Health Insurance Hustle

Marshall Allen is one of the best, if not the best, healthcare reporter/journalist in the country. He currently writes for ProPublica, an independent and non-profit newsroom that produces investigative journalism for the public. ProPublica has won five Pulitzer prizes for its journalistic work.

Marshall began a series called Health Insurance Hustle a couple of years ago, and he methodically digs into why we pay so much more for healthcare in America. In early 2019, I had the privilege of contributing to one of Marshall’s stories, Behind the Scenes, Health Insurers Use Cash and Gifts to Sway Which Benefits Employers Choose. In that article, Marshall discusses the misaligned incentives that many “brokers” receive in our industry. Those incentives include things like bonuses, trips, overrides, vacations, and other hidden revenues that employers typically are unaware of. You can read our blog about that article HERE.

Another great piece Marshall wrote was a story about why health insurance companies don’t care about large health bills and why they over-pay for healthcare. In that article, Marshall tells the story about a man named Michael Frank, who had a partial hip replacement surgery and ended up before a judge, arguing about how Aetna had grossly over-paid the hospital for his surgery, which also left Frank with almost $8,000 of out of pocket costs. My biggest take away from that story: “The hospital and insurance company had agreed on a price and he was required to help pay it. It’s a three-party transaction in which only two of the parties know how the totals are tallied.” Boy isn’t that the truth!

Another great piece Marshall did was on a dear friend and colleague of mine, Marilyn Bartlett. Marilyn’s story is well-known in the healthcare world, and it earned her the distinguished title of one of the World’s 50 Greatest Leaders by Fortune Magazine. Marilyn helped save Montana’s state health plan from bankruptcy by demanding transparency from hospitals and doctors, then negotiating better deals. Other employers are now clamoring to follow her lead. I highly recommend reading this article!

A precursor to solving healthcare’s biggest challenges is knowing and understanding what is happening, typically behind the scenes. Healthcare represents approximately 20% of our nation’s entire gross domestic product. Imagine that…..It represents trillions of dollars annually, and studies reveal that 30-40% of that is waste, or unnecessary. A sobering figure for sure. These problems, or challenges, are solvable.

It starts on the payor side, and I’m not referring to the insurance companies. Calling the insurance company the “payor” of your healthcare is like calling H&R Block the payor of your taxes! They aren’t. They are merely an administrative middle-man, paying healthcare bills with our money! If you don’t believe that, take a look at the financial performance of the largest insurers in America, and tell me if they’re paying claims with their money…..

Self-funded health plans have opportunities to reduce healthcare waste, improve outcomes for employees, and restore value back into benefits. We tell stories all the time how we’ve helped reduce/mitigate the cost of care for clients and their plans. Just recently, we assisted a Texas County government reduce their healthcare spend by 31%, which amounted to over $600,000.

Getting proactive is how we do this. The majority of actual “care” is known before hand, it’s not emergent. Therefore it provides the opportunity to shop! Simple shopping in healthcare yields savings, yet very few people do it. Why? Because it’s not easy. We help our clients and their employees access high-quality healthcare at the lowest price possible, and in many instances, we’ve negotiated lower pricing for our clients before they ever need it. Things like MRI’s, CT Scans, Xrays, outpatient surgery, physical therapy, even high-cost prescription drugs.

The savings can be substantial, and with those savings, employers are discovering ways to reward employees for their good consumerism. One of our clients has decided to waive the employee’s deductible for good consumerism that leads to plan savings. One instance, an employee was going to have a hernia surgery at one particular outpatient facility, and the price was going to be $14,000 for the facility alone, not counting the surgeon and anesthesia. We steered the employee to an ambulatory outpatient surgical center, where we get better pricing, and the surgery price was reduced to $3,400. Because the employer’s self-funded plan saved over $10,000, the employer decided to cover the full cost of the procedure, and waive the employee’s out of pocket. Win Win!!

We all know healthcare is crippled, especially when it comes to transparency, prices, and insurance design. I highly recommend subscribing to Marshall Allen’s series Health Insurance Hustle to learn more about what is really going on behind the scenes. Then I urge you to take action. We all have a part to play in solving healthcare’s greatest challenges. Hope you’ll join us!