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HEALTH PLANS: Perhaps you shouldn’t click on every Google Ad, with UPDATE on underinsurance

As you may or may not have noticed, in a (mostly failing) attempt to see whether I can make any money back off this blog, I’ve been running Google Adsense down on the left column. A certain commenter, let’s call him Ron, suggested to me that this is an attempt for me to build my own insurance empire. While that may betray Ron’s misunderstanding of how Adsense works (and look here for an amusing version of the same), one of the ads that ended up on THCB was for a very dodgy insurance company that wasn’t so nice.  Take a look and of course caveat emptor.

UPDATE: Meanwhile, Health Affairs today has a Commonwealth Fund study that estimates the number of underinsured at 16 million. By my very casual glance at the Press release it seems that they may only be talking about those with inadequate insurance who actually needed it. My guess is that overall underinsurance (e.g. not having enough to pay the bills in the case of a bad trauma) is much greater.  But then again, it’s the flow of people through un- and under- insurance that’s such a big issue, with more than 80m uninsured for at least 3 months in a 4 year period.

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  1. Rick, you wrote, “I mean, the people’s coverage capped his chemotherapy at $1,000 a day. That’s $365,000 a year. I’d hardly call that poor coverage”
    You sound like one of their salespeople. Also, I would submit that there are more than just a few hundred people that could take one painting off the wall and sell it and pay that amount.
    Matthew the last thing these people need is to focuse on what they are doing. The guy in charge said that this could affect their stock price. They have very deep pockets so at least be aware. The no spin guy, Bill O’Rielly, did commercials for them. Some people will do anything to make a buck.
    Jib is correct that internet marketing of health insurance should be discussed by someone. One of the biggest always has a “basic” plan pop up first with the lowest price. I can just see uninformed consumers say to their husbands, “All we want is basic insurance right?” If basic means that the insurance will pay $300 a day in the hospital and you spend 10 days in the hospital, and the bill is $90,0000, you may be a bit short. What is 10 times $300 anyway?
    Lin you wrote, ” The HSA has to process claims under the deductible because they are paid out of the HSA at the UCR rate.”
    Most people on HSA insurance have a PPO. When a network provider is used there is no UCR rate and the consumer will have no balance billing. Also, the HSA client does not have to pay the claim with HSA funds. Some say, who would take money out of your HSA, that is growing tax free, even if you could. But yes you are correct the claim must be processed so that it can be applied to the deductible. All sorts of people are saying that costs are saved because the insurance company is not involved. Or that the doctor’s office has no need to process HSA claims, not true.
    You are so correct that community rating makes premiums soar, like in New York. That is failed logic that some people spew when we have several examples to prove that they are wrong. Uninsurable people is a different issue than uninsured people or underinsured people.
    I think Matthew is correct that there are more underinsured people than 16 million. The bankrupt stats prove that. It is always pointed out that a large percentage of these people had insurance at the beginning of their claim.
    I also submit that it is not fine print that makes people lose their insurance when they get cancer. In bold print it says, “you will be terminated when you are no longer eligible.” Under eligibility it says, “Owners, partners or employees who are working 30 hours a week at the firm’s regular place of business performing their regular duties are eligible.”
    A proper disclosure would be: WARNING, WARNING WARNING, If you get a head full of brain tumors and can’t work, your insurance will be terminated. If you still want this insurance SIGN HERE X______________.
    Without a full and proper disclosure it is a serious ethics violation under current law.

  2. A market based system that restricts pre-existing refusals, is community( as opposed to experience) rated, and guarantted issue would look like New York – some of the highest rates in the country. Also some of the best hospitals, albeit in a pretty confined area (Manhattan) and many many docs no longer on ANY MC panels.
    The HSA has to process claims under the deductible because they are paid out of the HSA at the UCR rate.
    The great cost driver is all that administration needed to count the beans. When I am speaking to groups I put it this way: Say you are making a banquet for thirty people you don’t know, and you want to charge them what the dinner was worth to each of them. So you buy what you think is needed; some, but not all goods at the best prices you could find. Some things you want to pick your own quality, so you buy the fresh green beans instead of the ones in the can, but the cheap paper towels are good enough, etc etc. And you try very hard to not over buy – in fact, it is better for you to underbuy and not have any leftovers.
    Some people are really really hungry, others are dieting, some just want a normal sized meal that day – they don’t necessarly have control over when this dinner is going to be. Then, as everyone serves their own dinner, you keep track of it all – down to the last bean and the amount of butter on the roll.
    It is that level of bean counting that makes the system unwieldy.
    I have a client that went in for outpatient surgery, but the times as listed on the UB-92 don’t correspond with the timing on the surgical and post surgical notes. CMS says that medical bills must be supported by documentation, so I am recommending that at least a portion of the OR and the RR be removed as they are not documented. This will save my client about $5000. Do I feel bad for the hospital? No. They also coded her for three extra things, including a pregnancy test – and she’s 55 and gay. I don’t feel sorry for them. Hospitals think that counting the beans works for them, so when I find errors, I take ’em for what I can get.
    Lin

  3. Actually, I’m pretty sure that Adwords lets you filter out sponsors you don’t want to be associated with. Probably a good idea to go ahead and do that. People should keep an eye out for any other potential problems and report them.
    I guess thats a good excuse to click on the links and support THCB!
    Anyway, the Internet advertising market for insurance seems like an interesting topic. I’m wondering what kind of oversight there is for companies like this? Do any special regulations apply on the web? I’m betting not many people are paying attention. And that there are lots of lovely loopholes.
    As the anchorman said, “Over to you Ron”

  4. I think the short answer is that our current system so divorces most people from any cost responsibility for their health care that they don’t read the fine print because they haven’t had to go through a worse case cost scenario. Most people shopping the individual market have gotten coverage through employers for most of their adult lives. Faced with the premium cost of low deductible plans they look for lower cost options which may or may not provide the coverage they need and can afford over time.
    People with employer-provided health insurance don’t see a problem because they’ve never had to face the full impact of premium cost or the expense issues driven by a combination high deductible, aggressively underwritten insurance plan. Most are completely inexperienced with the concept of “discount” plans which masquerade as health insurance or any of the other fly-by-night plans which reassure consumers until they file the first claim. I just had a conversation with my mother this weekend. She has Medicare and a great Medicare supplement–her out of pocket cost is 0. Her health insurance was originally provided by the government because she is the divorced spouse of retired Army officer (note that in our current system, retired military members have insurance coverage for any spouse/former spouse of greater than 10 years, but people who serve less than 20 years in the military lose insurance benefits after they get out–even disabled veterans have no coverage for spouses if they served less than 20 years). She hates the idea of any regulation of the insurance industry, any expansion of government provided healthcare or any expansion of low cost medical coverage such as HMOs because she likes her ability to choose her own doctor and is afraid it will increase taxes. In short, she likes her current coverage so she needs no need for change to the system. After four years of self-insuring, I’m ready for any option that provides defined, reasonable cost risk at an affordable premium (which means limited ability for an insurer to exclude pre-existing conditions and stricter regulation of how much premiums can increase over time). I believe that taxes are increasing (I know my property taxes cover the local hospital and that sure goes up every year due to patient payment defaults) because of increasing numbers of uninsured and the situation will only get worse.
    Every time a good conversation gets started on challenges of our current system, Ron jumps in with HSA rhetoric. I recognize that is one option, but I’d love to hear from some of the other people who have started to post on health care reform, because I think some of the issues raised like pricing transparency, greater insurance regulation, single-payer systems, etc. all have a place in this discussion. The real issue is that traditional health insurance is unaffordable for both individuals and increasingly for employers. Just look at GM’s layoff announcement–believe we as taxpayers will pay for that over time. We are developing transition options like HSAs that can easily insure healthy, young individuals but are less attractive to older, rated individuals. We actually have government programs for many segments of the population which supposedly are “affordable” but we shun looking at turning these programs into a single entity which might charge some level of premium across the board vs. providing free care to some, premium/co-pay-based care to others and no care to others. Lack of pricing transparency makes it difficult for consumers to really place competitive pressure on health care providers by shopping around and the whole concept of high deductible policies that process claims that are under the deductible seems like a driver of unnecessary transaction costs. In a country that has a patchwork of state regulations, it is easy for insurance companies to avoid insuring people in heavily regulated states, but I wonder what the market would look like with tighter federal insurance regulation, particularly regulation which limited pre-existing condition exclusions and forced actual cost justification of premium increases. I doubt U.S. insurance companies would abandon the market. They’d adapt.

  5. I’m always conflicted on this kind of story. As you read it, on the one hand you have to ask, why didn’t these folks read the fine print, and why didn’t they remember the old adage that anything that sounds too good to be true probably is. On the other hand, why does ANYTHING cost $18,000 a day? The number of people who can pay cash for that in this country probably only numbers in the hundreds. I mean, the people’s coverage capped his chemotherapy at $1,000 a day. That’s $365,000 a year. I’d hardly call that poor coverage, unless it’s customary for chemotherapy to cost more than that. But then you circle back to the same question, why does it cost so much? Must stop now. Getting dizzy.

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