One of my friends who is an MD has taken a look at the health bill and points out some problems which I've tried to summarize below.
1. New mandates
Because there are additional requirements placed on health insurance policies being offered, the premiums have risen to pay for those new features. In the recent open enrollment at my work place, most plans showed a rise in monthly costs.
2. Dropped coverage
In some cases (mini-med plans), employers have had to drop coverage because those plans didn't measure up to the new regulations. Many companies have applied for waivers to keep offering these plans and have been granted temporary waivers by HHS. One wonders how many weren't granted waivers? Also, what will happen when the waivers expire?
3. Medical loss ratio
The new regulations require that insurance companies must spend 80-85 percent of their costs on patient care. He thinks this is a bad idea and explained it this way:
This "medical loss ratio" rule is like the government telling restaurant owners that 80 to 85 cents out of every dollar that the consumer pays must go to food that can "actually" be eaten by the consumer. That will, at least in theory, make sure that the restaurant owner will not overpay in his mortgages or spend money on unnecessarily expensive silverware. How much the owner pays the waitress or the electric company is also included in the "operation" side and not in the "food" side of the ratio. The business of serving food is food; hence it is entirely logical that 80-85% of what the consumer pays must go to actual food and not wasted on the "operation" of the business.
The unintended consequence of the "medical loss ratio" is that:
(A) the government decides what constitutes actual care increasing the regulatory power of the government; will explicit wage/price controls be next?
(B) some insurance companies will get out of the health insurance business leaving less choice for the consumer
(C) insurance companies will "overpay" for items that the government calls "actual care" so they can be in compliance with regulators.
Regulating the health insurance industry is a complicated thing. It may be well intentioned that insurance policies be required to cover more things but it costs money to do so and less robust but more affordable plans will get dropped. "Medical loss ratio" is one step removed from wage and price controls which is fools gold for "bending the cost curve."
Rambling about soccer: LA Galaxy, IF Elfsborg, Falkenbergs FF, Liverpool FC, Queens Park Rangers, and LAFC. Also random rambling about Star Trek, LA sports (Dodgers, UCLA, Kings, Lakers, Rams), politics (centrist), faith (Christian), and life. Send comments to rrblog[at]yahoo[dot]com.
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