It has been a very long time since I have written a blog post on healthcare reform.  I have found the fallout from healthcare reform to be so overwhelmingly non logical that I just got tired of complaining. 

• Long Term Care, a key component in passing healthcare reform in 2010,  that's ...

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Perhaps by morning there will be articles out there with some quick stats on the things you might want to know. I thought I would put out a few of the stats to start. Can I get insurance without a pre-ex clause??- Not until 2014. High Risk pools ? - Federal government will fund $5 billion for high risk pools. Should kick in 2010. Kids ? - To age 26 in all States. Should kick in 2010. Did my taxes go up? - Payroll tax will increase in 2010 for those earning over $200k. Income tax surcharge of 3.8%. Did my Health Savings Account survive? - Yes. What about employer penalties who don't provide insurance - For qualified employers, the penalty has been increased from $750 to $2000 per employee. What about individual penalties? - If you don't have insurance, you will pay 2% income tax surcharge up to $325 per person. What about Expensive health plans surtax? - Exists, $10,200 for singles, $27,500 for families. Flex Spending Accounts - $2500 annual contribution limit. Deduction of Medical Expenses - Increase from 7.5% of AGI to 10% excluded. Creation of Long Term Care insurance fund for to help seniors in need of help with daily tasks such as bathing and dressing. No gender based pricing for individual insurance. No lifetime limits on benefits. $480 billion in new taxes over the next 10 years. $500 billion in Medicare cuts over the next 10 years. << MORE >>

I am monumentally disappointed in the passing of this Health Care Reform bill. Most of the people reading this blog will pay substantially more for the same services so that those who did not pay into the system have guaranteed access. This bill will surely be modified thousands of times over the next 5 years, but one thing is certain; costs will increase. Imagine a surcharge on your mortgage to make sure that those who over extended don't lose their home equity. I am 100% open to being wrong. I made a huge mistake in voting for a Presidential candidate who promised openness and bipartisanship in formulating a health care bill. I am hopeful that my losing streak continues. For now, I am as disappointed in Congress as I was excited when Mr. Obama was elected. << MORE >>

Update: On March 2, 2010, Congress passed, and the President signed a 2nd extension of the COBRA subsidy. The subsidy qualification period has been extended to December 31, 2010. President Signs COBRA Subsidy Extension Legislation Extends the premium subsidy eligibility period by two months, so it will end on February 28, 2010, rather than December 31, 2009. Extends the period of the 65 percent COBRA subsidy from nine months to 15 months. Establishes a transition period that applies to individuals who lost subsidies before the effective date of the Act because they received the maximum number of months of subsidies under the original subsidy provisions. Establishes new notification requirements by group health plans or other entities. Clarifies that eligibility and notice requirements for the subsidy are based on eligibility for COBRA due to loss of coverage because of qualifying event (involuntary termination of employment), both of which must occur during the eligibility period. Becomes effective as if included in the original COBRA subsidy provisions of the American Recovery and Reinvestment Act (ARRA). << MORE >>

What I believe will be in the bill. No Cost Containment Some disincentive for those that try and beat the system, but not enough to change the economic decision of the individual to choose to try and beat the system. $50 billion in new taxes to be passed on to the consumer. No reward for staying insured. No incentive to obtain lower cost care. Elimination of Pre-ex. No change on provider discounts. A health insurance exchange to create new competition, but most likely won’t be competitive. “To heck with fraud”, lets just cut everybody. (sarcasm) – The government can’t seem to manage fraud, or even mount an attempt. They just will build in the basis that everybody cheats them, so cut everybody. << MORE >>

At 11:00pm Eastern Time,  the House of Representatives passed sweeping health care reform legislation with HB3962.   The vote was  ,  with    Democrats voting against Health Care reform.  

The bill, over 2000 pages, includes a Public Option.  An amendment passed tonight that banned Abortion coverage being included with any Public Option or private plan where federal subsidies are involved.  Rep. Jan Schakowski argued vehemently for abortion funding , but was unsuccessful in getting that ...<< MORE >>

The coming health reform bill, (please pardon my reference to this bill as being related to actual health reform) is going to garner the support of AARP.    I felt the need to vent on my opinion as to why.

Health insurance and health care is a very tricky and confusing subject.  Let me admit publically, if I haven’t before, I wouldn’t have a career if health insurance was easy.   One might argue that my bias would be to promote my own agenda.   I respect that potential conflict and have never taken issue with anyone questioning my ethics.   I purposely steer clear of any opinion on subjects that would impact, either positively or negatively, my income.   That said, other special interest groups do not appear to be as noble.   Thus, the subject of today’s blog post, those good folks at AARP.  

AARP is a special interest group with interests in Media, Insurance, and Financial products. AARP is  bigger than most regional health insurance companies  and has the largest circulation of any magazine.    They don’t represent themselves as a magazine company like TIME, an Insurance company like Aetna or United Healthcare, A mutual fund company like Fidelity, or even a federally funded private company .   Yet they are all of these.   Their public policy, allegedly representing the wholesome interests of seniors, is really just another marketing group profiteering off the backs of seniors.  Business week Magazine wrote in 2005 that their products are typically not scrutinized for cost and quality.  

AARP public policy has consistently stood on the side of issues that increase its revenue and profit.   Over the past 10 years, AARP has increased their insurance revenues by several hundred percent.   They did so by branding and associating their name with insurance products from United Healthcare and Aetna.   When Medicare Part D – the  Rx Drug part of social security, they were obviously advocates for the program, but were also positioned to add hundreds of millions of dollars in revenue to their income statement, per yet. They did, and good for them too!   They are a very successful business and they continue to brand themselves in ways to increase revenue and profitability.     What AARP is not, is a social conscience.  Much like a Union tries to negotiate on behalf of its members for the most possible without being concerned for the profitability of the owners, AARP lobby’s for interests that are good for their own bottom line.  

One of the main arguments from insurance companies, and against this reform bill, is the level of benefit funding for Medicare Advantage Plan members .   The insurance companies were not only criticized for telling their members that Government cuts would result in benefit cuts,   HHS actually issued a gag-order preventing insurance carriers from disseminating that information to its members.   It was seen as a conflict of interest with questionable conclusions. 

Those who have Medicare Advantage plans, have no need for a Medicare Supplement.  Thus millions of seniors who took Medicare Advantage coverage from insurance companies, do not need or buy a Medicare Supplement from AARP.   “Coincidentally”, those  millions of seniors who get Medicare Advantage  benefits from insurance companies, and who’s benefits stand to be cut significantly with this reform bill, don’t appear to be represented in AARP policy papers.  Not one single article from AARP this year on the negative impact from the health bills.   If Medicare Advantage benefits are cut, the prospect of millions of seniors abandoning this coverage will then need a Medicare Supplement.   Hey!!! AARP sells that !!!  

Medicare.gov, a government website describes Medicare Advantage plans as “They generally offer extra benefits, and many include prescription drug coverage”.  So  why doesn’t AARP care about these seniors?   It seems easier to understand if you consider that AARP is not a social conscience, but a financial services and insurance company.

If you assume that I might have a bias, I would also assume that a company whose royalties tripled after Medicare Part D passed, and who would stand to increase revenues by as much as $400 million per year if the House Health care bill is made law, might have a biased opinion. 

AARP is disingenuous and their endorsement of the House Bill is self serving.  Shame on AARP.      

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I started this blog this past summer to promote intelligent discussion about health care reform issues and points.   Over the past couple of months health care reform, as crafted by the Democratic party, has degraded into nothing more than an assault on anyone that has the money to pay more taxes.    Those that object, or raise arguments against legislation are targeted with tags of villianization, taxes, surcharges or all of the above.  

In September, Health insurers were issued gag orders forbidding them from communicating objections to legislation.  When the Public option, which I call the “pay the government instead option” was met with resistance by seniors and providers, legislation to cut $500 billion in Medicare benefits and providers was introduced.    For those providing insurance, medical equipment or services, $40 billion a year in new taxes starting in 2010.   (Guess who really pays?  The consumer)  The argument that legislation will cut the deficit by $80 billion is advertised,  the fact that there are $1 trillion in new taxes is trivialized.

This week I received a copy of letter from the head of the CBO to Senator Max Baucus, dated 10/30/09.  It contains this little blurb:

 That is, CBO has not evaluated whether reform proposals would lower or raise—or bend down or up the “curve” of national health expenditures. Finally, the question of what impact proposals might have on health insurance premiums is also of considerable interest. CBO intends to address that issue in the near future.

 

Really?   We are going to have $1 trillion in new taxes and the CBO never looked at if health care expenses will go down?   Does Washington think this is a Halloween prank?

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The number of updates to my Blog has dwindled over the past couple of weeks.  The Truth is that I just can’t keep up with the silliness from D.C.  

·         11% of Federal Employees entitled to the same medical plan that Congress and the President have, are uninsured.    Can’t afford it. 

 

·         The much maligned October 2009 study from PriceWaterhouse showing that the impact of health insurance costs if the bill passes, for a family, rising $4,000 more than if the legislation was not passed has caused trouble for the industry.   I agree that the study was overkill and not without questionable assumptions.   What I know is not overkill.  Without gender based pricing, which will no longer be allowed,  and with maternity benefits mandatory,  a 29 year old male in Chicago will instantly see his premium go, for a $500 deductible plan from a current $197 to more than $325 per month.   That assumes no inflation, no change in reimbursement rates to doctors, stable premiums, and a 15% discount for everyone having the benefits.   

·         Hay Dare!   The Canadian System - 

o   In 2005, the Supreme Court of Canada struck down the ban on Private Insurance stating “"Access to a waiting list is not access to health care,".  I Suspect that any health care reform in the US will give you guaranteed access to a waiting list. 

o   In 2006, the national health policy goal, of 75% of those needing bypass surgeries. getting the operation within 180 days of diagnosis, was not even met by two provinces.  

o   Here’s an interesting Canadian Company. http://www.timelymedical.ca/about-us.html.  Why do they exist and can I get a US franchise?

o   The Code word to get an MRI in Canada is “Meow”.   See this Sept 2009 story from ABC’s 20/20 on YouTube.   

·         Medicare Advantage Plans - This is when seniors opt out of Medicare to take a private insurance plan that gives them all the benefits of Medicare plus additional benefits like drugs, dental, vision and hearing benefits.   A senior on “Medicare Advantage” Plans pays little or no premium to the insurer.  They don’t pay the $97 for Medicare Part B, they don’t pay the $125-250 for a Medicare Supplement.   These plans cost the government 14% more than straight Medicare.   That 14% will be cut, and benefits to those members will be cut.    It saves the government $100 billion over ten years, but it will result in those least able having to pay as much as $300-$400 month extra to replace those benefits.    

 

·         Cut the Deficit by $81 Billion says the CBO - What I don’t understand is why $900 Billion in new taxes, higher medical premiums to the public, and $500 billion in Medicare Cuts don’t result in $1.4 Trillion in deficit reduction.   How about we just cut $500 billion from Medicare and cut the deficit by $500 billion.   If that was doable, it would be done.  It’s not.   The $81 billion assumption assumes that in 2011, Medicare reimbursement rates will be reduced by nearly 26%, and that those reductions will stick, year after year.  Uh-Huh! 

 

·         Reasonable People will cancel their health Insurance December 31, 2012.   Get your letters ready.   

o   The president of the National Association of Health Underwriters, an organization representing more than 100,000 health insurance agents, on October 14^th, 2009 told his audience that costs for insurance will rise at a greater rate than without legislation.   He also told that audience that he believes that reasonable people will continue to have health insurance after reform legislation.   I agree that that costs will rise.   I do not agree that reasonable people will retain health insurance.  

o   Assuming you pay for your own insurance, and currently pay about $15,000 per year in premium, why would you continue to pay for insurance?   If you don’t have insurance, you will pay a $600 fine, maybe.  (Maybe because the excise tax is only collectable on tax refunds and they will not accrue penalties or interest).  If you need insurance, you can get it, ON DEMAND, without a preexisting condition clause.   Hmmm… Spend $15,000 even if I don’t need it, or a $600 tax…. When I need it, I am guaranteed to get it.  Well, I must have missed the continuing education course that says “reasonable people” is synonymous for “sucker” in insurance-eze.

·         Health Insurance executives limited compensation.  The new health care bill will include a provision that limits the tax deductibility of wages for health insurance executives from earning more than $500,000 per year.   And who can blame Washington for that?  After all wasn’t it the health insurers that took $700 billion in bailout money?  Wait, that was banking.   Or was it that they went bankrupt and the government had to subsidize a Cash for Klutzes program?   No… not them either… Well it must be that they are responsible for the mortgage mess?   High interest rates?  Soaring oil prices?  Gotta be something right?      In a related story, the average Major League Baseball player salary rose to over $3,000,000 this year.   

 

Well at least insurance agents will exist - In early bills; Insurance agents will be replaced by Government “Navigators”.   No it’s not a big Lincoln SUV.   It’s the term for the new 800 number outsourced to lots of “BOB’s and SUE’s” to help you with your insurance options.  That provision looks like it’s out of the current bills.   At least people like me will be here for a while to help you send in your cancellation letters to the insurance company.   (But not until 12/31/2012!)

Look for the "Public Option" to again gain traction in the next few weeks.

 

 

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