Archive for the ‘affordable care act’ Category

Last July, our Post heading was “What would the consequences be if the GOP passes NO legislation to Repeal & Replace? Let’s look at the impact on insurance coverage.” Were we RIGHT?

April 19, 2018

Below is a re-Post of July 27th 2017 with a few comments highlighted in Red. With midterms only 6+ months away, will the decisions made by the GOP last year come back to bite? Read on to see if we were close.

 As I write this post, the Senate has voted to open hearings and take amendments for the Senate’s R&R bill. Basically this is the Senate’s last effort do accomplish anything  for now on Repeal & Replace. Without being pessimistic, I would wager that the smart money will be bet on nothing coming of this.

Regardless of one’s political leaning everyone must agree that action is needed to either replace the ACA (with something better) or make repairs to the ACA (that will keep it alive). I realize that is a big summation but if we are honest then we must conclude that the ACA is failing so one way or another action is needed. Either for the benefit of the millions of Medicare Expansion subsidized enrollees or for the tens-of-millions of premium paying citizens and employers, the ACA needs either fixed or replaced.

So, what would the consequences be if our House & Senate don’t do anything. That is, if they don’t provide or modify the subsidies for the insurers and all of the other ACA issues that need changed to survive or don’t replace the whole darn thing, then we will see a number of absolutely predictable results.

Of course, the Politician’s thoughts will immediately turn to their own future and the 2018 elections (probably have been already) but I want to focus on the impact to all of us, the hard-working premium paying, mortgage paying, car payment making, tax paying citizens. It won’t be good but let’s look at it:

  1. Regardless of whether or not the subsidies of the ACA are paid to insurers we will see: (Correctly so, they’re not paid, yet.)
    a. Premiums for individual plans increase double-digit (20% or more) and be projected to continue for the next few years. It’s happening!
    b. The Counties without an insurer for the individual ACA plans will continue to increase. It’s projected that as many as 1/3 of all counties will have no individual ACA plan available. In the more rural states we could see the number of counties with no individual plans exceed 80% of the counties within those states.
    YEP, that’s what’s happening!
    c. The number of insurers willing to even offer plans anywhere in the country will decline, including those insurers offering plans outside the ACA Exchanges for both group and individual plans. Sadly, for rural areas this is true.
  2. Medicaid enrollment will continue to rise. Even though Medicaid plans provide lower benefits and there are fewer providers, most people don’t realize those facts until it’s too late. Besides, the idea of “free insurance” will become more and more appealing as premiums continue to rise for the tens-of-millions of premium paying citizens that use very little or no healthcare each year. “Why should I pay premium when I never use my plan and those folks are getting it for free?”. Right?
    This is happening plus a few states are trying to expand further.
  3. To summarize: fewer insurers offering fewer choices with few participating providers all at premiums increased each year. That is correct, Madam.
  4. Of course, the result of # 1, 2, and 3 above will lead to another crisis because there won’t be enough money to pay for all of the Medicaid claims and insurer’s subsidies. Which will lead to:
    a. Increased taxes or create new taxes on benefits to generate more funds.
    b. Decrease the benefits at either the plan benefit level or utilization level. That means the IPAB “Independent Patient Advisory Board” or Death Panel will decide what gets authorized and covered and what does not.
    Your 90-year-old mom may need a new hip but will the IPAB authorize it?”
    Luckily, as you read in previous Posts the IPAB is dead, not your 90-year-old mom.

We could go on and on because it is clear that the entire healthcare finance and delivery system will feel the impact of our Congress doing nothing. There is some hope though due to the President’s EOs for AHPs.

One additional concern is the “overly optimistic political corrected” desire to pass a “skinny bill” that would simply repeal the Play or Pay mandates. That could be catastrophic to insurers and to premiums that would need to be increased.

I don’t understand politics and have the scars to prove it but I do try to understand human nature. Human nature will drive most politicians to look out for themselves in their own individual voting district throughout the healthcare debate. This is already occurring in many districts.
Sad thing is that the GOP seems to be immobilized from taking action on R&R  due to the criticisms from people who wouldn’t vote for them regardless of any action taken.

Makes you want to ask, “So, a small percentage of people in your district, who wouldn’t vote for you under any circumstances, are preventing you from doing what’s right for tens of millions of American?” See this example before, haven’t we?
As I said, I don’t understand politics.

Sorry for the negative outlook concerning our Congress and especially its leadership. But, since neither the House nor Senate bills actually repeal the ACA there seems to be little to ignite optimism. And of course, times and circumstances change the immediate need of the population so all help is on hold.

I think we can point to the children’s book “The Emperor’s New Suit” as the beginning of the GOP’s downfall.  You can’t tell people it’s an ACA repeal bill, while leaving the core foundation of the ACA including taxes, and expect the people to embrace it. Reducing the Play or Pay penalties to zero and calling it repeal  does not repeal the Play or Pay core fear of the ACA. It only increases premiums.
I didn’t like that book when I was a kid, and I still don’t!

Well, we’ll see what happens this week and together we will address it.
Because, we’re all in this together, right?
It’s because we suffer with these political blunders together that makes it more frustrating. Together, we are fed up and should do something.
I know – vote.

Until next time.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf
It means “Walk the Faith”.

 

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
559-250-2000
mark@reynolds.wtf
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
559-250-2000
mark@reynolds.wtf
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
559-250-2000
mark@reynolds.wtf
It means “Walk the Faith”

Big-news announcement from Jeff Bezos, Jamie Dimon & Warren Buffet concerning their firms aligning to solve the healthcare crisis. Can they make a difference.

February 22, 2018

Recently the heads of Amazon-Citibank-Berkshire Hathaway announced that their three firms are planning a joint venture attempt to provide appealing lower cost health care benefits for their employees. This announcement could actually affect dozens of firms, if they include all the companies they own, and provide coverage for nearly one million people. 

With that many members in a covered population the results would be actuarially credible and provide statistics upon which the partnership could rely. These are three pretty smart business people, who can afford to hire the expertise required, and I believe their objective would be to lower cost but not  do so at the expense of their member’s benefits or access to care. It dose make one ask:

  • Will they be able to build a health care program or system that improves delivery at lower cost? 
  • Will they be able to make a difference for the million lives covered?

The answer can easily be YES, but the process, in the beginning as well as for years to come, will need to remain “OCD like” focused on a few basics.

In previous Posts we’ve discussed how to lower cost (both premium and OOP) while improving benefits and access to those benefits. A single set of members covered under the same focused effort can achieve better outcomes than we’ve witnessed from the ACA over the past 7 years. It’s especially possible when there are a million member lives involved, managed by the brilliance of these three firms/CEOs.

Plan offerings, PPOs, HMOs, managed care, pre-service review, post service review and value based payments will all be included but will that be enough? We should expect major innovation and reliance on technology.
But, unless there is innovation involved in a number of “human'” areas the probable outcome is predictable. As the plans are offered and members make their selections utilization then occurs. That’s a big component.

Remember, the overall cost of healthcare is equal to unit costs times number of units consumed. Controlling unit cost is far easier than controlling the number of units consumed.
How can a plan affect utilization?
How can a plan affect the choices members make?

So let’s ask – What are the two biggest factors impacting the cost of healthcare in America? Don’t say political stupidity, selfishness, or laziness although you would not be far off. If you suggest the seemingly unrestricted increase in Rx cost or the high cost of other treatments you would be closer, but it’s simpler than that.
 
The two issues that impact our health care finance and delivery system are: smoking and obesity. I’m not trying to be insulting, critical or overly clever here. The fact is that more health care dollars are spent on members and by members as a result of these two factors than any other five factors combined.

So, how will the new health care partnership of Amazon-Citibank-Berkshire Hathaway address these issues? Don’t be a cynic about this because these issues can be addressed and outcomes improved with plans designed to encourage change.

Can these two factors be mitigated without appearing too mean-spirited?

  • If you’ve ever smoked two or more packs of cigarettes per day or know someone who has then you know this habit is a killer to overcome. (Pun intended)
  • How can obesity be addressed when 40%+ of the American population is classified “morbidly” obese.

I am looking forward to watching the efforts by these three corporate giants and the plans, policies, and promotional output they make.  There is real potential that, if successful, these efforts by “Private Enterprise” could be a turning point away from the Liberal’s focus on “single payer” plans as the only solution for health care finance and delivery.

You know this can be done, especially if you read our previous Posts, so let’s be attentive and supportive as these three behemoth conglomerates set forth their ideas into reality.

We’ll watch together because, well, you know why!

Until next week.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf

Alex Azar is sworn in as our new Secretary of Health & Human Services. Who is Mr. Azar and what can we expect.

February 1, 2018

Alex Azar is a Yale educated attorney who just may be uniquely qualified to lead the HHS at this time with the objectives laid out by President Trump.  Mr. Azar has practiced law in the real world as well as being the General Counsel for the HHS under President George W. Bush from 201-2005.

Mr. Azar was Deputy Security of HHS from 2005 until leaving in 2007 toward the end of the Bush administration. After serving at HHS for nearly 7 years, he was hired by Eli Lilly Co in 2007 to be a spokesman and lobbyist before ultimately being named Vice-President of US Managed Healthcare Services organization for Eli Lilly.

One unique fact about Mr. Azar is that he has never been a politician. Dating back nearly 40 years, every appointed & confirmed Secretary at HHS has been a career politician either Governor or Senator. Obviously, being a career politician does not really prepare one to make the decisions and take the actions that are needed to give our citizens the best services from an organization called Health & Human Services. Let’s face it; for most politicians the primary goal always seems to be serving for themselves.

There in lies a unique factor that may prove positive since Mr. Azar has not been be-holding to anyone for an election, a trait he has in common with President Trump. In addition, Mr. Azar was employed at Eli Lilly, a big pharmacy and healthcare company for roughly 10 years. That is important to note because we all know pharmacy costs continue to increase dramatically and nobody seems to be able or willing to control them.

It is also critical to acknowledge that the delivery of pharmacy benefits is a complicated function. In the Rx delivery business you have AWP (Average Wholesale Price), MAC (Maximum Allowable Cost, public plans such as Medicare or Medicaid, private plans such as your Anthem or Aetna plan, dispensing fees, and don’t forget rebates all of which make delivering your Rx very complicated.

Plus, the retail cost of an Rx in the US is much-much higher than in other countries including our neighbors in Canada and Mexico. In fact, people in Canada and Mexico can often purchase their personal prescriptions for 10% of what we pay in the US.  That’s right, what you might pay $100 for in Oregon or Maine is available for $10 in Mexico.
Now, who can understand or make sense of that?

The Rx delivery business is more complicated and potentially more abused than any other aspect of healthcare in the US. With healthcare cost increasing double-digit and premiums increasing sometimes by triple-digit it may serve the public well to have the Head of HHS understand the Rx business as well as how the HHS works.

President Trump publicly tasked Mr. Azar ( directed him actually) to reduce Rx cost dramatically. President Trump also publicly instructed Mr. Azar to continue with the objective of replacing the ACA with a better healthcare financing and delivery system.

How’s that for directions from your boss on your first day on the job?

So, Mr. Azar:

  • Is not a politician.
  • Beholding to no one – except the President.
  • Understands big Pharma and its:
    • R & D processes
    • Patent protection and effect on Generic vs. Brand
    • Profit margins
  • Delivery of Rx through private and public plans.
  • Law & business experience
  • Works for a President that:
    • Wants to lower cost
    • Improve access
    • Make a difference in people’s lives
    • Doesn’t give a darn about the way it has always been done!

In 2010 through 2014 we heard from and about the Secretary of HHS constantly because she was continually making announcements about the rules or regulations being developed for the ACA. On and on it went with restrictive-obtrusive-costly and damaging rules to make the ACA be what the Liberals wanted.

I suspect that we won’t hear that much from or about Mr. Azar except when the Liberal cry out about the piece by piece incremental changes to ACA. If Mr. Azar can reduce Rx costs, which is a huge “if” due to the power in Pharma, then we will all benefit.
But, we should not be overly optimistic about seeing Rx cost drop too quickly.

Can you imagine how hard it would be to make Northrop Grumman, McDonald Douglas or Lockheed Martin  reduce their costs 40% to 50% for the guns, airplanes and missiles our military requires to keep us safe. Believe it or not, that is a reasonable example of the battle Mr. Azar will have as he tries to lower Rx costs in America.
And, I am not exaggerating.

I am optimistic, though, about Mr. Azar’s chances of making a difference. He is experienced with the HHS, understands how Big Pharma works, plus he has a Boss (The President) who is demanding lower cost, better access, and better efficiency. These factors could make it possible to see the changes America needs and deserves.

There is much more we could discuss about Mr. Azar such as his positions on AHPs, selling across state lines, insurer subsidies and so forth. But given that he was just sworn in 20 minutes ago, I think it would be wise to simply watch to see where he starts and what he can do.

The Department of Health & Human Services affects us all, more than most realize, so we are definitely all in this together.
But what do you think?

Until next week.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf

 

Enrollment period for ACA Individual plans is over. All the effort and stress for 8 million citizens.

January 4, 2018

We talked a bit about the craziness surrounding the open enrollment period for individual plans on previous occasions. Now the open enrollment period is over and the media will quiet down.

But, the other 300+ million Americans adversely impacted by these individual plans should continue to raise hell! As we’ve discussed in previous posts the entire private sector healthcare system of finance and delivery is suffering because of ACA imposed rules, metallic plans, burdensome regulations, and liberal press bias.

We should not begrudge these 8 million Americans, in fact it’s just the opposite, I wish the number included every American not covered by an employer sponsored plan or Medicare/Medicaid. If the reports are correct there could be another 20 to 25 million Americans on individual plans but choose not to for one reason or another.

The fact remains that Democrats inflicted us all with the ACA in an effort to take over private healthcare so that the government would then control 100% of the health finance and delivery system in America. But, they failed.

Their failure is not due to efforts by the GOP which we’ve all seen to be dysfunctional, pitiful and weak. No, the ACA’s failure is due to the character and spirit of free markets and the American people.

But, once again, the efforts by Liberals cause the many to pay extra for the few. In this case, the many have seen their premiums increase 300%, their doctors disappear off PPOs, and the number as well as quality of the health plans offered reduced.

We see similar punitive results in the liberal assault on so-called climate change. Their efforts here are another example in which the people who can least afford it bear the brunt of the cost. We all want clean water, clean air and blue shies. But, the regulations demanded by liberals raise the cost for Americans struggling to get by while the governments in India, China, and other polluting countries just skip on by.

I start out 2018 with this rather negative post not because I think the future is bad or that we are doomed to the same crappy health plans forever. I begin 2018 with this message because I know we all need reminded and that while you and I are busy living our lives there are others who won’t give up the fight.

I think 2018 will bring continual reminders about the need to change or repeal the ACA. But since the Congress and Senate seem incapable of pulling it together the changes we need will likely come in piece meal bills and directives.

So, don’t begrudge the 8 million mentioned above because many of them could not qualify for or afford coverage before the ACA. The ACA would never have gotten a foothold and could have been avoided had the GOP implemented GI back in 2002-2003 when they implemented HSA and HRA plans. It could have been simple!

I think change is coming and is in the works as you read this. Let’s not forget the potential for Association Health Plans and the ability to sell across state lines were put into motion in 2017.

We have reason to be angry but we also have reason to have hope. Let’s watch for the incremental glacial movements in 2018 that will bring relief to the millions of premium paying citizens of America.And I’ll keep you updated along the way.
Happy New Year.

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

Until next week.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf.

Skinny Plans, what are they and why do they draw so much criticism? Let’s look at the truth.

December 14, 2017

We have all witnessed this term “skinny” become common for promotion of many facets of our everyday life. Skinny margaritas(I’ve heard of these but never ordered), skinny chicken, skinny shrimp or other skinny menu items, and skinny jeans (which I totally don’t understand), and many-many more common everyday items turned skinny in our everyday life. I apologize, in advance, for discussing anything “skinny” midway between Thanksgiving and Christmas but it is important to address the term as it is being used in the effort to obstruct the needed overhaul of healthcare in America.

But, calling a health plan “skinny” , while descriptive, may be misunderstood my most which opens up the opportunity for opponents to mislead the public about the potential positive impact of these plans. So, let’s look a little deeper.

As we’ve stated many times before, clever names or phrases are often used to criticize an idea then the name quickly becomes the label that misleads the public from the truth. Such is the case with the rhetoric we’re hearing and reading concerning medical plans that are not compliant with the mandated benefits of the ACA.

People started calling these “not 100% compliant” medical plans “skinny” in an effort, I believe, to mislead the public. At the very least the term is being used to draw attention or improve the critic’s own ratings.

Why do critics think that we Americans should not have more plans from which to choose for employer’s or our family’s health plan. Sure, many Americans are uninformed about quality maybe reality, as is evident by the popularity of such shows as the Bachelor or sports like soccer(too much trotting around). But when it comes to healthcare I think people know what they can or can’t afford and what they need or don’t need.

Plus, our citizens can always turn to the thousands of qualified insurance professionals available in every state in America. Insurance agents are well trained and can easily assist Americans in making the best choice for their needs and budget. But, agents need, just like the public needs, these alternatives so that the citizen can make the choice that best fits their own personal need.

So, what are these plans that so many fear will undermine the integrity and financial stability of our nation?
What will a Skinny plan likely not include? They may not include:

  • Pediatric dental and vision for adults.
  • Unlimited brand name Rx.
  • Maternity
  • Pregnancy termination (abortion)
  • Unlimited Office visits
  • Unlimited lifetime benefits
  • GI without reasonable pre-ex policies.
  • All of the 63 MEC benefits
  • Other benefits that increase premium but nobody uses.

What will skinny plans likely offer:

  • Choice of Copays.
  • Telemedicine.
  • Maternity if desired.
  • Wellness (true wellness with incentives).
  • Choice of PPO networks.
  • Higher OOP to lower premium
  • Lower OOP plans for more choice.
  • Alternative Rx plans
  • HSA option with higher HSA allowance.
  • Higher OOP for wasteful healthcare decisions.
  • Lower OOP with incentives for smart healthcare decisions.

There will be dozens, possible hundreds, of plan choices instead of the current 4 choices available! Health plans will be developed ranging from Minimum Essential Coverage to Cadillac rich plans. Employers will be allowed and encouraged to buy minimal plans that can be enriched with HRAs.

The bottom line – at the end of the day – when all’s said-n-done, the objective is that the insurance industry, led by local TPAs, will provide America more choice with better benefits at lower costs. Now what’s wrong with that?

I’m serious, what’s is possibly wrong with that? If you have objective arguments against these options please let us know. And, please don’t argue that these plans will hurt insurers by taking all of the good risks and leaving the bad risks to the insurers. It’s all GI so the risks can go where they think their needs are best served.

But, let me know your thoughts because we’re all in this together.

Until next week.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf

 

Watch for the coming News “onslaught” concerning enrollments on ACA individual plans. Watch for actual enrollment numbers and blame!

December 7, 2017

Most Americans are most likely unaware of the enrollment process going on around the Country as six to eighteen million (number varies depending on source) American go on-line to enroll in the ACA individual plans available through State Exchanges or ACA.gov.

Most are not aware because out of a population of 330 million Americans only 10 million were signed up last year which was less than 3 percent. If one does not qualify for the subsidies offered through the ACA Exchanges then most people wanting an individual plan will sign up directly with an insurer.

During the initial  21 days of enrollments the Media anxiously reported that enrollment figures were ahead of a year ago substantially. But that will not last as today’s reports state that enrollment has slacked off greatly.

The media will ultimately tell us that enrollments are down because President Trump did not authorize the CSR subsidy payments, which caused premiums to increase. That is not true, of course, but the average citizen won’t know the truth. Unless they have followed our Posts.

It will be interesting to see the actual enrollment figures especially if Congress does insert the elimination of the Individual Mandate in the proposed Tax Bill. I bet the Mandate waiver remains which means there will be people not enrolling or canceling coverage because there will no longer be a tax upon them for not enrolling. It would be fascinating if Las Vegas bookmakers were to allow wagering on enrollment figures. My wager would be for fewer than 8 million. So, what should we expect?

On a separate and unrelated topic; today is December 7th. These days most folks go about the day without acknowledging the importance of this date in American or World history. I mentioned this because last month on November 10th we celebrated the Veteran’s Day holiday with a day off, without much fanfare.

I played golf that day (Nov 10th) and commented to a friend “do you remember when we were kids in school acknowledging Veteran’s Day by standing up with a moment of silence at 11am?”. Of course he did and today is December 7th, a day proclaimed by President Roosevelt in a message to Congress in 1941, that would live in infamy after the attack on Pearl Harbor

I mention this subject because I am increasingly concerned that our current population and our legislators will be less able to learn from our nation’s experience and its history if we stop acknowledging that history and those experiences. How will we successfully deal with radical Islamic terrorism, threats from N. Korea and Iran, or the ongoing war that Russia and China wage against the US if we are not willing or unable to remember how we mishandled threats and issues in our Nation’s past.

It also applies to important issues we face as a nation such as the financing and delivery of healthcare. If we are unwilling or unable to look back at insurance “policies” and solutions that worked in the 1980s, and 90s then we will continue to get results such as those delivered by the ACA.  The ACA was suppose to deliver better access and lower costs but does neither. We can still recover but not if we neglect those principles we know to be sound.

This was just something on my mind.

Much to discuss in the coming weeks about the ACA as well as potential changes in healthcare delivery and financing. I fear the trek to improve what our citizens see on both group and individual plans will be slow but we must continue the struggle.
Let me know what you think.

We can’t let up because we’re all in this together.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf

Charges concerning Sexual Harassment, rampant in the news lately, seem to be every where. It provides me a selfish opportunity to promote TPAs as a career path for women.

November 16, 2017

This Post is not intended to minimize the many stories about the impact of sexual harassment in the workplace. There is no way for most of us to know how being sexually harassed in the work place feels emotionally, spiritually, or physically especially chubby middle-aged guys like me. The stories are disgusting and abhorrent to any sense of normalcy in the workplace. So, this Post supports women in the workplace.

Let me frame the discussion. Your humble author has been married (to a women) for 32 years and I have three terrific daughters. In addition, I have worked at three TPAs in my career and each one of those companies has/had 70-90% female employees. The point is that I have personally witnessed the effort, input and sacrifices that women must make to be in the workforce.

That’s why I decided to write this shamelessly self-serving Post to promote the advantages of TPAs as a career choice for women. I have never heard of a harassment issue in this industry that was not dealt with immediately and appropriately. That’s why I think women should consider applying to and working for TPAs in their local community.

I am friends with many people at a number of TPAs and I have visited or know how many others operate. Without exception every TPA is dependent upon and could not function without the women employed. In my opinion this clearly shows that women are indispensable to these businesses. My opinion also includes other niches within the insurance industry.

Women routinely hold 50% to 90% of the management positions at TPAs including as  President, CEO, Vice-president, General Manager, CFO and other key positions. Women hold management positions in Accounting, Administration, Marketing, Sales, Customer Service, HR, Underwriting, as well as Technology just to name a few. Women also fill the multitude of staff positions which no TPA can live without in every aspect of the business.

At every TPA I know women are key to current operations as well as strategic planning for the future. It pains me to sound a bit sexist but women actually have advantages over men in the insurance industry. They are willing to work hard or harder than many men, they don’t feel entitled, they are more detail oriented, more empathetic to member’s issues and don’t doubt the power of a women’s gut feelings or intuition.

If I could give women career advice I would suggest strongly they investigate the insurance industry and specifically TPAs as career path. There are opportunities  available in all of the areas mentioned above. But maybe most of all, a woman will be appreciated and will be able to make a difference in the lives of many others without fear of harassment or of any inappropriate situation going uncorrected.

Don’t misunderstand, though, it takes a desire to learn the business with all of its regulations, policies, procedures and bureaucratic hassles. TPAs are the backbone for the delivery of employer sponsored benefits to millions of Americans but it is not an easy business, by any means. Maybe that’s why women have an advantage over men.

Forgive me for not focusing on the ongoing dilemma caused by the ACA but I felt it important to reach out to women to let them know they don’t need to put up with any bullsh##t in the workplace. And they won’t at a well managed TPA.

So, that’s it. Let me know what you think.
Concerning harassment, either sexual or any other kind, we are all in this together.

Until next week.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf