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. 

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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