The Center for Public Integrity

As I wrote last week, Maine and California are taking radically different approaches to implementing health care reforms within their boundaries. While the GOP-controlled government in Augusta has passed legislation that gives health insurers far more control of the health care system than they’ve ever had, lawmakers in Sacramento are taking California in the opposite direction. They’re moving rapidly to implement the federal Affordable Care Act, and if Insurance Commissioner Dave Jones and many of his former colleagues in the legislature have their way, California will be among the first states to implement a single-payer system in the years ahead. I spoke recently with Jones about the benefits and shortcomings of the federal reform law and why, even as commissioner of insurance, he continues to be an ardent single-payer advocate.

iWatch News: After nine months in office, what’s your overall assessment of the health insurance marketplace in California?

The lobbyists for U.S. health insurers surely have to be feeling a little uneasy knowing that thousands of Occupy Wall Street demonstrators who have been marching and protesting in Washington as well as New York and other cities might target them in the days ahead. After all, the headquarters of the insurers’ biggest lobbying and PR group, America’s Health Insurance Plans (AHIP), at 601 Pennsylvania Avenue, N.W., is just blocks away from Freedom Plaza, where the demonstrators have set up camp, and problems with health insurers appear to be near the top of the list of protesters’ concerns.

Health Care for America Now, an umbrella advocacy group that played a key role in the health care reform debate, last week analyzed the 546 comments that had been posted by then on “We are the 99 percent” Tumblr site. It found that 262 of the comments mention such problems as getting denials for doctor-ordered care from their insurance companies and having to forego treatment because of hefty out-of-pocket costs.

In my book, Deadly Spin, I wrote about how the “Wall Street takeover” of the American health care system has created many of the problems mentioned in the Tumblr site. I also described how AHIP offices have often been command central for developing and implementing coordinated efforts to derail health care reform efforts in the past and how the organization helped shape major provisions of the Affordable Care Act, which Congress passed last year.

Deb Richter knows from years of experience that you can’t take  “no” as a final answer from your health insurer. You’ve got to fight back.

As a doctor, Richter has gone to bat for many patients after they received denial notices from their insurance companies for care she knew they needed. I wrote about her advocacy for both patients and for a single payer system in Vermont last May.

Now Richter has a new patient she has to stick up for: herself. She recently learned she has cancer, and is discovering that, like many other Americans with life-threatening illnesses, she has to battle her insurer as well as her disease. And she is learning that even doctors have no immunity from the practices insurance companies engage in every day to avoid paying claims.

Last week I wrote about the importance of being a squeaky wheel when your insurer has decided it doesn’t want to pay for expensive treatment, even if your doctor believes your life might depend on it. I noted that most insurance firms have special departments to deal exclusively with what they refer to as “high profile” cases. Squeak loud and long, if necessary. You’re more likely to get the grease. Richter has every intention of being designated “high profile.”

Dear Wendell:

I received a letter from my insurance company stating that they are investigating whether my breast cancer is a pre-existing condition. Mind you, my mammogram one year ago was completely normal. Even when they went back and looked at it again this year and compared it to the positive one I just got, they stated there was no evidence of malignant changes on last year’s mammogram.

The Kaiser Family Foundation just released the findings of its annual survey of businesses to determine how much the cost of employer-sponsored health coverage has gone up. There were some unexpected findings.

One was that the average cost of annual premiums for family coverage is now more than $15,000. The 9 percent increase in the cost of health insurance over last year caught many people by surprise, because it represented a bigger hike in premiums than in recent years.

What seems clear is that insurers decided last year to charge their customers considerably more than necessary this year to be able to meet Wall Street’s profit expectations; insurance companies are also concerned that such increases will be more difficult once health care reform is fully implemented in 2014.

Here’s another surprise. Kaiser found that 50 percent of small employers are aware that they are now eligible for a tax credit from the federal government — thanks to the Affordable Care Act — if they provide subsidized coverage to their employees. I can hardly believe the awareness of the tax credit is that high.

As I have traveled across the country in recent weeks, speaking to a wide range of audiences, one thing has become abundantly clear: the provisions of the Affordable Care Act already in effect are anything but abundantly clear to people.

That’s because opponents of health care reform have won the public relations battle in defining the Affordable Care Act.

While the most recent Kaiser survey did not seek the views of the general population nor ask employers what they think or know about the Affordable Care Act, other polls show that advocates of the new law have been losing ground in the battle for public support.

If you think Rep. Paul Ryan’s plan to privatize Medicare is dead, think again. After Ryan unveiled his plan earlier this year, there was such widespread criticism that it briefly became a political liability for the Republicans.

The GOP-controlled House of Representatives approved the plan, which would replace the existing Medicare program with vouchers that beneficiaries could use to buy coverage from private insurance. But Ryan’s blueprint never made it out of the Senate.  It’s not hard to figure out why; the vouchers would have required most Medicare recipients—many of them on fixed incomes— would be paying more out of their own pockets for coverage than in the existing program.

I wrote at the time that the Ryan plan had the strong support of private health insurers, who would like nothing more than to have the federal government hand the Medicare program over to them.  The program would represent a vast new revenue stream guaranteeing profits forever.

Last week, the insurance industry and its allies began what I predict will be a massive campaign to sell the public and policymakers on the idea of moving forward with the Ryan plan—albeit with a few tweaks to make it seem more consumer-friendly.

An outfit called the Healthcare Leadership Council (HLC) issued a press release with the headline: “Health Industry Leaders Recommend Over $410 Billion in Healthcare Savings to Congressional ‘Super Committee.’ ”

At the core the HLC’s scheme is what might be called Ryan-lite, but don’t be fooled: the plan would—to use a favorite industry term—take us down the “slippery slope” toward a complete corporate takeover of the Medicare program.  (Insurers and their allies for years have warned Americans that enacting sweeping health care reforms they don’t like would lead us down the slippery slope toward socialism.)

Earlier this month I wrote that the Center for Public Integrity would launch “Ask Wendell” to help people who are at wits end trying to resolve a problem with their health insurer or who are trying to find decent affordable coverage but don’t know where to find it.

Your emails and tweets starting flowing in immediately. As I suspected, there will be no shortage of problems to tackle in the weeks and months ahead. We in the United States have one of the most complicated, confounding and unfair health care systems on the planet. But I hope to be of at least a little help to the people who write. So here goes.

Dear Wendell,

Our COBRA will run out next June and I've started to look for something cheaper. My 24-year-old daughter and I both have some made-up preexisting conditions, according to a few insurance companies that we've applied to, even though my doctor says that mine is not even a medical problem.

This has prevented us from getting individual plans. My husband and I are self-employed and my daughter's employer doesn't provide insurance. I don't really want to go without insurance for six months in order to get on Pennsylvania’s high-risk plan so I have been looking into an indemnity plan. I know it's not major medical, but (the company has) a plan called "Hospital Confinement and Surgical Fixed Indemnity Plan". The premium is lower but I'm not entirely sold on what I was told about it. Is this an OK avenue to pursue?

Audrey

Dear Audrey,

House Republicans, unable to repeal President Obama’s health care reform law outright, have decided to go after it piece by piece. If they are successful, what’s likely to remain is the kind of reform the insurance industry dreamed of but never really thought could be the law of the land.

Although the Republican-controlled House passed legislation to repeal the Affordable Care Act several months ago, the Senate, controlled by Democrats, rejected it. Bills are now being considered in the House that would strip some of the most important consumer protections from the new law. If the bills’ sponsors are successful, health insurers would be free to spend as little of our premium dollars on our health care as they want, and they would be able to continue setting lifetime limits on policies and cancel our coverage at the time we need it most—when we get sick. Other important benefits to consumers would also disappear.

Because of my nearly 20 years of experience as an executive of two large insurance firms, I was asked to provide my perspective on the legislation at a hearing today of the House Energy and Commerce Subcommittee on Health.

One of the bills would eliminate a provision of the reform law that requires insurers to spend at least 80 percent of what we pay in premiums on actual medical care. The insurance industry tried without success to keep that provision out of the final bill, so they are solidly behind the effort to do away with it.

As I am explaining to the lawmakers, there is a single-minded focus among the big for-profit insurers on being able to show Wall Street and investors two things every three months: that the companies made more money during the most recent three months than during the same period a year earlier, and that the portion of each policyholder’s premium devoted to covering medical expenses was less than it was the previous year.