Practicing What I Preach

It was a Monday morning, a few weeks ago, and I was interviewing a new oncologist. Yes, interviewing because he was applying for a job, a really important job. My clients have heard me say this before. You are in charge of your health care. It is up to you to assemble a team of professionals and experts. They work for YOU. Do these doctors answer all of your questions? Do they answer the questions you don’t know enough to ask? Do you have confidence in them? If not, find another. It is only at this initial meeting that you are truly in control, because when you really need them, when you really need to rely on their expertise, you better be sure that you are prepared to cede to them an awful lot of control. I had an excellent meeting with the doctor and he has been welcomed to my team.

It has now been three years since my little health adventure and August will mark the three year anniversary of the end of my radiation therapy. Though I am not taking any medication or treatment I still incur tens of thousands of dollars of testing every year. Blood tests. CT Scans. Doctors’ visits. It costs a lot of money to prove I’m still here. My new oncologist had the pleasure of reviewing my latest semi-annual CT Scan. Each of these costs me $3,000. If I need this, I need it. My question was whether I still did. The answer, maybe not. We discussed this and decided that my next CT Scan could wait till May 2020, three months after I go onto Medicare. It doesn’t hurt to ask.

It was a few days later and it was time for my annual eye exam. The doctor saw something that got his attention. He called it a macular abnormality. He didn’t think that it was the beginnings of macular degeneration, but he wasn’t positive. He wanted me to see a specialist. So I asked, “Is this something that we’re going to monitor and I should check-in with a specialist after Medicare kicks in next February or should I stop at their offices on my way home?” The doctor said that it wasn’t an emergency but that it shouldn’t be put off till next year. Again, no unnecessary tests or procedures, but we don’t skip that what needs to be done. I contacted an ophthalmologist friend and was in his office the next Monday. The results – no problem. The first doctor did not overreact. He was right to express concern. The specialist, armed with the most up-to-date technology, was able to offer a more comprehensive diagnosis.

We talk about this often. Is every blood test necessary? Can the results be shared with everyone on the team? It is up to us to take charge.

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There is an advantage to being billed for your insurance, for knowing that your policy has been paid. Most health policies don’t charge extra for paper bills. I believe in online banking. I authorize my bank to pay my policy, usually the first week of the month for the payment due on the first of the next month. The payment comes out of my account around the 28th and I know that I am safe. I try to get all of my clients to do this. Sadly, not everyone listens. Two of my Medicare clients lost their Part D (Rx) policies because their auto-drafts failed. This happens. They will not be able to purchase prescription coverage again till this year’s Open Enrollment in October.

Even worse are the people who insist on having their Medicare Advantage premiums or their Medicare Part D (Rx) premiums come directly from their Social Security checks. Think about this. You are asking the government to write a check to the insurance company for an amount that changes every year. What could go wrong? Lots! According to Kaiser Health News, Social Security screwed up the coverage of over 250,000 people. It wasn’t until a few weeks ago that it was discovered that these people hadn’t paid any premiums this year. Over 43,000 Aetna clients were affected. Humana, over 33,000. Some of these people were cancelled and will hopefully be reinstated. All of them owe back premiums that will have to be repaid. This is a preventable problem. All it takes is a bill in the mail.

You are in charge of your health care. Whether we are talking about assembling your health care team, making sure that you only get the tests that you need, or just verifying that your monthly premium is paid, it is your responsibility to take care of you. What could be more important?

DAVE

www.cunixinsurance.com

Picture – LOW CARB Cherry Pie – David L Cunix

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What Happens If You Destroy Plan B?

There is a great freedom to taking a “risk-free” risk.  One example that comes to mind is the high school student that creates a business.  His parents are his main support.  Everyone wins if the new business takes off.  And if the business fails he simply gets another part-time job while attending school.  The student in this example always has a Plan B.  The only real risk would be if the student did something that endangered the family assets or the way the parents earned their incomes.  We all understand the value of having and protecting a Plan B, a backup plan.

A decision was made in 2010 to guarantee health insurance coverage, the way most Americans access and pay for health care, to people with preexisting conditions.  This was, for many Americans, the most important feature of the Patient Protection and Affordable Care Act (Obamacare).   The thinking wasn’t all that complicated – If you herd everyone into one large insurance pool, the sick and the healthy, we would spread the risk evenly making it possible to cover even the most unhealthy amongst us and at a reasonable premium.  Part two was that even if you are healthy today, there is no guarantee that you won’t be unhealthy tomorrow.  Pooling our risk made it more likely that insurance would be available when you eventually need it.

Did it work as planned?  NO!  The law may have been crafted with the best of intentions, but it fell short.  And, just as importantly, the PPACA had any number of opponents working against its success from day 1.

The law was dependent upon participation.  It was a given that the sick and injured would sign up for coverage.  I remember the initial Obamacare enrollment in the fall of 2013 for coverage beginning January 1, 2014.  I had families save over $1,000 per month with their new policies.  The new maternity benefits were very popular.  Young women and the unhealthy under age 65 all left my office smiling.  

Somebody has to pay.

Newton’s Third Law is that for every action there is an equal and opposite reaction.  If Doctor Herman’s (name changed) coverage decreased $1,200 per month, the healthiest amongst us are going to pay more.  There was a reason the insurance company was charging the higher premiums for those with preexisting conditions.  Worse, those higher premiums were often capped by law and didn’t begin to cover the claims incurred.  If the insurance pool is properly stocked with healthy people, we can withstand the claims of the unhealthy.  But, every time a healthy person leaves the insurance pool, the risk, the claims, are spread over a smaller group of premium payers.

I don’t believe that this is particularly hard to understand.  This concept of insurance is based on RISK, the possibility that you will need access to care.  We cannot build a system based on CERTAINTY, the knowledge that you will need care and that the cost of care is more than the cost of insurance.

The original law included the Individual Mandate, which penalized those who chose to not participate.  That has been eliminated.  There have been many attempts to weaken of sabotage the PPACA.  Last October the Trump administration published new guidance for Section 1332 waivers, the Obamacare provision that allowed states to improve the law.  Here is the link to the federal registry.  Reaction was swift and almost universally negative.

Most observers saw the new rules as a direct attack on people with preexisting conditions and the coverage that they so desperately needed.  The change allowed a state to note the existence of a Plan B (access to a policy compliant with the Patient Protection and Affordable Care Act) while actively promoting non-compliant policies that may not protect people with preexisting conditions.  It is no longer a “risk-free” risk if you destroy Plan B! 

Evaluations were quickly published by Deloitte, HealthTech Solutions, and Health Management Associates.  Within two months the Federation of American Hospitals, the American Academy of Family Physicians, and even AARP had weighed in and expressed concern.  These and others note the administration’s promotion of short term limited duration policies is designed to attract the healthier people from the comprehensive insurance market which will inevitably cause the prices to rise substantially.

The Democratically controlled House of Representatives passed H.R. 986 – Protecting Americans with Preexisting Conditions Act of 2019 last week.  This is the link to the text.  The goals of the legislation are:

  1. Prevent the destruction of the comprehensive insurance market (Plan B) by over-inflating the value and desirability of short term and other non-compliant policies.  
  2. To retain the value of the 1332 waivers in lowering prices by the creation of reinsurance pools and other innovations.  
  3. To enrage President Trump and draw a distinction between the political parties.

It is hard to guess whether or not this legislation will ever be addressed by the Senate, so goal 3 is the only certainty.  The White House issued a Statement of Administration Policy on May 7th, two days in advance of the final vote.  The final vote was primarily along party lines.  Republican Leader Kevin McCarthy published the amendments his members offered while the legislation was under debate.  My favorite was from George Holding (R-NC).  He proposed to change “the title of H.R. 986 to Insert Politically Punchy Title That Doesn’t Reflect The Bill Substance Act”.  That constructive effort garnered 184 votes on the House floor.  There isn’t any record on the Republican Cloakroom site of any productive amendments or any effort to improve the legislation.

I certainly hope that Mr. McCarthy and his buddy Mr. Holding never have to rely on Plan B.   Because if they have their way, it won’t be available when they need it.


DAVE

www.cunixinsurance.com

Picture – No Outlet – David L Cunix

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Cynicism Taken To Its Illogical Extreme

Befuddled In Iowa


Senator Charles Grassley (R-IA) was confused.  As this video shows, he was conducting a town hall meeting when one of his constituents noted that her life was dependent upon the Patient Protection and Affordable Care Act (Obamacare).  He couldn’t understand why she was worried.  Preexisting conditions are covered under Obamacare and Obamacare isn’t’ going anywhere.  It is the law of the land.  Sure the courts could rule it unconstitutional, but that probably won’t happen.  She asked him about his votes to repeal the law.  He didn’t understand the question.  That was ancient history, over a year ago.  This constituent actually thought that his votes to repeal Obamacare were serious.


We are currently living in the age of cynicism.   From the moment that the last Republican Senator abandoned the negotiations that created the PPACA and forced the eventual party-line vote, we have had a consistent political pitch to repeal the law.  Through the first eight years the Republican controlled House of Representatives could pass as many bills as they wished without any fear of the consequences.  And even when the Republicans took over the Senate they had the safety of an adult in the White House.  There wasn’t any risk to their votes.  They could keep the base riled up, keep the campaign funds rolling in, and never worry that anything was going to happen.  And even when the Republicans controlled the House, the Senate, and the White House, there was always someone (McCain?) to save them from themselves.


The problem is that not everyone was in on the scam.  A significant portion of the American public benefited from the law.  They took every assault on the law personally.  The Medicaid Expansion provided access to health care to the working poor.  Guaranteed issue with coverage for preexisting conditions eliminated the fears of millions of Americans.  Young women were now guaranteed maternity coverage.  And children could stay on their parents’ policies to age 26.  Would they lose their coverage?  Worse, many of the Congressmen who cynically initiated the fight were eventually replace by people who weren’t in on the joke (see Eric Cantor).   And state legislators in red states picked up the fight and took to the courts.


This blog has discussed the Texas lawsuit.   The big news is that the Trump administration, once oddly neutral in the fight to retain coverage for preexisting conditions, is now committed to declaring the law unconstitutional and recommending that the entire law be overturned.  This has resulted in a new round of panic amongst diabetics, heart patients, and those of us who have battled cancer.  During Congressional testimony Attorney General Barr brushed off concerns, mostly because he doesn’t give a damn.  Senator Grassley told his constituent that the lawsuit will probably fail.  And if it doesn’t? 


Senator Grassley, in a separate interview, noted that his constituents have nothing to worry about.  After all, he and a group of his fellow Senators just introduced the Protect Act, S 1125.  There are three tells, three ways to know that this isn’t serious legislation. 

  1. 1.       If you look at the Senators’ press releases and websites (Grassley, Portman, etc.), there isn’t a link to the legislation, just glowing terms of what it supposedly would do.  There are also no details about how it would protect preexisting conditions in these press releases.
  2.       The legislation is cosponsored by 18 Republican Senators.
  3. 3.     Like most legislation that is for show, the text of the legislation begins with the usual preamble detailing the ills of Obamacare.  You can always spot BS legislation when the author doesn’t even bother to use the official name, The Patient Protection and Affordable Care Act, in the actual text.

I would review the legislation, but I see no reason to take it more seriously than the Senators who stuck their names on it.


Having failed to repeal The Patient Protection and Affordable Care Act without a viable replacement, the full force of the federal government is now trying to get the law overturned in the courts.  This has left more than a few people concerned about their health insurance, the way most Americans access and pay for health care.  And it has left at least one Senator, that guy in Iowa, totally befuddled.


DAVE


www.cunixinsurance.com


Picture – Room 1200 – David L Cunix

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What If You, G-d Forbid, Use Your G-d Forbid Insurance?

 

The guy on the phone (a CPA!) wanted my opinion about a health insurance policy.  I’m not his agent and I wasn’t the first agent he called after buying this policy Friday from an out-of-state salesperson.  Steve (name changed) was looking for someone to congratulate him.  He had just beat the system!  Steve cut his family’s monthly premium in half to $700 and change.  So what if his new policy didn’t cover maternity?  He and his wife are long past that issue.  Steve insisted that I look over the benefits and quickly emailed the four pages.  Here are a few of the highlights:

All Benefits are Per Covered Person
Plan 4
In Hospital Indemnity – Pays a daily benefit for each day a Covered Person is Confined to a Hospital due to a Sickness or Accident. The first day of a Hospital stay must occur within 30 days of the Accident causing the injury.
$1,000/day
Max Days per Confinement
10
Max Benefit Amount per Plan Year
$30,000
ICU – Pays a daily benefit for each day of Confinement if an Accident or Sickness causes a Covered Person to be Confined to an Intensive Care Unit (ICU). The first day of Confinement in the Intensive Care Unit must occur within thirty (30) days of the Accident. This benefit is paid in addition to the In-Hospital Indemnity Benefit Amount.
N/A
Max Days per Confinement
Max Benefit Amount per Plan Year
ER Visit – Benefit pays if an Accident or Sickness causes the Covered Person to require and receive Emergency Medical Care in an emergency room of a Hospital. Treatment must be received within 24 hours of the Accident.
N/A
Max Visits per Plan Year
Physician Office Visit – Benefits pays for a Physician Office Visit as a result of an Accident or Sickness. The visit must be made to the Physician’s Office or Clinic. The visit to a Physician’s Office must occur within 30 days of the Accident causing the injury.
$75/day
Max Visits per Plan Year
6
Ground Ambulance
N/A
Max Trips per Plan Year
Air Ambulance
N/A
Max Trips per Plan Year
Surgical Indemnity -Pays a Surgical Indemnity Benefit if a Covered Person has a Major or Minor Surgical Procedure performed while In-Hospital or an Outpatient basis in an Outpatient Unit.
Inpatient Major
$1,000/procedure
           
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The Fifth Risk

One way to describe The Fifth Risk is “as the danger a society runs when it falls into the habit of responding to long-term risks with short term solutions.”*

I am sitting on a beach in Riviera Maya, a lovely area a half an hour or so south of Cancun, Mexico.  On CNN President Trump is threatening to close the southern border.   Here his name is seldom mentioned, even by his supporters.  My beach book is The Fifth Risk by Michael Lewis.  I read his last book, The Undoing Project, on the beach shortly after it was published.  The Undoing Project was about thinking and how decisions are made.  The Fifth Risk is, in large part, about the failure and consequences of not thinking.  The book is two hundred well-researched pages detailing the failures of the Trump administration’s transition team.

Mr. Lewis focused on two key areas of the government, the Department of Energy and the Department of Commerce.  Though it is clear that he could have chosen any of the cabinet level departments, he chose two of the more apolitical areas of our government.  And arguably two of the most important.

The Department of Energy gained notoriety in 2011 when presidential candidate Rick Perry, the Governor of Texas, tried and failed to remember its name.  He was attempting to list three cabinet level departments that could be eliminated.  Of course, he didn’t know that the D.O.E. is actually in charge of our nuclear arsenal, the security of all nuclear sites (past and present), and that the Chief Science Officer of the D.O.E is the de facto Chief Science Officer of our country.  Rick Perry is now the head of the Department of Energy!  He has yet to learn the full scope of the department he leads.  By the way, the D.O.E. has an annual budget of $30,000,000,000.

Here is where the Trump administration’s willful ignorance plays a role.  If your ambition is to maximize short-term gain without regard to the long-term cost.  If you want to preserve your personal immunity to the hard problems, it’s better never to really understand those problems.  There is an upside to ignorance, and a downside to knowledge.  Knowledge makes life messier.  It makes it a bit more difficult for the person who wishes to shrink the world to a worldview.*

White House Chief of Staff / Budget Director Mick Mulvaney made the rounds on last Sunday’s talk shows.  He brushed aside his attempt to defund the Special Olympics as simply an internal discussion.  He was on TV to defend the President Trump’s decision to join the lawsuit AGAINST the Patient Protection and Affordable Care Act (Obamacare).  He unequivocally declared that people with pre-existing conditions would not lose their health insurance.  He was mute about the other benefits of the law such as the expansion of Medicaid and the elimination of policy caps that were once as low as $50,000 on some policies.  Most importantly, Mick Mulvaney, Donald Trump, and the entire Republican Party have yet to provide a path forward.  If you eliminate the law, all of the protections and all of the funding ends right there.  The guy who doesn’t give a damn about disabled children is unlikely to worry about your access to insulin.  The short-term goal is to feed the base and eliminate the “Obama” of Obamacare.  The long-term problem is beyond their focus.

The woman at the next table is vociferously complaining about paying $500 per month to be on her employer’s group health policy.  She offers to trade plans with a Canadian couple.  They laugh and politely decline.

The Texas lawsuit is winding its way through the courts.  Will Chief Justice Roberts save the day, as he did in 2015, again?  More importantly, does anyone still believe that there will be a Republican plan, at the state of federal level, if the PPACA is declared unconstitutional?

A horrific tornado plowed through the city of Elk Grove the morning of May 16, 2017.  A man from the Federal Emergency Management Agency (FEMA) toured the area with Lonnie Risenhoover, the local emergency manager.

While driving the man around Elk City, Lonnie spotted Miss Finley.  Her house was a ruin and her barn was gone: surely she was eligible for relief.  Lonnie stopped so the FEMA guy might speak with her.  “You know,” said Miss Finley, “for the last ten years I prayed for a tornado to come and take that barn.  I didn’t think it would take the house, too.”  She seemed to think her reasoning self-evident.  The FEMA guy said that he didn’t understand: Why had she been praying for a tornado to take her barn? “Every time I pull out of the driveway I’m looking at that red barn,” she said. “And every time I pull into the driveway I’m looking at the red barn.”  At which point Lonnie asked the FEMA guy if he was ready to leave.  He wasn’t.  He was still puzzled: Why did it bother the woman to look at her red barn? “That barn,” said Miss Finley, “is where my husband committed suicide ten years ago.”

And so you might have good reason to pray for a tornado, whether it comes in the shape of swirling winds, or a politician.  You imagine the thing doing the damage that you would like to see done, and no more.  It’s what you fail to imagine that kills you.*

 

DAVE

www.cunixinsurance.com

Picture – The Fun Side Of The Border – David L Cunix

* Quotes are from The Fifth Risk by Michael Lewis.

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One Step Forward

 

My last blog post, Just Another Boring Week In Washington DC, reviewed my annual trip to Washington to discuss health insurance issues with our elected representatives and their staffs.  Health insurance agents have both a real understanding of how our private/public health care payment system works as well as the ability to express the positives and negatives in understandable language.  We are also in the position to champion our clients’ needs and concerns, issues that all too often are set aside or ignored.  One of those issues, one that has festered for several years, is how hospitals can classify a Medicare patient’s hospital stay as “for observation” which may impact subsequent coverage in a skilled nursing facility.  Under title XVIII if the Social Security Act:

The term “post-hospital extended care services” means extended care services furnished an individual after transfer from a hospital in which he was an inpatient for not less than 3 consecutive days before his discharge from the hospital in connection with such transfer.

 

Our group, the National Association of Health Underwriters, has been working to eliminate this problem.  I am pleased to announce that bi-partisan legislation has been introduced in both the House and the Senate.  H.R. 1682 is sponsored by Joe Courtney (R-CT).  The bill currently has 13 co-sponsors including Glenn Thompson (R-PA).  Senator Sherrod Brown (D-OH) introduced S-753 on March 12, 2019.  His 19 co-sponsors are a cross-section of the United States Senate and include Susan Collins (R-ME), Amy Klobuchar (D-MN), and James Lankford (R-OK).  Click here for a more detailed explanation of the legislation from Senator Brown’s website.


We have always presented this as a non-partisan issue, an issue of fairness.  It is gratifying to see Members of Congress from across the political spectrum step up to co-sponsor this legislation.   In the end, it is just one step forward.

DAVE


www.cunixinsurance.com


Picture – Observation Ain’t Enough – David L Cunix

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Just Another Boring Week In Washington DC

It was just another boring week in Washington DC.  Nothing going on.  True, the president’s former attorney and fixer, Michael Cohen, was staying at the same hotel as we were.  We happened upon the hearings while we were walking through the halls of Congress.   The president was in Vietnam to meet with the leader of North Korea.  Congress was debating a bill of disapproval over Trump’s emergency order.  And we were there, about 800 of us, to talk to our representatives about health insurance, the way most Americans access and pay for health care.  We may have been the least controversial people in the entire city.

I don’t wish to minimize our efforts or effectiveness, but we seemed to have been the Fords next to the Lamborghini display at the auto show. Some members of Congress and their staffs took extra time with us, savoring the half hour or so of normalcy.  Other offices were just so overwhelmed that we found ourselves meeting in stairwells and hallways.  No matter what, our elected representatives and their staffs were professional, prepared, and serious.  They are aware that they have been entrusted with a great deal of responsibility.  My annual trips to Washington restore my faith in our system of government.

These trips tend to be broken into two parts. The first involves speakers, usually thought leaders, members of Congress and the administration, promoting their vision for improving the health care system.  The rest of the week is spent on Capitol Hill meeting with our elected officials.  Somewhere in between all of this I try to squeeze in conversations with agents and company reps from around the country and a cigar at Shelley’s Back Room, a cigar lounge frequented by foreign diplomats, lobbyists, and politicians.

One has to admit that the current administration has tested my faith. We were pleased to have Alex M. Azar II, the Secretary of Health and Human Services (HHS), speak to our group on Wednesday.  This is a big deal.  We had already heard from John O’Brien who specializes in drug pricing for the administration and Brian Blase, a special assistant to the president for economic policy.  The Secretary, as the others before him, felt compelled to highlight the economy and the jobs’ numbers.  And of course, we were told that President Trump cared deeply about protecting coverage for preexisting conditions.  We were all too polite to note that this administration chose not to defend this provision in the Texas lawsuit.  We were also told that President Trump was concerned about Surprise Billing, a real issue for many of our clients.  The message was familiar.  It was the way it was delivered, the constant name-checking of their boss, that made it so odd.  At one point I closed my eyes and substituted “Dear Leader” in each sentence for Trump.  It worked surprisingly well.

It has been eight years since the passage of the Patient Protection and Affordable Care Act (Obamacare).  Some Democrats want to scrap the legislation and move to some form of single payer coverage.  More, possibly most, Dems would like to change and improve the law.  And the Republicans?  It depends.  After eight years of empty promises and weak options (Do you remember the American Health Care Act?) bomb throwers like Jim Jordon (R-OH) now have comments like this on their government websites: “First and foremost, we need to get health care reform done right, not done fast. Passing another thousand-page bill without amendments or debate will do nothing to help the economy, create jobs, or reform health care.” That may be translated to “Other topics are more fun.  I’ve moved on”.  But Senator Lamar Alexander and other Republicans are working, mostly around the edges, to improve the PPACA.  Our time was best spent with those representatives concerned about stabilizing the markets and making the system work.

I met with Tina Chhabra, a former pharmacist, in Senator Sherrod Brown’s (D-OH) office. I also talked with Catherine Wilson who works for Congressman David Joyce (R-OH) and Joe Herrbach from Congresswoman Marcia Fudge’s (D-OH) staff.  Congressman Joyce was in a hearing.  This is the first time he was unable to meet with us.

Much like last year and the year before last, our focus was on stabilizing the market. In a world dominated by sound bites and tweets, someone has to remind our elected officials of the real world implications of their legislation.  Here are a few of the areas we discussed with our members of Congress:

  • COBRA as Medicare Credible Coverage – This is one of those down in the weeds issues that had no champions, only victims.  COBRA doesn’t count as credible coverage.  Senior who retain their COBRA coverage instead of enrolling in Medicare when they become eligible, are considered to be “late enrollees”, subject to a waiting period, and will pay a penalty for the rest of their lives!  It is normally just a mistake.  Retirees over 65 may not have access to good, free information.  We can correct this.  H.R. 5104 died in committee last year. We hope to see it reintroduced soon.  This is the link to the previous bill – Medicare Enrollment Protection Act.
  • Transitional Relief – It seems to fall upon us to remind our friends in Washington about the importance of Transitional Relief / Grandmothered health policies.  These policies were written and issued in 2010 after the PPACA was passed until the end of 2013 when the law was fully implemented.  Many of us are dependent on our ability to retain these policies and wait nervously for the annual announcement.  There aren’t any policies sold in Ohio that can match the network access of the Anthem, Medical Mutual, and Golden Rule Grandmothered contracts.  Every Congressman and legislative aide quickly grasped the importance of granting transitional relief for these policies.  Some even thought that this should be simply granted permanent status.  As with so many other issues, this would disappear without our constant vigilance.
  • Retain the employer tax exclusion – More than 178 million Americans get their health insurance at work.  There were some proposals being floated to either cap the maximum amount of premium the employer could deduct or eliminate the deduction completely.  Talk about destabilizing the market!  There seemed to be little interest in overturning our markets in the offices I visited.

We had more time in some offices than others. Some of our representatives are more interested in how consumers could use the Tax Credit Subsidy outside of the Marketplace if there were fewer than two choices available in a particular county.  Others are more focused on delaying or repealing the so-called Cadillac Tax.  I would be happy to have a more in depth discussion of the issues over coffee (or cigars!) at your leisure.  It isn’t nearly as boring as it might seem.

DAVE

www.cunixinsurance.com

Picture – A Quiet Spot – David L Cunix

 

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Health Care Down Under

“Here’s an example of the mindset we have here that is second to none: It’s called the TAC – the Transport Accident Commission. Put simply, each of us pays a very small tax each pay check on a sliding scale that the TAC puts into a pool. If you get into a car/motorbike accident and if it is not your fault, the TAC pays every single cent of your costs. I know, I experienced it. I was in a motorbike accident 10 years ago. At the time I was unaware of the TAC’s benefits and honestly, as I lay on the ground in pain with cops around me yelling at cars to slow down, I actually worried that I would be bankrupted by the accident even though it wasn’t my fault and even though I had private insurance but not much of a policy at the time. Lo and behold, I filed my claim and the TAC could not have been more efficient and compassionate. Paid everything right down to my aspirin.” 

Insurance is a promise, an intangible, a hated monthly expense until the moment it is needed. And if/when the insurance fulfills its promise, there is nothing else that matches its level of value.  The above quote is from my friend Wendy who I have known since high school.  Wendy grew up in Ohio, but has lived in Australia for decades.  I recently asked her about their health insurance system.  She provided some personal info, some links, and the TAC story.

Your personal experiences will determine your impression of our system, just as Wendy’s impacts hers. Our ongoing debate about health insurance in the USA, our way to access and pay for health care, is a 50/50 mix of fact and emotion.  We are often told that America is the only western country without universal health coverage.  The speakers too often present universal care as being the same throughout the world.  It is not.  Each country has tinkered with the concept, utilized or prohibited private coverage, and struggled with the challenges of expensive medications and therapies.  The Australian Medicare system appears to be closer to our hodgepodge of coverages than it is to Canada’s.  That doesn’t make it better or worse, just different.  And if you are sick or injured and the insurance fulfills its promise, it is perfect.

The Australian Medicare system is funded by a 2% levy (tax) on taxable income. This provides access to the public system.  The public system covers the cost of visits to a general practitioner during normal business hours most of the cost of a semi-private room at a public hospital.  Your choice of physician, operating rooms and out-patient prescriptions are not included in the Medicare system. The patient is often expected to pay the cost of care and is then reimbursed by Medicare.  Australians also have access to a variety of private health insurance programs.

Just to be clear, bureaucratic writing is universally dense.  The following is from the official Australian Medicare site:

  Need for private coverage:

  • If you have an appropriate level of private patient hospital cover, you won’t have to pay the MLS, and depending on your income, you may be eligible for the private health insurance rebate. This rebate is an amount the government contributes towards the cost of your private hospital insurance premiums.

 

You may be entitled to an exemption from MLS for part or full year. This will be determined from the information that you provide in your tax return.

Depending on your circumstances, the Medicare levy, the MLS or variations to your private health insurance rebate may impact the refund you receive or the tax you owe.

If the MLS has resulted in you owing tax, you can take steps to avoid a liability in the future by:

  • reviewing your rebate

 

varying your PAYG withholding

For those who are interested, I am happy to include relevant links to the official site for further research.

 

The Australian public system offers access.  Their private system offers choice.  It is a two tier system that would be easier to implement in the United States than many of the other ideas currently being tossed about in Congress and on TV.  As with any system, Australia’s Medicare has its champions and detractors.  President Trump has been quoted as being a fan.  A more detailed and thoughtful analysis can be found in this 2016 Guardian article from Doctor Ranjana Srivastava, a doctor who works in the public system.

Back to Wendy:

“We also carry private insurance to cover things not provided by Medicare but also because we don’t always want to depend on the public system. For instance, my GP just referred me to a surgeon in the public hospital system. Since it is not urgent I will likely wait 2-3 months for an appointment but it will be fully covered. I could chose to go private based on my policy and get faster service and I have done that in the past. It just depends on what I need.

If you don’t have private health insurance you get a tax penalty anyway. I think I pay about $1400 annually for health insurance. I think that’s fantastic.”

Different countries, different systems. It is important to remember that there are almost as many ways to access and pay for health care as there are countries.  As we begin a new, and hopefully serious, discussion on how to improve ours, let’s take the time to learn about other systems so that we can avoid their problems and build upon their successes.

DAVE

www.cunixinsurance.com

Picture – Australia – David L Cunix

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The Tenth Blogiversary of Health Insurance Issues With Dave

Point of Personal Privilege – This post, the 266th, marks the tenth anniversary of Health Insurance Issues With Dave.  I could not have achieved this milestone without you, the readers.  My one year anniversary post thanked Brad Kleinman and David Toth, the two guys who taught a class on eMarketing and social networking at a Chamber of Commerce meeting in January 2009.  This blog has had a lot of other helpers along the way.  I would be remiss if I didn’t take this opportunity to thank a few of my best proofreaders/supporters, the people who push me to improve this blog – Susie Sharp, Ellen Jacob, and Annie Cohen.  There are the long-suffering team of Jeff Bogart and Lianesha Mays who are often exposed to working drafts of these posts.  It takes a lot to start any major project.  I can still remember my daughter, Jennifer Kuznicki, pushing me back to writing in the fall of 2008.  And I need to thank my number 1 cheerleader, the first to read all of these posts, and the only person who actually laughs at all of my jokes – Sally Mandel.  Health Insurance Issues With Dave appears on the original BlogSpot page, my website, on LinkedIn, and the AOL Patch system.  It has readers throughout the country.  My proudest moments are when I hear about attorneys, CPA’s, and other insurance agents providing this blog to their clients as a way to illuminate the issues.  I hope to continue to earn your time and attention.  Reminder – the links in this blog are normally footnotes, a chance to connect you to more information.  The rest of the links are just me having fun!

Though it might appear that much has changed over the last ten years, the key questions remain unanswered – What are our priorities and are we willing to pay for them?  What we know is that Americans really don’t care who pays for our health care whether it is the government, the insurance companies, or our next door neighbor as long as it isn’t us.  We want access to any doctor, any hospital, and we don’t want anyone asking WHY or IF the procedure is necessary or warranted.  “Deductibles? Copays?  Isn’t it enough that I have to pay the premium?”  The first post discussed a terminally ill man, covered by Medicare, who was on the list to get a new kidney.   Did that make sense?   Are we, as a society, willing to even have this discussion?

There is going to be a lot of talk during the upcoming presidential campaigns about different ways to fund health care. Do we retain our current system, with or without tweaks, or do we choose to move to some form of universal / single payer health care?  Lots of numbers, big numbers, will be tossed around like monopoly money.  $32 trillion here.  $50 trillion there.  Please remember that our current system of health insurance is simply a process to compensate medical providers, an organized process to pay for and access care.  Before your eyes glaze over, stop and ask a couple of questions:

  • What, specifically, will be covered?
  • What is the funding mechanism?
  • How will costs be controlled?
  • How will the system increase revenues when the initial cost estimates prove to be too optimistic?
  • What place will employers, currently major participants in our system, play in any future system?
  • Will participation of either the consumer or the provider be mandatory?
  • Do the insurers have a place in this?

My last post included a lot of information about Medicare.  It may seem odd, in 2019, to point out that words have meanings, but the blog was to serve as a reminder that the word, Medicare, actually means something.  Thus saying that you want everyone to have Medicare doesn’t mean that you want everyone to have free insurance that covers 100% of all health care.  That’s not Medicare.  We can’t have a useful conversation unless we speak clearly and honestly about the issues involved.

These four thoughts appear above the title of each blog post:

  • PURPOSE Short Articles designed to illuminate different aspects of the health care discussion.
  • CORE PREMISE If you think you know all the answers, you probably don’t understand all of the questions.
  • CENTRAL BELIEF Absolute Power Corrupts Absolutely
  • AUDIENCE Our current health care system impacts all Americans.

Thank you for ten great years.

DAVE

www.cunixinsurance.com

Picture – Have A Cigar – David L Cunix

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We Need Water

Ten days in the desert. Dry. Dirty. Thirsty. Very, very thirsty. And there, on a make-shift table, is a pitcher containing a liquid. Some people would simply drink the liquid, no questions asked. Some people might first try to make sure that the liquid was OK, perhaps not great but better than nothing. And some of us would hold out for a clear assurance that the contents of the pitcher was perfectly safe. There is a liquid in the pitcher. What we need is water.

UnitedHealth Care lost again. The recent decision from the California Supreme Court reaffirms the finding from the California Insurance Commissioner that UHC had failed its customers and should pay fines totaling $91.000.000. When Americans complain about our current health care system in general, and the insurance companies in particular, it is instances like this that trigger these feelings. There are times when our system must feel like a desert and any liquid would do.

The 2020 election season has opened with health care as a main focus. Several candidates have been quoted as supporting Bernie Sanders’ Medicare for All plan. Though it is early and Senator Kamala Harris might eventually offer a refined, personal version that differs from Senator Cory Booker’s plan, the basics may be the same. Our Senator, Sherrod Brown, co-sponsored the Medicare at 55 Act in 2017 and is still a big proponent of the concept. Since there may be as many as 30 Democrats running, we are likely to see a number of variations on this theme.

The one thing Democrats, whether there are 20, 25, or even 30 candidates, won’t do – run on the status quo. The Democrats have defended the Patient Protection and Affordable Care Act (Obamacare), basically a Republican plan, for ten years. Their base was always focused on something more grandiose, universal coverage. Even my parody of their planning, a post I wrote in October 2009, reflected the results of a Medicare for All type program not Obamacare. The Dems will expand the conversation in 2020. Some of the programs may not be realistic or achievable, but they will have goals beyond a mere fix for Obamacare.

First, Medicare is not a generic term. The word actually means something. There are four distinct Medicare Parts:

  • Part A – Principally inpatient hospital charges and skilled nursing facilities
  • Part B – Doctors and surgeons, in or out of the hospital, testing, durable medical equipment
  • Part C – Medicare Advantage policies
  • Part D – Outpatient prescription

Click here for a more complete description of Medicare coverages. Medicare is not free and it is not 100% coverage.

  • Part A – There is no charge if you have paid Medicare taxes over a 40 quarter period. The standard Part A premium is $437 per month if you paid less than 30 quarters and $240 if you paid Medicare taxes for 30-39 quarters.
  • Part B – The premium for most Americans is $135.50 per month.

 

The 2019 Medicare Part A deductible is $1,364. Part B is $185. Medicare is designed to pay approximately 75% of someone’s medical bills. Medicare beneficiaries have the opportunity to purchase Medicare Supplement policies, Medicare Part D (Rx) coverage, or Medicare Advantage policies to improve the affordability of health care.

Some plans build on the current Medicare foundation. Some just like the sound of the word “Medicare”.

Senate Bill 1742, Senator Brown’s Medicare at 55 Act, was incredibly straightforward. There is no attempt to change the basic structure of Medicare. There are even provisions for the purchase of Medigap (the federal term for Medicare Supplement policies), Part D and Medicare Advantage policies. We don’t know how much someone would need to pay to access Medicare Part A and Part B, the premiums for a Medicare Supplement and a Part D (Rx), and if after all of that it would be any better than a regular individual policy. It would depend, in part, on where you lived and the cost of care in your area.

Jacob Hacker is the Director of the Institution for Social and Policy Studies at Yale University. His program is Medicare for America. Professor Hacker builds on the Medicare model to create a plan that is both ambitious and aware of the costs associated with its implementation. The plan assumes both premiums as well as out-of-pocket expenses for care. This plan may be harder to sell but easier to enact. I think that we will see some versions of Medicare for America on the campaign trail this summer.

Senator Bernie Sanders has stated, “Health care must be recognized as a right, not a privilege for every man, woman and child in our country regardless of their income. The only long-term solution to America’s health care crisis is a single-payer national health care program”. According to his Medicare for All website, “As a patient, all you need to do is go to the doctor and show your insurance card. Bernie’s plan means no more copays, no more deductibles and no more fighting with insurance companies when they fail to pay for charges.” That is not Medicare. No deductible. No copays. No networks. No cost for utilization. And, no chance for success.

Senator Sanders and his team estimate that his plan will only cost @11 percent of GDP. Most other estimates are significantly higher. The Senator envisions an increase of the federal tax rate to as high as 52% on some Americans as well as changing the way capital gains and dividends are taxed as a way to defray the cost of his plan. While some focus on the funding mechanism, others are looking at the impact on hospitals and other medical providers. The Sanders plan may pay as much as 40% less than private insurers. Proponents point to the reduced paperwork and processing charges as if new forms and procedures won’t replace the ones we already know.

Bernie Sanders may have been a mirage in 2016, but Senators Harris, Booker, Brown, and a cast of others are running to be the real thing, the president of the United States. It is time for them to give us some water.

DAVE

www.cunixinsurance.com

Picture – Perfectly Safe – David L Cunix

Bonus – Water

 

 

 

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