US health care question

[Ed Anger]

Whole Foods

Fuck Whole Foods. I like going in there dressed poorly and basking in the snobby stares.

They are GOP. 

?

http://abcnews.go.com/Business/story?id=8322658&page=1

Oh. I guess I need some fancy cheese then. 

[MadImmortalMan]

Discounting the obvious rattle about people waiting for treatment and all the rest, I'm curious about some of this guy's ideas. Particularly the ones about making it possible to get catastrophic coverage and HSA's. Gully? Would that actually make a decent impact? Intuitively, it sounds like catastrophic plans would make the kind of coverage healthy people really need easily available and cheap. It's also a bit odd that Whole Foods' CEO is GOP. 

I could tell it came from WSJ before I even saw the link.  It's a typical Cato Institute type BS that suffers from several fatal oversights.  There should be a Guller's rule for evaluating health insurance proposals:  if someone doesn't mention "adverse selection" anywhere in their proposal, it means that he has no idea what he's talking about.  Adverse selection is the propensity in a free market for bad risks to be more likely to buy insurance, and more of it, than good risks.  It's a very bad thing, and it affects health insurance to a much greater degree than any other form of insurance, for various reasons.

This flows into two other oversights.  The first one is the attack on employer health plans and their tax-exempt status.  Employer health plans in exchange for tax exemption are not allowed to discriminate based on health or age of the employees.  That limits adverse selection, because healthy and sick people alike are covered more or less involuntarily.  If you destroy that system by removing tax exemption, you will be leaving people to buy their health insurance on their own in the individual health insurance market, which is much more succeptible to adverse selection.

The second oversight is about the sick people.  How are the people with medical conditions supposed to get covered?  Health insurance companies don't like being adversely selected against, so they underwrite very vigorously to avoid insuring sick people.  They also tend to do very ethically-questionable things like canceling the coverage retroactively, if you happen to have a large medical claim after getting your insurance, and it then turns out that you didn't dot one of the i's on the application form.  That guy has no propsals for insuers of last resort or anything of that nature.

And the last thing is about letting people buy insurance across state lines.  In many ways regulation of insurance by individual states is highly inefficient.  However, letting people just shop across the state lines would make this problem even worse, because then companies would just find a state whose insurance department has the least regulations and consumer protections.  It's another idea that appeals to people who don't really know what they're talking about.  I do think that there is great merit in federal regulation of health insurance, because there does need to be one uniform regulatory system, just not the one that was a result of the race to the bottom.

In short, this guy doesn't propose anyting ground-breaking.  He's merely reiterating the Republican line on health insurance, and one that just can't survive informed scrutiny.

Good info. So what happens if there's no public option? It kinda seems like if we don't do that, we might as well not do anything--and it's looking pretty bad for the public option right now in Congress. Are there any steps that can be taken without going that far that would help? Federal HSAs with auto withholding and state contributions for the poor maybe? The thing about making costs transparent to the consumer sounds feasible. We've already got all the providers and payers set up on the HL-7 standard. There ought to be a way to compile cost information and make it available to the public from that. Hell, insurance companies probably already do that in some form for their own research.

[DGuller]

Good info. So what happens if there's no public option?

Depends on what happens with mandates.  With a combination of mandates, elimination of underwriting, and strict (but not too strict) regulation of private insurance companies to prevent gouging, you can get something meaningful passed.

As for public option, I'm actually in the camp with those who were highly suspicious of it.  Various forms of "public options" in insurance markets have a way of becoming the only option.  I don't think it was a critical piece to a useful healthcare reform.

[The Minsky Moment]

I've recently paid:

$55 for a GP visit.

$90 for an opthomologist visit.

$250 for a foot specialist visit. 

Note: prices not valid outside of Iowa.

[Iormlund]

Good info. So what happens if there's no public option? It kinda seems like if we don't do that, we might as well not do anything--and it's looking pretty bad for the public option right now in Congress. Are there any steps that can be taken without going that far that would help? Federal HSAs with auto withholding and state contributions for the poor maybe? The thing about making costs transparent to the consumer sounds feasible. We've already got all the providers and payers set up on the HL-7 standard. There ought to be a way to compile cost information and make it available to the public from that. Hell, insurance companies probably already do that in some form for their own research.

I¡'m pretty sure costs could be made transparent. In fact, my brother has been working on software that AFAIK instantly spews out future estimated costs per patient given a doctor's report. It's had a very good reception among several Spanish health institutions.

[Admiral Yi]

DGuller: your post suggests you believe the CEO thinks his suggestions will solve all health care issues.  He explicitly says here are 8 suggestions that will lower costs for everyone.

[Admiral Yi]

Wouldn't this just encourage all insurance companies to drop any kind of expensive treatment from the coverage? I fail to see how this would help at all. All it would do is skyrocket bankruptcies whenever someone gets cancer, MS or any other significant problem.

There are presumably some types of expensive coverage that Whole Food employees would like to see remain in their policies.

[citizen k]

Another thing to realize about US healthcare is that since the insurance as well as healthcare providers are entirely private sector, their overriding goal is to turn a profit; this leads to a lot of competition on prices and payouts where healthcare costs in the US probably aren't comparable to those of other countries with mandated insurance plans or mandated healthcare plans like the UK.

There are not-for-profit co-ops. I also thought there were some public hospitals. And I use public insurance.

[DGuller]

DGuller: your post suggests you believe the CEO thinks his suggestions will solve all health care issues.  He explicitly says here are 8 suggestions that will lower costs for everyone.

The problem is that his suggestions open a Pandora box of other unintended consequences that would most likely makes things worse rather than better on the whole.  Failure to address them is a sign of someone who didn't think things through.

[Razgovory]

Here's an eye opening statistic.

http://www.msnbc.msn.com/id/31103572/

Medical bills tied to 60 percent of bankruptcies

Most families had health insurance, but still overwhelmed by health debt

WASHINGTON - Medical bills are involved in more than 60 percent of U.S. personal bankruptcies, an increase of 50 percent in just six years, U.S. researchers reported on Thursday.

More than 75 percent of these bankrupt families had health insurance but still were overwhelmed by their medical debts, the team at Harvard Law School, Harvard Medical School and Ohio University reported in the American Journal of Medicine.

"Using a conservative definition, 62.1 percent of all bankruptcies in 2007 were medical; 92 percent of these medical debtors had medical debts over $5,000, or 10 percent of pretax family income," the researchers wrote.

"Most medical debtors were well-educated, owned homes and had middle-class occupations."

The researchers, whose work was paid for by the Robert Wood Johnson Foundation, said the share of bankruptcies that could be blamed on medical problems rose by 50 percent from 2001 to 2007.

...

"Among common diagnoses, nonstroke neurologic illnesses such as multiple sclerosis were associated with the highest out-of-pocket expenditures (mean $34,167), followed by diabetes ($26,971), injuries ($25,096), stroke ($23,380), mental illnesses ($23,178), and heart disease ($21,955)," the researchers wrote.

Copyright 2009 Reuters.

No shit.  My family was this close to losing the house due to a catastrophic illness my father had.  There is a reason conspiracy theories about mandated abortion and death panels are floating about.  There's not much to like about our health system.  You'd have hard time defending the status quo.

[Iormlund]

There are not-for-profit co-ops. I also thought there were some public hospitals. And I use public insurance.

If it's not too much to ask, would you be able to get individual insurance at all?

[citizen k]

There are not-for-profit co-ops. I also thought there were some public hospitals. And I use public insurance.

If it's not too much to ask, would you be able to get individual insurance at all?

It would be prohibitively expensive. I have MS and the cost for my two medications is about $4,000 per month. Based on income and need I qualified for Medicare which pays for my prescriptions and other health costs.

[DGuller]

I personally couldn't get individual insurance when I was out of college and wasn't yet working.  The prices were just completely insane, and would be appropriate only if I were a diabetic dying of cancer.  I think I detailed my frustrations on the old Languish back then.  I lived in New York at the time, though, which is one of the most dysfunctional states when it comes to any kind of insurance.

[MadImmortalMan]

It would be prohibitively expensive. I have MS and the cost for my two medications is about $4,000 per month. Based on income and need I qualified for Medicare which pays for my prescriptions and other health costs.

Hey, this is America. Aren't we supposed to be letting you rot in the streets or something? We have a strawman to live up to after all. :p

[Iormlund]

Wouldn't this just encourage all insurance companies to drop any kind of expensive treatment from the coverage? I fail to see how this would help at all. All it would do is skyrocket bankruptcies whenever someone gets cancer, MS or any other significant problem.

There are presumably some types of expensive coverage that Whole Food employees would like to see remain in their policies.

That's fine, except no sane insurer would offer that kind of policy. It's just not financially viable to aim for the sick or elderly. Let me put my case as an example: in the last two years I've been a total of 2 months at the hospital. I've had 4 scans, 4 barium swallow tests, innumerable blood tests, visited my specialist around 30 times, had half a meter worth of intestine taken out. Been unable to work for 7 or so months. I've got 50% chance of needing further surgery. Unless a cure is found I'll be on drugs for the rest o my life - and while those I've taken so far are relatively cheap that will surely change once better ones are discovered.

Now, what kind of insurer you think would aim for me?