Today's Question

It is Open Enrollment here at Cunix Insurance Services. In eight short weeks I will email or talk with close to 500 people. I have six to eight appointments in my office every day. And it really doesn’t matter if the visitors are twenty-two or seventy-two, married or single, self-employed or working for someone else, everyone has the same question – WHY IS THIS STUFF SO EXPENSIVE?

That is a good question. I wish the answer was as clear as the question.

It is important to remember that health insurance is a payment system. It is our way to organize the access and payment for care. If the insurance covers more care such as a colonoscopy as part of routine preventive care, maternity and mental health care the same as any other medical condition, and preexisting conditions, the price will be higher than if those costs were excluded. We appear, as a society, to have decided that these enhanced coverages are a good thing. We may not want to pay for them, but we aren’t prepared to go back to a time of more limited benefits.

Are the insurers jacking up the rates just because they can? The short answer is probably not. The Patient Protection and Affordable Care Act (Obamacare) includes the Minimum Loss Ratio. The MLR forces the insurance companies to spend 80 cents of every dollar on claims. The other 20% pays for all of their administration, marketing (including the agents), reserves and, if there is anything left over, profits. I’d like to push this onto the Anthems, Medical Mutuals, and UnitedHealth Cares of this world, but they may not be the biggest villains of this story.

The rising cost of care is the biggest driver in the rising cost of health insurance. That free colonoscopy isn’t getting any cheaper. Lifesaving treatments come at a price. And it is all too much until that is for you or a loved one. How much does that shot or pill cost? Medications seem to be a huge and growing factor in the cost of care.

Prostate cancer is a common condition for men of a certain age. A client and I were sharing treatment stories the other day. He was shocked that he was given an $18,000 shot. Been there. Done that. The medication in that shot has been around for thirty years, but they still get $18,000! Leslie Stahl’s report on 60 Minutes this week was on the price increases for medication to treat opioid overdoses. Major news organizations have been documenting the escalating prescription drug pricing for years. With little to no real action taken in Washington to curtail the price of medication, state legislatures are trying to fill the void, but it is an uphill fight.

This is November 2018 and the only thing I know for sure is that the price of your health insurance will go up for 2019. Most of my clients are seeing increases around 10%. My Grandmothered Anthem policy went up 26% and there is nothing I can do about it. It is a monthly reminder that we are all in this together.

DAVE

www.cunixinsurance.com

Picture – David L Cunix – Why?

HOW?

The elections are over and most of the results are in. Most, but not all. A few races won’t be decided for several weeks. For good or ill, none of Ohio’s contests were that close. The winners can now begin to deliver on their promises.

The television ads for our new governor, Mike DeWine, were clear. Mr. DeWine may have had a checkered past in his defense of protecting affordable access to health care for Ohioans with preexisting conditions, but he is now prepared to champion their cause. We have his daughter’s word on it. It is time for all of us, in and out of the insurance industry, to ask “HOW?”

President Trump and his administration continue to work against one of the cornerstones of the Patient Protection and Affordable Care Act (Obamacare), coverage for Americans with preexisting conditions. The ongoing Texas lawsuit, supported by the president, is still a threat. Other actions taken last year, the defunding of the Cost Sharing Reduction and the elimination of the penalty associated with the Individual Mandate, continue to disrupt the health insurance market. And now, Mr. Trump has taken the next step to destroy your access to health insurance with new rules to allow the sale of stripped down policies.

We are looking at new rules that will make it easier to purchase short term major medical policies. These policies, which really do have a place in the market, are issued for a specific period of time, usually no longer than 6 – 12 months in duration. These policies are usually limited in nature, designed to exclude coverage for preexisting conditions, maternity, and mental health. If you push the young and, more importantly, the healthy to short term policies, then you are left with a health insurance system focused strictly on the sick and the responsible.

As an Ohioan, as an insurance agent, I wish Mr. DeWine luck. But it is time, Mr. DeWine, to tell us your plan. Protection for preexisting conditions? How?

DAVE

www.cunixinsurance.com

Picture – David L Cunix – At Least The Parking Is Free