Health Care

[untateve]

http://www.beloitdailynews.com/articles/20...lth/hel1504.txt

 

Health insurer hikes rate 39%

 

Published: Monday, February 15, 2010 1:57 PM CST

Health reform debate heats up

 

INDIANAPOLIS (AP) — Health insurer WellPoint blames the Great Recession and rising medical costs for its planned 39 percent rate increase for some California customers. To President Barack Obama, however, its Exhibit A in his campaign to revive the health care overhaul.

 

Health and Human Services Secretary Kathleen Sebelius, who received the company’s explanation in a letter Thursday, said “it remains difficult to understand” how premium increases of that size by can be justified when WellPoint Inc. reported a $2.7 billion profit in the last quarter of 2009.

 

“This is a stark illustration of what the status quo means for American families,” said White House spokesman Reid Cherlin. “You’d be hard-pressed to find a better example of why reform is so urgent, and it’s going to continue to be part of the case the president makes.”

 

*

Majority leader Harry Reid, D-Nev., went further. In a speech on the Senate floor, he attacked WellPoint and other “greedy insurance companies that care more about profits than people.”

 

“They get rich while people who already can barely afford their coverage lose their coverage altogether,” Reid said.

 

Whether it will be enough to re-ignite the sputtering health care legislation, remains uncertain. The Democratic bills are stalled for political and policy reasons unrelated to insurance costs. Democrats in the House can’t accept the health care bill that Democrats in the Senate have produced, and vice versa. There are also concerns about the cost of the legislation.

 

The rate hike shock, however, could help Obama make his case that Republicans need to come to the table on health care. GOP leaders, who want to start talks over from scratch, are going reluctantly to the Feb. 25 health care summit convened by the president.

 

Brian Sassi, the head of WellPoint’s consumer business unit, said in his letter to Sebelius that the weak economy is leading individual insurance buyers who don’t have access to group plans to drop coverage or buy cheaper plans. That reduces the premium revenue available to cover claims from sicker customers who are keeping their coverage.

 

The result was a 2009 loss for the Anthem Blue Cross unit that sells individual policies to people who don’t get insurance through their employers, he said. Higher rates for this group, which accounts for about 10 percent of Anthem’s eight million customers in California, are needed to cover the shortfall expected from the continuation of that trend, according to the letter.

 

“When the healthy leave and the sick stay, that is going to dramatically drive up costs,” Sassi said in an interview. He declined to specify the size of the unit’s loss.

 

Sassi told Sebelius that insurance costs also continue to rise because medical prices are increasing faster than inflation, and people are using more health care. That use increase is driven by an aging population, new treatments and “more intensive diagnostic testing,” he wrote.

 

Sebelius ordered a federal inquiry earlier this week after the size of proposed premium increases for individual policies was widely publicized. A congressional committee also has asked for information on the increases and requested testimony from WellPoint CEO Angela Braly at a Feb. 24 hearing.

 

“A lot of companies are hurting in this economy but this California health company isn’t one of them,” Reid said, citing Wellpoint’s profits.

 

“That’s why we need health reform like the bills already passed by the House and Senate that will rein in insurance company abuses and make coverage more affordable for millions of Americans, and provide coverage for some 30 million that have no health insurance,” he said.

 

But Sassi disputed that notion in his letter to Sibelius. He said both the House and Senate bills carve too many loopholes from a requirement that everyone buy health insurance. He said they are also weak on enforcement and set penalties that are too low to ensure compliance.

 

WellPoint is the largest publicly traded health insurer based on membership and is a dominant player in the individual insurance market in California. Based in Indianapolis, the company runs Blue Cross and Blue Shield plans in 14 states and Unicare plans in several others.

[bpwallace49]

WellPoint is the largest publicly traded health insurer based on membership and is a dominant player in the individual insurance market in California. Based in Indianapolis, the company runs Blue Cross and Blue Shield plans in 14 states and Unicare plans in several others.

 

I guess that is why the health care at my place of business went up 54% this year . . . thanks BCBS!!!! Keep those profits rollin in!

[Piles]

There is no doubt that there is some fat that needs to be trimmed in some of these for profit health insurers. The rate increase is absolutely exorbitant. That being said I always find it interesting that the insurers are always to blame. Nobody wants to put any blame on the pharmaceutical industry which I think is a mistake. Take a look at drugs used to treat Multple Sclerosis - Avonex has gone up 100% in 5 years and now costs 36k per year. New oral oncology drugs that don't increase overall survival but cost 60k-100k per year. I could go on and on but won't belabor the point. I'm not saying that insurers are blameless but there is A LOT of blame to go around here.

 

ETA Profit margins from the link above:

Amgen (biotechnology): Profit margin, 30.6 percent

Gilead Sciences (biotechnology): 37.6 percent

Celgene Corp. (biotechnology): 11.9 percent

Johnson & Johnson (drug manufacturer): 20.8 percent

Pfizer (drug manufacturer): 16.3 percent

GlaxoSmithKline (drug manufacturer): 17.4 percent

WellPoint: 4%

Edited February 16, 2010 by Piles

[Chavez]

Nobody wants to put any blame on the pharmaceutical industry which I think is a mistake. Take a look at drugs used to treat Multple Sclerosis - Avonex has gone up 100% in 5 years and now costs 36k per year. New oral oncology drugs that don't increase overall survival but cost 60k-100k per year. I could go on and on but won't belabor the point. I'm not saying that insurers are blameless but there is A LOT of blame to go around here.

Big pharm is the devil.

 

What's funny about the Avonex issue is that pharm companies generally defend the bloated prices as an attempt to recoup their R&D costs.

 

Of course, R&D is ALREADY spent and priced in. Jacking up the after the initial cost really looks like a cash grab.

[bpwallace49]

There is no doubt that there is some fat that needs to be trimmed in some of these for profit health insurers. The rate increase is absolutely exorbitant. That being said I always find it interesting that the insurers are always to blame. Nobody wants to put any blame on the pharmaceutical industry which I think is a mistake. Take a look at drugs used to treat Multple Sclerosis - Avonex has gone up 100% in 5 years and now costs 36k per year. New oral oncology drugs that don't increase overall survival but cost 60k-100k per year. I could go on and on but won't belabor the point. I'm not saying that insurers are blameless but there is A LOT of blame to go around here.

 

ETA Profit margins from the link above:

Amgen (biotechnology): Profit margin, 30.6 percent

Gilead Sciences (biotechnology): 37.6 percent

Celgene Corp. (biotechnology): 11.9 percent

Johnson & Johnson (drug manufacturer): 20.8 percent

Pfizer (drug manufacturer): 16.3 percent

GlaxoSmithKline (drug manufacturer): 17.4 percent

WellPoint: 4%

 

I agree . . plenty of blame in big Pharm too . . . .but dont tell the current congressional minority that.

[Brentastic]

There is no doubt that there is some fat that needs to be trimmed in some of these for profit health insurers. The rate increase is absolutely exorbitant. That being said I always find it interesting that the insurers are always to blame. Nobody wants to put any blame on the pharmaceutical industry which I think is a mistake. Take a look at drugs used to treat Multple Sclerosis - Avonex has gone up 100% in 5 years and now costs 36k per year. New oral oncology drugs that don't increase overall survival but cost 60k-100k per year. I could go on and on but won't belabor the point. I'm not saying that insurers are blameless but there is A LOT of blame to go around here.

 

ETA Profit margins from the link above:

Amgen (biotechnology): Profit margin, 30.6 percent

Gilead Sciences (biotechnology): 37.6 percent

Celgene Corp. (biotechnology): 11.9 percent

Johnson & Johnson (drug manufacturer): 20.8 percent

Pfizer (drug manufacturer): 16.3 percent

GlaxoSmithKline (drug manufacturer): 17.4 percent

WellPoint: 4%

Very good point.

[dmarc117]

our drug plan changed big time. our insurer f'ing us on name brands.

[Yukon Cornelius]

its because of all the law suites.

[i_am_the_swammi]

its a ridiculous amount of cash we are talking about when $2.7B only equates to a 4% profit. That means their income was $67.5B.

[The Irish Doggy]

Methinks they won't be the major player in the market for long with 40% rate hikes.

[Piles]

our drug plan changed big time. our insurer f'ing us on name brands.

 

Did you change acutal insurers or just have a change in your benefit with your current insurer? A lot of times when you change actual insurers a claim file is not passed from the old insurer to the new insurer. Therefore the new insurer has no idea what medications you were on. Unfortunately, this can cause a lot of disruption for people who have been stable on certain medications with their previous insurer. I deal with this stuff everyday. Be more than happy to try and give you some insight on getting your meds covered - PM if you're interested.

[dmarc117]

Did you change acutal insurers or just have a change in your benefit with your current insurer? A lot of times when you change actual insurers a claim file is not passed from the old insurer to the new insurer. Therefore the new insurer has no idea what medications you were on. Unfortunately, this can cause a lot of disruption for people who have been stable on certain medications with their previous insurer. I deal with this stuff everyday. Be more than happy to try and give you some insight on getting your meds covered - PM if you're interested.

 

 

same insurer. now they have a tier system with drugs. different drugs make different tiers which cost more or less depending. co-pays are up for many of the name brands.

[Piles]

same insurer. now they have a tier system with drugs. different drugs make different tiers which cost more or less depending. co-pays are up for many of the name brands.

 

Ah, so a benefit change with your current insurer. Unfortunately, with a benefit change there is not a ton I could help you with. However, lots of times there are generic alternatives to brand drugs. If you are not averse to generics I maybe able to offer you some lower cost alternatives you could ask your doctor about.

[keggerz]

I have been taking a medication for almost a year now...it is a chemo drug that is mainly used to treat cancer but I don't have cancer but the drug is used to control my problem...Saturday I go to the pharmacy to pick up my refill and am told it was declined or something like that...the pharmacist made a call and took about 30 mins before he got approval to fill the script this one last time...he was given a phone number to give me...I called and the number was to an online pharmacy...i was like what the hel1...call BCBS(Anthem) today and find out that effective Jan 1st they changed my coverage or whatever and deemed the med I take as a specialty med and all specialty meds MUST be filled by this online pharmacy that they are evidently in bed with...complete and utter BS if you ask me....my pharmacy is about a 2 minute walk, yes WALK from my house but I know have to order online and have it shipped UPS next day or 2 day to me :shakeshead:

Edited February 17, 2010 by keggerz

[Piles]

I have been taking a medication for almost a year now...it is a chemo drug that is mainly used to treat cancer but I don't have cancer but the drug is used to control my problem...Saturday I go to the pharmacy to pick up my refill and am told it was declined or something like that...the pharmacist made a call and took about 30 mins before he got approval to fill the script this one last time...he was given a phone number to give me...I called and the number was to an online pharmacy...i was like what the hel1...call BCBS(Anthem) today and find out that effective Jan 1st they changed my coverage or whatever and deemed the med I take as a specialty med and all specialty meds MUST be filled by this online pharmacy that they are evidently in bed with...complete and utter BS if you ask me....my pharmacy is about a 2 minute walk, yes WALK from my house but I know have to order online and have it shipped UPS next day or 2 day to me :shakeshead:

 

Due to the high cost of "specialty" drugs almost all insurers are requiring that they get filled at specialty pharmacies. Curascript is the major specialty pharmacy in the country. Generally speaking they are willing to take less reimbursement than your community pharmacy. I do believe there is some legislation out there to ban any type of mandatory mail order benefits. I know it is being discussed in NY but not sure if there is any movement at the federal level.

[Perchoutofwater]

If insurance companies make such insane profits, what is keeping people from buying their stock rather than complaining about them?

[bpwallace49]

If insurance companies make such insane profits, what is keeping people from buying their stock rather than complaining about them?

 

A lot of people that are screwed over by them cant afford to buy stock because their medical bills are so high . . . . .

[millerx]

its because of all the law suites.

 

Sassi told Sebelius that insurance costs also continue to rise because medical prices are increasing faster than inflation, and people are using more health care. That use increase is driven by an aging population, new treatments and “more intensive diagnostic testing,” he wrote.

A LARGE part of the reason for this is that if they get it wrong they will get the pants sued off of them.

 

Not defendin', just sayin'...

 

it's just one of many overhauls that need to be addressed in healthcare reform.

Edited February 17, 2010 by millerx

[yo mama]

If insurance companies make such insane profits, what is keeping people from buying their stock rather than complaining about them?

People having a hard time affording health care premiums don't generally have loose cash to invest in the stock market. Let them eat cake, indeed.

[Chavez]

If insurance companies make such insane profits, what is keeping people from buying their stock rather than complaining about them?

The exorbitant premiums. Duh.

[keggerz]

Due to the high cost of "specialty" drugs almost all insurers are requiring that they get filled at specialty pharmacies. Curascript is the major specialty pharmacy in the country. Generally speaking they are willing to take less reimbursement than your community pharmacy. I do believe there is some legislation out there to ban any type of mandatory mail order benefits. I know it is being discussed in NY but not sure if there is any movement at the federal level.

I straight up asked if that was why and was told no it wasn't....I was also told that my drug isn't that expensive ($140ish I think)...it is a generic called Mercaptopurine (50mg tablets)....I am waiting for them to get back to me tomm. because I am not giving up without a fight...i cant remember the name of the online pharmacy but it isn't the one you listed....I wouldn't have as much of a problem with it if I was at least given a couple of choices of online pharmacies to use but that isn't the case and I think it absolutely sucks.

Edited February 17, 2010 by keggerz

[Perchoutofwater]

A lot of people that are screwed over by them cant afford to buy stock because their medical bills are so high . . . . .

 

 

People having a hard time affording health care premiums don't generally have loose cash to invest in the stock market. Let them eat cake, indeed.

 

 

The exorbitant premiums. Duh.

 

If the profits are so insane and practically guaranteed why not take out a loan to purchase the stock. Rates on a 5 year balloon note are very favorable right now.

[yo mama]

If the profits are so insane and practically guaranteed why not take out a loan to purchase the stock. Rates on a 5 year balloon note are very favorable right now.

[Perchoutofwater]

 

Just trying to show how asinine the statists continual attacks on the insurance companies are. Yes some reforms are needed, but to try to lay to cost at the feet of the insurance companies are laughable.

[westvirginia]

Just trying to show how asinine the statists continual attacks on the insurance companies are. Yes some reforms are needed, but to try to lay to cost at the feet of the insurance companies are laughable.

 

+1

 

The quickest way to get costs down is to remove the disconnect currently shielding consumers from the cost of their HC. Right now they have absolutely no incentive to save, since they only have an $X co-pay and their insurance pays for the rest. Give Joe Public the same tax break that business gets and soon the link between employers and med insurance is gone. Once people have to see it/take care of it themselves they'll become cost conscious.