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FEATURE NEWS | |
OWN A “PRIVATE PAY” HEALTH INSURANCE POLICY?
Get ready to be hammered like
a crash test dummy.
News, analysis, opinion
September 08, 2010
 Marchers in 2009 demanding health care reform.  Wash State health insurance rate increases for the "private pay" market. CLICK TO ENLARGE  It's good to be in the health insurace business. CLICK TO ENLARGE  August 2010 state insurance commisioner's office letter to consumers. CLICK TO ENLARGE AND READ
Your family has been hammered hard. A job has been lost. There’s not much money in the house these days.
You are doing what you can to hang on, to keep body and soul together.
You have either already gone through your savings or are halfway there (assuming you had any savings).
Maybe you have already started pilfering your retirement plan funds to keep a roof overhead, if you were lucky enough to have one of those.
And because the breadwinner in your house – the one who had that precious-as-gold employer provided health insurance plan for the family – lost the insurance when he or she lost the job you have had to go out on the spiffy “free market” and buy a “private pay” health insurance policy.
That is, if you could afford to buy one.
Nuclear sticker shock blows many would be buyers right out of the market at the get-go.
Thus many people end up going “naked” in order to put food on the table, heat in the house and clothes on the kids. Meaning no health insurance. They live in fear of getting sick.
Welcome – perhaps for the first time in your adult life - to the real world of capitalism.
THE BIG SURPRISE
You were stunned – particularly if you were a former government employee with those cradle to grave benefits - at how expensive this private pay health insurance was in the “free market” of “competition” and how many things that private pay insurance did not cover when compared to your spouse’s former employer provided plan.
“My God, the expensive co-pays, the huge deductibles, the expensive monthly premiums” you said to yourself under your breath. “Who can afford this stuff?”
“If this is the great free market, why are there no low cost, high value providers?” you asked.
“Where are all the upstart young companies (working out of an old house like Craigslist does) that don’t need the high overhead costs of the majors, coming
along to beat the stuffing out of them on price?” you wondered.
Is there no such thing as a competitive free market? Is that a myth?
Hard as you looked you could not find a tiny upstart, low-cost health insurance company working out of cheap digs, not paying movie star salaries to CEO’s, using old computers and fax machines and passing all those savings on to customers.
Surprise! That company does not exist, you found out. One more myth shattered.
You never knew before – but you certainly know now – that anyone who is not covered by a group employer plan in this country is a second -- no make that a third class citizen as far as health insurance companies go.
AND NOW YOU GET IT
Now you get it. Now you understand what people have been saying about the health insurance nightmare for years.
For in America, unlike every other modern nation on earth, it is not about whether you, your child, your husband, grandmother or cousin needs access to affordable health care when you are sick or even sick enough to be dying.
It is not about keeping you or anyone in your family healthy so you can remain a productive member of society, as it is in other modern countries.
It is not about keeping you out of bankruptcy as it is in say England, Sweden, Denmark or Germany.
That is not part of the equation at all. You’ve been living under a warm, wonderful delusion all these years you find out now.
The American for-profit health insurance game is all about whether big corporations can make money off you, your illness (or lack thereof) and/or your desperation to have that health insurance policy at all costs.
You are simply a dollar sign, no matter how sick you’re child is right now or how sick you are or are about to be.
If you want someone who cares about all that sentimental stuff - about people suffering and dying and being hopeless - go buy a dog.
He’ll sit in your lap all doe-eyed and fawning sweetly at you while you weep crocodile tears that turn into rivers of blue sorrow.
After all, this is the same industry that created the once secret practice of “recission.”
RECISSION: IT MAKES FOR A HAPPY INSURANCE COMPANY WORKPLACE
Recission was/is the practice of dropping health insurance coverage on a policyholder at a critical time for many ill people, in order for health insurance companies to boost profits. It’s a cute trick. Quite ingenious, actually.
An insurance drone would carefully go through every piece of health information about you going back years and years – every record about you from every doctor’s office every hospital every consultation with a voodoo witch doctor in New Orleans you ever had - and if, along the way, you or your doctor failed to dot an “I” or cross a “T” then boom!
Grounds to cancel your coverage right in the middle of those cancer chemo treatments Bobby.
Hell, they even cancelled coverage on people whose doctors wrote something in their charts they knew nothing about!
It was (is?) a common, industry wide practice as testified to by three large HMO executives before the U.S. Congress a year or so ago.
They liked it. The practice served stockholders well. The CEO’s refused to tell congress they would stop it. Good for business, that recission thing.
For an eye opener about what this game is really about go get a transcript of those congressional sessions.
Or just go buy the dog. In fact, the dog is probably a better buy. He or she will be much less depressing that reading those transcripts.
IN PRACTICE: HEALTH CARE RATIONING AT ITS FINEST
Over the years perhaps millions of Americans have been subjected to this cruel health care rationing by HMO’s and insurance companies who ruled on procedures they will cover and when – not a family doctor - and denying Americans insurance coverage when they become seriously ill, often at a time in their lives when they need coverage most desperately.
This is one of the many ways that health insurance companies CEO’s become wealthy beyond imagination.
At one point a year or so ago it was revealed that United Healthcare, Inc., CEO Stephen Hemsley, and other CEO’s in similar for-profit companies, had something to lose if Congress passed any real health care reform.
The producers of a documentary on the health care business estimated that, in the case of Hemsley, he held at one point almost THREE QUARTERS OF A BILLION DOLLARS IN STOCK OPTIONS.
That is Billions with a “B”.
CHECK THE 2009 MONEY CHART OF INSURANCE COMPANY CEO’S AT UPPER RIGHT. Click to enlarge.
But now you know all that, when you did not know it before. Before you were but a babe in momma's arms.
Before - when covered by that employer plan you thought you would always have - you were blissfully unaware there was any problem with health care at all in this country.
You said to yourself many times, “what health insurance problem are people talking about anyways?”
Now you feel like a fool for being so blind to what was happening all around you.
And here you are, about to be brutalized (again) by a game you never thought you’d be on the wrong side of.
WHAT IS COMING NOW FOR YOU AND YOUR FAMILY
You are now just another pawn to be shuffled about on the for-profit health insurance board because big fat rate increases are coming soon for you and many others like you who are unlucky enough in our state to have those private pay, individual health-insurance policies in the worst of times – the Great Recession.
And there is not a thing you can do about it Wanda and Billy and Bobby Ray and Fay but keep paying the freight or drop your policy. You are caught in the Classic “Catch-22” as Joseph Heller would say.
Now you know one of the reasons why a ton of money was spent to defeat meaningful health care reform and to scare the behoozits out of Americans that it was some sort of socialist plot.
Many insurance companies offering individual private pay policies in Washington State have asked for, and have been granted, big fat rate increases in the middle of this Great Recession that go into effect October 1st.
Other companies have already hit their policyholders with rate increases.
Regence Blue Shield for example: its private pay policies will jump an average of 16.4% in October.
Put another way, if two people in your house were insured under private pay for premiums that cost $800 a month for two (not at all unusual in the private pay market) your monthly tab just went up to $932 a month if your increase is that 16.4% -- in other words, an even more expensive Mercedes payment every month but no Mercedes sitting in the driveway.
Hey, is this a great country or what? You get to pay for a Mercedes every month but the CEO, CFO and all the other “O’s” at the insurance company office get to own and drive it!
You could look at this way. It’s a nice, slick transfer of wealth deal. Just like that oil embargo in the 1970’s.
And it gets better. Asuris Northwest Health, a Regence subsidiary, will pop with an increase of 23.7 percent. Too bad for you if you have that one because you’re $800 a month plan just went up to a few bucks shy of $1,000 a month.
Tough luck lady. Maybe you’ll have to cut back on that hamburger you’ve been feeding the family for dinner and have sawdust mixed with oatmeal instead.
You could flavor it with beef bullion. No one will know the difference.
Group Health Co-op raised rates some 8.2% in July and it’s newer plan Group Health Options hit private pay customers with a 22% increase in the same month.
In March of this year Regence BC BS Oregon hit its customers with a 15.4% jump in rates. In May KPS Health Plans had a rate increase in the private pay market averaging 17.6%.
CLICK THE RATE INCREASE CHART AT UPPER RIGHT TO EXPAND AND READ. Chart provided by the Wash. State Insurance Commissioner’s office.
Don’t like what you see? Tough. Go purchase a dog. One with a big waggy tail and nice smile.
Remember, Americans did not want health insurance reform. That was socialism.
And this rate increase stuff at this God awful time for many Americans is all proper and legal in the Great Recession because well, gosh darn it’s the free market at work.
THE FREE MARKET: THE BEST THERE IS IN THE WHOLE GOLLY-WOLLY WORLD
The insurance companies are losing money on you lousy private pay guys (Regents claims it lost $6.5 Mill last year on you clowns) because, well, you’re older for the most part and you’re at that stage in life when you get things like cancer, heart attacks, heart disease, ingrown toe nails and other stuff and well, gosh, they’d make more money if you just weren’t in the picture see?
Even though you are millions of people strong across the country, you are not part of the 85% of the country that gets that swell employer provided insurance that the insurance companies really want.
That is why eventually many private pays drop their policies as they get older because the insurance companies keep ratcheting costs way up and driving benefits way down to the point many cannot afford it any longer.
That’s the game as you private pay schmcuks - you dead weights on the economy - get older. How do you like it?
Here is part of a letter the insurance commissioner’s office is sending out to the many outraged consumers who’ve been calling and writing about this:
“We certainly understand your frustration over the rising cost of health insurance and share your concerns over the lack of affordable health care. We’ve heard from many consumers upset about the rising costs in their healthcare plan.
We tried for several years to regain our authority over individual rates – we were successful in2008. (It was lost by Kreidler’s predecessor in 2000).
Unfortunately, our authority is very limited – we had wanted the authority to look at a company’s surplus and to create a public process – but there wasn’t enough legislative support.
Now, we do a careful review of the company’s rate filing, but if they can actuarially justify the change, we must accept it.
Regence lost $6.5 million last year in the individual market and because of this, could justify an average rate increase of 16.4%. Even with this increase, the company is expected to lose $15.2 million next year.
The current rate change is based on several factors, including medical costs and the amount it’s paying out in claims compared to the premium it’s collecting – it is not due to health reform.
If your rate increase is above 16.4% it’s likely that you or someone in your family covered by the plan jumped into the next 5 year-age band.
There are some new consumer protections taking effect this fall, but the major elements of health reform don’t start until 2014."
To read the full letter CLICK THE LAST ICON AT UPPER RIGHT >>>>
Oh. And the reason the insurance commissioner’s office cannot do squat for you private pay folks is because your legislature (at work) decided to make that office impotent.
All the insurance companies have to do is send in a bunch of black box numbers (that you the consumer BY LAW will never see and can never check to see if they are complete nonsense and hot air), numbers that the industry says “proves” they are "losing money" on your sorry butts and the IC’s office by law has to give them a rate increase.
Period. End of story. No transparency. No checking to see how they might be padding the numbers (fat cat bonuses, payments to sale agents that may be out of line, trips to Vegas for an industry “conference” here and there, etc.
See, when you were working everyday for a living, the insurance industry lobby was down in Olympia every freaking hour of every freaking day hanging with the guys and gals that are supposed to be representing you.
Why, those lobbyists are now just like…well...just like family to your lawmakers in Olympia!
You know the game. In Hollywood if a movie studio wants to show a movie losing money it is quite simple to do and it is all legal. This is what CPA’s are for.
That is the system your legislature at work saddled the insurance commissioner’s office with.
That office has to take the numbers the movie studios (e.g., insurance companies) hand them, gobble them up like Cheetos and spit them out as an “Okay guys, you can have that rate increase! Now who luvs ya baby!? Oh. And here's a free lead pipe to beat those useless "private pay" punks senseless with when they get out of line."
Well Spunky, you can always console yourself at night as the dog looks lovingly into your eyes by chanting this mantra over and over:
"Thank God it’s not socialism! Thank God it’s not socialism!”
God forbid you should have that socialistic health care.
OH YEAH. THAT SOCIALISM THING. THERE’S A CATCH-22 THERE
Gosh we forgot to mention. Did you know that all your congressmen and women back in Washington DC, and all their staffers and aids who work for them and…well everybody back there that is part of government - ALL government employees - own the best socialized health care money can buy?
Actually, the best YOUR MONEY can buy. Is that too rich or what?
You see your collective tax dollars gives them a pretty sweet socialist health plan. That’s what socialism is. You take collective dollars and you spread them out to give other people stuff.
Well sir, you’ve given them the best socialist health plan YOUR MONEY can buy!
In fact, because most public employees are unionized these days - and most private sector employees are not - the odds makers will tell you that those public employee health plans that you are paying for are a far better deal than YOU well ever get in private industry. Is that a hoot or what?
So you folks working those 32 hours a week for low pay and no health plan (no benees at all in some cases) at some big box store (we won't mention any names) well you can rejoice in the fact that you are certainly taking care of the health needs - with YOUR tax dollars - of the many fine public employees and all their family members across the fruited plains of this great nation.
Don't you feel better now?
The downside is your tax dollars can't buy YOU or your family the same great socialist health care plan.
Why?
Well, because that would be socialism.
Doesn’t make sense you say?
Tough beans Buckaroo.
If you want something that makes sense, go buy a dog.
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