• CNN: There are tradeoffs to Obamacare

    I tweeted this morning:

    In related news, insurance companies have always had limited networks. It’s one way they hold costs, and premiums, down. It’s an “expected” effect of Obamacare. If we don’t like that, we should change it. But then, we should expect to pay more.

    This was the topic of my latest column over at CNN.com. Go read.

    @aaronecarroll

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    • Health care is expensive because it is overpriced. I look at prices on the exchanges and gasp. I live overseas and have expat health insurance from Aetna. It’s half the price I’d pay if I lived full-time in the States and twice what I’d pay if I bought world-wide coverage excluding the US and Canada.

    • It’s not often discussed anymore, but “any willing provider” state laws were the big thing not many years ago with the expansion of HMOs. I’m curious whether we will have another round of lawsuits seeking to overturn “any willing provider” laws. For those not familiar, “any willing provider” laws require health plans to include any physician willing to sign the plan’s contract to be included in the plan’s network. ACA (the Harkin Amendment) includes an “anti- any willing provider” provision (section 2706(a)); that’s my characterization, not everybody’s. The scope of the provision, however, is unclear (or it’s unclear to me), and that is fertile ground for lawsuits.

    • You’re not alone. It’s distressing.

      BTW, thanks for opening the Facebook storefront.

    • This is what I consider one of the missed opportunities of the ACA — better incentivizing larger networks that are more easily compared and used. The ACOs seem to be one attempt to deal with this, but they’re voluntary and I’m not sure they’re effective.

      But it’s likely that someone could come up with a solution that expands networks and does not make us “expect to pay more”. In the same way that expanding the insured population could (at least in theory — much ink has been spilled I know) lower overall costs, expanding networks and inciting provider price and quality competition could work similarly. That just doesn’t seem to have been the focus of this round of the reform.

      • All-payer rules would effectively make every insurance plan’s network every provider. Japan uses these to great effect and benefit, and Switzerland, Germany, the Netherlands, and France do as well. Maryland has had an all-payer system in America for many years. It may not bend the cost curve, but it absolutely would eliminate price discrimination and allow patients to seek whatever providers they wanted with no worry about networks whatsoever.

    • Being covered by the 600 lb. gorilla (largest employer and therefore largest provider of healthcare coverage) has its advantages in that almost every medical provider in the area will accept it and most are considered in-network. Choosing to utilize an out-of-network provider means that the difference between what an in-network provider accepts and what the out-of-network provider charges is billed to the patient.

      There are restrictions in some other areas for providers of expensive services like MRI, colonoscopy etc. If you choose to utilize a provider other than the preferred one, there is a surcharge.

      You still have a choice but yes, there is an added cost.

    • Another consideration for the “surprised” news stories about limited networks on the Exchanges: in almost every state there will be a range of network sizes among plans. The cheapest ones will tend to have smaller networks, but there will also be wider network plans available. No one, of course, is forcing people to choose a smaller network over a larger one that costs more money. When push comes to shove, and employers aren’t making purchases on people’s behalf, the majority of people prioritize lower cost over wider network. This is the market at work.

    • I think one of the problems, however, is that these plans are being outed by HHS as “low-cost, high quality” plans without properly explaining the tradeoffs to consumers. When you hear that you can get a plan for as little as $XX per month, that’s highly misleading. I get that they’re doing this to draw people into the exchanges, but you can’t fault the media for being “surprised”. They are pointing out something that I think is poorly understood among the general public and that’s a good thing.

    • Many of the ugliest bankruptcies due to health care arise from an outrageous billing from a non network provider.

      This is not terribly hard to solve. It needs some tough national laws such as the following:

      a. In dire emergencies, charges cannot exceed the Medicare fee schedule — from any hospital or any surgeon.

      b. For scheduled care, the patient has a legal right to demand a cost estimate in plenty of time before the care occurs.

      If the estimate is not provided, the provider has no right to collect any more than the Medicare fee.

      c, In disputed cases, the provider must accept what the insurer pays them, assuming that payment at least equals the Medicare fee schedule.

      d. All existing medical debts due to out of network charges are legally forgiven.

      The wealthier doctors and hospitals will fight all of this, but too bad

      Bob Hertz, The Health Care Crusade