Health Wonk Review Comin' Up

We'll be hosting next week's Health Wonk Review, and (as usual) the emphasis will be on "health policy, funding, insurance, managed care, infrastructure, IT, the uninsured, economics and trends."

You can submit your wonky post here, and be sure to include:

■ Your name
■ Your blog's name
■ Your post's link
■ A brief summary of the post

Submissions are due by next Wednesday (the 5th),  but early birds get better seats at the table (hmmm, bit of a mixed metaphor, that). And speaking of seats at the table, make sure to bring some apple sauce and sour cream (and maybe some peanut M&M's).

And matches. Definitely matches. Or a lighter.

Babies and Gramps: On the road to Death

Well at least they're consistent: The Much Vaunted National Health System© seems hell-bent on applying the same (dubious) health care standards on helpless infants as vulnerable seniors:

"Sick children are being discharged from [MVNHS©] hospitals to die at home or in hospices on controversial ‘death pathways'"

What they're talking about there is the Liverpool Pathway, about which we've written pretty extensively in recent weeks (for example: here and here). Typically, the LP had been used to dispose of decrease treatment for the elderly, since the MVNHS© had already been doing a bang-up job killing off post-birth-aborting children.

One can see their point, of course: much more efficient to combine the two programmes, and the Pathway has already proven quite helpful in reducing health care expenditures (well, health care, anyway) for seniors. We'd best be paying attention to this ourselves, since the ObamaTax is our version of that vaunted system.

Sweet dreams.

PHI and Speed Bumps

Yesterday, Bob posted on the increasingly intrusive role data and its management play in modern health care. But it goes beyond physicians typing in notes on their iPads:

"The small box inside Amanda Hubbard's chest beams all kinds of data about her faulty heart to the company that makes her defibrillator implant."

That data gets shot to her cardiologist, but is essentially inaccessible to Ms Hubbard.

Wait a minute, Henry, haven't we seen this show before?

Indeed we have:

"Hugo Campos has [an ICD] buried in his chest to help keep him alive. But he has no idea what it says about his faulty heart."

All the pertinent data is collected and then sent back to the manufacturer, which then shares some of it with Hugo's doc."

So why the re-run?

Well:

"Medtronic [the device's maufacturer] says federal rules prohibit giving Ms. Hubbard's data to anyone but her doctor and hospital."

But it apparently doesn't prohibit Medtronic from seeking to make a buck off that data. The so-called "money quote," though, is this:

"[B]usiness agreements with doctors and hospitals restrict [Medtronic] to relaying information only to them."

This is reminiscent of the discounted rates insureds pay for in-network covered services, but which are excluded for those that fall outside the plan. That is, these agreements are quite lucrative for the providers (be they hospitals, device manufacturers or doctors), but not so much for the actual patient.

One argument will be that laypeople have no real use for the data because it's incomprehensible to them anyway; we already know from Mr Campos' experience that this isn't necessarily true.

A second argument would be that the law prohibits manufacturers from disclosing that data. Actually, my layperson's read is that since it falls outside the rubric of HIPAA (and/or the ObamaTax), manufacturer's aren't required to disclose it. Not quite the same thing.

So we'll ask again: Who (really) owns the data?

On Death Files, Competence and Confidence

As we noted last Spring, the Social Security Administration's Death Master File (DMF) "is itself rife with potential errors and misinformation." We reported this as part of our report on how life insurers are having an increasingly difficult time tracking down insureds and beneficiaries.

But there's another problem with that DMF, as well.

And this one's not so much about incorrect information as it is missing information.

One of my (very long term) clients lost her daughter 28 years ago, victim of a murder-suicide. Both her daughter and son-in-law have been gone almost 3 decades, but that didn't stop the government from reaching out to the long-dead perpetrator to remind him that he's now eligible for both Social Security and Medicare benefits.

But Henry, you may be asking, why are you even posting this?

Because it's just one more example (as if any were really needed) of how incompetent the Feds are at even the simplest of tasks, and these are the folks now in charge of our health care. In this case, it's simply a minor waste of postage, but what happens when it's your upcoming surgery?

Sleep well.

MVNHS©: Cruel and Unusual

When bureauweenies run your "health care" system, this really shouldn't come as a surprise:

"Patients experience “coldness, resentment, indifference" and "even contempt” in some hospitals, the Health Secretary has claimed"

And why not? They're not paying the bills.

And so you get, well, government-run health care:

"[P]atients left to lie in their own excrement in Stafford Hospital, with members of the public taking soiled sheets home to wash ... The man with dementia who was supposed to be monitored every 15 minutes who managed to leave Pontypool Hospital and drown ... residents kicked punched, humiliated, dragged by their hair and forced through cold showers"

And the list goes on...

At the risk of stealing his thunder, Mike's been working on a post detailing a rather interesting and provocative theory of how and why this is the natural result of state-run health care systems (like, for example, the ObamaTax). Suffice it to say, there really is a perfectly good reason why this sort of behavior is becoming "the new normal."

And the fact that the Brits' version of Mme Shecantbeserious is just now lashing out only serves to underscore how putting government agencies between ourselves and health care providers never ends well.

LTCi Gets More Expensive

Kinda wondered when the carriers would get around to this:

"Until now, insurers have charged the same premiums regardless of gender for [Long Term Care insurance] policies ... beginning early next year, Genworth Financial, the country's largest long-term-care insurer, plans to start charging women applying for coverage as much as 40% more than men."

This actually makes sense: women tend to live longer than men, so have an increased chance of needing some kind of assistance. As a result, two thirds of LTCi claims dollars go to the fairer sex. Add in carriers' measly investment income in these low-interest rate times, and there's a recipe for some major problems.

And don't be surprised to see underwriting tighten up, as well, as carriers are starting to better understand long-term trends.

And there's this: just because Genworth's going first doesn't mean that the other carriers won't follow their lead, so look for plan prices to begin jumping pretty soon.

Ouch.

Cracks in the MVNHS©?

Hmm, this sounds familiar:

"The [MVNHS©] can’t go on like this. Patients today – baby boomers, especially – bother the doctor with minor complaints ... and have unrealistic expectations of what the health service can provide. The system is at breaking point ... We are going to have to start paying for some medical services at the point of delivery."

Heh.

So the Much Vaunted National Health System© has been no more successful at reining in costs with "free" health care than our own "dysfunctional" system?

Who'da thunk it?

Oh, yeah.

This diagnosis, by the way, comes from physician (and Tory MP) Phillip Lee, who adds that the system "probably can limp on for the rest of this decade ... but the reality is the pressures coming from the baby boomer generation and their expectations of health care, their perceptions of pain and suffering is profoundly different [than] their stoic parents who survived the war.”

In other words: suck it up, buttercup.

Or it's hit the Pathway for you.

Cavalcade of Risk #171: Up and running

Emily Holbrook hosts this week's episode featuring the best of risk-related posts from around the 'sphere. It's short, sweet and packs a punch (and a mighty hammer, too).

Yeah, about that promise...

You know the one:

"If you like your health insurance you can keep your health insurance."

That sound you hear? It's that promise going under the proverbial bus.

From Medical Mutual of Ohio (email):

"As part of the renewal process for our individual health plans ... we will introduce several key changes starting with January 2013 renewals.

... the Internal Revenue Service (IRS) changed the 2013 key amounts for health savings accounts (HSAs) and HSA-qualified high-deductible health plans.

Due to the revised guidelines, we can no longer offer Wellness HSA 1200 plans to our SuperMed One and Ohio Farm Bureau members. As a result, we will transfer all members enrolled in these plans at their renewal.

SuperMed One members will move to the Wellness HSA 1500 and Ohio Farm Bureau members will move to the Wellness HSA 1750. These members will see an increase in their deductible"

Ch-ch-changes, indeed.

Off the Beaten Path(way)

As we noted late last month, MVNHS© "trusts" (hospitals) that participate in the British Death Panel Liverpool Care Pathway have been handsomely rewarded for their efforts. This makes sense: by scrimping on care they save the system cold hard cash, thereby earning their (not so) little finder's fees.

But all that may be coming to an end:

"Ministers ... ordered an independent inquiry into why hospitals have been paid to hit targets for numbers of patients dying on the Liverpool Care Pathway."

I'm sure this will be welcome news for those currently on the path; for those whose lives bought Angus steak dinners for the bureauweenies, not so much.

I did find this little tidbit darkly humorous:

"Mr Lamb said the inquiry would ‘consider the value of locally set incentives, and whether they are leading to bad decisions or practice’"

Well, that really depends on whether one believes killing off patients is a bug or a feature, doesn't it?

ObamaTax Job Killer

As we've previously noted (most recently here), the ObamaTax is quite the efficient job killer.

Orlando Health (FL) is a large hospital system employing some 16,000 folks.

Strike that.

Orlando Health (FL) is a large hospital system which used to employ 16,000 folks, but which has just downsized 400 of them in anticipation of changes being wrought by the ObamaTax.

Meanwhile, the Community College of Allegheny County (PA) is drastically reducing the hours of 400 employees of its own. These adjunct professors will be re-classified as part-time to avoid the ObamaTax Employer Mandate. But of course they'll be able to find quality, affordable coverage of their own through the Exchange.

Eventually.

Right?

And speaking of killing the goose that lays the golden eggs jobs, here's an ObamaTax "benefit" that's been flying under the radar:

"Section 4205, the menu labeling provision .... meant to “aid consumers in selecting more healthful diets” ... the regulation will likely have job-killing effects and result in little, if any, significant reductions in obesity rates and/or improved health."

The problem is that, as benign as the idea might appear, it is just one more unfunded (by gummint) mandate that will drive up the cost of doing (food) business, with no discernible positive effects, but with the very real consequence that employers will have to pay for implementation at the cost of their employees' jobs.

Ooopsies.

A Belated Thank You

I inadvertently let Thanksgiving come and go without acknowledging the invaluable contributions made by my fantastic co-bloggers.

I'd like to remedy that:

Thank you Bob, Mike, Nate, Kelley and Bill for all of your great posts, insightful advice and unstinting help here at IB.

There's no better team in the blogosphere.

"Free" keeps getting more expensive

Dr Peter Weiss, Director and Founder of The Rodeo Drive Women's Health Center, is finally catching on to at least one ObamaTax gotcha, the "free" annual exam. As Bob noted last summer, "if you don't follow the rules, your free annual exam could cost you $500 - $1000 or more."

Fast forward a few months, and Dr Weiss reports some changes reflecting this reality at his practice:

"I have now posted a notice in my office and each exam room stating exactly what Obamacare will cover for those yearly visits. Remember Obama promised this as a free exam — no co-pay, no deductible, no charge. That’s fine and dandy if you are healthy and have no complaints."

Aye, thar's the rub: as long as you're fit-as-a-fiddle in the first place (and/or if you had previously treated and now stable conditions) then you're likely to get out of the examining room with wallet intact. But woe to the patient who also has new issues:

"[Y]ou will not be covered if you want to discuss any new ailment or unstable condition. I cannot bait and switch to another code — that’s illegal."

In other words, if you're in for your routine exam, make sure not to ask the doctor about your stiff neck or new-found acid reflux. You'll need another appointment for that, one in which your deductible or co-pay will apply.

But hey, it's free, right?

BONUS: Dr Weiss also takes his scalpel to the canard of "the rich doctor" (gee, where have we heard that term before?):

"[D]octors are not rich and, like most of you, actually work terribly hard for a living. Second, Obamacare is the law — and as I said earlier, we are audited all the time now."

And this is only going to get worse: as we've noted, there's already a shortage of providers, and Dr Weiss thinks we're seeing just the beginning of of that trend:

"By 2014, less than 25% of physicians will be in private medicine. Obama was right in stating you can keep your doctor if you want to — the problem is he or she will rarely be available."

Three cheers for the ObamaTax, no?

ObamaTax Rule Dump: More Questions Than Answers

As Bob noted the other day, we're still awaiting final rules on full implementation of the ObamaTax. But that's about to change.

Today, HHS Secretary Shecantbeserious is set to "pump three major [ObamaTax] regulation proposals into the Federal Register." These include new rate review rules (say that 3 times fast!), the new group wellness program rules, and new provider accreditation rules.

Of course, the phrase "clear as mud" comes to mind, but I'm sure that there'll be no problem implementing all of these rules, and that providers and insurers will be delighted to comply with them. After all, it's only taken almost 4 years to develop them.

Meanwhile, some parts of the ObamaTax have already been rolled out, and their effects are starting to take their own toll. For example, the 2.3% medical device tax:

"This damaging tax will force job cuts and investments in tomorrow's treatments and cures ... Continued medical innovation is key to driving public health gains by reducing costs associated with chronic diseases like diabetes and obesity ... Simply put healthier lives mean healthy economies."

That last bit is a sketchy (I've never seen that particular claim before, nor evidence of its veracity) but the rest is spot on. Throwing up additional barriers (ie taxes) like this discourages new tech, while making the delivery of health care ever more expensive.

But then again again, that's apparently where the IPAB Death Panels come in.

How pointless will CER be...

...and how long till we realize it was nothing but a slush fund for Obama like his green jobs money?


"The routine use of mammograms has led to more than 1 million women being unnecessarily treated for breast cancer over the past three decades, according to the latest scientific report to cast skepticism on the effectiveness of the test."

"Even before those findings, in November 2009, a key federal panel revised its guidelines on mammograms to say that women should begin regular screenings at age 50 rather than age 40, and then get the exam every other year rather than annually."

"In 2010, lawmakers tweaked a mandate in the health-care law requiring insurers to cover preventive services recommended by the task force free of charge. The law specifies that when it comes to mammograms, insurers must follow the task force’s old guidelines"

Why spend the money if we are just going to ignore the results? 

Do premiums matter under PPACA?

As a small claims payor I am always keeping my eyes open for experienced claim processors by searching resume boards. The last few months I have seen a large number of adjusters that used to work for Anthem. Normally you don't see adjusters leaving the large carriers as they pay great and have better benefits and retirement opportunities. Seeing a couple let alone a dozen is rare. In speaking with a few of them I was told they outsourced their claims processing to the Philippines and India. This got me wondering what this foretells of the future.

If you're a carrier and you're locked into 15% of revenue, do you spend that money on claims adjusters to control your claims cost, and thus reduce your revenue...

...or do you auto-adjudicate as many claims as you can, 70-80%+, then outsource the remaining claims to some low cost foreign country?  They won't do as good of a job (meaning they will pay more in claims then they should) but that actually increases their revenue, a perverse reward for a job poorly done.

This has been the Medicare model for decades and resulted in the most inefficient and fraud ridden program in the country. But if no one is directly paying the bill who cares? Medicare beneficiaries pay a minute fraction of the actual cost of their benefits so they don't care if 10%+ is lost to fraud. If the majority of the exchange members are going to be subsidized they won't mind either. The only people that would care are workers actually paying federal taxes, a minority when it comes to voting.

From the anecdotal evidence I have seen so far, it appears private insurance is adopting the worst qualities of Medicare already, before the exchanges even start.

For claim processors, 60% of expenses going to salaries is normal; if you drastically reduce that the business goes from low margin commodity to very profitable very quickly.

This Sceptered Isle - Part CCXXIV

"A new system of “virtual clinics” is being planned in which GPs connect with patients via iPads and Skype, an idea that NHS bosses are importing from India.  The reforms would save £2.9billion “almost immediately” and improve the lives of most patients, for example by avoiding the need to find child care during appointments, Health Minister Dr Dan Poulter said last week."

Notice the best NHS can say about this "reform" is that this will improve Brits' lives by "avoiding the need to find child care during appointments"?  Really? That's it??

But don't forget - NHS will save £2.9billion ($4.65 billion)  “almost immediately”.  We must assume those savings will also improve the lives of most patients almost immediately even though the article does not say how. 

Anyhow my guess is, if you're not British, and not a patient, you won't much care.  This kind of thing could never happen here. Government doesn't have that much control over the U.S. medical care system.  Right?

Cavalcade of Risk #171: Call for submissions

Emily Holbrook next week's Cavalcade of Risk - Entries are due by Monday (the 26th).

To submit your risk-related post, just click here to email it.

You'll need to provide:

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

PLEASE remember: ONLY posts that relate to risk (not personal finance tips and the like). And please only submit if you are willing to link back to the carnival if your submission is accepted.

Thanks!

Remembering the First Thanksgiving

One of the earliest and arguably most historically significant North American colonies was Plymouth Plantation, founded in 1620 in what is now known as Plymouth, Massachusetts.

The original Plymouth Plantation had written into its charter a system of communal property and labor.

illiam Bradford recorded in his Of Plymouth Plantation, that a people who had formerly been known for their virtue and hard work became lazy and unproductive. Resources were squandered, vegetables were allowed to rot on the ground and mass starvation was the result. And where there is starvation, there is plague.

Plague. Lest we forget: there was, and remains to this Thanksgiving Day, an unbreakable connection between economic productivity and public health. The Plymouth Colonists' very survival was threatened (and they had neither NHS nor ObamaCare).

After 2 1/2 years, the leaders of the Plymouth colony decided to abandon their socialist charter and create a different system - one which honored private property.

Under their new system, the colony not only survived but thrived, and the abundance which resulted was celebrated at the iconic First Thanksgiving feast.

More here.

May everyone enjoy a peaceful Thanksgiving Day with our families and loved ones - and may we also not forget where the bounty of our great country actually comes from.

Winning Carrier Trick

Bob's written before about P.A.R.E. claims (Pathology, Anesthesiology, Radiology, Emergency), wherein certain providers choose not to participate in networks, and thus are free to charge pretty much what the market will bear. While there's not much one can do about that, one can at least reasonably expect such providers to follow the rules that are in place.

Like not double-billing for the same procedure:

"Blue Cross and Blue Shield of North Carolina ... argued that radiology practices were charging double for services provided only once and wanted the opportunity to cut reimbursements. It estimated that some $16 million was improperly charged annually because of this billing method."

That's not exactly pocket change.

As one might expect, the radiologists cried foul, arguing that this was tantamount to a contract re-negotiation without, you know, negotiation. BX countered that they were simply looking to "protect consumers and our customers from unreasonable charges."

In the end, the Tar Heel State's Department of Insurance sided with the BX folks; the losers doc's retain the right to appeal the decision in court.

[Hat Tip: FoIB Jeff M]

Die, Baby, Die (MVNHS© Edition)!

Turns out, it's not just our Neighbors to the North whose health care "system" has no real use for the weakest among us. Across the pond, the Brits' Much Vaunted National Health System© has its eye on the prize, as well:

"A mother has described how her baby was left to die 'like an abandoned animal' after hospital doctors repeatedly ignored her desperate pleas for help."

Hayley Fullerton, barely a year old, had survived a major heart procedure, but experienced complications that left her struggling to breathe. Her mother tried, desperately but unsuccessfully, to get those compassionate government health care "providers" to even look at the little girl.

Of course, they couldn't be bothered.

Nearly 3 years later, an official inquest concluded that "there had been 'serious failings' in Hayley's care."

Um, dunh?

Oh, but there's a bright side:

"Birmingham Children's Hospital admitted full liability for her 'avoidable' death."

See, everything's doddle!

[Hat Tip: Power Line]

MedTourism close to home

One of the issues we've had with the Not So Vaunted Health System© is that health care is becoming more scarce. As providers scramble for a way to stay in business, the cash-only model of health care delivery seems to be growing in popularity.

On the other side of the ledger, employers looking for ways to rein in health care costs are thinking outside the box, as well:

"This year, grocery giant Kroger Co. has flown nearly two dozen workers to Hoag Orthopedic Institute in Irvine and several other hospitals across the U.S. for hip, knee or spinal-fusion surgeries in an effort to save money and improve care."

As Bob reported last week, Wal-Mart is offering its employees free heart and spine surgery at a half dozen health centers of its own.

A major challenge is, as we've so long lamented, the lack of consistency and transparency in the cost of health care. Compounding the problem is the fact that there are separate fees for each service, so that a patient receives a bill from the hospital, the surgeon, the anesthetist, and so on. So-called "global billing" hasn't really happened, so employers are taking a cue from the cable and phone companies, putting together "bundles" that can help hold costs down and make price negotiations more meaningful.

As Rand Corporation's senior policy analyst Susan Ridegly puts it:

"We want to stop paying by the widget in healthcare."

Well said.

Ohio Draws a Line [UPDATED]

[Although we rarely do this, I am changing the published headline of this post to more accurately reflect what's actually going on. HGS]

This just in:

"Ohio will let the federal government run its health care exchange, a key portion of health care reform, Gov. John Kasich said today."

Oh, well, guess that means we avoid a nasty state constitutional crisis.

And this is priceless:

"Benefits of a federal exchange start with cost ... annual operating costs of a state exchange would range from $19 million to $34 million, excluding technology. Fees from providers and insurers would pay most of those costs." [emphasis added]

Yeah, be sure to let us know how that works out.

Not to mention: Buckeyes now get the privilege of susbsidizing the folks in states that set up their own Exchanges, forcing up our costs while driving down theirs (at least for a while).

Yippee!

[Hat Tip: FoIB Holly R]

UPDATE: Unlike Ohio's Gov Kasich, Pelican State Gov Bobby Jindal was a bit more forceful in rejecting a state-built ObamaExchange. Co-blogger Mike tips us to the Governor's official rejection:

"The full extent of damage the PPACA causes to small businesses, the nation’s economy, and the American health care system will only be revealed with time. The State of Louisiana has no interest in being a party to this failure by implementing a state based exchange."

That's gonna leave a mark.

UPDATE THE 2ND: And now add Texas to the list:

"Texas Gov. Rick Perry officially notified the federal government on Thursday that the state will not set up an exchange to help people buy health insurance."

I'm wondering if perhaps thinking that my title for this post was inappropriate.

Hmmm....

UPDATE THE 3RD: Thanks to the folks at RedState, here's the latest tally of states which have told Shecantbeserious to take a flying leap off the nearest ObamaExchange:

Oklahoma, Okay?

A month ago, Bob posted on a "unique practice at the Surgery Center of Oklahoma" which accepts only cold, hard cash on the barrel head.

No insurance, no Medicare or Medicaid, no third party payors of any kind.

So, how's that working out for the folks who run the joint?

From the horse's mouth:



[Hat Tip: Hot Air]

Consequences and Eddies

The fallout from the recently affirmed Not So Vaunted Health System© continues to build. And it's not just pizza, but a host of seemingly unrelated institutions.

FoIB Jeff M tips us to the recent announcement by Wake Forest Baptist Medical Center, which has recently axed almost 1,000 employees as a result of "the challenges of health-care reform, federal budget deficits and a decline in research funding from The National Institutes of Health and private industry.”

But it's not just the Baptists. At the other end of the spectrum, "the Roman Catholic church will not comply with the Obama administration requirement that most employers provide health insurance covering birth control." This is in response to the convenience items birth control mandate handed down by HHS Secretary Shecantbeserious.

And the hits just keep on comin': Palm Beach, Florida restaurateur John Metz has come up with a novel way to unbundle the extra costs of the NSVHS©. He's planning to "charge his customers a five-percent surcharge and decrease his employees’ hours to offset the costs of Obamacare on his businesses."

That's really a two-fer: by specifically noting the extra charge, customers get a real-world intro to the extra costs the train-wreck imposes on business. And servers get to see the effects of these costs on their own lives, both in terms of fewer hours (and lower net pay) and, presumably, lower tips (and thus lower net pay) as customers decide how much that service is worth versus the surcharge.

Talk about a Grand Slam.

Merp, Merp!

Hard to believe, but we really haven't covered Medical Expense Reimbursement Plans (MERPs) much here at IB. Back in August, Nate alluded to them when discussing small group plans and Health Reimbursement Arrangements (HRAs). MERPs allow an employer to help employees pay their health insurance premiums (among other things). Hamilton County (OH) is trying one out in an effort to manage its out-of-control health insurance costs by encouraging its employees to bail on the County plan in favor of a spouse's (or another job's).

It's kind of a neat deal, actually:

"Hamilton County, which employs about 4,000, is doing everything it can to prevent layoffs ... The MERP Hamilton County is implementing is a bit different from a traditional MERP ... The plan reimburses medical expenses incurred under “alternate coverage”

To get the full benefit of the plan, an employee has to waive off the County insurance plan in favor of the aforementioned spouse's or other employer-based health insurance plan. Interestingly, that plan cannot be a Health Savings Account. No can do? Fine, then stay on the County plan, but count on getting dinged more on your premiums.

And there's this: in addition to reimbursing an alternate plan's premiums, the new MERP will also help towards that plan's out of pocket expenses (deductibles, co-pays and the like). Even with all that, the county is looking to save upwards of $3 million next year.

Getting folks off group plans isn't new - we've seen this trend for a while. But it's generally been a "if you can go on your spouse's plan, you must go on it" type of deal. This "carrot" instead of "stick" approach may be the next big thing.

Thanks, Bob, for the tip!

Um, D'unh?!

I don't get why this would be "news:"

"Obamacare to Jack Up Insurance Premiums ... According to a survey from the National Business Group on Health, employers  expect their health insurance costs to increase 7%."

Hey fellas? Stop inhaling: only 7%? You wish.

And this:

"60% of those employers plan to ask workers to pay higher monthly premiums."

Also ignores reality. As we pointed out many years ago:

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

In case you missed that, let me repeat: Companies – businesses – pay neither taxes nor insurance premiums.

Companies do collect (sales) taxes, and pass them on to the states in which they do business. They also include any business taxes due in the price of the product or service. They pay employees a portion of their salary, and forward the balance to the insurance carrier (and/or state government).

They do not actually pay the taxes, nor the insurance premiums."

So this whole notion that employers are going to be asking what employees they have left to "contribute" more towards their premium is silly. And it ignores the fact that a lot of employers will be dumping either full-time employees or their group health insurance plans. Or both.

Of course, we'll continue to hear about how it's all the fault of business, but the reality is that businesses exist to make money, not to pay increasignly high labor costs (such as health insurance premiums). And now that our own Not So Vaunted Health System© (nee: ObamaCare) has been affirmed, this is just the beginning.

Kinda wish we'd read it before they passed it, no?

Can you hear me now?

The Brits' Much Vaunted National Health System© (MVNHS©) has long been a passion of ours, for (mostly) obvious reasons. The latest installment in the long-running joke that is the MVNHS© demonstrates what happens when physicians answer to bureaucrats:

"Doctors are failing to really listen to patients' views on how they want to be treated ... Involving patients in discussions about treatment could cut the cost of healthcare around the world"

Now, I'd take issue with that last - after all, "the world" is a pretty big place, and that which works in one country or culture might not translate so well to another - but the greater point is that docs in government-run health care schemes are accountable to the government, not their "patients." Indeed, since the government pays the bills, the patient really has little (if any) say.

The problem is that the payer (government) isn't the patient, who may well know best what it is that needs to be done:

"[P]reference misdiagnosis" - misinterpreting or ignoring the patient's wishes - is a significant problem which is damaging to both doctors and patients ... it can lead to, what they call, "silent" misdiagnoses - when doctors choose the wrong treatments because they fail to assess their patients' preferences correctly."

This was one of the most important aspects of consumer-driven health care (now outlawed under our own Not So Vaunted Health System©): transparency and financial empowerment (the premise and promise of Health Savings Accounts) did, in fact, rely to at least some extent on the patient's engagement with their provider.

As under the British system, the absence of this interaction can lead to devastating consequences:

"In one study they looked at, doctors believed that 71% of patients with breast cancer rate keeping their breast as a top priority, but the figure reported by patients was just 7%."

Of course there are trade-offs (life is, after all, a series of them), but divorcing the patient from his or her own care decisions seems a pretty drastic one. Of course, the person (or institution) with the gold makes the rules (cf: IPAB Death Panels).

[Hat Tip:Dr Dino Ramzi]

Cavalcade of Risk #170: Risky Business

Louise Norris at Colorado Health Insurance Insider presents an outstanding Cavalcade this week. Interspersed with risky quotes and photos, it's obvious that she's read all the entries, and provides helpful context for each one.

Do check it out!

Yet another example to why we should end entitlements as we know them...

From CNBC:

"Harris, a 22-year-old smoker, was set to see his cost per paycheck rise to $29.60 from $25.40. He says he has decided not to sign up for coverage. Given his low income, as Harris foregoes coverage any major medical bills could potentially fall to taxpayers through the government's Medicaid program."

$4.20, a pack a week? Maybe three packs a month and he drops insurance. Because he is busy engaging in activity that makes him more expensive to insure he can't afford insurance so the rest of us that are working get to pick up the tab.

Welcome to the Welfare State, get comfortable.

Vikings and The NSVHS©

Back in the day, Norway was known for Edvard Munch, Sonja Henie and Leif Ericson. But even the reviled Vidkun Quisling is most likely whirling in his grave over the current state of Norway's "health care" system:

"A man – let’s call him Joseph K. – is slicing up a cucumber when he suddenly cuts off the tip of his thumb. He hastens to the E.R., where a doctor clips off the finger of a plastic glove, pours antibiotic into it, slips it over the thumb, then wraps a bandage around the entire finger."

Ouch, but it gets worse. Fast forward a couple days:

"...the E.R. is simply not open at this hour. Until 3:30 P.M., the E.R. operates out of another location in the small, relatively remote town ... make an appointment if you insist, but you should know – there’s not always a doctor here!”

“What? There’s not always a doctor at the E.R.?”

“Yes, there’s not always a doctor here!”

Such is care under the Norwegian government-run health care system. Regular IB readers won't be surprised to read this, but it's what we have to look forward to under the recently affirmed NSVHS© (Not So Vaunted Health System©), formerly known as ObamaCare. When the government runs things, there are always shortages - of doctors, medicines, hospital beds, you name it.

Well, to be fair, not everything is in short supply: nameless, faceless, unaccountable bureaucrats are rife (if not readily accessible). As Bob's noted on many occasions, this kind of system is a real bargain - until you need it.

[Hat Tip: Joe B]

Shecantbeserious backpedals

Hurry up and wait:

"Health and Human Services Secretary [Shecantbeserious] said in a letter to governors Friday that she still wants to hear by the end of next week if states will be setting up new health insurance markets under the law ... states can now take another month, until mid-December, to submit detailed blueprints."

Those of the 58 states that are looking to partner up with DC for their Exchanges have until next February. Or later, one supposes, since there's really very little Mme Secretary can do to make them fall in line.

Which is perhaps a good thing, since at least one state (and likely several others) are going to find it, um, challenging to comply.

How's that, Henry?

Well, as Cato's Michael Cannon reports, "operating an ObamaCare exchange would violate [Ohio's] constitution."

This would seem an insurmountable problem, but there may be more to it. As it's Veteran's Day, I've had to put off until tomorrow my call to the Ohio Insurance commish asking about how this might play out. Looking forward to posting any results forthwith.

Medicaid solution for State Finances

As I am stuck doing all too often these days, I was reviewing some segments of PPACA for clients. An idea struck me on how to solve State spending and budget issues. Now that 1 in 5 people are covered by Medicaid, States are going to be forced to spend more of their limited finances on this healthcare plan.

According to Kaiser State Health Facts Ohio spent around $6,116 per Medicaid Enrollee in 2009. 

http://www.statehealthfacts.org/profileind.jsp?sub=47&rgn=37&cat=4

Drop Medicaid. Before anyone screams how unfair and cruel that is I'm not saying leave them without coverage, Obama said PPACA will make HealthCare affordable, so take him up on it.

"The Premium Credit" is available to people with incomes up to 400% of the Federal Poverty Level (FPL). For 1, 2, or 3 person households that is $44,680, $60,520, and $76,360 respectively. They would be required to pay between 2% and 9.5% of their income. Using 400% FPL and 9.5% maximum sharing cost the individuals would be responsible for;

#     Max Cost      Current OH Cost          Savings to the State
1 = $4,244.60      $6,116.00                            $1,871.40
2 = $5,749.40      $12,232.00                          $6,482.60
3 = $7,254.20      $18,348.00                          $11,093.80

The State could turn around and give vouchers to the residents to cover their liability under the exchange. It would cost the resident nothing. The resident would have considerably better coverage than Medicaid. The State would save billions. Doctors and Hospitals would be reimbursed at Private Insurance rates instead of Medicaid rates. There is enough savings left over they could even give employers $2,000 tax credits to offset their penalties, assuming anyone even employs more then 50 people come 1/1/2014.

Everyone is a winner...well except the Federal Government, but they'll just print more money anyways so it doesn't really even affect them.

Debate on Gov role in Healthcare already gone?

Many people disagree with the current and further intrusion into our healthcare by Government. They say government is taking too active of a role in what should be a personal matter. On my way to the office this morning I had the realization this argument might already be long gone.

For a brief moment driving to the office I was stuck behind the town leaf vacuum. For those not living in parts of the country with lots of trees, there is a city truck that drives around vacuuming leaves from people's yards. If we have outsourced such trivial matters as raking leaves to the government, managing our own health must no longer be possible.

In an ironic twist healthplans now pay us to exercise, i.e. to do something like raking the leaves. I think it is a short matter of time until we have cap and trade for calories. Don't worry I'm sure for a small fee we will be able to buy burned calorie credits from someone more willing to rake the leaves.

Fraudulent Agent Tricks

While most insurance professionals are just that, it's not always the case. As we saw not long ago, there are unethical agents out there, and sometimes they make the news.

Of course, it takes a special kind of stupid to defraud one of the best-known names in American culture, but that apparently didn't stop California insurance agent Jerry Goldman from trying:

"A Southern California insurance broker was arrested Wednesday on allegations he overcharged Tom Hanks, musician Andy Summers and others hundreds of thousands of dollars for insurance premiums."

Generally speaking, only the US Government is allowed to overcharge folks for insurance premiums.

According to the story at the link, this little game has been going on for over 13 years. It appears that he overcharged his clients, remitting the actual premium due to the carrier(s) while keeping the difference for himself.

One rarely (if ever) sees this on the life and health side, since the premiums for these types of plans are almost always submitted directly to the carrier, or at least with checks made payable to them. On the P&C side, though, this isn't always the case, which is why this kind of mischief can occur.

Credit where it's due, however: at least the agent submitted the proper premiums, so that the coverage was (presumably) in force had a claim occurred. The coverages ran the gamut from cars and property to worker's comp and fine art.

Health Wonk Review: Post-election edition

HWR co-founder (and all around good guy) Joe Paduda hosts this post-apocalyptic election round-up of posts from around the health wonkosphere. There's a lot of information, speculation, adulation and frustration, but well worth clicking through for an idea of what's in store health policy-wise.

Cavalcade of Risk #170: Call for submissions

Jay Norris next week's Cavalcade of Risk - Entries are due by Monday (the 12th).

To submit your risk-related post, just click here to email it.

You'll need to provide:

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

PLEASE remember: ONLY posts that relate to risk (not personal finance tips and the like). And please only submit if you are willing to link back to the carnival if your submission is accepted.

Thanks!

And that's that: Introducing....

According to erstwhile House Speaker John "Boom Boom" Boehner:

"It's pretty clear that the president was reelected, Obamacare is the law of the land."

Fine.

So begins a new chapter here at IB, as The ObamaTax becomes the Not So Vaunted Health System©. The NSVHS© is characterized by guaranteed issue insurance, which guarantees only that rational people will wait to buy their policy until they're in the ambulance. It means that rational people will look at the fine penalty tax of a few hundred or so dollars and deduce, quite rationally, that paying thousands of dollars for a policy when one is well makes no economic sense.

Rational people will understand, of course, that actual health care will, of necessity, become rationed as a direct consequence of other folks being subsidized to buy new policies, creating ever more increasing demand, even as provider reimbursements falter (a consequence of the $700+ billion Medicare cut).

Rational employers will understand that the $2000 per employee fine penalty tax is also a bargain compared to the tens of thousands of dollars group plans will now cost as a result of things like the "Mercedes" er, "Cadillac" tax and other such goodies.

It means that health care quality will decline, as will new medical tech. It means that seniors will have fewer choices, perhaps not even the choice of whether to live.

Over the next few weeks and months, Mme Secretary Shecantbeserious will begin to roll out all the new rules and regs that will dictate how the government will direct our your health care.

Not with a bang, but a whimper...

And so it begins...

As we've long predicted, the ObamaTax has begun its march towards higher unemployment:

"A Las Vegas business owner with 114 employees fired 22 workers today ... the regulations for Obamacare are gonna hurt our business, and I’m gonna have to make provisions to make sure I have enough money to cover the payroll taxes, the additional health care I’m gonna have to do"

Tipping point.

From the P&C files: BizInt coverage

Business Interruption coverage helps pay the bills when your store or plant are shut down because of some natural or other disaster. When we think about business insurance, we usually think about fire damage, or flooding, that kind of thing. And of course that's important. But what we may not think about is how the business itself can continue as a result of a catastrophe.

Hurricane Sandy provides an excellent object lesson in how this important coverage works. The folks at Allianz Global Corporate & Specialty has come out with a new study -  “Managing Disruptions” - that "explores how businesses and insurers are re-examining their exposures to business interruption and supply chain risk."

As a friend of mine is fond of saying, we are all connected. So it's not just about a given business, but its place in a supply chain and how that can disrupt other businesses up and down that chain.

It's an interesting subject, and a glimpse into an area of risk assessment and management that we don't often get.

[Hat Tip: Annika Schuenemann]

Medical Tourism and the ObamaTax

Now that the ObamaTax has been affirmed, it's time to look ahead. This means a shortage of providers and major increases in both premiums and health care costs. There's not much one can do about the increased premium side of the equation, but there are indeed ways to mitigate both the provider shortage and increased cost of care.

While medical tourism has been around a while (we first posted on the phenomenon over 6 years ago), it seems poised to really take flight under the ObamaTax regime:

"US patients obtain health care treatment in foreign countries well below US rates. Treatments include dental implants, hip and knee replacements or bariatric surgeries. Americans also go abroad for more complicated procedures such as heart operations and cancer treatment, or alternative therapies such as stem cell treatment unavailable at home."

And that's already occurring. As folks begin to see hospital waits getting longer and longer, and the costs of care getting higher and higher, it doesn't seem far-fetched that those who can will opt for a short (or long) plane ride, the expenses of which are potentially more than offset by the savings (and, of course, the actual delivery of care).

Pipe dream much, Henry?

Perhaps, but then again:

"Some US businesses already persuade employees to travel for treatment. Medical tourism experts see that becoming more common in the future. With incentives like deductible waivers, the plan saves money for the insurance company, the business and the employee."

And there's nothing preventing carriers from offering optional med-tourism riders or supplements. And competition among foreign providers for American patients may also prove enticing.

Time will tell.

ADDENDUM: Can't believe I missed something so obvious, but of course the Independent Payment Advisory Board (IPAB) Death Panels will also be a major driver of MedTourism. After all, if you or your loved one (or ones) face a literal death sentence, then a quick jaunt to (say) Costa Rica may seem pretty reasonable.

Speaking of pains in the...

Although the new ObamaTax rules require health insurance policies to pay for routine colonoscopies (YMMV), that may turn out to be not much of a big deal:

"For some people, one colonoscopy at age 50 may be enough for their whole lives, a new study suggests."

The study found that folks who got a "clean bill" from their first procedure turned out to live just as long as those who repeated the process a few more times. Which isn't to say that no further effort's required:

"[F]or people who received a negative result on their first colonoscopy, it is reasonable to switch to other, less invasive methods for subsequent screenings."

Whew!

Ca$h for (Annuity) Clunkers

Fortunately, this isn't a government-run program:

"Hartford Financial Services Group Inc. has offered some of its annuity clients cash for their contracts."

As regular readers know, Variable Annuities can be solid financial vehicles (they can also be dangerous, but that's another post). When the stock market takes a dive, insurers who issued the policies can find themselves "upside down" because of guaranteed payouts in the contract.

So Hartford's looking to get out ahead of the problem by buying out policyholders who themselves might be feeling a financial pinch. So if you're a Hartford Variable Annuity owner, best be watching your mailbox.

Shecantbeserious keeps flailing away

Mme Secretary just can't seem to help herself:

"The Obama administration is relying heavily on outside contractors to implement a core component of [the ObamaTax[ as it races to set up a federal health insurance marketplace before 2014."

When you have to pass it to learn what's in it, hilarity ensues.

And by "hilarity," I mean "incompetence:" in the rush to set up phony Exchanges, Ms Shecantbeserious has continued to spread her largesse to her cronies, including a subsidiary of United Healthcare.

But wait, weren't we told that private insurance companies were evil, and at the root of all of our health care problems? Apparently that hasn't fazed the Secretary, who's contracted with Quality Software Services, Inc. (QSSI) to build and maintain the databases that will form the backbone of the Exchanges.

All of this took place, of course, with no oversight or input from the Securities and Exchange Commission, which would seem to be an indication that all is not aboveboard. But of course, this hasn't stopped Ms Shecantbeserious before.

After all, what could go wrong?

[Hat Tip: Hot Air]

Obamacare to create Millions more working poor

Obamacare penalizes employers for full-time (FT) employees that are not insured if they don't offer affordable and essential coverage. Employers will obviously look for ways to minimize this damage. One way is by turning FT workers into part-time (PT) employees.

http://nrn.com/article/restaurants-mitigate-health-care-costs-cutting-hours

Darden Restaurants runs over 2000 restaurants, they are testing working employees 29 hours. I have heard of nursing homes in OH that are also moving their FT to PT.

You would think this is a problem for employees, having their hours cut, are they going to have to find second jobs? Turns out it might be win win for everyone but the taxpayors.

Someone working full time making $9.50 per hour makes $1646.92. If they have their hours cut to 5 3/4 a day they would make $1,183.72, a pay cut of $463.20...or is it.

With two people in the household working full time they do not qualify for Food Stamps. Working 2.25 hours less they qualify for $367 a month in benefits. 

Once you qualify for food stamps you automatically qualify for a free lifeline cell phone, worth about $30 per month. 

They would also now qualify for utility assistance.

Instead of paying 9.5% of their income to be on their company plan they pay 2% under the exchange saving an additional $88.78 per month.

Not counting any other additional programs and assistance, by working fewer hours these employees gain  $485.78 in taxpayor funded benefits to offset $463.20 in lost wages. The employer also avoids any taxes for not offering coverage.

Besides all of the problems Obamacare creates for the insurance industry it is likely to push millions more into poverty with even fewer chances to get out.

Taxes and Fees and Penalties - Oh my!

FoIB Bob D sends us this report from Aetna enumerating the new taxes on tap for us under the ObamaTax.

Here's a taste:

■ Health Insurer Fee
■ Transitional Reinsurance Program Contribution
■ Patient-Centered Outcomes Research fee
■ High Value Plan tax (aka **BMW** Cadillac Tax)

But wait! There's more!

New annual taxes on "Big Pharma," new annual taxes on medical device manufacturers, and the list goes on.

Download the report here.

E&Oxchanges

Because we already know just how efficient government bureaucracies are (*cough*), the latest anticipated problem with the ObamaTax Exchanges should come as no surprise:

"The [ObamaTax] could create new opportunities for employers to get health insurers to compete for their business -- and new opportunities for health insurance exchanges to mess up enrollment."

Think about it: these are the folks who run the Post Office and the DMV, and they're going to be in charge of making sure that employees are properly enrolled when employers begin to shed group health plans.

This is pure wishful thinking:

"[B]rokers have to think just as hard about how the enrollment process will work when they are placing business through an exchange as when they are dealing with one of the "back end" companies that handles enrollment data or send enrollment data directly to insurers"

Um, no, they're not, because no professional agent is going to touch an Exchange-based product with a 10 foot Czech. And those dumb enough to go that route have bigger problems than Errors and Omissions coverage.

And woe to the employer that thinks going through an Exchange is a good idea:

"An enrollment system may greatly increase the employer's risk ... by letting employees sign up for coverage they are not eligible to buy."

Why would any reasonably intelligent employer even bother? Much more cost effective to delete the group plan and take the (nominal) fine tax hit. After all, choosing to use an Exchange means that the employer is trusting a government bureauweenie to get things right and if they don't, well, good luck holding them accountable.

But hey, it's a Brave New World.

ObamaTax legal update

Early last month, we noted Liberty University's pending ObamaTax lawsuit challenging the Employer Mandate. Today comes word that the Justice Department apparently has no objections to the lawsuit going forward [ed: I'm not a lawyer - and I didn't stay in a Holiday Inn Express last night - but who cares if the DoJ objects?]:

"In a brief filed with the Supreme Court late Wednesday, the Justice Department said the court should clear the way for a possible new hearing in the lawsuit filed by Liberty University."

It's still a long way from a "done deal" but at least there's progress.

LTCi November

November's been designated as national Long-Term Care Awareness Month. We've blogged on Long-Term Care insurance (LTCi) often here; my favorite post on the subject (and one I send to pretty much every prospective LTCi client) is this one from LTCi guru Herman Bruns.

Another LTCi expert is Christine van Breukelen, who alerts us to these "fun" facts:

■ Most long-term care is received at home; not in a nursing home.  In fact, 43% of long-term care insurance claim benefits paid to individuals covered home care (and only 24% paid for nursing home care.)

■ One of the significant ways to save on long-term care insurance protection is to take advantage of available discounts.  People in good health can save.  You can lock in these savings even when your health changes.  Less than half (44%) of people between 50 and 59 qualify though and that percentage declines at older ages.  Why not see if you qualify.

■ Married couples can save on long-term care insurance, sometimes even when only one person is protected.  And with new "shared care" options, two people can actually share each other's coverage.   Less money … more benefit … worth considering.

And Chris adds: There's a great saying; Failure To Plan is a Plan For Failure.  Your first step should be getting the information you need to protect yourself, your family and your loved ones.