psychpol

December 7, 2012

UNDERSTANDING HEALTH CARE

Filed under: Psychology and Politics — psychpol @ 3:18 pm

How does our health care system work?  What is on the horizon?  What does this mean for you and your loved ones?

When the Affordable Care Act (ACA), also known as Obamacare, was narrowly passed, it appeared to promise health care for all Americans. It is about 2500 pages in length, and has generated thousands of regulations to date.

Remarkably, this piece of legislation accounts for one-sixth of the American economy, and has no Republican signatures on it. Not one.

By contrast, the bill creating Medicare, a system of care for Seniors, had strong bipartisan support. Its original cost estimates proved to be incorrect.

The Medicare program now costs seven times what was originally estimated. It is near insolvency, and there is an unwillingness on the part of the Democrats to modify this entitlement. During the 2012 campaign, Romney proposed such modifications as raising the eligibility age and means testing.

The latter refers to the simple idea that if you have so much in assets, you would pay more for Medicare. Conversely, those with fewer assets would pay the standard amount.

To a slight degree, this is currently the case. Seniors with a certain number of assets pay a slightly higher amount per month, usually withdrawn from their Social Security benefit.

Obamacare, or the ACA, slated to be fully implemented in 2014, is already partially present in the marketplace. Insurance premiums have risen since this act was passed, in spite of promises to the contrary by Obama and the Democrats.

Retiring Senator Max Baucus (D – Mt), one of the architects of the ACA, recently called it a “disaster.” Reassuring, no?

Essentially, the ACA is designed to include about 30 million Americans who did not have insurance coverage. This group has been referred to as ” the working poor.” The ACA transfers partial financial obligation for this population to the states as the program rolls out.

The Federal portion will be partly funded by $716  billion that the Obama administration has taken out of Medicare, either through direct reductions in funding to programs such as Medicare Advantage, or cuts in services for seniors.

So, what are the current options for health insurance?

If someone is below certain income levels that define poverty, for example welfare recipients, they are probably eligible for coverage through Medicaid. This is a state administered program, partially funded by the Federal government.

If someone is over 65, they are eligible for Medicare benefits, and if they worked, have paid into this program during their working lives. Others over age 65 may have not worked, but still receive benefits.

If someone is disabled, and has so qualified, they are eligible for Medicare as part of the Social Security Disability program.

If someone is able, either personally or through an employer, they are likely to have private insurance such as Blue Cross, Blue Shield, Mutual of Omaha , United Health Care or many others.

If someone is injured on the job, they may receive health care through Federal or State Worker’s Compensation programs aimed at rehabilitating that individual for return to work..

So, Obamacare, while very complex, with twenty new taxes affixed to the legislation, aims at two broad objectives.

The first is the inclusion of “working poor” in the Medicaid benefit program. This forces states to pay out more benefits since the Feds only pay some portion of these dollars.

The second is to control the health care system by placing the Federal government in charge of provider reimbursement, service authorization, cost control and other factors for eligible patients.

This is very different from a private insurance policy.

However, goes the idea, if government can lower the cost, perhaps through deficit financing of its health insurance plan, consumers will tend to choose that program.

It would be cheaper for the consumer, furthering government control of the industry.

Such a consumer choice would assume equivalence of care quality and service availability with the government program. Is it any good?

If cheap enough, employers that offer health insurance might also opt for the government plan. This would reduce their costs. This is already underway, with employees being terminated or having their hours reduced to avoid their qualifying for Obamacare.

Well, what system do we have NOW? What are the basic workings of our health care system today?

Your doctor will perform a particular procedure. That procedure has a CPT code, and this is how the service is billed to an insurer.

Depending on the complexity of the service, the billing rate will vary. Multiple CPT codes may be used, each with its own charge.

An exception might be a provider, such as a mental health clinician, who charges by the hour, and uses a single CPT code.

The provider can set any rate that they want. For example, they could bill $100,000 for a physical examination.

However, if they have signed up to be a part of a provider network, they will only be reimbursed at the agreed upon rate set by the insurer. This is true for government programs and private insurance programs. So, your doctor may bill an amount for a surgery, let’s say $6000, but Medicaid or Blue Cross or whomever may only pay $1800.

The provider is unable to bill you for those extra amounts. If the doctor is in the provider network for that insurer,  he/she has contractually agreed to write off the remaining amount.

The same is true for hospitals, nursing homes and other care settings, like physical therapy clinics. Insurance pays a fixed amount per CPT code.

Obamacare aims to establish Health Information Exchanges (HIE) in each state. They have given states the opportunity to create these and bear most of the expense.

HIEs would provide data as to various policies in that state, including the Federal government plan, allowing people to choose their health care plan under government oversight.

Currently, several states are refusing to implement the HIE. The ACA law states that HHS, the federal agency for Health and Human Services, then has the power to set up an HIE in any state. This would remove the cost burden from that state.

Insurers, by law, can not sell their products across state lines. For example, Blue Cross of Washington and Alaska can generally operate in those states. They may seek exceptions from government, but that is subject to state approval, both the home state and the proposed expansion state.

Many private insurers are regulated by the state, and are not true public companies. Some may apply for that status, with or without being successful, depending on the decision of the state agency involved.

Others such as United Health, Humana, Aetna, Mutual of Omaha, etc. are listed public companies, and one can purchase their stock. They have a broader reach than those limited to a particular state.

A further exception involves government programs for Medicare, whereby national insurance companies can offer Supplementary Policies (Medicare Parts A – inpatient care and B – outpatient care), and Prescription Benefit Plans to Seniors, the latter called Medicare Part D.

There are no state limits on supplementary insurance programs, thus producing price competition that benefits the consumer. These programs will augment the standard Medicare benefit, which normally pays 80% of the allowed Medicare charge for a service (but not outpatient prescriptions). The latter are covered by the Part D plan which is purchased privately by the senior.

Your doctor bills $500, Medicare or Medicaid allows $200, then the government will pay $160 (80%) to the provider.

If you have a supplementary policy, that may pick up the $40 difference in payment to your doctor. If you don’t, the doctor typically writes off that cost.

If you examine a government program and the benefits allowed, you will see a myriad of exceptions. We will pay for this but we will not pay for that.

For example, paying only for a limited time in the hospital or a care center, or not paying for certain services considered to be policy exclusions.

Or they may not pay for the treatment amount that your doctor has recommended. You can have three mental health or physical therapy visits, not the ten that your doctor believed to be right for your treatment.

Of course, your doctor knows you face to face. The bureaucrat making the decision has never met you.

Are we having fun yet?

It is quite complex and confusing, even for many of us who have worked in health care. And that is without Obamacare and the over 15,00o pages of regulations now completed, with more to come by 2014.

Nonetheless, Obamacare promises that we may all be part of a government program eventually!

The notion is that the Federal government will offer lower rates and eventually put private insurers out of business, thus moving us toward socialized and nationalized, single payer medicine.

This is a classic goal for leftist ideologues like Obama and many Democratic colleagues in the House and Senate.

This goal appeals to many people, though many do not understand the implications for access to services, quality of care, availability of well-trained doctors, medical research, pharmaceutical advancements and other core factors in the system.

Others do not care to understand the issues, and simply wish to be given something by the government.

Take care of me because I deserve it. Or punish those greedy insurance companies.  Tax the evil rich.  Standard leftist positions. Dependency and rage mix well together.

The antipathy of Obama and other leftists toward the medical profession is well-known. One recalls his famous comment to the effect that if you bring your child to the doctor, they will “yank out their tonsils” just for the sake of billing for an additional service.

Insulting stuff. However, the AMA, an organization that represents only 20% of US doctors (wonder why?), and the AARP, alleged advocates for seniors, both backed Obamacare. They have since questioned their original endorsement.

Many of us in health care wish that politicians or lawyers (Obama is both) would have the same ethical standards as doctors.

The ACA creates a key committee of 15 members appointed by the president. They are not required to be health care professionals. Their function is to control government program costs, and manage the disbursement of care in order to do so.

This group has been called a “death panel” by some conservatives.

They have several tools available to manage costs. Think about it.

If you are a health care provider, doctor, hospital, physical therapist, etc., your industry has been characterized by increasing costs (electricity, medical supplies, price of an MRI unit, staff costs and many more), but your revenue has been declining.

Insurers generally pay less for a service each calendar year. A 20% cut in reimbursement for doctors seeing Medicare seniors is a frequent proposal.

That is not a viable business model. So, the doctor can drop out of provider networks like Medicare and bill  patients directly for the full cost of services provided. Some will afford it, some will not.

Or, you can simply stop seeing Medicare and Medicaid patients, including the new Obamacare group created by the ACA. Such a trend is well underway in our communities.

Currently, many doctors will not see a new government-funded patient.  So, seniors, poor people and the working poor may not have access to a primary care doctor or a specialist.

Minor detail, right? Not to the clueless, wealthy Washington DC politicians, who, by the way, have superb heath care insurance.

Why don’t they vote themselves into the ACA plan if it so great? A movement is currently underway to exempt the President, Vice President, Congress and Federal employees, and their dependents, from Obamacare.

The Obamacare panel can also control costs by cutting service authorizations.

If you are a 75-year-old person with a chronic illness, and you have broken a hip, surgery may be denied based on longevity and productivity projections for your life by the government.

Is this person’s life “worth” authorizing the care dollars for this service? Who will decide the criteria to be used?

Or, instead of twelve physical therapy rehab treatments after the hip surgery, you may only be authorized six, even though your provider knows, and scientific literature demonstrates, that you probably need twelve.

This cost control strategy is called management by benefit. Limit the benefit, reduce the cost of care.

Government can actually use whatever criteria for service denial that they wish. Just factor in the cost of some litigation, if they are not indemnified by law, and it denial of services  still saves the program dollars. Tough luck for the real person.

These are common practices that result in care rationing by all nationalized and government controlled health care systems.

For example, we, the government have 10 million seniors and so many dollars. How much should we authorize per service and what should the denial criteria be for hip surgery and rehab, or any other illness and treatment?

The third tool the panel has available is to simply not pay for a service. So, you learn about a promising treatment for cancer, but the panel refuses to pay for that service.

Remarkably, Obamacare also usurps the traditional research function of the academic health care community by deciding which treatments are worthy of reimbursement!

This is a power that will retard medical progress in our country. It shows the remarkable arrogance of Obama and his Democrat minions.

Politically appointed bureaucrats, not doctors and university researchers, will determine the “best” treatment options for you.

So, the ACA takes decision-making away from you and your doctor. It is now a government matter, in spite of the very personal nature of your health care decisions.

Either people truly get it and want this, or they do not understand it.

And with the Federal government, there are usually strings attached, no?

An exception might be welfare programs such as AFDC where the Obama administration has diluted the work requirement that, under Clinton, was mandated in order to receive a government check.

So, in health care, many doctors now plan on retiring early. Very few want their kids to go into medicine.

Some have developed new practice models such as boutique medicine. This means that I pay you X dollars a year for my care, and we bypass insurance programs and their limits for most care services.

Some providers have dropped out of government insurance programs. Some no longer take any kind of insurance, government or private.

The net effect of Obamacare is a larger pool of patients coming into the system, and fewer doctors to see them. For doctors, there is less motivation to be part of such programs.

The common  theme for Obama and the Democrats is of course let’s punish those greedy doctors!

So what if they have many years of education and training? Like all the “rich,” say the leftists, they are exploiting us and must be controlled by a “caring” centralized government.

The average Family Practice physician earns $138,000 per year. This requires a minimum of 11 years of university education post high school.

 Wonder how much we pay our senators and representatives? Our President, his aides? Their lawyers. On and on.

Currently, we have far more law students than medical students in America. Encouraging for the future, don’t you think? Everyone can sue everyone.

The punitive government approach toward some of our best and brightest will damage the medical profession and reduce innovation, implementation of new technologies and quality of care.

We will move from the world’s greatest health care system to a mediocre government-centric system, in which care is not available for all and accessible providers tend to be the least qualified.

I mean, who wants to be run by the Federal government in their profession?

Need more doctors? Dumb down medical education, just like what has happened to higher education in general.

So for those who think health care is a  “right” or Obamacare will take care of you, a big surprise is coming. You will not like the hoops you must go through, or routine policies such as denying  or limiting needed services for you or your family.

A compassionate society should make health care available to all. And, currently, there is no one in America who can not secure needed services.

Why doesn’t the government address catastrophic care for all people if it wishes to help all of us in our time of greatest need?

You can even be an illegal immigrant and use American hospitals and other services. Look at how much California pays annually to offer such services.

They are only over thirty billion dollars a year in the hole. Anyone for 13.3% percent state income taxes, and rising?

Many hospitals, clinical providers and government-funded clinics now offer charity care for those in need. No one is left in the street.

Under the ACA, it is projected that 30% of hospitals and nursing homes will shut down because of reduced government reimbursements and increasing costs. Look at the number of small, rural, community hospitals that have already closed their doors, about 50%.

There will be fewer providers available for more patients.

And for you healthy folks who choose not to buy mandatory insurance, the IRS will have 16,500 agents to track this. You will be fined several thousand dollars each year if you fail to play the game. And there are requirements that you buy a complete insurance package, not just catastrophic care.

Ah, yes, the liberals version of “freedom.” More to come, folks. It’s for our own good. Eat your spinach!

There really is no free lunch, promising as it may sound when spun by ACA advocates such as Kathleen Sibelius, Secretary of Health and Human Services.

They can PR this thing all they want, and do (check out www.hhs.gov), but the substance of what is happening will greatly damage what used to be the world’s finest system of health care.

Many now come from countries with nationalized health care for our services here in the US. Why? Better care and more readily available access to services.

A needed MRI in Canada can take up to one year to secure. Guess what happens to an untreated, advancing illness during that period.

So, here are some basic ideas regarding how health care works, the politics, and what is coming for our country in this very private area of our lives.

Government’s record in implementing programs is very poor. They have a record of consistent inefficiency, bureaucratic boondoggle and decisions that defy common sense.

Note the current scandal with victims of Benghazi and Superstorm Sandy, the government inefficiency and incompetence, and the biased media’s unwillingness to, unlike Hurricane Katrina, confront government ineptitude here. Look at wasteful crazy spending, sending weapons to our enemies and on and on.

Such is the way of government, though some like to imagine it as a benevolent parent. Watch out, the milk is sour.

Or as one former president said, the most dangerous nine words in the English language are: ” I’m from the government and I’m here to help.”

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