Blog

Under the ACA preventative care was free. At least there was no charge to the insured at the time they received the exam, the cost was built into the premiums. The argument was that an advanced diagnosis would save long term medical costs because illnesses would be caught at an early stage.

If we use that same argument to create “health Insurance as it should be” there are three key strategies that would prove to be very effective.  Here they are and here’s how to use them. (1) Preventative – Individuals have a responsibility to be examined at least periodically (every two years, yearly as we get older – I’ll let the AMA set the standard) and get their immunizations. Those that do receive a lower insurance premium. (2) Wellness / Biometrics – Smokers should be charged more (no need to argue why, everyone should be aware of the added health risks and costs). Lower premiums or premium rebates for those actively managing and meeting standards for blood pressure, BMI, cholesterol and blood sugar level. All are key indicators of health. It makes sense to provide a premium discount to the individual going to the gym or utilizing some other method to improve their health. Those that don’t should pay more. After all, they are costing everyone else more. (3) Genetics & DNA – Technology is a great tool. Let’s use it to help predetermine the medical conditions which we’re predisposed. Not to punish people with higher costs, but to be proactive. A lifestyle change at an early age could help prevent certain illnesses. Information can be kept confidential with case managers and not shared or used with underwriting. – i.e. If you knew you had a family history of cancer, breast or colon, you could be proactive and monitor the signs. Same principle for other genetic diseases.

Let’s use all the available resources to lower health care costs and create a proactive system, health insurance as it should be.

What ideas do you have?

Employee Benefit Advisors provides employee benefits, tax-advantaged healthcare, compliance guidance for ACA and Health & Welfare DOL Audits, and PEO Advisory & Consulting Services. We can customize a wellness plan for your budget and culture.

Much speculations evolves around what changes the Trump administration will bring to health care. Although I don’t know why. The basics have been laid out by the Republicans for months. There is some fine tuning that needs to be done, but the core is in place. In addition to the principles that have been laid out, here are a few well thought out suggestions.  (For a closer look at what’s been proposed go to my July 13^th and 27^th blogs, Repealing Obamacare – Individual Tax Credit & The Employer Tax Exclusion.)

What part of the current healthcare reform plan would I keep? Once Obamacare is repealed, it must be repealed, my primary complaint is the ACA was implemented as a regulatory law not a health advocacy tool, I’d reintroduce three things. (1) No one should be denied coverage due to preexisting conditions. However, no one should be allowed to burden the system who carries no insurance, goes to the doctor, learns they need medical care and now applies for insurance. They should be required to apply for insurance, bear a heavy portion of the medical expenses for a year or two (contracted rate), and have the carrier assign a case manager. (2) Keep adult children on the plan until age 26, unless they are employed full-time. Then it’s time to put their big boy & girl pants on and be a responsible adult. (3) The Summary of Benefits & Coverage and Glossary of Health Coverage & Medical Terms make it easier to understand coverages. However changes need to be made.

Whatever happens I hope we’ll see both the introduction of individual tax credits and the continuation of the employer tax exclusion, rightfully so. Both are integral to health care. Why individuals have not been able to deduct health insurance premiums is a mystery. The need to continue the employer tax exclusion is important because the vast majority of Americans receive coverage through their employer. Suddenly thrusting 170 million people into the individual market would be chaotic. Also, the employer resources can be provide health advocacy for the employees (independently contracted, through HR or the broker).

Here are some simple solutions that will make health insurance easier and better.

• Paying for Preexisting Conditions – Every transaction, buying aspirin, medical procedures, hospital stays – anything medical related – should be charged a ‘PreX’ fee of 1 penny. The money would go towards funding preexisting conditions, nothing else. If it raises more than is needed, then cut it back to either ½ penny or only on certain purchases or procedures. (Need to have the bean counters look at this recommendation.)
• All medical expenses (premium included) should be pretax. Do I really have to explain why this is good/fair? If health care is as important as everyone says, and it is, let’s make it as inexpensive and accessible as possible to all. Eliminate all the complex tax regulations around health insurance, especially the need to have 7.5% of income before receiving the current deduction. (Note: It’s a deduction not a tax credit.)
• Everyone should be eligible for HSA accounts and eliminate FSA accounts. Why have the use-it-or-lose-it rule? Makes no sense, except the federal government is overly concerned about the tax revenue. Although medical expenses would be pretax, based on my recommendation above, the HSA account would continue pretax deductions with tax free expenditures for medical care. HSA accounts would incentivize people to finance future medical expenses. What should be the allowable limit for HSA contributions? It’s open for discussion, but a dollar amount equal to the plans out-of-pocket maximum would make sense.
• Any able body, able mind,  receiving a government subsidy for health care (Medicaid) should be required to do some form of work, be it ever so menial. Health insurance is expensive, everyone can do their part.
• Major changes to medical liability and malpractice need to be made. I’ll let others suggest specific tort reform recommendations. But we need to get the attorneys to give up their strong hold on the medical market. It’ll help lower costs.

Finally, before you suggest eliminating insurance companies, I hope you’ll think about the import role they play in lowering health care costs. Health insurance companies, just like many items you buy, negotiate rates, buy in bulk, and monitor expenditures. Need proof? Look at your EOB (Explanation of Benefits). Compare the original billed amount to the allowed amount (after discounts).

I’m not saying they are perfect or that changes can’t be made. I’m just saying they play an important role and we need to recognize it. Insurance companies are much better than a bloated government agency with little or no accountability. We tried that with the VA health care and Obamacare. – No thank you!

What ideas do you have?

Employee Benefit Advisors provides employee benefits, tax-advantaged healthcare, compliance guidance for ACA and Health & Welfare DOL Audits, and PEO Advisory & Consulting Services. We can customize a wellness plan for your budget and culture.