The Cost of Obesity in the United States

According to McKinnsey, it is $450B:

http://www.mckinseyquarterly.com/newsletters/chartfocus/2011_01.htm

Concerns About HHS' Role in Rate Review

As I noted in a previous post, HHS has determined any increase in the small or individual market 10% or more as unreasonable and therefore subject to review. Will this cause issues for health insurers? This article discussews the possibilities:

http://www.kaiserhealthnews.org/Stories/2011/January/20/insurance-mandate-health-law-repeal-expert-QA.aspx

Alternatives to the Individual Mandate

Of all the provisions of the ACA, the one that attracts the most attention and opposition is the individual mandate. Is there a better alternative? This article provides some ideas:

http://www.kaiserhealthnews.org/Stories/2011/January/20/insurance-mandate-health-law-repeal-expert-QA.aspx

My biggest concern w/the individual mandate is that many people will ignore it and just pay the minimal penalties for doing so.

What Are Essential Benefits? AHIP Weighs In

The IOM held a three day meeting to define essential benefits for a health insurance policy. AHIP provided its own perspective of what the definition should look like.

The health insurance lobby urged federal advisers against recommending specific "essential" items or services that must be included in health plans offered on new insurance exchanges starting up in 2014.

The 10 general categories of benefits outlined in the reform law already specify an "appropriate set" of items or services that should be included in the essential health benefits package, America's Health Insurance Plans said in Thursday written testimony to the Institute of Medicine (IOM).

"Other programs, such as the Federal Employee Health Benefits Program and the Massachusetts Exchange, generally use a consistent model in which the benefit package only specifies general categories of items or services and does not indicate number and frequency of services that should be covered," wrote Carmella Bocchino, executive vice president of clinical affairs and strategic planning for AHIP.

AHIP's comments were considered in the middle of a three-day IOM meeting as the body prepares recommendations to the Department of Health and Human Services on essential health benefits.

The health insurer advocate also said the essential benefits package should not have the effect of forcing individuals and small employers to purchase a richer scope of benefits than what is currently available today.

"Broadening the scope of the essential health benefit package could have the unintended consequence of making products unaffordable and thereby limit access and consumer choice," Bocchino wrote.

The group also strongly urged against requiring plans on the exchanges to comply with state mandates. AHIP said more than 2,000 state mandates currently exist.

Can CO-OPs Be Viable?

The ACA has allocated $6B for the formation of not for profit CO-OPs to compete with health insurance companies. What are the requirements for these entities?

• Organizations qualified to participate in the CO-OP program are those that are organized under state law as nonprofit, member corporations.

• Priority will be given to plans that operate on a statewide basis, utilize integrated care models, and have significant private support.
• The governance of the organizations must be subject to a majority vote of its members and the organizations are required to operate with a strong consumer focus, but they are not consumer-owned.
• Profits must be used to lower premiums, improve benefits, or to finance programs aimed at improving the quality of care to its members.
• Any health insurance issuer that existed prior to July 16, 2009 may not qualify for the CO-OP program.
• Grant or loan recipients under the CO-OP program are restricted from using the funds for marketing activities.
• Representatives of federal, state, or local governments as well as representatives of insurance issuers that were in existence on July 16, 2009 cannot serve on cooperative boards.
• Cooperatives may establish private purchasing councils that may enter into collective purchasing arrangements for items and services. But the councils are precluded from setting payment rates for health care facilities or providers that are participating in health insurance coverage provided by the plans.
• The secretary of HHS is precluded from participating in any negotiation between cooperatives, or a purchasing council, and any health care facilities or providers including drug manufacturers, pharmacies, or hospitals. The secretary may not establish pricing structures for reimbursement of health benefits provided by the qualified health plans.

Group Health Cooperative in Seattle is a good example of a present not-for -profit cooperative. It presently serves 500,000 people.

What Will the Blues Do w/Their Excess Capital?

Lower prices? Invest in IT?

http://www.aishealth.com/Bnow/hbd011011.html

The Battle Over ACOs

Here is a good article that describes how the different parties in health care are lining up over ACO regulations:

http://www.kaiserhealthnews.org/Stories/2011/January/10/doctors-hospitals-accountable-care-organizations-rules.aspx

Insurers concerns?

Insurers are helping to drive the fight over financial incentives as they push CMS to place a tighter rein on ACOs. They are fearful that ACOs will try to make up lost revenue from Medicare by charging privately insured people more or coaxing them to get more treatments. Insurers also worry that ACOs will give doctors and hospitals more power to set health care prices in the private market, and are resisting providers' requests for the government to loosen anti-trust rules.