Among the many who were transfixed by the 2010 Vancouver Winter Olympics, I even took in the cheesy features celebrating Canadian culture.
Given the debate about health reform here in the states, there is some synergy in having the premier event focused on fitness spotlighted Canada, with their heralded single-payer health system.
The USA-Canada hockey game today, decided in sudden overtime after a literally last-minute goal in regulation time, was amazing. On Twitter, it was also a time for North American trash-talking.
Canadians made their evident pride show, not just about their hockey, but for their health system. An example: "I can't hear you over my free health care." Many American Twitterers were willing to take the Canadian health system, as either the victor's spoils or a consolation prize.
Congratulations to Canada on their win, and to the underdog U.S. team for winning silver and making it a thrilling game. There will be a rematch in four years, in 2014. Coincidentally, that's when the major health coverage expansions are scheduled to take place in the pending federal health reforms. It's a pretty different, uniquely American reform, but it does bring us closer to Canada in dramatically reducing the number of those who find themselves without coverage.
Hopefully, any 2014 rematch of this great Canada-USA hockey game won't feature jibes about our number of uninsured. Hopefully, that rematch will feature *both* countries with near-universal health care.
I just arrived back from Washington, DC, and I have a sober, realistic, and detailed sense that comprehensive health reform can pass in the next several weeks. It's not a forgone conclusion, but it's helpful. Now it's about vote-counting.
Representative Dennis Cardoza, Democrat of California, typifies the speaker’s challenge. The husband of a family practice doctor, he is intimately familiar with the failings of the American health care system. His wife “comes home every night,” he said, “angry and frustrated at insurance companies denying people coverage they have paid for.”
But as a member of the centrist Blue Dog Coalition, Mr. Cardoza is not convinced that Mr. Obama’s bill offers the right prescription. It lacks anti-abortion language he favors, and he does not think it goes far enough in cutting costs. So while he voted for the House version — “with serious reservations,” he said — he is now on the fence.
“I think we can do better,” Mr. Cardoza said of the president’s proposal.
We were proud that all of the California members of the House Democratic caucus supported the House health reform late last year. But there's a reason, given the particularly acute problems in California's health care system: Fewer employers offering coverage to their workers. Public programs facing budget cuts. And a broken individual market that has been spotlighted in the past few weeks for double digits rate increases and much more.
Nowhere is the health care crisis more severe in California than in the Central Valley, which would benefit most from the proposed reforms, such as the subsidies for low- and moderate-income families to afford health care.
Californians should be clear with our entire Congressional delegation about the desperate need for reform, and work to get every member to vote for the final health reform package.
Trying to stay informed on the progress of health care reform can be a tricky. Even a consumer of mainstream media must be saavy enough to figure out which talking heads or commentators are biased -- and then figure out how to block that bias.
That's the only way to really obtain a true picture of what transpired. And if you want, you can declare the winners and losers yourself -- if that's your game.
But if you're lacking the time to view a replay of the summit, and want a straight-forward analysis of what actually transpired -- beyond the talking points of each caucus and the obvious props of the Republicans --here's a good place to go: Paul Krugman's column in the New York Times.
Yesterday, President Obama's bipartisan health reform White House summit reinforced the need and urgency for health reform, to provide security and stability for those with coverage, and to provide affordable choices for those lack it. We had specific reports and reactions on the Health Access Twitter feed, at www.twitter.com/healthaccess.
The systemic health care problems in California came up repeatedly, showing the need for reform in general, and for stronger oversight and regulation of insurers in particular. This should not be a partisan issue: we were pleased to work with Governor Schwarzenegger on health reform in 2007, especially after we got key protections on affordability and other issues.
So we were disappointed yesterday when so many Republican leaders wanted to delay reform and start from scratch, rather than move ahead with the reforms that Californians desperately need.
We are also dismayed that legislators here in California are seeking to remove existing consumer protections, or repeal regulations even before they are passed.
Two specific efforts were spotlighted in the last 48 hours:
* One bill introduced yesterday would prohibit California from implementing the pending health reform--or any other health reform. It's clearly unconstitional. But on the day of a bipartisan summit to figure out areas of agreement, the amendment vividly portrays the GOP opposition to not just this reform, but any reform. The measure would prevent any regulation of the insurance industry--including preventing denials of coverage for pre-existing conditions.
* The major "reform" that Republicans pushed during the summit and through the year is the concept of selling health insurance across state lines. A California bill on the subject was defeated in committee earlier in the week.
Let's be clear: Allowing insurers across state lines would eviscerate all California consumer protections, allowing insurers from other states with much weaker regulations to sell substandard products.
If an insurer or HMO is licensed in another state and a consumer needs recourse, how would the consumer complain? By calling the insurance commissioner in another state? How would the consumer even know where to call? This measure effectively eliminates all enforcement against health insurers and HMOs.
California provides many consumer protections because of a long history of abuses by HMOs and health insurers. Other states provide few or none. Here's a list of the protections that Californians would likely lose by allowing plans licensed from out-of-state:
California Consumer Protections: Process/Financial
1. Fiscal Solvency Requirements (on Insurers, HMOs, medical groups, etc.) 2. Network Adequacy 3. Independent Medical Review 4. Grievance and Appeal Procedures, including urgent appeals 5. Right to Sue an HMO 6. Standards for Utilization Review 7. Reasonable person standard for emergency care 8. Right to a second opinion 9. Public disclosure of criteria for denial of care 10. Timely Access (48 hours for urgent care, doctor's visit within 10 days, etc) 11. Language Access 12. Continuity of care 13. Protection against balance billing for out of network emergency care 14. HMO Help Line: 24/7, 365 days a year
Which consumer protection should Californians go without? Grievance and appeals procedures? Right to a second opinion? Language access?
California Consumer Protections: Benefit Mandates (partial list)
1. Mental Health Parity (1999) 2. Contraceptive Coverage (1999) 3. Diabetes supplies (1999) 4. Prescription drugs: cover medically necessary drugs if drugs covered 5. Cancer screening: “all generally medically accepted cancer screening tests” 6. Drive-through labor and delivery 7. Same-day mastectomy 8. Prostate screening 9. Cleft palate 10. Pap smears 11. Mammograms 12. Well child care
Which benefit mandate should Californians go without? Mammograms? Well child care? Cleft palates? Diabetes supplies?
We wish those who support allowing out-of-state insurers to avoid these regulations would be explicit about what existing consumer protections they would like to effectively repeal. Their proposal would effectively eliminate all of them.
President Obama is hosting a bipartisan White House summit on health reform today, six hours long to be broadcast on C-SPAN.
Among the participants will be four key California leaders, all Democrats from the House of Representatives: Speaker Nancy Pelosi, Chairman Henry Waxman, Chairman George Miller, and Congressman Xavier Becerra.
Two California-specific notes about the Republican participation in this summit:
* State Senator Tony Strickland will be introducing a bill today to prohibit California from implementing the pending health reform--or any other health reform. It's clearly unconstitional. But on the day of a bipartisan summit to figure out areas of agreement, the amendment vividly portrays the GOP opposition to any reform, including any regulation of the insurance industry, including preventing denials of coverage for pre-existing conditions.
* The major reform that Republicans will push is the concept of selling health insurance across state lines. A California bill on the subject was defeated in committee yesterday. Let's be clear about what such a proposal would do: it would obviate all California consumer protections, allowing insurers from other states with much weaker regulations to sell substandard products.
Hopefully, there will be better ideas, and more willingness to move ahead on desperately-needed health reform, at the summit today.
Among the most compelling findings, according to the majority report (emphases added):
* "Internal company documents appear to call into question WellPoint’s assertion that increasing profits was not a factor in the proposed rate increase. On October 7, 2009, Cindy Miller, WellPoint’s Executive Vice President and Chief Actuary, received an e-mail from a senior corporate actuary, Barry Shane. In this e-mail, Mr. Shane wrote that a premium rate increase averaging 23% would “return CA to target profit of 7 percent (vs. 5 percent this year).” The actual rate increase sought by WellPoint averaged 25%.
* "Internal company documents appear to call into question WellPoint’s assertion that the 25% average rate increase is necessary... On October 24, 2009, Mr. Shane, the actuary, e-mailed Mr. Sassi, the head of WellPoint’s individual market division, that WellPoint executives needed to “reach agreement on a filing strategy quickly – specifically in the area of do we file with a cushion allowed for negotiations/margin expansion, or do we file at a lower level that maintains margin, but does not allow for negotiation.” It appears that WellPoint elected to file with “a cushion.” In an October 21, 2009, presentation to the WellPoint Board of Directors, Mr. Sassi identified the “Key Assumptions” in the pricing for the individual market in 2010. This slide differentiated the “2010 Rate Ask” from the “2010 Plan Rate Increase.” According to the slide, WellPoint’s “Rate Ask” would be 25% to 26%, while the “Rate Increase” the company assumed in its “2010 Plan” was just 20.4%.
* "Internal documents suggest that WellPoint’s business plan includes moving consumers into less generous plans. This strategy appears to have three components. First, WellPoint’s highest rate increases seem to apply to their most comprehensive insurance plans. Maternity care is a marker for a more comprehensive package of benefits. A chart of proposed rates shows that WellPoint’s highest rate increases apply to the only two product families regulated by the Department of Insurance with maternity coverage. The chart also shows that for the most part, WellPoint proposed lower increases within specific product lines for the versions with higher deductibles than for the versions with lower deductibles."
In response to questions from Congressional Representatives, Anthem Blue Cross executives offered little relief or explanation to California consumers for either their problematic practices or policy positions. The new documents begin and highlight some of the main unanswered questions: Why are the hikes so much larger than the rate of medical inflation? Are they targeting the increases to certain products or people?
And why are they opposing the health reforms that address their stated reasons for the rate hikes?
Angela Braly, the CEO of Wellpoint, the parent company of Anthem Blue Cross, used her answers to offer her critique of health reform. But the testimony of Anthem Blue Cross confirms the need for health reforms and greater insurer oversight, at both the state and federal level. Health reform would provide help so people would not lose coverage when they lose income, and provide subsidies so premiums never go over a certain percentage of income. The reform would not just help people with direct help, but keep healthy people covered and in the pool, preventing the adverse selection that Anthem decries.
Not to Anthem or Wellpoint's liking, health reform would also provide new rules to ensure that insurers justify large increases and reject those without reason. Insurers should not be allowed to unilaterally raise rates without a reason, or to target rate increases for specific people or products.
Let's not forget that they opposed not just the current federal reforms, but also was aggressive against state reform here in California. It was their practices and policies a few years ago that we described in this video from http://www.sickofbluecross.com/:
Back the California Legislature, a collective sigh of relief wafted from around the Capitol this week as the Assembly and Senate wrapped up their work on mid-year budget cuts.
Meeting the deadline for the eighth special session set by Gov. Schwarzenegger -- yes, that was eight in one year -- Assembly members and state senators advanced a range of "budget solutions."
For now, they avoided the uproar that followed the Legislature's acquiescence to Schwarzenegger's harsh budget cuts last year on health and human services programs. Many advocates, commentators and members of the public pointed out that those were exactly the kinds of programs California families need to survive this punishing recession. The Senate and Assembly appropriately delayed discussion of the proposed health and human services cuts and eliminations until June, after the governor's May revision of his proposed budget is released.
Let's hope that come June, their wisdom holds.
For a brief but detailed overview of the mid-year budget cuts that did pass, see the California Budget Project's analysis at http://www.cbp.org/
WellPoint says the rate increases are a result of medical inflation and healthier policyholders dropping coverage. But the thousands of pages of WellPoint documents we have reviewed tell another story.
They tell a story not about costs, but about profits … not about increasing coverage, but about reducing benefits to policyholders … not about removing barriers to coverage, but about erecting new ones … not about covering more people who have illnesses, but about cutting them off and seeking out new customers who are healthier and wealthier.
The documents also tell a story of potential huge, new premium rate increases still to come.
* WellPoint says that its rate increases have nothing to do with increasing company profits. But an internal company e-mail says that its rate increase would “return CA to target profit of 7 percent.”
* WellPoint says that its rate increases are absolutely necessary. But its internal company documents describe a plan to build in “a cushion” to “allow for negotiations.” The company told its board of directors that its average “rate ask” would be 25%, but that its final “rate increase” would be only 20%.
* Other documents raise the possibility that WellPoint may have manipulated its actuarial assumptions to keep its medical loss ratio, a key measure reviewed by California regulators, “flat.”
* The documents we have reviewed show WellPoint is proposing its highest increases on its more generous plans. At the same time, it is actively developing new products, called “downgrade options,” that reduce benefits for its policyholders.
As we will hear from the witnesses on our first panel, this “purging” process cuts coverage for WellPoint policyholders when they need it most: when they get sick.
And the WellPoint documents point to a future of even higher rate increases. WellPoint told Committee staff that WellPoint voluntarily capped its maximum rate increases at 39%. If WellPoint had not done this, some policyholders could have faced rate increases of over 200%.
One question we asked is where does all of this money go. We have learned that in 2008, WellPoint paid 39 senior executives over $1 million each. And the company spent tens of millions of dollars more on expensive corporate retreats. During 2007 and 2008, WellPoint spent $27 million on 103 executive retreats. One retreat in Scottsdale, Arizona cost over $3 million...
Ultimately, what this hearing will show is that the current system is absolutely unsustainable. If we fail to pass health reform, insurance rates will skyrocket and health insurance will become so expensive only the most healthy and the most wealthy will be able to afford coverage.
We may be getting closer to the tipping point toward rate regulation of health insurance policies -- or so it seemed during Tuesday's Assembly Health Committee hearing on the steep premium hikes planned by Anthem Blue Cross.
Chair Dave Jones (D) led committee members in an informational inquiry into the "astonishing and troubling" plan for Anthem Blue Cross customers to pay up to 39% more (and in some cases, even more than that) for individual health insurance plans in just 60 days' time.
Originally, the corporation had notified customers that their monthly bills would jump in less than 30 days, but Anthem Blue Cross agreed to postpone the hike to allow time for elected representatives to question executives. The company still intends to impose the increases.
WellPoint Chief Executive Angela Braly is scheduled to appear before the subcommittee only a day before President Obama is to bring Democratic and Republican leaders together for what the president hopes will be a fruitful summit on national health care reform. The president's own proposed plan included rate regulation -- and he, on numerous occasions has cited the Anthem increased costs in California as evidence of the need for health care reform.
California has long given health insurance companies a great deal of latitude in operating in the individual market. Anthem Blue Cross executives on Tuesday told the Assembly Health Committee that state Insurance Commissioner Steve Poizner had no issues or questions about the now-controversial 2010 rate increases when Anthem reported its intent to the Department of Insurance last November.
But Anthem executives got a tongue-lashing on Tuesday by California assembly members.
Declaring the rate increase a hardship on California families at a time of economic peril and joblessness, Jones emphatically asked Anthem President Leslie Margolin and Vice President James Oatman: "Have you no shame?"
"The question is disappointing to me," Margolin replied, and then offered to work with legislators to help drive down costs, particularly those resulting from mistakes by hospitals and doctors.
Jones refused to take the offer seriously. "This is from a company that fought tooth and nail in 2007 when Gov. Schwarzenegger was pursuing health reform for exactly the reasons that bring you here," Jones said. "The record leaves me considerably doubtful of what the motives are."
Oatman testified that Anthem Blue Cross had calculated that, with the costly premiums, it would lose 250,000 of its 800,000 individual policy holders in 2010. It also anticipates picking up 250,000 new customers by going after a younger, healthier demographic. Anthem's share of the individual policy market in California has been growing and it is now the largest in the state.
Oatman said "utilization" by existing customers had gone up in 2009, leading consumer advocates such as Beth Capell of Health Access California to charge that the steep premium increases may be a tool for the practice of "churning" older, more care-seeking customers out by burdening them with unsustainable cost increases.
"Anthem Blue Cross is emblematic of the broken health care system we have," Capell said, noting that, since 2007, Health Access has been collecting consumer stories and complaints at sickofbluecross.com. "They deliberately churn, they aim for higher cost-sharing, skinny benefits and ... ultimately contribute to bankruptcies."
Oatman downplayed the hardship on households by characterizing the individual market as a temporary stop for people between jobs -- or, "a residual transitioning marketplace."
Assemblymember Mary Salas (D) said, "There's going to come a time when no one will be able to afford your product. This makes it very, very clear to me that we have to have national health care reform."
The executives fielded some rapid-fire questions about Anthem Blue Cross' profits, and how much money it sends out of state to the parent corporation, WellPoint Inc. in Indiana. They refused to disclose the salary ranges of top executives, saying the information was private, and they were fuzzy on numbers sought by Assemblyman Hector De La Torre (D): amounts spent in 2009 on marketing, lobbying, penalties for wrongfully denying claims, staff to investigate consumer records in order to rescind policies, and so on.
Unfortunately for company executives, the hearing occurred on the same day as the Los Angeles Times published an analysis of the company's regulatory filings that showed that $525 million in Anthem Blue Cross earnings last year were shipped back to Wellpoint. The article supplied many other damning figures to lawmakers, such as the stunning amounts transferred to Blue Cross affiliates in other states.
When the two entities merged in 2004, California leaders worried that the out-of-state, for-profit WellPoint would suck profits from California rather than invest in providing the health care coverage consumers thought they were buying.
WellPoint has 8 million customers signed up with Anthem Blue Cross in California, which is WellPoint's most profitable entity nationwide. It operates in 14 states.
As my colleagues witnessed the Assembly Health Committee hearing on the Anthem Blue Cross rate hikes, and prepare for the Congressional hearings in DC (where I am this week), it's good to remember that this isn't the first time that Anthem Blue Cross has been in the spotlight.
As we note on the website www.sickofbluecross.com, they happen to sell the only insurance product worthy of mockery in an entire segment of The Daily Show, back in 2005.
Targeted to 19- to 29-year olds, Tonik was a prime example of how Anthem Blue Cross of California has been aggressive in its business model to collect premiums from young and healthy people and avoid people who actually may need care.
[Small note: beyond its mockery of Anthem Blue Cross, the segment has perhaps the best health policy chart I have seen, accurately explaining the reasons young people may not have coverage. Despite the notion of "young invincibles," the chart shows that few of the uninsured are "too extreme" and that the main reasons are that many young people are "too poor" or "too sick." Appropriately, health reform would resolve that by preventing denials for pre-existing conditions, and providing subsidies so coverage is not more than a percentage of income.]
There's a lot going on, from the President releasing a new health reform proposa, to the investigations on Anthem Blue Cross, to the state budget, to the action at adminstrative agencies like the Department of Managed Health Care and the Board of Pharmacy.
Here's a quick snippet of some must-read links:
* The President announced his compromise health plan today. Here's the link to the plan. More analysis to come.
* An LA Times article by Shane Goldmacher about the Governor making last minute appointments to the Board of Pharmacy to help gut drug labeling regulations.
* More on the bad behavior of Anthem Blue Cross of California: * Duke Helfand at the LA Times on Commissioner Poizner finding over 700 violations by Anthem Blue Cross. * Lisa Girion at the LA Times reports that Anthem Blue Cross of California has provided more than $4.2 billion in profit to its parent, Wellpoint.
According to various sources, President Obama is slated to post a compromise version of a comprehensive health reform on the White House web site today at 10am East Coast time--7am Pacific.
The big news so far is that the President's package includes a stronger rate regulation component--a response to the Anthem Blue Cross of California rate hike that he has put such a spotlight on in the last week. (Here's the Los Angeles Times story. The New Republic's The Treatment has some analysis, including by yours truly.)
The President is basically adopting a proposal by Senator Dianne Feinstein for a rate authority that would not just review rates, but have the ability to reject them if they were excessive or unjustified.
Both Senator Boxer and Senator Feinstein were working on language for stronger rate regulation well before the Anthem Blue Cross rate hikes came to light, because this isn't a new issue either in California or the country as a whole.
In our state and most of the United States right now, insurers can unilaterally raise rates without justification--especially for individual families and small businesses with little market power. The pending health reform bills already would have provided indirect relief, from the group purchasing power of the exchanges, to the requirement that insurers needed to justify their rates--that by itself was more than what California has now.
So the health reform has several components that can slow the growth in health premiums, but rate authority provides the opportunity for intervention, to ensure that ratepayers actually see the savings.
As part of a larger reform that provides guaranteed issue, community rating and risk adjustment, rate review and regulation would not just check against unwarranted rate hikes, but such increases being used to target certain products or people.
As we know, Assemblyman Dave Jones has attempted to advance a rate regulation bill at the state level, but face a heavy opposition campaign.
Suddenly, whether at the state or federal level, the political prospects for this issue has markedly improved from a mere month ago.
It’s been likened to inviting electrocution by waving around a five iron on a golf course during a lightning storm.
Anthem Blue Cross’ revelation of plans to hike rates by up to 39% (and as we have found out, more) has caused quite the stir. It has galvanized a range of influential elected officials, who followed President Obama in pointing to the example Anthem is setting as evidence that substantial health care reform is needed.
Next week promises the potential of fireworks, as Anthem Blue Cross officials face the scrutiny of questioning from California Assemblyman Dave Jones (D), chair of the Assembly Health Committee; actuaries representing California Insurance Commissioner and gubernatorial candidate Steve Poisner; Congressmen Henry Waxman, Bart Stupak and other members of the Energy and Commerce Subcommittee on Oversight and Investigations.
Adding fuel to what the Wall Street Journal called “an (escalating) firestorm between the Obama administration and health insurers” U.S. Health and Human Services Secretary Kathleen Sebelius released a paper examining double-digit increases or proposed increases in six states.
The report, transparently titled "Insurance Companies Prosper, Families Suffer" contains strong material to support the resurrection of health reform legislation, which next week will be the focus of a bipartisan meeting called by President Obama.
The point of the report is that the problem isn't just one company, or one state. Here’s an excerpt:
Recent economic data show that profits for the ten largest insurance companies increased 250 percent between 2000 and 2009, ten times faster than inflation.12,13 Last year, as working families struggled with rising health care costs and a recession, the five largest health insurance companies – WellPoint, UnitedHealth Group, Cigna, Aetna, and Humana – took in combined profits of $12.2 billion, up 56 percent over 2008.14 These health insurance companies’ profits grew even as nominal GDP decreased by 1 percent over this same time period.15 WellPoint accumulated more than $2.7 billion in profits in the most recent quarter alone.
Two upcoming conferences of note for advocates for health and human services:
The California Working Families Policy Summit 2010, on February 25th, will feature Keynote Speaker Secretary of Labor Hilda L. Solis, a former California Congresswoman and state legislator. It will also include a taped message from First Lady Michelle Obama.
It is free, although there is a charge for the luncheon. You can register for the conference online at http://www.ccrwf.org/ or download the agenda and mailing or faxing it with payment if it applies. The early registration deadline is Friday, February 19 and registration closes on Friday, February 22.
The California Budget Project 2010 Conference, "The 3 Rs: Recession, Recovery, Reform: What's in Store for California?" on March 25th, features the health policy-obsessed Washington Post reporter, commentator and blogger Ezra Klein, a native Californian.
Sign up by February 20 to attend CBP's one-day public policy conference at the early bird price of $90. Sign up online or by faxing or mailing the form in our conference brochure.
While we have presented at past versions of these conferences, we aren't this year, but we encourage your attendance regardless... We are simply posting these because they provide good, solid information, and they are are worth your time.
New accountability for so-called discount health plans: Key hearing in Oakland on Monday!
Thursday, February 18, 2010
HEALTH ACCESS UPDATE Friday, February 19, 2010
DMHC PROPOSES REGULATION ON SO-CALLED "DISCOUNT HEALTH PLANS" * CA Department of Managed Health Care cracks down on wild west of unlicensed products * Discount health plans are not health insurance, but some pay premiums thinking they are. * Many provide less benefit than a pizza coupon: illusory discounts with phantom providers * Health Access argues in favor of real discounts, real networks, and real notices
* DMHC HEARING on new consumer protections: MONDAY, February 22nd, in Oakland
* Other Items: Updates on Federal Health Reform, Anthem Blue Cross rate hikes, State Budget Issues, and much more on our Health Access Blog. * Join Us on Facebook! Follow Us on Twitter!
The California Department of Managed Health Care has now embarked on the formal process to regulate so-called "discount health plans." This will begin with a public hearing at the Elihu Harris State Building, 1515 Clay Street in Oakland at 11:30 am on Monday, February 22, 2010 and it is expected that industry representatives, advocates, and consumers will all give testimony on this regulation. The specific language can be seen at DMHC’s website at http://www.dmhc.ca.gov/. Interested persons or organizations may also submit written comments to the Department on their website by 5:00 pm on Monday, February 22.
The Department has reacted to many industry abuses where so-called discount health plans marketed a discount health card as real, comprehensive health insurance—which it is not. Some of the documented abuses are:
* Consumers are charged high fees and co-payments by discount health plans ($25 to over $1000 per month) which are of questionable value for that money
* Discount health plans advertise what turns out to be a phantom network of doctors, hospitals, and clinics that allegedly offer discounts to cardholders. However, these providers often are unaware they are part of discount health network and are reluctant to provide services.
* Consumers pay a monthly premium for a discount health card that is billed as a dollar deduction or “percentage off”—but is often no more than or even as great as other discounts commonly given to consumers for free, such as AAA, religious groups, or fraternal organizations.
* In most cases in health care, the value of the discount is illusory because there's no set price of the service to begin with. Many "billed charges" for doctor and hospital care are multiple times what insurers and government programs pay, so a discount off that "sticker price" is still inflated.
* However, the most insidious impact on these consumers is that they believe they have purchased true health insurance that provides some peace of mind; however, they find they are spending good money for a largely worthless product.
DMHC has undertaken to put discount health plans through a rigorous licensing process to establish requirements and test screening and oversight guidelines to separate what may be legitimate businesses from outright fraud artists. They have, for example, · Prohibited from marketing as health insurance · Required the discount health plan to maintain a public website with a complete and accurate directory of all providers by specialty and geographic location · Required plans to provide a toll-free customer assistance call center number and disclose availability of interpretation services for languages other than English where calls must be answered within 5 minutes · Required to offer bona fide discounts tied to the established Medicare fee schedule
Health Access has previously supplied significant policy guidance to the Department in drafting the language of this regulation. Consequently, with some changes, consumer advocates generally support the language in this version of the regulation.
Health Access and many of consumer allies will be present at the upcoming public hearing to support the Department’s strong language to rein in the most egregious abuses in this industry. ORGANIZATIONS AND INDIVIDUALS ARE INVITED TO JOIN US IN SUPPORT OF THE REGULATIONS AT THE MONDAY FEB 22nd OAKLAND HEARING.
If you have questions, or need further information, please contact Elizabeth Abbott at Health Access at (916) 497-0923 or via email at eabbott@health-access.org.
U.S. Department of Health and Human Services (HHS) Secretary Kathleen Sebelius announced that states are able to claim enhanced funds for Medicare Part D drug payments. This should allow California to get $680 million additional money from the federal government.
This decision could mean an additional $160 million more if the enhanced Medicaid match--which the states get through December 2010 due to the American Recovery and Reinvestment Act--is extended by Congress for an extra six months. The House has passed such an extension in both its health reform bill and its jobs bill as well.
After some unfair and harsh statements, Governor Schwarzenegger struck an appreciative tone: “Today’s announcement shows that our bipartisan efforts for a more fair and equitable relationship with the federal government are paying off. Together, state legislative leaders and our Congressional delegation, especially Senators Feinstein and Boxer, have been working to bring California more of the federal dollars we are owed. These funds are important, and while we still have more work to do, I appreciate the commitment of the Obama Administration in responding to our requests for these much-needed funds that are owed to our state.”
This doesn't solve our state budget crisis, but it certainly helps.
Some back story on the Anthem Blue Cross rate hike story...
From little acorns, mighty oaks grow.
We here at Health Access California do lots of things—we work on bills and regulations, we organize rallies and write blog posts, we send out media releases and talk to reporters, we write policy papers and even have staff meetings. We have a twenty-year record of accomplishment and we keep trying to plant seeds for the future.
2005 was a pretty dark year. The year before, we had just barely lost a major health reform ballot fight. The drug companies were spending $80 million to defeat another ballot initiative we sponsored to give low income uninsured real discounts on drugs. If we had a policy idea, we had few hopes the Governor would sign it. The state budget was not pretty. And there were little chance that anything happy for consumers would happen at the federal level.
But even in what seem dark times we do our job, working on consumer protections big and small.
One of the modest victories we had that year was a bill dealing with the individual insurance market, AB356 authored Assemblymember Wilma Chan, chair of Assembly Health and our champion on hospital charging. We remembered AB356 because it provided a very clear warning to consumers who consider declining their employer coverage or COBRA:
"Please examine your options carefully before declining this coverage. You should be aware that companies selling individual health insurance typically require a review of your medical history that could result in a higher premium or you could be denied coverage entirely."
(This is true and horrible but lots of real folks have no idea that the real world of health insurance could be that awful. Maybe more do now, given the attention to health reform, but the horrors of the individual market are not widely known for fokls who haven't been through the issues.)
One of a handful of modest protections enacted in AB356 was a requirement that HMOs and insurers give consumers 30 days notice before increasing their premiums, including the reasons for the increase.
We did not imagine that such notices would yield press coverage, and one day the President of the United States would be highlighting with outrage at the premium increases levied by a health insurer on individual consumers in California—which he knows about and we know about because consumers are now given notice of premium increases as well as the reason offered by the insurer or HMO for the increase.
We just thought it was wrong that insurers could increase premiums for individuals with no notice at all.
We are also mindful that in many other states, consumers still do not get 30 days notice—consumers probably just get a bill with a higher premium with no notice whatsoever and no explanation.
We are looking forward to next week---when Anthem Blue Cross has now cancelled its investor meeting to participate in the hearing by the House Energy and Commerce Committee---and the hearing by the Assembly Health Committee day before on these increases. It should be an enlightening week.
But it shows that sometimes these small bills for sunshine and disclosure can make a difference. All from the very modest requirement that individual consumers be given 30 days notice before their premiums skyrocket.
And did we mention that we think what Anthem Blue Cross is doing is wrong? There is that, too.
Hundreds of Californians joined health care advocates, doctors, small business owners, civil rights and faith leaders armed with banners and signs to share their stories of health insurance industry abuses and to call upon Members of Congress to deliver on the promise of change by finishing comprehensive health care reform now and finishing it right.
Outside the offices of Anthem Blue Cross in downtown Los Angeles, over 250 people gathered at all four corners, with Korean drummers and "Honk of Health Reform" signs, to rally public support. Many shares their own stories as consumers – many of whom will be impacted by Anthem Blue Cross’ announced premium increases of up to 39%. "Over the last 38 months Anthem Blue Cross of California has already increased my premiums six times for a total increase of 117%,” said participant Steven Dornbusch. “I am one of those ‘privately insured’ California residents threatened with another whopping 36-39% increase. How can I afford to have my insurance premium triple over 4 years? I need opportunities and choices to purchase affordable coverage through a public option."
In San Francisco, over 200 rallied and signed giant letters to California's Senators, calling on Senators Feinstein and Boxer to be vocal leaders in the Senate by listing the many reasons California cannot afford the status quo and laid out a clear path to winning reform by passing a budget reconciliation bill to fix the shortcomings in the Senate Bill via a simple majority vote.
“Enough is enough. We voted for change, and we want results,” said State Campaign Director Patrick Romano of Health Care for America Now. “Congress has been debating health care reform for more than a year now. Meanwhile, as evidenced by Anthem Blue Cross’ recent rate hikes, everyday people are still at the mercy of insurance companies. Californians today are more likely to be uninsured, face a higher cost-of-living, are at greater risk to be denied coverage for pre-existing conditions, and less likely to be offered on-the-job coverage. Health reform would benefit Californian by providing new choices for the uninsured, more security for the underinsured, much needed stability to our safety net, and real savings for our state budget.”
Wednesday’s rallies – part of a week-long nationwide push in 32 states – also served as a kick-off to a “40 Days to the Finish Line” campaign throughout the state. In the 40 days leading up to Congressional Easter Break, Health Access California and Health Care for America Now in California will be urging Members of Congress to get a final bill passed by the Spring recess by having thousands of concerned Californians participate in daily actions and events to show their support for passing health insurance reform now.
“We need real solutions to our health care crisis, and we need them now,” Patrick Romano said. “In poll after poll, overwhelmingly Americans support health care reform. What we are conveying to our elected representatives is that there is a clear path forward and we are committed to seeing health reform get to the finish line – but we are also calling upon them to lead the way.”
The wrong prescription at the Board of Pharmacy...
In a major disappointment, the California Board of Pharmacy today passed watered-down regulations, rolling back an effort by consumers and community of color groups to make prescription drug labels more understandable.
Issues include the minimum size of the text (10 point vs. 12 point) for easy-reading by seniors, and a requirement of instructions written in the patient's appropriate language, for California’s diverse populations that may not read English.
The new rules effectively gut the bill, SB472(Corbett), only requiring a 10 point font. Oral interpretation would be provided only if available, and their was no requirement for translations.
This is not just a consumer convenience, but could have medical and health outcomes, to make sure people take their medications with the right dosages.
Consumer advocacy groups like the California Pan-Ethnic Health Network (CPEHN) and the California Alliance of Retired Americans (CARA) will continue to work on this issue, as will Senator Corbett. More information to follow.
We're hearing from a lot of unhappy Anthem Blue Cross customers this week -- there are many, many customers out there who are fed up, to say the least, with the insurer's planned rate hike of up to 39%. Even if the corporation did agree to put it off for a couple of months.
Many of these Californians have also long been dissatisfied with the service provided by Anthem Blue Cross, which seems to play hide-and-seek when it comes time for them to pay up.
The game goes like this: In order to get reimbursement for policyholders' medical expenses, the customers have to seek it out. And seek. And seek. Many aggravating hours and phone calls and faxes later -- and only then -- does Anthem hold up its end of the bargain.
One woman who needed shoulder surgery did her homework in advance, and called Anthem Blue Cross to make certain the procedure would be covered. Yes, it would, she was assured. One surgery later and Anthem said, oops, your share of the bill is $100,000.
A stressful game of hide-and-seek later, and Anthem changed its tune: The insurer agreed to pick up all but $8,000 of the surgery patient's bill.
Another Anthem Blue Cross customer who runs a small business with her husband got hit with a 35% increase -- after double-digit increases in years prior -- and protested by saying she would shop around for a more consumer-friendly insurance company. Lo and behold, Anthem came back with a better offer: a very modest increase.
This game is unfair and simply bad business. So, of course, is notifying folks that, in this economy, they would be hit with a 39% increase -- much higher than inflation and the rise in medical costs.
Unfortunately for Anthem Blue Cross, one of their newly, truly unhappy customers is a well-known radio commentator and former White House cabinet member who is now a professor at UC Berkeley. Now he says he's shopping around.
Join other Californians TODAY, WEDNESDAY, FEBRUARY 17th, to urge our California Congressional delegation to finish the job on health reform, kicking off a final push of 40 days of action.
From the rate hikes of Anthem Blue Cross of California, to growing number of uninsured and proposed budget cuts, California is central in this national debate, showing that the status quo is not an option.
Today, California residents and advocates for health reform, including Health Access California, Organizing for America, and Health Care for America Now (HCAN) – the nation’s largest health care campaign - will come together in Los Angeles, Modesto, and San Francisco, to send a strong message to Congress that it’s time to deliver on the promise to reform our broken health care system by finishing comprehensive health care reform now and finishing it right.
Wednesday’s rallies will serve to kick-off a “40 Days to the Finish Line” campaign throughout the state demanding Congress act now on health care reform and listen to everyday Californians, not the insurance lobbyists who are spending millions to block health care reform and protect their profits – while at the same time raising rates up to 39%.
In the 40 days leading up to Congressional Easter Break, Health Care for America Now will be urging Congressional Members and Senators Dianne Feinstein and Barbara Boxer to get a bill passed by the Spring recess. Thousands of concerned Californians will participate in daily actions and events over 40 days to show their support for health insurance reform now – sending a strong message to Members of Congress that the majority of Americans still support comprehensive health reform.
JOIN US IN LOS ANGELES: WHERE: Anthem Blue Cross Building, 801 S. Figueroa St., Los Angeles 90017 WHEN: Wednesday, February 17th at 12 NOON
JOIN US IN SAN FRANCISCO: WHERE: Justin Herman Plaza, San Francisco 94110 WHEN: Wednesday, February 17th at 5 PM
WHO YOU ARE JOINING: Health Care for America Now, Health Access, California Partnership, Organizing for America, MoveOn, California Labor Federation, LA County Labor Federation, AFSCME, SEIU, Committee of Interns and Residents, National Physicians Alliance, Coalition of Orange County Community Clinics, Korean Resource Center, ACLU-Southern California, CLUE, Unitarian Universalist Legislative Ministry, PICO, Clinica Romero, Venice for Change, and Alliance of Californians for Community Empowerment.
There are five ways the Anthem Blue Cross rate hike could have been prevented by the health reforms now pending in Congress: 1) Overall cost containment efforts 2) Rate review 3) The group purchasing power of the exchange 4) Subsidies so people don't lose coverage when they lose income 5) Keeping people covered and in the insurance pool to prevent adverse selection
As we followed on Twitter today, Anthem Blue Cross agreed to delay their controversial and large rate increases in the California individual market for two months, from March 1st to May 1, 2010.
This was in response to California Insurance Commissioner Steve Poizner, who asked for the delay to allow time for an outside actuary to review Anthem Blue Cross' rates.
Anthem remains defiant and unapologetic about the rate increase, and says the rates will ultimately be approved.
They may be right. As pointed out in Marc Lifsher in the Los Angeles Times, the only real authority the Commissioner has is on an related issue, which is whether Anthem Blue Cross was abiding by a 70% "medical loss ratio" requirement--whether 70% of premium dollars were going to patient care, rather than administration and profit. (That requirement was increased from 50% to 70% by former Insurance Commissioner John Garamendi in his last year before becoming Lt. Governor. Federal health reform would increase that requirement to around 85%.)
If nothing else, the delay provides two months of rate relief for many California consumers. Hopefully, the inquiry and attention will provide more information about how Wellpoint and Anthem Blue Cross determines their rates. As the blogger Karoli has noted, increases by Anthem Blue Cross at this level are not uncommon--what is new is that the rates are spotlighting the need for reform, showing their need to be stronger oversight on insurers at exactly the time we are debating what rules they should be under.
But even today's events just reinforce the need for health reform--both the federal health reform bills, and state legislation to put in place more insurance oversight and rate review. Anthem Blue Cross' behavior continues to be the clearest case for why such reforms are needed (more is available at http://www.sickofbluecross.com/).
Here's the statement from Anthem Blue Cross executive Brian A. Sassi:
“Earlier today, Anthem Blue Cross agreed to a request by the California Department of Insurance to postpone a rate adjustment for individual members in California by two months to allow the Department additional time for review. To avoid confusion for our members, this delay will impact all Anthem individual members regulated at either the state Department of Insurance or the Department of Managed Health Care. We welcome the regulatory review and are confident that our rates reflect anticipated medical costs.
“Anthem filed these rates with the appropriate regulators in November of 2009. They are actuarially sound and in full compliance with all requirements in the law. The rate adjustments have been reviewed by an independent expert.
“Our decision to agree to postpone the rate adjustment does not change the underlying issue. All health plans are in the same situation in trying to deal with the steadily increasing medical costs in the delivery system, which are not sustainable. We are also experiencing a higher proportion of healthy individuals choosing not to enroll, leaving an insured pool that utilizes significantly more services. We need to refocus the health care reform debate toward steps that will improve quality and control the underlying medical costs, which is driving the high cost of coverage.
“We understand the impact any rate adjustment has on our members and their ability to continue to carry health insurance. And we are committed to driving quality and reducing costs in the health care system and improving the lives of the Californians we serve and the health of communities all across the state. Members will be receiving a letter shortly that describes these changes in detail and whom to contact for additional information.”
Anthem makes the point that this is a "re-review" of rates filed in November 2009. But that only points out that we need more aggressive rate review to start with, like the legislation that Assemblyman Dave Jones and others have advanced in the legislature in recent years.
Anthem also continues to make the two-point justification of their rates, that it reflects medical costs the impacts from the economy. It's not clear that's the whole story. Medical inflation has only been around 9% this year, nowhere near there 25-39% increases.
And while it may be true that people are dropping coverage, leaving a smaller--and typically sicker--pool to cover, that's something that would be addressed by health reform. After all, health reform would provide subsidies so premiums would not go above a percentage of a family's income; so if you lost a job or income, you wouldn't lose coverage. That not only helps the family, but prevents the adverse selection that leads to higher premiums.
Even if the rate increase is ultimately approved, the next two months can be useful in getting a better and deeper understanding of the issues involved, and what new rules need to be put in place, especially in the individual insurance market.
Assemblymembers on Guv's budget: "Not the wisest thing"
Friday, February 12, 2010
Gov. Arnold Schwarzenegger’s self-described “draconian” budget proposals began sounding a little less inevitable by the end of Thursday’s lengthy Assembly Budget Subcommittee hearing at the Capitol.
A strong showing of citizen-advocates opposed many of the cuts, emphasizing the benefits of threatened health programs ranging from one that provides infected jail inmates with HIV and AIDS drugs to the widely accessed Adult Day Health Care program.
Members of the subcommittee chaired by Assemblyman Jerry Hill (D) noted that if the governor’s proposals were to be adopted, the costs for alternatives would be higher in the long run.
Cases in point: * The Office of AIDS program buying discounted HIV-AIDS drugs for county jail inmates prevents costly and hazardous outbreaks of disease. The governor would cut the entire $9.5 million portion of the program for counties – and then would also transfer more prison inmates to county jails, which cannot afford the drugs.
* The governor would eliminate vision coverage for kids whose families buy discounted health insurance through the Healthy Families SCHIP program. Lawmakers noted that this move would cost the state uncounted federal dollars by preventing better classroom performance by children who need glasses.
* A proposal to eliminate Adult Day Health Care drew one of the largest crowds of opponents, who testified that the option of long-term housing was unaffordable. Another option, for household members to quit their jobs to care for the participants 24-7 would cost California productive workers and income taxes.
* Administration spokesmen argued that Family Planning Services funded by a 9-to-1 federal match needed to be eliminated because “coming up with 10-cents on the dollar in this environment” was difficult. Legislators questioned that assessment, and suggested the Administration go find even more programs with a $9 federal match for every $1 spent by the state.
Assemblyman Jim Beall Jr. (D) noted that moving ahead with health program cuts would be short-sighted because of the likelihood of federal health reform creating opportunities to restructure delivery of health care in California.
In particular, Beall said, new federal rules about mental health care getting parity with physical health care should pave innovative paths for blending delivery of care.
The final segment of the 6-hour hearing, interrupted by the second Assembly floor vote on Sen. Abel Maldonado’s nomination for lieutenant governor, was dedicated to the last item on the agenda: a proposed shift of at least $1 billion from Proposition 63 Mental Health Services Act dollars to the general fund.
The item brought out perhaps the largest turnout of the day, with advocates from Long Beach to Sonoma lining up to tell stories of how the MHSA saved money, and lives. After a Sacramento woman tallied the cost – over $2 million -- of her mentally ill mother’s numerous hospitalizations, she made the point that early intervention through MHSA-style programs would have led to far less costly, and tragic, outcomes.
Of the proposal to shift MHSA dollars to the general fund, Assemblyman Wesley Chesbro (D) said “The impact of this will be severe if it’s allowed to go forward.”
Following the entire presentation, Hill said, “We fully understand the governor’s request,” regarding the mental health funds. “This is probably not the wisest thing to do.”
The Daily Show with Jon Stewart picks up the meme, with correspodent John Oliver using the Republican National Committee's winter meeting in Hawaii as the hook. It's worth watching.
Below is an account from Nellie Price, a colleague of ours at Health Access, perhaps showing that advocacy runs in the family:
On Tuesday evening, my Aunt called me to let me know she and my Uncle would be in Sacramento the next day visiting with legislative offices and testifying before a committee regarding Adult Day Health Care (ADHC).
My Aunt and Uncle live in Chico, where I grew up. They, along with numerous other members of my family, were born in Chico and have lived there for their entire lives. My Aunt’s sister, who is 70 years old, is schizophrenic, diabetic and an amputee. She lives in Butte County and travels 40 miles Monday through Friday to attend the Peg Taylor ADHC Center. At the center, she is able to receive blood sugar and blood pressure monitoring, care for her amputee stump, monitoring of her diet and her medications.
Just recently, she fell and fractured her left humeral head. After a month at a convalescent hospital, she was released and given physical therapy. The Peg Taylor Center was able to provide the care for her and she currently has full range of motion.
My Aunt and Uncle have both recently retired, and My Aunt’s sister is able to be part of the community and an active part of family activities. But I wonder about people who don’t have these “simple” luxuries. And families who aren’t able to take time to advocate for other family members.
I attended the Assembly Budget Subcommittee on Health and Human Services today with my Aunt and Uncle. It seemed as if the majority of the room was there to testify on behalf of ADHC. The committee had to interrupt the testimonies for an hour to get back to the Assembly to try and reach a verdict on the Maldonado nomination, and then returned. My Aunt was not discouraged, thankfully, and we hurriedly got her back in line to testify in front of the committee.
Though she was briefly cut off with one sentence left, she was able to say exactly what she wanted and felt good about her visit to Sacramento.
After all the other testimonies were heard, the committee had interesting things to say. Assemblyman Hernandez stated he was very unsure that ADHC can be completely eliminated after what he’d heard and the personal visits he’d made to ADHC centers in the area. He thought cuts could possibly be made, but not a complete elimination. Whispers of relief were heard throughout the room.
Assemblyman Chesbro opened a discussion about particular costs, which Assemblyman Beall quickly joined, adding that perhaps we should add up all the costs of people already in ADHC versus those not in ADHC and look at the differences. Assemblyman Beall thought there might be higher costs without ADHC, and more costs of programs in isolation. He also stated this was something to look at within the Waiver, and that we need a more integrated approach to serving people and saving money.
Overall, the process for my Aunt and Uncle was long and exhausting and they learned a lot. They know it is far from over legislatively, but they are not finished either.
The Senate budget committee moved on a mid-year budget package yesterday. The Assembly Budget Subcommittee on Health and Human Services meets this afternoon to consider elements of the Assembly package.
The worst of the health and human service cuts--like cuts to Medi-Cal and Healthy Families eligibility and benefits--look like they are being deferred to the bigger budget fight later this year, in deciding the 2010-11 budget. This doesn't mean these programs are safe, merely that the day of reckoning is delayed for a few months. Health and human service advocates need to stay vigilant through the next week of negotiation around a mid-year package, and need to continue our work through May Revise and the spring-summer negotiations.
We'll keep you posted from today's budget hearing this afternoon.
The plight of millions of Californians who are uninsured was front and center at the annual Insure the Uninsured Project conference held Wednesday in Sacramento, where hundreds of advocates, state officials and health industry professionals gathered to discuss what’s next for federal health reform.
“Timing is everything,” one panelist declared -- and indeed that proved to be the case during talk of industry abuses that continue to underscore the need for rate regulation and broader reform. The recent widely publicized move by Anthem Blue Cross to raise rates by up to 39% on individual policies was cited frequently by speakers as evidence that federal health care reform must move forward.
Anthem Blue Cross has been at the center of a whirlwind of criticism from President Obama on down. On Wednesday, the subsidiary of Indiana-based WellPoint continued to attract sustained attacks at the conference by consumer advocates, state legislators and even industry representatives.
Assembly Health Committee Chair Dave Jones (D) announced a hearing for February 23, saying he would demand justification for the hefty rate increase from executives of Anthem Blue Cross and of the industry in general. Jones noted that WellPoint pulled in $2.4 billion in profits last year, and that the 39% increase follows years of double-digit premium increases by the company.
State Senator Mark Leno (D), who touted his bill for a single-payer system, said he would join Jones in backing legislation to consider imposing disclosure rules and rate regulation on health insurance plans. Jones said he also planned to continue his push for legislation to require more transparency from the industry and place caps on out-of-pocket costs for consumers.
Several panelists spoke of the deep divides between Democrats and Republicans, expressing hopes that those divides could be bridged by reason.
An afternoon panel of stakeholders was tasked with discussing what shape federal health reform may take. Some snippets included:
--John Arensmeyer of Small Business Majority said including provisions to make insurance affordable was absolutely necessary for small businesses to be able to hire quickly. -- Pat Johnston, head of the California Association of Health Plans, said cost-containment initiatives both on base health costs, and including efforts by health plans to cut back their average 12% overhead costs, would be “a vast improvement over the status quo.” -- Elizabeth McNeil of the California Medical Association said requiring health reform to offer the same level of benefits that members of Congress have would win over the public. -- Anthony Wright, executive director of Health Access, advised conferees to offer support to their representatives in Washington and suggested that, with vocal constituent backing, a comprehensive reform package could pass Congress in March, by Easter break.
Judging from reports by several speakers, the death of health reform is way premature, and the discussion was a reminder of its necessity and urgency, given the severity of the health crisis here in California. The Anthem Blue Cross rate hikes is just a symptom of the situation.
We've long had issues with Anthem Blue Cross of California--both their practices and policy positions. That's why we launched http://www.sickofbluecross.com/, to document these issues and collect stories of aggrieved Californians.
Anthem Blue Cross of California has gotten lots of attention in the past few days, due to its controversial increases of up to 39% for their customers in the individual insurance market, as first reported by Duke Helfand of the Los Angeles Times, who has followed up with reporting the fallout.
* President Obama cited--multiple times!--these rate increases on California consumers as one reason why he is continuing to pursue comprehensive health reform.
* Insurance Commissioner Steve Poizner is investigating the increases, according to the Sacramento Bee. It's indicative of how little oversight California currently places on these rates that the Insurance Commissioner is going to contract with an outside actuary to see if Anthem Blue Cross is complying with existing law.
* California's two Senators have weighed in as well, urging action and review at the state level. As the San Francisco Chronicle reports, Senator Boxer urged state Attorney General Jerry Brown to investigate the proposed rate increases and Feinstein asked state Sen. President Pro-Tem Darrell Steinberg, D-Sacramento, to introduce legislation to regulate rates.
* Assemblyman Dave Jones, the chair of the Assembly Health Committee and someone who has long carried a bill on rate regulation, is holding his own hearing on health insurance rates on February 23rd.
* Others, like Jonathan Cohn at the New Republic, have refuted Anthem's explanations on the large increases, and explained why this situation would be prevented--or at least ameliorated--under health reform.
All of these government officials are right to question the premium spikes by California's largest insurer. While we know health costs grow at a rate higher than inflation, they are not growin anywhere near 20%, 30%, or 39% in the past year. However good it is to have this scrutiny now, the point is we need this oversight on a regular basis, and that's why we need health reform.
Anthem has been a longstanding opponent of health reform. Just a few months ago, Anthem Blue Cross was sending anti-health reform messages to their customers. Their new notices--about their premium increases--is the strongest message to date about why we urgently need health reform.
Consumers who buy coverage as individuals have no bargaining power, and are at the mercy of the big insurance companies. The benefits of health reform is to provide consumers with the power of group purchasing, so we all can get better rates for health coverage. Health reform would also put in place rate review, so insurers would have to justify their rate increases much more than they do now in California.
Health Access California will continue to host www.sickofbluecross.com, that contains more background of Anthem Blue Cross of California's anti-consumer record, and is collecting stories of people's experience with the insurer.
President Obama made a surprise visit to the White House press room today, and spoke on health reform and other issues. He once again spotlighted the premium increases by Anthem Blue Cross of California. Here are some selected comments (with emphasis added) from the President:
During our meeting [with legislative leaders] we also touched briefly on how we can move forward on health reform. I've already announced that in two weeks I'll be holding a meeting with people from both parties, and as I told the congressional leadership, I'm looking forward to a constructive debate with plans that need to be measured against this test:
Does it bring down costs for all Americans as well as for the federal government, which spends a huge amount on health care?
Does it provide adequate protection against abuses by the insurance industry?
Does it make coverage affordable and available to the tens of millions of working Americans who don't have it right now?
And does it help us get on a path of fiscal sustainability?
We also talked about why this is so urgent. Just this week, there was a report that Anthem Blue Cross, which is the largest insurer in the largest state, California, is planning on raising premiums for many individual policyholders by as much as 39 percent. If we don't act, this is just a preview of coming attractions. Premiums will continue to rise for folks with insurance; millions more will lose their coverage altogether; our deficits will continue to grow larger. And we have an obligation -- both parties -- to tackle this issue in a serious way...
We've got to control costs, both for families and businesses, but also for our government. Everybody out there who talks about deficits has to acknowledge that the single biggest driver of our deficits is health care spending. We cannot deal with our deficits and debt long term unless we get a handle on that. So that has to be part of a package.
Number two, we've got to deal with insurance abuses that affect millions of Americans who've got health insurance.
And number three, we've got to make health insurance more available to folks in the individual market, as I just mentioned, in California, who are suddenly seeing their premiums go up 39 percent. That applies to the majority of small businesses, as well as sole proprietors. They are struggling.
So I've got these goals. Now, we have a package, as we work through the differences between the House and the Senate, and we'll put it up on a Web site for all to see over a long period of time, that meets those criteria, meets those goals. But when I was in Baltimore talking to the House Republicans, they indicated, we can accomplish some of these goals at no cost. And I said, great, let me see it. And I have no interest in doing something that's more expensive and harder to accomplish if somebody else has an easier way to do it.
So I'm going to be starting from scratch in the sense that I will be open to any ideas that help promote these goals. What I will not do, what I don't think makes sense and I don't think the American people want to see, would be another year of partisan wrangling around these issues; another six months or eight months or nine months worth of hearings in every single committee in the House and the Senate in which there's a lot of posturing. Let's get the relevant parties together; let's put the best ideas on the table. My hope is that we can find enough overlap that we can say this is the right way to move forward, even if I don't get every single thing that I want.
But here's the point that I made to John Boehner and Mitch McConnell: Bipartisanship can't be that I agree to all the things that they believe in or want, and they agree to none of the things I believe in and want, and that's the price of bipartisanship, right? But that's sometimes the way it gets presented...
Assembly Budget Committee Chair Noreen Evans (D) and others assailed the administration Monday for making cuts to a breast cancer screening program for low-income women against the Legislature’s wishes.
The Department of Public Health in December decided to reduce access to the “Every Woman Counts” early detection program by freezing enrollment until June 2010, and limiting enrollment to only women 50 and older.
For the past decade, the program had offered annual breast cancer screening to low-income women who lacked health insurance and were at least 40 years old. Statewide, 1.2 million are eligible for the program through about 1,000 locations, including community health clinics. The program served 249,000 in fiscal year 2006-2007; 270,000 in fiscal year 2007-2008 and then 310,000 in 2008-2009.
With the demand increasing, however, the Schwarzenegger Administration decided to shift some EWC funding to other programs, thus freeing up some money to help plug the growing budget deficit. This was done even though the Legislature had rejected the cutbacks outlined by the administration during budget negotiations after the governor submitted his May spending-plan revision.
At a hearing well-attended by breast cancer survivors and supporters, an irked Evans told bureaucrats that “It’s unacceptable to me that these screenings won’t take place…In my opinion, we’ve had way too much testosterone in the budget talks….and enough of the macho knife-waving, alpha-male politicians in the process. How many Californians will have to die for budget negotiators to see it’s time for us to grow up?”
Despite having been told by Evans that the planned program cutbacks would not be approved by the Legislature, the Department of Public Health “suddenly and surprisingly changed” the program, Evans said.
Assemblyman Hector de la Torre (D) added, “The administration is not allowed to run around making unilateral decisions. There is a checks-and-balances thing going on here.”
A round of applause broke out in the hearing room after Assemblyman Sandre Swanson (D) said the cutbacks in services would cause greater expenditures in the final analysis, as women get sicker and require extensive treatment. “You’re just shoving these costs off onto other programs – and you are costing lives, too.”
Several medical experts and community providers testified that women who are diagnosed with breast cancer in their 40s are more likely to have aggressive forms of the disease and therefore need early detection to survive. Many also testified that the age-group accessing services through Every Woman Counts are more likely to be women of color with few economic resources.
The hearing came after a bake sale held by Evans, other legislators and breast cancer awareness representatives to raise money and awareness about the program cutbacks. Following the hearing, a large rally was held outside, where several other legislators, including Senate President Pro Tem Darrell Steinberg, declared their opposition to the cuts and support for restoring the program. The rally ended with the Capitol being bathed in pink light, a color of significance for breast cancer survivors. Meanwhile, two bills -- with a third likely to come -- have been proposed to reinstate the program, Evans said.
Republican legislators are viewing President Obama's invitation to the White House with skepticism. I don't doubt the President's sincerity in wanting to take into consideration and even adopt their best ideas. As frustrating as that may be to some of his supporters, he is a consensus builder and organizer, and that is who he is.
But that doesn't mean the Republicans shouldn't be worried. Because I don't think the President is going to give up on his proposals. And because the Congressional Republican leadership doesn't have a comprehensive solution to the health care crisis. The spotlight that the President has put on alternative reforms has shown them to be ineffective, but ones that provide less security and stability, not more.
Change can be scary, especially when there's an entire political party feeding that fear and mistrust. Consumers don't like the status quo, but it can be seen to be comforting compared to the unknown. If it's a fight between a complex reform with both benefits and burdens (and any reform of health care is going to be complex) with the status quo, the status quo has a distinct advantage.
President Obama wants to make this a fight between the change you want, versus the change you don't. Reformers make the point--correctly--that the status quo isn't an option, since the current health system is unravelling.
The summit will counterpose not change vs. the status quo, but what kind of change is appropriate. And the comparison isn't close: * Jonathan Cohn of the New Republica analyzes the Republican plan for health reform in their “Roadmap for America's Future,” a much more radical privatization of Medicare than people realize. * Ezra Klein of the Washington Post examines the Republican ideas that are already in the health reform bills * Greg Sargent at the Plum Line shows how the GOP response so far is a rejection of bald-faced rejection of any negotiation or compromise.
FYI, I'll be on a panel at the Insure the Uninsured Project conference this Wednesday, February 10th, in Sacramento. Should be an interesting conference, with the mix of anticipation and uncertainty around reform right now.
Maybe this is how we get some rate review after all.
U.S. Department of Health and Human Services (HHS) Secretary Kathleen Sebelius today sent a letter to Anthem Blue Cross of California urging it to publicly justify its premium hikes for its California individual market customers--hikes that are as much as 39 percent.
Here's the letter:
February 8, 2010
Leslie Margolin President, Anthem Blue Cross
Dear Ms. Margolin,
One of the biggest pressures facing families, businesses and governments at every level are skyrocketing health insurance costs. With so many families already affected by rising costs, I was very disturbed to learn through media accounts that Anthem Blue Cross plans to raise premiums for its California customers by as much as 39 percent. These extraordinary increases are up to 15 times faster than inflation and threaten to make health care unaffordable for hundreds of thousands of Californians, many of whom are already struggling to make ends meet in a difficult economy.
Your company's strong financial position makes these rate increases even more difficult to understand. As you know, your parent company, WellPoint Incorporated, has seen its profits soar, earning $2.7 billion in the last quarter of 2009 alone.
I believe Anthem Blue Cross has a responsibility to provide a detailed justification for these rate increases to the public. Additionally, you should make public information on the percent of your individual market premiums that is used for medical care versus the percent that is used for administrative costs. Policy holders in the individual market deserve to know if their premium increases would be invested in better medical care or insurance company overhead costs like salaries, profits, and advertising. I am aware that the State of California is investigating this matter, and urge Anthem Blue Cross to cooperate fully. In the meantime, I will be closely monitoring the situation.
At a time when health care costs are a critical threat to families as well as the nation's economy, I hope you appreciate the urgent nature of this request. I look forward to your prompt reply.
Sincerely, Kathleen Sebelius Secretary of Health and Human Services
If you have been impacted by this premium increase, visit www.sickofbluecross.com, and tell your story to us...
with a background as a consumer advocate and community organizer on many issues, including health issues for the last ten years in California and New Jersey.
