Aetna to exit California's individual insurance market

Both the Wall Street Journal and Reuters reported Friday that Aetna will exit the California individual-insurance market at the end of 2013.

According to Aetna, this decision "will affect only 49,000 of its 1.5 million policyholders in the state."

Although Aetna declined to say why it is taking this action,  it's likely that the reason is California's health exchange rules.  According to Reuters the California Exchange rules apply to all health insurance products sold to individuals in the state, "whether or not they are offered through the exchange."  

Thus any company that decides after analysis that it's not worth the cost for it to participate in the California Exchange, can only avoid that cost by exiting the market  - as Aetna has decided to do.  

Preview the Georgia Insurance Exchange

To study the likely costs of plans on the Georgia insurance exchange, the AJC selected one proposed plan from the gold, silver and bronze tiers offered by Blue Cross and Blue Shield of Georgia. (Seven companies applied to sell insurance on the Georgia insurance exchange, but these examples are limited to selected plans

on Blue Cross’ filing.) Note that insurers may offer more than one plan within each “metal tier” with co-payments and deductibles that will vary. Here is the cost-sharing information related to the selected plans:

• Gold plan: $750 deductible, 0 percent coinsurance
• Silver plan: $2,000 deductible, 20 percent coinsurance
• Bronze plan: $6,300 deductible, 0 percent coinsurance

The prices, which are premiums per month, assume that the consumer lives in metro Atlanta and is a nonsmoker.

CONSUMER PROFILE: Husband is 32, wife is 30, 1-year-old daughter (2013 rates)

• Gold: $1,024    (N/A)
• Silver: $771    ($423)
• Bronze:$580    ($345 )

Subsidy examples

Income: $20,000 (just above the poverty line). The family would be expected to pay $400 toward for a silver plan.A subsidy projected at about $8,500 would cover the rest.

Income: $60,000 (about 300 percent of poverty line). Family would be expected to pay $5,700 a year toward a silver plan and could get a subsidy of about $3,200 to cover the rest of the cost.

CONSUMER PROFILE: Husband is 47, wife is 42, kids are 25, 20 and 16  (2013 rates)

• Gold: $1,790    (N/A)
• Silver: $1,348    ($824)
• Bronze: $1,014    ($668)

Income: $28,000 (at poverty line). The family would be expected to pay $560 toward a premium and could get a subsidy of about $15,000 a year to cover the rest of the cost.

Income: $84,000 (300 percent of poverty). Family would be expected to pay about $8,000 a year for a silver plan and could get a subsidy of about $7,600 to cover the rest.

Link to full article

Ain't insurance the greatest thing?

Everyone cashes in.  No one has to pay. 

And what affordable health insurance plan, its hour come round at last,
Slouches towards Washington to be born?

"We have to pass this bill, so that you can . . . "

Today’s Wall Street Journal contains this op-ed piece bySenator Orrin Hatch.

In it, he mentions that the Obamacare tax credits “are both advanceable and refundable”.    In other words, IRS will pay them first and verify the claims for them later, a practice that could be called “pay and pursue.”

I did not know the tax credits are advanceable.  Did you?

So it seems more than three years on after passage of Obamacare, the public is still finding out what is in it.   

And we are continually appalled.

Will this process of Obamacare discovery never end?

Obamacare Misses in Mississippi

Obamacare. The promise of lower premiums, you can keep your plan and your doctor, and more competition which is better for consumers.   

We are gaining on 2014 and so far no indication of those lower premiums.

Many are also finding they won't be able to keep their current plan OR doctor.

But what about increased competition which was supposed to lead to lower prices?

When the state of Mississippi begins offering subsidized health insurance under President Barack Obama's reform law this year, residents will have only one choice - Magnolia Health Plan - a small insurer little known in most of the country.

The Obama administration hoped to attract robust competition in creating the exchanges, and it is counting on millions of Americans without coverage to sign up for these plans in the program's first year.

But the nation's biggest insurers have decided against joining the exchanges on a large scale, professing uncertainty about the roll-out and how much the uninsured would participate. Most are sticking to states where they already sell insurance directly to individuals, leaving at least half a dozen states with only one or two health plans to choose from.

Thomas Reuters

A competition of one.

But Mississippi isn't alone.

A similar scenario is playing out in Alaska, Vermont, Rhode Island and Maine, where one small insurer - typically a regional insurer - will have an equal shot at the market against one larger player. These states, and others like Mississippi where competition has traditionally been slim, are a land grab opportunity for these small companies.

The Obama plan had envisioned competition keeping prices low and drawing the uninsured into the exchanges. 

That's too bad.

Perhaps if the folks who designed this mess actually had any REAL WORLD EXPERIENCE things could have turned out differently.

Clue. Less.

Doctors Behaving Badly

As patients, we have all experienced doctors with a bad bed-side manner: gruff in their discussion with you about your issues, leaving you feeling frustrated and angry after the appointment.  While we have been in a fee-for-service type of payment model, this kind of behavior has been tolerated from both patients and administrators, but as medicine moves to payments based on quality, then bad behavior will no longer be tolerated.  This case from 2011 is used as an example in a recent Kaiser Health News article done in conjunction with the Washington Post:

“At a critical point in a complex abdominal operation, a surgeon was handed a device that didn't work because it had been loaded incorrectly by a surgical technician. Furious that she couldn't use it, the surgeon slammed it down, accidentally breaking the technician's finger. "I felt pushed beyond my limits," recalled the surgeon, who was suspended for two weeks and told to attend an anger management course for doctors.”

Administrators have often had to apologize for bad behavior in physicians - especially surgeons - to both staff and patients:

“For generations, bad behavior by doctors has been explained away as an inevitable product of stress or tacitly accepted by administrators reluctant to take action and risk alienating the medical staff, particularly if the offending doctors generate a lot of revenue.”

Physicians understood that they were in charge; they made the money and if they wanted to behave badly, then they could do so without fear of retribution.

In 2009,  the Joint Commission (the body that accredits hospitals) released new guidelines for addressing disruptive and inappropriate behaviors by medical staff.  The Commission recommends that hospitals develop a zero tolerance for intimidating and/or disruptive behaviors.

Medicine has changed, making such behavior not only unacceptable but reckless.  Medicine is a team effort, mandated by government and a natural occurrence that comes with technology and specialization in the medical field.  If a person has a chronic condition, it is not uncommon to have several physicians involved in the care and treatment of the patient.  As more physicians become involved, then more staff, more facilities and more administrators are also involved. And, of course, more potential for personality conflicts.

Quality initiatives are also becoming more important, as hospitals and other care venues are now required to submit quality outcomes to the federal government not only for the purpose of monitoring care but also designating payments. When a physician mistreats a staff member, that staff member has a recourse through labor law which dictates that employees must work in an environment free from hostility or harassment, which could interfere with their job duties and thus patient outcomes.

Fortunately the days of administrators mollycoddling physicians and telling staff that had been verbally harassed “that is how (s)he is, ignore it and go back to work” are ending.  Once payments are based on quality, these physicians will have to change or risk losing money.

Hey Young Invincible, Can You Afford $6000?

Last week's Ezra Klein interview with Aaron Smith was a doozy. For those who don't know, Mr. Smith is the co-founder of Young Invincibles. The group works to educate and mobilize (their words, not mine) those between 18-34 years of age. For Ezzie it was the same mantra we always hear: rainbows, pots of gold, unicorns, warm and fuzzies, with a whole lot of "free". The reality is much different. Especially for those who are supposed to spread the wealth health risk and enroll in "affordable" insurance.

Much has been said about the so-called Young Invincibles and whether or not they will purchase insurance. A more glaring concern isn't whether they will purchase or what will be subsidized, but rather whether they can afford the high out-of-pocket maximums. Under PPACA the "catastrophic" plan for those 30 and under is alleged to have a deductible of $6000 (or close to it).

The problem for young invincibles isn't insurance premiums, it is their personal finances. Recently there was a post in the Wall Street Journal that showed:

Young people also are likely to have precarious finances and scant savings socked away for emergencies. When asked if they would be able, in one month, to come up with $2,000 for an unexpected expense such as car repairs, 49% of 18-34-year-old respondents said probably not. 

Further, these same invincibles have less discretionary income. Most don't carry insurance because they can't afford the premiums. Paying $100-$150 for the catastrophic plan isn't in the budget. The $20,000-$40,000 they make per year gets completely consumed by rent, car payment, student loans, groceries, cell phone, cable TV, utilities, and cheap beer.

As we approach the deadline of where we are going to force people to buy insurance the biggest question that will remain is: If I have a choice between paying a 1% tax on income OR 3% (minimum) of my income on premiums PLUS a huge out of pocket cost factor should I get sick which one will I choose?

I think you see which way this train is headed.