23 Responses to California Nurses Association Study: This Year, Private Insurance Companies Ration Healthcare With Rejection Rates Approaching 40%

1. dancingkitten September 4th, 2009 at 4:24 pm «

   I left this response in another thread, but it belongs here also:
   This is a fax that I sent to the President, my Senator and my Rep:
   You can send a free fax through this link:

   http://www.1payer.net/Campaign…..e-fax.html

   To President Obama, the News Media, and My Legislators:

   The only plan for health insurance reform that will save money and cover everyone is single payer – Medicare for all.

   The biggest unnecessary costs come from exorbitant overhead for the for profit insurance companies and the waste that comes from the plethora of different paperwork forms and regulations and rules for each of the many plans.

   Additionally is the copious time wasted by health care professionals in their attempts to get claims approved by insurance companies. The rejection rates by insurance companies are a scandal and should be outlawed.

   Insurance companies have been increasingly rapacious and their greed for increasing profits has meant escalating suffering and death for Americans in addition to the ever more frequent financial ruin.

   This “uniquely American” system is the laughing stock of the civilized world. Their current pleas for a level playing field would be funny if the insurance companies’ denial of a level playing field to their customers was not so tragic in its consequences.

   The people of America are the ones who deserve a level playing field: Single Payer Medicare for All. We voted for Change We Can Believe In. Now we demand that change!

   Sincerely,
2. john in sacramento September 4th, 2009 at 4:36 pm «

   Awesome links again CO
3. selise September 4th, 2009 at 4:49 pm «

   thanks CO. recommended.

   here’s some more from NNM’s diary at daily kos: The Real Death Panels: Insurers Deny 22% of Claims

   Why do they companies deny claims? Because it pays.

   Rejection of care is a very lucrative business for the insurance giants. The top 18 insurance giants racked up $15.9 billion in profits last year.

   It’s also a reason why private insurers divert up to 30 cents of every healthcare dollar to overhead — much of it spent to support warehouses full of claims adjustors needed to deny care, to keep down their “medical loss ratio” or profits lost on approving claims.

   So why aren’t these obscene, all too routine denials of claims — and ultimately care — more widely discussed in the national debate over proposed healthcare reform?

   The sad truth is there is little in the main proposals emanating from Congress and the White House to change these deadly practices.
4. selise September 4th, 2009 at 4:53 pm «

   btw, this is what happened to 17 year old nataline sarkisyan when cigna denied coverage for the liver transplant she needed.
5. Jim White September 4th, 2009 at 6:47 pm «

   Looks like PacifiCare has their death panel in place already.

   Great post, CO.
6. Sandmanj September 4th, 2009 at 7:23 pm «

   A huge thanks to the California Nurses Association!
7. marchan1940 September 5th, 2009 at 2:10 am «

   Thanks so much for this information on the CNA report!
   Thanks so much for dancingkittens letter!
   Blessings to all
8. marchan1940 September 5th, 2009 at 2:23 am «

   DancingKitten,
   I’m a neuropathy abd health care reform educator and advocate preparing a newsletter to my colleagues in Northern California and beyond. I really liked your letter to the president, et al and would love to use it as one of the info pieces in the newsletter. May I have permission to do so. Please email me at kairoschandley@yahoo.com with your answer.

   Blessings,
9. Smgumby September 5th, 2009 at 2:59 am «

   Excellent info!

   The most common response I hear when discussing insurance companies “rationing care” with frivolous claim denials is, “Those are just the few extreme cases”.

   With denial rates of 20-40%….

   Disgusting! Excellent post!
10. Evelyn September 5th, 2009 at 4:31 am «

    Thank you for this. I’ve been wondering if this information were available ever since an American insurance company refused to pay for a friend’s breast cancer treatment. That was my eye-opener. She had to sue them and after several years and more than $100,000 in legal fees to her she finally settled — for less than they owed her, no legal costs paid (the attorneys fortunately forgave most of the charges), and she had to agree never to bad mouth the insurance company. Not a great deal. Lucky for her she lived in France where her cancer treatment cost far less than the U.S.
11. Casual Observer September 5th, 2009 at 6:12 am «

    Any reader in California may want to check the whip list, and make sure that your House Member is aware of the rationing currently underway all over the state. I think this study provides an excellent argument for the public option.

    http://action.firedoglake.com/page/s/whipletter
• selise September 5th, 2009 at 6:31 am «

  I think this study provides an excellent argument for the public option.

  dear CO, how so? i see it exactly the opposite – that none of the pos as in current bills will both address this issue and be able to work (denial of care will still be an issue and/or massive adverse selection will result)>

  p.s. thanks for saying it’s ok to ask questions yesterday. i hope it’s still ok today. i’m asking only with respect and desiring to further an accurate understanding.
12. Casual Observer September 5th, 2009 at 7:26 am «

    Selise, I am not a wonk on this by any stretch–but I am assuming that a public insurance plan would not be rejecting claims at these rates.
13. Casual Observer September 5th, 2009 at 7:59 am «

    also, if anyone can find a link to the report itself, and not the media release or media coverage, I’d greatly appreciate it. I’ve been all over the CNA site and can’t find the actual report anywhere.
14. selise September 5th, 2009 at 8:20 am «

    I am assuming that a public insurance plan would not be rejecting claims at these rates.

    me too. absolutely.

    but, for the bills now on the table, most people would still have insurance from private companies — so wouldn’t they still be subject to this kind of claims denial?

    however, if a person with insurance from a private plan gets sick and has a problem getting their bills paid then maybe they could change over to the public plan. but there are some potential problems (just off the top of my head):

    1) that assumes they are not so sick that they can’t manage taking care of this kind of business (that’s not the case for everyone).

    2) it wouldn’t help them with the bills they already have

    3) would they only be able to change plans during a once a year open enrollment period? if so does that mean they have to wait up to a year to change plans?

    4) would people with employer provided insurance be able to switch to the public plan? would they be able to afford the public plan even if they were allowed to switch? (forgoing employer provided insurance and paying for one’s own policy is a big financial burden).

    so switching to the public plan may not be easy (or in some cases, even possible).

    but let’s say, for the sake of argument, that there are no impediments to switching to the public plan whenever anyone wants to. this then becomes an issue of adverse selection… because it will be people with big bills who are motivated to switch to the public plan. this is where the “level playing field” comes in — because if the public plan attracts people with the biggest bills and the public plan doesn’t reject claims for medically necessary healthcare (a good thing!) then the public plan will have the highest costs and therefore the highest premiums.

    high premiums will cause the young and the healthy to look elsewhere for their mandated health insurance. and that will make the public plan’s risk pool weighted further towards the sick (and expensive) customers.

    sometimes, when the incentives are screwed up as with health insurance, market competition can lead to a race to the bottom and not to “competition to keep insurance companies honest.”

    insurance companies compete on cost by denying care.

    …. however, i’m not sure but i think it may be possible to overcome this particular issue (adverse selection) if the risk pool is very large (as in the original hacker proposal — which is not on the table) and with very strong regulation and enforcement especially including community rating and risk adjustment (but we can’t seem to regulate our FIRE sector industries so it’s not clear to me how or even if this is possible as a practical matter)
• Casual Observer September 5th, 2009 at 8:33 am «

  I can’t predict the future on this, and everything you say here may indeed be true. However, if the public option is competitive and perceived as a better deal by consumers, I hope that it will not just become a high-risk pool.

  I’d add that the CNA themselves appear to be strongly supporting single payer. The healthcare professionals at our austin rally were also strongly in favor of single-payer, with public option being a second choice.

  by the way, have you had any success finding the actual CNA report?
• selise September 5th, 2009 at 9:12 am «

  it’s not a matter of predicting the future, multi payer systems have been tried before (see for example medicare advantage) and we have data on adverse selection (among other things). in fact there has been years and years of various kinds of studies on costs and financing healthcare. that’s what i was trying to bring up yesterday. given the bills now on the table, i don’t see how the po can not become a high risk pool. which i’d be just fine with if it was going to be subsidized (via fed budget) as one. if it’s not subsized as a high risk pool though, then costs have to be born via premiums. i can hear the rightwing crazies using the expense of a poorly designed po as an example of dem’s big gov failure (and therefore reason never to trust gov with single payer — “the gov can’t even run a public option plan without massive cost overruns”)

  anyway, in case you are interested i will try to find you some info on multi payer systems (hopefully later today or tomorrow before the comments close here). i remember one article in particular that was very good that i want to track down. (stupid me didn’t keep the link and don’t remember where i saw it though — so have to go looking and am not sure when that will happen).

  i sent an email to the CNA healthcare folks to ask for a copy of the original report. it’s a holiday weekend though so don’t know when to expect a reply.

  re CNA and single payer, here’s some background from last summer: Why is Health Care for America Now Giving Up on Real Reform?
• Casual Observer September 5th, 2009 at 10:36 am «

  I’ve written gottalaff too, in case she’s seen the report. It is so strange that they’d put out the pr but not have the report itself front and center.

  I’ve been looking around and there is a ton of data–mostly with state insurance regulators–on denial of care. However, it is so buried in jargon and contrasting terminology that it will take an insider to actually get clean numbers from much of it.

  I’d encourage anyone/everyone to check out their own state insurance regulator (usually a state insurance commission) to see what their data looks like. some states may not track this, but one would think that most must have some data on this topic.
• selise September 6th, 2009 at 1:37 pm «

  It is so strange that they’d put out the pr but not have the report itself front and center.

  i think so too.

  re adverse selection death spiral, see CA’s PacAdvantage. it was a somewhat different kind of system but it did have an exchange and it shows what can happen if adverse selection is not controlled:

  PacAdvantage: Adverse Selection Death Spiral
  Health Insurance Exchange? Lessons from California (report pdf link)

  was looking for a good up to date summary on adverse selection in health insurance, but haven’t found anything yet. will keep my eyes peeled (and ask around) as it seems to me this is a very important make or break issue for a public plan in a multi payer system. i’d think the more ways the private insurance companies have to deny care, the more at risk the public plan would be.

  if we get a public plan that fails, i don’t see how the dems will get a second chance at a public plan let alone single payer. they may very well poisoned the well.
• Casual Observer September 6th, 2009 at 2:43 pm «

  gottalaff has responded that she has not seen the underlying report either. CA. attorney general has it, but apparently nobody else.
• selise September 7th, 2009 at 3:26 am «

  thanks.
15. nahant September 5th, 2009 at 10:07 am «

    Thanks CO I just sent this article to my WingNut family members who are dead set against Single Payer!! Don’t think it will do any good but had to at least try one nut at a time!!
16. PaulaT September 5th, 2009 at 10:31 am «

    Well, DUH! You can’t spend over a million a day on lobbying and still pay a bunch of whiners’ medical bills, for heaven’s sake! We really need to give them more money to help them out in this time of economic trouble. That will solve the problem. After all, God loves capitalism so much that Jesus himself preached that if you help the least of his corporate brethren to maximize their multimillion dollar salaries and bonuses, it’s just like you have done it unto Him. Do you think it’s an accident that the greater percentage of passers-by in the Good Samaritan story decline to help the injured guy? It’s right there in the Bible that insurance companies should have high rejection rates!