Archive for health insurance
Why is business expected to pay for healthcare in the US?
Posted by: | CommentsI’ve asked this question frequently over the years, starting in the ’80s, continuing to today … and I’ll keep it up until someone realizes that it’s a failed paradigm.
What we have here, kidz, is what happens when a society decides that socialism is anathema, but doesn’t empower and educate its citizens about how to take responsibility for themselves in ways that will keep them healthy, productive community members.
Business started picking up the tab for healthcare during World War II, when stiff wage controls made it impossible for defense plants to give their employees raises. In place of more money, they started to pay for health insurance – which state and federal government were more than happy to turn into mandated employee benefits over the next 20 years.
What happened then was predictable: three generations have been out of touch with the true cost of healthcare, and the true cost of their choices about their health. If you’re a good little American consumer, you do whatever your television tells you to do: eat this. Buy that. Otherwise the terrorists win!
Three generations of disconnection from the real costs of our medical care have delivered us an epidemic of obesity – thanks to plentiful empty calories, courtesy of agri-business, and our willingness to beach ourselves on our sofas, in our SUVs, or at our computers, the better to receive more messages about what we should buy and eat.
Health insurance costs have skyrocketed as we’ve become a nation of couch potatoes. Companies are scaling back their employee health benefits as those costs continue to rise, putting more and more people in the un-insured or under-insured bucket.
Here’s a suggestion: sell health insurance like auto, home, and life insurance are sold. Put consumers in charge of shopping for, and purchasing, their own insurance. Let business help their employees, if they choose to do so, as a true benefit rather than a mandate. Help every consumer set up a Health Savings Account for their healthcare expenses. And stop the state-by-state divvy-up that lets health insurers essentially gerrymander the health insurance marketplace.
Put consumers fully in charge of their insurance, and their care. Turn the health insurance market into a car-insurance model. People can buy minimum levels of insurance, and assume the risk of that choice. They can opt out completely, and assume all the risk for their healthcare costs. Make it a true marketplace, rather than the giant mess that we currently call health insurance.
Radical? Perhaps. Necessary? I’d say it’s essential.
Until we’re put in touch with the costs of our healthcare, we won’t be encouraged/empowered to take control of our health. As long as we’re using other people’s money to pay for healthcare, we’re stuck where we are.
Which is a very bad place to be.
That’s my story, and I’m stickin’ to it …
How far would you go for medical treatment?
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No, not how far you’d go in the Denzel Washington/John Q/hold-a-hospital-hostage sense. In the get-on-a-plane-toward-care sense.
Medical tourism has seen an exponential rise with patients in the US as health care costs and the number of uninsured patients have risen over the last 15 years. In a TIME magazine piece in 2006, Curtis Schroeder, CEO of Bumrungrad Hospital in Bangkok – somehow, I don’t think he’s Thai – said that in 2005 their census of US patients rose 30% (to 55,000).
That trend has continued, even with the advent of “health care reform” – health insurance reform, really – since health care costs have continued their hockey-stick rise, with no end in sight, for two decades.
50 years ago, patients from across the globe saw health care in the US as the holy grail. Now, US patients are traveling to Costa Rica, Thailand, Mexico, New Zealand, even Cuba to get access to high-quality, low-cost care.
US companies have started to explore medical tourism, and some are offering incentives to their employees – incentives including getting to pocket some of the savings gained from traveling abroad for treatment. Not enough, however, to make medical tourism a healthy industry here in the US of A.
An August 2011 article in Workforce Management includes a story about a nurse in Louisiana (irony is our favorite thing here at Mighty Casey Media) who traveled to Costa Rica a few years ago for dental work, including oral surgery. She paid $2,700 out of pocket for what would have cost her $10,000 at home, with her employer covering $1,500 of her care expenses. Her net cost for the procedures was $1,200, plus her travel expenses – which travel was negotiated and arranged by a broker, Companion Global Health Care Inc.
I’m sure that, even after travel expenses, her savings were still solidly in the thousands of dollars.
So why aren’t more US companies encouraging their employees to take advantage of medical tourism? According to the CEO of Companion Global, David Boucher – who certainly has a dog in this fight, and who is quoted in the Workforce Management article linked above – the rising costs of health care make the health-tourism choice a no-brainer. He says that their customers are seeing a 2- or 3-to-1 return on investment for medical tourism, and patients – their customers employees – are very satisfied with the quality of their care.
However, according to Joe Marlowe, senior VP of health and productivity at the risk-management and HR consulting firm Aon Hewitt who’s also quoted in the WM story, employers are risk-averse, particularly at the idea of making themselves liable for medical care far from home that turns out badly for the patient.
What do you think? Would you travel 8,000 miles for a knee replacement, or 3,000 for chemotherapy, to save a significant amount of money and still receive high-quality care? Or would you want to be closer to your support system – family, friends – while receiving care?
I would most certainly travel to Bangkok or San Jose for a knee replacement. Not sure about oncology, since that follow-up can be so long-term.
You? I really would like to know.
That’s my story, and I’m stickin’ to it …
Did someone say “disruptive”?
Posted by: | CommentsI’ve been a disruptive woman for most of my life. Now I get to own that tag officially – I’ve joined the blogroll over at Disruptive Women in Healthcare. As of today, I’m the headline story 
It IS my story. And I’m stickin’ to it…
The Story on Healthcare Reform…After 11/2/2010
Posted by: | CommentsI attended a great Disruptive Women in Health Care event last week: Health Reform After the 2010 Election – Assessing the Viability of Health Insurance in the Aftermath of the Mid-Term Elections.
A big title, but it’s a big topic.
In a series of panel discussions, a varied group of healthcare policy wonks and a smattering of journalists offered their perspectives on what the future of healthcare payment & health insurance reform is, given that control of the House is now in Republican hands, and the Senate super-majority won by the Democrats in 2008 is history.
With the economy in the tank since before the 2008 election, and little to show for the massive injection of federal money to bail out the financial markets and the auto industry (other than a continuing 9+% national unemployment rate), it still seems quixotic that the Obama administration picked healthcare reform as its first big policy project.
Dan Gerstein, a Forbes columnist and former legislative aide to Senator Joe Lieberman, said during the first panel discussion, “this was a perfect storm of bad execution on the part of the Democrats.” With the economy and jobs a much larger, and more personal, issue to most of the electorate, the 9 months it took to push the healthcare reform act through Congress took a big toll on the public’s perception of the Obama administration.
Which, in turn, took a big toll on the Democratic Party’s results on Nov. 2.
Now, whither healthcare reform? It seems that the watchword will be replace, not repeal.
Nancy Johnson, who served 24 years representing Connecticut in the US House and is now a public policy advisor at Baker Donelson, said, “people are beyond parties now. Two things have gone fundamentally wrong: endless use of credit, which has led to fiscal collapse.” That translates to an unwillingness, particularly on the part of the states, to fund healthcare reform as it currently stands.
Now that the President will have to deal with a much less amenable Congress, Jim Slattery, a six-term Congressman from Kansas and now a partner at law firm Wiley Rein, said, “the President has a tough choice to make, and only a few weeks to make it. Confrontation or cooperation?” He noted that in a democracy, “compromise is a great substitute for violence,” but I wonder how much of a figurative beating the desire for systemic healthcare reform will take in the name of compromise.
Stay tuned on that one.
The second panel discussion spoke directly about the issue of health insurance: access/availability and affordability. One of the central issues facing the health insurance market is this: if the government is mandating insurance coverage, redefining the role of insurance agents and brokers will be an interesting battleground.
David Reynolds, President & CEO of Coventry Health Care in Maryland and Delaware, thinks that those agents and brokers would be ideal navigators of the new system. But how will they be remunerated for serving as navigators, particularly on the lower end of the market?
Slattery said that moving healthcare toward a utility model, where public utilities are private companies operating under public regulation on price and access, might be the right answer. Add to that the idea of moving the healthcare delivery system from an illness-treatment to an illness-prevention model and we might see some actual bending of the cost curve.
The session wound up with a discussion of what the insurance market might look like with the new Congressional landscape. Janet Trautwein, CEO of the National Association of Health Underwriters (NAHU), which represents more than 100,000 employee benefits and health plan management professionals across the US, echoed Reynold’s statement that agents and brokers were valuable advisors to companies working to understand the impact of the healthcare reform act. She also noted that the staggering $1Trillion-with-a-T price tag of reform was just the government share of the financial impact of healthcare reform.
Leslie V. Norwalk, who served as Acting Administrator for the Centers for Medicare & Medicaid Services (CMS) in the George W. Bush adminstration, observed that companies might elect to pay the $2,000-per-employee fine for not offering healthcare coverage to their workers, since coverage typically costs between $3,000-$8,000 per employee per year. Even if they pay the fine, and offer their workers $1,000 each toward buying their own insurance, they’d at least break even – and they might save a significant amount of money.
Think of it from the perspective of a Fortune 50 who employs more than 100,000 people – get my drift?
Did the folks drafting the legislation even think of that possibility when structuring it? Were their calculators broken?
My take-away from the morning’s discussion – which I have to say I was delighted to have been in the room for – was that both sides of the aisle believe that the healthcare payment system in the US has fallen, and it can’t get up. The issue at hand now, with the new Congressional balance of power, is how to tweak/replace/re-tool needed reform without increasing the federal debt, and while simultaneously creating a system that truly offers access to all.
I’m a believer in the consumer-driven model, with HSAs for everybody. Encourage people to be active consumers, not passive meat puppets, when it comes to their health and healthcare. Will Congress agree? Stay tuned.
That’s my story, and I’m stickin’ to it….
Here’s some video of the morning’s events:
Disruptive Women Panel #1 – November 3, 2010 from Amplify Public Affairs on Vimeo.
A Modest Proposal (on U.S. Health Insurance)
Posted by: | CommentsThis is a guest post by Hank Keiser, an accounting and hay-farming expert (don’t laugh, you need both in the farming biz today), who has a great idea on how to resolve two thorny issues with one bold stroke.
If you will give me 5 minutes of your life, I will give you a health care plan that will work.
When U.S. taxpayers bailed out AIG, we got 80% of the stock in return. We own the corporation. Why not make it work in the best interests of the shareholders?
AIG is licensed to sell insurance, through its subsidiaries, in all 50 states. Why not sell health insurance that covers pre-existing conditions, is not employer dependent, and does not drop you (or jack your rates) if you need to use it?
Isn’t that what just about everybody wants? Wasn’t that the original intent of Mr. Obama’s plan, before it got turned into a Christmas tree by the Senate?
Doesn’t this cut the legs out from the opposition’s arguments? After all, this is not a tax-driven, big-government piece of legislation.
It has zero negative impact on the deficit, is provided by a corporation, not a government agency, and requires absolutely no legislation to enact.
In fact, it’s pure (if there is such a thing) capitalism at work – without the greed factor.
AIG doesn’t have to pay dividends, so it can plow any operating profits back into the business. It doesn’t have to pay bloated salaries, bonuses, or country club fees. It will operate with a lower overhead, hence it can charge less. Much less.
You start off by moving the management of Medicare to AIG, then all Federal government employee health insurace, then state and local government employee insurance, and finally private group and individual health insurance, all under the umbrella of a corporation. A corporation owned by the taxpayers, providing a competitive product in the marketplace. A corporation that would manage the insurance of maybe 200+ million people. That’s a pretty big pool to spread the risk.
There is a huge political upside to this – it doesn’t have to be legislated. It doesn’t care if you are a citizen or not. If you want a plan that restricts coverage for abortions, there will be other providers out there who will compete for your business.
And it is bullet proof – no bank, no financier, no corporation, no tea-bagger can scream socialism, because it is not socialism. Nobody on Wall Street turned down TARP money when it was offered, none of AIG’s creditors lost a penny in the settlements they received.
Oh, we promised not to interfere with AIG’s management when we bailed it out? Too bad, promises are broken every day on Wall Street. If you can dish it out, then you can learn to take it.
Who loses? WellPoint, Cynergy, et al. And Joe Lieberman – he loses big. Real big.
No one is saying WellPoint and the rest can’t offer health insurance that is better than this plan. After all, they aren’t being legislated out of business.
They are just going to confront honest, open competition for the first time from a publicly chartered corporation that we had stuffed down our throats because it failed to price risk correctly.
