How often do health insurers say no to patients? (2023)
propublica.org
propublica.org
1. https://theonion.com/health-insurance-ceo-reveals-key-to-com...
The whole overhead imposed by the useless rent seekers is money not spent on making people healthier.
What do you imagine is the profit margin of a health insurance company?
According to this report by the national association of state regulators, the profit margin of the health insurance industry in 2023 was 3%, or $25 billion.
Compared to over $1T of premiums, and over $4T of total healthcare spending in the US, that doesn't seem "staggering" to me.
https://content.naic.org/sites/default/files/topics-industry...
Low margin, high volume is very different than low margin, low volume. The Walton family is very pleased with their tiny margins and the wealth it has delivered them.
This is the same way Medicaid/Medicare works too. Maybe they are the Neutral Good whereas insurance companies are the Neutral Evil.
This is substantively not true (though literally true at the level of a company, due to separate companies within the Kaier consortium) of the nation’s largest managed core organization, the Kaiser consortium consisting of the Kaiser Foundation health plans and the Kaiser Permanente Medical Groups.
> No when they deny coverage, they just keep all the premiums paid by the patient. That money is sucked up by the middle man. So you don't need to raise premiums, you need to lower profits at health insurance companies.
Something like limiting retained profits at the plan level to a fixed fraction of costs covered, and requiring refund of excess premiums to members?
The solution is to provide the medical services people bought the insurance to cover and not reflexively deny claims counting on at least some people to give up or die.
Really?
A big part of my job was to re-route people who needed wheelchairs into getting cheaper things. Our clients were United Healthcare, unions, large health insurers.
It sucked working there it was a total hellhole. I quit when they actually defrauded medicare. Their glassdoor reviews were wild. The owners daughter bragged about dating a glassdoor exec and that he would take down all the honest bad reviews for her.
The threatened “death panels” we heard about when ACA was being debated are actually employees of insurers who decide what they’re not going to pay for.
I was raised a die-hard capitalist and in many ways still am. When it comes to healthcare these days, I’m somewhere to the left of Marx. What we have now is a failed system. It simply does not work. The turnip has been squeezed and there’s no blood left to wring from it.
There’s no reason why this system has to exist. We can make it better any time we want.
There is no emphasis on long term planning or prevention.
Everyone is grabbing with both hands.
I would like to see #1 tried but at this point I’ll gladly accept #2
Because why would you ever only rely on some vague "US claims" instead of looking at reality?
I’ve tried on numerous occasions to get pricing quotes for healthcare both paying fully out of pocket, and for getting an estimate for what I’ll be left covering after insurance negotiates ads pays their part.
In every attempt I get absolutely nowhere price estimate-wise and wind get this or that procedure done just hoping and praying that the ultimate bill will be remotely reasonable
We’re so far off the mark for having a healthy marketplace for healthcare pricing that I just can’t see considering it dysfunctional to itself be an appeal to some purity.
Perhaps one might argue that a formerly functional healthcare pricing system will inevitably degenerate into this robber Baron situation that we’ve got currently, but otherwise I don’t see the no true Scotsman.
I don't know that "the US" has actually claimed this, but in any case any such claim is false. There are lots of reasons for that, but the key one is simple: the people getting care, patients, don't know how much it costs. You can't have a free market if the person receiving a good or service doesn't know the cost of what they're getting, and so can't judge whether what they're getting is worth what it costs.
For a market to work, the buyers have to be exercising their discretion. But most health insurance in the US is provided through employers (whose interests are different from those of the employees). There are a thousand other ways that the US healthcare markets are not free or poorly designed, but this is the original sin that (I would argue) causes most of the issues: the insured don’t choose their insurer, so the insurers are not competing for members, they’re competing for employers.
See Singapore for a place that actually tried. They have a public healthcare but also a well functioning private healthcare market.
These don't preclude a free market working well. For instance, they're all apt descriptors of me when I find myself needing an Uber home. I'm not completely inelastic, since I could take a series of long bus rides to get home, or walk, but accepting for the sake of argument those aren't life-threatening, the cab companies more or less have me over a barrel. Or do they? We all know what keeps them from charging me more they do, even given the time sensitivity, lack of prediction, or inelasticity. It's competition.
The USA system doesn't work well, and I'm not necessarily saying that free market is the right solution, just pushing back on the notion that just because a good meets those criterion we are forced to throw our hands up and say the free market could never provide that.
I know that most nights I am going to want to sleep in my own bed, this is somewhat inelastic sure, but not a surprise. The apps can’t raise prices too much however because they are in competition with us making plans to use the bus or call a friend. There is not a good equivalent in the medical world, it’s webmd and herbal compresses versus licensed doctors and prescription only drugs, with your life on the line.
Most health care is not like this. Most health care is fairly routine: periodic physical exams and checkups, or getting evaluated when you have cold or flu symptoms. These sorts of things are much better provided for in a free market.
It's true that, if you have an emergency, it's probably not something that could have been forecast, and you don't have much of a choice about what care you need. That is indeed the sort of situation that insurance is intended for. But what we call "health insurance" isn't limited to those things. It also covers everything else--all the stuff above that isn't unpredictable or time sensitive. The result is a mess.
> can’t search for my preferred cardiologist when I’m having a heart attack.
You can't search for your preferred mechanics when your breaks failed on a highway.
Yet somehow that didn't kill the competitive marketplace.
Meanwhile, this is the only heart I have, and if it’s in danger of stopping, I have approximately seconds to call 911 to get someone to come take me to the repair shop of their choosing.
Arguing against any attempt at competitive healthcare pricing because medical emergencies exist is a bit throwing the baby out with the bath water.
Naturally, hospitals also wants prices to be higher so they can earn more money.
I would expect this dynamic to play out whenever all the buyers in the marketplace are insurance companies.
The employees of the managed care organization are often just using the criteria of the payer (often times the federal or state government for Medicaid/Medicare/federal employee or other large self funded plans).
The US government leaders are in a good spot. They get the managed care organizations (MCOs) to take the heat for denying coverage, while setting the rules to deny the coverage. MCOs even get audited and fined for approvals that don’t meet criteria.
In any case, all systems with limited resources will have to have someone approving or denying payments, whether it be a government employee or someone contracted out by the government.
But the most salient metric here is all the MCOs earn only 2% to 3% profit margins. And their market caps are tiny, and returns abysmal. (Except UNH, but that is due to its significant provider and software business).
Blame MCO employees all you want, but you will be doing exactly what government leaders want you to do.
It is not at all surprising that capitalism fails miserably here, IMO.
The key insight, though, is that this is fundamentally unavoidable. Someone, somewhere has to decide how a limited healthcare budget will be allocated among all the various healthcare it could go towards.
You and I agree that it would be best to have a system where this is never the patient's problem. Someone determines a standard of care that will achieve the best patient results with the resources available, and then any patient can get whatever treatment's best for them within that framework. That's why I have and recommend Kaiser, they do a good job of presenting that abstraction.
Other people are terrified of the idea of having the standard of care determined by some centralized committee, because what if they decide a treatment that my doctor and I like isn't appropriate? I think the fear is wrong, to be clear, but it's genuine and does deserve to be addressed. Thus all the promises about "if you like your plan you can keep your plan".
(A third group of people believe that healthcare is only limited because of shenanigans, and with the appropriate reforms we could build a system where anyone is entitled to any treatment that might reasonably help them. I'm never quite sure what to tell them, since I don't think that's true but I don't know how to prove it beyond the lack of examples.)
The system is broken. It’s useless to extrapolate how things might work based on their current functionality. It doesn’t have to be like this. Everywhere else in the world manages it better than we do, and we’re not special snowflakes who require some hellish mashup out of Cyberpunk 2077 to take our kids to the doctor.
If that were true, why do people come to get health care in the US? (Because we have better healthcare and it’s free if you don’t have money or aren’t a citizen.)
As a Canadian I had the pleasure of my insurer (Canadian government) denying my treatment. Multiple appeals, still a no. My doctor said it was the only thing that would treat my disease. So my only choice is paying for it in cash at $10,000+ per month, which I can't afford.
I’ve found numerous instances where providers have billed over $5,000 for procedures that I could get for $250 if I paid cash. They do things like seperating a test panel into 100 different separate procedures, etc.
I think they need some context in the article of the interplay between providers billing practices to maximize their fees and insurer denials instead of just demonizing the insurance companies.
Every denial doesn’t result in a patient not receiving care, but is sometimes pushback against overly aggressive providers/negotiation and some of that can and probably should be automated.
Obviously them denying necessary treatment is really bad, but I find that propublica articles are often highly opinionated against certain interests and leave out a lot of context to create an extreme headline.
Sometimes certain things are covered before you hit your deductible other times not.
You're out of pocket $180 more than you should be, and paying the $20 cash price out of pocket means your deductible doesn't budge.
Universities need to get into the drug production business
The pattern is even more flagrant when done with post-facto billed services, since the price hasn't even been assented to. The whole medical industry has essentially normalized many different types of fraud against patients, and yet the industry is so entrenched that state/county AGs don't bother going after them.
After all the discount getting inflated by charging non-insured people ludicrous prices is the real issue but not one you can meaningfully complain about as an insured.
And unfortunately if you ask for pricing they will give you the inflated pricing meaning it isn't necessarily deceptive there.
It's even more glaring for post-facto bills from providers, because those prices are being presented on a cost-reimbursement basis (not contractual). The provider is essentially saying "You owe us $500 because that is what it cost to provide your care". But it obviously could not have cost $500 to provide the service, because they're happy to accept $150 in total.
Medicare/Medicaid tend to pay less than private insurance, however lots of places accept it because that gives them access to a bunch of potential clients.
Leveraging your user base to get a discount from a provider is normal and expected.
The problem is when insurance companies demand a particular discount and providers given them that discount by raising their prices.
Certainly a 70% discount is a sign of a bad price (assuming it isn't part of a cost normalization scheme where some services get deep discounts and others are paid with little or no discount aka "I get 70% off dangerous surgeries but I will pay 110% of simple ones")
However if instead the normal price was $200 and they accepted $150 to get access to the network that is normal.
One straightforward healthcare reform that could be done tomorrow would be to mandate that providers must charge the same price no matter who is paying, rather than the current behavior of operating pricing cartels in league with the insurance companies. This would work even if the government kept giving itself a pass by excepting Medicare.
My point is just that providers raising their prices to give insurance companies a bigger discount is a problem but getting a discount isn't itself flawed.
For better or worse in your hypothetical the uninsured price legally has to be $1,000 for medicine. They can write off part of that but no one would write off 99.8% as the insurance company would sue their pants off.
Oh, I agree. But it is.
> For better or worse in your hypothetical the uninsured price legally has to be $1,000 for medicine.
No, it doesn't.
https://www.nbcnews.com/health/health-news/cost-weight-loss-...
"In March, Novo Nordisk cut the price of all doses of Wegovy by 23% for people paying in cash, dropping it from $650 to $499 per month for uninsured patients or those without coverage. (The list price of $1,349 stayed the same.)"
"It follows a similar move from Eli Lilly, which reduced Zepbound’s starter dose to $349 and higher doses to $499 through its self-pay program, Lilly Direct. The discounted doses require patients to manually draw the medication from a vial with a syringe, adding an extra step compared to the prefilled injector pens."
There are entire businesses and apps built around figuring out which is cheaper, paying out of pocket or going through insurance. https://www.healthcaredive.com/news/goodrx-benefits-check-pr...
https://www.yahoo.com/news/no-one-knows-often-health-2020566...
> At the same time, posts on social media have been claiming that UnitedHealthcare’s claim denial rate is the highest in the industry at 32%. This figure comes from the personal finance website Value Penguin, which said it calculated that rate from available in-network data from plans sold on the marketplace.
Firstly, Luigi Mangione is presumed innocent until proven guilty.
Secondly, there's a fair amount of real evidence that Luigi is being set up as a scapegoat by the NYPD—a police department with a known history of planted evidence.
Second part: I’m not buying that for a moment. It’s way easier for me to believe that an individual working alone, screwed over by a megacorp who earns more based on how many people they can deny healthcare to, had enough and went vigilante. Vigilanteism and cold blooded murder are not OK, but it’s pretty easy to link cause and effect there. That’s vastly more likely than a shadow conspiracy that’s managed to keep its mouth shut so far.
What are people supposed to do? Vote? We voted for the public healthcare guy in 2008 and the powers-that-be decided they would rather back "muslim ban" demagogues than let that happen again.
I get this is your corporate-facing persona so you could never actually speak critically to this point, but the health insurance industry broke democracy, and eventually they'll find out what the alternative is.
But I’ll almost always be against vigilanteism outside extreme hypotheticals (“would you shoot Hitler?”). Even if I were morally ok with a specific instance, some time the person behind the gun might disagree with someone I support, and then where’s my moral ground to oppose their actions?
Edit: Furthermore, as much as I despise UHC and their leadership, I love the notion of our justice system more than I loathe them. When someone decides to be the judge and executioner, society devolves to “might makes right”. I served in Somalia. I don’t want to live there.
This does not contradict what I said.
I make no claims about just who or what the actual shooter was. I merely claim that it almost certainly wasn't Luigi Mangione.
"Arbeitsbeschaffungsmassnahmen" ( German for "employment creation scheme" ) in an industry where there is not enough actual work for--and or to justify the--number of employees. One of the more useful Ponzi schemes; if you are not a real capitalist, that is. Because if you are, then this shit is just fugly drag.
Blanket rejections are an extremly efficient measure from the perspective of an entity when the consumer has nowhere else to go and you don't care about ethics. Just tell them no and many people will just give up. If they appeal, you can invest the work to fob them off properly or just pay and not deal with the hassle. I can barely tell the difference with the many public healthcare insurers in germany - if my insurer were to try this nonsense, I would be gone the next month. Universities, some agencies and especially the god-damned GEZ on the other hand...
What frustrates me more, is that it often turns into a class indicator: Do you know how to word your letters or to handle yourself in a way that indicates, that it will be more annoying to not-deal-with-you than to deal-with-you? And if you don't: Do you have a access (network/money) to someone who does?
Oh, man. One could rant for hours about this. You are absolutely right. But in the end it's not really a class indicator because info about this particular and similar schemes could theoretically be packed into a weekend long workshop. In any small company or big factory, and definitely in schools as early as grade 10.
But it's a matter of character and you have to be damn lucky if you get a teacher who cares that much. Even neighbors will more often than not, NOT enlighten "the less fortunate" about stuff like this. It's pathetic.
But that's why this cascade works so well to keep almost all of the "more fortunate" under perfect societal control by which I don't mean some mythological conspiracy but "Steuerungsmechanismen" (some dude who got out of some cult beautifully explained this but I forgot both his name and the title of the book), keeping almost all of them in line, mostly silent, and alienated from the inter-generational usefulness of critical thinking.
And there is no irony in all this. Too many peoples mindsets never left the modern dark ages. One can only raise a brow and chuckle at all this.
It's a class indicator for sure, but, in my opinion, not class in the sense of hierarchies but of intellectual style, niveau. These tactics are low, like punching drugs.
it's worth noting that the healthcare system has a couple of antagonistic components and right now probably insurers are the only group actually fully happy with the situation. medical providers, pharmacists, and patients are all getting shafted.
- Through extensive lobbying, the US passed the HMO act of 1973 which requires that all employers offer an HMO plan to employees. HMOs were created to keep costs down, but United really took this to the extreme, making it as hard to use your health insurance as possible, and creating vertical monopolies like OptumRX. United takes so long to pay providers for the work they do that they now offer payday loans to doctors offices, which is crazy.
- The US uses a fee-per-service model that priorities procedures over preventative treatment or patient education. Some other countries have moved towards reimbursement based on health outcomes.
- The Affordable Care Act banned physician owned hospitals, which were growing in popularity and had better outcomes for less fees to patients.
- Private Equity is swallowing up hospital systems, emergency departments, etc. The most common seller is another PE firm, so they try to make a quick return through heavy cuts and then flip it 5 years later.
Aetna "forces" you into using its pharmacy by refusing to authorize any prescription with more than a 30-day supply unless through its wholly-owned pharmacy-by-mail subsidiary.
This should be illegal. I have read that UNH also owns around 10% of providers so they own the whole chain.
There also isn't much interest in improving healthcare from either side right now. The right has nothing. Their current platform is ignorant views about vaccines. The left has a stronger interest in Palestine and housing abundance right now, though all of that is dwarfed by trying to keep the rule of law going, and preventing us from falling out of a democracy. Healthcare is way way down the list for everyone sadly--even Bernie doesn't talk about it much anymore. The electorate has spoken, and they are not interested.
No insurance, none, of any kind.
I've got a Free h D in hillbilly medicine though. I've accomplished some amazing shit, but it's unraveling a bit now, and I'll be super surprised if I last much longer.
One can certainly say such a hit to morale is just collateral damage in the beautiful face of our wondrous mutant hive, but what are you guys gonna do when we start stinking up your streets en masse? One way or another, you'll be smelling the smoke.
Soylent Green is here. Read your labels carefully.
Proudly Made in the USA with Harshly Sourced Ingredients. I was free roaming though, if that matters.
Edit: returned to clarify that I was pulling myself up by me bootstraps. It's just that it's getting tough to hold on to em tightly enough. No shoes no service though, I guess.