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Feds Cut Medical Insurance Premium Up to 40%

July 6, 2011

Analysis of:U.S. health plans cut premiums for consumers with preexisting conditions | www.washingtonpost.com

CMS and HHS have cut premiums for Preexisting Medical Plans up to 40% to try and get more people insured under authority of PPACA.  Good news for the uninsured people who cannot afford standard or even subsidized premiums.  PCIP pays nothing to any agent to promote the plan, so it is no wonder enrollments are low.  

Medicare (MA) Selects 30 Pioneer ACO’s in Material Change to Status Quo

June 8, 2011

Analysis of:Medicare ACOs Present Unexpected New Challenges for Compliance Officers | aishealth.com

CMS to change status quo. We know what Medicare does, Medicaid and commercial carriers follow - especially if it costs less. Feds will assign blocks of “Aligned beneficiaries” in blocks of 5,000 lives in rural populations and 15,000 in metropolitan communities as fast as they can fine competent providers to accept their risk contract(s). CMS stated goal is move Medicaid and Commercial lives to capitation or fixed budget too.

Medicare and MA Funding and Where to Focus on Improving Earnings

May 3, 2011

Analysis of:CBO: Medicare Spending to Reach $528 Billion in 2010 (forcast to $1,038 Billion in 2020) | www.renalbusiness.com

It doesnt matter how many lives a plan enrolls, if they lose money on each life insured.End of life counseling aka Palliative Care Counseling is essential, or the expected cuts to Medicare will be bigger. Taming the defensive medicine beast,and changing fee for service income maximization mentality are the primary challenge for the new breed of leadership physicians accept. The entity that gets this together will blow away earnings.

Overhyped Health Stocks - Part 2 only 12,437 new enrollees since 9/23/10

February 14, 2011

Analysis of:PPACA: Federal PCIP Risk Pool Enrollment Reaches 12,437 | www.lifeandhealthinsurancenews.com

Per part 1, guarantee issue FEDERAL "exchange plans" aka PCIP (Preexisting Condition Insurance plans) have not generated the membership. Current employer and individual tax payer penalties are materially less expensive than complying with federal mandate to buy health insurance.

Successful ACO's: Medicare Commercial and Medicaid at Risk Contracts /Governance

December 30, 2010

Analysis of:A Model For Integrating Independent Physicians Into Accountable Care Organizations | content.healthaffairs.org

Successful operation of ACO, PHO, and various "integrated Delivery Systems" will require clear focus on measurable goals that get accepted by doctors. Historically, that is a big job that very few have done well. The common denominator to the many arrangements and structures is the assumption and management of risk. The essence of any good risk sharing agreement must reward physicians for better health in a method of objective and accepted Evidence Based Medicine measuring recovery and wellness outcomes.

Over-Hyped Healthcare Stocks Market

September 27, 2010

Analysis of:Employer Health Care Costs Expected to Rise 8.2% in 2011, Towers Watson Survey Finds | www.towerswatson.com

Looks to me like a market that jumped on buying healthcare stocks that rose in price from the added demand, but that will drop when the new enrollees do not materialze - while plan cost rise due to the mandates, and increased costs from remaining , older employees. SGwww.providerrisk.com

United Already Funded 12% in Preparation for $350,000,000 Fine

September 22, 2010

Analysis of:$350 Million UnitedHealth Class Action Settlement Approved | www.law.com

United's control over fee schedule percentile reinbursements is clearly known now. The University charged with preparing and managing the new unbiased and unfettered maximum allowable fee schedule is selected, and we are waiting to see what comes of it. United already took a 12% up-charge for increased fees it will be responsible for paying out as it DEFINES what allowable "Reasonable and Customary billed charges".

Health Care Costs Impact Profits - Health Reform: UNH, HUM, AET, CVH, CI

September 6, 2010

Analysis of:2010 Milliman Index | publications.milliman.com

Much speculation abounds about health reform impact on profit. It is clear that eliminating PreX on kids < 26 years, lifetime policy limits, co pays on Preventitive care (plus new eligible procedures) and capping out of pocket costs increase cost. Look at the facts to forecast profits. Milliman Index - "Employers and employees alike shared the increase this year, with employers total costs increasing 8%and employees total costs increasing 7.4%." Market share does not guarantee profits.

Health Reform: Medicare Advantage (MA) Plans

April 12, 2010

Recent passage of comprehensive health reform has left even the biggest carriers scrambling for answers. Bottom line is it will cost MA plans more to comply with the new mandates. Carriers have opportunity to favorably structure reinsurance, while remaining in compliance with federal authority. Many risk transfer options are available in this very hungry, very old market.(ING), (AET),(HUM), (CI), (UNH)Copy right 2010 c All rights reserved.

Reform Peril:Aetna, Coventry, Health Net, Health Spring, Humana, Cigna, United

March 26, 2010

Analysis of:For Consumers, Clarity on Health Care Changes | www.nytimes.com

Health Reform passed (219 to 212 votes). The recent passing of the $938 Billion health reform legislation will take 10 years to affect and plans to insure 32,000,000 uninsured. The originally stated goals of insuring the (individually) uninsured, without changing employer (Group) sponsored insurance have changed. The bill will now be considered by the Senate under the Budget reconciliation process that requires 51 vote majority. AET,">:AGP, CVH, HNT, :HUM), Kaiser, United UHN, HS.

Profits Perilous: Aetna, Cigna, Coventry health care,Humana,United health, Blues

March 22, 2010

Analysis of:For Consumers, Clarity on Health Care Changes | www.nytimes.com

It is not clear if this means "credible coverage" or "scheduled medical" insurance. One is expensive Major Medical and the other is not. However, the latter is typically more profitable.Individual and Group Premiums will increase, however covering preexisting conditions of children ( i.e. like Hemophiliacs at $250,000 - $900,000/year) may squash earnings. Big growth in Group Premium in 2014. Now, only about half of groups >50 offer benefits.

No Free Lunch for Federal Plan Offerings

December 3, 2009

Analysis of:Blue Shield of California Is Dropped from State High Risk Pool for 2010 | www.aishealth.com

Writing 6000 otherwise uninsurable lives predicts a loss of over $20,000,000 - $30,000,000 in CA. The Feds will need real wisdom to balance entitlement with affordable or subsidized "private" of "federal" insurance. The good news is that the market is hungry to reinsure organized "blocks of adverse selection", thereby relieving the tax payer over the long term.There is no free lunch.

HMO shares rise after Obama health reform speech

September 10, 2009

Analysis of:HMO Shares Rise - Threat or Opportunity | www.reuters.com

New pushes into the individual market by Aetna and Cigna, along with United, Humana, Blue Cross, etc prove real opportunity to capture 45,000,000 - 85,000,000 uninsured lives. The big unknown is how Not For Profit enterprise will access capital for Surplus reserves less expensively than Federal plans. For any commercial carrier to compete in a sustainable way will require equal access to capital or the state will win everytime.

Perfect Storm Batters Managed Care Profits (Aetna, Amerigroup, Coventry, Health Net, Health Spring, Humana, Kaiser, United and Wellpoint)

June 4, 2009

Analysis of:How Bad Will it Get (for Aetna, Amerigroup, Coventry, Health Net, Health Spring, Humana, Kaiser, United and Wellpoint) | www.nxtbook.com

The perfect storm for reform is intensifying.  We have been here before, but multiple factors will likely force real reforms that will challenge managed care corporate profits and even survival.  The PE 2008 ratios are out and the rate of decline is more concerning than falling numbers for Aetna, Amerigroup, Coventry, Health Net,  Health Spring, Humana, Kaiser, United and Wellpoint.  This “perfect storm” of federal debt, unemployment, record setting growth in Medicare eligibility, falling enrollments, adverse legal decisions like Ingenix, dramatically declining managed care company PE ratios, premium increases 500%+ CPI, and bipartisan political support poses real change to the status quo.  The hidden tornado of concern lay in the acceleration of negative change.

Will Feds Destroy Commercial Insurance?

May 21, 2009

Analysis of:Health Plans Would Add to Controls on Insurers | www.nytimes.com

The feds are no stranger to healthcare reform.  It failed under Kennedy, Nixon, and Clinton.  Common sense tells us that 20% (2009) indivudual, small group AND (10%-20%) large group premium increases, and cost-shift to commercial carriers is unsustainable.  Looking at federal reform now is a shot in the dark to what finally gets approved in the DC sausage maker.  One thing is dangerously certain.  If the healthiest commercial lives get to switch to a better rate or federal plan, it will leave the sickest people with each employer, and massively drive up experience rated premium in 1-3 years.  If the the opposite happens where only the sickest people are purged from the employer plan, then the federal program will require massive new tax subsodie.  There is no free lunch.     

Effect on HCC

May 11, 2009

Analysis of:Allianz operating profits fall 41% | www.ft.com

Alliance had a giant drop in earnings. 

Missing Earnings in Turbulent Times Hospital and Medical Insurers

July 3, 2008

Analysis of:AMA meeting: Delegates decry CMS no-pay list as unrealistic and call for revision | www.ama-assn.org

CMS (and several large insurers) refusing to pay for "Never Events" will further challenge cash strapped hospitals, and poses increased pressure to increase prices as hospitals attempt to cost-shift to the commercial carriers.  Not paying for alleged hospital mistakes will garner stronger administrative action against staff and doctors who get more adverse high cost patients.  The world of doctors will get more autocratic.       Hospitals cannot change Medicare and Medicaid fee schedules, but they can and do change commercial fee schedules.  Insurers need to stay on top of unexpected cost increases predicated upon unexpected and desperate hospital trying to keep the status quo on the backs of the commercially insured members.  Staying tuned to what the government subsidizes is the name of the game for successful insurers and providers of care.     

Ranking Doctors and Hospitals

May 8, 2008

Analysis of:Physician report card validity | physiciansnews.com

Ranking doctors and hospitals will certainly move the most profitable patients able to afford commercial health insurance AND travel.  Medical Providers who help set their (local) standards to affect real outcomes reporting regular consumers can understand will increase their market share.  Those who don't get involved will get what is left - the uninsured and perhaps lower paying federal or state insured groups. The future for hospitals and some physician specialities will be most turbulent.

Losses Loom in Pensulvania if Poltics Guides Health Insurance Absent

April 9, 2008

Analysis of:House OKs Limits on Health Insurance | www.post-gazette.com

Pennsylvania is a bell weather for hospital reporting in the US.  The "hospital costing containment council" (I forget the name) is famous for highlighting percentage of patients acquiring hospital infections after arrival.  Accountability for these very high costs lay with people managing hospitals and doctors supervising care of ancillary medical personnel, not insurance companies.       Arbitrarily assigning 15% of all premium to create plan, sell plans, pay premium tax on plans, administer claims, reinsure plans, contract with providers, do customer service, and assume first dollar risk is ill advised and threatens the both profits and commercial availability of medical insurance in PA. 

Organized Hopitals and Physicians Win More Medicare & Medicaid Contracts

April 1, 2008

Analysis of:Health insurers take a dive on WellPoint's warning | www.marketwatch.com

Regrettably, many physicians feel that dealing with dollars is less then fulfilling, especially in light of off-loading potential costs of defensive medicine.  The very turbulent times ahead will give employed groups of physicians a strategic advantage over individually fragmented doctors attempting to win managed care contracts.  Certainly, CMS will look to contract blocks of medicare (and medicaid) live with better organized hospital and physician entities capable of making a group decision to accept or reject a contract.  The game remains about lowering fixed costs.  The industrialization of medicine is here to stay.Paradoxically, it remains their best chance at maintaining professional and financial autonomy.  The capitated contract is tried and true, and does keep healthcare inflation down better then anything else we have tried over the last 20 years. 

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