The “Right to Shop” For Health Care
Anyone who has undergone a medical procedure knows it is very difficult to figure out how much an insured patient will pay out-of-pocket. It is often not clarified for months after the procedure, after a flurry of incomprehensible paperwork from insurers, doctors, labs, et cetera, has landed in the patient’s mailbox.
(Personal aside: A couple of years ago, my health insurer encouraged me to go paperless, and I signed up for electronic messages about claims. It was so confusing, I went back to paper after a few months. At least you can scrunch up a letter and throw it across the room with an anguished scream, which you don’t want to do with your computer.)
This problem has led to a bunch of state laws attempting to impose “price transparency” on medical providers. As discussed previously, they do not work, because relationships between insurers and providers inhibit transparency. Medical providers “customers” are insurers, which pay most of their claims, not patients. Further, the real problem with medical prices is not that they are opaque, but that they are not formed in a normal market process. Instead, they are negotiated by third-party bureaucracies.
“Right to Shop,” a proposal developed and championed by the Foundation for Government Accountability, takes another approach to the problem. As described in Forbes by Josh Archambault, the Right to Shop is pretty straightforward. State law would require medical providers to give good faith estimates of charges for procedures. Insurers and in-network providers would be required to share their negotiated charges with patients. If a patient gets a procedure at lower cost than the negotiated charge, the insurers must share some of the savings with the patient.
Mr. Archambault reports Right to Shop has already succeeded in New Hampshire, where Anthem Blue Cross implemented it for state employees. In 2015, it saved a total of $12 million, of which one million dollars was paid out to patients. It is not clear who benefitted from the $11 million balance. It would be good to know how much went to taxpayers and how much to the insurer! Nevertheless, it is a step in the right direction.
Right to Shop would impose some reporting and compliance burden on both insurers and providers, which is difficult to endorse. Further, it is easy to underestimate insurers’ and medical providers’ commitment to the status quo, which benefits them because it causes above-market prices. They will be very committed to undermining the Right to Shop.
On the other hand, because it is an initiative among the states, the law can be tweaked and it will be easier to learn how to improve it than if it is imposed nationally. Right to Shop will not fix everything in our overly expensive health system, but it is a positive proposal that would have an impact in the right direction.
TIME Insurance Company had a service where consumers could get the cost of a procedure in advance from various providers in their area and the price was guaranteed for 90 days. I told you about it several times John and now you pretend that it cannot be done. Of course TIME was much more organized than the medical providers or other insurance companies.
But of course, TIME Insurance Company, America’s oldest health insurance company, in 44 states (more than any competitor) was run out of business because of Obamacare. So Barry is happy because he hates competition to employer-based insurance companies and their legal rights to TERMINATE sick young female employees who have cancer and cannot work the required 30-hours-per-week.
TIME proved that transparency is easy.
The situation would rapidly change for the better if “right to shop” were extended to purchase of medical care outside the USSA borders.
Jimbino, you have the right to purchase medical care wherever you like – Cuba, Venezuela,, Colombia, Brazil, wherever.
What you don’t have is some right to use the United States government to force me to subsidize your medical care wherever you like.
Cuba, Venezuela,, Colombia, Brazil, wherever.
Asking others to pay for your health care is hard-coded into Medicaid, Medicare and Obamacare. Unfair of course.
What is totally unfair in Medicare and Obamacare is that a person paying for his own medical care outside the USSA is required to subscribe to insurance that is of no use to him.
As bad as Social Security is, you are not forced to pay into it if you are not working inside the USSA and, if you have paid 45-years’-worth of SS premiums, you DO get your SS benefit regardless of where you live.
“Asking others to pay for your health care is hard-coded into Medicaid, Medicare and Obamacare.” True. If you don’t like them, don’t buy them.
“Unfair of course”
It’s your choice to live outside the US. You claim the medical care in most workers’ paradises is superior to America’s – and that it costs less. Well, you made your deal. Why continue with your tiresome whining?
“a person paying for his own medical care outside the USSA is required to subscribe to insurance that is of no use to him.”
Only for so long as you live in the US. Move out, you are no longer required to subscribe to any of those. And you know it.
“if you have paid 45-years’-worth of SS premiums, you DO get your SS benefit regardless of where you live”
Er, I think that would be 40 quarters minimum – not 45 years. And yes, a SS pension is payable anywhere – just as a private pension is. Which is not relevant to medical insurance.
It’s hard to be you, isn’t it Jimbino?
Would it not be easier to mandate insurance companies must pay claims to the owners of the policy?
Blue Cross in North Carolina did precisely that for some out-of-network hospitals. The hospitals, one of which was Grady Memorial in Atlanta, discovered patients who receive a $5,000 check in the mail addressed to them sometimes cash the check and don’t bother to pay the hospital!
Devon, there seems to be a glaring contradiction in this statement and NCPA’s longstanding and general assertion that the only way for free market principles to take root in health care is to give patients more control over their health care dollars and decisions.
The implication here is that patients cannot be trusted with being good stewards of their health care dollars and decisions.
Should free market principles to be abandoned because in some cases somewhere people acted negligently, dishonestly, or fraudulently when given control over health care purchases?
Care to elaborate?
I don’t know whether the problem of patients keeping funds owed to the hospital was widespread or isolated. But I believe you are wrong on one technicality. This was not patients’ health care dollars they owned and controlled. It was insurers’ dollars that were owed to the hospital but given to the patient because the hospital refused to sign a network agreement. The patients then owed the hospital. The patients in this example were not comparison shopping, they were embezzling.
We are very much in favor of the casualty model in health care. Under a casualty model, the insurer would probably help the patient comparison shop and then a check would be assigned to both patient and hospital. That would prevent abuse.
When my Mercedes suffered a rather minor fender bender and the insurer gave me an estimate for $1,500 and cut a check, it was mine to decide what to do with. But after a patient has picked Grady Memorial, had work done there and decides to keep the check, that is fraud. But Blue Cross didn’t actually care, they expected some unscrupulous enrollees to keep the money. One guy ran up $70,000 worth of care over a long period and kept the money. In reality, the patient probably went to the ER and ask for care just as a means to make money.
Sure, Devon, it just seemed like an odd example given in response to a call for the repeal of assignment of benefits laws, especially from those who have traditionally promoted more consumer (patient) control as a solution to rising healthcare costs.
The “casualty model” (or reference pricing) still relies on patients to actually pay their bills when due. Seems like your anecdotal examples from NC could be turned against you in this regard.
Regardless, I thought the previous poster implicitly raises a legitimate policy question: are assignment of benefits laws beneficial? Do they contribute to opacity in healthcare pricing? I think it’s worth studying whether there is a causal relationship between the passage of assignment of benefits laws and the rapid erosion of transparency in health care transactions. A cursory historical glance at least suggests a correlation.
I would also think that an organization that has dedicated so much time and energy to promoting policies that empower health care consumers would not want to dismiss out of hand the repeal of a law that, by its very definition and intent, totally removes the patient from health care transactions.
I don’t see the justice in an assignment of benefits mandate for out-of-network hospitals. I am not a fan of networks as currently designed, but if the hospital has to collect money from patients directly, that is what it has to do.
Lee, IMO it would be better for insurance to be the patient’s insurance and not anyone else’s. If that is the case then patients would be more active in monitoring their bills. Until recent decades Medicare paid the patient, not the doctor which was a tremendous mistake. That was the collectivist approach. The government took over the job of parent.
I was much happier when the patient paid and Medicare reimbursed. There weren’t as many ethical questions and I diidn’t have to ration care except at the patient’s direction. It is better for the doctor and patient to have a relationship without direct government involvement.
Lee, as you may know, this is how things used to work, until doctors and hospitals pushed mandates across the states called “assignment of benefits” laws, which mandates that insurance companies pay claims directly to providers.
So, your solution would not be an additional mandate but, rather, the repeal of one.
The attached article is I think a good demonstration of why the Right to Shop is a good step………
http://www.healthworkscollective.com/jeanne-pinder/315864/having-insurance-doesn-t-always-pay-case-1700-mammogram
note to Ron:
You are basically right about Time Insurance Co., but the actual circumstances are interesting.
Time and its subsidiary Assurant lost about $60 million on ACA
business, because they jumped in with low rates and got a lot of sick policyholders.
They expected to get at least $30 million back from one of the ACA risk corridor funds, but the federal money never came in.
So the management of Time decided right away that individual health insurance was not profitable, and got out early.
The supporters of the ACA are going to have to face the fact that if they want insurers to participate, they had better let the insurers make money.
Actually Medicare Advantage has had some moments when insurers were on the verge of deserting the program. But Congress was (and is) quite generous to insurers to keep them on board. This is in part because seniors are a major voting bloc, versus the recipients of Obamacare who are a negligible voting bloc.
Or as the non-profit hospitals like to tell us: “No margin, no mission.” They have to at least cover their fully allocated costs, including the cost of capital, to stay in business over the long term.
Bob, FORTIS owned several insurance companies including TIME. In 2004 FORTIS spun these insurance companies off with the IPO called Assurant.
TIME had the lowest priced PPO in the state of Florida when they entered the Exchange on 1/1/2015 and by 1/10/2015 (10 days) they had terminated all agents commissions.
TIME had broad national PPO networks and all of the really sick people wanted the best insurance.
A big flaw with Obamacare is that if there is a quality insurance program the sick will jump on it. It would be smarter to have skimpy networks because healthy people don’t care. Then if you do get a sick consumer give them terrible customer service and hopefully they will switch away.
That is the problem with Socialists. They say we have to pass the bill to find out what is in it.
I read Josh Archambault’s article in Forbes and the idea of “right to shop” intrigued me as well. The one idea we have at NCPA that I do not believe is in Josh’s plan is that we would further make it more difficult for providers to collect their fees when there was not a good faith estimate and agreement signed by the provider and patient.
By the way, the definition of “good faith” is not a blanket agreement (saying you will pay everything billed you by anyone we affiliate with the hospital regardless of how unfair) stuck in a patient’s face by the hospital business office upon admission.
Agree, Devon, that it seems “half-baked” for this idea to omit the balance billing issue which seems to be the most harmful effect of health care opacity.
You are correct that our idea would help with the balance billing problem. But our primary goal was to make providers want to discuss prices. We don’t care what they charge; they just have to let the patient know ahead of time if they want help from the legal system to collect their fees. In contract law, there has to be a meeting of the minds for a contract to be enforceable. Meeting of the minds is hardly achieved when a hospital admissions clerk shoves a form in your face and makes you sign it.
Seems like we’re playing semantics here, but I’m not sure the two are mutually exclusive. The balance billing problem, such that it is actually a “problem,” stems directly from the failure/refusal to discuss prices. I didn’t mean to imply that there’s anything inherently wrong with balance billing, which some have suggested can be a positive thing (as your former President and CEO was fond of pointing out when discussing Medicare/Medicaid reimbursement).
John,
It’s interesting that you ignore the irony of FGA, a free market organization, identifying a solution created by the market–not the legislature–in New Hampshire, and, in turn, forcing said solution on other states via legislative mandate. While I respect Mr. Archambault and have generally found his work on health care in the past compelling, it seems FGA has abandoned its identity on this issue. I think FGA would better serve its mission here by dedicating its resources to educating other state employee health plan administrators on the virtues of this type of program. Doing so would have the added benefit of abandoning the mandate element of this policy initiative which so many fellow SPN groups throughout the country wholly rejected last year when Josh began “shopping” the policy at SPN’s annual meeting.
Has FGA, like President George W. Bush, “abandoned free market principles to save the free market system”? Is NCPA endorsing this mandate when other SPN groups have largely rejected it?
Inquiring minds want to know!
Perhaps you skipped over the words “difficult to endorse” in my entry? It is not perfect, but it is a step in the right direction. Remember individuals do not own our own insurance, our employers do, and states cannot fix that. So, state reforms have to work around that.
P.S. As to your question about the $11 million in savings, New Hampshire’s state employee health plan is likely self-funded, like other state plans/large employers. Absent some agreement specific to this “right to shop” program, any savings (i.e. money NOT paid in claims) would simply not be paid by the state plan. Depending on how the plan is funded, this would either be a savings to taxpayers, state employees, or some combination of the two. Since Anthem is a third party administrator and not at-risk on the NH plan, it’s unlikely that the insurer would get a lion’s share of the savings under the program, unless NH health plan administrators agreed to a really bad deal.
William Moore, I think these New Hampshire state employees’ administrators might be a bunch of crooks. In 2010 the COBRA cost for employees was a whopping $2,196.58 per month. That is $26,352 a year – 6 years ago. These people need some help so Anthem stops stealing from the taxpayer.
http://admin.state.nh.us/hr/cobra.html
In a free and open market these workers would not be scammed so bad, it’s pathetic William Moore.
Good news William Moore, more news. The cost for COBRA has really gone up for these state employees. Talk about scamming the taxpayers, it’s unreal.
The COBRA cost in 2016 is $2,657.47 a month or $31,889 a year, what a joke.
These New Hampshire people need a free and open market pronto because this corruption is just too much.
https://das.nh.gov/hr/cobra16.html
Wait a couple of months and the cost will go up again.
Like most state and local employee health plans in the Northeast and Mid-Atlantic regions of the country, health insurance coverage is gold plated. Deductibles are low and sometimes even zero. There are a lot of older folks in the workforce who have spent their entire career in government. They file a lot of claims. This is what it costs to cover this pool of workers. Insurer greed has nothing to do with it since these are ASO contracts, not full risk contracts.
When you see how hard the unions fight when government entities try bargain for even minor savings from the health insurance plan, that bargaining stance presumably reflects the wishes of the majority of its membership. They don’t want your freedom, Ron. They want complete economic security when it comes to health insurance at least until they get laid off during a budget crunch or get too sick to work. When that happens, they can’t afford the COBRA coverage in most cases. No surprise there.
Barry, you write, “Like most state and local employee health plans in the Northeast and Mid-Atlantic regions of the country, health insurance coverage is gold plated. Deductibles are low and sometimes even zero.”
NO WAY BARRY!! These poor employees owe $3,000 if they get sick per person and $6,000 per family. PLUS, it’s not a PPO but a lowly dangerous HMO and POS, geez, what schmucks.
Anthem and the unions are playing these poor state workers for suckers. The taxpayers are being raped too. If we know the truth there is probably illegal kickbacks if Anthem is involved.
Summary of Benefits and Coverage: What this Plan Covers: Read’em and weep:
https://das.nh.gov/hr/documents/2016%20SONH%20Active%20POS%20SBC.pdf
Workers need the RIGHT TO SHOP FOR HEALTH INSURANCE!!
You should try reading your own links Ron. The $2,657.47 per month COBRA cost is for the POS plan. The HMO plan is $2,176.45 per month or 18.1% less. The POS plan in network individual / family deductible is $500 / $1,000 and the OOP maximum is $1,000 / $2,000. The $3,000 / $6,000 number that you cited is for out of network care. Insurers will tell you that only about 5% of their claims at most are for out of network care. Like I said, the $500 / $1,000 in network deductible is LOW. So is the in network OOP.
Anthem, for its part, doesn’t make any more money on its ASO contract if COBRA monthly costs are $2,600 than it would if they were $400. The unions are trying to give their members what most of them say they want. Geez.
Correct, the $3,000 maximum Out-Of-Pocket does not include balance billing. “Even though you pay these expenses, they don’t count toward the out–of–pocket limit.”
Barry, this plan is a pig-in-a-poke that costs a sick bald-headed female employee, who is too sick to work with cancer, $31,889 a year. It’s like highway robbery.
Trust me, if these employees were in charge, they had the FREEDOM to choose, they would not give this mountain of money for this over-priced Blue Cross health insurance. They need freedom from their Unions that are selling them out to make big money on kickbacks.
A 30-year-old couple and 2 children could get HSA insurance for $200 a month before Obamacare from TIME in NH.
Admit it Barry, employer-based health insurance is way over-priced and dangerous if the employee gets too sick to work.
Charging employees 10 times too much is a scam.
How much for a 60 year old couple with two kids before Obamacare out of curiosity? You always only seem to quote premiums for young people.
Barry, here is a 2 minute video about your HMO hero Hillary. Remember in the 1990’s when she wanted everybody on HMOs? Well, she is coming for your grandchildren too if she is the healthcare dictator in the US.
There is no limit to her evil.
https://www.youtube.com/watch?v=BdNHf1g4ivA
Barry, plain and simple they want someone else to pay their bills and fully recognize that. Freedom is not the issue here. They would not approve if they were paying for what they want.
Sorry, Ron, I’m not following you here.
In a self-funded plan, premiums go to the plan (i.e. the employer, the state of New Hampshire), not the third party administrator who processes the claims on the plan’s behalf (i.e. Anthem). Anthem would simply receive an administrative fee for servicing the claims/maintaining the provider networks, but does not stand to profit on the difference between premiums and claims. Any profit (i.e. savings) would be retained by the self-funded plan. Additionally, premium rates (like cobra cited above) would be set by the state health benefits plan administrators (state employees), not the third party administrator (Anthem).
Also, I’m not sure what this has to do with FGA’s proposal to push this program nationwide via legislative mandate.
New Hampshire’s one-size-fits-all over-priced health insurance is not free markets. Employees are treated like slaves and don’t have choices and competition to keep costs low and quality high.
Vote for Trump and support age-based tax credits so these poor New Hampshire employees can have low cost options and savings should go to the employees in tax-free HSAs.
We need more FREEDOM in America William.
The COBRA cost should be about the same as the total employee cost. Evidently state employee benefits are on the plush side.
Barry, Obamacare is killing health insurance for individuals in TEXAS. We know that TIME, United Healthcare, Aetna, Humana and now Scott and White are leaving the TEXAS Obamacare Exchange.
http://healthcare.dmagazine.com/2016/08/17/the-scott-white-health-plan-pulls-its-obamacare-products-from-the-2017-exchanges/
Obamacare is on it’s death bed and the media and the non-taxed think tanks won’t say a word trying to make it to the Presidential Elections so Hillary can be top dog.
Don’t say Obamacare before the election – it’s a secret!
Vote Trump – make America FREE again!
I would say new Hampshire is suffering the same thing as the rest of the country. The politicians are so incompetent they do not understand the difference between Insurance and Bill paying services.
Might as well be called Anthem Bill paying service. the more you utilize the more we make!
I remember the good old days before the ACA. I would sell a family of 4 an HSA plan with a $5,000 out of pocket for about $350 a month. I would feel bad because I couldn’t save them any more money.
Now the same family is over $1200 a month with a $13,000 out of pocket.
someone is making money somewhere.
Lee it’s possible the insurance companies are really raking it in.
On the other hand maybe it’s somebody else. Maybe the insurers are actually losing money. That might explain why United, then Anthem, Aetna and others too have been withdrawing from Obamacare. How plausible is it anyway that insurers would walk away leaving money on the table, after sinking millions in gearing up to support Obamacare?
But maybe they figure, hey we’ve made enough; time to quit.
John, no publicly traded company has ever “made enough” and simply decided it was “time to quit.”
Aetna and United’s withdrawal from ACA marketplaces are very much a sign that the market is not profitable. Of course, without huge government subsidies it was never going to be profitable. That is to say, the design was always seriously flawed.
“John, no publicly traded company has ever “made enough” and simply decided it was “time to quit.”
You’re right. I forgot.
It’s much much worse…companies are not just pulling out of the exchanges . They are pulling out of individual medical! The rubtards should be having a fit and telling the public the demtards destroid the individual health insurance market.
Hillary is to Blaim !!!
I listened a few minutes today to a hysterical talk show host who claimed Aetna was only withdrawing in order to blackmail regulators into approving a merger. Whatever.
It’s not just “someone” making money, Lee. It’s almost everyone in the supply chain of healthcare services. Hospitals, docs, most insurance carriers (those not overly exposed to ACA marketplaces), pharma, DME, revenue cycle management support/consultants, IT vendors, etc. etc. It’s a trough with lots of mouths to feed, and the more government gets involved, the more mouths there are to feed.
This is precisely why I’m stunned that FGA and NCPA would support a policy that actually increases government involvement in health care.
Exactly !!!!
As long as health insurance is subsidized ether by tax credits or employer sponcered . There is nothing the gov can do to make healthcare more affordable.
The ncpa individual tax credit proposal is an improvement over Obamacare but still throws obscenes amounts of $ to the medical community and will not help control costs.
Lee, if the government is using subsidies to soften the blow so that a marketplace can be reintroduced it will most definitely reduce costs. If however, government is using subsidies as an opiod then it is the same game under another name.
I agree
however I am pessimistic about the government reintroducing a marketplace
back in 93 “Hillary said” We can’t afford to have that money go to the private sector. That money has to go to the federal gove4rnment because the federal government will spend that money better than the Private sector will spend it.
The health insurance market will never act like a true insurance market as long as there are tax advantages.
Removing the tax advantages of employer based benefits and turning them into individual tax credits will give consumers more control and can help slow the inflation of medical care.
This would also allow are country to be more competitive in the global economy.
people wonder why we have such a large trade deficit when we are the only country demanding our employers fund health insurance.
Ending the tax advantages of employer health care places an arrow into third party payer which is probably the major cause or one of the major causes for our health system’s failures. The best solution is to end tax deductions for healthcare. The second best solution is to give the tax deduction to everyone, but compared to the best solution that second best solution seems to favor the rich. There are also flat tax credits provided to everyone. Not the best solution, but a solution that significantly moves us in the right direction.
I would add, whatever the tax benefit is, it should be indifferent whether consumer chooses to spend directly on medical services or on premium. We should not have to have an HSA, FSA, or HRA.
Lee you say “As long as health insurance is subsidized ether by tax credits or employer sponcered [there] is nothing the gov can do to make healthcare more affordable.
Assuming by “healthcare” you mean “medical care” I agree completely.
(“Healthcare” is already as nearly cost-free as possible. One can exercise regularly for free; get adequate sleep; quit smoking; not use drugs; cut down on alcohol consumption; choose a healthy diet; drink more water; calm down; drive less like a maniac and use seat belts; get regular checkups and follow your doctor’s advice; etc, etc. No or little cost. But medical care is certainly costly.)
I think the fundamental issue is the difficulty of accessing medical care. I think the chief accessibility obstacle is not inadequate insurance, or high prices. The chief obstacle is the cost of medical care.
If accessibility is the fundamental issue, and if cost is the chief obstacle, then the fundamental Qs are: What factors drive the cost of medical care? How might those factors be changed?
I’m not talking about medical insurance. Insurance is costly because medical care is costly. Any insurance scheme e.g., Obamacare, can limit access to medical care. That’s no solution. Insurance has zero chance to “bend the cost curve” as Americans were deceitfully promised.
I’m also not talking about what physicians or hospitals charge. Those charges are revenues, not medical costs. It’s a mistake to equate the two.
I’m talking about understanding the factors that drive medical delivery costs in the first place – what are the costs for a physician to practice, and for a hospital to operate? What strategies or actions might lessen those costs? Would Americans even want to adopt those strategies or take those actions – once we knew what they were?
Our so-called leadership has avoided these questions for decades and we have what we have today – a non-system that most people consider overpriced, inaccessible, and underdelivering.
What if the public better understood the factors that drive delivery cost? Wouldn’t we be in better position to address those factors? Wouldn’t that offer a better chance of producing rational delivery costs than the present haggling over “insurance” and “prices”?
In 40 years, Moses led his people out of a wilderness. We’ve been lost in our medical system wilderness for more than 50 years – and, in my opinion, we are still avoiding the fundamental questions of ensuring accessibility and figuring out delivery costs. We need a medical Moses. Our government has shown for decades – it ain’t them.
I agree
Maybe either CMS or some well funded think tank or foundation should finance a study that compares the cost of running a typical U.S. academic medical center or acute care community hospital vs. similar hospitals in Germany, France, Switzerland, Canada, Australia, UK, etc. What are the operating costs per licensed bed just to open the doors?
Then compare differences in practice patterns to treat similar conditions. How many more services, tests and procedures are done in the U.S. due to a combination of defensive medicine and a mentality of “that’s the way we do it here?”
Then look at the approach to end of life care in the various countries. Are there differences in the willingness to accept death when the time comes without providing a lot of marginally useful or even futile care? Is there age-based rationing of care in some countries? Is defensive medicine a factor here too?
Then compare the salaries of all the people who work in hospitals from doctors and nurses to housekeepers, food service workers and transporters.
In the end, we might determine that we prefer delivering medical care the way we’ve been delivering it for years but at least we would understand why it costs more in the U.S. If that turns out to be the case, we should pay for it without whining including paying enough in taxes to cover the cost of subsidies for people who can’t afford health insurance on their own.
A lot of contrived work to figure out the actual cost of health care required in the US when all one needs is a free market system where the patient directly pays for his care and insurance. The patient can then determine at what level the trade offs should be based upon his own needs
It’s not just “someone” making money, Lee. It’s almost everyone in the supply chain of healthcare services. Hospitals, docs, most insurance carriers (those not overly exposed to ACA marketplaces), pharma, DME, revenue cycle management support/consultants, IT vendors, etc. etc. It’s a trough with lots of mouths to feed, and the more government gets involved, the more mouths there are to feed. This is precisely why I’m stunned that FGA and NCPA would support a policy that actually increases government involvement in health care. – See more at: http://healthblog.ncpathinktank.org/the-right-to-shop-for-health-care/comment-page-1/#comment-385806
Lee is exactly correct on the premium numbers, because I also sold both then and now.
However — if the family of four has both parents age 45, and in Wisconsin, and an income of $50,000, then their cash premium after subsidies is still about $300 a month.
What has happened to families with higher incomes is just brutal.
This is why I support the Urban Institute proposal to extend premium subsidies to all income levels, and not cut them off at 400% of poverty. This extension might cost about $10 billion a year, which is peanuts in the federal budget and would help a lot of families.
Some of those families will be Republicans too, maybe even a majority of them. The hatred of the ACA and Obama has blinded the Republicans in Congress to their own best interests.
That is unless there employer is heartless enough to deny the spouse and children tax credits. Then they get nothing . The big old goose egg. The big bend me over and ram it home. The lovely sqadush !!!
Lee, Bob makes money on Obamacare so he doesn’t care about the “Hillary Glitch” and how poor Americans get no tax credits PLUS they pay for over-priced Obamacare insurance with after tax dollars.
We need to repeal Obamacare and start over and cap the employee benefits at something reasonable – like $20,000 per year and no more.
The tax code needs some fairness for all Americans and not just those with over-priced and dangerous employer-based plans.
I read recently that only 2% of people with incomes above 400% of the FPL who lack employer coverage or coverage from Medicare buy an ACA exchange plan. Interestingly, that’s the same percentage of people eligible for COBRA coverage who decide to pay for it.
Moreover, only 6% of the remaining uninsured or about 1.7 million people have income in excess of 400% of the FPL. The estimated $10 billion per year cost to remove the subsidy income eligibility limit of 400% of the FPL is probably roughly accurate. We should do it forthwith.
Agreed, Barry, but I think you are missing the persons who make over 400% of poverty but buy an off-exchange plan (since why bother with the exchanges)…..
These families are getting royally hosed. I do not know their number, but this is who I want to help.
Going to Barry’s longer post about really finding out why American health care costs so much:
One reason we are paralyzed to do much of anything about high costs is that high costs have so many beneficiaries! Medicine has been (in most studies) the greatest source of new high paying jobs in the American economy for the past 20 years. (see Michael Mandel on this subject)
One can certainly argue that this is a zero-sum game for the nation…i.e the doctors and nurses and drug company execs and paramedics and medical school professors make higher salaries, but millions of workers in the non-medical fields either have flat salaries (because of health insurance costs) or no jobs at all if their industry shrinks.
Even if we did have a concerted effort to slash medical costs, this effort might create a massive recession. Check out all the late model cars in the employee parking lot at the hospital. That is a lot of car sales that would not happen with serious cost cutting.
Bob – Suppose there are five or six hospitals serving the area around where you live and assume the local economy is growing about in line with the national average of maybe a bit faster. If some or all of these hospitals can figure out a number of different ways to deliver healthcare more efficiently, they may then be able to serve a larger population than they could before and could potentially avoid making millions of dollars in future capital investments to support growth. Nobody needs to be laid off though fewer people would have to be hired in the future to support growth and replace those who retire or leave.
From what I’ve read, there are now approximately 16 million people working in the healthcare field in the U.S. including over five million who work in hospitals. Many hospitals have closed over the years and the number of inpatient beds per 1,000 people continues to shrink. It’s now down to 2.9 compared to 10.0 shortly after World War II and the long term trend is down as more procedures can be done on an outpatient basis, inpatient procedures have faster recovery times and better drugs and healthier lifestyles keep more people out of the hospital in the first place.
We don’t need to drive our healthcare spending from its current level of 18% of GDP down to the 10%-12% range that exists in most of Western Europe and Canada. If we could stabilize it at its current level or shrink it a little bit, that would be a big deal, especially for federal spending over the long term and the scary unfunded liability numbers we keep hearing about would shrink dramatically as well. If healthcare costs stabilize relative to the size of the economy, there would be more room for wages to grow and for people to spend more money on other worthwhile priorities or to save for retirement or their kids’ college education. I don’t think it’s a zero sum game at all.
Bob, it is not a zero sum game as Barry has pointed out. I want to add that along with the expenditures you note it is very much a matter of how the resources are spent that counts;
Our capital and human capital have not been well spent in the healthcare sector. If we did the same in other sectors we would be a third rate economic power.