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Insurers’ Latest Dodge to Not Cover You when You Need It: The Incredible Shrinking Network

December 1st, 2013 1 comment

Today’s must-read Seattle Times article by Carol M. Ostrom and Amy Snow Landa (interactive graphic here and comparison table here) prompts me to write about a huge problem with American health insurance that I’ve been banging against quite personally in recent months.

Excerpts below give an idea what an important article this is. My thoughts:

Insurers are actively eliminating must-have hospitals from their networks, while imposing unlimited out-of-pocket charges for out-of-network services. If the provider you need (a pediatric or major-trauma hospital for instance) isn’t in your insurer’s network, you could face financial ruin even though you’re insured.

I’ve been deep in the individual health-insurance shopping game recently, shopping for myself in Washington State and for my 22-year-old daughter in Illinois. I even built a web app to compare total costs of different health plans, because there’s really no way to compare them without such a tool.

It’s incredibly complex, with all sorts of interacting variables to evaluate. I can’t imagine how someone without my analytical skills (and time to use them) could even begin to do a good job of it — protect themselves effectively and suss out the best deals to do so. Most would have to throw up their hands and throw a dart.

To be a smart shopper in this market, you have to be very smart, and have lots of time on your hands.

That pretty much describes me — the Republicans’ dream shopper, out there driving down insurance prices by comparing and carefully evaluating all the competition and choosing the best deal.

But even I have been completely flummoxed by one big issue: how do I evaluate the networks of providers offered under different insurers and plans? Sure, I can look to see if my doctor’s covered. Great. Big deal. But what if I have a major auto accident? Is Harborview (Seattle’s top-flight regional trauma center) covered? How about Children’s Hospital, our pediatric mecca? (Not an issue for me these days, but…) The Swedish Hospital system? (Top-rated for ER intake times, the place I would go for a medium emergency.) Seattle Cancer Care Alliance? (This is the outfit you’re gonna want if you face that horror.)

One and only one insurer in Seattle covers all those providers in-network. Most cover none of them.

Ostrom and Landa have done the legwork for us here in Seattle. If you’re elsewhere…sure: you can evaluate this — by going to every single insurer’s site, figuring out which of their often-multiple networks a particular plan supports, then successively searching those networks for all the possible providers using their little web tool, one provider after another, one insurer after another, and building yourself a table.

It’s basically like playing Battleship.

Realistic? Even if you could predict, in advance, what providers you might need someday (and you’re savvy enough to know which providers in town are important), we’re talking hours of work to check whether each plan covers them.

Here are the crux paras from Ostrom and Landa’s article:

The Seattle Times asked the seven insurance companies selling individual policies in the exchange in King, Pierce and Snohomish counties to list their in-network hospitals.

The results show that only one — Community Health Plan of Washington — includes Seattle Cancer Care Alliance, which offers treatment for some of the most complex cancer cases in the region.

Four of the seven insurers do not include the University of Washington Medical Center or the UW’s Harborview Medical Center — which has the state’s only Level 1 trauma center and burn unit.

Community Health includes every major hospital in King, Pierce and Snohomish counties, but is the only exchange insurer that does.

By contrast, Premera and its subsidiary, LifeWise Health Plan of Washington, include many major hospitals, but not the largest Seattle-area hospitals in the two major medical systems — Swedish and UW Medicine.

Let’s be very clear here: Premera and  Lifewise, two of the state’s biggest insurers, provide in-network coverage for none of the important hospitals I listed above. Not Children’s (pediatric). Not Harborview (major trauma).

Meanwhile many, most, or all of their plans have no limit on your out-of-pocket costs for out-of-network providers. If you have a serious illness or injury, you could be financially ruined even though you’ve got insurance.

This part really, really pisses me off:

Coordinated Care CEO Dr. Jay Fathi said the company would use “single-case agreements,” which he likened to an invoice or a bill. The hospital sends the bill to the insurer, who pays it, a system he said functions “fairly smoothly.”

Children’s officials say such agreements are quite rare and are generally limited to patients who are out of network because they live outside the local area. Resorting to single-case agreements, they said, would likely delay care for patients.

In other words, “Trust us. We’ll cover you if you need it.” (Yeah, and I’ve got a bridge for sale.)

This also points out that exposure to out-of-network charges, traditionally much more of a problem in rural counties, has now come home to urban dwellers. Seattle has traditionally been seen as a really great place to get sick — great providers with ample access.

That’s no longer true if you’re buying individual health insurance.

Cross-posted at Angry Bear.

Health Insurance Plan Comparison Calculator. Plus…Hamlet!

November 18th, 2013 No comments

Gentle Readers:

Sorry to be incommunicado for so long. I’ve been working hard on a couple of projects.

I built a spreadsheet for myself a few years ago to compare health-insurance plans — cost versus financial exposure/protection. I just built it out into a web app that others can use, and I’ve posted it here.

You enter premiums (after deducting any subsidy), deductibles, co-pays etc. for up to four plans, and it estimates your total outlays in different health/spending scenarios:

Screen shot 2013-11-12 at 7.37.09 AM

It’s especially good for ruling out relatively bad deals. For instance, why would anyone buy the purple plan here for an extra thousand dollars a year, instead of the green plan, which offers the same or better financial protection?

There are simply too many variable in health plans to compare them in your head. I’m hoping this app will be as useful to others as it’s been to me.

Farther afield, the second edition of my Hamlet book was just published, along with a fully hyperlinked ebook edition that I’m rather proud of. (Turns out it was a lot of work to create a really good ebook.) If you’re even one tenth as interested in this play as I am, you might find the book interesting and entertaining. Further insights into the true depths of this obsession at princehamlet.com.

HamletEbookCover400x615

Cross-posted at Angry Bear.

 

What if the Doctor Market Was Like the Lawyer Market?

June 20th, 2012 6 comments

Andrew Oh-Willeke points us to this, on the job market for lawyers:

Slightly more than half of the class of 2011 — 55 percent — found full-time, long-term jobs that require bar passage nine months after they graduated, according to employment figures released on June 18 by the American Bar Association.

I couldn’t find a comparable figure for medical graduates on a quick search, but I’m guessing the number’s in the low single digits.

The lawyer glut has been going on for a while, and at least in Canada (the only place I’ve found data) it’s been having predictable effects on legal fees — down 40% in nine years ’01–’10:

I doubt that doctors’ fees are the prime driver behind our crisis of rising health-care costs (what providers charge). But at least one analysis says it’s an important part (Todd Hixon, Forbes):

U.S. spending annual on physicians per capita is about five times higher than peer countries: $1,600 versus $310 in a sample of peer countries, a difference of $1,290 per capita or $390 billion nationally, 37% of the health care spending gap. These conclusions come from an analysis co-authored by Miriam Laugesen of the Columbia University School of Public Health and Sherry Gleid, an Assistant Secretary in the U.S. Department of Health and Human Services (source)**.

This suggests that relieving the supply shortage – especially for primary care doctors — could have a big impact. Not a new insight, but I thought this data point would be of interest.

Update: In response to WH10′s good comments, perhaps some better thinking:

Maybe the answer’s to relieve the shortage of specialists, driving down their compensation and making primary care (relatively) a more attractive career option.

Cross-posted at Angry Bear.

 

Business Roundtable Proposes Obamacare to Restore American Competitiveness

March 6th, 2012 No comments

Or: You Just Can’t Make This Shit Up

“Health Care Costs Put U.S. at Significant Disadvantage Compared with Global Competitors”

I’ll let you read the details, but short story:

costs

competition

Whodathunkit?

And what do they recommend?

Creating greater consumer value in the health care marketplace by using health information technology and empowering consumers with more information about good quality health care.

Providing more affordable health insurance options for all Americans by creating an open, all-inclusive private market for health insurance and replacing today’s fragmented state-by-state market with multistate markets. To ensure that insurance plans are solvent and meet certain minimum requirements, the role of individual states as the primary regulator should continue. Broader, more competitive markets will create more choices for more health care consumers.

Engaging all Americans in taking an active role in their health care. First, this means placing an obligation on all Americans to obtain health insurance either through their employer or the private market. Second, we must encourage all Americans to participate in employer- or community-based prevention, wellness and chronic care programs.

Offering health coverage and assistance to low-income, uninsured Americans that create a stable and secure public safety net. This assistance would be financed from the cost savings and efficiencies generated by a more competitive and value-driven health care system.

The Business Roundtable Health Care Value Index – Executive Summary | Business Roundtable.

Cross-posted at Angry Bear.

Arnold Kling: Non-Acute Health Care Is a “Status Good”

October 17th, 2011 3 comments

He really said that. I guess people take their kids to annual checkups because they want to signal their high status to others.

This is totally in keeping with Jonathan Haidt’s findings: on measures that “have anything to do with compassion,” libertarians are at the very bottom of the political spectrum.

Likewise Tyler Cowen’s paean to autism, whose defining characteristic is an inability to empathize with other humans.

You’ll constantly hear libertarians claiming that their ideas and policies would be “good for the poor,” but given their measured failure of empathy and compassion, you have to wonder whether those claims might merely constitute false status signaling in a species for which empathy and compassion are hard-coded values.

I really should stop donating page views to the Koch Brothers-funded GMU/Mercatus cabal (and you’ll notice I don’t provide a link here; you can Google it if you wish). But it’s like watching a very well-choreographed train wreck: it’s hard to look away.

Update: I find that some obvious googles don’t turn up Kling’s post, so here’s a link with a “nofollow” tag so the post doesn’t get any Google juice from it.

Death and Money: American Exceptionalism

July 15th, 2011 No comments

Lane Kenworthy once again gives us one of those graphs that encapsulates a whole global scenario, over four decades:

Yeah: we’re #1.

Edit: just to note that while we were on the high end of the spending pack until about 1980, we were within the normal range. It’s only since then that things really went off the tracks.

America’s inefficient health-care system: another look « Consider the Evidence.

Did I Mention Mentioning that It’s the Health Care Costs, Stupid?

June 12th, 2011 No comments

Government Gets the Lead Out, Crime Plummets

May 29th, 2011 3 comments

No, this is not about lead-footed Starsky and Hutch-style car chases by law enforcement.

Rather, it’s about damned convincing evidence that unleaded gasoline (introduced in the U.S. in the 70s) is largely responsible for the huge decline in crime rates since the early 90s. (Update: it continues.) Even more convincing than (but not precluding) Levitt’s Roe v Wade hypothesis.

Short story: we spent fifty years quite literally poisoning the minds of our children — especially inner-city and low-income children. The damage is permanent.

Researcher Rick Nevin is getting some well-deserved press (Washington Post, Wall Street Journal) for his cross-country analyses of lead exposure and crime. (Worth noting: he first published this research in 1999.)

Here’s a picture; you can eyeball the correlations yourself. The researchers, naturally, analyze the correlations more systematically.

Here’s more, consumption of lead in gasoline in the USA, in thousands of metric tons (click for source):

See also the work of Jessica Wolpaw Reyes, who claims that half the decline in crime resulted from less lead in the environment (hence in little kids’ heads).

Robert Waldmann (hat tip!) at Angry Bear is looking at the latest data from the UK, where they went unleaded thirteen years later, so the effects should be showing up now. They seem to be:

the total number of violent crimes was basically identical in 2004/5 2005/6 and 2006/7 then declined about 17% by 2009/10. The predicted peak of 2007 corresponds about as precisely to the data as is conceivable.

From the WaPo article:

Chicago’s Robert Taylor Homes, for example, were built over the Dan Ryan Expressway, with 150,000 cars going by each day. Eighteen years after the project opened in 1962, one study found that its residents were 22 times more likely to be murderers than people living elsewhere in Chicago.

Nevin’s finding implies a double tragedy for America’s inner cities: Thousands of children in these neighborhoods were poisoned by lead in the first three quarters of the last century. Large numbers of them then became the targets, in the last quarter, of Giuliani-style law enforcement policies.

We’re seeing it in spades: the history of tetraethyl lead (read it and weep) is a tragic textbook case of market/profit interests eviscerating the commons and making us all (including the rich) far worse off, in the name of “the invisible hand” making us all better off.

That ebil gubmint man with his heavy-handed regulations impinging on honest businesspeople (who are just trying to make a buck, for everyone’s benefit) sure did have a pernicious effect, huh?

Why We Have Such a Wacko Health Insurance System

May 20th, 2011 No comments

Conservatives love to point out that our employer-based health insurance system is a result of wage controls under FDR. Since employers weren’t able to attract workers with higher wages, they started offering benefits instead — notably health insurance.

I recently read Frank Freidel’s biography of FDR, and the whole story became clear.

The post-Pearl Harbor economic surge was causing rapid inflation.

By March, 1942, food cost almost 5 percent, and clothing 7.7 percent, more than on the day of Pearl Harbor; the cost of living had risen 15 percent since September 1939. [Leon] Henderson predicted prices might rise 23 percent more by the end of 1942. The nation, as Roosevelt well realized, was reaching  the critical point where, as a result of price increases, demands for wage increases could force spiraling inflation.

Roosevelt was desperate to prevent that eventuality.

Heavier taxes to drain excess buying power were imperative. [This is not complicated; see Abba Lerner on "Functional Finance."]

Conservatives in Congress (then as now) were rabidly anti-tax — gotta protect the monied class — but despite their supposed free-market ideology, they were willing to impose wage controls. (Big surprise.) Roosevelt was able to get this second- or third-best solution through Congress.

So the wage controls that resulted in our ridiculous employer-based health-insurance system were a direct result of conservatives’ hypocrisy.

And now, notwithstanding Ryan’s obviously-never-gonna-happen voucher feint, conservatives have demonstrated themselves to be dead-set on maintaining the status quo of employer-based private health insurance (they had six years of unfettered control, did nothing about it…) — the very “historical accident” that they so bemoan, and that they are responsible for inflicting on the nation.

 

Barack Obama, Constitutional Conservative?

April 25th, 2011 1 comment

I’ve been just as frustrated as other progressives with the Obama administration’s lack of … progressivity. And I’ve been befuddled by why it hasn’t happened. Why didn’t he take the lead on redesigning our health-insurance system, for instance, instead taking the politically bruising months-long course of delegating its drafting to Congress?

Here’s a possiblity.

Obama — constitutional law professor that he is — is at his very core a constitutional conservative. He believes that laws should be created by Congress, not the executive branch. And unlike so-called conservatives on the right, he’s ready to live by those convictions, sacrificing both short term policy goals and political considerations on the altar of those beliefs.

I think it’s quite possible that when the biographies are written, when the historians get a chance to go through the presidential papers and interview key members of the administration, that constitutional conservatism will emerge as at least one of Obama’s defining characteristics as president.

But I’m not sure. What do you think?