Comments on: Non-Profit Does Not Necessarily Mean Low Cost

By: Louise

Louise — Sun, 24 Jan 2010 23:19:44 +0000

Ken,
Thanks for your comment, and you do raise some good points. However, in the individual market in Colorado, Kaiser and Rocky Mountain Health Plans (the two most popular non-profit individual/family carriers) have more strict underwriting than most for-profit carries. This may not be the case in other states, but in Colorado the underwriting on Kaiser and RMHP policies requires a person to be in pretty good health to be accepted at all, while other carriers might accept the person with a 25% or 50% rate increase to account for pre-existing conditions.

By: Ken

Ken — Sun, 24 Jan 2010 21:31:03 +0000

What you’re overlooking is that the non-profits have less of a motive to, well, deny you coverage. The coverage contracts might be similar, or maybe they aren’t. Does Blue Cross cover the same conditions as Kaiser? And if they do, are you sure they’ll come through if you’re sick? Keep in mind that if an insurance company doesn’t pay for your treatment, your only alternative is to spend years in litigation — not a very promising option for people who have six months to live without surgery.

I think if we want to salvage the totally broke and byzantine system we currently have, the new rule should simply be that all insurance companies be non-profit. It’s just a common sense rule. After all, are fire or police departments for-profit? Then why should healthcare be.

By: Jay

Jay — Mon, 21 Dec 2009 20:38:02 +0000

Well put, Don. And GreenDreams, as long as you’re healthy enough to move to another insurer or another plan, I would do so. Closing a block, or “sunsetting” a plan, is designed to “trap” those who have developed health conditions since underwriting. Their rate increases rapidly until it’s higher than the government state sponsored risk pool, which is when the insured qualifies for coverage on the risk pool. In Colorado, the risk pool is http://www.covercolorado.org.

By: GreenDreams

GreenDreams — Mon, 21 Dec 2009 20:12:48 +0000

Thanks for the response, Don. I know all too well about the “closed block” problem, as my insurer has decided my policy is too expensive for them, so is eliminating it by way of a 25% rate increase, trying to move me to a different “block”. I’d rather move to a different company.

By: Don Levit

Don Levit — Mon, 21 Dec 2009 19:08:47 +0000

GreenDreams:
New product development is typically used by insurers to develop new blocks of business.
Older blocks typically are closed to new entrants, who can enter only the newly opened blocks of business.’
This is like a Ponzi scheme without the Ponzi, new applicants, to take up the slack.
According to the Amereican Academy of Actuaries, “It is common practice of the current individual health insurance market that an insurer will periodically close a block of business. That closed block will typically have claim costs rising more rapidly than an open block.
Because there are no new entrants to a closed block, experience often worsens over time, leading to large rate increases. This occurs when rate increases are based on the experience of that closed block alone, rather than on multiple blocks, including currently sold business.
Unfortunately, this exercise is used by both for-profits and non-profits to strengthen their bottom lines.
Would this practice change with health reform?
Pages 3 and 4.
Go to:
http://www.actuary.org/pdf/health/rate_may04.pdf.
Don Levit

By: GreenDreams

GreenDreams — Mon, 21 Dec 2009 18:28:08 +0000

For me, after the debacle of health care reform hinging on huge campaign contributions and manipulation of public opinion by the insurance industry, my goal is to deny these reprehensible creeps the dollars they feed on. Nonprofits, or rather tax-exempts, are forbidden to lobby or support politicians. If that’s true, that is who I want to support with my dollars. Similarly, I’m cutting off the banks and credit card companies and moving everything to a local credit union.

As for the debate about single payer, the best data we have shows the US ranks poorly in outcomes v.s. nations that spend a fraction of what we do. I thought our goal was to provide the best care to all Americans at the lowest cost. Apparently not. It’s to protect the for-profit health care model from unfair competition from the government.

The goal of corporations is not to provide care, but profit. Their goal is at odds with our national goal, because your health will never matter to them as much as their profit. Hence they lower “medical loss” by not paying, delaying, rescission and discriminating. Nothing about those tactics, nor the lobbying expense, sales and marketing, underwriting, “new product” development, big executive salaries, corporate jets and cars, palatial offices or other goodies contribute to health care delivery at all. Health care is not the goal of the corporation.

By: Don Levit

Don Levit — Wed, 09 Dec 2009 18:46:16 +0000

Ron:
Thanks for your reply.
Myth #4 posted on the Social Security’s web site says that the money participants paid would be put into the Independent Trust Fund, rather than into the General Operating Fund, and therefore, would be only used to fund Social Secirity, and no other Government program.”
There has never been any change in the way the Social Security program is financed or the way that Social Security payroll taxes are used by the federal government.”

Well, there seems to be some conflict here on this very same Social Security web site.

“Taxes are collected as are other general revenues and are not allocated as was proposed to an Old-Age Fund, but are merged with the general funds of the Government in the Treasury.”
http://www.ssa.gov/history/reports/ces/cesbookc10.html.

“The money will go into the Treasury – the General Fund. The tax money does not go into the Social Security account, but goes into the Treasury.
http://www.ssa.gov/history/pdf/h417.pdf.

Well, what does go into the Social Security Trust Fund – credits, bookkeeping entries, not cash.
“Cash income from earmarked sources goes into the Treasury’s general fund. The income is then CREDITED TO THE TRUST FUND.
The actual cash receipts are expended from the General Fund for whatever purpose arises.”
http://www.cms.hhs.gov from the Health Care Financing Review, 10-2005.
Don Levit

By: Ron

Ron — Wed, 09 Dec 2009 16:58:57 +0000

Don’s comment on Jul 28 2009 seems to say that Social Security funds have been used for general governmental expenses. If that’s his contention, it’s simply not true…..even though that contention has been perpetuated through spamish emails. Got to this link to find out more: http://www.snopes.com/politics/socialsecurity/changes.asp

I have medical insurance through Kaiser Permanente and am more happy with it than the Blue Cross/Blue Shield I used to have and pay nearly $300/month less. Frankly, I think Kaiser would be a good model to use in health care reform.

By: Paul Mah

Paul Mah — Wed, 23 Sep 2009 20:19:31 +0000

The sweeping declaration that medical care is better in countries like the UK and Canada is not accurate. It uses the same false measure of health care quality used in the premium comparison shopping exercise. Cheap does not mean better just like expensive doesn’t mean bad.

The higher costs for health insurance go hand in hand with higher expectations for high quality services. The myth thrown around these days in health care discussions is the term “quality health care” … Every one gets quality health care even in rural Somalia. The problem is would you be happy with the quality health care provided in the UK and Canada. I know that Canadians have long waits (years) to be assigned a primary care provider. That means the doctor is not one chosen by the patient. Likewise the news media in the UK has reports routinely about quality care failures.

http://www.telegraph.co.uk/comment/5010722/Heads-should-roll-over-the-Staffordshire-hospital-scandal.html

http://www.telegraph.co.uk/health/healthnews/6156076/Daughter-claims-father-wrongly-placed-on-controversial-NHS-end-of-life-scheme.html

By: Joe

Joe — Tue, 18 Aug 2009 16:32:39 +0000

Great discussion. Although there is waste in the medical delivery end of the system, the administrative costs of the American health system are a major issue. A 1999 study found "fter exclusions, administration accounted for 31.0 percent of health care expenditures in the United States and 16.7 percent of health care expenditures in Canada." Link.