Attorney Nina Kallen hosted this week’s Cavalcade of Risk, and it included a couple of interesting entries about the Facebook IPO. Given that we write about health insurance, I especially liked Dr. Jaan Sidorov’s article comparing Facebook and ACOs. His verdict? Well, you’ll have to read his article to get the details, but he’s not particularly impressed with either one. I tend to see ACOs in a relatively positive light, and I think they have a lot of potential for cost savings and creating more of a teamwork dynamic between providers and health insurance carriers. But Dr. Sidorov makes some good points about the potential downsides. As usual, good food for thought from the Disease Management Care Blog.
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Beware A Scam Targeting Health Insurance Consumers
The Colorado Division of Insurance notified us today of a new scam that is targeting Colorado health insurance consumers.
People have been getting phone calls from someone who claims to be with the “Colorado Insurance Commission” (there is no such agency – it’s called the Colorado Division of Insurance), telling the potential victim that his or her Colorado health insurance carrier has been taken over by the state. Then the caller says that the state sent the insured a check for $399 to refund copays, but that it was returned by the post office. The caller then offers to direct deposit the $399 into the insured’s bank account – and of course asks the person to provide bank account details in order to facilitate this.
As is pretty much always the case when someone calls and wants your bank account information over the phone, this is a scam. DO NOT GIVE YOUR BANK ACCOUNT INFO TO ANYONE WHO CALLS YOU, no matter how legitimate their claim might sound.
If you get a call like this, you can report it to local law enforcement. If you ever get a call from someone who wants your bank account information – for any reason at all – you can hang up and then call the company in question directly (for example, in this case you could just call your health insurance carrier and find out right away that no part of the caller’s statement is true). Once you’ve determined that the original call was a scam, report it to law enforcement.
The Colorado Division of Insurance wants consumers to be aware of this scam. And again, legitimate organizations don’t call people and ask for banking information over the phone. A general rule is that you shouldn’t give out that information to anyone unless you were the one who initiated the communication.
How Individual Health Insurance Measures Up
[…] So although it’s true that out-of-pocket costs are higher in the individual market (likely due in large part to people opting for policies that are less expensive), if we combine the premiums and the out-of-pocket costs, the total expenses are lower in the individual market ($8,821 in the individual market versus $15,158 in the group market, using Colorado private sector family premiums for the group data). To ignore cost when comparing the policies is to leave out a large piece of the equation.
The Commonwealth Fund study mentions maternity coverage as an example of a benefit that is often not included on individual policies, thus earning them a “tin” rating. In Colorado, maternity is now included on all policies that have been issued or renewed since January 2011 (the data for the study was collected in 2010). But in many states, maternity coverage in the individual market is rare and/or quite expensive as an optional rider. This will change in 2014, and based on our observations of the Colorado individual market over the past year and a half, I would say that the change will be a positive one. But given the fact that so many individual policies did not include maternity coverage in 2010, I’m curious as to what percentage of individual health insurance plans would have earned at least a “bronze” ranking if maternity had been excluded from the data. If we don’t count maternity, how do individual health insurance plans measure up? Most individual plans (assuming they aren’t mini-meds or some sort of limited benefit coverage) in Colorado in 2010 covered complications of pregnancy and charges incurred by a newborn (eg, a premature baby who is in NICU for weeks). But routine maternity care was included on very few individual plans in Colorado prior to 2011. Given that fact, and the fact that all new individual plans in Colorado now have maternity coverage, I’d be curious to see how individual and group plans compare in 2012.
Overall, I think that The Commonwealth Fund study is a good one. It highlights the out-of-pocket exposure that people have in the individual market, and it’s true that the average plan in the individual market has higher out-of-pocket exposure than the average plan in the group market. But to make the comparison without also looking at the premium costs in each market seems a bit disingenuous. If individual health insurance were two to three times as expensive as it is now, it could cover more costs for members with less cost-sharing. But that doesn’t seem like a good solution either.
A Shared-Risk Success Story
[…] In addition to beating their target financially, the program has also resulted in happier patients, increased market share for Blue Shield, fewer patient readmissions (likely due to the comprehensive patient discharge program that they created, and better chronic care management), a significant decrease in the number of inpatient days per thousand members, and far lower start-up administration costs than are typically projected for ACOs (although they note that they worked with existing programs and already-established relationships, so they weren’t building an ACO from scratch. But I imagine that would likely be the case with most ACO creation?). […]
Medical Underwriting Makes Individual Health Insurance Much Less Expensive Than Group Coverage
[…] But although there are differences between group and individual coverage that can account for some of the price variation, by far the biggest factor is medical underwriting. The Zane Benefits article points out that 80% of healthcare costs come from 20% of the population – individuals with serious, ongoing health conditions. Group health insurance is required to accept all eligible employees, but individual health insurance carriers use medical underwriting to eliminate the sickest applicants from the pool of insured members (70 % – 90% of applicants in the individual market are accepted and offered a policy – there is quite a bit of variation in underwriting guidelines from one carrier to another and from one state to another). This mean that individual policies are covering people who are generally healthier than the average of the entire population. And that translates to lower healthcare costs in the individual market. […]
New Healthcare Price Comparison Database Coming Soon In Colorado
[…] Happily, it looks like we’re going to be getting a good healthcare price comparison database here in Colorado next year. This article from Kaiser Health News has all the details, and it looks promising. As the article states – and as we’ve noted here many times – healthcare costs sometimes seem to have little rhyme or reason. They can vary widely from one provider to another and from one area to another without much of a difference in quality of care or patient outcomes. But there are also some variables that have a justifiable impact on healthcare cost variation, such as the overhead expenses associated with teaching hospitals and hospitals that treat a higher-than-average number of uninsured patients. It sounds like the All Payor Claims Database is addressing those issues, so it will be interesting to see how the database accounts for them. I also like the fact that providers will be able to see how they compare with other providers before the data is released to the public, in order to allow the providers to start making improvements where necessary.
I can see this comparison tool – especially given how comprehensive it looks to be – being very beneficial for Colorado residents, and also helping to foster more competition among healthcare providers in the state.
Care Management Outsourcing
[…] outsourcing of care management and the success of MedAssurant, a data-driven healthcare solutions company that works with provider organizations that care for more than a third of the US population.
With healthcare providers feeling the squeeze both in terms of reimbursements for care and time spent on administration, it makes sense that outsourced care management could be an important part of a medical office’s business plan. Utilizing economies of scale in this manner could save time and money for medical offices, and streamlined care management is likely to be popular with health insurance carriers too. As Jaan points out, MedAssurant has very savvy customers (including health insurance carriers and healthcare provider organizations) and a solid track record, so the service they are providing is obviously valuable and beneficial.
Prescription Drug Reuse And Disposal Programs In Colorado
Four years ago, we wrote an article about recycling prescription drugs to be used by patients who don’t have health insurance or cannot afford their medications. This has remained a popular post on our blog, and people frequently search our site for information about prescription recycling and/or disposal programs in Colorado. So I wanted to write an updated post with information that we’ve come across in the years since we published that first article. […]
Anthem Introduces New Accident And Critical Illness Benefits In Colorado
[…] For individuals and families who are healthy and rarely need their health insurance benefits, an accident may be their primary concern. Obviously we’re all susceptible to illness aswell, but accidents have a more “out of the blue” quality to them, and can happen to even the healthiest of people. We’ve never needed our health insurance due to illness, but we’ve had a few injuries over the years that have been pretty costly. Stitches and x-rays on our son’s finger alone came to $1,400. The charges can add up quickly when you’re in an emergency room, and if you have a high deductible health insurance policy, you’d be responsible for the entire bill for an incident like that. An accident supplement that will cover all or a portion of the deductible can help people feel more at ease with a high deductible (ie, less expensive) health insurance policy.
The accident supplement portion of Balance will coordinate with your health insurance, so it will pay you either your out-of-pocket amount or the Balance benefit maximum, which ever is lower. For example, if your out-of-pocket expenses for an accident – after health insurance has paid its portion – come to $1750 and you have the $2500 benefit Balance plan, you’ll get $1750 in supplemental coverage. But if your out-of-pocket expenses come to $4500, you’ll get the full $2500. The critical illness benefit is a lump-sum payment, but the amount paid depends on the specific diagnosis.
With the introduction of Balance, Anthem Blue Cross Blue Shield has added another solid plan to the options available for individuals and families in Colorado who are looking for an accident and critical illness supplement to go along with their health insurance policy.
Taxes And Individual Health Insurance
[…] Greg’s most recent article deals with the way that our tax code treats health insurance premiums. Medicare and Medicaid premiums are obviously subsidized by tax dollars. But group health insurance premiums are also subsidized, since the premiums that employers pay on behalf of their employees are not included in the employee’s taxable income.
People with individual health insurance usually don’t get such a benefit. The self-employed get to deduct individual health insurance premiums on the 1040, but there are plenty of people who purchase individual health insurance and are not self-employed. Early retirees are a good example, as are people who buy their own health insurance because their employer does not provide it.
Greg’s article goes beyond what we usually see on this topic (ie, pointing out the inherent unfairness of not allowing similar tax treatment for all health insurance premiums, regardless of whether the coverage is group or individual). He delves into what the possible implications could be for the individual health insurance market if the tax code were changed to a more equitable system. His prediction includes millions of additional people entering the individual market (thanks to a switch from group to individual coverage), more lenient underwriting standards in the individual market, more innovative products available to consumers, and more competition in the individual market. Check out his article for all the details – definitely some good food for thought.
Wild Wild West of Electronic Medical Records
This article was sent to us through our contact form from “Sandra” as an entry is our open mic/guest blogger category. Sandra is not a client of ours, but says she found our guest blogger category while researching her situation and would like her opinions published. We kept Sandra’s requested title for the post and… Read more about Wild Wild West of Electronic Medical Records
Best Health Insurance Companies In Colorado
We recently got a call from a client who mentioned that he had done a Google search for the “best health insurance companies in Colorado” and his concern was that Anthem Blue Cross Blue Shield was not on the top ten list that he said came up as the first search result. We were a… Read more about Best Health Insurance Companies In Colorado
Kaiser Will Soon Be Available In Northern Colorado
[…] The new Kaiser facilities will be in Fort Collins at Harmony and Ziegler, and in Loveland at I-25 and Hwy 34. For hospital services, Kaiser is partnering with Banner Health and members will be able to use McKee Medical Center in Loveland and North Colorado Medical Center in Greeley. The medical offices in Fort Collins and Loveland will offer a wide range of services (primary care, lab work, pharmacy, and x-rays, and mammograms will be available at the Loveland office), and are expected to begin providing care by the fall of 2012. A medical office is projected to open in Greeley by 2014. Between now and then however, northern Colorado Kaiser members will be able to see doctors at the Fort Collins and Loveland offices, as well as physicians on the Banner Health network.
Kaiser is planning to offer group coverage to employers in northern Colorado by October 1, 2012. Individual and family coverage should be available sometime next year.
IRS 2013 HSA Contribution Limits
The IRS announced that the 2013 HSA contribution limit for an individual would increase by $150, from $3,100 to $3,250. The family contribution limit is increasing from $6,250 to $6,450 (+$200).
The maximum annual out-of-pocket increased as well. The individual out of pocket maximum is going from $6,050 to $6,250. The family out of pocket maximum is increasing from $12,100 to $12,500.
The minimum deductible on an HSA qualified plan also increases from $1,200 to $1,250 for individuals and increases from $2,400 to $2,500 for families.
What are the 2012 HSA Contribution Limits?
According to the Patient Protection and Affordable Care Act, OTC drugs may be reimbursed only if there is a prescription.
Non-medical withdrawals from an HSA are taxable income and subject to a tax penalty, which increased from 10% in 2010 to 20% in 2011 and remains the same for 2013.
Exception to the IRS tax penalty for non-medical withdrawals:
The tax penalty does not apply if the withdrawal is made after you:
1) Attain age 65;
2) Become totally and permanently disabled; or
3) Die.
More details and research about HSAs and HSA qualified plans.
Too Big To Fail?
[…] Given the large market share that some hospital systems and health insurance carriers have in other states, I wonder if those organizations might already be “too big to fail”, even before ACOs come into the picture? Would the financial collapse of one of those systems be too much of a destabilizing factor and require a government bailout in order to protect the communities served by the healthcare organizations?
So far, we haven’t seen such a scenario. In general, when a healthcare organization leaves the market, it is bought out by another organization that is more financially sound (for example, Celtic agreed to take over World and American Republic’s insureds last year when those companies left the market). This happens quite often with hospitals and small-ish health insurance carriers. But the titans of the financial industry that had to be bailed out in 2008 were not the “small-ish” banks – they were huge organizations that everyone thought were very sound. If something like that were to happen to healthcare organizations – either insurers or large hospital systems – would a bailout be necessary in order to stabilize the healthcare system?
I assume that ACOs are being crafted with a bit more care and transparency than what went into CDOs. And hopefully the lessons learned in the financial markets crisis will be well-remembered as healthcare market overhauls are created.
Details From Anthem On Preventive Care And Contraceptive Coverage
Last week we added a post about contraceptive coverage under the PPACA and what changes people could expect to see starting in August. We just received an information sheet regarding this subject from Anthem Blue Cross Blue Shield, and wanted to share it with our readers. It will be useful for our Anthem clients, and is also helpful to give people a rough idea of how the contraceptive coverage will be implemented by most carriers. There may be some small variations from one carrier to another, but in most cases things will be similar across the board, since federal legislation is guiding the changes.
The Anthem preventive care info sheet is relevant in Colorado and nine other states where Anthem operates Blue Cross Blue Shield plans, and applies to individual health insurance as well as small and large group plans.
The Anthem info sheet specifically notes that sterilization procedures for men are not included in the new contraceptive coverage – which is the conclusion I came to last week after quite a bit of reading on the subject – since all of the guidelines apply to adding contraceptive coverage to preventive care for women rather than preventive care in general. […]
Contraceptive Coverage And The PPACA
[…] Anyway, assuming that we’re talking about contraceptives for women, new health insurance policies – except those that are exempt based on religious reasons – will cover contraception with no copays or deductibles. Non-grandfathered plans (grandfathered means that the policy was in effect prior to the PPACA being signed into law and that the plan has not made any significant changes since then) will have to start covering contraceptives as of each plan’s renewal date. This is similar to how the state maternity mandate worked in Colorado last year. New policies had to start covering maternity on January 1, 2011. But existing policies added it throughout the year as each plan renewed (for example, my family’s health insurance plan renews each year in November, so our maternity coverage didn’t begin until November 2011). This brief from the Kaiser Family Foundation website has a lot of good information regarding contraceptive coverage and should help to clarify the issue a bit. […]
Replicating Grand Junction’s Healthcare System
[…] This is a scenario that I could see being implemented even without a monopoly by one health insurance carrier. Grand Junction aside, if we look at the whole state of Colorado, the top 70% of the health insurance market is comprised of ten carriers. I wonder if it would be possible for medical offices to set up agreements whereby they pool money received from those ten carriers and from Medicare, Medicaid, and CHP+. Then instead of paying physicians directly from the health insurer depending on the insurance coverage of each specific patient, the doctors could simply be paid either a salary or an average reimbursement for each patient, regardless of which insurance that patient had. This would require some restructuring in terms of how medical billing is done, but it would allow medical offices to continue to negotiate competitive contracts with private health insurers (and the higher the contracted rate, the more total dollars the medical practice would have to put into their payment pool).
One of the major factors that contributes to the success of the system in Grand Junction is that doctors there are ok with receiving lower total incomes than they would in other areas that don’t function the way Grand Junction does. When you pool Medicare and Medicaid payments together with private health insurance payments, the public health insurance reimbursements drag down the average payment. In order to make sure that people with public health insurance are receiving equal access to healthcare (which they currently do not, especially those with Medicaid), the per-patient average reimbursement for physicians would have to decrease, since it would mean that more lower-paying patients would be treated. The caveat that doctors would have to be willing to work for a little less money is especially true of specialists, which is where the highest incomes are. […]
Hospital Payment Assistance Program Will Benefit Colorado’s Uninsured Population
[…] SB12-134 will result in some significant changes in terms of how uninsured patients are billed when they receive treatment in a hospital (note that the bill only applies to hospitals – outpatient clinics, medical offices, and other non-hospital providers will not be impacted). Most people are aware that private health insurance carriers have negotiated rates that are lower than the “retail” price for medical services. Medicare and Medicaid have even lower negotiated prices. The reason SB12-134 is so important is that uninsured patients (usually those who have the least ability to pay medical bills) typically get charged the retail price. There is usually a cash discount available, but most uninsured patients typically don’t have enough cash sitting around to pay the whole bill up front. So – assuming they are able to pay the bill at all – they often end up on a payment plan (sometimes through a third party where interest rates can rival those of credit cards) and ultimately pay far more than any insurance carrier would pay.
SB12-134 applies to medically necessary care provided to uninsured patients who have a family income of not more than 250% of the federal poverty level ($57,625 for a family of four in 2012). And SB12-134 applies only if the care is not eligible for coverage through the Colorado Indigent Care Program (CICP). For those patients, hospitals may not charge more than the lowest rate they have negotiated with a private health insurance plan. This is a huge change from the status quo.
SB12-134 also requires hospitals to clearly state their financial assistance, charity care, and payment plan information on their website, in patient waiting areas, directly to patients before they are discharged, and in writing on the patients’ billing statements. Hospitals will also have to allow a patient’s bill to go at least 30 days past due before initiating collections procedures. […]
Despite IT Problems, Report Gives Colorado High Marks On Exchange Progress
[…] On the upside, the Urban Institute report gives Colorado props for making good overall progress on setting up the health benefits exchange. Despite the political hot seat that health care reform has been for the past few years, Colorado lawmakers managed to work together to create the framework for our health benefits exchange last year. We have a board of directors in place and the state is moving forward as fast as possible to get things in place for the exchange to be up and running in 2014. A lot is still unknown with regards to the future of the ACA, since the Supreme Court still has to issue their ruling in June regarding the legality of the individual mandate. But if the ACA remains in place and the health insurance exchanges become reality across the country, it’s safe to say that Colorado will be ahead of the curve in terms of getting the bugs ironed out.
The Urban Institute report notes that Colorado had a head start on a lot of the reform issues thanks to the 2008 Blue Ribbon Commission Report. Remember back when that was the big news in health care reform in Colorado? Before health care reform became such a divisive topic across the country, Colorado was working to come up with solutions to many of the problems with our health care system. Some of the recommendations of the Blue Ribbon Commission are very similar to the new guidelines in the ACA, and Colorado had been taking active steps for the past four years to implement the Blue Ribbon recommendations. If the ACA remains in place, it should be a bit easier for Colorado to make the necessary transitions over the next few years, thanks to the progress the state has already made on its own.
Cavalcade Of Risk And Shared Savings Programs For Small Physician Groups
Dr. Jaan Sirorov of the Disease Management Care Blog hosts this week’s Cavalcade of Risk, and it’s an excellent edition. Be sure to check out Jaan’s own article in the Cavalcade, discussing the practicality of small (four doctors) primary care practices entering into collaborative savings arrangements with health insurers. I recently wrote about how Cigna… Read more about Cavalcade Of Risk And Shared Savings Programs For Small Physician Groups
Who Pays The Bill If A Patient Checks Out Of The Hospital Against Medical Orders?
[…] None of that is true however. As long as the treatment provided is a covered service on the patient’s health insurance plan, and as long as any required pre-authorization was taken care of, the health insurance carrier does not withhold payment simply because the patient acted against medical orders and checked out of the hospital. This is also true of other forms of non-compliance: for example, patients who don’t fill their prescriptions or those who resume activity too soon after surgery will generally find that their health insurance still covers their bills according to the language of the contract.
If “never events” on the patient end of the scale were cause for claims denials, I have a feeling that there would be a lot more denied claims. Health insurance carriers can and do charge higher premiums for various choices people make (like smoking, for example). But once a policy is in force, and premiums are paid on time – and assuming the application was completed honestly – the coverage is usually not dependent on the patient following doctors orders
A Doctor Who Cooks Brussels Sprouts For A Patient
[…] Dr. Flansbaum’s article is a must-read if you’re interested in the socioeconomic factors that contribute to obesity and “lifestyle” health conditions. Colorado has the distinction of being the least-obese state in the US (although we recently passed the 20% mark in terms of the percentage of adults who are obese). I’m sure this is due in large part to the state’s relatively affluent population, the plethora of outdoor activities available (combined with 300 days of sunshine each year), and the plentiful food choices available. Of course there’s a bit of a chicken-or-the-egg question too… are there plenty of healthful food choices available here because the people who live here demand them, or are there healthy people here because of all the good food options we have?
Cigna And CSHP Collaborating On An Accountable Care Program
[…] The collaboration between Cigna and CSHP will focus on improving patient outcomes, making healthcare more accessible and affordable, and improving patient satisfaction. One of the key components of the Cigna program is registered nurses working at the medical offices who will serve as care coordinators. These care coordinators will follow up with recently hospitalized patients to try to avoid preventable re-hospitalizations (costly and definitely not likely to result in a satisfied patient). They will also work with patients who have chronic illnesses to make sure the patients are filling their prescriptions, receiving needed office visits and screenings, and getting referrals to disease management programs that could help to prevent the conditions from worsening. The hands-on approach that the medical offices will be taking is likely to result in fewer re-hospitalizations and better overall compliance with medical advice.
Hopefully the program will also provide guidance for patients who aren’t filling prescriptions because they cannot afford to do so (for example, a referral to pharmaceutical company programs that provide free medications to people who can’t afford them), and help to address issues like lack of transportation or inability to fit medical office visits into inflexible work schedules. Some people truly just need a reminder to go get a screening test or refill a prescription. Others have more significant obstacles preventing them from doing so. […]
A Possible Alternative To The Individual Mandate
[…] Guaranteed-issue health insurance is expensive. When it’s enacted without a mandate requiring people to buy it, the premiums can become out of reach very quickly. In Colorado, group health insurance (all eligible employees are guaranteed enrollment, regardless of medical history) is significantly more expensive than individual health insurance (medical underwriting applies until 2014 when the guaranteed issue provisions of the ACA kick in). But since employers usually pay at least a chunk of the premiums, people aren’t generally aware of the full cost of group health insurance. In the individual market, that cost will be more transparent (subsidies – also created by the ACA – will be a significant help for a lot of families).
Any way you look at it, the claims expenses will be high once all health insurance is guaranteed issue. I would assume that individual health insurance premiums will start to look more like group premiums as the years go by. The goal of increasing premiums for late enrollees should be three-fold: To make the practice of waiting to purchase health insurance until one is sick seem less attractive; to make sure that there are enough total premium dollars collected to pay for the total claims submitted; and to make things as fair as possible for people who opt to have health insurance all the time, even when they’re perfectly healthy. Those people should not be paying the lion’s share of the total premiums.
I agree with Jason that if this model were used, it should be up to the carriers – with regulatory oversight – to set the premium adjustments rather than having the government set the prices. But I think that if we use this model to try to accomplish all three of those goals I outlined, the premium adjustments for late enrollees would have to be pretty significant.