Monday, June 25, 2012

Will SCOTUS striking down ACA cause for reflection?

It amazes me how often I see comments like this from Jodi Kantor of the NY Times:


 The article in whole is about SCOTUS striking down all or part of Obama's Affordable Care Act, something these same people said was impossible. To question the constitutionality of ACA was dismissed and ridiculed; yet here we are today widely expecting just that to happen.

When will people like Jodi realize they are idiots, the problem is not the aggressive courts or divisive politics? They just don't understand healthcare or the law and thus tend to get analysis wrong. Just as the ACA was always unconstitutional, Death Panels were always a legitimate concern, Jodi just isn't intelligent enough to understand why.

We can only hope that people like Jodi Kantor take some time after the court ruling and reflect on why, once again, they got it wrong and make the connection to their lack of talent. Jodi could have had a perfectly accurate article if she had left that partial sentence out, yet for some reason they always feel compelled to over reach and show just how little they know.

Friday, June 22, 2012

Health Wonk Review: SCOTUS on hold edition

FoIB and HWR founder Joe Paduda hosts this week's assortment of posts on health care policy and polity. As usual, it's chock full of interesting, sometimes provocative posts.

Do check it out.

Cavalcade of Risk #160: Call for submissions

Next week's Cavalcade of Risk will be at Jay and Louise's place. Entries are due by Monday (the 25th).

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

You'll need to provide:

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

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

Thanks!

Thursday, June 21, 2012

Propaganda Never Dies

Commenting on another blog I came across an all too familiar problem:
Ignoring the debatable opinion in the first paragraph, it is the highlighted part that is really the problem. Since HIPAA passed in 1996 small groups are not only guaranteed issued but the rates are capped meaning sick groups are subsidized by healthier groups. As Kaiser shows all 57 States have Guarantee issue up to 50 lives; the only variable is does it start at one or two. Husband and wife is two, so no matter what state she lives in they are guaranteed insurance.

Maybe this is Darwin's way to prevent people from starting businesses that shouldn't, but it is concerning that people with these misbeliefs are voting. If someone wants to start a business so badly but is stopped by a problem that doesn't exist to what measure will they go to solve this imaginary problem?

MLR vs SCOTUS: Under the radar

As we wait breathlessly for the SCOTUS decision on ObamneyCare©, I'll engage in some completely baseless (but fun) speculation. We've written extensively on the stupidity that is MLR (Medical Loss Ratio), and FoIB Holly R sent us this link on the latest:

"Health insurance plans owe $1.1 billion in rebates ... Millions of consumers and businesses will receive $1.1 billion in rebates this summer from health insurance plans that failed to meet a requirement of the new health-care law"

Thus sayeth HHS Secretary Shecantbeserious.

As an aside, do "professional journalists" and/or "editors" actually proofread the stuff they spit out? It would appear not, since they seem to be saying that Madame Secretary envisions checks totaling multiples of billions of dollars ("Millions of consumers" will be getting checks for "$1.1 billion"). On the other hand, given the current regime, maybe that's just the next Spendulus.

Compounding this idiocy is that Madame Secretary and her minions have no idea how many rebates will be "earned," let alone the total dollar value. I guess we'll have to send out the checks to see how many - and how much - they are.

But here's the piece that has me chuckling: the naysayers claim that if SCOTUS scuttles ObamneyCare©, “adult children” will be booted off parents’ insurance, policies will be rescinded willy-nilly, and other assorted clamors of doom.

So here's my question: in that scenario, wouldn't those who received MLR-generated rebates have to return them to the carrier(s)? And yes, I'm quite serious. Sauce for the goose, and all that.

The "Other" Mandate: Not Just for Catholics

While it might be tempting to write off objections to the mandating of coverage for convenience items birth control and abortion as a purely Catholic issue, it's really not:

"Many Protestant institutions are also trying to overturn the compromise that coerces private religious institutions to fund health insurers who can provide beneficiaries with abortion-inducing drugs"

Cans of worms....

Wednesday, June 20, 2012

So what?

FoIB Holly R tips us to this shocker from The Hill:

"More than 3 million young adults have been able to stay on their parents' insurance plans because of [ObamneyCare©]."

One of the provisions allows "adult children" (see also: "jumbo shrimp") to stay on their parents' health insurance plan until they're 27 (29 in Ohio). This is also a case of "bootstrapping:" ObamneyCare© did away with individual policies for actual children in favor of those who can actually fend for themselves.

Theoretically, anyway.

It's a fairly innocuous piece of this train wreck initiative, but it's also expensive for those who choose to take advantage of it: in most cases, the cost of the rider is far greater than an individual policy would be (particularly if the group plan is the typical co-pay arrangement).

But of course we can't expect The Hill to report on that.

LTCi: Greater Need, Fewer Choices

Jim Reynolds runs Caring Companion Home Care in Concord, Massachusetts. The 20 year old company provides home health care services, and Mr Reynolds has a message for those of us who sell Long Term Care insurance (LTCi):

"You're doing a good job; keep at it."

That's the good news.

The bad news is that, according to the National Association for Home Care & Hospice, some "7.6 million Americans received formal home health care and related services with a total value of about $58 billion in 2007;" by now, that number is likely to have grown substantially. The problem, of course, is that this care isn't free, and Medicare pays only a part (if any at all).

That's where LTCi comes in:

"When asked during an interview about how many of the families can use LTCI coverage to pay for the care, he thinks a bit, then says the percentage might be "10% to 10%." Then he thinks a bit more and says, "Closer to 10 percent.... It's not near as high as it ought to be."

And therein lies the rub: just as we see the need for this kind of plan peaking, its availability is on the decline:

"Shopping for long-term-care insurance? You should expect higher costs and a tougher approval process as a growing number of household-name insurers quit selling the policies."

As Bob noted this spring, "Prudential has announced they will be withdrawing from the individual long term care market." Met and Unum had already bailed on the individual LTCi market, and other carriers are now tightening their belts.

Those carriers "toughing it out" are making significant changes (aka reductions) in their product offerings. The latest comes from MassMutual. Although it's unlikely that they'll completely exit this market anytime soon, they're making some pretty significant changes. From email I received this morning:
"MassM announced ... that they are eliminating/limiting the following LTC options:

*Lifetime and 10-year benefit periods
*Full Return of Premium on Death and Return of Premium on Death riders
*All limited premium-payment options (10-year, paid-up at age 65 and discounted renewals
*Limiting the Shared Care rider to 2-3 year benefit periods
Granted, these tend to be the more expensive, low-volume offerings, but they indicate that the carrier is taking the shrinking market very seriously. That is, when there are fewer carriers even offering LTCi, "no carrier wants to be out on an island offering riders/benefits no one else does because it attracts an inordinate amount of business and remaining in balance is critical to LTC success."

Indeed.

So what to do? Well, if you have a need for this kind of coverage, then you'd best be acting sooner rather than later in getting it.

[Hat Tip: MM's Jeff M]

Tuesday, June 19, 2012

MSM Plays Captain Obvious

From the "No Kidding, Sherlock" Department:



Wait, what??

Wasn't this train wreck "reform" going to guarantee that everyone would be insured while cutting premiums 3000 percent? Is the Associated Press, that well-known conservative mouthpiece, trying to tell us us it was all a big lie?

Hmmm.

Who, exactly, would still be uninsured among us?

Well, that would be "illegal immigrants and those who can't afford to pay out-of-pocket for health insurance."

Very interesting.

Why would illegals care about insurance in the first place? After all, they already get free care courtesy of the states. And of course, those who "can't afford" the premiums would be eligible for expanded Medicaid coverage and tax credits.

Sheesh.

[Hat Tip: FoIB Holly R]

Death by MVNHS© [UPDATED]

Last time we looked, the Much Vaunted National Health System© was busy killing off 78 year old bladder cancer patient Kenneth Ward. Lest Mr Ward feel left out, here's news that he's far from alone:


This is nothing new, of course: last year, we noted that "[h]ip replacements, cataract surgery and tonsil removal are among operations now being rationed in a bid to save the NHS money." Still, these new numbers show why a single-payer system can never really sustain itself. As Bob mentioned last week, "true single payer eliminates private industry. The government decides how much to pay the provider and what services are expected. The British NHS works like this" and the fact that 90% of British hospitals engage in health care rationing of this magnitude simply underscore his point.

Defenders of single payer like to point out that they're more cost effective than a free-market model. Of course, it's easy to be cost-effective when providers "are denying treatment despite guidance from the National Institute for Health and Clinical Excellence that patients should receive it."

Fewer Choices, Higher Costs: ObamneyCare©

Starting a new business is challenging enough, but navigating the maze of group insurance adds a whole new dimension. A frequent roadblock is the issue-and-participation requirement. This is a carrier rule based on the number of employees and how many opt for the group plan. Carriers justify this based on the concept of adverse selection (only sick people would sign up).

I recently met with the owners of a new company, and we quickly established that they'd be ineligible for a group plan based on participation requirements. Looking for alternatives, we wondered if a "stand-alone" Health Reimbursement Arrangement (HRA) would do the trick.

A stand-alone HRA is basically a health care debit card funded by the employer. A typical design might be $500 per year per employee; the first $500 of one's medical expenses would essentially be borne by the employer. Unlike a qualified Health Savings Account (HSA), there was no requirement for an underlying health insurance plan.

We thought this would be a great option in this case: it would mean that at least some of an employee's medical expenses could be shifted off his or her shoulders.

Alas, ObamneyCare© has ruled this out:

"Health care reform requires most group health plans to provide minimum annual levels of coverage for “essential health benefits”  ... In 2014 group health plans will have to provide unlimited annual benefits for “essential health benefits” ... The government has ruled that most HRAs are considered group health plans for these purposes."

In other words, stand-alone plans would themselves have to be "unlimited," a rather daunting prospect for any business. Needless to say, this plan was a no-go.

So of course we can see how ObamneyCare© has increased choices and lowered costs across the board.

Or not.

[Hat Tip: FoIB Alissa C]

Monday, June 18, 2012

ObamneyCare© SCOTUS Meter... [UPDATED]

For those waiting with bated breath for a decision on the ObamneyCare© case, take a deep breath and relax (for the nonce):


Um....

UPDATE: Something to ponder while we're waiting. FoIB (and Cato Institute Director of Health Policy) Michael Cannon shares his thoughts on the latest ObameyCare
© "bug:"

"Under the statute as written, if Congress fails to repeal IPAB [aka Death Panels] in 2017, then as of 2020 Congress will have absolutely zero ability to block or amend the laws that IPAB writes, and zero power to affect the Secretary’s implementation of those laws."

Michael, I'd observe that the folks behind this train wreck initiative would call that a feature, not a bug.

MVNHS© Customer Satisfaction takes a hit

As we've long noted, actual care delivery under the Much Vaunted National Health System© has been - at best - substandard. But don't just take our word for it:

"A new survey carried out by the King’s Fund health charity ... indicates that the general public’s levels of satisfaction with the running of the NHS have seen a marked drop. The number of people who were satisfied ... fell significantly to 58% in 2011."

Ooopsies.

MVNHS© leadership observed that these findings indicated that Brits are “worried and confused.” No kidding: they're worried because they see precisely how such systems fail to perform, and they're confused by the fact that it's still touted by the ruling class as terrific.

Regular readers already know that victims of participants in the MVNHS© can buy health insurance that can help pay for private care. The catch, which may be new to some, is that this service is available only to those on a waiting list.

Fortunately, this apparently comprises the majority of patients.

"We have to change and we know that"


The Supreme Court decision on the Affordable Care Act is expected the week of June 25th, so the chatter is picking up again.   Kaiser Health News has an interesting article here that includes this comment:

“We have to change and we know that,” said Ken Raske, president and CEO of the Greater New York Hospital Association, which represents 250 hospitals and medical care facilities. “But it’s easier if you’re going to build the building to have the shovels and picks and the hammer and nails than trying to dig it out with your hands. That’s what the Affordable Health Care Act is.”

I think this suggests an attitude within the hospital industry that is worth thinking about.  Although Raske concedes hospitals have a business imperative to change, he warns they might have to slow down, unless government provides “shovels and picks and the hammer and nails”.  Since the Federales cannot supply these literal tools to the hospital industry I think it’s clear Raske is talking about money.  

The attitude is that, unless the government pays for change, change will be slow or nonexistent.  I just don’t accept that attitude.  Do you?

When other, non-hospital businesses have to change and they know it, what do they do?  Do they rely on their own resources?  Or do they rely first on getting government money - and tell their customers that they might not change – or might change slowly – if they don’t get it?  You know the answer.

Short version of the above - News flash:  the hospital industry says it must have more money from the government or it might slow down efforts to serve its patients better.

Health & Chocolate Down Under

"[R]esearchers at Monash University have discovered that eating a 100g [about 3.5 oz] bar of dark chocolate a day (yes, the whole seductive, delicious, mouthwatering brown slab, from each melting cube to the last sticky crumb) is one way to avoid cardiovascular disease."
This magic elixir apparently reduces both blood pressure and cholesterol. Obviously, one must avoid over-consumption, but it sounds like a great way to eat healthy.

Friday, June 15, 2012

IRS: More ObamaBux©

Although we often mock HHS Secretary Shecantbeserious (and justifiably so), it's important to remember that the really big guns behind ObamneyCare© belong to the IRS, and the revenuers don't work cheap:

"The Internal Revenue Service is expected to use $881 million of taxpayers’ money to implement the first four years of Obamacare, including about $500 million that [HHS Secretary Shecantbeserious] diverted to the agency"

Remember, though, that this train-wreck reform package is going to save us buckets of cash.

Rubbing salt in the wound, we also need to be aware of this little "glitch:"

"[T]he Centers for Medicare & Medicaid Services (CMS) are predicting that health care spending will increase about 4% for the next couple of years."

Meh, that's not so bad.

Wait, what?

"Spending could then jump about 7% in 2014, when coverage expansion programs created by [ObamneyCare©] are supposed to start, the CMS analysts said"

Oh, well, it's only money, right?

Thursday, June 14, 2012

MassCare Uh-oh

It will come as no surprise to regular readers of IB, but MassCare (famous for killing health insurance competition and increasing premiums in the Bay State) seems to be a gold-mine for folks gaming the system:

"Illegal aliens, out-of-staters and others who failed to produce proof of Massachusetts residency drained $118 million from the pool of cash the state uses to reimburse hospitals and clinics that care for the poor"

Ooopsies.

As we noted last Fall, Bay Staters were already on the hook to the tune of $93 billion for illegals' health care. As State Rep James Lyons points out:

"If you open a business in the commonwealth, you’ve got to provide documentation of where you live and what the business is ... If we’re providing benefits, all I’m suggesting we do is level the playing field. Don’t just give benefits out if we’re not requiring documentation.”

Yeah, rotsa ruck with that.

Maggie explains why we are all worse-informed

In her propagandizing for ACA (hope they pay her for all the hard work she does), Maggie Mahar had this to say in regards to State's not setting up exchanges;
"Tea Partiers celebrate such reports as a sign that health care reform is toast. Better-informed conservatives understand that even if states don’t create exchanges, the federal government will come in and do it for them. The law is very clear on this point."
If you're the governor of any State but ND, WI or AK you probably have a budget deficit, one that is getting worse, not better. You can spend tens of millions up front, or more, to create an exchange that will then have to be staffed and maintained at the cost of tens of millions of tax dollars. Or you can do nothing and someone will do it for free....that second option doesn't sound so bad.

The real question is why is government spending even a penny on this. There have been numerous exchanges done in the past by private industry (Cal Choice for example). These have been paid for by private capital and maintained by private capital. Private industry also has a much better track record - see my post from a few days ago - with getting such programs to actually work.

There is no shortage of private companies that would be more then willing to create these at no cost to the taxpayer, and do a much better job at it. NAHU would be a great sponsor of exchanges, for example. It is also important that we have competition amongst multiple exchanges, something that tends not to happen when competing against the government.

Wednesday, June 13, 2012

Stupid Carrier Terminology

[Warning: inside baseball-type rant ahead]

Renewals happen. Specifically, health insurance rates are generally fixed for a year at a time. At the end of the year, rates go up (yes, theoretically they could stay the same or go down, but how often does that happen?), and one is usually given the option to make plan changes that mitigate the increase. These are typically along the lines of increasing deductibles or co-insurance percentages, or dropping optional prescription benefits and the like.

Not exactly rocket surgery.

These options are often included with the renewal letter; sometimes one must request them from the carrier. Regardless of how they're obtained, they'll require no additional underwriting (since one is actually reducing the carrier's exposure).

So far, so good.

Here's my beef: Anthem calls these options "downgrades."

How stupid is that?!

For better or worse, Anthem gets a major share of my individual medical business (and truthfully, aside from this particular aggravation, they're actually a decent enough carrier). It just ticks me off to no end to begin conversations with clients by telling them they can "downgrade" their plan.

Who the heck wants to downgrade anything?

This is not a new phenomenon with Anthem, it's just hit a boiling point for me: why would you risk alienating your own customers by implying substandard coverage?

It's not like there aren't perfectly good alternatives: plan adjustment, design change, anything neutral or (heaven forfend!) positive. But telling clients that they're being "downgraded" hurts Anthem's own image, while adding nothing of value to the process.

Sheesh!

TravelMed Apps

So you're taking that long-awaited cruise. Or flying to Italy for a week in the Tuscan sun. Or perhaps you're finally taking that ride on the Orient Express. Problem is, you have a few pills you take every morning, maybe a couple others at bedtime.

Or perhaps you have a more extensive health history, and worry about needing your medical records at a moment's notice.

Yeah, there's an app for that:

"Travelers can tap into technology before the trip begins, by storing information that can help ensure the right care is delivered if health issues crop up."

Everything from your most recent chest x-rays to pill and injection reminders can be loaded (or accessed) on your smartphone. For those tech-averse among us, there are also paper-based forms (even laminated cards with your info) that you can download, print-out and carry with you.

And for those who fret that their portable medical apparatus might be a problem, what with stricter luggage allowances, the TSA has a helpful site that explains how items like CPAP machines are exempt.

There's even an emergency care provider locator app available for folks who find themelves in unfamiliar surroundings while sporting a broken limb or major chest pains.

Pretty cool New World, indeed.

[Hat Tip: FoIB Holly R]

Cavalcade of Risk #159: The Early Edition

CavRisk veteran My Wealth Builder hosts this week's roundup of risk-related posts. MWB does a terrific job of keeping things on-track, with a short but powerful collection.

We're starting to schedule Fall Cavs. Just drop us a line to snag yours.

Monday, June 11, 2012

What could possibly go wrong

Exchanges, either state or federal, are supposed to be one of the transformative benefits of PPACA. A highly automated, uber-efficient insurance buying experience brought to us by those mavens of technology: government. Recent stories like this has we wondering how the exchange delivered will measure up to the one promised.

From Oregon:

"Choose easy! The woman who used TurboTax to falsely claim a $2.1MILLION tax refund and went on a spending spree until she was caught

...Due to the size of the refund, her electronic claims was examined by several people within the Oregon Revenue Department. Incredibly, they approved the payout and Reyes was sent a visa card ... The revenue department processes about $7billion in tax returns each year on computer systems designed in the 1980s."
Oregon is only one of numerous states that tried and failed to upgrade antiquated computer systems. Most states are running Medicaid systems that are just as bad or worse. No private company could stay in business with the software systems the states use. And when they finally do attempt to upgrade they go tens or hundreds of million over budget and often times fail completely.

From Ohio:
"To accommodate the eligibility changes, health officials are seeking federal support to help replace a more than 30-year-old computer system that frequently erroneously denies Medicaid eligibility and causes a huge administrative burden. "The system is so old that the county case workers have to go in and modify the answer based on information they know, but that the system can't accept"
If the exchanges do stay in place after the SCOTUS ruling we better get use to them, there is a good chance we will be using the exact same system for 20-30 years, in-spite of what technology advances.

Friday, June 08, 2012

Backs + Wash: Some Assembly Required

For anyone still harboring delusions about the sacred underpinnings of ObmaneyCare©, we bring unwelcome news:

"Central to Mr. Obama’s drive to overhaul the nation’s health care system was an unlikely collaboration with the pharmaceutical industry that forced unappealing trade-offs."

In one fell swoop, importation of less expensive meds was swept off the table, and less expensive alternatives remain verboten. And, of course, it's one more nail in the coffin of "transparency" in the process.

[Hat Tip: FoIB Holly R]

Holocaust Life Claims Update

Last Fall, we reported on the efforts to get Allianz and other insurers to honor the death claims of Holocaust victims' families. Spearheading this effort was Florida Congresswoman Ileana Ros-Lehtinen, who at the time was trying to convince the media to deny commercial time to the carrier.

While I have some issues with her apparent ignorance of how free speech is supposed to work (cf: Citizens United), I certainly applaud her enthusiasm.

Her latest effort to allow victims' families to sue the various insurers is currently stalled in committee:

"That brought dozens of Holocaust survivors, many of whom live in Florida, to Washington on Thursday to urge the House Judiciary Committee to consider legislation that would allow lawsuits to be filed in U.S. courts ... The proposed bipartisan bill ... would give thousands of survivors the right to sue Germany’s Allianz SE, Italy’s Assicurazioni Generali and other major European firms in U.S. courts to recover the value of life insurance policies bought before World War II."

Unfortunately, this looks like an uphill battle, since the current claims process was pretty much set in stone over the course of the three most recent administrations. And it also doesn't help that there's little enthusiasm on the part of Congress for revisiting the issue.

Still, it's a noble cause, and one which doesn't seem to be going quietly into that good night.

Cavalcade of Risk #159: Call for submissions

Next week's Cavalcade of Risk will be at My Wealth Builder's place. Entries are due by Monday (the 11th).

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

You'll need to provide:

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

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

Thanks!

Thursday, June 07, 2012

Thursday Afternoon Link-Fest

From FoIB Jeff M, we learn that Medicaid may be in even more dire straits than we'd imagined:

"West Virginia is peering over the cliff of a Medicaid funding shortfall ... Medicaid goes into FY 2013 with a slight budget surplus, but FY 2014 poses a $236 million shortfall, “which is daunting.”

Now what could possibly be happening in 2014 that would cause this financial earthquake?

Oh, yeah.

■ Next up, the Institute for HealthCare Consumeris​m (IHC) reports that consumer-centric health plans (aka High Deductible Health Plans, or HSA's) could save tens of billions of health care dollars each year. They note a RAND study claiming that "[g]rowth Of Consumer-Directed Health Plans To One-Half Of All Employer-Sponsored Insurance Could Save $57 Billion Annually."

Regular readers know that we're big fans of these kinds of plans, but I have to say that I'm still a bit skeptical of that number. And, since these plans are outlawed under ObamneyCare©, we may never know the truth.

We've written before about "hidden providers" (most recently, here); recently, a local man and his son ran into that particular buzz-saw (metaphoricaly, anyway):

"Steve Mahoney took his youngest son ... to the emergency room at Children’s Medical Center of Dayton after the boy sliced off his fingertip in a door ... no one told Mahoney that the plastic surgeon ... doesn’t accept health insurance."

On the one hand, it's really not the hospital's responsibility (or even ability) to confirm whether or not a particular provider is in-network, or even accepts any insurance. On the other hand, when you're dealing with your young child's missing digit, how likely are you to be considering that at all?

As you'll see in the article, the problem stems in part from EMTALA.

What's EMTALA?

Glad you asked.

And, finally, FoIB Holly R sent us this article on health care alternatives for folks without insurance:

"I’ve gone to a bunch of doctors, and have learned some things along the way about getting health care without health insurance"

Well-written, not preachy, some helpful tips.

Wednesday, June 06, 2012

Astute Carrier Trick

In email this morning, Aetna reported on its experience with the new MLR (Medical Loss Ratio) rules. Aetna claims that, because of its pricing strategies, they're in pretty good shape:

"The reports we filed with [HHS Secretary Shecantbeserious] demonstrate our ability to price appropriately ... Aetna's rebates represent about 0.5 percent of the premiums we collected"

In fact, they claim that most of their insureds won't even see a rebate check.

Good for them (one supposes).

They acknowledge that the increasing cost of health care does, in fact, drive premiums, and that (as Bob has frequently pointed out) lifestyle choices (ie obesity) is a major contributor, as well. Of course, there's the usual sop to "waste and inefficiency" (why is it that no one can ever actually quantify this?).

But what really intrigued me was their answer to the question "is MLR even working?" They must be closet IB readers:

"The rules also unnecessarily increase administrative costs for us and our customers, and could even force insurers out of some markets, reducing competition and limiting choice."

Spot on.

Tuesday, June 05, 2012

Helmets? We don't need no steenkin' helmets! [UPDATED]

Our on-call P&C guru, Bill M, passes along something interesting for our two-wheeler fans. He received this via email from one of his carriers:

"Michigan has a new law that allows motorcyclists to ride without a helmet if they meet certain criteria. One of these is having a minimum $20,000 per person limit of Med Pay. Most motorcyclists will still continue to wear helmets, however, several Michigan agencies have expressed concern about Errors & Omissions if they do not at least contact these insureds and make them aware of the requirements should someone take advantage of the new law change, drive without a helmet and have an accident. Some are encouraging policyholders to increase the limit beyond $20,000."

Let me note first that my brother-in-law the orthopedic surgeon calls then "donorcycles." And that goes double for those who eschew the head gear.

The home office critter who sent Bill the email also advised agents to search online for details, which we did. Turns out, it's more than just the $20k insurance limit:

"Motorcyclists can forgo a helmet if they are at least 21 years old, carry at least an additional $20,000 in medical insurance and have either passed a motorcycle safety course or had their motorcycle endorsement for at least two years. Passengers also must be 21 or older to go helmetless, and there has to be an additional $20,000 in insurance for the passenger"

Probably want to make sure your life insurance is paid up, as well.

UPDATE: From Jeff M, who notes that at least one Wolverine in-the-know doesn't think too highly of this initiative:

"We call it the organ donor enhancement act ... We’ve always had a shortage of donors but expect to see the numbers go way up,” said the emergency room veteran"

But that's just anecdotal, right?

Um, not so much:

"A new report ... finds that the trend towards giving riders the freedom to go helmet-less is resulting in a significant increase in motorcycle fatalities."

On the one hand, it's tempting to just invoke Darwin and move on, but many of these folks aren't killed instantly, and end up costing major health care dollars (perhaps) better spent elsewhere.

Monday, June 04, 2012

And that's why we call it ObamneyCare© [UPDATED & BUMPED]

And not just ObamaCare©:

"...former Bush HHS Secretary Michael Leavitt – the man who, according to Politico, is likely to become Mitt Romney’s chief of staff ... Leavitt has said some relatively positive things about certain elements of Obama’s health reform law ... “We believe that the exchanges are the solution to small business insurance market"

This is the man who would lead a Romney transition team.

UPDATE: In the comments, Mike has a solid rebuttal to my dragging Romney along. One of the great things about the IB crew is that we don't always see eye-to-eye, and I think that gives us an even broader perspective. Here's Mike:

"And that's why we call it ObamneyCare©"

Perhaps that is not being completely fair to Romney.

According to Avik Roy in Forbes this past April:

it is more accurate to say that the federal Affordable Care Act is modeled after the Democratically implemented version of the Massachusetts law, as opposed to the one that Romney had sought.”
Other snippets:
Just prior to the ceremony, Romney’s aides had announced that the Governor would be vetoing several key provisions of the bill, including its employer mandate
In the end, it didn’t matter what Romney thought about the employer mandate. The Democrats controlled 85 percent of the legislature. After the bill-signing ceremony was over, they went back to the State House and overrode each of Romney’s eight vetoes.”
There’s lots more in Roy’s article.  It’s lengthy but well worth reading the whole thing.
From an Anthem email I just received:

"Earlier today, our parent company announced it entered into an agreement to acquire 1-800 CONTACTS"

Oh, goody!

Now, if they'd only pick up PetMeds, we'd be in business.

Oh, you're probably wondering why WellPoint scooped up the contact lens retailer. Well, according to their press release, WP is looking to expand its non-insurance business.

And who can blame them?

Asked and Answered

FoIB Holly R sends us this poser:

"Are we in for a break from health care hikes?"

According to the linked article, "[h]ealth care spending is expected to grow next year by 7.5 percent, which is historically low"

The author cites economic woes and "cost-conscious" patients for this apparent good news.

Unfortunately, the real answer turns out to be less hopeful:

"Ed Fensholt, a compliance specialist at Lockton Companies L.L.C., Kansas City, Mo., said his firm believes that PPACA requirements already are increasing the typical client's health coverage costs about 2% to 3% and adding $1 per employee in health plan tax costs."

So there's the theoretical world (of staff reporters) and the real world (of actual business folks).

Which one are you going to believe?

FSA's meet ObamneyCare©

From email:

"On May 30, 2012, the Internal Revenue Service (IRS) issued a Notice on the new $2500 Limit on Health Care Flexible Spending Accounts (FSAs). The Notice clarifies that this provision of [ObamneyCare©] applies to plans beginning after December 31, 2012 ...

The limit applies on an employee-by-employee basis rather than per household"

Currently, folks can contribute up to $5,000 per household to the health care portion of their Flex Account. Beginning next year, that gets slashed in half (unless one's spouse also has access to an FSA through his/her employer).

Just another ObamneyCare© tax increase.

[Hat Tip: Cigna]

Sunday, June 03, 2012

O, What Fresh Hell is this? Part II


I believe this is still the most recent IRS guidance on taxability of MLR rebates.  The answer is “yes” and “no”.  (What did you expect?  This guidance is from IRS.)

The guidance is in the form of FAQ's - there are 15 of them.  The first one discusses the tax impact on insurance companies that make rebates.  The remaining 14 describe the tax impact on insured persons who receive rebates.  In summary, the Answers to the 14 Questions about individual insured persons are:

2.   NO
3.   YES
4.   YES
5.   NO
6.   NO
7.   YES
8.   NO
9.   NO
10. YES
11. YES
12. YES
13. YES
14. YES

If you are still awake, that’s 8 “yes” answers and 5 “no” answers.

Are we clear?

Fun fun fun boys and girls.

Saturday, June 02, 2012

Outside of the box generic solutions

Rx shortages have now become the norm:
At the Henry Ford Hospital in Detroit, pharmacists are using old-fashioned paper spreadsheets to track their stock of drugs in short supply - a task that takes several hours each day.
Self funded employers should come together and partner with Wal Mart or a mail order facility and form a non-profit, US-based generic pharmaceutical company. This way they can guarantee themselves an affordable supply of generic medications. With a guaranteed market they could have consistent supply runs.

Once that is established then they can aggressively start challenging patents. Instead of the current games of exclusive 6 month periods at inflated prices and years in court with BS legal arguments once a patent expires, they file to make the drug; if the brand manufacturer challenges,  then they all exclude the drug from coverage.

Friday, June 01, 2012

What Fresh Hell is this?

As Mark Twain once said, "Life is just one damned thing after another."

The May 31, 2012 Wall Street Journal contained this tiny article buried on Page B6 that said (subscription required):

“CVS Caremark Corp.'s pharmacy-benefit business is prepared to escalate a campaign against drug-industry coupons that the company says encourage unnecessary use of expensive brand-name drugs.”

CVS Caremark has an obvious interest in promoting generics because of its enormous mail order business, in which dispensing generic drugs is quite profitable.

Oh the other hand, manufacturers make more money from brand-name drugs. So naturally a battle is escalating. But there's more to the story.

The effect of manufacturer’s coupons is that people aren't required to pay the full retail price. The manufacturer is giving a price reduction to the coupon holder. Therefore insurers and self-funded plans could decide their benefit plans will only allow, or cover, the lower price - after the coupon is applied. This would reduce the benefit payable by the plan.

Example:

Say the plan has a brand drug copay of 50%, and say a brand prescription retails at $200. The manufacturer’s coupon is worth $100 (equal to the 50% copay). If manufacturers' advertising suggests their coupons mean prescriptions are “free” that's what people will expect. In this example, they will expect the coupon to pay half the cost, and their insurance to pay the other half. But wait. What if the insurer or self-funded plan says the price the member is required to pay, net of the coupon, is only $100? If that happens, the expense covered by the plan is $100 and insured person's copay is $50. Not zero. Not what people will expect.

That’s still a better deal than 50% of $200 .. . but people expecting to pay nothing won’t get that prescription for free.

Why might insurers and self-funded plans decide to do this? Simple - it reduces their cost - in the example, from $100 to $50. So is this what will happen? We'll soon see.

Fun fun fun boys and girls.

Game on.

Video Friday

Cato's Michael Cannon has been on a tear lately, advocating that states pro-actively shun setting up ObamneyCare© Exchanges. Here, he explains why:



If you've been following the Pioneer Institute's series on the latest MassCare Payment Reform train-wreck efforts, here's Part 3:

End of Life Care: A Conundrum

From email:

"Why Does End-of-Life Care Cost So Much?‏
$33,382 for one hospital stay. $43,711 for the next. And a final $14,022 for the last three days of life. This is the cost of dying in America ... sick people are paying hundreds of thousands of dollars for “comfort care” at the end of their lives. The expensive scans, tests, and treatments that dying patients receive often provide a false hope, and at the end of it, many are surprised to suddenly learn they will still die. The incentives are skewed ... the high cost of staying alive ... and why the notorious “death panels” may be just what patients need."

Having experienced this first-hand, I'm particularly sensitive to the issues involved here. But I'm not the only one: everyone here at IB has been touched by it in some way. So I've asked each of the co-bloggers for their reactions, and would very much appreciate yours, as well - either in the comments or by email:

Bob: The lady is spot on in her assessment.

Problem is, many of us will say it is time to let a loved one go but too often it turns out more like the movies . . . . "Spare no expense. I don't care what it takes, let him live"

Kelley: Back when I was a Social Worker, I worked in an Adolescent Rehab Hospital. My main case load was the diabetic kids, but the other section of the hospital were for children and adolescents who had had life altering injuries which left them as vegetables.

I had a nurse tell me that she would advise her ER nurses not to work so hard to "save" people from catastrophic injuries as the emotional toll and financial costs were simply too much to bear. I recall a brain injured teenager, male, whose only recourse was a nursing home as he was a vegetable, no brain activity. I agree with this woman: doctors are only paid for doing something, not for doing nothing.

Nate: What bothers me is that $33,382 hospital bill probably only cost the hospital $6000 to deliver care. It’s one thing to profit off death but 400% profit margins these people should be outcast of society not pillars of the community.

Mike: Death with dignity - and palliative care - is the idea behind hospice. Not a bad idea. Maybe we should be thinking how to expand the idea so more people can reach death with dignity.

Notice that in the article linked, the author reports that decisions about her father's end of life care were taken away from the family:

"[T]he doctor we had never met before admitted Terence to an advanced-cancer-care ward at the University of Pennsylvania Hospital. And then an entirely new set of doctors took over"

Doctors the family had never met before - strangers - making medical care decisions about her father, instead of her family. Exactly "taking over." Bennett laments that. IMO well she should.

Follow her thought thru another step. If one prefers not to have strangers making the decisions about medical treatment for you or your family members, how much more might one also prefer not to have strangers making the decisions about your or your family member's death ?

Here's an idea. Pick an age - say, 60. Starting at that age, it shall be illegal for anyone to have medical insurance - public or private, individual or group - regardless of ability to pay. And upon attaining that age, each citizen shall be granted a lifetime stipend of $200,000 to use in any manner whatsoever, but with a strong suggestion that it be set aside for future medical care. Beyond that, for citizens above age 60, no more insurance, no more public subsidies of any kind, no welfare, nothing more for medical care.

Now, does that sound kindlier than "death panels?"

Bob: Sure Mike.

Of course you don't have to worry about getting re-elected. Those weenie's in DC can't even agree on making changes that won't impact anyone 55 or older. No way they would offer up your $200k You Bet Your Life plan.

You can make a similar argument for/against premature babies, those with significant birth defects including severe retardation, CP or any number of conditions.

I have known more than a handful of folks with children that are running up $50 - $100k/yr for "maintenance" and these kids will live for years. Poor quality of life, but alive none the less.

Kelley: And here's another thing. The author lumps all charges, hospital and providers into one number. Nate notes that the care would be a certain number, which may be true if the hospital did the care, but the care was done by each different provider, the radiologist reading the cat scans, the PT providing physical therapy, the Hospitalist providing care and diagnoses, so as to be paid, etc. The only providers that cannot bill are the nurses provided by the hospital for care; the hospital bills a facility fee to cover those costs and nurses are very expensive. If you were to take the overhead expenses of all the providers, taking out the hospital-only costs, you will probably find a much more narrow margin, such that the costs are justifiable.

The point is that once you enter the hospital for a terminal condition, all the staff can do is test, not cure, so one must decide if more tests stating the obvious is worth the cost. As the author pointed out, the last hospitalizations resulted in no treatment, only tests and confirmation diagnoses.

Hank: As previously noted, I'm a big fan of Hospice. BUT: Hospice is a choice - not a requirement. So when will HHS Secretary Shecantbeserious announce a "Hospice Mandate?"

There's no question that EOL care needs to somehow be reined in.

My issue is with the idea of an unelected, unaccountable panel of gummint-appointed bureauweenies making that decision.

Mike: Hank, that's exactly my beef as well.

Bill: Is there a solution to the EOL financial problem? As long as some belief systems preach the sanctity of life at any cost, some people will continue to spend other people’s money indefinitely. A healthy body, a dead mind and an irrational hope…those are the cases that become insanely expensive.

Behind the testing, there’s always another question, “Is it really terminal?”

Sometimes, you just don’t know. I had a relative who had an episode of ventricular fibrillation. According to his doctor, less than one out of twenty VFib patients make it to the hospital alive. Of those, a very small percentage survive without substantial neurological damage. He had virtually none. Five years and a pacemaker later, he’s still alive and practicing law. (There’s a bad joke in there somewhere!) With an initial Glasgow score of 6 (aka TFU), would an “efficient” system have spent the $150K to keep him alive? I doubt it.

[Hat Tip: Joyce Tang]