What do assume and Association health plan have in common? A cautionary note!

So, did you figure that out yet?  What do assume and Association health plan have in common?

The first three letters of course! Don’t let either one make an “Ass” out of you!

In both instances there’s a high probability you’re going to end up with egg on your face if you don’t do your due diligence.

The presidents proposed changes to the Association insurance regulations are all the rage right now, and if ever there was time for caution in regard to your health insurance now would be the time.

Before I go on I want to point out the most basic concept of insurance and it would be a good idea for all of you looking at Association plans to keep this in mind:
Insurance is a process of collecting a small amount of money from enough people with low risk to pay for (cover) an unforeseen catastrophic event with one of the members.

Insurance is not a product, it is not a rich uncle, it is not the golden goose of your dreams, and it certainly cannot exist beyond the actuarial rules regarding risk. Money coming in must be bigger than money going out and anytime you take on unknown and uncontrolled risk you jeopardize the financial stability of the entire program.

Whether you are ensuring 1000 individuals with personal policies, or allowing 1000 individuals to join your Association plan, the risk is virtually the same. 1000 people need to contribute enough money to cover the $800,000 per year dialysis cost of one member. You can only control the risk by limiting exposure to the claims.

Promoters of association plans will tell you that they have found some way to reduce the risk, allow people to have better medical coverage, and produce the world’s best bagel. This might in fact happen, assuming that they reduce the benefits, and impose restrictions not currently available in most traditionally insured health insurance people purchase. Oh, it will really help if they can get you to have habits that keep you healthier.

So what are some of those restrictions I’m talking about?

Subrogation – If the Association is self-funded (or level funded) you need to be aware of the subrogation clause. That says that if you are paid for your medical expenses because of an auto accident your insurance plan can go back against your auto claim settlement and recoup their money. That means they take all of the money you got in your settlement.

You need to look at the most important page in the policy document, the exclusions page. This is where your plan can refuse payment if you are involved in any accident involving alcohol, any event that may be construed as self-inflicted, and a host of other things that would currently be covered under most health insurance plans that are fully insured.

Although it may not sound like it, I am actually a big proponent of association plans and self funding, however, there are going to be a large number of plans promoted by people who may not know what they’re talking about, and number two definitely do not have your best interest at heart.

Always keep in mind that no other person cares as much about your well-being and your health as you do. If you have a major claim of any kind it may well jeopardize your life. At that point you need to know that your health insurance covers what you thought it did. To put a finer point on the argument you do not want to be standing in an emergency room with your injured child wondering if the people you bought your health insurance from are ethical, honest, and honorable. At that moment you will not care how cheap the coverage was, you will only care that it works.

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Competence – who cares Spell Check will catch it!

Today I want to talk about competence, or probably more aptly the lack thereof. Let’s start with the question “Does competence really matter anymore?”
Does it matter if every word in your text is spelled correctly?
Does it really matter if everything in your last email was accurate?
Is it important if you’re insurance enrollment card was correct, can’t you just change it later?

Of course most of you who know me will say that my short answer to this is “Are you serious?”

I recently saw a joke about the importance of one letter being missing in a text message. A man was having a great time on a trip so he sent a text message to his wife. When he got home she had filed for divorce based on his text message which said, “having a great time wish you were her!”

Before somebody points out to me that I too have sent emails to the wrong address I wish to agree to a Mea Culpa right now. No matter how important competence is to me or how hard I try, I also make mistakes now and then. The question may not be do we make mistakes, because we all do. The question is more what is our attitude toward general competence and what is our acceptance level for a lack of competence?

What if the credentialing report for your surgeon left out the word “not” when they wanted to indicate he was “not” qualified?

What if the jury left out one word in their verdict they delivered to the judge: “the jury finds the defendant (not) guilty!”

Competence matters and even minor errors can have dramatic impacts on your life.

Today we received a report from a payroll company indicating the people who had added and people had deleted coverages in their open enrollment event. It turns out that due to some programming issue every single event may have been reported incorrectly. Due to a highly competent staff member in my office it was noted that these did not make any sense and she questioned the report. Had she just let that report go through several people would have been erroneously deleted from coverage. Do you think that would have had an impact on their lives? Do you think it might have had some impact on the employer?

Of course competence matters and I would ask where in your lives do you see the demand for competence and knowledge becoming less important. Are you finding more people applying for work whose attitude is who cares you can always fix it later, or spellcheck will catch it?

In every issue it is true that you will get more of what you encourage. If in your work life and your daily life you encourage or except incompetence you will certainly get more of it and the impact on you could be catastrophic. In our situation it eats up valuable time having to check the work of every person and company we deal with due to the increased incompetence caused by a general lack of knowledge, no sense of importance in their own work, and to a great degree due to the increased automation of almost every task.

It can truly be said that to err is human but to truly screw up you need a computer.

Workloads have increased dramatically in every field and this has caused people to rely heavily on computerized solutions to their day-to-day jobs. The problem with taking the human mind out of the endeavor is that once a mistake is made the computer multiplies the magnitude of that mistake many times. It is true that people do make mistakes just because were people, and were busy. However, when you couple being human with an increased reliance on computerization and automation it becomes imperative that each person have a sense of personal honor and dedication to competence.

I have a sign over my desk that says “Is that your best work?” Are you doing your best work? Is competence important to you?

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Are you smarter than congress about health care cost?

This might seem obvious but to properly address an issue you must first understand the problem you are trying to fix. Well clearly our legislators, the media pundits, and most of the clamoring public seem to be ignoring the need for understanding the problem in discussions of Health Care cost and how to pay for it.

So let’s just dive right into the healthcare “cost” issue.

Why is it important – This goes way beyond partisan bickering and protecting political turf. Which also is why it cannot be corrected with hurried and poorly prepared legislation.
This is about you with your injured child – “Do you have insurance? How will you pay for this?”
This is about you losing everything because you – had a heart attack – lost your job – lost your insurance and now face $200,000 in medical bills you cannot pay.
This is about a national cost item that cannot be paid for in any governmental scheme that does not include care restriction and increased taxation. Yes – if you consider unlimited health care a basic right for everybody, that is true!

Language – words matter and if you don’t understand the language, you not only cannot fix the problem you may inadvertently make it worse. We all must differentiate between “Health Care cost” and “Health Insurance.” They are related but not the same:
A. Healthcare cost – this is the actual cost of medical treatment and related services. This exists if you have insurance or not. This is what nobody can afford to pay, and WHY you need insurance.
B. Healthcare insurance – this is a funding mechanism designed to “pool” risk and spread the cost. This is how we collect a relatively small amount of money from healthy people to pay the bills for somebody who needs care. This is how we as a society pay for all those healthcare costs.
C. Access to “Healthcare” – This is the ability for a person to get a healthcare professional to treat them. Everybody has basic access to general healthcare and emergency services. What you might not have is enough money or “Insurance” to pay for your treatment.

So the next time your hear somebody say “Healthcare is just too expensive we have to beat up the insurance companies”, quietly know that they are uninformed.

Economics. There is at least one un-refutable truth in economics. Money coming in must be bigger than money going out. Even governments cannot live forever if debt exceeds revenue. Eventually even government runs out of your money and your ability to create more GDP.

The problem – So the problem is the “Cost” of healthcare. How do we address that?
First it is critical we all stop blaming and finger pointing, we need to talk and agree on a few things.

Try this approach – you do not get to complain unless you have thought about it and bring forward an idea to solve the problem. You don’t have to be right the first time, but you do have to be part of the solution and not just some anonymous internet loudmouth complaining.

Start here:
Problem    National Health Care cost ___________________________________________________________________________

Solution    My idea to provide care and pay for it ___________________________________________________________________

To paraphrase a credit card company – what’s in your mind? How would you approach this problem?

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