Jun
29
Market Competition: American and International insurance
Filed Under Health Insurance, Healthcare, Income Protection, International Healthcare, Medical Insurance, USA Health Insurance | 1 Comment
Despite the fact that recent polls show approximately 72% of the American populace are in favor of a government-sponsored health insurance plan and the common sense idea that sooner would be better than later, the legislative leaders of the country seem to have instead let the discussion drift into politics.
Various Democrats have proposed plans either involving a public plan, an individual mandate to force people to buy insurance (probably with some form of government subsidy), or some kind of reform with a “trigger”, whereby if the market for health insurance does not rectify itself within a period of time then a public plan would be introduced. On the flipside, Republicans leaders have put forward a plan for health insurance reform which, to be fair, is somewhat less than substantive as it does not include any numbers or data.
While most of Washington has been consumed by the bickering, not all have been sitting on their hands. After an investigation by the New York attorney general’s office as well as a congressional investigation, it came to light that American insurance companies have been using a database run by Ingenix, a subsidiary of managed health care company UnitedHealth Group, that allowed many American insurers to routinely underpay U.S. doctors and hospitals for out-of-network care administered to American patients, ultimately saddling average Americans with the remainder of the costs. A separate congressional hearing has landed some insurers in hot water over the practice known as recission, where they have revoked some individuals’ coverage based on medical history after the individuals’ had already paid their premiums.
The Ingenix database worked by taking claims data submitted by its customers, the insurers, and developing payment rates for out-of-network medical services. Here’s the rub, the insurers were found to have been cleaning up their claims data before sending it to the database by removing many high costing data points. Ingenix itself would then use highly suspect statistical analysis to arrive at rate estimates for how much insurers should pay for medical services provided by medical facilities not in their insurance networks. The end result being that the reduced cost of the initial data, along with statistical tweaking, forcibly and falsely pushes down the amount they have to pay on a claim and also increasing the amount the patient has to pay out of pocket.
On top of all this, Americans are paying more than ever for health insurance and health care. A report from the U.S. Department of Health & Human Services shows that not only are rising premiums a concern, but deductibles, the amount of money you must pay for medical expenses before insurance covers the rest, and copayments, the amount of money you pay each time you see a doctor, have also risen steeply over the years. Average deductibles for families have risen in price by 30% over two years and the number of people with employer-based insurance and copayments over US$25 rose from 1 in 5 to 1 in 3 between 2004 and 2008. So what exactly is wrong with local American insurance policies that are causing such problems?
One reason is because of the way the U.S. health insurance market is set up to begin with. Because each state is entitled to a large amount of self-governance, there are, in effect, 50 different markets, each one is its own particular mishmash of state and federal rules, and each one quite distinct from the others. In and of itself this isn’t a problem, however, it does make it easier to gain a majority of market share. A recent report shows that there have been 400 mergers involving health insurance companies in the last thirteen years. The result of this has been that 94% of American statewide health insurance markets are now considered “Highly concentrated” by U.S. Department of Justice guidelines. By the aforementioned guidelines, a market can be considered as “highly concentrated” if more than 42% of the market’s share is controlled by one company. Experts have noted that healthy competition in the market place is a key way of keeping costs and premiums down.
Thankfully, this is not a problem for companies providing international insurance policies. As we saw earlier, local American policies, much like local health insurance policies everywhere, are restricted in their choice of medical facilities and doctors based upon the insurer they have and the network of medical facilities that will accept their coverage. Most international health insurance plans do have two areas of coverage, one being worldwide, and the other being worldwide excluding the U.S., due to the fact that the cost of health care in America is so high. Still, international health and medical insurance plans will generally afford you access to any hospital or doctor of your choice and pay your claim up to the limits of your policy. Even a policy excluding coverage in the U.S. will often provide emergency coverage if you are traveling through the country.
The fact that the vast majority of international health and medical insurance plans’ give you access to global network of participating medical facilities means that insurers have access to similar networks and must work for market share through offering products that compete through benefits and costs. This keeps down the price of premiums as well as out of pocket costs like deductibles and coinsurance.
The constant competition for customers in the international health insurance marketplace means that customers are as important to insurers as the insurance is to the customer. In order to provide products that are attractive to customers over the long term, international health and medical insurance plans are community rated and guaranteed renewable for life. Being community rated means that each age groups’ premium is based upon the average cost to insure the most average of people. Basically, should you develop a costly or chronic condition, you are guaranteed to be able to renew your insurance for the rest of your life if you wish, without having your premiums raised significantly every year due to your claims history.
While local health insurance plans in America and elsewhere may initially appear cheaper, often times they end up being cumulatively more expensive as people age or if they fall seriously ill causing their premiums and out of pocket costs to rise. Because of a more fluid, open market in the international health insurance industry, the inflation of insurance costs to consumers is kept down and plans have become more competitive over a longer period of time.
Jun
19
Swine Flu Update: Going Pandemic
Filed Under Healthcare, International Healthcare, Swine Flu | 6 Comments
On the 11th of June, the WHO Director-General Margaret Chan announced that after a careful review of the available data and much discussion among both experts in the area and public health officials they have decided to raise the influenza pandemic alert level from phase 5 to phase 6, although the severity of the pandemic has so far only been assessed as moderate.
For those of us not well versed in buzzword bingo, what exactly does that mean? Well, influenza pandemics are divided into 6 phases; the first three phases are generally associated with preparedness to deal with an outbreak as well as response planning. Phases 4 through 6 are aimed at signaling the need for appropriate responses to an outbreak and also mitigation efforts. Phases 1-3 are indicative of animal infections and few animal-to-human infections, phase 4 means that sustained human-to-human transmissions have been observed and phases 5 and 6 relate to widespread human infections. To be specific, phase 5 is typified by the observed spread of the virus by human-to-human infections into at least two countries within one WHO region, warning that a full pandemic may be looming on the horizon. Phase 6, which is currently in effect, means that there is a full pandemic going on and is characterized by community level outbreaks of the virus in a country in a different WHO region in addition to phase 5 criteria.
So at the moment, our world is in the midst of a global pandemic where swine flu, also known as Influenza A(H1N1), is being communicated from person to person in multiple countries in various regions of the world, 
so of what importance is it when they say the pandemic is only of moderate severity? As it turns out, quite a bit. The moderate assessment is based on three things: firstly, most people recover from the infection without the need for medication or hospitalization; second, while there have been high prevalence rates in some local areas and institutions, the national level of infections are no greater than local seasonal influenza infection rates; finally, while a few medical facilities around the world are being stressed, the vast majority of hospitals and healthcare systems are coping well with the number of patients coming in. As of June 17th, there were a documented 39,620 cases in over 75 countries worldwide with only 167 reported deaths, it is important to keep in mind that the WHO may revise their assessment of the pandemic based on a number of things, including changes in the virus and the limitations of healthcare systems around the world.
In other swine flu related news, Brazilian scientists have noticed a new strain of the virus. Agence France-Presse reported on June 16th that after examining samples from a patient in Sao Paulo and comparing it with a sample of the A(H1N1) virus from California, a team of virologists at the Adolfo Lutz Bacteriological Institute isolated the genetic sequence of a variant of the virus, naming it A/Sao Paulo/1454/H1N1. Apparently the mutation in the virus is made up of changes to the specific protein which allows the virus to infect new individuals, raising concerns that the new strain may possibly be more aggressive than the current strain although it is unknown at the moment.
Normally influenza infection rates die down in the summer as the virus doesn’t cope so well with the increased heat. However, United States health officials are warning that because this year’s spring was especially cool and long, the country could experience a year-long flu season where infection rates are low in the summer and then pick up as summer turns to fall. A possibly more worrying piece of news is that there seems to be a large number of infections in healthcare workers in the United States because they haven’t been taking proper precautions with patients. A doctor from the U.S. Centers for Disease Control and Prevention (CDC) has said that patients coming into American emergency rooms need to be checked for flu symptoms and healthcare workers need to wear gloves, masks and eye protection when working with possibly infected patients, as infected workers may transmit the virus to other vulnerable patients elsewhere in the hospital.
On the lighter side, due to heightened awareness of a possible flu pandemic after the bird flu outbreak in Hong Kong 12 years ago, more funding and attention has been funneled into vaccination efforts and numerous pharmaceutical companies have begun work on a swine flu vaccine for the A(H1N1) virus already. A number of companies including Baxter International, CSL Ltd., Chinese company Sinovac Biotech, Novartis AG and Sanofi-Aventis SA are all working on vaccines. Sinovac has said it can finish clinical trials by the end of July, while Baxter indicates it could be able to start filling orders for a vaccine next month. Most companies are expected to make a vaccine available around the autumn time. Sanofi-Aventis has said that it will donate 100 million doses of it’s vaccine to the WHO in order to ensure that poorer countries have access to the vaccine during the pandemic. On the other hand, Novartis, the Basel, Switzerland based country has previously decided that it will not donate vaccine doses to the WHO and is instead looking at a tiered system of pricing to make sure that both rich and poor countries will have access to the company’s vaccine.
During this time it is important to take care of yourself and those around you. Make sure that you wash your hands frequently and if you feel flu-like symptoms, be sure to wear a mask and make a visit to the doctor as soon as possible. If you develop symptoms, or otherwise think you may have contracted the virus, please do not go to work, school or crowded places, avoid contact with others and be sure to cover your mouth with a tissue when coughing. If a tissue is unavailable cover your mouth as much as possible with the crook of your elbow.
For an interesting graphic showing the day by day progression of the virus across the world, please click here.
Jun
5
More Than 180 Million Customers Served: The European Health Insurance Card
Filed Under Health Insurance, International Healthcare, United Kingdom | 1 Comment
The European Commission recently announced that the number of Europeans using the European Health Insurance Card (EHIC) has topped 180 million people. The card was introduced back in 2004 to replace the somewhat cumbersome E111 form and then phased in over a year and a half. In January 2006 the E111 form was dropped completely.
The card allows anybody insured by a member state of the European Union to easily obtain free or discounted healthcare while on a temporary visit to another member state, although some countries will require the patient to pay towards their treatment. The card was intended to simplify the process that was originally fulfilled by the E111 form, as well as other E forms. The E111 form previously required people to request one every time they made a trip to another state in the European Union whereas the EHIC has an expiry date, much like a credit card, but more helpful.
The card now allows access to state provided healthcare to all European Union countries as well as countries in the European Economic Area (EEA) and Switzerland, bringing the total to 31 participating countries. It is important to note however, that the EHIC is only of use if you fall sick or injured while on a temporary visit, but prohibits people from traveling for the singular purpose of receiving healthcare. The European Health Insurance Card will thankfully cover maternity care and managing symptoms of chronic medical conditions, including renal dialysis.
There are however some issues. At the end of 2006, there were approximately 150 million Europeans walking around with the EHIC, and even now the EHIC is only carried by about 30% of the population. While some countries have incredibly high numbers of the population carrying the EHIC, such as Liechtenstein, Switzerland and Austria, all of which have over 95% of the populace holding the EHIC, people in other countries have not been rushing to get the card. One example would be Greece, where only 1% of the population holds the card. The fact that only 30% of Europeans have the card has prompted the European Commission to both engage in a information campaign as well as warn people going on summer vacation in Europe not to leave home without their EHIC.
Despite promoting the EHIC in time for the summertime, they have also warned people to make sure they take private travel insurance with them, as there are occasions and services that the EHIC will not cover. One of the main things to take note of is that the European Health Insurance Card will not cover the costs of any flights if you happen to be in a medical situation where you may need to be repatriated to your home country.
In addition, there are a number of countries such as France, Spain, Switzerland and Portugal that will require you to pay either a percentage of the costs or a fixed charge for different medical services, even if you present your valid EHIC. These may include costs for any prescriptions you receive, visits to the doctors and hospital stays. To clarify how important travel insurance would be should you fall ill while traveling; in France you may be required to pay for up to 45% of prescription costs, 30% of out patient visits to the doctor and a daily fixed charge for stays in French hospitals as well as having to pay a non-refundable 25% of the treatment costs in hospital. So even with your EHIC in your pocket, a quality travel insurance plan is still the best way to protect yourself from the costs of any unforeseen circumstances.
Please note that the European Health Insurance Card itself is FREE from your local government’s health authority. Do not be fooled by any websites you stumble across which are offering the EHIC for money. Bonus points for reporting possible scams to the appropriate authorities.
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