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“The first customers bough pairs of telephones for communication point to point: between a factory and its business office, for example.  Queen Victory installed one at Windsor Castle and one at Buckingham Palace (fabricated in ivory; a gift from the savvy [Alexander Graham] Bell.”

• from The Information: A History, a Theory, a Flood by James Gleick

Kaiser Family Foundation has posted one of the most informative and well-packaged pieces I’ve ever seen on Medicare. I’d encourage everyone to have a go at the Medicare Quiz. It comprises 10 quick multiple choice questions. The questions are reasonably challenging without being esoteric. You get your score right at the end of the quiz, along with the correct answer (if you missed it) and an explanation of the answer.

I’m pretty savvy about Medicare but did miss two questions (share of low-income Medicare beneficiaries and share of beneficiaries with multiple chronic conditions). At least I got all the policy questions right.

One nice thing about the quiz is that the answers provide direct links to Kaiser resources where you can learn more.

Well done Kaiser! I’d like to see someone organize a whole set of these quizzes on different topics (not just health care) for the 2012 elections.

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The overall economy added 243,000 jobs last month — with the health-care sector continuing to show strength — while the unemployment rate fell to 8.3%.

As the WSJ reports, that’s the lowest the jobless rate has been since Feb. 2009. (Here’s the full report from the Bureau of Labor Statistics.)

The health-care industry added 30,900 jobs in January, following a revised increase of 17,600 jobs the previous month. (Originally the government reported a larger December gain of 22,600 jobs in the sector, as we reported.)

Data from the BLS gives a snapshot of job growth by facility rather than job function. For example, the report shows that hospitals added 12,700 jobs, but doesn’t say whether those were nursing, IT or cafeteria positions.

Ambulatory health-care services added 12,900 jobs as doctors’ offices, outpatient care centers and home-health services all saw growth.

Nursing-care facilities added 2,700 jobs, while the broader category of nursing and residential-care facilities overall gained 5,300 jobs in January.

Image: iStockphoto

It hasn’t been a great week for Susan G. Komen for the Cure, the breast-cancer advocacy group known for its pink-ribbon fundraising efforts.

Today the group reversed a decision — made public only Tuesday — to end Planned Parenthood’s eligibility for grants. Critics had said Komen planned to cut funding to the group for breast exams and education under pressure from anti-abortion organizations; Komen denied that.

The events of this week have been deeply unsettling for our supporters, partners and friends and all of us at Susan G. Komen.  We have been distressed at the presumption that the changes made to our funding criteria were done for political reasons or to specifically penalize Planned Parenthood.  They were not.

Komen’s short-lived move to defund Planned Parenthood spurred controversy, to put it mildly. Komen’s public rationale for its action changed over the week: A spokeswoman originally told the Associated Press it had changed its criteria to end grants to any organization under government investigation. But later in the week it said the decision sprang from a broader review of its criteria for grantees.

Today it said it would “amend the criteria to make clear that disqualifying investigations must be criminal and conclusive in nature and not political. That is what is right and fair.”

Planned Parenthood is the subject of a congressional investigation.

Komen’s statement continues:

Our only goal for our granting process is to support women and families in the fight against breast cancer.  Amending our criteria will ensure that politics has no place in our grant process.  We will continue to fund existing grants, including those of Planned Parenthood, and preserve their eligibility to apply for future grants, while maintaining the ability of our affiliates to make funding decisions that meet the needs of their communities.

It is our hope and we believe it is time for everyone involved to pause, slow down and reflect on how grants can most effectively and directly be administered without controversies that hurt the cause of women.  We urge everyone who has participated in this conversation across the country over the last few days to help us move past this issue.  We do not want our mission marred or affected by politics  — anyoneÂ’s politics.

Starting this afternoon, we will have calls with our network and key supporters to refocus our attention on our mission and get back to doing our work.  We ask for the public’s understanding and patience as we gather our Komen affiliates from around the country to determine how to move forward in the best interests of the women and people we serve.

We extend our deepest thanks for the outpouring of support we have received from so many in the past few days and we sincerely hope that these changes will be welcomed by those who have expressed their concern.

Planned Parenthood, in a statement, said it is “enormously grateful that the Komen Foundation has clarified its grantmaking criteria, and we look forward to continuing our partnership with Komen partners, leaders and volunteers.  What these past few days have demonstrated is the deep resolve all Americans share in the fight against cancer, and we honor those who are at the helm of this battle.”

So, readers, have the week’s events changed your opinion of Susan G. Komen for the Cure?

Photo: Associated Press

Medical Device Price Gap: A report from the Government Accountability Office finds that some hospitals pay thousands of dollars more than others for the very same medical device, the WSJ reports. The higher prices could affect Medicare spending, since payments to hospitals are in part based on the institutions’ costs, the paper says.

New Malaria-Death Estimate: A new calculation of malaria deaths published in the Lancet is about two times as big as the World Health Organization’s current estimate, the Washington Post reports. The report, which is expected to be controversial, agrees with the WHO that malaria deaths peaked in 2004 and are now on the decline. The two estimates diverge most widely when it comes to deaths in Africans aged five and older.

Nonprofit Controversy Continues: New York City Mayor Michael Bloomberg personally pledged $250,000 in matching funds to Planned Parenthood to make up for monies that will be lost when Susan G. Komen for the Cure stops most grants to the women’s health nonprofit’s affiliates for breast exams and education, the WSJ reports. Both groups say donations are up since Komen’s decision — which it says was prompted by several changes to its standards for grants — was made public earlier this week.

Supplement Ingredient Scrutinized: Dietary supplements containing an ingredient called DMAA are the subject of a safety review by the U.S. Army and have been removed from stores on military bases following the heart-attack deaths of two soldiers during workouts, the New York Times reports. Toxicology reports say DMAA was present in the soldiers when they died, but whether it played a role in the deaths isn’t yet known. Supplement makers and retailer GNC say products containing DMAA are safe, while other experts claim it should be classified as a drug rather than a supplement.

Image: iStockphoto

Turns out the Food and Drug Administration doesn’t achieve the impact it’s looking for in communications with physicians. That finding is drawn from a new paper that evaluates the impact of FDA warning labels and public health advisories over the past 20 years.

Some disappointing examples are noted:

• FDA recommended diabetes monitoring for patients taking atypical antipsychotics, but testing did not increase
• Warnings of drug/drug interaction weren’t heeded –at least for 18 months
• When FDA warned about prescribing drugs in certain populations (e.g., atypical antipsychotics for dementia) there was an across the board reduction in prescribing

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There are many mysteries when it comes to understanding AlzheimerÂ’s disease, with one of the biggest questions centering on how the memory-robbing disease progresses.

Decades ago, researchers discovered that the damage starts in the same part of the brain in all patients and systematically moves on to affect nearby regions. It wasnÂ’t clear, however, why this progression occurred. One intriguing theory was that the pathology “spreads” between neurons. But for years there wasnÂ’t a good way of testing the hypothesis.

Now, two new studies conducted in mice, one published in PLoS ONE and the other in press at Neuron, offer evidence that the damage –  specifically the misfolding of a protein called tau –  is likely passed from one neuron to another.

The exact mechanism isnÂ’t clear, but the researchers believe that somehow a flawed “template” for how tau should be folded gets released by one neuron and picked up by the next one, which then starts misfolding tau based on that new template, says Bradley Hyman, a Harvard neurology professor who is an author of the upcoming Neuron study.

Now, researchers can start figuring out how the errant message gets transmitted and picked up. Interrupting any step of this process could “plausibly” interrupt the progression of the disease, Hyman tells the Health Blog.

The papers have garnered a lot of interest. But some experts urge caution in interpreting the results.

The research “proposes a certain mechanism for tau spreading but that mechanism is unproven at this point,” William Thies, chief medical and scientific officer of the Alzheimer’s Association, tells the Health Blog.

“There’s a lot of work that needs to be done to clarify whether this is real” as well as how the findings could be used to inform therapy, says Thies.

Image: iStockphoto

Tobacco, alcohol … and sugar?

A new commentary published in Nature argues that just as the first two substances are regulated in various ways by government authorities, so should be sugar. While acknowledging that food, unlike alcohol and tobacco, is required for survival, the authors say taxes, zoning ordinances and even age limits for purchasing certain sugar-laden products are all appropriate remedies for what they see as a not-so-sweet problem.

The authors of the piece, Robert Lustig, Laura Schmidt and Claire Brindis, are all from the University of California, San Francisco. Lustig has been a particularly harsh (and longtime) critic of the impact of added sugars on health — here’s his widely viewed 2009 lecture on that topic. (Lustig was also a central character in a New York Times magazine piece on this subject last year.)

Note that they are talking about sugar added to foods. No one is arguing that we should spurn fruit, for example, because of the naturally occurring fructose.

“We believe attention should be turned to ‘added sugar,’ defined as any sweetener containing the molecule fructose that is added to food in processing,” the authors write. (And they argue the current dietary “bogeymen” — saturated fat and salt — deserve less scrutiny than the sweet white stuff.)

They’re talking about foods sweetened with sucrose — about half fructose and half glucose — and high-fructose corn syrup, which despite its name is mostly used in formulations that are 55% and 42% fructose.

The authors write that sugar is more than just empty calories — that growing evidence links fructose overconsumption with health problems including hypertension and diabetes. “Early studies” link it to cancer and cognitive decline, they write. They also argue that like tobacco and alcohol, “it acts on the brain to encourage subsequent intake.”

So, what’s a country to do? The authors propose taxing processed foods containing any kind of added sugars, including drinks and cereal. In addition, they suggest tightening licensing requirements on vending machines and snack bars selling sugary drinks in schools and at work, instituting zoning ordinances to restrict the number of fast-food restaurants and convenience stores in low-income neighborhoods and near schools, and even instituting an age limit for purchasing sugary drinks such as soda.

And they want the FDA to consider removing fructose from the list of ingredients deemed Generally Recognized as Safe. (Douglas Karas, an FDA spokesman, says that step is not currently being considered.)

The Sugar Association, not surprisingly, found a lot to dislike in the commentary. In a response published on its website, the industry group says that USDA stats show people are consuming about 425 more calories per day now than 40 years ago, with caloric sweeteners accounting for about 38 of those calories. Meantime, the group contends that consumption of cane and beet sugar has been falling even as obesity rates have been rising.

“We consider it irresponsible when health professionals use their platforms to instill fear by using words like ‘diabetes,’ ‘cancer,’ and even ‘death,’ without so much as one disclaimer about the fact that the incomplete science being referenced is inconclusive at best,” the association says.

The obesity problem “originates from the combination of overconsumption of all foods and lack of exercise. To label a single food as the one and only problem misinforms, misleads and confuses consumers, and simply adds to the problem,” the association says.

The National Confectioners Association, meantime, said that the group “supports realistic advice to Americans that accommodate all foods including occasional treats in moderation. There is a place for little pleasures, such as candy, in an overall lifestyle that supports health, wellness and happiness. In fact, helping the public understand how to incorporate little pleasures in their diet may well play the most important role in achieving and sustaining recommended dietary behaviors.”

If you do want to keep an eye on your sugar intake, the nutrition facts panel that appears on food packages now does not break out added and naturally-occurring sugars. But you can certainly see how many total grams of sugar you’re consuming.

Image: iStockphoto

Update: This post has been updated with comment from the NCA.

Industry pundits predicted a dismal year for Medicare Advantage plans but SURPRISE . . . premiums are down and enrollment up.

Forget that many PFFS model Advantage plans pulled out of some counties due to strict CMS requirements. According to Bloomberg, net enrollment in Advantage plans increased.

The enrollment rise to 12.8 million exceeded Medicare projections in May that membership would peak at 12.5 million in 2012 before falling to about 9.2 million by 2018 as cuts kick in on federal subsidies to insurers. The average premiums dropped to $31.54 per month, the U.S. Department of Health and Human Services said in a statement.

Robert Zirkelbach, a spokesman for America’s Health Insurance Plans, a trade group in Washington, wrote in an e-mail that plan members will face “higher out-of-pocket costs, reduced benefits and fewer health-care choices� as the health law’s payment cuts accelerate

Original content copyright © InsureBlog

Check out the latest edition of the Health Wonk Review at the Colorado Health Insurance Insider.  If the HWR hasn’t fulfilled your need to read, here are some additional links of interest as well.

Check out the Campaign 2012 edition of the Health Wonk Review at Colorado Health Insurance Insider.

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New post titled Health Wonk Review – Campaign 2012 Edition at Colorado Health Insurance Insider

Welcome to the Health Wonk Review.  We’re honored to be hosting, and were thoroughly impressed by the quality of the articles that were submitted for this edition.  A good number of them addressed the politics of healthcare reform and/or the Republican primary race.  So I thought it would be fitting to organize this edition of the Health Wonk Review as an election.  All of the candidates are well qualified and knowledgeable about healthcare, from many different angles.  And they all write quite convincingly.  Some take polar opposite positions, while others lean more toward the center.  I’ll summarize each candidate’s platform, and you can get all the details by clicking on the names.  Once you’re finished, cast your vote for your favorite in the comments.  Be warned, however – you will have a hard time choosing!

Ladies and gentlemen, here are your candidates for Wonkiest Health Wonk 2012:

Anthony Wright‘s camp is taking issue with Rep. Dave Camp’s position that the ACA is the reason for the decrease in the percentage of employers who offer health insurance benefits and the increase in premiums (both trends that were well established long before the ACA was crafted, and as Anthony points out, most of the provisions of the ACA haven’t been implemented yet).  Rep. Camp quoted Wright on his website, and mis-used the words to support his position that the ACA is to blame for the current problems.  Anthony is – quite understandably – unimpressed.

Joe Paduda‘s platform is all about taking aim at Mitt Romney’s enjoyment of firing people – and insurance companies.  Although it sounds nice (and very “free-market-y”) to say that if you don’t like your health insurance company you can just fire them, that isn’t usually the case.  Joe explains how most people have limited options (if any at all) when it comes to their health insurance, particularly if they have any health conditions.  Firing ones health insurance carrier isn’t really a possibility for most of the population.  Joe’s common sense approach should win over a lot of voters.

Gary Schwitzer‘s campaign is focused on calling out half-truths and shoddy journalism.  He cites an example of an ABC News segment that purports to be a journalistic look at a new “lifesaving” technology.  But it might just be blatant self-promotion on the part of the doctor being interviewed.  And even worse, it might convince countless viewers that they need the same high-tech test (along with several others that are mentioned in the story), despite the far less flashy stories about the comparative effectiveness data that indicate that the tests in question aren’t really useful for low-risk individuals.  And that leads to over-utilization of healthcare.  Which leads to increased healthcare spending.  Which leads to higher health insurance premiums.  Which leads to more people being uninsured.  It’s not a good cycle.  Kudos to Gary for digging in on this story.

Maggie Mahar‘s campaign is all about healthcare spending.  This has been a hot topic for the last several years, and people have been able to make the numbers say pretty much anything they want (lies, damned lies, and statistics?).  Maggie – in her usual thorough style – delves a little deeper into the fact that healthcare spending rose much more slowly over the past couple years than usual.  At first glance, that’s cause for celebration.  But we may see a spike in healthcare spending after the recession ends and/or people regain lost health insurance coverage.  Whether that spike will put us back to pre-recession levels remains to be seen.

David Williams is running on the idea that the much-hyped nursing shortage might be exaggerated.  We’ve all heard that there is a shortage of nurses all across the country that is predicted to grow rapidly over the next couple of decades as our baby boomer population ages.  But David points out that the economy doesn’t work that way.  As demand grows, so does supply.  And he notes that it’s possible that the stories of nursing shortages might be started (or at least spread around) by people with a vested interest in turning out more nurses.  Hard to argue with that logic.

Jaan Sidorov‘s campaign is centered around the increase in physician-to-physician referrals over the past decade (which is not at all surprising as far as he’s concerned).  The study that Jaan references cites two possible reasons for the increase:  increasingly complex healthcare (thus the need for more physicians to weigh in on a patient’s care) and a need to offload some work onto other care providers.  Dr. Sidorov also notes a couple of additional explanations:  the shift from HMO to PPO-style care, and an increase in consumerism on the patient’s part.  He’s done his research and it makes sense… is it enough to get your vote?

Roy Poses is running on a platform of transparency and openness – it’s time to talk about the elephants in the room.  Roy writes about a recent survey of the chairs of medicine and surgery at US medical schools which asked various questions about problems at the schools that nobody was willing to discuss.  The survey found that the majority of the respondents felt that there were indeed “elephants in the room” at their medical schools (although most of them felt that they were not themselves responsible for the lack of discussion).  But interestingly enough, the article about the things that we cannot mention didn’t specifically address what those things are.  We cannot mention what we cannot mention.  I always like candidates who tell it like it is and are willing to openly discuss the elephant in the room.

Jon Coppelman is running his campaign on the effectiveness of government safety programs for the workplace.  He focuses on CAL/OSHA and whether or not it has been effective in terms of improving workplace safety.  The answers are a bit murky.  As with most government programs, paperwork and official compliance is only half the battle; you have to also have company management that is focused on workplace safety and making it a priority on a daily basis.  And government programs often start with lofty ideals and goals only to find that implementation is more of a challenge than expected.

Jason Shafrin‘s campaign takes a closer look at President Obama’s recent State of the Union address, and specifically examines the aspects of it that focused on healthcare.  His take is that healthcare wasn’t really a focus during this most recent address – especially when compared with the State of the Union address in 2010 – and the President didn’t mention anything new this year.  Jason notes that if a Republican wins the election this year, the State of the Union address next year will likely have far more talk about healthcare, since repealing or significantly changing the ACA seems to be a top priority for a lot of Republican politicians.

John Goodman is running on the notion that it makes a lot more sense to tackle healthcare costs with a market-driven supply side strategy rather than continuing to implement government run, demand-side controls.  He paints a rather dismal picture of how demand-side buyers of care (including government and private enterprises) have failed repeatedly to control costs, while some supply-side programs have done an excellent job of providing high quality care while also controlling costs.  Being from Colorado, I have to throw Grand Junction into this debate.  I think the three-decade long collaboration between Rocky Mountain Health Plans and the physicians in the Grand Junction area is a good example of supply and demand working together to create a good model that is definitely working well.  But as John notes, you can’t just copy what works in one place and expect it to work everywhere – it’s not that simple.

Sharon Long‘s camp is calling foul over Senator Santorum’s erroneous claims regarding health reform during the last Republican debate.  The specific focus is on Mass. health reform and how the state’s healthcare system has fared over the past six years (hint:  it’s nowhere near as bad as Senator Santorum would have people believe), and Sharon points out the progress the state has made as well as areas that still need work.  Although the details are state-specific, many of the general ideas can give us a rough road map for how the rest of the country might be faring a few years down the line, once the ACA is fully implemented.

Bob Vineyard‘s platform is focused on the health insurance exchanges that are slated to being operationg in 2014.  He’s not impressed, and the point he makes is a very good one.  Health insurance agents play a vital role in consumers’ understanding of the policies they purchase.  Agents also tend to be the ones to answer most of the clients’ initial questions when they’re comparing policies and a lot of insureds call their agent first when they have a question after the policy is in place.  Bob notes that the high risk health insurance pools created by the ACA were supposed to cover 4 million people in the first two years.  Nearly 1.5 years in, 30,000 people have signed up and many states (including Colorado) are rapidly running out of money for the program.  The exchanges are expected to be all online, guided by “navigators” who may not be as knowledgeable as licensed agents, and are supposed to be the conduit to health insurance for 200 million people.  It might not go as smoothly as lawmakers were hoping.

Jared Rhoads‘ campaign is centered on the individual mandate in the ACA (and specifically, the similar version that Mass. enacted several years ago).  He notes that not everyone fits into the “insured” or “free-loader” categories.  There’s a third category of people who self-insure and/or want to purchase high deductible, catastrophic-only health insurance (which might not be considered “good enough” under the ACA).  Jared’s point is that the individual mandate implies that the people in that third category are free-loaders who should be forced into purchasing health insurance, and he calls foul.  Given the divisive nature of the individual mandate, Jared is sure to win over plenty of voters.

Neil Versel‘s campaign is calling out the left and the right – Kathleen Sebelius and Newt Gingrich – on healthcare reform.  He points out that Gingrich has aligned himself with the far right idea of repealing the ACA and has been distancing himself from his work over the past decade that pushed for health IT reform and technology-enhanced improvements in our healthcare system.  Neil also notes that Sebelius and the Obama Administration have been focusing a bit too much on the health insurance aspects of the ACA and seem to have forgotten that health insurance is not the same thing as healthcare.  Simply having health insurance does not guarantee access to care, affordability of care, or that the care one will receive will be of the highest possible quality.  Neil’s position ought to win him quite a bit of favor from a lot of center-minded folks.

Brad Wright‘s platform is one that will appeal to a lot of people, regardless of their political affiliation.  He’s proposing that we do a better job of scrutinizing the community benefits provided by non-profit hospitals.  Non-profit hospitals are exempt from federal taxes, but that’s in exchange for providing benefits to their communities – things like uncompensated care and job creation.  However, there’s not a lot of accountability around the whole process, and the waters get a bit murky when we try to differentiate the business practices of the for-profit and non-profit hospitals.

Fiona Gathright is running a campaign on the merits of “just do it” instead of “just talk about it”.  When it comes to wellness benefits provided by employers, it appears that tangible incentives like gym memberships (or even just breaks in the workday that encourage movement and activity) are valued by employees and are also more beneficial than online resources to encourage employees to incorporate healthy habits into their lives.  We all know what we need to do to be healthy.  Fiona’s campaign slogan might be “less talk, more action.”

There you have it.  16 excellent candidates.  Lots of different viewpoints -all very well explained and defended.  Enjoy the reading, and don’t forget to cast your vote for your favorite candidate.

Jason Shafrin at Healthcare Economist has the next Health Wonk Review

Related posts:

1. Health Wonk Review – The Election Is Over Edition
2. Health Wonk Review
3. Health Wonk Review at Health Care Policy and Marketplace Review

Visit for further reading: Colorado Health Insurance Insider - Research and discussion of the Colorado health insurance industry and the healthcare crisis in America.

Remember how opponents of the Patient Protection and Affordable Care Act (PPACA) vowed to “repeal and replace” the measure? It was and is a great slogan (I’m a sucker for alliteration, assonance and consonance) but it’s no surprise that the sloganeers have been slow to follow through on the replace part  –even as they retain enthusiasm for pushing repeal.

PPACA presents a fat target for opponents of an active federal role. It’s complex and ambitious, and even though at heart it is a very moderate (or even conservative) law, there are lots of hot button provisions to demonize. Health care is such an important emotional, personal and financial issue that people are justifiably nervous whenever something happens, and ready to listen to all kinds of claims.

Criticizing PPACA –whether over death panels, individual mandates, government takeovers, rationing or whatever– is fun and easy. It also obscures the fact that the health care system is drowning the country and really does need to be reformed one way or another. And that it’s very hard to do. As soon as PPACA opponents start listing out their “replace” ideas with any specificity they are going to be very vulnerable.

The Republican leadership knows this, and that’s why they haven’t issued any serious “replace” ideas. Now we hear from House Energy and Commerce Committee Chairman Joe Pitts (R-PA) that the replace ideas will come after the Supreme Court decision on PPACA’s constitutionality in June.

According to Pitts, here’s a taste of what’s in store: “giving the tax break for health insurance to the employee instead of the employer, medical liability reform, creating high-risk medical ‘pools’ and allowing insurers to sell their products across state lines.â€�

To which I reply, “That’s it? Those are tiny, insignificant tweaks.” Just to pick on these specific examples:

• Tax breaks don’t help people with low incomes –who are the ones who need help paying for health insurance
• Medical liability reform is a feel good measure that will have no appreciative impact on overall costs
• High-risk medical pools sound good but generally just stick government(!) with the bill for expensive patients
• Selling insurance products across state lines is just a way to trample on states’ rights to impose mandates

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The Department of Housing and Urban Development (HUD) is responsible for answering just that question.  To determine what level Section 8 vouchers should be set, HUD measures the rents for every county across the nation.  Specifically, they measure the 40th percentile and 50th percentile (i.e., median) rents in each area.  They choose to use the median so that high prices for luxury residences do not skew the measure of rent for a “typical” person in each area.  How does HUD calculate these Fair Market Rents (FMR)?  Today I will explain.

Methodology

To start with, HUD uses household data to measures gross rents.  Gross rents include both the cost for shelter (i.e., rent) and utilities.  To measure these costs, HUD uses 5-year estimates from the American Community Survey (ACS).  For FY2012, HUD used 2005-2009 ACS data.  The advantage of using 5 years of data is that the sample size is larger, thus increasing the precision of the rent estimates.  However, rent information from 2005 may be out-of-date.

To correct this problem, HUD uses a recent mover adjustment.  The recent mover adjustment compares the rent estimates from the most recent 1-year ACS estimates (e.g., 2009) against the 5-year estimates (e.g., 2005-2009).  If the difference between the two is statistically significant at the 90th percentile (|Z score|>1.645)¹, then the rent estimates are adjusted to match the 2009 estimate.  Although HUD could simply use a weighted average of the rent estimates and give more weight to more recent years, HUD does not do this, but instead uses this discrete ‘recent mover adjustment’ instead.

Using the ACS data, however, means that county rent estimates are not up-to-date through 2012.  To update the rents through 2010, HUD uses an inflation factor.  Specifically, they use the CPI housing index through 2010.  They account for regional variation in inflation by using metro-area housing CPI estimates for large metro areas with CPI-housing data available and regional CPI-housing data where metro-level information is not available.² D

Why do I care?

Why does the Healthcare Economist care about rental data? The reason is that the practice expense geographic practice cost index (GPCI) estimate regional variation in office rent cost for physicians using rental data from the American Community Survey. Prior to using the ACS, the practice expense GPCI relied on the HUD estimates to calculate regional variation on office rents. More detail on how the GPCIs use ACS rental data as a proxy for regional variation in physician rental costs can be found in this report.

¹ HUD ensures that the recent mover estimate for each non-metropolitan portion of the state has at least 100 ACS sample observations. If any state non-metropolitan recent mover rent is based on fewer than 100 observations, the recent mover factor would be calculated based on the 1-year recent mover data and 5-year standard quality data for the entire state.
² From the final rule: The ACS data are updated through 2009 using the one-half of the change in annual CPI measured between 2008 and 2009. This data are further updated through the end of 2010 using the annual change in CPI from 2009 to 2010. As in previous years, HUD uses Local CPI data for FMR areas with at least 75 percent of their population within Class A metropolitan areas covered by local CPI data. HUD uses Census region CPI data for FMR areas in Class B and C size metropolitan areas and non-metropolitan areas without local CPI update factors.. From 1990 to 2000, rents increased by 3 percent on average. To pro-rate 2010 rent estimates to 2012, HUD applies this 3 percent adjustment to the 2010 estimates to arrive at the final 2012 FMR estimates. It may seem odd that HUD uses old data (1990-2000) to trend rents, but the recent volatility in the housing market may imply that pre-2000 data may better reflect long-run trends in housing prices.

Small business is an essential part of the American economy and a key focus of the Patient Protection and Affordable Care Act (PPACA). Only 57 percent of companies with under 50 workers provide health insurance, compared to 92 percent in the 51-100 range and 97 percent with more than 100 employees. Despite what you may have heard, PPACA (aka ObamaCare) is not a radical government takeover of the health care system. Instead, it seeks to preserve and extend the employer-sponsored health insurance model and extend it further into the smaller employer realm.

PPACA was crafted to encourage smaller companies to provide insurance for employees by regulating the insurance market, establishing health insurance exchanges, providing tax credits for the smallest employers, providing grants for wellness programs and imposing penalties on some who don’t comply. We’ll see where all this leads as the Supreme Court considers PPACA’s constitutionality and Democrats and Republicans contest the 2012 elections, but small businesses would be wise to start planning for the full implementation of PPACA, which is less than two years away.

Kaiser Family Foundation has a good fact sheet on the topic. Key takeaways are:

• PPACA allows businesses to “grandfather” health plans in place as of March 2010. That was to address concerns that people would have to give up health plans they’re happy with now. Companies may wish to use grandfathered plans because such plans are subject to fewer requirements than the “Essential Health Benefits” that will be specified under PPACA. Most small businesses have at least one grandfathered plan. Theoretically these plans could be cheaper, but in practice I expect that most such plans will be abandoned over the next five years as market conditions change
• Health plans will have to guarantee that coverage is available and can be renewed. They’ll also have to offer coverage to dependents up to the age of 26. Importantly, plans won’t be able to base premiums on health status of a company’s employees. Instead they can rely only on age, smoking status, individual/family and location. They can provide substantial discounts for those engaged in wellness programs
• Essential Health Benefits (referred to above) will be decided on a state level, with federal input
• Health plans will be subject to minimum medical loss ratio (MLR) rules and will have to rebate overcharges if medical and quality improvement spending fails to reach 80 percent of premiums
• Plans will be assigned simplified ratings (bronze, silver, gold, platinum) to reflect their level of coverage relative to expected total costs
• Small businesses will be able to participate in state run or federally run health insurance exchanges
• There will be penalties for businesses with more than 51 employees if they don’t provide affordable coverage. Note that businesses with fewer than 50 employees are exempt from the penalties
• Substantial tax credits will  be available to low-wage businesses with fewer than 25 employees
• Businesses with fewer than 100 employees will be eligible for grants to launch wellness programs if they did not already have them in place

In short, PPACA has a lot of implications for small and mid-sized businesses. But employers with fewer than 50 workers won’t actually be compelled to do much. Their employees are likely to obtain insurance coverage through the individual market and Medicaid. In contrast, under state health reform in Massachusetts the mandate kicks in when employers have 10 employees, which is a big difference.

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One of the provisions in the Patient Protection and Affordable Care Act (a.k.a ACA, a.k.a. Health Reform, a.k.a. Obamacare) is that it limits the profits of health insurance companies.  The ACA imposes a minimum medical loss ratio (MLR) on all insurers.  The MLR is the amount of money spent on covered person medical care divided by the total revenue received through premiums.  There is some debate of what constitutes ‘medical care’ (e.g., do investments in electronic health records count as medical care?), but insurer profits certainly are non-medical.

The ACA requires health insurers in the individual and small group market to spend 80 percent of their premiums (after subtracting taxes and regulatory fees) on medical costs.  The corresponding figure for large groups is 85 percent.  According to a recent Kaiser tracking poll, 60 percent of the public views the MLR concept favorably, although only 38 percent was aware that the provision is in the ACA.  Insurance brokers may be getting squeezed for insurers to meet this amount.

Even though the MLR is a national law, it may not apply in your state.  Why?  Because many States are petitioning for a waiver.  HHS is currently reviewing applications from six states: Florida, Kansas, Michigan, Texas, Oklahoma and North Carolina.  According to The National Association of State Budget Officers, HHS has granted waivers to seven states: Maine, New Hampshire, Kentucky, Nevada, Iowa, Georgia and Wisconsin. The department has denied them to Delaware and North Dakota.

Why did these States receive waivers?  For a variety of reasons, but one of the reasons is due to the fact that some states have a less competitive medical market.  Maine, for instance, requested a MLR of 65%.  The reason was that State only has two large commercial insurers, Anthem Blue Cross Blue Shield (with 49% of the market) and MEGA Life and Health Insurance Company (with 33% of the market).  A public-private partnership, DirigoChoice, makes up most of the rest of the market.  Three HMO’s have less than 1% of the market combined between them.  To avoid the case where a large insurer would leave the market due to minimum MLR requirements and create a near monopoly, HHS decided to approve Maine’s request.

Notes:

• Section 2718 of the Public Health Services Act implements the minimum medical loss ratio requirement.

The National Association of State Budget Officers

Although executives and managers lead the way, in large part, the answer is doctors.  See the chart below.

Sources:

• John Bakija, Williams College ”Jobs and Income Growth of Top Earners and the Causes of Changing Income Inequality: Evidence from U.S. Tax Return Data.” November 2010, Working Paper.
• Hat tip: Mother Jones.

New post titled Retiree-Only Health Insurance Plans And The ACA at Colorado Health Insurance Insider

The provision in the ACA that allows young adults to remain on their parents’ health insurance policies until the age of 26 has been one of the more popular aspects of the health reform law.  It has increased the percentage of young adults with health insurance coverage and helps to make sure that recent graduates can remain insured even if they accept an entry-level job that doesn’t offer health insurance benefits.

The provision has received a lot of press coverage over the past couple years, and I would say that it’s widely understood.  But this article from The Colorado Health Foundation’s Sandy Graham illustrates a lesser-known loophole in the law:  The ACA was added to HIPAA, so plans that aren’t impacted by HIPAA are also not impacted by the ACA.  Retiree-only plans fall into this category.

Sandy’s daughter ended up getting an individual health insurance policy for $143/month.  But individual health insurance in Colorado is medically underwritten (and will be for almost two more years until the guaranteed-issue provision of the ACA begins in 2014), which means that she had to be relatively healthy in order to qualify for coverage and/or avoid an underwriting rate increase.  The benefit of the ACA rule that allows young adults to remain on their parents’ plan is that there is no need for additional underwriting – the coverage is continuous, regardless of any new medical issues that might have arisen since the plan was originally purchased.  This can be very useful for young adults with pre-existing conditions who haven’t yet secured a job that provides guaranteed issue group health insurance coverage.

I don’t know what percentage of the population is covered by retiree-only health plans, but it seems that group might be more likely than others to have children who are young adults.  I’m sure Sandy and her husband aren’t the only parents to have found out that the ACA doesn’t apply to their retiree-only health plan.

While we’re talking about The Colorado Health Foundation, the most recent issue of their quarterly magazine – Health Elevations – includes an article about our blog.  We’re thrilled and honored to be featured!

Related posts:

1. Retiree Health Insurance Benefits Based On Age Makes Sense
2. Health Insurance Options For Young Adults
3. Grand Rounds And A Defense Of Tiered Health Insurance Plans

Visit for further reading: Colorado Health Insurance Insider - Research and discussion of the Colorado health insurance industry and the healthcare crisis in America.

New post titled A Brain Teaser Cavalcade Of Risk at Colorado Health Insurance Insider

The Notwithstanding Blog hosted the Cavalcade of Risk this week in the most interesting fashion I’ve ever seen.  Check it out.   And be sure to grab a pencil and paper because it’s a quiz!  Since I’ve been writing about health insurance for quite a while and I’m familiar with a lot of the topics that usually appear in the COR, I took the quiz without reading the entries, just for fun (I got six right and two wrong). Our regular readers will probably have fun taking the quiz too, especially since most of the entries in this edition of the COR are related to healthcare and/or health insurance.

Jaan Sidorov’s article about health insurance exchanges is really good (and I had to read it to figure out the correct answer to the question for his post – it was one of the two I missed).  He notes that it’s a bit illogical that so many of us are willing to spend hours comparison shopping for a new TV, but feel put out if we have to spend much time at all comparison shopping for health insurance.  And he laments the fact that health insurance exchanges are in their very early days but already are being dismissed by some as too complicated for the average consumer to figure out.

Related posts:

1. Cavalcade of Risk – Colorado Nature Edition
2. Cavalcade of Risk #26
3. Cavalcade Of Risk – The New Year Edition

Visit for further reading: Colorado Health Insurance Insider - Research and discussion of the Colorado health insurance industry and the healthcare crisis in America.

New post titled The Elusive Nature Of Healthcare Costs at Colorado Health Insurance Insider

Dr Val Jones has done an excellent job with a four-part Grand Rounds this week, which was published on the USA Today site.  My favorite is Part Four, as it focused on one of my favorite subjects – healthcare costs.  This post from Common Sense Family Doctor is especially good, particularly if you’re a fan of consumer directed health insurance plans and HSA-qualified policies.  The author and his wife are both family practice doctors and have delivered hundreds of babies.  And they diligently tried to find out how much it would cost them to have their own baby in the months leading up to the birth.  But in the end, they just had to make an educated guess about how much money they would need to set aside to cover their 20% coinsurance, because nobody at the hospital could tell them how much it was going to cost, even assuming there were no complications.

We had an HSA qualified health insurance policy for our family for years, until we switched to a less expensive “Core Share” policy from Anthem Blue Cross Blue Shield last fall (still a high deductible plan, but not HSA qualified).  We’ve written about how difficult it can be to really shop around and be a “consumer” when it comes to healthcare.  And how even when you think you’ve dotted all your i’s and crossed all your t’s and asked all the right questions, you can still end up with unexpected charges.

I’m still a fan of consumer directed health plans, high deductibles, and HSAs.  I think that they can be useful tools to help people keep their health insurance premiums as low as possible and also (if an HSA is involved) set aside pre-tax money to cover potential future medical bills.  But they are not a panacea.  They are probably not a good solution for anyone who has a chronic illness that needs ongoing, expensive care.  They don’t work so well for people with very little money who would struggle to cover the relatively high out-of-pocket costs and would not likely be able to fund an HSA.  And no matter how great the actual consumer directed health plans are, the fact remains that transparency with regards to healthcare costs is still quite elusive.  For some procedures, it can be relatively easy to get a set figure up front in terms of how much it’s going to cost.  But much of the time that number can be difficult or impossible to pin down.  Obviously, complications can arise in any medical situation (and the resulting increase in costs would make earlier estimates irrelevant).  But even without factoring in complications, “shopping around” for healthcare is often an exercise in futility.  In order to make consumer directed health plans more effective, there is much work to be done with regards to cost transparency.

Related posts:

1. Comparing US Healthcare Costs With Other Countries
2. Capping Profits And Admin Costs Across The Healthcare Industry
3. Surprising Effect Of More PCPs On Healthcare Costs

Visit for further reading: Colorado Health Insurance Insider - Research and discussion of the Colorado health insurance industry and the healthcare crisis in America.

New post titled Colorado House Passes Resolution To Repeal ACA at Colorado Health Insurance Insider

In 2010, soon after the ACA was signed into law, Colorado’s Attorney General joined with AGs from several other states to bring a lawsuit against the federal government, challenging the legality of the individual mandate portion of the law.  A total of 26 states eventually joined in the lawsuit, although even within those states there is plenty of controversy surrounding the individual mandate and the ACA in general.  The legal battle will reach the Supreme Court later this year.

But now Colorado’s House of Representatives has voted to initiate an amendment to the US Constitution that would repeal the ACA.  In order to be successful, state-initiated amendments have to be passed by at least two thirds of the states.  So 33 other states would have to pass a resolution similar to what Colorado has done.  Given the fact that only 26 states joined in the lawsuit to challenge the legality of the individual mandate (the cornerstone of the “unconstitutional” argument) it seems extremely unlikely that two thirds of the states will pass measures calling for a state-initiated amendment that would repeal the ACA.

Although the Republican-led Colorado House passed the measure, Democratic lawmakers were not impressed.  They chided the Republicans for wasting time and money on a resolution that isn’t going to end up going anywhere (presumably because of the extremely slim chances of having two thirds of the states pass a similar measure).

Given the fact that the legality of the ACA is going to come before the Supreme Court this year, I agree that the new Colorado resolution seems like a waste of legislative time.  The Supreme Court will tell us whether or not the federal government has the right to make health insurance mandatory, and the states that are taking the opposing position on the matter have already joined in a lawsuit to express their position.  Hopefully Colorado’s lawmakers will work together from both sides of the aisle and move on to other issues that are facing the state.

Related posts:

1. Colorado HB1389 Passes House And Senate
2. Colorado House Bill 1355 Passes Senate
3. Colorado House Bill 1025 Would Repeal Health Care Affordability Act

Visit for further reading: Colorado Health Insurance Insider - Research and discussion of the Colorado health insurance industry and the healthcare crisis in America.

This past year my daughter visited a retail clinic for a strep throat and my husband visited an urgent care center for his stitches.  Both of these experiences provided excellent value and I would highly recommend retail clinics and urgent care centers for certain types of conditions.  An article written by Misty Williams in the Atlanta Journal Constitution earlier this month discusses when to use a drugstore clinic.

When to use a drugstore clinic

As Americans increasingly pay more out of pocket for their health care, millions are turning to retail clinics -- often located in pharmacies or grocery stores and requiring no appointment -- as a more convenient, cheaper alternative to a primary care doctor.

Typically staffed by nurse practitioners, walk-in clinics are aimed at treating minor ailments such as strep throat or ear infections. They offer weekend and evening hours for people who can’t take off work during the day or face long waits for appointments with their regular doctors.

Retail clinics first began popping up across the country in 2000 and now number roughly 1,200, according to RAND Corp., a nonprofit research group.

The benefit of these walk-in clinics, however, depends on a consumer's situation.

Because they are significantly cheaper, retail clinics often appeal to people who are uninsured and have to pay out of pocket, said RAND researcher Ateev Mehrotra.

The cost of care at walk-in clinics at stores such as CVS, Walgreens and Walmart is on average 30 to 40 percent less expensive than a physician office or urgent care center and roughly 80 percent lower than an ER, a RAND study shows. For consumers, the average cost of an ER visit for strep throat can range from $550 to $750 versus $59 at a retail clinic, data from insurance giant Aetna shows.

“[Patients] really like the predictability of the cost,� Mehrotra said.
 
Cost is also playing a larger role in people’s decision on where to get care as high-deductible insurance plans that require consumers to pay more out of pocket grow increasingly popular, said David Van Houtte, Aetna senior network manager who negotiates contracts with retail clinics across the country. For people with insurance, who would have the same co-pay as going to a doctor office, retail clinics are more about the convenience, Mehrotra said.

Getting time off from work can be a struggle for many people, he said.
 
Sujal Patel stopped by a MinuteClinic inside a Virginia-Highland neighborhood CVS on a recent afternoon after battling a nagging sore throat for three days.

Retail clinics are a big convenience, said Patel, who manages pharmacies and swung by on his lunch break.

“If I had gone to a doctor, I would have had to take time off,� he said. “Doctors don’t usually see you right away.�

At the CVS clinic, he was able to get medicines for his respiratory infection and to help him sleep right away without having to drive to a separate pharmacy.

The quality of care at retail clinics is of similar quality to regular doctor offices and other providers, Mehrotra said.

Aetna has a stringent process to credential clinics before contracting with them -- including random site visits to ensure quality is up to standards, Van Houtte said. Each clinic is overseen by physicians, and the staff is required to report back to primary care doctors for patients who have one, he said.

Retail clinics may be one solution to help curb the nation’s increasing health care costs, though they aren’t a magic bullet, Mehrotra said. Roughly 17 percent of visits to ERs could be treated at a retail clinic or urgent care center -- saving up to $4.4 billion annually, according to one RAND study.

“No one should think this is really going to solve the cost spending trends in the United States -- though some would argue every little bit helps,� he said.

Comparing costs

The overall cost of care at retail clinics is substantially less at retail clinics compared with physician offices, urgent care centers and emergency departments, according to a study by RAND Corp., a nonprofit research group. The study looked at the average cost of treating an ear infection, sore throat or urinary tract infection.

• Retail clinic: $110
• Physician office: $166
• Urgent care center: $156
• Emergency department: $570

Source: RAND Corp.

• Retail clinic: Allergies, strep throat, flu vaccinations, ear or sinus infections
• Urgent care center: Sprains, flu, minor cuts, headaches-migraine/tension
• Emergency department: Chest pains, trouble breathing, deep cuts, life-threatening symptoms

Source: Aetna

Educating Consumers about Healthcare Price Transparency is the Best Solution to Controlling Costs>

Health reform won’t stop providers from overcharging for care, only consumers can do that. Here’s my story of how I could have paid tens of thousands of dollars more for two minor outpatient surgical procedures, had I not understood how the healthcare system worked. It illustrates just how much we need a healthcare system with price transparency built in – something we will not get under the Affordable Care Act (ACA).

I am a doctor and the father of a 12 year old boy who has cerebral palsy. My son is fortunate to be healthy and active with minor medical needs. But as he has grown, he experienced some issues with contractures in his right lower leg which recently required a minor two hour outpatient surgical procedure.

When my son’s surgery was scheduled, I started getting price estimates from the surgeon, anesthesiologist and the facility, since we have a high deductible insurance plan. The physician’s fees were straight forward and relatively easy to obtain.

Not so with the facility. My son’s surgery was scheduled at the local hospital’s outpatient surgical facility which sent the procedure codes to an external reviewer. Three days later the reviewer came back at $37,000. The hospital referred me to my insurance company. The PPO network said that they could not reveal the prices until after the case was performed.

The hospital said it expected to discount the price, which would be in the range of $15,000 to $25,000.  Then I asked my son’s surgeon if he ever operated at any independent Ambulatory Surgical Centers (ASC). One phone call and 10 minutes later, I have the exact price for his surgery: $1,515.

Five years ago, there were virtually no tools that could help consumers figure out what they should pay for a healthcare. Today, with the availability of new technology and new methods to analyze claims data, service providers can develop tools that will help companies examine what different providers in their network charge for tests, procedures, treatments and services in their market.  With that knowledge in hand, they can find a fair price for what is needed. The better educated people are about what a fair price should be, the better equipped they are to talk with providers and facilities about fees before a procedure is done.

Customized tools are available for self-funded employer plans, so employees can search provider pricing within their own networks. We have found that even within the same plan the price for a routine test can vary by thousands of dollars.

ACA and Consumerism: No Price Transparency

Even after the Affordable Care Act, large gaps which cost consumers and self-funded employers a lot of money, must be addressed. The ACA does not address the wide disparity in healthcare pricing or encourage, much less mandate, pricing transparency.  While my case was an extreme situation of potential overcharge, there is still an enormous amount of price variability in the health care system, even within individual health plans. Employers and their employees will continue to pay way too much for common healthcare services, often as much as five times more than they should.

The ACA will also impact the ability to encourage consumerism in plan design.  Some of the provisions may foster consumerism such as the excise tax on rich benefits plans and the increased threshold for medical expense itemized deductions.  Other provisions will limit an employer’s ability to foster consumerism, such as the elimination of lifetime limits, the requirement to provide certain services at 100 percent coverage, and the limitations on Flexible Spending Accounts.

The ACA does not help employees or employers learn the real costs of care. The Massachusetts Attorney General report entitled Investigation of Health Care Cost Trends and Cost Drivers from January, 2010, provides a good overview of the wide variation in healthcare pricing and the factors that lead to it.  It says price variations are not correlated to quality of care, the sickness of the population being served, volume of Medicare or Medicaid patients, whether a provider offers services at an  academic teaching or research facility, or differences in hospital costs of delivering similar services at similar facilities. 

The report concluded that price variations are correlated to market leverage, as measured by the relative market position of the hospital or provider group, and then compared with other hospitals or provider groups in the local area.

Congress has considered other legislation (HR 4700, HR 2249, HR 4803) which would have addressed the transparency issue, but these bills did not make significant progress in passage. Employers are left to find their own solutions to these challenges.

Turning Employees into Educated Healthcare Consumers

Most employees don’t realize that if they use in-network providers the cost of their care could vary by over 500 percent depending on which in-network provider they choose.  If they need an MRI, they could get it for $500 at one imaging center and pay over $3,000 at another center.  Their colonoscopy might cost $950 at one location and over $3,500 at another.  The same holds true for almost every service they need. 

Why don’t they know? First, they don’t have any idea how much healthcare services should cost or what is the fair price they should pay.  Second, they are rarely told how much the service will cost before they get their care, and many times they don’t even realize that they can ask. Finally, many benefit designs with fixed co-payments remove patients need to know or care.

Even when employees have access to insurance company portals, these portals are rarely used and most don’t provide clear pricing information. 

When reviewing employee purchasing behavior, it is clear that the current system is not producing favorable results.  Most employees pay too much for care.  And this occurs regardless of employer location, insurance company or provider network.

Employers are consistently spending 4 to 15 percent more on healthcare than they would if their employees made value based care decisions. It is important to note that this spending is not for higher quality care.  Numerous studies have shown that higher healthcare prices do not indicate high quality care. Health reform has the potential to make this situation even worse as the push to create Accountable Care Organizations (ACO) encourages providers to consolidate.    Employers will need to carefully consider the value offered by new provider network arrangements, and ensure that they come with transparent offerings with respect to both quality and cost.

Effective Ways to Reduce Costs and Still Deliver Quality Care

Think of it as a cost/value gap. People would never knowingly overpay for a car or home. They would do research ahead of time, find out what current market rates are and approach the buying process as knowledgeable consumers. In healthcare, that’s unusual. Employers and employees can deliver the same value at a lower cost, if they approach the situation as educated consumers.

Employers are the key to solving the cost/value gap in healthcare.  Employers make the ultimate decisions regarding benefit designs that encourage consumerism, the networks that direct patients to high value providers, and the education and tools to support employees in selecting healthcare services.

Many employers have implemented wellness and disease management programs often with incentives for participation or even penalties for failure to engage in healthy behaviors.  However, when it comes to encouraging employees to make better choices about buying healthcare services, most employers have not supported or encouraged real consumerism. Here are a three methods that can help.

1.    Put consumerism into all health and wellness programs.    Every nurse or member of a call center support staff should have access to pricing and transparency tools needed to fully educate a patient on cost of care. There are tools available that show the range of prices charged by the health plans and providers in their network, so employees can make educated choices about which providers they should use. Why recommend an employee get a colonoscopy but not also suggest where they might get a high quality study at one-third the cost of some locations?  Employers could triple their cancer screening rates without spending any additional money if they design their programs correctly. 

2.    Make sure employers understand their network prices and quality variations. Employers should look at their data. They may be surprised at the variations and opportunities in price.  At a minimum, it may affect how benefits are designed. Some employers are even taking additional steps, such as setting up narrower networks to ensure their employees get the best care at the best price.

3.    Don’t be satisfied with just a provider directory.  Employers may want to rethink the traditional approach of the provider directory that places the providers first and may not even include pricing information.  To be effective consumers, employees must first know how much care should cost. Then they must have the ability to find providers who offer fair pricing.  Make sure this information isn’t hidden on a little used portal; put it at the employee desktop. Make it available in their hands in the doctor’s office by way of their mobile phones.  Make sure every nurse or health coach they talk to can support them.

The Affordable Care Act may not address health transparency issues, but there is no reason why, with t technological tools in hand, employees or medical professionals like myself for that matter, have to overpay for care. Employees that are given the chance to understand healthcare pricing, particularly under Consumer Directed Health Plans (CDHP), are often very appreciative of the results. More importantly, employers can achieve substantial savings that allow for continued health benefits at affordable rates.

About The Author

Dr. Jeffrey Rice is CEO of www.healthcarebluebook.com.

The Healthcare Blue Book provides employers with analytics to help them understand their provider network costs and comprehensive programs to support employees with healthcare consumerism.  The Healthcare Blue Book is a leader in supporting employers with high deductible health plans, consumer directed health plans and reference pricing.

Why don’t health plans provide their members with useful tools so members can look-up and compare true out-of-pocket prices for health care services --based on their policy, coverage and deductible?  If the plans did provide these types of tools, members would be able to compare prices, evaluate costs before visiting the doctor’s office and save money for both the member and the health plan by finding the best value!  Sounds too good to be true.  Some employers are pushing for transparency and hiring outside vendors to provide solutions for price transparency tools.   A few health plans are providing, in my opinion, very limited tools to help member’s look-up costs before visiting a provider.

As more and more people enroll in high-deductible health plans that require consumers to pay for services upfront before their coverage kicks in, the requirement for pricing tools becomes critical.

The challenge with obtaining access to meaningful price information from claims data continues to be a major obstacle.  An article written by Anna Wilde Mathews, Push for Health-Cost Data, published last week in the Wall Street Journal is a must read for anyone trying to understand the secrecy behind health care price data. 

Do you often think that you might be overspending on health care bills? Have you ever been surprised by the amount you owe the provider when the bill arrived in the mail?

Doctors can be helpful if you communicate with them early on to let them know costs are important to you. John Santa, the director of the Consumer Reports Health Ratings Center, offers some practical advice on how consumers should communicate with doctors to negotiate their medical bills. Click here to read the entire article that appeared in the Washington Post last week.

 

As a consumer advocate for health care price transparency, I run across dozens of articles every month that demonstrate every day examples of the disparity in what consumers pay for health care services.  The articles all provide specific examples of how prices can vary widely for the exact same service in the same area.  This is a wake-up call for consumers.  The conclusion is always the same -- consumers can and should shop around to find the best price for routine health care services before visiting a provider. 

Saving hundreds of dollars on a medical procedure using a high quality provider is possible and the tools to make comparison shopping practical for consumers are starting to evolve.  Before you schedule your next appointment for a lab test, MRI, x-ray, mammogram, colonoscopy, or eye/dental exam, make sure you do a little research and shop around to find the best value.

A Tribune-Review investigation exploring health care costs finds the price for identical medical procedures differs widely across the United States, not only by region, but even within the same hospital or clinic. Cost also depends on who pays -- an insurer, Medicare or the consumer -- and the differences can amount to thousands of dollars. This article reveals the disparity for an MRI ranging in price from as low as $300 in South Florida to $3100 for the exact same MRI in Texas.   A routine cholesterol test at a national lab was only $11 and the same lab test at a San Francisco hospital was $150.  You do the math.

People will marry for health insurance, not only in California. But how many will go on national TV?

http://www.cnn.com/video/#/video/bestoftv/2010/02/03/hln.behar.andrew.young.intv.cnn?hpt=T2

Jonathan Pletzke is a consumer expert on health insurance and author of the health insurance book Get a Good Deal on Your Health Insurance Without Getting Ripped-Off, available online and at bookstores nationally. Additional details can be found at the consumers health insurance book and resources website www.BestHealthInsuranceBook.com. Copyright 2007-2008 Aji Publishing.

Here is an article worth reading about the nature of health care expenses, how we make the decisions about what to spend and how much, and why having your own health insurance policy may mean that you are a better cost risk than someone on a government or employer’s plan:

http://www.cnn.com/2009/POLITICS/06/15/miron.health.costs/index.html

Jonathan Pletzke is a consumer expert on health insurance and author of the health insurance book Get a Good Deal on Your Health Insurance Without Getting Ripped-Off, available online and at bookstores nationally. Additional details can be found at the consumers health insurance book and resources website www.BestHealthInsuranceBook.com. Copyright 2007-2008 Aji Publishing.

This health insurance question came to me recently and I thought it worth sharing:

We are meeting with our health insurance broker tomorrow to review and select options in providing our employees HMO/PPO health insurance benefits.  We have many options, and many rates in front of us between two insurers.  Would you be able to suggest a few key critical review questions we should be asking our broker both from the perspectives of 1) lowest cost options to the company and 2) acceptable employee options?  We have under 50 employees now, and are going to contribute 50% to the plan for the employees.  None of us are experts in benefits, so we want to be sure we are making the choices in both the best interest of the company and to our employees which range in age from 22 to 75, half of which are over 50. 

From a benefits perspective, you certainly know more about what it takes to attract and retain employees in your industry. My recommendation is to make sure you get all the numbers to make your health insurance spreadsheet for comparison and know how high a health insurance deductible your group will be able to tolerate (the higher the health insurance deductible, the lower the monthly health insurance rate). Depending on the group of employees and creative strategies allowed in your state, some companies are able to create reimbursement packages for employees such that they buy their own health insurance and/or receive HSA contributions from the employer.

Buying health insurance will be an annual exercise for your company, and of course there are other options such as employee leasing companies that can handle all of these details for you. Be sure to check out news stories (such as those from the LA Times and the Wall Street Journal) on these health insurers as well as to check them out via the free online databases in the health insurance resources center. You may also wish to make sure you are considering all of your options by looking at the insurers rated best at in the health insurance resource center and ensuring that you have health insurance quotes from them.

Best wishes on your search.

Jonathan Pletzke is a consumer expert on health insurance and author of the health insurance book Get a Good Deal on Your Health Insurance Without Getting Ripped-Off, available online and at bookstores nationally. Additional details can be found at the consumers health insurance book and resources website www.BestHealthInsuranceBook.com. Copyright 2007-2008 Aji Publishing.

I know it sounds crazy, but did you know that if you move to another state you may easily get health insurance, no questions asked? The reason is because some states do not allow medical underwriting when applying for health insurance, whereas the bulk of them do. So those states that don’t allow medical underwriting are much easier to get health insurance regardless of medical status – the application forms don’t involve disclosing your detailed medical history.

Sure there’s a waiting period for pre-existing conditions (perhaps six months), but then you’ll have your health insurance – and having health insurance is an essential component of many people’s financial picture. For whatever reason you no longer have health insurance, whether it due to an illness, a family situation, a layoff, or one of the many other reasons, getting it back can be essential. Relocating to a friendlier state may be your solution, along with considering the other options available without moving, including obtaining employment that offers health insurance or buying your own (and making sure that you know all of your options – that’s why I wrote a book on health insurance!)

Moving is not to be taken lightly – there are many consequences and expenses involved with moving. However, you can move to your new state in a very lightweight way, simply by establishing a residence consisting of no more than a studio apartment or a bedroom in a shared house. As you further transition to your new state, you may begin moving more items to the new state, and continue to make your transition. Some people never move everything they own to a new state, but have a second residence elsewhere (such as the scenario that many retirees desire – with a residence in Florida and a second home elsewhere). So long as you meet the defined requirements of residency in your new location, you’ll still continue to be able to travel and visit anywhere that you wish.

So which are the states that offer guaranteed issue health insurance without medical underwriting? Presently the short list of states includes:

• Maine Health Insurance
• Massachusetts Health Insurance
• New York Health Insurance
• New Jersey Health Insurance
• Vermont Health Insurance

A few more states that I’ve found have special programs that really help people in need of guaranteed issue health insurance (check with your state department of insurance as well as others before you make a move):

• Oregon Health Insurance
• Washington Health Insurance
• Michigan Health Insurance
• Rhode Island Health Insurance

If you don’t wish to move, then you may find that your state offers guaranteed issue health insurance, subsidized rates for certain income levels, and special programs and special times of year when health insurance is not medically underwritten. There may also be specific special programs for those that have lost employment due to jobs moving overseas, or certain other industry and natural events. The best place to start finding out about these programs is with your state department of insurance. You can find contact information for your state department of insurance at State Health Insurance Resources at http://www.besthealthinsurancebook.com/state-health-insurance-resources/

As always, consult your team of financial and medical professionals before making a move. With these ideas and their advice, you may be better off.

This post originally appeared at HealthCentral.com at http://www.healthcentral.com/caregiver/c/76590/31355/insurance-move

Jonathan Pletzke is a consumer expert on health insurance and author of the health insurance book Get a Good Deal on Your Health Insurance Without Getting Ripped-Off, available online and at bookstores nationally. Additional details can be found at the consumers health insurance book and resources website www.BestHealthInsuranceBook.com. Copyright 2007-2008 Aji Publishing.

Cato Institute’s Michael Cannon hosts this compendium of insurance/risk related posts

Jonathan Pletzke is a consumer expert on health insurance and author of the health insurance book Get a Good Deal on Your Health Insurance Without Getting Ripped-Off, available online and at bookstores nationally. Additional details can be found at the consumers health insurance book and resources website www.BestHealthInsuranceBook.com. Copyright 2007-2008 Aji Publishing.