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July 30, 2008

Federal Standards For Long-Term Care Insurance Policies Needed, Witnesses At House Hearing Say

Witnesses on Thursday at a House Energy and Commerce Oversight and Investigations Subcommittee hearing called on federal lawmakers to require minimum standards for private long-term care insurance policies, CQ HealthBeat reports. Bonnie Burns, a training and policy specialist at California Health Advocates, said that, because states regulate such policies, the standards offered differ based on where policyholders live. She said, "It should not depend on the state a person lives in whether they have a quality product," adding, "There's a disconnect between those services available in a community and the way they are described in a California insurance policy, and no two companies have the same definitions."

Some witnesses also raised concerns about large premium increases for long-term care insurance policies. Washington State Insurance Commissioner Mike Kreidler in written testimony said, "The majority of consumer complaints my office receives about long-term care insurance are about the double-digit rate increase they received on products they purchased in the late '80s and early to mid '90s."

In addition, witnesses discussed the inconsistencies in denials of claims submitted under long-term care insurance policies. Burns said that such denials often appear "completely unpredictable." However, according to Marc Cohen, president of the long-term care research and consulting firm Life Plans, a recent survey conducted by the company found that, among 1,500 policyholders who filed claims under long-term care insurance policies, 94% reported no unresolved disagreements with their California health insurers and that insurers denied only 4% of those claims.

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Posted by healthinsurance at 08:43 PM | Comments (0)

July 18, 2008

Rising Costs and Universal Health Care in California

As you know, since most of you are co-authors of this bill, SB 840 is California’s plan to establish a functional, modern, universal health care system for the 21st Century.

This bill covers every California resident with comprehensive, affordable health benefits, contains the growth in health care spending while improving quality.

And most importantly it guarantees every patient with total choice of their doctors and hospitals.

Each year health care costs grow 2-3 times faster than wages. The Journal of Health Affairs recently reported that health care spending will nearly double over the next decade. This means that, in 10 years, healthcare will cost 20 cents of every dollar our nation produces.

With that kind of cost inflation, discussions about covering the uninsured are pointless. Our failure to address this problem is close to gross negligence.

In the real world, 50% of bankruptcies are due to medical costs, employers are eliminating benefits if they can, and if not, like so many school districts and other public employers, they may face bankruptcy.

Our own budget crisis is greatly affected by the rising health care costs. The state budget buys a lot of healthcare in Calfifornia - directly through public programs and as employers.

If costs grow 2 to 3 times faster than wages, but the taxes that pay for the health care are a function of wages, then we are basically stuck in quicksand - each year sinking deeper and deeper.

In response to exploding health care costs, we are dismantling our system. Not one of us in this room has the level of health care benefits we had 10 years ago – and we’re paying a lot more for what we still have.

The US is now in a state of severe health care rationing. Doctors’ reimbursements are frozen. Coverage for the insured is very fragile and unreliable due to rescission, improper denials, gutted benefits, and growing deductibles. Patients experience shockingly long wait times, shorter hospital stays, fewer specialist visits, limited drug formularies, and rushed doctor visits. And yet…costs keep rising.

In 2005, the Lewin Group completed a financial analysis of the bill which found that the bill would be fully funded in 2006 with a combined payroll tax of about 12%. The report additionally found that the bill would produce savings of about $29 billion in the first year alone, most of which will be spent on insuring the uninsured and improving the health care benefits for all of us.

The Lewin study found that SB 840 would save California businesses 16% off their employee benefit costs, while families would save hundreds of dollars a year and state and local government would save nearly $1 billion in the first year alone.

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

July 09, 2008

Kids health insurance program in California to close

he countdown has begun for families served by the Alameda Alliance for Health's Healthy Kids program.

Phone calls and letters continue to roll out to families this week after the Alliance's June 30 announcement that it expects close the Healthy Kids program on Sept. 30 because of a lack of funding and diminished hope for the creation of a state universal health care plan for children.

"We had thought it was going to be a two-to-three-year effort to make the policy (changes) happen," said Alliance Chief Executive Officer Ingrid Lamirault, referring to policy that would provide universal health care coverage for all California children, regardless of their immigration status.

But the story of Healthy Kids has reached its final page without the happy ending for which administrators were hoping.

Proposed state legislation, which would have provided more coverage for children, stalled in January in the face of California's budget crisis. With the stall, the final phase of Healthy Kids in Alameda County began.

Started in 2005, the program provides low-cost, comprehensive coverage for 1,050 children in low-income families not eligible for government-funded programs like Medi-Cal. There are Healthy Kids programs in 30 counties statewide serving more than 80,000 children.

The program's closure could leave those children without any insurance options and further strain county clinics and emergency rooms which likely will become the primary care centers for the uninsured.

About 95 percent of the children in the Alameda County program are undocumented immigrants.

The program, like in other counties, had been funded by public and private grants, but six months ago, "things started unraveling," said Lamirault.

Earlier this year, two separate health care reform bills sponsored by state Senate President Pro Tem Don Perata, D-Oakland, and former Assembly Speaker Fabian Nunez, D-Los Angeles, were held up in committee.

With hopes of universal health care legislation dashed at least for now, the program later learned it would lose more than half of its funding this year and the remainder over the next year and a half.

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Posted by healthinsurance at 10:38 PM | Comments (0)

July 06, 2008

Health Net of California Signs Agreement with Alvarado Hospital

Alvarado Hospital of San Diego and Health Net of California, Inc. have signed a new agreement that provides California Health Net members with access to health care at Alvarado Hospital.

The contract covers Health Net members with employer-sponsored, Individual & Family Plans, Medicare, Medi-Cal and Healthy Families coverage. Members have access to Alvarado's wide range of medical services, including medical and nursing care, inpatient and outpatient surgeries, many specialty services such as bariatrics and skull base surgery, and complete orthopedics, emergency room care and diagnostic testing.

"Our agreement means San Diegans covered by Health Net health insurance may continue receiving the same quality care they have come to know and trust from Alvarado Hospital," said Martha Smith, Health Net's vice president of Health Plan Network Management.

"We have long-established relationships with Health Net members, and we have excellent physicians on our medical care staff who have provided care to Health Net members for years," said Harris Koenig, Alvarado Hospital chief executive officer. "We are excited to have the opportunity through this new agreement to continue caring for them."

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Posted by healthinsurance at 04:21 PM | Comments (0)

July 01, 2008

California Health Insurance Companies Spend $10.3 Billion On Administration And Profit

Private health insurance companies regulated by the Department of Managed Health Care (DMHC) spend $6 billion each year on administration, and divert an additional $4.3 billion to profit, according to a report released by the California Medical Association (CMA). Prepared using data obtained under the Knox Keene Act, the report breaks down how private health insurance companies spend their revenues.

"This report paints in stark terms why health care costs are skyrocketing for Californians," said Dr. Richard Frankenstein, M.D., President of CMA. "Health insurance companies in California spend billions of California's health care dollars each year on administration, and for-profit insurers divert billions of dollars more to profit. Californians' health care dollars should be spent on health care, not on bureaucracy."

Currently, private health insurance companies regulated under Knox Keene - representing some 60% of the health insurance market - are required to spend no more than 15% of their revenues on administrative costs. CMA and other health care advocates believe the statute includes profits as administrative costs; health insurance companies exclude profits from the 15%, allowing them to spend as little as they want on actual California health care. SB 1440, a bill authored by Senator Sheila Kuehl and sponsored by CMA, would require insurance companies to spend 85% of their revenues on health care, driving down health care costs for consumers and potentially making coverage more affordable.

"It's not acceptable for us to ignore such massive waste in the California health insurance industry when Californians are being bankrupted by rising health insurance premiums and gutted benefits," stated Senator Kuehl. "California consumers have a right to know that there is a basic formula in the law for how much of their money is actually being spent on medical care. This is the least we should be doing."

If SB 1440 had been in effect in the last reporting year, HMOs would have spent $1.1 billion less on administrative costs and profit - money that would have gone instead to provide health care to their policyholders. Blue Cross policyholders alone would have benefitted from $700 million more in health care that instead went to administrative costs and profit.

The Department of Insurance (DOI) collects the same data as the DMHC, but the DOI refuses to make the data public. CMA strongly supports the DOI and DMHC releasing this information to the public so that consumers can make informed decisions about whether a health plan is spending their premiums on health care.

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Posted by healthinsurance at 01:16 PM | Comments (0)