12/13/13 Insurers Strongly Encouraged

Let me get this strailarge_brando3ght. In the continuing effort to fix things, Health and Human Services (HHS) has strongly encouraged insurers to do the following things:

1. Pay claims for folks who have not yet purchased health insurance by paying their premiums.
2. Treat out-of-network health care providers as if they were in network.
3. Pay for prescription drugs that are covered under someone’s old (now canceled) plan that are not covered under the new plan.

Since this will be for a limited period, if this is implemented and the strongly-encouraged insurers comply, it is likely that the net result will be nothing since beginning January 1, 2014, everyone on an ACA offered policy will be in their full deductible period, so everything will come out of the consumer’s pocket anyway; thus, insurance companies are being strongly encouraged to comply a substantive nothing that only seems to be something.

And what about the out-of-network health care providers? Since they will be treated as in-network, does this mean that they will be strongly encouraged to accept payments lower than they were willing to accept, which is one of the main reasons they excluded themselves from the network? The reports I have read did not say that they were being strongly encouraged to do anything, so does this mean that they will be reimbursed at their higher rates or forced to accept the lower ones?

Many of the out-of-network health care providers are out-of-network simply because they were excluded by insurers in an effort to control costs. Some of them may have wanted to participate but were not allowed. The plans I have examined under the ACA forces people to obtain health-care from in-network providers that are listed as being within their geographical area. Nearly all of the top-flight research and advanced care facilities (MDAnderson, Mayo Clinic, Cleveland Clinic, Johns-Hopkins, etc., and likely the University Medical Centers in your own state) are excluded. Are they being strongly encouraged to participate or are the insurers merely being strongly encouraged to include them?

I can’t speak for all the plans around the country because I have not examined them, but the solitary choice here in much of Mississippi, Magnolia Health Plan, excludes many drugs that are now the standard of care for chemotherapy for cancer patients. They exclude Rituximab which is a key leg of the triad of chemotherapy for Chronic Lymphocytic Leukemia called FCR. The R stands for Rituximab. (F=Fludarabine; C=Cyclophosphamide). FCR is not a new, experimental chemotherapy, it is the standard for the last several years, used worldwide. Anything less is, well, something less: less expensive but far less effective. The other therapies have been largely relegated to history. You cannot have FCR without the R, and the R, being expensive, is excluded from coverage, meaning that one would have to pay 100% of it out of pocket. It is between $6,000 and $12,000 a pop, depending on the size of the effective dose for your physical size, where it is purchased, and what discount is being offered on it. Since it is not a covered drug, there is no negotiated discount between the provider and the insurer. Does this mean that health care providers are being strongly encouraged to be reimbursed at rates they are unwilling to consider, or that insurers are being strongly encouraged to pay rates they have not been willing to consider. How will this work? The entire process is very awkward to begin with, and now awkward seems far to tame a word.

As I said earlier, it won’t matter much, since these strong encouragements are temporary, just for the first month or so of 2014, when people are still likely to be 100% within their deductible period, or so HHS claims. The track record of the veracity of what HHS claims is not very good. Since this is the functional equivalent of nothing, is it so HHS can say, “Well, we strongly encouraged insurers to cover these things, but they refused, those evil insurers?” I think HHS is looking for a scapegoat, and the insurers, who were willing participants in this government-backed guaranteed insurance program are now being strong-armed by the government that promised them a lot of unearned business. This is government, not market, control.

“I would strongly encourage you to do these few simple things for your government and the people,” said Don Corleone III., the new Secretary of Health and Human Services who replaced the embattled Kathleen Sibelius, to the heads of various insurance companies seated at the table. “It is for your own good in the long run, and good for the nation. We cannot continue to profit from this without your cooperation.”

The executives at the table, looking sort of like rats caught with their foot in a trap, looked about as if hoping to find an exit, but Vinnie and Guido were astride the door, arms folded with one hand inside their coats, looking stern as stern can be with slight nods towards the Don. There was not the slightest bit of humor in their gaze.

“Don’t worry,” said Corleone with a gesture towards the door. “I have put Vinnie and Guido in charge of assisting you in any way they can to make sure that this works for us all. At this moment, we are rounding up field assistants who will report to them, and they report to me. Should you have any difficulties understanding why this is in your best interests, they will be able to properly explain it to you.” The insurance executives all smiled nervously, looking at Vinnie and Guido, who, still not smiling, just nodded their heads.

“Of course,” continued Corleone, “We cannot order you to do these things and are relying on your complete, willing cooperation, but we are strongly encouraging you to be creative in coming up with ways to provide us with these few simple things, for the benefit of us all. Since we plan to rescind these extra benefits before anyone is able to meet their deductible, it should be no real cost to you, and if it is, we will ensure that all willing participants will be amply rewarded for their loyalty. This will make us all look good”

Everyone understood what was not being said. Everyone knew what being “strongly encouraged” meant. There were still a few lingering questions though, particularly about how the insurers were going to get the health care providers to participate. One nervous insurance company president spoke up and asked the question, but nearly wet his pants as Vinnie and Guido looked directly at him.

The room was dead silent for a moment as all eyes were on Corleone, except for the cumulative total of the four eyes belonging to Vinnie and Guido, which were piercingly upon the one who dared speak. Corleone then looked at him too, for a long time, seemingly an eternity…then he smiled.

“That is an excellent question,” he said. “Some of Vinnie and Guido’s men are at this moment consulting with the major health care players, trying to persuade them that this is all in their own best interests. We may have a bit of give and take in our negotiations with them to get them to go along, but ultimately we plan on making them an offer they can’t refuse. I think you will find the big boys very compliant. One the big boys are in, the little guys will have no choice but to come along with us.

“It’s critical for the success of the venture that we are not the ones to look bad. We must always be seen as the advocate of the people. You guys may take a little heat for a while, but you agreed to play, now you must pay. We’ll see that it gets made up to you in the long run. Trust us.”

With that, the meeting was finished, and everyone stood up and shook the hand of Don Corleone, who remained seated. Vinnie and Guido, saying nothing, did not offer their hands, parting only slightly so that the executives had to line up in careful single file to exit the conference room.

After they were gone, Vinnie asked his boss, “Think it’ll work?”

Corleone looked at him, scratched his chin, and replied, “How could it not? We have all the assets we need to make sure that everyone gets what is coming to him. Oh, yes! It’ll work and work well. Of that, I have no doubt. After all, it is in their own best interests.”

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