Archive for October 27th, 2010

Aetna Fires Brokers – Goes Direct

Wednesday, October 27th, 2010

Important information regarding Aetna Individual Medicare Supplement PlansSM in Texas 
 Effective December 1, 2010, Aetna will no longer be paying any compensation through our  external broker distribution channel for new sales of the Aetna Individual Medicare Supplement Plans in the state of Texas.

 If you are currently licensed and appointed to sell our Individual Medicare Supplement Plans in Texas, you will receive a letter amendment modifying your Aetna Producer Agreement. 

 Q&A

 What plans does this apply to? This applies to all Individual Medicare Supplement Plans sold in the state of Texas (Plans A, B, C, and F), including coverage for under-age 65 disabled individuals who qualify for Medicare, as well as for ages 65 and over.

What is the effective date of the change? This applies to all policies with an effective date of December 1, 2010 and later.

What if an application is in process? This will apply to all new business with effective dates of December 1, 2010 and later, even if applications have been submitted for processing.

What will happen to the commissions due to renewal business? Producers will continue to receive the normal compensation for any Individual Medicare Supplement Plan sold in Texas with an effective date before December 1, 2010.

Why is Aetna eliminating compensation paid to external producers? After carefully reviewing Aetna’s business results for the Individual Medicare Supplement Plans in Texas, we determined that a change in strategy was necessary at this time to remain competitive in this market.   Aetna will continue to review our business results with the Individual Medicare Supplement product in the state of Texas to determine the best strategy to remain a strong competitor in that Individual Medicare Supplement market. 

If you have any additional questions, please contact the Aetna Medicare Broker Service Unit at (888) 247-1050.

Med-Mal Down, Doctor Shortage Up?

Wednesday, October 27th, 2010

 Jordan Smith  Thu Oct 21, 8:08am

Tags: Tort Reform, Legislature

According to the Texas Medical Association, the 2003 tort reforms they pushed so hard for are paying off – for reals.

That’s right, according to a September press release from the TMA (the largest state doctor’s association), tort reform worked so well that that the Texas Medical Liability Trust – that’s the not-for-profit medical malpractice insurer that insures more than 14,000 TMA affiliated docs – has again reduced its premiums and offered a 24% dividend to current policyholders. That’s some scratch!Enough scratch, it seems that the TMLT is among several groups that have organized for tonight (Thursday) a nice meet-and-greet schmooze fest at the Ferrari dealership on North Lamar. “Come as you are – bring your spouse, physician colleagues, and your business cards. Light refreshments served.”

That’s awesome. Just super duper. I mean, sure, it’s great that docs and their insurers can again afford Ferraris (yeah, I know they’re only schmoozing there, but, please: Do you think the Ferrari dealership opens its doors to, say, a public school teachers social? I think not) – especially considering the dire, dire predictions we were given back at the beginning of the decade about how doctors would be run out of business, and out of the state, because of high med-mal rates prompted by frivolous lawsuits.

And to hear Gov. Rick Perry tout the tort reform package in his 2007 State of the State speech, it was the courageous reforms pushed through by lawmakers – that is, a package of measures that limit the ability of individuals to avail themselves of the legal process and to sue in cases of medical negligence – that have lowered med-mal costs and helped to recruit doctors to the state.

Hmmm. That sounds super good, but is it true? Not at all, according to Texas Watch. For starters, the state still has the highest rate of uninsured residents, with nearly 25% of the population without any health insurance. And, moreover, according to the TMA, the state now ranks 42nd in the country for the number of doctors per capita; nearly half of all Texas counties do not meet the national standard for having 114 doctors per 3,500 people, according to Texas Watch.

Wait, what?

Yes, it is true, we’re still short on doctors. But how can this be, you ask? I thought tort reform was supposed to take care of everything? Apparently you thought wrong. Indeed, according to Dr. Gary Floyd, the chief medical officer for Fort Worth’s John Peter Smith Hospital, the real problem is that the state hasn’t created enough residencies for all the doctors educated in the state, in part with taxpayer money. If there aren’t enough residencies, he told the House Committee on County Affairs during a hearing held at the hospital, the doctors will go elsewhere to finish training and then will likely stay put in those places.

And you know why there aren’t enough residencies? Frivolous lawsuits? No, no, we took care of those. The real problem, witnesses told the committee, is that Medicare and Medicaid funding caps have “forced” healthcare agencies to “freeze or scale back” residency programs, Floyd said. The TMA, reports the Fort Worth Star-Telegram, is expected to advocate during next year’s Lege session for an expansion of the number of residencies in the state.

In other words, it appears now that tort reform wasn’t exactly the panacea we were led to believe. And it certainly didn’t create a rush of doctors flocking to, or staying in the state as we were led to believe it would.

Well, crap. At least we still have the Ferraris.

 

SPBA Email Alert – Health Reform Insights

Wednesday, October 27th, 2010
SPBA Email Alert – October 25, 2010

Health Reform Insights

Personal candid observations from SPBA President Fred Hunt

REPEAL REDUX
I’ll be saying this a lot because, you are an informed insider, and it is important as a reality-check in the coming weeks & months.  Talk of repealing health reform is just talk.  Not only is there the obstacle of Obama still President with a veto pen (thus requiring the numbers & determination of a 2/3 vote to override the veto), but opposition softened a bit as many conservatives and formerly-fierce opponents suddenly had their worry about getting their under-26 children covered, and those with pre-ex, and those blood tests and things that are the main health costs for most healthy people.  They still oppose the concept…but getting used to goodies sways public and political opinion.

There is no question that pieces will be changed, eased, repealed or de-funded.  However, they are apt to be more broad  & nonsensical items like the 1099 reporting, prescriptions for non-prescription items, etc.  The biggest changes in health reform will come from unexpected things, such as how states react in their many implementation duties of health reform, how the Feds will respond if states stall, if exchanges bomb for whatever reasons, if medical IT doesn’t evolve as expected, if millions decide to game the system by just getting insurance when they are sick, etc.  The fate of the health insurance industry also hangs in the balance of some flukes and what areas may still be open to them (such as ACOs)

So, this is a pre-election reality check that if Democrats & health reformers go down in flames next week, and the media is on over-drive discussing imminent repeal or big changes, it is unlikely to play out as predicted.  That is the reason that these e-mails from me tend to focus on factors that might not seem directly related to TPAs, self-funding, and employee benefits.  You need to understand the side issues which will probably trigger any significant changes.

Looking further ahead, pundits will inevitably start pointing to after the 2012 Presidential election as the time of major repeal and change.  However, by 2013, the health scene will have already changed considerably, and people will have gotten even more used to things they like (or are told they will like) .  Besides, by raising expectations in 2010 for dramatic change which they are pre-doomed to not be able to achieve (not to mention the significant chance of a bloody civil war within the Republican party), by 2012, the Republican party may be seen by fed-up voters as the do-nothing party to be thrown out.  So, don’t take the media’s simple predictions too seriously.

Frankly, I think that the biggest changes in health reform will be where it crashes down from its own unworkable assumptions, such as some of the issues described below.

AVOIDING THE TOUGH FIGHT
The Washington Times recently had an excellent guest article walking through the early political strategy and missed opportunity of health reform.  Health reformers could have gone after the real problem of US healthcare…..runaway costs.  However, they soon realized that that would trigger massive opposition from doctors, hospitals, medical manufacturers, etc.  (In politics, the “Dr. Welby” effect, named for the on-screen feeling generated by the kindly wise TV doctor, plus the comment from a Congressman that “All of us feel vulnerable, and want to be agreeable because we’ve been in a skimpy gown with our doctor or in a hospital” has always had a very strong effect not to upset the medical community.)  Besides, it would be easier to sell health reform if the medical community were cheerleaders.

So…instead, the focus/goal was set on making care more efficient (cutting billions of dollars of waste & abuse), and creating options for coverage, especially for people with high risk situations.

On the over-use issue, Americans already go to the doctor less often, stay in hospitals fewer days, and pop fewer pills than people in other major industrialized countries (with government plans).  So, we seem to be world leaders in not over-using.  The problem in the US is that each of those fewer medical interactions costs much more than in other countries.  But to solve that problem would be to upset the medical folks and unleash their political opposition.

SELLING DESIRED PRODUCTS?
Reformers should have known that the desire for coverage, especially for children and pre-ex situations was more emotional than real.  The S-Chip program for children was already failing to attract anywhere near the expected number of eligible children.  

Pre-ex “discrimination” was a major topic reformers used to bludgeon “evil” insurers ad employee benefit plans.  Health Reform funded a temporary pre-ex program for states.  Those government-assisted pre-ex plans are getting embarrassingly few sign-ups.  

Why aren’t the millions of Americans supposedly craving for access to such a plan rushing to sign up?  Plans for high-risk and pre-ex is actuarially expected to be expensive, even with state & federal dollars to subsidize.  However, states & Uncle Sam are discovering that when Americans say they want “coverage” (and this applies to S-chip, under-26 children, and will apply to many aspects of health reform), they expect FREE or extremely cheap.  A recent survey found that the majority of Americans think that the state exchanges in 2014 will be free or super-cheap bargains.  When it comes to health care, the national motto is Something for Nothing.  This unrealistic expectation is going to undermine many parts of health reform.

So what to do about the dud pre-ex programs??  The government pre-ex programs are going to spend more millions of dollars to hire professional marketing/PR firms and advertising to lure pre-ex people into the plans that the politicians said they had desperately wanted.

FUTURE OF EXCHANGES?
Uncle Sam has already sent an average of $1 million each to 48 states and D.C. to get state exchanges started for 2014.   However, many states are dragging their feet for political or practical reasons.  Exchanges are the crown jewel of the health reform vision (and seen as perhaps a stepping stone to centralized health coverage).  What if states sputter or refuse to proceed with creating exchanges??  Uncle Sam has the authority, money, and will power to step into a state (unless Congressional de-funding intervenes).  Meanwhile, both HHS and some states have been using the threat of blackballing insurers from participating in exchanges as a bludgeon.  But, what if most or all insurers, have left the market, decline to be in exchanges, or have been barred for some reason??  Then you have an exchange with no insurance to offer.  Also, if a state refuses to set up its own exchange, and Uncle Sam sets one up in the state, how well will that work?  Won’t that be the embodiment of the old joke, “I’m from the federal government, and I’m here to help you.”

ELECTRONIC HEALTH RECORD STATUS REPORT
EHR (also known as Electronic Medical Record or EMR) is mandated by the Stimulus to be in place by 2014.  An IT trade group, CompTIA gives a snapshot status report:  Half of providers are using some form of EHR/EMR.  34% are fully using EHR/EMR.  16% partial usage.  20% evaluating the concept.  9% not yet thought about it.

Most of us have heard or assumed that HIPAA privacy & security were the providers’ main concerns, and there have been some reports that providers are uncomfortable having such a handy comprehensive record, because it invites fishing by attorneys for malpractice cases.  However, the CompTIA survey reports that providers feel that it seems impersonal in the doctor/patient relationship.  Also, 80% of doctors say that EHR/EMR users need more training in the technology.

Unwillingness to spend has also been a recurring theme when technology is mentioned to providers (the reason so few providers invested the money to get up to speed with EDI, when payers were required by law to do).  However, 1/3 of health care practices reported that they expect to increase their IT spending more than 5% next year.

UNCLE SAM”S HEALTH PLAN
The Federal Employee Health Plan (FEHP) is often used by politicians as the gold standard of what employee benefits should be.  For 2011, they are expecting a 7.2% increase (8.8% in 2010).  By comparison, recent surveys have estimated that private health plans expect about 8.8% increase for 2011.
FEHP hypocrisy:  Politicians have been nagging for decades for private employee benefit plans and insurers to take in high-risk people and other people without coverage (and thus laws like COBRA).  The chorus after such pontifications was often to say how wonderful the FEHP is.  One time, SPBA called their bluff.  We said that we agreed that all Americans in whatever medical condition deserve health coverage, and so they should be allowed to sign up for the great and glorious FEHP plan which those Americans’ taxes supported.  Wow!!  There was shock, and all sorts of sputtering double-talk about why FEHP would not be a good place for such Americans.  It was clear that the feds were looking down their nose and that they wouldn’t want high risks and just anybody in THEIR prized plan.  Needless to say, our suggestion died.  However, when some politician or bureaucrat wants to load up your employee benefit plan, ask them why the tax-supported FEHB wouldn’t be the more patriotic & democratic solution for all unfortunates to buy into. ☺

Fred