriers might be well-advised to review (and revise).

Grand Rounds

Tara Smith, Assistant Professor of Epidemiology at a university in Iowa (although she's originally from here in the Buckeye State), hosts this week's Grand Rounds. And it's truly grand: she's provided interesting categories, helpful context and gorgeous photos; who could ask for anything more? Oh yeah, and there are 3 dozen posts from which to choose.

I actually had two favorites from this crop:

Here at IB, we're all about transparency in health care (okay, that's a bit of an exaggeration, but we do spend a lot of time promoting it). The oft-unstated "other side of the coin" is the subject of Emergiblog's Kim muses on patients' responsibilities in the exchange.

And over at the Health Business Blog, David Williams has some serious questions about the relatively new, but burgeoning, "concierge" model of health care practices. He asks if some of these medico-entrpreneurs aren't using a bit of "fuzzy math" in their calculations.

It's Cool to be PC (P&C, that is)

A while back, I stumbled on a P&C (property and casualty) related blog, run by fellow insurance agent Aaron Wallrich of Wisconsin. I've been following it for a while, and find it just fascinating: a fellow cynic when it comes to carriers, with a quirky, pleasant sense of humor and self-deprecation ("Very interesting stuff for an insurance nerd like me").

If you've got an interest in seeing the P&C side of "the biz," Swift Rate is the place to go.

Carnival Monday

This week's Carnival of Personal Finance continues the trend I've grown to like: Jennifer Lynn presents a (relatively) short list of "Editor's Choice" items, followed by a list of the other submissions (most of which included helpful context).

Although I consider myself a "geek," I haven't rushed out to buy an iPhone. For one thing, I really just want my cell to make and receive phone calls, not play music, or shoot video, and I already have a Palm Pilot (all right, it's really a Clie, but I call all PDA's "Pilots"). So I really appreciated The Money Well's take on our need for "instant gratification," with the iPhone being his springboard. Interesting.

And the Carnival of the Capitalists is also up, hosted this week by The Married Cook Guy (now there's a fellow foodie!). Like the CoPF, our host chose a handful (10) of posts to highlight. While I'm pleased that we made the cut (ours is, in fact, the top post), I was disappointed that the posts that didn't weren't linked in any way. Still, that's the host's prerogative.

Since my industry seems to take a lot of grief in the profit-motive department, I found The Time and Money Group 's comparison of profit margins in different industries quite eye-opening.

Michael and Me

I haven't seen all of Sicko, just enough to make a few comments. Yeah, the production looks good technically but basically, I think the movie should be no more relevant than, say, Hunt for Red October to an intelligent discussion of the issues of health care and health insurance. Why do I say that?

Because the undeniable fact is that insurance is expensive because health care is expensive, not the other way around. Does Moore say that? No he does not. The cost of insurance is rising because the cost of health care is rising. Does Moore say that? No, he does not. The high cost of insurance is a symptom of the deeper problem of health care costs – and if our nation cannot solve the deeper problem, we will never be rid of the symptom. Does Moore say that? No, he does not. He’s pecking around the fringes, not facing the problem itself. Worse he does not clearly articulate the problem as either health care or health insurance. Sorta like some people in Colonial times, he’s stuck a feather in his cap and called it macaroni. Of course what one sees is nonsense on stilts. But it is what it is.

So Moore confuses the difference between health care and health insurance – I think deliberately, since Moore is not a stupid man. Confusing these two hides the real problem. It ends up feeding people’s fears that they cannot afford “health care” because they can’t buy insurance when the truth is that most of us can’t afford health care because HEALTH CARE costs so freakin much!

IMO, what Moore is selling will screw us. And because I think he knows exactly what he is doing, I see him less as an advocate and more as a pimp. By pushing confusion about the deeper problem, Moore in fact is an impediment to understanding. That is why I say, the movie should be irrelevant to an intelligent discussion. Should be. But won’t be. Won’t be irrelevant because the discussion is driven by naivete, ignorance, fear, and cynical politics.

It is a natural human temptation to minimize the importance of facts one doesn’t want to be true, especially when the facts reveal problems that are very difficult to solve. In this case, I believe that the people who are most pleased with Moore’s movie don’t want certain facts to be true. Think about our government's biggest existing health insurance programs - Medicare and Medicaid. Facts are, these programs are rapidly being crushed by the cost of health care (Medicare alone has a $60 Trillion unfunded liability) and are far from effective in meeting the needs of the elderly and poor populations because of fraud, waste, federal budget politics, political corruption, organizational inflexibility, bureaucracy, and the massive amount of law & regulation that governs everything they do. Add to that the health costs driven by our own unhealthy behaviors; we are becoming a population that refuses to take responsibility for our own health except as it can come in a pill-bottle or operation that we demand someone else pay for.

Is there a single reason to suppose that these problems would go away - that our government could do a "better" job with health insurance - if only the government controlled all of it? I think the answer is obvious. No, it could not.

Many of the same people who prefer not to talk about the very real problems in our present government insurance programs, also don’t want to take seriously the problems and occasional failures in other countries’ health insurance schemes. As though if they were to admit there might be a problem elsewhere, the cause of attaining the universal health care in this country would be derailed. Is universal health care such a fragile patient that it cannot stand an honest examination?

IMO, an unwillingness to consider forthrightly the problems that all governmental insurance systems do have is a major obstacle to designing a plan that has a chance of being a “solution”. It is an obstacle because it gets in the way of clear analysis. Instead we hear far too many ad hominem attacks, or appeals to false authority, or fallacious logic, or the old chestnuts “everyone knows” and “this is a no-brainer” not to mention the usual litany of complaints about the cost of insurance, all the while ignoring the cost of health care that is responsible for the high cost of insurance.

BTW, I favor universal health care. I also favor universal health insurance to help pay for health care. There is a lot of work to do because wishing does not make it so. I do not confuse health care with health insurance. I believe that the linkage of group health insurance with one’s employment, while a useful tactic for decades, has outlived its usefulness and it’s time to re-think. At the same time, I believe that any universal insurance scheme whether public or private CANNOT succeed in this country, unless the costs of health care can be reduced and the annual rate of growth in those costs is brought under meaningful control. I favor a substantial role for the private insurance sector in any universal health insurance scheme - as in France, or Germany, or Chile or other countries. IMO, a basic public insurance plan that can be supplemented by private insurance is a reasonable approach and a preferable alternative to the enormous bureaucracy that results within a fully-centralized health care and insurance system such as in the U.K. And, of course, I think that Moore’s movie should be irrelevant to an intelligent discussion of the issues with either health care or health insurance in this country.

Flooding across the Pond

From time to time, we like to dabble a bit in the P&C (property and casualty) side of "the biz." This includes items like auto, home and liability insurance, as opposed to our regular fare of life and health.

About two years ago, we participated in the blogosphere's efforts to help victims of Hurricane Katrina (which project, apparently, was more successful than our own gummint's). And while that was a terrifically satisfying endeavor, we never underestimated the vast reserves and dedication of the P&C "cat" teams who slogged through the devastation, dispensing help and, more importantly, cash.

At the other end of the spectrum, Britain's NHS (National Health System) has been the target of more than a few of our posts, and rightly so. But our English cousins haven't (yet) nationalized their P&C industry, which is now trying to cope with floods that compare to that which we saw in NOLA. Apparently, the Brits' carriers are up to the task, but an interesting question arises:

"So why do one in four people, almost a third in Scotland and London, take a risk and not insure their contents?"

That's a lot of uninsured folks, many of whom now face financial ruin, displacement and worse. Some, of course, are just natural risk-takers, and we have many of our own of this ilk here in the 'States. For others, it's a matter of economics: if you can barely afford to eat, then insurance premiums are probably not high on your list of necessary purchases. I'm not sure I entirely buy that: the premium quoted in the Times article, £200 (about $400) a year, works out to less than $10 a week, which doesn't seem overwhelming.

Which gives rise to the real questions:

"Should we save them when the floodwater rises? Or do we stand purse-lipped at their lack of providence, as the loss adjuster with his clipboard sanctions our new suite?"

Tough choices. What was that about stiff upper lips?

Very Cool Web Tool

FoIB Chris Parks has a (relatively) new web tool, Find Your Doc. It's fast, easy, and free.

Have you forgotten your doc's phone number? Been traveling and need the name of a local cardiologist? Go to FYD, type in a name, or city, or a specialty (or any combination thereof), and voila! (French for "violin!"), up pops name, address and phone number.

Very cool, and very useful.

Cavalcade of Risk #29 is up!

Wenchy, hostess of Wisdom from Wenchypoo, has this week's Cavalcade of Risk. She's got over a dozen risk-related posts. Please check it out.

And consider hosting a Cav yourself; Wenchy can tell you that it's easy, fun, and a nice traffic bump. Just drop us a line to sign up.

Happy Independence Day!

To all of our readers, please enjoy a fun (and safe) holiday!

God Bless America and those who serve her.

(For truly patriotic/geeky IB readers, these folks are actually live-blogging the Continental Congress as it ponders its options. Fascinating)

The Terror/Medicine Connection

[Welcome Industry Radar readers!]

Bob's been taking a lot of heat for the title of his recent post about the dangers of nationalized health care, and amidst that kerfluffle, I think a number of important issues have been left unaddressed by those who object to that title.

First, although we're a medblog, not a poliblog (political blog), there are some undeniably political undertones to the subject at hand. For example, those who feign offense at the term "terrorism" when applied to health care seem to have missed the fact that, daily, much of our "regular" media call those who blow up others "insurgents," or "militants," but rarely (if ever) "terrorists." So I not only don't think that the word is overused; if anything, it's not used enough.

Second, although this seems to have gone unremarked in the medblogosphere, many (perhaps most) of those involved in the recent terror attacks in Great Britain have themselves been physicians. One supposes that, for them, the Hippocratic oath has a somewhat unusual application:

"Five of the eight people under arrest last night are said to be doctors. Another of those detained is the wife of one of the doctors, who is a medical assistant working for the NHS. The home of a sixth doctor is said to have been searched by police."

In fact, all of the physicians involved were employees of the National Health Service. Now, whether or not it's fair to indict the entire system for the actions of a few may be up for debate, but it's no coincidence that these folks were doctors for the NHS: for some time, medical personnel have been "fast-tracked" for immigration into Britain (as they were here, as well, in our 9/10 world). One is free to draw one's own conclusions from this set of facts, of course, but it should certainly mean that the discussion is relevant.

And necessary.

A Patriotic 'Rounds

Over My Med Body brings us this week's Grand Rounds, a thoughtful (and irreverent) collection of the best medblog posts of the past week or so. Our host is a 3rd year medical student who took time away from his/her studies to put together this week's 'Rounds, complete with video, graphics and helpful context.

With over 3 dozen interesting entries, it was a challenge finding a "best of," but this post at Junk Food Science blog touched a nerve: hostess Sandy Szwarc has some disturbing news from Britain's National Health Service.

It's not pretty, but it's pretty important.

Massive Mass Ifs (Part 1)

Here's the dilemna: on the one hand, I'm generally a pretty upbeat kinda guy. On the other, I'm also a pragmatist, so when I read about massive government programs that purport to solve a problem, it's second nature to ferret out what new problems the original "solution" created.

So what's my point, you may wonder? [ed: um, yeah!]

We've written extensively about the "new" Massachusetts health insurance initiative (here, here, and here, for starters). One of the overarching themes we've addressed is that mandatory coverage without significant, realistic inducements is a non-starter. We can see that happening already, because the Mass Health Plan officially "kicked in" yesterday (July 1st).

The response appears to be underwhelming: "since October, about 130,000 have enrolled in an expanded Medicaid program or insurance that offers free or subsidized care to the poor." D'uh! But the problem is that "free" isn't the same as "mandatory," and adding more "freeloaders" to an already strained Medicare system will inevitably lead to even more taxes. Vicious cycle, indeed.

But wait, it gets better (or worse, depending on one's perspective): Most folks get their insurance through their employers. In Massachusetts, employers are now required to offer health insurance (to the tune of thousands of dollars per year for each employee), or face a devastating fine (less than $300 per employee per year). Gee, I wonder how that's going to play out [ed: cynic!].

USA Today's article gives us some real world numbers to explore, which turns out to be pretty helpful: "Glen Baker, who runs five Wendy's restaurants with 140 employees in the state and offers health insurance to his workers" asks "(w)hat's this going to do to me?" Here's how his insurance premiums work out:

Single employees pay $180 per month, and those with dependent coverage fork over $540. Not too hateful, right? But that's only half the story (well, technically, less than half): those number represent only 45% of the total premium So single cover really costs $400 a month (of which Baker's company pays $220), and family cover is a whopping $1,200 (with the employer paying well over $600). Let's do the math: $220 a month, or $300 a year? $660 a month, or $300 a year? Einstein isn't really necessary here.

In Part 2, we'll look at how those subsidies really work.

Or don't.

Personal Finance...

This week's Carnival of Personal Finance is now up, hosted by the nice folks at Blogging Away Debt. There are over 70 entries, and our hostess has tried something new: a half dozen or so "editor's choice" posts, complete with excerpts, top the list, with the remaining entries available below them.

At first, I found this a bit off-putting, but then I recalled something I wrote a few weeks ago about how unwieldy these things (carnivals) have become. I suggested that those who run the carnivals "give the host some editorial discretion and specific guidelines, and tell them to pick the best (most relevant?) 15 or 20 for the actual Carnival, but provide a listing of all the other entries." And this one certainly follows that blueprint.

One would think that with over 6 dozen (half a gross!) entries, it would be difficult to pick a favorite.

One would be wrong: how could I resist a post on money-related limericks? I couldn't, and I bet you'll sport a smile, too. Mad Kane's has the winners of its 3rd such contest.

Prepare to smile.