Read it? Heck no - Just pass it!

From the "Have to Pass it to Learn What's in it" Files:

"Older adults of the same age and income with similar medical histories would pay sharply different amounts for private health insurance due to what appears to be an unintended consequence of the new health care law."

Well first, I take great issue with the assumption that this was, in fact, "unintended." After all, the whole point of the bill was to increase the disparity of who pays what for health insurance, with the ultimate aim to dilute the coverage of currently insured folks in favor of those who have chosen to abstain from purchasing it.

The "glitch" in question has to do with how some "younger older" adults (between ages 62 and 65) can elect to take early retirement and receive tax-payer assistance with premiums (of course, those of us paying the actual tab get no such break). In fact, those "younger older" citizens who must continue to work are actually penalized for doing so; as Bob Laszewski notes:

"If you get a job for 40 hours a week, you're going to pay more for your health insurance than if you don't get a job."

Of course, HHS Secretary Shecantbeserious is hot on the case:

"The Obama administration says it is working on the problem."

Why doesn't that make me feel any better?

Something Different: Maritime Insurance and Terrorism

Insuring a commercial ship requires a special type of coverage, generally available from carriers that specialize in this area of the biz (Lloyds' syndicates come to mind). Unlike, say, your average home or car policy, there are very few carriers willing (and/or able) to take on this kind of risk. They assess various factors, including potential liability, which can come in many different forms.

Such as this:

"[C]ompanies that have insured the ships that have been assembled to sail to Gaza to break the blockade of the Hamas-run strip [may be] leaving themselves open to prosecution for aiding terrorists"

This is in response to the terrorist-enablers behind the various Gaza-bound flotillas, but represents an apparently novel way to make a point: go for the insurer as the first domino.

There's no guarantee that this ploy will have any effect, but insurers are generally not keen to pile on additional, and perhaps costly, risks for which they haven't accounted.

Cavalcade of Risk #134 now up

Julie Ferguson presents this week's epic collection of risk-related posts. With security theatre, zombies, cats 'n cars & more, what's not to love?

Dodging the (Tax) HIT

This morning's email brought a link to this HIT piece [ed: /groaner!] on the so-called Health Insurance Tax portion of ObamaCare©:

"A hidden tax known as the Health Insurance Tax, or HIT, which will increase health care costs and threaten our ability to grow and create jobs ... and will have a direct impact on businesses and their employees’ bottom line."

No kidding.

Mr Plemmons, the Executive Director of the Council of Independent Business Owners, continues:

"The tax was originally intended for insurers, but the small businesses, their employees and the self-employed who purchase health insurance on the fully-insured market will be the ones paying the bill."

I repeat: No kidding.

Insofar as he characterizes the net impact of the HIT on the economy, I of course agree with Mr Plemmons' analysis. But I find it distressing that the very folks who purport to represent the interests of "small business" are unable to grasp a core issue at the heart of their advocacy, to wit: insurers (which are, of course, business themselves) and other businesses (large and small) do not pay taxes.

We covered this almost 5 1/2 years ago:

"Companies do not pay taxes, and they do not pay for health insurance."

This obvious point seems lost on Mr Plemmons, which is a shame, because it represents a missed opportunity to address other substantive issues with the HIT. These include "upwards of $90 billion in additional excise taxes," a point we made when we first noted the "Stop The Hit" campaign last month. I'm all for dodging that particular HIT, but please let's keep the rhetoric accurate, and thus credible.

Shecantbeserious Goes on a Medical Mystery Tour! [UPDATED]

Our favorite guest-blogger, Certified Medical Office Manager Kelley Beloff, is back, and has the scoop on the real life implications of the latest ObamaCare© goofiness: Medical Mystery Shoppers:

As part of my daily readings for my job as a medical practice manager, I came across this article from the New York Times, “U.S. Plans Stealth Survey on Access to Doctors.” The article discusses how the United States Government is going to use mystery shopping techniques to assess the wait times for new patients to get into a primary care physician’s office and if patients on Medicaid are treated differently from those with private insurance.

“Alarmed by a shortage of primary care doctors, Obama administration officials are recruiting a team of “mystery shoppers” to pose as patients, call doctors’ offices and request appointments to see how difficult it is for people to get care when they need it.”

Then the article prints out the script that will be used.

After I fell out of my chair laughing, I decided I needed to point out the error of the government’s ways.

This is how the government has the phone call playing out:

“Mystery shopper: “Hi, my name is Alexis Jackson, and I’m calling to schedule the next available appointment with Dr. Michael Krane. I am a new patient with a P.P.O. from Aetna. I just moved to the area and don’t yet have a primary doctor, but I need to be seen as soon as possible.”

Doctor’s office: “What type of problem are you experiencing?”

Mystery shopper: “I’ve had a cough for the last two weeks, and now I’m running a fever. I’ve been coughing up thick greenish mucus that has some blood in it, and I’m a little short of breath.”

In separate interviews, several doctors said that patients with those symptoms should immediately see a doctor because the symptoms could indicate pneumonia, lung cancer or a blood clot in the lungs.

Other mystery shoppers will try to schedule appointments for routine care, like an annual checkup for an adult or a sports physical for a high school athlete. “

This is how the actual call will go:

Mystery shopper: "Hi, my name is Alexis Jackson, and I’m calling to schedule the next available appointment with Dr. Michael Krane. I am a new patient with a P.P.O. from Aetna. I just moved to the area and don’t yet have a primary doctor, but I need to be seen as soon as possible."

Doctor’s Office: Dr. Krane is booked out for new patient appointments for three months. Before I can schedule you I need some information. What is the name of your insurance? Are you the subscriber? I need your social security number, birthdate, ID number on your insurance card and your employer for our insurance verification.

Mystery Shopper: "Listen, I just need to see a doctor. I have been in area for four months and I didn’t need a doctor until now, so just schedule me."

Doctor’s Office: Sir, you do not need to take that tone of voice with me. By federal guidelines in the HITECH Act, all physicians’ offices must verify insurance before any person can become a patient. Additionally, by the rules in the Red Flag rule, we must determine that you are you and not using a fraudulent insurance card. Now, if you would like to continue the initial intake…

Mystery Shopper: "I cannot believe you are treating me like this, I’ve had a cough for the last two weeks, and now I’m running a fever. I’ve been coughing up thick greenish mucus that has some blood in it, and I’m a little short of breath."

Doctor’s Office: Sir, did you go to the emergency room?

Mystery Shopper: "Why would I go to an emergency room, do you know the wait times there. I just want to see the doc and get some meds, why can’t you understand this simple request."

Doctor’s Office: Sir, it takes at least three days to verify insurance and as I said the doctor is booked out for new patients for three months. At this point I recommend that you go to the emergency room and then please call us back to start the process of becoming a new patient.

Mystery Shopper: "Listen, I can do the new patient appointment later, can’t I just come in to be seen?"

Doctor’s Office: Sir, I am sorry but by federal guidelines, all patients not seen by a physician in three years must be seen as a new patient. Our office is contracted with Medicare and these are the rules mandated by CMS. We will have to see you as a new patient and the doctor does not have any openings for three months. I must insist that you go to the emergency room. Sir your symptoms are very severe.

Mystery Shopper: "Listen, how about if I just pay you cash, that way my insurance company won’t know that I was seen."

Doctor’s Office: Sir, under federal guidelines I cannot have you pay for an appointment if we are contracted with your insurance company for a discounted rate. That is fraud under CMS guidelines.

Mystery Shopper: "Un freakin believable, so what I am supposed to do, just die. I cannot believe you people." CLICK.

The reason for the appointment is not relevant at this stage; the reality is that physicians are booked out for new patients anywhere from two months to six months. If an established patient called me with those symptoms, the physician would tell that patient to go to the ER. Physician’s offices are not the site for this type of problem.

The article continues:

“To make sure they are not detected, secret shoppers will hide their telephone numbers by blocking caller ID information.”

To ensure against identity theft, one of our first lines of defense is a phone number. If a new patient calls with a blocked number then we become suspect of the true intentions of the person calling. In gathering information to make a new patient appointment, a physician’s office will require an address, phone number of home, work and cell, as well as employment status.

And then there is this paragraph:

“Eleven percent of the doctors will be called a third time. The callers will identify themselves as calling “on behalf of the U.S. Department of Health and Human Services.” They will ask whether the doctors accept private insurance, Medicaid or Medicare, and whether they take “self-pay patients.” The study will note any discrepancies between those answers and the ones given to mystery shoppers.”

No reputable physician’s office will give out this information to a stranger. If I received this phone call I would ask for a name and reason for this request, since all physicians taking Medicare or Medicaid have already registered with the U.S. Department of Health and Human Services, thus this is a scam phone call.

“Federal officials said the initial survey would cost $347,370. …Jennifer Benz, a research scientist at the center, said one purpose of the study was to determine whether the use of mystery shoppers would be a feasible way to track access to primary care in the future.”

Ms. Benz, let me save you some time and our government some money. This will not produce the results you are seeking. I can give you your answer for free. There is a shortage of primary care physician’s because the payments from insurance companies, the government included, are too low. In fact, in another posting today, I came across this article which details physicians compensations by category. Family Practice is dead last with a compensation of $178,000. The average compensation of $65.87 from an insurance company to a doctor for a mid-level office visit will not motivate physicians to go into primary care. The compensation has been stagnant for over a decade and it is doubtful that any primary care physician will ever get a raise.

My practice’s specialty is not on the list for the phone calls, nor is Ohio listed as one of the States where calls will be made, but if I do get one of these phone calls it will make my day.

Thanks, Kelley!

UPDATE: Under intense pressure (ie someone finally figured out how bad this looked), HHS Secretary Shecantbeserious (et al) has apparently decided to deep-six the program.

Exit question: how much did this little escapade cost the taxpayer?

Grand Rounds, Colorado-style is up...

Louise Norris hosts this week's collection of interesting medblog posts, complete with vintage pictures that really capture the mood.

Google It! (Or not)

From the Time Flies Dept: Over three years ago, we reported on Google's EMR (Electronic Medical Records) initiative "Google Health," which was touted as "a long-anticipated U.S. health information service that combines the leading Web company's classic search services with a user's personal health records online."

Partnering with Walgreen's and CVS, not to mention the highly esteemed Cleveland Clinic, the effort was meant to bring the efficiency of data warehousing to the health care field.

So, how's that working out?

About as well as might be expected:

"Google is giving up on its vision of helping people live healthier lives with online personal health records. ... Google Health never really caught on."

To some extent, that's a hazard quite common to path breakers, and the search engine giant (and its partners) faced a significant field of competitors, not to mention a natural reluctance on the part of us patients to entrust our private health information to the vagaries of tech.

The true reason, though, may be much simpler. According to a former Google Health manager, most folks weren't too enthusiastic about typing in a bunch of personal information:

"In the end ... it was an experiment that did not have a compelling consumer proposition.”

No kidding.

[Hat Tip: Bob V]

Swedish Meatball MedCare & Scottish Non-Care

Over the years, we've chronicled the (mis)doings of the MVNHS© and CanuckCare. Some critics have asked why we don't focus as well on more...ahem..."successful" national health care systems, such as Sweden's. Aside from the fact that America is more culturally akin to Great Britain and Our Neighbors to the North©, there's the rather striking fact that Sweden's health care scheme is not exactly a paragon of virtue.

And now, the Swedes have proven once again that their system is, in fact, broken:

"After sustaining an open chest wound of 10cm long while trimming her horse’s mane, Sweden’s emergency response services refused to send an ambulance, suggesting the 11-year-old girl take aspirin instead." [ed: 10cm~4"]

The girl's mother called the Swedish equivalent of 911; the dispatcher refused to send an emergency response team and instead suggested that mom simply dress the gaping, bleeding wound and give her daughter an aspirin.

Great bikini team, not-so-great health care.

And speaking of the MVNHS©, we would be remiss if we missed noting the sage wisdom of Dr Brian Keighley, who chairs the British Medical Association Scotland. Which is nice for him, but maybe not so nice for his (and/or his colleagues') patients:

"The leader of Scotland's doctors has questioned whether society can afford to pay thousands of pounds to keep terminally-ill people alive for weeks or months ... the GP said the country had to debate the merits of these kinds of aggressive treatments and the effects they had on the NHS budget."

Indeed.

But don't you dare say "Death Panels."

Or else.

Risk Management and Floods

The good people of Minot, ND may be forgiven for allowing their flood insurance policies to lapse:

"When the federal government lifted a requirement a decade ago that low-lying valley homes have flood insurance, most residents stopped buying it."

Now, one may argue that, just because the gummint doesn't require you to purchase flood insurance (as opposed to health insurance, of course), doesn't automatically mean that it's not a good idea to do so. But that same government, courtesy of the U.S. Army Corps of Engineers, has spent the past 6 decades ensuring that the Mighty Missouri would and could be controlled through a series of dams and levees.

Unfortunately, snail darters (or whatever) have now taken precedence over human lives, industry and livelihoods:

"The Corps began to utilize the dam system to mimic the previous flow cycles of the original river ... On February 3, 2011, a series of e-mails from Ft. Pierre SD Director of Public Works Brad Lawrence sounded the alarm loud and clear."

The net result: lives endangered, valuable crops destroyed, houses washed away.

And, of course, many (most?) of these losses are uninsured because the people believed that the Engineers worked for them, not the snail darter.

Which is not to let those folks completely off the hook: if you own something valuable, then it often makes sense to mitigate the risk of its lost by purchasing insurance to cover it.

Stupid Client Tricks: P & C Edition

So, your car sits idle (but hopefully not idling) 22 hours a day. Your car payment and insurance meters, though, run 24/7. Wouldn't it be great if there were some way to turn that down-time into cold cash?

Turns out, there just might be, but there's a catch. Actually, there are a lot of catches.

Here's the scoop:

Yesterday's McPaper featured a front-page item on "personal car-sharing:"

"Seeing a business opportunity in millions of cars that sit idle at office parking lots or on weekends, several start-up companies have introduced "peer-to-peer" car-sharing services ... Renters pay typically $5 to $15 an hour for a car in their neighbor's garage or office parking lot."

It goes like this: Jim's newish Saturn sits in the parking lot all day, and Bob needs to run some errands out in the 'burbs. Bob signs up with (for example) Getaround, to which Jim is also subscribed (as a vehicle provider). Getaround charges Bob $10 an hour for the use of Jim's car, which it then splits with Jim. Win-win-win.

Or is it?

This is a blog about insurance, after all, and there are a host of issues with this seemingly simple and convenient new business model. Unlike a regular rental car service, Getaround doesn't own the vehicles. And since these are private passenger automobiles, they're covered by private passenger automobile insurance. Thanks to my friend Bill M, I was able to score the relevant portions of a typical auto policy (YMMV):

"Exclusions:

... to any automobile while used as a public or livery conveyance." [emphasis added]

Now, this doesn't apply to "ride-share" or other car-pooling arrangements. But the Getaround model isn't a car-pool: you're renting out your car, and that changes the risk in a myriad of ways.

When you bought your policy, you agreed to the coverages and exclusions in the policy, and also to your own (minimal) obligations, one of which is to inform the carrier of a "material change" in the risk. Those of us with teenagers are well-aware of how this works: you can't just neglect to tell your insurer that your 16 year old son is now driving the family station wagon minivan and expect them to pay up with no fuss when it gets totaled. Likewise, renting out your car to someone you've never met (and will probably never even see!) is a dramatic change in the nature of your insurance policy's risk.

Which then raises all kinds of issues:

First, let's say that you've already bought insurance, and then you sign up with Getaround. If you call your agent and tell him, the likelihood is that the policy's going to be canceled, because you now need a commercial lines plan.

Let's say you don't call him: what are the odds you're going to be a happy camper when Bob totals your car into the side of a schoolbus full of elementary students?

Then there's this: you've now dramatically restricted your ability to shop around for new coverage. Again, if you don't tell the new carrier, then you've lied on the application (a bad idea, and a felony). If you do disclose it, you're going to be looking at some major premiums for a commercial policy.

California recently passed (and Oregon is poised to pass) a law forbidding carriers from dropping drivers who engage in car-sharing. That seems great on paper, but again, Bill M points out that this will have one of two outcomes: either carriers will flee the state, or they'll raise everyone's premiums to make up for the increased risk.

At least one of the carshare companies provides liability coverage to the renters. That's nice, but anyone that thinks that the parents of the kids in the aforementioned schoolbus aren't going to be coming after the car's owner is definitely inhaling.

In perhaps the stupidest comment I've read in a long time, Getaround's CEO avers that "[o]wners' insurance carriers are not liable for anything that happens during the sharing period. Consequently, it should be no impact to owners."

Rotsa ruck with that, Mr Zaid.

Cavalcade of Risk #134: Call for submissions

Julie Ferguson hosts next week's CavRisk. Entries are due by Monday (the 27th).

NB: We're now using this submission tool: The BC WorkAround

Once there, you'll be asked to provide:

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

At the bottom of the form, you'll see a drop-down menu; simply select "Cavalcade of Risk" then press "Submit" and you're good to go.

And PLEASE remember: ONLY posts that relate to risk (not personal finance tips and the like).

The ObamaPool©: Rest Period!

It's important to remember that, when we "passed the bill to read what's in it," we were told that some 4 million people would be jumping into the state-run ObamaPools©.

Would that it were so.

Talk about underselling:

"Barely a dozen Mainers have signed up for an insurance plan that covers pre-existing conditions, which has been available in the state for nearly a year."

Remember, this is highly subsidized coverage, which includes pre-existing conditions including maternity, at reasonable rates and no underwriting or exclusions for pre-existing conditions.

The underwhelming result?

"[O]nly 14 people have subscribed to the plan"

That's out of a total population of over 1.3 million people. If we take the (debunked) figure of (say) 15% uninsured, then we're talking about a potential client base of almost 200,000 people, of which a grand total of a baker's dozen + 1 have availed themselves.

Or, as the gummint might say, "success!"

DTC explained

Direct to Consumer (DTC) advertising has been a pharma staple for quite some time. We've all seen them; heck, most of us could probably parrot back key points ("for more than 4 hours," "nausea, dizziness, constipation," "if you're pregnant or may become pregnant," the list goes on).

Some folks have finally had enough, and produced this video template for pretty much every DTC campaign you can think of:

Health Wonk Review, "Big Men" edition is up...

Tinker Ready hosts this week's roundup of thoughtful posts on health care policy and wonkery.

Thursday Morning Linkfest

■ FoIB Holly R sends us this tidbit, the truthfulness of which I can confirm from personal experience:

"Staying out of [the] hospital is cheaper and safer ... One in three hospital patients experiences an adverse event."

This makes sense, of course: after all, there's lots of sick people there.

■ My better half recently started a new job helping an insurer with IT issues. It's something we tend to take for granted: home office tech includes not just rating tools, but secure systems to handle sensitive personal data, in-force policy info, and more.

Stephanie Majercik recently emailed us some results from a recent Oracle Insurance survey about insurers' top concerns. The results were interesting:

Insurers struggle with business agility and see their legacy IT systems as a hurdle to optimizing customer service and faster time to market for new products and channels

Insurers feel hindered by current technologies in their efforts to deliver efficient customer service

There's more, but the bottom line is that, at least for major players, the breath of new tech is breathing heavily down their necks.

■ Finally (for now), Lab Tests Online is a web-based, non-commercial tool here you can plug in the names of various tests and learn what the doc's are really looking for. They recently celebrated a couple of important milestones, "reaching its 10th anniversary and hosting its 100 millionth visitor."

Kudos, LTO!

What are they smoking?

So, Jennifer Arnold of Avalere Health ("a leading advisory company focused on healthcare business strategy and public policy") tips us to their recent study which claims that, contrary to all actual evidence, ObamaCare© won't disrupt the commercial insurance market. Or, as Avalere so quaintly terms it, "Employer Sponsored Insurance (ESI)."

According to the brain trust at AH (LLC!), "the ESI market will be fairly stable after 2014 when key ACA coverage provisions go into effect, primarily due to stability in offer rates among large employers."

As Mike so succinctly puts it, "Stable as in "assume room temperature" ??

I think that's about right.

Flying in the face of logic, common sense and the stated intentions of the actual subjects of their predictions, AH (LLC!) avers that "large employers are more likely to take a “wait and see” approach on coverage."

Really?

Of course, they then go on to completely negate their entire argument with this little gem:

"[ObamaCare©] will have differential impacts on ESI depending on factors such as firm size, composition, and sector."

No kidding?

UPDATE - Piling on: By the way, it's not just lil ol' us that makes the case against AH's specious claims. No less than the President of the Federal Reserve Bank of Atlanta, one Dennis Lockhart, notes that:

"We've frequently heard strong comments to the effect of "my company won't hire a single additional worker until we know what health insurance costs are going to be."

Amen.

It's all in the Genes

Cancer treatment continues to be an expensive and difficult proposition. One of the main challenges is the diagnosis itself, and of course treatment protocols run a large gamut. One particularly promising avenue has been the use of genetic testing in determining a particular cancer's origin. This kind of testing is often (generally?) excluded from coverage under most health insurance plans (and perhaps rightly so, but that's another post).

But this may be changing. I recently received an email from Ed Stevens of Pathwork Diagnostics, a "privately held molecular diagnostics company focused on oncology." They've been working with SelectHealth (a nonprofit health insurer) to find better ways to help folks identify primary tumors.

In the event, SelectHealth has apparently become the first carrier to cover Pathworks' new "Tissue of Origin Test." This is significant because better diagnostics can mean better outcomes, which is beneficial both to the insured and the insurer.

In related news, the test has now also been approved for coverage under Medicare, a first for this type of test. Potentially life-saving good news for seniors.

Grand Rounds is HOT!

Shrink Rap hosts this week's sizzlin' round-up of great medblog posts. I really like the way it's laid out, with summaries PLUS excerpts. Looks like the Shrink Rap folks are en fuego!

Punishing the Good Guys: An Update

About a month ago, we reported on the travails of Bill and Mary, two hard-working folks who played by the rules and, as a result of circumstances beyond their control, were punished for doing so. Specifically, Mary is not eligible to take a dip in the Ohio ObamaPool© because she was recently insured. She was left with few options, none of them particularly appealing.

Recently, Bill learned about an "exciting new insurance" product that promised to cover Mary's health woes. But he had to act quickly (within 24 hours!) because "open enrollment" for this plan ended the next day ("the 17th!").

First, no legitimate insurance carrier ends "open enrollment" on anything other than the end of a given month. Second, any kind of "deal" is going to be a deal the day after tomorrow, too, else it's not really "a deal" at all. My colleague knew this when Bill came to him for advice, and was promptly referred back to me to confirm that this wasn't what it appeared to be. I'll give Bill credit: he did call me, and listened as I explained all the tell-tale signs of a rip-off.

And, of course, our words fell on deaf ears.

And why shouldn't they have? What, after all, did we offer as an alternative? What safety nets existed to help Mary? As my colleague mused, "of course he was grasping at straws, we can't give him a drink."

Indeed.

Bladder up!

I've always subscribed to the conventional wisdom that emptying a full bladder as soon as (practically) possible was always the "way to go."

But new research seems to pour cold water on this idea:

"New research shows that seemingly trivial things, such as the fullness or otherwise of your bladder, have a huge influence on the way you make decisions."

Who knew?!

The question, though, is whether or not to avail oneself of "the facilities."

Turns out, the answer's no:

"Long-term decisions made on a full bladder, the research showed, will be more rational than those made while running on empty"

Good to know.

MVNHS©: Into the Breach

For those still skeptical that government-run health care means rationed health care, here's a little somethin' to nudge you along the road to reality:

"Official figures for April showed 51 trusts - a third - missed the target for 90% of patients to be seen within 18 weeks ... The target for hospitals to see 90% of patients within 18 weeks was to reflect the fact that there needed to be leeway ... Nationally, 90.5% of inpatients ... were seen within this time in April."

It was difficult finding a corresponding stat for American patients - pretty much every study focused on ER wait times - but I did find this little nugget, which at least offers some perspective:

"A 2009 study found that on average the wait in the United States to see a medical specialist is 20.5 days."

The point here is that those who think that shifting to a system run by the Feds is going to magically and drastically improve care are definitely inhaling. Key metrics which we take for granted are noticeably worse under the MVNHS©:

"In the worst performing area - Hastings and Rother - more than a quarter of patients were waiting longer than 18 weeks."

But the "money quote" is right here:

"The problem has been put down to the squeeze in budgets that the NHS has seen in the past year."

So let's sum up: less care, longer waits, more expensive.

Now what does that remind me of?

ObamaWaiver© Mania Waning? [UPDATED & BUMPED]

Maybe so:

"The Obama administration says it will end a controversial health care waiver program in September.

Officials announced Friday that all applications for new waivers and renewals of existing ones have to be in by Sept. 22."

Considering that the program wasn't even in the bill we had to "pass to see what's in it," this is quite an accomplishment.

As it became more and more obvious that these were handed out as door-prizes to favored groups (ahem), it's become an ongoing bone of contention among those of us who, perhaps naively, expect a modicum of transparency and (dare I say it?) fairness in the way laws are implemented.

Of course, this administration has a history of reneging on its promises, so who knows whether or not they'll actually peter out this fall.

Bob Adds [6/18/11]: Check out the number of folks who had their application denied but then received approval on appeal.

Bark, Screech, Yowl!

Try as I might, it's difficult to imagine a more useless, bigger waste of money than auto accident coverage for one's pet:

"(A)n auto insurer's pet-injury coverage typically kicks in if a pet is traveling in your car, is injured in an accident and needs veterinary care."

Seriously?

This is not to be confused with regular ol' pet health insurance, which can help pay more typical veterinary bills. What it reminds me of more than anything is what we used to call "accident plans," which paid a specific sum if one had (for example) a broken arm or the like.

Apparently, this coverage has been available since 2007 for customers of Progressive Insurance, and now Chubb and Arbella Mutual Insurance have introduced their own versions.

The coverage runs about $20 a year for a $500 benefit. Granted, we're not talking big bucks here, but this seems like a colossal waste of a double-sawbuck.

Unless, of course:

Immigrants, Babies and the MVNHS©

"Walk into Ealing Hospital and you could be forgiven for thinking you were in a foreign land ... new figures revealed that 80 per cent of the children born at the West London hospital over the previous year were to foreign nationals."

And it's not just labor and delivery costs, either:

"(A) team of translators, funded by the taxpayer, has to be on hand around the clock."

And now to the crux of the matter:

"(R)enewed concern that the NHS is being overwhelmed by an influx of foreign mothers keen to take advantage of free healthcare."

Sound familiar?

The fault here lies, atypically, not with the MVNHS©, but with the British government's immigration policies coupled with a system geared to provide free (albeit sporadically qualified) care to everyone, legal or not.

And tell me, dear readers, how this could be expected to play out differently under ObamaCare© and our current immigration policies?

What to make of this...

Consulting firm Accenture recently published the results of their survey of physicians, which reveals a disturbing (but unsurprising) trend:

"(T)he rate of independent physicians being employed by health systems will grow by an annual five percent over three years. By 2013, less than one-third of physicians are expected to remain truly independent."

I characterized this as "unsurprising" because we've been predicting this for quite some time. For example:

"As we reported ... 40% of doctors said they would "retire, seek a nonclinical job in health care, or seek a job or business unrelated to health care ... Dr Bradley Wertheim ... finds that new physician training standards will exacerbate the problem ... We have too many patients and too few doctors."

The interesting twist in the Accenture study is that so many docs seem to be casting their lots with hospital-based practices, aka ACO's. When hospital bean-counters, not physicians themselves, are calling the health care shots (so to speak), what do you think will happen to quality of care?

Breaking: Aetna Quits the Bluegrass State

From this morning's email:

"Effective July 1, 2011, Aetna will stop selling new Individual Insurance and Small Group policies in Kentucky. After reviewing their portfolio of Individual and Small Group plans in Kentucky, Aetna determined they can no longer meet the needs of their customers while remaining competitive in the Individual and Small Group market."

If you're a current insured, you can still add spouses and dependents, but not change plans. That last is critical, because that's often the only way to maintain affordability.

But remember, "if you like the insurance you have, you can keep the insurance you have."

Ah, expiration dates!

UHC/Medco Update: Resolution

On Monday afternoon, I spoke with Lynne H, UHC's Director of Media Relations. As noted last week, I had already discussed the issue with the Communications VP at United Health Group, and the UHC Account Coordinator at Medco. There have been two basic concerns here:

First, the original mis-pricing which cost my co-worker over $100, and

Second, ascertaining the extent of the problem (how many other insureds have been affected?).

Yesterday (the 15th), my co-worker spoke again with the Medco Account Coordinator, who assured her that there is no dispute on their part that this occurred (thanks to the screenshots we kept), but that he had never seen this particular problem before (more on that in a moment).

He went on to confirm that, now that they're aware of the problem, they're looking to correct it going forward, and that they would issue a credit to her charge card for this transaction (which we have confirmed has taken place). He also confirmed something we already knew: that the system does, in fact, know the status of her account (deductible credit, claims paid, plan design, etc), and that it takes these factors into account.

The underlying problem seems to be that the med that showed up with the $33 pricing was, in fact, not available through the Medco mail-order program, and that an alternative (more expensive, natch!) was substituted. According to "the Medco guy," this was an honest mistake, not an attempt to defraud my co-worker.

I'll accept that - we have numerous enough examples of Stupid Carrier Tricks to support such a contention.

Finally, he and his staff will be reviewing their customer service processes; the fact that this took almost 2 weeks, numerous emails and phone calls, and two blog posts to be resolved does not reflect well on their current practices. It didn't help that my co-worker was told to wait 3 days and then call them; this is also not acceptable, and they're working on that, as well.

Here's the thing: I do appreciate the quick response once the powers-that-be at UHC and Medco read the original post. It's humbling for me to know that IB is able to help folks amplify their voices, and that what we say has some authority. On the other hand, just because the Medco guy has never seen this before doesn't mean that it hasn't happened (or doesn't continue to happen). How many folks have run into this and just thrown up their hands in resignation that they've been "screwed by the insurance company again?"

Hopefully, this is a small number of insureds, and the problem will now be a thing of the past.

Thanks to UHC's Tyler M and Lynne H, and Medco's Steven W for their help in resolving this.

Hearts and Noses

Surprisingly, DC isn't the only place you'll find clowns (amateur or otherwise):



[Hat Tip: David Williams]

(Un)Healthy Exchanges

Mike Cannon, Director of Health Policy Studies at the Cato Institute (and FoIB), has a thought-provoking proposal:

"A key battleground is whether states will implement the law by creating government bureaucracies that Obamacare euphemistically calls health insurance "exchanges" ... Creating any sort of exchange is unnecessary, wasteful and counterproductive."

But it's in the law we had to "pass to learn what's in it."

Mike proposes a simple, elegant alternative:

"States are under no obligation to create these bureaucracies, however, and many have wisely refused."

Worst-case scenario? HHS "makes them" do so.

Keep in mind, though, that the Exchanges are still several years away, and "(i)f the Supreme Court overturns Obamacare, any money [states spent] creating an exchange would be wasted."

I would add several additional factors:

First, there's a distinct possibility that, come 2014 (when the Exchanges are scheduled to come online) we'll be calling her former HHS Secretary Shecantbeserious.

Second, we've seen how well the ObamaPools© have worked; any takers on whether or not the Exchanges will fare any better?

Cavalcade of Risk #133 now up

IronMan hosts this week's eclectic collection of risk-related posts. As usual, it's thoughtfully laid out and easy to click through.

Ohio DOI Info Bleg

Under new rules, Ohio agents must now renew their licenses every two years (this is separate from CE requirements, and a change from the previous "perpetual license" model).

The renewal process is itself unnecessarily (and counter-productively) difficult, tedious and ill-defined. I'd like the Department to investigate and correct this, but with the new administration, I no longer have the connections necessary to "get this done."

I know that folks from the DOI read IB; would one of you please be kind enough to contact me to discuss this issue?

I also know that some of our readers may have appropriate contacts in the Department; would you please let me know if you can help?

Thanks!!

Miracle Weed

A while back, Bob pondered whether or not medical marijuana would be a covered expense under ObamaCare©. Well, we're still waiting on that one, but at least one unlikely player has stepped forward to offer assistance to, um, "providers:"

"Scotts Miracle-Gro Co. [see note] has long sold weed killer. Now, it's hoping to help people grow killer weed ... Scotts Chief Executive Jim Hagedorn said he is exploring targeting medical marijuana as well as other niches to help boost sales at his lawn and garden company."

[ed: Formerly Stern's Miracle Gro. Just sayin'.]

Turns out, 16 of the 58 states "have legalized medical marijuana ... The market will reach $1.7 billion in sales this year."

That's a lot of extra pizzas and Doritos.

One wonders if Scott's is bucking for an ObamaWaiver©.

Grand Rounds: Health Business Blog-style

FoIB David Williams hosts this week's extensive round-up of great medblog posts. As usual, he adds his own unique perspective (and dry wit) to each post. Do stop by.

Conflicting Messages

What might these two seemingly unrelated items have in common:

TNR's Maisie Allison tipped us to "How American medicine is destroying itself." It begins with a 50 year old quote stating that "complete and lasting freedom from disease is but a dream remembered from imaginings of a Garden of Eden."

The question at the heart of the article is quite simple, really: Can we really conquer disease? At what price?

We've had a War on Poverty, a War on Drugs, a War on Illness. Untold billions (trillions?) of dollars later, victory has still not been achieved (and yes, defining "victory" is another challenge altogether). Are we spending our resources wisely?

Let's continue, shall we?

FoIB Bob D alerted us to this Policy Digest essay which asks "Will Comparative Effectiveness Research Kill More People than It Helps?"

The premise of this piece is that, among the myriad of potential treatment options available for a given diagnosis, it's often challenging to determine which one is the most effective. The process by which this is determined is called Comparative Effectiveness Research (CER), and it's one of the New, Hot Things© on the health care radar.

It's also the subject of a major push by the Feds to generate more cost effective health care results.

But will it?

According to a study by folks at the University of North Carolina (Hi, Jeff!) and the Center for Medicine in the Public Interest, the answer is a resounding "Nope:"

"Instead, it will force cuts in pharmaceutical and medical device research and development, resulting in 32 million lost years of life and economic losses totaling $1.7 trillion."

And why is this?

Well, here's a clue:

"Health care costs are the focus of most policy considerations because this demand is heavily subsidized by taxpayers."

Ya think?

I believe that there are some dots that can be connected here. How about you?

HHS, Privacy, and Your PHI

HHS Secretary Shecantbeserious may be relaxing some privacy rules:

"The Department of Health and Human Services says patients should have the right to see who has accessed their electronic health records."

The advent of HIPAA dramatically changed how I do business. For one thing, I can no longer routinely call up clients' docs to ask for help with medical records. It's more difficult (and time consuming) than ever to get answers from a home office. Keeping up with all the privacy rules threatens to become a second vocation.

But I don't feel any more secure, and I'm not convinced that my clients do, either. And I'm not sure that the new rules (as proposed) do much to allay those concerns:

"(P)eople would be able to request an "access report," which would name the particular persons who viewed their electronic health records ... it would not explain the purpose of that access."

If anything, I think this would engender even more distrust about the use of our private health information.

Shame Insurance?

What would you pay for the opportunity to hit the "unsend" button on that blistering email you sent in a fit of pique? How about accidentally forwarding that naughty pic? To your boss?

"Internet Shame Insurance is a very simple Google Chrome extension that adds privacy reminders ... to help you avoid the most common online communication faux pas. The extension sits in the background and springs into action only when you're about to post a status update or reply all."

[Insert NY CongressCritter reference here]

[Hat Tip: Ace of Spades]

The (Deadly) MVNHS©: 1,000 Words of Shame

This is what "health care" looks like when the government runs the system:

"Nurses casually stepped over a patient as he lay dying on a hospital floor ... Peter Thompson, 41, was left in a corridor for ten hours before someone noticed he had passed away."

Remember this the next time someone tells you that nationalized health care is the way to go.

It sure is.

30% and Preference Cascades

About a year ago, we wrote about Preference Cascades:

"in which people who have been obliged to conceal their true beliefs by social pressure or sheer force suddenly discover that a lot of other people feel the same way."

This concept holds true not just for individuals, though, but also for businesses (and business owners).

A few days ago, Bob wrote about a recent survey which predicted that "up to 30% of employers may cease to offer health insurance to their employees" come 2014. The impetus for this exodus will be the Exchanges, wherein employers will be able to offload health insurance to that government program.

Today at lunch, my friend Tom remarked that he thinks that number is just the tip of the proverbial iceberg. That is, only about a third of employers today, some 3 years out, claim they'll be dumping their group plans. But Tom thinks that once this initial group sheds their health insurance onus, many, many more will follow suit.

In this case, the Preference Cascade would go like this: large corporations, which tend to strategize in 5 (or more) year increments, see the writing on the wall. They know that they can divest themselves of an expense which is almost impossible to control, with numbers that are nigh unto impossible to predict, and which involve many additional dollars and man-hours in admin costs. For them, 2014 is almost literally around the corner, and they can easily plan to put that expense back onto their employees (and the government).

So a third are already planning for this, and Tom thinks at least one third more will jump onto the bandwagon. And why not? After all, if you're an "early adopter" then it's possible that some of your employees will look for jobs at one of your competitors that still offers group coverage. But there will be (at least) two major hurdles: first, if we're correct (and I think we are), then the Preference Cascade will have already begun its work, and there will be far fewer employers offering coverage. Couple that with continued high unemployment, and the question then becomes: where are these folks going to go?

It actually gets worse, though: Medium sized businesses, which Tom theorizes plan in 36-month cycles, aren't really thinking about this yet, but beginning next year, it will definitely be on their radar. They, too, will see an opportunity to get out of the group insurance rat-race. And again, the same factors affecting employees of larger companies will come into play here, as well.

Now, I've long been on record as an advocate of privately-owned health insurance. That is, I don't think health insurance should be tied in any way to one's employment (after all, your boss doesn't buy your groceries for you, or pay your mortgage company). The problem is that the mechanism predicated in ObamaCare© is even worse than the current system.

It's the worst of both "be careful what you wish for" and "we have to pass it to read what's in it."

Cavalcade of Risk #133: Call for submissions

Political Calculations hosts next week's CavRisk. Entries are due by Monday (the 13th).

NB: We're now using this submission tool: The BC WorkAround

Once there, you'll be asked to provide:

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

At the bottom of the form, you'll see a drop-down menu; simply select "Cavalcade of Risk" then press "Submit" and you're good to go.

And PLEASE remember: ONLY posts that relate to risk (not personal finance tips and the like).

Something New Under the Sun?

It's not often that the insurance industry coughs up something that's truly "new," but I must admit, this certainly seems to qualify:

"Hospital Recovery Insurance ... pays cash benefits upon discharge from the hospital, helps ... in the recovery stage following a hospital stay."

Unlike typical insurance plans, which pay (or help to pay) for the hospital stay itself, this one pays after you've been discharged and (presumably) on your way to wellness. I "click[ed] here to download the 4-page pdf," and (after completing a routine form), found myself staring at a "Plan-At-A-Glance" flyer.

It's kind of interesting: you can select a benefit of $100 to $999, payable for each day that one spent in the hospital (up to 15 days-worth). Seems pretty simple and straightforward, and the list of exclusions actually make sense (no benefits payable for, for example, "engaging in hazardous activities," "elective surgery that is not medically necessary," and "normal pregnancy except for complications of pregnancy," among others).

They even included rates, which are age- (but not sex-) based. For example, a 35 year old can buy a daily benefit of (for example) $300, which becomes a "bank" of $4500, for about $17 per month. On the other hand, I have to believe that their primary market is going to be folks a little further along life's path: at age 75 (the oldest for which premiums are provided), the rate soars to $78 a month for that plan (which makes sense).

They didn't provide a sample policy or application in the announcemail (understandable), but one presumes that it's fairly simple.

I'm not necessarily convinced that this is really "must have" coverage, but it's nice to see folks looking for new marketing ideas, and thinking outside the box.

UHC/Medco Tricks: Update

Just a quick note to bring readers up to date on the UHC/Medco issue:

■ I've been in voice and email contact with a Vice-President of United Health Group (UHC). So far, this has consisted of trading voicemails, and a quick document dump (me to him).

■ Received a call from the Medco rep in charge of the UHC account (more voicemail).

I've explained to both gentlemen that I appreciate their offer(s) to help resolve my co-worker's specific problem, but that we need to also address the big picture going forward.

■ Connected with my contact at HHS, who has provided me contact information for his counterpart at the Inspector General's office. I'm holding off on making contact until UHC and Medco have a chance to make a good faith effort at resolution.

■ Finally, I've reached out to a friend with contacts at the Ohio Attorney General's office. My previous experience with that agency is that it's best to have a specific person with whom to connect.

As an aside, Bob noticed something interesting in the email I received from my HHS guy:

"Is your co-worker a Medicare beneficiary? As far as I know, HHS only investigates fraud against HHS programs."

Which is a fair cop, but as Bob asks: "Why would HHS only get involved in Medicare claims when [HHS Secretary Shecantbeserious] thinks she has domain over all things concerning health insurance?"

UPDATE: Resolved.

Let Them Eat Twinkies

Know how to fight evil (mandates)?

Simple: Tank your take-home.

Proving that there are no coincidences, PresBo's "acting" Solicitor General (aka Neal Kumar Katyal), offers words of encouragement and a surprising (if cynical) strategery for avoiding the individual mandate:

"[T]he minimum coverage provision only kicks in after people have earned a minimum amount of income ... So it’s a penalty on earning a certain amount ... someone doesn’t need to earn that much income."

To paraphrase Larry the Cable Guy, I don't care who you are, that's genius! And in this economy, it's both realistic and relatively easy.

Unfortunately, Judge Jeffrey Sutton (of the 6th Circuit), had the temerity to point out "that wasn’t in a single speech given in Congress about this...the idea that the solution if you don’t like it is make a little less money.”

Geez, Jeff, haven't you been paying attention? We had to pass the bill to see what's in it!

Down to the last penny?

Health Care Reform legislation mandated temporary federal assistance to medical benefit plan sponsors toward the cost of their early retiree (i.e., pre-Medicare) benefits. Congress appropriated $5 billion of taxpayer money to fund this mandate, called the early retiree reinsurance program (ERRP). In the legislation ERRP was set to end no later than January 1, 2014 when the main provisions of health care reform kick in - - and thus is temporary.

It now appears ERRP is even more temporary than Congress imagined.

The Department of Health and Human Services released this report on ERRP May 13, 2011. [look under "Recent Changes"] The report shows that ERRP payments for requests submitted through March 31 and paid thru May 3 totaled almost $2.5 billion, or nearly half the total appropriation.

HHS notes in their report that, “due to the significant response among the employer community, the program ceased accepting applications on May 6, 2011.” Significant reponse is an understatement. But, remember, it was supposed to be temporary.

As it turns out - - very temporary.

Considering applications received after March 31 that are not yet reflected in the total ERRP payments, it’s clear that the money is running out much sooner than expected. It’s even possible plan sponsors whose applications were approved after March 31 will not be reimbursed for the full amount of their 2011 eligible expenses. And as for 2012, 2013? - - fugheddabouditt !

The HHS report lists the benefit plan sponsors that have received ERRP payments, and the amounts paid. There are 1,748 plan sponsors on the list. Of these, 16 (fewer than 1%) received a total of just over $1 billion (42% of all the payments). These 16 plan sponsors include 5 corporate plans (e.g., AT & T, Verizon) which were paid about $301 million; 2 union benefit trusts paid about $246 million; and 9 State employee retirement systems (e.g., Ohio, Kentucky) paid $485 million. The largest single recipient is the United Auto Workers Retiree Medical Benefits Trust which, according to the HHS report, was paid $220,717,012.70.

Your tax dollars at work - - right down to the last penny.

On the other hand, ERRP is a metaphor for the health reform legislation of which it is a part: big on promise, inadequate on delivery, and grossly unprepared for the actual demand.

Fraudulent Carrier Tricks: UHC and Medco

Fraud: A false representation of a matter of fact—whether by words or by conduct, by false or misleading allegations, or by concealment of what should have been disclosed—that deceives and is intended to deceive another so that the individual will act upon it to her or his legal injury. [emphasis added]

People wonder why health insurance carriers are held in such low esteem.

It's pretty simple: when you pull idiotic stunts like this, you will get bit in the behind.

We're all for consumer-driven healthcare, which means that we take seriously the idea that we should exercise good judgment when purchasing said care. My co-worker takes a certain medication which has gotten rather pricey, and United HealthCare recommended that she switch to the lower cost generic equivalent. Like many carriers, UHC outsources its prescription medication function to a Pharmacy Benefits Manager (PBM); in this case, that's Medco.

My co-worker saw the wisdom in this course of action, and went online to get pricing for the new medication. The Medco site specifically told her that it would be $33.12 for a 90 day supply (this in contrast to the $132 brand-name version). Since this represented a great savings (and since we're covered under a high deductible HSA plan), she immediately pulled the trigger for the $33 generic.

Imagine her surprise when, the next day, her credit card was charged for $153 - a 450% increase.

Is this fraud?

Well, look at the definition above, and draw your own conclusion.

My co-worker then spent quite a bit if time on the phone with the Customer NOservice folks, who assured her that they'd "look into it," and that she should call them back in 72 hours.

I had a better idea:

I contacted our service rep, explained the problem, and provided documentation. I also informed her that I needed resolution by 9:00 AM the following day. She did call me back, and told me that she had been told that the pricing my co-worker had been given (based on our plan and group number) was available only after she had met her deductible. Unfortunately for UHC/Medco, not only was none of this disclosed on the site, but clicking on the link "How is my cost determined" actually confirmed the $33.12 price tag, putting the lie to UHC/Medco's little dodge.

I had originally given UHC/Medco until 9:00 AM yesterday (June 2nd) to resolve this problem. Because I'm basically a fair guy, I decided to extend that by 24 hours.

Which has now come and gone.

And so:

First, this post alerting our readers that UHC and Medco seem to have no compunctions about bait-and-switch when dealing with med's, nor are they forthcoming with details as to how rx claims are adjudicated. This makes it impossible for insureds to budget, or to make informed decisions.

Next, I'll be calling the Ohio Attorney General, to report this apparent case of fraud.

Finally, I'll be calling my CongressCritter, and suggesting that this may represent a much bigger number of victims than just my co-worker.

Now you may ask: "Henry, why so serious?"

And here's my answer: I spend a lot of time and energy explaining to people why a gummint-run health care system is so much worse than one run by private industry. But this is no better than the stunts pulled by the MVNHS©. So tell me again why our system's better?

Update: RESOLVED!

Stoli (with a) Twist

As we continue to follow the strange case of the Life Partners debacle, Bob tipped me to this related item:

"Gilbert Eastin’s finances have fallen steeply from 2008, when the West Bloomfield man’s net worth was estimated at more than $2.5 billion ... Eastin, 82, is being sued for more than $2 million in U.S. District Court in Detroit, accused of inflating his net worth to obtain millions of dollars in life insurance."

His (alleged) mark? John Hancock Life, which was somehow persuaded to approve $50 million in coverage.

$50 Million??

One can only imagine the medical exam for that much insurance.

As we saw with the LP fiasco, this appears to be a growing, if not already widespread, problem:

"Insurance industry experts say the allegations appear to match a pattern of fraud emerging nationwide. Senior citizens are recruited to inflate their net worth ... and then transfer the policies to investors in exchange for money."

On the one hand, I still maintain that a legitimately purchased life insurance policy is the same as property (that is, the owner is free to dispose of it as he or she sees fit). The problem, of course, is that these policies are, in fact, fraudulently purchased, and enjoy no such latitude.

The alleged "victim" here earns The World's Smallest Violin:

"Eastin now admits he's no billionaire ... The retired Chrysler plant supervisor says he's a victim of shadowy businessmen from New York."

Of course, of course.

"Crooks will do a lot of things to develop a patsy," says the perp, er, "victim."

But he was the one who completed the application, took the exam, and presented whatever false documentation was necessary to "perpetrate the fraud" in the first place.

All he had to say was "no."

Here's a first: Fire Sale on Health Insurance

Last we checked, the goofy ObamaPool© program had few takers, and the new numbers aren't encouraging; only "about 18,000 people nationwide have enrolled in the plan over the past year."

Keep in mind, the Congressional Budget Office had estimated that something like 4 million Americans would qualify for the program. That's a response rate of less than one-half of one percent.

Ouch.

So the program's a bust, even though it offers immediate coverage for pre-existing conditions (even maternity!) at extremely competitive rates. A normal, profit-driven insurer would take stock, examine the marketplace, and immediately close it down.

But this is ObamaCare©, so the gummint's response would be?

Of course:

"The federal government said Tuesday that it will slash premiums by 40 percent to entice more Arizonans to join a high-risk insurance plan for people with pre-existing medical conditions." [emphasis added]

Rest assured, the Grand Canyon State won't be the only one to reap the benefits; with the $5 billion initial seed money already on the table, the other 56 states won't be far behind in demanding their fair share of the premium reduction bonanza.

The good news, such as it is, is the the Federales may be onto something with this wrinkle:

"In addition to reducing premiums and making it easier for people to enroll, the federal government will expand its outreach to the business community ... Sayen said Medicare officials this fall plan to reach out to insurance brokers ... to reach more potential customers."

Gee, where have we heard this idea before?

The catch?

"He said it is too early to tell what type of commission may be available to insurance brokers."

More rocket-surgery from Washington.