Thursday, November 30, 2006
Health Wonk Review is up
One Doc "Gets It"
Wednesday, November 29, 2006
The HDHP debate will probably continue for some time. Who really benefits from these plans?
Our contention at InsureBlog is that (almost) everyone can benefit in some way from the HDHP coupled with the HSA. A recent Kaiser Foundation survey would seem to bear that out.
For example, compared to people with traditional health insurance, those in consumer-directed plans are more likely to say that they always or sometimes ask about the cost of a doctor’s visit before making an appointment (39% vs. 23%) or that they always or sometimes ask about less costly alternatives (57% vs. 38%). And, over half of consumer-directed plan enrollees who have used any services under their plans say that being in such a plan has changed their approach to using health care. Of those, 57% say they changed due to cost considerations.
The observation here supports our contention that those who pay the bills are more concerned about cost containment than those who are simply beneficiaries.
If you pay, chances are you are going to ask how much it costs before making a decision on treatment. If you pay, you may also ask for alternatives that may be lower in cost but just as effective.
If someone else is paying, then price is rarely a consideration.
And there is this.
However, based on these early experiences, it appears to be that consumer-directed plan enrollees are not yet becoming the kind of savvy shoppers that advocates for these plans envision. Relatively few say they have used their plan’s Web site to compare prices across providers (5%) or to compare quality across providers (7%) – essentially the same low rates of comparison shopping reported by those in traditional plans. A small exception may be shopping for prescription drugs, with people in consumer-directed plans somewhat more likely to say they used the Internet to shop for drugs (19% vs. 10%).
Only 5% use the resources available to compare provider prices. Only 19% compare prices for Rx.
If consumers are this apathetic when spending their own money, how much more so are they when spending the carriers money?
Justice is Blind
OK. This site is about insurance, mostly health insurance. But sometimes a bit of news comes along that is related . . . kind of . . . and I just have to vent. After all, this is a health related issue.
The government discriminates against blind people by printing money that all looks and feels the same, a federal judge said Tuesday in a ruling that could change the face of American currency.
U.S. District Judge James Robertson ordered the Treasury Department to come up with ways for the blind to tell bills apart. He said he wouldn't tell officials how to fix the problem, but he ordered them to begin working on it.
While I have no disagreement with the comment by the judge. Certainly paper money is for the sighted, but blind people have been around since the beginning and money (or some form of exchange currency) for centuries. So why have our courts been clogged with this suit now?
One could also argue that our money discriminates against those who cannot read English.
If this suit continues, what is next? Banks? I mean, why do drive up ATM's have braille instructions?
And you have to wonder about the charge from the bench. Basically, he doesn't care what they have to do to correct this problem, and he has no clue how it should be fixed, but he still wants it corrected.
This guy is no Solomon.
Don't get me wrong. I have nothing against blind people (or any other individual with a disability). But I gotta ask. Who thinks up this stuff?
We Have WAYS to Make You Comply
Massachusetts has implemented the first stages of the Health Care Reform Act, a widely-watched, first-of-its-kind health-care measure designed to provide every Bay State resident with health insurance, in some form. If they don’t receive it from their employers, they themselves will be required to buy it. As of this past October 1, the law imposes fines for employers who don’t offer insurance and, as of next July 1, it will penalize individuals who do not elect to purchase it.
A good idea in principle but I still have my doubts this will work as planned. Something about this article reminded me of Col. Klink in the old Hogan's Hero's TV show.
Health Savings Accounts, which have been growing in acceptance across the country, are one such product (see related feature, page 22). But because Massachusetts is still an HMO-rich state, their acceptance has lagged here, says Tsotsis. He cites an instance in which his company worked for two years to put such a plan in place to cover 4,000 eligible people, but only 100 signed up for it.
Actually, 3% penetration is not that much different from data I have seen nationwide. For the most part, the HSA seems to be more widely accepted in the individual market than it is the employer market.
We will keep our eye on this situation.
Tuesday, November 28, 2006
Big Brother, or Good Risk Management?
Monday, November 27, 2006
Medical Tourism: A New Twist
Buy It When You Feel Threatened
Derek Dailey, a 28-year-old restaurant waiter and musician in Florence, said insurance is not something you think about "until you're faced with a situation where you need it - when you feel threatened.
"I haven't had health insurance in about five years," he said. "When you have to pick between auto insurance and health insurance... you pick auto - if you have to pick between the two."
Buy it when you feel threatened. Great advice.
Right before the oncoming car hits you, call 1-800-GetHealthInsuranceNow for your coverage.
Makes sense to me.
A leading state lawmaker says it’s time to consider re-regulating health insurance premiums.
In Syracuse this afternoon, the chairman of the Assembly Insurance Committee told a hearing that insurance companies appear to be in a “get it while we can” mentality, hiking rates now, before the state returns to a system of approving future increases.
Assemblyman Pete Grannis said insurance companies are paying less in claims, and charging more in premiums.
He labeled those trends “unsustainable” and blasted what he called “extraordinarily one-sided contracts” between health insurance companies and health care providers.
Government controlled pricing is great election year rhetoric but has a 100% failure rate, no matter what the industry.
When government opts to regulate prices there is less competition. If carriers are not allowed to receive a reasonable rate on their investment they cease to write new business and eventually withdraw completely from the market place.
As this happens it becomes more difficult, and eventually more pricey, for individuals to secure the coverage they desire. Carriers who remain in the business turn to other methods to sustain profitability such as only offering a limited number of plans, making underwriting more challenging, tightening claims approval and restricting benefits.
Glad I don't live in NY.
Saturday, November 25, 2006
Is Fair, Fair?
We talk a lot about personal responsibility here at IB, but have so far shied away from this particular controversy (mostly because it’s been somewhat under the radar). But we have discussed the importance of “risk” many times, and this would seem to fall squarely in that milieu.
Longtime readers may recall the IVF kerfluffle some time back: we sometimes forget that behavior choices have consequences. Certainly smoking falls under that heading: I’m aware of no medically-approved treatment plan that mandates one to “light up” (medical marijuana use notwithstanding). Smoking has been linked to any number of health risks, and of course smokers are subject to an increasing number of restrictions on their behavior.
Weight is another such issue: obesity can increase one’s chances for heart attacks, diabetes, and other dread diseases. Overweight folks might argue that they are subject to metabolic challenges that affect their condition, and there is probably some justification for that. Nevertheless, their condition does affect their health; underwriters are less interested in the why than in the fact.
In the life insurance and individual medical markets, smoking status and weight have long been used in assessing one’s rates. In the group market, though, these issues receive considerably less play. Generally, group plan underwriters look at the results of the behavior (cancer, diabetes, stroke, etc) when determining final rates for a group. I haven’t (yet) seen a group screening questionnaire that asks about smoking status of employees; likewise, there’s been no evidence that the behavior itself plays any part in the underwriters’ decisions.
But, if there’s enough of a demand, the industry will most likely respond. At some point, some carrier will announce a special discount for smoke-free groups, or some other program along those lines. It will be interesting to see when (not if) that happens.
Thursday, November 23, 2006
How to Insure a Great Thanksgiving
Speaking of fryers (the cooking technique, not the variety), the U.S. Consumer Product Safety Commission reports that over a seven year period (ending last year), there were over 100 "incidents" related to turkey frying, mostly by folks who lit up their birds (metaphorically, we hope) and then just wandered away for a bit.
Never having been bitten by the frying bug, I think our family's (relatively) safe. One tip: if you've never brined your bird, this year's a great time to start. There's no better way to insure a moist and tender tom.
And speaking of turkeys, our friends in Massachusettes may well cry "fowl!" According to a Bay State bond filing, it appears that the state's new MassHealth plan will end up costing its taxpayers twice what had been anticipated. Talk about 3rd degree burns!
Have a great, and safe, Thanksgiving.
BONUS: A blast from the past. Enjoy!
Wednesday, November 22, 2006
The Cavalcade of Risk #13...
I was intrigued by Car Geeks' report on the dangers of electric cars. While they may get terrific mileage, they've got some major safety problems, too.
Tuesday, November 21, 2006
This is Where Your $11 Went
Healthcare for illegal immigrants between the ages of 18 and 64 cost American taxpayers $1.1 billion in 2000 — or about $11 per household — according to a study released Tuesday by the Rand Corp
Don't get me wrong. A billion is a lot of money, but most folks will lose $11 in the sofa during the course of a year.
Apparently the Rand Corporation miscounted . . .
The Federation for American Immigration Reform questioned the study's conclusions, saying it estimates the total cost of healthcare for illegal immigrants in California alone at $1.4 billion
Oh yeah, I forgot about those folks. The Federation. Aren't those the Star Trek folks?
Has anyone counted up how much it costs to cover legal residents who can afford but choose to go without cover?
This Won't Help You
but it will help me pay my mortgage.
Wonder what would happen if medicine really did have transparency? Suppose you had access to data that supports less treatment rather than more. What would you do with that data?
The St. Paul Pioneer Press on Sunday examined how a recent study indicates that "hospitals that provide more intense care do not prolong life for patients with chronic or terminal illnesses." According to a study conducted by Dartmouth Atlas, Medicare could spend $19 billion less on end-of-life care for beneficiaries and obtain the same outcomes (Olson, St. Paul Pioneer Press, 11/12).
So, spending more on health care does not produce better results.
Study participants, who were ages 67 and older, had at least one of 12 chronic illnesses and died between 2000 and 2003 (Kaiser Daily Health Policy Report, 5/16). The study found 5% higher mortality rates among heart attack and colon cancer patients who received the most care
In fact, less care has a lower mortality rate.
Some health policy experts also have recommended that health insurers begin to cover palliative care, which focuses on pain management and helps patients consider their options for end-of-life care. Lyn Ceronsky, director of a palliative care program at the University of Minnesota Medical Center, Fairview, said, "It's never 'We don't think you need this,'" adding, "It's 'What are your goals and how can we make sure our care plan really matches them?'"
We don't think you need this, but the government (read taxpayer) is paying your bills, so don't worry.
The scooter industry may be in trouble.
Medicare officials have agreed to lessen the proposed cuts in reimbursement rates for power wheelchairs and scooters, particularly for equipment used by the most severely disabled.
The new rates announced today will take effect Nov. 15. The changes are part of an effort to combat fraud and ensure Medicare beneficiaries have access to the appropriate wheelchair or scooter, said Jeff Nelligan, a spokesman at the Centers for Medicare and Medicaid Services.
If valid, I have a real problem with this line particularly for equipment used by the most severely disabled. At this point I cannot say if this is editorializing or based in fact.
There are plenty of abuses by "big business", particularly where a mostly unaccountable third party is the payor. I know some carriers in the Med Supp business that limit their payment on scooters. Otherwise everyone on Medicare would have a scooter (and some days it seems like everyone does).
The changes sought by federal officials come after a 2004 study showed that Medicare reimbursements for certain power wheelchairs were far higher than the prices paid by consumers and suppliers. Also, agency expenditures for the equipment jumped from $43 million to $1.2 billion in the eight years prior to the study.
A 28 fold jump over 8 years.
So much for government oversight if taxpayer dollars . . .
Younger and Younger…
Monday, November 20, 2006
Sunday, November 19, 2006
Friday, November 17, 2006
Cavalcade #13 - Submissions Due
Thursday, November 16, 2006
The Best Laid Plans of Mice and Men...
An electronic health records management system being rolled out by Kaiser Foundation Health Plan/Hospitals has been nothing short of an IT project gone awry, according to sources at the company and an internal report detailing problems with the HealthConnect system.
Questions about the project arose last week at about the same time Cliff Dodd, the company's CIO, resigned. Dodd stepped down last Monday after another Kaiser employee, Justen Deal, sent a memo to every company worker (n.b. all 180,000 of them!) warning of technological and financial repercussions related to the rollout of the nearly $4 billion system.
Kaiser is reportedly spending $76,920 per physician on the project. The full ComputerWorld article is here. There's another good article in eWeek.
For those not in the electronics industry, the 99.5% uptime mentioned in the eWeek article may sound good, but a system like this should have enough software scaling ability and redundant computer horsepower to be running at 99.99+%. The power failures that the CEO cites should never affect system availability.
Your Tax Commissioner Beckons
The state that gave us witch trials & Teddy Kennedy never ceases to amaze us. The new law requiring citizens to have health insurance goes in to effect next year has some more surprises.
The state's new health-care law contains a costly surprise for municipalities -- a requirement that young adults be allowed to stay on a city or town's group health-insurance plan for up to two years longer than they were allowed previously.
The new law, which legislators passed last spring, aims to help every Massachusetts resident purchase health insurance by July 2007. Young 20-something adults make up a portion of the state's 500,000 uninsured residents.
Currently, young adults cease to be covered as dependents on their parents' health-insurance plans when they graduate from college or turn 23.
But as of Jan. 1, when this particular component of the new law takes effect, that age limit will be raised to 25. And for cities and towns, that will mean coming up with more money so the dependents of municipal employees remain covered.
Wonder how much this free coverage is going to cost once the final bill comes in?
CDHC: Smaller Increases?
Health Wonk Review at HBB
Wednesday, November 15, 2006
Life Insurance, for FREE?!
Man Bites Dog
Officials of Massachusetts Gov. Mitt Romney's (R) administration are "now telling Wall Street that they expect" the state's new law requiring all residents to obtain health insurance by July 1, 2007, "to be quite expensive," even though "supporters promised that health insurance could be provided with only a slight increase in expenditures," Sally Pipes, president and CEO of the Pacific Research Institute, writes in a Washington Times opinion piece.
This is news?
According to Pipes, officials now say "the new plan will increase Massachusetts government health spending by $276.4 million in 2007" -- a $151 million increase "over what the public was told the plan would cost as recently as April." She continues that an Aug. 17 bond filing "reveals why Mr. Romney and friends had no problem getting consensus from the health community" and Democratic leaders, noting that according to the filing, the plan calls for $386 million in rate increases for hospitals, physicians and managed care organizations.
In any other industry, this would be known as a bribe.
In addition, current government programs will receive $85.2 million to restore state Medicaid dental and eye care benefits and expand eligibility of the MassHealth program, according to the filing. In addition, the filing also discloses that the "plans being discussed by the panel for low-income people will cost $25 million more than originally projected," which "would put total first-year costs north of $300 million,"
Higher projected costs. I am shocked!
Pipes writes, adding, "Although federal taxpayers are expected to pick up some of this tab, the majority of it will fall on Bay State taxpayers."
And higher taxes for MA residents. When will it all stop?
In addition, the $295 per employee contribution "ceiling" being imposed on employers to help fund the plan will likely "prove to be a floor" because "the extra money must come from somewhere," and "[s]tate activists, legislat[ors] and the Democratic gubernatorial hopeful are already grumbling that businesses need to pay more," according to Pipes (Pipes, Washington Times, 11/5).
I could say I told you so . . . but I won't.
A study by US researchers has turned up surprising results – medical care delayed by three or more days gives no benefit to heart attack survivors with mild or no symptoms. The results are specifically aimed at procedures to open clogged arteries, the most widely used treatments today.
Almost all heart attack patients with completely blocked arteries are recommended angioplasty or the procedure to clear arteries if they seek treatment within the first 12 hours following a heart attack. This early treatment helps restore blood flow to the heart. It also preserves the heart muscle and reduces the risks of death due to heart failure.
However the treatment is effective only if given during the 12-hour window. Currently around 30% of acute heart attack patients arrive at the hospital after this period. Writing in the New England Journal of Medicines, the researchers said there is no additional benefit gained from restoring blood flow after three days as compared to standard drug therapy. There is no reduction in the risk of death, a second heart attack or heart failure.
Perhaps the most fascinating thing to me is, a former colleague observed this phenomena some time ago. That was approximately 20 years ago.
So what took the NEJM 20 years to figure that out?
Tuesday, November 14, 2006
Other Than The Stroke . . .
People still amaze me. Perhaps I have spent way too much time in this business and just take things for granted. There are some things in life that you just ASSUME are common knowledge.
Things like, don't drink and drive. Sure some people do it, but they will admit (at least in their sober moments) that is something they should not do. At least they KNOW drinking & driving do not mix.
Or, just because you have checks in the checkbook does not mean you have enough money to cash them. Yes, some people still try to play the float game, and others just never bother to reconcile their checkbook and have no idea how much money they have. When the check bounces it is a total surprise, but at least they knew the bank would not honor the check if there was not enough cash in the account.
For some reason, these common knowledge things go out the window when it comes to health insurance. Otherwise, why would I have the following come up from time to time?
A woman calls looking for health insurance with an immediate maternity benefit.
How immediate? Most policies have a 9 - 12 month wait but I do have one policy with no waiting period.
That's the one she wants. The one with no waiting period.
Fine. You can get this as long as you are not pregnant now. If we apply now you can have coverage in place by the first of next month.
Oh, well. That won't work.
I am due next month.
Today I had a man call who was looking for health insurance. He is on COBRA but can't afford the $500/month premiums and is looking for something less expensive.
What kind of plan I ask?
Probably something temporary, until I can find a new job. Or maybe on of those HSA's.
Great. Are you taking any meds?
No, I am in good health. No meds. Other than the stroke I had 2 years ago I am in great shape.
I have some bad news for you. Keep the COBRA, it is your only option.
Grand Rounds is up...
Monday, November 13, 2006
Not Quite Ready for Prime Time…
Sunday, November 12, 2006
Saturday, November 11, 2006
How Much Is . . .?
As much as many consumers hate shopping for cars, that’s nothing compared with trying to get an estimate on the cost of a medical procedure or a routine visit to the doctor.
One consumer health-care survey found that the typical consumer could predict the price of a Honda Accord to within $1,000, but was off by about $12,000 in estimating the average cost of a four-day hospital stay. People guessed an average of $7,762 when the cost was $20,000.
When you don't directly pay for services, but rather allow a third party to be billed, most people have no clue what the actual cost will be.
And Now For Something Completely Different...
“Is a burrito a sandwich?
The Panera Bread Co. bakery-and-cafe chain says yes. But a judge said no, ruling against Panera in its bid to prevent a Mexican restaurant from moving into the same shopping mall…
"A sandwich is not commonly understood to include burritos, tacos and quesadillas, which are typically made with a single tortilla and stuffed with a choice filling of meat, rice, and beans," Locke wrote in a decision released last week.”
Apparently, the Panera at this particular mall has a clause in its lease that prohibits another “sandwich shop.” Their contention is that a burrito is a sandwich, meaning that Qdoba (the Mexican eatery at issue here) is outta luck.
I don’t know: the folks at Slashfood say “A sandwich is any kind of food that you can combine with another kind of food and/or condiment and eat it while holding it in your hand…sometimes (especially in these carb-counting times), a sandwich can be made without bread.”
On the other hand, “The first recorded sandwich was by the famous rabbi, Hillel the Elder, who lived during the 1st century B.C. He started the Passover custom of sandwiching a mixture of chopped nuts, apples, spices, and wine between two matzohs to eat with bitter herbs.” (At our family’s seder, we call this a “Hillel Big Boy") Since matzah is unleavened bread, this would seem to settle the question in favor of the ubiquitous bakery/café.
On the gripping hand, Sandwich is a town in Barnstable County, Massachusetts, United States. The population was 20,136 at the 2000 census.
I guess that doesn’t really help much.
I tend to side with the judge here; if a burrito is a sandwich, then so is a crepe, a blintz, and moo shoo. Just because a food can be held and eaten with one hand doesn’t mean it’s a sandwich (ice cream or otherwise).
Friday, November 10, 2006
The lawyers have been at it again...
As has been covered in several previous posts, Blue Cross of California is in the middle of a class action lawsuit over rescission of coverage. When used appropriately and with discretion, the ability to rescind coverage is important to protect the carrier against fraud. It's also a disaster for the consumer if it's inappropriately applied.
We've just received the new version of the small group application forms and there have been dramatic changes that address this issue. I thought you would be interested to see the differences between the old and new forms.
Here is the wording in previous version of the employer app:
Coverage may be rescinded if there are misstatements in this application.Simple. No? And now for the new version:
RescissionThat's potentially a bankruptcy-level penalty for a small business.
We have provided a complete history of material information that is considered in the acceptance or denial of the enrollment application. Following approval of coverage, if Blue Cross discovers that we intentionally provided incomplete or false material information or withheld material information from Blue Cross prior to the Effective Date of the Agreement, Blue Cross may revoke coverage. This means Blue Cross may cancel coverage as if it never existed.
If Blue Cross revokes our Group coverage under the Combined Evidence of Coverage and Disclosure Form, Blue Cross will send a written notice explaining the basis for the decision and our appeal rights. We have the option to submit a new application in the future to be underwritten and considered for enrollment. We will be required to pay for any services that were covered for an employee, and Blue Cross will refund any amounts paid by our Group except amounts already paid by Blue Cross on behalf of our employees.
We have personally read and attest to the completeness and validity of the information provided on this application for coverage. If we are accepted, this application will become part of the contract between Blue Cross and our Group. We and any enrolled family members agree to abide by the terms of that contract. Initials: (emphasis added)
And on the employee's side, the old app read:
Even if this application is approved, any misstatements or omissions may result in future claims being denied and the policy being rescinded.The new employee application reads:
RescissionNotice that the old version of the employee application has ambiguity in the difference between "future claims" and the concept of rescission back to day one. The new version clears that up and basically says that you're toast if the coverage is rescinded. It also specifically adds in the words "intentionally" and "materially" so trivial and accidental omissions don't provide a basis for rescission...regardless of the size of the claim that triggered the review.
I have provided a complete history of material information that is considered in the acceptance or denial of this enrollment application. I understand and agree that I alone am responsible for the accuracy and completeness of this application, and to the best of my knowledge and belief, I have done everything necessary to be able to assure you that all information about any children under the age of 18 listed on this application is true and complete. Also, all of my dependents listed on this application that are over the age of 18 years have read this application and have provided complete and accurate Information for this application. I understand and agree that following approval of the enrollment application, if Blue Cross discovers that I intentionally provided incomplete or false material information or withheld material information from Blue Cross prior to the Effective Date of the Agreement, Blue Cross may revoke coverage. This means Blue Cross may cancel coverage as if it never existed.
If Blue Cross revokes your coverage under the Combined Evidence of Coverage and Disclosure Form, Blue Cross will send you a written notice explaining the basis for the decision and your appeal rights. You have the option to submit a new application in the future to be underwritten and considered for enrollment. You will be required to pay for any services that were covered while you were a Member, and Blue Cross will refund any amounts paid by you except amounts already paid by Blue Cross.
I have personally read and attest to the completeness and validity of the information provided on this application for coverage. If I am accepted, this application will become part of the contract between Blue Cross and I. I and any enrolled family members agree to abide by the terms of the contract. Initials:
The new forms are a huge improvement in openness and clarity. Rescission is a very serious matter and it's important that it be fully explained.
Down Under...Lookin' Up!
Here's a bit of news...
Australian researchers found that Google identified the correct diagnosis in 58% of uncommon medical cases, after entering a few of the symptoms from the 26 cases into the search engine, according to an online study from the British Medical Journal, the London Daily Express reports (Fletcher, London Daily Express, 11/10).Cool! A new cost savings feature...you can use Google to diagnose yourself! Now, if they can just get that 42% error rate down a bit...
Forest Gump Insurance
In the movie "Forest Gump" the lead character played by Tom Hanks was noted for saying "Stupid is as stupid does". Insurance buyers are not necessarily stupid, but they are ignorant when it comes to matters of risk management and insurance.
Stupid is defined as "lacking or marked by lack of intellectual acuity", while ignorant is "uneducated or lacking specific knowledge".
I had a Forest Gump client in the last few weeks. Like most of my clients, they were ignorant of the risks involved. The wife had a medical history that was going to be difficult to overcome while the husband was in relatively good shape. As it turned out the wife was declined (not surprising) but the husband was offered coverage.
We chose a particular carrier to submit the application because this carrier is more liberal on cancer history than others. Both the husband & wife are 62 so the rate was not inexpensive. They wanted a high deductible plan. More specifically, they wanted hospital only coverage.
I explained that half of all claims paid by carriers were for hospital charges and what they really needed was a comprehensive major medical plan. I assumed, incorrectly as it turns out, that they would understand my comments about hospital only coverage since the wife had gone through surgery, chemo & radiation for her cancer. She also takes medication in hopes of warding off a return of the cancer.
She was declined; his policy was approved with a $500 monthly premium. They were out of town while all this was transpiring so I sent them an email & left a voice message about the outcome.
She was not pleased at being declined (even though I had warned it was a possibility). She told me they were not interested in the policy for her husband. Seems he had found "just what we need" with a deductible that was half the one I quoted and also half the premium.
Turns out they bought the hospital only plan I had warned them against.
These people are not stupid, but they are ignorant of the risk involved. Ignorant is as ignorant does.
At least that is what Forest Gump would say.
More from Across the Pond…
Thursday, November 9, 2006
FSA = Failing Support Abounds?
Cavalcade #12 Is Up...
Wednesday, November 8, 2006
It’s a Wash, Right?
Tuesday, November 7, 2006
Monday, November 6, 2006
HSA/MSA in the News...
Sunday, November 5, 2006
Safety at Work
According to its website, the Bureau of Labor Statistics “is the principal fact-finding agency for the Federal Government in the broad field of labor economics and statistics.” One of its functions is to track the number (and severity) of injuries we suffer while at work:
We don’t know, of course, what’s caused this decline; perhaps our friends at Worker’s Comp Insider will have some insights. Regardless, this seems to me to be good news.
Saturday, November 4, 2006
Supply and demand run hand in hand with price, at least according to economic theory.
As demand increases, so does price at least until supply catches up with demand, then prices fall.
This may be true for food, clothing & transportation but the economics of medical care respond to their own set of rules.
This axiom of economics does not hold in the health care market; at least not according to a 1998 HCFA White paper to Richard Foster. The paper found that when Medicare decides to reduce its fees, the quantity of medical services supplied by physicians actually increases. In fact, a Medicare price decrease led to increased medical service volume and intensity by 31% (significant at the 5% level). A Medicare price increase also increased volume and intensity but the results were not statistically significant.
Other papers have found similar results:
Yip (1994) found that after Medicare reduced the price for coronary artery bypass graftings (CABGs) in New York and Washington, there was a large and statistically significant increase in the volume and intensity of CABGs.
Christensen (1992) looked at the state of Colorado in the 1970s. He found that a one half of a Medicare price decrease was offset by increased volume of medical services and one third of the price decrease was offset by increased intensity of medical services.
Nguyen and Derrick (1997) estimated a behavioral response which was statistically significant only among physicians whose practices received a Medicare price reduction. The magnitude of the response was 40% for these firms.
The following observations are revealing.
Why is this occurring?
First, patients often do not know what type of care they require so they physicians can suggest treatments which may be unnecessary.
Since patients bear little cost of these procedures, their price sensitivity is low relative to the total cost of a procedure. (emphasis added) It is also possible that when Medicare prices decrease, the amount of the coinsurance paid by patients needed to cover a procedure goes down; this demand change may have some influence on the increase in quantity.
Uncertainties in the practice of medicine allow for a variety of practice styles, so even peer review or a physician’s behavior may not be appropriate.
Friday, November 3, 2006
Govt Run Healthcare
In other areas, public hospitals have boards of advisers or directors who devote enormous time and effort to planning for the institutions' future.
Not in Cook County.
Here, public hospitals are run by the government, and that means they are bound by county regulations, hobbled by outmoded business practices and captive to county politics. Practically, it also has meant the County Board president runs the county health system with little effective oversight
snip . . .
Many observers say the setup has left the $830 million county health system adrift, without a clear plan for dealing with existing or future challenges, as financial pressures mount and growing numbers of needy county residents seek expensive medical services.
The only other major city that runs its health system in a similar way is Los Angeles, and that system is teetering on the brink of collapse.