Thursday, December 31, 2009
Standing in line. I have been standing in line for over twenty minutes at the Beachwood Post Office, waiting for my turn, hoping to learn the fate of my missing mail. It is Monday, December 28th and there are only five of us in line. The women look inpatient, but remain silent. The guy in his late forties is visibly agitated. As more people join our line to see the one, and only, postal worker, Mr. Unhappy tells us that we should “get used to this. This is what life will be like once the government controls health care”.

How many times have we heard that refrain since Mrs. Clinton’s attempt at health care reform? Government Health Care will have the efficiencies of the Post Office with the compassion and customer service of the IRS! I think that statement is terribly unfair to the Internal Revenue Service. I have had to deal with the IRS, for my business, several times and found the agency professional and courteous. Seriously. The Post Office, however, can be a challenge.

The Post Office should serve as a cautionary example of what could happen if the government became too involved with the delivery of health care. How involved is too involved? I will have to leave that up to each of you. My personal opinion is that if we haven’t already crossed the line, we are probably very, very close.

At the top of this post I described the line at the Beachwood Post Office. The Post Office for 44122 is located on Green Road, about a block south of Chagrin Boulevard. Where is the Post Office for 44120? The SHAKER HEIGHTS Post Office is located on Warrensville Center Road, a few hundred yards south of Chagrin Boulevard, less than a mile away. Hell, the 44120 Post Office is located within 44122. The new Post Office was built while Stephanie Tubbs Jones was still alive and serving in Congress. It was placed next to the then Office Max Headquarters in the heart of a very powerful Congressional leader’s district.

You may be wondering whether 44120 really needed a separate Post Office or if one or possibly a few of these separate buildings could have been merged into one larger, more efficient structure. Surely you have guessed that the driving force was payroll taxes to the City of Shaker Heights and not the delivery of letters and catalogues. The more control government has in the actual delivery of health care, the more politicized it becomes. Is your representative powerful enough to make sure that there will be doctors’ offices near you?

“Dave, you’re being silly”, you scoff. “Congressmen and Senators would never exercise power that blatantly.” Ladies and Gentlemen, I give you Ben Nelson.

The Senate Democrats needed 60 votes to get their bill through. Technically, that meant that any one of them could have prevented passage. Technically but not really. Some, like our Senator, Sherrod Brown, were going to vote for this bill no matter what. They had no position to bargain.

Joe Lieberman was one of the first to stand up. He said that he wouldn’t accept a bill that had a Public Option. He wasn’t the only Senator. He was just the one who took the heat. Because he was willing to take a leadership role, he got his deal. Ben Nelson, coming from Nebraska, was willing to take the very public position of opposing any bill that might use taxpayer money to pay for abortions. Again, he wasn’t the only Democratic Senator who would have voted NO. He was the one willing to take the heat. For this he got the promise of millions of dollars. His fellow Senators offered to pick up the tab for Nebraska’s Medicaid bill. Poor people in Omaha may one day owe their free health care to the residents of Parma.

The Republican state attorney generals will eventually threaten to sue the federal government. I suspect that several Republican governors will also make noise. I really don’t think it matters since I doubt that the Nebraska deal clears the conference committee. But this is the start.

My letter carrier was on vacation and I may, or may not, start to receive all of my mail soon. One of the pieces of mail I may have missed was how our Congresswoman and Senator are bringing jobs and programs to our district. I’d sure like to see the report Ben Nelson sent to his.


Imagine My Disappointment

Wednesday, December 23, 2009
My one and only trip to Washington DC was about twenty years ago. This is odd for someone as politically active as me. I was attending a B’nai B’rith national policy conference. What a trip! I had the opportunity to tour the White House and Senate, visit the Lincoln Memorial and Washington Monument, and talked, one on one, with several Senators. But the most inspiring person I met, the guy who made the biggest impression, was one of the featured speakers, the young Ohio Secretary of State, Sherrod Brown.

I have been a Sherrod Brown fan for twenty years. And now I am truly disappointed.

OK, Sherrod Brown and I do not see eye to eye on the health care debate. That’s not news. What is shocking, at least to me, has been the way he has argued his case. I expected more from Sherrod Brown than the factless, emotional presentations of late. This Sherrod Brown plays well to most of Rachel Maddow’s audience. He appears on her show and Keith Olbermann’s Countdown to feed the base. No Problem. Sunday, December 20, 2009, he was on Face The Nation, the venerable CBS show. It was a cringe-worthy presentation.

Bob Schieffer, the moderator of Face The Nation, tries to give his guests enough time to talk in complete sentences. Used to speaking snippets and catch phrases on television, many politicians falter when given the extra time. Senator Brown must have misplaced his index cards. He kept on talking about the evil insurance companies charging women more than men. He also briefly mentioned that age is also a pricing factor, but quickly retreated back to gender.

I touched on this very subject in my October 19th post. In the past I would have wished that Mr. Brown had seen my blog. Now I’m not so sure that it would matter. Will Sherrod Brown let the facts get in the way of a good argument?

I had a client contact me today. She was worried that her health insurance policy was all screwed up. After watching TV, she couldn’t understand why her premium was substantially less than her husband’s even though he is four years her junior. Her policy is fine, it is our politicians that are screwed up. So I ask for your patience while we discuss a real issue with real numbers.

Case Study #1
Bob and Jane are healthy 21 year olds living in Cuyahoga County. They are both single, non-smokers, and have clean driving records. They need to purchase liability auto insurance from their neighborhood Erie Insurance agent. I wasted a half hour of Brian Ritzenberg’s time. They also need a basic health policy from Anthem Blue Cross with a $1000 deductible, office visit copays and an Rx card. And while they are at it, they are each going to purchase a twenty year term policy for $250,000 from North American. Auto, Health, and Life Insurance. Nothing out of the ordinary.

Auto - $731 per year
Health - $123.45 per month
Life - $217.50 per year

Auto - $630 per year
Health - $157.54 per month
Life - $205 per year

The price of insurance reflects the risk. Young men have more accidents. They pay more for auto insurance. Young women have more medical claims. They pay more for health insurance. Some young women may need to purchase their own health insurance. Almost all young women, at least here in Northeast Ohio, drive.

Case Study #2
Joseph and Pamela are healthy 61 year olds living in Cuyahoga County. Everything, including the amount of time I wasted of Brian’s, is the same as above except for their ages.

Auto - $358 per year
Health - $539.64 per month
Life - $1960 per year

Auto - $358 per year
Health - $515.66 per month
Life - $1550 per year

Life insurance is less expensive for adult women, young and old. Auto insurance is the same price or less for women at every age. Health insurance is sometimes less, sometimes more. With all of the online rating services, anyone can recreate this little test from the comfort of their home or office. In other words, you know that Senator Brown’s argument is specious at best.

We have almost a year invested in this process. That means that I have been sitting here for twelve months waiting for the Sherrod Brown I met in Washington twenty years ago to show up. The current Sherrod Brown is no longer inspiring. Imagine my disappointment.


Built By Committee - Designed to Fail

Tuesday, December 15, 2009
Senator Harry Reid is fighting a deadline. The President may have wanted a bill before Labor Day, but they want ice water in Hell, too. Reid, the pragmatist, knows the real target, December 31st. The last thing he wants is to be holding a hot potato of a health care bill in January, or worse, February.

Senator Reid has a problem.

Regular readers of this blog know that I have been asking one question from the start, What is our Goal? It is unfortunate that even though our political leaders may not have had well defined, easily explained goals, they all had solutions. Creating questions to given answers is the basis of the television show Jeopardy! Creating legislation to preconceived answers puts all in jeopardy.

It is hard to describe the pending legislation as health care reform. In fact, it is not even insurance reform. The current bills appear to reposition the government’s role in the payment of health services. Based on the numbers coming from the Congressional Budget Office, some critics think that this is just Washington once again proving that it can turn wine into water.

Let’s take a quick look at a few of the issues:

PUBLIC OPTION – Previous blogs have dealt with this particular issue. If nothing else, the Senate does not have 60 votes to pass a bill containing a Public Option.

MEDICARE OPENED TO PEOPLE AGE 55 TO 64 – This idea had a two minute life span. Nancy-Ann DeParle, the director of the White House Office of Health Reform, is quoted in the December 12th Plain Dealer. “Let me be clear, it’s not adding 55 year olds to Medicare.” If this is only Medicare-like coverage, it is really the Public Option. Please see the above.

ABORTION - Once you get the government involved, really involved, in the delivery or payment of health care, abortion is almost always the first serious question. Conservatives, Democrats and Republicans, won’t allow federal money to pay for this procedure. Liberals want to pretend that they won’t back down. Again. Couples suffering from infertility issues want to insert coverage for in-vitro into this discussion.

NEW TAXES AND FEES #1 – The pharmaceutical industry thought that it had a deal with President Obama at a very fudgeable $80 billion. The House of Representatives passed a bill that would hit the drug makers for $140 billion. The Senate’s version has yet to be released.

NEW TAXES AND FEES #2 – The Senate has proposed a new, non-deductible, tax of $6.7 billion a year on the health insurers. The easiest way to make health insurance more affordable is to add huge new costs to the health insurance companies. Makes perfect sense. To Congress. You and I might also wonder if, as the President suggested, the purpose of a Public Option was to give the insurers real competition. The best way to compete? Give the insurers huge new taxes.

NEW TAXES AND FEES #3 – The Senate has proposed a new tax on cosmetic surgical procedures. The bill currently includes a 5% tax on tummy tucks, facelifts, etc… This is a tax on medical procedures that are not usually covered by insurance. The doctors are howling. Their first line of defense is to note that the majority of these procedures are performed on middle class women with an average income of $30,000 to $50,000 per year. The second line of defense will be to add that other elective procedure, abortion, which should end the conversation.

NEW REDUCTIONS IN MEDICARE PAYMENTS - The Senate bill anticipates significant cost cutting at hospitals and nursing homes. They are so sure of this happening that they are lowering Medicare payments now. We already have Medicare’s underpayments shifted to those of us with private insurance. Reductions in Medicare reimbursements simply mean more costs shifted to us which just means higher insurance premiums. The Government’s Centers for Medicare and Medicaid Services (CMS), according to that same Plain Dealer article, states that the other option from these cuts will be the forced closing of about 20% of these institutions.

Today is December 15th, nine days till Christmas Eve. Can Reid deliver a bill for Christmas? If the President and the Democrats, and at this point it is a one party bill, enact legislation, the Republicans will have a winning campaign next fall. If legislation is blocked by the Republicans, the President and his party can paint the opposition as obstructionists who were too busy saying “NO” to help solve the problems of average Americans.

Considering how awful this legislation is, will Senator Reid win now and lose next November or has he already realized that the reverse, losing now and winning later, is much better? Is this program designed to fail?


Laying In The Gutter? It's My Fault!

Thursday, December 3, 2009
“It’s the insurance company’s fault that there are drug addicts walking the street.”

I did not know that. I needed the twenty year old junkie to explain this to me. After alienating her parents and step-parents, dropping off their coverage even though she is a full-time student, and suddenly getting married, she was surprised that insurance companies weren’t standing in line to welcome her in their warm embrace.

Of course, she was in my office for over a half an hour before she finally told me the truth. Thirty one years in this business has to be worth something. I could tell, I could feel that there was more than what she was disclosing. Bit by bit she released more information to me. It wasn’t until I had begun a pre-screen application that she dropped the bomb, her fourth on-going medication was an opiate blocker that costs $900 per month!

Forget everything but the math for a second. She wants to be allowed to pay $100 per month to Anthem Blue Cross so that the insurer can buy her $900 drug and three other medications. Shockingly, Anthem, Medical Mutual, et al… said “No Thanks”.

It was at this time that she informed me that her addiction is “genetic, like cancer”. Her mother is an alcoholic, so it is natural for her to have been hooked on heroin and methadone. “It is a disease. That’s what you learn at Alcoholic’s Anonymous.”

She spent an hour and a half in my office alternatively complaining about her parents who don’t want to have anything to do with her and the insurers who don’t want to have anything to do with her. She has options. Unwilling or unable to make the calls, I grabbed my phone and contacted her previous insurer, her mother’s employer, and went online to research the local university's student policy. She can be covered, but it will take some time and effort on her part.

She will not be covered.

Which part is more frustrating, the self destructiveness of the drug addiction of a teenager or the delusion that someone else is to blame for one’s behavior; the refusal to take the necessary steps to solve one’s problems or the anger that there are lifelong consequences for one’s actions? She sat there whimpering while I tried to solve her most immediate problems.

Will any of the proposed changes in Washington solve her problems? NO! Even if we have a policy that would take everyone and provide any known pharmaceutical remedy, there is no guarantee that she would even sign up. More importantly, Congress is incapable of passing a law that would force Americans to take responsibility for their actions.


By the way, Jeff Bogart,my business partner, and Michael Saltzman, my attorney, went ballistic when they read the original post of this blog. So I have made a couple of key changes to completely hide the identity of the man/woman subject of this story. I guess you can't be too careful.

The Public Option

Tuesday, November 24, 2009
Office space was at a premium in East Podunk, Kansas. Approximately 90% of the buildings were occupied on any given day. The building owners were getting fat and sassy. There was no need to reinvest or renovate their properties. At least, that’s what the mayor was saying. How could the mayor and city council solve this problem?

The mayor of East Podunk convinced the city council to strengthen the zoning laws. The new regulations were a hassle, but the building owners quickly adapted, made the required renovations, and profitably passed the costs to their tenants. Rents went up. The mayor seethed.

An office in East Podunk, Kansas carried a certain cache. It also carried a heavy price tag. The mayor heard the complaints. None of the councilmen worked in East Podunk, not even the ones who owned their own businesses. Something had to be done to make East Podunk more affordable without reducing the quality of the office space. How could the mayor keep the building owners honest? The landlords needed competition.

East Podunk, Kansas needed a public option.

The city of East Podunk purchased a building and began to compete with the landlords. The building owners immediately noticed:
1. Their new competitor, the government, owned a building that couldn’t pass the new code.
2. Private businesses must build property tax, snow removal, and other maintenance costs into their rent. The city did not.
3. Private businesses pay property taxes which benefit the schools. Again, the city did not.
4. The city fathers of East Podunk, embarrassed by the prospect of a large empty building, cut any deal to find tenants.

Yes, the city of East Podunk succeeded in keeping the building owners honest. Honestly mad. Governments can compete, one city or one state versus another, but they don’t compete with businesses.

Building owners? Health insurance companies? You can change the names. You can change the venues. What won’t change is the behavior of government entities with too much money and too little talent.

We all live in East Podunk, Kansas.

By the way, I heard from a lot of people who wanted to post a comment to one of the last few blogs. I am trying to see if there is an easier way. My offer still stands. You may email me at and I will post your comment for you.

Just Enough Research

Friday, November 13, 2009
79.3% of all statistics are created at the moment of citation. (margin of error +/- 4%)

Last Sunday’s Cleveland Plain Dealer reprinted a New York Times column written a few days earlier by Nicholas Kristof. Forum section. Page 2, directly beneath the Darcy cartoon. The great thing about appearing on the Opinion Page is that reporting and facts are optional. Mr. Kristof is convinced that our health care pales in comparison to the incredible medicine practiced in Canada, Great Britain or even Slovenia.

I was about to put this article away in favor of a better use of my time, Sudoku, when I saw the claim that Canadians live longer than Americans (his word, not mine) after a kidney transplant. That got my attention.

Regular readers of this blog know that I am not going to disparage the Canadian health care system. I’m not a huge fan, but there aren’t Canadians dying in the streets. So, is post-kidney transplant care significantly better in Canada than here in the US? Possibly, but it just seemed too easy. I had the feeling that Mr. Kristof did just enough research.

Let’s start with the source of this information. Mr. Kristof doesn’t cite his source, but a quick GOOGLE search turns up Nicholas Skala, a staff person for Physicians for a National Health Program. Mr. Skala wrote his report for the organization dedicated to single payer health care in 2006. It has been cited numerous times by publications such as The Washington Monthly. One of Mr. Skala’s assertions was that kidney transplants were more numerous in Canada since they didn’t have the profit motive of keeping patients on dialysis. I read that twice and knew that I needed to do more research.

Population as of November 9, 2009
United States – 307,897,484
Canada – 33,838,720 about 11%

Kidney transplants performed in 2007 (last data available)
United States – 16,517
Canada – 1,200 about 7%

Not more, but less. So are US citizens 50% more likely to need a kidney transplant? Does the Canadian system cherry pick who is eligible for a kidney? There are actually several issues involved.

1. I found the actual 2005 study which was published in the American Journal of Transplantation in 2006. The study compared post-transplant mortality among adult recipients between January 1, 1991 and December 31, 1998. Mr. Kristof’s article made this appear to be current information. It is not.
2. Canada did not have a national registry until this year. They have had a real problem matching donors to potential recipients. This will help.
3. 23.2% of the kidney recipients in the study were African Americans as opposed to 2.6% of the Canadians. As the study indicated, factors such as diabetes mellitus, age, and the number of donors of African descent may have an impact in the outcome of the report. The authors noted the lack of detailed donor data from CORR (Canadian Organ Replacement Register).
4. Is there equal access to kidney transplants in Canada? The answer is “No” according to Dr. Jeffrey A. Zaltzman of Toronto’s St. Michael’s hospital. That was published August 29, 2006. “No” wrote the Calgary Herald on November 9, 2009 when they noted that “the disparities in the medical treatment received by First Nations people compared with other Canadians have attracted growing national and international attention.”

I don’t have the research staff of the New York Times. Felicia, my secretary, and I spent a couple of hours following links on GOOGLE. I learned far more than I ever wanted to know about kidney transplants, everything from how much dialysis costs (a fortune, up to $150,000 a year) to how few transplant facilities there are in Canada.

What I learned is that Canadians who live near a major hospital and have the good fortune of a live donor have an excellent chance of survival. There are a lot more facilities and options here in the United States. In other words, the Peace Bridge is not going to be bumper to bumper with Americans searching for kidneys.


One more thing. The Kristof article also stated that “An African-American in New Orleans has a shorter life expectancy that the average person in Vietnam or Honduras. Found that too! The original report was posted on WWLTV’s website on September 18th. The Update was posted on October 22nd. The doctors noted that African-Americans are sicker longer, have lower incomes and a large portion are uninsured. It was crime and the murder rate, however, that got the most focus. Dr. Kevin Stephens, the director of the city’s health department said “All of these things work together. We just can’t fix health care. You’ve got to fix education. You have to fix the crime. Your have to fix the entire community.” It was also noted “that whites in Louisiana, on average, will live four years longer than African Americans in the state, but even that is still lower than the US average.”

I’m sorry this was so long. I just think that the details are important.

Falling Through The Cracks

Wednesday, November 11, 2009
The three key stakeholders in the delivery of health care to our citizens are the government, the medical community, and the insurance companies. It has been the goal of this blog to show that none of these players can ever be allowed to operate unchecked.

Yes, I come to this discussion as a thirty plus year veteran of the insurance business. My experience colors my point of view as much, if not more, than my income needs. But, it is fair to ask if I have covered insurance problems and access sufficiently.

Today we tackle an insurance problem.

Joan Rogers (as usual, not her real name) was referred to me by one of my loyal readers. Joan is a self-employed professional in her late fifties. Her divorce was finalized in December 2006. She has been covered under her ex-spouse’s group health insurance policy ever since. Her COBRA ends next month. Joan Rogers is in trouble.

Ms. Rogers has several medical conditions. None are life threatening, but none are cheap to control. Her three medications have a combined cost of $7,700 per year. She does not qualify for a comprehensive individually underwritten medical insurance plan. Since she doesn’t have an employee or business partner, we can’t write a group policy. A group policy would have to take her. She doesn’t want to stop doing what she does just to get a job that provides insurance benefits. Well educated and talented, Joan wants to continue her career.

What are Joan’s options?

First, is it unfair that she doesn’t qualify for a regular policy? Joan’s prescriptions add $650 per month to the cost of her care. Her scheduled office visits and tests are hundreds more. How does Anthem or Medical Mutual build that into her rates? Do we spread her risk to your rates and mine?

United Health Care might take Joan. The policy would exclude treatment for her most expensive conditions and insure her for anything else. The premium is $320 per month. Since the policy would qualify for a Health Savings Account (HSA), Joan could put close to $4,000 in an account, take the tax deduction, and use the money to help pay for her medications. This is not a good option. She has way too much exposure.

I know what some of you are thinking. Since Joan is coming off a group policy, she is guaranteed the right to purchase an individual policy. HIPAA to the rescue.

Federal regulation guarantees that Joan can purchase a policy designed by her state of residence. Ohio has two awful options – The Ohio Basic and Standard Plans. The Standard Plan, the better of the two, has the following benefits:
• $750 deductible
• 70% / 30% coinsurance
• $5,000 maximum out of pocket each year
• $1,000,000 lifetime maximum
• $2,500 maximum benefit each year for outpatient prescription drugs

You get the idea. This is nothing special.

The Anthem premium for this policy is $2,994.95 per month. The Golden Rule premium for this policy is only $1,323.21 per month. These are not typos.

What is the answer? Damned if I know. I agonize over the uninsured and I have spent a ton of time on Joan’s case in the last week or so. And Joan is not the only person in this predicament.

Would the “Public Option” solve Joan’s problem? Hard to say. The Ohio Standard Plan is, in essence, the state’s version of the Public Option. Would the State of Ohio create a better plan the next time around or will the policy be created by the federal government? And who pays for this?

If preexisting conditions were no longer relevant and insurers had to accept all applicants, Joan’s problems are solved at the exact same moment that your problems begin. If everyone is required to have insurance, the burden is less severe.

But today is November 11, 2009 and Joan has run our of good options. There is a real need for health care reform. The question is how to correct what doesn’t work without destroying what does.


Borrowing a Good Idea

Wednesday, October 28, 2009
A scene from the future.

Senate cloakroom. An unscheduled meeting of Senators Barbara Boxer (D-CA), Sherrod Brown (D-OH), Byron Dorgan (D-ND), Al Franken (D-WI), John Kerry (D-MA), and John Rockefeller IV (D-WV).

Dorgan: It’s not working.

Kerry: Of course it’s working. Polls show the

Dorgan: John! It’s not working. Polls? Hell John, you’ve got polls that show you won the presidency ten years ago. Barbara, you ran national commercials showing that North Dakotans were mostly covered by one health insurance company. Do you know how many we have now?

Rockefeller: Two? Three?

Dorgan: None! Your public option killed our local Blue Cross. We don’t have that many residents. We couldn’t support three or four major companies. Competition? We want our old coverage back.

Kerry: People across the country love Medicare Part E.

Franken:John, enough with that. It was fun when Olbermann came up with that. But the Republicans successfully dubbed it Medicare Edsel to seniors and Medicare Error to others.

Kerry: Nobody else calls it Medicare Part E?

All: Just you, John.

Senator Beau Biden (D-De) enters the cloakroom.

Biden: Senators.

All: Senator.

Biden: That never gets old. What’s going on?

Boxer: Byron’s unhappy with the health plan.

Dorgan: I’m unhappy? My constituents are unhappy. And you? How happy are you?

Franken:The numbers are awful. We were told that costs would go down. Happiness would go up.

Biden: Doctors still on strike in San Francisco?

Boxer: Yes, but at least most of them are back to work in Los Angeles and San Diego.

Franken:The claims are through the roof. We undercut the insurers and took their healthiest clients. Since we didn’t ask any questions or exclude any preexisting conditions, we got all of the unhealthy, too. The insurers are making money, hand over fist, selling supplements and we were left holding the bag.

Kerry: I didn’t know so many had cancer.

Boxer: Or heart trouble.

Rockefeller:Or asthma. Half the country must use inhalers.

Brown: Much of this is preventable. If we could only get people to take better care of themselves, quit smoking and drink less, we’d be OK.

Biden: Good luck with that.

Brown: Well, I’ve got an idea. I would like to initiate a trial program in Northeast Ohio. It’s based on a great idea from a few years ago. Toby Cosgrove of the Cleveland Clinic has pointed out that obesity is the root cause of much of our problem.

Boxer: Yes, we all know that obesity related claims are killing us. What’s the idea?

Brown: The Cleveland Clinic would send out three cans of Slim Fast to every household in Great Cleveland. Once people see how easy it is to lose weight, our problems will be over. And of course, since this is such a good idea, they won’t mind paying for the diet shakes.

Rockefeller:How much will it cost them?

Brown: Just $50.

Kerry: Sounds like a steal!

I hope you are reading this under the glow of a low-energy light bulb.


It's Your Turn To Pick Up The Check

Thursday, October 22, 2009
Forget free lunch. I want dinner.

I briefly touched upon rating differentials in my last blog. To recap, there were women complaining to Congress about paying higher individual health insurance premiums when they are young and, statistically, have more claims than young men. There was, of course, no mention that their rates would be less than their male counterparts when they get older. As Congress decides to invade my business, they will eventually scale back on the grandiose proclamations and actually have to start running their new insurance company.

Yes, insurance company. How will Uncle Sam Mutual operate? Will U.S.M. cover all of the services, tests, and procedures your current plan challenges? Every dread disease will have its teams of lobbyists and victims ready to testify at Congressional hearings. Congress will be the board of directors of Uncle Sam Mutual. Congress, the same group that a few years ago under Doctor Bill Frist's leadership attempted to diagnose Terri Schiavo, will be asked to make tough decisions. We're in trouble.

Let's take something easy - price. How will Uncle Sam Mutual price the product? Let's assume, to keep this simple, that there is only one policy.

The following determine premiums today:
1. Location
2. Age
3. Gender
4. Health
5. Habits

Residents of Cuyahoga County pay the highest health insurance premiums in Ohio. Our doctors and hospitals charge more, run more tests, and do more procedures. Forget New York or Los Angelas. If we just make all Ohioans pay the same premium, my son Phillip, who lives in Marietta, will have the opportunity to help lower my monthly cost. Theoretically, as my premiums go down, his will go up.

Speaking of Phil, he can really pitch in if age is no longer a factor. I turn 55 next February. Males 55-64 have high utilization. Age 55-59 is expensive. Premiums for men 60-64 can be down right unpleasant. Thirty-one year old males have premiums that reflect their few claims. Remove age as a pricing factor and my premium should plummet. Poor Phillip.

Before we go any further, let's do a numbers check. Remember, so far we are only talking about location and age IN OHIO. We aren't stacking the deck with national extremes, smokers with suspended driver's licenses, or the chronically ill.

We'll use a "Chevy". Anthem Blue Cross. $1000 deductible 80/20 policy with office visits and Rx Card.

Marietta - Male age 22 - $101.08 per month
Lakewood - Male age 62 - $506.08 per month

In the interest of fairness, we'll split the difference. Again, we are only looking at location and age. Gender, habits, and health have yet to be factored into these numbers. The average of these two rates is $303.58. Our mythical 62 year old is thrilled. Our 22 year old is not. Forced to pay way too much, he abandons the system. At 22, he can. What does that do to our price?

As thousands of young men in their early 20's abandon Uncle Sam Mutual's policy, the average age of the participants increases. The price, assuming any semblance of rational accounting, increases. Every time the price increases, it forces more young, healthy people off the policy. Our 22 year old's biggest problem is the high percentage of older people who vote.

According to President Obama, we need the public option "to keep the insurance companies honest". How? Will the government really begin to pay medical providers the higher insurance rates? Will the policy be as self-sufficient as the Post Office? Will all the promises to the pharmaceutical companies, the seniors, the sick, etc... be kept? Or is this just one more campaign to pass a piece of legislation?

We have only touched upon two of the rating factors. Gender, habits, and health can actually be bigger contributors to the cost to pay for someone's health care. That is what we are discussing, Morbidity. What does it cost to pay for YOUR care?

I'm looking forward to a great dinner. And by the way, it's your turn to pick up the check.


Free Is Too Much

Monday, October 19, 2009
I know I've asked this before, but at the risk of appearing repetitive, What is our Goal? Is it too much to ask that before we completely restructure our health care delivery system and a major portion of our economy, we take a moment and delineate our goals?

There are a few, very few, activists and members of Congress who have the goal of eliminating all private insurance. They view the current legislation as the first step towards a Canadian-style single payer system. It is easy to lump everyone suggesting proposals that might have a negative impact on my business as proponents of "Socialized Medicine". Easy, but very wrong. It is also wrong to assume that anyone not lining up behind a significant overhaul or the "Public Option" is a right-wing nut job probably on the take from the insurance industry.

So let's look for some other goals. One I keep hearing about is that we want to cover the uninsured. Sounds great to me, but before you can cover the uninsured, you have to ask who they are and why they don't have insurance.

We know that a large number of the supposed 47 million are undocumented Americans. The President's big speech put the number somewhere between 12 and 17 million. We also know that a large number are not permanently uninsured, just simply between jobs. Some high earners choose to be uninsured. My favorite was a well known doctor at Hillcrest Hospital. For all I know, he and his family may still be without insurance coverage.

Some of the uninsured have major illnesses. Some are children, eligible for Medicaid, but their parents don't know or haven't bothered to complete the process of enrollment. And many of the uninsured are the working poor. Earning less than 200 percent of the poverty level, often working one or two low wage part time jobs. These people have fallen through the cracks. It is our responsibility to help them get covered.

But there is another group. And this is the group that concerns many of us. There are people of limited means who chose not to be insured, or at least, not today. When they need coverage, due to illness, accident, or pregnancy, they expect to be welcomed like long lost friends by the insurers, doctors and hospitals.

Let me give you an example. Pamela (not her real name) works full-time for a large specialty retailer in a Greater Cleveland mall. She is a healthy single mother in her early 40's. She stopped smoking years ago. Aside from her two pregnancies and her breast implants, she has not had any hospital stays or surgeries. Her older child is on her own. Pamela's teenager is covered by her father. Pam is uninsured by choice.

Pamela's employer has an excellent group health insurance policy. The plan includes an office visit copay, Rx card, and preventive care. Why isn't Pam covered? Why won't they take her? Neither the insurer nor the employer is to blame. The employer pays the vast majority of the premium. The employee portion for this policy is $41 per paycheck, $82 per month. Pam refuses to participate. She would rather spend the money elsewhere, preferably on e-bay.

Who pays if Pamela gets sick or injured? We do. What would it take to get her to participate in the system before she is being wheeled in on a gurney? Should she be forced by implementing a tax (We are supposed to say fees. The President and Senator Baucus love fees.) on people who refuse to buy insurance? Should her employer be required to pay 100% of the premium? Should the government, which is us, just give her free insurance? Obviously the moral imperative of being personally responsible hasn't been a motivator so far.

What happens when premiums increase? There is every indication that premiums will rise with the implementation of the Baucus bill. Will Pam's coworkers drop off the coverage as their disposable income is attacked? There are a lot of Pamela's. Each of these people has a reason why his/her lifestyle is more important than insurance right up until the moment care is needed.

I want to be very clear. I am not talking about people who have lost their group coverage, can't find another job, and have a serious preexisting condition. This year's COBRA extension was only a bandage. Our system has failed too many of these people. The working poor, wage earners struggling to survive, are also not the point of this. At one point the Republicans wanted to give the working poor tax credits to buy insurance. That isn't an answer. Immediate access to Medicaid, a state run program, and an increase in funding (taxes) is the only way I know to help them.

I refuse to believe that people choose to be poor, sick, or disabled. Just as it is our responsibility to help those who can not help themselves, it is our duty to provide for ourselves and our families when we can.

So what are our goals and how are we going to achieve them?


By the way: Now that we are getting closer, it is time to assert YOUR Divine right to special consideration. On the October 15, 2009 ABC World News Tonight, Charlie Gibson reported about women testifying on Capitol Hill. The issue was that insurance companies were charging them more for health coverage than males the same age. The injustice! Of course, there was no mention that these same women would pay less than men for health insurance later in life or that their car insurance was less since the day they received their driver's licenses. And life insurance? Women's rates are always less than men's. Poor Charlie. He just didn't have the time to mention any of that.

The Two Minute Drill

Tuesday, September 29, 2009
OK, Dave. What do you think is going to happen with health care?
Have you read my blog?
When I get a chance, probably not for the last couple of weeks. Just give me the two minute version.

The two minute version? Health Care. Life and Death. 15% - 20% of our economy. And he wants this condensed to two minutes so that he can move on to more important things like Shaquille O'Neal's debut in a Cav's uniform.

Details. There are no details in the two minute version. But then again, there have been almost no details in the barrage of commercials (for or against anything), speeches, or news programs. We've got hype. We've got fear-mongering. We've got lobbyists. But details? Who has time for details?

There is a great commercial on television that stresses that the PLAN:
* Let's you choose your own doctor
* Won't penalize you for any preexisting conditions
* Keeps bureaucrats out of your health care
* Incorporates the best ideas from Democrats and Republicans
"That's reform we can all feel good about."

Sign me up!

Of course, this plan doesn't exist. Senator Baucus recently unveiled his version of health care reform. Over 500 amendments have been offered so far. Let's pretend that two thirds of those amendments are nothing more than intentional roadblocks, that still leaves over 150 substantive changes. How many of these will be adopted and how will they affect the final legislation? What you like about the bill today, may disappear tomorrow. Or vice-versa.

Details. Ask a dentist how the proposals pay for dental care. Obviously the dental community needs better lobbyists. Even Medicare Advantage policies only cover routine exams and cleanings. Medicare doesn't cover fillings, crowns, or major services now. Will the so-called public option provide this in the future? Who knows?

These same questions apply to care for mental, nervous, and emotional disorders, eye care, or even chronic conditions. Turn on the television and you've got Former Governor, Former DNC Chair Howard Dean begging for a public option. What would the public option cover? Don't ask him for details. That's not his job.

So I have an answer for the next person who wants the quick answer for What's going to happen? I am going to quote that famous philosopher, L.O. Annie who said, "The sun will come up tomorrow."


Anthony Weiner Hates Me

Monday, September 21, 2009
Before we get started - Sunday, September 13, 2009. Fourth Quarter. Brady Quinn completed a 26 yard pass to Robert Royal for a touchdown. You may be wondering what this has to do with health insurance. The Browns offense hadn't scored a regular season touchdown since last November which was driving Cleveland fans nuts. Since the President and his team have yet to discuss mental health, I want to help out where I can.

Anthony Weiner is a Congressman for New York City. He is a survivor, the kind of guy who seized the opportunities given to him and made the most of them. His story is the success side of any and all government programs designed to help people help themselves. Though I personally can't relate to his upbringing or how it continues to impact his views on the issues, I respect his accomplishments.

Anthony Weiner hates me.

Well, not exactly. We've never met and probably never will. Congressman Weiner does, however, advocate for the elimination of all health insurance companies. As the health care debate heats up, you will find Mr. Weiner on such television programs as The Rachel Maddow Show, Countdown with Keith Olbermann, and even, occasionally, on a mainstream Sunday morning program. His article Giving Single-Payer a Second Look appeared September 7, 2009 on the Huffington Post.

His message, even if slightly exaggerated, is consistent. According to Mr. Weiner, the "United States already uses single-payer systems to cover over 47% of all medical bills through Medicare, Medicaid, the Veteran's Administration, the Department of Defense, and the Bureau of Indian Affairs." He often takes time to tell us how happy everyone is under these various programs and usually includes the canard that Medicare has only 4% overhead compared to up to 30% the insurance industry has in profits and overhead.

Where do we begin? Let's start with the 47% of us on a government run single payer system that proves that insurance is unnecessary. I won't dwell on the easy stuff - the regular television expose's of underfunding, waste, and despair that describes almost anything having to do with the Bureau of Indian Affairs and the Veteran's Administration. I used to volunteer at the V.A. in University Circle, easily one of the most depressing places I've ever encountered.

To get to 47%, Congressman Weiner includes Medicaid, a collection of State run programs for the indigent that varies in quality from the almost acceptable to the down-right shameful. Underfunded even in a State like Ohio, Medicaid's beneficiaries are treated to health care reserved for those on the lowest rung of society's ladder. Women come to my office to purchase insurance in the hope of getting better care for their children even when they still qualify for Medicaid. Is that right? No! But the States, which means our elected representatives, which means us, have not shown the willingness to tax us sufficiently to provide top of the line health care for our poorest citizens. It is either a priority, or it is not.

Let's talk about Medicare. I love my children, but I know what Jennifer and Phillip can do and what they can not. I also love Medicare. Congressman Weiner is well aware that much of Medicare's overhead falls within other parts of the government's budget. He is also well aware that even though Medicare underpays medical providers, there are real funding issues and that long-term viability is in question if changes aren't made.

But there is still one issue that Congressman Weiner completely ignores. People are satisfied with Medicare because of private insurance. Senior citizens see Medicare as the combination of the government's program and their Medicare Supplement policies. Eliminate the supplements and they would be faced with the deductibles, unpaid hospital days, 20% coinsurance, and total exposure to the high cost of prescription medication. Senior citizens are very satisfied with Medicare Advantage policies, the private insurance option Mr. Weiner and the President hope to terminate. Medicare, without the supplements, without the prescription drug benefit, would have very few fans.

Anthony Weiner may hate private insurance, but his constituents still need us.


Right or Privilege

Thursday, September 3, 2009
September 2012

Welcome. Welcome. Please take a seat. My name is Bill Shnorer. Thank you again for attending this pre-rally briefing. There is a sign-in sheet in the back next to the coffee and cookies.

We have plenty of signs thanks to our friends in the U.A.W. Guys, please raise your hands. Thank you U.A.W. The signs say "It is a RIGHT not a PRIVILEGE, Equal Access For All, and Our Tax Dollars Built This System". We will make sure that each of you gets a sign as you leave this room.

Friends, we are here because we care. We are here because we have been victimized by the current system. We have seen our loved ones lose jobs and go bankrupt. We have seen factories close and jobs go overseas.

And yet, does Washington care? Is Washington listening? Our concerns have been brushed aside by the industry shills and the talking heads on TV. It is time for action. It is time for you and I and our neighbors to have the same options as our Congressmen and Senators.

There are some who would say that what we are discussing is Socialism. But I am reminded of that great American, Senator Edward Kennedy, who fought tirelessly to better the lives of all Americans. He understood that the corporate CEO is no greater than the single mother in the eyes of liberty. He understood that in a democracy, we are all equal, all are free, and all are entitled to respect.

Yes, if Teddy Kennedy was alive and here, I am sure he would tell you that all Americans have a right to high quality, affordable Transportation.

It is an outrage that even today, in this country, there are still Americans without cars. Cars take Americans to work. Cars take Americans to the doctor for needed health care. Cars take Americans to the grocery store to buy food for their children. Here we are in the richest country in the world, and yet millions of us do not have access to adequate Transportation.

How can this be? Who has forced their way in between you and your auto manufacturer of choice? Who is denying you unfettered access? We look no further than the A.D.A., the Automobile Dealers Association.

Thousands of small towns across this great nation are held hostage by one or maybe two dealers who control the market. Even here in Beachwood, Ohio, you might want to buy a Ford, but we only have a Cadillac dealership.

Some of our opponents have pointed to public transportation as a reasonable alternative. Have they been on a bus? Have they waited in the rain for the Rapid? Would our Senators ride the RTA? We want no more, and no less, than what our representatives are given in Washington. And I'm told that they have great Transportation.

We built the roads, the freeways, and the turnpikes. Our tax dollars funded the very avenues we have been prevented from enjoying.

We need CARS. And we need them NOW.

This will not cost money. It will save money. Providing automobiles to every American eliminates the need for public transportation, an incredible waste of taxpayer money. We will also save the millions of dollars blown on Dealer salaries and perks. Our friends on the West Coast dream of a day when there won't be anymore Cal Worthington ads on TV.

But this is not a money issue. This is a moral imperative. We will prevail. Americans value our rights. We value our families. And most of all, we Americans value our CARS. When we see our neighbor without a car, we know that there, but for the grace of G-d,walks us.

Grab a sign. The camera crew from Channel 8 is already outside.


Stuck Inside

Friday, August 21, 2009
I was standing, two Mondays ago, on the 16th fairway of Fowler's Mill Golf Course. I was attending the annual American Jewish Committee / N.A.A.C.P. golf outing and had just had my best drive. As if G-d, Himself, had finally seen enough bad golf, an impressive lightning bolt lit the sky. We jumped into our carts and were among the first to arrive at the clubhouse. Torrential rain and heavy winds ended any chance for further athletic embarrassment.

It was too early for dinner, so the nearly one hundred golfers and staff simply hung around and kibitzed. We probably talked more at this outing than at all of the previous ones combined. With the Indians tanking, the Cavs on vacation, and the Browns a few weeks away, health care reform was a major topic of discussion in every group of golfers.

My friend Leo asked how I would solve the problem. "What is the Cunix plan?" Oddly enough, I hadn't actually thought of one prior to his question. This is what I came up with that afternoon.

1. Health Insurance would be mandatory.
2. All preexisting conditions would be covered for anyone enrolling in the next year.
3. Medicaid is opened up to everyone earning up to 3 times the poverty rate, paid at a sliding scale.
4. The federal government would reinsure all shock claims in excess of $250,000.
5. All group and individual health policies would be revamped to reflect ten uniform options. All plans would include basic preventive care as well as dental and eye exams.
6. All medical providers would be required to update their record keeping in an effort to eliminate duplicate and wasteful testing and procedures.
7. Billing fraud would be aggressively prosecuted.
8. Hospital, doctor, and even prescription ratings would be independent and the results would be easily accessed by the public.

As I said, it was raining, we were stuck inside, and we had lots of time to kill.

I won't claim that this is a solution to all of America's health care woes. That would be impossible since we haven't, as a country, defined the issues. My eight points are my off-the-cuff conversation starters. I am not qualified to advise doctors on cost containment, so you won't see that here.

My suggestions only work as a whole, no picking and choosing. The insurers, the federal government, the states, and the providers all take a hit. Shared responsibility. Shared pain. Shared solution.

Warning: the following explains, with some detail, the above eight points. If you're really not interested, it's OK. Skip ahead to the last paragraph and we'll see you again in two weeks.

There are supposedly 45 - 50 million uninsured in America. There will always be uninsured. It has been estimated that between 10 and 12 million are illegal aliens. Millions more, like the uninsured motorist who hit me in January, simply choose to not waste their money on insurance. Health insurance must be mandatory for the system to work. We won't get everybody, but we'll get most.

The insurers would be put at risk proportionate to their market share with the elimination of both underwriting and any exclusion for preexisting conditions. Of course, there has to be a window when any currently uninsured could acquire coverage regardless of health. After that open enrollment opportunity of six to twelve months ends, uninsureds seeking coverage would be subject to a preexisting condition exclusion.

Affordability would be addressed in several ways. Medicaid, the state run program, would be made available to the working poor - men, women and children. Premiums would be on a sliding scale. The federal government would serve as a universal reinsurer. All claims in excess of $250,000 would be shifted to Washington. Private insurance would be less expensive since the risk would be more manageable.

Product design must be improved. We currently have too many choices. The consumers are confused. The providers claim it is too complicated. And the insurers waste too much money on administration. We need to simplify the product offerings. The Medicare Supplement model is worth duplicating. With input from the state insurance commissioners and the major insurers, health insurance options could be pared down to a far more manageable ten individual plans and ten group plans. The plans would be numbered 1-10 thus eliminating the confusion caused by product names. Plan 5, for example, would offer the exact same benefits whether you purchased it from Anthem, Aetna, or even, G-d forbid, the U.S. government.

By the way, all ten plans would cover basic preventive care including annual eye and dental exams. If we're going to do this, let's make sure we do it right.

I covered the importance of modernizing our record keeping and information transmission back in February. This cost would be borne by the providers. Better information will save both money and lives.

Medicare and Medicaid fraud are rampant. The president may want to stop unnecessary tonsillectomies, but over-coding and ghost patients are far more serious issues. We can no longer afford to ignore white coat crime.

We can be better consumers if we have more information. Which hospitals are better for heart surgeries? When will the generic medication be perfectly fine? Independent, accessible studies should be available for all Americans. We need the opportunity to make informed decisions about doctors, hospitals, and therapies.

Our health care conversation came to a merciful end with the arrival of a fabulous dinner catered by Blue Canyon Restaurant. Lucky for me, my invitation to this charity event is not contingent on my golf game or my conversation skills, just my willingness to write a check for a good cause. With any luck, next year will have more golfing and less health care.


From Birthers To Deathers And All Who Lie In Between

Sunday, August 9, 2009
Man, that's the second time you've mentioned that guy. He must really piss you off for you to talk about him at dinner.

Alec, my girlfriend's son, was correct. I must have been a touch agitated. I place a very high value on honesty, loyalty, and competence. Over the last couple of years I have had to deal with a number of people deficient in one or more of those qualities. One, in particular, may have pushed me a bit too far.

Lately, honesty, loyalty and competence have been in short supply in American politics. Yes, these blogs have taken issue with some of the goals of the proposals coming from the Democrats. I have certainly expressed my disdain for the President's content-free campaign. I disagree with many of Mr. Obama's assertions and proposals, but I don't, for a moment, question his motives or sincerity.

It is also possible to respectfully disagree with some of the Republican proposals and goals. There are people of good will on both sides of the issue.

Good will is not a given and civil discourse has been hard to find. It started with the so-called "Birthers", the fringe element who refuse to believe that a guy named Barack Hussein Obama could have been born in the United States. Nothing short of a time machine whisking each of them back to the Hawaiian hospital room will convince them. Easily manipulated, the Birthers were led by the usual suspects - Rush Limbaugh, Lou Dobbs, and a half dozen Republicans in Congress unashamedly pandering to the base.

The whole Birther conspiracy theory / paranoia was just an amusing side-show until a Republican Congressman lost control of a town meeting. Tapes of the event looked more like a Saturday Night Live skit than real life. The encounter quickly devolved from amusing, to pathetic, to scary. I was worried that the woman, or one of her friends, was armed.

And the Deathers may be worse. Intentionally twisting the availability of living wills and counseling for end-of life issues into a government plot to kill grandma is neither honest nor useful. Organizing mob-like assaults of public forums is a direct attack on our values.

On July 28th Virginia Foxx (R-NC) said on the House floor that the Republican plan "is pro-life because it will not put seniors in a position of being put to death by their government". Is it possible to be more counter-productive?

The tone of these town hall confrontations is discouraging. The men and women of Congress use the August recess to meet with their constituents, to learn our issues, to hear our concerns. Organized teams, schooled in the art of disrupting a meeting, prevent the honest exchange of information.

Insurance agents certainly have a stake in the outcome of this debate. Our organization, The National Association of Health Underwriters, expressed its concern in an August 7th email:
While we understand that these issues are very sensitive and it can oftentimes be frustrating to hear legislators disagree with your views, NAHU strongly discourages our members from disrupting these proceedings in anyway. It is perfectly acceptable to express your opinions politely and respectfully disagree with your legislators, if warranted. However, we don't want you to mob the town hall meetings and participate in some of the scenes we all have seen on You Tube.

I had to read that paragraph twice. At first I thought it was ridiculous that responsible adults would have to be told to behave like adults. It looked like the sign reminding restaurant employees to wash their hands. Then I realized that like those silly restroom signs, this paragraph was necessary. It was important. We, as an organization, as a profession, had to state in English, clearly, that we are participants in the discussion, not members of a mob.

Honesty. Loyalty. Competence. My frustrations as president of the Beachwood Chamber of Commerce end April 1, 2010. And the truth is that part of my problem is that I keep expecting more out of some people than they will ever want to deliver. But Honesty, Loyalty, and Competence are the least we should expect from our elected officials. Feeding conspiracy theories and playing on the darkest fears of the easily scared is not how to fix our health care system.


Choosing Sides

Sunday, July 26, 2009
Mr. Cunix? My name is xxxx and I'm calling from Shaker Hts. Your client, Mrs. xxxx, suggested that I call you.

How can I help you?

I need to know if you could connect me with some people who are employed and suffering because of their high insurance premiums.

You need me to tell you about working people who can't afford their insurance? I don't think I can.

I've got unemployed people who will complain about insurance cost, but I can't find any employed people.

Let me guess. You're trying to stock the pond?

Well, yeah, but I'm not suppose to tell anyone. If we can find the right person to tell his story, he may even get to introduce the President.

Sorry I can't help. Good Luck.

The President and his team are in full campaign mode. After the scheduled photo-op at the Cleveland Clinic, Mr. Obama was taken to the friendly confines of Shaker Hts. high school. I had already declined two invitations to Thursday's event before the above call. I had been pretty sure it was going to be more style than substance even before I was asked to help stage it.

It's a campaign and I don't want to choose sides.

Really, I don't want to choose sides. Mr. Steele and the Republicans can't find it within themselves to work for a solution. Senator DeMint (R-SC) is more interested in breaking the President than the breaks in our system. Caught, he attempted on the July 22, 2009 Today Show to say that he wants to "put the brakes" on Mr. Obama's plan. He went from Senator DeMint to Senator Disingenuous.

It's a campaign and I don't want to choose sides.

I think it is safe to say that most of us believe that change is needed. The status quo is not acceptable. Costs are spiraling out of control. Our specific goals and how we will set about achieving them should be the subjects of serious debates. But we aren't having those debates. We are having campaigns.

The President's press conference started at 8 PM Wednesday evening. I got home in time to watch him. Gosh it was so frustrating, so unsuccessful that even MSNBC had difficulty cheer leading for him in the subsequent two hours of discussion. Dr. Nancy Snyderman and Chris Matthews talked more about the questions the President ducked than the ones he answered.

Candidate, I mean President, Obama promised Wednesday:
* No preexisting condition clauses
* No additional charges if you already have a medical condition
* No mandate, no requirement for participation
* Excellent patient-centric coverage when you need it right down to a dietician preparing individualized plans for every diabetic
* No interference from some administrator sitting at a computer

The first couple of points are interesting because they may, by themselves, doom the whole process to failure. Insurance is about shared risk and responsibility. Regular readers of this blog know that I was hit by an uninsured motorist in January. We can't enforce something as basic as our mandatory car insurance regulation. If we don't even try, if we don't require health insurance coverage, many of the same uninsured now will be uninsured later. Why would they bother purchasing health insurance until after they are really sick?

Dr. Snyderman and many of us were surprised by the President's insights into the practice of medicine in the U.S. "If a blue pill and a red pill do the same thing, but the red pill costs half as much, why wouldn't you take the red pill?" He also suggested that some doctors perform tonsillectomies on children for the money.

The idea that some administrator sitting at a computer won't be involved in your health care decisions under a new public plan was debunked right there. Who makes the determination that the red pill and the blue pill are equivalent? When is one better than the other or are we to believe that the only difference is the dye? And surgeries? Who will decide which surgeries are needed and which are simply for doctor and hospital cash flow? Will all of these inspectors work for free? Our cost savings depend on their volunteer effort.

We have had one goal up to now. Our goal as Americans has been to have great access to top doctors and hospitals paid for by someone else. That's the old goal. It is time for a new goal: Great access to top doctors and hospitals that we can afford.

We don't need a campaign. We shouldn't be forced to choose sides. We need details. And we need them now.


Missed It By That Much

Monday, July 13, 2009
It was a Maxwell Smart moment.

Neal Spero politely told us that he had a plan. Dave Clark and I, with equal parts candor and respect, politely disagreed. Mr. Spero is the Senior VP of American Community Mutual, a mid-sized health insurer based in Livonia, Michigan. Dave and I have been two of American Community's top agents for most of the last twenty years. That is quite an accomplishment since we both work with dozens of insurers. The date was September 6, 2007. We had asked to meet with Mr. Spero to share our concerns.

My perception was that American Community was digging itself into a hole. I saw a problem with their new distribution system (who sells it) and their underwriting (who gets covered and at what price). Mr. Spero saw nothing but blue skies and calm seas.

I stopped writing American Community's individual policies last October. Their current renewals for their existing business, reflecting their staggering claims experience, came in at 33%. Mr. Spero had a plan. I can hear Steve Carell say "Missed it by that much".

This past week Senator Ted Kennedy (D-MA) and Senator Christopher Dodd (D-CT) announced that they are now able to project a cost for their committee's health care reform package - $611 billion dollars over the next ten years. The Health, Education, Labor and Pensions Committee (HELP, really, I can't make this stuff up) was pleased to get the cost down to $611 billion dollars even though that number doesn't include Medicaid expansions which put the price tag back over the $1 trillion mark.

I can hear Don Adams say "Missed it by that much".

Not that Senators Kennedy and Dodd know where six hundred plus billion dollars are coming from, but what if the real price tag is a trillion or so? That is a question nobody wants to answer.

There are ways for American Community to save itself. They will raise their rates, tighten their underwriting, and reassess their marketing and distribution. Or they will fail. I am not being cavalier about this. I want A.C. to succeed, but American Community is a business, not a person, not a government. A company that consistently has higher expenses than income ceases to exist.

What will the U.S. government do? One idea was to tax employer provided health care benefits, a bipartisan compromise that might have brought in a couple hundred billion. Other trial balloons floated have included a tax increase on high earners and a "sin tax" on carbonated beverages and sugary drinks.

How much Coke do we have to drink to make up a $1 trillion shortfall?

What's missing is a serious discussion of how we are paying for any of this. Discounts from hospitals? Shell games from big Pharma? Would you believe aliens with space ships full of cash? Sorry, it is just that I have been here before.

Let's all say this together, Tax Increase. It's OK. The world won't end and most of Congress will still be reelected. If having the government run health care is a good idea, say so, tell us the real price tag, and tax us appropriately. We're adults. We're citizens. Trust us with the truth.


Quick note: Dave Clark just called. I told him that he was included in this post. His only issue is that the American Community insurance pool isn't as polluted in Michigan where he lives as our's is in Ohio. He still loves them and does a lot of business with them. He pointed out that they are still one of the easiest companies to work with, do a great job paying claims, and still have guys like Neal Spero who would meet with agents like us. Duly noted.

The Real World

Monday, June 29, 2009

Those sentiments were on a bumper sticker that graced a neighbor's Volvo. This was a few years ago when I was living in Shaker Heights. The fun fact? The car's owner was a physician.

I'm pretty sure this guy didn't sell suits for a living and only practiced medicine as a volunteer. He certainly didn't accept chickens and vegetables for his services. He didn't object to being paid, and judging from his house, paid well, for his services. His objection was to anyone else profiting from the delivery of health care.

Get in line.

Depending upon who you ask
* The doctors are overpaid
* The hospitals are palaces
* The insurance companies are crooks
* The drug companies are gauging us
Heck, the only people universally loved and appreciated are us insurance agents.

Yes, I'm kidding.

My neighbor the doctor was, however, right about one thing. This debate is not about medicine or the delivery of health care. It is about money. Who pays? Whose ox is gored? Who can make a small payment today to protect a major profit center for years? One of my goals is to move our conversation to include the actual delivery of health care.

One of our problems, as a society, is our complete aversion to personal sacrifice. Our state is having a huge problem balancing its budget. Governor Strickland is looking at adding fees and slots for income. To cut expenses he is taking a hatchet to any program that isn't backed by a strong lobby.

One of the governor's budget goals includes a change in the open enrollment health insurance program. Under the Federal Health Insurance Portability and Accountability Act (HIPAA), people who have lost their health insurance after eighteen continuous months of coverage, are guaranteed the opportunity to purchase a policy. This is particularly relevant if the individual has significant preexisting conditions. In Ohio, the options are the "Ohio Basic" and the "Ohio Standard". These are over priced awful policies.

Governor Strickland wants to have these policies, sold to some of our unhealthiest citizens, capped at 1.5 times the base rate. In other words, if we lower the premiums a touch, thousands of unhealthy uninsured individuals would be able to buy insurance. Isn't this great?

Well, it depends. The Ohio Department of Insurance's actuary determined that 52,000 additional consumers would purchase coverage through the open enrollment program. The problem is that the rates for policies in the standard individual market would increase by 5.5%.

Are you willing to pay 5 1/2% more so that someone else's insurance might be cheaper? If your family policy is $500 per month, we are talking about $330 per year. Regular readers know that the equation is always the same. If you increase money out, you gotta bring more money in. So will 52,000 more people be able to afford coverage? Of course not. The rate decrease for the unhealthy people, and the small increase for the rest of us, will be phased in over several years. G-d forbid you or I should have to make a sacrifice.

The debate isn't about the delivery of health care. It is only about money. That is the real world.

If you really want to know where the money is in health care. watch TV. Not the shows, the commercials. Scooters, lift chairs, and medications that run $8 to $10 a pill dominate prime time. I can track trends just by watching the ads on the evening news.

A new commercial has me a little nervous. It features lots and lots of smiling senior citizens. The reassuring voice over tells us that the reason they are so happy is because of the money they've saved due to Medicare Part D, the Rx benefit.

Other than actors, the only senior citizens that happy about Medicare Part D are pharmaceutical company retirees. Designed to enrich and protect the drug companies, insurance companies, and certain well-connected insurance marketers (AARP comes to mind), any benefit a senior citizen gets from Medicare Part D is strictly accidental. None of the rules favor the consumer. And yet, I've got senior citizens dancing across the screen and this announcer extolling the virtues of Part D. Of course, the commercial is paid for by the pharmaceutical companies.

Coincidentally, the drug companies recently met with President Obama and have proposed an $80 billion deal. That is $80 billion dollars over ten years. $30 billion will help to pay for brand name drugs for senior citizens who fall in to the coverage gap, the notorious "doughnut hole". The other $50 billion will be used to help offset expected costs associated with the uninsured.

Are those numbers real? We'll never really know. But the drug companies think they have a deal. They will make another small, difficult to quantify sacrifice in hopes of a huge payoff. Their goal is to have health care reform to be as profitable as Medicare Part D. The $80 billion deal is strictly voluntary and depends on the enactment of a comprehensive health reform package acceptable to the industry.

Again, here in the real world, we are actually talking about money not the delivery of health care. Well if we are going to talk about money, we should all be forced to use real numbers.


Questions or suggestions for future topics?


Monday, June 15, 2009
Tenth Hole. Weymouth Country Club. Medina, Ohio. I had hit a surprisingly good drive. It was long, majestic, and in the fairway. My second shot on this par 5 was more than adequate. And now I was standing less than 100 yards from the pin, laying 2, with a sand wedge in my hand. I knew what I wanted to do. I wanted to hit that ball high into the air and have it land, AND STOP, within six feet of the hole.

I knew what I wanted to do.
I knew, theoretically, how to do it.
There was no reason not to birdie this hole. At worst - par.

Bogey - 6.

Back on the cart on my way to the next tee, I realized how much my golf game has in common with the President's health plan proposals. He knows what he wants to do. He knows, theoretically, how to do it. But we have every indication so far that he is not going to reach his goals.

The consequences of my blown shots are the loss of a couple of bucks and another hit to my fragile ego. Missing the mark on health care is far more significant.

Before we go any further, I should, in the interest of full disclosure, reveal that I voted for President Obama last November. I volunteered and donated to his campaign. I also have no regrets.

As an Obama supporter, I receive daily emails from the ongoing campaign. And yes, health care reform is being run like a campaign. On Saturday I was asked to "Stand with the President". His three core principles are:

* Reduce costs - Rising health care costs are crushing the budgets of governments, businesses, individuals and families, and they must be brought under control.
* Guarantee choice - Every American must have the freedom to choose their plan and doctor - including the choice of a public insurance option.
* Ensure quality care for all - All Americans must have quality and affordable health care.

So vague. So general. No detail on how this gets done or how much it will cost. I sent an email asking for more information. I'm not holding my breath while I wait for a detailed reply.

Joe Biden was on Meet The Press yesterday (June 14th). When asked by David Gregory how President Obama was going to pay for health care reform, Mr. Biden quickly mentioned a few cost savings measures. His second option was, "Get rid of Medicare Advantage".

Millions of senior citizens currently enjoy the benefits and convenience of Medicare Advantage policies. As we learned two weeks ago from my interview with the Cleveland Clinic manager, private health insurance pays the most to a hospital or other medical provider. Medicare Advantage plans do not cover all of the costs but are still much better than regular Medicare. Costs are SHIFTED to the people with private insurance. If the government eliminates Medicare Advantage plans, senior citizens would be forced to choose a Medicare Supplement and hospitals would get less for their services. This pushes an even larger burden on those people with private insurance.

This is not hard to understand. There is nothing counter intuitive. Money goes in. Money goes out. Checks are sent to doctors, labs and hospitals. Where is the money coming from? If those doctors, labs and hospitals are shortchanged, who picks up the balance?

The President has been talking about a public plan to compete with the insurance companies. This sounds a lot like me competing with Tiger Woods. Here are a couple of quick questions:

1. Health insurance companies are real businesses. Their books have to balance. Premiums are determined, in part, by claims and risk. What would determine our new competitor's rates?
2. Will the government continue to under-pay the medical providers? If so, will the doctors, labs and hospitals be allowed to shift the costs to those covered by private insurance? That, alone, would seal our fate.

My golf game, with a little luck and a lot more practice, will one day achieve an acceptable level of mediocrity. Health care reform is different. There will be no Mulligans. There is very little margin for error. We are racing towards an August deadline. What's the rush? Regardless of your personal position or goal, you must have questions that have yet to be addressed.

Stand up and demand answers.


The Interview

Saturday, May 30, 2009
I ran into Corky and Lenny's to grab a quick lunch to take back to my office. I ordered a pint of chicken soup, broth only, and .20 of pickled tongue, no bread. A waitress overheard my order and whispered to the deli man "He must be a doctor". So he asked me ".20? Are you a doctor?" "No", I replied. "I'm an insurance agent, but somewhere in California my mother is smiling."

OK, I'm not a doctor, but I recently had the opportunity to spend a half an hour with a high ranking manager at the Cleveland Clinic. The gentleman was familiar with Medicare reimbursements. He asked not to be identified and I will, of course, comply. Our interest is to collect information.

My first question centered on patient demographics. I was told that the Cleveland Clinic's patients were approximately:
* Private Insurance - 50%
* Medicare - 40%
* Medicaid, self-pay, and charity - 10%

Those numbers are important. Even though the government paid care accounted for less than half of all patients, I was advised that the Cleveland Clinic spent 215 million dollars last year in charity care, Medicare and Medicaid subsidies.

The Wall Street Journal reported on May 1, 2009 that the federal government planned "to keep Medicare payments to hospitals essentially flat". There is even talk that doctor's payments may be reduced. Those were two topics my new friend wouldn't touch. Even an unidentified Cleveland Clinic employee wouldn't want to appear too negative. We could discuss the general concepts of Medicare payments.

I wanted to know how the Centers of Medicare and Medicaid Services (CMS) decided how much a particular service or procedure was worth. More importantly, why wasn't it enough?

What he explained is that CMS determines a cost for a region. Though a teaching hospital is paid slightly higher, but not nearly enough to cover the extra expenses, CMS doesn't recognize the "difference between Bedford Community Hospital and the Cleveland Clinic". And there is a difference. Doctors, training, technology - someone has to pay for all of that. Those costs are shifted to the patients with private insurance.

There is a hierarchy of payments:
* Private Insurance pays more than
* Medicare Advantage pays more than
* Medicare pays more than
* Medicaid.

Medicare Advantage, which provides better care,is reimbursed at a higher rate. Medicare pays less than 50 cents on the dollar. Again, where does the money come from?

My last question, as his secretary was dragging him to his next meeting, was "Who pays if there isn't private insurance to cover the balance?"

We're meeting at P F Chang's this week to discuss this further.



Monday, May 18, 2009
I used to smoke two packs of cigarettes a day. Some days I also indulged in a cigar or one of my pipes. I enjoyed smoking. This was at a time when smoking was permissible everywhere- work, restaurants, even while shopping. I found it calming. I would inhale deeply, especially from my beautiful natural burl pipes, and use those moments to center myself. Smoking was therapeutic. Smoking was a hobby. And, smoking was unhealthy.

We knew. I may have been in my late twenties, but I knew that smoking was a health risk. My father was smoking unfiltered Pell Mell cigarettes. He was addicted. There was no joy, no peace. He had a habit, a cough, and eventually a cancer that would cause great pain and death. I knew that I could end up just like him if I wasn't careful.

I also knew my triggers, the times or circumstances that caused me to reach for my cigs and a lighter. One of my most consistent triggers, something that would always force me to reflexively light a cigarette, was any commercial from the American Cancer Society. Their anti-smoking commercials drove my smoking.

I haven't determined whether it was the tone, the content, or simply the point of view, but to this day the American Cancer Society has this hugely negative impact on me. I stopped smoking cigarettes on January 1, 1985. I still avoid their commercials.

We are knee deep in the national health care discussion. As a life long Democrat who has served on numerous campaigns, I am well aware of one side of the debate. As a thirty year plus veteran of the insurance industry, I live the other side. The American public, addicted to open unfettered access to medical care largely paid for by someone else, is interested in the discussion, but not the commercials.

The strident, polarizing messages issued from both camps, parked conveniently on the extremes, do nothing to illuminate the issues. Chrysler didn't fail because of our health care system. Conversely, Canadians are generally pleased with their access to health care. There is a grain of truth buried within the ads from both the unions and the insurance agents. Will the American public patiently sift through the propaganda to find that truth.

There are people of good will on all sides of the health care debate. There are doctors desperately trying to balance patient and business needs. Insurance agents are intimately aware of our clients' desire for affordable comprehensive insurance and the competing challenge to finance the care. There are thoughtful government employees and elected officials whose only goal is to help the American public. And there are labor leaders and business owners convinced that one option or the another would be the best for their members or employees.

Where are these people of good will? You won't find them on the talk shows. Reasoned debate is not good TV. In fact, if television is your primary source for news and information, the only thing you know for sure is that there is a huge conflict and that eventually one side will win and one side will lose. And that's just not true. We can all lose. That would be easy. We can do nothing and let cost and access spin out of control. Or we can over-reach and ignore our strengths.
Can we all win? That should be our goal and it won't be easy.

This blog is an invitation to participate in the discussion. When those commercials come on your set, when the talking heads work harder to drown out the opposition than to advance understanding, when you feel like I did when I watched the anti-smoking ads on my television so long ago, don't shut down. Participate.

Our goals should be common ground and mutual success. What is in the best interest on the American people? How do we get there?


Quick addendum: I got stuck for two hours at a presentation by Stuart Browning, the Michael Moore wanna be from the other side. Full disclosure - I walked out before it was over. Still, I want to expose my readers to as much info as possible. Michael Moore's website is Stuart Browning can be found at He is known for his 6 minute movie A Short Course On Brain Surgery

Getting Directions

Saturday, May 2, 2009
Avenue or Street? Name or Number? Four quick details and you can find your way around in Phoenix in minutes. Numbered roads run north and south. If that numbered road is also a street, such as 24th Street, then it is on the east side of town. 19th Avenue is on the west side. Indian School Road runs east and west. A perfect grid, Phoenix is easy to navigate.

Have you ever tried to explain how to get from Westlake to University Heights?

The Phoenix grid was designed first. The city of Phoenix was built within that framework. Greater Cleveland is very different. Our communities are linked by our roads. Our street system, with its twists and turns, traffic circles, and five point intersections, is organic, reactive, and responsive. New Brainard Road quickly comes to mind.

I think about our lack of north - south streets and the joy of an efficient grid every time I am stuck in traffic on Richmond Road. We have all dreamed of a better way to get around town. We just have to decide which neighborhoods to bulldoze.

Creating a health care delivery system where none existed is a lot like planning a city's grid. With limited expectations and little to disrupt, the new program would face little opposition.

Think about the delivery and payment of health care in the US. Our system is organic and ever changing. Part action, part reaction, we have evolved from a system of community hospitals and doctor/entrepreneurs to regional medical centers who employ entire teams of professionals.

Just as the medical providers have changed, so too have the payers. Blue Cross and Blue Shield associations were originally created by doctors and hospitals as a means for the patients to prepay for medical services. Health insurance quickly followed. Over the last seventy years we've moved from indemnity policies to Health Maintenance Organizations (HMO), Preferred Provider Organizations (PPO), and even the occasional Point of Service Plan (POS). Insurers now research everything from the most efficient ways to deliver health care to drug interaction and disease management.

Medicare brought the federal government into our system. Almost overnight, Washington went from uninvolved to a key player. Medicare pays the majority of the cost for the care of our elderly and infirm. The government decides how much it will pay for a doctor's exam,test, or hospital stay. Less than the insurance companies, less than the self-pay, government payments are accept or reject. The medical provider either accepts Medicare and its rules, its limitations, and its millions of beneficiaries, or he/she doesn't. Most providers accept Medicare.

Providers, insurers, and governmental changes have significantly impacted the way health care is practiced in this country. In many ways we have lost sight of who pays for medical services.

There are commercials on TV for diabetic testing devices, lift chairs. and scooters that are FREE if you are on Medicare. They aren't free. We are paying, probably over-paying, for all of this.

Like a drive down Van Aken Boulevard, Congress is discovering that our health care delivery system isn't a simple north-south or east-west. The New York Times reported on April 26, 2009 that the shortage of primary care physicians is just one more unanticipated obstacle on the path of change. Our current system rewards specialists. A revenue neutral option would lower the reimbursements for specialists, freeing up money for the general practitioners. Needless to say, the orthopedic surgeons are not happy.

Action and reaction. Raise compensation? Add more doctors? The one thing most of us know for sure is that we can't tear down our existing system and start over from scratch. So as we debate change and what the final results will be, we must be certain that we don't neglect to map the road from where we are to that final goal.


Questions or suggestions for future topics?

Target Practice

Saturday, April 18, 2009
"I want to know what President Obama is going to do about this!"

The client was in full rant. I was seated in front of his cluttered desk. He was too agitated to sit. His Anthem Blue Cross policy, scheduled to renew in May, had taken a significant premium increase. Bill Jones (name changed to keep the attorneys impoverished) wanted me to know how unhappy he was with me, Anthem, and the entire system.

I've been doing this for thirty years. This isn't the first time I have been used for target practice. There are times you just have to let the clients vent.

What made this unusual is that Bill Jones is a licensed insurance agent! He has twenty-five successful years in the business. Even though he specializes in life insurance and investments, Bill still sells five to ten health policies each year. He knows the rules. He understands the concepts. He is a true believer, just as long as we are talking about your money and not his.

Fairness is the key issue of the health care debate. The question is always the same. Is this solution fair to me? We don't want to pay for someone else's claims, but we demand to be part of a pool, hopefully a really big pool, if we have problems.

Health policies, especially small group policies, are underwritten during the application process. The renewals reflect, in part, the group's claims experience. In part, but no where near in total. Still, unhealthy groups pay more than healthy ones. I've had clients tell me that the insurance company shouldn't penalize them just because they have had a triple by-pass, or cancer, or a three month stay at Hazelton, 0r... You get the idea. They are nice people. Money spent on their health care by the insurance companies isn't like money spent on someone else's care.

Let's look at Mr. Jones' company. Officially, the business consists of Bill and one employee. In truth, we are insuring Bill, his wife, and two kids. They take 15 prescription medications. That number increases during allergy season. Some of these prescriptions may be inexpensive generics, but even if all of the medications were cheap, think about the medical conditions these four people must have. Plus, there are a large number of office visits, lab tests and x-rays to diagnose and treat these maladies.

Given the opportunity to insure Mr. Jones and his business, Medical Mutual of Ohio, Aetna, and other companies were hundreds of dollars per month higher than the current carrier. So he will stay with Anthem.

But is it Fair? Depends. Once he cools down, and before he reads this, Mr. Jones may decide that he is getting a fair price. He is getting more in benefit than he is paying in premium. If you are a fellow Anthem policyholder, you might think that it is unfair that you are being forced to subsidize his family's coverage.

Rate increases are proof that insurance companies are doing their job. If costs increase, and they are, then premiums must also increase. That is a tad simplistic, but you get the point. If, or when, the government controls health care, will premiums increase uniformly as cost increase? If not, then the system will spiral towards bankruptcy until someone has the courage to raise premiums (TAXES) to cover escalating costs.

Some day in the future, when the cost of your health insurance increases, will you complain to your agent, your congressional representative, or the President? Which one will come to your office to listen to you vent?