Health care ebook


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This e-book looks at why our health care delivery system is not working. It was written to give you background information and links to other sites, so you can become a better informed health care consumer. Also to give you information on how to take control of your healthcare.

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Health care ebook

  1. 1. Health CareDelivery Systemin America has Failed By Andy Edley JE Health Care Solutions http://jehealthcaresolutions.com Independent Rep. For: Renco Direct contact 865-357-3379
  2. 2. ALL RIGHTS RESERVEDIf you find this report is helpful to you and it could help others, pleasefeel free to pass it on to your friends and family.DISCLAIMER AND/OR LEGAL NOTICESThe information presented herein represents the views of the authoras of the date of publication. Because of the rate with whichconditions change, the author reserves the right to alter and updatehis opinions based on the new conditions. This report is forinformational purposes only and the author does not accept anyresponsibility for any liability resulting from the use of thisinformation. While every attempt has been made to verify theinformation provided here, the author cannot assume anyresponsibility for errors, inaccuracies or omissions. Any slights ofpeople or organizations are unintentional.Copyright © Andy Edley (September 2011)The purpose of this e-book is to give you information and resourcesyou can use to decide who is going to Control your Healthcare; you, orsomeone else? The Insurance Companies or the Government? I hopeit will also help you understand and learn ways to control your cost.
  3. 3. TABLE OF CONTENTSPreface: How We Got HerePage 8) Chapter One: How Cost Of Health Insurance Has RisenPage 10) Chapter Two: Do We Need Our Health Care Delivered?Page 12) Chapter Three: Who Controls Your Health Care?Page 14) Chapter Four: Who Takes Your Health Care Dollar And Why?Page 18 ) Chapter Five: Affordable Healthcare Act (Obamacare) How It Effects Your HealthcarePage 23 )Chapter Six: Get Out While You Still Can “A Solution”
  4. 4. How We Got HereI want to start by giving you a little history lesson on How the Health Care DeliverySystem started. I will be using BCBS as the example since they were the first one andyou can find this information at: would like you to pay close attention to a few of the time line dates. The first one is1935, the next one is 1950, then 959, 965, 973, 997, and of course. 2010. the year ofObamacare. You will notice as the years go by, the Insurance industry, Labor Unions,and Government got closer and closer. This is why the insurance companies likeObamacare; it forces everyone into a third -party payer system, which is what a HealthCare Delivery System is all about. Remember, by controlling your health care, theycontrol you.1929: The prototype prepaid hospital plan, upon which Blue Cross Plans were laterbased, is created at Baylor University in Dallas, Texas, established by Justin FordKimball. In just 10 years, enrollment in Blue health Plans will grow from just more than1,300 covered lives to 3 million.On December 27, 1933, Americas first "Blue Cross Baby" was born in Durham, NorthCarolina. The entire cost of her delivery and her mothers 10-day hospital stay totaled$60. This birth was the first in America to be covered by a health insurance familycertificate that included maternity benefits.1935: The Social Security Act is passed, omitting health insurance. The National LaborRelations Act, requiring management to bargain with labor over "wages and conditions"is enacted and will become a catalyst for employer-based health benefits.1944 : Unemployment drops to 1.2 percent. Under normal conditions, employers wouldhave lured workers from competitors with higher wages. However, during the World WarII years, price and wage controls were strictly enforced. To compete for workers,employers began to offer health insurance benefits, giving rise to the employer-basedsystem -- still largely in place today.1949: The Inter-Plan Service Benefit Bank is created as a coordinating mechanism toprovide coverage for subscribers who were hospitalized away from home. 1950: The groundbreaking "U.S. Steel Agreement" went into effect between UnitedStates Steel Corporation, the Carnegie Pension Fund, and Blue Cross of WesternPennsylvania. The role played by the Pittsburgh-based Plan -- the "control Plan" thatcoordinated administration of benefits by local "participating Plans" -- becomes thelinchpin of the Blue Systems ability to serve large national accounts.NOTE: This is where the insurance companies got involved with the unions and thirdparty payer took off.
  5. 5. 1955: The spread of health insurance coverage-- from less than 10 percent of thepopulation having coverage in 1940 grows to nearly 70 percent in 1955.1959: Congress enacted the Federal Employees Health Benefits Act and the first FEPopen enrollment period was held a year later. Today, FEP covers more than 4.8 millionfederal employees, retirees, and their families.NOTE: This is where insurance got involved with Politicians. This was a bad ideabecause politics and health care should never be mixed.1960: Associated Medical Care Plans is renamed Association of Blue Shield Plans.1965: The Medicare and Medicaid programs are created. Launching a massive programlike Medicare would have been prohibitive without the established Blue Cross and BlueShield infrastructure. In the five years following Medicares inception, Blue Crossprocessed 63.4 million claims, totaling approximately $19.2 billion. In 2001, the BlueSystem continued to process the overwhelming majority of Medicare.NOTE: Just a personal note here, my mother, who was an RN at the time, said that thiswould end up destroying health care in this country. She said that having thegovernment involved in health care would never work. I think she was right.1973: The Health Maintenance Organization Act provided federal grant and loan moneyto help HMOs get off the ground and contained broad language about benefits that hadto be provided.NOTE: More government involvement using tax money to support what should havebeen a private business function.1996: Blue Cross and Blue Shield Plans, PPO, POS and HMO, enrollment reaches 37.5million, surpassing the 30.4 million members in traditional coverage.1997: The Balanced Budget Act is enacted, which added the Medicare+ Choiceprogram allowing beneficiaries to choose additional types of health plans.NOTE: This is more government involvement.2001: Blue System processes the majority of Medicare claims at a total of $163 billion.2003: Blue Cross and Blue Shield system-wide enrollment reaches all-time high. Morethan 88 million Americans - nearly one-in-three – have BCBS coverage.2005: Blue Cross and Blue Shield system-wide enrollment reaches 93 millionAmericans. Nearly one-in-three have BCBS coverage.2006: The BlueCard® Program processed more than 194 million claim transactions, upfrom 182 million in 2005.
  6. 6. 2009: Blue Cross and Blue Shield system-wide enrollment reaches more than 100million Americans.NOTE: I hope this has given you a little background information on how the insurancecompanies developed their third-party payer system. This is also why they backedObamacare; because it meant everyone would have to buy health care insurance. It isstrange that these same insurance companies got Obamacare waivers from somethingthey thought was such a great thing for the rest of us. CPT CODESNow I want to give you some history on the CPT Codes. These are the 5 digit numbersyou see on the form the doctor fills out when you go for a visit. You also see them onthe paperwork you get from your insurance company when you have a claim. The AMAowns the Copyright to these codes.CPT was first developed and published by the AMA in 1966. The purpose of the system was to standardize the categorization of the types ofservices provided by physicians.In 1983, HCFA, now CMS, mandated CPT for Medicare billing**CPT (Current Procedural Terminology) codes are numbers assigned to every task andservice a medical practitioner may provide to a patient, including medical, surgical, anddiagnostic services. They are then used by insurers to determine the amount ofreimbursement that a practitioner will receive by an insurer. Since everyone uses thesame codes to mean the same thing, they ensure uniformity. CPT codes are developed, maintained, and copyrighted by the AMA (American MedicalAssociation.) As the practice of health care changes, new codes are developed for newservices, current codes may be revised, and old, unused codes are discarded.Thousands of codes are in use and they are updated annually. Development andmaintenance of these codes is overseen by editorial boards at the AMA and thepublications of all the software, books, and manuals needed by those who use them,brings millions in income (*see note below) to the AMA each year.Examples of CPT Codes:  99214 may be used for a physical  90658 indicates a flu shot  90716 may be used for chicken pox vaccine (varicella)  12002 may be used to stitch up a one-inch cut on a patients armIf you use Medicare, youll see CPT codes, but used a bit differently. Medicare usesHCPCS codes (Healthcare Common Procedure Coding System.)
  7. 7. Matching CPT Codes to the Services They RepresentAs patients, our interest in these codes is usually related to our doctors and insurancebillings. Until recently, it was difficult to find out what certain CPT codes meant withoutcontacting your insurance company or doctors office.You wont find a freely-available, comprehensive list of CPT codes because the AMAcontrols their publication. Groups that have tried to make them available for free to thepublic have been cited for violations, fined by the AMA, and have been forced to removethem from the Internet. Since the AMA developed and copyrights the system, it has aright to make sure access to these lists is paid for. It licenses CPT code lists to groupswho wish to publish the codes to make them available to others. Those groups thencharge a fee for access, too. We patients dont have the large sums of money needed to subscribe to websites orpurchase publications that list CPT codes. To make them more accessible to us, theAMA does provide on its website a means for looking up the individual CPT codes youmight find on your doctors bills or EOBs (Estimates of Benefits).Learn more about where to find CPT codes, what they look like, and find the links tolook them up for free.*(Note about the AMAs income from CPT codes: The amount the AMA makes fromCPT codes each year is in dispute.)** Information found at patient empowerment by: Trisha Torrey
  8. 8. CHAPTER 1How Cost Of Health Insurance Has RisenThis information is from the Kaiser Report (EMPLOYER HEALTH BENEFITS 2010REPORT) You can get the full report HERE.The key findings from the 2010 survey, conducted from January through May 2010,include increases in the average single and family premium, as well as in the amountworkers pay for coverage. About a quarter (27%) of covered workers have a deductibleof at least $1,000 for single coverage and a greater proportion of workers are enrolled inhigh-deductible health plans with a savings option (HDHP/SO) than in 2009. Firmsresponded that they increased cost-sharing, or reduced the scope of coverage, orincreased the amount workers pay for insurance as a result of the economic downturn.The 2010 survey continues to track the percentage of firms offering wellness benefits orhealth risk assessments and also included questions on health plan quality indicatorsand benefit changes made as a result of the Mental Health Parity and Addiction EquityAct.The average annual premiums for employer-sponsored health insurance in 2010 are$5,049 for single coverage and $13,770 for family coverage. Compared to 2009,premiums for single coverage are 5% higher ($4,824) and premiums for family coverageare 3% higher ($13,375). Since 2000, average premiums for family coverage haveincreased 114%. Average premiums for family coverage are lower for workers in smallfirms (3–199 workers) than for workers in large firms (200 or more workers), ($13,250vs. $14,038). Average premiums for high-deductible health plans with a savings option(HDHP/SOs) are lower than the overall average for all plan types for both single andfamily coverage. For PPOs, the most common plan type, the average family premiumtopped $14,000 annually in 2010.As a result of factors such as benefit differences and geographical cost differences,there is significant variation around the average annual premium. Twenty percent ofcovered workers are in plans with an annual total premium for family coverage of atleast $16,524 (120% of the average premium), while 19% of covered workers are inplans where the family premium is less than $11,016 (80% of the average premium).In 2010, covered workers contributed a greater share of the total premium, a notablechange from the steady share workers have paid on average over the last decade.Covered workers on average contribute 19% of the total premium for single coverage(up from 17% in 2009) and 30% for family coverage (up from 27% in 2009). As with total
  9. 9. premiums, the premium shares contributed by workers vary considerably around theseaverages. For single coverage, 28% of workers pay more than 25% of the total premiumwhile 16% make no contribution.Fifty-one percent of workers with family coverage pay more than 25% of the totalpremium; only 5% make no contribution. Looking at dollar amounts, the average annualworker contributions are $899 for single coverage and $3,997 for family coverage, upfrom $779 and $3,515 respectively in 2009. Workers in small firms (3–199 workers)contribute about the same amount for single coverage as workers in large firms (200 ormore workers), ($865 vs. $917), but they contribute significantly more for familycoverage, ($4,665 vs. $3,652).NOTE: There was another 10% increase in cost in January 2011. There is no sign thatthese increased costs are going to slow down anytime soon. Individual plans havefollowed suit in cost increases.
  10. 10. CHAPTER 2 Do We Need Our Care Delivered? Or Do We What Quality Health Care?Before we get into this chapter I would like you to take a little quiz and test yourknowledge of the healthcare delivery system we now have. Click here to take thequiz.Now that you have taken the quiz, how did you do. If you did not do well then you are inthe majority because most people have know idea how the system works. What I amtrying to do is help you forget the health insurance company, AMA, drug company,media and government propaganda we have been fed for the last 50 or so years andbegin to uncover the truth. This not your fault because we have all been sold a bill ofgoods and now the system is broke, and they are trying to tell us more healthcaredelivery will fix the problem.So What is health care delivery? The best way to describe health care delivery ishealth insurance companies gone rogue. Instead of being and doing what insurance issupposed to be and do, they have become the source for all health care. Instead ofproviding a safety net for large hospital expenses, they have picked our doctors, ourdrugs, our hospitals, our diseases and our eventual demise - all because of money.Dont get me wrong, I am a capitalist and an entrepreneur. I believe in making money,profit, doing well and most importantly doing good. The health insurance companieslong ago ceased doing good.The problem comes when its all about the money and not doing the right thing. Whenthrough coercion, deception and corruption an entity or a group of entities becomes soobsessed with making money that human life and the quality of life become a distantsecond or even a third or fourth priority.Instead of being there to pay for large bills, like any other kind of insurance, the healthinsurance companies have taken it upon themselves to run every portion of our healthcare from picking our doctors all the way to ending our lives once the cost of keeping usalive becomes too steep.And now we have the Government wanting to do the same thing with their panel of 15un-elected government worker bees deciding what treatment you can have and whattreatments are the least expensive, rather than which are best for you. They also wantto control what your doctor gets paid, and when to just knock you out with drugs it youstart needing to much care. This is what Obamacare does for you.
  11. 11. This is what healthcare delivery is, someone else making medical decisions for you,instead of you and your doctor. I for one want to make my own decisions with mydoctor and nobody else. HOW ABOUT YOU.
  12. 12. Chapter 3 Who Controls Your Health Care? Who Should Control Your Health Care?Where do I start, I seems everybody but you is in control of your healthcare.There are four groups controlling your health care and the cost. 1. Insurance companies 2. Drug Companies 3. AMA 4. GovernmentFor over 50 years the insurance companies have been working to control your healthcare by convincing us that you have to have health care insurance. They have donethis by working with unions, Governments (Local, State and Federal) and thrucommercials on radio and TV. By convincing us that a “third party payer system” welloffer the people the best health care possible at the lowest cost. Well we know nowthat this is not true. What has happen is we now have a health care delivery systemcontrolled by the insurance companies and others and no control by the patient or thedoctor. I am sure you have noticed how people from other countries come to the US formedical treatment at least those that can afford it, because they can get the besttreatment in the world here. The difference is they pay cash for their treatment. Sowhen some political figure says our health care is not good here in America they arelying to you, because we have the best medical care available in the world. What is notworking is the health care delivery system we have. Our health care should never becontrolled by anyone but ourselves and our doctor’s.Drug companies are also helping in controlling your health care. Have younoticed all the commercials on TV and ever where else about this or that newwonder drug. So people self diagnose themselves and go to their doctor andwant a prescription for this wonder drug that is going to cure what ever. Theproblem is they don’t cure the problem they treat the symptoms an cause newproblems. Half of these commercials are used to explain all the side effects theymay cause. Did you know for a new drug to get FDA approval it must be toxic tothe body?So when you go to the doctor for your new wonder drug guess who makesmoney? It is now you! The cycle starts all over again the doctor files aninsurance claim the drug store files a claim and the insurance company makes
  13. 13. more money off of you. Remember for every dollar you pay for health careinsurance you get 25 cents worth of service and the insurance companies anddrug companies and others get a part of the other 75 cents.Have you noticed no one talks about curing a problem? All we here is lets treatthe problem with this drug or that drug. Drug companies send billions of dollarspushing their drugs to doctors and the public. When you are at your doctorsoffice how many drug companies reps. Are there waiting for their turn to show thedoctors the latest and greatest drug out. This process starts while the doctorsare still in medical school and this is how they are taught, this is how the systemis suppose to work. There is no profit in curing someone only in treatment.After the billions that the American Tax payer has poured into this research groupor that research group you would think they could come up with a CURE forsomething. Don’t get me wrong we need to do research, but should we not wholesomeone responsible to produce something that is a CURE, not just anothertreatment that cost some outrages amount of money. Have you noticed doctorsalways say we can treat this with this drug or this drug but never say we can curethe problem. CURE is the dirty four letter word to the health care delivery system.The AMA controls your health because they control all the Medical schools andhow or doctors are trained. Our Doctors are taught from the beginning the way tobuild a practice is sign up with as many insurance companies as they can andsee as many patients as they can. This is why your doctor spends so little timewith their patients because to be able to keep their practice open they have to seeas many patients as they can do to how they get paid by the insurancecompanies. They are also have to deal with the Drug Company reps. On a regularbasic while the are still in medical school.Also remember the AMA owns the copyright to all the CPT codes that I talkedabout in the preface, so they make money every time you go to see your doctorare get a prescription filled, or go to the hospital.Now for the fourth group that has a hand in controlling our health care. TheGovernment. This all started back in 1959 when Congress enacted the FederalEmployees Health Benefits Act and the first FEP open enrollment period was helda year later. Today, FEP covers more than 4.8 million federal employees, retirees,and their families. It got worst in 1965 when The Medicare and Medicaidprograms were created. Launching a massive program like Medicare would havebeen prohibitive without the established Blue Cross and Blue Shieldinfrastructure. In the five years following Medicares inception, Blue Crossprocessed 63.4 million claims, totaling approximately $19.2 billion. In 2001, theBlue System continued to process the overwhelming majority of Medicare claims.2010 Now we have the healthcare reform law (Obamacare). This is the completetake over of the healthcare delivery system. Who is going to benefit from this the
  14. 14. most, the insurance companies, drug companies and the AMA. That is why theybacked Obamacare. But like the Congress they did not read the bill before it waspassed and now they are getting waivers so they dont have to deal with it. Alsothe unions are getting waivers and they backed this disaster as well. I guess theold saying be careful what you wish for is still true. The only real answer is to geteducated and take control of your own healthcare.This is what happens when you have third-party payer system like we have in thiscountry. It is also why a third-party system does not work well. To many peoplelook at it as a way to make money instead of delivery of the best health carecontrolled by the patient and their doctor.All of this information is out there you just have to take the time to find it. A goodplace to start is Care Liberty and I strongly urge you to get educated on what isreally going on with our health care system. Both for yourself and your family’shealth.
  15. 15. Chapter 4 Who Takes Your Health Care Dollar And Why?Did you know that for every dollar you pay for healthcare insurance on average you getabout 25 cents worth of actual patient care. Yes there are exceptions to this but this iswhat the average is. That means 75 cents is going to somebody else. So, whose elseas their hand out for their part of this 75 cents? Well to answer that question lets look atwhat happens to your healthcare dollar.The following data is extrapolated from Mutual of Omahas Annual report on Healthcare utilization & cost.ABC co. inc. insures 100 employees. The national Average for a single person is$5000 per year. Cost to the company is $500,000.00 for the 100 employees. Onaverage 90 employees will get about $450.00 annual benefit, 3 employees will getabout $5000.00 annual benefits and 7 employees will need be hospitalized.Average cost for a hospital stay is $30,000.00 of which the insurance co. will pay anaverage of $10,000.00 after they take there provider network discount. So companywide average benefit paid out is $125,000.00 annually. This means only $.25 of eachdollar paid out in premiums goes to your actual healthcare.Health Insurance premiums have increased over 100% since 2004, yet Doctorsreimbursements have decreased 40%, hospitals reimbursement have kept pace withinflation. So if the doctors and hospitals arent getting it where does it go.Most people want to blame the insurance companies, and then the politicians start apush for more laws. The real truth is there are to many laws already. Insurancecompanies are so regulated already there is no way they can operate in a free market.So what happens we get Obamacare which means now the government and insurancecompanies now will control your health care. They now decide which doctors you cansee, what hospitals you can use, what treatment you can have and which drugs you canhave. Add to that the 15 person UN-elected panel and you have a health care systemthat puts cost before patient care. They now are telling the insurance companies whatthey have to cover at no cost to the patient. What do you think is going to happen tohealthcare insurance rates? Someone is going to have to pay for all of these newprograms.The fact is quality health care is not free. Doctors deserve to be paidwhat they are worth and need to be free to treat their patients with out interference fromoutside. This is what they spent 8 or more years of their lives in school for. Hospitalsneed to be paid fairly as well, are they will have to close their doors.
  16. 16. So who is taking your healthcare dollars.When you or your employer pay the insurance premium to the insurance company yourdollars are no longer yours but belongs to the insurance company. So how is it spent?So lets see what happens to your insurance dollar after you or your employer pays theinsurance premium. 1. The Insurance Company now as control of your insurance dollar. 2. Risk Group: ( Employer Group) These are the people in your group that are sick, because it is a guarantee issue group policy. 3. Government: This all the laws, regulations, political contributions. Taxes, fees etc. 4. Labor: Because of labor unions in hospitals, cost or driven up. Labor union demands for high cost insurance plans drive up cost. Things like low co-pay, low cost prescriptions, etc. 5. Government Programs: Medicare, Medicaid reimbursements from your policy have to go to help cover the under payment from these programs. 6. Big Disease: These are non-profit and puts mandates on every ones policies. Things like cancer, heart disease, COPD, etc. Your premiums reflect these cost because all of these have to be covered for everyone. 7. Drug Companies: The drug companies have put themselves between you and your healthcare dollar by marketing directly to you with adds for the next miracle drug so you will self diagnose and run to your doctor and ask for their drug by name. 8. Attorneys: These are the tort attorneys that are waiting for your doctor to make a mistake. Malpractice insurance is built into your doctors cost of doing business, but this forces them to do Unnecessary test just to cover themselves against the attorneys. 9. Billings and Collections: This would not be need if it werent for insurance companies. Billing is needed to handle the paper work involved with filing insurance companies. Collections are needed because remember the insurance company can deny your claim and they have to collect from you.All of these entries are between you and your doctor thus your healthcare.
  17. 17. Now lets look at hospitalization and what else is between you and your healthcaredollar. Remember this all of the above as well. 1. Claims: A lot of claims are denied or delayed. The claims job is to save the insurance companies money by denial or delaying claims. 2. Case Manager: The case managers job is to approve the lease expensive treatment and the doctor with the lowest bid.So where is all the savings going it is not going to you or me remember or premiumshave increased 100% since 2004 and the doctors are being paid 40% less and thehospitals are barely keeping up with the rate of inflation. The truth is this money isgoing everywhere but where it should, OUR HEALTHCARE. Now we get AffordableHealthcare Act (Obamacare). This will allow the government to take control of thisof the complete health care delivery system. Chapter 5 will go in-depth on this. Thereis a solution that we will go in-depth about in chapter 6.
  18. 18. Chapter 5 Affordable Healthcare Act (Obamacare) How It Effects Your Healthcare and MedicareIn this Chapter we will look at how the Affordable Healthcare Act will effect yourhealthcare and Medicare both in cost and quality of care. I must admit that I am totallyagainst the government being involved in our health care in any way. All you have to dois look at the history of the government involvement in health care and you see totalfailure, both in keeping cost down and improving quality of care. Anytime you mixpolitics with healthcare you are going to end up with what we have now. It is badenough having insurance companies deciding what treatment they will pay for or not,now we are going to have a panel of 15 people appointed by the president makingthose decisions for you. I know the politicians say this will control cost but it is not theirjob or right to make medical decisions for you are your family. That needs be left to youand your doctor and know body else. What I will be giving you is a lot of referenceinformation from people a lot smarter then I am, this way you can reach your owndecisions about this law.For those interested in reading the Affordable Healthcare Act passed by congress, ClickHere to get a PDF copy. It is 906 pages long.How this law well effect healthcare delivery is just now starting to show up and so far itis not good. Cost have already risen from $12,680 in 2008 to $13,770 in 2010 for familycoverage according to the Kaiser Foundation 2010 Report.Phil Galewitz covers Medicaid, Medicare, long‐term care, hospitals and various statehealth issues. He has covered the health beat for nearly two decades. He is a boardmember of the Association of Health Care Journalists and Health News Florida, anonprofit news service. In 2004‐05, he was a Kaiser Media Fellow and wrote aboutcommunity solutions to the uninsured. Before coming to KHN, he was at The PalmBeach Post and was a national health industry writer for the Associated Press and ThePatriot‐ News in Harrisburg, Pa. He has a BA in health planning and administration anda masters in public administration with an emphasis in health policy. | Contact:PGalewitz@kff.orgI highly recommend you go to his site by clicking on his name below. He has a lot ofarticles on healthcare that I think are worth reading.Article by: By Phil Galewitz Nation’s Health Care Bill To Nearly Double By 2020
  19. 19. QUOTE:The federal health law, which will expand coverage to 30 million currently uninsuredAmericans, will have little effect on the nations rising health spending in the nextdecade, a government report said today.The report by the Medicare Office of the Actuary estimated that health spending willgrow by an average of 5.8 percent a year through 2020, compared to 5.7 percentwithout the health overhaul. With that growth, the nation is expected to spend $4.6trillion on health care in 2020, nearly double the $2.6 trillion spent last year.Article by: By Merrill Goozner, The Fiscal Times: Rising Health Care Curve Won’tBend, Even for ObamaQUOTE:A forthcoming report from the Congressional Budget Office shows that more thantwo dozen demonstrations projects launched by Medicare and Medicaid over thepast decade have failed to stop the upward march of health care costs, CBOdirector Doug Elmendorf said Tuesday. But health care policy experts say thefindings paint too gloomy a picture.The CBO pronouncement will heighten pressure on politicians from both politicalparties to come up with new health care cost savings beyond those contained inthe health care reform bill, whether as part of the current debt ceiling talks or inseparate legislation. Federal spending on Medicare and Medicaid totaled $739billion in 2010, making health care the single largest budget item in the federalbudget. Those costs are expected to nearly double in the next decade.The article below is another reason why Government and Healthcare shouldnever be mixed. Based on the Law insurance companies can raise their rates9.9% per year without having to justify the rate increase. What will the cost be toyou it this happens each year.Written By: Edmund F. HaislmaierPublished In: Health Care News > August 2011Publication date: 07/08/2011Publisher: The Heartland Institute
  20. 20. Defund Obamacare’s Insurance Rate ReviewsThe recently published U.S. Department of Health and Human Services regulations forimplementing Obamacare’s health insurance rate reviews, effective September 1, areanother instance of the arbitrary and politically manipulated regulations that inevitablyresult when Congress enacts vague, subjective, and aspirational legislation rather thanclear, objective, and specific statutes.Political Pressure on PremiumsThese rate-review provisions were an entirely political exercise from the start. Theywere only added to Obamacare in the fall of 2009—after the health-insurance industryhad the temerity to point out other provisions of the legislation would drive up premiums—in order to give HHS authority to review so-called “unreasonable” premium increases(but not the authority to block those increases, nor did it provide a definition of“unreasonable”). Blame for Obamacare’s inevitable cost increases could thereby bedeflected onto insurers.These provisions have negative practical implications. For example, the proposed rulesetting an arbitrary 10 percent price-increase threshold could cause insurers to targetrate increases to just below the limit. One well-documented effect of price controls isthat sellers respond to the imposition of price “ceilings” by turning them into price“floors.” The less competitive the market on which price controls are imposed, thesooner that phenomenon occurs.Guaranteed InflationUnder these regulations, any rate increase of 9.9 percent or less will not trigger aburdensome, publicized federal rate review, so why should an insurer limit a rateincrease to, say, 6 or 7 percent? Theoretically, competitive pricing pressure mightdiscourage such behavior. But these and other Obamacare insurance regulations willreduce competition by driving smaller carriers out of the market, and after 2014 theremaining insurers will be selling to customers who are required to buy their products.Thus, the perfectly rational response will be for the remaining insurers to have 9.9percent annual premium increases ad infinitude.Ignores Insurer SolvencyThese regulations are contrary to even the legitimate purpose of insurance-ratesupervision, which is to make sure carriers charge high enough premiums to cover their
  21. 21. claims costs. In a competitive insurance market, regulators don’t have to worry muchabout possible “price-gouging,” since competition checks such behavior. However,regulators do need to be concerned about insurers trying to attract more business byunder-pricing coverage while complacently underestimating their future losses—theactuarial equivalent of “rosy scenarios.”The danger is that if premium income isn’t sufficient to cover claims costs, an insurerrisks becoming insolvent. That harms everyone, including policyholders or taxpayerswho can be left liable for claims the insurer can’t pay.Thus any rate-regulation regime that focuses only on holding down rates while ignoringinsurer solvency is inherently dangerous. HHS admits this is a serious flaw in thestatute: “We acknowledge that inadequate rate increases can be problematic,” but itblithely dismisses those concerns, arguing the statute “does not identify adequacyamong the criteria to be considered when determining unreasonableness.”Case for DefundingFortunately, this bad idea is one of many in Obamacare that can be defunded. Includedin Obamacare’s $105 billion of advanced appropriations was $250 million for HHS todistribute in grants to state insurance regulators to implement stricter rate regulation.The purpose of those grants is to bribe state insurance departments into enforcingObamacare’s new federal price controls.Last summer, HHS distributed $46 million of that $250 million to 45 states and theDistrict of Columbia ($1 million to each) in the first round of rate-review grants. HHSsays it intends to award a second round of grants in the fall. Congressionalappropriators should intervene and rescind at least the remaining $204 millionearmarked for rate-review grants.The five states that did not apply for the first round of grants (Alaska, Georgia, Iowa,Minnesota, and Wyoming) should continue to refrain from doing so, and states thatreceived the initial funding should follow the lead of Oklahoma’s Insurance Departmentand return the money. Doing so is in the interests of state lawmakers, who should wantto preserve the independence and integrity of their state insurance departments in lightof the inherent conflicts that will arise between the new federal rate regulations andexisting state insurer-solvency laws.Edmund F. Haislmaier ( is a senior research fellow in theHeritage Foundation’s Center for Health Policy Studies. Article reprinted withpermission from more articles by Edmund F. HaislmaierThese are just a few articles about Obamacare and what they show is that a one sizefits all government answer will not work and that as long as the insurance companiesand politicians are involved with each other there are going to be major problems. What
  22. 22. we need is a free market program where patients drive our health care, both in cost andquality.Now I what to look at the State insurance exchanges that this Law set up. We dontknow yet exactly how they will work but I do have an example from one State that hasexchanges set up. A Client in Utah had to buy through their exchange. She is paying$500 per month for a policy that has a $5000 deductible per year and does not payanything until she has paid that $5000 on her health care. That means It is costing her$6000 a year plus the $5000 deductible or $11,000 before the insurance pays anything.If this is an example of the exchanges then we are all in for lot of out of pocket expensefor healthcare. The Insurance wants these exchanges because it will help them not tohave to pay commissions to the insurance agents that sell health care insurance. Soyou have another group that will be hurt by this Law.You may say I have employer-based healthcare insurance, Well I am now seeingreports that as many as 30% of business are saying they will drop their group plansbecause of the high cost. It will save them on their overhead to pay the fine rather thencontinue to pay the high cost of insurance. This will force more people into theexchanges which will put a larger burden on the government, other words more cost tothe taxpayer. If you work for a company that has less then 50 employees than they areexempt from this regulation, and dont have to offer health-insurance.The main point here is that we all need to become better informed when it comes to ourhealthcare. Another words we need to take responsibility for our own healthcare andquite relying on a third party to do this for us.
  23. 23. Chapter Six Get Out While You Still Can A SolutionIn Chapter 4 I showed what happens to your health insurance premium dollars, now Iwant to show you a better way to have complete control of your health care dollars, aswell as your health care.So what do we do to solve this problem? Find a program that lets you pay cash for your doctor visits at an affordable price. That is where Renco Direct comes in. With this program you become a member of Renco and this will allow you to pay the same PPO Allowable rate that the insurance companies have been paying for over 50 years. This works both for you and your Doctor. You pay the PPO allowable at the time of your visit and the Doctor does not have to file a insurance claim and wait for his money. This is a win win situation for both you and your doctor. Also medical decisions are based on your medical needs and not what an outside agency be it government or insurance company decides is best for you or your family. Because this program is a non insurance plan no one is turned down due to pre-existing conditions, and no one is going to deny or delay your treatment. Since you are not filing insurance claims your medical care is you and your doctors business and nobody else. The Renco Direct also concludes many more savings programs such as Prescription discounts, Vision, Dental, Consult a Doctor, Chiropractic Care, and more.The Renco Direct program works well if you have existing healthcare insurance policythat you like and want to keep if you could get your rate lower. By increasing yourdeductible to say $7500 or even $10,000 which will reduce your cost, and using Rencofor your regular office visits and having the health insurance policy to take care of themajor problems. Another option is to combine Renco with an accident or critical carepolicy which are much less expensive.For more information on how JE Health Care Solutions can help you with answerstailored to your family or business needs please contact us or call 865-357-3379.I hope the information I have given you in the e-book will help you in getting answersthat make sense in your health care decisions.Andy Edley