What Does the Public Want?

I find it interesting how the media says there is a large percentage of Americas that want public healthcare. When I talked to people, most of them seem confused. They like the idea a better system but, are surprised to learn that the systems that are used as models for reform, the Canadian or Massachusetts system, provide low levels of service and that is not what they want either.

So before you believe that Americas understand and really know what they are want when they answer these media surveys, please look at the results of a Kaiser Family Foundation (April 2009) survey, where they asked the basic question then provide the responders with some additional information and see how the results changed.

• 67% favor creating a public option “similar to Medicare”

• When told that public plans would be the first step toward single-payer, government-run health care, overall support drops to 41%
• When told that the government could have an unfair advantage over private plans, overall support drops to 32%

• 71% support “requiring employers to offer health insurance to their workers or pay money into a government fund”

• When told that mandates are “more fair because today some employers pay for health insurance and some do not,” overall support rises to 78 percent
• When told that the approach may mean some job loss, overall support drops to 27%

I believe, like most people, that the healthcare can be improved and be more cost effective. My concern is when Washington promote systems that provide low quality of service as a standard (see my blog http://yourlegacybenefits.blogspot.com/ for articles about the level of service provided in Canada and Massachusetts) instead real solutions like the Safeway system and a real medical records system. I just have to ask is it about finding a solution or wanting more governmental control?

By Ray Ward of Legacy Benefits & Insurance Services

RayWard@YourLegacyBenefits.com

www.YourLegacyBenefits.com

Senate's Health-Care Draft Calls for Most to Buy Insurance, Nixes Obama's 'Public Option'

The Senate has come out with their healthcare proposal; on the positive side they are not proposing a public plan. But there are questions:

1) The proposal requires a State-based Exchange for enrollments of individual and small groups, and this Exchange must be self sustaining. In the past, some in Washington blamed health brokers as an unneeded administrative cost. Is the Exchange a way to eliminate brokers? Wouldn’t the Exchange be an administrative cost? Good brokers provide not only comparative pricing service but communication and administrative services to their clients, will the Exchange provide quality services to the purchaser of these plans or can we expect DMV or Post Office quality service?

2) Why are undocumented workers granted an exemption form having coverage? Would this be a reason not to become documented? Will they still have access to services? I do not understand why we would have a law that forces our citizens and legal immigrates must pay for services that is given to people who haven’t become legal residents.

3) Missing in this proposal is mention of Section 125 pre-taxing of premiums, daycare expenses and unreimbursed medical expenses. While HSA’s out-of-pocket limits are mentioned the pre-taxing of these accounts is also not mentioned. I have a lot of clients that have these accounts it helps them manage their expenses and help keep money in their pocket. Since there are members of Congress that want to eliminate these accounts, I believe that they should clear in their proposal what their intent is.

Next question, what will the House proposes?

By Lori Montgomery and Shailagh Murray - Washington Post Staff Writers - Friday, June 19, 2009

A draft proposal in the Senate to overhaul the nation's health-care system would require most people to buy health insurance, authorize an expansion of Medicaid coverage and create consumer-owned cooperative plans instead of the government coverage that President Obama is seeking.

The document, distributed among members of the Senate Finance Committee yesterday afternoon, addressed none of the funding questions that have consumed House and Senate negotiators in recent days. But it included an array of coverage provisions that were drastically scaled back from earlier versions, as lawmakers seek to shrink the bill's overall cost. The proposal, for instance, would reduce the pool of middle-class beneficiaries eligible for a new tax credit meant to make insurance more affordable.

The absence of a "public option" marks perhaps the most significant omission. Obama and many Democrats had sought a public option to ensure affordable, universal coverage, but as many as 10 Senate Democrats have protested the idea as unfair to private insurers. In its place, the draft circulated yesterday outlines a co-op approach modeled after rural electricity and telecom providers, subject to government oversight and funded with federal seed money.

Yesterday, Senate Finance Committee Chairman Max Baucus (D-Mont.) met with four Republicans, including Sen. Charles Grassley (Iowa), the ranking GOP member on the panel, along with two Democratic colleagues in an attempt to find bipartisan consensus. Baucus dubbed the group "the coalition of the willing."

Meanwhile, in the House, Democrats are exploring a range of funding options, including a surtax on the rich and an increase in the payroll tax imposed on all U.S. workers. The list also includes new taxes on sugary drinks and alcohol, along with broader levies, such as a national value-added tax of up to 3 percent.

The Senate's preferred option -- taxing the health benefits that millions of Americans receive through their employers -- is also on the House list. So is Obama's favorite idea: limiting the value of itemized deductions for the nation's wealthiest 3 million taxpayers.

Rep. Richard Neal (D-Mass.), chairman of the Ways and Means subcommittee charged with developing a financing plan, said lawmakers have not "embraced any particular source of revenue." But he confirmed that big, broad-based taxes like the payroll tax and a value-added tax are under discussion, mainly because they have the potential to raise "a lot of money" for an expansion of health coverage expected to cost more than $1 trillion over the next decade.

The House will not unveil a financing plan until after the July 4 recess, Neal said, though House leaders were expected to release an outline of the rest of their plan today, with a goal of putting a bill to vote later this summer. The Senate is aiming to debate its legislation in July as well, and is seeking a bill that would cost less than $1 trillion.

Maintaining that tight schedule could prove difficult, though, because daunting issues remain in both chambers. One area of contention is the extent to which private employers must subsidize public coverage for their workers if the companies don't offer their own plan or if the premiums are unaffordable. The Congressional Budget Office has warned that if lawmakers don't find the right formula, employees may flee their company plans for federal coverage, sending government costs soaring.

The draft in the Senate committee spells out one possible solution: It would require employers to pay 50 percent of Medicaid costs for workers enrolled in the low-income program and 100 percent of the cost of health-insurance tax credits for eligible employees. Workers could forfeit employer coverage only if the cost exceeds 12.5 percent of their income.

The draft, earlier reported on by washingtonpost.com blogger Ezra Klein, spells out four options for requiring employers to provide coverage, with exemptions for firms with up to 200 employees. It would fine individuals who do not purchase coverage, though certain groups, including Native Americans and undocumented workers, would be exempted.

It also would loosen eligibility requirements for Medicaid, a proposal certain to alarm many governors who are grappling with budget crises.

How Safeway Is Cutting Health-Care Costs

Wow, this is a great example of private industry finding a solution to control costs verses the Federal government wanting to copy a program (MA system) that has produced increasing costs and reducing access to service.

Market-based solutions can reduce the national health-care bill by 40%.

JUNE 12, 2009 By STEVEN A. BURD

Effective health-care reform must meet two objectives: 1) It must secure coverage for all Americans, and 2) it must dramatically lower the cost of health care. Health-care spending has outpaced the rise in all other consumer spending by nearly a factor of three since 1980, increasing to 18% of GDP in 2009 from 9% of GDP. This disturbing trend will not change regardless of who pays these costs -- government or the private sector -- unless we can find a way to improve the health of our citizens. Failure to do so will make American companies less competitive in the global marketplace, increase taxes, and undermine our economy.

At Safeway we believe that well-designed health-care reform, utilizing market-based solutions, can ultimately reduce our nation's health-care bill by 40%. The key to achieving these savings is health-care plans that reward healthy behavior. As a self-insured employer, Safeway designed just such a plan in 2005 and has made continuous improvements each year. The results have been remarkable. During this four-year period, we have kept our per capita health-care costs flat (that includes both the employee and the employer portion), while most American companies' costs have increased 38% over the same four years.

Safeway's plan capitalizes on two key insights gained in 2005. The first is that 70% of all health-care costs are the direct result of behavior. The second insight, which is well understood by the providers of health care, is that 74% of all costs are confined to four chronic conditions (cardiovascular disease, cancer, diabetes and obesity). Furthermore, 80% of cardiovascular disease and diabetes is preventable, 60% of cancers are preventable, and more than 90% of obesity is preventable.

As much as we would like to take credit for being a health-care innovator, Safeway has done nothing more than borrow from the well-tested automobile insurance model. For decades, driving behavior has been correlated with accident risk and has therefore translated into premium differences among drivers. Stated somewhat differently, the auto-insurance industry has long recognized the role of personal responsibility. As a result, bad behaviors (like speeding, tickets for failure to follow the rules of the road, and frequency of accidents) are considered when establishing insurance premiums. Bad driver premiums are not subsidized by the good driver premiums.

As with most employers, Safeway's employees pay a portion of their own health care through premiums, co-pays and deductibles. The big difference between Safeway and most employers is that we have pronounced differences in premiums that reflect each covered member's behaviors. Our plan utilizes a provision in the 1996 Health Insurance Portability and Accountability Act that permits employers to differentiate premiums based on behaviors. Currently we are focused on tobacco usage, healthy weight, blood pressure and cholesterol levels.

Safeway's Healthy Measures program is completely voluntary and currently covers 74% of the insured nonunion work force. Employees are tested for the four measures cited above and receive premium discounts off a "base level" premium for each test they pass. Data is collected by outside parties and not shared with company management. If they pass all four tests, annual premiums are reduced $780 for individuals and $1,560 for families. Should they fail any or all tests, they can be tested again in 12 months. If they pass or have made appropriate progress on something like obesity, the company provides a refund equal to the premium differences established at the beginning of the plan year.

At Safeway, we are building a culture of health and fitness. The numbers speak for themselves. Our obesity and smoking rates are roughly 70% of the national average and our health-care costs for four years have been held constant. When surveyed, 78% of our employees rated our plan good, very good or excellent. In addition, 76% asked for more financial incentives to reward healthy behaviors. We have heard from dozens of employees who lost weight, lowered their blood-pressure and cholesterol levels, and are enjoying better health because of this program. Many discovered for the first time that they have high blood pressure, and others have been told by their doctor that they have added years to their life.

Today, we are constrained by current laws from increasing these incentives. We reward plan members $312 per year for not using tobacco, yet the annual cost of insuring a tobacco user is $1,400. Reform legislation needs to raise the federal legal limits so that incentives can better match the true incremental benefit of not engaging in these unhealthy behaviors. If these limits are appropriately increased, I am confident Safeway's per capita health-care costs will decline for at least another five years as our work force becomes healthier.

The Healthy Measures program currently applies only to our nonunion work force. While we have numerous health and wellness provisions in our union contracts, we are working with union leaders like Joe Hansen of the United Food and Commercial Workers to incorporate healthy measures provisions in our union work force as well.

While comprehensive health-care reform needs to address a number of other key issues, we believe that personal responsibility and financial incentives are the path to a healthier America. By our calculation, if the nation had adopted our approach in 2005, the nation's direct health-care bill would be $550 billion less than it is today. This is almost four times the $150 billion that most experts estimate to be the cost of covering today's 47 million uninsured. The implication is that we can achieve health-care reform with universal coverage and declining per capita health-care costs.

There is a very real possibility that we will see positive transformational health-care reform in the near future. I am encouraged by the effort I see on Capitol Hill, particularly the bipartisan effort in the Senate. While some tough issues remain, if we continue to work in a bipartisan manner I believe we will resolve these issues successfully and find agreement on meaningful reform.

Mr. Burd is CEO of Safeway Inc., and the founder of the Coalition to Advance Healthcare Reform.

Doctor Wait Times, Costs, ER Visits in Massachusetts Climb

There are many articles about the short falls in the Massachusetts new Universal Health Plan which many people say the federal government should use as the structure for socialized healthcare in the US, the main problems are long waits times to see a doctor, inability to find a primary care doctor, and higher costs. I found that this blog puts the information together in one spot. If you are not comfortable with the author, google the Boston Globe articles on this subject and you can confirm the information over many articles that have written.

The best laid schemes o’ mice and men
Gang alt a-gley (go off the planned line)

Robert Burns, 1759-1796

More people are seeking care in Massachusetts hospital emergency rooms, and the cost of caring for ER patients has soared 17% over two years. This is despite efforts to direct patients with nonurgent problems to primary care doctors instead, according to new state data. Visits to Massachusetts emergency rooms grew 7% between 2005 and 2007, to 2,469,295 visits. The estimated cost of treating those patients jumped from $826 million to $973 million.

“ER Visits, Costs in Massachusetts Climb,” Boston Globe, April 24, 2009

Long wait times in Boston may be driven in part by the healthcare reform initiative that was put in place in Massachusetts in 2006. The initiative succeeded in covering many of the state’s uninsured patients. However, it has been reported that many patients in Massachusetts are encountering difficulty in accessing physicians. Long appointmend times in Boston may signal what could happen nationally in the event that access to health care is expanded through healthcare reform. Increased demand resulting from improved access to care for 47 million uninsured people can be expexted to extend doctor appointment wait timen in many markets.

Merritt Hawkins & Associates, “2009 Survey of Physician Appointment Wait Times,” www.merritthawkins.com

Among the political cognoscenti, Massachusetts is considered the Bluest of the Blue States, the Elite of the Elite, the Leaders of the Liberal Health Reform Band. It is the state where President Obama received his law school education, where Senator Edward Kennedy has fought for a single payer system for 40 years, where Obama’s closest health care advisors, Dean David Cutler, PhD, of Harvard and Robert Blumenthal, M.D., of Massachusetts General and National Coordinator for Health Information Technology,reside, and where the nation’s first “universal health plan” was spawned and has been in operation for three years.

Yet, despite this political firepower, something seems to have gone askew. Massachusetts health costs are the highest in the land. Despite the highest concentration of physicians per capita and lowest rate of uninsured among the states (2.6%), people are having a hard time finding doctors, especially primary care practitioners but other specialists as well. Bay State residents are flocking to high-cost emergency rooms for care in unprecedented numbers. And all of this in an affluent states which is supposed to set an example for other states to follow.

The average wait times for appointments in Boston for cardiology are 21 days, dermatology 54 days, obstetrics-gynecology 70 days, orthopedic surgery 40 days, and family practice 63 days.

The average cumulative wait times for the 5 specialties just mentioned are,

Boston, 50 days

Philadelphia, 27 days

Los Angeles, 24 days

Houston, 23 days

Washington, D.C., 23 days

San Diego, 20 days

Minneapolis, 20 days

Dallas, 19 days

New York, 19 days

Denver, 15 days

Miami, 15 days

Portland, 14 days

Seattle, 14 days

Detroit, 12 days

Atlanta, 11 days

Conclusion

In Massachusetts and Boston, expanded access through a near-universal coverage plan has consequences - higher costs, increased ER use, harder times finding doctors, longer waiting times for doctor appointments.

Most people who say they understand HSAs really don't

This article points out a problem we have Health Saving Accounts, most people do not understand them well enough to make an informed decision. The triple tax savings and the flexibility of the account are key components and need to be communicated. Unfortunately it seems that most employers and brokers only discuss the reduced premiums. If you would like more information on HSA's, please contact me at RayWard@YourLegacyBenefits.com or visit the US Treasury site for details.

Wednesday, June 3, 2009 - post on blog: http://www.blogbythenumbers.com/2009/06/most-people-who-say-they-understand.html

That’s the word from Guardian Life Insurance. New research from the company shows that while 59% of consumers know of HSAs, most of those folks don’t understand that contributions and qualified withdrawals are tax free, 52% and 55% admitted as much respectively. Sixty percent said they didn’t know they can take their HSA with them if they switch jobs.

Guardian used Opinion Research Crop to survey 1,000 adults last December. Overall, just one in seven said they owned an HSA.

The knowledge gap is important, according to Guardian’s Tim Bireley, because HSAs coupled with HDHPs are a good fit for both employers and workers looking for ways to cope with expensive medical costs and health insurance bills.

His company thinks they’ve found a way to move the ball forward by pairing a critical illness program with an HSA/HDHP. That deals with a primary consumer concern about the products. The logic is that since workers are scared they won’t be able to find the money if illness strikes before they’ve booked a decent balance in the account, give them a CI policy to bridge that gap in the event they do get sick.

IRS Sees More HSAs

It seems that individuals who are claiming health saving account deductions are on the raise. I have found that more carriers are developing easy to understand and use plans that are cost effective for the member. If you would like to learn more about health saving accounts and compatible plans, please contact me at RayWard@YourLegacyBenefits.com.

Published 5/29/2009 By ALLISON BELL National Underwriters

The number of U.S. taxpayers claiming health savings account deductions increased 66% in 2007, to 581,438, from 351,170 in 2006.

The Internal Revenue Service has published that data in a collection of preliminary tax return data from 2007.

The total number of returns increased 3.3%, to 143 million, and total adjusted gross income increased 6.9%, to $8.5 trillion.

Over that same period, the value of HSA contribution deductions increased 71%, to $1.4 billion. The average HSA deduction per HSA deduction filer increased to $2,490, from $2,407 in 2006.

The number returns that included estate and trust income fell 1%, to 498,106.

The number of returns that included taxable individual retirement account distributions increased 11%, to 11 million, and the total value of those IRA distributions climbed 19%, to $149 billion.

A copy of the IRS 2007 preliminary data report is available here