Blue Cross offers a concession
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| Lack of choice is part of the current problem |
Recently,
I wrote about the impact insurance company pay rates have on our two South
County hospitals – Westerly and South
County – whose rates for providing the same services are generally much lower
than, for example, Rhode Island Hospital, even though patients rate the services of Westerly, and in particular, South County much higher.
In
response to adverse publicity, Blue Cross/Blue Shield said it would begin being more transparent about its
payment rates by no longer writing a clause into future contracts that forbids
health care providers from disclosing how much they get paid by Blue Cross.
This
change would take effect as new contracts are signed. State Insurance
Commissioner Christopher Koller had planned to require insurance contracts to
include price transparency. And our local state Senator Dennis Algiere, the
Senate Republican minority leader, had introduced legislation to require transparency.
It’s a baby step in the right direction, but there’s still a long way to go before the public can find fair deals in health care in the marketplace.
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| How's that socialized medicine thingy workin' out for ya, Sarah? |
In
the usual back-and-forth both in comments, conversations and e-mails, the overwhelming
power of insurance companies in the health care system became more and more
apparent. They control the purse strings, and by so doing, they can control
which health care providers thrive and which fail, as well as who lives and who
dies. And they often times do it with little justification.
Some
of you may remember that last year, Rep.
Donna Walsh took on one of the more
outrageous aspects of health insurance conduct through legislation that would have banned the common insurer
practice of charging women who buy individual insurance coverage more than men for no other reason than they are
women. Donna plans to reintroduce that bill.
The
insurance lobby actually testified that their reason for this was so they could keep rates
low for young men. They said they need to offer an enticement, since young men are notorious for being
uninsured unless they get coverage through their employment.
I
received one comment recently which was not the first one very sore spot in
Rhode Island’s medical system. Rhode Island has chosen what seems to me to be
the worst way to finance medical care. The
state severely limits the choices offered to Rhode Island employers and group buyers to a very small number of
insurers – Blue Cross, UnitedHealthCare and Tufts.
The
lack of choice hampers competition, which is the one saving grace the free
market approach to health care offers to consumers. By state mandate, just three private companies corner the market.
Personally,
I believe we can work around the edges and tweak the system a bit to reduce a
few of the worst aspects of the system, but will not catch up with the rest of
the industrialized world until we go to a single-care system, perhaps like a Medicare-for-all arrangement.
Let
the private insurers sell supplemental insurance, as they do now to Medicare
members, but let’s use the tried and true basic coverage system that Medicare
offers to provide basic universal coverage.
The US scores so poorly when compared to the rest of the First World nations because we do not have a universal health care system. That is, until Americans turn 65 and go on Medicare, whereupon their life expectancy is as good as or better than the other nations on the list.
Will, you concede that competition, transparency of prices, and other free market aspects would reduce the price of health insurance. Well, yes, that is how the rest of the economy works. Who would ever think of buying a service (say car repair) without having some idea of the cost of that service. Who would engage a company that was committed to secrecy of its charges? It is a crazy system and yet that is, as you say the system we have now. It is a government mandated oligarchy (monopoly, only with 3 players instead of just one). It puzzles me why you consider Medicaid the tried and true system that we should adopt. Should we then dis-allow FedEx and UPS and just use the US postal service?
ReplyDeleteBeth Richardson
Medicare, Beth, not Medicaid. Two very different programs - Medicare is universal for everyone over 65, while Medicaid is means-tested and thus much more complicated.
ReplyDeleteMy view is that the best approach - tried and true in the US with Medicare and tried and true in the 16 other industrialized nations who all have national health programs, is a single-payer system.
But since the right has scared Americans with its "socialized medicine" rhetoric, we have a haphazard largely private system.
Because of the nature of my work before I retired, Cathy and I had several different, changing private insurers, sometimes three at overlapping times, and spent perhaps over 100 hours over the past few years just dealing with "coordination of benefits" issues. We know many more man-hours were spent at our providers and carriers dealing with this issue. All of it adds to make our system the most expensive and least efficient system among the industrialized nations.
But absent a single-payer system, I am persuaded that open competition and transparent pricing is important.
Mea Culpa for my carelessness. I do know the difference between Medicaid and Medicare.
ReplyDeleteFor any other aspect of our economy we value open competition and transparent pricing. We know that that is the best way to get what we want. Even if we eschew Walmart and chose the local store instead we do so because we can see what we are getting and at what price. We agree that the behemoth crony capitalist health insurance situation is untenable. Ok. So why would we chose to go to a model that is more state run,that is, like Medicare is, rife with fraud and waste and whose costs keep increasing, with corresponding decrease in services? Why wouldn't we go instead to a model with more competition, the allows for innovation, where we see what we are getting and for what price? There are a million ways that health care could be delivered at lesser cost. Right now, however, most of those ways are illegal. As an example, there are groups that go around the country holding free health care days (similar to what Arrowhead dental does here in Charlestown on occasion). However, they can only have medical people at those clinics that are licensed in the state where the event is taking place. I have read quotes from doctors who say it is easier for them to go to another country to take part in such an event than it is to go to another state in this country to do so. This is silly. If one is poor and is being offered medical care for free, do you think it matters one iota whether the doctor's license is from RI or Iowa?
As another example, it is illegal to buy health insurance from a company from another state, like we do for auto insurance. We are stuck with Tufts, Blue Cross Blue Shield and one other whose name I cannot remember right now. There are other aspects of auto insurance that could work for health care as well. They are illegal, or will soon be. I have a high deductible health insurance plan with a health savings account. It is more like the auto insurance model in that I pay for my maintenance health care costs out of pocket (actually with my tax-free health saving account), but use my health insurance if I get really sick. My insurance plan is going to be defunct once Obamacare is implemented.
Beth Richardson
I guess every insurance company should provide the same rates if the facilities they are providing are comparable.
ReplyDeleteBeth - most states are not like Rhode Island (understatement, I guess) in so severely restricting insurance choice. In states with wider choices, the same problems of cost, quality and access exist to different degrees.
ReplyDeleteAnd insurance fraud is widespread, and not at all limited to or most severe in Medicare or Medicaid.
As for innovation, I think Medicare sparked plenty of interesting innovation in the way private insurers package, price and present supplemental coverage.
I hope the US will finally join the rest of the civilized world in providing a simple, basic universal level of health coverage to ensure that health becomes a basic right. Other nations permit lively markets in supplemental insurance - as we do now for Medicare - to permit people to add to that baseline coverage.
But it's the lack of that basic coverage that lowers American life expectancy and allow high levels of preventable illnesses from sapping our nation's vitality and productivity.