In response to House Republicans Pressure HHS on MLR
Gary Duell wrote:
“The root problem is blind self-interest. I know of no nonprofit health insurance agency, do you? We’re all in the business to make money (and, yes, to provide great value to our clients), so it is utterly absurd to claim our commissions should not be included in the MLR. We are not health care providers. Despite the waste and abuse, Medicare is still the most efficient healthcare delivery system we have. Due to the accounting magic they employ, who knows how much waste really exists in our ‘private’ (heavily subsidized by taxpayers, by the way) health care delivery system? It’s a false comparison to set Sebelius’s estimate of Medicare waste next to the MLR. And let’s not forget that ‘Obamacare’ is really Republicare, as it has little resemblance to the plan our President wanted.”
Mike Carey, CLU, wrote:
“This survey seems to resonate well with what I think will happen initially. The costs will be higher. Those with high-cost group plans (unions, government, substantial corporations) will continue.
“For those individuals without coverage now, the question will be how much of the cost will the subsidy cover. For those in a lower income strata, Medicaid will mushroom with new entrants.
“For small businesses, the costs will dictate how long they continue to provide group plans, if they already have a plan. The majority will continue the trend of dropping coverage after 2014 and having the individual assume responsibility for his own health care, possibly with some subsidies from the company. As for those small businesses currently without health care, they will remain out of the environment with the current uncertainty.
“What I would predict is that among all employment groups, individual uncertainty will be sharply rising. With the retirement of a large percentage of doctors, the availability of medical services concerns will not be just limited to those on Medicare but spill out among the entire population. That will drive some to hold on to their jobs and coverage just for access.
“One trend will grow exponentially. This is that of U.S. citizens seeking care outside of the country. Costs, access, and quality of service will propel the more informed to travel.”
In response to Rogue Forces
Chuck shared his own rogues list for the industry:
“1) Politicians who add benefit mandates to score political points. Insurance is intended for and works best with low-frequency, high-cost, unpredictable events (i.e., insurable events). Requiring the insuring of non-insurable events is wasteful and serves no useful purpose beyond scoring political points, raises loss ratios, and increases premiums.
2) Complex detailed regulations (e.g., policyholder taxes, XXX reserves, etc.) that create never-ending rounds of complex products to take advantage of loopholes and patched regulations to fill those loopholes. The complexity ensures this spiral never ends.
3) Pols, pundits, etc., who continually promote the idea (to suit their own purposes) that the insurance business is inherently evil. This gets in the way of any real improvements of the business.
4) Companies who’d rather lie low regarding 1 through 3, sometimes trying to take advantage of those issues for their own purposes, instead of confronting them head on.”
In response to Dreaming of a Part-Time Congress
“I spoke recently with one of my former Congressional representatives from my district. His two years in Washington was a nonstop quest for money from all kinds of interests that expected him to return the favor with his legislative votes and the influential power of his office.
“He said it was a treadmill without end, and his trading of his own political influence for money was completely expected as the way things are usually done. He hasn’t been back to Washington since his term expired, and does not regret leaving behind the huge pressures to use his influence to extract money from the people any way he can.
“This is what basically good people experience when they go to Washington as elected representatives of their constituents. All the good intentions to do right by the people fly completely out the window because of the rampant corruption that is Washington, D.C.
“We cannot expect good results out of a criminally perverse environment — it is not enough to change the people, but the rules in Washington also need to change to promote virtue instead of creating gangsters who shake down our citizens and organizations for that protection money and extortion that fuels our government.”