Still fuming...

Wednesday, October 01, 2008

As we survey the carnage from the vetoes of the past few days, I want to highlight AB2(Dymally), a top priority for Health Access California, AARP, and many other consumer groups.

Must has been made of the rescission issue this year, where several thousand people over the past few years have been retroactively denied for coverage for "pre-existing conditions" that they may have not disclosed on their applications.

But many more are denied by insurance companies for "pre-existing conditions" up front, at the time of application. They are not eligible for public programs or group coverage through their employer, and no insurer will take them, for any price.

Uninsured and uninsurable, they have no place left to go. California has MRMIP, which gives them the privilege of paying above-market premiums for coverage that is capped at $75,000. Even though these patients are paying very expensive premiums, they still need a subsidy, and MRMIP only has a small amount of funding, enough to include only 7,100. The program has never been advertised, and probably doesn't begin to meet the need. But even so, there's now a 600+ person waiting list.

No one thought AB2(Dymally) would have solved the problem, but it would help: it basically would have put a small, less-than-a-dollar fee per-subscriber on health plans in the individual market (the place where these denials happen), in order to better fund MRMIP, cover those on the waiting list, and lift the $75,000 cap that makes the coverage less than adequate for a less-than-healthy population.

The need is much greater. Passage of AB2 would not have, in any way, shape or form, removed the momentum or urgency for broader health reform, one that included guaranteed issue for all insurance products, increased group coverage, public program expansions, a universal publicly financed health program, and/or a combination thereof. AB2 was too small, too inadequate a solution.

But it would have helped those 600 people who are willing to pay, but still have no place to turn for coverage, and as a result will live sicker, die younger, and be one emergency away from financial ruin. And many more in the next few years, as we work for a broader, better fix.

Instead, the Governor turned his back on those patients, and many of his former allies on health reform.

Labels: GuaranteedIssue, Insurers, Legislation, Schwarzenegger

posted by Anthony Wright | Permalink | 8:21 PM


 

Value in the Individual Insurance Market

Monday, September 22, 2008

Our post on whether we can ever fully fix the individual insurance market got a decent amount of attention last week, from the Kaiser Daily Health Policy Report to the Disease Management Care Blog hosting Health Wonk Review this week. As always, both are chock full of interesting links, especially around health policy questions relating to the presidential race, and at least one from the New America Foundation on rekindling reform in our Golden State specifically.

One response from our post was from Louise at the Colorado Health Insurance Insider, which agreed with our assessment that a McCain-like approach to simply shift people to the individual insurance market "will spell disaster for people with pre-existing conditions" without further reforms.

We also agree that guaranteed issue isn't enough: she worries about a potential increase in costs if insurers are required to take the sick, and not just the healthy. Some argue for an individual mandate to get a broader base of contributions that would help lower the cost for the sick. I worry, with or without a mandate, that the individual market is still inherently unfriendly for individual consumers, leaving them at the mercy of the big insurers, without the bargaining power of subsidized group coverage.

In stating the case for the individual market, Louise makes two points: One assertion is that the individual market is cheaper than the group market. That's only true if you compare apples and oranges, or healthy 20-year olds and sicker 60-year olds. It's simply not applicable to compare a plan that only accepts healthy folks, to those who also covers everyone.

And more importantly, when premiums are cheaper in the individual market, so are the benefits. Last year's study by Jon Gabel (on the California Health Care Foundation website) shows the value of individual insurance policies have sunk, with such plans paying only around half of the health costs of their subscribers. Louise's examples suggest that the cheaper policies left the consumer with significant bills.

The fundamental question is value: how to get the best price for a plan that will actually cover a consumer's health expenses. And the individual market has built-in costs and inefficiencies. It's more administratively burdensome and expensive to sell policies one-at-a-time versus to large groups, whether through advertising or brokers. There's the cost of underwriting individuals. And then there's just the issue of market power, where a large group can negotiate a better deal than an individual.

The second point is about portability, as opposed to the status quo where people lose their coverage (or have to switch providers) when they change jobs. Louise suggests that perhaps we can provide the benefits of group coverage without creating the "job lock"--and I think there are ways to do that: from a large purchasing pool that many employers buy into (and which provides a range of options, as do large employers), as envisioned in SB2 or AB x1 1, or even a state-financed health plan. There's been lots of talk, at the state and federal level, of offering a public plan option for people, which could potentially be available in multiple situations.

It seems we should be able to move to a system of seamless, portable coverage without having to give up all the other benefits of group coverage.

Labels: GuaranteedIssue, Insurers, OtherBlogs

posted by Anthony Wright | Permalink | 10:22 PM


 

Blue Shield and Blue Cross settle on rescissions...

Thursday, July 17, 2008

Big day on rescissions. I was in Los Angeles, testifying before the LA County Commission on Insurance in support of SB840, health reform, and specific pending legislation on recissions--after all there are no less than four bills, sponsored by Assemblymembers De La Torra, Deleon, Hayashi, and Lieu, that include a number of reforms.

I thought I was providing the most up-to-date information, but a lot happened.

The Capitol Weekly and The Los Angeles Times reports on two major settlements, with Blue Shield to restore coverage to 450 rescinded patients and pay a $3 million fine, and Blue Cross to restore coverage to 1770 patients and pay a $10 million fine. Earlier settlements were already reached with Kaiser, HealthNet, and Pacificare, albeit with smaller fines and numbers of people impacted, given their market share.

We'll need to watch over the Department and the insurers to ensure their goals are reached for these consumers:"guaranteed issue coverage, a process for full monetary losses and no back premiums owed," as Department of Managed Health Care Director Cindy Ehnes had identified in the LA Times.

It's good that there has been a focus on getting these folks coverage as soon as possible, even as other court and other proceedings continue. The question is what laws can help moving forward so we radically reduce or eliminate these practices once and for all. The ideas pending include:
* providing a independent review of all rescission cases;
* standardizing the underwriting proccedings;
* shortening the time frame where a patient can be rescinded;
* eliminating bonuses paid to employees who rescind more patients;
* protecting family members' coverage when a family member is rescinded; and
* setting standards for brokers due diligence.

Finally, at the federal level, Congressman Henry Waxman and the House Committee on Oversight and Government Reform held a hearing on the subject, featuring testimony from several rescinded patients, a representative of the insurers, and from California, Secretary Dale Bonner, which oversees the DMHC. It put a federal spotlight on the issues, hopefully helped in getting some attention on these issues in a new light, maybe helped serve as an impetus for these settlements, and sets what being "a regular" may mean.

Labels: BlueCross, DMHC, GuaranteedIssue, Insurers

posted by Anthony Wright | Permalink | 10:53 PM


 

High-Risk policies, indeed...

Monday, July 14, 2008

Last week, one aspect of the McCain health plan was highlighted by Kevin Sack of the New York Times , in an article entitled, "McCain Plan to Aid States on Health Could Be Costly." It lays out the problem:

"If Senator John McCain’s radical plan for remaking American health care is to work, he will have to find a way to cover people like Chaim Benamor, 52, a self-employed renovator in this Baltimore suburb.... After being rejected by a number of commercial carriers, he turned to the Maryland Health Insurance Plan, one of 35 state programs for high-risk applicants whom no private company is willing to insure."

The McCain plan would eliminate the tax benefits for employer-based coverage, and thus push people from on-the-job group coverage into the individual market, where consumers (except in a few states) can be denied for "pre-existing conditions."

So what happens if one is denied? In California, your only option is the state's "high-risk" pool, MRMIP, the Major Risk Medical Insurance Program... but that now has a waiting period of over 1,000 patients!

And that's a program that has never been advertised, that's more expensive premiums than already-expensive market rates, and that caps annual benefits at a mere $75,000--less than a week in many hospitals.

Even though we suspect that the number of willing-to-pay-but-"uninsurable" customers are in the hundreds of thousands, the McCain plan would make this worse. And his only solution is to provide some federal assistance to plans like MRMIP. The question is: will it be enough?

With the new attention on the individual insurance market and "high-risk" pools, the Kaiser Family Foundation is hosting an "Ask the Experts" webcast tomorrow (Tuesday) at 10am Pacific Time on the subject. One of the experts is California's own Lesley Cummings, executive director of the MRMIB, which runs MRMIP. It should be interesting to hear her answers to question coming from a national perspective.

Don't get me wrong: MRMIP needs help and resources as soon as possible--AB2(Dymally) is a longstanding pending bill on this subject that Health Access California supports.

But the real solution is to reduce the number of people denied by insurance companies in the first place, either through the market power of group coverage, or by significantly regulating the individual market. Even in the context of health reform that does both, like in AB x1 1, it made sense to maintain and improve the high-risk pool to make sure the safety net was in place and strengthened for those who fall through the cracks.

What makes no sense is to make the problem worse, and pretend these already struggling problems are the solution.

Labels: Federal, GuaranteedIssue, Insurers, InTheNews

posted by Anthony Wright | Permalink | 7:02 PM


 

Evidence for Reform

Thursday, June 12, 2008

A national report released today confirms what many health advocates already knew: California's individual health insurance market is a big mess.

The individual market is where consumers to go buy health insurance if you don't get it at work (where you have a group going in to buy coverage together and spreading out the risks) or through public programs.

California's feeble -- or lack -- of protections leaves consumers extremely exposed. Here's how we fared:

• Requiring insurers to sell coverage to all applicants (also called guaranteed issue): No Credit.
• Requiring affordable coverage alternatives for uninsureables -- people with pre-existing conditions: Partial Credit. (California has the Managed Risk Medical Insurance Program, which allows this population to buy coverage at above-market rates. Without this program, these consumers would be denied coverage. MRMIP, however, is unable to accommodate all who need coverage. They do not advertise, yet have 8,101 enrollees and 339 applicants on a waiting list.)
• Prohibiting higher premiums based on health status: No Credit.
• Requiring advanced review of proposed premium rates: No Credit.
• Requiring insurers to spend at least 75% of premiums on health care: No Credit. (Actually, HMOs in California are required to spend at least 85% of premiums on health care. PPOs, which are regulated by a different department, are required to spend 70% of premiums on health care, though some insurance products spend as little as 51% on health care)
• Limiting how long coverage can exclude pre-existing conditions: Partial Credit.
• Limiting look-back period: Partial Credit
• Using objective standard to define pre-existing conditions: Full Credit (the first!)
• Requiring medical underwriting to be completed during application: Full Credit (We're not completely convinced this is the case -- otherwise, why the need for some insurers to rescind insurance later?)
• Reviewing insurers' requests to revoke coverage: No Credit (The Department of Managed Health Care Services has restored coverage to more than 1,000 patients and is in the process of reviewing more than 5,000 cases where patients have had their insurance revoked since 2004. )
• Accepting appeals when coverage is revoked: Full Credit
• Reviewing denials for all state-licened carriers: Full Credit
• Making external reviewer decisions binding: Full Credit
• Offering free external reviews regardless of claim size: Full Credit

Pretty sad. But there's hope! Fortunately, we're actually trying to do something about our abysmal performance.

• SB 1522 (Steinberg) INSURANCE MARKET STANDARDS & PREVENTING "JUNK" INSURANCE. The bill would set a minimum benefit standard for coverage, and weed out "junk" insurance that still leaves people exposed to bankruptcy. It would require coverage to have an overall cap on out-of-pocket costs, and cover doctor, hospital, and preventative care. It would sort health insurance policies into five coverage categories, ranging from “comprehensive’’ to “catastrophic.’’ Organization of plans into these categories would enable consumers to better track premium, benefits and cost-sharing, and assist consumers in making apples-to-apples comparisons between plans.
• SB 1440 (Kuehl) CAPPING ADMINISTRATION AND PROFIT. It would set a minimum medical loss ratio – requiring every insurer to spend at least 85 percent of premiums on patient care.
• AB 1945 (De La Torre) INDEPENDENT REVIEW OF RESCISSIONS. It would require health plans to seek approval by an independent review panel under the Department of Managed Health Care or Department of Insurance for each individual rescission. It would also standard the process and questions used in any underwriting. Also up in the Assembly is AB 2549 (Hayashi) that would impose a six-month time limit in which insurers have to rescind individual health care policies once consumers’ applications are approved.

Labels: GuaranteedIssue, Insurers, Legislation, Rescissions, Research, YearOfReform

posted by Hanh Kim Quach | Permalink | 11:49 AM


 

Pretty soon, the insureable will be a pretty exclusive club

Wednesday, June 04, 2008

The NYT had an interesting story on Sunday about women, of childbearing age, who are denied coverage on the individual market because they had previously had a Caesarean section. The rationale is that these women would be likely to have another expensive C-section should they get pregnant again.

If that were truly the case, most of the women I know who have had children would not be able to get coverage on the individual market, which seems horribly unfair -- as the story, and my friends point out -- many women don't go into labor wanting to have a C-section.

"Insurers are adding insult to injury. Not only are women feeling pressure
to have Caesareans that they do not want and may not need, but they may also be
denied coverage for the surgery.''

So women: If you haven't already been excluded from coverage for a rash, prescription, infection or allergy, having a baby will do it to you.

Labels: GuaranteedIssue, Insurers, InTheNews

posted by Hanh Kim Quach | Permalink | 1:54 PM


 

But can Mrs. MIP get coverage?

Friday, May 02, 2008

With all the talk about the high-risk pools that McCain plans to create, it's a good thing to simply highlight that California already has a high-risk pool, even few people know about it.

It's called MRMIP, the Major Risk Medical Insurance Program.

It has a waiting list of over 500 people right now, according to a chart posted on its website. That's even though the program has never been promoted or advertised.

People who are denied coverage because of "pre-existing conditions" have to pay more than the market rate to get the coverage. It's a lifeline for those who can't get coverage any other way, but it's expensive, and has drawbacks.

The plans offered have a $75,000 overall annual cap on benefits (here's a report on the MRMIP benefit), leaving people with that coverage at risk to significant medical debt, if they happen to be sick.

There's a bill, AB2(Dymally), that Health Access California supports, to reform the program, including getting it more funding so it can provide a better benefit to more people. Its parked from last year, but without full "guaranteed issue" health reform, this issue will continue to be with us.

Labels: GuaranteedIssue, Insurers

posted by Anthony Wright | Permalink | 12:00 AM


 

Heartburn by Blue Cross

Tuesday, June 26, 2007

I spoke in front of Congress of California Seniors today at their 30th Anniversary Convention in Long Beach, and got a laugh in my presentation by saying off-hand that "living over 50 is a pre-existing condition." But the truth may be worse...

Last week, in response to my op-ed about young graduates falling off of coverage, I got an E-mail from a 27-year old Ph.D. student denied for Blue Cross' "Tonik" product, because of a high cholesterol test.

Today, health policy-obsessed blogger Ezra Klein posts a letter to Blue Cross by a 28-year old denied for coverage for the pre-existing condition of... heartburn.

(In a similar vein, Lt. Governor John Garamendi also spoke today, and lambasted Blue Cross of California as a "lying bunch of thieves.")

Labels: BlueCross, GuaranteedIssue, Insurers, OtherBlogs

posted by Anthony Wright | Permalink | 8:03 PM


 

Gov spends QT with insurers

Monday, June 25, 2007

Gov. Arnold Schwarzenegger told health insurers, "I need you,'' Friday at the industry's convention in Las Vegas.
Noteably, he said he wouldn't support a system where insurers would "go away'' -- a not-so-veiled reference to SB840 (Kuehl), the Legislature's universal, single-payer legislation.

Another thing Arnold said that irks health advocates:
"My plan also reforms some of the state's regulation that now stand in the way of your industry being able to offer lower-cost products to employers and individuals.''
The Translation: Let's get rid of "pesky mandates'' like mammograms and other cancer screenings, preventive care for children, treatment of osteoporosis. If we don't cover health care, health coverage will be cheaper.

The guv also said that while he didn't support "artificial means'' to bring down costs, he believes plans need to play a role in being "efficient, cost-effective, and focused on quality." This emphasis on efficiency and quality -- and insurers reponsibility to assure that -- goes further than what the guv said in January when he unveiled his health reform plan.

Lastly, the guv praised a number of health plans EXCEPT Blue Cross, who are "on board'' with his notion that people shouldn't be denied coverage because of pre-existing conditions. Blue Cross has put $2 million so far into defeating health reform efforts in the state -- which obviously is annoying the gov.

Watch his remarks and read the transcript here.

Labels: BlueCross, GuaranteedIssue, Schwarzenegger, YearOfReform

posted by Hanh Kim Quach | Permalink | 1:07 PM


 

But will they lobby on it?

Tuesday, June 05, 2007

The National Federation of Independent Businesses (NFIB), which made significant membership gains actively opposing President Clinton's health reforms in the early 1990s, released some responses from a membership survey, which had predictably skewed questions and predictably skewed answers, with a remarkably consistent 68-70% of respondents opposed to anything: HMO consumer protections (called "mandates on small businesses"), an individual mandate, even a subsidized pool for those who can't afford coverage.

The one response that wasn't predictable:

"...on whether or not the state should require health insurers to issue policies regardless of pre-existing medical conditions: A little more than half, 54%, said, ‘Yes,' 32% said ‘No,' and 14% were undecided."

Even this crowd, responding to a less-than-friendly question, thinks that there is a bigger role for the state to oversee the insurers.

Labels: Employers, ExpandingCoverage, GuaranteedIssue, IndividualMandate, Insurers, YearOfReform

posted by Anthony Wright | Permalink | 12:20 PM


 

More fact-checking, from Fresno to Albany...

Thursday, May 24, 2007

Another study that explodes BlueCross' stunning assertion about the "affordability" of the California individual insurance market.

Bottom line: If you are 20 and never had a health issue ever, you can probably get a good deal in California. But if you are older and/or and in less-than-perfect health, California becomes less "affordable," quickly. In New York, with guaranteed issue, access to coverage is ensured, and the standard rate for a comprehensive package may be more expensive for some, it is less expensive for others.

The study: A national study in 2001 by the Kaiser Family Foundation, authored by Karen Pollitz and Richard Sorian at Georgetown University, and Kathy Thomas, had seven hypothetical applicants, from a 24-year old waitress with hay fever, to a 36-year old with knee surgery 10 years ago, to a 48-year old breast cancer survivor, apply for insurance. They applied to 19 insurers and HMOs in eight markets, including Fresno, California.

The result: Only 10% of application were accepted as "clean" offers--35% were either rejected, and over half (53%) were offered with a premium increase or a benefit limit.

The California conclusion: Carriers in Fresno (and Indiana) had more frequent rejections and premium surcharges than insurers in other markets. On average, applicants were offered coverage only about half of the time in Fresno, compared to about two-thirds of the time in other communities. Applicants in Fresno had surcharges apply 58% of the time, compared to 25%-39% in the other markets.

So any "rate" listed for California ignores how many people are rejected, and how many get a different and higher rate, due to their age and health status.

Comparison with New York: Blue Cross also slams guaranteed issue states, including New York, for having the highest rates in the nation. As a born and bred New Yorker, I hate to break it to them--everything, including insurance, costs more in New York.

But from this study, the hypothetical consumers applied for health insurance in Albany, New York--all got coverage. They all would have been sold a standard policy at a standard rate without any exclusion riders or other coverage penalties for their health conditions. The average premium for our single applicants in Albany was $4,104 per year--only slightly higher than the average premium ($3,996 a year) quoted to many applicants in less regulated markets.

In short, costs in New York, with "guaranteed issue" and "community rating" were similar to those in unregulated states, on average (recognizing that in other states, some paid more and some paid less). But everybody had access to comprehensive coverage, which is not the case in California, despite what BlueCross says.

Labels: BlueCross, GuaranteedIssue, Insurers, OtherStates, Research

posted by Anthony Wright | Permalink | 3:44 PM


 

After the slightly off-color joke about Paris Hilton...

Governor Schwarzenegger revisited The Tonight Show last night, where he was introduced as "easily the most popular Republican in the entire country," a phrase that has a bit more edge than Jay Leno is known for.

After suggesting that Jay Leno's proposed 60th birthday idea of having a registered nurse jump out of a bran muffin was "kinky" (will CNA respond?) and admitting to watching all of Paris Hilton's "movies," the Governor talked about health care.

Labels: GuaranteedIssue, IndividualMandate, Insurers, InTheNews, Schwarzenegger

posted by Anthony Wright | Permalink | 12:21 AM


 

Obama's speech on Health Care

 

Dept. of Silver Linings...

 

Veep Debate Fact Check

 

Economy and Health Care and Jobs

 

The VP's on health care...

 

Save the Date! November 20th

 

Why the ERISA Ruling in San Francisco is a Big Dea...

 

Obama's health plan covers more uninsured

 

Still fuming...

 

This is John McCain on taxpayer-funded health care...