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Thu. Sep 17, 2009

Health Prayer Reform

Our current “health care debate” has convinced me of one thing. We, as a country, are no longer capable of civil discourse about important topics. This is a straightjacket on democracy. We are no longer capable of doing Big Things, and we give off the appearance of a rather dumb country that is consumed by pettiness and increasingly incapable of civil discourse.

We, as a country, follow the examples set by our left/right leaders-celebrities, and regurgitate the ad hominem talking points they give us, or that we heard from some guy on the Internet. We try to shout each other down.

Because volume is a winning policy.

So many very angry people seem perfectly happy with the system we have. I know the majority of people have always been fully employed at a medium to large company that provides them with access to moderately priced insurance coverage. I know the majority of people have never run a small business, or been self-employed (two activities that allegedly cause this country to “thrive”), or wrestled with a COBRA payment after being laid off from their full time job, or worse, tried to convert COBRA to individual coverage. I know the majority of people have not encountered a major medical issue that strained or exceeded the limits of their existing coverage.

I know I may not be among the majority of American people on this topic. So I might have some differing insights to provide. And I am very very angry, too. It comes from two sources, both of which ought to anger you, too, even if you have moderately priced insurance.

The Insurance Surcharge

Imagine if you went to a store, and the item you purchased cost $99. Then the guy in line right behind you pays just $39 for the very same item. Would you be angry? Now, convert that “item” to a medical procedure. That is the difference in cost between someone who has insurance (gets the big bill) and someone who is “self-pay” (pays a fraction of the big bill).

I wish every American could go through the process of having a required treatment that is not covered by insurance. Meaning, one that you have to pay for out of your own pocket.

Then they could watch the doctor’s “cashier” total up a bill of $1,906 for that treatment, as I did in June. Thankfully my loud gulp was drowned out by her continuing, “now, give me a minute to apply the discounts for ‘self-pay’.” (“self pay” is the office euphemism they use for those who do not have insurance).

Actual price paid after “self-pay” discounts? $786. A difference of $1,120.

Yes, for those with the insurance coverage, that very same treatment costs 2.5 times as much. That’s when you notice, hmm, the doctor’s office seems to have multiple full time people who handle nothing but insurance filing and billing…

The hospital employed a group of about 30 people whose job it was to get authorizations from insurance companies before planned outpatient visits & procedures. (There was a different group who worked on the inpatient side.) Here’s a day in the life of one of those employees:

1. Pull up a list of upcoming appointments, along with the code for the expected procedure.
2. Find Patient A’s record.
3. Locate the phone number for their insurance company (this is why they photo copy your insurance card – it’s on there somewhere).
4. Call the insurance company and wander through their phone tree.
5. Sit on hold.
6. When the person on the other line answers, identify the patient and recite to them the code of the procedure.
7. Wait until the insurance company representative decides if they will pay.
8. If they agree to pay, the insurance company representative recites a different code back indicating their approval.
9. Write down the insurance company’s code and hang up.
10. There’s a system that actually records these phone calls so the hospital has additional proof that the insurance company agreed to pay. The employee now writes down yet another code from the voice recording system – the “receipt” for that call, essentially.
11. Input all of this into the hospital’s record keeping system.

Lather, rinse, repeat.

Of course we know that just because the insurance company says they will pay, it doesn’t mean they really will. There’s a whole different team of people who have to pick it up on the back end in that case.

Andrew Sullivan: “The View From Your Sickbed“

And then you realize, hmm, I bet if I was paying the 20% co-pay ($380), it might be another 120-180 days (i.e., half a freakin’ year) before the doctor’s office sees an actual payment from the insurance company for the remaining 80%. If at all…

That 11 step approval process doesn’t just apply to hospital outpatient procedures; it is also the same method by which all private practice physicians must attempt to verify benefits and coverage for every one of their office visits and procedures. At the end of that 11 step process, the insurance company has one final trump card: that entire process is hypothetical anyway. Without fail there is a disclaimer at the end of every one of these conversations, “Actual benefits may vary. Verification of patient’s coverage does not guarantee payment.” Can you imagine any other business operating with those uncertain payment conditions?

Andrew Sullivan: “The View From Your Sickbed 2“

This is a huge part of the reason why US healthcare is twice as expensive as other modern countries. Our privatized insurance industry makes it that way, forcing medical vendors to take on entire staffs devoted to trying to collect for covered procedures and treatments.

Now you may think, not my problem, I paid my $380 co-pay and the rest of the $1900 cost is covered, no matter how ridiculous it might be. Well, you pay for that excess as well. In the form of increased premiums taken from your paycheck, and the raise you don’t get because your company had to pay more for their employee health plan. In the form of a higher bill at the doctor or hospital, to pay for those extra full-time employees who do nothing but process your insurance and procure eventual payment.

It’s a vivid illustration of the fact we pay twice as much per capita for health care than other industrialized countries, yet get statistically worse care as a result. I’m a self-employed capitalist who believes in the marketplace, but can we afford for this one to be so grossly inefficient, and be one seventh of our economy?

Not anymore. Not me & my wife, anyway. Which brings us to part two…

Bankrupting The American Dream

From the above you might be asking, but Reid, how did you get to this uninsured place? Don’t you work for a living? Damn hard, yes I do, and always have. Between 1977 and 1985 I worked as a full time employee for four companies in three states. And not a single one of them ever offered me any opportunity to purchase health insurance. Tangentially, the owner of two of these companies drove a Rolls Royce. Oh, and in 1983, I broke my neck (spiral fracture of C-2).

Since 1987, I have been self-employed, which means you are buying into the individual policy market, i.e., you are screwed and will be paying far more than anyone else. A lucky self-employed person has a spouse who has a full time job at a corporation, and can get coverage through their policy.

That’s the status my wife and I held about a year and a half ago, with both of us covered under her policy at the real estate company where she worked as an accountant. The monthly cost was in the neighborhood of $300.

For most people, that’s where the story ends. They have moderately priced insurance that they rarely have to test beyond routine care, so what’s to complain about?

Well, you might remember the real estate industry hit a few bumps in their business plan last year, and my wife was laid off from her company. They had less money to count, so to speak.

Now, just because you’ve suddenly lost your job doesn’t mean you suddenly don’t need health care. But in the US, the two are tied inextricably. However, the law does require that you be given the chance to continue the same coverage under something called COBRA, and we were given the pricing for that.

$980 per month to continue the same coverage for two people; coverage that had cost less than one third of that the month before. Yes, you get to lose one of your two incomes, and face a tripling of your insurance premium.

And that’s when the first cut happens, the first “death panel,” if you will. I’ve been blessed to be a healthy guy for a long time, other than arthroscopic knee surgery in 1995 (back then I had a “catastrophic” insurance policy … which would not cover outpatient procedures … Yea 4 Insurance!). My wife, however, had one of those lovely “pre-existing conditions” that pretty much mandates continuing coverage, while I didn’t have even a single prescription to be filled.

So we opted to cover her only, at a cost of $495 per month. That was a big enough increase to absorb. And Susan picked up a lot of contract and temp work, but nothing that offered any kind of coverage. We had to stick with COBRA.

Of course, during that time my own pre-existing condition chose to reveal itself in an ugly way, and lacking insurance, I now fully expect to be paying out of my pocket for any treatments for that condition until Medicare kicks in.

Anyway, you get 18 months of COBRA eligibility. And when that runs out you get the opportunity to convert that same coverage to an individual policy. Well, Susan has hit the wall on COBRA, and we got the pricing chart for conversion:

Age	Single – Male	Single – Female	Family
40 – 49	$1,123.84	$1,475.63	$2,887.44

That’s the conversion option we’re given: a jump from $495 to nearly $1500 per month, just to cover Susan. And we’re lucky that we are grandparents of a young child rather than parents of one. Because that family policy that cost us $300 a month a mere year and a half ago would now be nearly $2900 a month.

$34,649.28 per year, for family coverage.

$17,707.56 per year, just to cover my wife.

There’s your “death panel.” It’s just got a dollar sign in front of it, and it’s entirely privatized and capitalist.

And if you want to be a pure capitalist about it, there’s your small business death panel as well. Go ahead, go out on your own and be self-employed, or start a small business to market your innovation. You know, pursue The American Dream.

Just put back a whole lotta jack for insurance before you do. Tens of thousands of dollars per year. Or pray you stay healthy.

It’s our Health Prayer System. That’s what my wife and I are left with, at this point. But the story has a (hopefully, prayerfully) happy ending. My wife has been working at a “temp-to-perm” position that should convert to “perm” in a month or so. And then there’s a 90 day waiting period. Then, maybe we can both be insured at an affordable rate once again. And just pray that we don’t have a major illness between now and, oh, say, January.

Yeah, this whole issue has me quite angry and no longer too understanding of the opposition.

If this has become such an ugly red/blue partisan issue, then I have to ask those who oppose this reform a question. Surely you believe in The American Dream, right? Work hard, play by the rules, and you’ll get ahead. Well … when two hard working citizens who are in above average health for their age are completely priced out of the health insurance market, as we have been, exactly which part of The American Dream is that?

Finally (if we simply must put the bottom line in partisan political terms), if the Republican President and GOP Congress were allowed to deficit-spend over $3 trillion on a “war of choice” that has in the end cost far more American lives than were taken on 9/11/2001, then I’m perfectly OK with a Democratic President and Congress spending $1 trillion on reforming our health care system to benefit millions of Americans.

However, I have little hope for real reform efforts coming out of Congress. At best, we will get a version so neutered and watered-down it may do more harm than good. Because we’ve just become a very dumb country, led by partisan boors, obsessed with minutia, and distracted by the next shiny thing they flash in our face.