Discuss the health insurance series

Share your thoughts on this series. Have you, your family or friends been affected by the nation's health insurance crisis? How so? And what should be done to fix things?

Part 1 ran today here.  An excerpt from the piece:

Today, four publicly traded corporations -- WellPoint Inc., UnitedHealth Group, Aetna Inc. and Cigna Corp. -- dominate the market, covering more than 85 million people, or almost half of all Americans with private insurance.

On Wall Street, they showcase their efforts to hold down expenses and maximize shareholder returns by excluding customers likely to need expensive care, including those with chronic diseases such as asthma and diabetes. The companies lobby governments to take over responsibility for their sickest customers so they can reserve the healthiest (and most profitable) for themselves.

Meanwhile, insurance premiums are becoming a heavier burden on employers, many of which say that rising healthcare costs cut into their ability to compete and, in some cases, to survive.

As a result, the percentage of Americans covered by traditional group health insurance has steadily declined. Nearly 46 million have no insurance at all. Medical debt has become a leading cause of personal bankruptcy and a growth business for collection agencies.

Even some top insurance executives agree the system is inefficient and sometimes inhumane.

Read all of Part 1 here.

Photo: Joe Raedle / Getty Images

Comments

[Al in Princeton]

Why can't this country get its act together and cover everybody? Why can't this country stop bankruptcies due to health care expenses? If they can pull this off in Japan, Switzerland, Taiwan, Germany, France, England and who knows how many other places, why can't we pull it together? We are a dysfunctional society run by a government that cares more about a few big businesses than its citizens. Shame on us.

[Lisa Adams]

I'll lose employer coverage in Jan 09 and I'm shopping for an individual policy. The quoted premium was increased by 80% for acid reflux and mild depression - out of reach for me! NO coverage for breast cancer. I can't believe this is legal.

Solution: Allow parents to be covered by their children's group policy at a reasonable cost.

[Candace]

Having been denied health insurance due to mild scoliosis for which I go to a chiropractor for a quick, cheap adjustment--and having had my husband denied due to mild elevated BP--I assure you who believe, oh they would never deny me. They will. For some minor, you-ve-got-to-be kidding reason--you will be denied.

Health insurance companies are only, I repeat--ONLY in it for the quick money they make as my friend who worked at one learned. So flush with funds, that when she and others left the company--auto payments continued to be made in salary to ex-employees.

Best healthcare I ever had--Canada's single-payer system where I was covered for four lovely years. Why can't we have it here? Medicare for all.

[Patrick]

I don't understand the resistance from conservatives over socialized medicine. Nearly all first world industrialized nations, and some 2nd world nations have universal health care. We spend by far more per capita on healthcare than other countries, and yet our infant mortality and life expectancy is not #1.

Everyone is comfortable socializing public education, police, firefighting, and road repair. Why not also tackle healthcare???

[JoeS]

The private insurers are touted by conservatives as having the best system, but they keep down costs by excluding those who need it most. People with low wages or no wages end up treated for free in emergency rooms at greater risk to themselves and greater expense to the hospital, which is passed on to the public. Currently the Social Security, Medicare and Medicaid programs operate with lower administrative cost and at no profit. Perhaps the health insurance crisis exists because it is so profitable to skim money from those most able to afford health care and throw everyone else to the wolves.

[RHSchumann]

A universal insurance program would do away with the need for individual companies to insure their own employees.
Call it socialized medicine, but such a program has been in effect in most European countries for a long time. And it works. It also would eliminate the need for hospitals to treat the uninsured at the expense of those who are insured or pay their bills.

[Pearl Chen]

For profit health insurance companies are like the mafia. When they drop you, you've been whacked.

Universal coverage is the way to go. By law, we have to insure our cars. Is human life less important than a motor vehicle?

[Nancy]

After being covered contunously for more than 25 years by individual and the employer based ins. I was diagnosed with cancer. Made it through that but then 2 yaers later my husband gets high blood pressure . He makes the changes needed to bring it down but it still takes three drugs to keep it under control. We lost our insurance due to employment change 3 years ago. Since we had always been covered we checked 1st into a portibilty policy and for the polcy we had , it would run $2,000 a month. If we raised the deductible the premium to $10,000 a yr. if would have dropped to $1700 a month. The only policy we could get was a major medical with a $20,000 yr deductible and no drug coverage at all. Price was $850 but when you added back in the scripts we both need it came back up to $1400 a month.Not possible to pay on $50,000 a year! After checking with the company's underwritting staff, we applied for a new policy after being told since it had been 6 years that I had been cancer free we could be underwritten,. Not! They did as it states in this article. They turned my husband down due to two conditions, the high BP and heartburn he had f or a few weeks from one of the first drugs they tried him on, a sideaffect. They turned me down stating I too had two conditions, the cancer and back pain which I was treated for before my cancer diagnosis. The back pain had been an early symptom of the cancer and went away after the chemo and radiation. We are both in our mid 50's and are now praying that our health holds till we qualify for medicare. What is really sad is that insurance companies are also treating their own employees almost just as badly. Our yougest daughter works for Cigna in claims resolutions and her company policy is almost as bad as not having coverage at all!

[RJ Scheerer]

McCain’s Health Care Proposal

As an insurance and reinsurance executive, I feel compelled to comment on McCain’s disastrous health care proposal. He proposes to change how healthcare is paid for, or better stated taxed, in our country. Although his proposal does not specifically eliminate companies from providing health insurance to it employees, it is a step in that direction as healthcare premiums would no longer be deductible as such. Instead a company would simply reallocated these cost to its employees as additional taxable income (wages) to the employee. Since wages are deductible, the company remains neutral, but the employee how has to pay income tax on the cost of the health care provided by the employer. This is simply a new tax imposed on all workers. To partially offset this tax, a limited income tax credit is offered. Lets take a look at how this might play out.

1. Anti-selection, Plan Termination, and Increasing Uninsureds.
McCain’s program has a built in anti-selection against the employer plan. Employer group plans have composite or average age premium where as individual plans are price according to each individuals attained age. The younger, healthy employees will probably find that the proposed tax credit maybe more that sufficient to purchase coverage from a individual carrier. Older employees, on the other hand, and those with preexisting conditions would find the opposite. Employees with preexisting conditions would be unable to secure individual coverage. As young employees elect individual plans, the employer plan would be left with the older and less healthy - leading to deficits. These deficits would have to be passed on as increased premiums passing directly to the employees and raising their taxable income. Deficits and premiums would continue to rise as the remaining group becomes older. The insurance industry calls this death spiral insurance as the group plan ultimately becomes to costly to maintain. Termination of the plan would force the older employees into the individual, age rated, market were premiums would be prohibitive and the tax credit insufficient. In addition, since there is no coverage available for unhealthy employee in the individual market, they would have to look state governments for relief.

2. Lack of Carriers and Reinsurers for Individual Plans.
McCain mentions choices and innovative products. These simply do not exist. Since and during the nineties, insurance companies massively withdrew from the individual health insurance market. If one checks with state departments of insurance, you will find that the average is less that ten insurance companies providing individual health insurance in any state. In addition to the lack of insurance companies, almost no reinsurance companies provide coverage to this market at this time.

3. Reduction of regulation.
McCain has stated that the carriers would be encourage to offer plans for national distribution via states were regulation is less comprehensive. This would be states where regulation of benefits are not mandated, lower reserves for claims are acceptable, and where price and administrative costs are not controlled. This would lead to the worst in product development; leading to less benefits for the premium dollar. It would open the insurance industry to the same abuses that currently exist in the banking and credit card industries. Insurance companies have been reducing the benefits, raising premiums, and cherry picking who they insure to increase their corporate profitability.

4. The under-insured problem.
Under-insurance occurs when a plan of insurance does not adequately cover the cost of the claim. It leaves the insured with a huge medical bill even though coverage exists. This simply results from the increasing portion of the medical bills not covered because of deductibles, co-pays and coinsurance provisions. Even people with health insurance are facing bankruptcy as a result of these provisions included in policies by insurance companies to reduce their claims and increase profit. . In addition to deductibles and co-pays on top of coinsurance much of the plans end up only covering catastrophes; but even a catastrophe may not be covered under plans that require prior approval before treatment. Policy holders are finding that physicians and other health care providers will no longer accept insurance coverage from some of the abusing carriers. There is nothing in McCain’s plan does not address the problem of under-insurance and reducing regulation would increase the problem.

5. Substantial Increase in National Insurance Costs.
Individual plans offered by insurance companies are substantially more expensive than group coverage. The percent of premium going to administrative costs on individual plans is in the range of twenty to thirty percent whereas group plans have six to ten percent administration costs. Single payer or national health programs of other countries have costs as low as three percent. McCain’s plan based on the private industry model of individual policies is the lease efficient method of providing health care in existence. In addition, the huge cost of providing coverage for the less healthy would fall upon the states at a time when state budgets are already in trouble.

6. Simple Math of Tax Credits.
McCain returns to the same old “tax credit” concept favored by Republicans that works to the disadvantage of low income groups. For a tax credit to be meaningful, one needs sufficient income and a tax liability. The full $5,000 family credit proposed would only apply to a family of four with income totaling or exceeding $73,000. Since families below that income level do not pay taxes in excess of $5,000, the credit becomes less and less meaningful. Insurance premiums are not based on income; and as we drop down in income levels, the ability to pay insurance premiums decreases dramatically. (Math = total income @ $73,000, less exemptions of $13,200, less standard deduction of $10,300 = taxable income of $49,500 which calculates to $5,017 taxes).

7. End of Employer Provide Group Health Plans.
Although companies would remain neutral as to deducting medical insurance expenses, health insurance costs stand out like wages. There is every reason to believe that employers, to reduce their expenses, will terminate group plans now that employees have a government credit to purchase coverage in the marketplace. Reducing or eliminating insurance costs is no different than reducing wages by downsizing. This will be the most revolutionary effect of McCain’s plan. It would eliminate the need of employers to provide coverage. Employers could get out from under health plans with no tax consequence whatsoever to offset the governments tax credits.

8. Deficit and Debt Increasing Program.
Healthcare is a large percentage of the gross domestic product of the United States. It would be irresponsible tax policy to provide the tax credits with out offsetting tax revenue. McCain’s health care will expand the debt of the U.S. immensely. A questionable policy considering the current economic problems facing our Federal Government today. We can borrow our way out of a health care crisis.

In conclusion, McCain’s plan is simply the worst possible solution to the increasing problem of providing for rising insurance costs, reduction in coverage, increasing numbers of uninsured, and community health in general. It is in our best interest to provide a comprehensive health care program for all citizens. Inadequate community health care spreads infectious disease. At least 15% of the people around you are now uninsured. Most probably do not have sufficient funds to seek medical treatment. They may be your servers; leaving you only one cough away from joining the infected. When your doctor informs you that you have a form of incurable tuberculosis, who will you blame.

RJ Scheerer, Pres.
Intermediaries Plus, Ltd.
(reinsurance intermediaries)

[Mrs. Russell]

My husband has asthma, I have rapidly-growing thyroid nodules that have not be biopsied among other 'minor' conditions. We tried the individual market but I was denied and he had a "rate-up" of 50% that made insurance unaffordable for now. I have thought about not disclosing my thyroid condition, but the main reason I need insurance is for my thyroid medication and a scan every 6 months to track the growth, so I know a costly retroactive cancellation is likely.

While we save for my husband's policy, he is trying to eliminate his dependency on Advair. We anxiously treat every episode/attack at home, praying he doesn't require a shot or emergency care: an agent told us he'd likely be uninsurable if he did.

My husband is self-employed, but I am looking for a job and hope to provide group coverage for both of us. But what about when we start a family? We have two options: I must be a working mom so we can continue to have benefits, or my husband can reduce his income until we qualify for Medi-Cal. It hurts my pride to rely on government welfare, but I'm not going to take a pass on being a quality mother simply because I cannot get single-payer insurance.

[richard schumacher]

We now have universal health care for banks. When do we get it for people?

It's time to lower the Medicare eligibility age to zero.

[Kevin S]

Slate had an article like this a while ago which pretty much stated that insurance companies became too good at accessing risk that the insurance stopped doing what it was supposed to do: spread the risk out amongst a group of people. This is another case of institutionalized welfare (like the bank bailout) for the upper class and corporations. They profit on the healthy people, we (taxpayers) pay for the money losers they refuse to insure.

[Mathew Andresen]

I think we must either move towards individual mandates, or a single payer. I favor a single payer system combined with incentives for a healthy lifestyle.

For example, if you were healthy you might get a prebate each month that covered part of the savings that were generated by the system. Thus restoring the financial link between healthy living, and healthcare costs.

[Anne W.]

An elderly woman I know was complaining that her husband's medical expenses had put them in the so-called "doughnut hole" for Medicare. Thus, they had to get his prescriptions from the VA, which was less convenient.

I commented that it is a shame we don't have healthcare for everyone in this country. She was startled and upset by my remark.

"That would be SOCIALIZED MEDICINE!" she said.

What she thinks Medicare and the VA are, if not a form of socialized medicine, I do not know. And I didn't ask.

[Dan]

We just spent 700+ billions in bailing out wall street (socialism for the rich) so they can maintain their lavish lifestyles but the working class can't even afford health insurance and are being stuck with the bill for the bailout. 700 billion is more than enough to provide health insurance to EVERY AMERICAN and then some, and would boost the competiveness of american industry since they will not be burdened with huge healthcare costs. Government for the people, by the people??? think again.

[jim jaffe]

while one could come up with an individual health insurance system with the type of protections you find in the auto, homeowners and life markets, no one has. that's partly because the market is so small and serves few people with any political clout. it is basically tangential to the big problem, never having reached more than 7 percent of the insured population (a number that hasn't jumped despite employer cutbacks).

this doesn't necessarily prove that those in the McCain camp are wrong about the possibilities of the individual market. but it does prove that market is dysfunctional at the moment and thus unready for the prime time role they promote for it.

[Bill G]

Privately held health insurance coporations FOR PROFIT are the product of a morally BANKRUPT culture. That insurance companies are ALLOWED to make money off of people's health is utterly detestable and morally indefensible.

[gary]

I beleive the first step to solving the health care crisis is to 'VOTE THEM ALL OUT', (state and federal)....good or bad...democrat or republican.

This is the 'ONLY WAY' Americans will ever send a message to the politicians that we want change and action .....for the benefit of American citizens.

Four years from now, whoever wants to, can go back to playing republican and democrat, and by then they will have gotten the message!....or we will do it again.....seems pretty simple to me.

[Robert]

Healtcare insurance premiums will never come down until large, public companies, which must show ever increasing profits to influence their stock price, are out of the business of paying claims.

I work for a healthcare provider. For past several years, payments to doctors and other entities have actually declined yet premiums have increased about 7% per year.

Either our legislators don't understand how the payment system works or Wellpoint and the other big insurers have so much influence over them that they are never mentioned.

It is healthcare premiums that are rising, not the cost of providing the care.

[Keith]

It’s a shame we’re being taken for such suckers under the guise we’re better off fending for ourselves in the private insurance market instead of forming public or highly regulated insurance pools you see in other countries. The amount of money siphoned off for corporate expenses and profit is staggering and shameful. Governor Wilson tried to privatize State Fund, but the business community blocked him because they knew it was crazy to divert large portions of our worker’s compensation premiums to private gain rather than health services.

Harry Truman and Earl Warren proposed public insurance more than 50 years ago. They knew public insurance was vital to our nation’s health like public schools. The insurance industry coined ‘socialized medicine’ during the Communist witch hunts to turn public opinion against Truman and Warren. Truman and Warren knew proposals that simply expanded our pool of welfare recipients or that force individuals to shoulder the financial cost of health care was bad economic and health policy then like it is today.

[smi2le]

If we have money to fund the occupation of Iraq, bailout banks, give away to Israel and agribussiness and to give tax cuts to the rich, surely we have the money to provide all Americans with basic medical care, especially since we are now spending twice as much as other countries with national health insurance and rank 39th in quality of our health care.

GO to HEALTH CARE FOR ALL. This is the coalition of physicians, unions and religious leaders who support national health insurance NOW.

[Pamela Coker]

Work in a pharmacy some time. It's all about greed - between the pharmaceutical companies and the insurance companies, no one else matters. The person who needs the prescription(s) is the last one to be ever considererd. And to the joy of all of us, pharmaceutical companies are investing next to nothing in research, but the bulk of their profits is going into advertising. Watch the tube anytime!

[Doug]

Dan, I don't think you realize the size of the problem. $700 billion is less than the ANNUAL budget of Health and Human Services ($747 billion) of which $420 billion is for medicare alone. So you can see that that $700 billion won't go too far when you're talking about covering all Americans.

[mark oconnell]

I am self-employed and not as well off as "Joe the plumber" who apparently makes over $250k a year. I can't find any choices in health coverage for my wife and I who are in our mid fifties. We have had a Blue Cross PPO since 1984 and the monthly premium has risen to over $1000 per month with a $5000 deductible. Our live-at-home 22 year old son who cant afford to move out also has a $5000 deductible.
This means that I have to pay over $12000 a year and up to $15000 a year additional in duductibles before Blue Cross pays a dime.( $27,000 )..
This doesnt cover dental or vision expenses either.
I recently had to go to Hoag hospital after hours for some symptoms that turned out to be minor but mimicked a heart attack for which we are told to seek immediate medical attention.
I was there about 2 hours total most of which time was spent waiting for some blood tests, an EKG and a chest x-ray. Since I avoid seeking medical treatment because of the crishing cost, I have not met my deductible yet this year so I am on my own to deal with a Hoag bill for $2,200.00 which is outrageous.
I will pay the REASONABLE value of this service but how do I fight the hospital billing department who presents me with these imaginary numbers?
I am paying for all the uninsured people and for the Taj Mahal hospital waste and bloated bureaucracy and corporate perks.
How can I fight this and pay only a fair amount?

[Sue Anne]

The American "resistance' to basic universal coverage crosses party lines and political orientations. I think it's grounded in an incessant cultural preoccupation with choice, regardless of the quality of those choices.
Choosing between gas, medication and food is not a choice.

Anyone who's lived in a society with universal care, gets the difference in societal quality of life and how that affects individuals. It's unfathomable to them and to me, that a person who's ill actually is denied healthcare. It's inhuman and burdens everyone.

We spend 200k to keep a premature baby alive and keep people alive way longer than we need to with expensive bio-technologies. Why? Let it go.

There is no direct correlation between high cholesterol and heart attacks and the research on cholesterol drugs is market driven.

It's utterly amazing all the pharmaceuticals that have come into existence in the last 15 years and all the illnesses that exist that didn't before.

Hmmm? Something's amiss...

A worthy read: Foucault's Birth of the Clinic