Health Access WeBlog

The debate on SB1522(Steinberg) is reported in today in The Los Angeles Times by Nancy Vogel, along with other bills of note.

It's getting attention online as well: Frank Russo at the California Progress Report, without our urging, spotlights SB1522 (Steinberg), which is up for reconsideration today.

The argument that insurers are using is that the bills would eliminate low-cost products. That's untrue--it leaves lots of options, including high deductible products in place: in fact, the bill explicitly categorizes plans into five tiers, expectation that their will be continue to be a wide variation and range in insurance products. But it better labels those products so people are clear what they are getting.

But in doing that categorization, there some choices that may provide so little coverage that even the lowest rating isn't appropriate. Requiring hospital, doctor, and preventative care is a pretty low standard--but would phase out only a handful of products that are "hospital-only coverage."

But is it really "health coverage" if it doesn't cover 80% of all surgeries? Yet that's what hospital-only coverage does (or doesn't) do. This may have made sense 30 years ago, when the vast majority of care was inpatient. But medicine has changed, most surgeries and other care is outside of a hospital. People pay premiums but only get a false sense of security.

Does anybody benefit from such a policy that covers so little care, other than the insurer that collects the premium? We wouldn't allow car insurance to cover only accidents with red cars. Why certify coverage that only covers patients in one setting, but not another?

That's why the bill is actively supported by prominent groups representing low-income families, like ACORN, Western Center on Law and Poverty, and Having Our Say, a coalition of groups representing communities of color, including California Pan-Ethnic Health Network, Latino Issues Forum, and others. It's these groups, not the insurers, that are looking out for low-income and Latino Californians, by supporting SB1522(Steinberg).

Labels: Insurers, Legislation, Steinberg, Underinsurance

posted by Anthony Wright | Permalink | 12:21 PM

The Riverside Press-Enterprise this week had an editorial called "Health Stumble'' bemoaning Sen. Sheila Kuehl's SB1440, which would require all health insurance offered in the state to spend at least 85% premiums on providing health care -- that is physical exams, surgery, mammograms -- you name it. SB1440 is now awaiting concurrence on the Senate Floor -- thank goodness.

They cite a Rand Corp. study which *only* looked at health plans regulated by the Department of Managed Health Care. Those health plans are not allowed to spend more than 15% on administration (of course, that doesn't count profit, but at least it's a target). But, as we know, health insurance plans in California are regulated by two agencies -- DMHC *and* the Department of Insurance.

Until a couple of years ago, some plans at the Department of Insurance (ahem, Blue Cross) spent as little as 51 cents for ever premium dollar on health care. (This we gleaned from a DOI powerpoint presentation at a public hearing). Meanwhile the company would spend 23 cents of every dollar consumers pay to use against consumers -- fighting bills for patient services, scouring health records in order to retroactively rescind policies, and other administrative costs. The remaining 27 cents is reserved for profit and executive bonuses.

That was changed and the DOI now requires that health plans spend at least 70% of their premiums on providing health care -- but that's still far short of 85%.

The Press-Enterprise argues that "medical loss ratios'' don't really tell us much about the plan's efficiency or quality of care. True -- but right now, we have *nothing*.

In an information void, such as the one we have now, the percentage of premium dollars spent on patient care is an important (though not the only) measure of a plan’s value. Unfortunately, low-value products (like the ones offered at DOI) are marketed to consumers for their low premiums. Patients do not have the actuarial expertise, or information to assess whether a particular low-premium product will actually provide them value – meaning it would pay for physician visits, drugs and other health costs when they need it.

Products that have low medical-loss ratios often:

do not have maternity coverage,
do not cover prescription drugs,
have high deductibles,
high co-insurance, and
lack caps on how much consumers need to spend out-of-pocket for their illnesses.

Such flimsy coverage causes consumers to deter care, or leaves them saddled with medical debt. And that's a stumble.

Labels: Kuehl, Legislation, MedicalDebt, Underinsurance

posted by Hanh Kim Quach | Permalink | 1:48 PM

While Senator Steinberg was being sworn in as the new President Pro Tem on the Senate side, and calling for “health access for every Californian,” insurance company lobbyists were actively attacking Senator Steinberg’s health care bill, SB1522, on the Assembly side.

Without a strong case to make, they are resorting to mischaracterizations of the bill, hoping nobody pays attention to the facts in the heated last days of session.

The bill is modest but meaningful. It would ensure that consumers have more confidence in their coverage, and that they know what they are getting when buying coverage as individuals.

Right now:
· It’s impossible to make price comparisons, since each plan from insurer has different deductibles, co-pays, out-of-pocket maximum, benefits, or networks.
· It’s hard to know what a plan covers, or doesn’t cover, or how comprehensive any given plan is.
· Some consumers think they are well covered, and find out they are not only when it is too late. Some plans are marketed as quality coverage but actually cover only hospitalization, but not surgeries, outpatient treatments, or doctor’s visits. (It would be like having car insurance, but only for accidents with red vehicles.) Some plans leave consumers with significant gaps in coverage, sometimes with unlimited exposure to medical bills.

SB1522 (Steinberg) does the following:
* Requires health insurance to cover doctors, hospitals, and preventive care
* Requires all health insurance to have a maximum out of pocket cost.
* Categorizes all health insurance into five categories so that consumers can know whether they are buying comprehensive coverage with low cost sharing or a high deductible, catastrophic policy. It allows for "apples to apples" comparison.

Contrary to the misrepresentations of Blue Cross and other insurers, here is what SB1522(Steinberg) does NOT do:
- SB1522 (Steinberg) does NOT eliminate so-called “low cost”, low premium products with high deductibles. In fact, that’s why there are five categories, so that those products are better labeled.
- SB1522 (Steinberg) does NOT require all health insurance to cover specific benefits. There are other bills: AB1962 DeLaTorre requires maternity coverage, for example.
- SB1522 (Steinberg) does NOT force people to leave the coverage they have. Anybody with a current plan can renew it indefinitely.

These mischaracterizations and misrepresentations show why we need the bill: Just as consumers are rightfully skeptical about their insurance policies and what’s in the fine print, legislators should be skeptical of the claims of the insurance companies. The point of this bill is to give consumers more confidence that their coverage will be there for them when they need it. I am not sure there’s a legislative remedy for the representations of insurers in the halls of the Capitol.

Assemblymembers should join key organizations, including Health Access California, AARP California, ACORN California, AFSCME, CALPIRG, California Teachers Association, Congress of California Seniors, Community Health Councils, Consumers Union, Having Our Say, Jericho, Latino Issues Forum, MALDEF, MS Society, Planned Parenthood, SEIU, Small Business Majority, and Western Center on Law & Poverty in supporting SB1522(Steinberg).

Labels: Insurers, Legislation, Steinberg, Underinsurance

posted by Anthony Wright | Permalink | 8:41 AM

I was pleasantly surprised, this week, by my periodic email from HSA Weekly. Usually, the publishers of this news compendium of Health Savings Account news send out articles intended to promote Health Savings Accounts and their crummy high-deductible health plans.

But this week, I got an article about how HSAs aren't doing all that well because consumers have been rightly wary of them.

The article sums it up well, but essentially, health care is a very complex system to navigate. The idea that "consumer choice'' and "cost-conscious'' behavior is going to drive down costs is ludicrous when you consider that:

a) the most expensive care (ie. emergency care) is not voluntary, nor do you have time to make "cost conscious'' decisions about which hospital you should go to when you're having a heart attack.
b) it's impossible to find price stickers on the care that we need
c) consumers aren't medical experts and don't know what care is most effective and less effective
d) "choice," as proponents of high-deductible plans like to promote, is not neccesarily a good thing. Think of how overwhelming it is to choose a flavor at Baskin Robbins.

Labels: CostContainment, Underinsurance

posted by Hanh Kim Quach | Permalink | 2:36 PM

Assembly Appropriations Committee, chaired by Assemblyman Mark Leno, is meeting as we speak. Here's some of the bill that are being passed, and are heading to their second floor vote:

* SB840(Kuehl), to establish a single-payer universal health care system, and set up a commission to work out the financing, was passed, with amendments to adjust timing issues.

Other bills passed include:
* SB973(Simitian) to facilitate county-based public health insurers to work together;
* SB981(Perata) to prevent balance billing;
* SB1198(Kuehl) to require insurers to offer coverage of durable medical equipment;
* SB1440(Kuehl) to require a minimum level of premium dollars to go to patient care;
* SB1522(Steinberg) to provide standards for individual insurance products;

More information to come...

Labels: BalanceBilling, Insurers, Legislation, SB840, Underinsurance

posted by Anthony Wright | Permalink | 3:10 PM

How do we reduce emergency room overcrowding and waiting times?

Certainly, people have pointed to reducing the ranks of the uninsured, who lack primary care and end with worst health conditions as a result; and to prevent budget cuts, that threaten some ERs directly, and the coverage and benefits and clnics that help people avoid the ER in the first place.

But to follow-up on Hanh's post about the new study on Emergency Room use, there's another important solution that needs to be in the mix as well: make sure the insured get timely access to care.

Here's Victoria Colliver's article in the San Francisco Chronicle:

"...What's new is the rise ... in frequency in visits, and that's occurring in the insured," said Dr. Stephen Pitts, author of the report and a CDC fellow who teaches emergency medicine at Emory University's School of Medicine.

Pitts said the difficulty in getting primary care appointments could be contributing to the rise in emergency room use, particularly by those with insurance or on government programs such as Medicare or Medicaid.

"The likely cause is there are just fewer and fewer primary care physicians," he said. "If you were to get the flu and your doctor says, 'Sure, I'll see you in two weeks,' you may not be able to wait. It's hard for even insured people to get quick appointments and be seen quickly."

Under managed care plans, people agree to a limited network of providers with the assurance that that network has enough doctors, hospitals, and specialists to provide timely and appropriate care. The state Department of Managed Health Care (DMHC) is charged with ensuring that there is "network adequacy" and people are able to get "timely access" to care.

There is currently a stakeholderregulatory process at DMHC to implement standards for timely access, as required by AB2170(Cohn). Health Access California, the sponsor of that bill, along with Western Center on Law and Poverty, California Pan-Ethnic Health Network, and other organizations, are representing consumers against many, many provider groups.

We hope the resultion will not only ensure that people get timely access to care... and in turn, help with the ongoing issue of ER overcrowding.

Labels: DMHC, TimelyAccess, Underinsurance

posted by Anthony Wright | Permalink | 11:27 AM

Proponents of these deplorable Health Savings Accounts say they like them because consumers can take matters into their own hands in lots of ways: you can "shop around'' for care (although, I'm not sure how we do this when we don't have cost and quality transparency, yet) and you can save for health expenses in retirement.

A new EBRI study takes on the latter point head-on. Their research shows that consumers contributing the maximum to their HSAs (plus catch-up) will only have saved between 16 percent and 33 percent of what they will *actually* need in retirement to cover health expenses.

The study assumes that Medicare will cover half of what a person needs in retirement (about $376,000). With an HSA, an individual would accumlate $59,000 over 10 years (with the catch-up deposits).

A man with average health expenses and an average life span would need to have saved $132,000 to cover drugs, premiums and other out-of-pocket expenses in retirement. That's more than twice what could be saved under the HSA. And that's assuming he's average and dies on time. If he lives longer, he'd need $266,000 -- 4.5 times more than is in the HSA. In the most expensive scenario, he lives a long time with LOTS of health care needs -- he'd need $555,0000.

Women have it even worse since we live longer. A retiring woman would need $181,000 to cover drugs, premiums and other out-of-pocket expenses in retirement. A woman who lives beyond the average life span, and incurs higher than average health costs needs $654,000. Add to this the gender wage gap and......

It's unclear to me whether the savings projections EBRI takes into account the fact that consumes with HSAs will likely be using a chunk of the money they invest in the account because a prerequisite to having and HSA is being underinsured. Bush Administration rules require that consumers must be insured only by a high-deductible health plan (a deductible of *at least* $1,100) in order to open such an account. You also can't save more than the deductible, so......

Seems like a bad deal all around:
* You can't shop around
* You have a crummy health plan
* You're *still* broke in retirement.

Don't sign me up for that one.

Labels: MedicalDebt, Research, Underinsurance

posted by Hanh Kim Quach | Permalink | 12:21 PM

Health reform continues, and the first job is to make coverage provide the security for which people get insurance in the first place. That's the upshot of the front-page article today by Jordan Rau of the Los Angeles Times.

It is a good, comprehensive report about several consumer protections moving through the Legislature and to the Governor's desk, which would in particular help those who don't have group coveragae through an employer or public program, and have to buy coverage as an individual. The Governor is currently negotiating with the legislators about the final contents--from SB1522(Steinberg), our bill to better standardize the insurance market, to SB1440(Kuehl), which would ensure a percentage of premiums go to patient care.

It's critical to future efforts around health reform: if people don't have confidence in the value of coverage, then they are less enthused about expanding that coverage.

Labels: Insurers, Legislation, Schwarzenegger, Underinsurance, YearOfReform

posted by Anthony Wright | Permalink | 1:46 PM

The National Federation of Independent Business this week unveiled their campaign to promote health reform from a business perspective. What I really liked was their "Faces of the Healthcare Crisis,'' a compilation of stories/testimonials of small businesses struggling with health care costs. The stories, not surprisingly, sound a lot like some of the consumer stories we get.

One guy, whose employees largely receive health care through their spouses, did not have insurance of his own. When he had chest pains, he delayed going to the ER. When the pain became excruciating, he finally relented and found he was having a heart attack, leaving him with $200,000 in hospital bills.(!!) Sounds like something out of our story database: uninsured, delayed care, high hospital bill.

We certainly empathize with many of the small businesses who want, very badly, to provide health care for their workers. It's expensive, and we have bills that can help:

Transparency (a la AB 2967 - Lieber, and which NFIB is supporting) allows health care buyers can gravitate toward providers that are effective and efficient.

Standardizing and organizing the individual market, a la SB 1522 (Steinberg), would cap out-of-pocket costs, ensure that every plan has doctors, hospitals, and preventive care. This would help give small businesses, who are worried about how much their workers can afford, more peace of mind.

Public insurer (SB 973 - Simitian) would allow small businesses to buy coverage from a public system that competes for business with private companies.

Anti-rescission (AB 1945 (De La Torre) and various other bills) would make harder for insurance companies to yank coverage from paying policy holders willy nilly.

Of course, (here's our 'I told you so' moment) what would have *really* helped was the 1993 Clinton Health plan, which was defeated with lots of help from NFIB. Through Clinton's plan, smaller businesses would have only had to pay up to 3.5 percent of payroll costs toward healthcare rather than the 20-plus percent they are now paying in a virtually unregulated market.

Labels: Employers, Underinsurance, Uninsured, YearOfReform

posted by Hanh Kim Quach | Permalink | 1:35 PM

High gas prices, a sputtering economy, global food shortages the obesity epidemic and countless other apocryphal trends make the headlines and have spurred interest in locally grown goods, farmers markets and "Slow Food" (I'm still trying to figure out what the heck that is.)

I really love food. I love the farmers' market. I plan my weeks and weekends around the farmers market. I feel really fancy, wholesome and healthy buying my food directly from the Hmong and Latino farmers, and I prefer the taste of farmers' market food to Safeway (sorry, Steve Burd.) But the small family farmers who are raising goats, planting tomatoes and picking cherries are doing this at risk to their own financial well being and health. The Boston-based Access Project recently published a paper about the health care burdens that California's farmers face.

Farmers tend to be wealthier than the average citizen and are more likely to be insured. On average, they spent nearly $9,000 annually on premiums and out-of-pocket expenses, which constitutes between 9 and 44 percent of the family's income. High health care expenses:

Made it hard for farmers to pay other bills;
Meant farmers delayed investments in their farm;
Took time off farming/ranching.

According to the report author, Carol Pryor, "The survey shows that most farmers and ranchers are trying to do the right thing by getting coverage, but they aren't finding products in the (individual) market that are affordable and that provide them with financial protection if they get sick. This is a case of product failure.''

If not for moral reasons, wouldn't the like-minded food obsessed want to keep our farmers healthy?

I'll do a quick shameless plug for a few of our bills here that would start us down the track of easing health care burdens for farmers:

SB 1522 (Steinberg) would organize the individual insurance market, where family farmers need to buy their coverage, and establish a minimum benefit package that includes doctors visits, hospitals and preventive care;
AB 2967 (Lieber) woudl require insurers and healthcare providers to provide better data on the cost and quality of care, and create pressure to drive down rapidly escalating health care costs;
SB 973 (Simitian) would create a public insurer that would enable farmers to buy in to a system that is publicly run and competes with private insurers;
Rescission bills (AB 1945, AB 1150, AB 2549 and AB 2569) rein in the insidious insurer practice of retroactively cancelling coverage of people who have been paying premiums and believed they were covered.

Labels: ExpandingCoverage, Research, Underinsurance, Uninsured, YearOfReform

posted by Hanh Kim Quach | Permalink | 11:32 AM

Last week had a startling article by Julie Appleby at the USA Today about the result of a 36-state investigation of HealthMarkets, resulting in a $20 million settlement, for duping lots of health care consumers into buying substandard health coverage.

The investigation, prompted by numerous complaints, found that insurer HealthMarkets failed to properly train its sales agents, who didn't always fully disclose the limits of its health policies to consumers and sometimes did not pay for medical services promptly.

HealthMarkets, owned by three private-equity firms including the Blackstone Group, has about 612,000 policyholders in 44 states through its subsidiaries: Mega Life and Health Insurance, Mid-West National Life Insurance and Chesapeake Life Insurance.

The company sells an array of plans, many of which pay only limited amounts toward medical care. The settlement follows the January release of the investigators' findings, which covered company practices from 2000 to 2005.

"The severity of their actions certainly warranted that level of penalty. They hurt a lot of people," says Washington Insurance Commissioner Mike Kreidler, whose state and Alaska led the investigation. Since 2002, HealthMarkets has been fined by at least seven states and faced lawsuits from dozens of policyholders.

There has been lots of commentary on the web about these practices, and these products--at sites like Managed Care Matters, and The Health Care Blog which includes a report that these insurers and issues are active in California.

Recently, the Sacramento Bee profiled a story of a couple that got snookered into buying "junk insurance" by one of the companies listed above. That article, spotlighted the pending SB1522(Steinberg), sponsored by Health Access California, as a legislative remedy, to begin to address this troubling issue.

Labels: InTheNews, Legislation, OtherBlogs, OtherStates, Underinsurance

posted by Anthony Wright | Permalink | 12:50 AM

This month's issue of Health Affairs contains two academic studies about the impact of consumer-directed health plans on consumer behaviors: one about CDHPs and drugs, and the other specifically about health service seeking behavior.

The papers examined whether such plans would make consumers more "cost conscious'' as proponents alleged they would. The evidence, so far, is: not really in a good way.

In the drug article, consumers were no more likely to seek out generics to save money. However, consumers with higher deductibles were two to three times more likely to skip or stop using high blood pressure, asthma and cholesterol drugs.

In the other article, consumers who weren't already really involved in seeking out information about their health treatments weren't going to be significantly more interested once they enrolled in these plans, however, those in high-deductible plans were a teensy bit more likelyto be more engaged than those in traditional plans.

What I found interesting about both studies was they compared behaviors of consumers in low- and high-deductible plans. As expected, consumers in high-deductible plans immediately ratcheted down their health consumption -- lowering drug doses and skipping doctors visits to save money. But by the second year, even consumers in lower-deductible consumer-directed plans started delaying and forgoing care.

These studies, quantifying and examining real consumer behavior in response to these health plan creations will be an important piece as we proceed with reform on the state and national level -- with some (not us) pushing for more consumer-directed involvement.

Labels: Research, Underinsurance

posted by Hanh Kim Quach | Permalink | 1:09 PM

The Sacramento Bee just posted this Hospital charge database of the 25 most common procedures by hospital. The Bee has compiled all the information reported to the Office of Statewide Health Planning and Development in 2006 and put it in an easy-to-use scroll down format.

The charges reflect what consumers would pay if they didn't have insurance -- in other words, the sticker price. Insurance companies negotiate far lower rates.

I'm finding it weirdly entertaining to see how broke I'd be if I ever found myself uninsured.

If I ever needed a hip replacement, it'd cost *as little* as $40,000 at Mercy Hospital in Folsom or *as much as* $1o9,000 at UC Davis Med Center down the street from me.

If I ever got pneumonia, and needed a breathing tube: $362,000 at Mercy San Juan, a whopping $850,000 at Sutter Memorial.

Play with it. Have a heart attack. (Get an angioplasty -- $94,000 at Sutter, $140,000 at UC Davis.) Pass comprehensive health reform so no one gets these sticker prices.

Labels: Hospitals, InTheNews, Underinsurance

posted by Hanh Kim Quach | Permalink | 5:38 PM

NYTimes has a horror story about diabetes and how it creeps up on you and "eat(s) you alive,'' as one doctor described it. In addition to being the leading cause of blindness and amputation, diabetes also affects the afflicted in a myriad other ways from head to toe -- depression, sleep issues, stroke, dental and hearing problems, liver and kidney problems, *paralysis (!)* of the stomach, ulcers, and various sexual problems.

Cases of diabetes are growing -- 8 percent of the US population had it in 2007. And by 2050, it could be 25%, according to the Centers for Disease Control.

I'm fixating on this for two reasons. 1) I'm genetically predisposed to diabetes; my father was diagnosed in his mid-40s. 2) Our insurance coverage trends make it very difficult for people to maintain and keep this perfectly treatable disease at bay.

As more people (not us, mind you) advocate for more stripped down health plans, devoid of disease maintenance, it creates all kinds of barriers to getting the meds and seeing the doctor -- all necessities for a person with diabetes.

I'll do a quick, shameless plug for our SB1522 here, which not only would organize the individual insurance market, but also establish minimum benefits -- such as doctors, hospitals and preventive services. It's one of the ways we could begin to tame the unruly individual insurance market, which has been rapidly degenerating over the past few years.... unless we want a nation of diabetic zombies by 2050.

Labels: Insurers, InTheNews, Legislation, Steinberg, Underinsurance

posted by Hanh Kim Quach | Permalink | 10:34 AM

David Lazarus at the LA Times had an excellent column last weekend about health insurers charging men and women different rates. When Blue Shield and other insurers admit they're charging women higher premiums because they are higher "risks'' (Read: more expensive), they're coming clean about the industry's already discriminatory practices against women. Though, in doing so, it further widens the gap between what women and men pay for health care. Women will wind up spending more, not only to *buy* care, but also to *use* care, as has been the case.

Since the steady increase of high-deductible health plans (and in the absence of stronger consumer protections such as community rating and minimum benefit standards) insurers have been permitted to passive aggressively charge women more based on the fact that women are trying to be conscientious about their health.

A Harvard Medical School study last year found women ages 18-64 with consumer-directed health policies wound up spending 218% more on health care than men. "High-deductible plans punish women for having breasts and uteruses and having babies,'' said Dr. Steffie Woolhandler, one of the authors of the study.

We require various gynecological exams. We need birth control pills (as a result of co-activities with men). Sometimes we have babies (as a result of said co-activities) -- though high-deductible plans don't cover maternity anyway. We go to the doctor when we hurt. We generally seek more preventive care than men. Hmmmm. And I thought I was just being responsible.

A world that allows high-deductible plans to proliferate -- as envisioned by John McCain -- is essentially a world that legitimizes deadbeat insurers, who want to thrust more and more costs onto women in the name of keeping prices low. But for whom?

Labels: Affordability, Insurers, InTheNews, Underinsurance

posted by Hanh Kim Quach | Permalink | 12:00 PM

How confusing and complicated is the individual insurance market? It makes the much-maligned mortgage industry look clear and simple in comparison.

I was reading a recent study in the Journal of Insurance Regulation (Winter 2007) conducted by Michael Wroblewski during his time at Consumers Union, and the comparison came up. From the article:

“The question remains how consumers choose individual health insurance when they are required to assemble the information on the relevant attributes themselves, because they do not have employers or unions acting as intermediaries for this purpose. And, unlike other financial decisions consumers make, such as mortgage products in which the market provides consistent information for standard products (e.g. 30-year mortgages), standardized information for individual health insurance products does not exist; hence, comparative cost, coverage and benefit data is much more difficult to come by.”

Our individual insurance market is like trying to figure out to compare mortgages where different companies had different terms and lengths, and its impossible to compare, with one company selling 27- and 32-year mortgages, another selling 31.5- and 26-year mortgages.

Contrary to those who mis-characterize the bill, SB1522 doesn’t prohibit the equivalent of a 28.5-year mortgage, if some insurer wanted to provide that “creative” product; it just requires that the insurance company offers a standard product—the equivalent of the 30-year mortgage—as a benchmark.

My hope with SB1522 is that we at least get to the place where people have a standard loan that they can compare between plans, that they are appropriately alerted when purchasing “subprime” insurance, and that we set a minimum standard to prevent the “junk” products that are the insurance version of predatory lending.

Obviously, with everything going on in the mortgage and housing crisis, there’s renewed attention whether those disclosures and consumer protections are enough. Yet it would be a major step to even get those basic protections in the individual insurance market.

Labels: Insurers, Underinsurance

posted by Anthony Wright | Permalink | 11:00 PM

Our efforts to reform the individual insurance market got more attention this week, by John Howard in the Capitol Weekly and Aurelio Rojas in the Sacramento Bee, which both profiled SB1522, by Senator Darrell Steinberg, and sponsored by Health Access California.

SB1522 passsed the Assembly Health Committee this week, and is now pending in the Assembly Appropriations Committee.

The Bee has the story of the Mary McCurnin and Ron Bednar of Rancho Cordova, who unwittingly bought a plan that the insurer Mid-West National Life Insurance Company called "definied benefit" coverage.

McCurnin and Bednar said they paid a monthly premium of $600 for what they thought was comprehensive coverage. But in 2002, after she was diagnosed with breast cancer and he had open-heart surgery, they learned otherwise.

Their plan covered only 10 percent of his hospitalization, and the company rescinded her coverage because she didn't disclose on her application that she was given a prescription for an anti-depressant years ago that she never filled.

With more than $250,000 in medical bills, the couple filed for bankruptcy protection and now face the loss of their home.

"Health insurance companies will do everything they can not to cover you," McCurnin said. "Having good (individual) health insurance is a myth."

The wife of the couple was rescinded under that now-infamous practice; the husband got "coverage," but found it covered only 10% of his costs because the benefit was capped. Examples like this inform consumer advocates' deep skepticism about the individual insurance market, and any attempt to expand it, as President Bush and now Senator McCain seek to do.

With little bargaining power, the individual consumer trying to get coverage will be at the mercy of the big insurance companies. SB1522 (Steinberg) tries to set some minimum standards in terms of benefits (doctors, hospitals, preventative care), and to place a cap on out-of-pocket costs. Other bills this year deal with rescission, or making sure than premium dollars go to patient care. All are consumer protections that attempt to make the situation a little more fair in an inherently unfair situation.

Even if all passsed, more reform will be needed. Both stories put this bill in the context of reconstructing health reform.

As the Weekly describes it, "Although the governor's health-care reform plan died this year in the Capitol's political crossfire, critical pieces have been resurrected and are quietly moving through the Legislature. One of the most important--already approved in the Senate and opposed by HMOs--would force health insurers to give consumers uniform, clear and accurate descriptions of their policies to aid comparative shopping."

And in the Bee, Senator Steinberg himself not only makes the clear case for the bill on its merits, and but ends the article making the case that the bill as a foundation for future, and more comprehensive, reform.

"As we move forward to more comprehensive reform in the future, creating confidence that people know what they are buying will be a key element," he said.

Labels: Insurers, InTheNews, Legislation, Steinberg, Underinsurance

posted by Anthony Wright | Permalink | 3:17 PM

Anne Eowan, lobbyist for the Association of California Life and Health Insurance Companies, made a marvelous suggestion in Assembly Health Committee.

She was opposing Health Access' sponsored bill, SB1522 (Steinberg), which would do lots of things -- including weed out junk insurance and organize the individual insurance market into five tiers so that consumers would know what they were buying if they bought a five-star plan, versus a one-star plan.

In opposing it, however, Eowan suggested that "more transparency would be good'' and welcomed efforts to have the California Health Benefits Review Board take measurements of the existing individual insurance market.

Luckily, we already have similar language drawn up on that. AB2289 (Chan) -- remember that from 2004? It was vetoed.

Then, though, Eowan's organization, along with her merry band of health insurers, took varying degrees of opposition, opining that having to explain how many enrollees they had in their various plans, what the deductibles, copays, out-of-pocket maximums were, etc. for various plans were, was far too onerous, expensive, burdensome, time consuming, etc.

Nice to see she's had a change of heart.

Labels: Insurers, Underinsurance

posted by Hanh Kim Quach | Permalink | 10:22 PM

75 million adults -- that's 42% of working age adults in the US -- had no insurance or really bad insurance (the kind that makes you pay up the nose anytime you sneeze) in 2007.

That's up from 35% of working age adults that were uninsured or underinsured in 2003, the first time Health Affairs did this analysis. A new analysis -- out today!-- updates the study from five years ago.

Among the findings:

25 million people who were technically "insured'' actually have really crappy insurance (that amounts to one-fifth of the entire "insured'' population)
The number of adults earning between $40k and $60k who were underinsured nearly tripled from 5% to 13%.
The number of adults earning more than $100k and were underinsured (meaning that they spent more than 10% of their income on out-of-pocket medical expenses) increased from 1% to 7%.

The series of studies is important because until recently, most analyses only tracked the number of people without coverage and how lack of coverage impacts a person's ability to stay healthy. Just as important now, though, is this tracking the number of people with inadequate insurance. High deductibles, high co-pays, high co-insurance and high out-of-pocket costs cause patients to behave in similar ways to a person who is uninsured -- they forgo care because of the expense.

Insurance companies like to argue that these low-quality, low-premium plans are at least a backstop to keep people from going into bankruptcy. But as our previous study has shown, people don't have much in the way of assets -- and a $5,000 deductible would wipe out the savings of 40% of Americans. Health Affairs (obviously a nerd's must-read publication) also recently published a study that showed uninsured families earning more than 300% of the poverty level had less than $4,000 in liquid assets. (Here's our blog post on that study).
From our perspective, being underinsured means you're paying premiums to be functionally uninsured. All in all, we don't really buy the insurance company logic on this and think they should be labeled and limited (and the most egregious ones banned) -- as SB 1522 would do.

Labels: Research, Underinsurance, Uninsured

posted by Hanh Kim Quach | Permalink | 11:32 AM

The effort to win national health care reform is heating up: lots of planning meeting and activities to ensure that there is a mandate for a new President and Congress to take this issue on, and to be ready to roll in 2009.

Consumers Union (a Health Access California board member) is spearheading a Cover America Tour: an RV that will criss-cross the country for four months, collecting stories about the issues that people have with the broken health care system.

The effort has a website and blog of interest, which includes a video of the launch of the Cover America Tour from Consumers Union's Yonkers headquarters, being cheered by staffers from the labs that test all those products that are evaluated in Consumer Reports. It should be an interest and informative trip, that I urge folks to follow along on the web.

The video prominently features the energetic Meg Bohne (pictured above, crouching), a Health Access alumnus, who has told me she give us partial credit (or blame) for her current assignment. On the website page that describes the whole enterprise, Meg Bohne cites her experience as a "a seasoned community activist, advocate and organizer, Meg has come to specialize in on-the-road campaigns in vehicles that have spanned a bus, an ambulance and, now, an RV." At left is the ambulance she drove up and down the state of California for Health Access, in the cause of lower prescription drug prices.

We wish Meg and the whole crew at Consumers Union luck in their trip and their effort. We look forward to hearing the stories, the personal health care experiences, and the adventures on the road!

Labels: ExpandingCoverage, Federal, HealthAccessCommunity, Underinsurance, Uninsured

posted by Anthony Wright | Permalink | 2:02 AM

As the Democratic presidential candidates debated whether their "universal coverage" plans were "universal"--and what that meant--there wass surprisingly little debate about the definition of "coverage."

What makes "coverage" coverage?

It's a good question, as Florida Governor Charlie Crist just signed a so-called health reform that doesn't expand coverage one bit, but rather strips down the definition of coverage to make the premium cheaper. Critics say that as insurers water down the benefits, at some point the value of the coverage is so little that it's not worth paying premiums for in the first place.

It seems people get coverage to prevent the real health and financial consequences of being uninsured. They literally pay a premium to 1) get the care they need, and 2) not face financial ruin as a result.

There are some products out there that don't meet this basic definition. For example, we've heard of products--some sold by disreputable outfits, sometimes on TV at 3am--that say they provide hospital coverage, but only reimburse $200/day. Only if you've been to a hospital do you know that such a plan doesn't begin to cover an overnight stay, and that such "coverage" from a masssive hospital bill is merely an illusion. It's "junk" insurance.

SB1522(Steinberg), which passed the California Senate Tuesday, would set a minimum standard for coverage as well, in two basic ways:

* It would set an overall cap on out-of-pocket costs, so people paying premiums would not face unlimited financial liability when they get sick or have an emergency. This won't eliminate your standard high-deductible plans, may be a (not great) option for a healthier, wealthier person who wants to save on the premium and who has the ability to self-insure a few thousand dollars of a deductible. But it would eliminate those plans which cover so little or impose so much cost-sharing on the patient that the person continues to be at risk of banktruptcy.

* It would requires that a plan should include doctor, hospital, and preventative care, preventing hospital-only coverage. This would prevent hospital-only plans that leave patients in a situation where cancer isn't covered, since most of the treatment is in a doctor's office, rather than a hospital. Even worse, you don't want an perverse incentive for people to want the more invasive, more expensive hospital treatment unless they need it. Again, these plans often provide a false security to patients--until its too late.

These "junk" plans, because they collect premiums but are far skimpier in paying out benefits, can be very lucrative for the insurers who sell them. But they have the capacity to undermine the very notion coverage altogether. What's the point of paying for coverage, if you still face financial ruin?

People are growing more and more concerned that their coverage will not be there for them when they need it. They are frightened that even if they are insured, there will some loophole or provision that leaves them with significant medical debt. That's why SB1522(Steinberg) and other efforts are so important, to make the definition of coverage mean something. Consumers with coverage deserve some security that with their premium, they will be protected.

Labels: Insurers, Legislation, Steinberg, Underinsurance

posted by Anthony Wright | Permalink | 11:52 PM

Senator Steinberg just presented SB1522 on the Senate floor. The preliminary count is that it passed, 21-14, largely on party lines.

Senator Cox was the only other speaker, in opposition. An insurance agent, Cox suggested that "Senator Steinberg should find himself a good agent," and that an agent could provide the information to help a consumer decide what coverage to get.

He argued that with the classification of health plans into five tiers, "you've taken away the flexibility" which will lead to a "higher-premium program with fewer enrollees."

In fact, the five tiers allow for lots of variation and flexibility within those tiers. Above some minimum standards (see below), there is total flexibility in benefit design. The tiers will simply provide consumers some guideposts, so they are better be able to make comparisons between insurers.

SB1522 does seek to eliminate some "junk" insurance that leaves patients with unlimited financial exposure, undermining the point of coverage in the first place. Coverage would have to have some overall cap on out-of-pocket costs. The minimum standard for coverage would need to include doctor, hospital, and preventative care, effectively restricting doctor-only or hospital-only health coverage--as if people can guess that not just the type of ailment they will have, but the type of treatment as well.

But other than that, there's lots of flexibility. As Senator Steinberg said in closing, the basic point of the bill is to have clear information. And, he asked, while many people may benefit from "a good broker like Senator Cox," what's the harm in providing everyone as much information as possible? "Information is a good thing, and provides greater flexibility" for consumers.

Labels: Insurers, Legislation, Steinberg, Underinsurance

posted by Anthony Wright | Permalink | 3:43 PM

SB1522(Steinberg), sponsored by Health Access California, is up for a full Senate vote this week.

The bill would standardize the individual insurance market, so that consumers have a better sense of the coverage they are buying, and allow for "apples-to-apples" comparisons between plans. It would create clear categories so that people would have a better sense of how comprehensive their plan was, and would set a minimum standard for benefits to include doctor, hospital, and preventative care, and have a overall cap on out-of-pocket costs. This would eliminate the "junk" insurance that leaves people to believe they are covered but finding out later they have significant financial exposure.

Below is the testimony of Susan Braig (pictured above, with Senator Darryl Steinberg, author of SB1522). With a limited income to pay premiums, she understood she was buying catastrophic coverage... but not that her "hospital only" plan wouldn't cover the significant costs of being treated for breast cancer, because most of those treatments were not in a hospital.

This is a excerpt of her testimony in the Senate Health Committee earlier this year:
I am a self-employed grant writer, whose Stage 2 Breast Cancer has, thankfully, not metasticized, though my credit card debt has.

In 2001, after a year with no health insurance, my 50th birthday sent me comparison shopping, and I went to Blue Cross. I purchased what I considered to be a “catastrophic” policy, their lowest tier, their BASIC PPO 1000. I thought my out-of-pockets costs would be limited to $3,500, comprised of a $1,000 deductible, plus a $2500 co-payment requirement before full coverage kicks in.

Blue Cross made it clear up front, this plan did not cover doctor visits, tests or prescriptions; I rationalized that, since I was healthy and rarely needed a doctor, why sweat the "small stuff?"

The important thing was, Blue Cross said they would cover 80% the big stuff: surgeries, emergencies, and hospitalizations, and with the big stuff, I would quickly spend $3500, and then Blue Cross would pay 100% of my care for the rest of the year.

Prior to my 2004 diagnosis, I assumed fighting a catastrophic disease like cancer involved the big stuff.

* What I didn’t realize then, but I know now, is that during the next 11 years, most of my medical services I would need in my battle with cancer would involve things not covered—specialist exams, ultrasounds, an $8,000 MRI, lab tests, prescriptions.

Even my chemotherapy treatments were considered doctor visits, unless I had the identical treatments an hour from home in a hospital.

* I also didn’t realize that the way deductibles and co-pays are calculated meant they didn’t count any of these non-hospital expenses to meet my deductible, and I would almost never reach my annual $3500 cap, no matter how much I spent.

It’s true that after I met my deductible, Blue Cross did cover 80% of in-hospital services, such as my Lumpectomy and a 3-day emergency hospitalization in 2004… although by the time I paid off my $1000 deductible, my various 20% co-payments fell $30 short of the $2500 co-payment requirement to get full coverage.
* For a time, due to my low income, I got help with the costs that Blue Cross didn’t cover from the state’s Breast and Cervical Cancer Treatment program. That was a lifesaver—even though I was still paying premiums to Blue Cross.

* I still have significant follow-up treatments. In each of the last few years, I have paid out over $5,000 a year in out-of-pocket costs, on top of what I pay in premiums, yet my insurance pays nothing. I expect these treatments—and these costs--to go on for several more years. I already have over $40,000 in credit card debt, mostly stemming from my illness and medical care.

With the ongoing costs of follow-up care, I begin to wonder, "I'm paying insurance premiums for WHAT?"

When people seek coverage, they should know what their options are, and what they are getting. When they have coverage, they should have the confidence that it will actually provide protection against financial ruin and bankrtupcy. SB1522(Steinberg), if it passes the Senate floor this week, will take a major step in providing that clarity and security.

Labels: Insurers, Legislation, Underinsurance

posted by Anthony Wright | Permalink | 9:32 AM

The New York Times had an excellent article this weekend about workers, who have health coverage through work, feeling financially strained.

The reason: businesses - unable to absorb higher health care costs - have decided that workers need to absorb more of these costs. Businesses are buying crappier coverage (this doesn't mean cheaper premiums, just cheaper than more comprehensive plans, but still expensive) and asking workers to pay a greater share of the premium. So not only are premiums for workers increasing, but the plans that they are getting are getting worse, which means higher copays, deductibles, and less coverage.

It used to be that worrying about how to pay for health care happened mostly if you didn't have insurance. Then, it started creeping into the ranks of the insured -- but only those who bought insurance on their own, without the benefit of a group buying in bulk to negotiate lower rates. Now, though, health cost worries are hitting the employer market -- where most Americans get their coverage.

One *insured* worker said he was losing the equivalent of a month's worth of pay with the higher premium and

Saturday session...

Saturday, August 30, 2008

A step forward! NOT a stumble...

Friday, August 22, 2008

Whose side are you on: consumers or insurers?

The new 401(k)s

Friday, August 15, 2008

Key bills move to the next step...

Thursday, August 07, 2008

Dealing with ER overcrowding...

Another reason to pick on HSAs ...

Wednesday, August 06, 2008

Making coverage matter...

Monday, August 04, 2008

If only...

Wednesday, July 30, 2008

Healthy Food

Tuesday, July 29, 2008

Mega problems with mini-coverage...

Keep on harping

Friday, July 18, 2008

Sick, Twisted and Fun

Tuesday, July 08, 2008

Killing us softly...

Wednesday, July 02, 2008

Deadbeat Insurers

Tuesday, July 01, 2008

Mortgage metaphor...

Tuesday, June 24, 2008

Buyer beware, indeed...

Sunday, June 22, 2008

Let's do it, then.

Tuesday, June 17, 2008

An Unhealthy Trend

Tuesday, June 10, 2008

We knew her when...

Sunday, June 01, 2008

What constitutes coverage?

Tuesday, May 27, 2008

The debate on SB1522...

When cancer isn't covered...

Healthcare Armageddon

Tuesday, May 06, 2008