A Glimmer of Hope?

While there is some disagreement as to the exact number of folks without health insurance, the number most commonly bandied about is 45 million. And, of course, this is a “fluid” number in that, in any given month, it is not the same 45 million. And, of further course, absence of health insurance does not equate with absence of health care. Nonetheless, this is a serious problem, and merits serious consideration. While our politicos – elected and otherwise – jockey for position(s) on addressing the problem, a disparate group of organizations, companies, and institutions have been meeting to brainstorm from a more broad-based perspective.

So, who makes up this broad-based collation? You may be surprised:

“(R)epresentatives of trade and professional groups, such as the American Hospital Association and the American Medical Association; labor organizations, such as the A.F.L.-C.I.O. and the Service Employees International Union; business groups, such as the U.S. Chamber of Commerce; industry interests, such as the Blue Cross and Blue Shield Association and Johnson & Johnson; government alliances, such as the National Conference of State Legislatures and National Governors Association; and political-advocacy groups, such as the liberal Families USA and the conservative Heritage Foundation.”

Representatives of these groups have been meeting since last October and, not surprisingly, haven’t yet solved the problem. But at least they’re trying.

What’s promising here is that these groups recognize that simply pointing the finger of blame solves very little; indeed, the fact that there is cooperation from both the private and public sectors may be what finally resolves many of the underlying issues.

An encouraging sign is that “(T)he group is leaning toward incremental solutions…an approach that might disappoint purists on the political left and right. But increments -- substantive increments -- offer the best short-term hope for progress at a time when partisan dissension, especially in Washington, has caused political paralysis on health care.” Couldn’t have said it better m’self.

This effort is only about 6 months or so old, so it’ll be interesting to see what, if any, recommendations are forthcoming. As a fan of the free-market, I would prefer to see solutions coming from broad-based coalitions such as this, as opposed to some monster thought up by our political class.

We shall see.

Late Spring Housecleaning...

First, the good news:

I've added the Haloscan commenting and trackback system.

Unfortunately, this process deleted all the previous comments -- Ooops! PLEASE don't take this personally...I really enjoy the comments here.

Have a great weekend!

He Ain’t Heavy…

Well, actually, he is. And to his credit, he wants to do something about it: he wants to undergo weight-loss surgery in order to treat his morbid obesity. Which is commendable, if drastic.

And he wants his insurance to pay for it.

Which is unrealistic.

By and large, carriers do not cover weight-loss surgery. Or stop-smoking programs, infertility treatments, or growth-hormone regimens.

There’s actually a very good reason for this: they are not issues which should be covered by medical insurance. Look at it this way: do we expect our auto insurance to cover oil-changes or transmission repairs? Do we rely on our homeowners insurance to pay for leaky roofs (I’m talking about ordinary wear-and-tear, not hail or tornadoes) or cleaning out our chimneys?

Insurance is expensive enough without adding even more overhead to plans.

Is it discrimination against obese folks?

Yes, but discrimination is not, in and of itself, a bad thing. We all discriminate: Wendy’s over McDonald’s, steak over chicken, Honda over Kia, the list goes on. Carriers discriminate against smokers and diabetics, males and females, teenagers and seasoned citizens. Risk-management means that certain classes of folks are higher risks than others, and certain medications, treatments and procedures won’t be covered, because covering them would make plans so expensive that NO ONE would buy them.

My erstwhile client directed me to ObesityLaw.com, which is “the first and premier advocacy practice devoted to representing the interests of morbidly obese persons in health care and discrimination matters.” While the site is heavy on the “sue the bastards” rhetoric, it does offer some ideas about different procedures and resources, as well. And there is apparently a pretty large grass-roots effort toward legislation to prohibit discrimination against the obese.

Nationally, there are currently 25 different bills in congress that deal with obesity issues. So it’s not easily dismissed.

My friend Bob Vineyard has pointed me to an article which really explains what bariatric surgery is - and isn't - and some of the other issues surrounding this controversial procedure. It doesn't settle the debate, but it certainly sheds additional light on the subject.

I tend to be somewhat of a purist when it comes to insurance: it’s about managing risk, and that means defining what should and shouldn’t be covered from an economic, rather than a social, viewpoint. Now, before the flaming begins: I am aware that it seems oxymoronic that an insurer won’t pay for bariatric surgery, but it will cover the resulting heart-attack and quadruple bypass.

I never said that insurance had to make sense.

But think about it: there’s no way to exclude a heart attack that’s specifically caused by morbid obesity. This is a systemic issue, and there’s no way to appropriately (and legally) word such an exclusion. Not to mention, there’s little chance that said heart attack was caused solely by the obesity; there are almost always other factors, as well.

Just food for thought.

UPDATE: Once again, a big InsureBlog Welcome to our Grand Rounds visitors. Please feel free to leave a comment, and to look around at some of the other posts here.

It’s a Weird, Weird, Weird, Weird World…

A few weeks ago, I wrote about international travel and medical insurance. And that was an interesting situation. But this one’s better. In some ways, this case encapsulates the future of the global economic model.

Imagine, if you will:

A nice, normal, middle class suburban family. Dad works in IT, Mom’s a homemaker raising their three young children in Midwest Suburbia. Dad’s a contract employee at a local firm, which contract is up at the end of the month, and he’s off to the next one.

And so, you may ask?

So, this family moved here from Ireland several years ago, and Dad’s new job is in Germany, so naturally he’s leaving for France in a few weeks to look for a house. About a month after Dad leaves, Mom and the kids “will cross the pond" to join him.

Keep in mind, none of these nice folks is an American citizen. But Dad’s employer provided health coverage while they were here, and will pick it up again after they’ve settled down in their new home in France. Meantime, though, he’ll be without coverage for a while after he leaves the US, and the family will lose theirs once he’s gone.

Following this? Me either.

Thankfully, it really is much simpler than it appears: we need one type of policy for Dad, and a similar – but different -- one for Mom and the kids. Both plans will provide coverage for a month.

The total tab for this little adventure? A little over $400 for the works. Not too bad, after all.

And people complain that insurance isn’t any fun!

It’s All in the Genes…

UPDATE: Welcome Grand Rounds visitors! Please take a look around, and feel free to leave a comment (or three).

Recently, the debate about using genetic testing in underwriting has heated up. Newswise is an online news aggregator, a sort of Lexis-Nexis wannabe. In their most recent release, they found that “40 percent of people already undergoing genetic testing are worried that participation might affect their future insurance coverage.”

Now, at first glance, this would seem to be a pretty significant problem, and an issue which the insurance industry should address.

But things aren’t always what they seem. The poll asked participants whether or not they agreed that: “(g)enetic testing is not a good idea because you might have trouble getting or keeping your insurance.”

The problem is, the question is useless. First, there is a difference in how life insurance is underwritten and renewed, and how health insurance is underwritten and renewed. So to ask about the generic “insurance” is to miss a key point.

Second, “getting” insurance and “keeping” insurance are two different animals. The “getting” part is called underwriting, and in Ohio, companies are forbidden – by law – from using genetic testing in underwriting health insurance. The “keeping” part is irrelevant, since a carrier can’t cancel your health insurance except for very limited reasons (including fraudulent claims, misrepresentation on the application, and non-payment of premiums). There is no provision for changing or canceling a plan based on the results of any genetic tests.

Life insurance underwriters may take genetic factors into consideration. Obviously, a family history of cancer, for example, is going to play a part in that process. But it is merely one tool, and – unlike health insurance – there is so much competition in the life insurance field that even if one carrier says no, there’ll be more than a few others waiting to say yes. That’s the “getting” part. The “keeping part” is irrelevant: life insurance is also a unilateral contract, and cannot be cancelled by the carrier except for those limited circumstances previously described.

But that’s Ohio. What’s happening on the national scene? Well, the Changes in Health Care Financing and Organization program, part of The Robert Wood Johnson Foundation, discusses this in their April issue. They point out that “earlier this year, Congress weighed in with proposed legislation in the Senate and the House prohibiting discrimination on the basis of genetic information with respect to health insurance.”

Senate bill S 306, introduced by Olympia Snowe, prohibits discrimination on the basis of genetic information with respect to health insurance and employment. It would apply to small group plans, individual medical, and medicare supplements. Currently, the bill is “held at the desk,” which means that it’s waiting be matched up with its House counterpart.

And speaking of the House, H.R. 1227 is the Genetic Information Nondiscrimination Act of 2005. Sponsored by Rep Judy Biggert of Illinois, it pretty much matches up with its Senate cousin: health insurers would be barred from using genetic testing results in setting premiums, and couldn’t require applicants to undergo such testing. This bill has been referred to sub-committee, and will eventually be paired up with S 306.

So far, I’ve outlined the technical and legislative aspects of this issue. But there’s more here, on a personal level. As an agent, I represent the carrier, but I work for my clients. This is a fine line, and one which is often obscured in the flurry of paperwork that is the application and underwriting process. I understand that carriers want and/or need as much information as possible to correctly price a given risk. But I also think that there is something Orwellian in the use of genetic testing to decide whether or not someone should pay more for their insurance, or even be covered at all.

Just my $.02

Anthem & Premier…A Lost Hope

A while back, I wondered what would happen when United’s contract with Premier came up for renewal. Would the two sides reach an acceptable deal, or would Premier find itself cut off from BOTH of this area’s largest carriers?

Well, now we know: United and Premier have inked a deal seven months ahead of schedule. And this one’s a doozy – a 5 year contract, instead of the typical 3 year deal. This means that United customers who use Premier providers can breathe a little easier, knowing that they won’t find themselves in the same boat as Anthem insureds. And having such a long-term agreement in place means that the stress on everyone involved is put to bed for quite a while.

Well, not for everyone. Now that this deal is in place, it would appear that United is in position to take a good chunk of business away from Anthem. Why, you ask? Well, because United’s contract was due to expire this year, there was apprehension that they’d be in the same boat as Anthem, vis-a-vis Premier. Why jump out of the frying pan into the fire? But now that those fears are put to rest, employers can feel comfortable looking to United for coverage.

And there’s this: in the months since Anthem and Premier parted ways, more and more insureds are finding that they are affected by the split. The latest brouhaha involves emergency care. In theory, under Ohio law an emergency (defined by the “prudent layperson" test) must be covered as in-network, even if services were rendered by an out of network provider. But that’s not what’s happening:

"When chest pains scared Sharon Smith into Miami Valley Hospital's emergency room, it was less than a month after her cardiac stress test had found an abnormality in her heart.
It was also four days after Miami Valley's contract with her insurance company, Anthem Blue Cross and Blue Shield, had expired after failed negotiations.
But this was an emergency. Anthem had assured customers that emergency care would be covered at network rates. In Smith's case, Anthem also approved using Miami Valley for more expensive treatment.
The bill: nearly $15,000. Anthem sent her a check for $4,520.82.
About 100 Anthem customers a month are getting similar surprises after ER trips to Miami Valley or Good Samaritan Hospital, according to officials with Premier Health Partners. Premier is the parent organization over Miami Valley, Good Samaritan and Middletown Regional hospitals."

Anthem says that Ohio law doesn’t apply in this case; they maintain that they’re regulated under federal law, not state. Premier disagrees, and has filed a complaint with the Ohio Department of Insurance.

It’ll be interesting to see how that plays out.

Empowering Ourselves...

For many of us, health insurance is provided by our employer, so we have little opportunity to access typical Consumer Driven Health Care (CDHC) products. High Deductible, catastrophic plans and HSA’s are not often available, and not every company has a knowledgeable HR person (or even any HR person) to answer questions or address concerns we might have.

But there are ways to empower ourselves and take advantage of at least some of the benefits of CDHC. Most cafeteria plans now include a high-deductible option, or one with higher co-pays for office visits. Some even offer plans with no office co-pays, where one pays a percentage (typically 20% to 30%) of these smaller claims, in return for a lower premium. By choosing one of these plans, we realize savings that can go toward paying the smaller, routine claims, but maintain the safety net portion of the plan for those unexpected “big ticket” items.

Years ago, before HIPAA, I sold quite a few MSA (Medical Savings Account) plans. Of course, these were what we’d now call “non-qualified,” which means that there were no tax benefits. But that also meant no government intervention or “gotcha’s;” one could spend the money however one chose. Folks without access to an HSA can accomplish much the same thing by diverting the premium savings into a passbook account. Or even a mutual fund, although I’d recommend choosing one that concentrates on growth, and has a conservative risk profile: this is “rainy day” money, and is likely to be needed right away if needed at all.

Another area where folks can save premium dollars is in dependent coverage. For convenience’ sake, a lot of people choose to cover their spouse and children under the company plan, even though they may have to pay most (or all) of the premium. While this may make sense for some (especially young families who think they need maternity coverage, or those who have severe medical problems), there may be substantial premium savings in opting out of the employer-based coverage for dependents, choosing instead an individual major medical plan.

It's worth exploring some of these options -- after all, it's your money!