Sunday, August 16, 2009

Food for thought

First and foremost, the purpose of the public option in health care reform is to keep the insurance companies honest. Really, nothing else. Does anybody, anybody at all, actually think the insurance companies are honest?


JackofGreen said...

What do you mean by honest? The vast majority of insurance companies are for profit business and are there to maximize profits. its also amazing to me that people think that the "mean old insurance compaies" are responsible for denying their claims, running up their bill, etc. Insurance companies will sell your employer and plan that the employer wishes, but it is your employer who picks it, and decides on how much they want to spend per indvidual.

kimalanus said...

A House committee is holding hearings on the subject of recission, the retroactive cancellation of an insurance policy. An insurance company executive says "Rescission is rare. It affects less than one-half of one percent of people we cover. Yet, it is one of many protections supporting the affordability and viability of individual health insurance in the United States under our current system". The counter argument is here:
"To understand why 0.5% of the people Assurant covers is a lot of people – a jarring, terrifying, probably criminal lot – you need to understand a little bit of math"
Read the article, understand the math and you will know that Assurant, which is hardly atypical, is a bunch of sociopathic rat bastards stealing your money. They made the mistake of telling us the real numbers and expecting us not to get the context.

Anonymous said...

Unfortunately, this is one of those occasions where I have to take a more neutral point of view. An equally valid question to ask is if anyone actually thinks that any government-operated cost management system is going to be any more honest. As JackofGreen suggests, whatever flaws exist in insurance companies (and I will not dispute that there ARE glaring flaws), they are predictable in their motivation. Any "public option" that does not have that predictable motivation is, inherently, going to be more unpredictable. In the worst case, it will also be subject to the consequences of future complex and complicated political actions. Citizens do enjoy a long-term ability to hold our government accountable for its present and future decisions, but only in a very long-term sense. Knowing that you can cast a vote to can an idiotic representative in a year or two comes as little consolation if that representative makes a decision that has an impact on one now. A public, not-for-profit cooperative, from that standpoint, can end up with the very worst of both worlds.

I am not saying that any of the ideas I have read about are unworkable. And, in the end, compromise will rule the day no matter what. But, when asking the question of trust anyway, I find it debatable whether any of the ideas I have read about is inherently more "trustworthy" than any other. The proof of that will be in the practice, more than the principle.


kimalanus said...

OK, "the proof is in the practice", and there's plenty of government practice to look at. The United States pays 20 to 30 percent more for medical care, highest per capita expense bar none, but ranks 39th in the world for outcomes,lowest among industrialized nations. Canada, with a 100 percent public option ranks 6th in outcomes. Great Britain, which spends HALF what we do, and has 100 percent government medical care, not just payment, ranks 16th. Those surrenderin' Frenchmen rank 1st!

Our own Medicare system runs on a tenth (2 to 3 percent vs. 20 to 30 percent) the overhead of the private insurance system with much higher customer satisfaction.

In fact, the performance of the Veterans Affairs health system goes straight to the heart of your question. Under modernized management, the VA has consistently outperformed private insurers in quality, efficiency and patient satisfaction since the 1990s. VA per-patient costs have been held steady at about $5,800 per patient since 1996 even as the average per capita cost nationally increased by nearly 75 percent. The VA pioneered innovative software programs that improved care and were even responsible for exposing the dangers of the drug Vioxx, leading to its withdrawal from the market.

By comparison, did you read Taunter's article?

JackofGreen said...

You didn't really answer my question about what you mean by "honest" but I'm going to let that one go.

The Daily Kos article is mixing and matching its data and has a lot of faulty logic. The vast majority of persons who have health insurance do not have individual policies they have group polices (i.e. from the Employer). (In fact in many states it is almost impossible to buy an individual policy because the insurance brokers don't sell them, but that is a question of access not germane to this discussion). The numbers in regards to claims are fairly accurate; the general rule is that 20% of the participants in your plan will submit 80% of the claims. However, the author is using the small sub-set of people who are in the individual market-place and then applying those numbers to all claims. For example they say, “You have to hit the 95th percentile to get anywhere interesting, and even there you have only $11,487 in costs. It’s the 99th percentile, the people with over $35,000 of medical costs, who represent fully 22% of the entire nation’s medical costs.” These numbers are for everyone not the individuals in the individual health plan market. So how do you know what the individual market claims are? Higher? Lower?

Mr. Tauter goes on with, “It should be fairly clear that the people who do not file insurance claims do not face rescission.” Really? How do you know that? A more likely experience is that you would bounce those individuals BEFORE they submitted claims. Why buy the risk?

I would also like to point out that what they are talking about individuals who lied on their application. I guess then the argument that you are making Kim is this one: “Yes those individuals lied on their application BUT since you Insurance companies are all bad people you have to provide them coverage anyway regardless of what it will cost.”

kimalanus said...

You say "Mr. Tau(N)ter goes on with, “It should be fairly clear that the people who do not file insurance claims do not face rescission.” Really? How do you know that? A more likely experience is that you would bounce those individuals BEFORE they submitted claims. Why buy the risk?"

We know that because the hearings found such practices to be common:

"The committee investigation uncovered several rescission practices that one lawmaker called egregious, including targeting every policyholder diagnosed with leukemia, breast cancer and 1,400 other serious illnesses. Such investigations involve scouring the policyholder's original application and years' worth of medical and pharmacy records in search of any discrepancies." LA Times, By Lisa Girion, June 17, 2009

One Well Point employee was commended and given a 5 out of 5 on his evaluation for achieving $10 million in policy rescissions. (in the same article. Google "rescission," read widely.

Lastly, if this .5 percent is ONLY the people with individual policies and MOSTLY if not solely those who file claims, it's even more heinous, not less. They only target those who can't defend against it.

One of the less discussed reforms needed is to require insurance companies to vet applications within six months or forgo recission. That would put a stop to this practice.