We interrupt this blog for Breaking News.

We have the results from the latest poll. We asked the students of Mr. Miller’s 4^th grade class, here in East Podunk, Ohio, who they would vote for if the election was held today.  And this is shocking!  These student voters are equally divided – 33% for Donald Trump, 33% for Hillary Clinton, 33% for Beyoncé, and 1% for John Kasich.  This is the first poll we’ve taken that has shown Kasich ahead of Jeb Bush.

4^th graders.  Could the report be accurate?  Yes.  Could it be 100% true?  Sure.  Does it mean anything?  Absolutely Not.

Saturday’s Plain Dealer had a front page article – In 3^rd year, NE Ohio insurance costs drop 6.3%. For most of you, that number is as real as Beyoncé’s electability.

All of the new individual policies, purchased on or off the government’s Exchange, renew on January 1^st each year.  Like my fellow agents, I have been reviewing the records of several hundred clients since the information was released a little over a week ago.  One client at a time.

I have yet to see even one rate decrease.

How can that be? Where are these rate decreases?  My Anthem PPO clients, people who wanted a clear path into University Hospital, did not see their premiums shrink.  And Medical Mutual of Ohio, the E Ticket into the Cleveland Clinic, had rate increases of up to 27%.  How could the Plain Dealer be both 100% accurate and 100% irrelevant?

The answer lies at the heart of the Patient Protection and Affordable Care Act (PPACA or Obamacare).  The focus has never been on health or health care reform.  The point of the law is to reorganize how medical providers get paid.  And, herding lower income people into lower cost providers is more efficient than allowing them to ring up big bills at expensive facilities that are eventually written off.

I went on to healthcare.gov today and looked at the least expensive policies for me, a 60 year old living in Cuyahoga County. Please remember that rates are gender neutral and that there are no health questions.

The lease expensive policy, $434 per month, is from Ambetter Insurance.  The deductible is $6,800.  This policy sends you to Metro Health and St. Vincent’s.  More importantly, the Cleveland Clinic and University Hospital are not in their network.  Never heard of Ambetter?  Don’t want them?  Too bad.  They have lots of options on the Exchange close to this price point.  None get you into U.H. or the Clinic.

The next insurer is CareSource at $444 per month with a $6,650 deductible.  CareSource’s Medicaid policy has a great network, but if you are paying all or part of your premium you are again looking at a policy that fails to include University Hospital or the Cleveland Clinic.

Molina’s least expensive policy comes in at $468.  Still no University Hospital of Cleveland Clinic.

Aetna has introduced a full portfolio of innovative group policies that provide great access to all of our major hospitals.  Their least expensive individual policy at $520 per month does not.  The deductible is $6,450.  The doors to U.H. and C.C.F. are closed.

HealthSpan, an HMO, has a $4,500 deductible policy at $566 per month.  This is the least expensive policy on the Exchange that grants access to University Hospital.

The new Anthem HMO policy is also $566.  This policy has Anthem’s smallest network.  Neither University Hospital nor the Cleveland Clinic are included.

HUMANA has a $6,450 deductible policy at $567 per month.  University Hospital is in their network.

Medical Mutual of Ohio’s workhorse policy, the $6,000 deductible 100% plan, is $569 per month.  This plan utilizes the old SuperMed Plus Network.  It includes the Cleveland Clinic and the suburban facilities of University Hospital.  This is not an HMO and it does not require a referral to see a specialist.

$569! It takes eight different insurers and over a dozen policy options to get to a policy that provides easy access to the majority of doctors and hospitals in Greater Cleveland. The price for access isn’t decreasing.  It is increasing.

Are the rates decreasing on the Exchange? Sure.  We are getting more and more offerings from the Ambetters, Molinas, and CareSources.  But if we flood the market with Yugos, does it mean that the price of cars is going down?

The Plain Dealer reported that the price of insurance has decreased. Perhaps a more complete article would have noted the influx of limited access carriers.  Would you really pay $434 – $566 per month to go to Charity Hospital?  Do you really care how many 4^th graders support Donald Trump?

The news can be so depressing. Bad news 24/7. It is hard to believe, based on what is reported on FOX, MSNBC, or even CNN, that anything is getting done in Washington. And that is why I am particularly happy to devote today’s blog post to some good news.

President Obama signed into law H.R. 1624 last week. Yes, there are laws, bipartisan laws, getting through Congress. The Protecting Affordable Coverage for Employees (PACE) Act is legislation that will allow states to define the size of small groups for health insurance purposes.

The Patient Protection and Affordable Care Act (PPACA) changed the size of small groups from 2-50 to 2-100 as of January 1, 2016. The new regulations, especially community ratings, have the potential of eliminating group health coverage for hundreds of thousands of employees and their families. The PACE Act fixes the problem.

Many of my readers and clients wondered why I went to Washington in February. “Why waste your time and money?” they asked. PACE was one of the major issues on our agenda. Our elected representatives paid attention to me and my peers because they understood that we were there in Washington for our clients, not ourselves. We were able to impress upon them that fixing this and other issues didn’t mean that they agreed or disagreed with Obamacare. This was just constituent service.

This bill was sponsored by Representatives Brett Guthrie (R-KY-2) and Tony Cardenas (D-CA-29) in the House and Senators Tim Scott (R-SC) and Jeanne Shaheen (D-NH) once it got to the Senate. The President quietly signed the PACE Act into law Wednesday evening. The House, the Senate, and the President stripped the politics out of this and simply worked together to get something done. This is proof that our leaders are still capable of working in our best interest.

Our other big issue is “Grandmothered” policies. These are the policies that were issued with an effective date between April 2010 and December 31, 2013. I have mentioned that my personal health policy would be twice as much under the new law. Twice as much, over $600 per month.

The good news is the “Grandmothered” policies are still around for another year. The renewals are coming in and the rates are still terrific. Agents and our trade groups are committed to fighting for our clients and the option to retain these older, more affordable policies. And just like PACE, we know that the key to success is getting Congress to understand the scope of the problem.

The PACE Act may be the feel good story of 2015.

The check came in the mail earlier this week. My check. Made out to me personally. And I couldn’t be happier. One of the most touted provisions of the Patient Protection and Affordable Care Act (PPACA) is the MLR, Medical Loss Ratio. This check was my rebate.

The PPACA requires an insurer to issue a rebate to each client if it does not spend at least 80 percent of the premiums it receives on health care services. Allowable services include actual medical claims, activities to improve patient safety, and efforts to improve health care quality. The other 20% may be used for administrative costs, salaries, advertising and agents.

Last year my insurer, Anthem Blue Cross Blue Shield spent only 79.70% of a total of $340,647,389 of premium dollars on health care. They had to issue rebates since they fell .30% short. My check, my share of this windfall was $7.90.

I think I’ll go to Vegas.

Photo credit – Jeff Bogart

Above is my picture of Speaker of The House John Boehner. It is an empty wall. John Boehner is consistent, bland, a blank slate perfect for you to project your darkest fears. John Boehner is everything you don’t want him to be.

The left viewed him as a right wing ideologue and political hack, especially in the early 1990’s. He was one of the Gang of Seven that helped to take control of the House. But in recent years the new right and true believers have cast him as a villain, a compromising “Squish”.

Human beings are always more complicated than the easy caricatures.

This link is to the Pope addressing a joint session of the U.S. Congress. Sitting behind the Pontiff, coincidentally, are the two highest elected Catholics in U.S. history. And it must be noted that both men, Vice-president Biden and Speaker Boehner, are devout Catholics. This is one of the most important moments in their lives. It was John Boehner who invited the Pope.

John Boehner. Most of us know John Boehner as the guy who passed out checks on the floor of the U.S. House of Representatives, or as the first person of color (Orange!) to serve as Speaker, or as the Great Crier.

But John Boehner is more than that. He is a cloth coat Republican. There are plenty of stories of his upbringing and early life spent, starting at the age of eight, working in the family bar. He does possess core beliefs and values. He is also capable of hiding those values and principles.

The easy example is Obamacare. Congress has voted over fifty times to repeal, defund, or emasculate the Patient Protection and Affordable Care Act (PPACA). The vast majority of those votes were simply for the record. These were politics at their most cynical. The Senate cast its last meaningless vote in July. The House will have to schedule another after Christmas at the latest.

But Boehner and Senate Majority Leader Mitch McConnell don’t want a repeat of 2013. They allowed the unrepentantly cynical Senator Ted Cruz (R-TX) lead the true believers to shut down the government over Obamacare. What a mess. And now Cruz, et al want to shut down the government over Planned Parenthood.

It is one thing to fake a fight over Obamacare. It is quite another to be forced, as he inevitably will be, to keep our government working by resolving the funding of Planned Parenthood. John Boehner, an institutionalist, did not sign up for this fight.

So there was Catholic, Human, Speaker of the House of Representatives John Boehner sitting behind his Pope, a man who knows what he believes and lives what he believes. One can only imagine the quiet reflection, the silent confession of the moment. John Boehner could no longer pretend that he didn’t know the consequences of his actions, the cynicism he has sown over 20+ years in Washington.

The Pope forced him to see himself.

Let us take a moment to wish the Speaker well. Let us also cut through the fog and see the reality of the PPACA.

As recently as two weeks ago I was approached by a banker who asked how a Republican President would eliminate Obamacare. I explained, again, that we aren’t going back. In ways big and small our system is forever changed. So if you are holding out, in some quixotic protest, from signing up for health insurance, get over it. The Shared Responsibility Payment (Tax) is too high to ignore.

It is time to ask your representatives, both Democrats and Republicans, how they will fix the PPACA and make it better. There are serious bills floating around Washington. Our representatives will be reviewing how long we can keep the policies that were purchased prior to 2014, how large is a small group, and which employees are really full-time and need to be covered. These and other tweaks affect all of us. Now is the time for real votes and serious collaboration. We can no longer afford cynical politics.

This has been an important week. For Jews, we had Yom Kippur, The Day of Atonement. And our Catholic friends have witnessed a miracle. The Pope forced a blind man to see.

We are only a few months away for the next Open Enrollment, the annual opportunity to rethink your individual health insurance policy.   Many of you earn too much or too little to qualify for a Tax Credit Subsidy. If you don’t qualify for a subsidy, due to income or for any other reason, you don’t need to go anywhere near healthcare.gov or the national frustration number. And, this post isn’t for you.

Today’s post is specifically for those of you who will qualify for a subsidy.

The government is still telling Americans how easy it is to purchase insurance on the exchange, so simple that anyone can wander on to the site and buy the perfect policy. Experience is, of course, very different.

I have spent hours upon hours on the government’s website. And yes, it is better now than it was last year. It still crashed this week while I was trying to help a client adjust his subsidy, but the site was only down for a couple of hours, not days. I have experienced the glitches, crashes, and unanticipated problems. I’ve had the 2 and 3 hour phone conversations with the call center. And I have had to seek help from Senator Sherrod Brown’s office and other government employees to help my clients get the access to insurance that they were promised. I am not alone. Many of my peers have encountered the same issues and more.

But our clients don’t experience the avoidable problems.

Major preventable issues:

• Choosing the wrong metal tier
• Choosing a policy that doesn’t include your doctor or hospital
• Choosing a policy that requires referrals to see a specialist

Most people understand how the Tax Credit Subsidy helps individuals and families pay for insurance. The target is an income of approximately 133% to 400% of the federal poverty level. But there is a second subsidy, the Cost-Sharing Assistance Benefit. If you are subsidy eligible and have an income of 250% of the federal poverty level or less (around $29,000) for a single), you are also eligible for a reduction in your deductibles, copayments, and maximum out of pocket. To get this additional benefit, this potential savings of thousands of dollars, you must purchase a silver level policy.

It is estimated that as many as 2 million individuals, 25% of those eligible, are failing to get these benefits. Link to Kaiser Health News, an invaluable resource.

I’ve talked with many people who were shocked to learn that the policy that they picked out on the exchange didn’t cover them at the Cleveland Clinic. Worse, some have called to complain that the new, cheap policy they chose doesn’t include the Cleveland Clinic or University Hospital in their network. Understanding the networks and choosing a policy that you can use are the first steps towards customer satisfaction. Bad fit is not an insurable event. Pick the wrong policy and you may be stuck for the whole year.

This blog has long been critical of PPO policies that require individuals to get a referral from their primary care doctors to visit a specialist. The process is cumbersome and inefficient. The primary care doctor may or may not be compensated for the additional paperwork. The policy descriptions on the exchange do not clearly note this requirement on some of the policies. Only someone familiar with the insurance products can help you avoid this pitfall.

Agents around the country will take their annual exchange training next month. We will spend hours learning this year’s policies and how to make the government’s website work. You don’t need to call me. There are lots of qualified agents, marketplace certified, throughout the country. A good starting point is the National Association of Health Underwriters. There is also a local chapter in Northeast Ohio.

Or you can go your own way.

DAVE

Vase from Zeber-Martell Gallery and Clay Studio

Some teachers counted pages. Some counted words. If you were assigned five pages, you had to produce at least five pages. A little extra couldn’t hurt. When my teachers asked for 500 words, I tried to deliver between 550 and 600. That’s not to say that we didn’t all use certain well-worn tricks and gimmicks. These papers never contained a single contraction. And we all knew how to stretch out a sentence and  how to end a paragraph.

Who knew these skills would be needed as an adult, and not just by any adult, but by a presidential candidate?

Governor Scott Walker (R-WI) unveiled his plan to repeal and replace The Patient Protection and Affordable Care Act (Obamacare) this week. I confess that I had no interest in reading this latest entry in the R & R game. After the disappointing and incredibly cynical bill put forth by Senators Richard Burr (R-NC) and Orrin Hatch (R-UT) – The Patient Choice, Affordability, Responsibility, and Empowerment Act – I decided to skip all light fiction reading for the balance of 2015.

Still, the Walker plan had a certain appeal. His campaign is sinking and the Republican base hates anything attached to the current president, especially Obamacare. And unlike the Congressional attempts, a sitting governor might actually create a thoughtful document, a plan that could be implemented in his/her state.

The Wall Street Journal reviewed the Walker plan before I had a chance to read it for myself. I was surprised that the Journal didn’t give it the usual “best thing since sliced bread” 5 star rating these plans tend to receive. No, it was panned. Now I had to read Scott Walker’s contribution to the healthcare debate.

Please click here to access Governor Walker’s plan.

The Walker plan is a fifteen page term paper circa 10^th grade. The page and a half preamble is hidden behind FOUR cover pages. The meat, the depth and breadth of how we manage 20% of our economy, is contained on the 6 ½ pages that follow the one page outline. Then there is a conclusion page and another cover page. Yep, Scott made it. 15 pages. Solid C material.

There aren’t a lot of specifics in the Walker plan. But the details he managed to include are mostly a rehash of some of the previous Republican plans. In an effort to differentiate himself from Obamacare and reality, Walker ties tax credits for the purchase of individual (non-employer sponsored) health insurance policies to age with no mention of income or regional differences. This change alone would price many people out of the market while providing a small bonus for those of us who have enjoyed a bit of financial success.

Yes, the Walker plan gives everyone purchasing a private policy a tax credit. If you are between the ages of 50 – 64, that credit would be $3,000. Governor Walker stresses the lack of infrastructure needed to implement his tax credit. That is because you would pay for your insurance this year and get the credit NEXT year when you file your income tax. What would that look like in the real world?

Test Case – Male, age 60, non-smoker, Cuyahoga County. Medical Mutual of Ohio Silver $3,000 HSA Premium – $661.00 per month or $7,932 over a twelve month period

Walker Plan

If your income was:                                     You would receive this tax credit:

$60,000                                                                   $3,000 Next year

$35,000                                                                   $3,000 Next year

$30,000                                                                   $3,000 Next year

$25,000                                                                   $3,000 Next year

Obamacare

$60,000                                                             $0.00

$35,000                                                             $245 per month now to help pay the premium

$30,000                                                             $316 per month now to help pay the premium

$25,000                                                             $381 per month now to help pay the premium

The sixty year old earning $25,000 while working in a store or small factory gets real help under Obamacare. His premium is reduced to under $300 per month and he qualifies for a lower deductible and out of pocket.

There is more (or less) to the Walker plan. There are the usual homages to crossing state lines, less regulations, and litigation reform. Medicaid reform and high-risk pools reappear under the Walker plan, too. And, of course, the most important cure for what ails us would be to incorporate more state by state control and regulation.

We could continue this, but we are in danger of breaking two important rules. The review should never be longer than the original piece. And, we really shouldn’t put in more time and effort than the author, candidate Walker, bothered to give.

What was it? What were you supposed to get done last week? Wash the car? School shopping with the kids? What about FILE YOUR TAXES?

4.5 million households received a Tax Credit Subsidy to help to pay for their 2014 health insurance. Close to 1.8 million of them, about 40%, have yet to file a complete income tax return. You must file a complete tax return, including form 8962, to qualify for next year’s subsidy.

No Tax Return – No Subsidy – No Insurance

The Tax Credit Subsidy is what allows many families to be able to afford health insurance. These subsidies are significant. The national average is $272 a month, over $3,000 a year. I’ve seen families qualify for twice that amount. It is hard to believe that anyone would jeopardize this lifeline intentionally.

The IRS has begun to contact these households. HealthCare.gov’s national frustration number, 1.800.318.2596, reports an uptick in tax related inquiries. And the administration is focused on the 60% who have complied. But no one really knows what is going to happen when the subsidy spigot is shut off for those who failed to file.

Consider this a gentle reminder. If you are a member of one of the 1.8 million households that received a subsidy but have yet to file a complete tax return, NOW is the time to get this done.

At some point you have to trust someone. Or not.

You have just received devastating news from your physician. You have a serious medical condition.

Scenario #1 – Your doctor suggests an aggressive course of treatment. Extensive and expensive. It might work. It might only give you a few extra months. But death is a certainty if you do nothing.

Scenario #2 – Your doctor advises you that all of the known treatments are painful, debilitating, and expensive. The likelihood of full-recovery is minimal, at best. He suggests palliative care and Hospice.

Do you view the doctor in the first scenario as a committed caregiver dedicated to doing everything to save your life or a shill for the medical industry prepared to profit from your illness and fear of dying? Do you view the doctor in the second scenario as a compassionate physician prepared to preserve the quality of your life or do you perceive a system that is prepared to sacrifice your well-being in an effort to save money?

Trust. Do you trust your doctor, your hospital, the insurance companies, or even the government? If you don’t, if you are positive that everyone involved is interested, first and foremost, in their own bottom line, than this discussion is over. There is nothing I can say that will change your mind or make an end-of-life discussion meaningful.

The balance of this blog is only meant for those with a healthy skepticism of our system and the players involved.

Medicine is an honorable profession populated by both the best and worst society has to offer. There are dedicated caregivers, committed claims staff, enlightened administrators, and elected officials prepared to do whatever it takes to make America safer and healthier. And there are people throughout the system who view the patient as either a profit opportunity or an unnecessary drain on our money.

There is no easy way to tell the difference, to know for sure that you are working with the right team. First you have to accept that there is a right team and that the system can work, that there are people up and down the chain who are willing to work on the patient’s behalf.

The Centers for Medicare and Medicaid Services (CMS) is again looking at physician reimbursements for advance care planning with their patients. Will doctors be paid for the time it takes to review all of the options open to their patients when they need this information the most, at the time of diagnosis and the beginning of treatment?

You may remember that this was a part of the Patient Protection and Affordable Care Act (PPACA). Those who choose to trust no one had their doubts. Some politicians called this “Death Panels”. This line of thinking works if you assume the worst of everyone involved.

But there is a counterbalancing argument. There have long been doctors and nurses who have questioned our end-of-life care. There are serious questions about whether average Americans endure more extensive treatments than similarly situated members of the medical profession.   When is enough enough?

This blog, from its first post in 2009, has promoted adult conversations about healthcare and how we pay for it.

So it boils down to information. And trust. Mostly trust.

Most of my clients are the owners of small businesses, really small.  Lots of my guys have fewer than ten employees.  When we talk about employee benefits we are discussing their money.  Every premium increase is a direct hit on their bottom line.  Some of my business owners are constantly trying to find new benefits they can provide to their employees and to their own families.  In the small group environment, the boss has the same coverages, good or bad, as the rest of the employees.

Or not.  For every business owner who plays by the rules and treats the employees fairly, there is at least one owner spending all of his/her time looking for corners to cut.  Employee benefits may be the corner they love to cut the most.

There were very few rules in the group health insurance business up until recently.

• Employees had to work full-time (25+ hours per week)
• The employer could not discriminate.
• The employer had to pay a substantial portion of the employee’s premium.

Ohio regulation stipulated substantial, but did not define it.  Medical Mutual of Ohio interpreted that as 25%.  The other major insurers defined this as 50%.

What you couldn’t do was pick and choose who got insurance or how much you, the employer, felt like paying per employee.  Couldn’t, but many did.  And other employers reimbursed their employees for individually purchased policies or other health costs.

Those days are over.

The Patient Protection and Affordable Care Act (PPACA) clamps down on these practices.  Enforcement is entrusted to the IRS who takes a dim view of these activities.  Businesses with fewer than 50 employees are not required to offer group health policies, but if they do, they must be compliant.  Employee reimbursement plans and other (not)groups are all lumped into the group category and deemed deficient.  And the penalties are huge.

Such an arrangement fails to satisfy the market reforms and may be subject to a $100/day excise tax per applicable employee.

That’s a penalty of $36,500 per employee.

Is that excessive?  Is that fair?  Yes and Yes.

We always knew the right ways to do this.  The employee should either have access to a real group policy or he/she should be responsible for purchasing an individual policy.  Not every business can afford to provide group health insurance coverage.  The employer may choose to give employees a raise with the hope, but not requirement, that the employee will use the extra money to purchase a policy.  There can be no strings attached to the raise.  The money is fully taxable to the employee and deductible to the business.

This is particularly important for those employees who might qualify for a Tax Credit Subsidy.  Employees are generally not eligible for a subsidy if their employer offers a group health policy.  Separating the real from the bogus may allow families to be properly insured.  The small increase in annual income from a legitimate raise is unlikely to eliminate a subsidy.

If we agree that it is better to have all Americans insured, if universal access to health care is our goal, then we should welcome this new attention to the enforcement of the rules.