Just Politics?

Otto von Bismarck is credited with “Politics is the art of the possible, the attainable — the art of the next best”.  The goal is not to posture and make noise.  The goal is to govern and get things done.  As in any art, there are greats, near greats, and others.  The US government is a huge stage.  The greats shine.  The near greats and others are exposed.

I spent a good part of today slogging through the 393 pages of H.R. 6800, the HEROES Act.  The US House of Representatives passed this bill on May 15, 2020.  There is a talent to drafting legislation, to knowing your goals and working through the various previously passed laws to get to your desired results.  The bill, like all Congressional bills, has any number of items which any of us could disagree.  Legislation produced by either the House or Senate are starting points.  The final legislation is produced in the conference committees that work out the final details.  The House got their work done on May 15th, over two and a half months ago.  The Senate couldn’t generate its bill by its own deadline of last Thursday.  There is way too much disagreement within the Republican ranks and President Trump and his team seem to have different goals.  A Republican compromise was released this week.  It was DOA.   Senator Lindsey Graham (R-S.C.) is prepared to immediately jettison one the White House’s priorities, a billion dollar plus new FBI building and has guessed that over 50% of the Republican Senators would vote against their own opening gambit.  There is no Senate bill.  The basis of all future negotiations will be the HEROES ACT.  So let’s take a look.

H.R. 6800 impacts almost all Americans.  Since this in Health Insurance Issues With Dave, we should take a look at a few of the provisions specifically relevant to health insurance.

  • Provide significant funds to the Center of Medicare and Medicaid Services for Program Management dealing with coronavirus on the state level
  • Create a Special Enrollment Period for individuals over and under age 65
  • Allow the government to pay for COBRA for those impacted by COVID 19
  • Modify and expand the Paycheck Protection Program
  • Increase the flexibility and carry-over provision of the Flexible Spending Accounts (FSA)
  • Relax the employer filing requirements of certain employer/insurance forms
  • Eliminate cost-sharing for COVID 19 treatment
  • Provide funding and establish requirements for COVID-19 testing and contact tracing
  • Require employers to develop and implement infectious disease exposure control plans

Details?  It is probably best to look at this as just part of a starting point.  Negotiations will begin in earnest in the next day or so.  Millions of Americans are dependent on state based unemployment insurance and the extra money provided by the federal government.  That is currently $600 and set to end this week.  The Heroes ACT extends the $600.  The current Senate offer is $200.  Again, this extra money ends in a few days.  That may be the main focus of this week’s talks.  The rest, such as FSA flexibility and COBRA funding, will fall into place.  This blog will report the results as available.

But if you are unemployed, if you are trying to determine how to pay for your COBRA health insurance, this isn’t politics and the art of the possible.  This is money and the key to survival.

DAVE

www.cunixinsurance.com

Picture – Grand Masters – David L Cunix

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Picking Your Battles

Senator Claire McCaskill (D-MO) knew that she was going to have a tough reelection race.  It was 2012 and Missouri had taken a turn to the right.  Mitt Romney was going to beat President Obama.  The key would be to choose her opponent.  Knowing his weaknesses, Senator McCaskill chose Representative Todd Akin and helped his campaign.  It has been eight years and many of you still recognize his name and his statements about “legitimate rape”.   McCaskill picked her battles and won the war.

This blog has detailed the Obama administration’s decision to include birth control pills, IUD’s, and the Morning After Pill as part of the Preventive Care Benefit of the Patient Protection and Affordable Care Act (Obamacare).  The first of close to a dozen posts about this issue was More Free Stuff which was posted on July 24, 2011, almost nine years ago.  To be clear, I was not then nor am I now personally opposed to these forms of birth control.  This is not about my personally held beliefs.  Nor do the inclusion of or opposition to these birth control methods have much to do with medicine, insurance, or health care.   This is a battle over control and religion.  Kathleen Sebelius, then the Secretary of Health and Human Services (HHS), picked this battle.  And she won the war, until this week when the war was lost.

The Supreme Court decided in a 7 – 2 vote this week that businesses could limit or exclude coverage for birth control under religious or moral grounds.  The case, Little Sisters of the Poor Saints of Peter and Paul vs. Pennsylvania, was nine years in the making.  Chief Justice Roberts has expressed his frustration in having the birth control issue making its way to his court again.  He couldn’t understand why the two sides couldn’t find a way to accommodate each other’s beliefs and needs.  I am personally shocked that the Chief Justice would actually expect either side to want to accommodate the other, much less make an honest effort at accommodation.

The Obama administration proposed a compromise in February 2012.  The impacted employers wouldn’t have to pay for birth control.  The employers could opt out and the insurance companies would front the cost.  As noted in my post of February 13, 2012:

Senator Roy Blount (R-MO) quickly released a statement via email.  It stated, in part:

“It’s clear that President Obama does not understand that it isn’t about cost – it’s about who controls the religious views of faith-based institutions.  President Obama believes that he should have that control.  Our Constitution states otherwise.

Just because you can come up with an accounting gimmick and pretend like religious institutions do not have to pay for the mandate, does not mean that you’ve satisfied the fundamental constitutional freedoms all Americans are guaranteed.”

A year later in the post The Great Imposition, February 11, 2013, we learned that there were people who weren’t just offended that their businesses might be providing birth control to their employees.  We then discovered that the inclusion of birth control in individual policies meant that other people will be able to make their own decisions.  There appeared to be a large number of Americans who felt compelled to impose their religion/morality/choices on others.  You may not have realized that you were accepting someone’s definition of religion when you were accepting a job in their machine shop or dental office.  Now they were upset that they couldn’t extend their reach to complete strangers.

According to the Jesuit Review, in a survey of American Catholics including many who go to Church regularly, “just 8 percent said contraception is morally wrong, with 89 percent saying it was either morally acceptable or not a moral issue at all.”  This, again, is a reminder that this entire issue is about control and religion.

As we have previously discussed, our health insurance policies covered birth control pills even when they didn’t.  Under the old rules, teenage girls would complain about difficult menstrual issues and the family doctor would prescribe birth control pills to help regulate their cycles.  Two problems solved!  The pills weren’t free, but the parents who could afford the cost didn’t mind.  Those who could not afford the cost of the monthly prescription were sent to Planned Parenthood (yes, that Planned Parenthood) for a reduced cost or even free.  This was a workaround, neither efficient nor 100% honest.  The PPACA ended all of that.  Birth control was now available to everyone, not just to those who could afford it.  Universal access was not universally appreciated.

We learned in 2010 that corporations are people.  People may not be people.  Certainly people aren’t always treated as people.  But corporations are not only people, but it turns out, as I noted in a post from July 3, 2014, these entities can even have sincere convictions.  The Supreme Court (Burwell vs. Hobby Lobby), days earlier in a 5-4 decision, continued the trend of dehumanizing individuals while we anthropomorphize corporations.

This week’s Supreme Court decision was in response to a Trump administration action taken in October 2017.  At the time this action seemed as much about Trump scoring A Small Victory as it did about birth control.   The key was that it opened up the possibility of eliminating the benefit under either religious or moral grounds.  In my opinion the most important issue was that since the Obama administration had the power to define these forms of birth control as part of Preventive Care, the Trump administration could just as easily change the definition.  Two of the more liberal justices, Elena Kagan and Stephen Breyer, agreed that that each administration had the right to create exemptions.

So what does it mean? When it comes to the Supreme Court, I always turn to Amy Howe a reporter at ScotusBlog.  Here is her summation:

“As both Alito’s and Kagan’s opinions suggest, the battle over the exemptions from the birth-control mandate may not be over yet. Instead, the dispute will go back to the lower courts for them to weigh in on whether the expansion of the exemptions was the product of reasoned decision-making, virtually guaranteeing that the litigation surrounding the exemptions will continue until well after the 2020 election. And depending on the results of the election in November, a change in administration could lead to efforts to narrow or eliminate the exemptions. But at the very least, today’s decision cleared the way for employers to claim the exemptions going forward.”

We can’t always pick the battles we wish to fight, nor is there ever a guarantee of victory.  Former Senator McCaskill easily won in 2012, but she lost by 6% in 2018.  The battle over the access and payment of birth control will continue.  Each side will celebrate some victories and each side will suffer some defeats.  It is a battle both sides want.

DAVE

www.cunixinsurance.com

Picture – Armed With A Pen, Hardly Dangerous – David L Cunix

 

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Construction vs. Destruction

Ronald Reagan famously said that the most terrifying words in the English language are, “I’m from the government and I’m here to help”.  The line garnered laughs and applause whenever he delivered it.  We’ll never know who wrote the quip or whether he really believed it.  But he had been an actor and he delivered the line with style and it was well received.  People in the southeast, an area ravaged almost annually by hurricanes from the Atlantic or the Gulf of Mexico, failed to see the irony.  The people living in the tornado alley states of Oklahoma, Kansas, Iowa, and others also cheered the line.  And so it became apparent that federal help (money) is good help as long as it is for you and wasted if it is for someone else.

Some of us are looking for a bigger picture, a way to describe the value of federal help, money, and regulation that can potentially help large segments of the American public.   The expansion of Medicaid, a federal-state partnership to provide health insurance to the poor and working poor, is one of those programs.  The Medicaid expansion was a key component of the Patient Protection and Affordable Care Act (Obamacare).

I had the great pleasure of hearing freshman Congresswoman Lauren Underwood (D-IL) speak while I was in Washington a few months ago.  Prior to her election she had been a nurse.  She drafted H.R. 4996, Helping Medicaid Offer Maternity Services (MOMS) Act of 2019.  Her legislation was designed to expand Medicaid services a full year postpartum.  The logic was clear.  “The majority of pregnancy-related deaths happen after the day of delivery, and nearly one quarter of deaths happen more than six weeks postpartum.”  It took a nurse to bring this to Congress’s attention.  I was so impressed with her presentation that I went to her office and got more information from her legislative aide.  Who benefits from this expansion of Medicaid?  Obviously the families of the women who have just given birth.  These are families in urban, suburban, and, importantly, in rural areas.  This also helps to make sure that medical providers, doctors and hospitals, are compensated in these settings.  Rural hospitals suffer from uncompensated care.  This is a solution.

H.R. 1425 – The Patient Protection and Affordable Care Enhancement Act includes Congresswoman Underwood’s Medicaid expansion.

The House of Representatives passed H.R. 1425 earlier this week.  The goal is to make the PPACA more effective.  Like the bill it is tweaking, this enhancement is neither perfect nor likely to garner a lot of support from the Republicans in the Senate.  The point is to put forth constructive, useful rules to make it easier for Americans to access and pay for health care.

My blog post from eight years ago today scoffed at the intellectual dishonesty of repeal and replace and asked instead for revise.  H.R. 1425 is a good starting point for an honest debate about revising the PPACA.  Sadly, you can only have a serious policy debate if you have participants from both political parties and the attention of the president.

H.R. 1425 has its detractors.  Some are just the usual suspects who appear to believe that they were elected to Congress simply to disagree with whatever the other side does.  We won’t waste time on them.  Nor will we mention some of our Congressional delegation more intent to have their pictures taken than to ever do anything.  There is a good chance that these Congressmen have not bothered to read the bill.  They have legislative aides for that.

The American Action Forum “is a center-right policy institute providing actionable research and analysis to solve America’s most pressing challenges.”  Christopher Holt, the Director of Health Care Policy, published an executive summary of H.R. 1425 on June 25, 2020.  This is the link.  It is only 7 pages and worth the read.  Spoiler Alert – he is not a fan.

Mr. Holt’s analysis is instructive.  You may like what he dislikes.  Or, your thoughts find a home in his words.  What is clear is his honesty about how his perspective impacts his view of the law.

Here are some of the key goals and provisions of the Enhancement:

  • Reduce premiums by bringing healthy people into the insurance pool. This is done by limiting and/or eliminating short term policies
  • Expand the Tax Credit Subsidy to make insurance more affordable
  • Fix the “Family Glitch”, the problem when the employee has coverage from work, but the coverage for dependents is too expensive. This was determined to be a huge issue since 2014.
  • Provide funding for reinsurance on the state level. The states that have done this have shown real savings on insurance premiums.  We keep hoping Ohio would do this.  The funding would help.
  • Incentivize the states that haven’t expanded Medicaid to finally do this. This might be what it takes to get states like Kansas and Missouri across the finish line.
  • Money for outreach and advertising for the annual open enrollment
  • The Medicaid postpartum expansion
  • The government would be allowed to negotiate with the pharmaceutical companies over pricing. This was H.R. 3 passed earlier in the term.

Those are some of the highlights.  Mr. Holt has his thoughts.  For a different perspective, you might also want to look at Katie Keith’s article in Health Affairs.  She is a touch more positive.  But whether you are in one camp or the other, an honest reading of H.R. 1425 is to see the beginning of a conversation, a path forward.  It is construction not destruction.  After 10 wasted years where little has been accomplished, wouldn’t it be great if the people we elected to help make our lives better focused on that job?  Health insurance, the way most Americans access and pay for care, is an issue for all of us.  I’d love to hear our Congressmen tell us that they are from the government and that they are here to help and mean it.

DAVE

www.cunixinsurance.com

Picture – Clearing A Path – David L Cunix

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It Was All A Game

The Washington Post, CNN, and other news organizations published long, in-depth articles about the 2017 Republican tax bill.  The most cynical man in Washington, Mitch McConnell, needed to find extra money for his tax cut.  And, of course, neither Mitch nor President Trump ever passed up a chance to attack the Patient Protection and Affordable Care Act (Obamacare).  Eliminating the penalty for those people who failed to purchase insurance, the Individual Mandate, could free up as much as $300 billion.  (By the way, this is the very definition of cynicism.  Without the mandate, young and healthy people would skip insurance, prices would skyrocket, fewer people would purchase coverage, and the government would eventually save money since fewer people would get the tax credit subsidy help to pay their premiums!)  If you read the articles or anything else from that time, you will not find any mention of the tax bill making the PPACA unconstitutional.  Senators like Susan Collins (R-ME) and Lamar Alexander (R-TN) were still in discussions with their Democratic counterparts to strengthen other provisions of the law.

Senator McConnell was very aware of the dangerous game he was playing.  When asked in June of 2018 about the potential damage of the Texas lawsuit and the Trump administration’s position, Mr. McConnell said, “Everybody I know in the Senate, everybody is in favor of maintaining coverage for preexisting conditions…There is no difference in opinion whatsoever”.   But Mitch had years and years of actions that directly contradicted his words.  There were dozens of votes to repeal Obamacare.  There was the fictitiously named Better Care Reconciliation Act of 2017.  And that brings us to today.

The Trump administration filed its brief last night for the Supreme Court’s review of the Texas lawsuit.  Trump’s attorneys argue that the entire Patient Protection and Affordable Care Act should be eliminated.  ALL OF IT.  The administration’s position is clear.  Guaranteed coverage for preexisting conditions? Ditch it.  Preventive Care? Nope. Coverage for children to age 26? NO!  The law is irredeemable.  And they say it is all Mitch’s fault.

From Page 13 of the brief:

Nothing the 2017 Congress did demonstrates it would have intended the rest of the ACA to continue to operate in the absence of these three integral provisions. The entire ACA thus must fall with the individual mandate…

Our Republican friends have voted countless times to repeal Obamacare.  The Trump administration just called their bluff.  And yes, it is a bluff.  Always was.  There is no replacement waiting in the wings.  We are talking about nearly 20% of our economy.  We are talking about the way most Americans access and pay for health care.  And by the way, we are in the middle of a pandemic.

The Supreme Court will hear this case in October and won’t render a decision until after the election.  How convenient.  This may be all a game for some of our elected representatives in Washington. But it is not a game that anyone with preexisting conditions wants to play.

DAVE

www.cunixinsurance.com

Picture – Right Game, Wrong Venue – David L Cunix

 

 

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Paper Mache Armor

Our Governor, Mike DeWine, is on TV with Dr. Amy Acton, the Director of Health, almost every day.  The Ohio House and Senate are in session and working.  Having our government working for us could be a good thing.  There certainly is no shortage of issues for them to address.

One of those issues is Surprise Billing.  On May 20th the Ohio House unanimously passed H.B. 388, the legislation specifically designed to address out-of-network care. The legislation was introduced in the Ohio Senate on May 26th.  It should get passed and be signed by the governor next week.  The Bill is only 14 pages and if you promise to take a quick look I won’t feel compelled to review all of it here.

The vast majority of H.B. 388 is devoted to the way out-of-network charges are defined and, more importantly, how the providers (doctors, facilities, ground ambulances, and clinical laboratories) will be paid.  There is a definition of the Benchmark or the fair market value for payment.  There is extensive verbiage related to negotiation and, if necessary, baseball style arbitration.  And as was reported in the newspapers, the consumer cannot be billed for the difference between his/her insurance plan’s reimbursement and the providers’ charges.

It looks great, but it is only paper mache armor.

H.B. 388 has the same gaping loophole as some of the other bills introduced in the Ohio legislature.  If you care to read along, turn to Page 6, Line 143 of the bill.  Let me summarize:

  • For services covered by the health plan, but are provided by an individual out-of-network provider, an individual cannot be balance billed unless all of the following are met:
  1. The provider informs the individual that the provider is not in the covered person’s health benefit plan.
  2. They provide the consumer with a good faith estimate, including a disclaimer that they are not required to get the services at that location for from the provider.
  3. The covered person consents to the services.

There was no budge on this provision.  A requirement that the disclosure be made 24 or 48 hours prior to the procedure would have been useful.  A requirement that the fees be clearly stated with an explanation of how or why the final price could change with a limit to that change would have been useful.  A prohibition of sticking a form in front of a patient mere minutes before a procedure and “asking” for consent, would have been useful.  My guess is that we will be revisiting this in a year or so once the abuses add up to a point where this has to be taken seriously.  I am sure that the hedge funds that own some of the biggest offenders, the ones whose actions created the need for this whole discussion, will have their consent forms printed before Governor DeWine can affix his signature to the final bill.

Or not.  Those are my concerns.

But our representatives, our senators, and our governor are working to protect us.  I just wish they would take the time to make our armor of stronger stuff.

DAVE

www.cunixinsurance.com

Picture – Ready To Make My Shield – David L Cunix

 

 

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Sounding The Alarm

The focus of this blog, Health Insurance Issues With Dave, is, first and foremost, insurance, the way most Americans access and pay for health care.  There are three key players in this process: the medical providers, the insurance companies, and the government.  The medical provider section includes doctors, hospitals, pharmaceutical companies and everyone/everything else involved in the delivery of care.  The insurance companies serve both to organize the market and as a useful buffer between the providers and the patients.  And the government writes the rules, pays a huge portion of the bills through Medicare and Medicaid, and significantly impacts the pricing.  There is a natural push and pull in this process.  The American public benefits when all three sectors work towards a common good (Enlightened Self-Interest).  That isn’t easy and it depends on a determined focus and an honest effort.  To be clear, determined focus and honest efforts don’t guarantee success.  A lack of either determined focus or honest effort guarantee failure.

Deep In The Heart(less) Of Texas was posted on September 9, 2018.  This was the first blog dedicated to the Texas lawsuit, the attempt to have the courts declare the Patient Protection and Affordable Care Act (Obamacare) unconstitutional.  Today’s post will be the 14th warning of the havoc this could cause.  Yes, I keep sounding the alarm.  There isn’t any good will, focus, or honest effort involved in the promotion of this lawsuit.  And it only got worse when Donald Trump decided to champion its cause.

The sudden elimination of Obamacare without a replacement would terminate health insurance for millions of Americans.  This is so important that I was happy to see an article in Sunday’s (5/24/2020) Plain Dealer on the issue.  “If Obamacare was overturned, what would it mean here?” was written by Sabrina Eaton.  Welcome to the conversation!

Please read her article.  There is nothing, absolutely nothing, that contradicts my 13 previous posts.  I will note that Ms. Eaton bothered to contact Senator Portman’s office for the story.  He predictably declined to comment on the court case, but his spokesman did note that premiums have gone up.  I would never contact Senator Portman’s office about a solution or improvement to our health care system for the same reason you wouldn’t bother to call my Rabbi for a ham recipe.  But she tried.

As previously noted, I was both surprised and pleased to see this coverage in the Plain Dealer.  Considering the potential impact on our area, I expected them to sound the alarm regularly.  Imagine my shock when I went to their website to link this article.  It took some effort to find it.  Ms. Eaton’s article was posted on Cleveland.com on May 8, 2020, over two weeks earlier!  I guess Greater Clevelanders are lucky that there was so little going on this Memorial Day weekend that her article finally made it to print.  And though I have readers across the country, I would never compare the reach of my little blog to the readership of the once formidable Plain Dealer or its disorganized website.  An issue that impacts nearly 20% of our nation’s economy, the lives of millions of Ohioans, and the financial stability of our hospitals deserves our attention.  In the old days we could count on our newspapers to bring us the information we needed.

Will the Texas lawsuit succeed?  Stranger things have happened.  I promise to keep you informed.  And to keep sounding the alarm.

DAVE

www.cunixinsurance.com

Picture – Thankfully Loud – David L Cunix

 

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The Fear Before Now

Health insurance used to be hard to get and expensive.  It is no longer hard to get health insurance, but it certainly is expensive.  In that health insurance is the way most Americans access and pay for their health care, it was very important to make it easier for us to become insured.

Too many of us forget what it once was like to purchase insurance.  In ancient times, pre-2014, your agent would ask you questions about your health, occupation, driving record, and hobbies.  If you needed coverage for a spouse or children, we needed all of that information on each of them, too.  As you can imagine, there were plenty of adults with Diabetes (Type 1 or 2), cancers, and sports injuries that either prevented them from acquiring coverage or resulted in higher premiums.  Some policies waived (excluded) preexisting conditions.  Some policies accepted an individual and his/her preexisting conditions after extensive conversations with the underwriters and the insurer had collected all of the pertinent medical records.

Insurance companies hate preexisting conditions, the difference between a risk and a certainty.  Children were an agent’s biggest challenge.  Ask any agent.  We remember the children we fought to cover.  There were children, sometimes babies, with cystic fibrosis, heart conditions, and even adolescents with ADHD.  We fought and we fought and most of the time we succeeded at finding the families health insurance.

No one wants to be responsible for the payment of the costs associated with preexisting conditions.  Not even the government.  Today’s proof comes courtesy of The Military Times.  The Pentagon has confirmed a recently released memo that stated that any recruit who has been diagnosed as having had COVID-19 will be permanently disqualified.  Permanently.  We have no idea what costs may be incurred 5, 10, or even 20 years from now by those who survive the Coronavirus.

We used to worry about getting insurance once we contracting an illness or suffered an injury even if we had a complete recovery.  That fear was real.  Now, thanks to the Patient Protection and Affordable Care Act (Obamacare), we no longer have that concern.  That could change if Donald Trump and 18 Republican governors have their way.

This blog has extensively covered the Texas lawsuit, the effort to declare Obamacare unconstitutional which would eliminate coverage for preexisting conditions and throw our entire system into disarray.  This past Wednesday was an important milepost, the last day for the Trump administration to disengage from the case as it heads to the Supreme Court.  Instead, President Trump said, “We want to terminate health care under Obamacare”.  What would happen if he is successful and Obamacare destroyed?  He has no idea.  What is his alternative, his replacement for our current system?  Trust him, it will be great.

Senator Lamar Alexander (R-TN) was interviewed by Chuck Todd on Meet The Press (5/20/2020).  The Senator expressed disappointment that Trump decided to stay a part of the lawsuit.  It was one thing for Senator Alexander and other Congressional Republicans to cast dozens of meaningless votes to dismantle Obamacare.  It is entirely different to actually be a part of an action that could succeed in harming millions of Americans.

It is amazing that Texas, with almost 25% uninsured, the highest in the country, wants to impose its success on the rest of us.

States suing to immediately end the Patient Protection and Affordable Care Act:

Texas                                 Alabama

Arkansas                            Arizona

Florida                               Georgia

Indiana                              Kansas

Louisiana                           Mississippi

Missouri                            Nebraska

North Dakota                    South Carolina

South Dakota                     Tennessee

Utah                                  West Virginia

These states were part of the lawsuit, but dropped off:

Maine                                Wisconsin

States defending the Patient Protection and Affordable Care Act (initial filing):

California                          Connecticut

District of Columbia          Delaware

Hawaii                               Illinois

Kentucky                            Massachusetts

Minnesota                         New Jersey

New York                           North Carolina

Oregon                              Rhode Island

Vermont                            Virginia

Washington

These states joined in the defense:

Colorado                           Iowa

Michigan                           Nevada

Data courtesy Center on Budget and Policy Priorities

There was fear before now, the fear that we would not be able to get health insurance for ourselves and our families due to a preexisting condition.  It was real.  The question, now in the middle of a pandemic, is whether that fear is about to return.

DAVE

www.cunixinsurance.com

Picture – The Other Side Of The Fence – David L Cunix

 

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How Do You Spell HSA?

Spelling was my Achilles Heel.  I couldn’t spell.  I even got a D in spelling on a report card!  And whether I was at home or school, when I asked an adult how to spell a word I would inevitably get the same answer, “Look it up”.  Looking up a word in a dictionary, decades before AI, meant that you took your best guess, failed, and kept on trying until you bumped into the correct spelling.  It was not efficient.  There was one benefit to this exercise.  Opening up a dictionary was like handing me a car with a full-tank of gasoline and access to the freeways.  There were no dead-ends or wrong turns.  And reading a dictionary was far more interesting than whatever project I had been assigned.

Our computers and phones now have spellcheck.  The big dictionary has been replaced by Google, Alexa, and Siri.  The information you need is at your fingertips or by simply asking your electronic assistant.  So I was very surprised when one of my life insurance clients recently asked me some questions about Health Savings Accounts (HSA).  I told him that the information was readily available and that I had covered this on my searchable blog.  He had little interest in reading the blog(!) and felt that I should put the information into a useable format for him and some of his friends and coworkers at a local large business.  I wrote him a letter.  Not only did I answer his questions he even insisted that I create a special page for this on my website.  Instead, I will just post the letter as part of today’s blog.

April 21, 2020 

Dear Roger (Name changed so that my attorney can sleep at night): 

It is important to remind you, up front, that I am an insurance agent not a CPA.  You should consult with your professional tax preparer about whether or not anything is deductible for you.  The information I am providing is based on my understanding of how these insurance policies impact my clients’ taxes. 

The term H.S.A. is normally used to refer to two very separate things.  Part One is a High Deductible Health Insurance Policy.  Part Two is a Health Savings Account.  You can have Part One without Part Two.  You cannot have Part Two without Part One!  This is very important and has been an area of confusion. 

A High Deductible Health Insurance Policy (HDHP):

  • For 2020, the IRS defines a high deductible health plan as any plan with a deductible of at least $1,400 for an individual or $2,800 for a family. An HDHP’s total yearly out-of-pocket expenses (including deductibles, copayments, and coinsurance) can’t be more than $6,900 for an individual or $13,800 for a family. (This limit doesn’t apply to out-of-network services.)
  • All covered services must apply to the deductible prior to any copays or coinsurance.
  • The exception has been Preventive Care performed by a network provider.
  • A recently added exception is the diagnosis and treatment for COVID 19 which will be covered without deductible, copayment, or coinsurance.
  • It has been generally ruled that even telemedicine, other than for COVID 19, cannot be provided free or with copayments until the deductible has been met. 

Once you have an HDHP, whether it is an individual policy or an employer sponsored group contract, you may open a Health Savings Account.

  • An HSA may be opened through an insurer, a bank affiliated with an insurer, a bank, or an online HSA bank
  • The employer may contribute $0 to the annual maximum
  • An individual or employee may contribute between $0 to the maximum
  • The annual maximum is the same regardless of who is contributing
  • The maximum contribution for 2020 is $3,550 for an individual and $7,100 for a family.
  • The catch-up contribution limit for those over age 55 will remain at $1,000.

 Medicare:

A friend of mine, an attorney, had a couple of quick questions about Medicare.  He will be turning 65 soon and needed to confirm that he didn’t have to sign up for Medicare Part B since he plans to stay on his wife’s group health policy.  I verified that his wife works for a company with over 20 employees.  So yes, he doesn’t need Medicare Part B.  But, I asked, is the group plan a High Deductible Health Savings Account (HSA) Qualified Policy and do you contribute to the HSA?  He confirmed that Yes and Yes.  In that case, he must renounce Medicare Part A, too.  You cannot contribute to a Health Savings Account if you have Medicare.  In fact, there is a six month look-back.  He didn’t know.  And if an attorney could have accidentally screwed this up, what are the chances that your average office worker or machinist couldn’t make the same mistake? 

The Medicare issue is particularly troubling.  The HR departments do not discuss this with employees.  I have talked with Senator Brown’s office about this. They have looked into correcting this, but there are not enough people pushing on this to see action anytime soon. 

I hope that this answers your questions about High Deductible Health Insurance Policies and Health Savings Accounts.

 

The good news is that now, if you search this blog or ask Google, you might come up with this information.  The bad news is that you won’t spend an hour or two getting lost on other tangents learning all kinds of interesting stuff you wouldn’t otherwise know.

DAVE

www.cunixinsurance.com

Picture – Old School – David L Cunix

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A Tool, Not A Weapon

The Patient Protection and Affordable Care Act (Obamacare) was designed to be a tool, a way to improve healthcare in our country and the health insurance that provides the access and payment for that care.  It certainly wasn’t a great tool.  This blog has detailed many of the PPACA’s flaws and shortcomings, but the goals were always about more care for more people.  Through the last ten years many Americans paid less per month for comprehensive coverage and, unfortunately, many Americans have paid more.  There certainly were ways to improve the law.  Few were ever tried.

As previous national health insurance programs that were designed to cover preexisting conditions such as Medicare Part A, Part B, and even Part D (Rx), the PPACA requires individuals to enroll in a timely manner.  Left to their own devices, many people would delay purchasing insurance until they had an immediate need.

Obamacare has an Open Enrollment Period that currently runs from November 1st to December 15th each year.  It used to be a lot longer until the current administration shrunk it to only six weeks in 2017.  There are also Special Enrollment Periods available to Americans who have involuntarily lost their coverage.  The combination of Open Enrollment and Special Enrollments usually meets most people’s needs.

These are not usual times.  States that run their own insurance exchanges have recognized the need to hold an emergency Open Enrollment Period to meet the insurance requirements of their citizens.  Other states, like Ohio, utilize the federal government’s healthcare.gov.  The federal government, read President Trump, is in a position to be a help or a hindrance.  Will Ohioans have an emergency Open Enrollment?  NO!  Donald Trump is happy to convert a tool into a weapon.

Here are some of the people who might benefit from an emergency Open Enrollment:

  • People who never bothered to purchase insurance
  • People who missed the shorter open enrollment period
  • Ohioans who purchased short term major medical and now want comprehensive coverage
  • Ohioans that purchased comprehensive coverage directly from the insurer.  Example – I have a client in her late 20’s.  She is a mechanical engineer making $55K per year.  Since she wouldn’t qualify for a tax credit subsidy, we didn’t have to go through the Exchange to get her policy.  That saves her time and money.  She lost her job.  Too bad.  This doesn’t qualify as a SEP.  If we got the Exchange opened, I could get her a subsidy to help her.
  • Individual policies are HMO contracts that can provide good LOCAL coverage.  If you live in Cleveland and send your child to school in Columbus or Denver or wherever, you will take the child off the Cleveland policy and buy a health plan for the school.  The schools are closed.  The kids are home.  We cannot put the child on the parent’s policy or offer the child a comprehensive policy to purchase.

There is only one reason to not have an emergency Open Enrollment.  By allowing citizens from across the country, many residents of battleground states, to purchase coverage, Trump would be admitting the value of the Patient Protection and Affordable Care Act, the law he is actively trying to invalidate.  His support of the Texas lawsuit which would rule the PPACA unconstitutional and eliminate coverage for, among other things, preexisting conditions has gone virtually unnoticed by the general public.  Much like the Coronavirus, many Americans will ignore the implications of the Texas lawsuit until in impacts them directly.  And again like the virus, when they lose their health insurance coverage it will not be dissimilar to being isolated on a ventilator at the end of a darkened hall.

Without a whole lot of thought or planning, Mr. Trump recently announced that the uninsured would have their COVID 19 related bills covered.  When pressed he declared that the hospitals would have to accept the Medicare funding level, as if that was sufficient.   Worse, the president decided to take the money from the desperately needed funds just allocated to our nation’s hospital systems.  We are back to spending the same dollar a couple of times and hoping nobody notices…

We have tools.  In the hands of the right people, the federal government, in concert with the states and major cities, can marshal the professionals needed to treat our sick, work to reduce our risks, and insure our general safety.  All we need are people who understand how to make our system work for us.  And, we need someone who doesn’t want to convert a tool into a weapon.

DAVE

www.cunixinsurance.com

Picture – Taking A Hammer To The Level

 

 

 

 

 

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PSA

Time for a quick Public Service Announcement from Health Insurance Issues With Dave:

By now almost all of us accept that the Coronavirus threat is real.  The two ways we can protect ourselves and others is to wash our hands properly for a full 20 seconds and to stay home as much as possible.  It turns out that lots of people are asymptomatic and capable of infecting others for days before they start coughing and/or running a fever.  It is important that even though you need to maximize social (physical) distancing, you shouldn’t let this force you to minimize social interaction.  My friend John in New Orleans, a veteran of Hurricane Katrina, has expressed to me his concerns about the mental health implications of both the virus and the necessary lockdown.  Stay connected.  Your friends, your family, and even your co-workers miss you.

The insurance companies have a variety of resources for all Americans, not just their clients.  Aetna has an excellent information post about coping with the obvious and reasonable fears that we are all experiencing with the Coronavirus pandemic.  This link is worth a couple of moments of your time.

Oscar has created a personal risk assessment survey that is available to both their clients and the general public.  This survey is no replacement for a test, but you will find it useful.  This is a reminder that the more information you have the better chance you have to protect yourself.

The federal government reports, per Dr. Fauci and Dr. Birx, that if we do everything correctly between 100,000 and 200,000 Americans will succumb to COVID 19.   Mr. Trump considers 100,000 dead Americans a victory.  Let’s be clear, there is nothing special about being 1 out of 100,000.  Stay Safe.  Stay Healthy.

DAVE

www.cunixinsurance.com

Picture – A Quiet Place in Tennessee – David L Cunix

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