Helpful Thanksgiving ICD-10 Codes

As co-blogger Kelley last mentioned a couple of months ago, the "new and improved" ICD-10 codes are on the way (maybe). And just in time, too; the folks at Health Data Management have helpfully compiled a list of handy dandy ICD-10 codes specifically geared for Thanksgiving:

"Ah, the turkey is roasting and the potatoes are boiling. And Cousin Carl just chopped the end of his finger off while preparing the veggie tray."

Click through for the whole list.

And Happy Thanksgiving to you and yours!

[Hat Tip: FoIB Dr Rob]

"I forgot"

It's hard to beat this Steve Martin excuse:

"You.. can be a millionaire.. and never pay taxes! You can be a millionaire.. and never pay taxes! You say.. "Steve.. how can I be a millionaire.. and never pay taxes?" First.. get a million dollars. Now.. you say, "Steve.. what do I say to the tax man when he comes to my door and says, 'You.. have never paid taxes'?" Two simple words. Two simple words in the English language: "I forgot!"

Funny, but what does this have to do with insurance?

Glad you asked.

The folks at LifeHealthPro have complied a list of the 5 best excuses one might use to duck the (Evil) Individual Mandate. Here's a sampling:

"I don't earn enough to even file a return."

"Missed it [the cut-off date] by that much!"

And this gem:

"I get my care from Drs Tonto and Geronimo."

Jake must be jealous.

Cavalcade of Risk #222: Gratefully risky

Van Mayhall hosts the pre-Thanksgiving round-up of risk-related posts. As usual,Van does a terrific job of tying together seemingly unrelated items, providing a fantastic narrative.

Thanks, Van!

Sprechen sie Deutsch?

More proposed Obamacare rules to improved the customer experience.

The Centers for Medicare & Medicaid Services Nov. 21 issued a massive 324-page notice of proposed rulemaking aimed at improving the consumer experience in the health insurance marketplace by increasing pricing and plan transparency and making information more accessible to consumers, among other changes.

Key among the controversial proposals is the requirement that all exchanges, qualified health plan insurers, and Web-based brokers and agents provide telephonic interpreter services in at least 150 languages. That requirement does not extend to navigators and assisters, although HHS is asking for public comment on whether it should.

Insurance Broadcasting

Seriously?

Hunh: CCC's no more

Had a "d'oh!" moment when I received this in email:

"[G]eneration of HIPAA Certificates of Creditable Coverage (CoCC) upon member termination will no longer be necessary because the pre-existing condition limitations are fully eliminated in 2015."

Since 1997, group plans have had to issue Certificates of Creditable Coverage when a covered employee (and/or dependent) dropped off. They were essentially "hall passes" to the next group plan, so that one wasn't subject to pre-existing condition limitations.

[ed: Contrary to popular belief, they were of no avail when moving from group to individual plans - but were applicable when moving from individual to group. Clear as mud, no?]

These cert's have been part of the landscape for so long now that it just didn't occur to me that, once the ObamaTax is in full swing, they're no longer necessary.

Think I'll miss the little buggers.

Missing the Mark, MVNHS©-style

Last month, we questioned whether the Much Vaunted National Health System© was worth saving (assuming it could be, of course). Thanks to co-blogger Bob, we have more evidence supporting the "No" position:

"The NHS in England has repeatedly missed a key target for rapidly treating cancer patients ... Cancer charities said thousands of patients were being failed."

Of course, that pre-supposes that the actual goal was saving lives, not pounds sterling.

So how does that translate into real-world, real-people numbers?

Well:

"[O]f the 33,404 people who started cancer treatment between July and September, more than 5,500 were not treated within the 62 day target."

Depending on the3 type and stage of the cancer, that two months can very easily mean the difference between life and death, lumpectomy or double mastectomy. And it's not getting any better for our Cousins Across the Pond:

"These breaches have become a trend and they are worsening, which is why urgent action must be taken to support the NHS" according to Sarah Woolnough, from Cancer Research UK.

It's also worth noting that the shortage of radiologists, which has exacerbated the problem:

"Patients are waiting too long for imaging test results."

Coming soon to an ObamaPlan near you.

Blast from the Past

I first became a fan of Medical Savings Accounts (since evolved to Health Savings Accounts) way back in 1992, when they were first introduced by Golden Rule Insurance. GR's president at the time, Pat Rooney (whose family, if I recall correctly, founded the company), eventually left to found another carrier, Medical Savings Insurance Company (MSIC), which marketed MSA's exclusively.

In 2008, MSIC went into receivership to protect its over 6,000 policyholders. Having fallen on hard times, the company faced substantial financial hurdles. On the bright side (and in a bit of irony), policyholders were transferred to Golden Rule.

Reason I bring this up is that I had written a couple cases with MSIC back in the day, and over the weekend I received a "Notice of Hearing" for final liquidation of the firm's assets.

Or not:

"[T]he Liquidator reports that all assets and/or property ... have now been recovered ... does not have sufficent assets ... no MSIC assets are available for payment."

Shorter: if you think MSIC owed you anything, don't count on it.

The better, more positive lesson for me, though, is that this doesn't affect policyholders: the system worked, and they weren't left holding the bag.

Well, at least not by the Indiana Department of Insurance.

Chicken Soup for the Health Care Policy

We've long documented the utter failure of nationalized "health care" schemes to rein in costs any more efficiently than our previous, market-based system. From Jolly Old to The Great White, failure is, in fact, an option.

And so it goes in the Holy Land, as well:

"The cost per household for supplementary health insurance from one’s public health fund and for commercial (private) health insurance increased significantly – by 8.5 percent – in 2013, compared to only 4% in 2012."

Catch that? Even (especially?) in nationalized systems, "supplemental" coverage is de rigueur . And what does that portend for the Israeli (to name just one) system?

Well:

"This is a likely sign that public insurance coverage is not regarded by citizens as enough and that accessibility to care from the public health funds and hospitals is declining."

No kidding.

[Hat Tip: FoIB Holly R]

MVP Struggling - Part 2

A few days ago, we broached the subject of Minimum Value Plans, and their potential role in mitigating group health insurance costs. In that post, co-blogger Nate shared with us a TPA's view of how this might play out.

At the time this whole concept hit my radar, I was invited to interview a benefits attorney with expertise in this area for another perspective. Kurt Anderson has specialized in employee benefit, and especially ERISA, plans for the past quarter century, and is co-author of a book on health care reform.

Kurt, like myself, believes that insurance should really focus more on risk-based, catastrophic events (such as illnesses or injuries) and less on predictable, routine items (such as preventive care, vaccines, etc). In fact, he offered this absolutely terrific take on the problem with mandated benefits and the ACA:

"If you can budget for it, you shouldn't have to purchase insurance for it."

This comports precisely with our own comparison of auto insurance paying for oil changes.

This led us to a discussion of how the employer mandate/tax will be enforced. To understand the current controversy, it's necessary to understand the stakes:

An employer (of specified size) that offers no group health plan is subject to a $2,080/employee fine tax penalty, period. This is called the "strong" penalty because it counts all employees.

If that same employer offers a group health plan, but that plan is either "unaffordable" or lacks "minimum value" the penalty is $3,120 per employee, but applies only to the number of full-time employees that opt out of the group plan and buy subsidized plans on the Exchange instead (and rotsa ruck with that). This is known as the "weak" penalty. What's interesting is that an employer that offers a "minimum value" plan that costs less than 9.5% of take-home pay ducks this penalty.

And that's the crux of the proposed IRS ruling: as Kurt explains it, employers want to save money while (legally) avoiding taxes, but still provide basic coverage. The problem is that, if the employer's affordable plan offers "minimum value" but that plan is so skinny that it doesn't provide coverage for hospitalization and other costs that folks need "real" insurance for, then the employee is screwed – he isn't eligible for a subsidy if he chooses to reject the skinny plan and get "real" insurance from the Exchange. By regulating that a "free oil changes only" plan can't satisfy minimum value, the IRS "fix" means that more employees would be subsidy-eligible. And from the employer perspective, it's still (likely) cheaper to pay the penalty for those employees who get subsidies than to provide and pay for more comprehensive coverage.   Win-win.

A big IB Thank You to Kurt Anderson for his time and expertise, and Joan Heider for putting us together.

Cavalcade of Risk #222: Call for submissions

Van Mayhall hosts next week's edition. Entries are due by Monday (the 24th).

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.

Close enough for gummint work

So it seems that, as we'd already surmised, the reports of how many people actually bought ObamaPlans were, well, less than truthy:

"A report by Bloomberg’s Alex Wayne revealed that the administration quietly lumped as many as 400,000 dental plans into the total enrollment number without telling anyone."

So almost a half million "false positives." Par for the course, no?

Unintentional Medical Tourism

Before we begin, it's important to note that there's a LOT of information missing here. Of course, that hasn't stopped folks from piling on. As best we can tell, these are the bare facts:

A 6-months pregnant Canadian woman took a personal trip to Hawaii. While there, she gave birth to a daughter, who ended up in the Neonatal ICU for several months, racking up $1 million in medical bills. Her national health insurance plan paid $20,000, and (for some undisclosed reason) the US paid an additional $12,000.

The controversy arises due to the fact that, prior to departure, she had apparently purchased a travel plan from a Canadian Blue Cross affiliate, and they have denied the claim. According to Ms Huculak, they are citing pre-existing conditions as the basis for their denial.

[ed: In case you're wondering, one of the worst kept secrets about the Canadian national health care scheme is that folks "in the know" purchase private coverage to supplement it]

And here's where it gets, well, interesting. For example, Ms (Mrs?) H claims that her doctor had given her a "green light" to take the trip, despite the fact that, only two months previously, she'd had a bladder infection and hemorrhaged. She says that her "doctor saw no reason for me not to go." Which is nice, but entirely irrelevant. Perhaps she could turn the delinquent bills over to him for payment.

She also says that "her doctor sent a letter to Blue Cross confirming that Huculak’s pregnancy was stable when she went on vacation, but the claim was still denied." Again, without more detail as to why the claim was denied, we can only speculate. Regardless, an insurance company has no obligation to give any weight or credence to anything a doctor not in their employ has to say.

I reached out to the folks at Saskatchewan Blue Cross to see if they could shed some light on some of these issues, and will have an update when (if?) I hear from them. The Canadian Blue Cross is not affiliated with the one here in the states, and has a different product line, including travel medical plans.

So, since traditional media continues to do such a shoddy job of basic research, I went to the SBC site and took a look at the policy details, and specifically the exclusions. And lo and behold, we find this at the #3 spot:

Any expenses related to a medical condition (whether or not the condition has been diagnosed or the diagnosis has changed) for which any symptoms occurred during the six (6) months prior to the Effective Date for Covered Persons:

• consulted a physician
• was hospitalized

Well, she'd obviously consulted a physician, and it's entirely likely that she'd been hospitalized for the hemorrhaging. The fact that she had failed to read the policy (and note its exclusions) is on her.

Oh, the most profound lesson here: turns out nationalized health care doesn't work. Who'da thunk it?

Health Wonk Review: Gobble, gobble edition

David Harlow presents a veritable brain-feast, replete with interesting, thought-provoking posts and mouth-watering illustrations.

Enjoy!

Movember: Men's Health Alert

A few weeks ago, we highlighted October as Breast Cancer Awareness Month, and raised $800 towards research to fight this terrible illness. This month, we turn our attention to the Y-chromosome side:



(And watch through to the end for more info on how to help)

PresBo lied, Healthcare Died

The right-wingers at CNN have released a video showing - conclusively - that the goal of the ACA ObamaTax was always to destroy the previous system and increase taxes:

[Hat Tip: Ace of Spades]

Web (in)Security

Yesterday,  I received the following from CoveredCA: 

New!  iPad Online Application:  Replace "HTTPS" with "HTTP" in URL Address

If you are using your iPad for enrollment and already have an URL saved to get to the open enrollment online application, you will need to update the URL Hyper Text Transfer Protocol Secure (HTTPS) address by removing the “S” from the “HTTPS” in the URL address so you can access the open enrollment online application. 

Seriously?   HTTPS is the secure protocol for transmitting information over the internet. HTTP is open text that's readable by anybody who intercepts the transmission.  Nobody should EVER use HTTP for any kind of sensitive work...even Facebook uses HTTPS:

GruberGate in 2 1/2 Minutes

[Hat Tip: Ace of Spades]

Killing Time

Obamacare 2015 open enrollment is here. 

Good news is, the site seems to be working, kind of .........

Bad news?

Consumers there were having a hard time logging into their accounts, retrieving old passwords and proving they were who they said they were — a process known as identity proofing, which also vexed many people last fall. Some people did complete their applications at the Manassas clinic on Saturday, but it often took them 90 minutes.

NY Times

Babies are birthed faster than that.

Who has 90 minutes, or longer, to wait to get into their account? And that's on top of queuing up at your local Obamacare office.

Similar problems frustrated Lorena Ortiz, 40, of Woodbridge, Va., who tried to switch plans in a conference room at the clinic that Ms. Burwell visited on Saturday. Ms. Ortiz had signed up for coverage in the first enrollment period, but could not remember the password for her account on HealthCare.gov.

She and a certified application counselor, Kathleen May, spent an hour trying to retrieve Ms. Ortiz’s old password — even making a call to the HealthCare.gov call center — to no avail. They waited for a new password to come to Ms. Ortiz’s email address, but it never did.

Then they tried creating a new account. At first that did not work, either, so they tried using a different email address for Ms. Ortiz. When Ms. Burwell walked into the conference room to greet clients, Ms. May and Ms. Ortiz did not even look up.

They finally succeeded in creating a new account for Ms. Ortiz with a different email address. But then they could not link her old health plan to her new account.

Smooth ..............

Rube Goldberg would be jealous.

Stupid Carrier Tricks: Timing is Everything edition

A few weeks ago, I mentioned that Anthem had sent out a batch of December 1 individual medical plan renewals for these "grandmothered" plans. Yesterday, I received a similar batch of January 1 renewals for some Medical Mutual clients.

Keep in mind that I received these on November 17th:

And when were they actually mailed?

[ed: date highlighting added]

Great timing there, MMO.

Sheesh.

GruberGate: The Musical

[Hat Tip: PowerLine Blog]

MVP Struggling - Part 1

Minimum Value (aka MVP) Plans have been touted for groups over 100 (this year, and 50 next year) wishing to meet the letter of the ObamaTax law and yet minimize their costs. The Government published an online calculator where employers could enter their plan benefits and determine whether it met the minimum value test themselves, and avoid the cost of hiring an actuary. As we blogged a few months ago, the calculator included a "glitch" which allowed employers to exclude in-hospital services (and some other high cost benefits) and still pass the 60% threshold, and therefore some of the penalties taxes.

That's now changed. The IRS and HHS have now warned plans that they will fix the calculator, and the definition:

"[C]ertain group health plan benefit designs that do not provide coverage for in-patient hospitalization services are being promoted to employers. A plan that fails to provide substantial coverage for these services would fail to offer fundamental benefits ... plans that fail to provide substantial coverage for in-patient hospitalization services or for physician services ... do not provide the minimum value intended by the minimum value requirement."

Shorter: no, MVP's with no hospital coverage don't make the cut. Interestingly, so-called "skinny" plans with hospital and other Minimum Essential Coverage are still okay.

[ed: I'll refrain here from opining as to whether or not it's really the place of unelected, unaccountable bureauweenies to make these determinations]

So, what to do? A whole cottage industry has sprung up touting these plans as an affordable alternative to full-blown (and expensive) group plans, and at some point in the (presumably near) future, new rules will be put in place to cut them off. What then?

One option, of course, would be to just stop offering group coverage altogether, and just pay the tax penalty fine (which is likely to be a LOT less than any premiums). Another would be to offer a slightly "less skinny" plan that does cover in-hospital charges in a way that satisfies Our Betters in DC©.

The folks at OptiMed Health claim that their plan offers "independent actuarial certification and statement of compliance." Which is nice, and perhaps a viable alternative for employers who want to avoid both the penalty and bankruptcy.

My co-blogger Nate Ogden has another, intriguing, thought: why not offer a good plan, with around a 55% Actuarial Value, that covers the majority of people’s healthcare expenses. It would exclude hospital inpatient, therapy, and prolonged treatment. But it would cover, at a low cost, the majority of people’s needs for the year. This way most healthy people can get on a low cost plan and the employer won’t pay any penalties for them. Sick people in a group would still be subsidy eligible, so they could buy a more comprehensive plan on the Exchange, and their net cost is reduced by a subsidy. This appeases the government officials who concern with MVP minus hospital was they precluded individuals that needed coverage from getting a subsidy

The purpose is to satisfy the "80/20 Conundrum:" insure the 80% of the group that only accounts for 20% of the cost, then pay the $3,000 penalty on the 20% of the group that accounts for 80% of the costs.

Of course, you'd want to work closely with your agent and/or TPA to make sure all the i's are crossed and the t's dotted.

In part 2, we'll hear from a Benefits Attorney with another take on this development.

Winner, Winner Chicken Dinner!

So a colleague recently clued me in to a way that the free market is responding to the new reality of an Obamacare-dominated health insurance market. The good news is that the concept seems to be perfectly legit, serving the interests of both the client and the agent (and his carrier). The bad news is that the plan is only available in a dozen states so far, although it has been filed and is pending approval in almost all states (although it's available only from agents of one carrier).

Still, it's a fascinating glimpse into how one can "reverse engineer" a desired outcome. I'll let Dave take it from here:

"You're going to like this, it's damn brilliant. Basically we're offering a limited benefit product that's very cheap compared to Obamacare. Assuming that no major illnesses or injuries come up, it'll pay almost all of one's medical costs with no deductible. The capper, though, is that the plan has a rider that allows the insured, at their discretion (and with with no additional underwriting) to convert it to a major medical plan with a $3,000 deductible and 100% coverage after that.

That major medical plan runs until the insured's next open enrollment period. So, cheap insurance for as long as you need it, the option to switch to a major medical plan even AFTER you get ill (but not requiring you to pay for it until you need it), and a guaranteed transition to O'Care (which, being guaranteed issue, is the appropriate place for high risk individuals). I'm going to sell a boatload of this product, and best of all, nobody loses."

Indeed. The only real drawback I see would be the potential for the individual mandate tax penalty fine. On the other hand, I'm told that it's priced to have a lower premium than a "metal plan," even with the tax penalty

Now here's where it gets, well, weird: almost six years ago, the (now defunct) American Community insurance company rolled out a very similar plan:

"Called "Community Flex," it starts out as an accident policy (major claims are only paid for injury, not illness), with some coverage for doc visits, preventive care, and a drug discount card ... if you want more coverage, such is available through a "Gold Plan" buy-up. This gets you coverage for more doctor's visits, more preventive care, and better prescription drug coverage."

So, not exactly the same, but similar concept. Currently, my colleague's company is the only one (of which I'm aware) that has developed this new-fangled ObamaPlan alternative.

Be nice if there were others (hint, hint).

The Gruber Hits The Fan

You knew this was coming, right?

"In Jon Gruber's Newest (Sixth) Video, He Explains How Obama and Democrats Conspired to Get Rid of Tax Exemptions for All Insurance Plans Without Anyone Noticing"

Boom.

HIX Predix

I have a few predictions about tomorrow morning:

■ The sun will rise in the east

■ Water will be wet

■ The 404Care.gov site will be broken

Why does the last one seem no less obvious than the first two?

From the horse's, er, mouth:

"Health Secretary Sylvia Burwell warns, “we will have things that won’t go right. We will have outages, we will have downtime.”

And it's no ray of sunshine for small businesses, either.

Up-Lyfting Update

Last week, we noted car-sharing service Lyft's first passenger fatality, and pondered the insurance implications thereof. Since this situation is a bit outside our wheelhouse, we turned to P&C expert (and long-time FoIB) Kevin Sullivan.

I really didn't know what questions to even be asking, what issues (beyond the obvious) were relevant, and what part the location (California vs, say, Ohio) would play in this whole scenario. He kindly supplied not only the necessary questions, but the answers, as well Take it away, Kevin:


The insurance test here:  Will Lyft's Commercial General Liability, or Business Auto coverage defend the Lyft driver?

IMHO, it doesn't matter if it's the driver's fault.  Everybody's getting sued.  Lawyers cost money [ed: this is a point our friend Bill M made, as well].

If the driver has a commercial auto policy, and he's not found criminally negligent (drunk, on drugs, etc), they defend/settle.  My guess:  The driver has no such insurance.  Personal Auto expressly EXCLUDES using your vehicle to make money.  However, the coverage exists, otherwise, you wouldn't be able to get a pizza delivered to your house.  The Pizzeria (Lyft) purchases that cover.

Back to Lyft: 

1.  Is the driver named on Lyft's policy?  Or is he listed on just an "Additional Insured" endorsement? 

2.  $1,000,000 Combined Single Limit?  Liability only?

3.  What carrier wrote the Lyft policy?  That would tell me a TON...

Looks like Lyft's insurance is prepared to pay or defend.

Here's how this is all going to go down:  Settlement will occur, nobody will know how much.  Lyft will either need to find another carrier, or pay a TON more in premium.  A non-renewal (cancellation) is also possible.  Again, I'd need to know the carrier before I'd guess.

Lyft could go out of business for not being able to find a new insurance carrier.  That won't matter: another service will come along, and replace them.  Ride-sharing ain't dying.

In the big picture, the carriers are playing "wait and see" with this new auto niche.  Trust me, they are crunching numbers right now, and will develop a product for the "part time TNC (Transportation Networking Company) driver" for Uber, Lyft, Sidecar, etc.

If they had HALF A CLUE, the TNC's would create a "driver's association" for ALL ride share drivers.  As a member of the association, you'd get access to the association’s insurance plan at $X,XXX per year [ed: similar to how many professional organizations sponsor life or disability insurance].


Thanks, Kevin!

This is still a relatively immature market, with plenty of room for expansion, and missteps. But as Kevin notes, there's just too much pent-up demand, primarily tech-driven (all those iOS and Android apps aren’t going to drive themselves, after all). And the centuries old taxi-cab model with its expensive (and increasingly outmoded) barrier to entry just doesn't seem sustainable. On the other hand, folks want to know that they're protected from the risk of someone else's driving.

Something's gonna give, it's now a question of how and when.

Peanut Butter and Chocolate

You got feckless, clueless punditry in my O'Care deceit lectures.

No! You got O'Care deceit lectures in my feckless, clueless punditry.

Kiddies, kiddies, please calm down. You're both right:

[Source]

Now Playing: HIX (Health Insurance Exchange)

Interesting video primer on how the Exchanges (are supposed to) work:

Three Strikes, Herr Gruber....

If you've been following the saga of Jonathan "Fredo" Gruber, you know he's on record for speaking his mind calling the American electorate stupid. Now comes word that he's been at it again:

"A third video has surfaced of Obamacare architect Jonathan Gruber bragging about pulling the wool over the eyes of the American public in order to help implement Obamacare."

Third time's a charm, right?



                         [Skip to 29:26 for money quote]

Cavalcade of Risk #221: Post-election round-up edition

Claire Wilkinson hosts this week's collection of post-election risk-related bloggetry. From upcharges for where you shop to high wire (literally!) acts, you're sure to find something interesting.

Thanks, Claire!

Obamacare's House of Cards

Did you know almost 25% of individual health insurance premiums paid for exchange plans go directly to taxes and fees? Did you know that you, as taxpayers, are funding 76% of the total premiums? While some call American voters stupid, the reality is consumers are simply uninformed about the Unaffordable Care Act.

While the law passed in 2010, taxpayers are now learning about the complete lack of transparency coupled with misdirection and layers of bureaucracy created in Obamacare. This is because during the first four years all of the warm and fuzzy benefits were implemented. These provisions were popular because they were perceived as expanding coverage for no cost. In fact the major cost provisions didn't start until this year. Here is the breakdown of what it costs taxpayers.

According to HHS Secretary Burwell through mid-October 404care.gov enrollment was at 7.1 million people. According to HHS, in June the average premium was $346 per month. Taxpayer subsidies pay $264 of the premium while the consumer pays the remaining $82.

• Taxpayer subsidies ($264 per enrolled)         $1,874,400,000
• Consumer payments ($82 per enrolled)            $582,200,000
• Total Premiums ($346 per enrolled)              $2,456,600,000

There are numerous taxes and fees such as the medical devices tax, the Boehner tax (tanning beds), and the hospital tax which consumers don't see. These started in the first four years of Obamacare and are indirectly impacting your premiums. However, the new taxes and fees starting in 2014 have a direct impact on premiums. These are measurable and have a direct impact on what you pay in premiums. Here is the breakdown of four taxes/fees and what they cost based on the enrollment figures from above:

• PCORI Fees ($2 PEPY)                                         $14,200,000
• Reinsurance Fees ($63 PEPY)                           $447,300,000
• Exchange User Fees (3.5% of premium)            $85,981,000
• Health Insurance Tax (2.4% of premium)         $58,958,400
• Total premiums paid to the government:        $606,439,400

[PEPY = Per Enrollee Per Year]

It's not rocket science to see that the government is taking in more than consumers are paying. It should also be eye opening to know that the government is taking in more of your premiums than insurance companies are retaining for administrative costs.

The next time supporters of the law claim big bad insurance companies are raking in huge profits it would be good to remember that if we really wanted lower premiums the best way to do it is remove government bureaucracy from the equation.

O'Care Potpourri

■ In keeping with the politically correct stance of providing vital services convenience items for women, but not for men, Medical Mutual has announced that "Drugs Used to Treat Erectile Dysfunction No Longer Covered in Individual and Small Group Metal-Tier Plans (On or Off Exchange)."

That little blue (?) pill is now excluded.

#waronmen

■ We've talked before about some of the shadier links that are floating around, ostensibly to direct folks to the official 404Care.gov site, but actually not. Got this one in email today:

"Sign up For health-insurance Under the affordable Care - act-  avoid Penalties"

And then this link:

hXXp://www.XXX.co.at/l/lt7F19079Q1237AD/1245E7599IG115271HC229CT146978585H2202568847

Which does not in fact, lead to the real site at all.

Shocking, I know.

■ As we've been saying for quite a while, the whole "Navigator" idea is dangerously attractive to ill-intentioned folks. After all, they're (largely) unlicensed and unvetted, and, well, this will surely come as no surprise to IB regulars:

"A terrorist from Jordan briefly worked as an Obamacare navigator in Illinois while authorities remained unaware of her conviction for involvement in a deadly grocery store bombing and two other attacks."

But what could possibly go wrong?

Bastiat & Graboyes: The Legend Continues

Frédéric Bastiat, a noted 19th-century polemicist, is most widely-known for the Parable of the Broken Window (widely regarded as the underlying reason for New York Mayor Rudy Giuliani's successful cleaning up of Times Square, for example).

In the grand tradition of the forward-thinking, our good friend Bob Graboyes (Mercatus Center senior research fellow) has just been awarded the prestigious Bastiat Prize for Journalism by Reason magazine.

A heart-felt Mazel Tov to Bob!

Not Ready for (Sub-)Prime Time

So I spent a great deal of yesterday afternoon on the phone with the friendly - if hapless - folks at 404Care.gov. Turns out, one of my "Grandmothered" Anthem clients may be eligible for a subsidy, which means the (dreaded) Marketplace. We'd already picked out a plan, now we needed to enroll her.

Since her December renewal triggers a Special Open Enrollment, we were looking for a December 1 effective date. She's actually pretty fortunate: as I explained to her, it's not yet Open Enrollment season (that starts this coming Saturday), so there were likely only hundreds, perhaps thousands of folks vying for coverage at any given time today. Come the weekend, and especially next Monday, that will swell into the millions.

And yet, well, what you see at the top of this post is what we encountered multiple times. So we took their advice and called the toll-free number.

And spent the next two hours (really!) speaking with a delightful young lady named Destiny (last name withheld because she isn't the problem). Like us, she was unable to successfully access the system; in fact, she had to ask for my client's information several times as the system gobbled it up and spat out error message after error message. If it spat out anything at all (she was experiencing more hang-time than Michael Jordan).

Ultimately, we had to bag it (my client had another appointment, as did I) and we'll pick up again in the morning. We did ask Destiny if there was a better time to call, and she assured us that the call center is open 24/7, and one time's as good useless as any other.

And remember: this is the off season - still think they'll be up for the real deal?

I'll let you know how it goes today...

Great Expectations

It appears that Exchange enrollment for Obamacare isn't going to be what it was cracked up to be.

Back in 2011 CMS released released their summary forcast showing that in 2014 exchanges were expected to enroll 13.9 million. For 2015 that number was 15.9 million. Now comes word from HHS that actual enrollment as of mid-October there are 7.1 million people enrolled and that they are lowering expectations in 2015 to between 9 and 9.9 million. Why? Because they want it to be "accurate...analytically based."

I always thought meteorologists had the best job security. They could be wrong half the time and we forgive them. Now I'm thinking the best job is forecasting for Obamacare. When HHS/CMS make a mistake they simply "downgrade" expectations. Only in this situation we shouldn't forgive them.

Obamacare Moments of Honesty

Rep. Pelosi infamously said "We had to pass the bill in order to know what was in it".

Now the truth serum is administered to Jonathon Gruber and listen to what he says.

In case you missed it, “And basically, call it the stupidity of the American voter or whatever, but basically that was really, really critical for the thing to pass.”

Yeah, right.

To quote former Sec. of State Clinton, "What difference, at this time, does it make?".

Indeed ................

Obamacare Architect: "Call it the Stupidity of the American Voter"

Jonathan Gruber...watch the video.

Nuff said.

Breaking: SCOTUS to hear King

The Supreme Court has just agreed to hear arguments on whether or not folks in states with Federally-run Exchanges are eligible for subsidies.

Hunh.

Cavalcade of Risk #221: Call for submissions

Claire Wilkinson hosts next week's edition. Entries are due by Monday (the 10th).

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.

Health Wonk Review: Post-election edition

Jennifer Salopek at Wing of Zock (which, BTW, would make a great name for a band) hosts this week's round-up of wonky posts, with special focus on the future of O'Care in this new era.

Republicans Fix Obamacare?

If Republicans are going to degrade and destroy Obamacare they better bring their "A" game to the table. The ideas put forth in The New Republic are obviously from the J.V. team.

Consider this:

According to some, repealing the individual mandate (to buy health insurance) is number one on their agenda.

Certainly the most unpopular of the Obamacare provisions, but also the glue that makes it work.

Without a mandate you can expect carriers to take their ball and bat and go home.

The business mandate is also on the chopping block.

The employer mandate is a requirement that all companies with more than 50, full-time employees provide affordable insurance or pay a fine. It also defines “full-time” as at least 30 hours a week. The law’s critics say that has encouraged businesses to reduce the hours of some employees, in order to prevent them from hitting the 30-hour threshold and thus triggering the penalty.

The employer mandate has been, and will continue to be, a jobs killer. Eliminating the mandate is good, but exempting business from all Obamacare provisions is even better.

Employees have already seen undesirable benefit changes and unwanted premium increases as a result of Obamacare. There is nothing affordable about the "Affordable Care Act" and this extends to group plans as well as individual coverage.

The so-called insurance company "bail out" is viewed by some as unfair. This government reinsurance program is one of the main reasons why carriers agreed to come to the Obamacare Ball.

Protection against losses put them in the game. Taking it away will collapse the system.

Don't get me wrong, I never was an advocate of the risk corridor coverage. The reinsurance is scheduled to go away in a few years any way. Accelerating the removal is also accelerating the financial collapse of the Obamacare house of cards.

Add more metal plans.

Insurance available through the new insurance marketplaces must fit into one of four “metal” levels—platinum, gold, silver, and bronze. Platinum are the most generous plans: They would cover about 90 percent of the typical person’s medical bills. Bronze cover 60 percent. Critics of the Affordable Care Act say that the law forces some people to get more insurance than they want. They’d like to introduce a new metal level—copper plans, which would cover about 50 percent of the typical person’s medical bills.

The people that want to add copper plans must clearly have a cranial - rectal inversion. Throwing a (slightly) lower premium plan into the mix won't help anything.

Many of the so-called Essential Health Benefits are viewed by many as forcing them to buy coverage they don't want. This is especially true when you tell a 60 year old woman her new Obamacare plan includes free birth control and a maternity benefit.

But the EHB's have minimal impact on the new cost of health insurance.

Guaranteed issue requirements, telling carriers they must issue a policy to anyone, regardless of pre-existing medical conditions, drives up the cost more than anything else.

This is followed closely by community rating and age banding.

If Congress wants to make Obamacare more workable, they'll need to return to a market-based insurance product, probably with simplified underwriting, and coupled with a national risk pool.

Get rid of all mandates, including the MLR, and allow carriers to operate in a free market.

Anything else will just make things worse than they are now.


#repealobamacare

Have ObamaCare, Will Travel (With a Twist)

Tired of reading all those sob stories about folks losing their health insurance? Ready for some good news for a change?

Well, you're in luck:

"According to the Department of Health and Human Services, foreign diplomats... are eligible to participate in an array of medical programs administered by the federal government, including participation in Health Insurance Marketplaces."

WooHoo!

And all you middle-class whiners who make too much for a subsidy will be glad to know that at least someone's making out like a bandit:

"[A] foreign diplomat could satisfy the statutory criteria to be eligible for a premium tax credit and cost-sharing reductions.”

Isn't that great? Who wouldn't want to make sure that foreign visitors here enjoy the same a better level of benefits and access to health care than we simple proles do?

Don't be a hater.

[Hat Tip: FoIB Holly R]

Rubber, Road and Lyft: Insurance Crisis? [UPDATED]

If memory serves, we first addressed the insurance challenges of ride sharing some 3½ years ago:

"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."

At the time, we noted that hiring out your vehicle, or offering rides therein, made you a commercial insurance risk, and that personal auto policies explicitly exclude this from coverage. Fast forward a bit to this past Spring, and we restated the problem in the age of Uber and Lyft:

"The Nebraska Departments of Insurance and Motor Vehicles are urging caution before people sign up for Internet services that connect drivers, riders and vehicle owners for car-sharing and ride-sharing."

Again, the problem is whether or not one's policy allows for commercial use, and whether or not one had alerted one's carrier to the change (and obtained appropriate cover).

The challenge takes on a new urgency today:

"A spokeswoman for rideshare service Lyft says one of its drivers was involved in a multi-car crash in Northern California that left a man dead"

It appears that the Lyft driver was at fault (swerving to avoid a broken down vehicle), so the question arises: did he have appropriate insurance? We don't know, but one suspects that we'll soon find out. In the meantime, I've reached out to our favorite P&C guru for his thoughts.

Stay tuned....

UPDATE: Thanks to Kevin Sullivan, we have a bit more on this developing story:

"While a driver is providing a ride or on the way to pick up a passenger, Lyft offers $1 million in liability insurance, and $1 million in uninsured/underinsured motorist coverage. That coverage, which once was “excess” — kicking in only after a driver’s personal auto policy had been exhausted — became primary coverage in July."

Here's why this is important: it's possible (perhaps likely) that the underlying coverage - that is, the driver's insurance - will not cover this event. That being the case, it couldn't be "exhausted" and therefore Lyft's plan might not come into play at all.

Since Lyft's policy is now considered primary it shouldn't matter whether or not the driver's insurance steps up.

Time will tell.

Renewals vs "Grandma"

A couple of weeks ago, Anthem sent me a list of my clients whose plans renew this December. These are so-called "grandmothered" plans, but because Anthem chose not to participate in the expanded transition program, no changes can be made to them: my clients' only choice is to keep them or ditch them.

So I put together a brief (but informative) email explaining this, and sent it to the folks to whom it applied:

"Good morning!

As you know, there have been (and continue to be) a lot of changes with health insurance. Your current Anthem plan is "grandmothered;" that is, you may keep it as-is, or we can shop it around.

Your current rate is: $xxx
Your December renewal rate: $xxx

Based on recent experience, don't expect great results from shopping for a new plan (sorry!): your current plan doesn't meet all of the new ACA mandated requirements, but a new plan would (and I'm seeing some pretty horrendous rates on those). If you're interested in checking that out, here's a link to our (private) Exchange - it does NOT go to the .gov site:

[link]

There, you can see if you're eligible for a subsidy and get quotes for different plans. Of course, I'm always happy to run those for you if you'd prefer (or even just walk you through).

Thank you so much for the opportunity to be of service!"

As you might imagine, I've had quite a few replies: folks are generally pleased to have been kept in the loop, and most have asked me to see what else is available. Curiously, only one or two seem to be eligible for a subsidy, but we can't get those rates yet.

In the meantime, we started ...

Wait, what do you mean "we can't get those rates yet?" It's less than two weeks until Open Enrollment starts, and the carriers haven't figured out what they're going to charge? How can that be?

Have you not been paying attention? We reported a month ago that carriers were enjoined by Our Betters in DC© from disclosing Exchange-related testing results, which of course would include details such as rates. Makes sense, really: after all, we have to hide the site in order to learn what's in it.

Right?

As I was saying, I began running quotes for my December renewals, and (as expected) they weren't pretty. By way of example:

Client 1 - HSA plan, current rate $241, renewal rate $276, comparable ACA-compliant plan $540

Client 2 - HSA plan, current rate $355, renewal rate $432, comparable ACA-compliant plan $1,020

[ed: Almost all my clients are in HSA-compliant plans. Funny, that]

The point is, there don't seem to be any attractive options for these folks; their best bet is to stay put, at least for the nonce. I'll add that I see no reason to be optimistic about the January 1 rates - when they're finally released.

Hoosier Health Insurance Goes Bye-Bye

Looks like 30,000 Hoosiers really hate their current insurance. After all, the Precedent explicitly promised them that if they liked their plan, they could keep it:

"Notifications have been sent out to 30,000 residents of Indiana informing them their health insurance plans no longer meet the requirements of the Affordable Care Act, also known as Obamacare, and will be cancelled at the end of this year."

Easy come, easy go...

The $958 Fallacy

Randy Essex, editor of the Glenwood Springs (Colorado) Post Independent, has an interesting, if disingenuous, article on a recent health care claim. Briefly, he underwent what he called "routine blood tests" that had previously cost him $45, and for which he was recently dinged $958.

He then proceeds to complain about transparency, pricing and claims, without ever actually demonstrating any knowledge of what actually happened.

So let's deconstruct this for him, shall we?

By his own admission, his previous tests cost him $45 because he had a (presumably generic) co-pay plan. Of course, the tests cost much more than $45, and he pre-paid the balance with inflated premiums (versus a catastrophic, HSA-compliant plan).

Flash forward a few months, and he has a new (catastrophic, presumably HSA-compatible) health insurance plan. As an aside, he laments that he was a victim here: "The only thing that had changed was my insurance, which, like so many other workers’ plans in America, had been switched by my employer to a high-deductible policy."

Here's a new flash, Randy: your employer can't require you to sign up for his group plan. You could always say "no, thanks." Look for that option to go away, though, as employers dump their employees onto the Exchanges.

But I digress.

Next, Randy admits to a very stupid choice: "the doctor wanted to put me on Lipitor, and I acceded. I hated it and stopped." This is called "self-medicating" and is generally a very stupid idea. At the very least, you should discuss this in advance with your physician (for whose services you've paid, by the way).

He goes on to detail his most recent encounter, and it's here that things begin to go sideways quickly:

First, he laments that he needs "to be able to see the prices without spending hours on the phone." Most carriers have made this information available for years (heck, we first wrote about it almost exactly 9 years ago!). Then he "assumed this was a preventive, covered procedure meant to help lower my risk of heart disease" (emphasis added: we all know what happens when we assume). Rather than assume, why wouldn't you ask the purpose, and then check to make sure? Based solely on the article, it sure seems to me that this was diagnostic, not preventive, and thus subject to the deductible.

Generally speaking, even diagnostic items would be eligible for in-network pricing, but that appears not to have been the case here:

"The bill also showed an insurance adjustment that lowered my cost by $1. One. Dollar." After speaking with the plan administrators, he was assured that this was a mistake and that it would be corrected, but that seems not to have happened. Rather than pursue a solution with the insurer, though, he indicts "the clearly ridiculous cost, the complete lack of transparency in medical prices and the lack of any real consumer choice."

Really, Randy? I don't think so: you have no idea what drives those "ridiculous costs," such as malpractice and other liability insurance, lab fees, the actual costs to run the various tests, and of course the experts to analyze the results. The lack of transparency is on you: why didn't you check the carrier's site, or ask the tech? Most likely he (or she) wouldn't know, but could direct you to someone who did. And finally, you had your choice of any number of facilities where this work could be done (Google and/or your carrier's site come to mind).

No, it's much easier to blame others for your own lack of foresight. On the flip side, congrats on your lower lipid level.

[Hat Tip: FoIB Holly R]