Member of the reality-based community of progressive Massachusetts blogs
Not as bad as the corporate-welfare-recipient HMOs wanted, but still, a 12.1% increase in premiums? A 45% increase in copays? Does anyone else see the problem with wages which barely keep up with inflation (if they do) and state government mandated private HMO premiums that far exceed it?
Is it any wonder that most industrialized nations who have universal health care cut out the greedy middle man (the HMOs) and save a lot of money per person for it? And how can we still be ignoring the need for cost controls in our reform? What are we really getting for our taxpayer funds, and what more are we getting for such drastic increases? I don’t see it. I just see deteriorating quality, worse coverage, bad behavior (denial of coverage), and increased costs.
If this bodes what is to come, can you imagine someone who is barely affording paying $200 per month in premiums paying an approximately $25/month increase ($300 more per year) every year (plus bigger copays)?
Hey Niki Tsongas, what say you to Massachusetts health care reform, now? You were so gung ho on it in the election.
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March 20th, 2008 at 9:13 pm
Lynne,
I really thought about this. (thanks) The nominal amount extra I would have to pay (yes it would be more for me) for all the uninsured to have insurance is just a no brainer. It is good for individuals, and I spoke with my boss (110-125 employees) and he thinks it would be fantastic. He said those companies that already offer a good health insurance would save money by cutting out the HMO’s profits. So the only one that would get hurt with universal single payer would be the greedy hmo’s and the companies that should be contributing. I have no idea how anyone making even $5 over minimum wage gets by and pays rent, and health insurance regardless of premium.
March 21st, 2008 at 8:02 am
Note that State is being asked to assume risk of cost overruns, yet there is no mention of rebates should the costs underrun. In any case, the budget is already broken.
By Alice Dembner
Globe Staff / March 21, 2008
The state’s new subsidized health insurance program will cost “significantly” more than the $869 million Governor Deval Patrick proposed in his 2009 budget just two months ago, the state’s top financial official said yesterday, after insurers were granted an increase of about 10 percent.
To close the gap, the Patrick administration has asked insurers, hospitals, healthcare advocates, and business leaders to propose ways to cut costs and raise revenue. During two closed-door meetings in the last two weeks, several dozen proposals have been put forward, including raising assessments on insurers, hospitals, and businesses. The goals are to solve the short-term funding problem for next year and ensure the long-term survival of the state’s near-universal health insurance initiative.
Leslie Kirwan, secretary of administration and finance, declined yesterday to discuss specifics of the proposals or the size of the budget gap, but said that without changes, the state doesn’t expect “to be able to live within” the proposed budget.
A state panel yesterday approved a contract to pay insurers about 10 percent more for each person enrolled in the subsidized insurance program, starting July 1. The insurers had asked for about a 15 percent increase, but agreed to take less after weeks of negotiations. Still, the state’s cost is higher than was included in the governor’s budget. Under the contract, the state also would assume more of the financial risk if the enrollees were to use more medical care than expected.
March 21st, 2008 at 9:53 am
I heard it said that: “National Health Insurance means combining the efficiency of the Postal Service with the compassion of the I.R.S. and the cost accounting of the Pentagon.”
Did you expect any less from a state-level program? The problem with your criticism is that your solution is probably going to be to raise taxes rather than premiums like it would make a difference. Both ideas stink.
And again, you repeat the assertion that wages aren’t keeping up with inflation when it is clearly misleading because it leaves out non-wage benefits. Reality-based my behind…
March 21st, 2008 at 12:32 pm
Josh: you have it so backwards. It’s the BUSINESSES that are killing the state’s plan, not the state.
Direct insurance from the government would cost far less per person. It does in other countries. Do the math. If the middle man (the HMOs) didn’t have to take their cut, it would cost less. AND we do need cost controls. That’s the unfortunate fact. The state plan left all of those elements out, which is why it’s costing so much. Cut out the HMOs and then it’s more affordable.
Let’s see how the greedy HMOs compete with government-run plans. They don’t WANT to, because they know they can’t. Hence, this silly state plan that merely hands out taxpayer cash like gangbusters to the middle men HMOs.
Non wage benefits? Like the 12-40% increase in cost in premiums for most private insurance through our employers? Give me a break. They are NOT more valuable, just more costly. So, yes, reality based, my friend. How can you possibly say that they are more valuable year to year, when they also cost significantly more as well?
March 21st, 2008 at 12:33 pm
The problem with the state program is that private health insurers are still involved. As long as the HMO’s are still putting the astronimical profits in their wallets we will have problems with this system.
March 21st, 2008 at 3:27 pm
You remind me of the Dane Cook skit where his friend wants to go out and “pick up some chicks” to which he replies: “Oh yea? Just like that?”
“C’mon man, let’s cut out the middleman.”
“Oh yea? Just like that?”
Obviously if a middleman is in existance then they are playing some sort of economizing role that is necessary in the current situation. You won’t be cutting out the middleman, you’ll simple be replacing it with a less accountable, more bureaucratic state agency that loathes dynamism and competition. If it’s so easy, why doesn’t a greedy capitalist like myself start up an HMO, undercut all my greedy competitors, steal their customers, and make a tidy profit? I can’t because it would be economically unfeasible to do it… the same goes for any government-run plan.
Also, the wages+benefits are indeed more valuable. Would you want last years medical care? How about from 5 years ago? 10 years ago? We’re not paying more for the same care. We’re paying more for better care.
Now I’m not saying that healthcare today isn’t broken, but more government is only going to make it worse.
March 21st, 2008 at 3:43 pm
http://www.youtube.com/watch?v=Ae0_TAz4NFw
March 21st, 2008 at 5:13 pm
Non wage benefits? I get such a kick out of this. So because my boss paid $50 more per week for my insurance I got a raise? Sorry Josh but that does not put milk in the fridge ($3.99 gallon) or gas in the tank ($3.11 per gallon). If they quantified in your studies the break out of benefits such as profit sharing, matching 401K vs increased health premiums maybe I could agree that we are atleast better of long term.
March 21st, 2008 at 7:53 pm
“I can’t because it would be economically unfeasible to do it… the same goes for any government-run plan.”
I’m not sure, but I think Medicare management is contracted out, but using a set of rules that are standardized. Medicare appears to be well-run, notwithstanding the funding problem that will make the Trust Fund go broke in a few years. That is a combination of too little income, and too heavy a percentage of high-cost recipients. It will cost to balance its books, and then cost some more to extend it to the remainder of the population, but that is a tractable problem, and wouldn’t require a new system to be developed.
March 21st, 2008 at 8:07 pm
I am not sure single payer–our friends overseas cited as fine examples of this solution. While life expectancy seems to be higher in some other places than in the US, there are also complaints about complicated or expensive services not being readily available. Medical tourism is beginning to appear.
I would suggest that what we need is organizational reform. A couple of folks I work with have introduced the idea of “crew resource management” as a way to save lives (and save money). This is about avoiding accidents by getting the medical teams to work in a more interactive way–this has saved a lot of lives in aviation. A chap down in Maryland is calling for use of checklists by medical folks to cut down on hospital infections and accidents. And, I would like to see a profusion of Physicians Assistants and Nurse Practioners, spread throughout neighborhoods, to download the Emergency Rooms (and reducing time delays there) and allowing primary care physicians to focus on the more complicated or baffling issues. All of these, if proliferated across the fruited plain, would save money and make for better health care, and without the above mentioned old chestnut of the worst combination of the Postal Service, the IRS and the Pentagon.
Regards — Cliff
March 21st, 2008 at 10:20 pm
One of my former managers would always go with the indemnity plan at work which allowed her the use of any doctor, in plan or out of plan. And using an out-of-plan doctor only provided a partial reimbursement. But she paid for the best level of healthcare. It was significantly more than what I paid for using an HMO option. I think that her husband had health issues and that she wanted the best care she could get. She retired at a young age as she earned a lot and her husband’s business did very well.
I think that getting rid of the middle man would be very difficult as Clinton found out back in the 1990s. The middle man fights back. And perhaps they do provide an economic advantage. Or at least some of them. The economic argument sounds right. If someone can do a better job, then they should go in there and do it. But it has the problem of strong competitors already in place. Perhaps an apt analogy is in our education system. As it involves a lot of money, limited choice, and Federal, state and local control.
March 22nd, 2008 at 8:20 am
HMOs did not exist before the early 1970s. The whole idea that Healthcare is a Business and not a Human Right is actually a VERY new idea in the United States. The principles you would use to make a business successful, ie cutting costs, making a profit at all costs, making the profit exclusive to a select few, are antithetical to good healthcare.
Whether or not you’re a fan of Michael Moore, rent “Sicko.” He has a point.
We are the wealthiest country in the world. We should all be covered with some type of basic healthcare, just for showing up. And it should be covered by our tax dollars. Yes, including dental and eyeglasses. Yes including poor people, sick people, people of color, single mothers, etc. The ideology that Healthcare is a privilege will cause all of us to get sick from eachother, and unnecessary overcrowding in the emergency room.
March 22nd, 2008 at 9:09 am
Getting rid of the middleman is INTENSELY difficult but it will be necessary sooner or later. Probably later, when the system’s even more broken than it is and people are suffering even more. But to say it’s impossible - well, no. Eventually something’s gotta give, and populism will triumph over corporate profits by necessity. How do you think all the other basic government programs got started? Medicare, because NO corporation wanted to cover the most expensive and unhealthy among us and it reached crisis point. SS, because seniors were reaching retirement after a lifetime of working class salaries and had nothing to live of off. WIC because children were starving and dying in one of the richest countries on earth.
It will happen. It’s just a matter of pain.
Niki: that’s exactly it. There is an inherent conflict of interest between making money and giving care. The very things that a corporation needs to do in order to make ever bigger profits to please the shareholders make for poor health care.
Cliff: You’re pretty funny. I mean, you say, “life expectancy seems to be higher in some other places” (by the way, in all other western democracies, it is, by a lot, we’re LAST, in all the major measures of health), but then say “there are also complaints about complicated or expensive services not being readily available” (which is not as true as Republicans would have you think, actually). Um, I think I’ll take a few complaints over waiting periods for non life threatening procedures for universally available care. The alternative is rationing by COST instead, which affects the poor and the old. In other words, we in this country are rationing care out now, just not in a fair or even fashion.
For every anecdote you have about waiting lines or service in other nations, I can give you ones from people I KNOW personally who say they would never trade their system, flaws and all, for ours. About life saving quick ER service that saved a friend of mine’s life, despite the fact that she was, basically, part of the working poor and wouldn’t have been able to afford the premiums of this country out of her paycheck.
March 22nd, 2008 at 11:28 am
> For every anecdote you have about waiting lines
> or service in other nations, I can give you ones
> from people I KNOW personally who say they would
> never trade their system, flaws and all, for ours.
Well I’ve heard that too. From those wealthy enough to be in a
private system.
I don’t know about the dental and eyeglasses. There’s a lot of personal
responsibility for dental that makes a big difference and there are
procedures that are very expensive. Same with eyeglasses. I have coverage
but still pay a good chunk of the cost of frames. I have three frames that
I bought many, many years ago and just keep reusing them with newer lenses.
March 22nd, 2008 at 12:51 pm
Lynne, you have absolutely no understanding of economics whatsoever. People make profit by delivering shoddy healthcare? Are you serious? Profit is a result of delivering the goods and services that people demand. You’ve never explained why healthcare is any different.
“It is no crime to be ignorant of economics, which is, after all, a specialized discipline and one that most people consider to be a ‘dismal science.’ But it is totally irresponsible to have a loud and vociferous opinion on economic subjects while remaining in this state of ignorance.”
~Murray Rothbard
March 22nd, 2008 at 2:13 pm
Josh, your understanding seems to stop at the standard economic model. Healthcare in this country hardly runs on that model. Look at the incentives. They are out of whack in our system. There is actually a perverse incentive to avoid better care.
This is all a side effect of the fact that insurers are allowed to dictate who can buy their product.
More Ezra:
Apparently Lynne understands more than you think.
March 22nd, 2008 at 2:31 pm
Josh,
Companies make profit by not delivering health care at all. If possible, they limit care covered to take in more than they give out–a simple economic principle.
“If all economists were laid end to end, they would never reach a conclusion.” George Bernard Shaw
The problem with considering economics as a “discipline” or as a “science”, is that to do so you must rely on assumptions that are oftentimes false. Whereas, within a certain system of logic, certain arguments of yours may be proved true, given a set of realistic or simply different premises, they can be proved false. The reason why you have a spectrum of economists, and correspondingly, varied opinions, is because economics is really a collection of philosophies.
“To believe that there are no higher levels of reasoning than economic theory is to be ignorant of the realities of the human condition.” –me
March 22nd, 2008 at 2:49 pm
All I can say is that my and everyone else’s practical experience with private health care is exceptionally increasing costs for increasingly shoddy service, denial of care, and such. Do you, as a diehard libertarian, at least admit that so long as a corporation can get away with it, they will produce dangerous/shoddy/absent products and services, if they do the math and the cost of cleaning up or getting sued is less than the savings of cutting corners (or in the case of health care, denying 1/3 of claims outright hoping a number of people don’t appeal)? If you can not admit that, then you don’t understand the “free market” either.
March 22nd, 2008 at 3:02 pm
“People make profit by delivering shoddy healthcare?”
The issue is not healthcare, but insurance. Medicare, for example, is effectively a public insurance which pays private healthcare providers.
Medicare has a funding problem, however, that must be addressed. Its income is from a regressive tax system that taxes only workers and their employers at a total fixed rate of 3.3% of earned income. There are better ways to fund that. Its expenses are high, primarily because it pays the bills for a class that has the highest health care expenses. What it doesn’t do is a) make a profit, b) pay exhorbitant salaries and bonuses, c) provide healthcare services, nor d) invent rules to decline payments to achieve profit.
Medicare for all would have lower per capita expenses, and not be focused entirely on the elderly.
However, we would have to find an alternate funding mechanism, one that was progressive with ability to pay, but did not penalize work nor companies that employed US workers who are paying personal income taxes.
March 22nd, 2008 at 5:48 pm
Having been batted about and outed as a Republican, I am back. ERs are available to everyone here as well. That is why they are crowded and need to be downloaded by furnishing other providers. This is not about some system of paying but about some system of making providers available. Economics helps here, but time for education and training also has to be included. Until we up the number of providers, we have a fundamental problem. The good news is that a lot of providers from overseas come here. Are they economic migrants? Perhaps. One of them is my primary care physician. Another was my surgeon when I had a lumpectomy–false alarm, fortuantely.
Thanks
Regards — Cliff
March 22nd, 2008 at 10:00 pm
Cliff, CVS has proposed something that may offload emergency rooms. That may be something along the lines of what you proposed earlier. The only issue I have with that is the potential conflict-of-interest with their drug store operation, and the quality of the personnel staffing the site.
March 22nd, 2008 at 11:18 pm
In addition…limited access to quality health care, because of the uninsured and underinsured, this also crowds our ERs. We could actually alleviate emergencies by covering everyone and making sure people can get to a Dr when their health problems are easier to deal with, rather than uninsured people waiting until it’s an emergency, when things cost more and the care is more intensive.
Trust me, as someone who went without health insurance for 6 years, I never saw a doctor. We got lucky - our health issues waited until we got on insurance, but we came close to needing the ER to solve our problems because we had not gone to a doctor for those intervening years…if we had gone on any longer uninsured, we would have been in that situation.
March 23rd, 2008 at 10:00 am
We have a lot of clinics in my area which work out well. The problem is that they are usually only open during extended business hours and that we have to use emergency rooms when they are closed. Staffing clinics at night and on weekends or providing on-call services would seem more efficient to me. Unless the volume was so low that it didn’t make it practical.
I worked in a hospital (mainly medical surgical) for four years and the on-call stuff was pretty routine back then. For some reason, they don’t do this at our clinics.
March 23rd, 2008 at 10:11 pm
Josh,
“Blue Cross has dominated local health care for almost 70 years, since originally being chartered as a charitable nonprofit organization to promote the public health. Now controlling about 80 percent of the privately insured market, Blue Cross constitutes by far the largest source of payments to hospital providers.”
What effect do you think an oligopoly has on health care pricing? The free market has not been allowed to do its thing. Even John McCain is for opening up the health care markets to out of state. You can not pretend that the healthcare market is not in a crisis. You can see in the increase in Specialist copay increases, decreases in vision care and prescriptions etc.. that the insurers are out for the maximum profit by making certain physicians extremely elastic.
March 26th, 2008 at 7:02 pm
I had a look at the charts of United Healthcare, Aetna, Cigna, Wellpoint, Human and Coventry. Aetna. In the last year, Aetna has remained about the same. The others have taken a beating.
I had two pairs of glasses made recently. Insurance covered one pair completely. I supplied an old frame that I purchased many years ago. On the second, I wanted a special coating that cost about $80 so I paid for that out of pocket. Everything else was covered. I again provided my own frame. Everyone that can is jacking up prices as there’s a lot of inflation in the air.