Why Health Insurance Premiums Rise

Mystery solved. HHS Sec. Sebelius let's us in on a secret as to why health insurance premiums are on the rise.

"It has to do with their market place. And frankly there is some justification in saying that one of the issues that has hit companies in the economy - again particularly in the individual market where people are out purchasing on their own - is that healthy folks drop their coverage when the economic squeeze occurs. If you are sicker of have a sicker family member you don't have that luxury, so you're keeping it. So their own risk experience is becoming more expensive. So what we have to do is get healthier people back into the marketplace."

As Bill Clinton said, "It's the economy, stupid".

Pure rocket surgery.

Apparently Sebelius left Washington without TOHHS (Teleprompter Of Health & Human Services) in tow . . .

Health insurance premiums, like all competitive products, are self regulated by market forces. I have witnessed carriers enter the market with rates, approved by the state, that were well below the market.

Those carriers did not last long.

Either they were forced to raise rates considerably, or bow out of the market. One local player has tempered their low rates with a bait and switch approach by showcasing very low rates that change dramatically once the application goes through underwriting. They also have a high rejection rate in excess of 50%.

While it does happen, sometimes a health insurance company has rates that are too high for the market. In Georgia, Blue Cross tends to be on the high side when similar plans are spreadsheeted. The result is a loss of business they would otherwise write if their rates were more in line with competitors.

I see no evidence that rate regulation has any real impact on the value of the product to the consumer, but obviously folks in government have to say something to justify their position, even if it flies in the face of logic.

"so you can find out what is in it"

Health Affairs recently published an article co-authored by 6 actuaries and economists within the Medicare Office of the Actuary in Baltimore.

It’s a good article, focused on spending projections. Exhibit 5 in the article summarizes the Medicare Actuary’s estimates of enrollments in various insurance programs – both public and private - under current law and under the new (reform) law, for the years 2009 thru 2019.

In particular the enrollment projections for the years 2013 and 2014 are interesting because 2014 is the first year for “full” implementation of health care reform, including the individual mandates and insurance exchanges. Comparing the enrollments projected for 2013 under current law with 2014 under reform law illustrates just how remarkably the insurance landscape is expected to change in 2014.

By far the largest changes are projected for two areas.

First, the uninsured, and this should not be a surprise. The uninsured are estimated to reduce from 50.9 million projected for 2013 under current law, to 25.5 million in 2014 under the reform legislation, a reduction to the uninsured of 25.4 million. That’s a 50% reduction in the number of uninsured. Of course a 100% reduction is unrealistic but couldn’t one have hoped for a reduction larger than 50% in exchange for committing those trillions of our grandchildren’s dollars? Oh, never mind.

The second expected large change is in the number of Medicaid/CHIP insured. This number is expected to grow from 63.4 million projected for 2013 under current law to 85.2 million in 2014 under reform legislation – an increase of 21.8 million people.

Fewer uninsured by 25.4 million. More Medicaid/CHIP by 21.8 million. In other words, health care reform is expected to reduce the uninsured by half, and just about all those people will gain insurance through Medicaid/CHIP. That may be a rather more surprising outcome to many observers.

But actually, growing Medicaid/CHIP is about the only way a meaningful reduction to the number of uninsured could be achieved.

Ohio Health Insurance: Now on hold

Bob's been doing a yeoman's job keeping us updated on the Peach State's health insurance market; now it's my turn to recap what's going on in the Buckeye State.

First, Anthem Blue Cross is in hibernation: no rates, no plans, no quoting for anything past Wednesday (in anticipation of the 9/23/10 mini-Armageddon). We can quote and write Short Term Medical and conversion plans, but that's it on the medical side. No major medical plans for either adults or children. You might say they're on a self-imposed "lockdown."

Next, Humana and Medical Mutual will continue to quote and issue adult-only policies, but no "family" plans which would include children. Humana will not write children-only plans, and it's unclear whether or not Medical Mutual will continue to offer them past the 22nd.

Aetna says that they'll continue to write plans with children if one or more adults are also included. Unfortunately, we don't have rates or plans available yet.

Assurant Health (a relatively minor player in this market) is also closed for business after the 23rd, but hopefully will have plans and rates available in time for October effective dates.

Finally, United HealthCare's individual plans seem to be in flux: for one thing, the soonest you can have coverage effective is 30 days from when they receive the application (or when it's completed online). So the soonest one could have coverage is now October 20th. The quoting system also still includes lifetime and other caps, which are a no-no going forward. I spoke with the Home Office, which confirmed that the caps will not, in fact, be included but the rating system doesn't yet reflect that. They also confirmed that they will also no longer offer child-only coverage.

Hope and change for all!

[Thanks to Kelly W for her help on this post]

Postponing the Health Insurance Purchase

"I don't need health insurance since I am healthy". No matter how often I hear that it never makes sense.

The guy in the casket at the front of the church probably could use some life insurance but unfortunately it is too late to do anything about it.

Same for health insurance.

You can't buy it once you get sick.

Almost 2 months ago I was referred to a lady who would be needing health insurance when her COBRA expired at the end of September. I called and was told she was busy with other things but she would get around to it soon.

Over the next few weeks we had sporadic contact and then about 3 weeks ago she finally got serious about it. After going back & forth on options she finally agreed to complete an application for coverage. Even then it was a challenge to keep her on task.

Last week she faxed the application to me for review. The next day she emailed to say she had an exam including a colonoscopy scheduled for a few days later. We went through several questions, including questions about any symptoms or family history that might have prompted the colonoscopy.

She assured me there was nothing in her history but her doctor thought it would be a good idea.

By now the only thing we could do was submit the application and hope for the best. During the phone interview with the underwriter they noted she had filled a prescription for Movi-Prep . . . a medication to purge the bowels in advance of the exam.

The carrier opted to postpone taking any action until AFTER the colonoscopy. They were well within their right to do so.

Fast forward to today.

I got a call from her ex, telling me the results of the exam. They found 6 polyps and have sent them off to pathology and are awaiting the results.

Hopefully she will have a good prognosis, but this does put a kink in any plans for applying for health insurance. Now she will have to wait 12 months at a minimum, have a follow up colonoscopy and hope it is clear. Even then, there is no guarantee she can get coverage then.

And about that expiring COBRA . . .

Her only option now is to apply for coverage through the state risk pool.

Sometimes when an agent suggests moving forward it is best to listen to them rather than putting off a decision that limits your options.

Buh-bye, Gramps!

Looks like the promise that "if you like your current plan, you can keep it" is officially dead.

How did I arrive at this morbid conclusion?

By taking this test (and Hats Off to BCBS of Georgia for this interactive tool).

We've covered the "grandfathering" issue before, but it's important to understand that, come this Thursday, (9/23/10), that promise officially goes under the bus. You see, that's the next ObamaCare© "expiration date," and it's by far the most crucial one. After Thursday, the "grandfathering" provisions of ObamaCare© go online, and the countdown to the end of your current plan begins.

How can I be so sure?

It's quite simple, really: when you cut through all the other provisions, there are two which will will make it impossible to keep your current plan. These affect both individual and group plans, and we'll look at both.

The first thing to understand is that being grandfathered means being exempt from certain ObamaCare© provisions, such as Community Rating (coming in '014) and unlimited preventive care (coming this Thursday). The former will increase premiums dramatically, the latter somewhat less. Some employers think that they can insulate themselves from these changes, but one provision in particular makes that impossible: to remain grandfathered, an employer can't increase employee's share of the premiums by more than 5% of the 2010 levels. Not just in 2011, but ever. This means that (to maintain grandfathered status) an employer could never increase the percentage of employee's contributions by more than 5%, while his own premiums begin their inexorable climb upward.

Think you're exempt because you have an individual medical plan? Wrong. As you know, premiums increase because the cost of health care increases; in the past, you could insulate yourself by switching carriers every couple of years. No more: if you switch carriers, you lose grandfathered status. Lose that, and your premiums will go even higher as your plan will now have to include a host of "benefits" you may or may not want or need (and those are just the ones we currently know about - it seems like each day brings revelation of another gotcha as we "learn what's in it").

The bottom line is that you will not be able to keep the plan you have. And if you're in a group, don't think for a minute that your employer isn't seriously considering dropping the group plan altogether. Think that's scare-mongering? Fine, but keep this in mind: businesses exist to make money. The cost of health insurance is already high, and heading higher. Employers aren't (yet) required to offer health insurance, so it's a very easy (and cost-effective) thing to jettison.

Kind of changes one's hopes, doesn't it?

Changes for Health Insurance in Georgia

Affordable health insurance in Georgia is about to become as scarce as hen's teeth.

For those who wanted change you can believe in, here is what has happened so far to health insurance in less than 6 months since Obamacrap was signed into law.

In GA and other states, some health insurance companies have thrown in the towel. More will follow over the next 18 months or less.

Fewer health insurance companies means fewer choices, less competition and higher prices.

Plans that were affordable before will no longer be available due to Obamacrap mandates. They will be replaced by plans that are higher in premium.

Some new plans will come on the market, and in an attempt to lower premiums, will not cover things like brand name drugs. Some will restrict access to certain doctors, hospitals and medications by moving these services to out of network items.

BCBSGA has approval on two new plans with fewer doctors, fewer hospitals and fewer brand name drugs in the mix. Other health insurance companies will follow suit.

Maternity benefits as part of an individual health insurance plan is almost non-existent any more. When you can find it the cost of the add-on benefit is cost prohibitive.

If you want to insure your child under the age of 19 you will have to buy a policy on yourself. No longer will you be able to buy health insurance policies on children as stand alone coverage.

Even with the new law, your child can still be denied coverage if the condition is severe enough and the allowed rate adjustment is insufficient to support the risk.

Before 9/23 if your child had a pre-existing condition a rate up would be applied to that child's premium alone. If the maximum allowed rate up was sufficient to cover the risk, coverage would be issued. If not, coverage would be denied.

Depending on the health insurance company, the maximum allowed rate up was between 50% and 150% before they could decline coverage.

Post 9/23 the maximum rate up can be applied to ALL family members applying for coverage. That means a standard family rate of $500 can grow to $1250 before the carrier can deny coverage.

Smaller cars, bigger health insurance, Poppa Washington

Note: Similar changes have been occurring in other states, but we are only addressing these situations on a state by state basis since every state is different.

Adverse Selection and the Uninsured

Let's connect some dots, shall we?

According to the folks at Kaiser Health News, the US Census Bureau reports that "[t]he number of people with health insurance in the United States dropped for the first time in 23 years ... percentage of people without health insurance increased to 16.7 percent."

Certainly not great news, but then, not unexpected, either.

Why's that, you ask?

Some of it's basic economics: if Mom and/or Dad has lost their job (as a record number of folks have over the past 2 years), then there's less income. Some expenses are pretty much unavoidable: rent or mortgage payments, food, utilities, that kind of thing. Others are important, but expendable: cable and internet, cell phones, maybe the second car. And some things are "necessary evils:" say, insurance. The life insurance is probably the first to go, but the health insurance is pretty expensive, and the folks are relatively healthy...

If you're down to one (or no) income - as so many Americans are - then you start looking at ways to trim the budget that may not be all that attractive, but are necessary nonetheless. If Dad had a heart attack last year, you're not dropping him, but Mom's past the baby-making years and in good health, and her health insurance premiums could pay a good chunk of the mortgage. Little Timmy is epileptic, so he stays, but his sister Suzie is in pretty good shape, we'll roll the dice on her.

There are some long-term problems with that kind of thinking. For one thing, you're assuming that, if little Suzie gets sick, ObamaCare© will allow her to buy health insurance. As we've seen, that's not necessarily the case. But no one really knew that until now (although a lot of us suspected it). And it also means that the healthier folks are the first ones to bail, leaving behind a sicker insured population. Sicker people means more expensive and frequent claims, which means higher premiums, which means more people dropping their insurance, which means...well, you get the picture.

Is this good news or bad news for folks who see ObamaCare© as the solution? It seems to me that the overarching problem is that it doesn't address the problem that health care costs keep going up, and it's actually driven back any gains we might have made because of what's happened (and continues to happen) to the insurance marketplace. Fewer people working means more people on Medicaid, but also fewer people paying taxes to fund Medicaid (and SCHIP and all the rest). Now, that’s not completely accurate, because there are any number of folks who have ditched the corporate world (some voluntarily, some not) and started their own businesses. But even if they stay insured, that's a wash, no net loss in the pool of insured folks, but no gain, either.

And there's this: as we pointed out some time ago, a rather large cohort of the uninsured is those here illegally. They have health care expenses but no insurance. What portion of that 16.7% are illegals? Who knows, but it's more than a couple. How does ObamaCare© plan to deal with them?

Well, we had to pass the bill to find out what's in it; maybe that's next.

Child Health Insurance in Georgia

The availability and affordability of children's health insurance in Georgia is still evolving under Obamacare. It does not appear ANY Georgia health insurance company will issue children's health insurance on a stand alone basis. Any child seeking coverage must be part of a plan with at least one parent.

It now appears most carriers will blend any underwriting rate up for pre-existing medical conditions over all family members. One sick family member, especially a child, will have the cost of their care shared by other family members in the form of a higher total premum.

At least some health insurance companies have indicated it is possible a child who applies for health insurance as part of a family plan may still be denied coverage if their condition is expensive to treat. HHS opened that door a few months ago by allowing health insurance companies to only admit children on a "free pass" during open enrollment.

Problem is, HHS has not defined what an open enrollment period is or when it occurs.

Like everything else with Obamacrap, Washington is making up the rules as they go along since they have no clue.

If you don't like the rules today, no problem. By tomorrow they will only get worse.

Smaller cars, bigger health insurance headaches, Poppa Washington.

Anthem Blue Cross suspending sales of Child-only plans

Ten minutes ago, I received an email from Anthem stating that they were suspending sales of child-only plans effective today, September 17. The reason cited was the uncertainty created by the Patient Protection and Affordability Care Act. Adverse selection was also cited...because some carriers stopped selling child-only plans, the remaining ones were going to get saddled with the kids with medical problems.

There will be some cases when child-only plans will continue to be available:

"The suspension of child-only plans will apply to all states unless a particular state requires the offering of child-only policies. Based on state specific requirements, we will continue to offer Child-only plans in Maine and New York, and in open enrollment periods in Ohio and Virginia. Child-only plans will also be offered in those states requiring such policies for conversion and HIPAA eligible individuals. Existing policyholders will not be impacted by this action and they may continue in their current coverage."

Also unaffected are family plans where the primary subscriber is over 19.

ObamaCare strikes again...just another example of this well thought-out law.

ADDENDUM [HGS]: Bill's up early this morning, and beat me to the punch. For those who may be interested in the fine print, a pdf of the "News Flash" is available here.

Cavalcade of Risk #114: Call for Submissions

Russell Hutchinson hosts next week's Cavalcade of Risk. Submissions are due this Monday (the 20th). Please remember to include:

■ Your blog's url
■ Your post's url
■ The post's trackback URL (if available)
■ A (brief) summary of the post

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

You can submit your post via Blog Carnival or email.

HCSC Info Bleg [UPDATED]

[Important updates below]

An anonymous (but vetted) reader tells us that HCSC (the holding company for Blue Cross Blue Shield franchises in Illinois, Texas, Oklahoma and New Mexico, and the fifth-largest health insurer by enrollment) is in "lock down mode" following a gag order imposed last Friday (September 10, 2010). If any of our readers have details, we'd appreciate a heads' up as soon as possible.

Just drop us a line here, and your information will be treated as confidential.

Thanks!

Clarification: I was very hesitant to run with this because so many details are lacking, but my correspondent is very credible, and there does seem to be some urgency involved. I did leave voicemail with both HCSC media contacts (and emailed them, as well). There's nothing about it on the corporate website, but that's not necessarily indicative of anything untoward. There may be nothing to this, but again, this came from a reliable source, and it seems relevant to what we do here at IB. We'll keep you posted.

UPDATE [1:10PM]: Just spoke with HCSC media contact Ross Blackstone, who assured me that there is no "gag order" in place.

It's worthwhile noting that, as Megan McArdle hints, it is disturbing that the actions of the folks behind ObamaCare© make claims of a gag order credible. Thankfully, these fears appear to be unfounded in this case.

By the way, I ran this story early because, if there had been a gag order, there was no way to know if and/or when I would have received corroboration. A vicious circle.

Another twist [4:00PM]: This may, in fact, be a self-imposed "gag order.". On an insurance agents' forum, we find this post (#14):

"BCBS-IL just sent out a Special Bulletin to the field telling us to stop talking to our customers about what BCBS-IL may be doing in regards to healthcare reform. It also said that BCBS-IL will communicate with us when they have something to say.

They're probably about to implement a big rate increase for the 101 new preventive services. Wait a minute, they can't do that without state approval now...right? Could take MONTHS. Since all the brochures were removed from the Blue Cross Blue Shield of Illinois - Health Insurance Illinois - BCBSIL website this afternoon, a "hold" on sales may coming? "

That certainly explains why my correspondent was unsuccessful in communicating with folks inside HCSC.

Health Wonk Review is up

Louise Norris hosts this week's compendium of wonky posts from around the 'sphere. Check it out.

Chris Dodd, Actuary?

Connecticut Plus reports Sen. Dodd as saying:

“Connecticut families have suffered from skyrocketing health insurance prices and the industry’s abusive practices for far too long,” said Dodd. “To now try to attribute a more than 20 percent proposed rate hike to the new health care reform law after years of continually proposing comparable double-digit rate hikes in Connecticut is both reprehensible and dishonest.

People who live in glass houses . . .

Or perhaps, it takes one to know one.

He should have thought about the repercussions of Obamacrap before voting on it. We already know he didn't read the bill before voting.

Humana vs PPACA

First, Humana continues to be a valued player in the health insurance market, which is a good thing (I'm a big proponent of competition). This post is about mail I received from them this morning, but is not to be taken as a slam on Humana; rather, it is illustrative of the destruction being wrought by ObamaCare©. I fully expect to see similarly worded missives from other carriers over the next few days.

Remember that promise that "more people will be able to get insurance?"

Well, not so much going forward.

From the letter:

"As of Sept. 18, 2010, we will stop quoting coverage for applicants under age 19 ... We will not issue a policy for applicants under age 19 with an effective date on or after Sept. 23, 2010"

This is a direct result of the Guaranteed Issue provisions of ObamaCare©. Since the carrier cannot turn a minor away, and it's unlikely they'll be able to price for the as-yet-unknowable risks, they've shut the door. This is an entirely rational and justifiable decision, by the way, and one which should have been seen by HHS Secretary Shecantbeserious as her agency started implementing the various provisions.

"If a dependent under age 19 applies with a parent or legal guardian and the parent or legal guardian is uninsurable, the dependent is ineligible."

This is consistent with the first condition stated above, and makes sense from a risk-management perspective. The overarching theme is that we now have fewer, and much more expensive, choices.

That extra expense, by the way, doesn't buy better benefits. Quite the contrary. In another Humana mailing we received this morning, the carrier announced substantial changes to its prescription drug benefits. For example, there are increased pre-authorization requirements for refills. On the other hand, quantities of refills are being reduced, which will add to the total out-of-pocket cost of their members' health care.

Most PBM's (Pharmacy Benefits Managers) assign medications to various "tiers," which then dictate a medication's co-payment amount. Those are changing, as well:

"[I]f members fill or refill a prescription for one of the drugs changing levels ["tiers"], they may pay a higher copayment."

Again, this makes sense, but, as we noted previously, it puts the lie to the notion that ObamaCare© will lower the cost of either health care or health insurance.

As Bob says: Smaller cars, bigger health insurance headaches, Poppa Washington.

On "Mini-Med's" and Clarity

This month's issue of Employee Benefit News (an industry publication) has an interesting article on so-called "mini-med" plans, and their role (and rules) under ObamaCare©. We've written extensively on these plans previously, but what I learned yesterday offers a somewhat different perspective.

The first thing I learned is that, as Inigo Montoya might say, "this term 'mini-med:' I do not think it means what you think it means." You see, I've been using the terms "mini-med" and "limited benefit" interchangeably, but they are not necessarily the same thing. According to John Ferguson (President of South Carolina-based BasicPlus Insurance Services), a "mini-med" plan may include deductibles and co-pays, and even co-insurance ("80/20"), while a "limited benefit" plan pays a fixed benefit for specific services (a $40 reimbursement, for example, for a doctor's office visit). While these may not seem like significant distinctions, they are treated very differently under ObamaCare©.

As we've mentioned, one of the new regulations is that policies may no longer have lifetime maximums or internal benefits caps. That's a problem for the "mini-med" plans, which are generally priced much lower than a "regular" major medical policy because the carrier has a much more limited exposure. Under ObamaCare©, though, those caps become problematic:

"So-called mini-med plans that provide bare-bones health care coverage at an affordable rate to mostly blue-collar and entry-level workers, as well as part-timers, temporary staffers and seasonal employees, were nearly- given a death sentence under health care reform." What saved them (for now), is that the carriers which offer them can apply for a temporary waiver; according to Mr Ferguson, Allstate and Cigna have both applied for, and been granted, that reprieve. The problem is that these waivers are only good for a year, so next year they'll have to re-apply.

The other major problem facing "mini-med" plans is that, starting January 1st, they'll be subject to another ObamaCare© sandtrap: MLR. The "Medical Loss Ratio" is a (dubious) metric which requires that a carrier pay out at least 85% of its revenue in claims. We'll debate the merits of this requirement in another post, but suffice it to say that it will be exceedingly difficult for a "mini-med" carrier to meet this requirement. One industry rumor has it that carriers will combine various "lines of business" to meet this goal.

Which brings us back to those "limited benefit" plans. Unlike the mini-med, limited benefits plans aren't subject to the most egregious elements of ObamaCare©, including the onerous MLR requirement. Mr Ferguson believes, and I tend to agree, that these types of plans will be much easier to market under the new regimes.

One final note, somewhat off-topic, but related: There are a spate of both mini-med and limited benefit plans which tout themselves as "HIPAA Compliant." The implication of this claim is that a limited benefit or mini-med plan will be considered "Creditable Coverage" for folks obtaining new group health insurance (assuming group insurance survives, which is not a given). This is at best misleading, and at worst untrue: there is no magic wand that one carrier can waive that will obligate the next one to recognize a given plan's portability. If you see this phrase on a sales piece, be very skeptical. If it's too good to be true...

And so the first shot is fired...

One of the interesting, and frustrating, elements of ObamaCare© is its unprecedented power-grab at the expense of the individual states. It's heartening to see, however, that the 10th Amendment isn't completely dead yet, and that a dozen-and-a-half states have taken the Obamistration to court in an effort to derail (or at least defang) ObamaCare©.

Today marks the beginning of the first major round of court battles, as the "Justice" Department asks U.S. District Judge Roger Vinson to enjoin the states from even pursuing their lawsuit, countering that:

"[O]verturning the health care law would unduly expand judicial review of Congress and other government branches. More specially, the DOJ argues that Congress has the power to determine how federal money appropriated for Medicaid may be spent and can give states an option of setting up their own health exchanges or having the federal government do so."

Overstepping bounds? Hey, that's the Fed's job!

And by the way, that little "option" at the end is an interesting red herring: the unconstitutional (and evil) mandate is about individual rights, and have nothing to do with the exchanges (except tangentially).

We'll keep you posted.

Children's Health Insurance in Georgia

And now there are two . . .

As the Obamacrap imposed 9/23 deadline for change in the way children obtain health insurance approaches we now have two health insurance companies that are willing to play the game.

At least for now . . .

Blue Cross of Georgia will introduce new plans and rates in a few days. They will have only one plan for children who want stand alone coverage or who are otherwise uninsurable.

As of now, Kaiser will offer a full array of plans for children and final rate after the underwriting review is yet to be determined.

Starting rates may be favorable but I would not expect final rates (after underwriting) to be pleasant. What we have seen from other carriers for dependent child rates is enough to make your hair stand on end. Final (underwritten) rates will easily go north of $500 per month for a $2500 deductible copay plan.

Parents who want to include their children on their plan will have to sell an organ to pay the premium.

HHS Secretary Shebullshits can try to shift the blame but everyone in Washington who created this mess now have to own it. This is what happens when you put folks in charge who have no real world experience and no clue. November elections can't come soon enough.

HHS Shecantbeserious Steps in it...

The reason that she's so dangerous is because she's so ignorant:

"There will be zero tolerance for this type of misinformation and unjustified rate increases," Health and Human Services Secretary Kathleen Sebelius said in a letter to the insurance lobby."

Now that may seem brave - after all, she's taking on the fierce and vicious health insurance industry - but it is, in fact, quite stupid. For one thing, she has no (zero, nada, zilch) power to enforce her little threat. For another, even if she was able to carry through, she would do far more harm than good in doing so.

Why's that, you ask?

It's pretty straightforward: insurance companies need to make a profit. It's how they (or any other business) stays in, well, business. Beyond that, though, there are statutory and regulatory regulations that require carriers to have a certain amount of reserves and liquidity. Under ObamaCare©, carriers are forced to cover an ever-expanding list of expenses; if they can't price for the increased risk, they'll lose money. That has the medium-term effect of draining reserves, but, as Moody's rating service reminds us, HHS Secretary Shecantbeserious' "warning to health insurers about “unwarranted” rate increases could raise questions about the insurers’ ratings." If a carrier's financial rating plummets, so does its ability to conduct business.

One begins to suspect that the folks in DC consider that a feature, not a bug.

Grand Rounds, End of Summer edition, now online

Julie Rosen, proprietress of the Bedside Manner blog, hosts this week's round-up of medblog posts. Come for the beautiful scenery, stay for the insights.

1099's Hit the Radar*

*Or: Why it's called the "Stupid Party:"

"Many Democrats have joined Republicans in pushing for the repeal of a tax provision in the new health care law that imposes a huge information-reporting burden on small businesses."

The fact that Democrats, facing a potential tidal wave of electoral punishment, are on board with this is quite understandable. Anything to mitigate the damage would be, from their standpoint, a win-win.

But for Republicans to even entertain this idea is abhorrent: ObamaCare© wasn't foisted on us piecemeal, it was jammed down our throats all at once. And that's how it must be defeated, not by "a thousand cuts," but total and complete destruction. It doesn't need to be "fixed," it needs to be eradicated. And you don't accomplish that piece-by-piece, it must be eliminated all at once, as well.

Proof of concept:

"The White House is nervous about a repeal, fearing that it could set a precedent for rolling back other unpopular features of the law."

No, it isn't. The President knows full well that the opposite is true: identifying and lopping off one little piece validates the remainder. One hopes that what passes for Republican leadership understands this, as well.

Not so bad after all ?

[Welcome Reason readers!]

Last week the Wall Street Journal carried this article. In it, we learn that Max Baucus has news for us about health care reform, via a recent town hall meeting with his constituents in Montana:

"Senate Finance Chairman Max Baucus, who wrote most of the bill, attempted this line at an August townhall in Billings, Montana when he tried to calm an angry voter by saying, "Mark my words, several years from now, you're going to look back and say, 'Well, that wasn't so bad after all.'"

There's a ringing endorsement for you.

In other words, Baucus is telling me not to worry about all the rattles I hear in this Cadillac he sold me (that I can't afford). I'm not to worry because in a few years I won't think they're so bad. After all.

Anybody else buy a Cadillac from this guy Baucus? Does yours rattle, too?

On Grapefruit and Lemons

Despite its tart reputation, grapefruit may indeed be the sweetest of all (metaphorically speaking):

"New joint research by scientists at the Hebrew University of Jerusalem and Harvard University’s Massachusetts General Hospital (MGH) has demonstrated the mechanism by which a single compound in grapefruit controls fat and glucose metabolism ... causing the liver to break down fatty acids. In fact, the compound seems to mimic the actions of other drugs, such as the lipid-lowering fenofibrate and the anti-diabetic rosiglitazone."

In short, a team of American and Israeli scientists my have found a naturally-occurring treatment for diabetes. Not only that, but it may also help lower cholesterol. Dig in!

Some doctors, on the other hand, are more like lemons:

"San Diego anesthesiologist Adam Dorin, founder of PhysiciansAgainstObamacare.org, writes in the fall issue of the Journal of American Physicians and Surgeons that the AMA is more interested in its prestige and financial contracts than physicians' interests."

Well, dunh!

As we noted months ago:

"[G]rowing opposition (to ObamaCare©) makes the actions of the AMA, which represents only 17% of the doctors in the U.S., look very bad."

The good news is that fewer than 1 in 5 doctors actually belong to the American Medical Association. The bad news, of course, is that it's the "go-to" source for the media in its effort to drive the ObamaCare© narrative. As Dr Dorin notes, "the AMA makes $70 million to $100 million a year from its exclusive contract with the federal government for the sale of coding books that physicians use to bill insurance." This is the "billing bible" that health care providers use to determine pricing and reimbursement. By controlling this key tool, the AMA is in a unique position to profit from the 3rd party reimbursement system (aka insurance and Medicare).

It's enough to give one a headache.

Paying for Obamacare

Does anyone know how Obamacare is funded? The tooth fairy? Manna from Heaven? Santa Claus? China?

We came across a secret transcript from a meeting of elected officials whose identity has been scrubbed to protect them from further embarrassment.

"We need a way to pay for this health care bill without actually raising taxes. Suggestions?"

Dumb ass #1: "Let's do a specific industry wide tax on medical equipment companies. I can't see that raising health care costs."

Dumb ass #2: "Let's eliminate using HSA's for OTC drugs to create more tax revenue. This package is going to be so good, everyone will be able to buy prescription drugs anyway."

Dumb ass #3 - "Let's require health insurance companies to issue coverage to anyone, regardless of their health. Sure, this will increase premiums dramatically but then we can tax people because their premiums are too high. We can also tax people who don't buy health insurance."

Dumb ass #4 - "Let's add a bunch of new benefits such as preventive care and tell everyone it is free. They will love it!"

Dumb ass #5: "Let's make huge cuts to Medicare and tell the public that coverage won't be effected. Oh wait..do you think the public will ask why we didn't do this earlier if we had the ability? Oh never mind, they're too stupid."

Dumb ass #6: "Let's just tell the clinics we'll pay them less, it worked for Medicare, why not for everyone? Oh, you're saying the under 65 market subsidizes the clinics through higher premiums? No problem, we're the federal government, they'll have to do more with less."

Dumb ass #7: "Why don't we increase Medicaid eligibility to more people and make the states pick up the tab. Well, except for Nevada and Florida since we want to get re-elected."

"Good work guys, next problem to solve? We need to find away to get more voters in our corner, why don't we give citizenship to everyone in this country illegally?" 

Obama Smokescreen

Just when you thought their noses couldn't grow any more, Obama and Sebelius are tag teaming their way to blaming someone else for problems they caused. Rising health insurance premiums can't be blamed on Bush, so they pick another candidate.

Blame the health insurance companies.

But before addressing their bullshit, let's take a look at what Obamacrap is requiring health insurance companies to cover.

70+ preventive care benefits, many of which are not currently included in existing plans. All of these benefits are to be offered at NO COST TO THE PATIENT. That means either the doctors and labs must agree to offer their services for free or premiums must increase to take on this additional cost.

Obamacrap eliminates annual and lifetime benefit maximums. No more $5,000 drug caps or $100,000 annual benefit maximums. Striking caps is not a bad thing but it isn't free.

DAMN (drug, alcohol, mental and nervous) benefits must be covered as any illness. No more differentiation in copay's or separate benefits for DAMN coverage. These claims must be treated as any other illness.

Same for maternity. If your plan covers maternity it must treat that claim as it would any other illness. No more separate deductibles or limits.

No more HSA/HRA/FSA coverage for OTC drugs without a prescription. That means more office visits to get that required prescription and possibly even a change to a different, more expensive medication . . . since you are already visiting the doctor any way . . .

And let's not forget the health insurance equivalent of "no child left behind". As of 9/23/10 health insurance companies will be required to offer coverage to any child that applies for insurance without regard to pre-existing medical conditions. In other words, if you have a child, sick or well, health insurance companies cannot deny coverage, no matter how expensive treatment for existing medical conditions may be.

Take a moment to catch your breath and think about all these NEW benefits that must be paid for by health insurance companies. Benefits that were not covered 6 months ago.

Now for the Obama and Sebelius bullshit.

The AP is reporting that HHS Secretary Kathleen Shebullshits is taking aim at and declaring war on health insurance companies if they try and blame Obamacrap for increased health insurance rates.

President Barack Obama's top health official on Thursday warned the insurance industry that the administration won't tolerate blaming premium hikes on the new health overhaul law.

"There will be zero tolerance for this type of misinformation and unjustified rate increases," Health and Human Services Secretary Kathleen Sebelius said in a letter to the insurance lobby

Misinformation indeed. Obamacrap was built in secret, behind closed doors in spite of promises the public would have time to review the proposal before it was to come to a vote. This was part of a pledge to have the most transparent administration ever.

"Simply stated, we will not stand idly by as insurers blame their premium hikes and increased profits on the requirement that they provide consumers with basic protections," Sebelius said. She warned that bad actors may be excluded from new health insurance markets that will open in 2014 under the law. They'd lose out on a big pool of customers, as many as 30 million people nationwide.

Get a clue, Shebullshits.

Half the 30 million that are supposed to be covered will go on welfare and be assigned to Medicaid. If the other 15 million or so are "prizes", then why are so many health insurance companies running as far as they can from Obamacrap? Some carriers have already announced they are withdrawing completely from the individual health insurance market while others are making noises like they won't be here past 2011.

Doesn't exactly sound like they are chomping at the bit to play that game.

Although the law's big expansion of coverage under the law won't take place until 2014, several new benefits go into effect starting later this month. Lifetime dollar caps on coverage are abolished, and plans must allow parents to keep their children on the policy up to age 26. Many plans will also have to guarantee coverage for children regardless of a medical condition, and provide preventive care with no cost-sharing for the patient.

The administration estimates that those new benefits will raise premiums by no more than 1 to 2 percent.

Estimates are worthless, especially given Washington's track record on projecting costs. The ink on Obamacrap is hardly dry and already the CBO and actuaries at CMS are saying earlier cost figures for Obamacrap are low.

So far, very few Georgia health insurance companies have released post 9/23 rates. The few that have are increasing 5 - 8% with childrens' rates tracking much higher.

Um, about those terrific ObamaCare© cost savings...

Not happenin':

"The nation's health care tab will go up -- not down -- as a result of President Barack Obama's sweeping overhaul."

Oh, those nasty Republican naysayers and awful bloggers! They just keep spouting the company line.

What?

It's not the GOP or IB saying this?

Well, then: whom?

"That's the conclusion of a government forecast released Thursday ... said economist Andrea Sisko of Medicare's Office of the Actuary, the nonpartisan unit that prepared the report."

Where's Emily Litella when you need her?

MORE: As the Fox item above notes, even the "modest" increase assumes certain levels of reduction in Medicare reimbursement rates, all the while "guaranteeing" seniors continued access to necessary health care.

Unfortunately, that prediction may be a bit, um, rosy:

"Richard Foster, Medicare's chief actuary, noted that Medicare payment rates for doctors and hospitals serving seniors will be cut by 30% over the next three years. Under the policies of the Patient Protection and Affordable Care Act, by 2019 Medicare payment rates will be lower than under Medicaid."

Ooops.

And remember, under ObamaCare©, more Americans on the Medicaid rolls is considered a feature, not a bug. And that's the good news; it actually gets worse from there:

"The drastic reductions in Medicare reimbursements under ObamaCare will create havoc and chaos in health care for seniors."

I must respectfully disagree with the gentleman making those remarks (Peter Ferrara, director of entitlement and budget policy at the Institute for Policy Innovation). "Havoc and chaos" are necessarily predicated on choice. Why would he assume seniors will have any?

Georgia Health Insurance Challenges

If you live in Georgia, and have had difficulty finding health insurance (at any price) on your children, the BBC (British Broadcasting Company) would like to hear from you.

Also, if you live in Georgia, and are hoping to find affordable health insurance for your children once the Obamacare mandates go into effect, but have had trouble even finding ANY coverage, the BBC wants to talk to you.

I was contacted by a U.S. based correspondent for the BBC and questioned about the challenges and unintended consequences of Obamacare, particularly with regard to health insurance for children. They would like to interview parents of children with pre-existing medical conditions that have made it impossible for them to obtain health insurance in Georgia.

Your information will be kept private. We will need your contact information to relay to our contact at the BBC but do not provide any specific details about medical conditions. They wish to talk to parents of children under the age of 19 who have been unsuccessful in finding health insurance in Georgia.

If you would like to be interviewed, send us an email with your name and contact information. We will pass it on to the BBC.

Rosh HaShannah 5771: L'Shannah Tova!

Happy New Year to all of our Jewish readers. For those not of the Jewish faith, Rosh HaShannah ("Head of the Year") begins this evening; it marks the beginning of what we call the "Days of Awe," a 10 day period of introspection and, hopefully, renewal, culminating in the fast day of Yom Kippur ("Day of Atonement").

As with all Jewish holidays, this one begins at sundown the night before, hence the afternoon posting.

Factoid: Reform Jews (by far the largest denomination in the US) celebrate but one day of Rosh HaShannah, while Conservative and Orthodox (among others) observe 2 days.

It is traditional to celebrate the New Year by eating apples and honey; I would encourage those who wish to do so to share their favorite apple and/or honey dishes in the comments.

And for those interested in a slightly off-beat (in the sense of strange and new), check out these new arrangements of traditional High Holiday melodies.



May you and yours be inscribed in the Book of Life.

Stranger-than-fiction Life Insurance: Deja Vu edition

Regular readers may recall this story from 4 years ago:

"A pair of Los Angeles women may have insured the lives of homeless men, then arranged fatal hit-and-run “accidents” so that they could collect the death benefits, officials say."

As I said at the time, this was "sick."

But someone else (actually, four someone else's) have gone one, um, better:

"Federal Bureau of Investigation headquarters today highlighted a recent conviction in a scheme by four individuals in the Los Angeles area to invent a man out of whole cloth, hold his funeral, and then reap in the insurance benefits from his death."

This guy wasn't just homeless - he was bodiless, as well. The article lacks more than a few details, but we can infer that at least two carriers were involved, since the total amount at risk would have required at least some additional underwriting beyond an application. Makes one wonder, though, how many of these schemes are successfully pulled off.

[Hat Tip: Best of the Web]

CDHP's: The Expanded Version

National Review health blogger (and FoIB) Avik Roy has written an insightful and helpful post on the role of Consumer Driven Health Plans (CDHPs). He examines the pro's and cons (including a link back to our own exclusive expose on network re-pricing problems).

His conclusion - that Consumer Driven plans will shine under ObamaCare© - may be a bit controversial, but it's certainly well-reasoned and supportable. Recommended.

Clue for the Gray Lady: D'Uh!!

Full disclosure: several years ago, I had the privilege of being interviewed by the NY Times' Reed Abelson, a very nice lady. She apparently has (or shares) the "health beat" for the "Paper of Record," and seems at least interested in what the blogosphere has to offer.

That said, I really wish reporters like Ms Abelson would spend at least an hour or so boning up on simple economics:

"Instead of sharing the pain, as they have generally done in the past, employers chose to keep their costs steady by passing the higher costs onto workers."

Here's that clue, Reed & Co:

Employers don't pay any premiums. They don't share in them, they don't "pass them along."

Once more: Employers. Don't. Pay. Premiums.

They collect them and send them along to the insurer(s).

Of course, reporters aren't the only folks guilty of this ignorance: President Obama (and others) are currently touting a "tax break" for businesses, which is based on another false assumption; as with premiums, businesses don't pay taxes, they (you guessed it!) collect them.

By way of analogy:

A few years ago, I was treated to lunch at a fairly nice restaurant. As I was chewing my salad, I felt something cold, hard and metallic clatter against my teeth. Spitting it out, I saw that - along with the croutons - I had been served a nut (as in "nuts-and-bolts" nut). When I pointed out this faux pas to our server, she offered to take the cost of the meal off the check. Which was nice but, seeing as how it wasn't my check (but they were my teeth!), I failed to see how this helped me.

Just like me and my "free" lunch, businesses don't pay the tax tab, so offering them a "freebie" is of dubious value. What would be beneficial would be a "regulations" break; a respite, as it were, from the onerous new rules encompassed in Obamacare©. Now that would be a break worth chewing on.

Cavalcade of Risk #113 now up and running

Host David Williams applies a "pretty tough filter" to this week's roundup of risk-based posts. The result is a terrific, on-target collection without a lot of fluff. Stop on by!

In which we reflect that it really is important to see the right physician

One of the consistent themes at InsureBlog has been the inadequate participation of physicians in setting health policy, for lo! these past 40+ years. See here and here and here and here.

I ask you – what do you truly prefer? Medical policy guidance from physicians ? Or from Nancy Pelosi, Harry Reid, and Max Baucus? Insufficient physician participation over the years created a policy leadership vacuum. Nature abhors a vacuum. And just look what rushed in – Pelosi, Reid, Baucus, et al.

Yes, most physicians are kinda busy with other important stuff.

But here is just one illustration of what I mean by inadequate participation: ModernHealthcare's 2010 list of the “100 Most Powerful People in Healthcare”.

The top 50 in 2010 include 8 physicians – 16%. There is exactly 1 physician in the top 10. There are 5 politicians in the top 10, including the top 4 in the entire survey – the aforementioned Pelosi, Reid, Baucus, plus of course, the President.

So it is no surprise that PPACA - "health care reform" signed by the President - is a political instrument rather than medical reform; is power-driven rather than public health driven; will spend a trillion dollars, not save a trillion dollars; and creates bureaucracy but does not create ways to help physicians and hospitals reduce their cost. As Pelosi predicted, we are finding out what is in this law. And we are rightly appalled.

IMO, too few doctors have been constructively engaged in the health policy debate. As a result, the nation relied on the wrong “doctors” - - who made the wrong diagnoses and wrote the wrong prescriptions. In these circumstances, the patient's prognosis ain't all that rosy.

Flooding the Zone

Comedienne Kathleen Madigan has a cute line about a farmer whose home along the banks of the Mississippi has been flooded (again): "And he's just as surprised this year as he was last year!"

Which also summarizes the folks who run the National Flood Insurance Program:

"In Wilkinson County, Miss., a home has been flooded 34 times since 1978 ... an insurer has paid claims every time, required no flood proofing, never raised premiums after a claim and vowed to continue insuring the house. Forever."

The home's valued at just under $70,000, but all those claims total over $660,000. It's been paid-for ten-times over.

By what brain-damaged insurance company, you ask?

The clueless folks at the McPaper want you to think it was "[t]he federal government."

But you and I know better: the government has no money. The correct answer is: thee and me.

The rocket surgeons at FEMA "manage" the National Flood Insurance Program (NFIP). This isn't our first brush with this brain-trust, either. As Bob wrote about NFIP almost 2 years ago:

"If you crash your car repeatedly, you can count on your insurance premium shooting up. Crash often enough and your insurer will drop you. But there's a special kind of insurance that doesn't punish you for having the same accident over and over again. And here's the punch line: It's a government program that's already left tax-payers like you on the hook for $17 billion—and counting."

The problem is that, although the goal is to be self-sustaining, the agency continues to run "deeply in the red." How deeply? How about almost $20 billion in crimson? But FEMA/NFIP isn't alone. As we also mentioned almost 3 years ago, Florida's "high risk" carrier, Citizens Property Insurance (a wholly owned subsidiary of the unfortunately non-profit Citizens of the State of Florida), has much the same structure, and (not surprisingly) similar results:

"[O]ver $400 billion (yes, billion with a "b") in liabilities ... [and] something like $3 billion in premiums."

Ooops.

These dollars are dwarfed, of course, by Hurricane ObamaCare©, which is slated to cost in the trillions, but serve as stark and sobering examples of government-run "insurance" programs which eschew risk for votes. We know that there are going to be at least a handful of hurricanes each season, and can infer, with some degree of accuracy, how many will strike land, causing "x" amount of damage. Same with floods. An exact science? No. A pretty good track record of estimates? Yep.

But how do you assess the risk for literally hundreds of millions of Americans - some smokers, some not; some fat, some fit; some healthy, some diabetic - and further, how do you price that risk with any degree of accuracy when you won't even acknowledge that the risk exists?

That is the insurmountable conundrum of ObamaCare©. Well, not "insurmountable," exactly. Feel better?

Take me out to Grand Rounds

This (short) week's Grand Rounds is up at Dinosaur Musings. Make sure to bring along some peanuts and Cracker Jack!

Medicare: Spend $10 Billion to Save $1 Billion

Under Obamacare, the folks in Washington are given the task of finding ways to make health care more affordable. Medicare Chief Donald Berwick, a fan of Britain's failing National Health Service, has been given $10 billion to find new ways to save dollars spent under the Medicare system. “I am romantic about the NHS,’’ Berwick said in the 2008 speech marking the 60th anniversary of England’s National Health Service. “I love it.’’

Berwick is using a tool that Congress included in the new health care law: an innovation center with $10 billion to spend over the next decade in a quest for the best ways of improving care and reducing costs.

The launch of the test sites by the end of 2011 is just a first step in changing the fundamental ways the government pays physicians and hospitals. Over 10 years, the innovation center’s work is expected to save $1.3 billion

Perhaps it is just me, but the math doesn't seem to work out.

But there is a potential silver lining here.

Unless he can win over some GOP senators, who voted uniformly against the health care law, Berwick won’t be able to win a 60-vote confirmation in the Senate and will be forced to leave office when his recess appointment expires at the end of 2011.

This guy is dangerous. Let's hope he does even less damage to Medicare over the next year than Obama has to the economy in less than 2 years.

“You can have all the authority in the law, but if you don’t have support in Congress, you are going to have trouble with your funding, you are going to have trouble with the way you are treated at hearings,’’ said a Berwick supporter, James Roosevelt Jr., chief executive of the Tufts Health Plan

Same can be said for Obamacrap.

Ask about information on Medicare supplement plans in Georgia.

Cut Me a (Tax) Break!

Last month, we debunked an email which claims that folks will have to pay taxes on their group health benefits starting next year. That is patently false.

But it is true that new reporting requirements go into effect in 2011, and that's where I "missed the mark:"

"First, the relevant portion of Obamacare© doesn't take effect until 2018.

Second, only so-called "Cadillac plans" are subject to this provision."

Wrong, Henry.

Bob Graboyes, Senior Healthcare Advisor for the National Federation of Independent Business (NFIB), points out to me (in email) that:

1) The W-2 reporting provision does kick in in 2012. (That is, the form filed in 2012 on 2011 wages.) However, we believe the provision really starts earlier. If someone leaves his job in 2011, the employer must provide the W-2 – with the added info – within a few weeks of the employee’s departure.

2) It applies to all health insurance benefits, and not just to Cadillac plans. To my knowledge, there’s no difference in the reporting of Cadillac plan benefits and other insurance benefits.

Further research confirmed Bob's points. The reason that this is so important is that all of these additional requirements increase the actual cost of sponsoring a group health insurance plan (as if rate increases alone aren't onerous enough).

Now, I did get the third point correct: benefits aren't taxable - yet. But two outta three is not acceptable, so I'll dock myself a days blog-pay.

As long as we're on the subject of how ObamaCare© will increase the cost of doing business, it's worth noting another cringe-worthy provision that's been under the radar (but won't be for long), which "mandates that all businesses, tax-exempt organizations, and federal, state and local government entities will be required to issue IRS Form 1099 to vendors from which they purchase goods totaling $600 or more during a calendar year beginning in 2012."

Currently, the threshold is $2000, certainly a more reasonable number. This is particularly problematic for small businesses, which may have a number of vendors with whom they spend just at or above $600 (think business cards and letterhead, a new laser printer or fuel). Rotsa ruck, by the way, prying loose Office Depot's or BP's EIN (Employer Identification Number) in order to comply.

Now, one might think that accountant-types would view this new requirement (and the billable hours that would accrue as a result of it) as a major windfall, but one would be wrong. Noted tax-blogger Joe Kristan sets the record straight:

"Unless you are in the write-up business (basically, bookkeeper-for-hire), it’s an unmitigated nightmare. It generates an enormous compliance burden – for us, as well as for our clients – while generating paper that we will ignore in preparing business returns. The 1099s are cash basis, while most businesses are accrual, so matching the 1099s is pretty much impossible."

Of course, one might be tempted to believe that "hey, government-types are smart, surely they know what they're doing."

And again, one would be wrong. Christina Romer, the outgoing chairperson of the President's Council of Economic Advisers, said on Wednesday (September 1st) that:

"[s]he had no idea how bad the economic collapse would be. She still doesn't understand exactly why it was so bad. The response to the collapse was inadequate. And she doesn't have much of an idea about how to fix things."

And these are the kinds of people now in charge of our health care.

Is there a pill for that?

Health Insurance Designed by Politicians

What does the Capitol Visitors Center and Obamacare have in common?

The CVC was supposed to make it easier for visitors to access Washington landmarks and make their visit more pleasant.

The CVC originally was supposed to take 4 years to build at a budget of $71 million. When completed it took 8 years and cost $621 million.

Obamacrap is supposed to make health insurance more affordable and accessible to everyone, regardless of their age, gender or existing medical conditions.

The initial estimate is the cost of Obamacrap will be less than $1 trillion over 10 years but those figures are already fading in the light of day as the Congressional Budget Office and others are wading through the bill . . . after the fact of course. The final cost will not be known for years.

This makes one wonder, if Washington can't even get a construction project to come in on time and within budget, how can we expect them to do any better with health care?

Your Wyden Waffles Post

Apparently, Sen Ron Wyden (D-IHOP) agrees with us that the so-called Individual Mandate is evil. Previously, of course, he was all for it; in fact, it was a centerpiece of his own "Healthy Americans Act." But that was then, and this is now:

"Last week Mr. Wyden sent a letter to Oregon health authority director Bruce Goldberg, encouraging the state to seek a waiver from certain ObamaCare rules ... One little-known provision of the bill allows states to opt out [of the mandate] ... I believe that the heart of real health reform is affordability and not mandates..."

Last year, for example, we reported that he was not only "on board" with the mandate, but that it was integral to his proposal. This despite the fact that, as we pointed out at the time (and which has since been validated):

"[I]f one is required to buy insurance, it certainly follows that the market will be forced to offer it to them. And that, of course, sets up a whole 'nother set of issues."

Hence, ObamaCare©.

Cavalcade of Risk #113: Call for Submissions

David Williams hosts next week's Cavalcade of Risk. Submissions are due this Monday (the 6th). Please remember to include:

■ Your blog's url
■ Your post's url
■ The post's trackback URL (if available)
■ A (brief) summary of the post

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

You can submit your post via Blog Carnival or email.

Health Wonk Review: In the Here and Now

I continue to be impressed with the quality of wonkery displayed by the folks whose submissions you'll see below. Looking back at the first 'Review I ever hosted, I was struck by how many wonk-bloggers [ed: is that even a word?] have left the 'sphere, but quite pleased to see names I recognize as still active: the Health Business Blog's David Williams, my favorite econ-blogger Jason Shafrin, and Workers Comp guru Jon Coppelman (all of whom appear in this edition, as well). I also noticed how short that review really was. I'm all for brevity when appropriate, but there's also no shame in piling on, especially when you read this week's entries.

In keeping with my newfound penchant for minimalism, posts appear in order of submission:

■ Rita Schwab has the sad tale - and important lesson - of little Taylee Blischke, who died at the hands of survived despite the efforts of incompetent, and unrepentant, physicians.

■ Bradley Flansbaum (aka The Hospitalist Leader) shares his comparison of The Great Emancipator and (what we at IB call) ObamaCare©. Guess who wins?

■ Peggy Salvatore uses an old (but timely!) joke to demonstrate the folly of government-supported EHR initiatives.

■ Rich Elmore at Healthcare Technology News reports on the Tiger Team on security and privacy recommendations regarding the handling of personally identifiable health information. Important stuff.

■ Joanne Kenen's post is about how CareOregon, a Medicaid managed-care plan, has created patient-centered medical homes and adapted to its own population a successful care coordination program for patients with multiple and/or complex chronic disease. Interesting.

■ HWR co-founder Joe Paduda weighs in on the cost of voluntarily forgoing necessary health care. While I disagree with his reasoning (high deductibles and/or co-pays are to blame), he makes a valid point:: delaying or forgoing primary care will increase future health care costs

■ Uber-wonk Dr Roy Poses posits that maybe - just maybe - having health care leaders' incentives actually aligned with patients' and the public's needs, and not so large as to elevate the leaders into the "Superclass," might work out better in the long run.

■ My favorite health care economist - Jason Shafrin - examines key provisions of ObamaCare@ from (you guessed it!) an economist's viewpoint.

■ Boston's Tinker Ready talks about "e-patient" Dave, and the contrarian's view of "positive thinking."

■ What does Joe's suddenly accelerating Camry have to do with HWR? Well, you'll have to click through to newcomer Michelle Woods' post on HIT (Health Information Tech).

■ Austin Frakt, The Incidental Economist, believes that Rep. Ryan's plan for Medicare is unlikely to control costs because it is too much like the current [ed: but soon to be "late"] Medicare Advantage program.

■ Maggie Mahar takes a look at former HCA honcho - and current Florida gubernatorial candidate - Rick Scott and finds him wanting.

■ Ken Terry sings the Motown Blues, taking to task the waste of dollars being thrown at Detroit's hospitals. Stop, in the name of...common sense!

■ Workers Comp Insider's Jon Coppelman reports on the case of Americans with Disabilities versus the Occupational Safety and Health Administration. Who wins? Guess you'll have to read the post.

■ Jay Norris, of the Colorado Health Insurance Insider blog, writes about the newly-created Early Retiree Reinsurance Program, which enables federal funding to help pay for retirees’ health insurance.

■ Avik Roy, of The Apothecary (and a featured NRO blogger, as well), takes the contrarian viewpoint in defending the FDA's position in the recent Avastin kerfluffle.

■ Over at the Health Access Blog, Anthony Wright points out that California was the first state in the nation to have its legislature pass a bill to set up a health insurance exchange under health reform.

■ Dr Jaans Sidorov compares and contrasts this Administration's most recent spins with academic writings that "say it ain't so."

■ The eponymous John Goodman's Health Policy Blog reports that the the NCPA [ed: National Center for Policy Analysis] has released an evenhanded consumer’s guide to health care reform, focusing on both new benefits and costs, in a helpful Q&A format.

■ At the Health Affairs Blog, Michael O’Grady and Jennifer Baxendell Young propose an automatic adjustment mechanism in which federal Medicaid financing would increase for states suffering economic hardship, without the need for special Congressional legislation. Left unanswered: why only Michael's picture is on the post.

■ The Health Business Blog's David Williams interviews one of my favorite med-bloggers: Dr Evan Falchuk. What makes him a fave? Here's a sample: "We connect with people because we’re talking about real stuff." Trust me, this guy is important.

■ And finally, our own Bob Vineyard puts the smackdown on all the "wonderful" changes promised by ObamaCare©, including the fact that we now have fewer choices at higher costs.

That wraps up this week's episode of Health Wonkery. Please be sure to tune in again on the 16th when Jay's better half, Louise Norris, hosts the next edition.

Mid-Week ObamaCare© Implementation Update

First up (and as previously noted but now confirmed), Aetna will no longer write so-called "child-only" plans. These have been useful in, for example, divorce situations and some group-based scenarios, and are now off the table insofar as Aetna's individual medical plans are concerned. While this may not seem to be a big deal, it's a further erosion in the choices available in the (previously) open market.

This change is effective October 1st for Kentucky and Indiana, and November 1st for Ohio.

If you're tuning in late, these changes are a direct result of ObamaCare©'s careless and destructive assaults on basic risk management principles. For example, the new regs prohibit underwriting on "children" 19 years and under, which, according to the folks at Aetna, "have the potential to significantly increase the cost of premiums and make coverage unaffordable." Quite so.

On the other hand, Medical Mutual is poised to pick up at least a few of Aetna's minors:

"Medical Mutual will continue to accept applications and provide quotes for plans with effective dates of September 23, 2010, through October 31, 2010, for children under the age of 19 (either as a stand-alone product or as part of a family)."

Of course, no one really knows what's going to happen going forward from October. As the folks at MMO told us in email, "the Company reserves the right to withhold final approval based on clarification of state and federal regulations on individual plans or not issue a policy at all."

How's that for Hope and Change?

UPDATE: And this just in from United Healthcare's Golden Rule:

"In previous communications, we had informed you of an impending change to the coverage effective date that would take place on September 1, 2010. Due to broker feedback, this date has been moved to September 6, 2010."

Interesting that they received, and acceded to, what must have been fairly intense pressure from agents.

So beginning with new applications received on or after next Monday:

"Coverage effective dates for Golden Rule renewable health plans will be the later of 30 days after an application is received or the date requested by the customer (but no greater than 60 days)."

Glad they cleared that up.

Health Insurance Bridge to Nowhere

The folks in Washington that gave us the "bridge to nowhere" have done it again, this time with health insurance. ERRP (Early Retirement Reinsurance Program) as announced by HHS is supposed to make it easier for employers to provide health insurance to early retirees. Congress authorized $5 billion of money they did not have to fund this program until 2014.

Most expect that will not be enough to support the program, but then, what else is new? According to Sunshine News:

Sixty-nine Florida businesses and government entities have been accepted into a new federal program designed to help employers and unions maintain health coverage for early retirees not yet eligible for Medicare.

The Early Retiree Reinsurance Program is designed to be a $5 billion bridge to the new federally mandated health insurance exchanges that begin in 2014.

But U.S. Rep. Bill Posey said the program looks more like a shell game, and it could come up short financially.

Rep. Posey is not the only one with this concern.

"The timing of this announcement by the administration is interesting because earlier this month Medicare trustees issued a report noting on page 183 that the new health-care law will result in nearly 6 million retirees losing their prescription drug coverage from their former employers -- a fact that went largely unreported," said Posey, R-Cocoa.

Posey added, "Nowhere in today’s HHS release is there a reference to HHS’ own warning to retirees that this program is largely unfunded -- by perhaps tens of billions of dollars.

Probably just an oversight . . .

The White House said immediate action was needed to bridge the health-care gap for early retirees, noting that the percentage of large firms providing retiree coverage dropped from 66 percent in 1988 to 29 percent in 2009.

Does the White House actually believe they can magically reverse a trend of the last 20 years when they can't reverse the unemployment and foreclosure trend of the last 2 years? Or do they only care if the voters believe this garbage?

The folks at EBRI, who have a pretty good handle on health insurance costs, have estimated the money for ERRP will run out in 2 years.

Just another stupid government trick from the folks who brought you Obamacrap.