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Accelerating The Destruction Of The Healthcare System

January 18, 2016

inDisinformation and the healthcare system, Medicine: Healthcare System, Stakeholder Abuse of the Healthcare System, Stakeholder Mistrust

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Stanley Feld M.D.,FACP,MACE

Most of you are familiar with my slide of the demise of the healthcare system.

Obamacare is accelerating the total collapse of the healthcare system. Once total collapse has occurred Americans might beg for a complete government taken over of the healthcare system with a single party payer system.

I have pointed out most of Obamacare’s new rules causing the unintended consequences and accelerating the healthcare system’s demise.

An unintended consequence in the Accountable Care Organization leads to a new rule to correct the consequence. Unelected officials then create another rule. The new rule results in other unintended consequences. All of these consequences accelerate the healthcare system’s demise.

Obamacare’s first year in operation was 2014. The Obama administration started taxing everyone in 2010 to support the added expenses Obamacare would generate.

Only the individual insurance portion of Obamacare was initiated.

The following are examples of unintended consequences.

Fourteen million people lost their individual healthcare insurance coverage in 2012 because of Obamacare’s new rules. Insurance coverage premiums increased because of the ACA’s required coverage.

Many workers lost their full time jobs. They were put on part-time employment in order for employers to avoid Obamacare penalties.

CMS reported that 13 million signed up for Obamacare in 2014 despite the healthcare.gov website disaster. The number of enrollees was revised a few of times down to 6.6 million because of counting errors.

The direct and indirect costs of Obamacare were never reported to the public.

Obamacare activated a reinsurance program that was built into the Affordable Care Act. The reinsurance program was a bailout to entice the healthcare insurance industry to participate in the Federal Health Insurance Exchanges without experiencing any loses.

The insurance industry has claims the Obama administration owed it 2.5 billion dollars in 2014. The Obama administration was able to pay only 12%. The law restricted the government’s reinsurance payment to a certain percentage of the premiums paid. The amount owed as promised to the healthcare insurance industry for their participation in Obamacare was $2.2 billion short.

I believe the healthcare insurance industry will be loath to participate in the Federal Health Insurance Exchanges in 2017. UnitedHealth has already threatened to quit participating.

This year (2016) during open enrollment only 8.1 million enrolled in the Federal Health Insurance Exchanges.

It has been difficult to trust CMS’s overall claims for the number of enrollees. It has nothing to do with how many people have paid first premium or the anticipated number who will continue to pay premiums throughout the year.

President Obama stated in his state of the union speech that 18 million previously uninsured have received insurance under Obamacare. This is not true.

For argument’s sake let say his number is correct.

More than half the enrollees received Medicaid. President Obama is urging states to expand Medicaid.

What is going to happen when Medicaid is expanded? More people will get free government supplied healthcare insurance but will not be able to find physicians. Medicaid reimbursement is so poor that few physicians participate.

The healthcare system’s demise is rapidly accelerating. Obamacare’s claiming to increase people being covered but these people cannot obtain healthcare services.

Obamacare does not incentivize these people to be responsible consumers. Obesity continues to increase and the dollars spent for healthcare continues to increase.

The truth is enrollment has been terrible for 2016. President Obama is expanding the enrollment period again this year to try to increase enrollment.

“Eager to maximize coverage under the Affordable Care Act, the Obama administration has allowed large numbers of people to sign up for insurance after the deadlines in the last two years, destabilizing insurance markets and driving up premiums, health insurance companies say.”

“The administration has created more than 30 “special enrollment” categories and sent emails to millions of Americans last year urging them to see if they might be able to sign up after the annual open enrollment deadline.

The Obama administration has done nothing to verify whether these late arrivals are eligible for insurance. They just sign up and are insured.

People have figured out they can wait until they become ill or need medical services to sign up. They then sign up and pay their premiums a few months’ premiums. They stop paying their premiums after they have received their medical services. They figure they do not need insurance any more.

“Individuals enrolled through special enrollment periods are utilizing up to 55 percent more services than their open enrollment counterparts” who sign up in the regular period, the Blue Cross and Blue Shield Association, whose local member companies operate in every state, told the administration.

The Obama administration has told the healthcare insurance industry that it has heard their concerns. The problem is that CMS has not done anything about the insurance industry’s concerns.

“Many individuals have no incentive to enroll in coverage during open enrollment, but can wait until they are sick or need services before enrolling and drop coverage immediately after receiving services, making the annual open enrollment period meaningless,” Steven B. Kelmar, an executive vice president of Aetna.”

Twenty five percent of Aetna enrollees have signed up during the special extended enrollment periods. It has been reported that last year 950,000 people enrolled during the special enrollment period between February and July 2015.

“Kevin J. Moynihan, the chief executive of the federal insurance marketplace, said it shows the marketplace is working to meet people’s needs. He said certain life changes like losing your coverage, having a child, turning 26, moving or getting married may qualify you for a special enrollment period.”

People who are qualified for insurance do not get verified for insurance. It is easy to understand that this leads to unstable insurance markets and subsequent increases in premium prices.

It is o.k. for progressives if healthcare insurance is considered a right under a single party payer system with the losses taken by the government even if the deficit increases.

It is not o.k. if the Obamacare healthcare system pretends to be developing an efficient free enterprise system with the healthcare insurance industry experiencing the loss under the weight of unidentified risks created by the federal government.

The number of people not continuing to pay their insurance premiums their entire year is enormous. The healthcare insurance industry had no way of anticipating this occurrence.

“On average,” Aetna said, “special enrollment period enrollees stay with us for less than four months, while enrollees who come to us during the annual open enrollment period maintain their coverage on average for eight to nine months.”

The same turnover rate has happened to UnitedHealth. It is one of the many reasons UnitedHealth has threatened to quit participating in Obamacare in 2017.

The result will be even higher insurance premiums next year. Most of the Obamacare insurance rates are unaffordable this year.

“Enroll America, a nonprofit group with close ties to the Obama administration, said the government “should not tighten eligibility or verification standards in ways that could place an undue burden on consumers.”

There is no verification for late enrollment. The last statement by “Enroll America” reflects President Obama’s progressive and irresponsible attitude toward fiscal responsibility.

It is no wonder the national debt has grown to $19.2 trillion dollars.

It is another way to accelerate the collapse of the healthcare system.

I believe President Obama knows exactly what he is doing. His problem is he does not understand or care about the significance of the effect the deficit increase will have on America’s financial stability.

Middle class Americans are getting slaughtered.

Additionally he does not understand that Americans will not accept a government controlled single party payer system.

The Republican Party must get on the stick right now. They must offer a viable alternative to President Obama’s goal of a single party payer system. They should not wait until after the election.

The alternative should work in an efficient way. It should put consumers in charge of their health and healthcare dollars.

It would be a good idea for Republicans to understand and offer as an alternative My Ideal Medical Saving Accounts.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.

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Destroying The Healthcare System

January 6, 2016

inMedicine: Healthcare System, Stakeholder Abuse of the Healthcare System, Stakeholder Mistrust

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Stanley Feld M.D, FACP,MACE

I believe President Obama’s goal is to destroy the healthcare system. The people will then beg the Obama administration to institute a single party payer system with the government being in full control.

The fact is Obamacare is not working despite the Obama administration’s convincing the mainstream media to advertise that it is very successful.

I was shocked at a December 9^th New York Times article stating:

“ A million new customers have signed up for health insurance during the Affordable Care Act’s third open-enrollment season, Obama administration officials said on Wednesday, and call centers have been deluged.”

This statement is an optimistic statement and a distraction from the true. A readers impression would be Obamacare is doing great.

The Obama administration simply ignored last year’s enrollment numbers. Ten million people were supposed to have signed up for healthcare coverage through the Federal Health Insurance Exchanges. Only seven million of those who signed up paid their premiums for the entire year.

The premiums and deductibles were too high even for the poor who received federal subsidies.

Most of the people remaining in the Obamacare in the federal exchanges were people with a pre-existing illness. One diabetic told me her individual premium for Obamacare was $12,500 dollars with a $6,000 dollar deductible. Her bill for last year, being hospitalized one time, was almost $100,000. She felt Obamacare was a very good deal for her.

The insurance company covering these kinds of patients with a pre-existing illness cannot make money for the insurance coverage they are required to provide.

If all the patients have pre-existing illnesses, the only thing the insurance companies can do is raise the premiums or stop selling insurance in this Federal Health Exchange market.

The Obama administration promised it would limit the insurance industry’s loss with its reinsurance program. The Obama administration reneged on its word and only paid 12% of what was due for 2014. The administration did not have the money to pay for it.

In 2014, the first year of coverage, we were told 13 million signed up, but only 7 million had coverage at the end of the year.

The administration provided data to the CBO to predict the number of enrollees Obamacare will have in 2016. The CBO predicted 21 million would be signed up for 2016. The CBO used data provided by the Obama administration to make this calculation.

What happened to the remaining 7 million enrollees for 2015? We are not told how many enrollees automatically re-enrolled.

We only hear that, ‘ A million new customers have signed up for health insurance.”

We can now understand the concerns expressed by UnitedHealth Group and other insurers that say they are losing money in the Obamacare Federal Health Insurance Exchanges.

Open enrollment is due to end January 1, 2015. In mid December CMS announced,

‘We are now seeing a surge of interest as we get closer to the deadline,” “Each day has been bigger than the day before.”

The last two weeks in December had less that 100,000 people sign up. Yet the government published these numbers. Many wonder how real these numbers are. If they are real there has been no increase in enrollment in the last year.

Confirmed 2016 Exchange QHPs: 9,584,850 as of 12/30/15
Projected Exchange QHPs: 11.32M by 01/02/15 (8.60M via HC.Gov)
In the last week in December only 80,000 people signed up compared to 96,000 the same week last year.

The coverage is poor and too expensive for most people.

Open enrollment has now been extended to January 31 for enrollment March 1^st.

“People who go without insurance next year may be subject to tax penalties of $695 a person or more, although some may be able to qualify for hardship exemptions.”

This is a joke. However, the joke is on the consumers and taxpayers.

So far, Obamacare has created a 10% increase in federal taxes middle-class taxpayers.

It has increased coverage for the Medicaid eligible poor. However, these people cannot find a doctor who will treat them.

The healthcare system is costing over three trillion dollars a year and increasing our deficit more than $1.5 trillion dollar a year. There are still 34 million people uninsured. How many people are under insured because their jobs have been changed to part time jobs? They cannot afford to buy Obamacare’s insurance?

2017 is the year the healthcare insurance markets are supposed to stabilize. These markets have not stabilized. Healthcare insurance companies, and business groups can not understand how the new CMS’ proposals will regulate and expand provider networks and standardize plan options let alone have insurance markets result in lower premiums.
“We remain deeply concerned that this proposed rule will not stabilize the individual market,” Steven Kelmar, Aetna’s executive vice president for corporate affairs, wrote in a letter to the CMS. “Unless some fundamental flaws are corrected, we believe there is a grave risk that the federal exchange will not operate as a viable, competitive market in 2017.”

One of the more significant and controversial provisions in the proposed rules involves the adequacy of provider networks. The CMS proposal demands that ACA-compliant health plans sold on the federal exchanges in 2017 would have to abide by new network standards.

All plan networks would have to include hospitals and doctors within certain travel times or distances from members. There would also be minimum provider-to-member ratios for some medical specialties.

CMS proposed that all health plans in each metal tier on the federal exchange have the same benefits. For example, all 2017 bronze options would have a $6,650 deductible, and all plans would have no more than one provider tier.

This proposal practically guarantees that the healthcare insurance industry selling insurance under Obamacare’s exchanges would lose money. Therefore, the industry would choose not to participate.

The big losers would be patients with preexisting illnesses. They would lose their insurance.

The traditional mainstream media is already cranking up the Obama administration spin machine to promote a single party payer system as the best and simplest option to provide insurance for all Americans.

Nobody is thinking about who will pay for a single party payer system after the administration emotionally conditions the public to beg for a single party payer system.

The hardest by increased costs in the system are consumers at every income level.

As the cost rises to unaffordable levels all consumers are starting to take think about taking responsibility for their health and healthcare dollars.

“The new research also finds that as a result of the increase in health care costs, focus group participants are changing how they operate within the health care system.

They are questioning their doctors recommendations more frequently, comparing cost and quality information for local providers, and even putting off seeking care altogether.”

Despite the low of enrollment in 2016 (that the Obama administration denies), CMS is about to publish new 2017 rules for the insurance industry. These rules are guaranteed to make the healthcare system more dysfunctional.

The fact is the structure of Obamacare is failing and about to collapse.

All of the Obama administration’s tinkering to stop the free fall is creating greater momentum for total collapse of the healthcare system.

The answer to fixing the healthcare system is not a single party payer system.

The answer is a consumer driven healthcare system with the aid of smart phones and the Internet and Medical Savings Accounts.

Progressives have a tendency to forget the math. They have more interest in satisfying an emotional response. The resulting entitlement policies lead to the unintended consequences and only make things worse.

Neil Cavuto demonstrated this logic recently in an interview with a student campaigning for free student loans.

https://youtu.be/Zmji36q8E4o

Progressives’ logic is faulty. It demonstrates a lack of understanding of the affects of entitlements and their unintended consequences.
The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.

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Making Medicine Function: Five (5) Key Elements From Stanley Feld M.D.,FACP,MACE : Repairing the Healthcare System

January 4, 2016

inSummary Blogs

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Scott Becker of Becker’s Healthcare asked me to write an article on Element needed to Repair The Healthcare System. Becker’s Healthcare is the leading source of cutting-edge business and legal information for healthcare industry leaders.

His portfolio includes five industry-leading trade publications:

Becker’s ASC Review
Becker’s Infection Control & Clinical Quality
Becker’s Spine Review
Becker’s Hospital Review
Becker’s Dental Review

My article appeared in the latest addition and with permission from Scott Becker. I am reprinting it on my site. Becker’s Healthcare is a valuable information site.

Making Medicine Function: Five (5) Key Elements From Stanley Feld M.D.,FACP,MACE : Repairing the Healthcare System

Patients, physicians, hospital executives, healthcare insurance executive and government all believe the healthcare system is dysfunctional and unsustainable in future years.

All the stakeholders are unhappy with Obamacare.

Clinical Endocrinologist, Stanley Feld, MD, FACP, MACE, is a physician who believes Obamacare’s business model is seriously flawed. He also believes that Obamacare has accelerated the dysfunction in the healthcare system.

Dr. Feld believes Obamacare has increased the healthcare system’s unsustainability by causing an increase in bureaucracy, a decrease in efficiency and encouraging the gaming of the healthcare system by all stakeholders.

The Obamacare business model must be changed to a consumer driven healthcare business model with the consumer in charge and in the center of the healthcare system, not the government or other secondary stakeholders.

Consumers must be taught and incentivized to use all the 21^st century technology tools available including smart phones. The goal must be to improve medical care and treatment outcomes, not improve the measurement of medical process outcomes.

Dr. Feld became interested in the causes of the healthcare system’s dysfunction in 1991 while he was on the steering committee of a nascent medical organization, the American Association of Clinical Endocrinologists (AACE).

He became AACE’s third President and was chairman of the Type 2 Diabetes Guideline committee. He was the chief author of “A System of Intensive Self-Management of Type 2 Diabetes Mellitus.”

In 1991 there was little government and healthcare insurance industry support for the concept of teaching the Type 2 Diabetics how to be the “Professor of Their Disease” even though there was a Type 2 Diabetes epidemic.

The epidemic was the result of lack of understanding by consumers (patients) of how to prevent and treat Type 2 Diabetes Mellitus. Uncontrolled Type 2 Diabetes causes complications that are coronary heart disease, kidney failure, blindness and amputations. Quality of life of is decreased. The complications are costly to the patients and the healthcare system.

America was in the midst of an obesity epidemic. The epidemic continues today. Obesity predisposes consumers to Type 2 Diabetes Mellitus and its subsequent complications.

Dr. Feld said everyones goal for the healthcare system is to have a healthier population at an affordable price. The goal can be accomplished by putting consumers in control of their health and healthcare dollars. Consumers must also be given financial incentives to control their health. No one is focused on the consumer’s responsibility to lower cost in the Obamacare business model.

Dr. Feld believes Obamacare’s business model has too many faults to repair. Each time President Obama alters the business model to fix a fault, the healthcare system becomes more costly, dysfunctional and unsustainable.

Dr. Feld developed a business model that would accomplish the goal of providing a functional and efficient healthcare system at an affordable cost to consumers, employers, healthcare insurance companies and the government.

Dr. Feld’s business model would eliminate most of the government’s inefficiency that absorbs 40% of the healthcare dollars. The inefficiencies must be eliminated or at least significantly decreased.

Here are Dr. Feld’s five key elements necessary to Repair the Healthcare System.

All the key elements listed are explained in detail in Dr. Feld’s blog “Repairing the Healthcare System”. Each link will have a full list of my blog posts on the topic.

The Ideal Medical Savings Accounts (MSAs).

Dr. Feld’s Ideal Medical Savings Account is the insurance model in his business plan.

Medical Saving Accounts are different than Health Savings Accounts. Health Saving Accounts are the fastest growing healthcare insurance plans. Medical Saving Accounts provide consumers with more financial incentive.

The Ideal Medical Saving Account transfers the premium dollars saved by consumers into a tax-free retirement trust that is not restricted to medical care. The financial incentive will cause consumers to be responsible for the control of their health and wisely spend their healthcare dollars.

The Ideal Medical Savings Accounts are democratic. The employer, the individual or the government could fund the Medical Savings Account. The deductible must be high enough to provide enough financial incentive for consumers to be motivated to become responsible for their health and their healthcare dollars. Once the deductible is reached the consumer receives with first dollar coverage for an illness.

If the deductible is not spent the consumer gets it tax-free in their retirement trust.

Ideal Medical Savings Accounts provide consumers the choice of physician. The environment is created where consumers decide on who will provide the best value for their healthcare dollars rather than the government, the healthcare insurance industry or the government.

MSAs would create a Consumer Driven Healthcare System with the benefit of consumers creating competition among the stakeholders in the healthcare system rather than stakeholders deciding for consumers. For greater details go to this link.

The Importance of Tort Reform

Most politicians have ignored the importance of Tort Reform. They have been led to believe that Tort Reform is an insignificant cost to the healthcare system.

Dr. Feld points to study by the Massachusetts Medical Society. Every practicing physician believes the data of this study. The resulting data is an excellent and truthful indicator of the huge cost of over-testing to prevent malpractice claims.

The lack of Tort Reform costs the healthcare system $200 billion to $750 billion dollars a year as a result of over testing by physicians to avoid malpractice suits.

Physicians who order a test usually do not receive the profit built into the test he/she has ordered.

The Importance of Self-Management of Chronic Disease

The unsuccessful management of chronic diseases results in 80% of the cost of care for those diseases. Most important is to prevent the chronic disease from occurring in the first place. Diseases with the highest costs are Diabetes Mellitus, Heart Disease, Hypertension and Cancer. Obesity and consumer’s genetic makeup are responsible for most of these chronic and costly diseases.

Consumers are in control of the development of obesity. They must be responsible for preventing it. However all of our cultural stimulation encourages obesity. Consumers must make a choice. Government can provide public education programs to help consumers make the correct choice. When consumers are educated and are at financial risk for developing obesity, they will become responsible and avoid becoming obese.

The reformed healthcare system could prevent the onset of complications of these chronic diseases. The cost of the complications of chronic disease is 80% of the cost of treating that disease.

These teams must be an extension of their physicians care and responsible to their physician.

The Magic of the Patient/Physician Relationship.

Obamacare tries to quantify patient care. Twenty thousand rules and regulations have been produced so far to measure the care delivered by physicians to patients.

Maybe the measurement criteria for quality care are wrong? Maybe the government is measuring the wrong thing.

There is no quality measurements made about patients’ compliance or adherence. There are no rules to measure the patient/physician relationship.

These would be important measurements for bureaucrats to measure in order to quantitate the effectiveness of care.

If one wanted to commoditize the delivery of quality medical care, consumer responsibility for compliance with their treatment is an important measurement.

The patient/physician relationship is magical. It can result in improved patient compliance and self-management of both acute illness and avoidance of the complications of chronic diseases. The end result is that it can decrease the cost of healthcare by at least 50 percent. The healthcare system would then be affordable.

As the government and healthcare insurance companies try to decrease their cost they have decreased reimbursement and increased regulations and paperwork for physicians

A physicians work product is intelligence, skill and time. Physicians do not have enough time to develop a patient/physician relationship today.

The patient/physician relationship is difficult to measure. It cannot be commoditized into a universal report that a computer program can generate.

The Rule of Information Technology

Physicians are not opposed to information technology. They are against information technology generating data that is being used as a tool to judge their clinical competence and reimbursement by bureaucrats. Many times the “big data” is inaccurate.

Information technology should be used as a tool to extend a physician’s ability to patients. It should be used as a tool to improve physicians’ care.

In order to reduce the cost of medical care and increase the patient’s ability to be a “Professor of Their Disease”, medical care must be delivered by a team approach.

Information technology must be a part the team with the consumer being in the center. Physicians must be the coach; the other members of the team must be physician extenders (assistant coaches).

There are many websites generating both good and bad information. As the manager of the team the physician and his assistant managers should pick the websites for his/her patients to use.

Physicians and his/her healthcare management teams should develop social networks so his/her patients can relate to each other and learn the subtleties of their chronic disease from each other. Physicians and his patient extenders would monitor and correct any false information generated through the social network.

These social networks would be very effective in motivating consumers to be responsible for their care and their healthcare dollars.

These are five elements that would decrease the cost of America’s healthcare system. They would avoid the trap and unintended consequences of a single party payer system.

The real cost curve has not been bent downward. It has been bent upward in the actual cost to taxpayers. The government is not measuring all the costs, including new taxes, as payment for Obamacare.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.

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Obamacare Owes Insurance Companies $2.5 Billion Dollars For 2014 Health Exchange Losses

October 7, 2015

inDisinformation and the healthcare system, Medicine: Healthcare System, Stakeholder Abuse of the Healthcare System, Stakeholder Mistrust

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Stanley Feld M.D.,FACP,MACE

These days there is very little news in the traditional mainstream media about Obamacare.

The average person thinks everything is fine. President Obama has told us over and over again that Obamacare is a great success.

Unfortunately, this is far from the truth as the Obama administration prepares for the 2016 enrollment period.

Open enrollment is supposed to start November I, 2015 and end January 15, 2016 for 2016.

In 2013 and 2014 open enrollment was extended many months because of poor enrollment. I suspect the same will happen during the 2016 enrollment period.

The disastrous web site is still not fixed.

The healthcare insurance industry has increased Obamacare insurance premiums by double digits. The Obamacare deductibles remain in the thousands.

Even with large Obamacare subsidies people making under $50,000 cannot afford the subsidized premiums or deductibles.

Some people are registered through both the health insurance exchanges and Medicaid. This has been recently discovered by the Obama administration.

These people have received the Obamacare cash subsidy and Medicaid coverage. Now the Obama administration expects to be paid by these recipients for the government’s overpayment.

The Obama administration has refused to publish the number of people affected.

None of these issues have appeared in the traditional mainstream media.

The Obama administration continues to publish conflicting figures about how many people are actually enrolled through its federal health insurance exchanges.

The administration needs the healthcare insurance industry to do the administrative services for the health insurance exchanges.

At the onset of enrollment in 2013 healthcare insurance companies did not want sign up to do the administrative services. The companies figured that high-risk people without insurance would sign up for insurance and they would lose money. Obamacare required that the premium would be equal for everyone regardless of the health risk.

Obamacare originally wrote into the law three risk corridor programs that would be activated if necessary to subsidize the healthcare insurance industry against undo risk.

As a result of the healthcare industry’s lack of participation in the federal and state insurance exchanges, the risk corridors were activated.

“The healthcare reform law established three “market stabilization” programs to help insurers weather the first few years of covering a new population with unpredictable healthcare needs. At issue is the risk corridors program.”

I was astonished when I learned of these risk corridors. The corridors encouraged the healthcare insurance industry to participate in providing administrative services for each state and federal exchange at no risk of loss.

It was amazing that the leading Republicans for repeal of Obamacare did not make this clear to the public.

The insurance industry was actually guaranteed a profit because they provided its own profit and lost data. The Obama administration simply accepted its data. The healthcare insurance industry was supposed to receive the subsidy for its loss.

The government’s hope was to provide enough insurance choices to enrollees in the health insurance exchanges so there would be competitive pricing.

Unfortunately for Obamacare it did not work out as planned.

“ The government had planned on releasing risk corridors data in August but waited until October 1, 2015 due to discrepancies in the data.”

I suspect the delay was for political reasons and to provide enough time for the government to present the data in a less negative fashion.

The data provided by the Health insurers that sold health insurance plans showed that those insurers lost a great deal of money on the Affordable Care Act‘s exchanges in 2014.

The data shows the Obama administration has short changed the healthcare insurers that participated in Obamacare $2.5 billion dollars promised to them in the safety value risk corridor subsidies.

The Obama administration now is promising those insurance companies that the $2.5 billion dollars to cover the deficiency will be covered with budgeted monies from 2015 and 2016 if possible.

President Obama is now sowing the seeds to blame the nonpayment on Republicans since Republicans control congress.

Republicans thought the health insurance risk corridors were a stupid idea to begin with and predicted failure. Now the Obama administration is trapping the Republicans for not wanting to pay bills that are owed.

Some smaller insurance companies who were seduced into participating in this no risk insurance policy folly are now worried about experiencing “solvency and liquidity problems”.

CMS would not give the number of companies affected. It said the cases are isolated.

“The insurers requested $2.87 billion in payments to cover their losses. The CMS will only reimburse 12.6% of the payment requests, meaning insurers will still be owed more than $2.5 billion.”

“ Names of companies that are owed money were not released.”

Does anyone think the insurance companies are going to sign up for the 2016 enrollment cycle?

Insurance companies do not know how much Obamacare will short- change them for the 2015 subsidies yet.

One can also begin to understand why insurance rates for both government and private insurance are increasing when physician and hospital reimbursement are falling.

The insurance industry feels it has to make up its loss.

Why are the Republicans not saying anything about this to the public?

Why aren’t Republican candidates for President not pointing out this folly?

Why are they letting themselves be set up to be blamed for not wanting to pay the government’s bill?

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone

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Healthcare Insurance Industry Moves Against Obamacare

July 28, 2015

inDisinformation and the healthcare system, Medicare, Medicine: Healthcare System

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Stanley Feld M.D.,FACP,MACE

The 3 R’s are not working out well for the government, the patients or the healthcare insurance companies.

The temporary reinsurance portion of the 3R’s is about to expire. It was meant to support the healthcare insurance industry as enrollment in Health Insurance Exchanges grew.

Patient enrollment figures in State and Federal Exchanges have not grown significantly in the last two years. Enrollment ii exchanges has been from high risk and elderly patients.

High risk and comprehensive coverage has meant decreasing profit for the healthcare industry.

The numbers the Obama administration publishes are confusing and mostly false. State exchanges are failing. The State Health Insurance Exchanges are causing (in states that have State Health Insurance Exchanges) greater budget deficits.

The reinsurance program is not covering the healthcare industry’s expected profit because of the redistribution of wealth component in the 3R’s.

The significance of the redistribution of profit and wealth component of the 3R’s was not fully appreciated by the healthcare insurance industry as was the reinsurance subsidy was.

The industry’s first step to combat this barrier to profit was to increase next year’s insurance premiums by 20-30 percent in both the private sector and the State and Federal Health Insurance Exchanges.

This has created inflationary pressure on the private sector and unaffordable healthcare in both the private and public sectors for consumers and companies that provide healthcare coverage to their employees.

Its effect is the opposite of what President Obama promised. He promised to make healthcare insurance coverage affordable to all.

It is also forcing corporations to switch their healthcare coverage plans from defined benefit plans to defined contribution plans. The net effect is to increase employee out of pocket expenses.

We do not know how many more people have lost healthcare insurance because of Obamacare’s rules and regulations.

The public is also unaware of the exact number of people who have gained healthcare insurance through the Health Insurance Exchanges.

The real figures are not easily available.

The next step by the healthcare insurers is to merge. A series of merger negotiations are occurring. In the last three weeks two merger negotiations have been completed.

“Anthem Inc. agreed to buy Cigna Corp. for $48 billion, capping months of merger frenzy among top U.S. health insurers that is set to reshape the industry.”

“The merged company is projected to have around $115 billion in annual revenue and cover about 53.2 million people.

The deal, which needs regulatory approval, would help reshape health insurance industry.”

Three weeks ago Aetna agreed to buy Humana for $34 billion. The two deals accelerated the rapid-fire reconfiguration of the U.S. health-insurance industries. The two deals would decrease the industry from five major companies to only three.

The traditional media has not discussed the reasons the healthcare insurance industry is merging or the details of the mergers.

I will try to connect the dots.

The healthcare insurance industry realizes that the Obama administration is trying to play one insurance company against another. The redistribution of profit from insurance companies that profit to those that make less profit must be irritating to the healthcare insurance industry.

Perhaps they did not appreciate the intricacies of the 3 Rs. Maybe there was a small window where the temporary reinsurance was profitable.

I would guess that the healthcare insurance industry would try to stop the redistribution of profit. These mergers will increase their individual profits.

The companies will be in a position to force the government to discontinue the redistribution of profit or lose a company that is an administrative service provider.

The losers will be taxpayers and non-subsidized insurance consumers. The increases in premiums to consumers that are subsidized will be passed on to taxpayers. Non-subsidized taxpayers will also be paying increased healthcare premiums.

This will create non-affordable insurance premiums for all as a result of the Affordable Healthcare Act (Obamacare).

The healthcare system will collapse. The government will move in with a single party payer system and a bloated and wasteful government bureaucracy.

Remember Senator Kerry and Representative Barney Frank saying the ACA would not work without a Public Option? Remember President Obama saying we don’t need a Public Option?

President Obama is backing healthcare insurers into a Public Option corner and a single party payer system.

The government will be forced to limit access to care and ration care. Americans will not have freedom of choice.

The problem is the government will still have to hire one of the three healthcare insurance carriers for its administrative services instead of one of five major carriers. The price to the taxpayer will probably be high along with all of the government’s bureaucratic inefficiencies.

Remember the VA? The VA scandal is continuing without any apparent improvement in VA services or in reforming the dysfunctional VA system.

Congress is simply giving the VA more money to continue its dysfunctional ways.

The latest step in the healthcare insurance industry’s attempt to protect itself is the hiring of Marilyn Tavenner as CEO of America’s Health Insurance Plans (AHIP) the lobbying group for the healthcare insurance industry.

Marilyn Tavenner is the former head and CEO of CMS overseeing Medicare, Medicaid and ACA (Obamacare) implementation.

Marilyn Tavenner oversaw the botched rollout of the federal insurance exchange and the ACA-mandated cuts in payment rates to Medicare Advantage in additional to a myriad of new Obamacare generated Medicare and Medicaid regulations.

Some of these regulations are unconstitutional according to lawmakers. However, the legislators have done nothing about these unconstitutional regulations.

They have not even attempted to make Americans aware of them.

Health Insurance Exchange plans and Medicare Advantage plans are two areas of tremendous profit and significant growth for private insurers. The Obama administration knows this and has tried to limit or eliminate this growth. AHIP hopes Marilyn Travenner can help the industry continue this growth by pointing out the bureaucracy’s weaknesses to healthcare insurance company’s executives.

“The healthcare industry (AHIP) hired her for her political connections inside the administration, inside the CMS bureaucracy and inside the congressional committees that regulate them,” said Tim LaPira, political science professor at James Madison University.”

The mainstream media parroting the AHIP’s press release said, “that the insurance industry has accepted Obamacare (the Affordable Care Act) as the new business environment. AHIP wants a CMS insider to help during the next phase of its market development.

According to the AHIP press release, “her government experience will be invaluable to AHIP given how rapidly the public sector is dominating the financial, market and regulatory facets of health plans”

It is obvious to me that AHIP did not hired Ms. Travenner in order to understand the new business environment better for an instant.

I believe AHIP hired her as CEO for her connections in,

1. CMS,

2. The Obama administration,

3. The administration’s bureaucracy.

4. Congress

Along with her impressions of CMS’s weaknesses.

Weaknesses the AHIP can exploit.

Neither the Obama administration nor AHIP are working for the benefit of the American consumer of healthcare.

This behavior must be stopped somehow.

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Double Digits Increases In Obamacare Insurance Rates Proposed

May 31, 2015

inHealthcare Insurance Industry, Medicine: Healthcare System, Politicians,Healthcare and Vested Interests, Stakeholder Mistrust

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Stanley Feld M.D.,FACP,MACE

Thirty-seven states refused to setup Obamacare State Health Insurance Exchanges. Thirty-seven states refused because of the expected cost burden to those states and citizens. States are required to balance their state budgets. Most states have deficits and do not have balanced budgets. Obamacare’s requirements would simply add to their budget deficits. States would be forced increase state taxes.

The 37 states felt that the Obamacare State Health Insurance Exchanges were an attempt, by President Obama, to decrease the federal cost burden and shift it to the states.

It was also a states’ rights issue.

None of those states felt that Obamacare State Health Insurance Exchanges could work and not become an increased cost burden.

The Supreme Court ruled in 2012 that states have the right under the constitution to refuse to create a State Health Insurance Exchange.

In June 2015 the Supreme Court will rule on King vs. Burwell.

Can the Federal Health Insurance Exchanges subsidize applicants the same way State Health Insurance Exchanges can subsidize applicants.

The law’s language is specific. The Obamacare law specifically states that only the State Insurance Exchanges can subsidies applicants.

The Obama administration media manipulation machine is already spinning the truth in case the Supreme Court rules against the federal government.

Eight million people will lose their subsidy. There are 330 million people in America. There are as many people uninsured in 2015 as there were before the law was enacted. In five years we are no closer to the promise that Obamacare would provide universal care.

Obamacare is failing because it is a bad law in many respects.

The essence of the Obama administration’s spin is that if the Supreme Court rules against the government the cost of insurance will escalate to unaffordable levels for Federal Health Insurance Exchange purchasers.

Subsidies that made insurance plans affordable face a crucial test with decision expected in June.

The truth is the cost of healthcare premiums are going to skyrocket for Obamacare applicants because the only people who signed up have pre-existing illnesses and had to buy insurance or the very poor because their insurance was fully subsidized.

The adverse selection and the financial accounting rules for the healthcare insurance industry allow them to raise the premiums.

President Obama’s subsidies for Obamacare premiums expire in 2016.

Megan McCardle writing in Bloomberg says;

“Insurance companies have been bullied by the Obama administration into keeping rates as low as they are, even though they can't make any money.

For sheer survival, most companies will begin to charge enough so they at least don't lose any money, or leave the exchanges altogether.

For those of you who have followed my blog carefully, you know President Obama has provided the healthcare insurance industry a subsidy in order to get them to participate. It guarantees that it cannot lose more than 2% of its expected profit.

The insurance industry determines its expected profit.

The insurance company subsidy is about to expire. The guarantee in Obamacare, of not losing any money, is going to evaporate. In addition, only the sickest and poorest people have obtained insurance from the federal and state health insurance exchanges. The federal and state exchanges have lost a great deal of money.

These losses are slowly being revealed.

The State Health Insurance Exchanges are starting to publish their losses at the same time the healthcare insurance industry is reporting their potential losses for next year. Those potential losses are reflected in the proposed premium increases.

Moda of Oregon says that its claims were 139 percent of revenue.

CareFirst of Maryland says claims were 120 percent of revenue.

Tennessee told the Wall Street Journal it lost $141 million on exchange plans last year.

State of New Mexico says it lost $23 million on revenue of $121 million.

The states that signed up for the State Health Insurance Exchanges are losing money. Maybe the states that did not sign up were right. It would be a financial burden on those states.

The clause in the law permits only those states having a health insurance exchange to provide subsidies to their applicants. It excludes all others, including the federal government.

The only question the Supreme Court has to consider is, can the federal health insurance exchanges provide subsidies to applicants according to the law as written?

The law was written to encourage states to create health insurance exchanges. It did not include the provision of subsidy to applicants for federal health insurance exchanges.

If the federal exchange would be permitted to provide subsidies, the law should be amended by congress.

A Republican congress would have to amend the law.

Obamacare is an apparent disaster to consumers, insurance providers, hospitals and physicians.

The majority of Republican are calling for Obamacare’s repeal.

It is unlikely that a Republican congress will change that provision in the law.

The “States only provision” in the law has backfired on President Obama and those states creating health insurance exchanges.

The cost of setting up and administering this new bureaucracy was enormous. The healthcare insurance offered by Federal and State Health Insurance Exchanges were either too expensive for healthy or young consumers or had too many unnecessary benefits for those consumers.

The only consumers who signed up were people who were too sick to be able to buy private insurance or too poor to be able to buy insurance without being subsidized.

Those consumers comprise 85% of the applicants. The result has been an adverse selection pool.

If the Supreme Court rules against President Obama he is going to say that private insurance does not work. The federal government must create an entitlement to everyone.

The result will be socialized medicine with the federal government being the single party payer controlling rationing of care, access to care and the cost of care to consumers.

I believe it will make healthcare coverage even worse than it is now.

Why no one is considering my concept of consumer driven healthcare with my ideal medical saving account is beyond me.

Rather than making consumers actively responsible for their health, healthcare dollars and healthcare, we are on the road to making them passive recipients of their healthcare.

America is going to be further down the Road to Serfdom.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.

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Physicians’ Problems With The Healthcare System

July 27, 2014

inMedicine: Healthcare System, Physician's Problems, Politicians,Healthcare and Vested Interests, Stakeholder Mistrust

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Stanley Feld M.D.,FACP,MACE

I must start this article with a disclaimer. I am a retired Clinical Endocrinologist that practiced Clinical Endocrinology for 30 years. I became involved in medical politics because I wanted to help make Clinical Endocrinology a household word. We succeeded at the American Association of Clinical Endocrinologists to make Endocrinology a household word.

At that time I saw that the medical profession was slowly being destroyed. I wanted to make whatever contribution I could to save the medical profession in order to preserve the care patients were given and help promote the progress in medical research.

Today I see the delivery of medical care diminishing and the infrastructure of medical care being destroyed by the Obama administration’s ideology coupled by government bureaucrats as well entrepreneurs that see profit in business opportunities that do not add value to medical care.

I do not have a horse in this arena anymore. The only vested interest I have in the healthcare system is that an effective medical care will exist when I need it.

How do we create systems of care that promote high performance? I do not believe it is by a series of top-down highly specific mandates. I believe it is by creating general guidelines for physicians and providing tools to help physicians advance medical therapy using advanced technology.

It boils down to policy makers’ view of physicians.

Are physicians knights to be empowered in their service of patients?

Are physicians knaves not to be trusted?

Are physicians pawns in a healthcare system to be manipulated by the powers that be?

At present, healthcare policy makers view physicians as knaves and pawns. This view has to change in order to have a functional healthcare system because people behave has you project them to behave.

If the policy makers approached physicians more as knights, physicians would once more behave as knights and not as bitter misanthropes. The result would result in a desire to provide the best possible care for their patients.

The environment is conducive to the destruction of the healthcare system. Barriers that inhibit effective medical care and increase the cost of medical care can easily be overcome if the Obama administration wanted to fix them.

The public and future administrations have to understand the barriers to effective medical care in order for the healthcare system to arrive at a future state that is not on the way to self-destruction.

America’s healthcare system needs a new vision of physicians and patients. The change in vision would result in a new business plan built around a new system of care.

The healthcare systems needs input from physicians and patients. They are the two most important stakeholders in the healthcare system. Without physicians or patients there would not be a need for a healthcare system.

The promotion of a vibrant patient/physician relationship is the keystone to a viable future state of the healthcare system.

I will first list the barriers and then explain them and their solutions in my next blog. Some of the barriers have been covered in previous blogs.

The barriers to effective and efficient medical care are causing physicians to adjusted in a distorted and destructive way. These barriers are not increasing the quality of medical care they are serving to decrease the quality of medical care.

Lack Of Malpractice Reform

Problems Trying to Increase Reimbursement

Stripped of Negotiating Clout
Turned Into Captives of the Insurance Industry
Pressured to Sell Healthcare as a Commodity
Pushed to Abandon Clinical Judgment
Under Hospitals' Thumb
Shunted Aside by Policymakers
Shunted Aside by Entrepreneurial Management companies
No One Is Advocating for Physicians

The VA Healthcare System is the perfect example of a top down Platonic approach to a healthcare system. Government bureaucracies have proven over and over again that it does not work.

The American healthcare system needs a bottom up system that is based on empowering physicians to act professionally in the best interest of patients.

The bureaucrats for a top down system should enable a higher level expectation of care from physicians and provide education about the higher level of expectations for patients.

The driver of the healthcare system must be the consumer. The government and physicians must emphasize the consumers’ responsibility in their health, healthcare and medical care.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.  Please have a friend subscribe

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Healthcare Needs Some Big Time Disintermediation

March 9, 2014

inDisinformation and the healthcare system, Medicine: Healthcare System, Stakeholder Mistrust

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Stanley Feld M.D., FACP, MACE

What is disintermediation?

Disintermediation is a process that provides a user or end consumer with direct access to a product, service or information that would otherwise require a mediator (middleman) such as a wholesaler, lawyer or salesperson.

In many cases the information available on the Internet has often eliminated the need for a middleman.

As commerce grew in the United States after WWII, there was a need for multiple middlemen to fulfill each commercial endeavor.

One of the strongest examples of early Internet disintermediation was Dell Computers. Consumers were able built custom computers by picking the components. They bought exactly what they wanted at a lower price. Michal Dell sold directly to the consumer and bypassed all the middlemen channels and normal retail outlets.

Amazon is another compelling example. It started with books and now includes almost everything. Amazon bypasses most of the channels and all of the expense of brick and mortar structures to lower the cost to the consumer.

Steve Jobs did it best with ITunes. Most people did not want the16 tunes on a CD. They might want one or two. Music publishers and all the middlemen in that industry fought him tooth and nail.

Steve Jobs won because he provided the consumer with what they wanted, the one song at 99 cents as opposed to 16 songs at $16 dollars.

The music publishing companies have now realized that they are doing better since ITunes with less middlemen and more product sales.

My son, Brad Feld, is going to disintermediate the book publishers. Brad authored 5 books for Wiley Press as part of the Start Up Revolution. Wiley Press and its bureaucracy treat him and other authors unfairly.

He and his partners at Foundry Group Venture Capital started FG Press.

“We treat authors like partners, not service providers. Instead of flat fees and unequal royalty assignments, we abandoned the old model and rebuilt it with the author as our top priority.”

I believe the FG Press results will be to disintermediate the entire book publishing industry.

Disintermediation though the Internet also happened in the travel industry, the airline industry, the stock broker industry and the banking industry.

Disintermediation cuts out the middleman.

“By using the Internet, companies and even manufacturers can deal directly with users or end consumers, which is a significant factor in decreasing the cost of servicing customers. The high market transparency often enables the buyers to pay less as they deal directly with the manufacturer, bypassing the wholesaler and the retailer. As another alternative, buyers can also buy directly from wholesalers.”

There is no reason disintermediation cannot be applied to healthcare. The goal in healthcare is to lower the cost, increase quality of care and increase access to care.

The way to do it is by making consumers the most important stakeholder. Consumers must drive the healthcare system just as consumers are put at the head of the line in other disintermediated systems that work.

I have described the evolution of the healthcare business model of 1946 to the business model of 2014 and beyond.

In 1946 the healthcare business model was simple. The healthcare contract was between consumers/patients and physicians.

Consumers were responsible for their medical care. The only technology was physicians’ car his stethoscope and his doctors bag. Consumers were also cautious in their utilization of healthcare services. They did not want to waste their money. They were responsible for their health and their healthcare dollars.

Healthcare insurance destroyed this relationship. Healthcare insurance was attractive to sick people. It was attractive to employers to help their employees stay well. It also helped employer keep their valuable labor force.

Consumers became less cautious about spending their healthcare dollars as third parties were paying for healthcare costs.

The use of technology boomed in medicine. The cost of healthcare escalated as more and more technology was used.

In 1965 the government created Medicare. Medicare regulations distorted the free market healthcare system. The distortion increased further in the early 1980s.

All of a sudden there were more and more middlemen. The middlemen added little value to the medical care of consumers/patients. However they did add increased costs to the healthcare system.

In 2008 the healthcare system became so complex and riddled with rules and regulations that enormous barriers existed between the consumers/patients and their physicians.

It looks like a giant hairball that cannot be digested.

Obamacare was invented to use technology and ideology to straighten this all out. It has made and is making healthcare more unsustainable.

Obamacare cannot work. It is government control. The majority of consumers and physicians are against it.

Obamacare destroys the patient physician relationship. Obamacare has resulted in more bureaucracy, large overhead, more middlemen and an increase in costs to the consumers in terms of higher taxes and higher healthcare insurance premiums.

The major problems are there are too many middlemen and the bureaucracy is superimposed on a failed legacy healthcare system.

The healthcare insurance industry takes 40% off the top leaving 60% of the premium dollars working for the delivery of medical care.

Hospitals charges are outrageous. Hospital expenses are inflated.

The need for cost shifting puts a large burden on hospital systems.

Government interference simply escalates costs.

An example is the cost of chemotherapy. In hospital chemotherapy cost is 2 to 3 time the cost of the chemotherapy done by the same doctor in that doctor’s office. The government does not pay for chemotherapy in the doctor’s office.

An example of disintermediation in the healthcare system is the Oklahoma Surgery Center.

“The Oklahoma Surgery Center demonstrates that it’s possible to offer high quality care at low prices. Surgeons can do twice as many surgeries in an outpatient surgery center than they can in a traditional hospital surgical suite.

Most industries try to improve efficiency. However, simple efficiencies have not occurred in most traditional hospitals. Surgeons spend half their time waiting for the patients to come to the operating room or for the availability of operating rooms and equipment.

The Surgery centers have solved these efficiency problems. They can service surgeons’ needs at less than half the cost without the wasted time.”

A key reason is there are not multiple administrators creating multiple regulations and collecting multiple $500,000 to $3 million dollar a year salaries. Surgical centers have one head nurse responsible for everything and zero administrators.

The cost of a “complex bilateral sinus procedure” at the Surgery Center was an all-inclusive $5,885. The traditional hospital bill totaled $33,505 without the surgeon’s and anesthesiologist’s bill included.”

Hospital systems in the area are lowering their prices and becoming more transparent.

Obamacare has made the healthcare insurance costs worse for the middle class. The middle class healthcare insurance premiums are not subsidized by the government.

Obamacare has made the premium cost better for the poor and sick. It has not necessarily lowered the deductible. It has not made access to care better for the poor.

Obamacare may make quality of care worse. It will restrict access to care. It will ration care. Obamacare will make medical care decisions for consumers.

The only way to repair the healthcare system is to make it a consumer driven healthcare system using my ideal medical saving accounts.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.

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What Are Private Insurance Exchanges?

September 22, 2013

inHealthcare Insurance Industry, Medicine: Healthcare System, Stakeholder Mistrust

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Stanley Feld M.D.,FACP,MACE

Corporations have been providing healthcare insurance
since after WWII. The cost of healthcare insurance has been rising since.

The increase in premiums became intolerable in the
1980’s when cost shifting occurred. Medicare decreased reimbursement and the
fees were shifted to private insurance. Several experiments in healthcare coverage
were tried to reduce the cost to employers. All the schemes failed to control
costs.

The schemes include managed care and HMO’s. All the
insurance schemes were defined benefit plans. Employees were immune from
responsibility for themselves or their healthcare dollars.

As the costs have risen to unsustainable levels
corporations have been trying to figure out how to get out of providing
healthcare coverage for their employees as a benefit.

Most employers, large and small, want to limit their
exposure to healthcare premiums and Obamacare penalties.

A movement to limit employment to less than 30 hours
a week to avoid providing healthcare insurance to employees and avoid Obamacare
penalties has become viral.

No one has tackled the real reasons for the rising
healthcare costs. No one has tackled the perverse incentives and advantages
given to the healthcare insurance industry all these years.

I have argued that this perverse incentive can lead
to all the other perverse incentives initiated by the rest of the stakeholders
in the healthcare system in order to survive.

Once more the healthcare insurance industry figured
out how to increase their profits while making it appear they are helping both employers
and employees.

It must be remembered that the healthcare insurance
industry profits through both private insurance and government provided
healthcare coverage.

The industry makes its profits by providing
administrative services. The government outsources the administrative services
to the healthcare insurance industry.

The profit generated in both the private sector and
the government sector is far from transparent.

The healthcare industry’s new scheme converts defined
benefit coverage to defined contribution coverage for healthcare benefits.

In recent months we have seen large corporations
switch their employee healthcare benefits to defined contribution programs.

A partial list of companies includes Walgreens, Home
Depot, Sears, Trader Joes, Xerox and IBM retirees.

Rather than provide a healthcare insurance coverage
benefit through the corporation, the corporation is providing employees with a
defined contribution each year. The employees can then buy their insurance
through their employer’s contracted Private Health Insurance Exchange.

The Private Health Insurance Exchanges are provided
to the corporations by the healthcare insurance industry. There will be a menu
of insurance plans and premium levels employees eligible for coverage can
choose from.

The principals of healthcare coverage include all of
the basic requirements of Obamacare’s Health Insurance Exchanges. Employees
having a preexisting illness must be accepted. However, premiums might be
higher for patients with pre-existing conditions.

The defined contribution amount has not been defined.
It could be a couple of hundred dollars a year to a couple of thousand dollars
a year. In any event it does not sound as if it will be enough to cover the
cost of the healthcare insurance premium.

There will be high deductible plans with patients not
covered for the deductibles and co-pays.

If an employee doesn’t like what he buy in the
companies Private Insurance Exchange, he can always sign up for Obamacare’s
Health Insurance Exchange.

It sounds great for the employer because the employer
can predict costs. It is wonderful for the healthcare insurance industry.

It sounds terrible for the consumer.

It sounds both good and bad for the government. It
depends on how one looks at it.

The Obama administration will have more people sign
up for Obamacare’s Health Insurance Exchanges. The result will be greater
control over the healthcare system. I believe this is the reason the Obama administration has not opposed the Private Health Insurance Exchanges.

However, the consumers signing up for Obamacare Health Insurance Exchanges will be the sickest
consumers. These consumers will use the system more than average.

This will result in an increase in the deficit and
unsustainability of Obamacare. The only way out is to increase premiums and
taxes.

This is called a “redistribution of wealth” because
people making up to $40,000 per year do not pay taxes. If the tax increases are
means tested it will increase the amount of wealth that is redistributed will
increase.

The increase in taxes will decrease economic growth.

At the present time Obamacare’s Healthcare insurance
Exchanges do not have verification software. The system is vulnerable to fraud
and abuse even if it could work.

America is just becoming aware of the fraud and abuse
in the food stamp entitlement program. The food stamp entitlement has double. The
government has not fixed the food stamp program.

It is likely the same thing will happen with the government
run Health Insurance Exchanges. It will drive the federal deficit even higher.

Even though the Private Health Exchanges shift financial
responsibility to the consumer to pay for their own insurance it does not provide
financial incentive for patients to become responsible for their health.

It does not contain educational programs to help
patients deal with their chronic diseases. It does not teach consumers to be
responsible for their health and healthcare dollars.

Obamacare does not provide these incentives either.

The only plan that does is my Ideal Medical Saving
Accounts with employers providing support while shifting responsibility to
consumers by providing incentives for patients to lower the cost of their care.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone

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