Monday, June 13, 2016
There is a lot going on. Today’s blog post will also be sent separately to my clients. The next blog will deal with high concepts, today we tackle some of the basic issues that affect most of you. But as I said, this blog will be duplicated as my current client letter. Read this and you get to skip the letter.
This isn’t as easy as it looks. Running a health insurance company is a lot than it appears. Any number of hospitals, medical organizations, not-for-profits, and government entities have invaded my business over the years. On paper it doesn’t look like that big a deal. Collect a lot of money (premiums) and pay the doctors and hospitals for services rendered (claims). We’ve recently lost InHealth, one of the government created CO-OP’s, and Catholic Health Partners’ foray into insurance, HealthSpan. Both entities were spectacular flops that failed to survive five full years.
Unfortunately, even the pros are having their struggles. I have seen a massive increase in insurance company errors. This may be, in part, due to the Patient Protection and Affordable Care Act (PPACA or Obamacare). As the companies expend millions of dollars to comply with new regulations, they are also limited in how much of each premium dollar can be spent on infrastructure (Medical Loss Ratio). Something has to give. The problems created y insufficient staffing and quick fixes directly affect you.
Quick example – A client recently purchased a policy with a $5,000 deductible. The application was accidentally changed to a $1,000 deductible at the Home Office. Understaffed, this major insurer had no one to catch the error. The system simply spat out the more expensive policy and a bill. The client called as soon as he got the bill. It only took me an hour or so to figure out the problem and to get the insurer to promise to fix it. What a waste of time and money. And yes, cancelling and reissuing the policy costs them a lot of money. These costs will eventually be passed to us.
Billing is a huge issue. Let’s say that you arrange to have your monthly premium electronically withdrawn from your checking account or credit card. Your policy will lapse if the money doesn’t transfer. It doesn’t matter if the insurer screws up and fails to take the money (more common than you’d think). No one cares if Chase gets hacked again. You will get no pity if your check bounces. It is up to you to make certain that the money left your account or was charged to your card. And if it isn’t, you must call your agent or the insurance company immediately. We don’t have the flexibility we once had. I currently have four clients in limbo due to this.
Grace Periods are for emergencies. Too many people think that a 30 day grace period means that their policies are due on the 30th of the month, not the 1st. You know what happens. They are a touch late, miss the end of the grace period, and are then shocked that they are suddenly uninsured. This can be a really expensive lesson. Many of us cannot afford to be without coverage. The first check I authorize each month is my health insurance bill, FOR THE FOLLOWING MONTH.
Short Term Policies are under attack. Many of my clients have been purchasing short term major medical policies. These policies are not compliant. Preexisting conditions are not covered and the policies are not guaranteed issue. The premiums for these policies and the tax penalty for opting out of Obamacare may still be a lot less than a compliant policy. The State of Ohio recently expanded the definition of short term to 360 days, further enhancing this consumer safety valve. The people who purchase these policies tend to be very healthy. And that is the problem.
It took a while but Health and Human Services Secretary Sylvia Burwell has realized that one of the reasons health insurance premiums are skyrocketing is that lots of healthy people are opting out. Sales of short term policies are higher now than in 2013. Secretary Burwell wants to restrict the policies to 90 days in an effort to force healthy Americans back into the general risk pool.
The perspective short term regulations were just announced a few days ago. The next step is a 60 day period for public comment. The final regulations, if any, will be crafted mid-August. I will be monitoring this issue.
As a point of personal privilege, I’d like to thank so many of you for your cards, calls, and emails. The post Shedding Pounds By Shedding Organs is the quick explanation of how I got here. I started radiation on June 6th. 9 weeks. 5x per week. I’m fine. I feel stronger every day.
Open enrollment is still several months away. We will get through this together.
Wednesday, May 25, 2016
I got caught. One of my readers noticed that I had yet to say a word about Senator Bernie Sanders and his health plan. I have reviewed plans from Scott Walker to Donald Trump. I’ve even covered Obamacare-lite plans from the Senate Republicans. But like Secretary Clinton, I just kept waiting for him to go away. But he hasn’t…
I read Senator Sanders’ plan over the weekend. It is very easy to understand, especially if you are five years old. Go to the doctor and Dad pays the bill. You may, or may not, get a lollipop, but no one will ask you, at age five, for any money. Need a prescription? Go to the drugstore. Dad’s got it covered. Hospital? Physical therapy? Inpatient substance abuse? Whatever you need, don’t worry. Dad’s got you covered. Great Dad. Rich Dad. Really rich.
Dad is the federal government.Senator Sanders plan provides 100% coverage. No deductibles. No coinsurance. No copays. He pulls all of the consumer money out of the system. He eliminates all patient incentives to limit or question care.
Where does the federal government get all of this money?
- 6.2% income-based health care premium paid by employers
- 2.2% income-based premium (after deductions) paid by households
- Tax capital gains and dividends as ordinary income
- Limit tax deductions for households earning over $250,000
- Rejuvenate the estate tax
- Increase marginal income tax rates to 37% for a $250,000 family income to 52% on incomes over $10,000,000
It is difficult to illustrate an apples to apples comparison. Your average 40 year old has an insurance premium, deductible, coinsurance, and copays. This plan has none of that. The closest I can provide would be Medicare.
My clients love Medicare. They’ll tell you how they don’t pay anything at the doctor’s office and how they never saw a bill after a hospital stay. Even prescriptions are manageable.
Of course, that’s not Medicare. That is traditional Medicare plus a Medicare Supplement Plan F plus a Medicare Part D (Rx) plan. But most people just see it all as Medicare once it is all put in place.
Medicare is not free. We have all been paying into it for years. The doctors and hospitals are paid on a fee schedule that is more subject to politics than market forces. This is what you would pay if you turned 65 next month and went on to Medicare.
- Medicare Part A - No Charge
- Medicare Part B - $121.80 per month
- Medicare Supplement Plan F - @$150 per month
- Medicare Part D (Rx) - @$20 per month
The Sanders plan does not factor in age, just income. A 22 year old pays the same as a 72 year old, probably more.
How much would an unemployed/retired 65 year old pay under Senator Sanders’ plan? Assuming a Standard Deduction:
- Annual Income of $20,000 - $281.60 per year
- Annual Income of $40,000 - $721.60 per year
Does this prove that the Sanders plan can’t succeed? No, but I believe that it would take a giant leap of faith to make these numbers fly. The lack of consumer/patient involvement dooms the program. I still believe that the Patient Protection and Affordable Care Act (Obamacare) has put us on the path to a single-payer system. I just don’t see how it could be a 100% plan.
Free. We want free. But we’re not five and Dad, even a Dad that can print money, can’t afford to give us everything we want.
Picture is of a dad, but not one who can print money.
Tuesday, May 10, 2016
The University Hospital system is incredibly efficient. I’ve spent a lot of time lately in both the suburban facilities and the main campus. The clerks manning the check-in desks and the schedulers don’t do anything until they make a copy of your photo ID and insurance card. I once went to the same office, same clerk, two days in a row. She didn’t deviate, didn’t skip a step. University Hospital knows how it is going to be paid. And that’s a good thing. I just thought it weird when the gift shop asked for my photo ID and insurance card...
# # # #
The young widow had her own share of nagging health issues. Last May her doctor looked her in the eye and told her that he wanted her to have a heart catheterization. This wasn’t an emergency. He just felt that it was warranted. More importantly, he wanted a specific doctor at U.H. main campus to perform the procedure. This would be fine except that Brenda (name changed) has Medical Mutual of Ohio. MMO’s network includes the Cleveland Clinic and the suburban University Hospital facilities. It is common knowledge that Brenda had great coverage throughout Northeast Ohio. Everywhere but U.H. main campus.
He sent her to U.H. Main Campus.
Brenda should have known better, but she was totally focused on the fact that she needed a heart catheterization. The doctor simply didn’t care. The schedulers, both at the doctor’s office and at U.H. main campus, noted her coverage as they set up her non-emergency appointment. And since it was not an emergency, she had close to a month to worry about this procedure and her health.
Brenda got the call the day before the procedure. It was a courtesy call from University Hospital to let her know that she was going to be out-of-network. Did she still want her heart catheterization? It was too late to turn back. She had worried about this for almost a month. She made a snap decision. How bad could it be?
Brenda paid $11,000 in out-of-network fees. I consider this an abuse of privilege. Everyone involved knew that Brenda was going to the wrong facility. This was not an emergency. And this was too high a price to pay for good news.
# # # #
The bills are coming in for my little adventure. University Hospital, the doctors, and the labs have submitted claims in excess of $250,000. So far. My share, to date, has been my $5,500 deductible. All of my services were rendered by in-network providers. Anthem seems to be doing their job so that I can do mine, recover.
$250,000! I think that it would have been cheap at twice the price.
Monday, May 2, 2016
Quick Personal Update – Thanks for asking. I’m feeling stronger everyday. Already spending too much time at the office.
Frank (name changed) knew exactly what he wanted. Frank wanted the kind of policy he used to have twenty years ago when he worked in the family business. He wanted a small deductible, office copays, and an Rx card. A throwback. The policy needed to cover him and his twenty year old son. He wanted Platinum in a Silver or Bronze environment. Frank was insistent.
There was a way. I could put Frank and his son into the Government Exchange. Medical Mutual of Ohio was still offering a Gold Level policy through the Exchange, and even though he didn’t qualify for a tax credit subsidy, we could access this contract for them. I DIDN’T WANT TO DO IT. I warned Frank that accessing the Exchange needlessly simply multiplied our chances for failure. But Frank was insistent.
I can’t tell you how many hours I have invested in this disaster. It is difficult to even explain how healthcare.gov messed this up. But they did. The original mistake isn’t the interesting part. It is all of the subsequent steps that leave us today, May 2, 2016, with Frank and his son uninsured.
Let’s skip ahead to April 9, 2016. Frank sat in my office for almost two hours that day. We were on hold for over 40 minutes before we got to talk to anyone. We were lucky. The woman we worked with seemed both knowledgeable and caring. Here is what she told us:
- I can see where we corrected the initial problem and got Mr. Frank and his son covered as of March 1, 2016
- I can see where we corrected that mistake and got Mr. Frank and his son correctly covered as of February 1, 2016
- I can see that the policy then automatically cancelled itself out on March 1, 2016 through no fault of the insured
- I can see that this was supposed to be expedited
- I can see that it was never expedited
Don’t get too comfortableThe rejection letter came three weeks later. The government had decided that he didn’t deserve to have his policy reinstated. The letter helpfully included the marketplace appeal hotline 855.231.1751. Frank came in today.
By the way, this isn’t a specific problem of the Patient Protection and Affordable Care Act (Obamacare). This is a bureaucracy issue. This is a regulatory issue. This is a full-fledged screw up.
Frank sat in my office as I called the hotline. Working through the automated system I finally hit the button to file an appeal. WE WERE IMMEDIATELY DISCONNECTED.
Second call. This time, to the surprise of a Ms. Shannon, I managed to get to a human being. She had no interest in hearing why we were calling. The process demanded that we must first go to healthcare.gov, file an appeal, and then, and only then, will anyone talk with us. Maybe. I tried. She wouldn’t budge.
We went to healthcare.gov with her on the line. She made sure to point out the next to the last section, Choose an Authorized Representative. Frank had the right to name me as his contact, someone who could easily answer their questions and make sense of this. We got off the phone and completed the appeal form.
And once the appeal form had been completed we hit the link to the special authorization form. The picture at the top is where the link takes you. We’re so screwed…
Sunday, April 24, 2016
My new weight loss programStanding by the hospital bed, the two nurses discussed the patient’s status. They reviewed recent ultrasounds, CT Scans, and the importance of “you have to go before you can go”. At some point I just looked up at the two of them and said, “I am being transformed from a 61 year old man to a 29 year old in the Maternity wing.”
Welcome to a very special Health Insurance Issues With Dave. It must now be obvious that some of the posts of the last year dealing with doctor interaction and cancer treatment were, in fact, about me. I apologize for being less than 100% transparent. I kept waiting for my Emily Litella moment. It just never came. (By the way, the links are footnotes that attempt to make these posts more informational and entertaining. Take a moment to enjoy Gilda Radner).
This post will discuss my last two weeks in stark detail. The picture above was taken Thursday, after I got home. Yeah, Happy Ending. Still, my story is still evolving and so is yours. And though less than pleasant, this is very relevant to you.
My annual physical has always included bloodwork. My PSA started to climb a few years ago. Nothing shocking. Not too high. No spikes. I didn’t have ANY problems, but I could hear my prostate calling. I finally had a biopsy last fall. The news wasn’t good. I had a Gleason Score of 7.
In some countries an otherwise healthy, asymptomatic man in his early 60’s would be monitored. Prostate Cancer moves slowly. In the US we aggressively tackle Prostate Cancer now, while the patient has the best opportunity to not only withstand the process of surgery or radiation, but to lead a long, normal life post-treatment. I opted for a combination of hormonal and radiation treatments. This was detailed in my last post.
I was invited to participate in a clinical study. Part of the protocol was another CT Scan. My last was just outside the timeframe. OK. One more test. The test results were fine, except that there was a shadow on my left kidney. The subsequent ultrasound was not determinant, but it wasn’t good. The next CT Scan was focused on my kidneys. I had a mass, approximately 10 cm wide, on the base of my left kidney. It didn’t matter if it was benign or malignant (probably), it had to come out. The radiation was put on hold for a couple of months so that this could be resolved.
This picture is of me walking into University Hospital Wednesday morning, April 13th. I had to accept that this was to be the first day of my process. It might be a year before I felt this good again.
The goal was to remove the mass and a small part of my left kidney. The surgeon would attempt to utilize minimally invasive techniques. But if he didn’t like what he saw, I had been warned that he wouldn’t hesitate to open me up and take the entire kidney. I should be able to leave the hospital Friday or Saturday. Sunday was my worst case scenario.
The surgeon removed the mass and part of my kidney. The doctors were concerned about my post-surgical bleeding. They took me back in, briefly, early that afternoon. Ten hours later we came close to ending my life as we ended the day. I was bleeding to death. You aren’t supposed to remember these incidents. I recall the room in vivid detail. At some point I attempted, with my left hand, to authorize another complete surgery while keeping my blood-soaked gown away from the form.
Let us at this point finally end the irrelevant notion of patient controlled cost containment. The patient, a 61 year old man who had never had any previous medical issues and was not on any medications, needed a major operation. He had done his part. Do We Save His Life? That is a YES or NO question. What if he had been 71? 81? 91? This is a question that we, as a society, must answer.
So, we all agreed to save my life. Yeah! Now, who’s paying? We have several ways to pay for medical services:
- Private Business (Insurance)
- Some combination of government and insurance
And just as important, who decides how much the medical providers (doctors, pharmaceutical companies, hospitals, labs, etc.…) get to charge for their goods and services?
- Private Business (Insurance)
- Some combination of government and insurance
- Or are the medical providers allowed to charge whatever the market will bear?
Each patient is connected to an impressive array of computers. Each machine has its own set of bells, horns, and alarms. Sleep and silence have been disrupted by an alarm. Every minute of an alarm feels like an hour. Alone in the darkness you first need to determine if it is your alarm. Why is it ringing? Am I Ok? And if it isn’t you, you relax for a moment before you wonder how that other guy is doing.
I awoke in the intensive care unit. Sally and Jennifer had been through the entire previous 30 hour adventure and were visibly relieved. They were allowed to dab my lips with a wet sponge. I was moved within a few hours to a surgical step-down unit. They gathered my stuff and put a long stainless steel cylinder next to me on the bed. “What’s that”, I asked. “That’s what’s keeping you alive”. I tried to move over and give them room for two.
I had been told that there was an almost sadistic nature to the way nurses and techs woke you up all night to draw blood and take tests. I greeting my nurses, nurse’s aides, and tech by name. Their presence proved that I was still alive. And I was only going to be able to leave the hospital with their help.
I had a great team. I recall these names: Nurses Becky, Sue, Lauren, Jen, Katarina, and Megan. Assistants Dave, Marie, and Debra. The surgeons resolve a problem. The nurses heal the patient.
Mark was one of my nurses in the step-down unit. Mark is in total control of his little corner of the world. Lucky for me, I got to spend about twelve hours there. He was the one to track down XL sized hospital socks, reassure Jen and Sally, and remove the catheter. Mark decided that I had to get out of the bed and take a wheelchair to my room on the 5th floor. There was push back. Didn’t matter. Mark was my first step towards recovery.
Nurses tell the truth. It is sometimes the patient’s responsibility to ask the right questions, but the nurses are your advocates. I was fortunate to have Tom for a couple of days in a row. He answered every question. He helped me to mentally prepare for my recovery.
I got home the afternoon of Wednesday, April 20th. I’m OK. Really. I’m almost fine. I’ve very tired and it will take a while to be back to 100%. I will share the bills with you as they come through. I’m curious as to what this all cost. I bet it would be cheaper and easier to drop a few pounds by going to Weightwatchers.
Thursday, April 7, 2016
Consumer Directed Health Plan. One of the biggest jokes in the health insurance industry is the illusion of control. We pretend that you, the consumer, can control your medical expenses. We created products that, by law, have high deductibles, no office visit copays, and no Rx card. We know that you will shop for the best deals in primary care doctors and cardiologists. We are counting on you to force the doctors to justify every blood test, CT scan, and procedure. You know that you are a great shopper. Here’s your chance to prove it.
Can you shop for a deal when they are wheeling you in to the hospital with a blocked artery? “Hold up Mr. EMT. I just got a text alert that Hillcrest is having a sale on bypasses this week.”
But of course, none of this is real. There is no way to know the real cost of medical services in advance. And who amongst us wants health care by the lowest bidder? Plus, do we know anyone who is prepared to say to his doctor, “Another surgery? Gosh I don’t think we should spend so much just to save my life.”
The client is in the early stages of his treatment for prostate cancer. He and his doctors discussed the various ways to remove his prostate, external beam radiation, and even radiation seeds that can be implanted. The patient chose external beam radiation. The doctors then suggested that he also have hormone therapy.
Hormone therapy almost appeared to be an afterthought. By taking pills or getting shots the patient would inhibit testosterone production, shrink the prostate, and slow the growth of cancer. What shot? Which pill? The patient was told that the nurse practitioner would tell him when they met.
The client had a shot and got a bill a few weeks later. Ready? The shot cost $34,228.50. Surprise. The Anthem Blue Cross negotiated price for the shot was $18,932.99. The client’s deductible was $5,500. He blew past that. The client maxed out his share and Anthem paid the rest.
I looked at the bill and the first question I had was, “Did they buy you dinner?” I mean for this price he should have received a gift card for The Cabin. Sadly, all he got was an off switch for his libido. My second question was, “Is this some new miracle drug?” No, he was given Lupron which has been in use for over 30 years. The good news that it was a double shot, good for 6 full months.
$34,228.50 for one shot. Who knew? That’s easy. Everyone but the patient.
We have no control. Remember our friend the next time you wonder why your insurance premiums are going through the roof. I wouldn’t have done anything differently. You would have been just as surprised as he was. This shot is just one more example of a broken system in search of a solution.
Thursday, March 10, 2016
The Metal Tiers were a key component of the Patient Protection and Affordable Care Act (Obamacare). The idea was to force all policies (square pegs) into four levels of coverage (round holes). The metal tier would allow you to purchase a policy that would fit your needs. Each described the percentage the policy would pay of your overall healthcare claims.
Platinum – 90%
Gold – 80%
Silver – 70%
Bronze – 60%
Are these percentages accurate? Do they really represent 90%? 60%? Who knows? If you ask 5 people you will surely get 7 answers. Part of the problem is that everyone, and I do mean everyone, is engaged in the constant struggle to recreate reality. The pricing, the policies, the benefits, the covered doctors and hospitals, and even the insurers change annually. There can’t be an apples to apples comparison when 2014’s apples were replaced by kumquats in 2015 which were replaced this year by frozen pizzas.
The PPACA included an annual cap for out-of-pocket covered expenses. That cap has increased each year. In 2016 it is $6,850 for an individual and $13,700 for a family. This number includes the most you, the consumer, can spend on the deductible, copayments, and co-insurance during the calendar year. It does not include the premiums you pay.
The 2017 maximum out-of-pocket will be $7,150 for an individual and $14,300 for a family. Those numbers apply to Platinum, Gold, Silver, and Bronze policies. But if you have a family, especially a family that has ongoing health issues, the possibility of facing $14,300 of exposure (plus premiums) doesn’t feel like Platinum, Gold, Silver, or Bronze. It feels like lead. And many of these policies will be as valuable as lead pipes in Flint.
The health insurance market is changing rapidly. I can’t find a Platinum level policy in Cuyahoga County. There are only a few available in all of Ohio. Gold level policies are disappearing, too. At some point the metal tiers will need to be redefined or a couple of new ones will have to be added. Or, we will change to letters, such as Tier A, Tier B, Tier C, etc…
Because when all else fails we can always fall back on rebranding.