The Health Insurers have already won

[ERD50]

Quote:

Originally Posted by M Paquette In my case, the quote for a family insurance plan that we could get ..... comes to about 24,000/year. That's considerably more than the gross pay of someone at the poverty level. ...

After talking about vouchers, I did a small bit of research to see what a voucher for everyone would actually come to. Found several sources refer to the US spending ~ $2.2T (2.2x10^12), or $7,400 per capita, which all adds up with a 300M population.

So that means (unless a public option actually does lower costs substantially), that each and every person would be need a $7,400 voucher. Family of four would be $29,600. That is a huge amount to pay, if we say that those who can afford to need to pay their way. My current contribution plus company contribution is far below that ( ~ $10K to cover 2 to X family members).

But bottom line (unless I got the math wrong), that is exactly what we are paying (on average), one way or the other. Since I paid the same rate for a family of 5 that a person with a family of two would pay, I've apparently been "subsidized" by my company (and fellow workers) for a long time.

If that number was really transparent to people, I think something would change for the better pretty quickly. But it seems to be getting buried in the debt, making it very abstract for most.

Martha, you have mentioned that "pay as you go" is part of the current proposals. I haven't heard much about that - do you have any references you could share, I'd probably miss it if I looked through 1000 pages of multiple proposals? If that is the case, it should be brought up more as it is critical, IMO. I'd need to dig up the link, but I read a Q/A about spending "triggers" to hold down costs on Medicare, and it struck me as a lot of smoke-mirrors. I'm concerned that any "pay as you go" might be just a sham once we see the details. But I can hope. TIA.

-ERD50

[ziggy29]

Quote:

Originally Posted by ERD50 So that means (unless a public option actually does lower costs substantially), that each and every person would be need a $7,400 voucher. Family of four would be $29,600.

If someone assumed the same price per person, true. But the way health insurance is priced today, a single adult with five children can often get a lower premium than a married couple with no children.

I know that's true in the plan where I work. The "Employee plus children" rate (regardless of the number of children) is considerably cheaper than the "employee plus spouse" option. So to some extent we'd have to see if this reform changes to a true "per person" model or if there are just a few different tiers for "individual", "individual and kids," "individual and spouse" or "individual, spouse and kids."

In reality for many people, the health insurance business heavily subsidizes large families.

[ERD50]

Quote:

Originally Posted by ziggy29 If someone assumed the same price per person, true. But the way health insurance is priced today, a single adult with five children can often get a lower premium than a married couple with no children.

Exactly - and isn't this just adding to the distortions of what HC is costing us, and making it harder to see "solutions"?

Maybe vouchers could/should be based on age (they would still need to add up to ~ 2.2T)? But I would think that covering 10 children would be the same whether they are in two families of five kids each, or 10 families with one kid each.

-ERD50

[Gotadimple]

Quote:

Originally Posted by ziggy29 If someone assumed the same price per person, true. But the way health insurance is priced today, a single adult with five children can often get a lower premium than a married couple with no children. I know that's true in the plan where I work. The "Employee plus children" rate (regardless of the number of children) is considerably cheaper than the "employee plus spouse" option. So to some extent we'd have to see if this reform changes to a true "per person" model or if there are just a few different tiers for "individual", "individual and kids," "individual and spouse" or "individual, spouse and kids." In reality for many people, the health insurance business heavily subsidizes large families.

Ziggy,
I would think that if we aren't able to change the payment model (piece work), then the tiers you noted will still be there. If on the other hand there are no pre-existing conditions and no one can be cancelled and the number of people coming on to plans is significantly high, the actuaries may be able to devise a single rate per person.

Right now in most states, the age tier is the driver in premium differences, that is, in a plan like yours the insurance company has received info about the average age of employees and thus uses that to construct the rates at the different tiers. Then, your employer is also contributing to the plan and that makes the difference in the premiums as well.

-- Rita

[ziggy29]

Quote:

Originally Posted by Gotadimple Right now in most states, the age tier is the driver in premium differences, that is, in a plan like yours the insurance company has received info about the average age of employees and thus uses that to construct the rates at the different tiers. Then, your employer is also contributing to the plan and that makes the difference in the premiums as well.

No wonder age discrimination is so rampant....

[M Paquette]

Quote:

Originally Posted by ERD50 But bottom line (unless I got the math wrong), that is exactly what we are paying (on average), one way or the other. Since I paid the same rate for a family of 5 that a person with a family of two would pay, I've apparently been "subsidized" by my company (and fellow workers) for a long time.

Yup. What you are seeing there is the implicit subsidy in pooling risk over the group of employees participating in your insurance. The healthy 24 year old single guy who hasn't seen a doctor since he moved out from home in Accounting is putting in the same amount of cash as the 64 year old divorced chain-smoker over in Sales.

Looking at this on the current year only the 24 year old is subsidizing the 64 year old. Note however that the 64 year old has been buying insurance for 40 more years than the 24 year old, and 40 years ago was likely subsidizing someone else. The actuaries at insurance companies are well aware of this.

Now, if you don't like the idea of the implicit subsidy in this setup, we could alter the actuarial model to look more like long term healthcare, a vertical one-subscriber-over-many-years model instead of the horizontal all-subscribers-in-the-same-age-bracket model. Payments and profits would stay the same for group plans, but now it would look like your younger self had subsidized your older self, which some folks find more acceptable.

Ideally we'd make insurance portable instead of tied to employers to make a vertical model appear more 'real' to customers. This would also allow individual buyers to have the same constant (outside of healthcare cost inflation) rate, rather than being bumped periodically into more expensive age brackets. (Think of it as whole life insurance for healthcare. )

[IndependentlyPoor]

Now here ia an idea that maybe both liberals and conservatives can support: more competition by eliminating health insurer's anti-trust exemption.

I wasn't aware of the 1945 McCarran-Ferguson Act. Dang. No wonder we have such a mess on our hands.

This article is from a pretty liberal site, but I looked through it and didn't find anything incendiary. I wouldn't want to be responsible for one of our members having a coronary.

Conyers, Leahy Introduce Bill To End Health Insurers' Anti-Trust Exemption | Crooks and Liars

[Sevo]

We do agree about a lot this but we must understand that what we are talking about and what our rulers are talking about are two entirely different subjects. That's where the confusion comes in. We are concerned about health care for us and the other people in this country.

The professional ruling class that is the life time Senators ,Representatives, Lobbyist and their political apparatus have only one goal and that is to stay in power. The entire push is to buy enough votes with " Free/Subsidized health care to win every election for the next 40 years.

Unfortunately for us they are going to do it. Because we will go back to the polls and re-elect the same people over and over again. The only people out side of professional politicians who really have any say so in this are now the people who hold our Debt. If they pull our limitless credit card.

hang on and hope!

[quietman]

Oh, I was so interested in health care reform. I know people are sometimes unable to get needed operations or treatments because insurance companies can simply deny claims, not matter how medically necessary doctors say it is. I know insurance companies sometimes retroactively cancel policies, in some cases based on otherwise trivial discrepancies in applications, especially when faced with a large claim. I know pre-existing conditions are often uncovered or sometimes make getting any coverage for any medical issue (even unrelated ones) impossible. I know insurance companies make complex rules that require referrals and pre-authorizations and change the rules frequently, so legitimate claims are often denied because arbitrary procedures were not followed or mistakes were made. I think that insurance companies are colluding (perhaps not explicitly) with providers to manipulate prices so that "discounts" are available to insured consumers, but not to the uninsured. Meanwhile deductibles and copays on durable medical equipment (like wheelchairs) coupled with the inflated prices let insurance companies make a profit, while consumers still pay inflated costs, even if insured. And a host of other problems, including quality of care, weird incentives that distort care given, overburden of paperwork, doctors leaving their practices and on and on...

It looks like very little of this is being addressed in the "reform" being proposed. The main focus seems to have shifted to making sure people without insurance are brought into the system, at huge cost and to great benefit of the insurance companies. The focus doesn't even seem to be on whether people get medical care. The focus is on whether people have insurance. When did this happen?

[lets-retire]

quietman--I think it happened when the media, politicians, whoever erroneously convinced people that health care was too expensive to pay out of pocket. By convincing most that health care was too expensive they effectively duped people into believing they must have health insurance and the two became synonymous.

[youbet]

Quote:

Originally Posted by lets-retire quietman--I think it happened when the media, politicians, whoever erroneously convinced people that health care was too expensive to pay out of pocket. By convincing most that health care was too expensive they effectively duped people into believing they must have health insurance and the two became synonymous.

I agree. And I also notice the tendency for people of substantial financial means to claim that a loved one is dieing because an insurance company won't pay for an experimental or controversial procedure, yet they could easily afford to simply pay for it themselves. They've been brainwashed into thinking that if insurance won't pay, they can't have the challenged treatment....... even if paying for it themselves wouldn't break their budget.

[growing_older]

The anecdotes are interesting and sometimes helpful in trying to understand specific details, but they can also confuse or be edited to promote a certain point of view.

With respect to people of means fighting with insurance companies, the situations can be complex. Having paid substantial premiums against the promise to pay for medical care in the future, people can quite legitimately feel like they've been stiffed when insurance companies unexpectedly produce lists of approved and unallowed treatments at the point where someone has a time critical need for medical attention. As for allowing a family member to die, that's an extreme anecdote. I'm not sure what you were trying to convey with that example.

[youbet]

Quote:

Originally Posted by growing_older I'm not sure what you were trying to convey with that example.

I was agreeing with Lets-retire that it seems like folks today link insurance and treatment as the same thing when they're not. From time to time, I've seen news coverage featuring an interview with a person, usually fraught with grief, that their child, spouse, whoever, is going to die because the insurance co won't pay for a experimental/controversial procedure. It makes me wonder why they don't pay for it themselves and fight the insurance co later. Or perhaps they're just saying it for the publicity power.......

If people don't like insurance companies refusing to pay for some procedures today, wait until we get a Canadian-like plan when it's the govt deciding which procedures are allowed.

Having some treatments and procedures not covered (or in the govt med system cases, not allowed) is not unique to the USA.

[quietman]

Sounds like a better plan to me. Sign me up.

[quietman]

I think the idea of what Yrs to Go was suggesting was that there is no "first dollar" insurance coverage. If that's so, then vision makes no sense for insurance. If you want glasses, then you buy glasses. You don't need "insurance" to buy your glasses for you.

[quietman]

Quote:

Right now the insurance companies have decided, for the most part, experimental procedures aren't covered. That makes sense because if they aren't sure the procedure will work they shouldn't have to pay for it.

This is so wrong I don't know where to start.

Insurance companies use the excuse of not paying for experimental procedures, but what they really are trying to do is deny as many claims as they can legally get away with.

If you really believe that ALL medical discoveries and procedures are already known and in the insurance company approved list, then perhaps you are willing to sign up for such a plan. If instead there are new treatments available, especially if your doctor is recommending a new approach, then wouldn't you want the treatment your doctor recommends.

This gets even worse if there is UNIVERSAL health coverage. If all care is paid for by insurance companies, and those insurance companies ONLY pay for old procedures, what innovations are going to be made in developing new cures and treatments.

[lets-retire]

Before a procedure can be no longer considered experimental it has to undergo strict scientific scrutiny. Now this does present problems with procedures that have worked well enough and could be considered on the edge of acceptance, unless there is a medical board that gives it's blessing saying a procedure has proven itself as at least as effective as existing procedures. I can cut and paste out of many different health insurance policy manuals that specifically state experimental procedures are not going to be paid for by the insurance company.

Like I originally stated, I don't believe insurance should pay for treatment that has not proven itself to be at least as effective as what is currently out there. It is a gamble and might not be effective. If it is not effective the insurance company must pay for not only the experimental procedure they must also pay for the accepted treatment. If it is effective then great, but since the treatment has not been subject to strict scrutiny then all of the risk in on the insurance company.

Many people don't want glasses, but in order for them to function in society they must have them. If these people can't afford their glasses then we say sorry you're not allowed to participate in society? Some even are required to wear glasses at work because their visual acuity must meet certain standards. Do we tell these people that they are no longer employed, because they can't afford to buy their glasses? We seemed to be concerned about the poor having to pay $50 or $100 for a doctors appointment, but tell these same people that the have to pay $100-$200 for glasses on their own. I can work with a cold, I can't work without my glasses and you wouldn't want me to.

[Martha]

Quote:

Originally Posted by quietman This is so wrong I don't know where to start. Insurance companies use the excuse of not paying for experimental procedures, but what they really are trying to do is deny as many claims as they can legally get away with. If you really believe that ALL medical discoveries and procedures are already known and in the insurance company approved list, then perhaps you are willing to sign up for such a plan. If instead there are new treatments available, especially if your doctor is recommending a new approach, then wouldn't you want the treatment your doctor recommends. This gets even worse if there is UNIVERSAL health coverage. If all care is paid for by insurance companies, and those insurance companies ONLY pay for old procedures, what innovations are going to be made in developing new cures and treatments.

Experimental treatments are done by participating in a clinical trial. The funders of the trial pay for it.

[growing_older]

I can (and do) buy glasses for about $20. Are you suggesting that I should pay that $20 to the insurance company, plus some kind of overhead for administration and paperwork, so that they can give the $20 to the manufacturer of my glasses? "First Dollar" coverage is inherently wasteful. I'd rather lower the premium $20 and then I can decide to buy glasses or soemthing else with that money.

BTW there are already outlets that provide FREE glasses to people who cannot afford them. Why does something as trivial as this have to be an insurance function?

[Gotadimple]

First dollar coverage implies a maintenance policy. Certainly, insurance actuaries are happy to construct a rate and benefit design for health maintenance, but can you afford it?

If first dollar coverage is so valuable, why does the IRS allow deductability of non-reimbursed medical claims and premiums (if you qualify for itemized deductions).

With first dollar coverage, cost of care will go up. Why? Because you have no vested interest in how much it costs. You've paid your premium, everything should be covered. The providers know you have first dollar, so the costs they bill to the insurer have no relative value in the marketplace.

And it can be, but understand that you will be the only one with a policy like that.

The premise of insurance is to try and keep in you the same financial position you had before you had the claim. In addition, it is by pooling dollars from a community of people who have the same policy language that economies of scale allow the insurer to keep rates lower, than if you had the only policy in the world. Insurance is not about maintenance, it is about reducing the cost of loss.

As Quietman has said, this is just so wrong on so many levels.

-- Rita