It should be said that not all health insurers favor the individual and employer mandate.   But as the article here demonstrates why those of us who are in favor of patient centered reforms (instead of the government centered reforms being proposed) to replace the employer-centered model need to agree with our detractors:  the health insurers have not tried to solve the problem on their own, and they could have.  And in fact, they are a significant part of the problem and how we’ve gotten where we are.  Yet another reason why non-insurance options like health care sharing ministries should be reconsidered among the mix, at least as a protected (in the sense of still legal, not subsidized) option.  Other, working, patient centered options need to be protected and expanded as well, but here are some honest issues with the insurance industry in health care reform:

Timothy P. Carney: Down with the health insurers | Washington Examiner
Insurance companies lobby for big-government regulations, subsidies, mandates, and tax-code distortions that funnel them money, keep out competition, and stultify innovation. These policies preserve the employer-based health-care system that mocks the idea of free-market competition. Then they cry “unfair competition” when government threatens to encroach on their government-protected monopolies.

But they’re not just lobbying against a government option. Today, health insurers are lobbying to force you and me to buy their product or face a tax hike (the individual mandate).

They are lobbying to force entrepreneurs to buy insurance for employees (the employer mandate). They are lobbying for more subsidies paid for by us taxpayers. In short, they are lobbying against regular people and against the free market.

The insurers’ lobbyists stood on stage with Rahm Emanuel and Nancy Pelosi in 2007 calling for the expansion of the State Children’s Health Insurance Plan to cover adults and middle-class children–an unreasonable expansion Democrats used as a political cudgel against Republicans.

They also benefit from an absurd tax break–the exclusion on employer-provided health benefits that drags down wages, shifts money into their industry, increases the deficit, and dries up the individual insurance market where actual competition could take place.

HT:  Brian Schwartz

…at least not in the aggregate.  See this post by Sally Pipes of the Pacific Research Institute.

State Policy Network | Blog | Prevention Does not Save Money
Here’s another example from a study published last year in the journal Circulation. Suppose we enact several highly recommended measures to control cardiovascular disease and diabetes. Among other ends, the programs would improve blood pressure monitoring, increase access to medication and reduce cholesterol levels in high-risk patients.

Suppose that these prevention measures were 100% successful. The estimated cost of treating at-risk patients over the next 30 years would drop by about a trillion dollars. The preventive measures themselves, though, would cost $8.5 trillion — offsetting the savings by a factor of almost 10.

Judd Gregg gives health reform a go – Carrie Budoff Brown – POLITICO.com
“I stepped back one week and said, ‘Let’s hold it. What would I do if I could do what I thought was most effective?’” Gregg said in an interview. “I was just saying to myself, ‘What would I do if I had a magic wand?’ I sat back and thought about the ideal.”Gregg’s proposal is built on a pledge to make sure that every American obtains a minimum standard of insurance; such a standard would aim to provide “peace of mind” by covering a major medical event and preventive health services, the lawmaker said.

This is another proposal from the GOP side of the aisle that includes a mandate of some sort (everyone should have some form of insurance).  There are a lot of ways to handle health care without insurance, health care sharing ministries being one way, and Senator Gregg will hopefully notice us and others along the way.

The whole confusing of insurance coverage with health care access in the sphere of rhetoric doesn’t make this easier, and we’ll keep trying to make our voice known.  Senator Gregg, give us a call and we’ll show you how over 100,000 Americans are paying their own health care bills through a community, non-profit, non-insurance ministry.

More insurance isn’t the answer here–more freedom and more choices will bring the changes we want in price and access.

HT:  Ryan Ellis.  (via Twitter)

I wrote the other day about a new study released by Families USA regarding the cost of the uninsured to the insured.  The study has an ulterior motive, as I mentioned.

Another mention of the study by Anne Zieger mentions the cost to the insured, estimated at over $1000 per year per family because,

According to the group, the uninsured received $116 billion in care from doctors, hospitals and other providers in 2008, $42.7 billion of which was never paid for. Providers then raised prices to insurers to cover these costs, and insurers, in turn, charged higher premiums, the group says.

What is not so funny here is that Ms. Zieger, less than a year ago wrote another article on the cost of the uninsured which includes this gem:

 Despite these burdens, cost-shifting to the insured to pay for uncompensated care has a very minor impact on private insurance premiums, hitting 1.7 percent at most, the researchers conclude. Hospitals, they found, don’t raise prices to private health plans to offset uncompensated care, which has stayed stable at about 6 percent of hospital costs for many years despite an ongoing increase in the percentage of people insured.

Why the change in focus?  Well health care reform is coming, of course!  And note this:  “1.7% at most” is the impact of the unpaid care by the uninsured.  So when the rhetoric heats up, and the blaming the uninsured starts remember this:

• Every industry has shrinkage.  When you buy a shirt at Target it has a higher cost because of theft and waste in the industry.  1.7% is a negligible cost for uncompensated care.
• That is not to mention the uninsured who are paying for their health care at increased rates, sometimes 3 to 5 times what insurance companies pay for same services (cost shifting to the uninsured?)
• And the kicker:  neither article, nor the public rhetoric of the mainstream media ever include the cost shifting from already existing government programs, which is over 10%.

So who’s to blame for high insurance premiums?  Certainly the uninsured who are not paying their bills (in stark contrast to health care sharing ministry members!) should be held accountable for their costs, but the overwhelming winner here is the cost shifting that is going on from Medicare and Medicaid.  That problem will not be solved by more government programs that shift more costs to the private sector.

Oh and that 10% number?  I don’t believe it includes the payroll tax that helps pay for the services in the first place.

The uninsured are not a problem in the health care crisis.  Certainly not one that private charity can’t solve on its own.  So don’t lose sight of the real numbers in this public battle.

U.S. group finds insured paying more for uninsured | Markets | Markets News | Reuters
U.S. families with health insurance are paying an estimated $1,017 more in annual premiums to compensate providers for healthcare to the uninsured, a report released on Thursday said. The report by Families USA, a healthcare reform advocacy group, said doctors, hospitals and other health providers try to recover the cost of uncompensated care by increasing charges for those with private insurance.

Note four things about this study and article:

1. no mention of the overpriced services paid for by the uninsured who paid their bills (3 to 5x what insured pay for same)
2. no mention of government entitlement cost shifting which dwarfs this shift $10 for ever $1.
3. note that the study is performed by Families USA a well known advocate of government run health care.
4. there is also no mention of the cost of insurance being driven up by overconsumption by the insured, which also dwarfs any cost shifting from the uninsured.

The uninsured aren’t the problem. The government entitlements that are out of control are driving the costs, and employer provided insurance further complicates the mess. Don’t give more of it to the government.

For more on the non-problem of the uninsured, see John Graham’s excellent article, Don’t Blame the Uninsured.

Shortage of Doctors an Obstacle to Obama Goals – NYTimes.com
The officials said they were particularly concerned about shortages of primary care providers who are the main source of health care for most Americans.One proposal — to increase Medicare payments to general practitioners, at the expense of high-paid specialists — has touched off a lobbying fight.

Family doctors and internists are pressing Congress for an increase in their Medicare payments. But medical specialists are lobbying against any change that would cut their reimbursements. Congress, the specialists say, should find additional money to pay for primary care and should not redistribute dollars among doctors — a difficult argument at a time of huge budget deficits.

This article notices implicitly that it is the Medicare reimbursement for primary care doctors that is causing the shortage.  The government cannot control the supply of health care services–in particular the skilled labor of physicians.  Citizens have to want to enter into the long educational track to be a doctor, and the reward (above average salaries) at the end is part of the reason so many in the past chose to be doctors.

But the hours, the pay, and the Medicare dollars are better for specialists, so given the choice most students have opted against primary care.  And passing a health care reform that banks on people getting access to doctors (some of whom will retire if forced into a government run system) when there are no doctors is problematic.

There are market based solutions to this problem.  Patient centered health solutions like HSAs and Health Care Sharing Ministries put the doctor and patient at the price point, rather than a third party payer or government agency.  Retainer based medicine (aka concierge care) allows patients to contract with doctors for primary care, ensuring good preventative care while preserving the doctor/patient relationship.

The government is the problem in health care–and the solution we’re being sold is more of the problem.  We need more market based initiatives if we want to see quality go up, supply go up, and prices go down.  And simply raising the Medicare reimbursement rate for PCPs will be too slow and certainly a non-market solution that will lead to some other shortage.

This is where indirect rationing comes into play–which is the the more likely source of rationing from the governmentin the near future.  Direct rationing is where the government tells you you can’t have something.  Indirect rationing is where the government fixes the prices so low that supply falls away.  The latter, I believe, is more dangerous because it works slowly and is almost always unanticipated just as this PCP shortage is.

Solution?  As always it’s to get the government out of health care.

HT:  John Goodman

The accusation is that the uninsured (which includes HCSM members, btw, that pay near list price for medical services) cost-shift to the insured and that this cost-shifting drives up the cost of health insurance.

It certainly may–though I’m not convinced that there is cost shifting as a group (considering both the uninsured deadbeats and the uninsured paying list price for services altogether) –but if it does, this study from AHIP (note this is a PDF) shows that it pales in comparison to the cost shifting due to Medicare and Medicaid by a factor of 5.  Medicare/Medicaid actually increase the price for other patients by 18%.

When was the last time you heard about cost-shifting due to government programs listed as one of the problems we need to solve with the coming health care “reforms?”

Just one of the good data quotes:

When broken down, we estimate the cost shift adds $1,512 annually, or 10.6%, to the premium of a family of four.  Of this cost shift amount, we estimate employers pay $1,115 and subscribers $397 annually.  The cost shift also increases member cost sharing by approximately $276 annually.

Yet again, this shows why private charity is better, and that the uninsured are not the problem.   We need to keep an eye on the reforms that are coming out of congress, because a government sponsored insurance plan (one of the more popular ideas right now) will only exacerbate this problem and further drive up costs for employers and private market payers, like cash patients including HCSM members.

HT:  Greg Scandlen via NCPA blog

Would the Health Reform Prescriptions Offered by President Obama and Congressional Leaders Help Patients?
STATEMENT ON HEALTH REFORM

From the Health Policy Consensus Group1

President Obama repeatedly has reassured the American people, “If you’ve got health care already, and probably the majority of you do, then you can keep your plan if you are satisfied with it. You can keep your choice of doctor.”2 Research shows 82 percent of Americans rate the health care they receive as good to excellent.3

At the same time, there are serious problems of cost, value, and access throughout our health sector. It is vital to address these problems. But any health reform proposal to change what needs fixing also must preserve the freedom, innovation, and quality of American medical care that people value. We believe a better functioning, more competitive, and transparent marketplace would cover more people and deliver the higher-value care we seek.

We are gravely concerned that several of the proposals offered by the President and the Congressional leadership would make matters worse, not better. These flawed prescriptions for radical change should not be accepted as part of any serious and sustainable health reform proposal:

* A new government health insurance plan

* An employer “play-or-pay” mandate

* A uniform, government-defined package of benefits.

* A mandate that individuals must purchase insurance.

* A National Health Insurance Exchange extending federal regulatory powers over private insurance.

* Federal interference in the practice of medicine through a federal health board, comparative effectiveness review, and other government intrusions into medical decision-making.

We explain below why we believe these ideas would diminish individual Americans’ freedom and control over their personal health decisions.

This is a good bunch, one with whom we’re honored to stand.  If you haven’t already done so, sign the Do No Harm petition.

When Doctors Opt Out – WSJ.comHeres something that has gotten lost in the drive to institute universal health insurance: Health insurance doesnt automatically lead to health care. And with more and more doctors dropping out of one insurance plan or another, especially government plans, there is no guarantee that you will be able to see a physician no matter what coverage you have.

Government run health care will produce fewer choices.  If you get nothing else from this doctor’s Op-Ed, get that.  Insurance/coverage is not the same as access.  And the more the government plans compete with private health care funding (whether out of pocket, private insurance, or private charity) by price-fixing and subsidizing, the fewer health care choices that will be available.

HT:  John Goodman 

ARE YOU PAYING TOO MUCH FOR HEALTH INSURANCE? | National Center for Policy Analysis
Wherever one looks, health care costs are on the rise. The average premium for family coverage has increased 119 percent since 1999. To figure out where singles and families are making the greatest contributions to their employer-sponsored health insurance plans, Forbes magazine looked at data in the 2006 Medical Expenditure Panel Survey, an annual survey that collects information about employer-sponsored health insurance offerings in the United States.

NCPA has a post about high cost of insurance, and the things that affect the cost of health insurance.  High costs related to state and federal regulations are another way that non-insurance options like health care sharing ministries keep costs down.  Because we are a charitable, non-regulated option (though without the guarantees that come with regulated insurance) our members enjoy something closer to a free market, and our costs are substantially less than health insurance.

Our members have the opportunity to consider whether routine care or emergency care are among the needs shared.  They get to vote on whether or not something new and controversial is a part of the ministry sharing, or whether things that are incidental or optional should be shared among the members.  They have control over those things with their choice of membership, and the voting power that the members have.  And so the options are tailored to the members, by the members, and not superceded by a group of government regulators.  The individual consumer gets to choose–which helps keep costs low!