Stories of disruptive healthcare innovators and the new movement to restore medicine to its primary mission to help people
BY PHIL CALHOUN- CALBROKER PUBLISHER
“The Price We Pay” explains why healthcare expenses in the United States are out of control and how individuals are trying to reform how healthcare is fundamentally organized so that patients come first, and profits come second. This includes the high expense and transparency of hospital treatment, doctors doing unnecessary operations, and the fact that insurance brokers, pharmacy benefit managers, and group buying organizations do not assist the clients they serve but gain from the income they get. For many reasons, healthcare insurance has been skyrocketing; Dr. Makary explains the money games of medicine, loaded with middlemen, kickbacks, and hidden costs, because we don’t have malicious leaders in the healthcare industry.
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“The Price We Pay” offers a road map for everyday Americans and corporate leaders to negotiate a better deal on their health care, and profiles disruptors who seek to change the problems with medical care. According to Dr. Makary, there is a strong movement to return medicine to its original purpose. His goal is to restore public confidence and protect our nation from the skyrocketing expense of healthcare. Health insurance professionals can benefit from the points made by the author. First, anybody trying to figure out new methods to improve healthcare prices, access to care, deal with fraud and abuse, will learn from Dr. Makary’s insights and street level research. The polarizing political environment is not a solution as he notes getting the government to do anything is getting harder and harder. Second, Dr. Makary reminds us that awareness alone may spur innovation and transformation. As advocates for our clients, we are now how the industry often pushes people around. His focus is on individual challenges fighting large systems such as hospitals and insurance carriers. Regarding the author’s comments about the uninsured, this is why I wanted to include California statistics not included in the conclusions in the book. To be fair, the focus is on systemic problems at a national level.
The following section is my review of California issues with health insurance.
- As health brokers we know the uninsured population has been reduced in California. We have an individual mandate that requires Californians either have qualifying health insurance, or pay a penalty when filing their state tax return unless they qualify for an exemption. Therefore, in most cases a hospital bill is covered at least in part by insurance. Evidence of this is how hospitals write off millions in unreimbursed medical services delivered. Hospitals do work hard to get patients enrolled into Medi-Cal when they access hospital services. The undocumented uninsured population continues to be a source of uncompensated care.
- In California, the eligible but uninsured population stands at approximately 1.7 million. These uninsured legal residents are eligible to apply for coverage through MediCal or Covered California. MediCal enrollment is currently at 13.4 million in our state. Without including ineligible undocumented persons residing in the state, the uninsured eligible percent of the total population of 39 million is 5%.
- In 2022, the push has been enrolling more people into Medi-Cal, as the monthly income for a single adult will increase to $1,564. In other words, an adult can earn up to $1,564 per month and still qualify for no cost Medi-Cal. Health insurance enrollment in California increased in 2020 by over a million enrollees, due to growth in Medi- Cal managed care.
- A continued push to keep people insured is the insurance subsidy changes as those with higher incomes can often qualify for subsidized premiums for Covered California plans. And older adults can qualify for subsidies that younger adults cannot, given the same metal tier plan.
- The Affordable Care Act requires insurers to spend a minimum share of premium dollars on medical care or pay a rebate to consumers. In 2020, California insurers owed $95 million in rebates.
The top eight carriers in California equal 90% of the total market.
- Nearly 1.9 million eligible Californians will remain uninsured in 2022, or about 5% of the population age 0-64. The highest uninsured rates are undocumented Californians (65%).
Additional points on what happens to medical costs for the uninsured
- 80% of healthcare providers’ uncompensated care costs are paid by government payments designed to cover these costs.
- The remaining share of uncompensated care (about 20%) is covered by private sources, provider charity, or transferred to other payers in the health care system.
- About $8.8 billion of uncompensated care costs are not covered by public While some of this may be accounted for by public sources but those amounts are small.
- Private funding sources (e.g., workers compensation, provider charity and philanthropic organizations), may also cover some of the residual share.
- Additionally, taxpayers cover the cost for uncompensated care through MediCal or with annual insurance premium increases. The privately insured population assumes some of these costs through increased health insurance premiums.
Dr. Makary points out that some hospitals and doctors are overbilling as they attempt to compensate for low or no payment from the underinsured and uninsured. He takes aim at health care providers who commit billing excesses and fraud and calls for a movement to demand change, which is commendable. The extent of fraud and abuse he reveals is staggering. Dr. Makary and his research team have made a significant impact on hospitals and physicians to influence change from practices which are not patient focused but profit driven.
In summary
“The Price We Pay” is a solid look at the healthcare industry. As health insurance professionals it is clear we can be part of the solution. The author has many deep reviews of the industry which are lessons health insurance professionals need to be aware of to help clients navigate the industry. When we support our clients and our professional associations, we rise to a higher level. Individually we may only make a small impact but collectively we can influence politics and issues through numbers. As we move forward as difference makers in the industry, we can do more by working together to defend our critical role in the industry as educators and client advocates.
MARTY MAKARY is a professor at the Johns Hopkins School of Medicine and Bloomberg School of Public Health. He is author of the New York Times bestseller, “Unaccountable.” A leading voice for physicians in The Wall Street Journal, The New York Times, and USA Today, Dr. Makary is editor-in-chief of Medpage Today. He currently serves as chair of the advisory board of African Mission Healthcare. He lives in the Washington, D.C. area.
PHIL CALHOUN is co-owner of Integrity Advisors and publisher of CalBroker Magazine. Contact 1 (714) 664-0311