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S&S Benefits.....Opinion, Hearsay & News Review

S&S Benefits Consulting, Inc.  219 Darien , Dundee , IL 60118   Phone: 847-428-5353, Fax:847-428-9876

Email : jseiler@ssbenefits.net                                               http://www.ssbenefits.net/   March 2008 Issue

For all those who think estimates of the cost government mandated health care figures are poppycock, you are right. They are gross underestimations. From the Boston Globe the word comes that the original cost estimate of the Massachusetts bipartisan health care mandated program would be $725 million with 215,000 people enrolled. The Globe reports that spending on the program will cost $1.95 billion this year. The state is now asking the federal government to help shoulder half the costs. Take that into account the next time you hear any political candidate say they are going to solve the healthcare problem and it will only cost X. Riiiiiight!

The website of the Public Library of Science Medicine says the lifetime costs for obese individuals and smokers are lower than for healthy people that live longer. In a Netherlands study of 1000 people, on average, the healthy lived 84 years with a cost of $417,000 for life while smokers and obese people lived 77 years with lifetime costs  of $371,000 for the obese and $326,000 for smokers. Should we rethink wellness initiatives with new programs such as Eat, Drink and Smoke and Be Happy?

Unicare has announced that PHCS is taking over their Rockford , IL network and that customers should expect fewer docs to be available, but that there will be greater hospital discounts. Also the Rush System for Health has ended its participation in the Unicare HMO Illinois network. In addition Rush Health Care System is no longer participating in the HealthLink PPO network. UnitedHealth Group has completed its acquisition of Sierra Health Systems in Nevada . As a condition of the sale, the DOJ had UHC divest its individual Secure Horizons Medicare Advantage group and those 25,000 members will be purchased by Humana. NMHCRx is being acquired by SXC Health Solutions out of Lisle, IL. NMHC will be treated as a wholly owned subsidiary and renamed informedRx. Condell Medical Center in Libertyville , IL continues talks with Advocate about being acquired. Condell has lost 20% of its patient base due to terminating contracts with Blue Cross and they have had to lay off 80 employees.

UNUMís data indicates that LTCI is needed at a younger age than most would think. Fifty-seven percent of Unumís group LTCI claimants are under age 65 with 15% younger than 45. More than 70% of under age 65 claimants received care at home.

CVS Caremark has settled (not admitting guilt) for $38.5 million with 28 states over charges of engaging in deceptive business practices by encouraging doctors to switch patients to certain brand-name drugs where rebates were better for the PBM. $2.5 Million will be set aside to reimburse patients.

South Carolina has signed into law a bill a bill that allows a group of at least 10 small businesses to join together to negotiate less expensive insurance rates. The law replaces a law that no employers were taking advantage of. That law required a minimum number of employees in the group to be 1,000 when employers joined together for purchasing health insurance.

Another New York Attorney General is trying to make a name for himself. Andrew Cuomo says the AGís office plans to file suit against Ingenix, Inc. and its parent UnitedHealth Group over a scheme to defraud consumers by manipulating reimbursement rates. Ingenix has for many years (they bought out the database owned by HIAA) provided the Reasonable & Customary (R&C) data to formulate payment rates for out of network providers. (Apparently the concept of patients using non-balance billed networks escapes government employee Cuomo). To explain: Ingenix gathers the data for all the charges for medical procedures within a 3 digit zip code area from insurance carriers and TPAs. The database is huge and usually updated every six months. The charges are then broken down into percentiles. For instance, the 90th percentile is what 90% of the doctors in a certain 3 digit zip code charge for a certain procedure. The data Ingenix provides is then used by the insurance carriers and TPAs to provide a U&C (or R&C, or U&P) rate for the procedure. Non-network providers usually balance bill patients for the amount over U&C.

Since most insurance plans reimburse out of network claims at or above the Medicare level, perhaps Cuomo would be better off suing Medicare for fraud? Medical providers who accept Medicare patients are not allowed to balance bill them.  If Medicare reimbursement levels are appropriate, perhaps Cuomo might consider whether a $200 fifteen minute office visit is overcharging by the physician? Is that fraud? To accuse Ingenix of being guilty of fraud for supplying data would be ludicrous. Government employee Cuomo illustrates again the fact that ignorant government is not an oxymoron.