The O - H - I.O.U.

Under the Patient Protection and Affordable Care Act a new type of insurance issuer called a CO-OP must be created in every state. These CO-OPs are high-risk ventures: the Office of Budget and Management has projected a default rate for them as high as 43%. Through 2012 over $2 Billion had been distributed by HHS to these start up insurers. 

Last week Mike wrote an excellent post on one of them in New York which you can read here.

This week the Buckeye state announced their list of insurers seeking to play in the CO-OP sandbox. The list included:  Aetna (Individual only), AultCare, Community (Anthem), Coordinated Health Mutual, Coventry (Individual only), Kaiser Foundation Health Plan (Small Group only), Medical Health Insuring Corporation of OH (MMO), and Summa.

While there may be additional companies announced later, the one that really stands out is a company that may be unfamiliar to agents and consumers, new kid on the block, Coordinated Health Mutual. They are a CO-OP who received a federal grant for $129,225,604 in late 2012. Coordinated Health Plans of Ohio is sponsored by Community Health Solutions of America LLC, which also runs primary care medical homes for state Medicaid programs.

Sounds innocent enough right? Lets connect some dots:

According to filings, Brett Baby, CEO of Coordinated Health, and Community Health Solutions (CHS) of America LLC CEO, Dale F. Schmidt have troubled histories. Baby was the former CEO of Physicians Insurance Company of Ohio. They made it an entire year before going under when regulators shut them down for dropping $5 million in reserves. Schmidt has a longer history including chapter 11 bankruptcy filings in 2006 (including CHS), a 2011 Medicaid overpayment in South Carolina to his firm for $10 million, and back taxes owed in 2012 to the state of Kentucky.

Brett and Dale are just the type of high quality financial gurus we want running an insurance company.

What's most disturbing about the entire CO-OP process is that despite these risks and questionable backgrounds CMS refuses to answer questions about how recipients are chosen or any other information about the program. President Obama and Secretary Sebelius have asked for transparency in health care pricing. Evidently it's too much to ask of them to have transparency in health insurance regulation.

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Health Wonk Review: "Is this question rhetorical?" Edition

Sarah Sonies and Jennifer Salopek present an outstanding Health Wonk Review, covering everything from care for undocumented illegal immigrants to neuroscience.

What makes this week's edition so terrific is that it's obvious that Sarah and Jennifer have read all the entries, offering thoughtful context and commentary on each one.

Kudos!

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Dribbling the ObamaTax

Back in the day, Ms Shecantbeserious had Matlock to Hawk the train-wreck. Fast forward a bit, and she's Cavalierly bringing the Heat in her efforts to work her Wizardly Magic on that Nugget:

"The Obama administration has reportedly tried to enlist the NBA in helping it sell Obamacare"

Whatever works to sell this Maverick idea to the masses, right, Kathy?

But lets give her the benefit of the doubt and presume that this new gimmick will work (hey, it could happen!). Good thing that the Exchanges new Marketplaces will be on their game for the roll-out.

Wait, what?

"Government officials have missed several deadlines in setting up new health-insurance exchanges for small businesses and consumers ... and there is a risk they won't be ready to open on time in October"

Ooopsies.

Looks like those darned Canucks are throwing us under the bus.

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The ObamaTax vs City Hall

Regular readers know that one major effect of the train wreck has been reduced hours for part-time employees:

"[E]ven those fortunate enough to keep their current jobs (let alone obtain new employment) may be subject to reduced hours (and thus pay)"

Restaurants and movie theaters, theme parks and community colleges are all slashing employees' hours, if not their jobs. But the private sector isn't the only area feeling the pinch. As we noted last week, folks in Capital City "are so afraid that their health insurance premiums will skyrocket next year thanks to Obamacare that they are thinking about retiring early or just quitting."

What you may not know, though, is that you don't have to travel to DC to find the ripple effects of the ObamaTax:

"[L]ocal governments across the country have been ... cutting part-time hours specifically so they can skirt ObamaCare's costly employer mandate, while complaining about the law in some of the harshest terms anyone has uttered in public."

From California to Virginia, Texas to Michigan, local municipalities are coping with the drastic new regs in one of the few ways still available:

"We feel bad as a city administration and as a council in having to cut hours from 35 to 29," Medina [OH] Mayor Dennis Hanwell said. "We have the budget to pay the people, but we do not have the budget to pay for the health care." If they hadn't made that cut, the city faced up to $1 million in new health costs courtesy of ObamaCare."

For a city like Medina (just shy of 27,000 souls), that's a pretty hefty chunk of change. And when you start multiplying that by all the small towns across the fruited plain, you're talking serious coin. With U6 unemployment in the double digits, it's difficult for smaller cities to keep hitting their citizens with more and more taxes to cover public sector health insurance costs. Shrinking tax bases and increased insurance costs make for a powerful (and dangerous) combination, as we're seeing now.

Methinks it will only get worse.

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On being careful what we wish for...

By now, most folks know that Sarah Murnaghan got her new lungs, and for that we say "Baruch HaShem" (Praised be G-d). As life is the most precious of gifts, one can't help but be moved by her new-found hope and lease on life.

In Judaism, we are encouraged to consider all facets of a given subject or issue. That is, our job is to find "balance," and so even happy occasions require us to consider the not-so-happy alternatives (eg breaking of the glass at a wedding). And there are plenty of negative aspects to this story, as well.

Let's start with the most obvious: as we noted in our original post on the subject, how do the transplant folks say "no" to the next little boy or girl who wants a shot at adult organs? Has the process, which seemed to be working well and fairly up to now, been irretrievably broken?

I think there's a very strong case to be made that the answer is "yes:" from this point forth, it will be the lawyers, judges and media making life-or-death decisions. Two old saws seem to have been proven right here: "once is always" and "the squeaky wheel gets the grease." That is, the precedent has now been set that the ones with the most photogenic donee and the most money and the best "story" are going to be getting free passes to the front of the queue, leaving those with fewer such resources in the dust, regardless of actual need or physical condition.

Dr. Sander Florman, director of the Mount Sinai Recanati/Miller Transplantation Institute in New York, notes that "we can all sympathize with the plight of a young girl, but maybe a 13-year-old girl waiting for an adult organ is the one who didn't get a transplant."

Indeed.

And that brings us to the next question: what mother or father, or sister or brother, was just condemned to death so that little Sarah might live? And don't be fooled: this is exactly the outcome here. Someone else on the list, presumably much higher on it, in fact, was passed over for that set of lungs, and there's no guarantee that another suitable set will be available in time.

Now, the organization which oversees transplants has added a codicil "that allows for occasional exceptions. These children have to be recommended by their doctors and then have their cases reviewed by a national board before they can actually be exempted;" which is all well and good, until one notices that the criteria seem to be rather self-fulfilling.

And, finally, there's this: the case of Ms Sarah actually serves to underscore that which another (older) Sarah noted with the passage of the ObamaTax: Death Panels. And make no mistake, that is precisely what happened here: a government employee - who, by the way, is not a doctor and apparently has zero medical training - just condemned to death an adult who was not as cute and cuddly as Sarah Murnaghan, and whose family did not have the means and the media to plead their case (if they even knew about it in the first place).

I'll allude back to Mr Chesterton here:

"In the matter of reforming things, as distinct from deforming them, there is one plain and simple principle; a principle which will probably be called a paradox. There exists in such a case a certain institution or law; let us say, for the sake of simplicity, a fence or gate erected across a road. The more modern type of reformer goes gaily up to it and says, “I don’t see the use of this; let us clear it away.” To which the more intelligent type of reformer will do well to answer: “If you don’t see the use of it, I certainly won’t let you clear it away. Go away and think. Then, when you can come back and tell me that you do see the use of it, I may allow you to destroy it.”

[Major Thanks to co-blogger Bob V for the tip to the Yahoo article!]

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Life Insurance, Long Term Care, Medicaid and You

Not so sure that this is such a great idea:

"State lawmakers are encouraging elderly residents to use life insurance as a way to pay for long-term care—and lower the Medicaid tab in the process."

The concept seems pretty straightforward: you take an older life insurance policy and sell it ("viaticate" is the technical term), and then use the proceeds to pay for long term care. When the policy's value is used up, one turns to Medicaid for continued long term care funding.

This is not a new idea, but the fact that states are now touting it as a viable LTC funding vehicle is telling: they're running out of money and are desperately looking for ways to slow down the ticking time bomb. Under current Medicaid rules, one is allowed to have some life insurance, but of course, that's an asset that states would very much like to tap.

Another factor is marketability. If there's a sudden glut of life insurance policies hitting the market, then of course the price that they command will be affected. Add in the fact that the key phrase in LTC is long term and potential investors could be waiting many, many years for a payoff. Not a great selling point.

But what I find so disgusting here is the states' apparent disregard for their own previous condemnation of stranger-owned life insurance. If it's morally reprehensible in one circumstance, why is it suddenly noble in this application?

Consider that rhetorical.

[Hat Tip: FoIB Holly R]

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Exposing Your Private Parts

The federal government under Obamacare will be exposing your private parts. Most of the consumer protection that was put in place under the Clinton administration now goes away under Obama.  

A new rule issued late Friday requires state, federal and local agencies as well as health insurers to swap the protected personal health information of anybody seeking to join the new health care program that will be enforced by the Internal Revenue Service.

Personal health information, or PHI, is highly protected under federal law, but the latest ruling from the Department of Health and Human Services allows agencies to trade the information to verify that Obamacare applicants are getting the minimum amount of health insurance coverage they need from the health "exchanges."

Washington Examiner

And you thought the NSA was bad.

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