Archive for June, 2013

Would We Be Better Off If Employers Stopped Paying For Health Insurance?

Sunday, June 30th, 2013

Editor’s Note: Reinhardt is a genius. He has started a great debate:


In his “Are Employers to Blame for Our High Medical Prices?,” David Dranove takes issue with my statement in a New York Times blog post:

“One reason for the employers’ passivity in paying health care bills may be that they know, or should know, that the fringe benefits they purchase for their employees ultimately come out of the employees’ total pay package. In a sense, employers behave like pickpockets who take from their employees’ wallets and with the money lifted purchase goodies for their employees.”

He writes:

“The correct economic argument is a bit more nuanced. Employees do not care about the cost of their benefits; they care about the benefits. If an employer can procure the same benefits at a lower cost, the employer need not increase wages one iota. In this regard, there is nothing special about health benefits. Suppose an employer offers employees the use of company cars. Workers don’t care what the employer paid for the cars, and if the employer can purchase cars at a deep discount, it will pocket the savings.”


Reference Based Pricing, Individual Responsibility & Willing Providers

Sunday, June 30th, 2013


By William Rusteberg

Reference Based Pricing with limited balance billing advocacy and legal defense services is the “grown-up” way of offering employer sponsored health insurance.

We have all been worried about the effects of balance billing…………..upset employees, lawsuits, dinged credit, etc. But, if an employer educates his workers (Ah yes, just another chore for HR), for the first time plan participants will  understand that they have skin in the game. It’s called individual responsibility……………money affects behavior.

Balance billing advocacy and legal representation could continue to be important for emergency hospital admissions, while non-emergency services can be shopped for the best pricing and outcomes. Hospital bill audits would continue to be an important part of plan management, fulfilling fiduciary duties through prudent business practice.

There are service providers active in this market and more to enter, we expect.

The future, we believe, is in direct contracting with a limited number of willing providers at rates that are more attractive to providers than government reimbursement rates, yet less than the sometimes exorbitant managed care rates we see routinely. Proprietary panels of providers for specific employers ensures quick and efficient access to medical care versus waiting for days and weeks to see a primary care physician, or even months for a specialist once ObamaCare takes full effect in 2014.

Employers can and should initiate direct contact with their local provider community now.

Medical Care Consultants Inc.

Sunday, June 30th, 2013


Medical Care Consultants, Inc. (MCC) provides High-quality, low-cost, convenient healthcare that saves companies, employees and their dependents money on medical claims costs. MCC will provide a turnkey employee health clinic on or near site and is an “ADD-ON” to your current medical benefit program with NO PLAN CHANGES required.  With accessible and affordable care companies can save as much as 20% on their overall medical claims cost.

We will finance the start up cost to establish your employee health care clinic.    See


Hospitals Threaten ObamaCare Savings By Exiting Program

Sunday, June 30th, 2013

Almost a third of 32 hospitals and health systems involved in an experiment aimed at changing the way medical providers are paid may exit the program, a potential threat to the Affordable Care Act’s ambitious cost-saving goals.


The Culprit Behind High Health Care Prices

Saturday, June 29th, 2013

Uwe E. Reinhardt is an economics professor at Princeton. He has some financial interests in the health care field.

Elizabeth Rosenthal’s eye-opening article about health care costs in The New York Times on Sunday was a reminder of how much more Americans pay for given procedures than citizens in health systems abroad. What was probably more surprising to most readers was the huge price differentials for identical procedures — not only across the United States, but even within American cities, where prices for a given procedure can vary tenfold.

Perspectives from expert contributors.

These price differentials, it should be noted, have never been shown to be related either to the cost of producing health care procedures or to their quality.

The question, not addressed in the article, is who bears the blame for this chaotic, private-sector price system. The only fair answer is: American employers. Who else could it be?


Bending The Cost Curve With Reference Based Pricing

Saturday, June 29th, 2013

By Mike Miesen

“Broadly-speaking, reference pricing is the act of offering a set amount of money for the purchase of a good, where the reference is an amount that can reasonably said to offer meaningful coverage for that good.”


Debate: Are Employers Really To Blame For High Medical Prices?

Saturday, June 29th, 2013


Yes – “In Reinhardt’s thinking, employers did two things wrong. First, they were stupid: “For more than half a century, employers have passively paid just about every health care bill that has been put before them, with few questions asked.” Second, they were sneaks: “All along, they have been party to a deal to keep the chaotic price system they helped create opaque from the public and even from their own employees.”

No – “Employers in my acquaintance fight tooth and nail for more transparency from our reticent colleagues in the provider community; I have never had the privilege of meeting these low-IQ, scheming employers who are desperate to hide prices. Nor have I met an employer who looks forward to a day of mindlessly paying escalating health care bills; the ones I know try everything in their power to get those bills down”

Which argument wins? Continue reading………….then YOU decide


Getting Back To Normal

Friday, June 28th, 2013

By Allen Frances, MD

We have become a pill popping society. It makes absolutely no sense that twenty percent of our population regularly uses a psychotropic medicine and that the United States has more deaths each year from overdose with prescription drugs than from street drugs.


WellPoint Rolls Out Reference Based Pricing Model – Cost Plus W/O Balance Billing Protection?

Friday, June 28th, 2013

“As companies seek ways to curb health-care spending, insurer WellPoint Inc. is rolling out a program that lets employers pay only a set amount for a medical service, asking workers who select costlier care to pay the difference.”

Editor’s Note: Reference Based Pricing makes sense. Why pay one MRI center $4,300 for the same procedure you can get down the street for $650? Under the WellPoint model, if an insured selects the more expensive provider as in the case above, the patient would be responsible for the difference, or $3,650. This is steerage on steroids.

Cost Plus, or Reference Based Pricing, is gaining market share  through an ever increasing number of payers –


Bye Bye ICD-10

Friday, June 28th, 2013

Physicians, including the AMA, appear to be finally rebelling against tedious, questionable HHS coding rules which favor HHS, insurers and other HIT stakeholders more than patients. If the ICD-10 mandate fails because of lack of cooperation from doctors who are already overwhelmed with regulatory busywork, imagine the threat common sense presents Obamacare.


Young Americans May Dodge Health Law

Wednesday, June 26th, 2013

Young Americans may have been among the biggest supporters of Obamacare, but they may also be the least likely to comply with the law.

The architects of health reform say the law will make insurance more affordable and widely available. But in 2014, benefits experts say, the cheapest option for 20-somethings will be to pay the penalty for not buying health insurance, rather than paying for any health insurance at all—that is, provided they don’t get sick.


Neurologist Touts New Miracle Drug

Tuesday, June 25th, 2013


Humana’s CEO On Health Care Reform – Narrow Networks, Less Choice

Tuesday, June 25th, 2013

“Most of our products are going to be narrow networks and limited providers because we feel that is the best way we can offer a product that is going to be cost-effective.”


Tenet Makes Move In South Texas

Tuesday, June 25th, 2013

“The opportunity to expand in Texas at this time well in advance of full implementation of health reform is a very attractive feature of this transaction,” Fetter said.


Senators Look To Redefine PPACA Definition

Tuesday, June 25th, 2013

Two U.S. senators are calling on President Barack Obama to support legislation that would change the health care reform law’s definition of a full-time employee, shielding more employers from a stiff financial penalty imposed by the law.Under the Patient Protection and Affordable Care Act, employers are required effective in 2014 to offer qualified coverage to full-time employees — defined as those working an average of 30 hours per week — or be liable for a $2,000 penalty per employee.


The Future……………….

Monday, June 24th, 2013

By D. Kellus Pruitt DDS

1-darrellpruitt  If you have not yet noticed, the future doesn’t look good for the dental profession as we know it.

Like far too many neighborhood primary care physicians who can no longer make a profit on their own, managed care is having its way with dentists as well.


Witness: Medicare Needs Help From Private Payers

Monday, June 24th, 2013

costplus1“Managers of Medicare need help from private insurers to get controll over health care costs” – Robert Reischauer. Robert has effectively  endorsed Cost Plus Health Care ……………………………


My Name Is Rob. And I’m A Recovering Doctor

Sunday, June 23rd, 2013

By Rob Lamberts, MD

Yeah, I am recovering…doing a lot better, actually.  Things are tough, but they are a lot better since I left my destructive relationship with Medicare, Medicaid, and insurance companies.


Foster & Dunhill Bogus Insurance Scheme Ends In Indictment

Sunday, June 23rd, 2013

fosterTexans John Thomas and Lee Kidd were in the oil business, and owned Thomas & Kidd Production, Ltd., and related businesses……………..

Huge List Prices Charged By Hospitals Drawing Increased Attention

Sunday, June 23rd, 2013

“A provision in President Barack Obama’s health care overhaul says most hospitals must charge uninsured patients no more than what people with health insurance are billed.”


ObamaCare & The John Kerry Kickback

Saturday, June 22nd, 2013

confused-face2“The Kerry kickback didn’t get much notice, since it was cloaked in technicality and never specifically mentioned Massachusetts. But the senator knew exactly what he was doing.”


If Physicians Are Not Driving Up Costs, Are Discount Brokers To Blame?

Saturday, June 22nd, 2013

scared_face   “Since all providers and health systems have to inflate their master charge sheet (so that brokers can negotiate a discount), a procedure like the colonoscopy has price inflation.”  (See


San Benito ISD On-site Clinic Delinquent On Employee Withholding Taxes

Friday, June 21st, 2013


“Medrano, who said the district owns the clinic where Garza serves as its operator, said he wants the school board to go out for bids for a new operator or close the clinic. “I’m just concerned this clinic is not operating functionally,” Medrano said.”


Gallagher Benefit Services Inc – Growth Through Acquisition

Thursday, June 20th, 2013


Arthur J Gallagher & Company is an insurance brokerage giant with over 12,000 employees in 300 offices in 16 countries. Estimated annual revenue is +$2 billion (slightly more than  Growth through agency/brokerage acquisition continues to fuel Gallagher’s insatiable appetite for market dominance.  The most recent acquisition is a brokerage firm located in the Lower Rio Grande Valley, Texas.

May 20, 2013 – Arthur J. Gallagher & Co. Acquires Garza Long Group Founded in November 2011, Garza Long Group (GLG) offers a wide range of employee benefit program consulting services for their employer clients in the Rio Grande Valley and throughout Texas. They provide health and welfare strategic planning and design, voluntary benefits, wellness, benefits administration and human resource consulting with a specialization in public entity businesses. Robert Garza, Nick Long and their associates will continue to operate in their current location under the direction of John Neumaier, South Central Regional Executive Vice President of Gallagher’s employee benefit consulting and brokerage operations.


70% Of Americans On Prescription Drugs

Thursday, June 20th, 2013


Researchers find that nearly 70 percent of Americans are on at least one prescription drug, and more than half receive at least two prescriptions.


SEC Charges Plan Operators With Medical Ponzi Scheme

Thursday, June 20th, 2013


The U.S. Securities and Exchange Commission has charged two founders of a medical insurer with operating a Ponzi scheme.

The SEC said Tuesday that by the time their scheme involving Dallas-based Global Corporate Alliance Inc. collapsed, Duncan MacDonald and Gloria Solomon had collected close to $10 million from at least 80 investors and returned about $2 million to them in the form of Ponzi payments.


Government Considers Health Care Pricing Transparency

Thursday, June 20th, 2013

“…….the health care marketplace is not functioning adequately because prices do not appear to be based on the costs of producing a product, the laws of supply and demand, or the quality of the products and services.”


You Are Sick, Fatso. I’m Billing Your Insurance Company!

Thursday, June 20th, 2013


Physicians are not paid by health  insurance companies to treat people with behavior “problems.” They get paid  only to treat diseases. So, understanding where their bread is buttered, and by  whom, the American Medical Association has now identified obesity as a disease.  The Los Angeles Times had spotted the economic nature of the  re-definition.


The End Of The Illusionary (PPO) DISCOUNT

Monday, June 17th, 2013
AMPS Webinar June 20: Reference Based Reimbursement — The End Of The Illusionary DISCOUNT MyHealthGuide Source: AMPS, 6/14/2013,
Join CEO, Mike Dendy and EVP John Powers of Advanced Medical Pricing Solutions (AMPS) to talk about the “elephant in the room”.
Do not miss this opportunity to address what is on everyone’s mind; the ineffectiveness of PPO discounts in neutralizing inflated healthcare costs. And, while it continues to be the standard for some, there is a better alternative–AMPS Reference Based Reimbursement (RBR). During this educational webinar you will learn about this industry altering solution and get answers to all of your questions including: How do you protect the member from balance billing and how do you protect all stakeholders from costly appeals and litigation?About AMPS
Since 1995, AMPS has provided claims discounting, negotiating, and medical bill review services to the healthcare industry. Our Referenced Based Reimbursement is one of many solutions involving the AMPS team of medical professionals and legal experts who have years of experience and a track record of excellence in TPA, HMO, clinical and hospital settings. AMPS strives to put an end to illusionary discounts by reviewing each bill for unfair pricing, errors, and unnecessary services. For additional information contact John Powers at and (630) 361-2525.  Visit
Editor’s Note: We have used AMPS on some of our Cost Plus Groups with great effect. See

Doctors Dump Insurance Plans – Charge Patients Less

Saturday, June 15th, 2013

cashWe accept cash!”

WICHITA, Kan.,  June 14 (UPI) —
A Kansas physician says he makes the same income and offers better quality care to his patients after he dumped all health insurance companies.

Thirty-two-year old family physician Doug Nunamaker of Wichita, Kan., said after five years of dealing with the red tape of health insurance companies and the high overhead for the staff he hired just to deal with paperwork, he switched to a system of charging his patients a monthly fee plus the price of an office visit or test, CNN/Money reported.


Who Really Pays For Group Health Insurance?

Friday, June 14th, 2013

By William Rusteberg

Under the Affordable Care Act (ACA), due to take full effect in 6 months, group medical plans offered by employers must be “affordable.” The ACA definition of affordable simply states that plan participants pay no more than 9.5% of their gross income towards the cost of health insurance. To pay more is unaffordable and punishes the employer with onerous tax burdens.

A Kaiser study shows that nationally the average cost of employer sponsored health insurance ranges from 8-18% of payroll, or a median cost of about 13%:

Figure 3: Distribution of Health Insurance Costs as a Percentage of Payroll for Employees with Access to Coverage, 1999-2010


If an employer were to charge  each plan participant 9.5% of gross income, in some cases employees would be funding the entire health plan.

But isn’t this the case now? Health insurance has always been a payroll cost – in lieu of paying employees more they are paid less with the difference going to the insurance company.




ObamaCare: Unions Given Golden Opportunity To Increase Membership

Friday, June 14th, 2013


“It clearly isn’t going to be a morale-boosting moment when you redo your health plan to discourage participation,” said Stern, the former labor leader, now a senior fellow at Columbia University. “It’s not something most want to advertise………………….”


Transamerica Life Insurance Named Fastest Growing Voluntary Benefits Carrier

Thursday, June 13th, 2013


LITTLE ROCK, Ark. – June 13, 2013 – The annual U.S. Worksite/Voluntary Sales Report produced by marketing advisory firm Eastbridge Consulting Group, Inc.* identified Transamerica Life Insurance Company-which markets voluntary benefits through its Transamerica Employee Benefits business unit-as the fastest growing company based on voluntary sales for 2012 among large companies. This recognition comes as Transamerica Employee Benefits is expanding its national sales team in key growth markets across the U.S.


Lawmakers & Aides Quitting Over ObamaCare?

Thursday, June 13th, 2013


Dozens of lawmakers and aides are so afraid that their health insurance premiums will skyrocket next year thanks to Obamacare that they are thinking about retiring early or just quitting.

The Affordable Care Act — signed into law in 2010 — contained a provision known as the Grassley Amendment, which said the government can only offer members of Congress and their staff plans that are “created” in the bill or “offered through an exchange” — unless the bill is amended.


“Good Job Negotiating United HealthCare!”

Wednesday, June 12th, 2013

Just because you have health insurance, it doesn’t mean you’re necessarily getting a good deal on your health care.


Hospital Billing

Wednesday, June 12th, 2013

Hospital Bills are, for the most part, works of complete fiction.  Inflating the charge on every service a hospital provides has two major consequences:

a. It gives an unrealistic (inflated) impression of how much health care really costs.

b. It further allows hospitals and insurance companies to abuse people.


Unauthorized Immigrants Account For Only 1.4% Of U.S. Medical Spending

Wednesday, June 12th, 2013

immigration   by Chris Fleming

Unauthorized immigrants have lower health care expenditures compared to legal residents, naturalized citizens, and US natives, Jim Stimpson and colleagues from the University of Nebraska Medical Center report in a Health Affairs Web First study released today. Over the 2000-2009 period, US natives accounted for about $1 trillion in average annual health care spending; all immigrants spent  about one-tenth of that amount, or $96.7 billion. Unauthorized immigrants accounted for $15.4 billion of that total, or 15.9 percent.

Analyzing health expenditure data from the Medical Expenditure Panel Survey by nativity and legal status, Stimpson and coauthors found that just 7.9 percent of unauthorized immigrants had health care spending from public sources, averaging $140 per person per year. By contrast, 30.1 percent of US natives had health care spending from public sources, for an average of $1,385 per person per year. Average emergency department expenditures for unauthorized immigrants were $54 per year, compared to $138 per year for US natives.

The authors also found that an estimated 5.9 percent of unauthorized immigrants received care that providers are not reimbursed for, compared to 2.8 percent of US natives in the same category. They posited that this may be because unauthorized immigrants are much more likely to lack health insurance when compared to US natives.

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New York Eyes Probe Of Captives

Wednesday, June 12th, 2013

 “Lawsky said the probe found that New York insurers were making inconsistent, spotty and incomplete disclosures, and diverting reserves as a means of showing “artificially rosy” capital buffers.”

(AP photo/Mike Groll)
(AP photo/Mike Groll)


Ordering A Pizza Under ObamaCare In 2014

Wednesday, June 12th, 2013


Enrollng For Medicare

Tuesday, June 11th, 2013

By Molly Mulebriar

Enrolling for Medicare is an easy, quick process. Internet based, one has only to complete a short, simple application (takes about 10 minutes) and your done. No health questions, no PPO directory to review, no height and weight question, no medical questionnaire to worry about……just indicate who you are, your birthdate, Social Security Number, and a few other generic questions.  No waiting period for pre-existing conditions.

In 1973, Blue Cross Blue Shield of Texas representatives did not have internet enrollment capabilities, but the application was much the same. The size of a post card, the only questions to be completed were (1) Name, (2). Address (3). Social Security number, (3). List of dependents and ages of all applicants. No health questions, no height and weight box to complete, easy and simple.  No waiting period for pre-existing conditions.

Starting in 2014 we suspect enrollment applications will be simplified since there can be no pre-existing condition exclusions. The days of “underwriting” a group health risk using health questionnaires will end.

However, through state exchanges, now called Marketplace, pricing “underwriting” will be necessary because of government subsidies. Instead of a simple, ten minute enrollment like one finds on for Medicare applicants, a 22 page application is required to be completed, mostly related to one’s finances.


This Won’t Turn Out Well – IRS About To Enforce Contraception Mandate

Sunday, June 9th, 2013

This Won’t Turn Out Well

On August 1, the one-year “safe harbor” for religious charities objecting to provisions of Obamacare will end. Starting then, these nonprofit employers will be forced to violate their religious beliefs or pay large fines. In charge of collecting the fines will be our recently newsworthy friends at the Internal Revenue Service

Evidence Supports Medicare For All

Friday, June 7th, 2013

medicare“In contrast to the limited networks of doctors available to the privately insured, and the appalling “under provision of services” to those left uninsured and underinsured by today’s for-profit, market driven system, a Medicare-for-All system would expand choice and access.”


Aetna Puts Spin On MLR

Thursday, June 6th, 2013

The federal government has mandated that health insurance companies must share their profits with the masses – socialism. Aetna touts “appropriate pricing” in a press release issued today.


Brownsville ISD Board To Reconsider HealthSmart Lawsuit?

Wednesday, June 5th, 2013


It’s As Easy As Suing A Ham Sandwich!

The Brownsville Independent School District Board of Trustees approved a motion last night to reconsider implementation of a lawsuit against HealthSmart.  Controversy over PPO discounts, allegedly promised but not delivered,  have simmered for the past several years. A previous Board of Trustees instituted a lawsuit against HealthSmart, only to subsequently drop it after a new School Board was sworn in. Now, once again, another new Board of Trustees is in place (Board No. 3) and the HealthSmart matter is once more front and center.

Elections seem to have consequences, especially in deep South Texas where local politics are taken seriously – a blood sport.

See Brownsville Herald story here:

Urgent Care Centers – A New Opportunity?

Wednesday, June 5th, 2013

“All of the health management and medical care is moving over to the health systems and clinic operators.”   New Markets For Urgent Care Centers

Texas Passes Captive Law

Wednesday, June 5th, 2013

By   | May 31, 2013

Texas has passed a law allowing for the formation of pure captive insurance companies within the state.

Companies doing business in the state are now authorized to self-insure, or provide reinsurance for, its own and its affiliate’s operational risks such as employee benefit plans, liability insurance and worker’s compensation insurance.

The new law allows for companies to open its own carriers in the state, but does not permit the formation of independent captive insurance carriers in Texas. However, the Texas Department of Insurance (TDI) may approve foreign captives to transfer domiciles to the state on a case-by-case basis.

In an analysis of the bill, the state’s House wrote, “CSSB 734 would create a healthier business climate for corporations that have or would like to have a domestic captive insurance company. When a Texas-based corporation must form its captive in another state, in incurs additional expenses and administrative burdens. For example, other states often require captives to engage locally based management companies, hold a minimum number of board meetings within their first jurisdiction each year, and appoint a local resident to the board.”

In order to obtain a certificate of authority from the TDI, the pure captive must have significant operations and keep its principal office and records in Texas, and hold at least one board of directors meeting in the state each year.

Captives will be taxed on half of one percent of a captive’s premium receipts and other forms of revenue from its annual insurance policies. The maximum tax would be half of one percent on a captive’s taxable premium receipts and other forms of revenue from annual insurance policies. The annual minimum captive tax is set $7,500 and the annual maximum tax is $200,000.

The captive will have to maintain a capital and surplus of at least $250,000 in order to operate.

“Allowing domestic captives to form in Texas would attract new business to the state and would help retain existing Texas companies. In addition to lowered taxes for re-domesticated firms, the bill would attract high paying jobs, including attorneys, accountants, actuaries, and their support personnel. It would also result in new revenue for the state through the insurance premium tax,” said the House analysis.

Texas captives would not be allowed to participate in any insolvency pools or funds in the state

Colonoscopy Costs & $2.7 Trillion Medical Bill

Sunday, June 2nd, 2013

Editor’s Note: Colonoscopy in Harlingen, Texas cost: ASC = $550, Physician = $900, Anesthesiologist $185 = $1,635 Total Cost. Note: The ASC is a physician owned facility.

Brownsville ISD To Sue HealthSmart…………..Again?

Saturday, June 1st, 2013


B31. Recommend approval regarding confidential and privileged matters.  –  a. Discussion, consideration and possible action reference to potential litigation regarding HealthSmart  (Board Member Request – MP)

Editor’s Note: This is interesting , in more ways than one. Kind of like suing a ham sandwich. It all revolves around PPO “discounts”, or the lack thereof.