The premise of health insurance is simple – insureds pay insurance companies a premium with the expectation that when the insured needs medical care, it will be funded by the insurance company (subject to the policy conditions). And if the care required is really expensive, well, that’s why you have insurance.
The relationship is inherently based on trust; the insured trusts the insurance company to pay the bills and the insurance company trusts the insured to pay the premiums. Actually, there’s not a lot of trust on the part of the insurer, as they just cut off benefits when premium payments stop coming in. But the insureds trust the insurer to pay the bills, cover expenses, and treat them fairly.
What happens when that trust breaks down? Does it do lasting damage to the relationship between and among individuals and insurers? Absolutely.
“While deception may be tempting because it can be used to increase short-term profits for the deceiver, we find that the long-term costs of deception are very high,” the researchers conclude. In other words, in long-term relationships, it pays to cooperate.” This quote is from a very interesting experiment conducted by a couple Wharton Business School professors which examined the implications of deception on relationships between individuals.
Research indicates the health insurance industry ranks pretty low in terms of respecting customers, and customer respect, with 3 out of 5 respondents saying their general trust for insurance companies is “not much” or “not at all”.
Moreover, polls indicate that people would be willing to pay more to see certain doctors, under certain conditions. This being the case, it is puzzling as to why HSA plan sponsors (insurance companies) aren’t more forthcoming, and don’t explicitly inform insureds that services rendered by providers must be “covered” under the plan definitions if the negotiated rate is going to apply. If their members are OK with paying more, then insurers should just tell them, clearly and up front, that non-covered services are going to cost whatever the provider charges.
Many health insurance executives appear to have a large blind spot when it comes to their customers’ reactions to policy limits and restrictions. They don’t seem to “get” that customers are not expert in parsing policy language, don’t understand the intricacies of policy limits and restrictions, and get angry when they think they’re being mistreated.
The net is, insurance companies may save a few bucks by not telling HDHP buyers that their negotiated discounts don’t apply to non-covered services, but they will likely lose customers, and may well lose their battle against tighter regulation as a result.
What does this mean for you?
Perception is king, and customers/voters/health care consumers perceptions of insurers’ practices may well result in “unintended consequences” for the insurers.
Jul
27
There in lies the problem Joe, insurance companies won’t lose customers.
Most of us are captive to the health care insurance selection of our employer. It’s not likely that we could change even if we wanted.
And if you purchase insurance on your own, and have a pre-existing condition, it becomes impossible to switch providers, without incurring an extreme cost penalty.
Health insurance companies know they have the consumer over a barrel, and that’s why they can continue to act with total impunity to screw the consumer whenever they find it to their advantage.
Carriers hide behind voice mail, IVR systems, web sites and HIPAA to keep from addressing the needs of policyholders. They really don’t CARE about consumers because they view themselves as simply providing a product. It doesn’t have to be innovative. It doesn’t even have to be beneficial. However it does need to be cheap.
Of course you can blame the consumer and the “information age” on some of it. Consumers want low price and are willing to sacrifice value in order to save a buck. Of course they are usually short-sighted in that, the things they give up to save a few premium dollars are the same things that will put them in a hole when a major claim comes along.
In my opinion, the fully insured carriers have dropped the ball on this. They fail to realize that by giving away something that cost them NOTHING (access to FULL repricing) they could benefit greatly by client loyalty.
That approach is pretty stupid in my mind.
Joe – I think the relationship between insurer and beneficiary has been breaking down progressively since the move away from full indemnity plans towards HM0s in the 80s. The history since then has been serial – insurers create tight closed networks, beneficiaries lose trust and complain, model breaks. Networks open up, costs accelerate, employers look to cost shift, increase employee cost sharing and deductibles. Employees realize the are not getting good value and look for alternative – HSAs spring up.
I am more cynical than the average bear but I personally think that very few forms of insurance are worth the premium. I thought long and hard about getting an HSA/high deductible plan, but opted not to because I felt the premium for the high deductible plan was exorbitant. Perhaps I am foolish, but what I would really like is a REALLY HIGH (say $20k) deductible plan that is dirt cheap, combined with FULL ACCESS to discounted fee schedules.
When you get right down to it, there is NO WAY for a provider to justify an $800 bill when they are willing to provide equal services for $250.
The “any willing provider” concept should work in inverse mode – perhaps there should be legislation prohibiting providers from setting gross charges at more than 120% (or pick a different reasonable number) of their lowest contracted rate.
And thanks for the response to my question on the prior post. Had no idea UNH had set up a bank. Personally, I think that’s far more dangerous than Wal-Mart….
I agree with Rational on two of his key points. First, a very high deductible policy with complete access to contract rates below the deductible would be an attractive product to me if the price were low enough. Insurance should pay 100% of covered services with no co-pays once the deductible is hit. Second, uninsured patients should not have to pay more than the greater of, say 115%-120% of the Medicare rate or the rate accepted from the private insurer with whom the provider does the most business.
I recently asked HCA if it makes money overall on its Medicare and Medicaid business. It said it definitely does make money on Medicare but only roughly covers its costs on Medicaid business. He further indicated that Medicaid pays them only about 20% of their charges (list price). Will common sense and common decency ever come to this industry? How hard could it be to treat people they way you would like to be treated?
They don’t seem to “get” that customers are not expert in parsing policy language, ****************
I would disagree- I think they are betting the farm on this very fact. And their first born child.
In my dealings in a managed care situation in the form of a workers insurance board, I am absolutely sure that the language that is used is meant to obfusicate everything that will, might, maybe happen to the client. There are no “set in stone” policies, it is “interpreted” differently by different people working for the board, and believe you me, if I had a nickel for every time they hid behind the “difference in interpretation” I would be rich.
Never imagine that these people don’t really know that their language is something to hide behind. Like many here, I have NO CHOICE as to who covers people in case of an accident.
They can take that to the bank as they deny treatment and all, because they also know that because most people are not able to get through the fine print, they are not going to fight for stuff that they could fight for. ANd, if they are using industry language in a population that is at best reading at an eighth grade level….. whooo hoo, more money for them. Add to that the stress of a crisis and you have an awful lot of people not willing or able to fight for the fine print.
Cynical- oh I have that one covered. I have no respect for companies that think that they can make their money off of lies and damned statistics.
Look at what is happening in your country with the seniors Medicare ——- many people are now completely messed because they thought they picked the best option after reading through a lot of information- and now they are out of pocket an awful lot of money.
Loyalty- to the shareholders and the almighty buck —- and only if IT is going up!!!!
The Medicaid Payment ratio to billed charges varies greatly from state to state. In Texas, it’s about 25%. In Florida, it’s closer to 10%. In Utah, it’s around 50%. And this is across several hospital systems, so it’s not just one hospital’s billing practice.
But in the case of many hospitals (though probably not an HCA hospital if I remember their business model correctly) they can make up to $1500 per Medicaid patient day on their Medicare disproportionate share calculation and if they are classified as a Medicaid Dispro hospital, it can be huge dollars. So in the end, many hospitals are making plenty off their Medicaid patients, even if the ratio of charges to reimbursement doesn’t reflect that.
I understand the debate about what rates the insurance companies get for the people that are on the HDHP plans. No part of the discussion, though, seems to have hit upon the fact that the health care provider doesn’t have to charge full-fee, even if he isn’t *required* to give a discount. The patient needs to take some responsibility for finding out costs of procedures *ahead* of time. If it sounds too high, then tell the doctor that it needs to get cheaper, or you’ll find someone else. My wife and I don’t have an HDHP, but when the facility cost for her upcoming procedure was priced out at $2400, we made some calls and fired them, after we found a facility that is even better, for $800. Of course, this only works if the doctor that’s making the pricing decision stands to lose money if you walk away. If the decisionmakers don’t *lose* anything by patients walking away, then they won’t have any incentive to negotiate.
UHC lied to me regarding coverage. I don’t have the money or the energy anymore to fight them. They purposely misled my wife and I just so they could deny payment of a $20,000 surgery.
By running a little misdirection from their customer service dept. they were able to avoid paying the claim saying I went “out of network”.
They tell the State of Wi. Insurance Commissioner they can’t be investigated because of the HIPPA law.
Is there something I can do? I keep filing appeals only to be told UHC denies any wrongdoing. I have 2 reference numbers in regard to my conversation with their reps. In one statement I was told I would be covered by my plan. I had the surgery. When I received a notice stating they had denied all coverage I called back to UHC and was told I received incorrect information and that I was now responsible for the cost of the surgery in it’s entirety. Can someone direct me to an organization for help. I wouldn’t hesitate to submit my story and all documentation in order to bring UHC a little bit of the pain & misery they have caused me & my family.
Thank you for letting me vent.
Jim
Competition in Health Care:
Both Health Insurance and Provider Markets Need to Function Competitively
As in other markets, the goal for health care markets should be to ensure that consumers benefit from a competitive marketplace where neither the buyers nor sellers unlawfully exercise market power. Policy should focus on ensuring that there is a competitive marketplace where neither health insurance plans nor health care professionals are able to obtain or exercise market power to distort the competitive outcome. Any other result inevitably will lead to governmental regulation of the health care market — an outcome that is not likely to produce desirable results for consumers. We have learned this lesson over time from other industries and we should be sure we continue to apply it to health care markets as well. The injection of competition into quality health care markets over the past decade should have helped hold down increases in health care costs. But not enough.
1. Consumers/patients should get the cost of services, prior to providing any healthcare services.
2. Consumers/patients should not be forced due to emergency medical condition pay exorbitant fees and costs. (No price gouging)
3. Consumers/patients should have a government agency where they can complain when charges are exorbitant and way above the cost of the competition.
4. Just because the Health Insurance Company pays the bill, it is not permitted for the healthcare service provider to bill exorbitant billing, The consumer/patient pay a percentage of the services, therefore price and costs are important, not to mention that if healthcare costs and billing to the Healthcare Insurance is exorbitant, this will increase the costs of health insurance to the employer and employee.
5. Uninsured/consumers/patients should not have to pay higher prices for healthcare services than insured consumers/patients.
6. How do you treat a healthcare provider who were found to abuse and charge exorbitant prices for its service, were fined by the government and now continues to charge exorbitant charges for its services? The penalty should be that the consumer/patient bill should be nullified. (plus other appropriate penalties).
7. Any provider found to be over-billing, inflating billing, gouging prices and billing, or billing for services not rendered – should have severe civil and criminal penalties.
8. Much more to come
By: Yehuda Draiman, Billing auditor
Nachshon Draiman, Nursing Homes owner.
Nachshon Draiman and Multiut charged with a $15 million judgment for fraud
Honorable John A. Nordberg: Enter Memorandum Opinion and Order.
For the reasons set forth above, defendants motion for summary judgment is granted, and judgment is granted to plaintiff, and against defendants Multiut and Nachshon Draiman
Case 1:02-cv-07446 Document 228 Filed 06/11/2008 Page 1 of 1
UNITED STATES DISTRICT COURT
FOR THE Northern District of Illinois − CM/ECF LIVE, Ver 3.2.1
Eastern Division
Dynegy Marketing and Trade
Plaintiff,
v. Case No.: 1:02−cv−07446
Hon. John A. Nordberg
Multiut Corporation, Nachshon Draiman, Future Associates, et al.
Defendant.
NOTIFICATION OF DOCKET ENTRY
This docket entry was made by the Clerk on Wednesday, June 11, 2008:
MINUTE entry before the Honorable John A. Nordberg:Enter Memorandum
Opinion and Order. For the reasons set forth above, defendants motion for summary judgment is granted, and judgment is granted to plaintiff, and against defendants Multiut and Nachshon Draiman, on Counts I and II of plaintiffs amended complaint, in the amount of
$15,348,244.72 plus interest accruing from October 1, 2004. Judgment is granted for plaintiff and against defendants on Counts I through VI of defendants
counterclaims.Status hearing set for 10/2/2008 at 2:30 PM. [183],[196]Mailed notice(tlp, )
ATTENTION: This notice is being sent pursuant to Rule 77(d) of the Federal Rules of Civil Procedure or Rule 49(c) of the Federal Rules of Criminal Procedure. It was generated by CM/ECF, the automated docketing system used to maintain the civil and criminal dockets of this District. If a minute order or other document is enclosed, please refer to it for additional information.
For scheduled events, motion practices, recent opinions and other information, visit our web site at http://www.ilnd.uscourts.gov.
CONCLUSION
For the reasons set forth above, defendant’s motion for summary judgment is granted, and judgment is granted to plaintiff, and against defendants Multiut and Nachshon Draiman, on Counts I and II of plaintiff’s amended complaint, in the amount of $15,348,244.72 plus interest ($21 million) accruing from October 1, 2004. Judgment is granted for plaintiff and against defendants on Counts I through VI of defendants’ counterclaims.
FN1. Dynegy has also filed several fraudulent transfer counts alleging that Nachshon Draiman caused Multiut to transfer over $21 million to himself, his family, and related business entities and that most of this money came from the sale of gas delivered by Dynegy. But the present summary judgment motion does not address these counts. (with interest it is $21,000,000 million)
N.D.Ill.,2008.
Dynegy Marketing and Trade v. Multiut Corp.
Slip Copy, 2008 WL 2410425 (N.D.Ill.)
See: http://www.nachshondraiman.net
END OF DOCUMENT
Nachshon Draiman, Chicago – nursing home administrator license (044001323). revoked
Illinois Department of Financial and Professional Regulation 2008
File Format: PDF/Adobe Acrobat – View as HTML
Nachshon Draiman, Chicago – nursing home administrator license (044001323). revoked and fined $2000 for misrepresenting information in his application …
http://www.idfpr.com/Forms/DISCPLN/0108_dis.pdf – Similar pages
See: http://www.nachshondraiman.net