Wednesday, June 29, 2016

The Publicity Stunt

The Speaker of the House, Paul Ryan (R-WI), was clearly agitated. The Democrats were holding a sit-in on the House floor in order to push for a vote on gun control legislation. He later labeled the protest, led by civil rights icon John Lewis (D-GA), a publicity stunt. And he was right. The Democrats became the major story of the day thus overshadowing a different publicity stunt, Speaker Ryan’s attempt to grab attention earlier in the day.

This being Health Insurance Issues With Dave, we will give Speaker Ryan the attention he craves. Announcing the G.O.P.’s A Better Way. Our Vision For a Confident America.

Yes, it’s here. Thirty-seven pages of pure Conservative legislative joy. Here is the link. Better yet, here is the link to the one page summary. You probably won’t want to waste your time on the long version once you’ve taken a peek at the summary.

The summary is one page, bullet point laden, and facts optional. It promises a Republican Plan that retains all of the things you like from the Patient Protection and Affordable Care Act (Obamacare), such as guaranteed access and dependent care to age 26, without any of the costs. Really, no tax increases. Zero! The Republicans feel that codifying the Hyde Amendment is also a major selling point. And speaking of selling points, the summary never mentions President Obama or Obamacare. Instead, Obamacare is renamed “Speaker Pelosi’s Bill”. The full version isn’t much better.

Speaker Ryan is very proud to announce that this 37 page outline of ideal, goals, and wishful thinking is the first plan universally endorsed by all of the Republican leaders in the House. It isn’t really supposed to be a plan. When asked, leadership has labeled it a “White Paper”. I actually printed out and read the full presentation. It is the only way to know that Speaker Ryan forgot to estimate the cost of his programs or that he is pushing Medicare to age 67 (page 36).

A Better Way is really an organized collection of the Republican’s greatest hits of the last six years. We rejected most of these ideas as inconsequential then. They aren’t more relevant repackaged today. Part of the problem is the refusal to face the realities of the insurance marketplace and the inclusion of information that is laughably false.

Here are the five principles of A Better Way:
  1. Repeal Obamacare
  2. Provide All Americans with more choices, lower costs, and greater flexibility
  3. Protect our nation’s most vulnerable
  4. Spur innovation in health care
  5. Protect and preserve Medicare
Protect our nation’s most vulnerable. Patients with pre-existing conditions, loved ones struggling with complex medical needs, and other vulnerable Americans should have access to high-quality and affordable coverage options. Obamacare’s solution was to force millions of people onto Medicaid…
No, it didn’t.

The PPACA eliminated medical underwriting. We no longer ask health questions when you apply for coverage. Pre-existing conditions are covered completely. And the premium for your insurance policy no longer reflects your previous claims or medical conditions. Medicaid, where expanded, allowed additional lower income individuals and families to acquire coverage regardless of their health. Statements like the one above call into question the seriousness of the document.

And how does A Better Way deal with our most vulnerable? Badly. This plan reintroduces medical underwriting and suggests that we reinstate state run High Risk Pools. The Republicans strongly criticized the transitional High Risk Pools of Obamacare. They were, in part, correct. Five Billion Dollars wasn’t enough even though this was just for the transition to the full implementation of the new law. This program offers Twenty-five Billion Dollars (from where?) and walks away from the unhealthy.

Here are a few of the other highlights of Speaker Ryan’s plan:
  • No requirement to have any health insurance policy
  • No Coverage Standards (under or over age 65!)
  • An age based refundable tax credit to replace the income based subsidies
  • Adjust premium ratio to 5 – 1
  • A significant overhaul of Medicare
  • Changing the onset of Medicare to that of the Social Security Retirement Age.
It is important to note that Obamacare is far from perfect and that some of the ideas included in A Better Way might help the law to work better. That is, of course, ruled out immediately by Speaker Ryan and his team. It is this unwillingness to work with the President that makes all of these documents wasteful publicity stunts.



Monday, June 13, 2016

June 2016 Update

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.