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Dear Everyone!
Thanks for all the kind words many of you sent about my last edition.
I want to welcome new readers from various civic functions that I've attended recently as well as a lot of nice folks I met in Folsom's "old town" last week.
It's almost Halloween. What could be scarier than our state legislators in special session creating a "witches' brew" of healthcare proposals?
-Al
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MR MIP Is Gone For The Evening
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Some of you remember when I last talked about the Managed Risk Medical Insurance Pool, best known as Mister Mip? Well this week all agents were sent an email saying that there is now a waiting list to get on.
MRMIP is the policy of last resort. When you can't get anything else, and assuming you have the money, this is what you would get. There are three carriers that make up the plan, Blue Cross, Blue Shield, and Kaiser. For a 45 year old person Cross charges $592, Shield charges $971, and Kaiser asks $376.
All three plans are quite good. Why is Kaiser so much cheaper. I honestly don't know since I don't write Kaiser. (Why? I don't care for how it treats agents.... and I simply don't care for any HMO model... it's all about the HMO... not you! The HMO has an incentive NOT to treat you! The stories I could tell!)
I learned that MRMIP has not had a wait-list for as long as anyone can remember (I asked them and no one could tell me the last time there was a list.) It is funded partly by tobacco money and the agency that runs the pool (Medical Insurance Board) has a budget of $40 million a year, from what the lady told me.
MRMIP is a subsidized program. The premium that the insured pays (say $592 for the Blue Cross plan) is augmented by some of this $40 million. I have no idea how much, but it must be a lot because these are all high-end plans, none of them have a deductible.
"Say what?" Yeah, that's right. Can you and I buy a Blue Cross plan with no deductible? Nope. The lowest Cross deduct we can buy is a $500 deduct plan and that would cost a 45 year old $387. That's a $205 difference.
There is another difference. MRMIP will only pay a max of $75,000 a year with a lifetime (which is 36 months) benefit of $700,000 (vs. $5 million for a non MIP plan.) Even with the limits these are not the worst plans in the world... but I think they cost more than they should. It's basically a good program all in all. I'd like to see the rates lower, but believe it or not they never ask me what I think!
The issue here is WHY the wait-list? Could it have anything to do with the legislature in special-session on healthcare? The timing for this is very curious. You're going to tell me that there has not been a wait-list for MRMIP in several years... and that all of a sudden THIS MONTH there is one? Is is possible the plans have said "Sorry, we're not taking any more of this high-risk?" Are they sending a political message to the legislators... showing that they can play hardball? No. They wouldn't do that.
The big question is WHERE do I send clients who are sick and who can't get coverage through any other means? I think I got the answer this week. They are simply supposed to die... or spend down all of their assets so as to be eligible for Medicaid. Great choice. Tell me again why we don't need a single payor, universal coverage... at least for catastrophic medical occurrences.
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| The Veto-nator
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Arnold Schwarzenegger played the Terminator in his movies, has been called the Governator, and is now the Veto-nator after 86ing the AB 8 bill that would have taxed employers something like 8% in order to fund some kind of healthcare system... I'm not sure if it would have been free or not. I am sure it would have been a boondoggle... as is almost anything the state government tries to do.
It was a bad bill and deserved to be vetoed as it was the world-champion job-killer. Companies would flee this state faster than a chicken with the KFC Colonel behind it.
Believe it or not, there is no law that mandates that employers provide health coverage (either employer-paid or employee-shared) to anyone. Same for sick leave, paid vacation, or any other benefit. Companies do it to attract and retain good employees.
But as costs go out-of-sight, many companies are cutting back... they are offering to pay only 50% of cheaper, high-deduct plans instead of 80% of soup-to-nuts plans.
Everyone blames the insurance carriers first, (and the agents second.... thank you very much!)
No one wants to blame the medical community. But that's where the blame is. It's the cost of health care, stupid. Insurance is expensive because the pool (pile) of money it takes to pay for the standard of treatment that we want in this country HAS to be enormous.
Arnold vetoed the bill because he said it did nothing to lower costs.
Arnold seems to be the only person in state government who "gets it." Everyone else is trying to solve the problem by throwing more money at it. Sooner or later we will run out of money. What then?
There is only one way I know of to achieve universal healthcare and that is with a two-tier system... one free and paid from our federal taxes (perhaps instead of the war in Iraq?) and one that is market-driven for those who don't want the free system.
When you fly you can go economy class or first class.
You can send your kid to PS 45 or Andover.
You can stay at the Motel 6 or the Ritz.
We need more than one tier of service for healthcare.
We need to pay for the education of enough doctors and nurses who will work for teacher or social worker tax-free wages for 8 years. Then they can move out of the public system and into the private system.
That's what will have to happen in medicine. I don't see any other way.
No one seems to want to address the root cause of the problem: Insurance is expensive because medical care is expensive. Lower the cost of the first and you lower the cost of the second.
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| And Then There Is Greed |
I got a bill this week for an ultrasound exam where I was on the table for 10 minutes. Cost? $500 and that was the CONTRACT rate with Blue Shield. I'm sorry but there is no way you can convince me that the ten minutes the technician did the exam and the two minutes that the doctor spent to read the results was worth $500. That's just greed.
But what choice did I have? Well, I actually had more choice than I took advantage of. My family physician referred me to the vascular specialist who was just down the street from him. Obviously he had trust in this doctor. That's a good thing. But is this the ONLY doctor I could have seen?
Did I ask my doctor for a list of referrals? No I didn't.
Did I even phone the vascular doctor's office and ask what their price would be for the procedure? No I didn't.
Did I call my insurance company (Blue Shield) and ask what the negotiated rate was for this doctor with this procedure? No, I COULDN'T.
OK, I take the blame for the first two. But would it not be a convenience for everyone if doctor rates and procedures were made available to policy holders?
Why does this doctor charge so much? Because he can.
Why does the insurance company allow that much. Because they have to.
It's a balancing act here. Carriers have to offer "a good deal" to policy holders. But if the carriers lower the allowed rates too much, specialists will decline to participate in the PPO. If too many docs walk out, the carriers will not be able to attract buyers of their policies. On the other hand, docs can't just walk out of all their groups because no one BUT the insurance companies can afford to PAY the high rates that doctors and hospitals charge.
There is a love-hate, Texas Two-Step that goes on between docs and insurance companies.
If all the insurance companies closed their doors tomorrow and the HUGE pile of money used to pay healthcare was suddenly gone, what would happen to doctor and hospital rates? Think about it.
What will I do? I'm going to call the doctor's office and see if I can't get them to cut me a deal... i.e. lower their price. Will they do it? I don't know. If they do or if they don't, I'm going to tell their story to everyone I see... and let people make up their own mind about whether or not they might want to use him if the need arises.
Someday, some enterprising person will set up a website and ask people to submit the data on what their health plans paid to various doctors for various procedures. When we need special services like an ultrasound we could hit this website and do some research. I'd gladly pay $15 a year for that service.
Of course the best solution would be for the state to mandate that insurance companies publish their contracted rates.
However, the politicians are bought an paid for by the big insurance carriers, the AMA, and big pharma. Do I think you will ever see a mandate to make medical contract rates public? Yeah, when pigs fly!
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Well, that's a wrap for this issue. I hope you've found some of the info above useful and interesting. If you have questions about life or health coverage, safe-money annuities, or employer group benefits just give me a call or send email.
Sincerely,
Alan N Canton
InsuranceSolutions123
InsuranceSolutions123.com
916-962-9296
CA License # 0F31110
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Al Canton, Owner
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I'm Al Canton, owner of the Insurance Solutions Agency.
Everyone promises the best service, etc. So I won't bore you with that message.
Bottom line, I know health insurance, work-supplements, medicare, life, and annuities.
Most importantly, I'm honest. I will not put you in a product just for the money. I've been here 25 years and I've built my business reputation on integrity and honor.
It's that simple.
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