As the debate about putting a safety net national health plan rages on, and the focus is on the tennis match between the Obama Administration and the millions that the insurance industry is lavishing on the Congress to buy votes, er, persuade effectively, why can we not do something much simpler, and use the power of the government to really regulate the insurance companies?
Don't get me wrong: A safety net for the millions of uninsured is necessary. The problem is that once you have created it, it will not, in and of itself, mean that all of us who already have health plans, will be any better off than we were yesterday.
We live in a hodge-podge of insurance regulation from state to state, with no level playing field. A fact that plays to the advantage of the insurance companies, which use their influence peddling from state to state to garner whatever economic or competitive gains that they can, but which leaves the protection of health, life and property in a giant mess.
We have an SEC, an FDA, an ICC, but no IRC (Insurance Regulatory Commission). States issue rules that regulate insurers, but there is no Federal agency to do this.
Just as banks have both state and federal hoops to pass through in their daily operation, Insurance companies should be no less liable. There is a Federal mandate for insurance regulation, and President Obama should exercise it, in spite of the whining that the Republicans and the Blue Dog Dems on the leashes of big insurance and big pharma will undoubtedly engage in.
He talks about an "insurance clearing house" that will let us choose policies in some utopian dreamland. One company alone, a Blue Cross, can have dozens of them, each with their own unique and confusing requirements. Sure, you can probably get an Internet website to help compare and contrast, but starting with a regulatory landscape that will level and simplify the playing field would be a boon both to subscribers and physicians.
Doctors will not take insurance from carriers when there is too much paper pushing or the rules are so far afield that they are hard to either comply with or swallow.
Obama wants to get rid of the waste in medicine? His new IRC would be able to help regulate a sane and sensible public policy.
HealthCareShopper.com reports:
As the number one cause of hospital admissions, childbirth accounts for more than $79 billion in hospital charges alone. Pregnancy is the most expensive condition for both private insurers and Medicaid.
Among privately insured patients, uncomplicated cesareans run about $13,000. nearly twice as much as a comparable vaginal birth. Cesareans account for a disproportionate amount (45%) of delivery costs.
Back in the 1990s, Blue Cross of California switched from paying more for C-sections to paying more for vaginal deliveries. The number of C-sections plummeted more than 70%. Doctors were erring on the side of their pocket books, it would seem.
A standardized system would save hundreds of millions in paper pushing for both the insurance companies and the physicians. So much so, that these companies might be able to even retain a large chunk of their fat markups by recapturing the money from the waste that they engage in currently.
It would also unhinge the very corrupt business of placing medicines and medical equipment in the hands of doctors and patients. You would like to think that when a doctor is recommending a C-section, or a stent, that this is being done for an absolute medical necessity. In most cases it may be cut-and-dry. In those line calls though, is the doc going to vote with their wallet on your care? The California example would seem to suggest yes.
Hospitals are not much better either. Hospitals with the latest robotic technology will tend to want to use the machines to cure this and that and pay for the equipment. They did when MRIs were introduced. Again, if a test is medically necessary, no problem, but how many surgeries where this is "elected" is it really necessary?
On a case-by-case basis there is no way to tell, but national statistics, and the efficacy of such tests on health and mortality, are records that are tracked. If something isn't working, it should be dropped, or amended in some way that does work. Frequently this is lost in the byzantine world of different carrriers with 18 different policies each pushing and pulling on doctors and hospitals with their individual rules and regs.
On the flip side, many people cannot get life-saving MRIs or access to specialized medicines or surgical equipment because their insurance companies do not cover them.
An IRC will be needed to standardize and regulate the health insurance industry, so that the care you receive in California, New Mexico and New York are all roughly equal. Ed in Minnesota who needs an MRI should be able to get one as easily as Ed in Florida with the same symptoms and physical history. Right now, Ed in Minnesota could be denied while Ed in Florida sails through a life-saving test with his insurance picking up the tab.
Easy concept. So why does nobody do it?
Health care is a competitive business, as is health insurance. Companies play games to include and exclude doctors and patients. They change the rules of the game on doctors by using such a complex mire of plans that it makes it impossible for anyone other than a computer to factor out a patient's coverage or payment responsibilities.
For patient contracts insurers create "outs" in their contracts to force the insured to switch to products that cost the company less.
Blue Cross in Florida, for example, had me on one PPO which apparently they found too costly. They forced everyone over to another plan by ratcheting down the pharmacy payment provisions, which were flexible in the agreement that subscribers signed. Keep your coverage, but pay $100 -$200 a month per bottle of medicine. The meds start costing more than the health plan.
Life and home insurance is no less screwed up. A family can pay $6,000 a year just for the wind insurance in hurricane prone Florida, but pay next to nothing in Texas.
The other, perhaps most important reason for the Obama Administration to consider setting up a regulatory agency for Insurance is to make sure that their forays in to the investing and banking world are either curtailed or regulated enough that another AIG melt-down does not threaten the financial system.
Having the already-encumbered Treasury or the Fed to regulate Big Insurance is what the insurance companies want, as the foxes always like a distracted dog watching the hen house, particularly one with a watered-down mandate and no real authority to do much of anything in a situation other than a major financial crisis.
If the government can tell General Mills that it cannot make health claims that are unprovable for Cheerios, and dissolve and rebuild major banking corporations, certainly there is precedent for their being a regulatory body at the federal level for insurance.
The only millions of reasons against it are deposited into the campaign accounts of congressmen and senators on Capitol Hill.