Regence Blue Cross, stifle your premium increase platitudes

Every year I look forward to reading Regence Blue Cross' "Re: Your Annual Plan Renewal" letter. Not because I like the news about how much more money they'll be sucking out of our checking account every month.

No, I enjoy seeing what half-assed excuses our health insurance provider came up with this time to justify their exorbitant premium increase.

For 2006-07, it was 12.5%. For 2005-06, 11.8%. Inflation has been running around three percent, right?. So how does Regence explain the extra 9% or so?

Pretty poorly.

The cost of health care – hospitalizations, doctors' services, prescriptions, diagnostic tests – continues to rise.

Wow! Thanks for the news! You've been charging us from 10% to 20% more each year for as long as I can remember. I already know the cost of health care is rising, thanks to your absurdly high premium increases. Try another reason.

As we grow older, our costs of care increase. These costs are reflected in changes to premium rates by age group.

OK, this helps explain some of the rate of increase. But it doesn't answer my big question: "Why the hell does it cost us two generally healthy and fit late-50 year olds $603 a month for a middling generous insurance plan?" Other countries can do it for a lot less.

Well, Bonnie Hass, Director of Customer Service, didn't explain that her salary, along with the thousands of other worker bees in the Regence Blue Cross administrative hive, none of whom provide an iota of actual medical care, are the biggest reason why the United States health system is so horribly costly and inefficient.

Physicians for a National Health Program lays out the facts concisely.

The U.S. spends twice as much as other industrialized nations on health care, $7,129 per capita. Yet our system performs poorly in comparison and still leaves 46 million without health coverage and millions more inadequately covered.

This is because private insurance bureaucracy and paperwork consume one-third (31 percent) of every health care dollar. Streamlining payment though a single nonprofit payer would save more than $350 billion per year, enough to provide comprehensive, high-quality coverage for all Americans.

Bingo. The real reason our Regence Blue Cross premiums are so expensive is Regence Blue Cross itself. Along with all of the other insurance companies whose only reason for existence is to serve as an unnecessary middleman between health care patients and providers.

It's depressing to realize what a mess this country's health care system is in. Fortunately, now there seems to be more of a genuine commitment to fixing things, both on the state and federal level.

If the Democrats can maintain political control here in Oregon, and we get a Democratic president come November '08, I'll be feeling better about what we'll be paying for health care for the rest of our lives.

Until then, Regence Blue Cross says they're looking out for me – and all the other plan subscribers who get their "Your Annual Plan Renewal" letter and react with a Holy @#$%&!

We also recognize the importance of emotional health for our members and added support for depression and anxiety to these same plans.

Thanks, Ms. Hass. That's kind of you. However, what I really need to relieve my anxiety about what we're paying for health care is a single-payer health system for the United States.

That way I'll never have to read another of your rate increase letters again, which aren't good for my emotional health.

Comments

[Rain]

i am for it-- single payer and cut out the middle men that do nothing but gather money. Boy will we hear yelling though!

[Ryan Johnson]

First, I work for a very large health and benefits consulting firm and the increase you are seeing from Regence is not any different than other insurers that are experiencing double digit medical inflation, nationwide.

You are right about the bureaucracy that exists in the healthcare industry, but government (single payer) is not the solution, it is the problem. If you think that the government could control medical costs better than private insurers, than you may need to do a little more homework. Look at Medicaid - there are several published statistics that show just how much money private insurers can save states over a 100% state run fee-for-service healthcare program. The very same goes for Medicare+ Choice programs. These insurers exist because the governmetn already could not handle it. Putting everything back in the hands of the government would be a disaster and a big step backward. You are comparing the U.S. to other countries - there are some serious trade-offs that you would experience if we moved to the same system as other countries.

The real issue (and giant elephant in the room) is that people expect "free" healthcare. People have NO idea of the cost for healthcare services. Ask someone the price of gas or the price of a new Honda Accord, 9 out of 10 people would get it right. Ask the same people how much they would pay for a physician visit or one day hospital stay and they will tell you "$10 - that's my copay." Until people begin to become better educated and better consumers of healthcare and the government and private insurers stop subsidizing healthcare costs, you will continue to see huge healthcare increases. Americans are unique. We don't want to ration care. We want it all. That is why we spend so much and get less in return than other countries. Other countries understand rationing - that is the only way a single payer system works. We shouldn't have to ration. Rationing is just not something that a free-market society should have to endure. But, that is what a government run society requires.

So what would happen if we move to a single payer system? People will use more healthcare services (since they are perceived as "free"), you will start to see and even bigger bureaucracy formed and double digit increases on your taxes earmarked for healthcare spending. If you don't believe me, keep an eye on Massachusetts over the next couple of years and watch their state healthcare costs spiral. They implemented universal care and it ONLY worked because they got a sweetheart deal from the Feds (in other words, we are all footing the bill for MA) and they only had 10% uninsured to begin with.

There are several good papers that have been writen on this subject that suggest that without some sort of disruptive innovation in healthcare (as happened in the computer industry), we will never have affordable care. Either way, we are very close to push coming to shove. With Healthcare costs currently at 16% of GDP and projected to be at 20-25% of GDP over the next 10-20 years, something will have to give. Healthcare reform will be required soon.

For what it is worth...

[Idler]

Ryan,

Could you cite a couple of those articles?

[gavigan]

Erm, I lived in the UK recently (for a couple of years) and used NHS regularly. I'd happily take their shorter doctor's appointments (20 minutes) and longer lines for some treatments because my preexisting condition wasn't a liability there. What was it instead? A reason to get all related medications FOR FREE, FOR LIFE. I'd suggest you spare me the "other systems have problems, too," Ryan, until you've been through the hell of being rejected for medical coverage at 26 because of an autoimmune disorder you can't control...and it's not just me. My friend? Same age, diagnosed with endometriosis: rejected by three companies.

I experienced the best and worst of NHS. I'll still take it over our system, any day of the week.

[Pat Heller]

Rain- I agree with your synopsis and I know what gavigan says about being rejected by insurers is true-so what do we do here in America? Eliminate government spending first, cut government programs and salaries, tort reform, severe penalties for fraud in the delivery systems, personal responsibility, cut administration costs by the carriers- are agents necessary anymore with the internet? I'm one, and I don't think so although it is nice to talk to a human once in awhile. I don't know what the answer is- somewhere between the radical, socialistic bent the president is on and the extravagant, bloated system we have now. I know I don't want the 1% tax imposed on my premium by the passage of HB2116 (UNBEKNOWNST TO ME)for a plan I didn't create and don't support.

[dan nicol]

If you are an individual Regence subscriber in OR, male sure you go protest the latest Regence 22% hike proposal to the State here:
http://tiny.cc/comment-regence

I am tired of paying higher premiums, seeing my coverage lowered and my deductible increased with our Regence individual plan. Both my wife and I work at companies too small for group insurance and we are seriously considering taking the whole family off insurance. Is it really making sense to pay about 10,000 for insurance yearly for healthy family of 3???!

Utterly unacceptable: See related news http://www.nytimes.com/2011/05/14/business/14health.html?partner=rss&emc=rss