THERE IS NO RELIEF IN SITE FOR WHAT MANY BUSINESSES AND CONSUMERS CALL THEIR TOP CONCERN…THE RISING COST OF HEALTH INSURANCE. THE STATE’S LARGEST HEALTH INSURERS SAY PREMIUMS WILL RISE
The state’s dominant insurer, Blue Cross Blue Shield is telling employers to expect a 9-13% increase. They say high health care costs are fueled by a variety of factors including more aging patients who seek more care that is more sophisticated and more expensive. But repeated premium increases mean that many employers have seen the cost of providing health insurance almost double in the last 7 or 8 years. Senior Vice President for Sales and Client Relationships, Tim O’Brien says Blue Cross is trying to help employers with options for less expensive insurance.
“Employers view affordability of health care as their no. one priority and we view it as our no. one priority to work on a multi-phased approach to offset the rate of increased health care costs, but it’s formidable.”
Tufts Health Plan claims it will have the smallest, on average, increases at 8%. Brian Pagliaro, senior VP for Sales and Client Services, says Tufts has the best record for helping members manage care.
“Tufts Health plan has the lowest medical and prescription drug trend in the market and therefore we’re able to provide a lower premium to our members. “
Fallon Community Health Plan declined comment on it’s expected premium increases…saying talks with employers about their rates are on-going. Harvard Pilgrim projects a 6-12% rise in the price of health insurance. Senior VP of Sales and marketing, Vincent Capozzi says the key factor is what Harvard spends to contract with large, merged hospital and physician groups.
“The consumers want to have a very broad network to chose from, and we don’t have the same negotiating power we once did when you could look at the landscape and say, we don’t need to have this piece of the delivery system in our network.  So that doesn’t give us a lot of leverage at this point.”
Physicians and hospitals argue that their reimbursement is on par with national averages. The cost of health insurance is historically, higher in Massachusetts than elsewhere in the country…because plans here are typically more generous. All of the top insurers offer some cheaper plans… that either limit where patients can get care or have high deductibles. Consumers are not flocking to these options and employers, for the most part, are still offering more comprehensive coverage. But Phil Edmundson,  CEO of the insurance broker, William Gallagher Associates, says its too early to say how employers will react to another round of premium hikes.
“The message right now is do employers want to take a more aggressive stand with their employees to try and manage the usage of health care. Most are reluctant and thus the conundrum.”
The state…through the Group Insurance Commission, has consistently held premiums to about half the rate of increase private employers pay. Executive Director Dolores Mitchell says one reason is that the GIC sets limits on where and how members get care. But Mitchell, who is also on the council established to help the state control health care costs, says it’s time to make providers more accountable for their costs.
“I do not see that simply saying it’s the patient’s fault if they don’t get better or it’s the patients fault that they don’t get better. I think we’ve got to look at the whole system and it’s government and the purchasers role to work with the provider community to deliver more efficiently the services that people need and want.”
The state’s top insurers say they aren’t sure how much rates will rise for the new insurance products created under the state’s mandatory health coverage law. But any increase will expand the group of people who can’t afford insurance and are therefore exempt from the requirement. Supporters of the law still say the covering more of the uninsured will eventually reduce health care costs and premiums…but there is no evidence of that yet.
This story highlights the inherent flaws in the private insurance system, which the new law has failed to change. We, whether as patients, employers, parents, or physicians, are still held hostage by private insurers whose true interest is not our health but their bottom line. Employers who really want to control costs should be advocating universal single payer health care.
Good for Martha Bebinger for questioning the assertion that Chapter 58 will “eventually reduce health care costs.” Go further and challenge the paradigm that rising costs are the patients’ fault, rather than the system’s.
As Ms. Miel correctly points out, private insurance is a major part of the problem in attaining affordable health care. Chapter 58, in addition to being punitive, is unsustainable. I am also amazed that business leaders have not yet seen the wisdom of moving to a truly universal national health care system that would free them from the burden of providing health insurance to employees and greatly reduce the administrative costs of care delivery. We currently spend almost twice what other nations do on health care, largely because our fragmented system of private insurance is the least efficient means possible to deliver it. The U.S. can do better.
I wish premiums were rising only 9-13%. For my business, the increase is over 26% as I’ve described on the Health Business Blog: http://www.healthbusinessblog.com/?p=1355
Universal health insurance is dead if this trend continues.
Dear Mr. Williams, Ms Bebinger and ALL READERS,
>Did you know that on top of the insurance premium and whatever rate increase there is a 4% state fee taken out of the premiums paid by people who sign up through the Connector for coverage?
>> It’s in the law – look it up.
Well, let’s see – When you pay for the insurance, the state takes 4%, then the insurance company takes 10 plus %, then your provider’s administrative cost is 30 plus %. So that leaves something like 50% of your hard-earned premium money for actual care.
>Did you know that anyone signing up for a Connector plan, even though they may be paying hundreds in monthly premiums, must sign an aplication that says:
“I understand that if I am aged 55 or older, after I die, Masshealth may be able to get back money from my estate.
I understand that if I or any members of my family are in an accident, or are injured in some other way, and get money from a third party because of that accident or injury, we will need to use that money to repay Masshealth for certain medical services provided, as explained in the Masshealth member booklet.
I also understand that I must tell Masshealth in writing, within 10 days, if I file any insurance claim or lawsuit because of an accident or injury to me or a family member applying for benefits.
I understand that if I or any members of my family are members of Commonwealth Care and we are in an accident, or injured in some other way, and get money from a third party because of that accident or injury, we may need to use that money to repay the Connector or my current health insurer for certain medical services provided, as explained in the Masshealth member booklet.”
>> It’s in the application – look it up: http://www.mass.gov/?pageID=eohhs2terminal&L=5&L0=Home&L1=Consumer&L2=Insurance+(including+MassHealth)&L3=Apply+for+MassHealth+Coverage&L4=Application+Information+Overview&sid=Eeohhs2&b=terminalcontent&f=masshealth_consumer_applicant_application_estaterecovery&csid=Eeohhs2 and http://www.mass.gov/Eeohhs2/docs/masshealth/appforms/mbr.pdf .
>Did you know just how indviduals and employers will be very heavilly penalized (and can be prosecuted) for late or missing payments.
“Such enforcement mechanism may include assessment of interest on the unpaid liability at a rate not to exceed an annual percentage rate of 18 per cent and late fees or penalties at a rate not to exceed 5 per cent per month.”
>> It’s in the law – look it up.
These are just some of the ways that the citizens and employer payers are taking it up the keester in order to comply.
So, when you say, “Universal health insurance is dead if this trend continues.”, please do not think that this is or ever was “universal” or is a favor to anyone but the insurance industry and a select group of upwardly mobile politicians.
Please look deeper than what they are telling you and SPREAD THE WORD.
“Beth Vance posted:
Comment posted September 3rd, 2007 at 7:14 am
Dear Mr. Williams, Ms Bebinger and ALL READERS,
>Did you know that on top of the insurance premium and whatever rate increase there is a 4% state fee taken out of the premiums paid by people who sign up through the Connector for coverage?
>> It’s in the law – look it up.
Well, let’s see – When you pay for the insurance, the state takes 4%, then the insurance company takes 10 plus %, then your provider’s administrative cost is 30 plus %. So that leaves something like 50% of your hard-earned premium money for actual care.
>Did you know that anyone signing up for a Connector plan, even though they may be paying hundreds in monthly premiums, must sign an aplication that says:
“I understand that if I am aged 55 or older, after I die, Masshealth may be able to get back money from my estate.
more…”
Great points Beth! I like your questions and answers a lot better than Nancy’s.
Chapter 58 has to be one of the biggest con-jobs on the people of Mass. in the history of the Commonwealth.
I am still in shock that the State lawmakers and the Governor are doing this to their own citizens! The reality is the State makes a LAW that makes taking our property legal. We all say NOTHING! Where is the outrage? Why doesn’t the Governor even speak out about this awful problem? Where is it okay for the State lawmakers to make laws that will ruin our State?
[...] another reaction, more locally based. According to Martha Bebinger’s WBUR Blog, premium increases by the major Massachusetts plans will be up 6-13 percent over the coming year. [...]
Hopefully they can see this human side of this so maybe things can be diffrent.
If only 6 percent of MA residents are uninsured, perhaps the reason Deval Patrick hasn’t attempted to do anything about this heinous law and policy along with the other powerbrokers who support and promote it as they count their money all the way to the bank could be that we are merely collateral damage in their big picture.
By the way, the latest figure per the census bureau is 10.3 percent uninsured in MA as of 2006 or 653,000. Interesting how the Connector is low balling it using figures of 350,000 to 400,000. Perhaps this is part of their victory propaganda?
As of July 1, 2007, per a presentation given by Jon Kingsdale, 175,000 residents were enrolled in Connector plans – 105,000 in Care; 70,000 in Choice. I asked him to break the 105,000 out into how many in the $0 premium plans vs plans 2, 3 and 4. His answer: 80 percent/20 percent respectively. Doesn’t sound good to me, escpecially since they are counting on enrollees footing part of the bill.
By the way, at that same presentation, Mr. Kingsdale proclaimed “off the record” that he supports single payer and would love to have it, however, the reason it was never established was the AMA’s objections years ago. While the meeting wasn’t videotaped, about twenty to thirty people witnessed his statement.
I’d like answers to the following:
What he is doing to act on behalf of his support of single payer?
Please explain the difference between single payer and Chapter 58.
How is he educating politicians and the public about single payer?
Since he knows that many people won’t be adequately covered under Chapter 58, why isn’t he working with us to further single payer?
Single payer healthcare is beyond dumb. I cannot believe the clamoring for government run healthcare has become this vocal. There are more CT scanners in Massachusetts than there are in all of Canada. Need a CT in the US? You can often have it done same day. In Canada? Hope you have a few weeks or months…
It also amazes me the way that American citizens are just willing to throw the pharmaceutical industry under the bus. Our market-driven healthcare model encourages the production of newer and better drugs. There is a reason the United States dominates healthcare innovation like no other industry on earth: there is a profit motive in it for pharmaceutical companies.
If you have the government start levying price controls, you’re going to see several things:
1) Lower quality of care
2) Less medical innovation
3) Slower delivery of service
4) More apathetic healthcare systems.
Simply step into a VA Hospital and tell me that’s how you want your healthcare to be delivered.
Government mucks EVERYTHING up given the chance.
CMartel2 posted:
Comment posted September 14th, 2007 at 2:47 am
“It also amazes me the way that American citizens are just willing to throw the pharmaceutical industry under the bus. Our market-driven healthcare model encourages the production of newer and better drugs. There is a reason the United States dominates healthcare innovation like no other industry on earth: there is a profit motive in it for pharmaceutical companies.”
I hate to tell you this but you’ve been misinformed, drug companies depend on taxpayer money to survive in the tune of billions, not to mention laws they bought to control the market.
“People who don’t read newspapers are uninformed, people who read newspapers are misinformed.”
Mark Twain
CMartel2:
Among the many reasons that healthcare is so expensive in the U.S. is the fact that we have too many CT scanners and other high tech gadgets. Many of these devices are over-utilized in the practice of “defensive medicine”, as physicians try to ward off malpractice lawsuits by ordering expensive tests that really contribute very little to diagnosis or treatment. Many minor medical conditions will spontaneously resolve themselves with no intervention. However, doctors have ceased to trust their clinical judgments unless they have several costly diagnostic exams to back them up.
You are also expressing a fundamental misconception regarding single payer systems. With the exceptions of a few truly Socialist systems (Cuba, the U.K.), the government does not run health care, it simply eliminates the profit driven private insurers by collecting monies and paying for services, thus reducing administrative costs and achieving economies of scale. The problems at Walter Reed are largely attributable to the outsourcing of maintenance to private entities and the fact that VA system is undercapitalized. The only alternating to a single payer system is the preservation of the status quo, a failed patchwork of private insurances that continues to consume a growing percentage of the GDP and denies access to services to around 46 million Americans.