|
Insurance |
Jack in |
McDonald’s |
Burger King |
Yum! Brands |
Wendy’s/ |
Total |
|
Prudential plc |
|
|
|
80.5 |
|
80.5
|
|
Prudential Financial |
34.1 |
197.2 |
43.7 |
80.5 |
|
355.5
|
|
Mass Mutual |
23.1 |
267.2 |
58.8 |
17.4 |
|
366.5
|
|
New York Life |
2.4 |
|
|
|
|
2.4
|
|
Northwestern Mutual |
40.9 |
318.1 |
|
63.2 |
|
422.2
|
|
Sun Life |
|
|
|
26.8 |
|
26.8 |
|
Standard Life |
|
63.0 |
|
|
|
63.0
|
|
ING |
12.3 |
311.7 |
|
82.1 |
|
406.1 |
|
Manulife |
|
89.1 |
|
53.7 |
3.3 |
146.1
|
|
Guardian Life |
7.2 |
|
|
|
9.5 |
16.7
|
|
MetLife |
|
|
|
|
2.2 |
2.2 |
|
Total |
120.0 |
1,183.3 |
165.5 |
404.2 |
15.0 |
1,888.0 |
Why are insurers buying back their shares?
Health plan profits: Relying on the market
By Emily Berry
American Medical News
April 5, 2010
Boosting earnings per share keeps Wall Street (and shareholders) happy. And in for-profit health insurance, shareholders come first.
When companies have extra cash, they think of the best way to benefit shareholders. “It is a fairly straightforward decision: they have dollars. They could potentially use those to buy new computers, hire new staff, open new markets, increase reimbursement or deliver more services, but in the for-profit world, their first obligation is returns to their owners,” said Joe Paduda, principal for the consulting firm Health Strategy Associates in Madison, Conn.
So how are they making money?
Administrative cost controls play some part. But there are other factors: First, insurers also make money from investing premium dollars, and the returns they make on those investments have stabilized since the market crash of 2008.
The other factor is plans’ billions of dollars worth of share buybacks, which affect the figure Wall Street watches most — earnings per share. Even if cash profits don’t change, per-share earnings will go up, because a company has fewer shares in the market.
Insurers’ investments and share buybacks matter, because they can indirectly affect doctors’ pay. If the market isn’t doing well and investment income drops, insurers feel even more shareholder pressure to raise premiums or cut costs, rather than risk an operating loss. That means less flexibility for doctors in negotiating reimbursements.
“They have less margin for error, because investment returns are so low,” Paduda said. If health plans see higher-than-expected spending, “or they sell a policy to folks who, God forbid, actually get sick, then they’ve got a problem.”
(Dave Shove, a New York-based senior research analyst specializing in managed care for BMO Capital Markets Equity Research Group) said share repurchases are simply a way to reward shareholders. Other options are paying dividends or buying other firms.
But health insurers historically have made very few dividend payments, he said, and “the health insurance business is pretty consolidated now. That just leaves one thing to do, and that is buy back stock, so they’re doing it.”
(Scott Harrington, PhD, professor of health care management at the Wharton School of the University of Pennsylvania) said health insurers, like other companies, have favored share repurchases over paying bigger dividends, in part because the tax code favors repurchases, but also because if shareholder dividends are increased one year then cut the next, the market interprets that as very bad news.
WellPoint Chief Financial Officer Wayne DeVeydt told investors at a March conference that the company plans to spend nearly $4 billion on share repurchases in 2010, following $2.6 billion in 2009.
Not everyone likes the way investments and stock prices drive the U.S. health care system. But short of a single-payer, government-controlled system, health system reform proposals are not aimed at changing this part of the way health insurance companies work.
“This is the world we live in,” Shove said. “These guys are for-profit, and as long as we have insurance companies, we have to live with the consequences of that.”
http://www.ama-assn.org/amednews/2010/04/05/bisa0405.htm
When some of the non-profit Blues insurers converted to for-profit status, the primary reason given for that conversion was to open access to capital markets. What does that mean?
When a shareholder-owned corporation issues new stock, it is allegedly for the purpose of raising capital to expand operations, growing the industry and increasing profits. That is what capitalism is all about.
But when a corporation buys back stock, it is not for the purpose of contracting operations, but rather it is to pump up the per share value. It is not merely a coincidence that this increases the value of the large blocks of shares held by top management and the board of directors, by increasing the percentage of ownership in the company. New stock issues dilute ownership, whereas stock repurchases concentrate ownership.
The funds used to buy back the shares could have been used instead to slow the growth in premiums or to reduce the excessive cost sharing burden created by the shift towards underinsurance products, benefiting their customers – the patients. But no. As this article states, “shareholders come first.”
As Dave Shove states, “”This is the world we live in. These guys are for-profit, and as long as we have insurance companies, we have to live with the consequences of that.”
Perhaps the most important statement in this article: “… short of a single-payer, government-controlled system, health system reform proposals are not aimed at changing this part of the way health insurance companies work.”
The obvious conclusion is that reform should not stop short of a single payer system. We have more work to do.
Forum probes health care
IUN hosts lecture, discussion to help clarify systems, government, structure for taxation
BY CHRISTIN NANCE LAZERUS
Post-Tribune (Merrillville, Ind.), April 2, 2010
GARY — The health care reform bill was adopted last week with great fanfare, but some critics believe the legislation didn’t go far enough.
Indiana University Northwest hosted a lecture and discussion Thursday on why a single-payer system wasn’t seriously considered in the health care debate.
Minority Studies chairman Raoul Contreras said the health care debate illustrated the frustration that ordinary Americans have with government.
“You think you’re involved, but you’re not,” Contreras said. “The only thing that was considered was how do we reform the profit-driven insurance company system. The question I think we should be asking is, do we need these insurance companies?”
Dr. Erlo Roth, a pathologist in Hinsdale, Ill., spoke about what universal health care system would work best in the United States.
Roth became involved with Physicians for a National Health Program about a year ago.
“I’m worried about the way that the health care system has moved in the past 20 or 30 years, not in terms of quality but in the way it’s financed,” Roth said.
Roth said the United States spends about 17 percent of its Gross Domestic Product on health care compared to 8 percent in other developed nations. He said more spending doesn’t yield better health outcomes — the infant and maternal mortality rates in the U.S. lag behind other countries and many uninsured Americans have chronic medical conditions that go untreated.
Roth outlined some of the differences between universal health care systems in Germany, England and Canada.
In Germany, in-surers are private and nonprofit, and are mandated to offer a level of benefits. In England, hospitals are owned by the government and staff are employed by the National Health Service.
Canada’s National Insurance Model works similar to Medicare, with doctors and hospitals staying private.
All of these universal programs are paid for by progressive taxes.
Roth believes the best solution for American health care would be to offer a Medicare-for-all system.
“Doctors and hospitals would remain independent, and drug companies would have to negotiated fees with the government, like the Veterans Administration does,” Roth said.
He said the health care measure signed into law is an important first step toward expanding coverage, but it doesn’t control costs and still leaves about 23 million people without insurance.
Activist Nick Egnatz wondered why a single-payer health care system was never seriously considered by politicians in Washington, D.C. He attributed part of the reason to lobbyists.
“We need representatives that represent us,” he said. “Both political parties are supported by corporate interests.
“There’s something wrong with a system that doesn’t take care of everyone.”
http://www.post-trib.com/news/2136566,healthcare0402.article
Pushing WellPoint back to nonprofit?
By Linda Greene
Bloomington Alternative, April 4, 2010
When it comes to health care reform, single-payer advocate Rob Stone, M.D., says, “We’re still for it, and we’re not done yet.”
The need is undeniable. Over 46 million Americans are uninsured, and a recent study reported in the American Journal of Public Health showed that 45,000 die each year because they lack health insurance. Tens of millions are underinsured, able to afford coverage only with policies with gigantic deductibles and out-of-pocket expenses.
Of U.S. health care spending, 31 percent covers administrative costs, or overhead. Medicare, in comparison, spends only 3.1 percent on overhead. According to the Organization for Economic Cooperation and Development, countries with universal health care spend about 50 percent of what we spend per capita and have superior health outcomes.
***
Stone, an emergency physician at Bloomington Hospital, director of Hoosiers for a Commonsense Health Plan (HCHP) and board member of Physicians for a National Health Plan, is working on a two-pronged campaign for changing the health care status quo.
One is an “inside” approach, offering a resolution for the health insurance company WellPoint stockholders to vote on. The resolution calls for WellPoint to study the feasibility of returning to its nonprofit status.
Several shareholders, including Stone, have successfully placed the resolution on WellPoint’s proxy statement, released this week and to be voted on at WellPoint’s annual stockholders’ meeting on May 18 in Indianapolis.
The resolution also asserts that “no country has achieved universal health care through for-profit health insurance. … WellPoint was a nonprofit insurance company before it demutualized, raised capital through stock offerings, merged with, acquired, and demutualized other nonprofit Blue Cross/Blue Shield companies [in the early ’90s].”
With its for-profit status, WellPoint has changed its focus from patient care to profits for its stockholders.
Hoosier health care activists are targeting WellPoint because it’s the largest corporation in the health insurance industry and has headquarters in Indianapolis. Further, WellPoint is a leader in the industry in marketing high-deductible policies.
The resolution, which has been presented to the stockholders for a vote by proxy, needs to receive 3 percent of the votes for it to be considered for a second year. If it receives 10 percent of the votes the second year, it can be introduced third year.
The health insurance industry is vulnerable. Lately it’s received negative publicity about policy cost increases. In her recent testimony on those increases before Congress, WellPoint’s CEO, Angela Braly, whose salary is $9 million per year, left an unfavorable impression of the corporation. WellPoint’s reputation has suffered also as a result of the negative publicity surrounding its efforts to oppose health care reform.
***
Two, the “outside” approach, is divestment of stock from the for-profit health insurance industry as a whole. Investors can use divestment, the selling of stock and thus the opposite of investment, to protest particular corporate policies.
“Divestment,” according to Stone, “is an economic and political tool that puts political pressure on corporations to change their policies.”
The idea for divesting from the health insurance industry originated with Kurt Edelman, from the Service Employees International Union, during an activists’ conference call about the industry.
Divestment from the health care industry has, as its model, divestment from South Africa during its racist, apartheid regime. Then, divestment entailed persuading companies to cease doing business in South Africa in protest the regime.
Although health care activists’ goal is complete divestment of stock in the publicly traded health insurance industry, in Stone’s words, the industry is a “parasitic middleman that increases cost and complexity, with no value added.”
The starting point is WellPoint. Last year a WellPoint shareholders’ resolution calling on the company to divulge the pay given to executives almost passed, with 46 percent of the votes. It could pass this year, according to Stone.
One avenue Stone and his fellow activists are exploring is mutual funds that own stock in WellPoint. TIAA-CREF, in which many teachers and college professors have investments for their pensions, is the 12th largest stockholder in WellPoint and holds 5 million shares of WellPoint, worth about $320 billion.
Stone figures people in the teaching profession are more likely than some others to be sympathetic to a divestment campaign. The aim is to weaken the health insurance industry, and academics can put pressure on their employers to divest.
***
Single-payer advocates and proponents of a public option, as Stone says, are “let down, worn out and disappointed” in the current health care “reform.” But he adds immediately, “The antidote to despair is action.”
Stone said HCHP will release the resolution during a press conference at 11 a.m. on Wed., April 7, in front of WellPoint’s headquarters on Monument Circle in Indianapolis. The public is welcome to attend.
Attending a rally in front of WellPoint headquarters at 11 a.m. on Tuesday, May 18, after WellPoint’s annual stockholders meeting, is even more important, Stone said.
The point of the rally is to draw attention to WellPoint’s current negative public relations and to build a campaign to expose the problems with for-profit health insurance.
At the rally singer-songwriter Carrie Newcomer will perform, and the speakers will include Wendell Potter, a former vice president of communications for the health insurance company Cigna. He was in charge of running a campaign to discredit Michael Moore’s film Sicko, but he switched sides in the health care debate after observing hundreds of people without health care wait for care at a free clinic in Appalachia.
Linda Greene can be reached at lgreene@bloomington.in.us.
***
For more information
E-mail Rob Stone at rstone@hchp.info.
http://www.bloomingtonalternative.com/node/10358
Hospital executives rank United HealthCare and WellPoint/Anthem as worst
Fourth Annual National Survey of Hospital Executives Reveals "Best" and "Worst" Among the Nation's Insurance companies
Revive Public Relations
March 31, 2010
Revive, a national public relations firm specializing in Health Care and Healthy Living, today released the results of its fourth annual National Payor Survey of hospital executives. The only one of its kind in the country, the survey targeted hospital leaders in the industry who negotiate managed care contracts with national health insurance companies – CEOs, CFOs, and directors of managed care.
The survey gathered data on hospital leaders’ opinions on seven of the largest health insurers or insurer groups in the nation: United HealthCare, CIGNA, Aetna, Coventry, Humana, Wellpoint/Anthem, and the local state or regional independent non-profit Blue Cross or Blue Shield plan.
While all respondents tend to regard insurance companies as equally negative when it comes to business practices, each year’s survey has revealed United HealthCare as the clear outlier. For four years, United HealthCare has been consistently ranked as the worst among respondents in all survey categories and a clear trend has emerged. This year, WellPoint/Anthem saw declines that brought the company down to levels near United HealthCare.
http://www.revivepublicrelations.com/downloads/2010PayorSurveyPressRelease.pdf
Words hospitals used to describe United HealthCare:
17% – Bad/Negative
15% – Inflexible/Rigid/Unreasonable
13% – Challenging
13% – Deceptive/Dishonest/Unethical
8% – Aggressive/Bully
and
11% – Good/Fine
2% – Prompt
2% – Convenient/Easy
1% – Professional
(Similar terms were used to describe other insurers, including WellPoint/Anthem)
http://www.revivepublicrelations.com/downloads/2010PayorSurveyResults.pdf
Comment:
By Don McCanne, MD
From the perspective of hospital executives, the two worst insurers in the nation happen to be the largest – United HealthCare and WellPoint/Anthem, even though “all respondents tend to regard insurance companies as equally negative when it comes to business practices.”
And now we have reform that not only locks us into this industry, but expands it further!? It can be changed.
Hospital executives rank United HealthCare and WellPoint/Anthem as worst
Fourth Annual National Survey of Hospital Executives Reveals “Best” and “Worst” Among the Nation’s Insurance companies
Revive Public Relations
March 31, 2010
Revive, a national public relations firm specializing in Health Care and Healthy Living, today released the results of its fourth annual National Payor Survey of hospital executives. The only one of its kind in the country, the survey targeted hospital leaders in the industry who negotiate managed care contracts with national health insurance companies – CEOs, CFOs, and directors of managed care.
The survey gathered data on hospital leaders’ opinions on seven of the largest health insurers or insurer groups in the nation: United HealthCare, CIGNA, Aetna, Coventry, Humana, Wellpoint/Anthem, and the local state or regional independent non-profit Blue Cross or Blue Shield plan.
While all respondents tend to regard insurance companies as equally negative when it comes to business practices, each year’s survey has revealed United HealthCare as the clear outlier. For four years, United HealthCare has been consistently ranked as the worst among respondents in all survey categories and a clear trend has emerged. This year, WellPoint/Anthem saw declines that brought the company down to levels near United HealthCare.
http://www.revivepublicrelations.com/downloads/2010PayorSurveyPressRelease.pdf
Words hospitals used to describe United HealthCare:
17% – Bad/Negative
15% – Inflexible/Rigid/Unreasonable
13% – Challenging
13% – Deceptive/Dishonest/Unethical
8% – Aggressive/Bully
and
11% – Good/Fine
2% – Prompt
2% – Convenient/Easy
1% – Professional
(Similar terms were used to describe other insurers, including WellPoint/Anthem)
http://www.revivepublicrelations.com/downloads/2010PayorSurveyResults.pdf
From the perspective of hospital executives, the two worst insurers in the nation happen to be the largest – United HealthCare and WellPoint/Anthem, even though “all respondents tend to regard insurance companies as equally negative when it comes to business practices.”
And now we have reform that not only locks us into this industry, but expands it further!? It can be changed.
Gaming the individual mandate
Short-term customers boosting health costs
By Kay Lazar
The Boston Globe
April 4, 2010
Thousands of consumers are gaming Massachusetts’ 2006 health insurance law by buying insurance when they need to cover pricey medical care, such as fertility treatments and knee surgery, and then swiftly dropping coverage, a practice that insurance executives say is driving up costs for other people and small businesses.
In 2009 alone, 936 people signed up for coverage with Blue Cross and Blue Shield of Massachusetts for three months or less and ran up claims of more than $1,000 per month while in the plan. Their medical spending while insured was more than four times the average for consumers who buy coverage on their own and retain it in a normal fashion, according to data the state’s largest private insurer provided the Globe.
The typical monthly premium for these short-term members was $400, but their average claims exceeded $2,200 per month.
The problem is, it is less expensive for consumers — especially young and healthy people — to pay the monthly penalty of as much as $93 imposed under the state law for not having insurance, than to buy the coverage year-round. This is also the case under the federal health care overhaul legislation signed by the president, insurers say.
Comment:
By Don McCanne, MD
Health policy science told us ahead of time that a mandate for individuals to buy private health insurance would not work if the penalties for not doing so were quite modest. Yet Massachusetts enacted such a plan, and now very similar policies have been enacted into federal law.
The Massachusetts experience has demonstrated that health care consumers will act in their own financial interest. Individuals who perceive themselves to be in good health will elect to pay the much lower penalty for being uninsured. If they then develop expensive medical problems, they will sign up for a health plan, but then will drop their coverage after their medical needs are met. It means little to them that this drives up premiums for those who remain in the insurance pools.
There are legitimate reasons that state and federal legislators have been reluctant to assign greater penalties for not being insured. The most important is that insurance premiums are simply not affordable for moderate income individuals who do not receive adequate public or employer assistance. Even the modest penalties create a financial hardship for some. Pushing the penalties higher would compound the financial stresses that too many middle income families are already experiencing.
There are policy interventions available, but those under consideration are based on leaving the private insurance industry in charge. One suggestion is to close enrollment except for a short period of open enrollment once or twice a year. This would leave already financially strapped individuals without a safety valve should problems arise during closed enrollment periods. Another suggestion would be to reinstitute (Massachusetts) or expand (federal) the waiting period before preexisting disorders are covered, even if of very recent onset, again preventing coverage for more urgent, serious problems.
Though some might suggest that these individuals would be getting what they deserve for not being insured, the real fault is with policies inherent in the design of a financing system based on private insurance plans. Individuals are forced to choose between private insurance coverage that they may not be able to afford, or exposing themselves to the potential of greater financial insecurity by remaining uninsured. If solving problems in a system creates new problems, then we should question the system itself.
We can do this far better. We can separate the financing from the delivery of health care. With a single payer, improved Medicare for all, everyone would be automatically covered, for life. The financing of the system would not be through premiums tagged to private plans, but rather would be through progressive tax policies in which each person would pay an equitable share, and no one would face a financial hardship.
Gaming the individual mandate is not a very fun game. Let’s shut it down, and change to a system that works for everyone.
The hype behind the healthcare reform bill
By Dr. James C. Mitchiner
Guest column
AnnArbor.com, April 4, 2010
In the weeks and months ahead, Americans will learn the true details about the health care reform bill passed by the U.S. House on March 21 and signed into law by President Obama two days later. They may not like what they see. If ever there was March Madness, this surely must be it.
Lost in all the hype and self-congratulatory rhetoric repeated by Speaker Nancy Pelosi and her Democratic colleagues are the facts that brought us to the passage of this flawed legislation.
Here are a few:
• Of the 32 million Americans who will gain coverage under this law, about 16 million will be covered by Medicaid. Here in financially strapped Michigan, with the recent 8 percent reduction in Medicaid reimbursement to doctors and the looming possibility of an additional 11 percent cut, the already dwindling Medicaid participation rate among physicians will decrease further. The result will confirm what we have learned from health reform in Massachusetts: access to health insurance in no way guarantees access to actual health care. Waits to see a physician will increase, and emergency rooms will become jammed more than they already are.
• Millions of middle-income citizens will be herded into buying private health insurance policies costing up to 9.5 percent of their annual income while covering on average only 70 percent of their medical expenses, leaving them responsible for high co-pays and deductibles. Such a “benefit” will not provide them with the necessary financial security should they fall victim to a catastrophic illness or injury.
• Health insurance firms are likely to garner over $400 billion in federal assistance, courtesy of American taxpayers, to subsidize the purchase of their defective products. Moreover, since the newly insured are likely to be young and healthy, and therefore less risky to insure, private insurers will be guaranteed continued profits which will be used to extend their political clout and inhibit future reforms.
• Workers who currently receive coverage from their employer will be restricted to using their plan’s limited network of providers. As the cost of their insurance climbs, many will eventually be taxed on the value of their benefits.
• Optimistic projections that the reform law will reduce the federal deficit are based on wishful thinking and untested theories. As the experience with the Massachusetts reform plan (the model for this bill) has amply demonstrated, health care costs will continue to escalate.
• The much-ballyhooed regulatory reforms in commercial insurance, such as prohibiting denials on the basis of pre-existing conditions, were crafted with the assistance of the insurers themselves, casting doubt on their true effectiveness. Older people, for example, can be charged up to three times more than their younger counterparts, and female employees can be charged higher rates at least until 2017.
This bill’s passage is grounded on base political pragmatism rather than sound health care policy. It leaves intact the fragmented and unsustainable system that is wreaking havoc on our health and economy today, a system that generates up to $400 billion annually in wasteful administrative costs. According to Physicians for a National Health Program, an organization representing over 17,000 single-payer physician advocates, that’s enough to cover all the uninsured and to upgrade everyone else’s coverage without having to increase overall U.S. health spending by one dollar.
So, in the coming years, we will be forced to muddle through the dysfunctional mess that epitomizes American health care. But it is only a matter of time before future legislators will survey the damage done and conclude that only the adoption of a single-payer national health insurance program – an expanded and improved Medicare-for-All – will guarantee coverage for Americans that is universal, portable, affordable, and equitable for all.
Dr. James Mitchiner is an Ann Arbor emergency physician and is the former president of the Washtenaw County Medical Society.
http://www.annarbor.com/news/opinion/the-hype-behind-the-healthcare-reform-bill/
Retail politics' could offer better health plan
By Joseph Jarvis
Salt Lake City Tribune, April 2, 2010
Sen. Bob Bennett commented recently in The New York Times that he was expecting to play “retail politics” from now until the Utah Republican Convention on May 8. Well, Sen. Bennett, I am an uncommitted state delegate and I’m waiting for you and your competitors to sell me on your candidacy.
Since former Gov. Jon Huntsman introduced me to Sen. John McCain, then running for the presidency, as Utah’s foremost authority on health system reform (thanks, Jon, flattery is nice, even if cheap), I’m particularly interested in hearing about how Utah’s future congressional representatives (I’ll include the Republican candidates vying to replace Rep. Jim Matheson) will respond to the passage of Obamacare.
I’m not interested in sound bites. Ideological nonsense from both sides of the political aisle is what made the passage of Obamacare happen. Republicans made virtually no effort to bring substance into the debates about health care reform, so let’s not continue pretending that selling health insurance across state lines will fix our health system. Yes, we need malpractice reform. The question is, should Congress be involved? If so, how?
Not so long ago, a number of Democratic members of the U.S. House were running a bill entitled “The States’ Right to Innovate in Healthcare Act.” I loved that bill. It laid out mechanisms for any state to negotiate its way out of federal rules and regulations en route to formulating its own comprehensive reform of health care delivery and financing. Now that Obamacare is the law of the land, states that can do better need the right more than ever to innovate in health care.
The only trouble with that bill was (and is) that no Republican ever signed on as a sponsor. What I want from congressional candidates is a commitment to spend time and political capital resurrecting that bill with a bipartisan coalition backing it.
Many Democrat members of Congress are just as unhappy with the recently passed health legislation as am I. In expressing their frustration, they have stated their support for empowering states to take on health system reform. To be sure, their support for this concept originates from their desire to see some state pass a form of government-based single-payer health care.
I want Republican candidates for Congress in Utah who will support the bill even if it makes single-payer legislation possible in California (where it passed the state legislature twice already). If the bill empowers California to try a government-sponsored version of single-payer health financing, it will empower Utah to try something else.
I’m also interested in finding Republican congressional candidates in Utah who are true fiscal conservatives when it comes to health care.
The entitlements in health care that are killing the federal budget are not those given to senior citizens on Medicare or poorer members of society on Medicaid, but those granted repeatedly to Big Pharma and the health insurance industry, who sell their products to our government programs at a ridiculous profit.
Why is it that the manufacturers of motorized wheelchairs can advertise on TV that they can automatically qualify any person on Medicare for their product? I want someone in Congress with the backbone to say no to corporate welfare in our health care system.
Any other uncommitted Republican state delegates who want to join me in retail politics can e-mail their questions for candidates to jqjarvis@gmail.com.
Joseph Jarvis is a member of the Republican State Central Committee and chairman of legislative District 24. He was twice a Republican nominee for the Legislature. He founded and chairs the Utah Healthcare Initiative, a political issue committee, which exists to bring comprehensive health system reform to Utah by ballot initiative.
Retail politics’ could offer better health plan
By Joseph Jarvis
Salt Lake City Tribune, April 2, 2010
Sen. Bob Bennett commented recently in The New York Times that he was expecting to play “retail politics” from now until the Utah Republican Convention on May 8. Well, Sen. Bennett, I am an uncommitted state delegate and I’m waiting for you and your competitors to sell me on your candidacy.
Since former Gov. Jon Huntsman introduced me to Sen. John McCain, then running for the presidency, as Utah’s foremost authority on health system reform (thanks, Jon, flattery is nice, even if cheap), I’m particularly interested in hearing about how Utah’s future congressional representatives (I’ll include the Republican candidates vying to replace Rep. Jim Matheson) will respond to the passage of Obamacare.
I’m not interested in sound bites. Ideological nonsense from both sides of the political aisle is what made the passage of Obamacare happen. Republicans made virtually no effort to bring substance into the debates about health care reform, so let’s not continue pretending that selling health insurance across state lines will fix our health system. Yes, we need malpractice reform. The question is, should Congress be involved? If so, how?
Not so long ago, a number of Democratic members of the U.S. House were running a bill entitled “The States’ Right to Innovate in Healthcare Act.” I loved that bill. It laid out mechanisms for any state to negotiate its way out of federal rules and regulations en route to formulating its own comprehensive reform of health care delivery and financing. Now that Obamacare is the law of the land, states that can do better need the right more than ever to innovate in health care.
The only trouble with that bill was (and is) that no Republican ever signed on as a sponsor. What I want from congressional candidates is a commitment to spend time and political capital resurrecting that bill with a bipartisan coalition backing it.
Many Democrat members of Congress are just as unhappy with the recently passed health legislation as am I. In expressing their frustration, they have stated their support for empowering states to take on health system reform. To be sure, their support for this concept originates from their desire to see some state pass a form of government-based single-payer health care.
I want Republican candidates for Congress in Utah who will support the bill even if it makes single-payer legislation possible in California (where it passed the state legislature twice already). If the bill empowers California to try a government-sponsored version of single-payer health financing, it will empower Utah to try something else.
I’m also interested in finding Republican congressional candidates in Utah who are true fiscal conservatives when it comes to health care.
The entitlements in health care that are killing the federal budget are not those given to senior citizens on Medicare or poorer members of society on Medicaid, but those granted repeatedly to Big Pharma and the health insurance industry, who sell their products to our government programs at a ridiculous profit.
Why is it that the manufacturers of motorized wheelchairs can advertise on TV that they can automatically qualify any person on Medicare for their product? I want someone in Congress with the backbone to say no to corporate welfare in our health care system.
Any other uncommitted Republican state delegates who want to join me in retail politics can e-mail their questions for candidates to jqjarvis@gmail.com.
Joseph Jarvis is a member of the Republican State Central Committee and chairman of legislative District 24. He was twice a Republican nominee for the Legislature. He founded and chairs the Utah Healthcare Initiative, a political issue committee, which exists to bring comprehensive health system reform to Utah by ballot initiative.
Gaming the individual mandate
Short-term customers boosting health costs
By Kay Lazar
The Boston Globe
April 4, 2010
Thousands of consumers are gaming Massachusetts’ 2006 health insurance law by buying insurance when they need to cover pricey medical care, such as fertility treatments and knee surgery, and then swiftly dropping coverage, a practice that insurance executives say is driving up costs for other people and small businesses.
In 2009 alone, 936 people signed up for coverage with Blue Cross and Blue Shield of Massachusetts for three months or less and ran up claims of more than $1,000 per month while in the plan. Their medical spending while insured was more than four times the average for consumers who buy coverage on their own and retain it in a normal fashion, according to data the state’s largest private insurer provided the Globe.
The typical monthly premium for these short-term members was $400, but their average claims exceeded $2,200 per month.
The problem is, it is less expensive for consumers — especially young and healthy people — to pay the monthly penalty of as much as $93 imposed under the state law for not having insurance, than to buy the coverage year-round. This is also the case under the federal health care overhaul legislation signed by the president, insurers say.
http://www.boston.com/news/health/articles/2010/04/04/short_term_customers_boosting_health_costs/?page=full
Health policy science told us ahead of time that a mandate for individuals to buy private health insurance would not work if the penalties for not doing so were quite modest. Yet Massachusetts enacted such a plan, and now very similar policies have been enacted into federal law.
The Massachusetts experience has demonstrated that health care consumers will act in their own financial interest. Individuals who perceive themselves to be in good health will elect to pay the much lower penalty for being uninsured. If they then develop expensive medical problems, they will sign up for a health plan, but then will drop their coverage after their medical needs are met. It means little to them that this drives up premiums for those who remain in the insurance pools.
There are legitimate reasons that state and federal legislators have been reluctant to assign greater penalties for not being insured. The most important is that insurance premiums are simply not affordable for moderate income individuals who do not receive adequate public or employer assistance. Even the modest penalties create a financial hardship for some. Pushing the penalties higher would compound the financial stresses that too many middle income families are already experiencing.
There are policy interventions available, but those under consideration are based on leaving the private insurance industry in charge. One suggestion is to close enrollment except for a short period of open enrollment once or twice a year. This would leave already financially strapped individuals without a safety valve should problems arise during closed enrollment periods. Another suggestion would be to reinstitute (Massachusetts) or expand (federal) the waiting period before preexisting disorders are covered, even if of very recent onset, again preventing coverage for more urgent, serious problems.
Though some might suggest that these individuals would be getting what they deserve for not being insured, the real fault is with policies inherent in the design of a financing system based on private insurance plans. Individuals are forced to choose between private insurance coverage that they may not be able to afford, or exposing themselves to the potential of greater financial insecurity by remaining uninsured. If solving problems in a system creates new problems, then we should question the system itself.
We can do this far better. We can separate the financing from the delivery of health care. With a single payer, improved Medicare for all, everyone would be automatically covered, for life. The financing of the system would not be through premiums tagged to private plans, but rather would be through progressive tax policies in which each person would pay an equitable share, and no one would face a financial hardship.
Gaming the individual mandate is not a very fun game. Let’s shut it down, and change to a system that works for everyone.
Fighting Illini: Because Illinois Wants More Than Insurance for All
Undaunted: Movement for Improved Medicare for All Grows in Illinois and Across the Nation
By Donna Smith
Guaranteed Healthcare Blog
March 29, 2010
Just blocks from President Obama’s Hyde Park home south of the Loop in Chicago, more than 70 activists gathered on Saturday, March 27, 2010, to plan strategy for advancing an improved and expanded Medicare for all system as the law of the land. Activists across the nation are undaunted by the passage of the current health reform bill as they know that mandating the purchase of private insurance is not the same as providing access to healthcare.
Joining the activists from throughout Illinois was Illinois State Representative Mary Flowers, chief sponsor of Illinois’ single-payer health reform bill HB311, seen in the photo on the left.
By sharing their successes in advancing the Medicare for all, single-payer position, the activists spent eight hours together, broke into issue panels and came away with the formation of four task forces to explore the most effective and strategic ways to move the movement in Illinois both in terms of state legislative energy and as part of a larger national movement.
Among the engaged activists were nurses from various practice settings and locations throughout the state. Many have seen drastic cuts to programs and services in their communities, and as patient advocates remain firmly committed to restoring not only those programs and services cut but also improving and enhancing patient access and care until a single standard of high quality care is the law of the Land of Lincoln and the Land of Obama. HB311, The Health Illinois Act, would assure RNs in Illinois that no patient would be turned away because they lacked insurance, lacked adequate cash to self-pay or had been denied treatment by an insurance company.
Nurses will serve on each of the four task forces created: legislative, media, labor and direct action. The legislative task force will assess the work necessary on Illinois’ elected officials — both state and federal — to help advise other single-payer reform supporting groups how best to motivate those in office to support and defend HB311 and national improved and expanded Medicare for all and how to select and target campaigns of those wishing to be elected in Illinois to make sure those candidates are single-payer solid. The media task force plans to do outreach to local and regional media to develop better lines of communication and enhance chances for coverage of single-payer issues and also make good use of the members within the Illinois Single Payer Coalition who create media on the web and beyond. The labor task force will work with local labor bodies to enhance advancement of the AFL-CIO’s Resolution 34 supporting single-payer reform and will research becoming a part of the national Labor Campaign for Single-Payer. And the direct action task force will continue seeking effective settings in which to challenge the power of the profit engine — private insurance, big Pharma, corporate healthcare providers, etc — with those actions which will advance the cause of single-payer reform.
Also on hand for the day was Dr. Quentin Young of Physicians for a National Health Program. Dr. Young is a long time resident of Hyde Park, and PNHP has its national office in Chicago. Katie Robbins of Healthcare-Now was also in from Philadelphia and New York and facilitated the meeting. Several members of Progressive Democrats of America’s Chicago chapter helped plan the meeting, as did members of the local and state Green Party along with members of CHI-SPAN, the Chicago Single Payer Action Network, a wonderful group of people from Access Living in Chicago, Health Care for All Illinois (HCAI) members, the Champaign County Health Care Consumers, and a strong contingent of activists from Springfield and from East St. Louis, IL. Every group worked cooperatively and with purpose to celebrate the path forward for all who believe that healthcare as a basic human right applies to every person — not just those with money or influence or both.
The event was hosted by the Illinois Single Payer Coalition with tremendous support offered by Dr. Anne Sheetz, who always lends her intelligence and humanity to the effort to transform healthcare for all in her state.
My participation was complete joy in seeing a movement that has been insistently advancing for the past several months firmly plan next steps and remain undaunted by whatever the political turmoil and tumult in DC.
My home state — and my beloved Chicago — can do so much to entrench common Midwestern values about right and wrong and human decency into a healthcare discussion that all too often is focused on revenues and denials and everything but good health for all.
Onward, Illinois. Onward.