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Healthy Wisconsin
provokes healthy debate
By Jack E. Lohman
Recent news
coverage by the Small Business Times has
provoked excellent debate in the
Milwaukee Biz Blog about the benefits
and drawbacks of the State Senate's
Healthy Wisconsin (HW) plan. This plan
would eliminate the several billion dollars
Wisconsinites spend on the health insurance
bureaucracy, and spend it instead on direct
patient care. It'll also include those who
are currently unemployed.
HW is as close
to a single-payer system as we can really
get, politically, and it combines
staff-model health care networks (HCNs) with
traditional fee-for-service (FFS) care.
There are advantages and disadvantages to
each approach, and at least HW will allow
them to compete, which both gives patients a
choice and the public the opportunity to
sort out the differences.
There are advantages and disadvantages
to each approach, and HW will allow them to compete. This gives
patients a choice and the public the opportunity to sort out the
differences.
See the
complete Blog
HERE and join in the discussion, or
HERE for a printable copy including a comparison chart.
Asclepios - Your Weekly Medicare Consumer Advocacy Update
Cost-Effective
Health Care
July 23, 2007 Volume 7, Issue 28
A review of the annual reports
filed by the largest private Medicare plans shows
that, for every five dollars they receive in premiums, one
dollar goes to administrative overhead, marketing expenses and
profit. Original Medicare, on the other hand,
spends only 3 percent of the money it receives from taxpayers
and Part B premiums on administrative overhead. Put another way,
Original Medicare spends 97 percent of its budget on medical
care; private plans spend roughly 80 percent.
That helps explain why it costs taxpayers an extra $1,000 for
every person with Medicare who enrolls in a private Medicare
Advantage plan. But it doesn't explain why the Bush
administration, which claims to be worried about the financial
health of the Medicare program, objects to any efforts by
Congress to eliminate, or even reduce, the overpayments private
Medicare plans receive.
Here's another head-scratcher. The same administration that
wants to keep overpaying private Medicare plans (five-year price
tag: $65 billion) has threatened to veto a Senate bill that
spends roughly half that amount ($35 billion) to insure
some of the nine million children who now lack health
insurance. His alternative for them? Go to the emergency room,
the most expensive, least efficient way to receive care.
To recap: The administration wants to spend an extra
$65 billion to put people in private Medicare plans, when they
can get coverage for less in Original Medicare. But it refuses
to spend $35 billion to insure children from low-income working
families who cannot get health insurance from their jobs.
President Bush claims he is protecting the American people
from a Democratic plot to have the government take over health
insurance for everybody.
The truth is, the president isn't protecting the American
people. He's protecting his pals in the insurance industry. The
administration wants to keep shoveling money to the private
Medicare plans because it wants them to run the Medicare
program. And if Congress doesn't stop the overpayments, these
plans will wind up running it. Private plans
will transform Medicare from an efficient program that
guarantees its members a core set of reliable benefits, to a
voucher program that challenges its members to find a private
plan they can afford that will also provide the benefits they
need when they need them most.
With an extra $1,000, private plans can buy their members a
gym pass, a dental cleaning and a pair of eyeglasses benefits
that attract the healthiest, least costly members and still have
plenty left over for their shareholders. With each new member
enrolled in a private plan, Medicare moves one step closer to
privatization.
That's the real plot. Its time for Congress to throw a wrench
in the works.
Action Item --->>>
Please join the national call-in day to stop the
privatization of Medicare on Monday, July 23 (or even Tuesday!).
Call your congressional representatives today (toll free at
1-800-828-0498) and urge them to stop the overpayments to
private Medicare plans.
Following is an email I received
from Nathan Wilkes of Colorado that I thought would be of
interest. His son was born with a rare blood disorder like
hemophilia and his healthcare costs soared to over $1 million.
Fortunately he was employed, but unfortunately, it had great
impact on the employer and other employees.
My personal story is disturbing, though not necessarily for its
impact on our family.
Because of our high claims, my employer was forced into a HDHP/HSA
plan for 2005. Had we stayed with the PPO plan, it would have
seriously hurt my employer financially.
I remember the option well. It was November 2004. We were
offered a choice between two options:
1) Stay with our PPO. Total premiums would increase 36% and
employee contribution would jump from $2200 to $4810/year.
2) Switch to HDDP. Total premium + max HSA contribution would
still be 34% increase over previous year's premiums, but at
least $4,000 of that would be going pretax into an HSA.
Since we had to deal with massive cost shifting in either case,
everyone chose what seemed like the lesser of two evils at the
time and went with the HSA.
Personally, it has served our family fairly well. We've been
able to find 3rd-party financial assistance in covering part of
our deductibles and other out-of-pocket expenses when we hit our
maximum every January, which lets us keep some money in our
HSA. Then we can actually use some of that money for other
things that are never covered by insurance -- such as travel
to/from medical conferences.
It has pretty much screwed everyone else, though. There are
some that couldn't afford the extra $4,000 of cost-shifting that
first year (almost $6,00/year now), and have decided to roll the
dice. Here are a few anecdotes picked up in water cooler
conversation since the switch to the HDHP:
- coworker injured his ankle, but decided not to seek medical
attention because it would cost a minimum of $500 for the doc,
xrays, etc. and he didn't want to spend that much for "just a
sprain"
- coworker cut the back of his head open in a bicycle accident
and had a friend stitch it up to avoid the ER expense
- coworker, recently hired, has a pregnant wife and not enough
time to fund the HSA before his wife delivers. The annual
deductible is now higher than the IRS will allow in annual HSA
contributions and the max out-of-pocket is over $4000 higher
than can be contributed. His first child was premature and
spent time in the NICU, so they are at higher risk anyway. He
is planning on paying several thousands of dollars on a credit
card to cover the birth of this next child.
HDHP/HSAs are simply a nasty form of cost shifting that hits the
people in the middle the hardest, resulting in delayed or
substandard treatment and more financial problems for
consumers. I worry that more businesses will be attracted to
them simply because of the significant reduction in their outlay
for premiums.
Nathan
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