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June 26, 2007

Women Must Be Taken Into Account In California Health System

The economic, logistical and social "obstacles" women face in obtaining access to a "full range of health services" must be "taken into account" as California lawmakers consider overhauling the state's health system, a San Francisco Chronicle editorial says (San Francisco Chronicle, 6/24).

Gov. Arnold Schwarzenegger (R) in January announced a proposal that would require all state residents to obtain health insurance and would share the cost among employers, individuals, health care providers, health insurers and the government (Kaiser Daily Health Policy Report, 1/9). A measure (AB 8) proposed by California Senate President Pro Tempore Don Perata (D) and Assembly Speaker Fabian Núñez (D) excludes a requirement in Schwarzenegger's proposal that all state residents obtain health insurance. Both chambers of the California Legislature earlier this month approved Democratic plans to overhaul the state health care system and provide coverage for more uninsured residents. Following the vote, Democratic lawmakers and a spokesperson for Schwarzenegger said that they will work during the summer to negotiate a compromise plan. (Kaiser Daily Health Policy Report, 6/25).

According to the Chronicle, the proposals should maintain current programs -- including the family planning services program Family PACT and the Medi-Cal breast and cervical cancer treatment program -- and boost financing for the "woefully underfunded" state hospitals and clinics that provide care to "millions of low-income" women. In addition, women should be provided access to "affordable coverage" for part-time workers, as well as protection from high out-of-pocket costs for "routine events," such as pregnancy, the editorial says. Also, any program that includes individual health plans should cover maternity services, preventive services and prescription drugs, according to the editorial.

Lawmakers "should remind themselves that women are the major consumers of health care" and "make sure to sustain and strengthen the heath care safety net that exists for millions of women," the editorial says (San Francisco Chronicle, 6/24).

Live in California? Click here to get your free California health insurance quote right now!

Posted by healthinsurance at 06:17 PM | Comments (0)

June 24, 2007

Anyone who's lost control of a speeding car knows the feeling: The world in front of the windshield suddenly looks like a movie running in slow motion … the disorientation, the loss of control, the seeming eternity until it all stops.

Such is the condition of the American system of health insurance. The vehicle began skidding out of control sometime in the past decade, but for many Americans that realization is just dawning. No one is predicting disintegration tomorrow, but without action a crack-up is all but inevitable. Look at the skid marks:

--The number of Americans without health insurance is growing … 47 million at last count, or 16 percent of the population. Of that total, 2.5 million live in New York. In Erie and Niagara counties, about 109,000 people … 10 percent of the population … lack health insurance.

--The cost of health insurance is rising two to three times faster than inflation.

--The proportion of companies offering health insurance is shrinking, and those who do offer it are restricting benefits and raising employees' costs through higher premiums and higher deductibles or co-pays.

--The number of Americans facing financial disaster because of health care costs … far and away the No. 1 cause of personal bankruptcy in the United States … is rising.

--Americans pay more for health care than citizens of any other nation, obtaining results that often are worse than those in countries that spend significantly less. And costs are expected to double to $4.1 trillion in 10 years, government economists say.

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Posted by healthinsurance at 04:40 PM | Comments (0)

June 22, 2007

Snapshot: Health Insurance: Can Californians Afford It?

The California Health Care Foundation has released a 32 page document with relatively little in the way of words to read but with simple graphs and charts showing how Californians with individual and small markets fare in the health insurance they have. "Snapshot: Health Insurance: Can Californians Afford It? 2007 Edition" shows, the premiums paid for both types of insurance, the out of pocket costs of individuals covered, how chronic illnesses affect these, and in the case of employment how much the employer and the worker each pay.

There is also a comparison of these figures between 2003 and 2006 with the trends showing an increase in premiums and out of pocket expenses, something most of us already know. The different figures for HMO's and PPO's are also broken out.

Among their major findings:

• The individual and small group markets are where the greatest number of uninsured Californians would get their coverage, if they could afford it. And these markets are particularly sensitive to price pressures.

• The costs of coverage and care represent a large share of income, particularly for individual purchasers. In 2006, a single person with median household income ($30,623) buying coverage in the individual market would have spent 16% of income on health care expenses. In the small group market, that same person would have spent 3.5% of income covering health care expenses. A full-time minimum wage worker would have spent 35 percent of income

• In exchange for lower monthly premiums, those purchasing coverage through the individual market bear a greater share of the costs of care. Insurance covered 54.6% of a typical consumer's medical bills in the individual market, compared to 83.3% in the small group market.

• For those with chronic conditions, annual out-of-pocket medical expenses are high. In 2006, a person with diabetes spent an estimated $3,275 if covered through the individual market or $1,101 if covered through a small group, well above the health insurance premium.

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Posted by healthinsurance at 06:40 PM | Comments (0)

June 20, 2007

Health insurance gap puts grads to the test

As graduates filed into the Mondavi Center for UC Davis commencement exercises last week, many chatted about what's possibly their last carefree summer before new careers limit them to two-week vacations.

What's not on their minds is the reality that between graduation and full-time employment, young people often lose health insurance. Some go uncovered for a year or more.

In California, 41 percent of people ages 18 to 35 are uninsured, according to a 2005 California Health Care Foundation survey.

Nationwide, 30.6 percent of 18- to 24-year-olds are uninsured, making them the largest population without coverage in 2005.

The numbers reflect an increase from 2004, when an estimated 13.7 million people ages 19 to 29 had no coverage. As recently as 2000, just 2.5 million were without health insurance, according to a 2005 survey by the Commonwealth Fund, a private health advocacy group based in New York.

Often students lose eligibility for school coverage after graduation and their parents' plans when they reach a certain age or are no longer full-time students. These are details that students and parents excited about the arrival of Graduation Day often overlook.

Today, as Gov. Arnold Schwarzenegger pushes a universal health plan and presidential candidates are pressed to take a stance on insurance, many students face the choice of buying often costly short-term policies or gambling on their health and simply winging it without a safety net.

Live in California? Click here for your free health insurance quote now!

Posted by healthinsurance at 10:29 AM | Comments (0)

June 18, 2007

Health care costs spark new tensions

Becky Bikul faced a tough choice the last time her union contract was up: take a smaller raise or pay more for health insurance.

The 29-year-old collections agent for AT&T opted for raises that barely keep pace with inflation, but in return received health insurance almost entirely covered by the company.

Businessman Bill Heller feels the pinch of soaring health costs from the opposite perspective. Each year around Christmas he learns he'll have to pay thousands more in the coming year to cover his 30 workers, who build air conditioning parts at a plant in North San Jose. With steel, copper and gasoline prices ticking up, Heller says, "It's all an assault on the bottom line."

As California Gov. Arnold Schwarzenegger and Democratic leaders negotiate legislation this summer to revamp the state's health care system, experts say no problem threatens to undermine their efforts more than surging costs. Insurance premiums this decade have ballooned 87 percent nationally — and at a similar clip in California — chipping away at profits and forcing many workers to pay more for shrinking benefits.

Rising costs have transformed health care from a problem primarily about the growing ranks of uninsured.

Creative Imaging Center!— some 6.6 million people in California go without benefits for all or part of any year — to one that touches nearly everyone.

That is especially so in the workplace, where health care costs are creating new tensions between companies and employees. Many businesses that used to provide expansive benefits are scaling them back and asking workers to sacrifice, in one form or another. And both sides are demanding action from government.

"A new era in the health care debate has emerged in the last few years, where a wide group of people are seeing costs go up and it's not economically sustainable," said Peter Harbage, an independent health care consultant based in Sacramento.

Earlier this decade, he said, it was harder to engage the public on health care.

Californians, click here for affordable health insurance!

Posted by healthinsurance at 12:12 PM | Comments (0)

June 15, 2007

California needs fed help on kids' health care

If California is to achieve the goal of ensuring that all children have health insurance, as Gov. Arnold Schwarzenegger and the Democratic leaders of the Legislature propose, Congress must do its part, too. Congress will soon consider reauthorization of the State Children's Health Insurance Program (SCHIP). To make universal health coverage for children a reality in California, Congress must expand funding for the program and give states flexibility to tailor their programs to local needs and conditions.

Created with bipartisan support in 1997, the health insurance program is a federal-state partnership aimed at expanding health care for children in working families that make too much to qualify for Medi-Cal, but not enough to afford health insurance.

California's program, known as Healthy Families, has been a major success. Healthy Families has helped reduce the number of uninsured children in the state by providing low-cost health coverage to about 800,000 children. Also www.insuremyhealth.com offers free health insurance quotes to anybody who lives in California.

Children covered by Healthy Families are more likely to receive preventive care, such as immunizations, less likely to pass up going to the doctor when they are sick, and are healthier overall. But the state cannot sustain this success, and build upon it, without help from Washington.

California's SCHIP allotment for the current federal fiscal year is $274 million, less than the cost of covering the number of children enrolled in Healthy Families. The state makes up the difference with funds carried forward from the program's early days when enrollment and costs were lower.

Click here for your free California health insurance quote now!

Posted by healthinsurance at 06:29 PM | Comments (0)

June 13, 2007

High Loss Ratios Undermine the Affordability of Health Insurance

Nationwide, states are unveiling health reform proposals dealing with insurance company loss ratios. California Gov. Arnold Schwarzenegger (R) and Pennsylvania Gov. Ed Rendell (D) have both introduced reforms that require insurance companies to increase their loss ratios to 85 percent--meaning at least 85 percent of collected premiums must be used to pay direct health expenditures.

Conversely, the North Dakota legislature and Gov. John Hoeven (R) on April 13 enacted Senate Bill 2154, which actually lowers the legally allowed medical insurance loss ratio for individual and small group coverage to 55 percent and 70 percent, respectively.

Which reform will be more effective?

Loss Ratios

A loss ratio is the percentage of premiums spent on direct patient care. Loss ratios are, in effect, price controls, seeking to limit the cost of insurance by controlling one of its primary components--administrative costs.

Administrative expenses include all the costs required to conduct the business of health insurance and provide customer services to the insured. These expenses include:

* the cost of collecting premiums and crediting them to the correct accounts;

* the cost of processing medical claims accurately, including cutting and sending checks for services and providing payment explanations;

* monitoring efforts to ensure patients, especially those with chronic medical conditions, are getting appropriate care;

* customer service staff to answer questions--often 24 hours a day, seven days a week;

* agent commissions;

* costs imposed by state laws, including premium taxes, as well as fees paid to independent providers to review claims, assessments for high-risk pools, and timely claims payment requirements; and

* profit and general overhead costs.

Insurers and health plans incur significant costs in their efforts to process and monitor claims and care. Unfortunately, while those efforts surely reduce claims--thereby reducing upward pressure on premiums--critics see only the "costs," not the benefits. They are ignorant of the fact that those "costs" may actually save money.

Contributing Factors

Loss-ratio laws often refer to the individual and group health insurance markets as if they are synonymous. They aren't. Many factors--including group size, premium amount, and plan design--may affect the cost of administering a plan.

For example, agents selling health insurance to individuals will need to meet separately with each client to asses his needs. To cover their added time and costs, agents selling individual insurance will generally command higher commissions than agents selling in the group market. Selling to individuals is a very time-consuming and expensive process, but necessary for those without access to group coverage.

Other administrative expenses are associated with processes that help reduce health care costs and improve health outcomes.

Proper claims payment systems, for example, can reduce duplicate payments. Preferred provider networks provide discounts on medical services in exchange for access fees. Managed care departments work with doctors and patients to find the most cost-effective care--sometimes even if that care is more expensive in the short run.

Click here for you free California health insurance quote now!

Posted by healthinsurance at 11:03 AM | Comments (0)

June 11, 2007

Blue Cross of California Agrees to Settle Rescission Class Action Lawsuit

Blue Cross of California recently entered a settlement agreement to resolve a class action lawsuit against the health insurer concerning the nature of its individual health insurance business practices. Blue Cross had been accused of using innocent mistakes on poorly worded insurance applications to rescind policies after insureds submitted costly claims. After concluding that it would lose money based on costly claims, the company allegedly undertook a campaign to find the slightest misrepresentations on the application for insurance and rescind the policy leaving individuals without coverage and with thousands of dollars in unpaid medical claims.

As a condition of the settlement, Blue Cross agreed to modify its health insurance application form to make it more readable and user friendly. Also, Blue Cross agreed to only rescind individual health insurance policies when policy applications contained intentional and wilful lies. In other words, insurers in California who make honest mistakes in an application for health insurance cannot have their policies taken away from them when they submit claims and need insurance the most.

According to the Los Angeles Times, Blue Cross of California agreed to a series of changes in business practices to help the consumer health insurance policy-holders:

The move is part of an effort to settle a class-action lawsuit on behalf of as many as 6,000 people canceled since late 2001. It is an about-face for Blue Cross in what had become known as "use-it-and-lose-it" health coverage because the cancellations were often triggered by patients' claims for treatment.

The insurer's new stance is aimed at ending rescissions based on policyholders' honest mistakes, inadvertent errors and other inconsistencies about their medical histories on applications for coverage. Consumers contend that the forms are purposely confusing, increasing the odds that applicants will make mistakes.

"This is a very significant consumer health victory ... something we believe they should have been following all along," said Cindy Ehnes, director of the state Department of Managed Health Care.

Californians, click here for your free health insurance quote now!

Posted by healthinsurance at 03:01 PM | Comments (0)

June 09, 2007

Regulation of rising health insurance rates passes US Assembly

The US California Assembly approved a bill that would bring health insurers in line with other kinds of insurance in California, requiring companies to defend and get permission for increases in their premiums.The bill, AB1554 by Asm. Dave Jones, will protect Californians against double-digit yearly health premium increases and outrageous fees and co-pays, said the Foundation for Taxpayer and Consumer Rights.

The bill faced ferocious opposition from insurance companies, said FTCR, congratulating the Assembly majority that stood up to the corporate pressure, as well as attempts by Gov. Arnold Schwarzenegger to ki ll the bill before it proceeds to the Senate. AB1552 faces the same opposing forces in the Senate, but if passed intact by both houses it will be difficult for Schwarzenegger to veto.

"California insurance companies are funneling billions of dollars to out-of-state corporate owners, even as health insurance premiums increase at a rate far ahead of medical inflation in general," said Jerry Flanagan, health policy director of the nonprofit, nonpartisan FTCR. "Without enactment of this bill, companies like Blue Cross, which mailed off nearly $1 billion of its California profits to a parent company in Indiana over three months, will keep using California health insurance purchasers as their corporate ATM."

Public review and regulation of rate increases is the underpinning of other proposed health care reforms, said FTCR. The group noted that when Californias auto insurance rates became the second most expensive in the nation, Proposition 103 cut rates and California fell to 21st in the pack even as costs soared in other states. The rate regulation of AB1554 would do the same for health insurance, while preserving the kind of vibrant, competitive market that rules auto insurance.

Click here for your free California health insurance quote now!

Posted by healthinsurance at 08:58 PM | Comments (0)

June 08, 2007

Health Net of California Redefines "Consumer-Directed Health Plans"

Building on the historical strengths of the California Health Maintenance Organization (HMO), Health Net of California is launching a plan that combines the affordability and focus on preventive care of the traditional HMO with the innovative tools and health education components of a "consumer-directed" plan.

"Health Net's Optimizer HMO is a consumer-directed plan with no deductible that provides tools to help make better health care decisions and incentives for demonstrating healthy behaviors," said Stephen Lynch, president of Health Net of California. "And because we know that those who make smart health care decisions spend fewer health care dollars, Optimizer HMO can cost significantly less than existing traditional HMOs."

Commenting on the Optimizer HMO, Peter V. Lee, chief executive officer of the Pacific Business Group on Health, a coalition of employers seeking to improve the quality, availability and affordability of health care, said, "We applaud efforts to build on the strengths of California integrated medical group models by bringing innovative benefit designs that focus on wellness and health improvement, rewards for healthy behaviors and risk reduction."

The Optimizer HMO comes with a Health Reimbursement Arrangement (HRA) allowing employers to provide accounts their employees may use to cover their out-of-pocket medical expenses using a special debit card. Members may easily track their HRA balances and out-of-pocket expenses online.

In addition to helping customers optimize their health care spending, the Optimizer HMO rewards healthy behavior. Customers receive $100 in their HRA if they complete a health risk questionnaire that provides a snapshot of their current health status, and an additional $100 if they have called a health coach through Health Net's Decision Power(SM) program within six months prior to a hospitalization.

Decision Power tools - including health coaches - educate customers about the full range of possible medical treatments and procedures so they may work more closely with their physicians in making health care decisions. Filling out the health risk questionnaire enables customers to access information on health improvement, maintain personal health records, and obtain information on health topics of the individual's choice.

Click here for your free California Health Net quote now!

Posted by healthinsurance at 12:36 PM | Comments (0)

June 07, 2007

Activists' health-care remedy

The same consumer group that spearheaded the ballot battle to regulate auto, home and other property insurers in California two decades ago is now targeting the health care industry.

With AB 1554 by Assemblyman Dave Jones, D-Sacramento, the Foundation for Taxpayer and Consumer Rights wants the Legislature to allow the state to set rates for medical coverage.

The bill would require health plans and health insurers licensed by the California Department of Managed Health Care and the California Department of Insurance to submit annual proposed rate increases for prior approval.

AB 1554 cleared an Assembly committee last week but still faces long odds in the Capitol, where health care insurers are among the biggest contributors to the campaign coffers of elected officials.

But supporters are preparing to take their cause to the ballot -- just as they did in 1988 when the Legislature declined to regulate auto and other property insurers, and voters approved Proposition 103.

Supporters estimate that landmark measure, which requires insurers to get prior rate approval from the state's insurance commissioner, has saved consumers billions of dollars while allowing insurers to make reasonable profits.

If consumer groups once again turn to the ballot, the issue of regulating health care insurers could be on the same ballot as next February's presidential primary, which promises to generate a large voter turnout.

Click here for your free California health insurance quote now!

Posted by healthinsurance at 12:28 AM | Comments (0)

June 05, 2007

Health Insurance Coverage in Times of Need

In May, I wrote about problems with health insurance companies in California. Specifically, an insured with Blue Cross and Blue Shield of California sued the company alleging bad faith arising out of the company's decision to rescind a health insurance policy based on high claims expenses. In the lawsuit, the plaintiffs alleged that the carrier accused the insureds of misrepresenting responses to questions contained in the application for health insurance only when it became clear the company would have to pay over $450,000 in medical expenses.

Across the country, health insurance companies make decisions to take away health insurance policies which have become too expensive based upon allegedly false statements contained in policy applications. If an insured truly misled an insurance company in the insurance policy application and in reliance on material misrepresentations, the carrier issued a health insurance policy, Arizona law allows the carrier to rescind the policy. I am curious whether carriers are using minor variations in application questions which have been prepared in good faith as a basis for decisions to rescind unprofitable health insurance policies.

Imagine diligently preparing an application for health insurance answering all questions as best as you can. You timely pay premiums believing that your carrier will provide benefits when needed. Suddenly, you suffer injuries in an accident and require costly medical care. When you or your medical providers submit these medical bills to the carrier for payment, the company decides that your claims expenses are just too costly. As a result, the insurance company undertakes a review of your policy application to see if you made any material misstatements in it. Why? The insurance company entered into a contract with you and promised to pay your medical expenses according to the terms of its policy. However, if a policy has become unprofitable, the company may decide to investigate to determine whether it may properly rescind your health insurance policy and eliminate claims payouts on this money-losing policy if you made false statements on your application for coverage. If you made a false statement of a material fact on your insurance application, the insurance company will likely attempt to deny your medical expense claims and rescind your insurance policy.

Click here for your free California health insurance quote now!

Posted by healthinsurance at 04:29 PM | Comments (0)

June 03, 2007

Health Insurer Cost Curb Takes Major Step in California Legislature

A bill by California Assemblymember Dave Jones that would require health insurance companies to justify and defend their rates and profits passed the Assembly Appropriations Committee today on a 12-5 vote, meaning that it will get a vote of the full Assembly this week. It was a significant defeat of powerful insurance industry lobbying. The Foundation for Taxpayer and Consumer Rights is a strong supporter of the bill, AB 1554.

No matter what health reforms are ultimately passed this year in California, Assemblyman Jones’ bill would keep down costs to the state, to employers and to individuals. It is particularly important to have these curbs on spiraling insurance premiums if either employers or individuals are required to buy health insurance.

The legislation is similar to requirements in the auto insurance market under Proposition 103 that have saved drivers billions of dollars since 1988 and driven down California auto premiums in relation to other states. AB 1554 would control the administrative waste and profiteering that allowed Blue Cross of California to keep, as overhead and profit, 50% of every premium dollar collected from individual policyholders, and that has increased insurance premiums to levels far above the increases in overall medical inflation.

The proposed legislation, AB 1554:

• Requires health plans to provide detailed financial information to the regulator with each premium increase request.

• Establishes a clear legislative directive that no rate, co-payment or deductible shall be approved or remain in effect which is deemed to be “unfair or excessive.”

• Allows consumers and consumer groups to intervene in rate review proceedings to ensure that the legislative intent is implemented.

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Posted by healthinsurance at 09:35 PM | Comments (0)