Fear Of Reform or Sphincters Tightening At Insurance Company Boardrooms Across America

WASHINGTON - The health insurance industry offered Tuesday for the first time to curb its controversial practice of charging higher premiums to people with a history of medical problems.

This I will now attribute to my repeated and relentless incendiary remarks posted here on this blog. They, the insurance company corporations and conglomerates, are, finally relenting!

Full story here: Insurers offer to stop charging sick people more

No doubt the momentum in Washington, lead by President Obama, to reform practices by insurance companies that are wasteful and detrimental to patients and employers and that result in decreasing companies in the USA from competing effectively in a global market. That is insurance company bad! Reform good!

In the letter, the two insurance industry groups said their members are willing to “phase out the practice of varying premiums based on health status in the individual market” if all Americans are required to get coverage.

Golly gee, Batman, I wonder why they would do such a thing?

“The offer here is to transition away from risk rating, which is one of the things that makes life hell for real people,” said health economist Len Nichols of the New America Foundation public policy center. “They have never in their history offered to give up risk rating.”

Yes, Robin, it seems they are up to their old tricks. Trying to win political support for the "don't worry. Look, we're reforming ourselves. See?", argument that has kept 'em from the populist uprising proverbial boot up the you know what til now. You see, Robin, they are just not that into you!

Insurers are trying to head off the creation of a government insurance plan that would compete with them, something that liberals and many Democrats are pressing for. To try to win political support, the industry has already made a number of concessions. Last year, for example, insurers offered to end the practice of denying coverage to sick people.

Hey, that what I just said!

Insurance companies now charge very high premiums to people who are trying to purchase coverage as individuals and have a history of medical problems, such as diabetes or skin cancer. Even if such a person is offered coverage, that individual is often unable to afford the high premiums. About 7 percent of Americans buy their coverage as individuals, while more than 60 percent have job-based insurance.

Silly, people. Thinking they should be able to get affordable health insurance when they are sick or have an illness. Golly, that's when they need insurance. They should buy insurance when they are healthy and never use it and never go to the doctor so the nice insurance corporation can break all their profit records. And then an Angel gets its wings! Really!

The companies left themselves several outs, however. The letter said they would still charge different premiums based on such factors as age, place of residence, family size and benefits package.

Whoops, I always forget to read that fine print. Gets me every darn time! And I'm sure other factors too: like member size, number of dates in high school, if you ever fantasized about your grade school teacher...I don't feel dirty! etc.

I for one am not buying it. Any corporation that spends less than 60% of the dollars you give them to pay for a service that you could have paid for directly yourself and then denies you the service or denies the person (doctor etc) that gave you the service the money that was intended from them...well you get it...they are middle men...and a little more than self serving...maybe even crooks! Oh yes, quite frequently, crooks. Choosing who lives and dies. And they say doctors have a God complex. Methinks its the bean counting accountants! Except for mine, he's okay. I get to pick a toy off the top shelf every time a do my taxes!

Reuters - Health spending takes rising share of U.S. economy

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Health spending takes rising share of U.S. economy

Tuesday, Feb 24, 2009 12:52PM UTC

By Will Dunham

WASHINGTON (Reuters) - Health spending will hit $2.5 trillion this year, devouring 17.6 percent of the economy, as the White House and Congress consider major changes to the healthcare system, U.S. government economists said on Tuesday.

The Centers for Medicare and Medicaid Services, known as CMS, forecast that the share of the economy devoted to health spending will jump a full percentage point from 2008. That would mark the biggest one-year increase recorded since the government began tracking the data in 1960.

Thanks to the recession, public health spending in programs such as the Medicaid program for the poor is ballooning, while private health insurance spending is slowing as more people lose employer-provided coverage, CMS reported.

"We project that the health share of the economy will increase steadily through 2018," CMS economist Christopher Truffer told reporters.

The unbridled growth in projected health spending may add impetus to plans by President Barack Obama and leading lawmakers to make sweeping changes in the healthcare system.

The United States spends more on healthcare than any other country, but its system is widely considered inefficient and it lags many other nations in key quality measures. Past efforts to make major healthcare changes have died in Congress.

The rate of increase in overall health spending -- public and private combined -- was estimated at 6.1 percent in 2008, the same as the previous year, but is projected to slow to 5.5 percent this year due to the effects of the recession.

The report forecast that 2009's increase in private health spending would slip to a 15-year low of 3.9 percent.

Overall U.S. health spending in 2009 will hit $2.5 trillion, continuing a trend in recent decades that has seen healthcare encompass an ever-larger proportion of the economy, CMS said.

By 2018, U.S. health spending will almost double from last year's sum, soaring to $4.4 trillion and making up 20.3 percent of the overall economy, the economists reported in the journal Health Affairs.

Growth in public health spending this year is projected to hit 7.4 percent, amounting to $1.2 trillion, largely due to growth in Medicaid enrollment and spending, the report said.

The current recession began in December 2007 and the report forecast economic conditions would improve beginning in 2010. Health spending growth is projected to surge anew in 2011.

Private health spending growth will leap from 4.2 percent in 2010 to 6.1 percent by 2018, CMS said. Public health spending will surge in the same time frame as the post World War II baby boom generation begins entering the Medicare health insurance program for people ages 65 and up, CMS added.

Public spending was forecast to account for more than half of health spending by 2016 and reach 51.3 percent by 2018.

The report saw slower growth in prescription drug spending, down to 3.5 percent last year from 4.9 percent in 2007. CMS economist Andrea Sisko attributed this to the recession, saying the economic squeeze is making people less apt to fill their prescriptions and more willing to use cheaper generic drugs.

(Editing by Maggie Fox and David Storey)

Medical Pricing. How Do Doctors Arrive At Those Large Charges You See On Your Bill.

I mostly, agree with this writer, but I did not like his spin on the burden that reporting actual expenses would place on doctors. He seems to imply that it should be no big deal to turn overt this information. I beg to differ. Have you ever peaked into the private office space in your doctors clinic? If you have you can atest to the piles of charts and records requests and letters to and from insurance copanies that your eyes will be assailed by.

It should be noted that most doctors offices cannot be run like a Costco or a Walmart with sophistcated wireless inentory tracking, laser read bar coding, custom software designed specifically for each task, army of accountants, and large underpaid staff. Solo practitioners and small doctors groups simply cannot afford this expense and don't use this approach. Large medical groups and hospitals do and, hence have higher fees to cover the hundreds of thousands of dollars it takes to implement these strategies.

In addition the amount that an insurance agrees to pay the doctor, usually pre negotiated, is proported to have been derived by factoring in the doctors ancillary costs, however, one cost that is never factored in by these corporate giants is the expense doctors incur to collect thier money from the insurance companies. Delaying payments to doctors with a cornicopia of non payment strategies from "We never recieved a bill. Please resubmit.", "We need medical records to evaluate this fee." (For an ingrown nail? Please! This is tantamount to "I'll need a written request as to why you want to buy this hamburger before we can serve it to you, Mr. Abbes. Oh yeah, and after we get the written request, we still might not give you the hamburger or it may arrive within the next serveral months" Right!), to "We never recieved the medical records you sent. Please resubmit them". Don't believe me? Talk with your doctors and see if they don't share this experience as well. It is not unusual to recieve a payment for a service performed over 12 months ago. To assasinate the metaphor: It would be like eating a hamburger at McDonalds and paying McDonals for it one year later! (I'm sure they'll let you do that. Or not!)

In addition I should add that a consultation and an office visit have two different prices. If your doctor sends you to a specialist, he expects a lengthy report and recommendations sent to him by the specialist. For this reason a consult is more expensive than an office visit, generally. In addition most doctors of a lesser God charge between 250 - 500 for a consult, but you had to see the nice UCLA doctor. Andalé pues! Pay up Gringo! Don't you think his rent and UCLA pedigree cost him (or should I say his Republican parents) more?

Below article from the L. A. Times:

Medical pricing makes the head spin

"It began with a dizzy spell. Before long, though, what really had my head spinning was the inscrutable way that healthcare providers and insurers put a dollar value on medical services -- and how that leaves patients unable to determine a fair price for any treatment.

I woke up about a month ago with my bedroom feeling like the Mad Hatter's teacup ride at Disneyland. The sensation left me sick to my stomach and basically useless for hours.

My endocrinologist at UCLA's Gonda (Goldschmied) Diabetes Center advised me to speak with an ear, nose and throat specialist, and I booked an appointment with a physician whose office was down the hall.

The consultation went like this: We chatted for a few minutes, then he held me at awkward angles several times and promptly diagnosed me with benign positional vertigo -- a tendency to get dizzy if my head is in a certain position.

This took 20 minutes. The doctor performed no fancy tests or procedures. He prescribed no medication.

Last week I received a statement from my insurer, Blue Cross of Illinois, informing me that the doctor had billed $975 for the visit. The statement also said Blue Cross was paying just $243.64.

I contacted Anthem Blue Cross, which handles its Illinois counterpart's business in California, and asked if I was responsible for the outstanding $731.36.

"Oh, don't worry about that," a service rep cheerfully replied. "Because of our contract with them, the provider is writing that off."

So, was the treatment I received worth nearly $1,000, as the doctor apparently believed, or just a quarter of that amount, as Blue Cross had concluded? How can the provider and the insurer be so far apart in pricing a fairly routine medical service?

"It's a Byzantine system," said Jim Lott, executive vice president of the Hospital Assn. of Southern California. "There's no question about that."

Peggy Hinz, a spokeswoman for Anthem Blue Cross, said the insurer "relies on the latest medical pricing data and experts in the field" to determine how much it will pay for specific services.

"We always strive to reimburse a fair amount based on a provider's cost and based on what is reimbursed to other providers for like services," she said.

The ear, nose and throat specialist declined to discuss specifics of his billing. He said only that he had nothing to do with setting prices for his practice or negotiating contract terms with insurers.

Lott at the hospital association, which represents UCLA and about 170 other medical facilities, said patients are wrong to think that the charge on their bill reflects the actual cost of treatment.

Rather, he said, hospitals use a "cost-plus" system by which charges include both the cost of a service and a portion of general overhead, including treatment of uninsured people who can't afford the provider's cost-plus prices.

At the same time, insurance companies, along with state and federal authorities representing Medi-Cal and Medicare members, negotiate lower rates in return for delivering thousands of patients to a particular clinic or hospital.

The upshot is that providers are overcharging insured patients because they have no other way of meeting total expenses, while insurers are paying significantly less than the billed amount because they know they're being hit up for unrelated costs.

Insurers' underpayments, in turn, only force providers to increase bills even more. It's a system that both condones and perpetuates inflation while all but eliminating transparency in the marketplace.

It also spells doom for the 45 million Americans lacking health coverage, who have no choice but to pay the full amount of a hospital's cost-plus charges and thus can be wiped out financially by a major medical problem.

"Healthcare is the one sector where market mechanisms work least," said Peter Lindert, an economics professor at UC Davis who specializes in public-health issues. "Prices are whatever you can get away with."

As my colleague Jordan Rau reported last week, state lawmakers managed to pass some bills in the latest session that address healthcare problems but came up well short of their goal of reforming the system to make it friendlier -- and more accessible -- to patients.

Among legislation torpedoed by lobbyists for doctors and hospitals was a bill that would have given the state new powers to collect information on prices charged by healthcare providers.

Support for the bill dwindled after lobbyists managed to exempt doctors from the reporting requirement and inserted language recognizing the "tremendous burden" that revealing actual costs would be for providers.

Score that a win for the status quo and a setback for anyone who thinks healthcare costs are out of control.

"We are rapidly approaching a time where important policy discussions are going to have to be had on this issue," said Santiago Munoz, associate vice president of clinical services development in the UC president's office.

No, we're there already. What's needed is a massive infusion of political courage to tackle genuine healthcare reform.

No telling what that would cost, though.

Consumer Confidential runs Wednesday and Sundays. Send your tips or feedback to david.lazarus@latimes.com. "



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Why Medical Insurance Is Only A Discount And Not Insurance

Medical Insurance Is Becoming a Discount Plan And Not An Insurance Plan

(There is supposed to be a difference. Please see the Federal Trade Commission consumer alert for their warning and advice by clicking this link: FTC Consumer Alert)

I have been saying this for years now. The list of medical insurance woes is a very long interweaving laundry list with historical nuances and beyond a short blog post. It is the story of multiple books since its complex and compound details simply cannot be confined to just a few. Bearing this in mind, however, lets just take a quick jaunt through some salient and some recent developments that have come to the battlefront and stirred considerable political debate. Lets pull back the curtain and let me give you a bit of the benefit of my 21 years of industry exposure from a Podiatrists perspective, from an admittedly anecdotal view, and via the application of simple deductive analysis, i.e. common sense.

Medical insurance is quickly becoming a discount plan and not real insurance in the sense that we have all grown accustomed too. A recent article in the AP news wire service quotes a recent study that forecasts deductibles, co-payments, and out of pocket expenses will rise again next year. That means you the patient pay more of the share of the cost and the insurance company pays less. However your insurance bill will not go down. I don't know how the insurance companies continue to get away with increasing the cost on both sides of the balance sheet while reducing what they pay doctors and hospitals to the point where many hospitals, emergency rooms, and doctors are going out of business. In the face of this the insurance companies have reported record profits until this year! ("WellPoint Boosts Premiums to Bolster Profits") It seems that bleeding your clients dry in the face of decreasing job market, increased energy costs, and increasingly undertreated epidemic chronic diseases is not a good strategy. You just don't kill the cow if you want to get any milk.

While some relief of suspect health insurance company reimbursement practices is finally coming to California from Sacramento lawmakers it is certainly too little and certainly too late for many.

"The Legislature's major healthcare accomplishments involved several high-profile, though relatively uncommon, practices that afflict consumers and patients. Lawmakers agreed to stop insurers from retroactively canceling policies of sick customers..."

"Legislators also voted to require insurers to spend at least 85% of the premiums they collect on medical care rather than overhead and profits. If signed by Schwarzenegger, that measure could turn out to be the nation's most stringent, although there are doubts that it will lead to lower premiums. In addition, lawmakers decided that insurers must pay for maternity care, orthodontics cleft palate treatment and the purchase of medical equipment such as wheelchairs."

These changes appear to this observer as hardly earth shattering. If anything they are common sense changes that should have been enacted long ago. Good God I think that my health insurance should spend more than a mere 85% of what they get to take care of the sick. If anything why is there a limit at all. Ah yes, of course profit. And the almighty profit is worth more that the health of your mother, or sister, or daughter. Sure that makes sense. (cyniscism and snarkiness borrowed from Republic National Convention) Pay for a wheelchair! I'll bet you thought that was a given. Surprise, its not! (Limp or crawl home if you can't afford one or beat up that week retard down the street and take his wheelchair. Great.)

All of the measures await action by the governor, who has until Sept. 30 to sign or veto bills from this session.

It is not unusual for a patient to visit my office, have a bill sent to their insurance company for the $65 office visit, the insurance pays me, the doctor, $9.00, and the patient is liable for the remaining $45, with an $11 negotiated discount for seeing a participating provider in your insurance plan. It is also common for a patient to present to my office and pay a $35 or $45 co-payment at the time of visit and after sending the bill to the insurance company for $65 they, the insurance company, pay $ 1-10 (Or even less. I have seen checks in the amounts of 0.40 cents. Don't believe me? Ask your doctor. E-mail Dr Sanjay Gupta if you please. Click here for Dr. Gupta's Blog) This means you pay $45 they pay $5 or $10 dollars for a visit to the doctor that costs $65. All this, while you send them $500 to $800 a month for what they call health insurance. That's not insurance my friends that's a medical discount card.

The average income of a family practice doctor is around $180,000 a year. No joke. Although that seems like a decent wage in comparison to other jobs, the years of study and the average student loan debt of over $150, 000 (mine was closer to $200,000 and the average Podiatrist income in Los Angeles is placed at some at around $ 150,000) incurred by doctors it may not be so attractive. I have met sales reps making the same amount and never had to endure the long years of study and student loan debt. Article after article has been written about and by doctors sharing their discontent but more importantly students are being deterred from studying medicine, especially family care, as a result of these dissincentives. Why should they toil taking difficult pre-med courses in college, struggle through difficult medical school programs, suffer long hours in residency and internships, and incur great debt only to struggle to make ends meet and under the pressure of mountains of debt for years? It is much shorter and easier for the these intelletuals in our society to pursue some other mor profitable venture. The result doctor shortages while an increase in patients due to the aging baby boomer population will create medical care crisis already being felt in parts of Canada and discussed with respect to Medicare costs.

"American health care is now largely delivered via a government-subsidized private health insurance industry operating parallel to and within Medicare. A recent nationwide poll of physicians published in the Annals of Internal Medicine utilizing the AMA physician database demonstrated that 60 percent of doctors support a single-payer national health plan based on the most efficient and effective Medicare system.

This national health plan currently before Congress (HR 676) would provide medical care and low-cost prescription drugs to all Americans - including the 47 million uninsured and 50 million underinsured citizens - while maintaining the private-practice quality of physicians, hospitals, clinics and therapists.

The lower overhead costs of the most efficient Medicare insurance plan, which already treats more than 40 million people, would provide substantial cost savings to all Americans and businesses while maintaining quality private physician practices and hospitals. A majority of physicians in this country can't be wrong in their support of a single-payer national health insurance plan such as HR 676. - HOWARD A. GREEN, M.D."

Watch actual persons tell their story of medical insurance woes in person in an AARP TV Ad Campaign which hits the nail on the head by clicking on this link. Unless you are a human with a reptile nervous center you will be moved by these true stories (requires flash palyer)

(Blue and underlined words indicate a link to a source article or video, double click to view these. Quotes are in italics.)