Entries in Affordable Care Act (2)

Thursday
Oct032013

Nantucket Sleigh Ride 

Back in the days when whale oil filled the lamps of Americans, men went out in ships to hunt the leviathan. From those ships they set out in small boats to harpoon their quarry, which sometimes did not go quietly into that good night. A dying whale might expend its last strength in a burst of speed, taking the men in the small boat on what was known as a Nantucket Sleigh Ride.

We are in such a position now, as a nation, experiencing this partial, strategically minimized government shutdown. I say strategically minimized because the air traffic controllers and the border patrol are still on the job. A real, complete shutdown wouldn’t last a day. The metaphorical whale in question is not the government itself. It is partly the health insurance industry and partly the whole corpus of thought that identifies government as “the problem.”

It’s not surprising that the health insurance industry and its minions in congress would want to cause chaos and exert anarchic leverage on the day that the Affordable Care Act (ACA) opens its doors. Despite the fact that we are being funneled into the toothy maw of the industry itself, the rules of mastication and digestion have been significantly altered. Insurance companies must pay out at least 80% of premiums for actual medical care. Compare that to pre-ACA payout rates as low as 50%. Insurance companies can no longer cherry pick their customers for health. Their offerings have to be standardized, which reduces their ability to bamboozle, hornswoggle, or to put it less picturesquely, cheat their customers. And so on. It changes their position from one of near monopsony (monopoly of the few) to a regulated monopsony.

Aside from the obvious financial benefits to us and deficits to them, it opens a conceptual door. That is that health care works better with more government intervention. It is but a short step from that to some kind of national health care plan, eliminating the need for private health insurance entirely. We could emulate our Canadian and European friends, cutting our expenses in half and improving our outcomes. No profit in that.

That open conceptual door leads to another, namely that government is good. A corollary of this is that bad government is not a result of some inherent flaw in the very concept of government, but a result of corrupt private influence. There is a cadre of politicians, journalists, pundits, and political activists who have made lucrative careers out of bashing the very concept of an active government. A passive and cooperative government is an appealing prospect for their corporate sponsors.

A successful implementation of the ACA is a major harpoon into the corporate blubber. Hence the panicked thrashing about.

The corporate forces have missed something, though. They sponsored and promoted a group of magically thinking ideologues called the Tea Party. The Tea Partiers exhibit a worldview that can be contained in a Dixie-cup; xenophobic, selfish, short-sighted, unscientific, and misinformed. These anti-government fundamentalists have faithfully pounded away at our government’s ability to raise money and provide services. Therein lies the problem for their corporate sponsors. Corporations are creatures of law. They are created by government fiat, protected by government courts and law enforcement, and subsidized by government. They rely on government services, governmentally administered markets, and government contracts. When the anti-government ideologues get their way, the corporate world starts falling apart. Freedom from regulation is only pleasant when those around you are still constrained.

It’s blowback, much the same as what our government got from backing the Afghani mujihadeen. Once you train them and equip them they don’t stop when they have finished off your enemies. The investment/business wing of the GOP is realizing that the crazy wing, doing the bidding of the health insurance industry, won’t stop blowing things up when they are supposed to. It’s a little late for that realization.

The thing that the corporate elite can’t and won’t allow themselves to realize is that they need an effective, active government as much as ordinary people do. They need someone to save them from themselves. That fundamental contradiction is being brought to the forefront of politics, and that is one jagged and rusty harpoon.

Hang on tight!

Wednesday
Jul252012

Medical Loss Ratio 

The other day I received a letter from my insurance company telling me that I wasn’t going to get a refund. I was reasonably happy about that, actually. The reason has to do with the Affordable Care Act (ACA) and the Medical Loss Ratio (MLR).

The MLR is the ratio of how much money a health insurance company pays out to cover medical expenses versus the amount of money it collects in premiums. An MLR of 75 means that for every $100 the company takes in it pays out $75 in coverage.

An MLR of 75 isn’t good enough anymore. In an amazing denial of insurance company wishes the ACA contains a provision requiring a minimum MLR of 80 for small group policies and 85 for large group policies (over 100 people). Companies that don’t meet this standard have to refund money to their policyholders to the point where they are at an MLR of 80 or 85%.

My health insurance provider has been paying out more than 80% of premiums, so no refund was forthcoming. Other people around the country are getting refunds, however. In Florida, one company is going to be refunding $15.7 million to 67,000 people. That company is called Golden Rule (*cough, hack*). Pardon, a little bile caught in my throat.

The Minor Heretic was once a customer of Golden Rule, back when Lake Champlain was salt water. I was on a budget, and they offered a cheap, high deductible plan. It was a good thing that I was healthy, because they provided an empty parachute pack. Look up “Golden Rule Insurance review” online and you will find a string of stories from people who were denied coverage, dropped when they got sick, or had their rates doubled or tripled without warning. Behavior like this did wonderful things for GR’s MLR. I found out while I was throwing my money down their gold plated toilet that their MLR was 52. They pocketed 48% of every premium dollar. More recently, in 2010, their MLR in Florida was 65.

No more. Thanks to that goddamned socialist ObamaCare that is going to enslave us all, health insurance companies can no longer gouge us. At least, not much.

Speaking of socialism, the MLR for Medicare, run by those bloated, inefficient, wasteful bureaucrats, is 97. No private insurance company comes near that, of course. That’s why they bribed, er, lobbied so hard against the public option provision when the ACA was being written. They simply couldn’t imagine competing with a program with only 3% overhead.

It would be a huge fight, but adding a Medicare-like option to the ACA would legitimize the “Affordable” part of the name. It would drop insurance costs by 15% or more, and might very well kill off a major part of the quasi-criminal health insurance industry.

For the moment I’ll appreciate not being screwed so badly by my insurance company. Down the road I look forward to Vermont becoming the first state with public single payer health coverage. Perhaps, eventually, all of America will realize that getting health insurance doesn’t have to mean wasting money.