HSA's A part of the Solution

Rush Limbaugh made the statement, “You can’t insure your health.” We can’t insure that we will never get sick or hurt or never have a catastrophic event. But we can insure the medical expenses.

So the purpose of health insurance then is to reduce the costs of medical bills. The idea is that you are still responsible for some medical bills but the larger costs are paid by the insurance company. The larger the deductible (as we take more of the responsibility) the more the insurance company discounts the premium.

I believe in the concept of consumer-directed medical insurance coverage. I laid this out in an earlier blog. A medical insurance policy where patients are involved and more informed and taking on greater responsibility for their health care decision-making. A medical insurance policy that allows patients and doctors to make health care decisions and allows patients to decide how they want to spend their health care dollars.

This simple solution can save many families hundreds of dollars each year in health insurance premiums. I am talking about the “Tax free Health Savings Accounts.” The HSA plans combine a higher deductible and a lower premium with a qualified health savings account.

According to cato-at-liberty.org,. Eight million people are covered by plans with low-cost premiums and high deductibles that are designed for large, unexpected medical costs. Nearly a third of new HSA users, according to treasury figures, previously had no insurance or bought coverage on their own.

Money is also set-aside in a savings account to cover the deductibles, and even non-covered eligible medical expenses. Whatever you don’t spend from your savings account can build up tax-free.

We “can’t insure our health” but HSA’s allow you to decide how and where your health care dollars get spent. The HSA money is your money. You decide when to spend it and when to save it. .

You can even use the money to pay for qualified health care expenses that may not be covered on your health insurance plan.

HSA’s are portable. The HSA stays with you and goes wherever you go.

Remember. With an HSA you self ensure the amount of your family deductible. With a 100% co-insurance option, the plan will pay 100% of covered medical expenses once the deductible is met.

For a list of HSA covered expenses click here
http://www.wright.edu/hr/HSAIRS213(d)eligiblemedicalexpenses.pdf

Health care Solutions #4

Well, the good news is that people are talking about health care. Just look at what is happening at the Town Hall meetings. The bad news is, are people so busy talking that no one is listening?

In my previous blog I spoke of portability. COBRA (consolidated omnibus budget reconciliation act) is not the answer. Who can afford those premiums anyway? Lets focus on the man or woman who has worked a majority of their life and had health insurance through an employer. Then through a chain of events they lose their employer sponsored group medical benefits. A family premium on COBRA can easily run $1,000.00 per month and more.

If this individual has a pre- existing medical condition, he will be hard pressed to find an affordable alternative that will cover the pre- existing medical condition.

So lets expound upon portability and the value of taking your coverage with you.

I've stated before that we all should have individual coverage that is portable. If you can get coverage through the purchasing power of your employer so be it. However, employers and employees need new options for cost containment and individual freedom of choice.

Currently employers have few options to install cost containment practices. Employees have few options as to the benefits purchased. Employees don't have the option to purchase less costly and often times more appropriate benefits for their family.

Health insurance benefits should be a personal choice and portable. Each employee should be free to chose a plan that would remain with that employee even in the event of a job change.

The solution would be for the employer to pay for the policy of each employee who wants coverage and then deduct the premium from the employees wages.

Some major advantages would be;
1. The rising health care costs would no longer be a problem for employers since health insurance premiums would be a substitute for wages.
2. Employees would have opportunities to choose lower cost policies and higher take home pay.
3. Employees would have the opportunity to select insurance benefits tailored to their families needs.
4. Employees retain the tax advantages of the current system but avoid the waste that is inherent in the same exact benefit structure for all.
5. Employees would be able to continue coverage at fair prices even if they quit work or switch jobs.

For additional information on this idea I highly recommend the book, "Patient Power" by, John Goodman

health care solutions #3

The next compartment or part of the solution to bring down the cost of the health insurance premium deals with the insurance companies themselves. The insurance companies aren't the whole problem. They are a part of the solution.

This is not to say that I don't have some issues with the insurance companies. Premiums are very high and only getting worse. Many health insurance companies play the game of "deny and delay" with your insurance benefits. In my state of Arizona, last year alone, almost 50% of claims denied, which the department of insurance got involved in, were eventually overturned in favor of the insured.

Insurance companies do this to protect themselves from fraudulent insurance claims. Insurance fraud cost us billions of dollars each year. We all pay for this in our insurance premiums to the tune of several hundreds of dollars each year. We must do a better job curtailing fraud. I personally think fraud will only get worse in a government run plan.

Next, we need competition among insurers. In many states we only have a handful of companies competing for our business. We don't want to give insurance companies a monopoly. Competition is good for the consumer and it keeps the prices down and customer service up.

We need to have interstate competition. We have this for almost all other products and services which we purchase. Why not our health insurance? National center for Policy Analysis June 21, 2006 | Author: Devon Herrick. "Lack of Competition Drives Expensive Mandates. Since each state insurance market is protected from interstate competition, legislators can require insurers to cover services that drive up premiums. For example, about one-fourth of states mandate benefit packages that cover acupuncture and marriage counseling. More than half require coverage for social workers and 60 percent for contraceptives. Seven states require coverage for hairpieces and nine, hearing aids."

"When states force insurers to cover providers or benefits that consumers do not want (enough to pay for), both the insurer and the consumer lose. Consumers lose because they are required to pay for amenities they do not want. Insurers lose because mandated benefits and over-zealous insurance regulations drive up the cost and reduce the sales of insurance products."

We also need to fix the problem of portability. COBRA is not the answer. Those premiums are often outrageous in price and it is only a temporary stop gap. I'd like to see people own their own individual insurance policy. A policy that stays with you and goes wherever you go. If you lose your job, become self employed or whatever, you still have your existing policy. It also helps solve the problem of having a pre-existing condition. Because you keep your coverage and you keep your medical providers.

Tax incentives are available to employees whose employer provides insurance benefits. Tax incentives should be made available to all.

Government mandates add a large cost to our health insurance premiums. There should be a federal arm of the government to regulate the health insurance industry. By opening up the competition beyond state lines we won't need a separate agency in each state regulating. Rather each state have a branch to enforce rules for insurance transactions taking place in each given state.

Reduce the government mandates and allow the insurance companies to offer choices with the kinds of benefits that today's consumers want. This allows consumers to better control their premiums because they simply purchae the benefits important to them.

I'll have more on solutions in my next blog.

These are my opinions, I'd like to hear yours.

health care sloutions #2

In my last blog on July 27th I spoke of a sort of paradigm shift as a way to combat chronic disease in in our country. Imagine a reward system that actually rewards the doctor for keeping patients healthy. I suggested using alternative medicine providers and the the primary care physician to fill this roll. IBM and United Health Care Group are actually now testing this idea out in Arizona.

The idea behind this is that if patients can stay healthy we have fewer people landing in emergency rooms and fewer people on the chronic condition list. President Obama has also stressed preventative health measures.

I am old enough to remember when the family doctor oversaw all ones medical. When needing to refer you on to a specialist the family doctor acted as ones advocate. I don't know where it went but we need to bring back this role to the family doctor.

Solution #2. Put health care back in the hands of the consumer. Consumers need to be more involved in health care as they are in all other aspects of their lives, Mike McCallister, president and CEO of Human Health Care told an audience at a recent 2009 Wharton, health care business conference. With regards to health care "you can't get the price and quality information to make smart health care shopping decisions."

Allow consumers to make choices about how they want to spend their health care dollars. Consumers can be very savvy shoppers when they know what things cost. When consumers need have a stake in the game and when we are spending our money we tend to spend more wisely.

We're all going to have to have a little skin in the game. Check back over the next several days as I outline other solutions and reforms in the way insurance companies do their business.