10 lessons learned from this election - Page 7
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Thread: 10 lessons learned from this election

  1. #61
    Community Host Alissa_Sal's Avatar
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    I think the single biggest problem with Obamacare is that it is based around for profit insurance companies (which, as you may know, I believe are "of the devil." )

    Health care isn't my area of expertise, but I was thinking about how I would go about making an impact model. Keeping in mind that I know only about as much as the next guy about the insurance/healthcare industry, and only some of the highlights of Obamacare, here are my thoughts:

    Obviously, as a for profit company, insurance companies are not going to take losses on the chin. So first I started thinking about what their extra costs would be from Obamacare. The two that I'm aware of are birth control and covering people with pre-existing conditions. The birth control thing is interesting, because I am sincerely curious how many plans did not cover bc before. I've heard of people complaining about the unfairness of it in the past, but it seems like such a relatively cheap and money saving move to pre-emptively cover birth control (birth control, even years of it, is likely to be less expensive to the insurance company than a pregnancy, which they do cover as far as I know.) So, we'd factor in the growth in the extra cost of birth control, and use some model to predict how much the cost of pregnancies is likely to go down, if any. We'd also factor in the increased cost of covering pre-existing conditions, less the revenue they will generate from having those people pay their premiums. That's all on the negative side for the insurance companies.


    On the positive side, we have an increased customer base. I believe there are like 50 MM uninsured people in the US and presumably most of those will end up getting insurance, so sales go up for insurance companies. We also have some reduced operating costs under Obamacare. As I understand it, part of Obamacare stipulates the government leaning on healthcare providers to create effiencies and reduce costs (think, getting rid of the famous $25 for two aspirin example, among many others.) The famed "Death Panels."

    Okay, so any gap between the cost increase incurred by Obamacare would be:

    (cost of increased services, like birth control minus the money those services save because of pre-emptive care, like pregnancy + cost of providing services for people with pre-existing conditions minus the revenue paid in premiums by those people)

    Minus the revenue increase caused by Obamacare:

    (increased customer base + decreased operating costs)

    Any negative gap between these two numbers can reasonably be attributed to Obamacare and expected to be passed along to the employers.

    A couple of things about that though - the total gap may be less than would put insurance comapanies into the red. The only reason we need to worry about covering that gap AND them still making a profit is because they are for-profit. If they were non-profit, they would only need to charge enough to cover their costs.

    The other thing is that as for profit companies, they have a commitment to continue growing profits to shareholders. So, it's not like they're ever going to say "Okay, we've made enough profit, we can stop now that we are at this level." This is part of why insurance costs have gone up year over year regardless of health care regulations, they have to keep their profits going up.

    When a company wants to grow their profits, they have to do one of several things:

    1. Increase sales - Obamacare actually does some of this for them. Also, being a free market, despite the increased cost of operations (which will impact all insurance companies, presumably) they may decide to actually lower their prices a bit to be competitive to attract more employers looking to cover their employees as cheaply as possible. Maybe not, but it's an option.
    2. Decrease overhead - If Obamacare works the way it is supposed to, some of this may come into play again with the initiative to work with health care providers to lower costs
    3. Expand product offering - being in services rather than commodities, this is harder to do, although there are some models out there to look at. For example, Kaiser and Medco are both insurance providers and healthcare providers (Kaiser provides full medical care at their facilities, Medco is a prescription insurance company that provides prescriptions.) There are also ancillary businesses they could look at, like technology (for example, I know there are companies out there working on med alert bracelets that can be scanned by personel at the hospital that will bring up conditions, medications taken, emergency contact info, insurance info, et cetera)
    4. Raise prices

    I think it's important to note that any price raising above and beyond what is needed to cover the gap I spoke of earlier has nothing to do with Obamacare and has everything to do with being a for-profit company.

    Too long; didn't read?
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    You forgot covering everyone under the age of 26 on their parents insurance regardless if they are married, out of the house, with kids of their own.

    ~Bonita~

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    Posting Addict fuchsiasky's Avatar
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    Quote Originally Posted by Alissa_Sal View Post
    I think the single biggest problem with Obamacare is that it is based around for profit insurance companies (which, as you may know, I believe are "of the devil." )
    This is what I am thinking. Here we have all of the basic medical insurance through the province. It is maximum $54 per person per month. If you are low income you get a discount or free. Because it is done by province it is essentially a massive group plan. The plans we have through private insurance are for extended medical or dental to cover the things that the provincial plan doesn't. It makes a heck of a lot more sense to me than letting for profit insurance companies manage the whole thing!
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  4. #64
    Community Host Alissa_Sal's Avatar
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    Quote Originally Posted by AlyssaEimers View Post
    You forgot covering everyone under the age of 26 on their parents insurance regardless if they are married, out of the house, with kids of their own.
    No, I actually thought about this, but decided to lump it in as a plus for the insurance companies, again, because of expanded customer base.
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    Posting Addict smsturner's Avatar
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    Quote Originally Posted by AlyssaEimers View Post
    You forgot covering everyone under the age of 26 on their parents insurance regardless if they are married, out of the house, with kids of their own.
    I'm sorry, I just cannot possibly see how this is a bad thing. Is there ever 'too much' health insurance to go around?? I don't think so!




    Originally Posted by Alissa_Sal

    I think the single biggest problem with Obamacare is that it is based around for profit insurance companies (which, as you may know, I believe are "of the devil." )
    There aren't words to say how much I agree with you alissa!!
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    I work for a not-for profit insurance company. We are not motivated to turn a profit.

    NHCR also has a mandate that ALL insurance companies show a minimum % of their premium dollars going to pay claims. If they are under that % they have to reimburse their members.
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    On the BC item. Mandate is only for tier 1/generic BC anything else is subject to member cost.

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    Community Host Alissa_Sal's Avatar
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    Quote Originally Posted by Jessica80 View Post
    I work for a not-for profit insurance company. We are not motivated to turn a profit.

    NHCR also has a mandate that ALL insurance companies show a minimum % of their premium dollars going to pay claims. If they are under that % they have to reimburse their members.
    Bless your heart! They should all be not-for-profit. Give yourself and your coworkers a hug from me.

    Oooh, minimum % of premium dollars going to pay for claims or reimbursement throws an interesting twist on things. Bad for insurance companies' mission for growing profits year over year, good for employers (at that rate, insurance companies will have to rely more heavily on a model that increases the customer base and/or services offered, or decreases costs, as opposed to raising prices) Good to know!
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  9. #69
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    Quote Originally Posted by Alissa_Sal View Post
    No, I actually thought about this, but decided to lump it in as a plus for the insurance companies, again, because of expanded customer base.
    I do not understand this. It is possible I just do not understand enough about insurance.

    Thousands of people ages 18-26 were paying for there own insurance. Lets say an average of $100/month because that is how much it cost when I was that age. (This will very by job and area) All those people stopped paying themselves and joined under their parents. A family plan is a family plan, so the parents would not have increased how much their were paying. That means the insurance companies now have Thousands of dollars less a month coming in then before. They will not just swallow that cost up, but instead raise everyone's cost. They might have raised their number of customers up, but did not rise the money coming in. Just the money going out.

    ~Bonita~

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    Actually Bonita, they weren't purchasing insurance even if their work offered it because they are relatively healthy group and many times do not have a family to worry about. So they ended up at the ER when things went bad. We're still stuck for that cost many times because Er visit can turn into inpatient stay and those costs can become astronomical. We all pay for that. Our premiums increase because all private insurance has to pay into free care pools. The more people who don't need free care...the lower your premium gets over time.


    Ha ha Alissa~ I can't take credit for it.

    Although, I do realize I'm speaking a lot about my company and industry so I do need to add this disclaimer that everything I say is reflective of my opinion and no reflection on my company.

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