Urgent Care by Minda Wilson

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Saturday 18 November 2017

The Tax Bill - Literally

The House of Representatives’ recently passed tax reform plan takes us another step closer to sending the middle class over the cliff’s edge and into the abyss.

It is the double whammy, increased taxes plus increased health insurance costs, Though touted as the largest tax cut in history, the reality is that middle-class Americans will see almost no benefit from the bill.

First, by reducing the number of brackets, many will see their personal tax rates increase.

In terms of healthcare, we are looking at 25% increases in healthcare costs for 2018. In 2019, we can expect even greater increases. Repealing the individual mandate means that people will not be punished for not obtaining health insurance. If you run the numbers, for a family of 4, you will find that unless you are spending more than $30,000 per year on healthcare for your family, you are probably better off without it. When calculating whether or not you can afford it, in addition to the direct costs of insurance and out of pocket expenses, you must also consider the cost of caretaking. If an adult is sick, you must consider the loss of income and the time off work to take care of him or her. If a child is sick, you must also consider the full-time cost of care at home, the cost of transportation for not just your child but for you as well. If managing these costs won’t bankrupt you and reduce your income to the poverty level, then you should consider getting insurance. Once you reach the poverty level, you are eligible for Medicaid and healthcare for you and your family is free.

If you decide you can afford it, whether or not you choose to buy insurance becomes a decision about hedging risk. Health insurance is supposed to be a protection against downside risk. Simply put, if you have health insurance, it should protect you from losing everything if someone in your family suffers a catastrophic illness. Catastrophic means an illness that is either prolonged or very expensive to treat.
As the middle-class moves closer and closer to the poverty line, this means more and more people will not buy insurance but choose to pay as they go; waiting until, when things get bad enough, they cross the poverty line and get free coverage. It is estimated that 13MM Americans will forego health insurance in the next year.

It’s a vicious cycle, but with fewer people purchasing insurance, and even less young and healthy people in the mix, premiums in future, deductibles in future and, co-pays will rise. For those who work for corporations who pay these costs, they will be asked to absorb more of the business’ health insurance costs.

If the Republicans really wanted to repeal Obamacare they could use the courts to do it. The only argument the Supreme Court bought for the constitutionality of the ACA was that the ACA, by virtue of the individual mandate, was a tax; a tax on people who did not obtain healthcare. By repealing the individual mandate, Congress would be repealing the basis the court used the find the Affordable Care Act constitutional. No mandate, no tax. Once repealed, the Republicans can ask the Supreme Court to determine whether or not the ACA is constitutional. If they get the likely answer, NO!, whatever remained of the legislation would be repealed.

But it's not just healthcare that the bill impacts, middle-class people should expect to pay more in taxes.

For the rich, the estate tax will be eliminated after six years. In the meantime, the exemption for inherited wealth, the amount that is exempt from the taxation, has been raised to $11 million from $5.5 million. Preferential treatment for investment income remains the same. People who live primarily on investments, not pensions or other income, or who live on inherited wealth will benefit. Otherwise, you are out of luck.

To help pay for the tax cuts, the plan would eliminate most personal deductions, with the exception of deductions for mortgage interest, charitable contributions and state and local property taxes. The mortgage interest deduction would be capped for newly purchased homes up to $500,000, and the property tax deduction would be capped at $10,000. According to Bankrate, median existing single-family home values are moving higher, averaging approximately $270,000 across the United States. This means that people who already live in higher cost of living states would lose those deductions. For example, if you live in the Bay Area, including Oakland, you are out of luck. No deductions for you.

The biggest deduction that would be eliminated is the one for state and local taxes. That deduction primarily helps people in blue states where taxes are higher. That coupled with the elimination of the Alternative Minimum Tax, which affects working people who earn $75,000 or more, means that their taxes would go up.

Small business entrepreneurs will be hit especially hard. Not only will they lose their personal deductions, but the pass-through sole proprietorships, LLC’s, S-Corps, and/or partnerships they set up to protect them will now be subject to taxation. There will be an additional 25% entity tax rate imposed. Most pass-throughs that are owned by individual currently pay less than 25% of their income in taxes.

The bottom line is if you are a working person, own a small business or are self-employed, your healthcare costs and your taxes are likely to go up.

Minda Wilson

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Friday 13 October 2017

Unaffordable Healthcare

Trump’s latest Executive Order is another swipe at Obamacare, but it does not repeal or replace it.
In general, the executive order has no force of law itself. What it does do is influence how regulations are put together. It is those regulations that represent how a law is implemented and how it is enforced. Trump’s executive order asks three federal agencies to consider possible new regulations that could help achieve certain goals, like providing more policy options for the young, allowing small business associations to provide health insurance plans that cross state lines and expanding access to short-term insurance policies, those that offer coverage for 90 days or less. It is not clear what those rules will say.

Previously Trump issued an executive order that let a broader range of employers stop offering free contraception through their healthcare plans. It said that regulations should interpret the Supreme Court Hobby Lobby decision to enable employers who have a sincerely held moral and/or religious convictions to opt out of the free contraceptive benefit currently in their policies. Loosely interpreted, an employer could be morally opposed to paying more for healthcare.

Anytime a benefit is excluded from a policy, the plan costs less. If you find paying more for health insurance morally offensive, you can now opt out of providing free contraception. It is that simple.

The other thing Trump can do is use Executive Orders to curtail the activities of the executive branch of government. This allowed Trump to use executive orders to shut down the Affordable Care Act website for 12 hours every Sunday during open enrollment, cut the budget by 40% that funds groups that help people enroll, and cut the advertising budget for the ACA from $100 million to $10 million. Such actions make it less likely people will enroll. In addition, his decision to limit enforcement of the ACA has wide consequences. Knowing that the individual mandate is unlikely to be enforced and the companies will unlikely be penalized for not offering insurance makes it less likely those people will purchase expensive exchange policies.

Trump is seeking to end subsidies paid directly to health insurance companies that help low-income people. He wants that money paid directly to the states instead. Trump is also seeking to eliminate the exclusivity requirement that all plans be conforming to the ACA and offer the essential health benefits, such as well-care like physicals and/or preventative care like mammographies, as defined in the Affordable Care Act.

The real impact of these executive orders will be felt by the self-employed, the working poor, and the middle class. What this means is that those who are not covered by group benefit plans, plans provided by their employer, are going to be unable to purchase health insurance. Not because it won’t be available, that is a false premise. They won’t be able to buy it because what will be available will be unaffordable. This year, in California, a policy covering two adults in their 50’s and their grown child will likely cost more than $20,000, with a $10,000 deductible and copays of $70 for specialist visits. Because of the exodus of young people into lower costs products that will likely result from the implementation of the executive order, the increase in the cost of this same policy could be up to 40% or more. What family can afford $42,000 in payments before the insurance company contributes their first dollar?

It should be noted that the states, not the federal government, set policy prices. Policy prices for 2018 have been set. At this point, states are not authorizing new policy types or increases in costs to offset the uncertainty. What happens in 2019, at this point, is unknown. In California, is an insurance company pulls out of the state, they have to wait 3 years to come back in. Insurance commissioners can stop the exodus of insurance companies by either making them be all in or all out. We will have to wait and see if more carriers pull out and if state insurance commissioners hold the line on cost.

Remember, State Insurance Commissioners are politicians and subject to influence. If you are angry, this is the place where your voice can be heard.

Minda Wilson

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Saturday 7 October 2017

Insurance Companies They Should Be Shot

Today, CIGNA announced that they will not cover the opioid OxyContin for customers who are insured through a job, starting in 2018. CIGNA last year said it wanted to cut opioid use by 25 percent among its customers by 2019.

What about those who suffer from bone cancer? While Angela was sick the pressure from her cancer cracked open her bones. She uses opioids, including Oxy-Contin, every day to cope with the pain. She tried marijuana, it wasn’t enough. Prior to taking her current medication, each day the pain of putting weight on her broken bones would send her into spasms until she curled up into a ball.

She suffered terribly while she was sick. After months of treatment, a miracle occurred and she went into remission.

After struggling to survive cancer, she still needs these drugs. The bones in her feet and ankles were broken beyond repair. Every time she put any kind of weight on them, excruciating pain would shoot up her legs. She found that by taking opioids she could manage the pain and even walk with a walker. Being mobile allowed her to get out of the house on her own, resume a semi-normal life, and be happy. Take the pills away and she returns to a life of suffering, the pain of walking on broken feet and breathing with broken ribs that cannot be repaired.

Angela is covered under her husband’s plan which means that she can, starting in 2018 be denied coverage for her opioid prescription. Who is her insurance company to say that she is not entitled to the drugs that make her able to play with her grandkids, read a book, or watch TV without curling into a ball of pain?

The insurance companies say that OxyContin is addictive and by not allowing access to the drug, they are preventing people from becoming addicts.

"Our focus is on helping customers get the most value from their medications — this means obtaining effective pain relief while also guarding against opioid misuse," said Jon Maesner, Cigna's chief pharmacy officer on Wednesday.

They said that they “might” allow prescriptions to be honored that they determine are medically necessary? What this means is that people like Angela, who are in horrific pain, will have to wait each month until the insurance company decides its OK to give her her medicine. Who are they to determine what is medically necessary and what is not? They are not doctors, they have not seen any of the patients whose treatment they are denying? Does this mean that if they don’t want to pay for it you can still get the prescription if you pay for it yourself? Isn’t that just another way of insurance companies avoiding payment for things you thought you were covered?

Because some bad doctors and some bad people have abused their prescriptions, CIGNA is deciding they are going to deny life-saving treatment to those who are in need. When did the insurance company staffers start practicing medicine? How is it possible that in most states, it is illegal for people to practice medicine without a license, criminal to write prescriptions without a license, and yet, these companies are deciding how much of what drug you can take and for how long?

Maybe the real issue is that they want to save money? Did anyone consider that? Doctors who comply with the law provide oversite to try and determine whether their patients have become addicted to opioids. Today, doctors write prescriptions one month at a time. If they want their prescriptions renewed, they have to visit their doctor monthly; urine tests must be run to assess the level of drugs in their system. In addition to the prescription, all this costs money that the insurance company is under an obligation to support. Perhaps instead, they should monitor doctors who do not put people on a monthly cycle by checking visits and urine test charges? I thought doctors were supposed to determine how sick you were, and prescribe accordingly?

CIGNA is clearly making medical decisions about what treatment patients should receive. What insurance companies are supposed to do if a doctor deems a treatment is medically necessary is pay for it. That is why you bought the insurance in the first place.

That they do what they are supposed to so should not be the exception rather than the rule. Of course you have to meet your deductible and pay your co-pay if those things apply; but, otherwise, insurance companies are not supposed to step into the shoes of your doctor and decide what is medically necessary and what is not.

Minda Wilson

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Wednesday 20 September 2017

Republicans vs. Democrats – Someone should spank them both

In the recent weeks,
Republicans and Democrats have again put their hat into the ring that is healthcare reform. Republicans still want to honor their promise to repeal and replace. Democrats want to protect their legacy. Since neither plan considers affordability, either way, the people will suffer.

Republicans have revised their plan in hope that they can get something passed before the end of the month. If this happens, they will avoid having to start all over and create a new bill. Their plan replaces tax subsidies; instead of the government paying money directly to insurance companies they will make payments to the states in the form of block grants. People would be able to increase their contribution levels to Health Savings Accounts and other pre-tax benefits. The states would use the money to subsidize their own health plans. The penalties for uninsured individuals who are uninsured as well as corporations who do not offer insurance would be eliminated. Limits would be placed on Medicaid spending. And, hard to believe, the repeal of the medical device tax, which has been on the agenda since day one, is also on the table.

With no federal programs in place, the states will have to create their own. Since health insurance is still controlled at the state level, this would not make significant changes in the markets. The financial and other safeguards that were put in place, i.e. no preexisting conditions, no higher premiums for older adults, would be determined at the state levels. With subsidies gone, and if the federal government continues to limit payments to the states for Medicaid and other programs, it is likely the level of care available will be affected. Each state would decide who would be protected and how. Just like it was before Obamacare.

All these changes do nothing to control the cost of insurance. Insurance companies can still charge whatever they want. It is still up to each state’s Department of Insurance to set prices; and, so far, these institutions have done nothing to control runaway insurance premium costs. The Democratic answer seems to be Bernie Sanders’ latest proposal “Medicare for All!”. The first problem is that the government actually pays for very limited coverage, Parts A and Part B only. The rest is covered only if seniors purchase supplemental insurance.

Senator Sanders’ own state adopted such a single-payer plan. It lasted less than a year. When Vermonters found out that to keep the program going without filing bankruptcy they would have to raise their state income tax payments from 14% of income to 24% of income, they chose to abandon the program.

Paying out an additional ten percent of one’s income proved too much a disincentive for Vermont’s citizens. That is in a state with relatively few illegals, a relatively healthy population, and low healthcare costs. You can imagine the financial impact such a plan would have on a national scale. A 10 percent increase would be nothing when you start adding in the cost of illegals, the underinsured, etc.

The solution to all of this is rather simple. If health insurance is treated like a utility, we can regulate the money that comes in and make sure that money is used to pay for medical expenses instead of health insurance oversight, review and administration. Maybe if the legislation focused on that, we might get somewhere.

Minda Wilson

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Thursday 3 August 2017

Why have we become so afraid of standing up

Why have we become so afraid of standing up to the insurance companies?

Anthem is pulling back from 16 of 19 pricing regions in California. 59 percent of current enrollment, about 153,000 California’s will lose their existing coverage in 2018 and will, hopefully, find another plan that allows them to keep their doctor on the exchange.

Brian Ternam, President of Anthem Blue Cross of California, said the individual market in California has become unstable so he believes they can no longer offer individual plans.

Trump is threatening to cut subsidy payments for low-income individuals.

From the insurance company’s point of view, this means that, if an individual pays their portion of their insurance premium, even if the government doesn’t pay, the insurance company must pay their portion of all covered expenses for that individual. To get the money the federal government owes them, the insurance company must sue the fed government to collect.

But Ternam’s statement is not true. Anthem is offering individual plans, but only in 3 pricing regions. They are doing this so that they do not lose their right to come into the market in 2019; which would happen If they pulled out altogether.

What is most interesting is that Dave Jones, the California Insurance Commissioner didn’t grow a pair and take a stand.

Even though Anthem is leaving 153,000 without individual coverage, Anthem will still be offering employer provided insurance, Medicare Advantage, Medicare Supplements Policies, Medical Policies, and grandfathered plans purchased before March 2010.

Since he has negotiated with insurance companies in the past, it seems that Commissioner Jones was very capable of cutting a deal. “You, Anthem, want your business, Medicare, Medical plans approved; you want to do business in this state; you have to offer policies in all 19 pricing regions under the same terms and conditions as you are offering them in the 3 remaining regions. You are either all in or all out!” It is inconceivable that Anthem would choose closing its doors altogether rather than find a way to offer policies in the individual markets.

Why have we become so afraid of standing up to the insurance companies?

Even without Anthem, there is sufficient interest from other carriers so that no pricing region in California will be without a coverage option. If one door closes, another door will open.

Minda Wilson

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Tuesday 1 August 2017

What Happens If

What Happens If the President Pulls the Plug?

Everyone is worried about rate increases in the President pulls the plug. That is the farthest thing from insurance company’s minds. The rate proposals for 2018 have already been submitted to the states. Each state’s department of insurance is then responsible for reviewing and approving and/or rejecting the rate proposals.

If the rate proposals are accepted; the insurance companies are on the hook to offer insurance at the rates that they proposed. If they are no longer willing to offer certain plans at the rates they originally proposed, the states have the absolute right to bring down the stick.

They are allowed to say to any insurance company “you don’t want to offer individual policies at an affordable rate to our citizens; then we will not let you offer the extremely lucrative Medicare and/or Medicare Advantage, and or group insurance programs, etc., that you want to offer in our state.

No individual plans mean you are out of business.

Your license is revoked; you are done!

If all the states decided to do this, then the CEO of United Health, who earned more than $100 million last year, would be out of a job.

It is that simple.

It is not Washington that can help you fight these massive increases it is your state government.

Minda Wilson

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Wednesday 26 July 2017

Republicans quickly reject their own revised bill

Yesterday, Senators voted for debate, not passage. Once they agreed to debate the first thing the Republicans did was quickly reject their own revised bill, the Better Care Reconciliation Act, once their leading proposal for repealing and replacing Obamacare.

The Senate rejected the bill, 43 to 57, despite having added a provision from Sen. Ted Cruz (R-Texas) favored by conservatives and another from Sen. Rob Portman (R-Ohio) to court centrists worried about Medicaid cuts.

The Cruz provision allowed insurers to offer several plan types including cheaper plans that cover smaller ranges of benefits as long as that state offers one plan that has the broad coverage required by Obamacare.

The Portman provision, the Medicaid wraparound, provides $200 billion dollars of support to states whose Senators were concerned about cuts to their Medicaid programs. The incentive of $200 billion for their states was not enough. Of the 57 votes against, 9 were Republicans.

Minda Wilson

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Tuesday 25 July 2017

its bad and know it will negatively impact Americans.

"It's a sad day when..."

It's a sad day when your Senator votes yes for a healthcare bill even though they know its bad and know it will negatively impact Americans. The Senators feel they have to vote yes in order to meet their promise to advance the ball on repeal and replace.

"Even Senator McCain, a man who is dying of metastatic brain cancer, who has nothing to lose, voted yes for debate, even though he is not behind the bill as it stands. Remember, the Senators voted yes for debate, not passage."

They did it because voting no would mean that they are
"telling America that they are fine with Obamacare".

Minda Wilson

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