Real Life | Our Health Insurance: Change and Troubling Challenges Ahead

The news media have been “celebrating” the 50th anniversary of Medicare and Medicaid by giving us some insightful, but also both vital and alarming, discussions about the future of our health care insurance.

It’s not news that longer life expectancy, medical science’s (expensive) new miracles, our higher-living-standards demand for better care, and the uninsureds’ acquisition of coverage predictably drive claims ‘way up.’ And you-know-who either has to cover the rocketing costs in one way or another, or to suffer dramatic reductions in coverage. In fact, both are likely, further impacted by inefficiency, overutilization, fraud, legislative kick-the-can-down-the-road myopia, corporate greed, and self-serving politics.

The Sun News recently carried Ricardo Alonso-Zaldivar’s Associated Press report, observing that the nation’s health care spending will outpace economic growth over the next decade, reaching 6 percent per year by 2019, squeezing the economy’s (that’s you and me) ability to pay for it. By 2024, nearly 20 percent of our economy’s expenditures will be for health care.

That’s the “average.” For the seniors sector, it’s headed for 50 percent.

Excerpting from McClatchy contributor Tony Pugh’s commendable discussion about Medicare’s and Medicaid’s future, (Sun News on July 30): “As millions of baby boomers turn 65 at the rate of 10,000 per day, Medicare’s costs will continue to rise, presenting a major financial strain for U.S. taxpayers and a labor force that won’t keep pace. To ensure the program’s viability, policymakers must find ways to sustain the current slowdown in the growth of health care costs. The Affordable Care Act is providing some of the solutions via care-delivery reforms and incentives that reward the quality, rather than the quantity, of care.”

“But more is needed, and policymakers will continue to debate possible solutions, like trims to benefits coverage and caregiver payments, higher taxes and even higher costs for affluent enrollees. Republicans have proposed replacing Medicare’s guarantee of coverage for new beneficiaries with a flat payment to seniors, known as a ‘voucher’ or ‘premium support’, which could be used to purchase private insurance or traditional Medicare coverage.”

“Medicaid, which has expanded coverage to higher-income adults with no children under the Affordable Care Act, will also face tough financial challenges as enrollment continues to grow. States that have expanded coverage have seen enrollment grow faster than expected, which presents long-term funding concerns.”

“Medicaid is generally a state’s largest expenditure after education. Republicans have proposed giving states a capped amount of money or a ‘block grant’… with less federal oversight... Democrats counter that if the federal grants don’t keep pace with rising costs and enrollment during economic downturns, states could end up with less federal funding over time…forcing cuts in services, reduced eligibility, caregiver payments cuts, or greater cost-sharing from enrollees.”

Well said, Mr. Pugh, in light of Newsweek’s July 22 Taylor Wofford’s story. Excerpting: “Obamacare has breathed temporary new life into Medicare, but the program, along with Social Security, is still on track to run out of money within 20 years, trustees of the programs announced Wednesday.”

Would repeal of Obamacare help? Quoting Robert Pear (NewYork Times, June 20): “No, according to the nonpartisan Congressional Budget Office. Repealing ACA would significantly increase federal budget deficits and the number of people who are uninsured.”

Among many other points, CBO predicts that over 10 years, insureds would lose $822 billion in subsidies, Medicaid $824 billion in federal contributions, and Medicare’s obligations would increase by $800 billion. And the offsetting reduction in the federal budget therefore would itself be offset by the resulting economy-wide cost burdens generated by the resulting unpaid health care and loss-of-productivity slow-down costs, thus increasing, not reducing, the deficit.

Here’s a not-so-surprise: In a July 29 New York Times story, “As Medicare and Medicaid Turn 50, Use of Private Health Plans Surges”, Mr. Pear observes that commercial health insurance companies are playing a rapidly growing role in both Medicare and Medicaid. Over 16.5 million Medicare enrollees are in commercial Medicare Advantage and Medicare Supplement plans, and over 33 million Medicaid participants have elected commercial coverage. But, he observes, it’s highly doubtful that commercialization, apparently beneficial for some right now, will cost less and better deliver services over the long run. I recommend this article to you; you can Google it.

Proponents make a strong argument for the advantages and economy of a single-payer, economy-of-size, non-profit, unpoliticized, extremely-efficiently-managed, fraud-and-waste-suppressing system. The health insurance industry could have vital management, risk-insuring, and claims administration roles.

Rays of light:

Some innovations are producing welcome results. Technology’s new miracles constantly improve health care, and reducing some costs. Digital data systems and legislation are making vital information quickly accessible to all providers who need it.

Providers are consolidating and teaming to provide efficient “single-umbrella” service. They’re also implementing experimental “bundle” pricing, packaged fees to cover all the care that a condition needs. Government and commercial insurers are beginning to pay providers to heal us with quality service instead of just seeing us and billing for visits, and to offer providers monthly retainers replacing individual-service fees. Political pressures, research and development assistance, and management improvements are starting to reduce drug company pricing.

Transparency legislation, regulators, and consumer advocates are gaining on the fraud and manipulation that hemorrhage tens of billions from Medicare and Medicaid. Consumerization is gaining: Corporate health care and insurance, spurred by judicial decrees, are acquiescing to offer solutions to consumers’ issues.

Ann Carrns offered some tips on managing high medical bills in her May 24 New York Times and Sun News article. Summarizing:

Medical providers’ prices aren‘t etched in stone. For really justifiable reasons, even the sharply reduced negotiated prices that insurers impose are compassionately adjustable. They’re also flexible when the service was quick and easy and the fee schedule rigidly therefore seems excessive for it. Some hospitals and clinics maintain philanthropic community help funds for deserving patients.

It’s perfectly OK to discuss your bill, especially up-front before treatment begins. Doc doesn’t turn away patients who need service, but have really limited resources. Prompt payment, rather than deferred or strung-out payment encourages discounts when requested. Building a “rainy-day” health-costs savings fund always is sensible. Consumer resources, such as the Healthcare Bluebook and Fair Health’s consumer website, reveal consumer standards.

Get really savvy about how your insurance works, and try to harmonize the treatment plan and timing to maximize the benefits.

Buying insurance, take on the highest deductibles and co-pays that you can handle in order to maximize high-end catastrophic coverage, and still at an affordable premium — for non-covered costs you can more easily find a few hundred or a few thousand dollars than several hundred thousand, right? Emphasizing the right benefit structure is more important than the cheapest premiums, anyway.

This one’s from me: Be courageous in challenging your insurance company, too, when you think they’re being unreasonable about a claim. Engage your agent’s assistance.

And, of course, you don’t need me or the experts to tell you to take good care of yourself to begin with – or do you? Procrastination and denial become costly.

Yes, looking ahead, it’s going to be a challenge, but also a fascinating, changing scene. And yes, there IS hope — unless ecological catastrophes from global warming do us all in, anyway

This story was originally published October 11, 2015 at 2:07 AM with the headline "Real Life | Our Health Insurance: Change and Troubling Challenges Ahead."