“Healthcare” CEOs Hate You

Healthcare CEOs Shoot Themselves in the Foot | Mother Jones

Article about hearing where CEOs of healthcare companies display the arrogance that will be their undoing. Even if you pay into their systems for years, they will drop you from the plan using a process called rescission. In plainer terms, it’s called getting screwed by an immoral corporation.

UPDATE: Source article in the LA Times. Best bit:

“It also found that policyholders with breast cancer, lymphoma and more than 1,000 other conditions were targeted for rescission and that employees were praised in performance reviews for terminating the policies of customers with expensive illnesses.”

You can watch the three-plus hour hearing here.

Q: Where’s the “free market” now conservatives?
A: The free market can’t talk right now, it’s buy figuring out ways to no longer offer insurance coverage to the people who need it most.

Broken system. Time for change.

Via: Daring Fireball.

  • http://nelking.myopenid.com/ nelking.myopenid.com/

    Don’t even get me started. This is one of those conversations where our household can not refrain from using the F Bomb. Dingell has it right, good public coverage will force an attitude change for private insurance making it all better.

  • http://www.digitalcatharis.com themightyjimbo

    i’ve worked in healthcare and life sciences for nearly two decades. this is perpetually an issue for me. the system is indeed busted – and busted badly. we operate a system in which providers are incented by doing more procedures and payers are incented to do less. nobody is compensated for wellness, and the challenges and costs of the system keep people from receiving care that could dramatically reduce costs later after a preventable illness get critical. drug companies have the toughest business in the world, but the govt doesn’t enforce price controls, thus subsidizing all the countries that do. and we remain the only modern, western nation, in which a serious traumatic injury or illness leaves you bankrupt and, potentially, without insurance later – even if you have it currently.

    none of this, of course, is news to anyone.

    the question i ask about the benefits of a publicly driven hc system as apposed to a market driven system is simply this: should an amoral force like free markets be used to dictate the availability (and quality) of healthcare? companies are beholden to share holders first, customers second. and our current system seems to keep those customers a DISTANT second.

    (i always wonder what happens when the shareholders get sick?)

    the argument is that the customer can then shop for a different choice of insurance. of course, as anyone with anything that even resembles a preexisting condition will tell you, there is no choice. again, the market deciding on an issue that i would argue has clear social and moral implications.

    one last question: why the societal fear of a public healthcare in he first place (beyond just the costs associated – costs that need to be controlled regardless of the hc model you choose). we trust (most of us anyway) the public to educate our children. to protect our cities. to guide our airplanes. to put out our fires. to fly a letter from LA to NYC for under fifty cents. why not mend our wounds?

    a republican social – libertarian friend of mine argued that with every growth of of govt and every regulation, liberty dies.

    i argued with him that this opinion is a luxury for an affluent white male with an advanced degree. i wonder how liberated a diabetic, single-mother, wal-mart employee with two kids and no insurance feels when she has to choose between rent and healthcare.

    sorry to run off in your comments. healthcare in america just fires me up.

    • makfan

      You make a lot of good points. Another is that for most of us, our employer choose our health plan. At larger companies, you might have a few options such as Kaiser/HMO vs. PPO with a couple of deductibles. Why in the heck should I have to choose my career based on who has the best health plan for me rather than the job which bets fits my skill set and temperament?

      I was recently put on blood pressure medication. Fortunately, we noticed it had crept up during a recent checkup, and it stayed a little too high during a few follow-up checks. My doctor wanted me to get a BP monitor at home so we can see how I handle the medication. Of course, my insurance doesn’t cover it. They’ll pay for me to go to the office every few weeks to get it checked, but not $80 for a monitor to use at home. It makes no sense to me.

      • lou

        When a GP takes you on an HMO plan they receive a Per Capita fee per month whether you utilize the service or not. So the GP’s services are “free” beyond this initial payment from the plan.

        Of note, GPs are then given additional incentives (usually a fixed fee or a multiplier on their aggregate Per Capita per month) to stay open longer, work weekends, etc.

        It’s important to note that the GP is thus monetarily encouraged to take on more members than they can necessarily serve should a large portion of the population become ill. However, they are also monetarily encouraged to work weekends and long hours to increase coverage and access.

  • nobody

    So you sell a complex product with potentially high financial risks, and you need information from your customers to price and manage that risk, and those customers often have incentive to mislead you, BUT if you want tools to manage the exposure from such misrepresentation, you are a Bad Guy.

    For some reason, neither article gives a thorough discussion of why companies might do this.

    Emotional appeal does not indicate correctness.

    • http://blurbomat.com/wordpress blurb

      But from a moral standpoint, the motivations are clear: you get sick, the insurance company can and will drop you at their discretion.

      From my standpoint, another reason why insurance companies are failing society. The motivation is not to provide service it is to manage risk. That is at odds with the stated purpose of the company.

  • lou

    My biggest fear with a public payer system is that the government will decide that a substantial cost comes from physician salaries. We’ve gone through 5 years of living together, but not really being present to each other, with 3 more to go. That’s an investment we’re making in her career and our financial future. If the government were to come in and unilaterally change that outcome I don’t know how I’d handle it.

    I know the discussions should center around coverage and wellness, but being on this side of the fence i just want my wife to be able to heal people and be rewarded for the immense effort she’s put forth and the very large financial risk we entered into.

  • http://satirereport.com Michaelpowers

    I honestly do not understand how we are so naive to think that the government will some how do a far better job. Are we impressed with the USPS? Has the government done a good job with medicaid, medicare, or social security? How about the FDA, the Fed, etc.?

    The fact is, even if the government could effectively manage healthcare, we just don’t have the funding (just look at how the deficit has doubled in the first few months of this administration, and promises to quadruple by the end of the year), and the truth is, the government watchdogs have no watchdogs. The latin phrase “Quis custodiet ipsos custodes?” is quite relevant. It means, “Who watches the watchers?”

    Furthermore, I do not want a bureaucrat telling my doctor how, when, and who he can or cannot treat. Yes, there are a lot of drawbacks to our current system, but at least now if you have a life-threatening illness, disease, or injury, you are seen almost always immediately. In socialized systems elsewhere like Canada and the UK, you are put on a waiting list (often longer than the duration of the fatal illness).

    The reason insurance is often out of reach for so many has more to do with liability insurance and frivolous lawsuits than it does with the fact that it is private. Medicaid and medicare provide horrendous coverage. We can and should come up with a better solution that does not stifle private ingenuity, but instead inspires it. The less government the better.

    • http://blurbomat.com/wordpress blurb

      You are misinformed:

      Read this report (it’s the big PDF in the sidebar of that linked page) and we’ll talk.

      UPDATE: on page 48 of that report, using 2003 numbers, $20 billion US in malpractice insurance is paid. That is a tiny contributor compared to administrative costs, drugs and other operational costs.

      Talking points aren’t going to advance the conversation.

    • peaseblossom

      I take issue with much of your comment, but in particular this paragraph:

      “Furthermore, I do not want a bureaucrat telling my doctor how, when, and who he can or cannot treat. Yes, there are a lot of drawbacks to our current system, but at least now if you have a life-threatening illness, disease, or injury, you are seen almost always immediately. In socialized systems elsewhere like Canada and the UK, you are put on a waiting list (often longer than the duration of the fatal illness).”

      If you currently use an HMO or some other form of managed care from a major insurance company, you ALREADY have a bureaucrat dictating to your doctor how, when, etc., and the insurance company can easily choose to drop you if you develop an expensive, life-threatening condition. I know. It happened to my uncle, who developed lung cancer, was dropped, and died in November 2007 leaving his wife in tremendous debt.

      As for the Canadian health care system’s supposedly interminable waits: this, too, is talking-point bullshit. I live in a have-not province (American ex-pat), meaning our health care system is worse than those in British Columbia or Quebec. My sister-in-law was diagnosed with breast cancer on Wednesday. On Monday, she sees a surgeon. Not bad, as waiting times go.

  • steve-o

    I completely agree that our health care system needs to be completely overhauled. But I’m definitely not in favor of a public system.

    Yes, I fall into the white male, lower middle income category, and my employer provides insurance, of which i still have to pay premiums. And I can admit that it is easier for me to say that it’s just to bad for others who don’t have insurance or can’t afford it. But, I have to say that the idea that the government would be the one to decide whether or not a procedure is available or not seems really sketchy.

    Our system is broken, and does need to be completely overhauled, but perhaps we need to look into why it’s so expensive. Health insurance companies have not been around for a long time and really only got off the ground in the 60s. Prior to that, everyone paid for each service only when needed. Even when health insurance was first beginning, it was only there for major events (surgeries, etc.) Everything else was still out of pocket.

    Perhaps finding a way to get back to something like that is more of what we should be looking for.

    No system will be perfect, and no matter what we do, someone will always end up being uncovered by any policy. But the needs of the many in this case do need to outweigh the needs of the few.

    According to the Census Bureau, only about 16% of Americans are without health coverage of some sort. That means, that for 84% of us (not just the white folks), we’ve got some protection. If it were reversed, I might be able to be convinced (constitution or not) that we’d need to consider a government sponsored solution. But right now, I can’t justify it.

    • http://blurbomat.com/wordpress blurb

      40 million + without coverage. Unacceptable for the size and economic power of the United States. A disgrace.

      • steve-o

        Not that wikipedia is an incredibly trustworthy source, but as i was looking at it this morning on the article relating to US health care, the true number of people who actually need it is less that that amount.

        via that article:

        “Among the uninsured population, nearly 37 million were employment-age adults (ages 18 to 64), and more than 27 million worked at least part time. About 38% of the uninsured live in households with incomes of $50,000 or more. According to the Census Bureau, nearly 36 million of the uninsured are legal U.S citizens. Another 9.7 million are non-citizens, but the Census Bureau does not distinguish in its estimate between legal non-citizens and illegal immigrants. It has been estimated that nearly one fifth of the uninsured population is able to afford insurance, almost one quarter is eligible for public coverage, and the remaining 56% need financial assistance (8.9% of all Americans)”

        link to it is: http://en.wikipedia.org/wiki/US_health_care_system#The_uninsured

        • http://blurbomat.com/wordpress blurb

          Read this report. Registration is required.

          From the same wikipedia page:

          “In 2007, 45.7 million people in the U.S. (15.3% of the population) were without health insurance for at least part of the year. This number was down slightly from the previous year, with nearly 3 million more people receiving government coverage and a slightly lower percentage covered under private plans than the year previous.[34]“

          Either way, the system in the US is a disgrace.

          In our family, we can afford insurance, but no company will insure us.

  • Danger

    Insurance companies are evil. And health care should not be tied to your job.

  • rspetersga

    What I don’t understand is why the automatic answer (from the right) is that a free-market will solve the problem. Get the government out, no regulations, and consumer demand will force companies to provide the services needed.

    The problem is that in a free-market system, the business’ first responsibility is to their stock-holders (as was mentioned in a previous comment) and not to their customers. I am forced to go to an insurance company for health coverage whose primary focus is NOT to provide health care coverage, but instead to maximize their profit by minimizing their payout (by denying services or even coverage).

    Where can I go to find someone whose first priority is my health?

  • http://satirereport.com Michaelpowers

    Whether or not you like the situation now, the fact is, if I had a broken leg, arm, life-threatening disease I would receive immediate treatment in this country. The same cannot be said for the UK, France, or Canada, (maybe they’d help in Cuba, but I’d have to bring my own bedding, water, food and antiseptic). While we could definitely incentivize those uninsured with a tax cut to give their more of their own money to buy the insurance plan they want, we still do have to remember that 83% of the United States does have health insurance and is pretty happy with it.

    • http://blurbomat.com/wordpress blurb

      Actually, your treatment speed in the US would depend on if you had insurance or not, how busy the urgent care or ER was at the time of your visit and if others were more in need than you. You would also pay more for the service you got and your insurance company would find ways to drop you if you kept having “life-threatening” diseases.

      When I lived in England, I had a storm window drop on both my thumbs. I tried to sleep through it, but the pain and pressure was horrible so the next morning I was driven to a medical facility where they got me right in and wrapped me up. I didn’t pay more than €1. Great service, kind and helpful and cheap.

      I also question how many of the 83% are “pretty happy” with their insurance.

      It’s time for a change.

  • http://www.digitalcatharis.com themightyjimbo

    speaking as someone with a good, employee subsidized ppo, someone who can choose his own doc, etc etc etc, i know that i spent nearly 2K out of pocket on my knees this year, with zero return on investment.

    zero. zip. zilch. my knees hurt just as much.

    i’m not so displeased with the result – i knew this was a risk.

    i’m displeased that i had to spend 2K to find that out.

    add to this what my company picked up (i’m a shareholder too you know) and the dramatic increase in my medical expenses over the course of my career, and as one of those 83%, i’m willing to go on record: NOT. HAPPY.

    healthcare is getting worse and needs fixing.