Countdown - CIGNA whistleblower Wendel Potter describes the state of health care legislation

[slipslidingaway]

Run time: 05:26 https://www.youtube.com/watch?v=AhOcNtkxj70   Posted on YouTube: December 23, 2009 By YouTube Member: firedoglake Views on YouTube: 1232   Posted on DU: March 12, 2010 By DU Member: slipslidingaway Views on DU: 395

 
Thanks to DUer laughingliberal for recalling this interview...
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=7894063&mesg_id=7894930


Who’s Enforcing The Medical Loss Ratio?
http://news.firedoglake.com/2009/12/23/whos-enforcing-the-medical-loss-ratio/

"Last night, former insurance industry executive Wendell Potter appeared on Countdown, claiming that the industry could get around the requirements on the medical loss ratio through accounting tricks. To recap, under the Senate bill, the insurance industry would be required to spend 85 cents of every dollar in the large-group market, and 80 cents in the small-group and individual markets, on medical care, rather than overhead, administrative costs, salaries, marketing and profit.

An article at Smart Money magazine suggests that the insurance industry is already looking for ways to wiggle out of this requirement:

It’s not all good news for insurers. The Senate bill would impose a “medical loss ratio” of 80% to 85%, depending on the market segment, meaning insurers would have to spend 80 to 85 cents of each dollar they collect from plan members to provide health care. Carl McDonald, a health care analyst with Oppenheimer & Co., an investment bank, wrote in a note to clients Monday that the number was “workable” for insurers, especially if they can label certain items that count as corporate expenses for accounting purposes as health care for purposes of meeting the spending minimum...


As Lawrence O’Donnell noted, there’s nobody in the federal government with the knowledge of how to determine medical loss ratios of insurance companies.

What this comes down to is that moving to a regulatory environment to manage the health care system rather than a public-private competition environment can work, but only with an actual police force. And it’s unclear where that police force is right now..."


Amazing secrets of the Senate healthcare bill revealed, using middle-school math

http://www.examiner.com/x-19087-Special-Interests-Examiner~y2010m2d2-Amazing-secrets-of-the-Senate-healthcare-bill-revealed-using-middleschool-math

"...Let’s get right to it. Section 2718 of the Senate bill provides that...

Health insurance companies will be required to report publicly the percentage of total premium revenue that is expended on clinical services, and quality rather than administrative costs. Health insurance companies will be required to refund each enrollee by the amount by which premium revenue expended by the health insurer for non-claims costs exceeds 20 percent in the group market and 25 percent in the individual market. The requirement to provide a refund expires on December 31, 2013, but the requirement to report percentages continues.(1)


Talk about “refunds” to patients sounds good at first, but what the Senate is really saying here is that the Senate bill requires private insurers to spend only 75 to 80 percent of every premium dollar on actual health care. OK, so what does that mean?

Let’s put it another way: the Senate bill authorizes private insurers to consume 20 to 25 percent of every premium dollar on administrative costs.

But according to the Senate’s own data, ordinary Medicare's administrative costs are only 2%.(2) In other words, if we simply opened ordinary Medicare to uninsured Americans, 98 cents of every Medicare dollar would buy actual health care..."

[ljm2002]

1. I'm glad someone else noticed...

...that medical loss ratios give insurance companies a strong incentive to raise their rates.

K&R

[slipslidingaway]

2. Thanks :) n/t