I saw an interesting report from Deloitte on the profile of people who are buying on Exchange insurance products. One thing stood out to me that I need to chew on some more. Namely, narrow networks are most attractive to millenials (P.21).
This to me makes intuitive sense as younger indiviudals are far more likely to be healthy than older individuals. Getting old sucks.
I find it interesting that income is not a good predictor of willingness to look at narrow networks. A narrow network that is 10% to 15% cheaper than a broad network should, all else being held equal, should be very attractive to someone who does not have a lot of cash. Health status or the awareness of risk of the health status swamps cash constraints. That to me is surprising. The narrow networks are effectively acting as adverse selection filtering systems as they are scooping up young people who are very healthy and very low cost while the broader networks are grabbing older people irregardless of their income levels and thus they are the cost sinks of the exchanges. This works as each company’s risk pool is the collection of all of its plans offered in a single band in a state so Mayhew Narrow Silver and Mayhew Broad Silver are paying into the same risk pool, so the young and healthy are still subsidizing the old and less healthy. The problem emerges if only a company offers a market leading narrow network product. The cash and risk shifting mechanism of risk adjustment will mostly balance out the risk over time, but it takes eighteen months for cash to come from a healthy company’s risk pool to a sick risk pool.
oldster
“The problem emerges if only a company offers a market leading narrow network product.”
I’m thinking you meant:
“The problem emerges only if a company offers only a market leading narrow network product.”
yes?
FlipYrWhig
I’ve been lucky to be in good health (now 43) and for that reason I’ve only ever understood in the abstract why there’s such fuss about “keeping your doctor.” My experience of going to the doctor hasn’t led me to believe that one doctor is any different from the next. When I was first on my own health insurance I was baffled by the booklets with the names of hundreds of indistinguishable providers. (And I’m still not sure what the differences are between the kinds of doctors, like “internal medicine.” Isn’t all medicine internal?)
mb
“…income is not a good predictor of willingness to look at narrow networks.”
It’s just one more example of how healthcare does not, and I would argue cannot, fit into a free market model. We will keep on trying, though.
Bruce Webb
Richard at some point the strategy of a company crafting a single narrow network product to snag healthy millennials while ignoring the rest of the market runs into the MLR requirements. After all they have to spend that 85 or 90% on SOMETHING that meets the definitions of ‘medical loss’.
It make take 18 months for the cross subsidies to flow but those rebate checks flow out very year.
Mingobat f/k/a Karen in GA
@mb: What you said.
As I’ve gotten older, I’ve cared more about health coverage. At jobs where I’ve had a choice, I’ve paid more for the better coverage, regardless of my income. It’s too important for me to cut corners on it. It’s life or death, not a consumer product.
grammar nazi
And I think you meant either “regardless” or “irrespective,” not “irregardless.”
/grammar nazi
(Hey, let me have this — I’m a dolt in so many other areas.)
PST
I suppose the lack of longstanding physician relationships could be one reason youngsters might be happier with a narrow network than I would be, but surely there must be reasons other than keeping a familiar doctor that are just as important. Ensuring access to the best possible care takes on greater value as we grow old, and thus increasingly likely to suffer serious illness. Moreover, with time, people may become more sophisticated consumers of medical services. After you’ve been through the healthcare maze a couple of times and watched family and close friends do the same, you know that there are differences in quality.
NonyNony
@FlipYrWhig:
I consider myself very lucky to have had a string of very good primary care doctors.
And when I say a “string” I mean it – over the past 20 years I’ve probably changed docs a dozen times.
About half of them were from me switching jobs and having a completely different insurance company who didn’t have my doc in network. Another chunk were from my employer switching insurance to something cheaper and losing my doc. Then there were the 2 different doctors I’ve had who retired shortly after I started seeing them. And of course the best doctor that I’ve ever had, who I had as a primary doc for about 3 years, decided to just up and quit being a doctor one day and go do something else with his life.
The idea of “being able to keep my doctor” is such a foreign concept to me. Sometimes I think it’s one of those old-timey concepts that don’t apply to our modern world anymore – like working for the same company for 40 years to retirement or being able to work your way through college without taking out any loans…
Mike J
I had assumed narrow networks would be most attractive to younger buyers simply because they are less likely to have a long term relationship with a particular doctor. The people who dislike narrow networks often dislike them because their doctor isn’t in them. No doctor, no problem.
gorillagogo
@FlipYrWhig: Internal medicine is a euphemism for general practitioner.
Thoughtful Today
Insurance complexity.
Or single payer?
The latter is more efficient and provides better health outcomes than our current corporate bureacracy.
gorillagogo
@NonyNony: I can understand why relatively healthy people don’t seem to care about keeping the same doctor , but I’ve had Crohn’s disease for over 30 years. I want to see the guy who knows my history.
Gimlet
Suggested topic for future post
let’s recap the news about next year’s Part B premiums, which cover doctors, outpatient expenses and other services. The rules say that these premiums must be deducted from Social Security payments if someone is receiving Social Security and Medicare. Since those costs are expected to rise more next year than they have in recent years, Medicare must boost premiums that it will begin collecting next January.
However, overall inflation this year is expected to be low. Current levels of inflation determine whether Social Security beneficiaries will receive a cost of living adjustment (COLA) in 2016. The way it looks now, the trustees said, there likely will be no COLA at all.
When this happens, Social Security’s “hold harmless” provision kicks in. This rule says that no existing Social Security beneficiary paying the basic Part B premium ($104.90 this year) can be forced to receive a smaller Social Security benefit in one year than they did the previous year. These folks, roughly 70% of beneficiaries, would therefore continue paying $104.90 a month next year in Part B premiums.
Yet Medicare must raise about 25% of total Part B expenses from its recipients. So the program will have no choice but to collect all of this required revenue from the remaining beneficiaries, who will not be held harmless.
This group includes new Social Security beneficiaries, existing beneficiaries who have modified adjusted gross incomes above $85,000 ($170,000 if filing joint tax returns), and those who pay their Part B premiums directly to Medicare instead of having them withheld from their monthly Social Security payments.
Luthe
@Thoughtful Today: The choir has already heard this sermon, sung this hymn, prayed to this god, and exited the church. Are there any new insights you have for us?
pseudonymous in nc
@FlipYrWhig:
I agree, though I do come from a country with an actual healthcare system, so I’m not a good data source here. There are plain bad doctors that are best avoided, but I’m not a special snowflake who demands The Best Doctor. Medicine is medicine, mostly.
It does reveal how much of the past 30-40 years of ‘patient choice’ has been directed towards peripheral bullshit, and younger people aren’t as bothered by that.
(I can understand gorillagogo’s point about keeping a doctor that knows one’s medical history, but… doctors retire. And the discontinuity that comes from changing providers doesn’t need to happen if the records are good enough.)
OzarkHillbilly
@NonyNony: The only time I have ever seen “my” doctor (not even sure what her name is) was when I ended up in the hospital with blood clots. I have however been seeing the same nurse practitioner for about 12 years. I don’t want to see anybody else.
jibeaux
I bought one of those value plans, because although I can get spouse coverage from my husband’s job, you pay full freight so the value plan was $200 a month cheaper — an under-discussed benefit of the exchange,in my view. Anyway, my endo that I see once a year is not in network. But they are willing to charge me the self-pay rate for the visit, which is lower than the copay on either in or out of network providers. Which is weird, isn’t it? Why wouldn’t they accept insurance that pays higher than self pay, the hassle factor?
low-tech cyclist
Yeah, that’s why I refuse to do it.
I’m a bit of an outlier, but between good health and frequent moves, I didn’t have a regular doctor (except as a child) until I was 45. Because of that, it makes perfect sense to me that the millennials are OK with narrow networks.
PST
The subject of whether one doctor is better than another is one that has been studied with respect to certain procedures. For example, general surgeons can get qualified to perform colectomies, and manyh of them do, as it is well within their skill set, but statistics show that five-year colon cancer survival rates are better if the surgery is performed by a board-certified colon and rectal surgeon working at a hospital where these operations are performed with high frequency. I wish I could put my finger on a citation, but this has been a matter of intense interest a couple of times in my life and I did the research then. More generally, speaking as a medical malpractice defense lawyer, it is pretty clear that practice makes perfect, and you are better off with someone who has settled into a groove of doing the thing you need done over and over, whether it be a new hip or a new heart. Don’t get fobbed off on a generalist.
debbie
@NonyNony:
“Old timey” or not, it prevents a lot of duplicative tests, delays, etc. Not to mention not having to launch into a recitation of my medical history (and the likelihood of leaving something out) multiple times and being able to find out if my doctor thinks a proposed treatment is valid. Hate sounding bureaucratic, but the efficiencies can’t be beat.
greennotGreen
No it doesn’t.
–cancer patient
greennotGreen
@PST: Also, there can be a BIG difference between doctors! In the many doctors I’ve seen since my original diagnosis, I saw one I’d never seen before who told me that if I didn’t immediately have surgery to tack my lungs in place (edema following the initial debulking surgery wasn’t allowing my lungs to inflate properly) I would die quickly. Didn’t have the surgery, didn’t die, didn’t go back to that hospital.
Another doctor, part of the stellar team I’ve been seeing ever since, filled me with enough hope to wipe away my tears and learn that I can live with cancer.
The right doctors make a world of difference.
NonyNony
@debbie:
Oh, I know the benefits, trust me – just having to go through the paperwork alone for a dozen different doctors over 20 years is enough to make me wish that I could have kept my doctor each time, nevermind the “wasted” time rebuilding trust relationships with doctors that could have been better spent for both of us. And if I had had major health issues I was working through with any of them it would have been even more infuriating.
It’s just that I have no experience with it. I’m shocked when I find people who have been able to keep their doctor for 2-3 decades because it’s something I wish that I had but that I find impossible with the way the current employer-provided insurance health care system works.
Thoughtful Today
Erm…
Most people don’t know that single payer healthcare has consistently provided better health outcomes with greater efficiencies.
I’m comfortable repeating those facts, but if you need more details I’d suggest starting with the World Fact Book going back the last dozen years.
dr. bloor
@mb: I’m always puzzled by the assumption of the “rational consumer” by health care bean counters. You’d be hard-pressed to find an area where emotion-driven odds calculations, baseless anxiety, and garden-variety avoidance and denial go into the decision making process more than healthcare insurance and treatment.
Mnemosyne (tablet)
@Thoughtful Today:
Open enrollment periods for 2016 for both people who have employer-based insurance and people why buy on the Exchanges start in October. That’s four weeks from now.
You may be one of the lucky ones who can go without insurance in 2016, but the rest of us would like a space to discuss our options for next year and figure out how to navigate the current system since some of our goddamned lives depend on it. You really think that a current cancer or Crohn’s patient is more interested in discussing a theoretical single payer system than s/he is in discussing what the best insurance option is for next year?
It’s nice that you get to live in the airy-fairy future with no current healthcare concerns. That’s not where most of us live right now.
Richard Mayhew
@Mike J: I thought that true, but I thought health condition would be a more important factor.
In my mental model, a healthy 43 year old should be more willing to go narrow network shopping than a sickly 22 year old.
That is not what this evidence suggests.
Thoughtful Today
Part of the discussion is about corporate insurance.
You’re forgiven if you thought it was about healthcare.
Clearly several here don’t understand the difference. Possibly several here are paid not to understand the difference.
To be clear:
Insurance salespeople are not health care providers.
Healthcare professionals understand that.
Mnemosyne (tablet)
@Thoughtful Today:
Again, it must be nice for you to not have to deal with our current insurance system in order to obtain healthcare, but you really should let those of us who do have to use it figure out what our options are and the best choices we can make.
Because, since you seem to have missed it, the entire point of these threads is to help people navigate the current system. We’re all stuck in the wilderness and Richard is helping us find fresh water and build a shelter while you refuse to help and instead run around screeching about what you’re going to do when you get home after we’re rescued.
debbie
@NonyNony:
Like many employer-provided plans, mine has a high-deductible/low-cost and a low-deductible/high-cost plan. I checked both and found the higher cost plan had a larger network that included all of my doctors. I was surprised, considering that both plans were for the same insurer, but I decided to spend the extra money just for the continuity.
Thoughtful Today
NB:
Someone with serious medical conditions trying to hunt for the most affordable insurance … still hasn’t received medical care.
Anyone who is currently struggling with insurers deliberate complexities needs to think about what’s best for their long term healthcare.
For many people that is taking single payer healthcare seriously.
In the long run, single payer healthcare will keep more people alive.
Brachiator
@mb:
To the contrary. This is exactly what a free market anticipates. Instead of a one size fits all system, younger people with less cash are willing to bet on their continued good health. For the majority, this is the right decision.
Even if you tried to eliminate the “free market” entirely by eliminating any individual payment, there would still be a health care market that would be shaped by individual’s decisions.
Omnes Omnibus
@Thoughtful Today:
I’ll bet no one here disagrees. Nevertheless, in the short run, people need insurance to get healthcare. And some of them need that healthcare to survive to the long run.
Kylroy
@Thoughtful Today: Yes. But in the short run, people will DIE if they don’t get healthcare from the system we have. It’s like we’re trying to discuss improving gas mileage and you’re spouting off about how OBVIOUSLY superior electric cars are. Good for you, we agree, but we have problems that have to be solved faster than massive social change can be enacted.
Brachiator
@Thoughtful Today:
Many industrial nations have universal healthcare, but it is just tiresome to see people continuing to falsely imply that every nation has exactly the same kind of single payer system, funded in exactly the same way, and delivering exactly the same level of medical care.
Brachiator
@Richard Mayhew: In Southern California, I notice a lot of people filling a new urgent care area that has been added to a Kaiser Medical office. I guess that some of these people would previously have gone to an emergency room (which this facility does not have), but I also wonder how much of this is due to the claim that many people here are having problems finding primary physicians even after they get insurance coverage.
I have also read (but do not know how common this is) that there are people who always choose to go to an emergency room for regular medical care, with the idea that they will then always have access to the best staff and equipment.
Robert
The last time my company switched insurance plans I used the ins. company tool and found a doctor near me, then I cross checked and found that their reviews were terrible for customer satisfaction. I then went back to the list and ended up spending a good deal of time cross checking before I settled on somewhere in network with a “recommended” rating from the ins. and also a decent set of customer reviews. This is not something that I want to do again, and in fact I would be willing to pay a bit more to avoid it. I don’t have any particular medical problems, but at 38 I’m just above the cut-off mentioned of 34. I think back in my 20’s I would certainly have been much more open to the idea of giving up an evening or two to online comparison shop in order to find a lower rate (assuming I had that option, which I don’t since small company = limited options).
So I guess what I’m trying to say is that maybe some component is also linked to those slightly older demographics being a bit more willing to take at least a smallish increase vs. the simple annoyance and time that finding a new primary care office can entail.
Thoughtful Today
re: Health studies
Excellent tool for finding health studies is:
http://www.ncbi.nlm.nih.gov/pubmed/
pseudonymous in nc
@Brachiator:
I’ll re-quote dr. bloor: “You’d be hard-pressed to find an area where emotion-driven odds calculations, baseless anxiety, and garden-variety avoidance and denial go into the decision making process more than healthcare insurance and treatment.”
And for sure, all markets have their irrational bits where purchasers operate on incomplete and broken information, but healthcare takes the cake.
There’s evidence that you’re better off with a surgical specialist in the operating room, but is there evidence that seeing the same doctor over an extended period of time delivers better medical outcomes, or is that more about the Patient Experience?
Mnemosyne (iPhone)
@Thoughtful Today:
The person with cancer or Crohn’s can’t sit back and wait for the long run. They need care NOW, which currently translates into getting the best insurance coverage they can get under our current system.
It says a lot about you that your answer to people who were just diagnosed with cancer is, But if you wait around for 10 years, we’re going to have a great system! I guess we have to let those people die in the meantime as sacrifices to the system you prefer.
Thoughtful Today
Erm…
“Free market” insurance had a death toll of 45,000 Americans every year.
Regulated “free market” insurance through
NixonCareObamaCare reduced uninsured Americans significantly. It did not eliminate the uninsured. It did not provide health care to all Americans.Again:
Insurance is not healthcare.
Mnemosyne (iPhone)
@pseudonymous in nc:
I’m guessing it partly depends on if you’re talking about someone with a chronic or ongoing condition or not. If you’re pretty much healthy, it probably doesn’t much matter who you see the few times you have to go in. If you’re trying to manage diabetes or depression or Crohn’s, it’s important to see the same practitioner multiple times so they can monitor your progress and don’t have to get up to speed every time they see you.
Mnemosyne (iPhone)
@Thoughtful Today:
In this country, insurance provides access to healthcare. How long should a cancer patient put their treatment on hold waiting for Bernie to get his new system up and running? Assuming he gets inaugurated on schedule, we’re talking about June of 2017 at a minimum.
So what do you suggest people do in the meantime? Refuse treatment for their cancer or Crohn’s or diabetes until your preferred system is up and running?
Mnemosyne (iPhone)
@pseudonymous in nc:
Also, too (to get back on topic), the ongoing healthcare provider for those chronic conditions doesn’t necessarily need to be an MD, as OzarkHillbilly said above. It could be an RN or PA trained in that area who knows how to manage that condition and when to call in an MD because the patient reports a change in their condition.
gorillagogo
@Thoughtful Today: It did not eliminate uninsured people butit hehelped reduce the number. This is very personal to me because in the mid to late 90s I found myself unable to get a good job with health insurance benefits, so I wound up accumulating a crap ton of credit card debt and eventually got so sick I needed two feet of intestine surgically removed. I would have been much better off if something like Obamacare existed back then. Thankfully for me by the time I needed surgery I was able to start a new job that offered health insurance without a pre-existing condition clause, or else I would’ve been really fucked.
mb
@Brachiator: If young people, men in particular, were making rational decisions about healthcare coverage, they would be purchasing comprehensive mental health insurance. They are at relatively high risk for the onset of schizophrenia, for example. My guess is they don’t even consider it. If we had a comprehensive mental health system to offer them, maybe it’d impact on the next Dillon Roof.
Healthcare, and by extension, healthcare insurance, doesn’t fit a free market model for many reasons. Very few people understand the healthcare they need or their real risk factors. Very few healthcare consumers can judge whether one treatment regimen is better than the other. A key, fundamental aspect of a free market, an educated/informed consumer is almost completely absent in the so-called healthcare market — nor is it practically possible to have informed consumers.
And then there is the question of elasticity of demand. Spend some time in an ER watching people make life/death decisions and then come talk to me. I wrote a promissory note on a man’s home to secure his payment for open heart surgery. Didn’t even flinch, didn’t discuss terms. It was just, “where do I sign.”
Brachiator
@pseudonymous in nc:
I saw the quote and there is some wisdom in it. However, rational does not mean that a person makes a “good” or “correct” or “reasonable decision.” Rational here means that a person makes an economically understandable decision with respect to a market.
A person who is young, healthy, and with less money might reasonably make a decision that keeps more money in his or her pocket, even if this is not the optimal medical outcome. Even if the person bets wrong, and gets sick, they will still have medical coverage.
Thoughtful Today
In a rational world you’d at minimum have a professional Medical Doctor tell you what insurance you need.
Insurance agents can’t diagnose a person’s health needs.
And yes:
Moral countries have decent minimum universal health services.
Ruckus
@NonyNony:
I had a great doc once upon a time but he moved to a much nicer area. His partner took over my care and was for sure competent but he died within 6-8 months, in his late 30s. That was almost 40 yrs ago. I’ve never had the same doc since for more than about 18 months and at the VA they seem to rotate every yr.
Ruckus
@Brachiator:
Having known an ER doc and having seen him at the end of a long shift I have no idea how that concept of top flight care got started. He is a good person and from what I can tell a good doctor as well, but 48 hrs with a catnap or two just isn’t enough to have him at his best. And this is a pretty common shift, he worked at two hospitals and that was his schedule at both.
Ruckus
@Mnemosyne (iPhone):
Moron probably doesn’t know that some people with decent care and cancer still don’t make 5 or 6 yrs, let alone with no care at all. I’d bet that is only one of the many, many things this moron doesn’t know.
Brachiator
@mb:
This is not true. The risk in the general population is about 1% and family history is important. And since there is no preventive treatment, regular visits to a family doctor doesn’t matter.
Most people don’t understand or can apply risk at all. This includes doctors.
The health care market is about as opaque as most others. But a sub-optimal choice will not usually be a fatal choice under ACA.
This is not elasticity of demand. And the one great flaw in your example: what if the heart surgery was in fact not necessary?
Brachiator
@Ruckus:
People can be amazing rationalizers. I guess they watch TV medical shows set in ERs and figure that this must be the best place to go.
Kylroy
@Thoughtful Today: Have you noticed nobody is disagreeing with you? They just have some practical problems they want help with, and you’re droning on about how they wouldn’t have these problems if the world were radically different. Not helping.
Thoughtful Today
Specifically:
Reduction in the 45,000 deaths annually from lack of health care is fantastic.
Elimination of deaths from lack of health care in America is your objective, correct?