A Beneficial Conundrum

Well, actually a Beneficiary poser: Long time life insurance client needs to change/update his beneficiaries, which is normally the most mundane thing we do (other than maybe address changes). But, there a twist: he has four (4!) primaries listed, including a trust for one of his adult children.

Of note: my client named zero (0) contingent beneficiaries. Typically, these are folks "second in line" in case the primary predeceases the insured. Not required, or even typically critical, but kinda comes into play here.

Okay, so far not really a big deal, but then he throws me a curve-ball:

"Question, in the unfortunate event that [spouse] and I should pass away together, would her portion automatically go to [son]? How does that work and how do I make sure there is some sort of waterfall to protect my money and those beneficiaries I have listed?"

Hunh.

So, I had a thought, but really not very certain of its validity. So I reached out to our carrier rep, who also had an opinion, but wasn' very confient oin that, either. ZSo, he bumpled it up to the Vice President of Claims, who (very) helpfully replied:

"The rules vary by state and are usually called the Simultaneous Death Act (or similar).

In Ohio, the statute says this:

Except as provided in section 2105.36 of the Revised Code, an individual who is not established by clear and convincing evidence to have survived an event by one hundred twenty hours is deemed to have predeceased the event for purposes of a provision of a governing instrument that relates to the individual surviving an event, including the death of another individual.

So, what that means is that, if the husband and wife die in the same accident, then it would be assumed that the insured died first, unless there is clear and convincing evidence that the beneficiary survived for 120 hours after the accident.   The contingent beneficiary would receive the proceeds.  If no contingent, then it would go to the policyowner’s estate.

If the spouses die two days apart, then it would still be the same scenario, since the beneficiary did not survive for 120 hours.  If it is six days apart, and we have clear and convincing evidence of such, then the proceeds would go to the Estate of the beneficiary, because they survived the insured by more than 120 hours."

Hunh!

So the bottom line is that, if they're both hit by a bus and die simultabeously, the wife's portion of the policy would be paid into my client's estate. Which is I think what he was trying to ascertain.

Regarldess, I was told that the carrier would even be using this as part of a training module. Cool beans!

Also, #LearnedSomethingNew.

[Hat Tip: FoIB Brian D]

Re-thinking transparency

We first blogged on transparency in health care pricing and consumer-centric health care in 2005:

"One of these tools is the pilot transparency program."

So yes, we've long been advocates of what I called the McDonald's Model:

[click to pic to embiggen]

But FoIB Bob Graboyes of the Mercatus Institute offers a contrarian's take:

HEALTHCARE TRANSPARENCY MANDATES — FIRST, DO NO HARM: Op-ed on a point that Jessie McBirney and made in a recent @mercatus paper: why broad-brush healthcare price transparency mandates can paradoxically REDUCE competition and INCREASE prices. https://t.co/o2X1YoAYoQ

— Robert Graboyes (@Robert_Graboyes) August 31, 2020

Interesting.

Teacher's Pet?

This isn't necessarily huge, but it was kinda heartwarming:

Earlier this week, got a call from a nice lady, referred to me by another client (always a nice warm fuzzy), who had a dilemna:

She had just retired from teaching, and was trying to decide between taking the State Teacher's Retirement (STRS) health insurance plan, which was quite extensive, and quite expensive or opting for a short term plan (she wasn't interested in even discussing an ACA-compliant plan). Better still, she had to decide literally that day, because she had to let the STRS folks know by the following morning.

And yeah, I wondered why she'd let such a potentially financially impactful decision go 'til the last last minute, but I could sense the distress in her voice, so I simply said:

"Look, if you can swing the STRS premium for a month or two, then pull that trigger. Doesn't mean you're married to it, just gives us space to find other alternatives."

I could literally hear the sigh of relief as she took that in. She thanked me profusely, and said she'd be in touch.

I really like my job, and sometimes I really love it.

Spoiled baby food

This in from FoIB Jeff M:

"The [North Carolina insurance] department says an examination of 300 claims from over seven years revealed many violations with Gerber Life’s accidental death and dismemberment policies."

Ooops!

The carrier, primarily known for its "$1 for the first 6 months" juvenile life insurance plans, has been ordered to pay over $3.5 million in fines, recoveries and interest.

Not a good look there, folks.

Interesting HSA query

Recently, one of my clients had occasion to interview a potential new hire, and to explain how their benefits include both an HSA-compliant health insurance plan and that the employer contributed a non-trivial amount into it.

The potential new hire replied that he was a big believer in HSA's, and already had an established one. My client reached out to me to see if that would pose any issues.

I, of course, reached out to our gurus at FlexBank/Navia, who replied:

"As long as he hasn’t fully contributed, the employer can contribute into his already established HSA."

Nice!

Fom the P&C Files: Flo meets Darth

 

Medical Kidnapping. Wait. What?

You may have read about a young teenager named Justina Pelletier, from West Hartford, CT. In 2013 Justina was kidnapped by a hospital where she had been admitted for treatment.   Her kidnapping and other similar incidents have given rise to the term "medical kidnapping".  Medical Kidnapping is a growing phenomenon that bears watching.  

I think there is not a more accurate term for what happened to Justina Pelletier than kidnap.  Justina’s ordeal, and that of her family, is described here and here.  Her story is worth reading.  Fair warning:  The story will upset you, especially if you are a parent or a medical care professional

 

The accounts are comprehensive so I’ll add only the following observations of my own. 

 

 (a)  the core issue in the Pelletier case seems to be a scientific and clinical fight about whether mitochondrial disease is actually a physical ailment or primarily psychological.   This type of issue may be present in other cases where there is overlap between the physical and the psychological. Connection with insurance = Do insurers consider a diagnosis of mitochondrial disease consistently as either medical or psychological? 

 

(b)  It is clear that cases of Medical Kidnapping are on the rise. See here and here and here and here.   You can search for yourself by entering Medical Kidnapping and just start reading 

 

 Connection with insurance = How might insurance for mitochondrial disease change as the incidence of the disease rises?  

(c)  Justina’s parents sued Boston Children’s Hospital charging medical malpractice.  Nearly 7 years after Justina’s 2013 admission to BCH, a jury took fewer than 6 hours find BCH not guilty.

Connection to insurance = How might hospital and professional liability insurance coverage/ limits  be affected as the incidence of this diagnosis continues to rise?  

(d)  I have been unable to find any account of specific reasons behind the jury verdict.  For whatever reasons, the jury believed the hospital not the parents.  But consider.  Boston Children’s Hospital is widely thought to be America’s #1 pediatric hospital.  Its teaching affiliate is Harvard Medical School. BCH is also a primary source of professional expertise in child abuse cases before the Massachusetts Department of Children and Families.  No doubt there are many strong ties among BCH officials and physicians; influential Harvard officials and alumni; and DCF officials regarding medical care, politics and even the courts. Especially in Boston.  The influence of these ties naturally extends over the general public, from which jury members are selected.  One can appreciate how difficult it is for anyone not inside that circle of influence, to prevail when taking action against it.

I suppose a teaching hospital anywhere has similarly widespread influence within its community and can be similarly immunized from scrutiny and full accountability - as appears true regarding BCH and the Justina Pelletier experience.  

 

Connection to insurance = Same as in (c).

 

(e)  Aside from medical and insurance issues, the growing number of medical kidnap cases is a social problem, increasingly encountered in the care of minor children.  The Pelletier case illustrates the kinds of problems encountered.  Here are a few that stand out to me, there must be others:

 

1.  Significant differences of opinion among physicians treating minor children

2.  Scientific disagreement over the nature of some condition(s) affecting minor children

3.  Legislative flaws e.g., do States' children & family services bureaucracies abuse their authority? 

4.  Inadequate consultation among attending physicians

5.  Inconsistencies among insurers over terms of coverage for medical & legal liabilities

6.  HIPAA protections of minor children’s patient privacy can be used to keep parents from knowing what treatment their minor children are receiving.  This can effectively remove parents from participation in decisions involving their own minor children’s care.  

7.  Growing influence of the regulatory state, in which persons accused of regulatory violations are presumed guilty, and have the burden of proving themselves innocent.  This negates the presumption of innocence historically imbedded in our legal system.

P&C Files Bleg: COVID vs Football

 I'd be very interested if one of our readers has the inside scoop:

If you know a casualty actuary, pass this along. I’d love to hear their thoughts on this perspective. https://t.co/qTUg0KjGQ3

— Greg Fann (@greg_fann) August 12, 2020

Thanks!

Tell us again about "Affordability"

 So this pops up:

ACA Affordability Threshold for 2021 Announced https://t.co/UEO6O9t0EM

— Healthcare Reform (@Health_Reforms) August 11, 2020

The article to which that refers explains:

"In order to avoid triggering a penalty ... an applicable large employer must offer full-time employees health plan coverage that provides minimum value and is affordable."

Of course, the gummint's definition of "large employer" is somewhat .... perplexing:

"... if you employ more than 49 people, you've either got to offer (and help pay for) a group plan or pay a penalty tax."

In this case, the income test - "affordable" - for next year is just shy of 10% of one's income. And keep in mind, that's just counting the premiums, not the thousands (or, commonly, tens of thousands of dollars in potential out-of-pocket costs).

Pretty bizarre definition of "affordable," no?

Monday Linkage

■ First up, interesting product news from Anthem:

"Beginning January 1, 2021, for new and renewing business, your clients will receive affordable access to groundbreaking gene replacement therapies through our new benefit protection program, Anthem Gene Therapy Solutions."

That's the good news. The catch?

"The program will be embedded in Large Group administrative services only (ASO) plans with 51 or more eligible employees (CA & CO 101+) ... New York is excluded from this program
offering."

So if you're a small group anywhere in the US, or any group in New York, no soup for you.

■ Next, another in our seemingly endless series of Business Interruption vs The 'Rona" posts:

"Legal experts Glenn Jacobsen and Mark Binsky examined the Houston Rockets lawsuit and expressed doubt that the suit would be viable or eventually prevail at trial ."

The issue is that the team's games were suspended by the NBA, and thee was no actual physical damage that would net a successful claim.

■ And last (but most assuredly not least), this:

U.S. residents under age 45 spent July shopping for life insurance as if it were a hot new phone, or hand sanitizer. Consumers in that age group filed close to 20% more life applications last month than they did in July 2019, according to MIB Group.https://t.co/zFVFypqgij

— ThinkAdv Life/Health (@TA_LifeHealth) August 10, 2020

Not-So-Intransigent Providers: An Update

The other day we posted about what appeared to be a rather unfortunate problem for one of my clients:

"Dr. [redacted - for now] is in our system under 2 separate Tax ID’s. Only one is actually in our network, and the location the patient's supposed to go to isn't."

So, I reached out to co-blogger (and certified medical office manager) Kelley B, who reached out to the doc's practice manager, who shed a great deal of light on the matter:

"We reached out to the patient to explain that [the doctor] is not in network through our practice.

There was a renal physician who passed away suddenly earlier this year in a different practice. [Our doctor] is also a nephrologist and offered to help them a little while they got their staffing situated.

[Our doctor] is in-network through them for this plan as a nephrologist not an endocrinologist."

Ah-hah!

At about the same time, I got an email from the practice's Accounts Manager, who added that they had long ago decided - as have *many* providers - to forego contracting with ACA-plan networks, and aren't presently interested in reconsidering that decision. And of course she (and the aforementioned practice manager) stressed that since my client would be out-of-network she was on her own (which we already knew).

She also mentioned something that my client and I had discussed: that she'll want to be careful about any lab work that might be ordered, in case that becomes a network issue, too.

One bright spot: the plan is HSA-compliant, and she has socked away a few shekels into it, so she can use some of those to pay for the visit (and, if necessary, lab work). Oh, and I suggested that she ask the practice if there's a discount for paying cash (never hurts to ask).

So, mystery solved, just not a very satisfying answer.

By the way, there are some great comments on that original post, worth going back and reading.

[Special Thanks to co-blogger Kelley B, as well as the folks from the doc's practice]

From the P&C Files: D&O insurance heads' up

It's been a while since we've blogged on Directors and Officers (D&O) liability coverage, and both of those times had to do with churches. But D&O coverage is for pretty much any business or charitable enterprise with boards of directors (or elders, or council members, etc), among others. And just what is this type of policy?

Well:

"Think of D&O insurance as coverage for management decisions ... Who makes the decisions? That’s who needs protection."

That's from a recent post over at the Cincinnati Insurance Company's blog, and it's really quite interesting. As the author notes, many organizations, and especially small businesses, hear the term and automatically (and erroneously!) presume it refers exclusively to organizations with a  "Board of Directors," which, if you're a sole prop or very small business, you don't have. But turns out that that kind of thinking can get a small business in a heap o'trouble:

"Anyone who believes they have been harmed by the actions of a company can take legal action against the company and its decision makers."

And who might comprise this list of possible litigators?

That would be folks as diverse as vendors and suppliers, customers, even competitors (and the list goes on).

Absent this coverage, a small business owner (or owners) could be left with some pretty big expenses, even if they prevail at trial.

How's that?

Well, attorney's aren't free, and they aren't cheap (well, you do get what you pay for, one supposes). And those legal costs are going to be out-of-pocket without proper coverage in place, including D&O.

So if you're a small business owner, make sure you discuss this with your agent. It could save you a major headache (and wallet drain) down the road.

[Hat Tip: FoIB Deb C]

Intransigent Providers

So I have a client that has some health issues, and who has an ACA plan (not mentioning the carrier because they're not necessarily in the wrong here). My client, we'll call her Sally, has a specific, chronic health condition that requires the care of an endocrinologist. Unfortunately, there haven't been any in-network endo doc's nearby, and because it's an ACA plan, out-of-network means out-of-luck.

Fortunately, one such doc has recently been added to the network, and Sally quickly made an appointment to go see her. The rub is that she apparently has two offices (or not, depending on whom you ask - more on this in a moment), and only one is in-network. The problem is that she doesn't actually have an office at Location #2, and apparently never has. But according to the carrier:

"Dr. [redacted - for now] is in our system under 2 separate Tax ID’s. Only one is actually in our network, and the location the patient's supposed to go to isn't. We've reached out to the provider to confirm."

Rock and a hard place, indeed, since she doesn't seem to actually practice at Location #1.

So with Sally's blessing, I reached out to the billing folks at the doc's office. I told them that, although I'm happy to pay conduit, my word holds no sway, but that a letter from the doc confirming Location #1 and denying Location #2 would go a long way. The billing lady didn't seem too keen on that, explaining that she saw her job as keeping this kind of thing out of the doctor's way. I thought that this was an odd way of putting the patient's interest first, but she did agree to discuss the issue with her supervisor.

Oh goody.

She then questioned whether this was even a worthwhile exercise, since it was unlikely that the matter could be resolved in time for Sally's upcoming appointment. I pointed out that the longer they put off helping her the more likely such an outcome became.

She appeared unmoved.

So as it stands, the doc may or may not have an office at two locations, and may or may not actually practice at either one, and may or may not really care about her patient's well-being (both physical and financial).

Nice gig.

In any case, I'll keep this on the top of the pile. and hope for the best.

Travel Medical: A Perspective

Recently, a colleague referred one of his clients to me (a very wonderful compliment) for help with a travel medical plan for a visiting guest. He introduced the two of us via email, and the client called me shortly thereafter.

Turns out, this wasn't just any guest, but his son and granddaughter coming in from Europe for a two month stay in our lovely Buckeye State. He was concerned that there would be insurance in place if either were to become ill or injured. No problem, pretty standard, although currently kind of out of the ordinary. I was just glad to see that international travel wasn't completely dead.

In any case, the gentleman had been doing a lot of online research for this kind of plan and, in frustration, called his agent for hep, and thus the referral to me.

I do a fair amount of this kind of thing, so I was pretty familiar with what he needed. I answered his questions, and then got the information I needed to obtain a quote. For these kinds of plans, I pretty much exclusively use our friends at Global Underwriters, primarily because they know what they're doing and, as important, I have a long history with them so that I know I can count on them if any glitches develop. I'm sure that other vendors are also reliable, but I know that the GU folks are.

I also know that their plans and rates are competitive, and there won't be any surprises.

Okay Henry, we get it: you know and trust them, why are you beating this horse?

Well, the client also asked me about my relationship with his agent, and I explained that the gentleman and I are colleagues and that he has referred these types of cases to me in the past. He then said "well, [agent] always gives me several quotes, will you also be doing this?"

I immediately replied no, for the reasons stated above. He seemed satisfied with this, and I agreed to send him a quote ASAP. Which I did, but did not realize that I had forgotten to attach a summary of benefits, and he asked me for that. Of course I obliged.

I had now spent a total of almost an hour on the phone, obtaining and sending the quote, and sending the Summary of Benefits. All in a day's work, and happy to do so.

Now, my commission on this plan will be in the neighborhood of $35, not bad for an hour or so's work. And of course, I'm happy to assist a colleague. But would I be upset if the client ultimately chose to DIY? No, not really: disappointed, sure, but not upset. After all, it's his choice, no?

Oh what a tangled web

Our friend Jeff M sent along this (poorly written) article about the sometimes duplicitous world of reinsurance:

"A businessman and political donor ... has been sued by Universal Life Insurance Company (ULICO) over a personal guaranty Lindberg made to back PB Life and Annuity Company."

It appears that the companies had come together to form a reinsurance agreement (this is essentially a contract that helps minimize risks that carriers take on, more here). and it seems that one of the parties has been ... negligent ... in holding up his end:

"ULICO alleged that PB Life was not in compliance with the reinsurance agreement because 65% of the investments of the trust fund were in loan obligations to affiliates of PB Life which exceeded the threshold of 10% established by the insurance code."

As FoIB (and extremely knowledgeable carrier rep) Brian D explains:

"This guy doesn’t stand a chance.  PB Life is out of compliance.  The worst part of this (agreed it’s a poorly written) story is what Lindberg’s connection is to PB Life and why he would ever personally guarantee a loan of that size.  Seems ridiculous.  But as a reinsurance entity, you cannot have 65% of your assets in loan obligations.  Not in this economy.  That is insane."

Oh, I think we can tell right away why Mr Lindberg agreed to underwrite this out of pocket.

Will be interesting to see how this plays out.

Stay tuned....

Time's running out: HRA edition

Our friends at FlexBank (now Flexbank/Navia) have a timely reminder for employers with Health Reimbursement Accounts (HRA's):

"Don't forget! The HRA PCORI fee is due by July 31, 2020"

As in: tomorrow.

This year's fee is about two-and-a-half bucks per participant, and it's due no later than tomorrow (July 31).

Oh, and just what is this fee?

"[T]he Patient-Centered Outcomes Research Institute, which "funds studies that can help patients and those who care for them make better-informed healthcare choices."

Okay, thanks for clearing that up.

Timing & LTCi

A few years back, I ran into a colleague at the grocery. She had recently been licensed to sell Long Term Care insurance, and wanted to "talk shop."

Okay, I’m all ears.

Turns out, she had been trained (??) to advise her clients to put off filing a claim for as long as possible, on the theory that using their own funds would allow the insurance dollars to last longer.

I nodded and said "well, that’s interesting," and we went our separate ways.

It was not, in fact, "interesting,” it was stupid.

Whoa there, Henry them's sharp words. Care to 'splain’ yourself?

Sure.

Last Fall, my mother-in-law was in a pretty nasty car wreck, and ended up in a very nice  Assisted Living facility. She had long ago bought a Long Term Care insurance policy through an affiliate program that her husband's employer offered. Since she had multiple physical issues as a result of the accident, she qualified for benefits under the policy, and they began rolling in a few months later.

Unfortunately, she passed away recently, which is what prompted this post.

The most important aspect of the claims issue is that we don't know how long that person will live, and had we listened to my colleague's advice, we may well have left significant "money on the table." Here's why:

She needed help with activities of daily living, and part of the claims process is an evaluation by a company representative (usually a nurse or service that they contract with) to make that assessment. If we had waited, there would have been no way for that evaluation to have taken place, and the claims process would have been very messy (or just straight-out declined). There was absolutely no upside to waiting, but significant potential (more likely, probable) downside.

Alternatively, had she been cleared for claims up-front and we had simply waited before filing the claim (which is another way to have interpreted my colleague's idea), we would not have been reimbursed until later. Yes, we would likely have still received the funds (this was a reimbursement-type plan) but why would we have given up the interest (this was a fairly decent amount)? After all, money is fungible, and using the carrier's funds instead of Mom's meant her money was able to keep earning interest.

Take heed.

COVID & BI: One more time...

We last discussed this issue a couple months ago:

"It's going to perhaps send a false sense of hope and promise to a community of folks who need action and relief now."

That was in response to a threat by DC Council-critters to force carriers to pay Business Overhead (BI) claims for quarantined businesses. Regular readers know that this coverage does not extend in that circumstance.

Fast forward a bit, and we get this in email:

"The ruling reaffirms that BI policies only cover physical damage."

That is, the closing of a business due solely to government mandate, with no actual physical loss, is not a covered BI expense.

This is important because it's one more nail in the proverbial BI/COVID coffin.

Click on through for the gory details.

Kind of Off-Topic, but...

This is pretty amazing:

"2nd baby is born from dead donor's transplanted womb at Cleveland Clinic"

Most of us are familiar with posthumous organ donation (heck, there's even a checkbox on drivers' licenses), but I daresay that likely includes corneas and kidneys, hearts and lungs, that kind of thing. I've even heard of harvesting sperm from a dying father.

But this one is new to me. And it gets even more interesting:

"It's the second child in the hospital system to be born from a dead donor's transplanted womb." [emphasis added]

Wow - And Mazel tov to Mom!

[Hat Tip: Holly R]

From the folks in DC

Comes this helpful video on how to report federal pandemic unemployment compensation. Although it's geared for agents, seems perfectly suitable (and informative) for consumers, as well:



In case you're debating whether or not to watch, the video covers how folks can:

• Update their income information due to unemployment
• Add in unemployment benefits to their income
• Determine what types of unemployment benefits should be counted as income
• Accurately estimate their yearly income

And heck, it's less than 6 minutes long.

The Kickstarter clock is ticking...

Just a few more days left for our friends at Fat Dragon Games' latest project.

For RPG fans and 3D printing aficionados.

Our good friends at Fat Dragon Games have launched their latest KickStarter, and it's a doozy:

"VALLIS MORTIS, the valley of the dead, is the campaign world created by Fat Dragon Games founder Tom Tullis over 35 years ago. Starting with this Kickstarter, and continuing with future campaigns, locations in this setting will be brought to life as richly detailed 3D printable models, and an accompanying campaign setting pdf will feature information on each location as it is released."

There are some incredible stretch rewards, lighted terrain options, and even detailed miniatures that rival the most intricate store-bought models.

And the world of 3D printing keeps getting more and more affordable, with decent printers starting at about $220.

So what are you waiting for?

This is Weird: Revisited

The other day, Hank posted on the difficulty he was having reconciling why a given person's group health insurance rate changed depending on whether they were the employee or the employee's spouse. That post, and some back-and-forth in the comments, sparked my curiosity. 

Hank said

"up until about age 40, the male spouse rate is actually lower than the male employee rate. And at age 35,female employees are actually more expensive than their(presumably) stay-at-home counterparts."

So I graphed the data based on the original post.

1.  Male employee vs male spouse
2.  Female employee vs female spouse

Graph #1 addresses the first reference above (click to enlarge):

The premium rates differ in specific amounts, but the differences are not material below age 50.  After age 50 the spouse rate rises above the employee rate.  This insurance company apparently has data that support the higher cost for older male spouses vs older male employees.  I’m guessing that older male spouses tend to have more health conditions that prevent them from working.  That would show up in the experience of the pool, and its effect would likely grow as the individuals age.

Graph #2 addresses the second reference:

The main difference in this graph vs. Graph #1, is seen in ages under 35.  My guess is that the female spouse rate is higher than the female employee rate through these younger ages because of marginally higher maternity liability.  That difference then closes rapidly.   After age 54 the female spouse again appears to be more costly.  Again, I don't dispute that the insurer’s cost data support the differences.  After taking maternity into account, the result observed in Graph #2 is consistent with the result observed in Graph #1.   It may well have the same origin i.e., that older female spouses tend to have more health conditions than older female employees, that prevent them from working.

Another possibility is that this insurance company’s pool includes marginally more male spouses who are employed (under age 50, anyway), and therefore represent a lesser liability to the female employee's plan because of COB (Coordination of Benefits).

Whatever, and aside from the actual dollars-and-cents differences in rates, the shapes of the lines on the graphs seem to me consistent.

I think the actuarial correspondent is correct about the beneficial effect of selection for employees vs spouses.  It’s visible in the premium rate relativities in all the other premium rate graphs I created.   I'm surprised he did not mention (or maybe he did?) the cost of maternity for younger females, regardless whether working or not.  That’s visible in the graphs, too.

In each of the questions you’ve raised, I’m not claiming I have a full explanation.  While I think my guesses may be a good part of the explanation, we’re still left with questions.

"We started with one question, and ended up with many questions."  One of my profs in college (philosophy, not mathematics) often made that remark at the end of his lectures - and then always concluded by saying "What a marvelous bargain!"    I still think that insight was worth the whole semester's tuition.  At least for his class.  (In 1965, the undergraduate tuition at my school for a 3-hour class was only about $150).

Which means - - this exercise was a bargain!

A Win for Private Medical Practices

The news for privately held medical practices of late has been bad. Revenue cuts from insurance companies, continuing competition from Hospital Based Groups, the continued selling of practices to Hospitals or simply closing business due to lack of funds.

Friday July 17, Private Practices were given a win by a federal appeals court:

“A federal appeals court ruled the federal government has the authority to cut Medicare payments to off-campus clinics to bring them in line with independent physician practices, reversing a lower court’s decision.
 

The goal of the rule is to reduce a disparity in Medicare payments where hospital-affiliated clinics get paid more than physician offices for the same services. Some critics have said the gap has helped fuel a race towards hospital-physician consolidation.”

So dear readers, this does sound confusing. If you are a provider practicing in the same locality, doing the same work, and billing the same CPT codes to Medicare, why are Hospital-owned providers paid more than non-hospital (private) providers? The answer lies in the place of service:

When a provider bills for your appointment, there are several key pieces of information sent to your insurance carrier so that they'll know both what happened and how to pay. One of those pieces of information is the 'place of service' code. This code lets the insurance carrier know if the facility is an office, a hospital, an ASC (Ambulatory Service Center), or a myriad of other facilities where medical care is rendered. Depending on the place of service, the payment for the same procedure can be more than the standard payment. Hospitals are one facility where the payment is higher.

This affected private practice owners because hospital-owned providers, who worked in a hospital or in a Medical Building next to the hospital, billed the facility code as a hospital instead of as an office. Thus, hospital-owned providers would receive higher compensation for an office visit than would a private practice provider.

So in the end, is this a turnaround for private practices or a little too little, a little too late?

Math is hard

Especially in these difficult times. On the plus side, I recently received this news in email from the Feds:

"Helping consumers calculate their income can be challenging, especially for those who are self-employed or have income that is difficult to predict. The Centers for Medicare & Medicaid Services (CMS) has released a new tool to make this process easier!

The new income calculation tool allows consumers to add previous income, unemployment benefits (including federal pandemic unemployment compensation), and expected future income to calculate their income."

They've even supplied a helpful video:



Feeling frisky? Well then, click here to test drive the new tool itself.

So this is weird

Working on a new group quote, finally noticed something I suppose I've know all along, but just never 'paid any attention to.

Take a look:

[click to embiggen]

It's never really "clicked" for me until the other day that at any given age, the rates are different for employees versus spouses. That is, a male employee's rate is always different than that same age male spouse, and same for females.

Why?

After all, that person is the same risk regardless of whether he or she is the employee or the spouse. Or is he (or she)?

So I reached out to FoIB (and actuary) Gregg Fann for his insights, and he replied that it likely has to do with the "actively at work" clause in group plans. That is, dependents (spouses) aren't necessarily that healthy.

And I can see that, but it still doesn't wash, because, well, up until about age 40, the male spouse rate is actually lower than the male employee rate. And at age 35, female employees are actually more expensive than their m(presumably) stay-at-home counterparts.

I realize that in the grand scheme of things this is really not a huge deal, but it's been bugging me for a few days now: why the difference?

Any thoughts on this?

Another great idea

This reminds me somewhat of the Sesamecare site which "takes the reduced-fee, cash only model and expands it to include primary care and dental visits, eye exams and MRIs, and other services." So there's precedence:

"I’m building a network of cash friendly medical providers in the DC Metro area."

This is from FoIB Sheron Sidbury, an agent in Virginia, who's expanding her menu of client services in a very meaningful way. She's taken a clue from our friends in the DPC and cash-provider worlds, and then gone a step further:

"[M]y goal is to help people in our local area find cash pay and other non-insurance methods to take care of their healthcare needs."

I love this.

Why?

Well, as we've noted ad nauseum, coverage ≠ care, and with today's emphasis on both higher deductibles and health care pricing transparency, this seems like a wonderful opportunity to help her clients. This effort is still in the embryonic stages, but I expect that it will grow quickly as more and more providers learn about it and hop aboard. Hopefully, this can continue to expand to other markets, as well.

So, fingers crossed hopefully.

Rx for Shanda

Shanda being Yiddish for scandal. And boy, this one appears to be a doozy:

Express Scripts "egregiously charged for services it didn't deliver," that has cost Ohioans millions. " We want our money back," says @OhioAG Dave Yost. https://t.co/AYFF0UnCQn via @healthcaredive

— AssocAmerPhys&Surg (@AAPSonline) July 15, 2020

At the linked story we learn that the vendor (allegedly) overcharged The Buckeye State's Highway Patrol Retirement System. Looks like they're going to be getting quite the ticket.

Express Scripts is a Pharmacy Benefits Manager (PBM); we've written about these before:

"PBM's are (allegedly) a cost-efficient way for carriers to offload the administrative functions of filling prescriptions."

But wait, there's more:

"While the concept seems innocuous enough, it's apparently become a major source of tension in the health care community, and is frequently cited as a major driver of increasing health care costs."

Oh.

Timing is Everything (Still!)

Working on an interesting case, and thought readers would be, um, interested:

Sally called yesterday about individual medical insurance. Her husband had retired and is on Medicare, she still has a couple years to go until she's 65. In the meantime, her COBRA plan is due to run out in November, and she's trying to figure out her options.

There are a bunch of issues here, and we discussed them at length (she's my favorite kind of client, interested and engaged, asking really good, helpful questions). I'll cover just a few of them in this post.

First is timing: if she rides out her COBRA until November she's going to end up squarely in "regular" Open Enrollment Season at the very same time that she's eligible for her own Special Enrollment opportunity. Which means she'll be shopping for a 2-month-long 2020 ACA plan (if she goes that route) and a 2021 version. Which also means that she's going to have 3 annual deductibles in about 60 days (2020 COBRA, 2020 ACA, and 2021 ACA). Not a great place to be, but as I explained to her, pretty common when we're looking at plans this late in the year.

It turns out that she's met very little of her 2020 COBRA deductible, so she might be better served cancelling that sooner rather than later; that way, any expenses that crop up would go towards the 2020 ACA (or other) plan. On the other hand, her COBRA plan is pretty decent, and is a PPO, unlike current ACA plans that are built on the HMO model with pretty much in-network coverage only.

Another option we're exploring is a Short Term Medical plan, which offers better coverage and lower rates than ACA plans, but are underwritten and don't cover pre-existing conditions. That latter isn't really a problem, she's in good health now, but some years ago she had a cancer scare, and we're looking to see if that's going to rule out the STM option.

This is the kind of case I most enjoy: challenging issues, an attentive, engaged client, and the opportunity to look at some outside-the-bun options.

Grateful!

CV-19 Claims Another

If you've ever bought a life insurance policy, you've probably (although not necessarily) had what we in the biz call a paramed exam. These usually consist of a nurse (or NP, etc) who takes your pulse, height, weight and samples of various bodily fluids, and then transmits these to the carrier. It's not really a big deal, but on any given day thousands (hundreds of thousands?) of folks undergo this process.

One of the more successful such vendors is - was - EMSI. I say 'was' because, well:

"COVID-19 has disrupted families, communities and businesses ... As a result, all company operations ceased on Friday July 3, 2020."

Yikes.

So what does this mean to the average person? Well, unless you were an employee or recently applied for life insurance, not much. If the latter, then expect to see underwriting delays while the carriers sort this out. I understand that at least one major company expects this to add at least two more weeks to the underwriting process.

Co-blogger Bob wonders if this may lead to more carriers adopting some kind of simplified issue process,and I think that may be correct: one of our carriers recently (well, within the past couple of years) introduced a product, in conjunction with its sister P&C company, to offer auto/home clients plans which require no application, exams or even paperwork. Pretty cool. So, it can be done, will be interesting to see if it will be.

[Hat Tip: Co-blogger Bob V and FoIB Brian D]

Dodged a Bullet: A Close Call Non-Client Story

So got a call from Sam, inquiring about possible health insurance options.

Sam has a policy he bought from a company that doesn't, in fact, sell insurance, but is some kind of pre-paid, limited benefit type plan with a $2,000 deductible and $30 co-pays and costs about $300 a month (keep in mind that Sam's in his mid-50's and in good health). Problem is, no one accepts this insurance, and he's not satisfied.

That's typical of these types of plans, which sound really great, until you have to actually use them. But, lesson learned (maybe), one supposes, and I'm happy to offer an alternative.

Since we're out of Open Enrollment season, and he didn't appear to qualify for a Special Open Enrollment exemption, I turned to Short Term Medical plan options. One of my primary STM vendors recently got rid of their (obnoxious, but apparently industry-standard) application fee, and offers a $2 million lifetime maximum on their plan (unlike pretty much everyone else's $1 million max). I found several alternatives priced competitively with his (actual junk) plan, albeit with slightly higher deductibles.

I had also asked him if he was, perhaps, self-employed, and when he told me that he was, I began researching whether he might be eligible for one of those new-fangled Chamber Plans.

So, I called him back with my good news.

And, surprise, he told me that since my STM offerings weren't going to save him any premium dollars, his current deductible was so much lower, he wasn't interested. Okay, but...

And he further informed me that, after speaking with a local hospital admin, and his current carrier, he'd been assured that if he was hospitalized the facility would have to treat him and the insurance would have to cover that.

Of course, that's NOT how EMTALA works.

So he's told me at least one lie, and who knows how many others, and all I can see is "Red Flag Ahead." I immediately cut the conversation short, and thank him for the opportunity to have at least tried to help him. He replied that he understood but was only rejecting the Short Term plan ... No thank you, and best of luck!

(Whew!)

 This was definitely not the type of customer (let alone client) that I'd want to take on.

Revisiting the MVNHS©

It's been a while since we last looked in on Britain's Much Vaunted National Health Service©:

"A doctor said pressures at a Bangor hospital in January left staff in a "very deep hole"

But that was then, and this is, well:

"NHS must apologise for dismissing pelvic mesh and anti-epilepsy drug patients' suffering."

How's that?

When we as patients raise concern about our treatment with those providing it, it's only right that they at least consider what we're telling them. But apparently that's not how it works in one of the world's pre-eminent government-run health "care" systems:

"Since the review launched in 2018, more than 700 families from across the UK have given "harrowing details of their damaged lives ... fought for decades to "achieve acknowledgement" of their suffering."

Turns out, they've actually lost count of how many.

But hey: Free.

#Medicaid4All

[Hat Tip: Holly R]

Double dipping and CV-19

It's not just George Costanza:

$42,000 bill from a “not for profit” Hospital for a Covid patient placed on a vent. (recovered and back to work) I inform them I know they’re getting $39K from the fed gov’t and the self-funded health plan won’t be participating in their double dipping. 💰🏨

— Rachel Means 🇺🇸✌🏼🇺🇸 (@rachel_means) July 7, 2020

Nicely done!

Now, how to get the word out to even *more* folks?