Hundreds of Blue Cross and Blue Shield of New Mexico employees, joined by insurance brokers, health care providers, dignitaries and other guests, assembled on 11 acres Friday morning east of Balloon Fiesta Park for the ceremonial groundbreaking for the company's headquarters.
The 100,000-square-foot building is expected to be completed by December 2006. It will house 350 employees who work in the company's buildings on Indian School near Tramway NE, and on Wellesley NE, near Menaul and Carlisle. The building will accommodate 500 employees.
The $28 million headquarters is designed by Dekker Perich Sabatini.
Blue Cross and Blue Shield of New Mexico was founded in 1940. It is an affiliate of Chicago-based Health Care Service Corp.
Blue Cross and Blue Shield of New Mexico was in tough financial shape before it sold to Health Care Service Corp.
The Journal's Monday Business Outlook examines how the companies have fared since the transaction.
Sunday, July 31, 2005
Californians without health insurance
By Sarah Arnquist
FAIRFIELD - Adam Boyles loves to ride his motorcycle across Solano County's country roads, but a crash last spring left him with a $13,000 hospital bill.
Boyles, 22, doesn't have health insurance, leaving him to chip away at the medical bills in small monthly payments.
"The financial burden is definitely on my mind," he said.
Boyles is not alone. At least 6.5 million Californians lacked health insurance at some point in the last year, according to the California HealthCare Foundation. That number will grow every year as health-care costs rise at double-digit rates and fewer employers offer health insurance, according to industry experts.
No one feels secure anymore, said Anthony Wright, executive director of Health Access, a Sacramento-based nonprofit that works toward expanding health coverage to all Californians.
"People are not only a pink slip away, but the next job may not offer coverage at all," he said.
No longer are only the uninsured crying for help. Hospitals, doctors and government programs cry out that they can't sustain the skyrocketing health-care costs. The uninsured are just one piece - albeit a significant one - to why costs are rising, but increasing numbers of uninsured threaten the stability of the health-care system that all Americans rely on.
Gary Passama, CEO of NorthBay HealthCare, which operates hospitals in Fairfield and Vacaville, said he sees the impacts of the uninsured every day in his packed emergency rooms, full hospitals and receding bottom line.
"There needs to be a society-wide resolve to solve the problem of the uninsured," Passama said.
Out of reach
Boyles wants health insurance, but his welding job doesn't offer it. Living in Vacaville is expensive, and Boyles said he can save money by not paying monthly premiums.
"It's just something that doesn't affect me day to day so I don't really think of it as a priority like rent, food and gas," Boyles said.
In 2004, annual average health insurance premiums in California cost $3,695 for individuals and $9,950 for families - 60 percent higher than in 2000, according to the California HealthCare Foundation.
Most of the uninsured work. According to the U.S. Census, about 67 percent of uninsured adults worked full-time in 2003. As income levels decrease so does the probability of having health insurance. Three quarters of Californians without insurance have household incomes less than $50,000, according to the California HealthCare Foundation.
About one quarter of the uninsured qualify for existing public health care programs such as Medi-Cal and Healthy Families but aren't enrolled. About 20 percent of all California's uninsured are children and half of them qualify for public programs.
Employers pay part or all of insurance premiums for about 60 percent of Californians, but industry experts expect more employers to drop coverage every year. Boyles' employer, for example, hires him as an independent contractor, partly to not offer him health insurance.
Dr. Michael Sexton, an emergency room physician and president of the California Medical Association, said society should care about the uninsured. That's because all taxpayers end up paying for uninsured patients' medical care, which often consist of emergency room visits - which are costly and inefficient, Sexton said.
"The insured right now are paying for the uninsured, but they don't know it," Sexton said.
Here's how the cost-shifting works, Sexton explained. Government programs such as Medi-Cal or disproportionate share funding, absorb some of the costs. Hospitals and physicians absorb the rest. To compensate, they raise their prices and that results in higher medical costs and insurance premiums, Sexton said.
People with health insurance absorb two-thirds of the $43 billion in care given to the uninsured through higher premiums, according to a study done by Families USA, a nonprofit advocacy and education organization. The study estimated that annual families' premiums in California are $1,160 higher as a result.
Patient impact
NorthBay Medical Center and VacaValley Hospital expect to see a record number of patients in their emergency rooms this year. The hospital emergency rooms treated 16,865 patients between January and April this year, about 1,000 more patients than the same time period in 2004.
According to the Centers for Disease Control and Prevention, visits to the nation's emergency departments reached a record high of nearly 114 million in 2003, up 26 percent from 1993. The emergency room is the primary portal to care for most of the uninsured, said NorthBay's Passama.
"Our two hospitals have been providing a safety net to this community, and we consider it part of our role, but that safety net is starting to develop a huge hole," Passama said.
In 2004, NorthBay HealthCare lost $7.2 million - largely because it provided great amounts of uncompensated care, Passama said. That loss impacts the entire hospital, he said.
"People are having to wait in the ER for a hospital bed because the hospital is full," he said. "That's a direct result of hospital crowding by people who come in terribly sick to the ER because they delayed care."
In the emergency room, Dr. Sexton said he sees patients who are far sicker than in years past. He recalled one case when a mother of two young children endured excruciating pain for four days before she came to the emergency room at Kaiser in Marin County. Doctors told her she needed an appendectomy. The uninsured mother refused the surgery because she knew the medical bills would financially wipe out her family.
She finally gave in and had the life-saving surgery, but death was near, Sexton said. With increasing frequency, people avoid seeing a doctor for cheaper, preventative care, he said. Uninsured people only see a doctor when their conditions become unbearable, and they need the most expensive treatments, he said.
The Institute of Medicine estimates that at least 18,000 people die each year from treatable diseases because they lacked health insurance.
Hopeful signs
The uninsured are not going away. Their numbers are increasing, and this places ever more economic pressure on the overall health-care system, Passama said. That pressure is creating crises in some areas such as Los Angeles and San Jose, where emergency rooms and hospitals have closed, Passama said. Government officials know the system is nearing collapse, but only a major crisis will draw the political will to find working solutions, he said.
But hopeful signs exist.
California legislators introduced nine bills this session that would expand health coverage. The bills range from creating a single-payer system to cover all Californians to simplifying the eligibility process and boost enrollment for Medi-Cal, the public insurance program for the indigent.
Many advocates think the best step toward reform is first insuring all California children. Gov. Arnold Schwarzenneger supports insuring all children, and so do four out of five California voters, according to a California Endowment statewide survey.
A program known as the Children's Health Initiative will launch this fall or winter to offer comprehensive health care coverage to all Solano County children regardless or immigration status. Society benefits from healthy children who have health insurance, said Jacque McLaughlin, director of the Solano Kids Insurance Program who spearheaded the initiative to insure all local children.
"The extent to which we as a community can solve this problem is a real win for this county," McLaughlin said.
Wright thinks reform is near. He points out that Proposition 72 - a 2004 ballot measure that would have required employers with 200 or more employees to provide health insurance - failed by less than 1 percent.
"I think there has been momentum from that close election to continue to explore different ways to expand coverage," Wright said.
He admits, though, that reform might not happen soon enough.
"There may very well be a tipping point where the health care system we all rely on collapses," Wright said.
Boyles said he knows little about health policy. At times, though, he wonders why all Canadians have government provided universal health coverage and Americans don't.
"I think that us being a country of such stature and for us not to be able to offer benefits for cheaper and more people, it's kind of scary."
FAIRFIELD - Adam Boyles loves to ride his motorcycle across Solano County's country roads, but a crash last spring left him with a $13,000 hospital bill.
Boyles, 22, doesn't have health insurance, leaving him to chip away at the medical bills in small monthly payments.
"The financial burden is definitely on my mind," he said.
Boyles is not alone. At least 6.5 million Californians lacked health insurance at some point in the last year, according to the California HealthCare Foundation. That number will grow every year as health-care costs rise at double-digit rates and fewer employers offer health insurance, according to industry experts.
No one feels secure anymore, said Anthony Wright, executive director of Health Access, a Sacramento-based nonprofit that works toward expanding health coverage to all Californians.
"People are not only a pink slip away, but the next job may not offer coverage at all," he said.
No longer are only the uninsured crying for help. Hospitals, doctors and government programs cry out that they can't sustain the skyrocketing health-care costs. The uninsured are just one piece - albeit a significant one - to why costs are rising, but increasing numbers of uninsured threaten the stability of the health-care system that all Americans rely on.
Gary Passama, CEO of NorthBay HealthCare, which operates hospitals in Fairfield and Vacaville, said he sees the impacts of the uninsured every day in his packed emergency rooms, full hospitals and receding bottom line.
"There needs to be a society-wide resolve to solve the problem of the uninsured," Passama said.
Out of reach
Boyles wants health insurance, but his welding job doesn't offer it. Living in Vacaville is expensive, and Boyles said he can save money by not paying monthly premiums.
"It's just something that doesn't affect me day to day so I don't really think of it as a priority like rent, food and gas," Boyles said.
In 2004, annual average health insurance premiums in California cost $3,695 for individuals and $9,950 for families - 60 percent higher than in 2000, according to the California HealthCare Foundation.
Most of the uninsured work. According to the U.S. Census, about 67 percent of uninsured adults worked full-time in 2003. As income levels decrease so does the probability of having health insurance. Three quarters of Californians without insurance have household incomes less than $50,000, according to the California HealthCare Foundation.
About one quarter of the uninsured qualify for existing public health care programs such as Medi-Cal and Healthy Families but aren't enrolled. About 20 percent of all California's uninsured are children and half of them qualify for public programs.
Employers pay part or all of insurance premiums for about 60 percent of Californians, but industry experts expect more employers to drop coverage every year. Boyles' employer, for example, hires him as an independent contractor, partly to not offer him health insurance.
Dr. Michael Sexton, an emergency room physician and president of the California Medical Association, said society should care about the uninsured. That's because all taxpayers end up paying for uninsured patients' medical care, which often consist of emergency room visits - which are costly and inefficient, Sexton said.
"The insured right now are paying for the uninsured, but they don't know it," Sexton said.
Here's how the cost-shifting works, Sexton explained. Government programs such as Medi-Cal or disproportionate share funding, absorb some of the costs. Hospitals and physicians absorb the rest. To compensate, they raise their prices and that results in higher medical costs and insurance premiums, Sexton said.
People with health insurance absorb two-thirds of the $43 billion in care given to the uninsured through higher premiums, according to a study done by Families USA, a nonprofit advocacy and education organization. The study estimated that annual families' premiums in California are $1,160 higher as a result.
Patient impact
NorthBay Medical Center and VacaValley Hospital expect to see a record number of patients in their emergency rooms this year. The hospital emergency rooms treated 16,865 patients between January and April this year, about 1,000 more patients than the same time period in 2004.
According to the Centers for Disease Control and Prevention, visits to the nation's emergency departments reached a record high of nearly 114 million in 2003, up 26 percent from 1993. The emergency room is the primary portal to care for most of the uninsured, said NorthBay's Passama.
"Our two hospitals have been providing a safety net to this community, and we consider it part of our role, but that safety net is starting to develop a huge hole," Passama said.
In 2004, NorthBay HealthCare lost $7.2 million - largely because it provided great amounts of uncompensated care, Passama said. That loss impacts the entire hospital, he said.
"People are having to wait in the ER for a hospital bed because the hospital is full," he said. "That's a direct result of hospital crowding by people who come in terribly sick to the ER because they delayed care."
In the emergency room, Dr. Sexton said he sees patients who are far sicker than in years past. He recalled one case when a mother of two young children endured excruciating pain for four days before she came to the emergency room at Kaiser in Marin County. Doctors told her she needed an appendectomy. The uninsured mother refused the surgery because she knew the medical bills would financially wipe out her family.
She finally gave in and had the life-saving surgery, but death was near, Sexton said. With increasing frequency, people avoid seeing a doctor for cheaper, preventative care, he said. Uninsured people only see a doctor when their conditions become unbearable, and they need the most expensive treatments, he said.
The Institute of Medicine estimates that at least 18,000 people die each year from treatable diseases because they lacked health insurance.
Hopeful signs
The uninsured are not going away. Their numbers are increasing, and this places ever more economic pressure on the overall health-care system, Passama said. That pressure is creating crises in some areas such as Los Angeles and San Jose, where emergency rooms and hospitals have closed, Passama said. Government officials know the system is nearing collapse, but only a major crisis will draw the political will to find working solutions, he said.
But hopeful signs exist.
California legislators introduced nine bills this session that would expand health coverage. The bills range from creating a single-payer system to cover all Californians to simplifying the eligibility process and boost enrollment for Medi-Cal, the public insurance program for the indigent.
Many advocates think the best step toward reform is first insuring all California children. Gov. Arnold Schwarzenneger supports insuring all children, and so do four out of five California voters, according to a California Endowment statewide survey.
A program known as the Children's Health Initiative will launch this fall or winter to offer comprehensive health care coverage to all Solano County children regardless or immigration status. Society benefits from healthy children who have health insurance, said Jacque McLaughlin, director of the Solano Kids Insurance Program who spearheaded the initiative to insure all local children.
"The extent to which we as a community can solve this problem is a real win for this county," McLaughlin said.
Wright thinks reform is near. He points out that Proposition 72 - a 2004 ballot measure that would have required employers with 200 or more employees to provide health insurance - failed by less than 1 percent.
"I think there has been momentum from that close election to continue to explore different ways to expand coverage," Wright said.
He admits, though, that reform might not happen soon enough.
"There may very well be a tipping point where the health care system we all rely on collapses," Wright said.
Boyles said he knows little about health policy. At times, though, he wonders why all Canadians have government provided universal health coverage and Americans don't.
"I think that us being a country of such stature and for us not to be able to offer benefits for cheaper and more people, it's kind of scary."
Saturday, July 30, 2005
The Health Insurance Industry's Dilemma
An agent and consumer primer on what to consider when attempting to find low cost health insurance.
(PRWEB) July 30, 2005 -- In this day and age, it is becoming increasingly difficult for the American public to find low cost health insurance. Individual health plans require squeaky clean health histories, and rates are increasing at unprecedented percentages annually. In addition, there are many plans and brokers that simply don’t fully disclose plan details to the consumer. This leads to many people listening to what they want to hear and subsequently purchasing health plans without factual knowledge of all benefits and exclusions.
How does the public and the broker community combat these obstacles in order to find low cost health insurance? Following are a few ideas that may lead to a better understanding of what’s involved in the research and decision process:
•Brokers need to periodically attend training seminars sponsored by their respective health carriers in order to keep abreast of the latest health plans and industry changes.
•Brokers should not only focus on the benefits of the plans but also provide understanding of the major coverage exclusions.
•The consumer should work with a knowledgeable professional who understands the plans he represents and can guide the consumer to the plan that best suits his or her individual needs and budget.
•When researching on the internet, the consumer should be aware that many lead generation sources sell the information to a variety of brokers, and that said consumer may wind up being called by multiple agents selling the same plans.
•In most states, it costs the same for a consumer to work with an independent broker as it does if he or she deals directly with a health insurance carrier. Costs of plans are, in the majority of cases, regulated by state law.
•The consumer should understand four major coverage areas of his or her policy: major medical deductible, coinsurance percentage and maximum, doctor visit copays, and prescription benefits as well as be aware of major policy exclusions.
•Basically, the consumer should discuss his or her needs with a broker or representative with whom they feel comfortable and who will provide coverage details in writing prior to the final decision process.
•Finally, the consumer should stay in touch with their broker and periodically evaluate his or her health plan in order to keep costs under control and/or stay aware of any new plan entries in the marketplace.
Obtaining low cost health insurance is a challenging but necessary function in today’s society. By forming the right partnership, the consumer and the broker can work together to overcome the obstacles and obtain proper and affordable health coverage.
(PRWEB) July 30, 2005 -- In this day and age, it is becoming increasingly difficult for the American public to find low cost health insurance. Individual health plans require squeaky clean health histories, and rates are increasing at unprecedented percentages annually. In addition, there are many plans and brokers that simply don’t fully disclose plan details to the consumer. This leads to many people listening to what they want to hear and subsequently purchasing health plans without factual knowledge of all benefits and exclusions.
How does the public and the broker community combat these obstacles in order to find low cost health insurance? Following are a few ideas that may lead to a better understanding of what’s involved in the research and decision process:
•Brokers need to periodically attend training seminars sponsored by their respective health carriers in order to keep abreast of the latest health plans and industry changes.
•Brokers should not only focus on the benefits of the plans but also provide understanding of the major coverage exclusions.
•The consumer should work with a knowledgeable professional who understands the plans he represents and can guide the consumer to the plan that best suits his or her individual needs and budget.
•When researching on the internet, the consumer should be aware that many lead generation sources sell the information to a variety of brokers, and that said consumer may wind up being called by multiple agents selling the same plans.
•In most states, it costs the same for a consumer to work with an independent broker as it does if he or she deals directly with a health insurance carrier. Costs of plans are, in the majority of cases, regulated by state law.
•The consumer should understand four major coverage areas of his or her policy: major medical deductible, coinsurance percentage and maximum, doctor visit copays, and prescription benefits as well as be aware of major policy exclusions.
•Basically, the consumer should discuss his or her needs with a broker or representative with whom they feel comfortable and who will provide coverage details in writing prior to the final decision process.
•Finally, the consumer should stay in touch with their broker and periodically evaluate his or her health plan in order to keep costs under control and/or stay aware of any new plan entries in the marketplace.
Obtaining low cost health insurance is a challenging but necessary function in today’s society. By forming the right partnership, the consumer and the broker can work together to overcome the obstacles and obtain proper and affordable health coverage.
Company ordered to stop selling health insurance
The state Office of the Insurance Commissioner has ordered Evolution Services Inc. to stop selling illegal health insurance in the state, according to an announcement.
The state said the South Jordan, Utah-based company has been operating as a Multiple-Employer Welfare Arrangement. Such organizations are established to provide health and welfare benefits to employees of two or more unrelated employers who are not involved in a collective bargaining agreement.
The arrangements are exempt from regulation by the state, and from certain taxes, the state said.
The company contends that it is self-insuring its own employees, but Insurance Commissioner Mike Kreidler said his agency knows of seven small businesses that have enrolled in Evolution's health plans.
"The employers received access to the health plan in return for signing a stock option agreement with Evolution Services," Kreidler said in a statement. "Although these businesses physically retained control of their employees, the intention of the agreements was to transfer control of their company to Evolution Services in order to shirk state regulation."
The state said the South Jordan, Utah-based company has been operating as a Multiple-Employer Welfare Arrangement. Such organizations are established to provide health and welfare benefits to employees of two or more unrelated employers who are not involved in a collective bargaining agreement.
The arrangements are exempt from regulation by the state, and from certain taxes, the state said.
The company contends that it is self-insuring its own employees, but Insurance Commissioner Mike Kreidler said his agency knows of seven small businesses that have enrolled in Evolution's health plans.
"The employers received access to the health plan in return for signing a stock option agreement with Evolution Services," Kreidler said in a statement. "Although these businesses physically retained control of their employees, the intention of the agreements was to transfer control of their company to Evolution Services in order to shirk state regulation."
Fairness on health insurance
By Steven Baddour and Jon Hurst | July 30, 2005
A BURNING question for Massachusetts lawmakers as they ponder major health reform legislation: Why do health insurance companies in Massachusetts that reimburse hospitals the same rate for the same service charge a small business person $2,000 more per year for health insurance than an employee of a large corporation?
The answer is simple -- because they can. There is no competition and no regulation to prevent this price inflation from happening. In Massachusetts, large companies negotiate with insurers for a competitive rate for their employees as a group. But for small business people, state law prohibits them from joining together to do the same. The result is that small business owners are left to choose between paying inflated annual premiums or going without health insurance.
Given the situation, it is not surprising that small business owners in Massachusetts face an acute and growing problem -- providing reasonably priced health insurance to their employees. Today, approximately 460,000 Massachusetts residents are without health insurance and small business employees comprise nearly 60 percent of all uninsured workers in the Commonwealth.
This discriminatory policy not only hurts small business owners, it hurts everyone; the annual cost for caring for the uninsured has recently been estimated to cost nearly $1.1 billion.
As the Legislature considers a major overhaul of our health care system, it should address the unfair situation that is facing the small business community in Massachusetts. Thankfully, the solution is within arm's length.
Some states, including California, Connecticut, and Washington, have successfully established purchasing pools to help small businesses provide health insurance to workers.
These purchasing pools are Association Health Plans. By permitting small firms to join such a plan, the Legislature would help close the huge gap in premiums between small businesses and large companies making insurance more affordable and thus expanding health care coverage.
A recent study released by the Beacon Hill Institute found that Massachusetts could reduce the number of uninsured people by almost 25,000 and result in more than 4,000 firms offering insurance to their employees. The report also showed this would net the state close to $50 million in savings by pulling folks out of the free care pool.
Associate Health Plans once existed in Massachusetts, but faded because there were too many of them. To deal with that issue, we're supporting a proposal before the Legislature that would create a single, centrally administered purchasing pool that would negotiate premiums and would administer plans for all participating small businesses.
Under this approach, small businesses would see a variety of benefits -- lower premiums, more options of insurance plans to choose from, increased price stability year-after-year and increased productivity from a healthier, happier workforce. Estimates for increased productivity range from $44.4 million to $88.6 million.
Opponents of this initiative argue that only healthy employers with young healthy workforces would be allowed membership in an association and allowed to purchase health insurance under this new group. That assertion is false.
This practice of so-called ''cherry picking" is strictly prohibited within the proposed bill. Additionally, small business is not a divided collection of healthy and unhealthy companies, but rather it is a reflection of everyday society, employing people of all ages, types and sizes, not to mention health status.
Small business owners deserve a level playing field when it comes to getting the best rate on health insurance for their employees. Association Health Plans would simply lift the current restrictions that prevent small businesses from creating negotiating pools. Associate Health Plans are not only good for business in Massachusetts, they're also a real solution to help take care of workers.
A BURNING question for Massachusetts lawmakers as they ponder major health reform legislation: Why do health insurance companies in Massachusetts that reimburse hospitals the same rate for the same service charge a small business person $2,000 more per year for health insurance than an employee of a large corporation?
The answer is simple -- because they can. There is no competition and no regulation to prevent this price inflation from happening. In Massachusetts, large companies negotiate with insurers for a competitive rate for their employees as a group. But for small business people, state law prohibits them from joining together to do the same. The result is that small business owners are left to choose between paying inflated annual premiums or going without health insurance.
Given the situation, it is not surprising that small business owners in Massachusetts face an acute and growing problem -- providing reasonably priced health insurance to their employees. Today, approximately 460,000 Massachusetts residents are without health insurance and small business employees comprise nearly 60 percent of all uninsured workers in the Commonwealth.
This discriminatory policy not only hurts small business owners, it hurts everyone; the annual cost for caring for the uninsured has recently been estimated to cost nearly $1.1 billion.
As the Legislature considers a major overhaul of our health care system, it should address the unfair situation that is facing the small business community in Massachusetts. Thankfully, the solution is within arm's length.
Some states, including California, Connecticut, and Washington, have successfully established purchasing pools to help small businesses provide health insurance to workers.
These purchasing pools are Association Health Plans. By permitting small firms to join such a plan, the Legislature would help close the huge gap in premiums between small businesses and large companies making insurance more affordable and thus expanding health care coverage.
A recent study released by the Beacon Hill Institute found that Massachusetts could reduce the number of uninsured people by almost 25,000 and result in more than 4,000 firms offering insurance to their employees. The report also showed this would net the state close to $50 million in savings by pulling folks out of the free care pool.
Associate Health Plans once existed in Massachusetts, but faded because there were too many of them. To deal with that issue, we're supporting a proposal before the Legislature that would create a single, centrally administered purchasing pool that would negotiate premiums and would administer plans for all participating small businesses.
Under this approach, small businesses would see a variety of benefits -- lower premiums, more options of insurance plans to choose from, increased price stability year-after-year and increased productivity from a healthier, happier workforce. Estimates for increased productivity range from $44.4 million to $88.6 million.
Opponents of this initiative argue that only healthy employers with young healthy workforces would be allowed membership in an association and allowed to purchase health insurance under this new group. That assertion is false.
This practice of so-called ''cherry picking" is strictly prohibited within the proposed bill. Additionally, small business is not a divided collection of healthy and unhealthy companies, but rather it is a reflection of everyday society, employing people of all ages, types and sizes, not to mention health status.
Small business owners deserve a level playing field when it comes to getting the best rate on health insurance for their employees. Association Health Plans would simply lift the current restrictions that prevent small businesses from creating negotiating pools. Associate Health Plans are not only good for business in Massachusetts, they're also a real solution to help take care of workers.
Friday, July 29, 2005
Medicare Advantage plans
Insurance Commissioner Jim Long wants senior citizens to be aware of the aggressive marketing of Medicare Advantage plans by insurance companies, and for seniors to be aware of what is legal and what resources they can turn to for advice.
Some seniors are allegedly being advised to make decisions that may not be in their best financial interest, he warns.
This warning comes after the Department of Insurance’s Seniors’ Health Insurance Information Program (SHIIP) received a surge in calls from senior citizens, their family members and government agencies worried about the advice being given by companies offering Medicare Advantage products.
Recent Medicare reform laws have allowed more companies to sell these products, which are HMO, PPO or private-fee-for-service products. The influx of companies into North Carolina — and, more significantly, the surge in aggressive marketing of these products — has created many questions for Medicare recipients and those who care for them.
Complaints about these aggressive marketing tactics range from insurance agents soliciting seniors at discount stores to “cold calls” by agents wishing to set up appointments in seniors’ homes to pitch the product.
The complaints have included incidents of agents advising the seniors’ on financial decisions, such as canceling other insurance policies, which may not have been in the best interest of the client.
While this type of marketing is not illegal, Long and the staff at SHIIP are extremely concerned that this type of solicitation may lead seniors to make poor decisions that could affect their insurance coverage negatively.
Things that Medicare recipients should know about Medicare Advantage (also known as Medicare Health) plans:
Medicare Advantage products are not Medicare supplement or Medigap plans. Medicare Advantage products are part of the Medicare program and will provide Medicare-covered benefits under Part A (hospital insurance) and Part B (medical insurance for doctor visits and other outpatient services) and sometimes extra benefits.
There may be a monthly premium in addition to the Medicare Part B premium. The Medicare Advantage carrier will provide a health card that can be used at doctors’ offices, hospitals, etc. in place of your Medicare card.
Representatives from companies offering Medicare Advantage plans can call you to schedule an appointment, but they cannot come to your home without your permission.
Before agreeing to an appointment, get the person’s name, the name of the company he or she represents and a phone number. Call the person back at that phone number in order to verify that he is who he says he is. Then make the appointment.
If you have any doubts, call SHIIP toll-free at (800) 443-9354.
Make sure your doctors and/or hospitals or other medical providers accept the Medicare Advantage plan before you purchase it.
If you buy a policy with a certain company and then your regular doctor does not accept insurance from that company, you have wasted your money and will have to pay all charges out of pocket.
You might have out-of-pocket costs, such as co-payments for office visits, associated with the Medicare Advantage plan. Be sure you fully understand the terms before you sign up.
Some other health-insurance plans, such as your employer plan that you have through retiree coverage, might not coordinate with the Medicare Advantage plan. Though a Medicare Advantage plan may cost less, it does not offer the same benefits.
Do not be pressured into making quick decisions. This is a serious decision that should be considered carefully. Discuss it with a trusted family member or financial adviser before signing anything, or contact SHIIP for free counseling or to arrange for a counselor to visit with you in your hometown.
SHIIP counselors are specifically trained to assist you with your health insurance questions.
“Above all, trust your instincts,” Long said. “If it seems too good to be true, it usually is. Don’t give in to high pressure tactics, and don’t hesitate to call SHIIP with any questions you may have.
“We’re considered the model seniors’ health insurance information program in the nation, and we’re here to help.”
Some seniors are allegedly being advised to make decisions that may not be in their best financial interest, he warns.
This warning comes after the Department of Insurance’s Seniors’ Health Insurance Information Program (SHIIP) received a surge in calls from senior citizens, their family members and government agencies worried about the advice being given by companies offering Medicare Advantage products.
Recent Medicare reform laws have allowed more companies to sell these products, which are HMO, PPO or private-fee-for-service products. The influx of companies into North Carolina — and, more significantly, the surge in aggressive marketing of these products — has created many questions for Medicare recipients and those who care for them.
Complaints about these aggressive marketing tactics range from insurance agents soliciting seniors at discount stores to “cold calls” by agents wishing to set up appointments in seniors’ homes to pitch the product.
The complaints have included incidents of agents advising the seniors’ on financial decisions, such as canceling other insurance policies, which may not have been in the best interest of the client.
While this type of marketing is not illegal, Long and the staff at SHIIP are extremely concerned that this type of solicitation may lead seniors to make poor decisions that could affect their insurance coverage negatively.
Things that Medicare recipients should know about Medicare Advantage (also known as Medicare Health) plans:
Medicare Advantage products are not Medicare supplement or Medigap plans. Medicare Advantage products are part of the Medicare program and will provide Medicare-covered benefits under Part A (hospital insurance) and Part B (medical insurance for doctor visits and other outpatient services) and sometimes extra benefits.
There may be a monthly premium in addition to the Medicare Part B premium. The Medicare Advantage carrier will provide a health card that can be used at doctors’ offices, hospitals, etc. in place of your Medicare card.
Representatives from companies offering Medicare Advantage plans can call you to schedule an appointment, but they cannot come to your home without your permission.
Before agreeing to an appointment, get the person’s name, the name of the company he or she represents and a phone number. Call the person back at that phone number in order to verify that he is who he says he is. Then make the appointment.
If you have any doubts, call SHIIP toll-free at (800) 443-9354.
Make sure your doctors and/or hospitals or other medical providers accept the Medicare Advantage plan before you purchase it.
If you buy a policy with a certain company and then your regular doctor does not accept insurance from that company, you have wasted your money and will have to pay all charges out of pocket.
You might have out-of-pocket costs, such as co-payments for office visits, associated with the Medicare Advantage plan. Be sure you fully understand the terms before you sign up.
Some other health-insurance plans, such as your employer plan that you have through retiree coverage, might not coordinate with the Medicare Advantage plan. Though a Medicare Advantage plan may cost less, it does not offer the same benefits.
Do not be pressured into making quick decisions. This is a serious decision that should be considered carefully. Discuss it with a trusted family member or financial adviser before signing anything, or contact SHIIP for free counseling or to arrange for a counselor to visit with you in your hometown.
SHIIP counselors are specifically trained to assist you with your health insurance questions.
“Above all, trust your instincts,” Long said. “If it seems too good to be true, it usually is. Don’t give in to high pressure tactics, and don’t hesitate to call SHIIP with any questions you may have.
“We’re considered the model seniors’ health insurance information program in the nation, and we’re here to help.”
Queens Man Nabbed For Selling Fake Auto Insurance Policies
A Queens man has been charged in an alleged fraudulent automobile insurance scheme in which he allegedly solicited motorists at a Queens gas station and sold fraudulent auto insurance cards and registrations to individuals with suspended registrations or cancelled insurance policies.
Willie Fulmore Jr., 59, of South Ozone Park, a former licensed New York State insurance broker, solicited motorists and sold fraudulent insurance policies from his brokerage firm when his license had been revoked for having sold fake automobile insurance.
Fulmore has been charged with 71 counts of forgery in the second degree and criminal possession of a forged instrument in the second degree, criminal possession of forgery devices, scheme to defraud in the first degree, attempted offering of a false Instrument in the fifth degree, insurance fraud in the fifth degree, possession of stolen property in the fifth degree and violating New York State Insurance Law. He faces up to seven years in prison if convicted.
According to the criminal charges between May 6 nd May 24, Fulmore was posing and conducting business as a licensed auto insurance broker at his business, Feel Welcome Brokerage, at 111-06 Van Wyck Expressway -- a small private office between a repair shop and cashier’s window of a gasoline station -- and his home at 105-56 130th Street in South Ozone Park in spite of the fact that his insurance brokerage license had been revoked by the New York State Department of Insurance in July 1998 for selling fake insurance. It is alleged that the defendant was soliciting motorists at gas pumps at the gas station by handing out Feel Welcome Brokerage brochures that said “No Matter How Many Points We Insure All,” “Cancelled Policies Replaced” and “Immediate ID Cards.” According to investigators, at least several of the defendant’s customers had suspended registrations or insurance policies.
According to the criminal complaint, it is additionally alleged that the defendant sold a fraudulent auto insurance policy to an individual he believed was seeking auto insurance but was actually an NYPD undercover investigator and in exchange for $500 in cash gave the undercover a fraudulent Interboro Mutual Indemnity Insurance card. According to the New York State Insurance Frauds Department, Interboro Mutual Indemnity Insurance was placed into court-ordered rehabilitation in April 2004 and since then, has continued to renew existing policies which were in force prior to that date, but has not written any new business.
The case was referred to Queens district attorney’s by the New York State Insurance Frauds Department after it was referred to them by the New York State Department of Motor Vehicles Driver Program Regulation Oversight Bureau. The undercover operation was put into place after the case was referred to the district attorney’s office.
According to the district attorney’s office, detectives of the NYPD’s Auto Crime Division executed a court-authorized search warrant on May 24 at the defendant’s residence and recovered fraudulent New York temporary certificates of registration, one fraudulent New York State Veteran’s License to Hawk, Peddle and Vend Merchant license, fraudulent New York State inspection and registration stickers, 61 fraudulent North Carolina Department of Motor Vehicle temporary 30-day temporary licenses (known as tags), fraudulent US Military identification cards, fraudulent Interboro Mutual Indemnity Insurance Company insurance cards and computers and disks with templates to create the fraudulent documents.
Additionally, recovered were altered NYPD forms which relate to motor vehicles, and a pad of DMV forms which are issued by NYPD police precincts. When the defendant was apprehended shortly after he was in possession of a badge indicating that he was a “U.S. Fugitive Recovery Agent,” commonly known as a bounty hunter.
The defendant was apprehended shortly after detectives executed the search warrant at his residence. He was arraigned on the charges before Judge Robert Raciti who set $25,000 bond and $15,000 cash bail.
Willie Fulmore Jr., 59, of South Ozone Park, a former licensed New York State insurance broker, solicited motorists and sold fraudulent insurance policies from his brokerage firm when his license had been revoked for having sold fake automobile insurance.
Fulmore has been charged with 71 counts of forgery in the second degree and criminal possession of a forged instrument in the second degree, criminal possession of forgery devices, scheme to defraud in the first degree, attempted offering of a false Instrument in the fifth degree, insurance fraud in the fifth degree, possession of stolen property in the fifth degree and violating New York State Insurance Law. He faces up to seven years in prison if convicted.
According to the criminal charges between May 6 nd May 24, Fulmore was posing and conducting business as a licensed auto insurance broker at his business, Feel Welcome Brokerage, at 111-06 Van Wyck Expressway -- a small private office between a repair shop and cashier’s window of a gasoline station -- and his home at 105-56 130th Street in South Ozone Park in spite of the fact that his insurance brokerage license had been revoked by the New York State Department of Insurance in July 1998 for selling fake insurance. It is alleged that the defendant was soliciting motorists at gas pumps at the gas station by handing out Feel Welcome Brokerage brochures that said “No Matter How Many Points We Insure All,” “Cancelled Policies Replaced” and “Immediate ID Cards.” According to investigators, at least several of the defendant’s customers had suspended registrations or insurance policies.
According to the criminal complaint, it is additionally alleged that the defendant sold a fraudulent auto insurance policy to an individual he believed was seeking auto insurance but was actually an NYPD undercover investigator and in exchange for $500 in cash gave the undercover a fraudulent Interboro Mutual Indemnity Insurance card. According to the New York State Insurance Frauds Department, Interboro Mutual Indemnity Insurance was placed into court-ordered rehabilitation in April 2004 and since then, has continued to renew existing policies which were in force prior to that date, but has not written any new business.
The case was referred to Queens district attorney’s by the New York State Insurance Frauds Department after it was referred to them by the New York State Department of Motor Vehicles Driver Program Regulation Oversight Bureau. The undercover operation was put into place after the case was referred to the district attorney’s office.
According to the district attorney’s office, detectives of the NYPD’s Auto Crime Division executed a court-authorized search warrant on May 24 at the defendant’s residence and recovered fraudulent New York temporary certificates of registration, one fraudulent New York State Veteran’s License to Hawk, Peddle and Vend Merchant license, fraudulent New York State inspection and registration stickers, 61 fraudulent North Carolina Department of Motor Vehicle temporary 30-day temporary licenses (known as tags), fraudulent US Military identification cards, fraudulent Interboro Mutual Indemnity Insurance Company insurance cards and computers and disks with templates to create the fraudulent documents.
Additionally, recovered were altered NYPD forms which relate to motor vehicles, and a pad of DMV forms which are issued by NYPD police precincts. When the defendant was apprehended shortly after he was in possession of a badge indicating that he was a “U.S. Fugitive Recovery Agent,” commonly known as a bounty hunter.
The defendant was apprehended shortly after detectives executed the search warrant at his residence. He was arraigned on the charges before Judge Robert Raciti who set $25,000 bond and $15,000 cash bail.
Compare Auto Insurance? Not in Massachusetts
You don't have to look further than your television set to realize how little choice Massachusetts consumers have for auto insurance. During a Red Sox/Yankees game earlier this season, the ads made it all very clear within the first few innings. If you want to find out how to save $200, the "gecko" can't help you in this state, and neither can so many other insurers that won't come here.
Most of the ads we see are actually national marketing campaigns, because insurers compete quite aggressively for consumers in 49 other states. Here, most of our 18 insurers don't actively pursue us. They don't need to. They know a fair amount of us will end up with them anyway. Recently, another small auto insurer announced it was leaving Massachusetts, yet another victim of our system's failings. Twenty-two thousand drivers will be forced to switch insurers next year. This has happened to hundreds of thousands of drivers in our state in recent years ...and that sure wasn't their choice! In the last year and a half, almost 30,000 consumers have also lost choice in their home insurer. This frustration may have been averted if Massachusetts didn't have an auto insurance system that repels national insurers, which offer a full menu of insurance products.
Most of the ads we see are actually national marketing campaigns, because insurers compete quite aggressively for consumers in 49 other states. Here, most of our 18 insurers don't actively pursue us. They don't need to. They know a fair amount of us will end up with them anyway. Recently, another small auto insurer announced it was leaving Massachusetts, yet another victim of our system's failings. Twenty-two thousand drivers will be forced to switch insurers next year. This has happened to hundreds of thousands of drivers in our state in recent years ...and that sure wasn't their choice! In the last year and a half, almost 30,000 consumers have also lost choice in their home insurer. This frustration may have been averted if Massachusetts didn't have an auto insurance system that repels national insurers, which offer a full menu of insurance products.
Best insurance is what you can afford
When you go to the grocery store, nobody makes you fill your cart with specific food items, including ones you don't really want and perhaps can't afford.
When you buy a computer, the government doesn't compel you to load it with dozens of extra software programs you can't use.
But when individuals and small businesses buy health insurance, the state of Montana insists that they buy policies that include coverage for 35 services or procedures, ranging from podiatry to drug abuse treatment to dentures. There's absolutely nothing wrong with buying insurance for any of these services or others, but there is something wrong with the state Legislature or Congress forcing you to do so.
Mandated coverage costs money. The Montana Auditor's Office cites figures provided by Blue Cross Blue Shield estimating those 35 state mandates cost just $15.50 per month extra. Really? The actuarial firm Milliman & Robertson did a study in 1997 for the National Center for Policy Analysis and found the 12 most common coverage mandates imposed by states jack up the cost of insurance by
30 percent.
Whatever the amount, it's something we should have second thoughts about in an era when 44 million Americans can't afford health insurance.
What got us thinking about this was an editorial in Monday's Wall Street Journal endorsing a bill in Congress to allow people who buy health insurance on the open market to shop around the 50 states for the best deal. The bill, introduced by Arizona Republican Rep. John Shadegg, would allow people to buy the insurance they want and can afford, not what their states mandate. The Journal cites figures provided by eHealthInsurance.com showing that a typical policy for a family of four costs as little as $172 a month in Missouri but can cost as much as $840 a month in New York or $1,200 a month in New Jersey.
State Auditor John Morrison says Shadegg's bill is a terrible piece of legislation - that it would allow an insurance company licensed in one state to do business nationwide without licensing in other states. He says the bill is part of a move by some Republicans to deregulate insurance and that doing so would be a disaster for consumers. Maybe. But would the results really be worse for consumers? How could it be worse for the 44 million who can't now afford health insurance? The policies in question are ones bought by individuals and small employers - large employers who provide insurance aren't affected. It's sort of like arguing what's best for motorists is driving Cadillacs. It may be true. But what's also true is that most people can't afford them.
Shadegg's bill wouldn't prohibit states from mandating coverage. It simply would free consumers to shop around. The standard argument for coverage mandates is that they're needed to protect consumers. But what they really do is provide a guaranteed revenue stream for providers. Legislators may take credit for giving something to the consumers for nothing when they are really giving something to the providers for nothing. A win-win for the legislators, but not necessarily a good bargain for the consumers. We can't say that Shaddeg's bill is the perfect approach, but we can say the matter of mandated coverage is worth greater scrutiny.
And the one thing we know for sure is that the most comprehensive insurance policy in the world isn't much good if you can't afford it.
When you buy a computer, the government doesn't compel you to load it with dozens of extra software programs you can't use.
But when individuals and small businesses buy health insurance, the state of Montana insists that they buy policies that include coverage for 35 services or procedures, ranging from podiatry to drug abuse treatment to dentures. There's absolutely nothing wrong with buying insurance for any of these services or others, but there is something wrong with the state Legislature or Congress forcing you to do so.
Mandated coverage costs money. The Montana Auditor's Office cites figures provided by Blue Cross Blue Shield estimating those 35 state mandates cost just $15.50 per month extra. Really? The actuarial firm Milliman & Robertson did a study in 1997 for the National Center for Policy Analysis and found the 12 most common coverage mandates imposed by states jack up the cost of insurance by
30 percent.
Whatever the amount, it's something we should have second thoughts about in an era when 44 million Americans can't afford health insurance.
What got us thinking about this was an editorial in Monday's Wall Street Journal endorsing a bill in Congress to allow people who buy health insurance on the open market to shop around the 50 states for the best deal. The bill, introduced by Arizona Republican Rep. John Shadegg, would allow people to buy the insurance they want and can afford, not what their states mandate. The Journal cites figures provided by eHealthInsurance.com showing that a typical policy for a family of four costs as little as $172 a month in Missouri but can cost as much as $840 a month in New York or $1,200 a month in New Jersey.
State Auditor John Morrison says Shadegg's bill is a terrible piece of legislation - that it would allow an insurance company licensed in one state to do business nationwide without licensing in other states. He says the bill is part of a move by some Republicans to deregulate insurance and that doing so would be a disaster for consumers. Maybe. But would the results really be worse for consumers? How could it be worse for the 44 million who can't now afford health insurance? The policies in question are ones bought by individuals and small employers - large employers who provide insurance aren't affected. It's sort of like arguing what's best for motorists is driving Cadillacs. It may be true. But what's also true is that most people can't afford them.
Shadegg's bill wouldn't prohibit states from mandating coverage. It simply would free consumers to shop around. The standard argument for coverage mandates is that they're needed to protect consumers. But what they really do is provide a guaranteed revenue stream for providers. Legislators may take credit for giving something to the consumers for nothing when they are really giving something to the providers for nothing. A win-win for the legislators, but not necessarily a good bargain for the consumers. We can't say that Shaddeg's bill is the perfect approach, but we can say the matter of mandated coverage is worth greater scrutiny.
And the one thing we know for sure is that the most comprehensive insurance policy in the world isn't much good if you can't afford it.
Thursday, July 28, 2005
1 in 7 NC residents don't have health insurance
Sarah Rabil
Staff Writer
Thursday, July 28, 2005
Job layoffs and industry relocations in recent years have made it harder for area residents to afford health insurance. In Rockingham County about one in seven don't have any form of health care coverage.
Families who can afford health insurance could see their premiums jump in the coming years.
According to a new study released by the health consumer organization, Families USA, families with health insurance through private employers may face premiums that are $922 higher in 2005 to reimburse the costs of health care for the uninsured. By 2010, the extra premium costs are projected to inflate to $1,502.
Sandra Kueider, emergency room director for Annie Penn Hospital, said she has witnessed a growing number of uninsured residents who use the emergency room as a primary care facility. By law, hospital emergency rooms cannot turn away the uninsured.
"We always treat every patient that comes to our emergency room," said Sharon Troxler, spokeswoman for Annie Penn Hospital. "(But) we're not required to admit the patient and perform elective surgery."
Kueider said the growing volume of uninsured patients translates to a more crowded emergency room with fewer beds available. About 10.3 percent of Annie Penn's patients are self-paid, meaning they do not have insurance and do not qualify for Medicare or Medicaid, Troxler said.
Annie Penn is part of the Moses Cone Health System, and about 5 percent of patients treated in the system lack health insurance, said Doug Allred, public relations specialist for Moses Cone Health System.
The Families USA report stated that about one-third of health care costs incurred by the uninsured are paid by the uninsured themselves. The remaining costs are deemed "uncompensated care."
In 2004 the Moses Cone system racked up $58.3 million in uncompensated care, which includes costs for the uninsured, patients who could not pay their bill in full and shortfalls in Medicare and Medicaid.
Locally, residents have felt the effect of rising health care costs coupled with high jobless rates, which directly affect hospitals' uncompensated care costs. Rockingham County's unemployment rate was 6.4 percent in May, down from a staggering 11.2 percent in July 2003.
The number of uninsured North Carolinians is expected to increase by about 140,000 to total more than 1.4 million uninsured residents in 2010, according to the Families USA report.
Households in Rockingham, Davie, Stokes, Surry and Yadkin counties reported higher premiums and out-of-pocket health care costs than the rest of the state, according to a 2004 survey conducted by the North Carolina State Center for Health Statistics.
More than 20 percent of those surveyed said they had given up a portion of their living expenses in the last year to pay health care costs. Of those surveyed in the five counties, about 23 percent reported foregoing health care in the last year because of the cost, compared to 16 percent of state residents not seeing a doctor due to cost.
The survey results also showed that locally a larger percentage of residents under age 65 do not have health insurance - 18.3 percent compared to 16.1 percent statewide.
For now, local hospitals are working around the clock to keep pace with the volume of patients - both insured and uninsured - flooding emergency departments.
Annie Penn Hospital is planning to more than double the size of its emergency department in the coming months in a phased project that will cost in the millions of dollars.
Staff Writer
Thursday, July 28, 2005
Job layoffs and industry relocations in recent years have made it harder for area residents to afford health insurance. In Rockingham County about one in seven don't have any form of health care coverage.
Families who can afford health insurance could see their premiums jump in the coming years.
According to a new study released by the health consumer organization, Families USA, families with health insurance through private employers may face premiums that are $922 higher in 2005 to reimburse the costs of health care for the uninsured. By 2010, the extra premium costs are projected to inflate to $1,502.
Sandra Kueider, emergency room director for Annie Penn Hospital, said she has witnessed a growing number of uninsured residents who use the emergency room as a primary care facility. By law, hospital emergency rooms cannot turn away the uninsured.
"We always treat every patient that comes to our emergency room," said Sharon Troxler, spokeswoman for Annie Penn Hospital. "(But) we're not required to admit the patient and perform elective surgery."
Kueider said the growing volume of uninsured patients translates to a more crowded emergency room with fewer beds available. About 10.3 percent of Annie Penn's patients are self-paid, meaning they do not have insurance and do not qualify for Medicare or Medicaid, Troxler said.
Annie Penn is part of the Moses Cone Health System, and about 5 percent of patients treated in the system lack health insurance, said Doug Allred, public relations specialist for Moses Cone Health System.
The Families USA report stated that about one-third of health care costs incurred by the uninsured are paid by the uninsured themselves. The remaining costs are deemed "uncompensated care."
In 2004 the Moses Cone system racked up $58.3 million in uncompensated care, which includes costs for the uninsured, patients who could not pay their bill in full and shortfalls in Medicare and Medicaid.
Locally, residents have felt the effect of rising health care costs coupled with high jobless rates, which directly affect hospitals' uncompensated care costs. Rockingham County's unemployment rate was 6.4 percent in May, down from a staggering 11.2 percent in July 2003.
The number of uninsured North Carolinians is expected to increase by about 140,000 to total more than 1.4 million uninsured residents in 2010, according to the Families USA report.
Households in Rockingham, Davie, Stokes, Surry and Yadkin counties reported higher premiums and out-of-pocket health care costs than the rest of the state, according to a 2004 survey conducted by the North Carolina State Center for Health Statistics.
More than 20 percent of those surveyed said they had given up a portion of their living expenses in the last year to pay health care costs. Of those surveyed in the five counties, about 23 percent reported foregoing health care in the last year because of the cost, compared to 16 percent of state residents not seeing a doctor due to cost.
The survey results also showed that locally a larger percentage of residents under age 65 do not have health insurance - 18.3 percent compared to 16.1 percent statewide.
For now, local hospitals are working around the clock to keep pace with the volume of patients - both insured and uninsured - flooding emergency departments.
Annie Penn Hospital is planning to more than double the size of its emergency department in the coming months in a phased project that will cost in the millions of dollars.
Auto Insurance remains bane
It's a bit cheaper on average, but the new tort system isn't meeting Coloradans' basic needs, lawmakers are told.
By Christopher Ortiz
Denver Post Staff Writer
Colorado drivers are paying lower auto-insurance rates because the state abandoned no-fault insurance rules two years ago, but the coverage is not meeting basic needs, according to testimony presented to an interim legislative committee Wednesday.
Colorado Insurance Commissioner David Rivera told the panel of skeptical lawmakers that insurers, on average, lowered their rates by nearly 14 percent in the months after the state eliminated no-fault insurance coverage.
With no-fault insurance, each driver's insurance paid his or her medical claims, regardless of who caused the accident. Now, the driver at fault in an accident is responsible for paying the medical claims of an injured motorist.
That allowed drivers to drop their personal-injury protection. But the new lower-rate policies have inadequate coverage, said Richard W. Laugesen, a lawyer and University of Denver professor.
"Insurers should offer what people need," including immediate payment for medical care, lost wages, rehabilitation, funeral expenses and vehicle damage, Laugesen said.
He said victims of traffic accidents should not have to rely on their health-care coverage as a substitute for inadequate motorist insurance.
"Health care is too expensive already," he said.
Republican and Democratic lawmakers on the panel also were skeptical about how well the new system was working.
Sen. Tom Wiens, R-Castle Rock, said policymakers have no way of knowing whether consumers have saved money because of the switch.
"We're getting a presentation here that shows the average decrease of this and maximum increase of this and all these other decreases as if we have some raging success here, but you're not really giving us anything to compare how the value of the policy has decreased," Wiens told Rivera.
Democratic Rep. Morgan Carroll of Aurora asked Rivera for more information on how the reduced rates correspond to reduced protection for drivers.
And Wiens said he wanted more information about how much more health insurers charge to make up for the decreased coverage offered by auto insurers.
Proponents of the no-fault system warned that health-care costs would increase because auto insurance would no longer cover injuries after accidents in the same way.
Laugesen said his key concerns about the new system involve how slowly injured parties are compensated and the problems that arise when the wreck involves only one vehicle.
Despite the shortfalls, Lauge sen said the new insurance system is fixable.
"I liked the no-fault policy (Colorado had)," he said. "It served us well for 20 years, but we don't need to go back to that."
By Christopher Ortiz
Denver Post Staff Writer
Colorado drivers are paying lower auto-insurance rates because the state abandoned no-fault insurance rules two years ago, but the coverage is not meeting basic needs, according to testimony presented to an interim legislative committee Wednesday.
Colorado Insurance Commissioner David Rivera told the panel of skeptical lawmakers that insurers, on average, lowered their rates by nearly 14 percent in the months after the state eliminated no-fault insurance coverage.
With no-fault insurance, each driver's insurance paid his or her medical claims, regardless of who caused the accident. Now, the driver at fault in an accident is responsible for paying the medical claims of an injured motorist.
That allowed drivers to drop their personal-injury protection. But the new lower-rate policies have inadequate coverage, said Richard W. Laugesen, a lawyer and University of Denver professor.
"Insurers should offer what people need," including immediate payment for medical care, lost wages, rehabilitation, funeral expenses and vehicle damage, Laugesen said.
He said victims of traffic accidents should not have to rely on their health-care coverage as a substitute for inadequate motorist insurance.
"Health care is too expensive already," he said.
Republican and Democratic lawmakers on the panel also were skeptical about how well the new system was working.
Sen. Tom Wiens, R-Castle Rock, said policymakers have no way of knowing whether consumers have saved money because of the switch.
"We're getting a presentation here that shows the average decrease of this and maximum increase of this and all these other decreases as if we have some raging success here, but you're not really giving us anything to compare how the value of the policy has decreased," Wiens told Rivera.
Democratic Rep. Morgan Carroll of Aurora asked Rivera for more information on how the reduced rates correspond to reduced protection for drivers.
And Wiens said he wanted more information about how much more health insurers charge to make up for the decreased coverage offered by auto insurers.
Proponents of the no-fault system warned that health-care costs would increase because auto insurance would no longer cover injuries after accidents in the same way.
Laugesen said his key concerns about the new system involve how slowly injured parties are compensated and the problems that arise when the wreck involves only one vehicle.
Despite the shortfalls, Lauge sen said the new insurance system is fixable.
"I liked the no-fault policy (Colorado had)," he said. "It served us well for 20 years, but we don't need to go back to that."
Insurance gaps harm kids, study says
July 28, 2005
BY ALICIA CHANG
ASSOCIATE PRESS
For every child who lacks health insurance, another has gaps in coverage and is just as likely to miss out on seeing a doctor or getting a prescription refilled, a new study of federal data suggests.
The research also reveals some surprises: About four of five children with insurance coverage gaps have parents who work, two-thirds of them live with both parents, and more than half are white.
The researchers analyzed data from a national health survey in 2000 and 2001. They estimated that almost 7% of children were uninsured, but another 8% lacked coverage for part of the year.
"There is an oversimplified view of what is uninsured," said Lynn Olson of the American Academy of Pediatrics, who led the study.
"We should be measuring who is uninsured in multiple ways in order to understand what the true burden is."
The researchers found that the children with intermittent coverage were more likely to postpone medical care than uninsured kids.
For example, 20% of children who were uninsured for part of the year delayed getting medical attention because parents worried about cost compared to 16% without insurance.
Results appear today in the New England Journal of Medicine. Among the study's findings:
•About 58% of children with coverage gaps were white, while 46% of those with no insurance were Hispanic.
•82% of kids with coverage gaps lived with at least one working parent, and 61% lived with both parents.
•13% of children who were insured only part of the time missed doctor appointments and 10% did not get prescriptions refilled because of the cost -- percentages virtually equal to those for uninsured children.
BY ALICIA CHANG
ASSOCIATE PRESS
For every child who lacks health insurance, another has gaps in coverage and is just as likely to miss out on seeing a doctor or getting a prescription refilled, a new study of federal data suggests.
The research also reveals some surprises: About four of five children with insurance coverage gaps have parents who work, two-thirds of them live with both parents, and more than half are white.
The researchers analyzed data from a national health survey in 2000 and 2001. They estimated that almost 7% of children were uninsured, but another 8% lacked coverage for part of the year.
"There is an oversimplified view of what is uninsured," said Lynn Olson of the American Academy of Pediatrics, who led the study.
"We should be measuring who is uninsured in multiple ways in order to understand what the true burden is."
The researchers found that the children with intermittent coverage were more likely to postpone medical care than uninsured kids.
For example, 20% of children who were uninsured for part of the year delayed getting medical attention because parents worried about cost compared to 16% without insurance.
Results appear today in the New England Journal of Medicine. Among the study's findings:
•About 58% of children with coverage gaps were white, while 46% of those with no insurance were Hispanic.
•82% of kids with coverage gaps lived with at least one working parent, and 61% lived with both parents.
•13% of children who were insured only part of the time missed doctor appointments and 10% did not get prescriptions refilled because of the cost -- percentages virtually equal to those for uninsured children.
Wednesday, July 27, 2005
No Insurance, No Car
Councilman Kevin Wolff has a new name for motorists who drive without car insurance--pedestrians.
The northside councilman is considering introducing an ordinance that would authorize police to tow the vehicles of motorists who are stopped for any reason and turn out not to be carrying a valid car insurance policy, leaving the drivers stranded on the side of the road, 1200 WOAI news reported today. Before the motorists could get their cars back, they would have to pay the towing fee, the fine for violating the state's mandatory insurance law, and prove they have insurance.
"It burns me up every time I hear about drivers causing an accident who doesn't have insurance, because, you know what, I carry insurance," Wolff told 1200 WOAI's Bud Little.
Several north Texas communities, including the Dallas suburbs of Mesquite and Irving, have recently approved similar mandatory towing ordinances.
"In theory, I love the sound of that," Wolff said. "But what I want to look into is the logistics...where we would tow the cars, and how we would store them."
Uninsured motorists cost Texans millions of dollars each year, even though drivers have been required since 1991 to carry insurance.
"We estimate that between twenty and twenty five percent of all drivers do not carry liability insurance," Jerry Johns of the Southwest Insurance Information Institute, an industry trade group, says. "When you get closer to the border with Mexico, that number goes up to fifty percent of more."
A measure recently approved by the legislature would allow police to access insurance records by typing in car license plates, the same way they can currently access criminal records. But many motorists get around the mandatory insurance law by buying policies good for a day or a week, then allowing them to lapse after they have renewed their registrations.
"Under these measures, the car is towed if the car is stopped for a traffic violation or an accident, and they do not have insurance," Johns said.
Wolff said he will look into introducing his measure after he talks with police and other agencies about the potential costs to the city of a mandatory towing policy.
The northside councilman is considering introducing an ordinance that would authorize police to tow the vehicles of motorists who are stopped for any reason and turn out not to be carrying a valid car insurance policy, leaving the drivers stranded on the side of the road, 1200 WOAI news reported today. Before the motorists could get their cars back, they would have to pay the towing fee, the fine for violating the state's mandatory insurance law, and prove they have insurance.
"It burns me up every time I hear about drivers causing an accident who doesn't have insurance, because, you know what, I carry insurance," Wolff told 1200 WOAI's Bud Little.
Several north Texas communities, including the Dallas suburbs of Mesquite and Irving, have recently approved similar mandatory towing ordinances.
"In theory, I love the sound of that," Wolff said. "But what I want to look into is the logistics...where we would tow the cars, and how we would store them."
Uninsured motorists cost Texans millions of dollars each year, even though drivers have been required since 1991 to carry insurance.
"We estimate that between twenty and twenty five percent of all drivers do not carry liability insurance," Jerry Johns of the Southwest Insurance Information Institute, an industry trade group, says. "When you get closer to the border with Mexico, that number goes up to fifty percent of more."
A measure recently approved by the legislature would allow police to access insurance records by typing in car license plates, the same way they can currently access criminal records. But many motorists get around the mandatory insurance law by buying policies good for a day or a week, then allowing them to lapse after they have renewed their registrations.
"Under these measures, the car is towed if the car is stopped for a traffic violation or an accident, and they do not have insurance," Johns said.
Wolff said he will look into introducing his measure after he talks with police and other agencies about the potential costs to the city of a mandatory towing policy.
Lawmakers mull auto, health insurance issues
John Fryar
Daily Record Denver Bureau
DENVER — State legislative panels are to start scrutinizing insurance issues this week.
On Wednesday, one of those committees is to begin a review of Colorado’s auto insurance laws.
On Thursday, a separate committee is to launch its study of the availability and affordability of health insurance.
In mid-2003, Colorado ended a nearly 30-year-old system of “no-fault” auto insurance, in which medical and rehabilitation expenses after an accident were covered by the injured driver’s own insurance company, regardless of who caused the accident.
Colorado switched to a “tort” system of auto insurance, in which the party at fault – or that person’s insur-ance company – is responsible for paying medical and rehabilitation expenses to the injured party. State Insurance Division officials have said that typically, auto insurance companies determine fault in a particu-lar accident, but that in disputed cases court action may be necessary.
Colorado’s change from no-fault to tort-based auto insurance lowered premiums for many motorists, espe-cially if they decided to forgo the personal medical coverage that’s no longer required for such policies.
At least some ambulance companies, hospital emergency rooms, and other health-care providers have complained, however, about late-paid or unpaid bills for treating accident victims who don’t have adequate coverage with other health policies, or victims whose health insurance companies take longer to make those payments.
Earlier this month, the Associated Press reported a coalition of Colorado health care providers said hospi-tals are losing more than $80 million a year in revenue as a result of the 2003 changes to the auto insurance system.
“The elimination of no-fault auto insurance has created gaps in coverage and problems in the delivery and availability of health care for injuries received in auto accidents,” the Legislature declared in its resolution creating the special committee that is to begin meeting Wednesday.
Daily Record Denver Bureau
DENVER — State legislative panels are to start scrutinizing insurance issues this week.
On Wednesday, one of those committees is to begin a review of Colorado’s auto insurance laws.
On Thursday, a separate committee is to launch its study of the availability and affordability of health insurance.
In mid-2003, Colorado ended a nearly 30-year-old system of “no-fault” auto insurance, in which medical and rehabilitation expenses after an accident were covered by the injured driver’s own insurance company, regardless of who caused the accident.
Colorado switched to a “tort” system of auto insurance, in which the party at fault – or that person’s insur-ance company – is responsible for paying medical and rehabilitation expenses to the injured party. State Insurance Division officials have said that typically, auto insurance companies determine fault in a particu-lar accident, but that in disputed cases court action may be necessary.
Colorado’s change from no-fault to tort-based auto insurance lowered premiums for many motorists, espe-cially if they decided to forgo the personal medical coverage that’s no longer required for such policies.
At least some ambulance companies, hospital emergency rooms, and other health-care providers have complained, however, about late-paid or unpaid bills for treating accident victims who don’t have adequate coverage with other health policies, or victims whose health insurance companies take longer to make those payments.
Earlier this month, the Associated Press reported a coalition of Colorado health care providers said hospi-tals are losing more than $80 million a year in revenue as a result of the 2003 changes to the auto insurance system.
“The elimination of no-fault auto insurance has created gaps in coverage and problems in the delivery and availability of health care for injuries received in auto accidents,” the Legislature declared in its resolution creating the special committee that is to begin meeting Wednesday.
1 in 7 Saginaw county residents have no medical insurance
Tuesday, July 26, 2005
SCOTT DAVIS
THE SAGINAW NEWS
For years, the medically uninsured have remained a vague, formless entity -- a mere talking point among politicians.
They now have a number.
Recently released U.S. census figures show that nearly one in seven people lack medical insurance in Saginaw County -- the sixth-highest rate in Michigan.
The statistics show that 29,913 county residents --
14.5 percent of an estimated population of 206,650 -- lack insurance.
Of these, 5,268 are children, or one in 10 of all children countywide.
The census does not provide similar numbers for 1990, so officials cannot say whether the rate of the uninsured has risen or fallen. The recent figures are estimates based largely on the 2000 census.
Saginaw County's rate of 14.5 percent is much higher than the 11.3 percent uninsured statewide, but it's comparable to the nationwide rate of 14.2 percent.
The statistics are of particular interest in Saginaw County, which in recent years has experienced rising numbers of cast-off employees and low-wage workers who officials say can't afford insurance.
"We've been higher than the state because Saginaw has been economically de-pressed," said Randy Barst, executive director of the Saginaw County Department of Human Services, formerly known as the Family Independence Agency.
SCOTT DAVIS
THE SAGINAW NEWS
For years, the medically uninsured have remained a vague, formless entity -- a mere talking point among politicians.
They now have a number.
Recently released U.S. census figures show that nearly one in seven people lack medical insurance in Saginaw County -- the sixth-highest rate in Michigan.
The statistics show that 29,913 county residents --
14.5 percent of an estimated population of 206,650 -- lack insurance.
Of these, 5,268 are children, or one in 10 of all children countywide.
The census does not provide similar numbers for 1990, so officials cannot say whether the rate of the uninsured has risen or fallen. The recent figures are estimates based largely on the 2000 census.
Saginaw County's rate of 14.5 percent is much higher than the 11.3 percent uninsured statewide, but it's comparable to the nationwide rate of 14.2 percent.
The statistics are of particular interest in Saginaw County, which in recent years has experienced rising numbers of cast-off employees and low-wage workers who officials say can't afford insurance.
"We've been higher than the state because Saginaw has been economically de-pressed," said Randy Barst, executive director of the Saginaw County Department of Human Services, formerly known as the Family Independence Agency.
Tuesday, July 26, 2005
Provide Small Businesses With Affordable Health Insurance
WASHINGTON, July 26 /U.S. Newswire/ -- Senator Olympia J. Snowe (R-Maine), chair of the Senate Committee on Small Business and Entrepreneurship and a senior member of the Senate Finance Committee, issued the following statement regarding today's vote in the U.S. House of Representatives on Association Health Plan legislation (H.R. 525):
"Today, the House of Representatives is scheduled to pass for the sixth time legislation that provides small businesses in different states with the freedom to pool their employees together to create health insurance plans. Without Association Health Plans, small businesses will continue to be trapped in markets that prevent their employees from receiving the same benefits offered by large companies.
"The American people have consistently and overwhelmingly told Congress that access to health insurance and the explosive growth in premiums are a major concern. It is a crisis for small businesses and their employees. Unfortunately, here in the Senate there has been no action to confront this worsening national crisis that threatens job creation, economic growth and the ability of small business owners to compete in today's global economy.
"In the interest of basic fairness, as well as the continued health of small business employees and our economy, this dire situation must be addressed. The time for providing relief to the men and women who are the foundation of job creation and sustained economic growth has arrived. The Senate must pass AHP legislation this year so millions of small business owners can provide affordable health insurance choices to our nation’s most indispensable employees."
"Today, the House of Representatives is scheduled to pass for the sixth time legislation that provides small businesses in different states with the freedom to pool their employees together to create health insurance plans. Without Association Health Plans, small businesses will continue to be trapped in markets that prevent their employees from receiving the same benefits offered by large companies.
"The American people have consistently and overwhelmingly told Congress that access to health insurance and the explosive growth in premiums are a major concern. It is a crisis for small businesses and their employees. Unfortunately, here in the Senate there has been no action to confront this worsening national crisis that threatens job creation, economic growth and the ability of small business owners to compete in today's global economy.
"In the interest of basic fairness, as well as the continued health of small business employees and our economy, this dire situation must be addressed. The time for providing relief to the men and women who are the foundation of job creation and sustained economic growth has arrived. The Senate must pass AHP legislation this year so millions of small business owners can provide affordable health insurance choices to our nation’s most indispensable employees."
Scam-heavy health plans may soon be federally regulated
By Andrea Nurko
Palm Beach Post Washington Bureau
Saturday, July 23, 2005
WASHINGTON — Jill Burgess, a small-business owner from Delray Beach, said she never missed a payment to her health insurance company.
But when that company was shut down by the Florida Department of Financial Services in 2003 for operating without a license, she was left with $30,000 in unpaid medical bills from complications during her third pregnancy — even though she'd paid $11,000 in premiums.
"The health insurance scam destroyed our financial well-being," said Burgess, 33, who with her husband filed for bankruptcy and lost their business, a small underground drilling company.
Florida has been among the hardest hit by the latest wave of health insurance fraud that targets the self-employed and small-business owners who buy insurance through memberships in associations.
About 200,000 policyholders were left with $252 million in unpaid bills from various companies nationwide between 2000 and 2002, according to a Government Accountability Office report.
Roughly 30,000 Floridans have been victims of such scams, according to the Coalition Against Insurance Fraud, a group of 1,400 consumer groups, government agencies and insurers.
Until now, association health plans — which help lower costs of insurance premiums by selling to groups of people, including small-business owners and their employees — have been regulated by both state and federal government agencies. But a bill expected to be voted on by the House next week would shift regulation entirely to the federal government. A similar bill has been filed in the Senate.
Researchers from Georgetown University's Health Policy Institute released a report Thursday warning that the bills could leave thousands of Americans vulnerable to scams.
Mila Kofman, author of the report and assistant research professor at the Health Policy Institute, said the bills are a "license to steal" because regulation relies on self-reporting and does not require background checks on people applying for licenses.
Palm Beach Post Washington Bureau
Saturday, July 23, 2005
WASHINGTON — Jill Burgess, a small-business owner from Delray Beach, said she never missed a payment to her health insurance company.
But when that company was shut down by the Florida Department of Financial Services in 2003 for operating without a license, she was left with $30,000 in unpaid medical bills from complications during her third pregnancy — even though she'd paid $11,000 in premiums.
"The health insurance scam destroyed our financial well-being," said Burgess, 33, who with her husband filed for bankruptcy and lost their business, a small underground drilling company.
Florida has been among the hardest hit by the latest wave of health insurance fraud that targets the self-employed and small-business owners who buy insurance through memberships in associations.
About 200,000 policyholders were left with $252 million in unpaid bills from various companies nationwide between 2000 and 2002, according to a Government Accountability Office report.
Roughly 30,000 Floridans have been victims of such scams, according to the Coalition Against Insurance Fraud, a group of 1,400 consumer groups, government agencies and insurers.
Until now, association health plans — which help lower costs of insurance premiums by selling to groups of people, including small-business owners and their employees — have been regulated by both state and federal government agencies. But a bill expected to be voted on by the House next week would shift regulation entirely to the federal government. A similar bill has been filed in the Senate.
Researchers from Georgetown University's Health Policy Institute released a report Thursday warning that the bills could leave thousands of Americans vulnerable to scams.
Mila Kofman, author of the report and assistant research professor at the Health Policy Institute, said the bills are a "license to steal" because regulation relies on self-reporting and does not require background checks on people applying for licenses.
Car Insurance Fraud Ring
July 25, 2005
Two attorneys pleaded guilty Friday in connection with a Southern California insurance fraud ring that allegedly staged vehicle collisions and filed false insurance company claims, officials said.
Curtis Mitchell Shaw, 61, of Beverly Hills and Keith Darran Washington, 41, of Reseda were among 18 people charged in 2003 in connection with the so-called "Operation Rent & Wreck" ring. Most of the other defendants in the case have already entered pleas are serving time or awaiting sentencing.
Prosecutors say between 1993 and 2000, Shaw and Washington's law office served as a clearinghouse for the staged collisions, netting the ring nearly $2.5 million.
Shaw, who has resigned from the state Bar of California, pleaded guilty to one count of conspiracy to commit insurance fraud, three counts of filing false insurance claims and charges of filing false tax returns between 1998 and 2000.
He faces up to three years in state prison when he is sentenced Oct. 18 in Los Angeles Superior Court, Deputy District Attorney Loren Naiman said Friday.
Shaw will also be ordered to pay $1.5 million in restitution, Naiman said.
Washington, who continues to practice law, pleaded guilty to one count of filing fraudulent claims with insurers. He is scheduled to be sentenced Sept. 15 and faces up to a year in county jail. He will be ordered to pay $364,300 in restitution.
Two attorneys pleaded guilty Friday in connection with a Southern California insurance fraud ring that allegedly staged vehicle collisions and filed false insurance company claims, officials said.
Curtis Mitchell Shaw, 61, of Beverly Hills and Keith Darran Washington, 41, of Reseda were among 18 people charged in 2003 in connection with the so-called "Operation Rent & Wreck" ring. Most of the other defendants in the case have already entered pleas are serving time or awaiting sentencing.
Prosecutors say between 1993 and 2000, Shaw and Washington's law office served as a clearinghouse for the staged collisions, netting the ring nearly $2.5 million.
Shaw, who has resigned from the state Bar of California, pleaded guilty to one count of conspiracy to commit insurance fraud, three counts of filing false insurance claims and charges of filing false tax returns between 1998 and 2000.
He faces up to three years in state prison when he is sentenced Oct. 18 in Los Angeles Superior Court, Deputy District Attorney Loren Naiman said Friday.
Shaw will also be ordered to pay $1.5 million in restitution, Naiman said.
Washington, who continues to practice law, pleaded guilty to one count of filing fraudulent claims with insurers. He is scheduled to be sentenced Sept. 15 and faces up to a year in county jail. He will be ordered to pay $364,300 in restitution.
Health insurance coverage unaffordable in N.J.
Published in the Asbury Park Press 07/26/05
BY MERRILL MATTHEWS
In August, my youngest daughter, 22, could join the ranks of the 45 million Americans who do not have health insurance, a victim of state health insurance law.
She will be leaving our home in Texas, where she has always been covered by health insurance, to go to graduate school in New Jersey.
I pay for her coverage now; I would be glad to try and pay for it when she moves. But I'm not sure I can afford it. New Jersey has the highest rates in the country for individuals buying coverage for themselves, rather than through an employer.
An online marketer for health insurance, eHealthInsurance, tracks hundreds of thousands of individuals purchasing coverage around the country and how much they pay in premiums. An individual living in New Jersey buying coverage for himself pays, on average, about $4,080 a year, with neighboring New York running a close second at $3,540.
However, the average annual premium for similar coverage in Iowa is $1,236, the lowest in the country, and $1,284 in Wyoming.
Thus, health insurance is roughly 3.5 times more expensive in New Jersey and New York than in Iowa and Wyoming. Perhaps the difference is due to the higher cost of living in New Jersey. But neighboring Pennsylvania has an average premium of $1,488. Even high-cost California is only $1,680 per year — still less than half that of New Jersey.
No, the primary reason for the higher price is that in 1994 the New Jersey Legislature passed guaranteed-issue legislation. This means anyone can buy a health insurance policy, regardless of how good or bad the individual's health is.
When a state imposes guaranteed issue, the cost of policies escalates for young healthy people, so they drop out of the health insurance pool, leaving it smaller and sicker. Fortunately, there are better and more affordable ways to provide coverage for the "uninsurable," such as high-risk pools, which 33 states have implemented.
How much individuals pay for a policy in New Jersey is a bargain compared to what it costs for a family policy. The lowest price for a family policy (known as "Plan D") with a $500 deductible and a 20 percent co-payment is $3,912 — a month. See the rates at the state's Web site: www.state.nj.us/dobi/acrobat/ihcratepage.pdf.
The point is that in their zeal to protect consumers by imposing coverage mandates and other regulations, some states have made health insurance so costly that the people they intended to protect have been protected right out of coverage, leaving millions of Americans — especially in high-cost states, such as New Jersey, New York and Maine — struggling to find affordable insurance.
If they could buy health insurance coverage that is already available and being sold to people in another state, millions would buy that coverage and leave the ranks of the uninsured. So why don't they? Individuals are prohibited from purchasing individual health insurance policies outside of the state where they reside.
The good news is there is federal legislation that would fix that problem. Rep. John Shadegg, R-Ariz, has introduced the Health Care Choice Act of 2005, which would allow residents of one state to buy a health insurance policy that is being sold to residents of another state.
The insurer selling the policy would still be regulated, but by that state where the policy is being sold rather than the state where the buyer lives. Thus the insurance company isn't escaping state regulation and financial oversight.
Of course, this is the way most other products work. If you buy a food product over the Internet, that product has to conform to the health standards of the state where the product was made, not where you live. The Health Care Choice Act simply creates the same model for health insurance.
If the Health Care Choice Act were law, my daughter moving to New Jersey would have access to health insurance policies available to residents of Pennsylvania, Connecticut, Illinois or several other states. That would open up lots of affordable options.
But if her choices are limited to only those policies available to the residents of New Jersey, there is a very good chance she will join the ranks of the uninsured.
BY MERRILL MATTHEWS
In August, my youngest daughter, 22, could join the ranks of the 45 million Americans who do not have health insurance, a victim of state health insurance law.
She will be leaving our home in Texas, where she has always been covered by health insurance, to go to graduate school in New Jersey.
I pay for her coverage now; I would be glad to try and pay for it when she moves. But I'm not sure I can afford it. New Jersey has the highest rates in the country for individuals buying coverage for themselves, rather than through an employer.
An online marketer for health insurance, eHealthInsurance, tracks hundreds of thousands of individuals purchasing coverage around the country and how much they pay in premiums. An individual living in New Jersey buying coverage for himself pays, on average, about $4,080 a year, with neighboring New York running a close second at $3,540.
However, the average annual premium for similar coverage in Iowa is $1,236, the lowest in the country, and $1,284 in Wyoming.
Thus, health insurance is roughly 3.5 times more expensive in New Jersey and New York than in Iowa and Wyoming. Perhaps the difference is due to the higher cost of living in New Jersey. But neighboring Pennsylvania has an average premium of $1,488. Even high-cost California is only $1,680 per year — still less than half that of New Jersey.
No, the primary reason for the higher price is that in 1994 the New Jersey Legislature passed guaranteed-issue legislation. This means anyone can buy a health insurance policy, regardless of how good or bad the individual's health is.
When a state imposes guaranteed issue, the cost of policies escalates for young healthy people, so they drop out of the health insurance pool, leaving it smaller and sicker. Fortunately, there are better and more affordable ways to provide coverage for the "uninsurable," such as high-risk pools, which 33 states have implemented.
How much individuals pay for a policy in New Jersey is a bargain compared to what it costs for a family policy. The lowest price for a family policy (known as "Plan D") with a $500 deductible and a 20 percent co-payment is $3,912 — a month. See the rates at the state's Web site: www.state.nj.us/dobi/acrobat/ihcratepage.pdf.
The point is that in their zeal to protect consumers by imposing coverage mandates and other regulations, some states have made health insurance so costly that the people they intended to protect have been protected right out of coverage, leaving millions of Americans — especially in high-cost states, such as New Jersey, New York and Maine — struggling to find affordable insurance.
If they could buy health insurance coverage that is already available and being sold to people in another state, millions would buy that coverage and leave the ranks of the uninsured. So why don't they? Individuals are prohibited from purchasing individual health insurance policies outside of the state where they reside.
The good news is there is federal legislation that would fix that problem. Rep. John Shadegg, R-Ariz, has introduced the Health Care Choice Act of 2005, which would allow residents of one state to buy a health insurance policy that is being sold to residents of another state.
The insurer selling the policy would still be regulated, but by that state where the policy is being sold rather than the state where the buyer lives. Thus the insurance company isn't escaping state regulation and financial oversight.
Of course, this is the way most other products work. If you buy a food product over the Internet, that product has to conform to the health standards of the state where the product was made, not where you live. The Health Care Choice Act simply creates the same model for health insurance.
If the Health Care Choice Act were law, my daughter moving to New Jersey would have access to health insurance policies available to residents of Pennsylvania, Connecticut, Illinois or several other states. That would open up lots of affordable options.
But if her choices are limited to only those policies available to the residents of New Jersey, there is a very good chance she will join the ranks of the uninsured.
Monday, July 25, 2005
TDI Announces Small Business Health Insurance Fairs
In an effort to help small business owners get the latest information on health insurance options, the Texas Department of Insurance is sponsoring health insurance fairs in seven cities across the state.
Health insurance carriers will distribute information and applications for health plans specifically designed for small employers (2 to 50 employees).
The locations for these events are as follows:
Houston, Aug. 12, 2005, 8 a.m. to 5:30 p.m.
H.E.S.S. Club, 5430 Westheimer, Houston 77056.
El Paso, Aug. 17, 2005, 8 a.m. to 5:30 p.m.
El Paso Convention Center, One Civic Center Plaza.
Dallas/Fort Worth, Aug. 18, 2005, 8 a.m. to 5:30 p.m.
University of Dallas, Haggar University Center
1845 East Northgate Drive, Irving 75062.
Amarillo, Aug. 19, 2005, 8 a.m. to 5:30 p.m.
La Kiva Hotel and Convention Center
2501 I-40 East, Amarillo.
Laredo, Aug. 24, 2005, 8 a.m. to 5:30 p.m.
Holiday Inn - Civic Center, 800 Garden Street, Laredo.
Harlingen, Aug. 25, 2005, 8 a.m. to 5 p.m.
Harlingen Country Club, 5500 El Camino Real, Harlingen.
Corpus Christi, Aug. 26, 2005, 8 a.m. to 5:30 p.m.
Best Western, 300 N. Shoreline, Corpus Christi.
Texas Department of Insurance staff will distribute information packets to help take some of the guess work out of insurance, and will be available to answer questions throughout the day.
There will be no sales pressure, no fees, and no registration required at these events, TDI said.
TDI will also host a focus group discussion for small business owners at each of these locations. The informal discussions will focus on the insurance needs and problems faced by small business owners. The focus groups will be held from 11:45 a.m. to 1:15 p.m., and participants will receive lunch and be compensated $20. Registration is required to participate in the focus groups.
For more information on these events or to sign up to participate in the small business owner focus group, contact Dianne Longley, project director, at (512) 305-7298 or Dianne.Longley@tdi.state.tx.us, or Stacey Pogue at (512) 322-4322 or Stacey.Pogue@tdi.state.tx.us.
Health insurance carriers will distribute information and applications for health plans specifically designed for small employers (2 to 50 employees).
The locations for these events are as follows:
Houston, Aug. 12, 2005, 8 a.m. to 5:30 p.m.
H.E.S.S. Club, 5430 Westheimer, Houston 77056.
El Paso, Aug. 17, 2005, 8 a.m. to 5:30 p.m.
El Paso Convention Center, One Civic Center Plaza.
Dallas/Fort Worth, Aug. 18, 2005, 8 a.m. to 5:30 p.m.
University of Dallas, Haggar University Center
1845 East Northgate Drive, Irving 75062.
Amarillo, Aug. 19, 2005, 8 a.m. to 5:30 p.m.
La Kiva Hotel and Convention Center
2501 I-40 East, Amarillo.
Laredo, Aug. 24, 2005, 8 a.m. to 5:30 p.m.
Holiday Inn - Civic Center, 800 Garden Street, Laredo.
Harlingen, Aug. 25, 2005, 8 a.m. to 5 p.m.
Harlingen Country Club, 5500 El Camino Real, Harlingen.
Corpus Christi, Aug. 26, 2005, 8 a.m. to 5:30 p.m.
Best Western, 300 N. Shoreline, Corpus Christi.
Texas Department of Insurance staff will distribute information packets to help take some of the guess work out of insurance, and will be available to answer questions throughout the day.
There will be no sales pressure, no fees, and no registration required at these events, TDI said.
TDI will also host a focus group discussion for small business owners at each of these locations. The informal discussions will focus on the insurance needs and problems faced by small business owners. The focus groups will be held from 11:45 a.m. to 1:15 p.m., and participants will receive lunch and be compensated $20. Registration is required to participate in the focus groups.
For more information on these events or to sign up to participate in the small business owner focus group, contact Dianne Longley, project director, at (512) 305-7298 or Dianne.Longley@tdi.state.tx.us, or Stacey Pogue at (512) 322-4322 or Stacey.Pogue@tdi.state.tx.us.
Myths About the Cost of Auto Insurance Persist
July 25, 2005
The color of a car influences how much it costs to insure it, Comprehensive coverage protects drivers in all situations because, after all, it's "comprehensive," and car insurance companies can charge whatever they want.
Turns out lots of people believe one or more of these statements to be true.
A recent online survey of 1,000 drivers conducted by Drive Insurance from Progressive, the largest writer of personal auto, motorcycle, recreational vehicle and boat insurance through independent insurance agencies in the U.S., finds many drivers accept common car insurance myths as true. Here's a sampling of the survey findings along with the facts the insurer say are behind each:
-- Myth: Car insurance companies consider vehicle color when
determining rates.
Survey Says: Twenty-five (25) percent of drivers surveyed
mistakenly believe that the color of their car affects their
auto insurance rate.
Fact: Color is not used to calculate auto insurance rates.
Information that is used includes the vehicle's year, make,
model, body type and engine size, as well as information
about the driver.
-- Myth: Auto insurance rates are not regulated and car insurance
companies can charge whatever they want.
Survey Says: More than half of those surveyed (54 percent)
did not know that each state has a regulatory body that
oversees insurance companies operating within that state.
Fact: Each state has regulators who review the information
companies collect as well as the rates they charge; insurers
cannot deviate from those rates.
-- Myth: Comprehensive coverage protects drivers in all
situations.
Survey Says: Almost half of drivers surveyed (48 percent)
wrongly believe their car insurance policy's Comprehensive
coverage protects them in all situations because, after all,
it's "comprehensive."
Fact: Comprehensive coverage is one type of protection
available on an auto insurance policy (others being Collision,
Uninsured Motorist, etc.). Comprehensive coverage pays only
for damage caused by an event other than a collision, such as
fire, theft, or vandalism; it also covers weather-related
(e.g., hail, flood) damage, damage caused if a vehicle
collides with an animal and it provides a rental car if a
vehicle is stolen.
-- Myth: Rental reimbursement coverage protects drivers who crash
their rental car while on vacation.
Survey Says: One out of three drivers surveyed (33 percent)
did not know what protection is provided through rental
reimbursement coverage.
Fact: Rental reimbursement coverage pays for the cost of a
rental car if a driver's personal car is in the shop as a
result of an accident and he or she needs a replacement
vehicle.
-- Myth: Bundling insurance coverages always results in a cheaper
car insurance rate.
Survey Says: The majority of drivers surveyed (51 percent) say
they'll always get a better rate if they "bundle" their
insurance, i.e., buy their car insurance policy from the same
company that insures their home.
Fact: Just because a driver buys more than one product from
the same insurance company doesn't always mean they are
getting the best rate available. In many cases there are
savings to be had by talking with an independent agent or
broker who can create a custom insurance package with
policies from competing insurance carriers.
-- Myth: Car insurance rates go down dramatically when drivers
turn 25.
Survey Says: Sixty (60) percent of those surveyed mistakenly
think rates go down drastically when a driver turns 25.
Fact: Young and older drivers typically have the most car
crashes and different car insurance companies' customers have
different claims experiences. At Drive Insurance, for
example, crash frequency starts to decline when a driver
reaches their mid to late twenties. However, when developing
an auto insurance rate, insurers generally consider a variety
of other information about the driver in addition to their
age, including information about their vehicle, their past
claims history and the claims experience for other customers
like them. One or more of these pieces of information could
lead to a driver getting a higher, lower or the same rate
when they turn 25.
"Car insurance is complicated stuff. Adding to the confusion are the myths floating around out there," says Rick Crawley, product development general manager, Drive Insurance from Progressive. "It's important for drivers to have accurate information so they can make more informed decisions. We hope that by debunking these myths, and by letting people know that independent agents and brokers can help separate fact from fiction, they'll ultimately get the right coverage and services for their needs."
The color of a car influences how much it costs to insure it, Comprehensive coverage protects drivers in all situations because, after all, it's "comprehensive," and car insurance companies can charge whatever they want.
Turns out lots of people believe one or more of these statements to be true.
A recent online survey of 1,000 drivers conducted by Drive Insurance from Progressive, the largest writer of personal auto, motorcycle, recreational vehicle and boat insurance through independent insurance agencies in the U.S., finds many drivers accept common car insurance myths as true. Here's a sampling of the survey findings along with the facts the insurer say are behind each:
-- Myth: Car insurance companies consider vehicle color when
determining rates.
Survey Says: Twenty-five (25) percent of drivers surveyed
mistakenly believe that the color of their car affects their
auto insurance rate.
Fact: Color is not used to calculate auto insurance rates.
Information that is used includes the vehicle's year, make,
model, body type and engine size, as well as information
about the driver.
-- Myth: Auto insurance rates are not regulated and car insurance
companies can charge whatever they want.
Survey Says: More than half of those surveyed (54 percent)
did not know that each state has a regulatory body that
oversees insurance companies operating within that state.
Fact: Each state has regulators who review the information
companies collect as well as the rates they charge; insurers
cannot deviate from those rates.
-- Myth: Comprehensive coverage protects drivers in all
situations.
Survey Says: Almost half of drivers surveyed (48 percent)
wrongly believe their car insurance policy's Comprehensive
coverage protects them in all situations because, after all,
it's "comprehensive."
Fact: Comprehensive coverage is one type of protection
available on an auto insurance policy (others being Collision,
Uninsured Motorist, etc.). Comprehensive coverage pays only
for damage caused by an event other than a collision, such as
fire, theft, or vandalism; it also covers weather-related
(e.g., hail, flood) damage, damage caused if a vehicle
collides with an animal and it provides a rental car if a
vehicle is stolen.
-- Myth: Rental reimbursement coverage protects drivers who crash
their rental car while on vacation.
Survey Says: One out of three drivers surveyed (33 percent)
did not know what protection is provided through rental
reimbursement coverage.
Fact: Rental reimbursement coverage pays for the cost of a
rental car if a driver's personal car is in the shop as a
result of an accident and he or she needs a replacement
vehicle.
-- Myth: Bundling insurance coverages always results in a cheaper
car insurance rate.
Survey Says: The majority of drivers surveyed (51 percent) say
they'll always get a better rate if they "bundle" their
insurance, i.e., buy their car insurance policy from the same
company that insures their home.
Fact: Just because a driver buys more than one product from
the same insurance company doesn't always mean they are
getting the best rate available. In many cases there are
savings to be had by talking with an independent agent or
broker who can create a custom insurance package with
policies from competing insurance carriers.
-- Myth: Car insurance rates go down dramatically when drivers
turn 25.
Survey Says: Sixty (60) percent of those surveyed mistakenly
think rates go down drastically when a driver turns 25.
Fact: Young and older drivers typically have the most car
crashes and different car insurance companies' customers have
different claims experiences. At Drive Insurance, for
example, crash frequency starts to decline when a driver
reaches their mid to late twenties. However, when developing
an auto insurance rate, insurers generally consider a variety
of other information about the driver in addition to their
age, including information about their vehicle, their past
claims history and the claims experience for other customers
like them. One or more of these pieces of information could
lead to a driver getting a higher, lower or the same rate
when they turn 25.
"Car insurance is complicated stuff. Adding to the confusion are the myths floating around out there," says Rick Crawley, product development general manager, Drive Insurance from Progressive. "It's important for drivers to have accurate information so they can make more informed decisions. We hope that by debunking these myths, and by letting people know that independent agents and brokers can help separate fact from fiction, they'll ultimately get the right coverage and services for their needs."
Businesses back health insurance pools
By Erin Moriarty
Atlanta Business Chronicle
Updated: 8:00 p.m. ET July 24, 2005
A handful of Atlanta executives and politicians are leading the charge in Washington to seek relief for small businesses struggling with rising health insurance costs.
The executive director of The Coca-Cola Bottlers' Association in Atlanta is heading up a coalition of 35 groups nationwide that are pushing for proposed legislation that would let small businesses in different states pool together to buy health insurance as a way to boost their buying power.
The bill in the Senate is co-sponsored by Sen. Johnny Isakson, R-Georgia, and the bill in the House of Representatives is co-sponsored by U.S. Rep. Phil Gingrey, R-Georgia.
The proposal involves changing federal laws to allow small businesses to join together through trade associations or other industry groups to form "association health plans." The proposed legislation would exempt the plans from each state's own mandates governing insurance plans -- making it possible for them to sell an insurance plan to small businesses across the nation. The plans would instead be subject to federal regulations.
"When you have one state with two mandates and another with 22, the burden of complying with of all those is huge," said Tom Haynes, executive director of The Coca-Cola Bottlers' Association.
The Coca-Cola Bottlers' Association has been helping its members obtain health insurance for decades and at one point it ran a program that pooled small bottlers together to buy insurance. Haynes said federal legislation allowing association health plans would be a major help to smaller bottlers struggling with health insurance costs that are about $1,500 to $2,000 per employee per year more than what a big company pays.
"That cost alone may represent 20 to 25 percent of a small bottlers' profitability," Haynes said. "We do a lot of things for these [bottlers], but the one thing they want most is to have affordable health insurance. It's probably the most important problem for us to solve."
But the proposal raises serious concerns in the insurance industry.
"If they're exempt from state regulation, there is no way on God's green earth that the federal government can check these organizations for solvency, and that's one of the main functions of state insurance departments," said Kirkland McGhee, executive director of the Georgia Association of Health Plans. "Multiple Employer Welfare Arrangements in the 1980s were like that and they stole money from people ... and companies like Blue Cross Blue Shield and Aetna had to pick up the mess that those people left. I'm afraid AHPs are like the second coming of that."
McGhee, who spent part of his career investigating fraudulent insurers for the state of Georgia, said the proposed federal regulation, which would be implemented through the Department of Labor, would not be as stringent as having state officials watch over plans locally.
"There are a lot of fly-by-nights out there who don't know the insurance business," he said. "It's hard to be in the insurance business, so we should not be letting people who don't have the sophistication of the insurance business get into the business in the name of theoretical savings."
Association health plans have been floated in Washington, D.C., for years -- each time generating controversy -- but some insiders predict the proposed legislation has a better chance to pass this year than ever before. They say the bills, one in the House of Representatives and the Senate, have bipartisan support and are more likely to be a priority since the problem of the nation's uninsured has become more acute.
"I feel that we've got a pretty good chance this year," said Haynes of The Coca-Cola Bottlers' Association.
Rep. Tom Price, R-Georgia, said he hopes Congress will pass the proposed legislation this year.
"Anything we can do that provides greater incentives and opportunities for people to be able to purchase insurance is a step in the right direction," Price said.
The bill passed favorably out of the House Committee on Education and the Workforce in March. The Senate Committee on Health, Education, Labor and Pensions held hearings on it in April, and is expected to vote on it in August or September.
"It has more support in the Senate than it has ever had," Isakson said.
Isakson, who served as president of Northside Realty for 22 years, said his business experience motivated him to push for this legislation in Washington.
"I saw firsthand, for a young or middle-aged person working as an independent contractor in sales, the limited opportunities they had to purchase health insurance," Isakson said. "It's really tough. It's really gotten worse in the past 10 years."
Haynes said his coalition has also been working with the National Federation of Independent Business to support the proposed legislation.
"The price of health insurance would be so much less for small businesses," said Melody Harrison, the federation's Georgia director. "Small businesses could buy it just like all major companies and unions are able to buy it."
While proponents see it as a way to provide more affordable health insurance, insurers say it could actually do just the opposite.
"I think the last thing we need to do is further segment the market," McGhee said. "We certainly don't need to segment it to allow people to do a plan that would let them cherry pick members. That will put the cost of the uninsured more on organizations like hospitals."
Charlie Harman, spokesperson for Blue Cross and Blue Shield of Georgia Inc., said it would upset the balance of healthy and unhealthy that a typical insurance company covers.
"More healthy people who may not see themselves going to the hospitals and needing the state-mandated benefits will select the [associated health plans] and Blue Cross Blue Shield will be left with the less healthy people, who will have higher claims and higher costs," Harman said.
Atlanta Business Chronicle
Updated: 8:00 p.m. ET July 24, 2005
A handful of Atlanta executives and politicians are leading the charge in Washington to seek relief for small businesses struggling with rising health insurance costs.
The executive director of The Coca-Cola Bottlers' Association in Atlanta is heading up a coalition of 35 groups nationwide that are pushing for proposed legislation that would let small businesses in different states pool together to buy health insurance as a way to boost their buying power.
The bill in the Senate is co-sponsored by Sen. Johnny Isakson, R-Georgia, and the bill in the House of Representatives is co-sponsored by U.S. Rep. Phil Gingrey, R-Georgia.
The proposal involves changing federal laws to allow small businesses to join together through trade associations or other industry groups to form "association health plans." The proposed legislation would exempt the plans from each state's own mandates governing insurance plans -- making it possible for them to sell an insurance plan to small businesses across the nation. The plans would instead be subject to federal regulations.
"When you have one state with two mandates and another with 22, the burden of complying with of all those is huge," said Tom Haynes, executive director of The Coca-Cola Bottlers' Association.
The Coca-Cola Bottlers' Association has been helping its members obtain health insurance for decades and at one point it ran a program that pooled small bottlers together to buy insurance. Haynes said federal legislation allowing association health plans would be a major help to smaller bottlers struggling with health insurance costs that are about $1,500 to $2,000 per employee per year more than what a big company pays.
"That cost alone may represent 20 to 25 percent of a small bottlers' profitability," Haynes said. "We do a lot of things for these [bottlers], but the one thing they want most is to have affordable health insurance. It's probably the most important problem for us to solve."
But the proposal raises serious concerns in the insurance industry.
"If they're exempt from state regulation, there is no way on God's green earth that the federal government can check these organizations for solvency, and that's one of the main functions of state insurance departments," said Kirkland McGhee, executive director of the Georgia Association of Health Plans. "Multiple Employer Welfare Arrangements in the 1980s were like that and they stole money from people ... and companies like Blue Cross Blue Shield and Aetna had to pick up the mess that those people left. I'm afraid AHPs are like the second coming of that."
McGhee, who spent part of his career investigating fraudulent insurers for the state of Georgia, said the proposed federal regulation, which would be implemented through the Department of Labor, would not be as stringent as having state officials watch over plans locally.
"There are a lot of fly-by-nights out there who don't know the insurance business," he said. "It's hard to be in the insurance business, so we should not be letting people who don't have the sophistication of the insurance business get into the business in the name of theoretical savings."
Association health plans have been floated in Washington, D.C., for years -- each time generating controversy -- but some insiders predict the proposed legislation has a better chance to pass this year than ever before. They say the bills, one in the House of Representatives and the Senate, have bipartisan support and are more likely to be a priority since the problem of the nation's uninsured has become more acute.
"I feel that we've got a pretty good chance this year," said Haynes of The Coca-Cola Bottlers' Association.
Rep. Tom Price, R-Georgia, said he hopes Congress will pass the proposed legislation this year.
"Anything we can do that provides greater incentives and opportunities for people to be able to purchase insurance is a step in the right direction," Price said.
The bill passed favorably out of the House Committee on Education and the Workforce in March. The Senate Committee on Health, Education, Labor and Pensions held hearings on it in April, and is expected to vote on it in August or September.
"It has more support in the Senate than it has ever had," Isakson said.
Isakson, who served as president of Northside Realty for 22 years, said his business experience motivated him to push for this legislation in Washington.
"I saw firsthand, for a young or middle-aged person working as an independent contractor in sales, the limited opportunities they had to purchase health insurance," Isakson said. "It's really tough. It's really gotten worse in the past 10 years."
Haynes said his coalition has also been working with the National Federation of Independent Business to support the proposed legislation.
"The price of health insurance would be so much less for small businesses," said Melody Harrison, the federation's Georgia director. "Small businesses could buy it just like all major companies and unions are able to buy it."
While proponents see it as a way to provide more affordable health insurance, insurers say it could actually do just the opposite.
"I think the last thing we need to do is further segment the market," McGhee said. "We certainly don't need to segment it to allow people to do a plan that would let them cherry pick members. That will put the cost of the uninsured more on organizations like hospitals."
Charlie Harman, spokesperson for Blue Cross and Blue Shield of Georgia Inc., said it would upset the balance of healthy and unhealthy that a typical insurance company covers.
"More healthy people who may not see themselves going to the hospitals and needing the state-mandated benefits will select the [associated health plans] and Blue Cross Blue Shield will be left with the less healthy people, who will have higher claims and higher costs," Harman said.
Sunday, July 24, 2005
Insurance Bill Meets Opposition
Jul. 24--Small businesses share a common problem: the ever-escalating cost of health insurance.
But they are divided over a federal proposal intended to lower their costs by giving them some of the advantages enjoyed by large corporations and labor unions.
The federal proposal involves "association health plans," which would enable small businesses, through national trade associations, to band together across state lines to negotiate lower health insurance rates.
Supporters said the plans, known as "AHPs," would free insurers from state-mandated health benefits that drive up insurance costs, and would create more competition among health insurers.
A U.S. House committee recently approved a bill that would allow multistate AHPs, and a bill has been introduced in the Senate.
But a coalition of opponents, including Pennsylvania Insurance Commissioner M. Diane Koken and several of the state's Blue Cross-Blue Shield plans, are waging a campaign against AHPs.
"My concern is that two-thirds of all small businesses, or more, will be hurt by this," said Cliff Shannon, president of SMC Business Councils, a Pennsylvania organization that provides health insurance coverage for its members.
Shannon has been a leading a voice in the fight for affordable health care, and normally opposes state mandates.
But in this case, he argues that opening the door to insurers that would operate free of state regulations will harm the quality of coverage and undermine the health insurance market in Pennsylvania.
Shannon said the most logical way for AHP plans to lower costs is to form groups of the healthiest people while avoiding older people and those with conditions such as diabetes and cancer, and families with women who might become pregnant.
This practice, called "cherry picking," will increase the concentration of people with the greatest health care needs in the overall insurance pool, driving up costs even more, Shannon said.
That's because an effective health-insurance pool relies on spreading costs across a group that includes an adequate number of healthy people. Increasing the concentration of people with expensive medical needs drives up premiums to the point that healthy members drop coverage or seek it elsewhere. Insurers call the process a "death spiral."
"It's Pollyannaistic not to believe that will happen," Shannon said. "That's the insurance industry ... to the extent that the law allows, you never write coverage for bad risks."
Koken opposes AHPs for the same reasons cited by Shannon, as does the National Association of Insurance Commissioners.
But AHPs have wide support among small businesses and groups including the U.S. Chamber of Commerce and the National Federation of Independent Businesses and from President Bush.
Jessie Howe Brairton of the National Federation of Independent Businesses said health-insurance costs can be reduced by freeing insurers from mandated benefits that most people don't need, such as hair replacement or fertility treatment.
She said AHPs also would drive down costs by creating more competition among health insurers. She said this is especially important in Pennsylvania, where the market is dominated by four Blue Cross-Blue Shield plans.
She said the Blues plans, which have taken a national stance against AHPs, oppose them because they threaten their market dominance.
Aji Abraham of Capital Blue Cross said the Susquehanna Twp.-based Blues plan opposes AHPs mainly because of the prospect of "cherry picking" and the subsequent impact on overall larger insurance pool.
Katie Strong, director of congressional and public affairs for the U.S. Chamber of Commerce, said AHPs, by enabling small businesses to join large groups covering multiple states, would increase their buying clout.
She also said the AHP bills include language intended to limit "cherry picking," and that cherry picking already occurs under insurance laws.
Regarding the freedom from state-mandated health benefits, the main problem is not the cost of providing those benefits, but rather the difficulty in dealing with state-by-state variances among mandates, Strong said.
These variances make it impossible to create one plan to cover workers in multiple states, she said. She also argued that the law already allows large companies and unions to create self-funded, multistate plans that are free from states' mandates. These companies typically provide the best health insurance coverage, she said.
However, opponents such as Koken have argued that staggering increases in premiums, which have risen by 10 percent or more annually for five years, have created desperation among small businesses that makes them vulnerable to attractively priced but inferior coverage.
Shannon said the best way to create affordable coverage is to reduce health care usage by helping people take better care of themselves, and improving health care quality to reduce extra costs caused by medical errors and hospital infections.
Over the years, AHP legislation has repeatedly been approved in the U.S. House, only to fail in the Senate, Shannon said. But he believes political dynamics have shifted, and the bill has a strong chance of passage this year.
But they are divided over a federal proposal intended to lower their costs by giving them some of the advantages enjoyed by large corporations and labor unions.
The federal proposal involves "association health plans," which would enable small businesses, through national trade associations, to band together across state lines to negotiate lower health insurance rates.
Supporters said the plans, known as "AHPs," would free insurers from state-mandated health benefits that drive up insurance costs, and would create more competition among health insurers.
A U.S. House committee recently approved a bill that would allow multistate AHPs, and a bill has been introduced in the Senate.
But a coalition of opponents, including Pennsylvania Insurance Commissioner M. Diane Koken and several of the state's Blue Cross-Blue Shield plans, are waging a campaign against AHPs.
"My concern is that two-thirds of all small businesses, or more, will be hurt by this," said Cliff Shannon, president of SMC Business Councils, a Pennsylvania organization that provides health insurance coverage for its members.
Shannon has been a leading a voice in the fight for affordable health care, and normally opposes state mandates.
But in this case, he argues that opening the door to insurers that would operate free of state regulations will harm the quality of coverage and undermine the health insurance market in Pennsylvania.
Shannon said the most logical way for AHP plans to lower costs is to form groups of the healthiest people while avoiding older people and those with conditions such as diabetes and cancer, and families with women who might become pregnant.
This practice, called "cherry picking," will increase the concentration of people with the greatest health care needs in the overall insurance pool, driving up costs even more, Shannon said.
That's because an effective health-insurance pool relies on spreading costs across a group that includes an adequate number of healthy people. Increasing the concentration of people with expensive medical needs drives up premiums to the point that healthy members drop coverage or seek it elsewhere. Insurers call the process a "death spiral."
"It's Pollyannaistic not to believe that will happen," Shannon said. "That's the insurance industry ... to the extent that the law allows, you never write coverage for bad risks."
Koken opposes AHPs for the same reasons cited by Shannon, as does the National Association of Insurance Commissioners.
But AHPs have wide support among small businesses and groups including the U.S. Chamber of Commerce and the National Federation of Independent Businesses and from President Bush.
Jessie Howe Brairton of the National Federation of Independent Businesses said health-insurance costs can be reduced by freeing insurers from mandated benefits that most people don't need, such as hair replacement or fertility treatment.
She said AHPs also would drive down costs by creating more competition among health insurers. She said this is especially important in Pennsylvania, where the market is dominated by four Blue Cross-Blue Shield plans.
She said the Blues plans, which have taken a national stance against AHPs, oppose them because they threaten their market dominance.
Aji Abraham of Capital Blue Cross said the Susquehanna Twp.-based Blues plan opposes AHPs mainly because of the prospect of "cherry picking" and the subsequent impact on overall larger insurance pool.
Katie Strong, director of congressional and public affairs for the U.S. Chamber of Commerce, said AHPs, by enabling small businesses to join large groups covering multiple states, would increase their buying clout.
She also said the AHP bills include language intended to limit "cherry picking," and that cherry picking already occurs under insurance laws.
Regarding the freedom from state-mandated health benefits, the main problem is not the cost of providing those benefits, but rather the difficulty in dealing with state-by-state variances among mandates, Strong said.
These variances make it impossible to create one plan to cover workers in multiple states, she said. She also argued that the law already allows large companies and unions to create self-funded, multistate plans that are free from states' mandates. These companies typically provide the best health insurance coverage, she said.
However, opponents such as Koken have argued that staggering increases in premiums, which have risen by 10 percent or more annually for five years, have created desperation among small businesses that makes them vulnerable to attractively priced but inferior coverage.
Shannon said the best way to create affordable coverage is to reduce health care usage by helping people take better care of themselves, and improving health care quality to reduce extra costs caused by medical errors and hospital infections.
Over the years, AHP legislation has repeatedly been approved in the U.S. House, only to fail in the Senate, Shannon said. But he believes political dynamics have shifted, and the bill has a strong chance of passage this year.
Thursday, July 21, 2005
A health insurance priority
Changing the individual market would allow more people to buy coverage.
By William J. Marino
Time and time again, we are reminded that the health-care system is broken when otherwise healthy people are forced to choose between paying high health-insurance premiums or doing without coverage.
One possible solution: Taking a serious look at reforming New Jersey's individual health insurance market.
First, it is important for everyone to have a basic understanding of what drives rising health-insurance premiums as we look for workable solutions. Health-insurance premiums are a reflection of the underlying costs of health care, such as hospital costs, physician fees, prescription-drug costs, and the cost of new medical technologies.
For every premium dollar Horizon Blue Cross Blue Shield of New Jersey customers pay, nearly 87 cents goes directly to paying our customers' medical claims - which last year was more than $8 billion. The remaining 13 cents represents administrative costs to service our more than 3.1 million members and maintain our hospital and physician networks. The percentage of premium for administrative costs has been declining, while the percentage going to pay medical costs continues to escalate.
There are a number of factors causing health-care costs to rise.
Increased consumer demand and utilization of medical services, advances in medical technology, increased use of prescription drugs, the practice of defensive medicine, poor lifestyle choices, and the failure to follow medical "best practices" all add costs to the system. Additionally, certain legislative and regulatory measures, including coverage mandates and how certain markets are required to operate, add substantial costs that increase the health-insurance premiums consumers pay.
As underlying health-care costs continue to drive up health-insurance premiums, more and more people are added to the ranks of the uninsured.
The New Jersey Business and Industry Association reported in April that many small companies are dropping health-insurance coverage for their employees because they cannot afford the average cost of $7,307 per employee. As prices continue to rise and more small companies drop health-insurance coverage, many more people will be forced to look for health insurance on their own in the individual market.
Unfortunately, the individual health-insurance market in New Jersey is broken, causing individual health-insurance policy premiums to be higher than they should be. As a result, many younger individuals who are healthy and employed remain uninsured.
New Jersey is one of a handful of states in which the individual market operates under what is known as "pure community rating." That means everyone is guaranteed a policy, and each person with a policy is charged the same premium, regardless of their age, gender or health status.
This system causes what we are experiencing in the individual market today in New Jersey: an underwriting death spiral. Medical costs for unhealthy individuals drive up premiums to a point where younger, healthier people with fewer medical expenses choose not to purchase expensive health-insurance policies. The individual market is left with more older and unhealthy individuals increasing the number of claims and costs.
For example in 2004, the number of Horizon BCBSNJ individual policyholders that had medical claims of more than $100,000 increased by 44 percent, and those claims each increased in cost by 74 percent. Such increasing costs drive up premiums, which prices healthier individuals out of the market making the situation even worse.
Currently, reform proposals are being considered by the Legislature, but those reforms do not go far enough. We support reforms that provide for adjusted community rating to allow insurers to set differing rates for individuals based upon age and gender, with the highest rates being 31/2 times the lowest rates.
According to a March study by Rutgers Center for State Health Policy, reforms allowing adjusted community rating at this ratio would reduce premiums for people below 45 years of age by about 66 percent. The center projected that more than 46,000 more individuals would purchase individual policies.
Horizon BCBSNJ, as the state's largest health insurer, is working on a number of initiatives to reduce health-care costs and reduce the number of uninsured. Reforming the individual health-insurance market to allow more younger, healthier individuals to purchase health insurance is an important first step. We are eager to work with legislators to develop workable reforms to do just that.
By William J. Marino
Time and time again, we are reminded that the health-care system is broken when otherwise healthy people are forced to choose between paying high health-insurance premiums or doing without coverage.
One possible solution: Taking a serious look at reforming New Jersey's individual health insurance market.
First, it is important for everyone to have a basic understanding of what drives rising health-insurance premiums as we look for workable solutions. Health-insurance premiums are a reflection of the underlying costs of health care, such as hospital costs, physician fees, prescription-drug costs, and the cost of new medical technologies.
For every premium dollar Horizon Blue Cross Blue Shield of New Jersey customers pay, nearly 87 cents goes directly to paying our customers' medical claims - which last year was more than $8 billion. The remaining 13 cents represents administrative costs to service our more than 3.1 million members and maintain our hospital and physician networks. The percentage of premium for administrative costs has been declining, while the percentage going to pay medical costs continues to escalate.
There are a number of factors causing health-care costs to rise.
Increased consumer demand and utilization of medical services, advances in medical technology, increased use of prescription drugs, the practice of defensive medicine, poor lifestyle choices, and the failure to follow medical "best practices" all add costs to the system. Additionally, certain legislative and regulatory measures, including coverage mandates and how certain markets are required to operate, add substantial costs that increase the health-insurance premiums consumers pay.
As underlying health-care costs continue to drive up health-insurance premiums, more and more people are added to the ranks of the uninsured.
The New Jersey Business and Industry Association reported in April that many small companies are dropping health-insurance coverage for their employees because they cannot afford the average cost of $7,307 per employee. As prices continue to rise and more small companies drop health-insurance coverage, many more people will be forced to look for health insurance on their own in the individual market.
Unfortunately, the individual health-insurance market in New Jersey is broken, causing individual health-insurance policy premiums to be higher than they should be. As a result, many younger individuals who are healthy and employed remain uninsured.
New Jersey is one of a handful of states in which the individual market operates under what is known as "pure community rating." That means everyone is guaranteed a policy, and each person with a policy is charged the same premium, regardless of their age, gender or health status.
This system causes what we are experiencing in the individual market today in New Jersey: an underwriting death spiral. Medical costs for unhealthy individuals drive up premiums to a point where younger, healthier people with fewer medical expenses choose not to purchase expensive health-insurance policies. The individual market is left with more older and unhealthy individuals increasing the number of claims and costs.
For example in 2004, the number of Horizon BCBSNJ individual policyholders that had medical claims of more than $100,000 increased by 44 percent, and those claims each increased in cost by 74 percent. Such increasing costs drive up premiums, which prices healthier individuals out of the market making the situation even worse.
Currently, reform proposals are being considered by the Legislature, but those reforms do not go far enough. We support reforms that provide for adjusted community rating to allow insurers to set differing rates for individuals based upon age and gender, with the highest rates being 31/2 times the lowest rates.
According to a March study by Rutgers Center for State Health Policy, reforms allowing adjusted community rating at this ratio would reduce premiums for people below 45 years of age by about 66 percent. The center projected that more than 46,000 more individuals would purchase individual policies.
Horizon BCBSNJ, as the state's largest health insurer, is working on a number of initiatives to reduce health-care costs and reduce the number of uninsured. Reforming the individual health-insurance market to allow more younger, healthier individuals to purchase health insurance is an important first step. We are eager to work with legislators to develop workable reforms to do just that.
Wednesday, July 20, 2005
National Atlantic's Auto Insurance Loyalty Discount
July 20, 2005
Proformance Insurance Company, the largest subsidiary of National Atlantic Holdings Corporation and a domestic New Jersey insurer, today announced that its Loyalty Loss Free Discount Program for its auto insurance policyholders has been approved by the New Jersey Department of Banking & Insurance.
Under the new program, policyholders who have been with Proformance as auto policyholders for three consecutive years will receive a 5 percent discount on premiums if they have had no claims during the three year period. Loss-free policyholders of six years or more will receive a 10 percent discount.
"Our track record of policyholder retention has been crucial to our overall success in the New Jersey personal insurance market," said James V. Gorman, chief executive officer. "We are pleased to have the opportunity to reward our loyal policyholders with premium discounts on their policies," he said.
The new discount applies only to the personal automobile insurance, whether mono-line or part of the packaged "High Proformance Policy that contains coverage for private passenger automobile, homeowners, personal excess liability and personal specialty property insurance covering jewelry, furs, fine arts, antiques, cameras, boats, yachts and other high value items.
Proformance Insurance Company, the largest subsidiary of National Atlantic Holdings Corporation and a domestic New Jersey insurer, today announced that its Loyalty Loss Free Discount Program for its auto insurance policyholders has been approved by the New Jersey Department of Banking & Insurance.
Under the new program, policyholders who have been with Proformance as auto policyholders for three consecutive years will receive a 5 percent discount on premiums if they have had no claims during the three year period. Loss-free policyholders of six years or more will receive a 10 percent discount.
"Our track record of policyholder retention has been crucial to our overall success in the New Jersey personal insurance market," said James V. Gorman, chief executive officer. "We are pleased to have the opportunity to reward our loyal policyholders with premium discounts on their policies," he said.
The new discount applies only to the personal automobile insurance, whether mono-line or part of the packaged "High Proformance Policy that contains coverage for private passenger automobile, homeowners, personal excess liability and personal specialty property insurance covering jewelry, furs, fine arts, antiques, cameras, boats, yachts and other high value items.
health insurance and hispanic children
WASHINGTON -- Hispanic children are less likely than other children to have health insurance or recommended vaccinations, disparities that a government study says will be magnified in the coming years by the nation's changing demographics.
By the year 2020, nearly one in four American children will be Hispanic, up from fewer than one in five today.
Ethnicity not source of difference
The data in the government report shows that the rising number of Hispanic children would help lower the rate of smoking among teens.
However, teen pregnancy rates would rise and the percentage of students completing high school would fall without changes occurring, said Dr. Duane Alexander, director of the National Institute of Child Health and Human Development, one of several federal agencies that contributed to the report.
''The people who follow population demographics and health disparities are very concerned about this,'' Alexander said.
The report also found that Hispanic children are more likely to live in poverty and to be overweight.
Dr. Edward Sondik, director of the National Center for Health Statistics, said the differences are not caused by race. ''But there may be circumstances that cause these differences,'' he said.
The data in the government report shows that the rising number of Hispanic children would help lower the rate of smoking among teens.
By the year 2020, nearly one in four American children will be Hispanic, up from fewer than one in five today.
Ethnicity not source of difference
The data in the government report shows that the rising number of Hispanic children would help lower the rate of smoking among teens.
However, teen pregnancy rates would rise and the percentage of students completing high school would fall without changes occurring, said Dr. Duane Alexander, director of the National Institute of Child Health and Human Development, one of several federal agencies that contributed to the report.
''The people who follow population demographics and health disparities are very concerned about this,'' Alexander said.
The report also found that Hispanic children are more likely to live in poverty and to be overweight.
Dr. Edward Sondik, director of the National Center for Health Statistics, said the differences are not caused by race. ''But there may be circumstances that cause these differences,'' he said.
The data in the government report shows that the rising number of Hispanic children would help lower the rate of smoking among teens.
Tuesday, July 19, 2005
Plan offers small businesses health insurance
Four local health systems are teaming up with Wayne County to offer a low cost health insurance program to small businesses, in an effort to address the growing number of uninsured Wayne County residents.
The program, called Wayne County Four Star Health, splits three ways a $168 monthly premium for qualified enrollees among the employer, employee and a nonprofit community group. Enrollees are restricted to what health systems they can use, but are not required to have a primary care doctor.
Rick Nowakowski, the Four Star administrator, said the program is similar to one Wayne County already offers called HealthChoice . But with 250,000 uninsured residents in Wayne County, he said there's enough need for both programs to co-exist.
"(Lack of insurance) is a problem across the country," Nowakowski said. "With the way the cost of health insurance has increased over the past 15 years due to increased technology and the aging of the population, it's increasingly gotten less affordable for a number of businesses."
Bob Cardoni, owner of Cardoni's Bar & Grill in Detroit, knows how challenging health insurance can be.
The Dearborn resident used to offer his employees insurance through Wayne's HealthChoice program until he lost eligibility because he didn't have enough employees who wanted coverage. Cardoni has roughly six employees but only a couple want health care coverage.
"It's a big challenge," Cardoni said. "It's expensive, especially for small businesses. You're not talking about Ford Motor Company, where you have deep pockets."
Created by St. John Health System, the Detroit Medical Center, Henry Ford Health System and Oakwood Healthcare System along with Wayne County, the Four Star program will cater to small businesses with between two and 49 employees. To qualify, businesses must have two-thirds of their workforce living in Detroit, pay $12 an hour or less to half their staff, and meet other criteria.
Nowakowski said Four Star is accepting applications now and enrollment will begin in September. He expects to enroll up to 5,000 uninsured employees in its first year.
The program, called Wayne County Four Star Health, splits three ways a $168 monthly premium for qualified enrollees among the employer, employee and a nonprofit community group. Enrollees are restricted to what health systems they can use, but are not required to have a primary care doctor.
Rick Nowakowski, the Four Star administrator, said the program is similar to one Wayne County already offers called HealthChoice . But with 250,000 uninsured residents in Wayne County, he said there's enough need for both programs to co-exist.
"(Lack of insurance) is a problem across the country," Nowakowski said. "With the way the cost of health insurance has increased over the past 15 years due to increased technology and the aging of the population, it's increasingly gotten less affordable for a number of businesses."
Bob Cardoni, owner of Cardoni's Bar & Grill in Detroit, knows how challenging health insurance can be.
The Dearborn resident used to offer his employees insurance through Wayne's HealthChoice program until he lost eligibility because he didn't have enough employees who wanted coverage. Cardoni has roughly six employees but only a couple want health care coverage.
"It's a big challenge," Cardoni said. "It's expensive, especially for small businesses. You're not talking about Ford Motor Company, where you have deep pockets."
Created by St. John Health System, the Detroit Medical Center, Henry Ford Health System and Oakwood Healthcare System along with Wayne County, the Four Star program will cater to small businesses with between two and 49 employees. To qualify, businesses must have two-thirds of their workforce living in Detroit, pay $12 an hour or less to half their staff, and meet other criteria.
Nowakowski said Four Star is accepting applications now and enrollment will begin in September. He expects to enroll up to 5,000 uninsured employees in its first year.
Insurance Probe Cooperation Between Feds and Spitzer Fizzles
July 19, 2005
Federal securities and justice department officials and lawyers from the office of New York Attorney General Eliot Spitzer, who are pursuing parallel investigations of the insurance industry, have made separate deals with witnesses that harm the other's cases and have generally stopped cooperating with each other since early May, according to a report in the Washington Post citing people familiar with the cases and legal experts.
One joint interview with an unidentified witness was canceled after the Securities and Exchange Commission learned that Spitzer had previously met with the witness's lawyer and discussed a deal, according to the report.
"Everyone is all smiles when it comes to cooperation between the agencies," the Washington Post quotes Jacob S. Frenkel, a former SEC enforcement lawyer and partner at Shulman, Rogers, Gandal, Pordy and Ecker PA, in Rockville, as saying. "But in truth, the competition for convictions and civil settlements is so intense that each regulator is putting its interest ahead of the public good."
Sources blame the disintegration in relations on news leaks surrounding the April 11 interview with Berkshire Hathaway Inc.'s Warren Buffet, whose General Reinsurance subsidiary is being investigated for finite reinsurance agreements with American International Group. Federal officials suspect that Spitzer staffers of the leaks, but the New York attorney general's people deny responsibility.
Fderal officials leading the probe declined to comment. They are Paul J. McNulty, the U.S. attorney for the Eastern District of Virginia; David N. Kelley, the U.S. attorney for the Southern District of New York; the Justice Department; and the SEC.
According to the newspaper, the gloves apparently came off in a May speech in Seattle in which Spitzer criticized the Bush administration for failing to investigate the insurance industry after his own probes of Marsh, Aon and others led to guilty pleas and fines of more than $1 billion.
"Not a word has come out of the White House about maybe there being a structural problem in the insurance industry," Spitzer, who is running for governor in his state, said in his remarks.
Federal securities and justice department officials and lawyers from the office of New York Attorney General Eliot Spitzer, who are pursuing parallel investigations of the insurance industry, have made separate deals with witnesses that harm the other's cases and have generally stopped cooperating with each other since early May, according to a report in the Washington Post citing people familiar with the cases and legal experts.
One joint interview with an unidentified witness was canceled after the Securities and Exchange Commission learned that Spitzer had previously met with the witness's lawyer and discussed a deal, according to the report.
"Everyone is all smiles when it comes to cooperation between the agencies," the Washington Post quotes Jacob S. Frenkel, a former SEC enforcement lawyer and partner at Shulman, Rogers, Gandal, Pordy and Ecker PA, in Rockville, as saying. "But in truth, the competition for convictions and civil settlements is so intense that each regulator is putting its interest ahead of the public good."
Sources blame the disintegration in relations on news leaks surrounding the April 11 interview with Berkshire Hathaway Inc.'s Warren Buffet, whose General Reinsurance subsidiary is being investigated for finite reinsurance agreements with American International Group. Federal officials suspect that Spitzer staffers of the leaks, but the New York attorney general's people deny responsibility.
Fderal officials leading the probe declined to comment. They are Paul J. McNulty, the U.S. attorney for the Eastern District of Virginia; David N. Kelley, the U.S. attorney for the Southern District of New York; the Justice Department; and the SEC.
According to the newspaper, the gloves apparently came off in a May speech in Seattle in which Spitzer criticized the Bush administration for failing to investigate the insurance industry after his own probes of Marsh, Aon and others led to guilty pleas and fines of more than $1 billion.
"Not a word has come out of the White House about maybe there being a structural problem in the insurance industry," Spitzer, who is running for governor in his state, said in his remarks.
Farmers Insurance ordered to pay $9.9 million in LA injury case
Associated Press
LOS ANGELES - Farmers Insurance Group Inc. was ordered to pay $9.9 million to two women for failing to defend them against a neighbor who sued for an injury at their condominium complex.
A Superior Court jury awarded the money to retirees Linda Williams, 65, and B.J. Walker, 80, who share a condo. They were sued by neighbor Juanita Wasson after she fell in front of their garage in 2001 and sustained a broken hip.
Wasson, who was 85 at the time, also sued the homeowners association for reimbursement of $60,000 in medical bills. She claimed Walker was responsible for the injury because she allegedly opened the garage door without first seeing if the driveway was clear.
The housing complex carried liability insurance with Farmers, which defended the association but not Williams and Walker. The insurance company filed a cross complaint against them, alleging Walker's negligence caused the injury.
Walker and Williams also filed suit against Farmers.
In a May bench trial, Superior Court Judge James R. Dunn ruled that Farmers had breached its contract by failing to defend the two women.
The jury on Friday awarded $1.5 million to Walker and Williams for emotional distress, $8.3 million in punitive damages and $52,000 in contract damages.
Farmers said in a statement, "We disagree with the verdict." The company is considering whether to ask for a new trial or to appeal.
LOS ANGELES - Farmers Insurance Group Inc. was ordered to pay $9.9 million to two women for failing to defend them against a neighbor who sued for an injury at their condominium complex.
A Superior Court jury awarded the money to retirees Linda Williams, 65, and B.J. Walker, 80, who share a condo. They were sued by neighbor Juanita Wasson after she fell in front of their garage in 2001 and sustained a broken hip.
Wasson, who was 85 at the time, also sued the homeowners association for reimbursement of $60,000 in medical bills. She claimed Walker was responsible for the injury because she allegedly opened the garage door without first seeing if the driveway was clear.
The housing complex carried liability insurance with Farmers, which defended the association but not Williams and Walker. The insurance company filed a cross complaint against them, alleging Walker's negligence caused the injury.
Walker and Williams also filed suit against Farmers.
In a May bench trial, Superior Court Judge James R. Dunn ruled that Farmers had breached its contract by failing to defend the two women.
The jury on Friday awarded $1.5 million to Walker and Williams for emotional distress, $8.3 million in punitive damages and $52,000 in contract damages.
Farmers said in a statement, "We disagree with the verdict." The company is considering whether to ask for a new trial or to appeal.
Health insurance for all Californians -- Less expensive than you think
The number of Californians without health insurance is growing rapidly. According to the California Health Interview Survey, in 2003, 6.6 million Californians (including 2.6 million undocumented immigrants) were uninsured at some time during the year, an increase from 6.3 million in 2001. Not only do these high numbers indicate a tremendous amount of needless suffering, but they also signal even greater fiscal pressure on federal, state and local governments.
Still, conventional wisdom tells us that even once the state's budgetary crisis turns around, there just won't be enough money to solve this problem. Considering the billions being spent to provide health care to the uninsured, however, it is clear that money isn't really the issue.
Today, the uninsured receive care through two different funding sources. Most uninsured patients pay directly for some portion of their care, or their care is subsidized directly by public and private sources, such as county indigent-care programs. The other source of funding is through indirect subsidies to "safety-net" facilities. These payments are indirect because they are not tied directly to specific patients.
This patchwork system should be replaced simply by subsidizing insurance premiums for the uninsured. This program could be implemented by allowing the uninsured to buy into existing public programs, such as Medi-Cal and Healthy Families, or into private insurance programs usually reserved for public employees, such as CalPERS. The most fundamental question in developing such a buy-in program, however, is: How much would it cost to insure all uninsured Californians? The answer is: Not as much as most people think.
It will cost $9.8 billion in 2005 to provide health care to California's uninsured, including $4.2 billion from out-of-pocket payments, $2.6 billion from government sources and $3 billion from charitable organizations, according to a report from the UCLA Center for Health Policy Research. Federal, state and county governments will spend an additional $3.6 billion in subsidies to safety-net providers to cover indirectly the costs of caring for the uninsured, mostly in hospitals and community-health centers. Combining these direct and indirect expenditures means that a combined total of $13.4 billion will be spent to care for uninsured Californians in 2005, including a total of $6.2 billion in federal, state and county subsidies and $3 billion in charitable contributions.
According to our recent calculations at UCLA, the uninsured would use approximately $14.3 billion in health-care services if fully insured, because having insurance always increases spending. This is a staggering amount of money -- equal to recent deficits in the state budget. But given that Californians already spend $13.4 billion to care for the uninsured, our state is looking at a gap of only about $900 million.
This $900 million represents less than $150 additional dollars for each uninsured individual in California. To place this number further in context, $900 million represents an increase of about 6 percent in current total spending for the uninsured and an increase of less than 1 percent of overall health-care spending in the state. So, if health care for all Californians really is so affordable, why can't we solve this persistent problem?
One barrier is combining the diverse funding streams for the uninsured into a single program. Facilities that currently receive subsidies are not willing to give them up. However, if all uninsured Californians were provided with health insurance, the indirect subsidies provided to safety-net facilities to care for the uninsured could be reduced, because subsidies to safety-net providers would be largely replaced by insurance payments.
This $900 million increase in subsidies would greatly benefit the state and the counties. If we could find the political will to consolidate the direct and indirect sources of revenue into a single program, appropriate health care could be provided to every Californian. Having a regular health- care provider and full insurance coverage would enable all Californians to seek care when needed, obtain preventive care, get referrals to specialists and receive early interventions for chronic and developing diseases, thus avoiding costly emergency-room visits and unnecessary hospital admissions.
Our research indicates that current expenditures from all sources for the uninsured in California, if combined into a single program and supplemented with modest additional expenditures, could provide sufficient funding to provide California health insurance for all of California's uninsured. Isn't it time we solved this problem once and for all?
Still, conventional wisdom tells us that even once the state's budgetary crisis turns around, there just won't be enough money to solve this problem. Considering the billions being spent to provide health care to the uninsured, however, it is clear that money isn't really the issue.
Today, the uninsured receive care through two different funding sources. Most uninsured patients pay directly for some portion of their care, or their care is subsidized directly by public and private sources, such as county indigent-care programs. The other source of funding is through indirect subsidies to "safety-net" facilities. These payments are indirect because they are not tied directly to specific patients.
This patchwork system should be replaced simply by subsidizing insurance premiums for the uninsured. This program could be implemented by allowing the uninsured to buy into existing public programs, such as Medi-Cal and Healthy Families, or into private insurance programs usually reserved for public employees, such as CalPERS. The most fundamental question in developing such a buy-in program, however, is: How much would it cost to insure all uninsured Californians? The answer is: Not as much as most people think.
It will cost $9.8 billion in 2005 to provide health care to California's uninsured, including $4.2 billion from out-of-pocket payments, $2.6 billion from government sources and $3 billion from charitable organizations, according to a report from the UCLA Center for Health Policy Research. Federal, state and county governments will spend an additional $3.6 billion in subsidies to safety-net providers to cover indirectly the costs of caring for the uninsured, mostly in hospitals and community-health centers. Combining these direct and indirect expenditures means that a combined total of $13.4 billion will be spent to care for uninsured Californians in 2005, including a total of $6.2 billion in federal, state and county subsidies and $3 billion in charitable contributions.
According to our recent calculations at UCLA, the uninsured would use approximately $14.3 billion in health-care services if fully insured, because having insurance always increases spending. This is a staggering amount of money -- equal to recent deficits in the state budget. But given that Californians already spend $13.4 billion to care for the uninsured, our state is looking at a gap of only about $900 million.
This $900 million represents less than $150 additional dollars for each uninsured individual in California. To place this number further in context, $900 million represents an increase of about 6 percent in current total spending for the uninsured and an increase of less than 1 percent of overall health-care spending in the state. So, if health care for all Californians really is so affordable, why can't we solve this persistent problem?
One barrier is combining the diverse funding streams for the uninsured into a single program. Facilities that currently receive subsidies are not willing to give them up. However, if all uninsured Californians were provided with health insurance, the indirect subsidies provided to safety-net facilities to care for the uninsured could be reduced, because subsidies to safety-net providers would be largely replaced by insurance payments.
This $900 million increase in subsidies would greatly benefit the state and the counties. If we could find the political will to consolidate the direct and indirect sources of revenue into a single program, appropriate health care could be provided to every Californian. Having a regular health- care provider and full insurance coverage would enable all Californians to seek care when needed, obtain preventive care, get referrals to specialists and receive early interventions for chronic and developing diseases, thus avoiding costly emergency-room visits and unnecessary hospital admissions.
Our research indicates that current expenditures from all sources for the uninsured in California, if combined into a single program and supplemented with modest additional expenditures, could provide sufficient funding to provide California health insurance for all of California's uninsured. Isn't it time we solved this problem once and for all?
Monday, July 18, 2005
How Medicare, Medicaid differ
Monday, July 18, 2005
JAMES T. MULDER
HEALTH CARE NOTEBOOK
Q.
What is Medicaid, and how is it different from Medicare?
A.
Medicare and Medicaid are both types of health insurance, but they are not the same.
Medicare is a federal program for people 65 and older and people who are disabled.
Medicaid is for people with low incomes who fit into certain categories. Medicaid is a partnership between the federal and state governments. Medicaid helps low-income people of all ages pay for medical and long-term care such as nursing home care. To qualify for Medicaid, you must meet the income and resource guidelines established by New York state.
Income is money you get from Social Security, a job, pension or other sources. Resources are things you own, such as a savings account. But Medicaid doesn't count everything. Some things such as your home and one car are not counted.
A single person, for example, cannot have monthly income of more than $667 or resources of more than $4,000. For a two-person family, the monthly income limit is $975 and the resources limit is $5,850. For a four-person family, the income limit is $992 and the resource limit is $5,950.
JAMES T. MULDER
HEALTH CARE NOTEBOOK
Q.
What is Medicaid, and how is it different from Medicare?
A.
Medicare and Medicaid are both types of health insurance, but they are not the same.
Medicare is a federal program for people 65 and older and people who are disabled.
Medicaid is for people with low incomes who fit into certain categories. Medicaid is a partnership between the federal and state governments. Medicaid helps low-income people of all ages pay for medical and long-term care such as nursing home care. To qualify for Medicaid, you must meet the income and resource guidelines established by New York state.
Income is money you get from Social Security, a job, pension or other sources. Resources are things you own, such as a savings account. But Medicaid doesn't count everything. Some things such as your home and one car are not counted.
A single person, for example, cannot have monthly income of more than $667 or resources of more than $4,000. For a two-person family, the monthly income limit is $975 and the resources limit is $5,850. For a four-person family, the income limit is $992 and the resource limit is $5,950.
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