Last night, the Wall Street Journal reported on 20 large companies forming an alliance to target healthcare costs. As big companies are wont to do, they are unnecessarily complicating things. They can save themselves a lot of time and money by understanding two simple items that have proven to slay the healthcare cost beast. Massive pricing failure is the biggest factor in out-of-control healthcare costs. In contrast to most markets where price correlates with value, it is often inversely correlated in healthcare. The solution to that problem is outlined below. Primary care has been massively undermined in this country. IBM studied the impact of their annual $2 billion spend on health benefits around the world. The results were conclusive–the countries where there were the most robust primary care models delivered the greatest value. This is why they dedicated Dr. Paul Grundy to lead the renaissance of primary care.
Hackers already managed to compromise the health records of nearly 80 million Anthem customers in a high-profile breach earlier this year, but now analysts expect 1 in 3 patients will be similarly affected in 2016. Cyber attacks will continue to strike the health care industry next calendar year, IDC’s Health Insights group predicts in a new report, and the research firm expects around one-third of patients will be impacted as a result.
Unexpected questions can change a free wellness visit into an expensive diagnostic one. Patricia Jones thought she was getting the much-talked-about free physical under Obamacare when she went to see a doctor in May. But, she says, a few small things that happened during her checkup ended up making the visit cost more than $450.
Sen. Marco Rubio has been bragging he stopped a federal insurance "bailout" through Obamacare, but there's a place where insurers still could collect the money: a pile of money awarded by the U.S. Court of Federal Claims. If insurers chose, they could seek funds they were promised under the Affordable Care Act by appealing to the court, which decides disputes between the government and parties claiming they weren't paid money owed under a federal contract or a statute. So far, the thorny issue hasn't moved onto legal turf, even though insurers are irate that they're getting only a small fraction of the money the government was supposed to pay them for losses they incurred covering newly insured Americans under Obamacare. Insurance industry sources say there have been discussions about whether to bring a lawsuit, although there are questions about whether it's too soon since the federal government has two more years to make the payments.
The Health Insurance Association of America, under the leadership of Karen Ignagni, lobbied heavily in favor of the Affordable Care Act. Insurance companies shouldn’t get government money now that their bet is going the wrong way. Insurance companies thought they would have a captive market of young, healthy people who would be forced to sign up for expensive policies with the threat of penalties. But it was a cynical scheme. The premiums from young people, who do not use much health care because they are rarely sick, would be used to pay for the care of the old and the chronically ill. The Affordable Care Act was structured so that younger, healthy Americans would pay for everyone else, even though the young have higher unemployment rates, less disposable income, more student loans and fewer assets. Little did these insurance companies know that enrollment would fall far short of predictions. Enrollment in the exchanges is estimated by Health and Human Services Secretary Sylvia Burwell to be 10 million in 2016, compared with 22 millionpredicted by the Congressional Budget Office in May 2013. Insurance companies are not getting enough premiums to cover the costs of treating enrollees.