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RubinHealth Blog

Insurance Premiums Rise More Than 30%: What Did We Expect? PDF Print E-mail
Friday, 26 February 2010 18:08

This is another big week for health care reform. President Obama is hosting a bipartisan summit on Thursday to discuss all options for health care reform -- Democrat and Republican in full view of the American people. I do not expect any major breakthrough on reform but as always, I remain hopeful. The notion that Republicans and Democrats are going to find common ground seems far fetched given the opening positions of both groups. More on this in my next blog.

Also in the news is the recent rate increases for insurance premiums for individual policy holders. In California, Anthem Blue Cross, one of the larger health insurers in this country, announced rate increases as high as 39 percent. The average increase was 25 percent. These increases did not apply to those who get their insurance from their employer or through group plans. Anthem justified this increase by saying they lose money on these policy holders. I have no reason to doubt them although California regulators are investigating their spending on medical claims. It is also important to note that the nations 5 largest health insurers posted over $12 billion in profits last year and Anthem Blue Cross alone posted of $2.5 billion in profits in California the week before the rate increase was announced. Finally, 2.6 million Americans lost their health insurance coverage last year for various reasons.

Here is my point. This is exactly what we should expect to continue to happen without meaningful health care reform. Insurance companies will continue to play by the rules of the game which is what they do today. Expect continued industry profits and reductions in coverage levels and more cost shifting in the form of higher co-pays and deductibles. I was more surprised by the reaction of the public and the President than the actual announcements of the increase in rates. Here is why. The most important aspects of health care reform under both the Senate and House versions of the bills was to increase coverage for millions of Americans, mandate everyone have health care insurance (and provide subsidies for those who can not afford the coverage), eliminate preexisting conditions and the ability of the insurers to drop people when they get sick. Additionally, the bills were going to look at cost reforms and opening up of the insurance markets through state and/or federal insurance exchanges. Without any of these reform provisions, there is not mechanism in place to make sure people have health insurance. There are no rules to prevent the insurance companies from the very behavior we are all outraged over.

The Republican position remains based on the on the idea that the American people did not like the various health care reform bills in Washington because the were too big, too expensive, would facilitate a government takeover of health care, and ultimately lead to the rationing of health care. Let me be perfectly clear, it is simply just not true. While both Democrats and Republicans all believe the current system is not sustainable, the Republican position on health care reform merely makes minor changes to a failed system. When people are healthy and not worried about health insurance or the need for health care services, it is very easy to ignore the fundamental problems in the system. We tend to respond to the sound bites we hear in the news: "Insurance Industry Profits Reach Record Levels" or "Family with Mother Denied Treatment." Sure, those are horrible headlines. No one wants to see that happen in our country. But as the story dies down, we are left with the same fundamental problem, the system is broken. I would venture to guess that a significant portion of the 2.6 million Americans who lost their health insurance last year did not think we needed to reform the health care system last year. I bet they have changed their minds this year.

From my perspective, the outrage over the premium increases of the past few weeks is misplaced. We need to channel our feelings towards forcing our elected officials to start tackling health care reform in a meaningful way. Taking small minor measures will not work anymore. It does not matter whether you are Republican or Democrat. Ironically, there are divisions within each party over what provisions to adopt. Here is what we need to accept if we are going to really fix this problem -- anything short of this will really not work and if you do not believe me, just wait:

1. Insurance companies are going to have to change how the do business and they will only do that if it is regulated.

2. We will have to have individual mandates if we are going to expect the private insurance industry to survive (if we do not have individual mandates, then we will truly have a government takeover of health care insurance).

3. We must generate revenue to pay for the subsidies to cover more Americans. Whether we call it new taxes, assessments, or the elimination of current deductions, it must happen if we are going to cover the costs. If we do nothing, we will pay for it anyway with higher health insurance premiums and state taxes all to pay for the uninsured who will ultimately end up in our hospitals sicker than they would have been if they had access to affordable health care in the first place.

4. Cost controls. Period. We must look at how we spend our health care dollars and make sure we are providing excellent and high quality care without wasting money on unnecessary treatments.

Sure, there are other areas to focus on but if we start here, in one way or another, we will take big steps in fixing the problem and we will no longer need to be outraged when we hear stories in the media that merely shine a light on what we already know is wrong with our current system.

-Originally Published February 23, 2010 on The Huffington Post.

Andrew is on Huffington Post - Weekly Blog Posted Every Monday! PDF Print E-mail
Thursday, 04 February 2010 12:54


I am very excited to have the opportunity to blog on the Huffington Post.  As many of you know, RubinHealth is a vehicle to spread my message of healthcare reform.  Between my full time job at NYU Langone Medical Center, my radio show, Healthcare Connect, and my various TV appearances, writing 2 separate blogs each week is going to be a little difficult.  As I sort this all out, my newest blog is up and posted on the link below.  Stay tuned and keep coming to back so you can help me keep up the battle on reforming our healthcare system.

Check out BLOG 4 by clicking here.

Last Updated on Tuesday, 23 February 2010 21:59
The Cost of Healthcare Reform is Cheap PDF Print E-mail
Sunday, 24 January 2010 23:48

While healthcare reform is on life support in Washington, it is important for everyone to remember the financial impact of a failed attempt to reform the system. As I have been saying all along, the healthcare reform bills were expensive, flawed, and in need of major work. I also said we should pass the bill to get the process started because there is no way to get a perfect/great bill when it comes to something as complicated and big as healthcare reform. I think it’s important to highlight some of the short term costs to us as Americans. While many thought the reform bills were expensive, I believe, and will continue to believe, doing nothing will be even more costly. While there are many reasons, below are some of what we can all expect in the coming months/years if Washington politicians cannot come together to pass legislation to repair our broken system. In no particular order of importance:

1. Without costs controls, the price of healthcare will continue to rise as it has for decades at rates far above inflation. As prices rise, so will insurance premiums. There is a direct relationship between the price of healthcare insurance and the ability of people to pay for the coverage. Higher premiums means more people will lose their coverage because they can no longer afford to pay. The number of uninsured or underinsured Americans will rise at an alarming rate.

2. Without healthcare insurance reform, people will continue to run the risk of being dropped from their policies when they get sick or hit their benefit maximums. Many more will not be able to find coverage because they have a pre-existing condition. Much like rising premiums, more and more Americans will become uninsured.

3. Without payment reform to providers (hospitals, doctors), pharma, equipment/device manufacturers, etc. the price of services will also continue to rise. As prices for the services rise, the costs will need to be passed along to all of us, again, through our insurance premiums. As with the costs controls above, there will be further increases of insurance premiums.

4. As costs continue to climb and with no assistance for small businesses to provide insurance, many smaller employers will not be able to offer insurance to their employees. Even more troubling, as we have seen this past year, larger employers (self-insured) are going to further expand their cost shifting by increasingly adding to the out of pocket expenses paid by the employees. Higher copays, coinsurance amounts and deductibles will be the norm going forward. This past year saw this shift in cost sharing expand in far greater numbers than in years past. The trend will continue and a very fast pace. Making healthcare even more expensive for everyone who has insurance.

5. Medicare is in serious financial trouble. The healthcare reform bills provided a process to determine if money is well spent on treating certain conditions using outcomes data. Without a formal structure and process in place, slowing the growth of Medicare spending will be even more difficult. Taxes will be raised to cover the costs no different from what was in the bills that are being rejected.

In summary, doing nothing costs more. Both in the short and long term. It is not hard to figure out. One just needs to put politics aside to get consensus on a bill. It is not fair or good for the process to cut all the special interest deals that so alienated the public. We lost our way and need to make the true costs are understood by everyone.

Last Updated on Monday, 25 January 2010 11:37
Massachusetts Election a Tragedy and People Should Know Why! PDF Print E-mail
Wednesday, 20 January 2010 03:19

My blog readers already know I am a big believer in healthcare reform and they also know Rubinhealth.com is not about politics.  It's about explaining to people how our current healthcare system works today and how it would work tomorrow after reform.  I have been very upfront that there is enough in the current versions of the House and Senate Bills for everyone to hate.  I have said that because it is true.  The bills are far from perfect.  I have also said, and I believe it to be true more today than ever before, that doing nothing is far worse.  We have between 40 and 50 million uninsured Americans in this country.  There are 25 million more who are underinsured and most of these people do not even know it until they get sick.  16% of all money spent in this country is on healthcare and that cost is growing every year making healthcare more unaffordable to many.  Yet somehow this message was lost during the debate on the bills.  The public became frustrated and now the Senate lost it's 60 seat majority.  Healthcare reform is once again in serious jeopardy of failing.  More so today than ever before.

Our politicians let us down with the convoluted and highly political negotiating process.  They fought and could not find a way to work together and craft a bill that would put this country on a path forward.  So instead of getting a bipartisan bill, we got a democratic bill that had no republican support.  The fighting got worse, the horse trading to get votes became distasteful, and the public became sick of the process.  In the end, we forgot what this whole reform was about.  This country has lost a great opportunity to fix our severely broken system.  We could have addressed the bad/flawed parts of the bill after we passed this initial legislation.  Instead the future is as cloudy and unknown as ever before.  Sadly, more and more Americans will lose their healthcare insurance, file for more bankruptcies, and fall victim to pre-existing conditions and unaffordable healthcare.

What a sad day it is for all of us and I am still not sure we all fully understand why.  I hope those who are against the current bills never become victims of the very system they thought they needed protect.

Last Updated on Wednesday, 20 January 2010 20:53
Getting into the details of healthcare reform PDF Print E-mail
Monday, 04 January 2010 20:45

The healthcare reform debate is about to heat up again as the Senate and House start to reconcile their bills into one.  This process is going to be highly political and you are going to be hearing a lot about the various differences in the bills.  This information is already pretty well known and while the outcome is still uncertain, I think it’s reasonable to expect to a final bill in the next few weeks.  The key issues to reconcile include:

1. New Taxes – what  taxes are going to be implemented pay for this reform
2. Abortion Coverage – how restrictive will the language be in the final bill
3. Individual Mandates – what threshold will be established to make sure all Americans carry health insurance
4. Employer Responsibility – what penalties (and incentives) will be in place for employers to provide health insurance
5. Structure of Cost Reforms – what process will be implemented to review how we spend healthcare dollars today in order to reduce costs in the system

To me, this last item is probably the most difficult to understand and most likely will not impact a final bill.   There is some irony involved with cost reforms.  It is probably the most important component of healthcare reform, yet it is without question the least understood part.  Further, the implications of cost controls in healthcare reform are enormous.  Whatever changes take place, they will have a tremendous impact on how healthcare is delivered in this country.  I get more questions than you can imagine on cost controls.  My answer is frequently the same:  it’s complicated.  Understandably, it’s complicated is a very unsatisfying answer.  Over the next few weeks, I will start telling you what cost controls mean in terms of healthcare reform.  I will explain both sides of the issues and you will be able to see why it is going to be so difficult to accomplish without some form of sacrifice.

The first component to cost control will be a new group looking at how various diseases are treated/managed and make recommendations on best practices.  This is known as comparative effectiveness.  It would seem obvious to many that we reward/pay doctors and hospitals based on what is understood to be the best and most effective way to treat a condition.  While it is still unknown how this group will work, who will be included, and what power they will ultimately wield, we do know they will be looking at various types of diseases and conditions and making recommendations on routine protocols.  I have to believe the recommendations from this  commission will eventually lead to a change in reimbursement for specific drugs in treating certain conditions .  To be clear, this commission will not be able to limit Medicare reimbursement.  This power will remain with Medicare.  That being said, this commission will look at all available data to make the most informed recommendations that I can imagine will lead to a great deal of controversy related to their work.  While this group cannot say “drug A” is not allowed to be used (that will remain with the FDA), I do see situations where Medicare will take the commission findings and no longer reimburse a certain drug if the benefit is not scientifically and statistically proven to be worth the cost.  Since most insurance companies follow Medicare guidelines, it would become a defacto reimbursement policy.  As a society, we will be faced with the promise of new drugs and technologies against the realities of limited budgets.   For example, can we as a country afford $100,000 in drug costs to extend life for 2, 3, 4 or even 5 months?  What is the quality of that life in the last few months and how is its value determined?   I do not expect this to be the focus of the commissions work in the beginning of healthcare reform.  However, I think we would be naïve in thinking this is not going to come down the road.  It already happens in western nations.  It seems to be to be fair to look at all costs associated with treating illnesses.  It also seems reasonable that many will want to try anything and everything to save a life.  There is no right answer.  We know we can no longer afford the healthcare system we have today and this is only one of many concepts yet to be faced.  Stay tuned for more.

Last Updated on Tuesday, 05 January 2010 03:15
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