Archive for the ‘Affordale Care Act’ Category

Are Politicians and the Press trying to make Folks nervous about losing the ACA guidelines on “pre-existing conditions”? Should they be? Let’s discuss it.

July 19, 2018

According to a Poll by the Kaiser Family Foundation, about 65% of likely voters say a candidate’s support for continued protections for people with pre-existing health conditions is either the “single most important factor” or “very important” to their vote in the upcoming midterms elections.
That’s significant and important!

The KFF Poll also reports that 57% of the voters in the poll say that they or someone in their household has a pre-existing condition of some sort. Critically important!

Additionally, 76% of the public say it is “very important” that the law continue to prohibit insurers from denying coverage because of a person’s medical history. Finally, 72% say it is “very important” that the law continue to keep insurers from charging sick people more for coverage. 

Once again, I say thank you to the KFF team for compiling these numbers which demonstrate how important the issue of “pre-ex” is to our citizens. I would add that this issue has always been the foundation on which every healthcare reform project has either thrived or failed. It’s really a no-brainer so why are the Press and certain Politicians stoking the fire of fear in our citizens.

In 1992, California’s healthcare reform bill, referred to locally as Ab 1672, provided for guarantee issue (GI) and full take-over for small group plans. It included a “pre-ex” clause for new enrollees who had no coverage during the previous 60 days. If a new enrollee had not had coverage in the previous 60 days then anything for which the new member had received treatment  in the previous six months would not be covered by the new plan until the member is covered under the new plan for six months. At that point coverage was full for any benefits covered under the plan. Pretty reasonable, right?

I remember the hysteria in the Press as well as brokers and industry pundits about how much premiums would increase due the GI and no pre-ex. Here’s what happened. Premiums increased initially about 6% to as much as 12% during the first year or so. Then in the second, third and fourth year the insurers actually started reducing premiums. No one organized any parades nor did the Press praise the results about the premiums coming down, but we in the industry knew it and employers appreciated it.

The failure of Ab 1672 was that it did not address individual and family plans (IFP), those plans not sponsored by employers. That error or purposeful neglect of leadership is where the crisis began yet no one in California had the vision or courage to address it.

So, let’s fast forward to the bantering we here today by the Press and Politicians as they try to scare up support for themselves and chip away at the efforts being made to improve healthcare pricing, benefits, and access.

As we continue, remember that the problem they’re projecting is for the State Exchange members covered by Individual and Family Plans (IFPs). We know that only about 8 million Americans have coverage on these plans but that 80-90% of those receive subsidies making their coverage be free or nearly so. But the fear is legitimate and fare; but the hysteria is not helpful.

There is a rather simple solution but it won’t happen because no Politician is going to take the risk and endure the public criticism of providing a workable solution.

So, I will.
A few simple steps:

  1. IFPs continue to be GI with its timely enrollment guidelines unchanged.
  2. New enrollees, not covered by any IFP or group plan for the preceding 60 or 90 days, would not have coverage for any pre-existing condition for which treatment had been received with in the previous 6 months. 
  3. Once the new enrollee is covered continually for 6 months then coverage is provided for all benefits provided by the plan. 
  4. During the period in which pre-existing conditions are not covered the enrollee would have coverage for all other benefits under the plan.
    Example: If pre-ex is treatment for diabetes but the enrollee breaks a leg or develops cancer during fist 6 months on plan, the broken leg and cancer is covered.

The time frames above could be adjusted but the result would be significant:

  1. It would encourage continuous enrollment, without a IRS implemented fine as demanded by the ACA, especially if one has an on-going condition which according to the KFF poll 57% of families do.
  2. It would stabilize premiums. The current mandates and guidelines of the ACA actually push premiums higher. Plus, Insurers have no incentive to control premium and as long as Insurers get reimbursed for 85% of covered enrollees the Insurers won’t have any incentive to control premiums in the future.
  3. Citizens would no longer need to fear being without coverage or not being able to acquire coverage and best of all, premiums would be lower.

That’s pretty easy.
Next, we add in the new Association Health Plans approved by President Trump and  we would see a revival of stability, faith and confidence in our healthcare delivery and finance system.

Of course we still need to deal with the core cost issues such as smoking, obesity and drug usage to really get the job done. But that’s for another day.

If we could encourage a healthy life style that is rewarded by a health plan while addressing the Unit Cost of Care” we will have made our healthcare system great again.
Sorry, that’s a dopey closing statement, but we could get it done.

That is if, we’re all in this together.
Until Next week.

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

July 4th is a “uniquely American date” as the Celebration of our Independence. Let’s look at it’s history.

June 28, 2018

Let’s take a day off from our normal healthcare reform discussions.

Next week we celebrate the 4th of July which at its core is why we have the freedoms we enjoy and for which so many have fought. No where in the course of history on this planet has any nation achieved what the USA has or is trying to retain. So, let’s take a moment to remember why we have the freedoms to debate and disagree.
Please enjoy the brief history and interesting facts to follow:

Have you ever wondered why we celebrate the Fourth of July or the risk our original Founders took to make July 4th significant to us? Many people think we celebrate the Fourth of July because it is the day we received our Independence from England on July 4th 1776.  Not true because it would be another 7 years before we would gain our independence because the war with England to gain independence did not end until 1783.

When the original 13 colonies were first settled, and before we were called the United States, England pretty much allowed the colonies to develop freely without much interference. But starting around 1763 Britain decided that they needed to take more control over the colonies(which means money) and that the colonies needed to return revenue(taxes) to the mother country. England’s reasoning was that it provided protection to the colonies so the colonies needed to pay for their defense.

But the colonies did not agree and felt that since they were not represented in Parliament (Congress) that they shouldn’t have to pay taxes to England, which gave origin to the phrase “no taxation without representation”. But England continued to tax which led the colonies to form the First Continental Congress with the intent to persuade the British government to recognize the rights of the colonies. Of course England did not so a war was declared, which we call the American Revolution.

Most folks forget that the American Revolution (the war) lasted for nearly 10 years. Failing to get satisfaction at first, the leaders of the 13 colonies organized a second Continental Congress. It is this group that adopted the final draft of the Declaration of Independence. The first draft of the Declaration of Independence was written by Thomas Jefferson, it was revised by Ben Franklin, John Adams, and Thomas Jefferson before it was sent the Continental Congress for approval.

The Declaration was finished and ready for signature on July 2nd but was not voted upon and approved until 2 days later. All thirteen colonies stood behind the Declaration of Independence and adopted it in full on July 4, 1776.

The Fourth of July is known as Independence Day because that is the day that the Second Continental Congress adopted the full and formal Declaration of Independence. Even though we had declared that we were independent, the American Revolution was still being fought, which meant that we were still not independent.

After the war ended in 1783 the Fourth of July was celebrated for its importance and shortly thereafter became a holiday. We celebrate the Fourth of July as the most patriotic holiday celebrated in the United States.

Maybe our political leaders from both parties and at every level of government from local school boards to the US House and Senate would be wise to remember how it is that we celebrate the 4th of July to this day.
Below are some interesting facts you might enjoy.

Let’s all remember why we love the USA as well as how brave and wise our Founders must have been.

Did you know:
The Fourth of July commemorates the adoption of the Declaration of Independence. It was initially adopted by Congress on July 2, 1776, but then it was revised and the final version was adopted two days later.

  • As Thomas Jefferson penned the Declaration, Britain’s army was on its way toward to New York Harbor. It began:
    “When in the course of human events, it becomes necessary for one people to dissolve the political bands which have connected them with another, and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature’s God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.
  • The Declaration of Independence was signed by 56 men representing the 13 colonies. The moment marked the beginning of all-out war against the British. The American Revolutionary War is said to have started in 1775, however. The Declaration was signed more than two years after Boston officials refused to return three shiploads of taxed tea to Britain, fueling colonists to dump the tea into the harbor in what became the infamous Boston Tea Party.
  • Several countries used the Declaration of Independence as a beacon in their own struggles for freedom. Among them, France. Then later, Greece, Poland, Russia and many countries in South America.
  • “Yankee Doodle,” one of many patriotic songs in the United States, was originally sung prior to the Revolution by British military officers who mocked the unorganized and buckskin-wearing “Yankees” with whom they fought during the French and Indian War.
  • The “Star Spangled Banner” wasn’t written until Francis Scott Key wrote a poem stemming from observations in 1814, when the British relentlessly attacked Baltimore’s Fort McHenry during the War of 1812. It was later put to music, though not decreed the official national anthem of the United States until 1931.
  • We’ve grown up: In 1776, there were about 2.5 million people living in the newly independent United States, according to the U.S. Censure Bureau. Today there over 330 million  citizens in the US so let’s hope all of us as Americans will celebrate Independence Day.

We hope you enjoyed the brief respite from the frustrating conversations concerning the reform of the US healthcare system. I wish to thank the folks at LiveScience for their research and insight.

Next week will be off in honor of Independence Day.
Maybe then we can get back to thinking America first because we are all in this together!!

Until  we talk again.

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

 

 

Will elimination of the Individual Mandate hurt or help. Will Insurers benefit, they always seem to. But, how will our citizens benefit? Maybe it’s time to implement reasonable Pre-ex standards.

June 21, 2018

Jeez, I hate long titles, don’t you? But, sometimes one can’t help it.
Most Americans are not aware that there are 20 GOP-led states suing the Untied States to eliminate portions of the Affordable Care Act. Specifically, the suit argues the Individual Mandate is unconstitutional since the penalty for non-compliance has been reduced to zero.

Opponents of the suit fear that this will lead to the elimination of certain critical
protections. Their fears are that the provisions within the ACA that guarantee access to coverage as well coverage for pre-existing conditions, without exception. These two provisions are critical for individuals seeking coverage. But, they were also a catalyst leading to the huge-unprecedented increases in premium levels. Not the only reason for premiums increasing but certainly a big part of it.

The Press is being a little misleading about this or at least jumping ahead to conclusions that can’t honestly be made. Many reports state that if the GOP lead suit is successful then it “may” also cause similar issues for people covered on small group plans. I don’t agree with those conclusions because small employer plans were already regulated in every state to be GI and full take-over for previous coverage.

In small employer plans, pre-ACA, an employee signing up for his/her employer’s plan was provided guaranteed issue (GI) and if the employee had coverage within the previous 90 days was granted full take over. Full take over means no pre-existing conditions would be denied.

An important additional provisions was that small group plans, pre-ACA, included very reasonable provisions for new enrollees with no previous coverage. Generally these provisions stated that if a new enrollee, with no coverage in previous 90 days, had been treated for something in the past 6 months, the new plan would not pay for treatment for that condition until covered on the new plan for 6 months. Smart pre-ex provision that help control premiums and it prevented people from “gaming” the system.

We have discussed GI with reasonable Pre-ex provisions in a number of previous Posts, so you know what should be considered. Without a mandate, with teeth, the Insurers will be “gamed” if GI remains in place for individuals. Why pay for something now if the law says you can buy it later when you need it?

Maybe the result of the battle will be that Individual and Small Group Plans will remain GI but return to the reasonable pre-ex provisions most states mandated for the past 20 years. Specifically, if you sign up now, but had no coverage within the past 60 days, then you are accepted for coverage, except the plan is not required to pay for that which you’ve received treatment during the past 6 months until you have been cover for 6 month on the new plan.

If the new plan is replacing a current plan then the new plan is GI with full take over of coverage for all benefits covered under the new plan. Simple, smart, protects all Americans equally while providing protection for Insurers, too. It also protects those Americans, who always maintain their coverage, from those few Americans who try to “game” the system. The “gamers” cost Insurers but they also cost the rest of us since our premiums include an actuarial estimate for the Insurers cost of providing coverage to the “gamers”.

A reasonable provision for GI and Pre-ex conditions is an example, once again, of why we’re all in this together.

Until next week.

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

 

 

A special post Mother’s Day Post. Everyone has or had a Mother and we generally honor them on Mother’s Day. But do you ever wonder what your delivery cost your Mother? Let’s look.

May 17, 2018

I know that you are reading this after Mom’s special day but give me two minutes to enlighten you on the cost to your Mom, at least medical cost, of bringing you in to this world. Now, I can’t address all that you cost your Mom since then but that is another day.

The tipping point for maternity costs, all medical costs really, was 1967 and the Medicare Act. Yep, that grand old bill that 80+ million Americans count on today was the catalyst for an explosion in healthcare costs.

My first daughter was born in 1986. When we visited the hospital where she would be delivered we were ushered into a room with dozens of other hopeful couples. The hospital staff’s goal was to convince us to utilize their hospital when our lucky day arrived. So, they presented all of the terrific features the hospital offered as well promoted their staff as being experienced, caring and loveing what they do.

The hospital administrator presented several option for delivery each having a different price attached as well as easy payment plans, if desired.

  • If you just planned to stop in, pop out the new little one, then go home in less than 22 hours the cost would be $1,800. I remember the 22 hours comment specifically because I remembered thinking, how does someone get in, deliver a child, and get out in 22 hours.
  • Then, for you more traditional types who plan to take your time, labor for 20 hours, then get some rest before you go home and the cost would be $5,600. I remember the $5,600 because it struck me as an arbitrary number and I wondered how many times they actually kept to that estimate.
    Heck, we all know aspirin cost $12-$18, depending on time of day.
  • Now, for you couples who might have a little complication in delivery or just want to choose the day and time of day your baby is born, they offered cesarean or C-section delivery. That was $12,800. For that price they’ll let you stay 3-4 days, teach the Dad how to change a diaper and feed you a steak & lobster dinner on your last night. Got to admit, the steak and lobster was pretty good.

That experience was at a respected hospital in the west San Fernando Valley of California. These prices, as well as last meal, vary greatly as one crosses the country.

I remember people telling me what a delivery would cost in “the old days”. Great friends of ours, who were 30 years older, regaled me with stories of how their first son, born in 1953 cost $250. Plus they paid the nurse $50, just because she was so nice to them.
I’ve had dinner for 4 in the San Fernando Valley that cost more than $250.

We’ve all heard the stories of the doctor getting paid a couple of chickens or a prize pig for his OB work. I can’t imagine the anguish of giving up my prize pig. That’ll make sense for those of you who know my origins.

On the other end of the spectrum there are the unfortunate many who have premature or early delivery or other complications. In 1993, I heard Leonard Schaffer, former CEO of Blue Cross of Ca., state to a group that  Blue Cross of Ca. had a $1 million baby born every week. He did not mean it in any glib sense but only as a fact related to healthcare cost that would be meaningful to the group.

In 2018, babies are as adorable as ever but a lot more expensive. Again, I’m speaking only of delivery, not the other stuff they cost their parents. But as we celebrate or rather celebrated Mother’s Day we should all reflect on this lesson to share with our kids.

Abstinence is the only means to 100% prevent pregnancy. Seriously.
Jeez, that sounded like Smokey the Bear and his forest fire warning. That doesn’t work either.

The point in this post Mother’s Day Post is that we love our Mom’s, or the memories of our Mom’s and this day gives us a chance to pause to be thankful. But also that it’s a great example of how healthcare has changed in both services available and costs. It also amplifies the urgency to solve the crisis in healthcare cost and access.
Plus, because of our Mom, we’re all in this together!

Until next week.

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

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”.

 

Insurers expected to increase ACA premiums sharply this Fall because they did not get their “bail out” funds. Guess who gets the blame?

April 12, 2018

 

Isn’t it interesting that when predictions come true about the failures of the ACA, the Left and the Media go looking for someone to blame? In this case the failure predicted is collapse of ACA State Exchanges with the projected “premium spikes” for the Fall of 2018 and the blame goes to Congress and the President.

But the blame game continues as Insurers, politicians at every level, and the Media lay the blame for the expected premium increase squarely on the Congress and the President. The “blamer’s” logic is that Congress failed to include any funding for bailing out Insurers in the Tax Reduction and Jobs Act in December 2017.

 The “blamers” also are saying that the GOP  had a chance to lower rates with an amendment that a couple Republicans had hoped to attach to the $1.3 billion  spending package passed on March 23, 2018.

Let’s clarify a couple things:

  • The ACA’s re-insurance “subsidy” program paid participating insurers huge taxpayer subsidies from 2014 until the program was scheduled to expire at the end of 2016.
  • The subsidies were designed help get the ACA Exchanges up and running but not remain intact beyond that point. The intent was to cover two issues:
    • One – the claims of high-cost patients for whom the law’s preexisting-conditions provisions provided guaranteed coverage.
    • The extra subsidies were supposed to keep premiums from skyrocketing. Obviously that failed as premium increased astronomically each year since 2010. By the end of 2016, premiums had doubled from pre-ACA levels.
  • The premium spikes you are hearing about will only affect the individual plans in state exchanges, the so-called Obamacare Plans. The premium increase will impact less than 10 million Americans and 90% of those receive subsidies so they pay almost nothing for their coverage and care. 
  • These points are important to remember because the Media will try to stir up activist who will then cry for single payer.

 You know this Post is no fan of the GOP’s efforts to R&R the ACA over the past 12 months, actually past 7 years. Additionally, we predicted delays and Democrat inspired litigation issues as the GOP continues its piecemeal approach to fixing our healthcare finance and delivery system.

We have already witnessed evidence of this by the lawsuits filed against the President’s efforts for Association Health Plans and allowing Short Term Medical plans to extend to 12 months.

Who does this lack of “bail out” impact the most? The Media would try to make you believe that the folks covered will be harmed but as we stated earlier that is untrue since 90% of the folks covered by these Omabacare plans pay nothing or almost nothing for their premium or services that they receive.

So, who else does this impact? The answer is the states that so enthusiastically embraced the ACA and rushed to create their Exchanges back in 2010 through 2014. They knew that their citizens would get the subsidies offered so they anticipated great enrollment numbers and enrollees would be “hooked” on Obamacare and unable to leave. It’s the so-called “blue” states feeling the biggest impact.

Reports indicate that some states are seeking their own solutions. Ironically, this funding issue may actually cause states to adopt realistic changes and better solutions than the ACA could ever provide. Let’s face it, government bailouts, especially bailouts for government initiated programs, seldom resolve issues and generally lead to more and more funding. Lot’s of examples of that over the pass 50 years.

Some reports indicate that a few states (mostly blue) are looking for how a they could restore the individual mandate (IM). Actually, there are many experts,”real experts”, who believe the elimination of the IM will lead to more reliance on Employer sponsored coverage thus reliving that burden on the states where the citizen lives.
Two things come to mind about that.

  • One – Employer sponsored plans tend to be less costly to members and provide richer benefits than the ACA individual plans.
  • But we wonder- Do “blue” states really want their citizens to leave the state-run and controlled plan for an Employer’s plan? The state would lose control/dominance over that member so you decide the state’s motivation.
  • States are in the news about their plight and their possible steps to fund the Insurers themselves. But will any of them really step up? Or is it just talk?
  • It is realistic to see states take steps to utilize the opportunities President Trump set forward with AHPs and 12 month Short term Med Plans. We’ve already seen efforts by Utah, Iowa, and Wisconsin to initiate steps in that direction.
    Of course, the Dems have threatened litigation.

In an election year it’s easy to predict that these issues will get much press, mostly uninformed or lopsided, but that noting will be resolved. As we’ve witnesses in the discussion concerning the Daca folks and immigration, issues are more important than solutions for certain politicians.
This premium spike issue will work for candidates because most or our citizens will not realize that it affects only the Exchange Individual plans (less than 10 Million people) which is less than 3% of our total population.

The states that ramped up their subsidized Exchange Plans as well  as expanded Medicaid eligibility are in a financial bind. As stated by Mila Kofman, executive director of the D.C. health exchange, “States don’t print money, and individual markets, to become stable, need an infusion of federal dollars,”. Doesn’t the verbalization that “states don’t print money” sound a bit creepy coming from a bureaucrat’s mouth?

In 2010 to 2014, many of us predicted that the ACA subsidy program would become an issue, when it became clear to us that the Federal funding for these programs would cease in 2016. Come on…, we all know that States receiving Federal subsidies is like an addiction! Did anyone expect States to wean themselves off the addiction?

You can see now that while the Media gives time for politicians (including a few in the GOP) to complain and lay blame the crisis was predictable and the solutions are available. But, it’s an off-year election year so getting elected and re-elected is more important than real solutions.

What do you think? In this case we truly are all in this together because the assistance the politicians seek for less than 10 million will adversely impact 330 million of us.
Again, that’s 330 million people impacted so, we really are in this together!

Until next week,

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

 

 

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
559-250-2000
mark@reynolds.wtf 

 

 

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
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”

Healthcare utilization drops but healthcare costs increase. What’s up with that? That’s right, Americans used less healthcare but costs increased?

February 15, 2018

As you can imagine (or at least hope) there are groups that closely study the results of American’s consumption of healthcare and the cost of delivering that care. The Health Care Cost Institute (HCCI) is one of those groups. The following is a short summary of HCCI’s recent study as well as facts about healthcare. It’s very interesting and supports the ideas and actions supported by your humble author in earlier Posts.

HCCI’s annual Health Care Cost and Utilization Report analyzes health care spending and utilization from 2012 to 2016 for people up to age 65 with employer-sponsored health insurance. That means HCCI analyzed actual utilization data from employer group plans.

One of the many interesting facts identified by HCCI’s analysis is, Americans consumed (used) the same amount or less health care in 2016 than they did in 2015. However, rising prices caused overall spending in 2016 to grow faster than any time in the last five years. 

Niall Brennan, president of HCCI, states;
“It is time to have a national conversation on the role of price increases in the growth of health care spending,” said Niall Brennan, MPP, president of HCCI. “Despite the progress made in recent years on value-based care, the reality is that working Americans are using less care but paying more for it every year. Rising prices, especially for prescription drugs, surgery, and emergency department visits, have been primary drivers of faster growth in recent years.” (HCCI Press release)

Here are some of HCCI’s facts & conclusions:

  • While the number of emergency room visits rose just slightly, the average price for an emergency room visit grew steadily over the five-year study for a 31.5 percent cumulative increase, driving the increase in outpatient spending.
  • The average price of surgery went up as well, pushing up spending for both inpatient and outpatient care.
  • The average price for surgical admissions increased by nearly $10,000 or 30 percent over the five-year study period, despite a -16 percent cumulative decline in utilization.
  • The price for outpatient surgery rose more than 19 percent.
  • Over the five-year study period, prescription drug spending had cumulative growth of 27 percent, despite a flat or decreasing trend in generic drug prices and despite a decline in utilization of brand prescription drugs.
    *The increased spending was driven by double-digit price increases from 2012 to 2016 for brand prescription drugs.
  • Total spending on primary care office visits fell by almost 6 percent over five years due to a decline in the number of visits.
    *This was offset by a 31 percent spending increase on office visits to specialists and a 23 percent increase in visits for preventive care, changes that could be partly attributable to changes in billing practices or in the way people seek care.

“While consumers, especially those with employer-sponsored insurance, may not feel the direct impact of these charges via out of pocket payments, they ultimately pay through increased premiums and decreased benefits,” added Mr. Brennan.

Are these conclusions realistic – Yes!

  • Since 2011, HCCI has tracked, independently analyzed, and reported health care spending, utilization, and prices each year in its Health Care Cost and Utilization Report using de-identified claims data of people up to age 65 with employer-sponsored health insurance.
  • For this report, HCCI analyzed data from roughly 4 billion claims of nearly 40 million individuals. Claims data came from four of the largest health insurance providers in the U.S. representing about 26 percent of the employer-sponsored insured population. 

Isn’t it interesting that as utilization of healthcare services goes down the overall cost of health care goes up for both employees and employers?

Makes one ask: Why is it that when the Government gets involved costs go up and its the average tax-paying premium-paying citizen who bares the brunt of that cost increase.

  • It happened with Medicare and Medicaid.
  • It happens with military costs.
  • It happens with roads, bridges and all other infra-structure costs.

Why would we be surprised that the Government mandated Affordable Care Act would increase the costs on that which it sought and still alleges it controls?

It almost makes me want to re-print a couple dozen of our previous posts that describe how to lower cost while increasing coverage and access to healthcare. But, I won’t.

We want to thank the Health Care Cost Institute for its reporting and for the effort it makes to gather the information it reports. Americans would be doomed were it not for organizations that watch over our nation to report back to us.
Lord knows we can’t depend on the Press  any more, to do that! Sorry, that’s the cynic in me!

In the weeks to come, as we look at various efforts to create alternatives to the ACA, we will include additional statistics concerning healthcare utilization and spending. The statistics and utilization figures we have captured for years could help build solutions that lower costs to employers, employees and members while increasing benefits and access.

It isn’t that hard!

Let me know if the stats above shock you or infuriate you. I look forward to seeing what comes out of the many States that are trying to overcome the ACA. We’re in this together so let’s shout out when we see something that makes sense.

Until next week.

Mark Reynolds, RHU
559250-2000
mark@reynolds.wtf