The cost of health insurance is a significant issue for business owners, employees and families that purchase their own coverage in California.  I often receive information outlining costs and industry trends.  I thought it would be helpful to share some f this information to point out the cost drivers.

-Medical price inflation is driving 51% of the growth in medicare care spending

-Doctors in the US earn 2-3 times as much as other industrialized nations.

-More doctors are becoming specialist which charge twice as much as general and family doctors.  As an example between 1997 and 2006 compensation increased 97% for dermatologists, 78% for gastroenterologist and 65% for radiologist.

-Between 1997 and 2007 prices for prescription drugs grew at a rate of 2.5 times the rate of inflation.  There are some cancer drugs that cost $100,000 per treatment.  In the US half of the entire population takes at least 1 pill per day!  7% take 5 or more and 2/3 of all patients that leave a doctors office leave with a prescription.

-Life Style Factors: 10% of all claims are do to obesity; 25% of Americans smoke and 10%  all claims are due to smoking related illnesses. 60% of all Americans don’t exercise

Sure we can all blame the insurance companies for raising our rates. But, maybe we need to look at ourselves as part of the cause and the SOLUTION?  Remember that the health insurance model is based off the healthy people’s premiums cover the sick folks because their premiums are often nullified by claims.  If there are too many sick the carriers need to raise premiums to cover claims and have required government mandated reserves.  Blue Shield and Kaiser are non-profit and their rates are rising as quickly as the “for” profit carriers.

-Government regulations and mandates forcing carriers include comprehensive benefits without cost sharing.  For example preventative care is covered 100% without a co-pay. Prior to Health Care Reform it was a co-pay benefits.  The member would pay $30 (or whatever their co-pay is) and the carrier pays the balance. Now it is 100% carrier and times 350 million people that is a lot of money which then must be passed on to the rate payers to cover the claims.

Hope this helps. If you still have questions you can always call my office at 877-840-0554

Don Ariosto-Owner

CIF Insurance Agency Inc.

Frequently I get similar questions on very similar topics.  Although no questions are bad or stupid questions, I have come to realize that social media may be the perfect media to “get the message out”.  So, with the help of a social media professional we put the (3) pillars together. Which are:

Face Book: http://www.facebook.com/?ref=logo#!/CaliforniaInsuranceFinder  **Please click on the “LIKE” widget at the top and you can follow my posts.

LinkIn: http://www.linkedin.com/profile/view?id=12064942&trk=tab_pro

and

Twitter: http://twitter.com/#!/CIFInsurance

I am also in the process of a major update to my own site at www.CaliforniaInsuranceFinder.com where all four will be LINKED together.

Thanks

Don Ariosto-Owner

CIF Insurance Agency Inc.

As the US Senate weighs and debates it 2,074 health care “reform” bill let’s take a brief look at how the Medicare and Medicaid “scoreboard” look right now.  California Health Insurance and the Obama Care legislation will affect how these plans move forward.  According to FEDERAL statistic fraud devours some 60 billion (that’s right billion) or 13.3 percent or Medicare’s $452 billion dollar budget.  One thief told Steve Kroft “60 Minutes” that he personally robbed 60 million dollars and he could have easily took 100 million.  He was quoted as saying it was “really easy” to steal patient names, doctors name and just start billing the Federal government for fictitious services and devises.  If you think health insurance is expensive now-wait until it’s free and the thieves get their claws into the new program.

Medicare failed to investigate frauds and in many cases where the members (who received their explanation of coverage and never received the services or devises) called Medicare and reported the fraud.  Additionally, Medicare continues to be one of the slowest “payees”-according to the Athena Health Payers View report.  North Carolina is the fastest state at 40 days.  Among the top payees it ranks 8th and in some states takes 77-89 days to pay providers.

Additionally, Medicare also ranked among the highest payees in rejecting claims.  In California Health Insurance Medicare and Medicaid rejected 19.5% while NY rejected 34% and Florida 38%.

Last year even the Post Office lost 2.5 billion dollars.

Folks as the 2000 page healthcare bill makes it’s way through the Senate we need to be aware that if this bill passes it will be more costly than budgeted, will be filled with administrativered-tape, be stifled with delays and problems and surely have a tremendous amount of waste and fraud.

Why do I say this?  Because the government can’t run their existing programs efficiently and on budget.

Your comments are appreciated.