The Compassionate Physician

A Kind-hearted Physician sitting at the bedside of a patient afflicted with an incurable and painful disease, heard a noise behind him, and turning saw a cat laughing at the feeble efforts of a wounded mouse to drag itself out of the room.

“You cruel beast!” cried he. “Why don’t you kill it at once, like a lady?”

Rising, he kicked the cat out of the door, and picking up the mouse compassionately put it out of its misery by pulling off its head. Recalled to the bedside by the moans of his patient, the Kind-hearted Physician administered a stimulant, a tonic, and a nutrient, and went away.

The above is from Fantastic Fables, a book written by Ambrose Bierce and first published in 1898 over one hundred years before Sarah Palin stumbled into the end-of-life conversation. Mrs. Palin’s contribution was to fan the fears of those worried about death panels. Mr. Bierce calmly asked us to define humane.

This post marks the four year anniversary of Health Insurance Issues With Dave. The very first edition dealt with a very, very unhealthy gentleman in his late 70’s who was in line to get a new kidney.

Did it make sense to place a healthy kidney into the body of someone that old and that unhealthy?

Should the kidney go to someone younger or in better overall health?

Should society, in this case Medicare, pay for this quixotic procedure?

I didn’t pretend to have the answers in 2009. I’m no closer today. Worse, this is a conversation that we as a country have managed to avoid. But as we change our system of health care financing through the implementation of the Patient Protection and Affordable Care Act (PPACA), we are going to have to discuss this whether we want to or not.

It isn’t always life and death. An eighty-eight year old woman visited the Cleveland Clinic last week. After examinations and tests by several doctors, nurses, and technicians, it was determined that yes, she did have a cataract, but no, she did not require immediate surgery. Still, if she wanted to have the procedure, they were prepared. Money was not a consideration. Medicare and her Medicare supplement would have covered the entire cost. She elected to wait until she had no choice.

Is it great that our elderly have such wonderful, comprehensive health coverage? I don’t know. It FEELS great. But is there a line and where is it? If we agree that all Americans have a right to unlimited care, then we must begin the process to collect the funds (taxes) necessary to pay the bill. If we want to set limits, then now is the time to start that conversation.


The subject of that first post never received the new kidney and died from one of his many ailments. I learned a lot about death this year as I watched a friend struggle with cancer. He lost that battle. I don’t know if he ever fully grasped the value of Hospice and palliative care or how much help and comfort he received in his final days. I, however, now have a much greater appreciation for Hospice and the doctors, nurses, and technicians who staff these units and facilities.

And we are left with the questions – How much medical care is needed and how much is too much? And of equal importance – Who gets to decide?

Are we ready to define compassion?

DAVE

www.bcandb.com

Fact, PolitiFact, and the Real World

Jim Renacci (R-OH) got caught. Last Thursday’s Plain Dealer called out the congressman in the PolitiFact column.

Obamacare includes "a $63 charge every American will begin paying (in 2013) as a way to cover some of the increased costs associated with providing health insurance to those with pre-existing conditions."

And this was deemed Mostly False.

So what did Congressman Renacci get wrong and why is this important?ul>

The $63 fee is part of a Health and Human Services (HHS) rule. And though this fee is as good as done, it is not done so this isn’t good.

The $63 fee is slated for 2014 not 2013.

The $63 fee is a charge each employer would pay per person covered under a group health insurance policy. The money would help defray the cost of insuring all of the unhealthy Americans who will soon be flooding our health care system.

The $63 fee is supposed to decrease over three years and then disappear.

The last point is the most amusing. How many governmental fees, otherwise known as taxes, have you seen disappear?

So, PolitiFact is technically correct. Mr. Renacci oversold his point. What he could have said is the HHS is about to impose another charge to employers to help cover the cost of the Patient Protection and Affordable Care Act (PPACA). He might have noted that HHS is making up the rules as it goes, is actively looking for funding sources, and has yet to facilitate an honest, open discussion about priorities.

Renacci was wrong and PolitiFact was irrelevant.

* * *

The health care debate is replete with faux experts and near truths. Here is what I know: Premiums are increasing, now and in the foreseeable future.

My small group clients are getting hit hard. The March small group renewals from Anthem are well over 20%. My Medical Mutual groups are seeing rate increases in the high teens. The clients aren’t interested in theories or promises. They are only concerned with the size of their monthly bills.

What is contributing to the rate jump? Some of this is the ramp-up to 2014, but the insurers will tell you that the rates reflect the reality of higher health care costs and increased benefits.

Carrie Haughawout, assistant director for health policy of the Ohio Department of Insurance, recently told the Dayton Daily News, “Ultimately health insurance rates are just reflecting the cost of health care and the cost of health care has been going up for years, so the cost of health insurance has correspondingly been going up.”

In that same article, Aetna spokesman, Scot Roskelley, blamed premium increases on “the increasing prices of hospital care, prescription drugs, doctor’s visits, and other health care services. Other underlying cost pressures – from the underpayment for government insurance to the rising rates of obesity – also drive up premiums.”

The only cost drivers Mr. Roskelley skips are all of the new free benefits that have been added to individual and small group health policies. Some people seem to believe that $3,500 colonoscopies are just gifts from the insurance fairies.

ThinkProgress found a law professor from Washington and Lee, Timothy Jost, who opined that “The cost of new benefits should not be a big deal. Most of the costs of health insurance are for inpatient, outpatient, physician, lab, radiology, and pharmaceuticals, which virtually all insurers now cover.”

At Washington and Lee, cheerleading is nine tenths of the law!

* * *

Dave Jones, California’s insurance commissioner, is really unhappy. He is allowed to jump up and down and stamp his feet, but he cannot block insurers from raising their rates. He’d like to change that. He would like California to give him more authority.

The regulatory gold standard may be New York. A recent New York Times article noted that insurers may have requested an average increase of 9.5% on individual policies, but the actual state approved increase was only 4.5%. Small group rates had an even bigger spread. The insurers proposed an average increase of 15.8% but saw that number knocked down to 9.6%.

We are left with two options. Is insurance priced the same way as trinkets at some third world tourist trap? Do the insurance companies price their products high enough so that the regulators can score well-publicized victories while the companies still receive sufficient funds to perform their primary function – insure the public? Or, did reducing the insurers’ renewal rate increases by 40% possibly jeopardize the companies’ future ability to pay claims? Are the regulators making insurance no more secure than a government program?

So which is more important to you, Renacci and others on the right overselling the new fees or the future stability of how we fund the payment of medical services? It all affects us, those of us living in the real world.

DAVE

www.bcandb.com

Cliff Diving

December 19, 2024

They were much too angry and type A to stand in line. But they waited for their turn and one by one marched to the podium, faced the few assembled Congressmen not from their states, and held nothing back. They were all there, every single member of the delegations from California, Arizona, and Nevada. 38 Democrats, 27 Republicans, 2 Socialists and a Libertarian were in total agreement. The federal government needed to act, NOW. And it wasn’t going to happen. The Speaker of the House, James L. (Jimmy Lee) Russell (R-La), had already left. There was not going to be a vote tonight. And if the citizens of California, Arizona, and Nevada were dying from a flu epidemic and needed more medical attention than was currently available, well it was, in part, their fault for not being smart enough to live in Louisiana.

Hell, everyone should live in Louisiana, except of course, that damn Socialist.

The idea that the House of Representatives would adjourn without completing the people’s business would seem absurd to anyone who wasn’t paying attention to the drama of the last few days. But last night I watched the delegations from New York and New Jersey, Democrats and Republicans alike, shake in fury at the idea that Speaker John Boehner (R-Oh) would adjourn prior to allowing the vote for emergency relief for the victims of Hurricane Sandy.

As we march towards the nationalization of our health care delivery system, I again wonder if the people in Washington are up to the task. I know, I’ve met many of the suits at the major insurance companies. They don’t instill unqualified confidence, but the insurers seldom suffer from the self-inflicted wounds that our current leaders have mastered.

Our Republican leaders have attempted to starve the government. They have tried, with a great deal of success, to lower taxes without reducing expenses. Now that the election is over, we are hearing about entitlement cuts. We are learning that the Republicans seem to believe that Medicare, Social Security, and Medicaid are the sources of our financial problems. Defense, government subsidies to favored industries, and revenues should be off the table. What happens when our health care is just one more line item on the budget and the choice is adequate funding or the happiness of a few large campaign donors?

I don’t like our odds.

And my fellow Democrats aren’t any better. There is no such thing as free. And though a modest increase in the taxes some of us pay may not hurt (too much), the truth is that you can’t tax your way out of this mess. That and we seem to fixate on the low hanging fruit. Most people don’t mind increasing the taxes on other people. If we really need the money so badly, why not ask everyone to chip in? Pick a number. $5 a week from the paychecks of everyone making under that $250,000 threshold? Something. Anything. Shared pain seems to mean someone is in pain and the rest of us will watch and pretend to feel bad.

It is difficult to not feel frustration after watching the New Year’s Eve mess. I was transfixed. I couldn’t help myself. I kept waiting for our country’s leadership to lead. In the end it fell upon Minority Leader Mitch McConnell (R-Ky) and Vice President Biden to craft a deal that could pass. I was not surprised to see Joe Biden ride in (limo not horseback) to save the day. McConnell’s participation was a pleasant surprise.

But nothing is really solved. The US government is run by people unwilling and unable to craft a realistic budget, a doable system of taxation and tax collection, and a logical strategic plan. This is nothing new. What is new is that we are less than ten months from the implementation of the Patient Protection and Affordable Care Act. The federal government will be running the exchanges in states like Ohio where the governor thought that a President Romney would make all of this moot. How politicized, underfunded, and uncertain will our health care funding become?

I think we will all be cliff diving.  

Dave  
www.bcandb.com  

Buried Deep Within The Law

December is my busiest month. The majority of my business clients prefer to renew or change their coverages as of January 1^st. New deductibles. New Benefits. New Year. So wasting forty-five minutes of my time by taking a meaningless class and test were not on my agenda. But there I was, staring at the computer screen, plowing through the mindless drivel that the federal government feels every agent needs to review annually. AML training – anti-money laundering for the uninitiated.

Long before then Speaker of the House Nancy Pelosi told her colleagues that they needed to vote for the Patient Protection and Affordable Care Act “we have to pass the bill so that you can find out what is in it, away from the fog of controversy”, we were given Uniting and Strengthening America by Providing Appropriate Tools Required To Intercept and Obstruct Terrorism Act of 2001. You know it as the USA Patriot Act. A reaction to 9/11, it was signed into law by President Bush on October 26, 2001. It wasn’t until years later that the American people and the Congressmen who voted for it learned about the government’s new ability to legally spy on US citizens and the provisions concerning torture. And for the financial services industry – AML, the anti-money laundering rules.

Section 352 of the USA Patriot Act includes the requirement that financial institutions establish anti-money laundering internal enforcement. Each company must:

Develop internal policies, procedures, and controls

Designate an AML compliance officer

Institute ongoing training

Install an independent audit function to test the program

The insurance industry regulations went into effect on December 5, 2005, over four years after the law’s passage. Some of the rules make sense. Some are the result of regulators gone amok. Let’s be serious. Prudential is not worried that I am going to take three non-sequentialed numbered money orders, each for $5,000, and open up a life insurance policy for some drug kingpin. Pru is petrified that a federal regulator would find an agent operating without an up-to-date AML certificate.

Rome is burning and we are too busy inspecting the fire extinguishers to have time to use them.

The Patient Protection and Affordable Care Act (PPACA) is a complex law. It has to be. You can’t rework a sixth of our economy with a short paragraph and an emoticon. The new fees (taxes) to give this a chance to succeed are just about to begin. Rules and regulations are being written and promulgated. The exchanges are to be up and running in less than a year. Everyday brings something new.

One of the new taxes, creatively named the Health Insurance Tax (HIT) is designed to raise $100 billion over the next ten years. This is a tax on health insurance companies levied, in part, on market share. A study conducted by Oliver Wyman for the industry group America’s Health Insurance Plans (AHIP) predicts that this excise style tax will result in significantly higher premiums. This should come as no surprise to anyone who has been paying attention.

Other new taxes and fees debut next month.

The major insurers are trying to learn not just what the new rules will be, but when these rules will begin. Does your current policy, purchased under a different set of regulations, end on December 31, 2013? Or, will you be allowed to keep your current policy till its annual renewal or even longer? Do you care? YES!

If you are young. If you are healthy. If you don’t need any of the new benefits required of all future individual (self-pay) policies such as maternity or habilitative care, you will want to hold on to your current health insurance with both hands. Will you be allowed to retain your current policy? For most of you the logical answer is “Not for long.” These are the issues I’m asked about daily.

Over the next ten months we will get a clearer picture of the new health insurance market, the policies, the distribution system, and eventually, the pricing. This has always been, first and foremost, about paying for medical services, not about the practice of medicine. But the delivery of health care will change as the money changes.

Look around you. It would be very crowded here in Greater Cleveland if our population grew at the same rate as our hospitals and clinics expanded. Kaiser Permanente, The Cleveland Clinic, and University Hospital must believe that they know how to make the Patient Protection and Affordable Care Act pay off for them.

The potential to build health care empires must be buried deep within the law. We, however, are probably just working the mine.

Still Stuck Inside

Will you indulge me? Will you return with me to a post I wrote on August 21, 2009? That post, Stuck Inside, was about an insurance agent, me, trying to give a quick, off-the-cuff answer to the question, “So, what would you do?”

What would you do? That is the real question. It is incredibly easy to shoot down everyone else’s ideas. All ideas, born from the minds of imperfect humans, have flaws. And the more complicated the ideas, the more potential there is for mistakes. All of our plans have big, gaping holes. So designing a solution to any problem opens you up to derision. It is easy to do nothing. It is even easier to do nothing but snipe at those flawed ideas and the people who created them.

This blog has consistently held that the Patient Protection and Affordable Care Act (PPACA) is a poorly written law that lacks both transparency and logical goals. Either the eventual plan is to have us in a national health plan or our guys in Congress are getting directions from Moses’s map maker. Flaws? We got ’em. But most of the people fighting the PPACA have spent their time picking the low hanging fruit and defending the status quo.

This blog has contended that the PPACA is not only the law of the land, but that it was never going to be overturned. Deal with it. Kathleen Sebelius, Secretary of Health and Human Services, is busily churning out new rules and regulations. Some of these edicts from on high will help the American people. Some are patently absurd and will, hopefully, be changed. No matter, we need to start to prepare for a future that will soon be upon us whether or not we want it or are prepared.

My August 2009 post, seven months prior to the passage of the PPACA, laid out a program where health insurance would be guaranteed issue, would cover all preexisting conditions, and would be mandatory. My off-the-cuff solution also included the concept of creating a limited number of uniform plans that would be easier for the consumer to understand, easier to compare, and would include preventive care.

The President’s plan includes many of these ideas. I may quibble with what is included in the standardized plans and what all was thrown in to the preventive care catch-all, but THEY DIDN’T ASK ME. And you might not be a huge fan of the specifics had I been the author of the plan.

The Exchanges are currently designed to offer four levels of coverage – Platinum, Gold, Silver, and Bronze. We are still getting information on plan design and specifics. My last post covered the Essential Health Benefits that each plan must include. The difference will simply be the percent of coverage paid by the insurer and you.

The Cunix option included the idea of Medicaid being opened up to people earning up to 300% of the poverty level, paid on a sliding scale. The PPACA provides premium support and/or tax credits through the exchanges for people who earn up to 400% of the poverty level. That would mean a family of four may receive a tax credit for purchasing a policy through the exchange even though they have a family income of $92,200 (2012). By pushing individuals to the exchanges and making the premium support federal money, Washington has eliminated any potential problems or fights with recalcitrant Republican governors.

My program included a number of starting places to create cost controls. The PPACA is eerily silent when it comes to controlling costs. But then again, there is a lot of wishful thinking built into the PPACA.

The HHS has been dropping new rules on an almost daily basis. Last week it was announced that the federal government will be charging user fees to the insurers who market policies through the exchanges. These (premium taxes) fees, approximately 3.5%, will be on top of the new taxes imposed on a national basis to all health insurers as determined by their market share, and any state and local insurance tax. Some of this makes sense. This is how the Obama administration expects to pay for this transition and the ongoing process.

Here is the fun part as it appeared in the New York Times:

Erin Shields Britt, a spokeswoman for Ms. Sebelius, predicted that insurers would not raise prices. “Exchanges will provide already profitable insurance companies with access to 30 million new customers while cutting down insurers’ marketing and advertising expenses,” Ms. Shields Britt said. “Exchanges force insurance companies to compete and drive down costs for consumers. The congressional Budget Office has estimated consumers will save up to 20 percent on their premiums.

And J. R. R. Tolkien wrote non-fiction.

But sniping on the sidelines isn’t going to help. Jumping up and down and threatening to repeal the PPACA (attn: Republican run House of Representatives) only made things worse. Now is the time to talk to your Congressional Representative. The course can’t be reversed, but it can be modified. The Patient Protection and Affordable Care Act is an open-ended medical spending spree guaranteed to make private insurance untenable. Will our elected officials, Democrats and Republicans, work together to create effective cost controls, common sense limitations, and robust fraud enforcement? Those are just for starters.

Now, before we’re stuck.

DAVE

www.bcandb.com

It's Novermber and Everybody's Busy (Too Busy to Talk)

The days before Thanksgiving are a time of unrelenting activity. Some people are finalizing the big meal for Thursday. Others are preparing for the December holidays. In fact, I’ve been told that there are even elves working overtime somewhere near the North Pole. Thanks to climate change they are wearing Hawaiian shirts, but they are still working hard.

Speaking of working hard, the folks at the Department of Health and Human Services (HHS) have been very busy this week. On Tuesday, November 20, 2012, our busy elves at HHS released a new set of rules and regulations designed to flesh out the Patient Protection and Affordable Care Act (PPACA).

Tuesday’s new rules and regs cover a host of areas from defining the benefits to creating the framework for future premiums and options. You can find the public relations version of all of this at healthcare.gov. Don’t worry about going to the government’s website. This will all be coming to you – on TV, on billboards, and door-to-door solicitation, if necessary – thanks to a special campaign.
The new rules reaffirm the definition of the Essential Health Benefits (EHB). The PPACA demands that all policies offered for individuals and small groups provide coverage for a “core package of items and services known as Essential Health Benefits. EHB must include items and services within at least the following 10 categories”:

1. Ambulatory patient services
2. Emergency services
3. Hospitalization
4. Maternity and newborn care
5. Mental health and substance use disorder services, including behavioral health treatment
6. Prescription Drugs
7. Rehabilitative and habilitative services and devices
8. Laboratory services
9. Preventive and wellness services and chronic disease management
10. Pediatric services, including oral and vision care

Most of this looks pretty reasonable. Though you may wonder how much that maternity benefit will add to the cost of a woman’s policy. And if that woman can’t have children, how much is she wasting?

Employer sponsored group health policies have included maternity “covered as any other illness” for years. We know how to evaluate the risk and how much each policyholder needs to pay. That is, after all, the concept of insurance – evaluate risk and share the cost. What happens when the risk is open-ended? How do we share an unknown cost?
#7, above, is coverage for rehabilitative and habilitative services and devices. We are all familiar with rehabilitative care such as physical therapy which is designed to restore the patient to his/her former state of health and previous level of skills. The current fight over rehabilitative care is about the number of treatments. Today’s policies cover 15, 20, or maybe 25 visits to the physical therapist. We don’t know if future policies will be allowed to have such limitations. But rehabilitative coverage is much easier to assess than habilitative.

Habilitative therapies create skills. Teaching an autistic child to interact with his/her peer group is a wonderful thing. In fact, improving social skills and communication is life-changing for the children and adults touched by autism and certain forms of mental illnesses. Those suffering from other illnesses or conditions, such as cerebral palsy, have had their lives improved through habilitative care. Much of this has been open-ended, where patients weren’t actually cured, just made better. So as long as someone was willing to pay for services, another appointment was warranted.

Both the government, through Medicare and Medicaid, and the insurance industry have fought habilitative care for decades. The insurance industry lives by black and white. Habilitative therapies exist in a grey area. The industry has avoided paying for much of these services by labeling them experimental or educational. That may end soon.

Do you care? Is this good? As always, the answer is Yes and No.

Please don’t get distracted by the pictures of your neighbor’s autistic child. This has very little to do with her. It is important to remember that the healthcare debate has very little to do with health. With the possible exception of someone personally touched by a particular condition, this is, and always has been, a discussion of how we compensate doctors and hospitals. Who gets paid from the deep pockets and who doesn’t.

The insurance industry is still trying to retain the right to offer a stripped down contract that will exclude some of the open-ended coverages. It is far easier to price a policy that has fewer gray areas. A policy that doesn’t cover habilitative services; a policy that doesn’t pay for infertility treatments; a policy that included some limitations for rehab, would be significantly less than the federally mandated coverage. My guess is that we won’t have that option for long, if ever.

Seeing how much these other benefits add to the cost of coverage would force us to finally have a national discussion about our priorities. What are we willing to pay for? It still appears that no one in Washington, Democrat or Republican, wants to have that discussion.

And who can blame them? It’s November and everybody’s busy. Way too busy to talk.

Sorry, You're Screwed

The letter came from The State of Ohio, The Ohio Department of Insurance, and Medical Mutual. Good news never comes with that many names on the top of the letter.

We are sorry to inform you that your Ohio High Risk Pool coverage will be canceled at the end of the day on November 30, 2012.

The letter was dated November 12, 2012.

Some of the unhealthiest residents of the State of Ohio were being tossed off their insurance policy, the Ohio High Risk Pool. In less than three weeks they would no longer be insured. And nobody is standing in line to cover them. How could this happen?

The Ohio High Risk Pool is part of the Patient Protection and Affordable Care Act (PPACA). A stop gap measure, the states were charged with the duty of offering coverage for the chronically uninsured suffering from significant preexisting conditions. The federal government also provided five billion dollars of which Ohio received $152,000,000 for the four year program.

To qualify for the Ohio High Risk Pool you must prove:

1. Citizenship
2. That you have not been credible insurance coverage for at least six months
3. That you have been declined by two insurers within the last six months
4. You may skip #3 if your medical records show that you have a major illness that would have gotten you declined

You can not have had credible insurance coverage in the six months leading up to your application for coverage under the Ohio High Risk Pool. This is a federal requirement. Neither the State of Ohio nor Medical Mutual of Ohio, the insurer running our plan, has anything to do with this rule. Some people who are not easily insured have purchased supplements, a better than nothing option. If something happened while they were attempting to find real insurance or qualify for an affordable program, these responsible people were trying to do what they could.

My friend Dave is a conscientious insurance agent. He took a letter from American Medical and Life Insurance Company (AMLI) to the Ohio High Risk Pool. The letter, dated February 11, 2011 was sent to clients to advise them that their policy was no longer HIPAA credible coverage. Dave verified that since the AMLI CoreValue policy was no longer credible coverage, his clients, including family members, could retain this minimum semblance of coverage until they had six months of no real insurance and could enter the Ohio High Risk Pool. NO PROBLEM.

It is those people, those responsible people who attempted to have some coverage, no matter what, who are being kicked to the curb. The letter from the State specifically notes:

Our records indicate you were enrolled in an AMLI policy in the six months prior to enrolling in the Ohio High Risk Pool Program. Therefore, CMS directed us to cancel your coverage because you are not eligible for this program.

The PPACA is a poorly written law. We know that. Worse, the rules and regulations are being written on the fly. What complies one day is non-compliant the next. We went through this with the grandfathering rules. The costs, both human and financial, can’t possibly be calculated.

The Ohioans being kicked out of the High Risk Pool did nothing wrong. They followed the rules of that moment. We are talking about individuals who are gravely ill. What do they do now? 

DAVE
www.bcandb.com