Archive for March, 2018

How “old” is too old for a fellow citizen to receive expensive medical care? Does it matter, if someone else is paying the bill?

March 29, 2018

This question about the age at which a fellow citizen should or should not receive medical treatment, especially the expensive treatments available these days, has been debated since the mid 1980s. The initial catalyst for increase healthcare costs years ago was the Medicare Act in 1967 but costs of care and premium did not really begin to accelerate faster than any other facet in our economy until the 1980s. 

For the past 35 years Insurers as well as the CMS/Medicare/Medicaid have analyzed the cost factors of delivering the healthcare people require or want. But with the advances in technology, medicine, new treatments for many diseases and expected life span into the 80s, controlling or even slowing costs has been a losing battle.

In 1990 the healthcare industry and all Payors acknowledged that the greatest volume of healthcare cost is consumed during the first year of one’s life and the last year of one’s life. When we consider the health issues of many expecting mothers, premature births, drug births as well as the heroic healthcare actions usually taken in the last year of one’s life, it’s easy to agree with that statement.

We need to remember what we’ve Posted before and what hinders cost control:

  • People are living longer and doing so with better standards of living.
  • Unlike any other population on the planet, Americans want (expect) to live forever and think their healthcare should help them achieve that goal.
  • The total cost of healthcare is the unit cost of care multiplied by the number of units of care consumed.
  • Americans want the best healthcare money can buy.
    (as long as it’s someone else’s money is paying the bill).

The last one is snarky to be sure but it’s also key to the issue at hand in this Post. Don’t think for a minute that this statement about “the best healthcare money can buy” is not true. We have all heard someone say that or maybe said it ourselves.

But much has changed since 1990 to our population, to Medicare, to Medicaid, to technology, to premium cost and to the changing opinion that quality of life may be more important than quantity of life.

My opinion on this issue of “how old is too old” has changed over the past twenty years. Partly, if I’m honest, because I’m getting near an age where younger folks might ask “why does he need a particular treatment”. Ouch, that hurts.

But the bigger influence to my opinion are the advances in medicine, in technology, and the life styles Seniors are enjoying these days.

I could list for you dozens of examples of good and poor decisions:

  • My Mother-in-law had knee replacement at age 86. She had always been active and loved to walk to visit friends. She lived to age 96 and was able to enjoy her mobility until the very last year of life. Good or poor decision?
  • A 100 year old lady had knee replacement at age 98. She lives in a nursing home and uses a wheel chair but she can walk if she desires. Good or poor decision?
  • A 90-year-old mother was in a coma after having a major stroke. The doctors said she had brain damage so she needed to be put on a breathing machine or she would probably die. The family said no because they remembered Mom saying that she did not want to live like that. Their mother died peacefully a few hours later.
    Good or poor decision?
  • I’ll tell you about my Mom below.

Many treatments or services are getting common for elderly above 80 years of age. Knee and Hip replacements are common, heart regulators or surgery are common, and cancer treatments are common just to name a few.

Those who face this dilemma about elder care must weigh their decisions hindered by so many unknowns and so many factors. Not the least of these factors is the financial motivation of the doctor or facility. Healthcare providers and facilities get paid by the procedure or days spent regardless of the outcome. So, as hard as it sounds, decision makers must weigh these factors along with the quality/quantity of life for a love one.

According to the U.S. census bureau, Americans aged 85 and older make up the fastest-growing segment of the US population. The number of Americans 100 or older is expected to rise from around 65,000 today to over 208,000 by 2030. 
So, these decisions are going to be more frequent and more difficult to make than ever before.

Many believe that we each should be able to decide when enough is enough. I mean, if one’s quality of life is not good, if one’s siblings and friend are all gone then why should someone endure a painful and depressing last few months on earth?

I wonder how many of our Seniors feel that way today although they do not verbalize it to their families. Even if they are a joy to be with the Senior may feel like they are a burden to their family. I truly wonder what each of us would choose if we could say a good bye to our family then quietly take a pill that painlessly let us drift off to forever. Would you do that?

It’s a tough question both emotionally and spiritually.

But is it a tougher question than deciding if your love one should or shouldn’t receive a particular treatment, regardless of cost, that might or might not provide a quality extension of life. 

My Mother smoked cigarettes for over 50 years then contracted a serious “brand” of lung cancer at age 66. The cancer Docs said a vigorous treatment of chemo and radiation treatment could extend her life by 18 months but without the treatment she would only last about 9 months. She/we elected the treatment which brutalized her body and mind making her feel miserable 20+ hours each day. She died 9 months later, almost to the day of that conversation with the cancer Doc.
Had she known that she would only last 9 months regardless of treatment, she might have altered her decision. She may have chosen to live “normally” without the side effects of the treatment until she past. I’m sorry, that’s a tough story.

The point is these decisions are extremely difficult. The treatments cost insurers and Medicare $billions each year. But each patient and each family may approach it differently with a different set of circumstances. No judgement here, just information for thought.

But, as we discussed before, we can impact healthcare cost and premiums for those years between birth and death if we stop politicizing the subject every damn time.
What do you think? You know that we’re all in this together, right?

Until next week.

Mark Reynolds, RHU



Sometimes, don’t we need to take a step back to look at where we could have gone. That’s really true these days for Healthcare Reform!

March 22, 2018

Starting back in 1992 and repeated over the past 10 years we’ve written about the core issues to address in order to control and lower healthcare costs both from premium and from providers. But, as the calendar turns weeks into months and months into years it’s easy to lose sight of the fundamental issues and bedrock ideas, which when implemented, can make a difference.

These days the political discussion in Washington DC stays clear of “repeal & replace” for a number of reasons, mostly partisan reasons, actually. But if you listen carefully and follow closely to can see various congress folks trying to implement their own ideas to address some specific issue important to their own constituents, or their re-election.

Lately, we hear tell of “shoring up the markets” to control premium increases. We hear discussion about financial support in states that heavily adopted public exchanges. We hear about states longing for Medicaid expansion because the ACA is eating their state’s budget alive.

These discussions are really no more than scratching where it itches for those specific congress-folks. The actions those congress-men/women promote don’t really address the inherit problems caused by or neglected by the ACA . So, they won’t be more than a band aide on an elephant’s bruise. You thought I would say something else, didn’t you?

But you know that I am an optimist trapped in a cynic’s body so my hopes of replacing the ACA with a workable solution are still real although I admit guarded.
If you were asked for meaningful input in designing a workable solution. Could you do it? I bet you could and you’d come closer to a workable solution than the ACA did or the GOP has offered to date.

We first published the 12 ideas below in 2006. I think it’s worth dusting off these ideas to see which would still make a difference. What do you think?

  1. Make health insurance premium 100% tax deductible for anyone who pays it.
  2. Make all fully-insured plans for individuals and families guaranteed issue but with a reasonable Pre-existing condition period for no prior coverage.
    Pre-ex period: 12 months would encourage participation.
  3. Group plans of 2+ employees remain GI with No Loss-No Gain Take over.
  4. Allow carriers a reasonable corridor for Risk Adjustment Factors (30%). Also let insurers determine area rating factors based on their data and statistics.
  5. Tort reform: Loser Pays and/or Fixed Attorneys at 20%.
  6. Allow carriers and plans to sell across state lines. (Maybe the AHPs??)
  7. No new benefit mandates from States or Feds for five years plus allow insurers freedom to build plans that the market demands. That the people demand!
  8. Mandate HRAs permissible and available to implement on all plans.
  9. All insurers must publish and release statistics and experience data.
  10. Universal enrollment forms for all group plans and all individual/family plans.
  11. Health plan commission set at level 7% and does not increase as premium does.
  12. Providers must post their rates per service. Hospitals must post their outcomes.

We are all used to the ACA mandates of kids to 26 and wellness or preventive, so let’s leave those in place.
But, let’s eliminate Unlimited Lifetime levels and return to $5M per insured
Also let’s eliminate the Medical Loss Ratio (MLR) limits since no other industry in the world has its profit margin restricted like insurers do. 

Then let’s go crazy and build in incentives for employers to support wellness plans. If we want to bend the cost curve downward we must address member behavior and expectations through real wellness and benefit structure.

With the brief outline above we can provide solutions for:

  • Those that want to buy insurance but are un-insurable
  • Those that don’t want to buy & wait until they have a problem to buy insurance.
  • Guaranteed acceptance
  • How to push premiums lower
  • How to push unit cost of healthcare lower
  • Total transparency of statistics and outcome data.
  •  Improving benefits with lower out of pocket limits.

So, there is a quick review. I encourage you to give this some thought and to give us your input. If we put something together worthwhile then who knows; we might make a difference. There’s an election this Fall, remember.

Let me know what you think because we’re all in this together.

Until next week,

Mark Reynolds, RHU
It stands for “Walk the Faith”.

People “think” the ACA Individual Mandate and its “penalty” is gone thanks to the Tax Cut & Jobs Act of 2017. But is it and why are so many confused about it?

March 15, 2018

As happens so often, people hear about an action taken by some level of their local, state or Federal Government authority and misunderstand its effect it has on them as well as the timeline for that effect in their life. The ACA Individual Mandate (IM) is addressed in the Tax Cut & Jobs Act of 2017 (TCJA). But two things seem to be confused.

One, its being reported that the IM is “repealed” by the TCJA but what is really more accurate is that the penalty for not having medical insurance coverage is simply being set to zero. As we’ve discussed in previous Posts, every effort to R&R the ACA by the GOP has included setting the penalty for non-compliance to zero. As discussed before, at any time in the future a new Congress, probably Dem but possibly GOP, can reset the penalty for not having coverage to what ever it decides and even higher that the levels within the original IM of the ACA. That should not be defined as “repealed”!

The second issue is that many people think they do not have to worry about a tax penalty for not having medical insurance coverage in 2018? That’s understanding is wrong. The IM and its penalties remain in place for the tax year 2018. In a statement that some called a “finger in the air to Americans” retiring IRS Commissioner Koskinen stated that the IRS will vigorously enforce the ACA IM penalty for tax year 2018. So folks, don’t let your coverage lapse.

We have started to see the next phase of the IM “repeal” as prognosticators predict and promise that the elimination of the IM will lead to a spike in premiums and huge drop in the number of Americans will health insurance. Seriously, do you think folks could tell the difference in their premiums after what they have felt so far over the past 8 years? Well, let’s wait to see shall we?.

My bet is that eliminating the IM will have minimal affect on citizens who do not get their health insurance through their employer. I’m certain that many individual States will take actions on their own to mandate coverage, especially Liberal states with a highly subsidized Exchange. But, even that action will not produce any noticeable change in coverage.

Those states suing about the TCJA or President Trump or taking other steps within their state will be busy for the next 2 years. They will see and probably resist the growth in Association Health Plans, the introduction of selling medical insurance cross state lines, as well as Short Term Medical plans.

So, if you are in the consulting business, are a CPA, or other tax preparer it would be helpful to clarify this issue with your clients and prospects. They may think you are really smart. They may just think ho-hum. But, you will be clarifying for them something that may save them some money.

That’s it for this week. Short Post, I know, but that’s because the subject matter called for no more and also because we’re focused on a few other topics in the weeks to come.

Let me know what you think.
Thanks for your feedback. It confirms for me that we are all in this together.

Until next week.

Mark Reynolds, RHU
It stands for “walk the faith”.

Trump Administration releasing new standards for Short-term Medical Plans. Is this good, bad, no big deal? Let’s discuss.

March 8, 2018

President Trump’s administration has released “new rules” which will allow Short Term Medical Plans (STM) to be offered for up to 12 months. This is good news for tens of thousands of Americans but it will cause ACA advocates to go crazy. Which is kind of fun to watch, actually.

In the past I’ve not talked about STMs as they were restricted by the ACA and certain states which prevented STMs from being a long-term or even intermediate term solution for reforming our healthcare issues. STMs had been designed:

  •  As temporary coverage, lasting for a few months. while
  • For workers  between jobs.
  • To provide limited protection.
  • Portions of hospital or doctor bills.
  • Not to be long-term coverage us it made sense to member.

But, premiums have increased 300% over the past 7 years and out of pocket limits on ACA compliant plans have increased to a point where they can cause financial ruin. No one, who avidly or rabidly supports the ACA, wants to admit or acknowledge that the increase premiums are paid primarily by un-subsidized population of American. Stated more clearly, people who don’t received subsidies pay the brunt of these increased costs.

 “We want to open up affordable alternatives to unaffordable Affordable Care Act policies,” said Health and Human Services Secretary Alex Azar. “This is one step in the direction of providing Americans health insurance options that are more affordable and more suitable to individual and family circumstances.”

STMs could add more options at potentially a fraction of the premium of ACA plans. STMs would help healthy folks, strapped financially by ACA plans, in both big city and urban areas but certainly in the rural areas of the country.

Opponents will argue at least three issues for the downside of STMs. The first is that STMs will dilute ACA compliant plans as the premium paying healthy folks seek out and obtain coverage from a lower priced STM. If you were healthy and could slash your health plan premium by 50-75%, would you try it? Heck, Yeah!

Currently, under the ACA, STMs are offered generally for only 90 days at a time then must be renewed. Generally speaking their benefit designs are “crap” as one would honestly describe. One can’t blame an insurer for a low cost “crappy” plan when it knows its customer could use the plan then be gone in less than 90 days. Insurers could never sustain a reasonably designed plan with Rx copays and high limits on coverage because a single episode of care would wipe out reserves.

But, we have not yet seen what the market will demand of STMs when they can be offered for up to 12 months. An insurer then could assume that members would retain coverage for a longer period and thus may be able offer plans a bit richer in benefits while still a fraction of ACA plan prices. We’ll see about this.

There are reports from folks at CMS (Center for Medicare and Medicaid Services) estimate that these STMs might attract up to 200,000 members nationally. That estimate could be dead-on accurate or wildly off. But, since the majority of working Americans receive their benefits through their employer it may in the ballpark.

I said above that opponents would argue three issues. The second is that acquiring coverage requires folks to answer health related questions on the application, and insurers can reject applicants with preexisting medical problems.  ACA plans cannot underwrite applicants and cannot refuse coverage even if an applicant is in an ambulance heading for the hospital. 

The third issue opponents will absolutely hate is the benefit design of these STMs. STMs will certainly not include the Essential Health Benefits or pediatric dental, or maybe even wellness/preventive benefits. STMs will be designed and be appealing to healthy folks

Opponents will argue that citizens will be uninformed about the plan benefits and be buying plans that do not provide the coverage that our citizens require. Opponents will not give these healthy premium paying Americans and credit for wisdom or discernment.

Those are three very important objections and they must be addressed because there will be some states, such as Ca, that will not like STMs and will fight there presence in the state’s market.

But, the primary objectors will be:

  • Rabid ACA supporters who actually want the ACA to morph into single-payer plans, but are intellectually dishonest about their motive.
  •  Insurers who have been collecting huge premiums and reporting record profits will fear losing healthy members who are paying their ACA inflated premiums.

Will STMs be “skinny plans” which applicants need to clearly understand, yes. But, American shoppers are pretty savvy plus they can access insurance professionals to help.

What do critics say, “the proposed regulations for offering ACA non-compliant plans along with the alleged elimination of the individual mandate by Congress could render the Affordable Care Act even less viable”.

 Others will state that these plans won’t include critical benefits such as mental health coverage which in in the news so much lately due to the apparently mentally impaired man in the Florida school shooting.

These objections shouting “buyer beware”, “there are no benefit” these plans will cause death” will be replayed by the liberal media so much you will wish you could listen to a “ZYPPAH” commercial.

One by-product could be that if the ACA compliant plans are impaired, due partially to eroding healthy membership, it might accelerate the death of the ACA or creation of more alternatives. That would take time but if Congress won’t do the job then maybe time and circumstances will.

Robert Lasewski an industry consultant says, “If consumers think Obamacare premiums are high today, wait until people flood into these short-term and association health plans.” He adds, “The Trump administration will bring rates down substantially for healthy people, but woe unto those who get a condition and have to go back into Obamacare.”

Remember what we’ve said in previous Post, the ACA punishes the many to provide benefits for the few. The opponents of these plans fail to understand or at least empathize with the millions of Americans paying huge premiums each month for benefits they don’t or can’t use but get not subsidy. Let’s help those folks once in awhile.

Christopher Condeluci, a benefits attorney who also served as tax counsel to the U.S. Senate Finance Committee states, “While these plans might not be the best answer, people do need a choice, and this new proposal provides needed choice to a certain subsection of the population.”

Comments like that make me realize that I’m not alone in thinking the American people deserve options. They deserve our support and they deserve a break, for once.

To summarize, STMs will:

  • Offer alternative for healthy Americans.
  • Be a fraction or premiums charged by ACA plans.
  • Provide fewer benefits than ACA compliant plans.
  • Include underwriting that could reject applicants request for coverage.
  • Be very profitable for insurers.

But STMs may:

  • Take healthy members away from ACA plans.
  • Leave ACA plans with more unhealthy than healthy members.
  • Cause ACA plan premiums to increase further.
  • Still be profitable for insurers.

The piece by piece dismantling of the ACA is not a perfect scenario. But if you remember, the ACA piece by piece dismantled all of the great aspects of American healthcare plans starting in 2010. If the piece by piece process is the only way that America can be offered better options then it is a worthy endeavor. The ACA can be slowly eliminated which would give us the time to adjust and improve.

What do you think? We’re in this together so let us know.

Until next week.

Mark Reynolds, RHU
It stands for “Walk the Faith”.










Remember the ACA’s Independent Payment Advisory Board or “IPAB”. The so-called “Death Panel” is dead! Why is no one talking about this?

March 1, 2018

It’s often difficult to remember things that occurred yesterday, let alone 7 years ago, but do you remember when the ACA was signed in 2010 and its provisions started taking “root”? I know, I know, you think I’m wrong  because everyone thinks the ACA took effect in 2014. But, it actually began its insidious spread across American healthcare in 2010 by imposing taxes, fees, reporting requirements, pricing regulations, speculation and the formation of new agencies and processes including the Independent Payment Advisory Board (IPAB). 

Well, IPAB is dead and credit goes to the Tax Cuts and Jobs Act of 2017 that Congress passed and President Trump signed in December 2017. It’s demise received no fanfare, in fact, I’ve only seen one article about it and no TV commentator has mentioned it to my knowledge. Why is that?

Everyone remembers Governor, turned VP candidate, Sarah Palin calling out the IPAB as a “Death Panel”. Heck, even today when commentators speak of Governor Palin they bring up her comments about IPAB. Calling IPAB the “Death Panel” was not a totally inappropriate synonym for the IPAB given the political nature in Washington. But, that does not mean that the concept of IPAB was necessarily evil.

The concept of IPAB is/was not necessarily a bad one, that is until it gets combined with politics and the politicians in Washington.  Its intended goal was to control, lower, and eliminate cost for Medicare and specifically Medicaid. So, if something could lower costs then it would be good. But if its goal was to eliminate services for Seniors…”What would people like you and me call it? “Death Panel”! 

However, IPAB did not have regulatory or enforcement authority. It could only make suggestions to HHS, other governmental agencies and the commercial markets. IPAB could only recommend lower reimbursement levels for specific services, suggest lower frequency of treatments, or treatment protocol of a specific service can be used for treating “this” condition but not “that” condition. IPAB could only make recommendations.

Did you ever wonder why no politicians, from either party, ever talked about IPAB over the past several years. Democrats, especially, did not want their names connected with IPAB. Why was/is that?

The reason is that IPAB was created to be a scapegoat. It was designed to provide political cover for jelly-spined politicians from either party if allowable treatment protocol for medical services were altered, reimbursements to providers lower, or benefits cut back on Medicaid and Medicare recipients.

Stated more directly, if IPAB did its job, the result of which cut benefits or services to Seniors, then politicians could blame the IPAB people or ACA or Government in general and escape blame for themselves. You must admit that’s clever.

Some will remember that in 2013 the IPAB published new recommendations for “lady check-ups” for women over 40 years of age. Specifically, it stated that the frequency for the exams women, over 40, needed could be less frequent than what was in practice and recommended at the time by every healthcare organization in the free world. 

Of course, that news met with loud protests so Secretary Kathleen Sibelius, of Health and Human Services, quickly released statements clarifying that IPAB was an “independent board” and did not speak for the Government and the IPAB suggestions would not be implemented by Medicare or Medicaid. Whew, dodged a political crisis, right?

Again, stated more clearly, IPAB could only suggest ways to reduce costs. But if the IPAB suggestion was not politically expedient or cast dispersion on the ACA then it might reveal potentially harmful  political result, caused by the ACA. Plus, President Obama’s reign in office had not ended so the Dems could not have an independent board established by the ACA actually start reducing benefits to older Americans and especially not to woman.   

The GOP does not get off scott-free here either. The GOP always states that Medicare and Medicaid costs must be lowered so the GOP was/is perfectly willing to allow an independent board make decisions that would be political suicide for any party in the majority. The GOP was also perfectly willing leave the IPAB in place with no acknowledgement what so ever. Hold it in reserve, so to speak.

But, if the GOP is serious about controlling healthcare costs then why eliminate the IPAB in the 2017 Tax Cuts and Jobs Act? Spending trends in healthcare must be controlled, some how, right? Granted healthier life styles and lower utilization is preferable but that ain’t happening. 

Remember the Military Base closures in the 1990s? There were dozens and dozens of Military bases around the country that could have been moved or closed all together as a byproduct of the Cold-war ending. But, to close a base in a politicians district did not help in the politician’s re-election process. So, Congress formed an independent board to identify and suggest to Congress bases and facilities that could be closed. Hundreds of facilities were closed or relocated to reduce cost but the politicians did not have to take direct responsibility for the closure decision. Another scapegoat to the rescue.

The IPAB and its objective is worthy and one might say absolutely necessary given America’s out of control healthcare system. But, when someone is 65+ years old the trend for their healthcare cost-line may already be determined by their life’s previous choices or DNA. So, to reduce or eliminate the service these American most certainly need seems heartless and wrong. However, we need to reduce cost so there in lies our dilemma.

If we’ve seen anything consistently out of Washington it is that it can not solve these kinds of dilemmas. They can’t have reasonable discussions or debate. They can’t introduce creative ideas because politicians refuse to take risks that could end a political career. UGH!

IPAB was a good scapegoat, a good talking point during elections and maybe a good way to make suggestions about healthcare delivery and its costs. But, it’s gone.

We have loads of examples of the hypocrisy of politicians as they dodge responsibility and accountability. Eliminating the IPAB with no fanfare or the slightest public discussion is one we all recognize. Let’s hope the ideas our Posts discussed previously can make a difference some how.

Let me know what you think.
And remember, we are all in this together.

Until next week.

Mark Reynolds, RHU
It means “Walk the Faith”