Free health care should come with a price

I am not conservative. I am not liberal. I am pragmatic.
I care less about the political theory and more about the bottom line.
The pragmatic side of me, the one that pays taxes and worries about the direction of my country, is troubled by what is missing in the debate over healthcare reform.
Personal responsibility. That is what is missing.
As the federal government prepares to implement a $1.6 trillion overhaul and mandate more invasive regulation of small business, isn’t it time we dealt with one of the primary causes of the problem?
Specifically, we are an unhealthy nation.
Yes, some of us lose the wellness lottery and incur diseases and conditions through no action of our own.
But many others, frankly, invite poor health through their own actions. Overeating, smoking, drinking, lack of exercise, even excessive tanning. We treat our bodies without regard for the consequences. Vanity and gratification have replaced responsibility.
It is unfortunate and even sad. But now, it also is more costly to those of us paying taxes. As the government picks up the tab for the predictable consequences for these poor choices, taxpayers will be footing the bill.
If we are really going to reform healthcare in a meaningful way, we are sending exactly the wrong signal. We are effectively saying “go ahead without regard to the economic consequences, we will pick up the tab.”
It is time that personal responsibility took center stage. Or, at least, personal consequences.
We need to encourage wellness with both a carrot and a stick. Reward those with healthy lifestyles and economically penalize those who make unhealthy choices.
Specifically, more properly reflect the cost of choices for those receiving taxpayer subsidies. In economic terms, internalize the external costs. If you smoke, you will be taxed or your benefit reduced. Same with other unhealthy lifestyle choices.
The result? A more robust healthcare system and a healthier population.
Now, having raised this suggestion, I have little doubt that it will be seen as too intrusive. It should not be. People can smoke. People can tan. People can eat themselves silly. The choices are still there. But make them take personal and economic responsibility for those choices. Free health care should not be one sided. Expectations can and should be placed on those receiving the benefit.
After all, if we really want to reform healthcare, it is time we looked inwardly at what makes us unhealthy to begin with.
Let’s address the real problem here, not simply throw money at the result.

Something is missing here

As the pundits and politicians debate and decipher runaway health care costs and how to control them while providing better coverage for all, there is curiously little talk about one of the key inputs.
Where is tort reform? You remember the problem, the issue of random runaway jury verdicts that disproportionately drive up medical malpractice–and ultimately consumer–costs. Why is that not squarely on radar screens?
It should be.
A confession: I am an attorney.
A more revealing confession: The medical malpractice system is still in desperate need of change and no healthcare reform is complete without addressing it.
Do not get me wrong. Doctors are sometimes negligent (just like lawyers, plumbers and taxicab drivers) and should be financially responsible when they fail to meet the standard of care for their profession.
But that is not what happens today in any comprehensible manner.
Instead, only five percent of claims ultimately go to trial. Of those, 80 percent result in verdicts for the defense (the medical professional) and less than 1 percent end with a monetary judgment for the plaintiff.
The problem is the cumbersome, inefficient and often self-serving (as in the case of lawyers) process that can drag on for years. In this case, time is literally money. As the litigation process unfolds, the clock is ticking and health care costs rise.
States have taken the lead in dealing with this inefficient and often unfair system by creating review panels and even considering “no-fault” systems, where it is the outcome that defines the compensation.
Congress has utterly failed.
That is unfortunate.
Comprehensive healthcare reform can only occur if tort reform is addressed as well.
Something is missing here.

I am part of the problem

Forgive me, for I have health care costs.

Yes, I am part of the problem. Perhaps you are too.

As we continue to point the finger at insurance companies, doctors, hospitals and even government, perhaps it is time to look in the mirror.

The health care crisis has many instigators, and I am one of them.

As a small business owneer, I pay a monthly premium for family coverage that is unfathomable to many. $1000? Ha, it was a decade ago. $2000? Not even warm. $3000? Those were the good old days. No, I pay $3900 a month for coverage. Imagine that, $46,800 of my business profits go to pay my health insurance premiums. Simply incredible, right? Indeed, I could probably get my story on a news show.

But there is another part of the story. And that is, despite sky-high premiums, I cannot go elsewhere for coverage. The reason is simple. My insurer loses money on me. I have a child with multiple serious physical and mental disorders. The price to keep her healthy dwarfs my premium. In fact, last year alone, my child alone rang up $76,000 in health care costs.

I suspect I am not alone. Whether it is the uninsured visiting the ER for basic care or others with chronic conditions, health care costs a lot. And the premiums we pay for coverage do not always the way.

This is not to cast aspersions, but rather to recognize a major part of the health care dilemma.

While it is easy to point fingers, we will only truly move forward toward lasting solutions when health care consumers recognize that part of problems rest with each of us.

Let me start. I am part of the problem.

A critical moment

We are at that moment, that moment of perceived crisis and consequence that seems to pervade public policy debates. Healthcare reform is not immune.

Indeed, things are ratcheted up a notch. On the one hand, the Obama Administration is pushing for quick passage. “Seize the opportunity” for reform now, the President told Congress and repeated in his weekly radio address.

On the other, just what we are “seizing” is far from clear. Details remain fuzzy as the 1000-page House Bill is digested. The most obvious analysis reveals that taxes will go up to pay, raising the top federal/marginal rate to a whooping 52%.

More troubling is the assessment of the Congressional Budget Office, which opined that the plan grows, rather than shrinks, healthcare costs, and does so at an unsustainable rate. If correct, those who advocate quick passage are “seizing” a plan that is broken from the start.

Yes, this is a critical moment and healthcare reform is a laudable goal. But the pressure to rush to resolution is unwise and possibly harmful to consumers.

America needs a healthcare system that is efficient, affordable and sustainable. At Congress continues to debate the merits of the Administration proposal, it is clear that we are not there yet.

When choice is no choice

Think that health care reform is going to give you choices in insurance coverage? If you are already covered by an employer-sponsored plan, think again.

A news today report suggests:

“President Obama and leading Democrats have stressed that people who like their employer-sponsored insurance would be able to keep it, under a health care overhaul. But they haven’t emphasized the flip side: That people who don’t like their coverage might have to keep it,” Kaiser Health News reports. “Under the main health bills being debated in Congress, many people with job-based insurance could find it difficult to impossible to switch to health plans on a new insurance exchange, even if the plans there were cheaper or offered better coverage. The restrictions extend to any government-run plan, which would be offered on the exchange.” But “there are a few exceptions: Workers would be allowed to buy insurance through the exchange if their job-based coverage gobbled up too much of their incomes or was too skimpy. Also, under the House proposal, people could get insurance through the exchange if they paid their entire premiums – a cost that would be prohibitive for many workers.”

What does that mean? Simply, that reform, however cast, will cut a number of ways. Consumers will be affected by whatever is passed in a number of different manners. For some, that may not be as rosy as it first appears. It very much depends on where you sit.

It is has long been said all politics are local. Now, we also know that the impact of healthcare reform is local too.

Too good to ignore

Sometimes, an idea is so good and its merit so obvious that it cannot be ignored.

That is the case with the Patient Care advocacy program offered to all policyholders by Assurant.

The only program of its kind, Patient Care bridges the gaps in an often foreign and unforgiving health insurance maze.

As reported:
Patient Care is automatically available to customers with qualifying plans and requires no additional paperwork by the agent. Patient Care advocates are experienced health insurance professionals who also can assist customers by:

•Explaining health care bills, claims and benefits
•Answering questions about HSAs and how to use them
•Resolving issues regarding claims or billing
•Identifying lower-cost drug options
•Handling all of the necessary pre-authorization approvals.

It is commendable that Assurant has this problem. It is even more perplexing that others do not.

In the interest of full disclosure, Assurant provides support for this site and our efforts to educate consumers about health insurance.

Normally, that would cause me to shy away from this topic, at the risk of appearing to be a cheerleader.

But some topics, like the Patient Care program, are simply too good to ignore.

Do not confuse me with the facts

When it comes to the healthcare debate, facts sometimes get lost in the rhetoric. Even more troubling, the rhetoric becomes fact.

Such is the case with a plan to introduce an automatic long-term care program, which policymakers count as a money-saver in a less-than-candid manner.

As the Washington Post reports:

A new gimmick has been designed to pretend that health reform is fully paid for. The Senate Committee on Health, Education, Labor and Pensions adopted a measure, endorsed by the Obama administration, to have the government provide long-term care insurance in which workers would be automatically enrolled unless they opt out. Premiums would flow into the system beginning in 2011, but benefits would not begin to be paid out until five years later; consequently, over the 10-year budget window through which the Congressional Budget Office assesses legislation, the program would bring in $58 billion, according to CBO estimates. Thankfully, the committee also agreed to an amendment, offered by Sen. Judd Gregg (R-N.H.), to require that premiums be set at an actuarially sound level — not so low that the program would end up further draining the federal treasury. Still, the money that flows in during the 10-year budget window will flow back out again. These are not “savings” that can be honestly counted on the balance sheet of reform.

This kind of sleight of hand has no place in the process. In fact, it invites the kind of public skepticism that undermines support.

Lawmakers, give us the facts. And make sure they are the whole facts. Consumers deserve it.

A bump or a roadblock?

As if negotiating the most significant healthcare reform in decades is not challenging enough, the nation’s most divisive public policy issue inevitably will end up in the middle of the debate.

Abortion, or more correctly, whether funds will pay for abortions, is a key flashpoint that Democrats must resolve.

An ultimatum against using federal money for abortion procedures could reopen the politically treacherous rift over the issue, creating yet another obstacle for congressional Democrats to overcome if they are to achieve their health reform goals, Time reports. “While current versions of the [health reform] legislation do not address the abortion issue at all, late last month 19 anti-abortion Democrats in the House sent a letter to Speaker Nancy Pelosi, warning ‘we cannot support any health care reform proposal unless it explicitly excludes abortion from the scope of any government-defined or subsidized health insurance plan.’”

Congress banned spending federal Medicaid dollars on abortions in 1976, and all but 17 states banned paying for the procedures with state Medicaid funds, too. However, as many as 90 percent of private insurers do pay for abortions and the restrictions the legislators are demanding could compromise those benefits. Under one proposal, individuals earning up to $43,000 a year who get subsidies to buy insurance could not purchase a policy that has abortion coverage. “And it would raise all sorts of other questions if insurers were allowed to discriminate among their customers based on whether or not they are using federal dollars to pay for their policies,” Time reports.

The issue is a potential landmine. Unlike fiscal issues, which are candidates for compromise, abortion is often seen as a black-and-white issue where mediation is problematic.

Is this issue enough to stall the legislative push for a comprehensive healthcare package? Probably not. It is, however, an example of one key bump in the path that could become a roadblock if not addressed with care.

Use it or lose it for health benefits?

Virtually every child recalls the scenario. Spoonful of medicine in hand, a parent forces a sick child to swallow the liquid so he or she can get better.

As we appreciate as adults, taking the medicine was a wise, even necessary, action.

Should employers who provide group coverage follow the example?

A small, but growing, number of employers seem to think so. They are requiring employees to take baseline diagnostic tests or risk losing coverage.

The Wall Street Journal recounts the experience of AmeriGas, where 44% of the workforce smoke.

AmeriGas had tried a number of voluntary wellness programs to encourage healthy habits in its employees. But the company concluded that “optional programs just don’t work,” says Bill Katz, vice president for human resources.

Then, beginning last year, the company mandated that all employees would have to get physical exams, blood-pressure checks and cholesterol and blood-sugar tests. Women also were required to get Pap smears, and mammograms for those 40 and older.

Workers and their covered spouses would have a year to complete the tests, which are covered 100%, or lose their insurance. And they’d need to keep getting the checkups at least every two years in order to retain the health benefits.

Of course, the required check-ups make sense on a number of levels. Early diagnosis of high blood pressure, diabetes and cancer can save a worker’s health. As well, wellness care can save the company money in reduced premiums over time and less worker losses.

But, as some suggest, is it too heavy-handed? Is it an invasion of privacy that is too intrusive?

I understand the concerns, but think not. As long as objectives are fair and clearly stated, an employer should be able to insist on wellness care as a condition of group insurance participation. This is a legitimate business objective and employees are not forced to undertake the exams to retain employment.

As the focus on using healthcare resources more efficiently and effectively gets proper attention in the larger debate, wellness care must be part of the plan. And, just like our parents did with a spoonful of medicine, employers should be able to place reasonable expectations on their employers to take it.

Simple steps to savings

Every so often, advice comes along that is so concise, that it should be shared verbatim.

That is the case with the Orlando Sentinel’s guide to avoid the pitfalls of health insurance costs. With our compliments, we quote:

Avoid the following pitfalls, which can actually end up costing you more money:

1. Focusing too much on premiums. Switching to a lower-premium policy isn’t always the best move. You need to look at out-of-pocket costs as well as premiums.

A low-premium policy with high coinsurance charges for drugs you use or doctors you visit could cost you a lot more by the end of the year. For example, more plans are switching from co-payments (in which you pay a fixed dollar amount for doctor’s visits and prescriptions) to coinsurance (in which you pay a percentage of the cost).

Most plans have three or more pricing tiers for prescription drugs, charging the lowest amount for generics (such as $10 or 10 percent) and charging a higher cost share for preferred brand-name drugs, more for nonpreferred brand-name drugs, and even more ($75 or 25 percent is average) for specialty drugs. If you take expensive medications and the insurer charges a high coinsurance rate, you could pay a lot more money out of your pocket than you would with a higher-premium policy that requires smaller co-pays.

Also, some plans charge a fixed-dollar co-pay for hospital stays, while others charge a percentage of the cost or have a separate hospital deductible, which can cost you a lot more.

The same is true for out-of-network doctors and hospitals. Some of the lowest-cost policies limit the doctors and hospitals you can use. As long as you stick to in-network providers, you can save a lot of money. But you may have a much higher co-payment or coinsurance rate for out-of-network providers or hospitals. Make sure that all the doctors at hospitals you use are covered before switching to one of those plans.

2. Cutting the amount of coverage. Some health-insurance policies charge much lower premiums but also offer much less coverage. Policies that offer maximum benefits of less than $1 million could leave you with tens of thousands of dollars to pay on your own. For example, some policies have low premiums and require small co-payments for doctor’s visits, but they cover just $50,000 to $100,000 worth of expenses per accident or illness, which isn’t enough to cover most major medical issues.

Other limited-benefit policies have low dollar limits for each type of procedure and a lot of exclusions, which could leave you with big bills. When you hear horror stories of people having to pay huge expenses even though they had insurance, they usually had these types of limited-benefit plans.

A better way to lower your premiums is to buy a high-deductible health-insurance policy that provides much better coverage for major medical issues. You may have to pay $1,000 or more before coverage kicks in, but you’ll protect yourself against tens of thousands of dollars in catastrophic costs if you have a major illness or accident.

If you buy a policy with a deductible of at least $1,150 for single coverage or $2,300 for family coverage in 2009, you’ll be able to make tax-deductible contributions to a health savings account (contributing up to $3,000 if you have single coverage or $5,950 for family coverage in 2009). You can then use the HSA money tax-free for medical expenses in any year. If you don’t have many medical expenses, the money can grow tax-free for future health-care costs.

3. Assuming that COBRA coverage is the best deal. A lot of people who lose their jobs are attracted to COBRA coverage now, which lets them keep coverage under their former employer’s plan for up to 18 months. The economic-stimulus plan provides a 65 percent subsidy for COBRA premiums for up to nine months for people who were laid off since September.

But after the subsidy ends, the price will jump significantly. The average employer policy costs $4,700 a year for individuals or $12,600 for families, according to the Kaiser Family Foundation, and you’ll need to pay 102 percent of the total cost yourself after the subsidy is over (or if you don’t qualify for the subsidy).

If you have any health issues, COBRA may be your best bet. But if you’re healthy and live in a state with a competitive health-insurance marketplace (not New York or New Jersey), you could find a better deal on your own.

Many healthy people can find an individual policy for $250 a month or less (or $100 a month or less if you’re young and healthy), especially if you buy a high-deductible policy with a health savings account. You can get price quotes for individual policies at eHealthInsurance.com or find a local agent at the National Association of Health Underwriters.