Category Archives: deductibles

The Further Adventures of Ashley Furniture in Medical Travel

Readers of this blog will remember two previous articles I linked to back in October 2017 and November 2017 about the Ashley Furniture Company’s foray into Medical Travel.

Now comes a new article, courtesy of Kaiser Health News, that shows just how American patients are saving money by having surgery in Cancun, Mexico for procedures such as knee surgery (are you listening, Workers’ Compsters?)

Not only are the patients traveling to Cancun, but so are the physicians from the US.  As pictured below, Donna Ferguson, the wife of one of Ashley’s employees, is shown in the hospital in Cancun, along with her doctors, one of whom will be performing knee replacement surgery. As stated in the article, all she had to do was walk out of her hotel, and into the Galenia Hospital through a short hallway.

Donna Ferguson, center, of Ecru, Miss., had no contact with Milwaukee surgeon Dr. Thomas Parisi, left, before meeting him in Cancun the day before he performed her knee replacement surgery. (Rocco Saint-Mleux for KHN)

Donna’s surgeon, Dr. Thomas Parisi, from Milwaukee, had flown to Cancun the day before. To get this surgery, which she was getting for free, she would also receive a check when she got home. (I’ve said this before, but you never listened)

According to the article, the employees of Ashley receive a $5,000 payment from the company, and all their travel costs are covered. They use this option because they have no out-of-pocket copayments or deductibles, so it made financial sense for both a highly trained orthopedist and a patient from Mississippi to leave the US and meet at an upscale Mexican hospital. (Let’s see Trump try to built a wall to stop that!)

Dr. Parisi spent less than 24 hours in Cancun, so no one could accuse him of slacking off to play golf, and was paid $2,700, which as the article stated, was three times what he would have gotten from Medicare. The cost of the surgery for Ashley was less than half of what it would have been in the US.

To understand better, just why Ashley is doing this for their employees and their families, let’s look at what the average knee replacement would cost in the US: about $30,000 — sometimes double or triple that; whereas in Mexico, at Galenia, it was only $12,000. according to Dr. Gabriela Flores Teón, the hospital’s medical director.

The standard charge for the night at Galenia is $300, compared to an average of $2,000 at US hospitals, said Dr. Flores.

But besides the big savings on the surgery, there was also savings on the cost of the medical device, made by a subsidiary of the Band-Aid people, J&J, in New Jersey. The implant cost $3,500 in Mexico, but nearly $8,000 in the US, Flores continued.

In case you WC hotshots were wondering, Galenia Hospital is not some fleabag hospital on the cheap. It is accredited by the international affiliation of the Joint Commission (JCI). They set the standards for hospitals in the US.

However, so that doctors and patients could feel comfortable with surgery, NASH (North American Speciality Hospital) based in Denver, and who has organized treatment for dozens of American patients at Galenia since 2017, along with Galenia, worked to go beyond those standards.

In the two SPOTLIGHT articles referenced above, the manager of global benefits and health at Ashley, Marcus Gagnon said, “We’ve had an overwhelming positive reaction from employees who have gone,”

The company has also sent about 140 employees or dependents for treatments at a hospital in Costa Rica, and together, the foreign medical facilities have saved Ashley $3.2 million in health care costs, said Gagnon. (Wake up, you WC guys! Why are you being so stubborn?)

Gagnon continued, “Even after the incentive payments and travel expenses, we still save about half the cost of paying for care in the United States,” “It’s been a nice option — not a magic bullet — but a nice option.”

So, if Ashley can do it, and if HSM could do it too, the so could you. Not all the hospitals outside of the US are fleabags. Galenia in Cancun is one example. Bumrungrad in Thailand is another, and there are plenty more around the world that cater to medical travel.

The whole point of my advocacy for medical travel and workers’ comp was so that American workers and their dependents like Donna could travel abroad and see what the world is really like, so that political, hate-filled rallies and incidents we are seeing everyday since the election of a white supremacist to the presidency, would not take place.

How else will the American worker learn about the real world beyond his borders if not this way? Certainly not from Fox News.

“Travel is fatal to prejudice, bigotry, and narrow-mindedness, and many of our people need it sorely on these accounts. Broad, wholesome, charitable views of men and things cannot be acquired by vegetating in one little corner of the earth all one’s lifetime.”

― Mark Twain, The Innocents Abroad / Roughing It

 

The Debate Continues

 

The multilateral debating society that is known as the 2019 Democratic Debates has now had four such contests, and in keeping with the previous post, Medicare for All and the Democratic Debates, I want to discuss the issue of health care.

This was the first topic of the evening, and on both nights, it was a contentious, and long debate. The first night saw Sens. Sanders and Warren debating the other eight contenders over Medicare for All versus a public option.

The second night was more of the same, however, only NYC mayor Bill de Blasio argued for full MFA, while Sen. Kamala Harris argued for her plan that would enroll some Americans right away, while taking ten years to fully implement. All the rest, including former V.P. Joe Biden argued for either repairing the ACA, or adding a public option as a Medicare buy-in.

As I will report later in this article, there is a problem with the idea of a Medicare buy-in or a public option, and its impact on the ACA.

But before I do, I would like to discuss a few areas that seem to be missing from the candidate’s talking points on health care that need to be answered, addressed, or clarified. The CNN moderators, as was pointed out at one part of the debate, was questioning the candidates with what were essentially Republican talking points about MFA.

One area that was somewhat glossed over on the first night was the issue of middle class taxes being raised to pay for MFA. MSNBC host Chris Matthews of Hardball questioned Sen. Warren several times after the debate in the spin room on this very subject, yet she danced around the question by talking more about the savings people would receive.

Sen. Sanders agreed with Joe Biden when he said that those pushing Medicare for All without a middle-class tax hike are living in a “fantasy world.” In addition, Sanders said, that he knows middle-class taxes will go up, but maintained that the American people could still end up saving money on the other side.

In a CNN interview with Jake Tapper, Sanders said the following:

“The first thing that we have to understand is, under Medicare for all, similar to what Canada has, people are not gonna pay any premiums. They’re not gonna pay any deductibles. They’re not going to pay any co-payments. So if you call a premium a tax, we’re getting rid of that. But I do believe that, in a progressive way, people will have to pay taxes. The wealthy will obviously pay the lion’s share of the taxes, but at the end of the day, the vast majority of the American people will pay substantially less for the health care they now receive because we’re going to do away with hundreds of billion dollars of administrative waste. We’re gonna do away with the incredible profiteering of the insurance companies and the drug companies. People will be paying, in some cases, more in taxes, but overall, because they’re not gonna pay premiums or deductibles, co-payments, they’ll be paying less for their health care.”

Another area missing from the debates was the issue of what to do about union contracts. Rep. Tim Ryan (OH) made that a point in both debate appearances, and the question still has not been fully addressed, even though Sen. Sanders said he was very pro-union.

Finally, three other areas mentioned in the debates, but that may not have been fully discussed or explained, was the issues of private insurance and employer-based insurance. The third issue, pre-existing conditions was only mentioned in the post-debate analysis from the political pundits. At many times, it was argued by the anti-MFA candidates that those advocating MFA wanted to take away such insurance from over 150 million Americans. But as the following two articles suggest, private insurance and employer-based plans are part of the problem.

As reported by CheatSheet, the Supreme Court decision mandating that a for-profit corporation — in this case, Hobby Lobby — can actually mandate the types of healthcare provisions its employees receive, all based on the religious beliefs of the company’s owners. Hobby Lobby’s arguments were based on a stack of flawed science and misunderstood concepts, and the fact that the Supreme Court ruled that an employer’s particular religious belief — which can be made up off the top off their heads, for all the Court cares — now takes precedent over the medical needs of their employees.

CheatSheet concluded that the case in itself is ridiculous, but it brings us to one important conclusion: The era of employer-sponsored health care needs to end.

Reed Abelson in The New York Times wrote the following article, reprinted here in its entirety:

The New York Times
July 29, 2019
How a Medicare Buy-In or Public Option Could Threaten Obamacare
By Reed Abelson

It seems a simple enough proposition: Give people the choice to buy into Medicare, the popular federal insurance program for those over 65.

Former Vice President Joseph R. Biden Jr. is one of the Democratic presidential contenders who favor this kind of buy-in, often called the public option. They view it as a more gradual, politically pragmatic alternative to the Medicare-for-all proposal championed by Senator Bernie Sanders, which would abolish private health insurance altogether.

A public option, supporters say, is the logical next step in the expansion of access begun under the Affordable Care Act, passed while Mr. Biden was in office. “We have to protect and build on Obamacare,” he said.

But depending on its design, a public option may well threaten the A.C.A. in unexpected ways.

A government plan, even a Medicare buy-in, could shrink the number of customers buying policies on the Obamacare markets, making them less appealing for leading insurers, according to many health insurers, policy analysts and even some Democrats.

In urban markets, “a public option could come in and soak up all of the demand of the A.C.A. market,” said Craig Garthwaite, a health economist at the Kellogg School of Management at Northwestern University.

And in rural markets, insurers that are now profitable because they are often the only choices may find it difficult to make money if they faced competition from the federal government.

Some insurers could decide that a smaller and uncertain market is not worth their effort.
If the public option program also matched the rates Medicare paid to hospitals and doctors, “I think it would be really hard to compete,” Mr. Garthwaite said. Even leading insurers do not have the leverage to demand lower prices from hospitals and other providers that the government has.

Whether to implement a public option or Medicare buy-in has become a defining question among Democratic presidential candidates and is likely to be a contentious topic at this week’s debates.

On Monday, Senator Kamala Harris took an alternate route, unveiling a plan that would allow private insurers to participate in a Medicare-for-all scheme, akin to their role currently offering private plans under Medicare Advantage.

The recent spate of proposals reprises some of the most difficult questions leading up to the passage of the A.C.A., in many ways a compromise over widely divergent views of the role of the government in ensuring access to care.

After a shaky start, the federal and state Obamacare marketplaces are surprisingly robust, despite repeated attempts by Republicans to weaken them. They provide insurance to 11 million customers, many of whom receive generous federal subsidies to help pay for coverage.

The A.C.A. is now a solidly profitable business for insurers, with several expanding options after earlier threats to leave. For example, Centene, a for-profit insurer, controls about a fifth of the market, offering plans in 20 states. It is expected to bring in roughly $10 billion in revenues this year by selling Obamacare policies.

In spite of stock drops because of investors’ concerns over Medicare-for-all proposals, for-profit health insurers have generally thrived since the law’s passage.

But a buy-in shift in insurance coverage could profoundly unsettle the nation’s private health sector, which makes up almost a fifth of the United States economy. Depending on who is allowed to sign up for the plan, it could also rock the employer-based system that now covers some 160 million Americans.

In a recent ad, Mr. Biden features a woman who wants to keep her current coverage. “I have my own private insurance — I don’t want to lose it,” she said.

A spokesman for Mr. Biden argued that a public option can extend the success of the Affordable Care Act.

“Joe Biden thinks it would be an egregious mistake to undo the A.C.A., and he will stand against anyone — regardless of their party — who tries to do so,” said Andrew Bates, a spokesman for Mr. Biden, in an email.

Major insurers and hospital chains, pharmaceutical companies and the American Medical Association have joined forces to try to derail efforts like Medicare-for-all and the public option. Mr. Sanders denounced these powerful interests in a recent speech.

“The debate we are currently having in this campaign and all over this country has nothing to do with health care, but it has everything to do with the greed and profits of the health care industry,” he said.

Other critics of the public option, including Seema Verma, the administrator of the Centers for Medicare and Medicaid Services, argue Democrats’ programs will lead to a “complete government takeover.”

“These proposals are the largest threats to the American health care system,” she said in a speech earlier this month.

Some experts predict that private insurers will adapt, while others warn that the government could wind up taking on the sickest customers with high medical bills, leaving the healthier, profitable ones to private insurers.

It’s uncertain whether hospitals, on the other hand, could thrive under some versions of the public option. If the nation’s 5,300 hospitals were paid at much lower rates by a government plan — rates resembling those of Medicare — they might lose tens of billions of dollars, the industry claims. Some would close.

One variant of the public option — letting people over 50 or 55 buy into Medicare — is often depicted as less drastic than a universal, single-payer program. But this option would also be problematic, experts said.

This consumer demographic is quite valuable to insurers, hospitals and doctors.

Middle-aged and older Americans have become the bedrock of the Obamacare market. Some insurers say this demographic makes up about half of the people enrolled in their A.C.A. plans and, unlike younger people who come and go, is a reliable and profitable source of business for the insurance companies.

The aging-related health issues of people in this group guarantee regular doctor visits for everything from rising blood pressure to diabetes, and they account for a steady stream of lucrative joint replacements and cardiac stent procedures.

The 55-to-64 age group, for example, accounts for 13 percent of the nation’s population, but generates 20 percent of all health care spending, according to the Kaiser Family Foundation.

Health Spending
People age 55–64 are responsible for one fifth of total health spending and account for a sizable share of the private insurance market. People 65 and older are eligible for Medicare and account for one third of total spending.

By The New York Times | Sources: Kaiser Family Foundation; Dept. of Health & Human Services. Data from 2016

Several experts said that designing a buy-in program that is compatible with the existing public and private plans could be daunting.

“You’d have to do it carefully,” said Representative Donna Shalala, a Florida Democrat who served as the secretary of health and human services under President Bill Clinton.
Linda Blumberg, a health policy expert at the Urban Institute, a nonpartisan think tank, agreed.

“The idea of Medicare buy-ins was taken very seriously before there was an Affordable Care Act,” she said. “In the context of the A.C.A., it’s a lot more complicated to do that.”

Many dismiss concerns about whether insurers can compete.

“Any time a market shrinks in America, insurers don’t like it,” said Andy Slavitt, the former acting Medicare administrator under President Obama and a former insurance executive. Mr. Slavitt noted that insurers raised similar concerns about the federal law when it was introduced. “They’ll figure it out,” he said.

In Los Angeles County, five private insurers that sell insurance in the A.C.A. market already compete with L.A. Care Health Plan, which views itself as a kind of public option, said John Baackes, the plan’s chief executive.

The insurer offers the least expensive H.M.O. plan in the county by paying roughly Medicare rates. “We’ve proved that the public option can be healthy competition,” he said.

But the major insurance companies, which were instrumental in defeating the public option when Congress first considered making it a feature of the A.C.A., are already flexing their lobbying muscle and waging public campaigns.

In Connecticut, fierce lobbying by health insurers helped kill a state version of the public option this spring. Cigna resisted passage of the bill, threatening to leave the state. “The proposal design was ill-conceived and simply did not work,” the company said in a statement.

Blue Cross plans could lose 60 percent of their revenues from the individual market if people over 50 are shifted to Medicare, said Kris Haltmeyer, an executive with the Blue Cross Blue Shield Association, citing an analysis the company conducted. He said it might not make sense for plans to stay in the A.C.A. markets.

Siphoning off such a large group of customers could also lead to a 10 percent increase in premiums for the remaining pool of insured people, according to the Blue Cross analysis. More younger people with expensive medical conditions have enrolled than insurers expected, and insurers would have to increase premiums to cover their costs, Mr. Haltmeyer said.

Tricia Neuman, a senior vice president at the Kaiser Family Foundation, which studies insurance markets, said a government buy-in that attracted older Americans could indeed raise premiums for those who remained in the A.C.A. markets, especially if those consumers had high medical costs.

But some experts countered that prognosis, predicting that premiums could go down if older Americans, whose health care costs are generally expensive, moved into a Medicare-like program.

“The insurance companies are wrong about opposing the public option,” Ms. Shalala said.

Dr. David Blumenthal, the president of the Commonwealth Fund, a foundation that funds health care research, said a government plan that attracted people with expensive conditions could prove costly.

“You might, as a taxpayer, become concerned that they would be more like high-risk pools,” he said.

Jonathan Gruber, an M.I.T. economist who advised the Obama administration during the development of the A.C.A., likes Mr. Biden’s plan and argues there is a way to design a public option that does not shut out the private insurers.

“It’s all about threading the needle of making a public option that helps the failing system and not making the doctors and insurers go to the mat,” he said.

Many experts point to private Medicare Advantage plans, which now cover one-third of those eligible for Medicare, as proof that private insurers can coexist with the government.

But the real value of a public option, some say, would stem from the pressure to lower prices for medical care as insurers were forced to compete with the lower-paying government plans, like Medicare.

Washington State recently passed the country’s first public option, capping prices as part of its plan to provide a public alternative to all residents by 2021.

“It’s couched in this language in expanding coverage, but it does it by regulating prices,” said Sabrina Corlette, a health policy researcher at Georgetown University.

The hospital industry would most likely fight just as hard to defeat any proposal that would convert a profitable group of customers, Americans who are privately covered at present, into Medicare beneficiaries.

Private insurers often pay hospitals double or triple what Medicare pays them, according to a recent study from the nonprofit Rand Corporation.

While Ms. Shalala supports a public option as an alternative to “Medicare for All,” she is clear about how challenging it will be to preserve both Obamacare and the private insurance market. “You can’t do it off the top of your head,” she said.

So, let’s see, the Republicans want to kill the ACA, and others want to fix it. But adding a public option, or including a Medicare buy-in, might harm the ACA. On the other hand, it has been shown that both private insurance and employer-based insurance are part of the problem.

The idea that people like their private plans, whether obtained from their employer, or from private insurance companies directly, and is part of the problem is being left out of the discussion.

And debate moderators who ask those questions to candidates are only echoing Republican talking points, or worse, taking their cues from the drug manufacturers and insurance companies.

So if neither fixing ACA, adding a public option, or providing a Medicare buy-in  will solve the enormous complexity and confusion that the broken and dysfunctional health care system represents,  that only leaves one alternative: Medicare for All, while currently not likely to be enacted, nevertheless is popular with the public until the issue of taxes is mentioned.

The moderate candidates, are either defending the drug and insurance companies  because of campaign contributions, or have been part of the health care industry, such as former Congressman John Delaney, and therefore is an unlikely spokesman for progressive change. Let’s hope that he and the other bottom-tier candidates drop out soon, so that perhaps these other issues can be discussed and debated.

How the campaign will turn out, and who the Democrats will nominate is still far off in the future, but who ever is nominated, will have to eventually deal with the reality that health care must be solved, and that the march towards single payer will have already begun.

How much are you really paying for healthcare? – Managed Care Matters

A little Monday evening catch-up from posts received this morning, but was not able to read and relate to you.

The article below from Joe Paduda examines how much we are really paying for health care, and shows in graphic detail how prices have gone up in health care.

Here is Joe’s article:

Recent posts have focused on defining Medicare for All/Single Payer and the problem both are intended to solve – healthcare prices in the US are the problem. Today, we’ll figure out what you really pay for healthcare. That’s pretty darn … Continue reading How much are you really paying for healthcare?

Source: How much are you really paying for healthcare? – Managed Care Matters

What’s all this about Single Payer and Medicare For All? – Managed Care Matters

Once again, my fellow blogger, Joe Paduda hits it out of the ballpark in explaining Single Payer and Medicare For All.

Most of what you hear comes from politicians and a few billionaires, one running for President and one not; one a former barista, the other a former big city mayor.

But there is also a lot of misinformation and wrong information on the Internet, especially on social media sites like LinkedIn, where the professionals in the health care or insurance space spout off their opposition to Single Payer/Medicare For All mostly because it will disrupt their businesses and may even cost them their jobs. But never mind that millions of Americans can’t afford insurance, or have very little insurance to protect them in case of severe illness or disease.

These individuals are not physicians, nor are they executives with insurance companies, or hospitals; but rather, they are consultants and analysts who offer their services to the health care industry.

But not all commenters are in the health care field, many are just average business people or citizens who put their two cents into the discussion threads, without knowing what they are talking about, or without any facts to back up their argument.

One common refrain is that Single Payer/Medicare For All is government-controlled health care. It isn’t, it’s government financed health care, but to their minds, any time the government pays for something, they “control” it.

So, Joe’s article today is sorely need to clear up any misconceptions.

Here it is:

It’s the worst kind of government over-reach. It’s an easy solution to a huge problem that will cost nothing. And everything in between. Between now and Election Day you are going to hear a lot about Medicare for All and … Continue reading What’s all this about Single Payer and Medicare For All?

Source: What’s all this about Single Payer and Medicare For All? – Managed Care Matters

Employer Insurance Costs Growing Burden for Middle Class

The Commonwealth Fund today released a report that stated that the cost of employer-based insurance is a growing burden on middle-class families.

In 2017, more than half (56%) of people under age 65, about 152 million people, had insurance through an employer, either their own or a family member’s. In contrast, only 9 percent had a plan purchased on the individual market, including the marketplaces.

Here are the highlights from that brief:

Highlights

* After climbing modestly between 2011 and 2016, average premiums for employer health plans rose sharply in 2017. Annual single-person premiums climbed above $7,000 in eight states; family premiums were $20,000 or higher in seven states and D.C.

* Rising overall employer premiums increased the amount that workers and their families contribute. Average annual premium contributions for single-person plans ranged from $675 in Hawaii to $1,747 in Massachusetts; family plans ranged from $3,646 in Michigan to $6,533 in Delaware.

* Average employee premium contributions across single and family plans amounted to 6.9 percent of U.S. median income in 2017, up from 5.1 percent in 2008. In 11 states, premium contributions were 8 percent of median income or more, with a high of 10.2 percent in Louisiana.

* The average annual deductible for single-person policies rose to $1,808 in 2017, ranging from a low of $863 in Hawaii to a high of about $2,300 in Maine and New Hampshire. Average deductibles across single and family plans amounted to 4.8 percent of median income in 2017, up from 2.7 percent in 2008. In three states (Florida, Mississippi, and Tennessee), average deductibles comprised more than 6 percent of median income.

* Combined, average employee premium contributions and potential out-of-pocket spending to meet deductibles across single and family policies rose to $7,240 in 2017 and was $8,000 or more in eight states. Nationally, this potential spending amounted to 11.7 percent of median income in 2017, up from 7.8 percent a decade earlier. In Louisiana and Mississippi, these combined costs rose to 15 percent or more of median income.

Worker payments for employer coverage are growing faster than median income.

The average employee premium cost across single and family plans amounted to 6.9 percent of median income in 2017, up from 5.1 percent in 2008.

Average deductibles are also outpacing growth in median income.

In many states, even though costs are rising, people are not getting insurance that protects them more because deductibles are also increasing.

Still think that the free market works for health care? Guess again.

We are the only advanced nation that refuses to give its citizens universal health care like other similar nations do. This “growth” is unsustainable and will lead to single-payer health care.

 

Health Care Costs Rising for Workers

Axios is reporting that health care costs for workers is rising while overall costs of employer-based health benefits is growing modestly from year to year.

This is slowly eating up all of the average workers wage increases, and then some, as reported by the Kaiser Family Foundation’s  2018 Employer Health Benefits Survey.

The survey covers the last ten years, from 2008 to 2018. Most of where the employees are paying for health care comes from deductibles, which has seen a +212% increase over that period, and is out of pocket. These costs, the survey said, is rising faster than inflation and wages.

Premiums for families have risen over this period +55%, while workers’ earnings have risen +26%, and inflation has risen +17%.

According to Kaiser, employees are paying an average of about $1,200 per year in premiums. That’s 65% more than what they paid in 2008, for single coverage plans that cover only the worker, no family members.

Besides the increase in deductibles, the number of employees who have a deductible has gone up, and the number of employees with above-average deductibles is up as well.

Three takeaways:

  • More patients are more attuned to the high costs of care.
  • The underlying cost of health care services is growing relatively slowly right now, compared to historical trends.
  • But there’s a sense, at least among some liberal-leaning health care experts, that employers have just about maxed out their ability to shift more costs onto employees — meaning that once price increases start to pick up steam again, businesses and workers will both feel the pain quickly.

What does this mean?

As workers’ wages are stagnant, and health care costs are rising, shifting the cost of health care onto the backs of workers is not only counterproductive to lowering the cost of health care, it puts an undue burden on those who can least afford to shell out more of their hard earned income on health care, especially when they have a serious medical issue to deal with.

Single payer will relieve the worker from having to pay out of pocket when wages are stagnant, and when wages rise again. This will enable them to have more money to spend on things that otherwise would have been prohibitive before.

To do no less is to saddle the working class with perpetual debt and decreased economic power. Not a good way to run an economy.