Last week my hypochondriac cousin told me about her latest ailments – all of which to me sounded like a sinus headache. However, she wasn’t convinced. So she sought out and visited a neurologist, and an MRI later, it was determined that it was just that – a sinus infection.
Her concern is well-founded in many ways (our family has all sorts of strange disorders) but this time, a lot of money was spent for a diagnosis that a family doc could have easily given without the extras. Which got me thinking – if we expect the health care system to pay for any treatment we want, shouldn’t we expect to put more money into it?
Any other time we want extras, we pay: extra computer memory, higher price tag; silk instead of polyester, higher price tag; leather interior on that car, higher price tag. This is true for almost any consumer good or service you can imagine. So why would we expect it to be any different for health care?
It’s simple –if we want more on the front, we’ll have to pay more on the back end.
As we know, last week Congress passed historic legislation regarding health care. Many components of the legislation should be applauded, but there is still one area that I think falls short – addressing the rising cost of health care.
Doctors in this New York Times article come right out and say the health care reform bill gives them no reason to say “No” to people like my cousin who insist on a needless MRI – multiplied millions of times, that drives up health costs for all of us.
Until the system gives them that reason, it’s up to each of us – what can we do about the rising cost of health care? Here’s some ideas in these Five Questions.
Tuesday, March 30, 2010
Thursday, March 25, 2010
Why does my premium cost so much?
Health insurance was born on the concept of neighbors ‘pooling’ their money together to take care of one another. It was this idea - formed in the early 1900s – that brought communities together to help each other pay for medical treatments they couldn’t afford otherwise.
As is today, usage of this pooled money varied among members – some were sicker than others and needed more care. But everyone supported each other.
Like you, I budget to pay my bills – mortgage, food, utilities, child care, and even health insurance. So when my premium goes up (yes even though I work for a health insurer that even happens to me!) I want to know why.
So I did some research. Here’s a great summary that helped me understand it in a few easy steps:
START with the average amount of claims paid out in the previous year,
ADD doctor, hospital and facility rates, medical trend costs (such as an aging population), then
SUBTRACT adjustments for shock events like pandemic flu or hurricanes and that number
EQUALS the average claim costs expected for the upcoming year. Now,
ADD insurer administrative costs (like how much it costs to run Customer Service lines), and
DIVIDE BY the number of members the health insurer has, which
EQUALS the premium amount to be paid by members
Want to learn more? Visit WhatsTheRealCost.org and be connected to Policy Pricing 101.
As is today, usage of this pooled money varied among members – some were sicker than others and needed more care. But everyone supported each other.
Like you, I budget to pay my bills – mortgage, food, utilities, child care, and even health insurance. So when my premium goes up (yes even though I work for a health insurer that even happens to me!) I want to know why.
So I did some research. Here’s a great summary that helped me understand it in a few easy steps:
START with the average amount of claims paid out in the previous year,
ADD doctor, hospital and facility rates, medical trend costs (such as an aging population), then
SUBTRACT adjustments for shock events like pandemic flu or hurricanes and that number
EQUALS the average claim costs expected for the upcoming year. Now,
ADD insurer administrative costs (like how much it costs to run Customer Service lines), and
DIVIDE BY the number of members the health insurer has, which
EQUALS the premium amount to be paid by members
Want to learn more? Visit WhatsTheRealCost.org and be connected to Policy Pricing 101.
Monday, March 22, 2010
Health Care Reform 101: So what is it? And what's it mean for me?
Check out your local or national news sources, open your Facebook and Twitter accounts, and walk into your nearest coffee shop – the talk is on the House’s historic health reform package passage last night.
In fact, nothing of this magnitude has touched our health care system since Medicare and Medicaid in the 60’s. And while it is the talk of the town… many don’t really know what the current legislation means for them, their families, or their country.
So what’s in the bill? Here are some of the “Cliff Notes”:
•Extends coverage to another 32 million Americans over the next 10 years. How? By making it easier to qualify for Medicaid; and providing subsidies (money the government gives you without any promise of paying it back) for low income individuals and families to buy insurance.
•Requires all Americans to buy health insurance or face a yearly penalty. The initial penalty (starting in 2014) will be $95. By 2016, the penalty would be either: a flat fee of $695 or 2.5 percent of your income.
•Employers not offering coverage could pay up to $2,000 per worker as a penalty.
•Bans insurers from denying coverage to people with preexisting medical conditions (begins in 2014) and a requirement that adult children be permitted to stay on their parents' policies until age 26 (begins this year).
•Taxes on high-cost insurance plans (often referred to as “Cadillac” plans) beginning in 2018. Applies to health plans that cost more than $10,200 a year for individuals and $23,000 a year for families.
•Any individual making above $200,000 or couples making above $250,000, pay increased taxes on their income.
•Insurers face more federal regulation and a new premium tax starting in 2014.
•$250 million has been allotted to fight waste, fraud and abuse.
So what’s NOT in the bill?
The elephant in the room is cost containment. The bill does not fully address how to slow the inherent, rising cost of health care.
Technology is more expensive; we’re using services at an increasing rate; Americans have chronic conditions that require not only prevention by physicians but lifestyle changes by patients; and the cost of pharmaceuticals like biologics (like the medicines used to treat cancer) keep increasing – just to name a few.
You can learn more about the bill and hear other Americans’ opinions on it by visiting the following sources:
MSNBC- what Americans really think about health care reform
Health Care Reform – What it is and isn’t
So it passed. What happens now?
In short,a new era in America’s health care system is underway. While many effects of the bill won’t be felt for a few years, the transition is beginning.
Learn more about rising health care costs and what you can do as a consumer to contain them. Visit www.WhatsTheRealCost.org.
In fact, nothing of this magnitude has touched our health care system since Medicare and Medicaid in the 60’s. And while it is the talk of the town… many don’t really know what the current legislation means for them, their families, or their country.
So what’s in the bill? Here are some of the “Cliff Notes”:
•Extends coverage to another 32 million Americans over the next 10 years. How? By making it easier to qualify for Medicaid; and providing subsidies (money the government gives you without any promise of paying it back) for low income individuals and families to buy insurance.
•Requires all Americans to buy health insurance or face a yearly penalty. The initial penalty (starting in 2014) will be $95. By 2016, the penalty would be either: a flat fee of $695 or 2.5 percent of your income.
•Employers not offering coverage could pay up to $2,000 per worker as a penalty.
•Bans insurers from denying coverage to people with preexisting medical conditions (begins in 2014) and a requirement that adult children be permitted to stay on their parents' policies until age 26 (begins this year).
•Taxes on high-cost insurance plans (often referred to as “Cadillac” plans) beginning in 2018. Applies to health plans that cost more than $10,200 a year for individuals and $23,000 a year for families.
•Any individual making above $200,000 or couples making above $250,000, pay increased taxes on their income.
•Insurers face more federal regulation and a new premium tax starting in 2014.
•$250 million has been allotted to fight waste, fraud and abuse.
So what’s NOT in the bill?
The elephant in the room is cost containment. The bill does not fully address how to slow the inherent, rising cost of health care.
Technology is more expensive; we’re using services at an increasing rate; Americans have chronic conditions that require not only prevention by physicians but lifestyle changes by patients; and the cost of pharmaceuticals like biologics (like the medicines used to treat cancer) keep increasing – just to name a few.
You can learn more about the bill and hear other Americans’ opinions on it by visiting the following sources:
MSNBC- what Americans really think about health care reform
Health Care Reform – What it is and isn’t
So it passed. What happens now?
In short,a new era in America’s health care system is underway. While many effects of the bill won’t be felt for a few years, the transition is beginning.
Learn more about rising health care costs and what you can do as a consumer to contain them. Visit www.WhatsTheRealCost.org.
Tuesday, March 16, 2010
The Kind of Reform Americans Want
Turn on any news channel this week and you’ll hear predictions about how many votes the Democrats have – or don’t have - to pass Obama’s health care reform bill.
Interestingly, if the bill passes, history will write that this Congress passed a historic health care package, marking this a time in history to remember – and it’s likely no one will remember how it came to pass. The debate on the process will be forgotten. Similar to former President Clinton’s economic legislation – thought to be passed by a landslide – when actually it was Vice President Al Gore who was the one to cast the deciding vote.
It’s during these times in America’s history that we learn more about the legislative process than we ever cared to – which is why we don’t remember it later.
But for me, this time seems more important than others. Maybe it’s because more Americans than I care to think about are out of work. Or maybe it’s because I work for an insurance company. Honestly, I think for me it’s a combination of both.
Regardless, it’s got me thinking… and I’m sure it’s got you thinking too. About what the heart of the issue is. About why we care so much. And about what’s at stake. In these times, I believe it’s not just our health that’s at stake. It’s our economic well-being, and the kind of problems we could pass on to our kids, and their kids, and their kids, and so on.
The stakes are high this time – and maybe we won’t remember the process, but we’ll sure remember the result. So I hope this Congress gets it right. I hope they understand what is really driving health care costs up for all of us, and making health coverage so unaffordable… rising medical costs.
In my opinion, current legislation isn’t going to bring down rising medical costs, or address it in the way that it needs to be. Y
You can say that I’m jaded by the industry, but I don’t think so. Even news media have released stories recently indicating that insurers aren’t raking in the cash. Like CNBC – stating that for every $1 the U.S. spends on health care, less than 1 penny goes to health insurer profits. And recently Warren Buffett indicated that he wouldn’t consider investing in a health insurance company… it’s because the profits aren’t there.
So why do medical costs rise? According to Kaiser Health News, the increased use of medical services, hospital stays, new technologies and doctor visits are to blame. Does current legislation account for that?
Regardless, history is in the making, and I believe we should all get involved. Write your Congressperson and tell them what you think. If you need help finding them, you can contact them via Regence’s Issues and Action Center.
Interestingly, if the bill passes, history will write that this Congress passed a historic health care package, marking this a time in history to remember – and it’s likely no one will remember how it came to pass. The debate on the process will be forgotten. Similar to former President Clinton’s economic legislation – thought to be passed by a landslide – when actually it was Vice President Al Gore who was the one to cast the deciding vote.
It’s during these times in America’s history that we learn more about the legislative process than we ever cared to – which is why we don’t remember it later.
But for me, this time seems more important than others. Maybe it’s because more Americans than I care to think about are out of work. Or maybe it’s because I work for an insurance company. Honestly, I think for me it’s a combination of both.
Regardless, it’s got me thinking… and I’m sure it’s got you thinking too. About what the heart of the issue is. About why we care so much. And about what’s at stake. In these times, I believe it’s not just our health that’s at stake. It’s our economic well-being, and the kind of problems we could pass on to our kids, and their kids, and their kids, and so on.
The stakes are high this time – and maybe we won’t remember the process, but we’ll sure remember the result. So I hope this Congress gets it right. I hope they understand what is really driving health care costs up for all of us, and making health coverage so unaffordable… rising medical costs.
In my opinion, current legislation isn’t going to bring down rising medical costs, or address it in the way that it needs to be. Y
You can say that I’m jaded by the industry, but I don’t think so. Even news media have released stories recently indicating that insurers aren’t raking in the cash. Like CNBC – stating that for every $1 the U.S. spends on health care, less than 1 penny goes to health insurer profits. And recently Warren Buffett indicated that he wouldn’t consider investing in a health insurance company… it’s because the profits aren’t there.
So why do medical costs rise? According to Kaiser Health News, the increased use of medical services, hospital stays, new technologies and doctor visits are to blame. Does current legislation account for that?
Regardless, history is in the making, and I believe we should all get involved. Write your Congressperson and tell them what you think. If you need help finding them, you can contact them via Regence’s Issues and Action Center.
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