Is Louisiana G-d's Waiting Room?

 

So many of my clients are retiring and looking to move out of Ohio.  There are too many reasons to list as to why they want to leave, but the eternal question is “WHERE?”.   I have clients looking at Portugal, Spain, Italy, and Central America.  There is a certain romanticism to the thought of being an Ex-Pat.  Cost of living, politics, and access to health care all factor into these decisions.  Most of my clients will stay in the U.S.  In fact, many will look elsewhere but will stay here in Ohio either because they have weighed the options and made the positive decision to stay or due to inertia.  With Ohio’s population growing at less than 50% of the U.S. average, our governor and legislators don’t really care why you stay.  They are just glad you are here. 

But let’s say that you are thinking about moving.  Becker’s Payer Issues has released a new report listing the best and worst states for Medicare.  This is the link.  The table also includes the District of Columbia. 

“The healthcare research foundation evaluated states on criteria spanning four domains: access to care, quality of care, costs and affordability, and population health. These performance indicators draw from CMS, federal surveys and other public data sources. The Commonwealth Fund ranked states according to how well Medicare was working based on those indicators. The organization mostly reviewed data from 2023 through 2025.” 

There are a few surprises in the list.  The first five states are Vermont, Utah, Minnesota, Rhode Island, and Colorado.  You were hoping for a beach and warm temperatures.  In a Chamber of Commerce moment, Ohio ranks 25^th.  Florida came in #40, just a touch better than Alaska (Polar bears may or may not have factored into this report).  If you have been reading these blogs over the last 15+ years, you know which states were the worst.      

     41. Alaska

     42. Georgia

     43. New Mexico

     44. Alabama

     45. West Virginia

     46. Texas

     47. Arkansas

     48. Oklahoma

     49. Kentucky

     50. Mississippi

     51. Louisiana

Residence of these states have the lowest life expectancy, and the highest rates of uninsured.  It may be reasonable to ask if Speaker of the House, Mike Johnson, is representing G-d’s Waiting Room. 

My advice is to learn to ski and move to Vermont or to stay in Ohio and hope that climate change improves our weather. 

Dave 

Health Insurance Issues With Dave

Picture – Some Of Us Will Stay – David L Cunix

 

 

Is Your Senator Killing You?

 

We are still in a government shutdown and we are still covering the number one cause of this impasse – the extension of the Expanded Tax Credits for the Patient Protection and Affordable Care Act (Obamacare).  The Republicans intentionally left these important middle class benefits out of their Big Beautiful Bill.  This is the only chance the Democrats have to salvage our health insurance, the way most Americans access and pay for health care. 

Senator Patty Murray (D-WA) published a list of the ten states that would see the highest family premium increases if the Republicans refuse to extend these tax credits.  The names of the states, and their Senators, always appear on lists like this. 

     State                                                 Percent of Increase

1.   West Virginia                                 387%

                Senators – Shelly Moore Capito (R) and Jim Justice (R)

2.   Wyoming                                       382%

               Senators – John Barrasso (R) and Cynthia Lummis (R)

3.   Alaska                                            346%

               Senators – Lisa Murkowski (R) and Dan Sullivan (R)

4.   Tennessee                                      320%

               Senators – Marsha Blackburn (R) and Tom Cotton (R)

5.   Mississippi                                     314%

               Senators – Roger Wicker (R) and Cindy Hyde-Smith (R)

6.   Texas                                              289%

               Senators – John Cornyn (R) and Ted Cruz (R)

7.   South Carolina                              285%

               Senators – Lyndsay Graham (R) and Tim Scott(R)

8.   Alabama                                        284%

               Senators – Tommy Tuberville (R) and Katie Britt (R)

9.   South Dakota                                235%

               Senators – John Thune (R) and Mike Rounds (R)

10.  North Dakota                               234%

               Senators – John Hoeven (R) and Kevin Cramer (R)

As this blog has noted, many of the above named states will have the highest percentage of uninsured and their residents have the lowest life expectancy. 

Per the United States Census Bureau, the state with the highest number of uninsured is Texas.  But you knew that.  Per the last available data, 2022, 18% of Texans, nearly one in 5, don’t have health insurance coverage.  That is almost 5 million people.   In case you’ve forgotten, Texas is represented in the US Senate by Republicans John Cornyn and Ted Cruz. 

The World Population Review lists the life expectancy for all 50 states and the District of Columbia.  According to their website, these are the factors that will affect life expectancy: 

“In general, life expectancy is based on two major factors: genetics and lifestyle choices. These include—but are not limited to—gender, access to quality health care, hygiene, obesity, diet and nutrition, exercise, and crime rates. Overall, the highest life expectancies appear in the healthiest states. Additionally, women tend to live longer than men. In 2021, American men could expect to live 73.5 years on average, while American women could expect to live 79.3 years—a 5.8-year gap.”

The gap between men and women is, on average, 5.8 years.  But the gap between Hawaii (79.9), represented by Democrats Brian Schatz and Mazie Hirono, and Mississippi (70.9) is NINE FULL YEARS.  And yes, there is a pattern. 

   State                                                 Average Life Expectancy

50.  Mississippi                                    70.9

               Senators – Roger Wicker (R) and Cindy Hyde-Smith (R)

49.  West Virginia                                71.0

               Senators – Shelly Moore Capito (R) and Jim Justice (R)

48.  Alabama                                       72.0

               Senators – Tommy Tuberville (R) and Katie Britt (R)

47.  Louisiana                                    72.2

               Senators – Bill Cassidy (R) and John Kennedy (R)

               Also – Speaker of the House – Mike Johnson (R)

46.  Kentucky                                       72.3

               Senators – Mitch McConnell (R) and Rand Paul (R)

 

On the other end of the spectrum:

1.   Hawaii                                           79.9

               Senators – Brian Schatz (D) and Mazie Hirono

2.   Massachusetts                               79.6

               Senators – Elizabeth Warren (D) and Ed Markey (D)

3.   Connecticut                                   79.2

               Senators – Richard Blumenthal (D) and Chris Murphy (D)

4.   New Jersey                                    79.0

               Senators – Cory Booker (D) and Andy Kim (D)

5.   New York                                       79.0

               Senators – Chuck Schumer (D) and Kirsten Gillibrand (D)  

There is an obvious correlation between access to health care and life expectancy.  It may be just coincidental that states led by Democrats and represented in the Senate by Dems seem to enjoy the highest percentage of insured citizens and the highest life expectancy.  Could be.  Take a look at the charts and tell me if you see a pattern.  Ohio is now at 12^th from the bottom in life expectancy.  We could crack the bottom 10 soon. 

So here is a question to ponder while we wait to see if the Republicans will relent and extend the expanded tax credits, is your Senator killing you?  It is nothing personal.  Trust me.  Senator Jon Husted doesn’t know your name and, more importantly, he really doesn’t care. It’s not his job to care.  Your access to health care may depend on how the votes go in the next week. 

Or you could move to Hawaii.

Dave

Health Insurance Issues With Dave

Picture – They’re Killing The Grass, Too – David L Cunix

                                                           

Reality Used To Be A Friend Of Mine

 

Quick Note – I sincerely apologize to the five or six of you, my regular readers, who wondered what happened to this blog.  Between the closing of my office and a little health care issue, I have not had the opportunity to address all of the craziness of the last few months.  

 

Vice President Gary Nance, played by Ben Kingsley, talked about how he got started in politics in the movie, “Dave”.  He was motivated to help his community.  He was motivated to do GOOD.  And I wonder, each time I think about that movie and everyday when I watch our politicians, like Speaker of the House Mike Johnson, on TV, when doing GOOD no longer became their defining purpose.  I refuse to believe that the majority of our elected officials have abandoned such basics as honesty, human decency, and the desire to help our fellow citizens, especially those most in need.  But I could be wrong. 

Today’s post is going to get into the details, the details for how Congress passes legislation and the consequences of said legislation.  There will be a lot of links to take you to the source materials.  Of course this is an opinion piece, but I am providing you with the facts to back up my conclusions.  Read the materials.  Please share with me your conclusions.  You may, or may not, agree with me. 

Reconciliation – This must be our starting point.  Per the Brookings Institute:

“Reconciliation is, essentially, a way for Congress to enact legislation on taxes, spending, and the debt limit with only a majority (51 votes, or 50 if the vice president breaks a tie) in the Senate, avoiding the threat of a filibuster, which requires 60 votes to overcome. Because Republicans have 53 seats in the Senate—plus a Republican vice president—reconciliation is a way to get a tax-and-spending bill to the president’s desk even if no Democrats support it.” 

We start with Reconciliation because that is how the Republican controlled Senate was able to pass H.R. 1, The Big Beautiful Bill.  This legislation could not have passed otherwise.  The bill specifically includes certain provisions, such as tax cuts for certain groups, and intentionally reduces the access to benefits, such as Medicaid.  The bill also intentionally chooses to ignore the need to extend the Patient Protection and Affordable Care Act (Obamacare) enhanced tax credits.  These were choices made by the Republicans.  There were no negotiations.  They had enough votes to pass H.R. 1 through Reconciliation. 

The expanded tax credits are addressed at Congress.gov:

“Summary

Although the premium tax credit (PTC) has been available since 2014, there is increased congressional interest in the federal subsidy due to the impending expiration of a provision that enhanced the PTC.

The Patient Protection and Affordable Care Act (ACA; P.L. 111-148, as amended) established the PTC to help eligible households lower their payments toward premiums for qualified health plans offered through health insurance exchanges. The American Rescue Plan Act of 2021 (ARPA; P.L. 117-2) expanded eligibility for and the amount of the PTC for tax years 2021 and 2022. The Fiscal Year (FY) 2022 Budget Reconciliation Law (P.L. 117-169) extended the ARPA provision for three additional tax years, 2023 through 2025.

In general, the enhanced PTC provision allowed more households to become eligible for the credit and provided larger subsidies to all eligible households, compared with ACA-only rules. As a result, federal expenditures for the PTC were larger under ARPA/FY2022 Budget Reconciliation Law rules than under ACA-only rules.

If the enhanced subsidies expire, the Congressional Budget Office (CBO) estimates a decrease in enrollees with subsidized exchange coverage resulting in a reduction in federal expenditures. CBO also estimates that expiration of the enhanced PTC would contribute to a rise in the uninsured rate.

If the enhanced subsidies are permanently extended, CBO and the staff of the Joint Committee on Taxation estimate an overall increase in exchange enrollment leading to an increase in the federal budget deficit.” 

Please note that this current online document from the CURRENT Congress details the importance of the premium tax credits in reducing our rate of uninsureds.  Health insurance is the way most Americans access and pay for health care.  

Let’s go back to the first meaningful and positive tweak to Obamacare, the March 2021 expansion of the premium tax credits to more accurately reflect the realities of the market.  This is the CNN report from March 31, 2021: 

“More help to buy health coverage

The boost in aid is part of Biden’s effort to get more Americans covered by health insurance. The relief package makes two changes to the subsidies to address long-standing complaints that Obamacare plans are not affordable for many people, particularly the middle class.

Enrollees will pay no more than 8.5% of their income toward coverage, down from nearly 10%. And lower-income policyholders will receive subsidies that eliminate their premiums completely.

Also, those earning more than 400% of the federal poverty level – about $51,000 for an individual and $104,800 for a family of four in 2021 – will become eligible for help for the first time.” 

The purpose of the change was to help Americans, to do good.  And it did.  The expanded tax credits really helped our clients over age 55.  Individuals in the early sixties, many suddenly force to purchase their own coverage for the first time, were only able to afford the purchase of health coverage because of the extended premium tax credits. 

The Big Beautiful Bill intentionally allows the extended premium tax credits to end.  Many older Americans, age 55 to 64, will no longer be able to afford comprehensive coverage.  The healthiest of them will opt for short term coverage or to be uninsured.  Both options only work if you never get sick or injured.  The unhealthiest will find some way to stay insured.  This only serves to make insurance even more expensive.  The term is Death Spiral.  In this case, the damage is intentional. 

Sequestration – Per the Congressional Budget Office:

“Sequestration refers to automatic spending cuts that occur through the withdrawal of funding for certain (but not all) government programs. CBO provides estimates of the statutory caps on discretionary funding and an assessment of whether sequestration might be necessary under current budgetary rules, but the Administration's Office of Management and Budget makes the ultimate determination of whether a sequestration is necessary and, if so, how big it should be.”

The Big Beautiful Bill adversely affects your access to health care by intentionally driving up the deficit.  This will, in turn, cause automatic cuts in the budgets of the entire social safety net, INCLUDING MEDICARE.  This is the link to the CBO response to the question, “Would Sequestration impact Medicare?”

We, meaning anyone interested in fighting to preserve our current system of accessing health care, have one last chance – the current fight in the U S Senate.  The Senate Majority Leader, John Thune, is asking the Democrats to just let everything go through for now.  There is plenty of time to address these issues in November.  No, if this isn’t addressed now, it will not be done at all. 

None of this should come as a surprise.  Many of us spent all of the summer of 2024 discussing the Heritage Foundation’s Project 2025.  My blog posts included a link to a searchable online version that helped many of us to fully understand the potential danger.  The Heritage Foundation has removed that online document.  Instead, I can provide you with the link to the Project 2025 Tracker.  Yes, someone is meticulously monitoring the dismantling of the federal government by Russ Vought, the Director of the Office of Management and Budget. 

Few would argue that Obamacare is perfect.  It was perceived to be the best legislation that could be passed through Congress at the time.  It has survived over a decade of political grandstanding and sabotage.  But the core was the attempt to help more people access and pay for coverage.  Steven Brill wrote a thoughtful piece in June 2017 that detailed nine ways to fix Obamacare.  I can’t imagine Mike Johnson having any desire to read the article, much less implement any of the ideas. 

This has been a long article, but I hope that I have put the current government shutdown into perspective.  I would like to believe that our elected representatives have our best interests at heart.  That all of these shenanigans are just a difference in perspective.  But reality used to be a friend of mine.  I’m afraid that we can no longer pretend that we are having an honest difference of opinion of how best to help the American people. 

Dave 

Health Insurance Issues With Dave

Picture – Some Things Must Be Stopped! – David L Cunix

 

When Is The Right Time To Destroy Medicaid?

 

The United States House of Representatives will be busy tonight.  The Rules Committee will be meeting tonight at 1 AM to discuss Donald Trump’s Big Beautiful Bill.  I would provide a link to this legislation, but they are keeping it under wraps.  It is like getting hit by a Tesla.  You won’t hear it coming, but you will feel the impact. 

A key reason for these late night shenanigans is the need to pass a bill that will allow the Republican majority to continue the Trump tax cuts that are expiring without, officially, raising the debt.  There are two ways to accomplish this.  The first is to fudge the actual numbers.  The second is to gut the social safety net.  This is not the kind of debate that is televised to a national audience at 1 PM. 

The Patient Protection and Affordable Care Act (Obamacare) provided for the expansion of Medicaid.  As noted in my post of June 26, 2017 Dayenu, the de-stigmatization of Medicaid and the subsequent expansion to include the working poor may have been the most important part of this legislation.  The Supreme Court ruled on June 28, 2012 that the states could choose to expand Medicaid, or not.  Ten states have yet to expand Medicaid, the most notable being Texas.  So it is no surprise that tonight, a Congressman from Texas, Chip Roy (R-TX), will be leading the charge towards bigger tax cuts and less health care.  It is always Texas. 

It might be instructive to look at some numbers for Texas in general and Chip Roy’s District 21 in particular.  To be fair, Mr. Roy is very clear on his views.  He has posted “The Case for Healthcare Freedom” on his website.  He envisions a world where you have a hundred grand in your HSA so that you could negotiate your appendectomy at the Cleveland Clinic.  The real world, especially for those who live in Texas, is very different.

The population of Texas                                             30,029,577

Percent Uninsured                                               16.6%     #1

Number of uninsured Texans                          4,984,909      #1

Fun fact – There are more people uninsured in Texas than the combined population of Delaware, South Dakota, North Dakota, Alaska, Vermont, and Wyoming.

Number on Medicaid/Chip in Texas                   5,800,000

Chip Roy’s District

Percent of population uninsured & under age 65         14%

Percent of population uninsured age 18 and under        9%

Number of uninsured in District 21                      86,377

Percent of population on Medicaid & under age 65    6.5%

Percent of children on Medicaid/Chip                        15.3%

Number on Medicaid/Chip                                      43,200

The Commonwealth Fund produces The Scorecard For State Health System Performance.  This is the link to the 2023 report.  Texas rates, as usual, near the bottom.  For those keeping score, Texas usually rates in the second half or lower on such charts as life expectancy and health rankings.

There has been an effort to pull Texas away from the likes of Mississippi, Louisiana, and Alabama.  Expanding access to health care has been a real struggle.  The Texas Standard has detailed the benefits of expanding Medicaid and, unfortunately, why it probably won’t happen in 2025.  It is estimated that over 600,000 Texans do not qualify for either Medicaid or a tax credit subsidy under Obamacare.  This is not a problem that the current Texas government nor its Congressional delegation has any interest in solving.  Organizations such as the Heartland Institute work tirelessly to leave Texas where it is.  This is the link to their Research and Commentary: Texas Medicaid Expansion.

Medicaid expansions benefitted insurers, hospitals, and providers while the population’s health worsened and average life expectancy declined in expansion states, Dr. Brian Blasé and David Balat of the Texas Public Policy Foundation found.  “The ACA significantly expanded insurance coverage between 2013 and 2017, but Americans’ health worsened during this period and life expectancy declined for three consecutive years from 2014 to 2017,” the authors write.

Of course, by their logic, if we cancel everyone’s insurance we all live forever.

The clock is ticking.  A bill will come out of the House of Representatives and if you make enough money, you might even find it big and beautiful.  The rest of us are counting on the Senate to protect the rest of America.

Dave

www.cunixinsurance.com      

Picture – Time To Insure – David L Cunix

 

Another Small Victory

 

 

It is the most American of activities, the petitioning of our elected representatives in the hope that we can get our government to enact legislation that will help us to live happier and more productive lives.  This is the essence of Capitol Conference, the annual meeting of the National Association of Benefits and Insurance Professionals (NABIP). 

I recently joined a gathering of 750 health insurance agents and industry employees in Washington DC.  As I have detailed in previous years, we were in our nation’s capital to hear from the heads of regulatory departments such as CMS, Congressmen, Senators, and thought leaders on the issues impacting us and our clients.  This year, the beginning of Trump 2.0, was particularly important.  How would the new administration try to change Medicare, Medicaid, and the Patient Protection and Affordable Care Act (Obamacare)?  Most of us had booked our rooms and flights before DOGE began to focus on Social Security and Medicare.  The news coming from Washington since the inauguration confirmed the need for us to be there in person. 

The focus for me has always been the meetings with our elected representatives.  I was honored to lead delegations to the offices of two of Ohio’s members of Congress.  Due to votes, our meetings were with the legislative aides, not the Members.  I had had the pleasure of talking again with Ms. L. Hannah, Congresswoman Shontel Brown’s Legislative Assistant.  She is well aware of the issues impacting our district.  Our other appointment was with Ms. K. Walker, MPH, Congressman Greg Landsman’s Legislative Aide.  One of the reasons I love wandering around the Halls of Congress is the opportunity to interact with the bright, talented 20 and 30 somethings who choose to devote themselves to public service.  These are our future leaders. 

Our issues – our Ask – our Talking Points are always more focused on our clients than ourselves.  It is odd, but we, the agents, are in the best position to advocate for the health care access of the average American.  Here are a few of the highlights:

·       Codify telehealth benefits for High Deductible Health Plans and Medicare

·       Advance PBM (Pharmacy Benefit Manager) reforms for lower costs and greater transparency

·       Revisit site-neutral payments which will help lower health care costs

·       Preserve tax incentives for employer sponsored benefits.  Over 175 million Americans are covered by employer-sponsored group health insurance.

·        Reintroduce COBRA as Credible Coverage legislation

There were also some suggestions to improve the enrollment process for Medicare Part D (Rx).  I would be happy to discuss any of these topics in greater detail.  That is probably better left to one on one conversations. 

What is important is that these aren’t Democratic or Republican positions.  There is nothing inherently partisan about making sure that Americans of any age can access and pay for health care. 

The House of Representatives voted last week to extend telehealth for six more months.  It wasn’t a standalone bill.  It was part of the continuing resolution.  Telehealth coverage for millions of Americans is still an option until September 25^th.  It isn’t permanent.  It isn’t even till the end of the year, but it is a small victory. 

And we should celebrate every victory, no matter how small. 

Dave 

www.cunixinsurance.com

Picture – Out With The Old – David L Cunix

Is Your Insurer Prepared For 2017?

 

It has only been 8 years, but can you count on your insurer’s institutional memory?  Eight years seems like yesterday to those of us who have been in the health insurance business for decades.  Unfortunately, many of our insurance companies are now run by bean counters.  Eight years?  Eight years ago our C-Suiters may have still been at a major hospital system or doing time at UnitedHealth Care (it appears that many of them pass through UHC), but now they are at their current insurer, the one that you are depending upon.  Are they ready?  I’m not sure.  So much of the business community has been in denial this past year.  There was an assumption within the business community, that Donald Trump, the Heritage Foundation and its Project 2025, and even Elon Musk would do nothing more than shake things up, make a lot of noise, take their cuts, AND LEAVE THEM ALONE.  That is not going to happen.  We will all be involved.    

Health Insurance Issues With Dave had 34 posts in 2017.  Almost all of these post were about the various attempts to repeal the Patient Protection and Affordable Care Act (Obamacare) without a viable replacement or the other efforts by the Trump administration to sabotage the law.  Our insurers may have already forgotten the damage of these actions.  I would like to focus on October 13, 2017, when we learned that the president had terminated the funding for the Cost Share Reduction, an important part of Obamacare.    

Today’s post will be a collection of articles about Trump’s October 2017 actions from a variety of sources.  You will learn about the unintended consequences of Trump’s style of bluster and bullying, that this “Cut” cost the taxpayer, the insurers, and YOU the consumer a lot of money.  There were no savings.  Obamacare survived.  We all paid. 

These are articles from October 2017: 

My post – Playing Chicken

Plain Dealer – Stephen Koff’s What Trump's decision to Obamacare means for you, insurers and Congress

Business Insider - Trump just made a huge move that could blow up Obamacare

NPR - Trump Administration To End Obamacare Subsidies For The Poor

CNN - Trump kills key Obamacare subsidy payments: What it means

FOX tried to put a positive spin - Trump Ends Key Obamacare Subsidies: What You Need To Know

Healthcare Finance - Trump administration ends cost-sharing reduction payments under ACA

Healthcare Triage (Video) - Trump Cuts ACA Cost-sharing Payments, Lawsuits Incoming

By October 27, 2017 the Centers for Medicare and Medicaid Services (CMS), the state insurance departments, and the insurance companies were all working to solve this unplanned for disaster.  In most states the real question was whether all rates would be increased or just the rates for the Silver Level plans.  Would this push low-income enrollees to less comprehensive policies?  How would this impact the tax credit subsidies?

Kaiser Family Foundation - How the Loss of Cost-Sharing Subsidy Payments is Affecting 2018 Premiums  This article includes the actual rate increases in a state by state section.

This last article was published on May 10, 2024 by Fanyu Liu of the Department of Economics of Tulane University in the Frontiers of Public Health.  We are still impacted by the rash decisions of 2017.  The impact of terminating cost-sharing reductions payments on health insurance plan choices

I have been accused of being overly concerned about my clients’ access to health care.  There are those who say not to worry.  Neither Trump nor his minions would really endanger the American public.  What they mean to say is that Donald Trump wouldn’t intentionally endanger the American public.  There is a huge difference. 

##########          ##########          ##########

Two other insurance agents and two insurance company employees were sitting in my office.  Three of them were excited about Elon Musk’s efforts in Washington.  I got them to admit that he hadn’t really found any fraud, but they were still sure that he had found massive waste.  I reminded them that one person’s waste was another’s important value.  After all, there are plenty of people who think that what we do, all five of us, is just waste.  

Musk and Trump talk about Fraud when, at best, they might be finding waste.  Fraud is objective.  Waste is subjective.  I’m not worried about justifying my professional existence.  I suspect that many of the so-called wasteful programs can also be justified, if given a chance.  A Republican Congressman recently said that some mistakes may be made and some worthwhile programs might suffer, but you have to break a few eggs to make an omelet.  That might be true, but Project 2025 is not a cookbook and Elon Musk is not a chef. 

Dave 

www.cunixinsurance.com

Picture – Like Water Flowing To The Lowest Point – David L Cunix

 

 

 

You Deserve The Best

The word “Meritocracy” is more of a weapon than an honest description of how our businesses, government, or even personal lives operate.  The word also directly contradicts a common phrase, “It is not what you know, but who you know”.  What we know, really know, is that the numbers are the numbers, and that in the real world, in this case, insurance, we are sometimes judged as part of a group and sometimes as individuals.  Our merit is not always rewarded.

One of the provisions of the Patient Protection and Affordable Care Act is Community Rating.  Community Rated premiums are calculated based on everyone’s medical claims within a community (or risk pool), as opposed to Experience Rated premiums which are calculated based on each person’s claims history.  Our unhealthy clients are ecstatic.  Our healthy clients complain vociferously about community rating until they endure a serious accident or illness.  We used to experience rate.  We used to underwrite each case.  Lots, really LOTS, of people were declined.  Others were charged extra or had their existing conditions excluded from coverage.  Did people prefer that system?  Yes, right up and until the moment they were told “NO”.  Some agents would like to return to that system.  I am not one of them.  I remember what it was like in 2013 and before to tell a family that we could not insure their child because of a diagnosis of asthma.  I recall underwriters saying, “Their doctor prescribe a breathing machine?  This must be serious.”

Meritocracy is fine if you are part of the favored group.

My start in this business was in Life Insurance.  As a rule, it is clean and neat.  If you die while insured, we write a check.  The process of acquiring life insurance isn’t that simple.  Most of our policies involve significant underwriting.  The issue is mortality.  Do you have a medical condition, dangerous hobby or occupation, bad driving record, risky travel plans?  Have you exhibited a behavior that violates community standards or morality (moral turpitude)?  Do you have a need for the coverage?  These factors determine whether or not you qualify to purchase a life insurance policy and at what price.

I have always been fascinated by life expectancy tables.  This blog has posted information from these tables.  Is it only a coincidence that states with mediocre health care have the lowest life expectancy?  Texas has the highest rate of uninsured adults.  As big and as rich as Texas is, the state normally ranks about 30^th in life expectancy.  Here are two National Vital Statistics Reports.  Each shows the life expectance at birth, rank, and standard error, by sex.  This is for each state, the District of Columbia, and the United States:

·         2020 – Published August 23, 2022

·         2021 – Published August 21, 2024

By the way, the Centers for Disease Control and Prevention (CDC) now has a new heading - CDC’s website is being modified to comply with President Trump’s Executive Orders.

Is there a meritocracy in life insurance?  Yes and No.  Women, as a rule, pay less than men because they have a longer life expectancy.  Accountants tend to pay less than roofers.  Your height and weight will be evaluated.  What isn’t considered is your state of residence.  If this was a real meritocracy, residents of Mississippi would pay a lot more for life insurance than a resident of Hawaii.  Review the tables and see where your state falls.  Ohio was 38^th in 2020 and 40^th in 2021.  Certain states are always near the top.  Others like Alabama, Louisiana, West Virginia, and Mississippi are always at the bottom.  There is no benefit to residents of Massachusetts to have their life insurance risk pool polluted with insurance sales to residents of Kentucky or Alabama.

I am not campaigning to have my clients, most of whom live in Ohio, to pay more for their life insurance.  This is just a reminder that our systems, business and government, are always looking to bring in a little fairness. 

What is the definition of “fairness”?  In truth, it means to give ME a benefit, price, job, or opportunity I might not have been able to access on my own.  The news has a lot of talk about fairness right now.  It might be important to remember that we are all a part of a lot of different groups.  In some of those groups we look like Hawaii.  In some we look like Mississippi.  Let’s all try to be more consistent in our applications of fairness.

May we all be meritorious in all of our endeavors.

Dave

www.cunixinsurance.com

Picture – Read Between The Lines – David L Cunix