Fixing Health Care

The price of health insurance continues to climb unabated. As the number of uninsured in America swells to 45 million people, many look to your political leaders for answers and relief. 

Presidential campaign rhetoric about how exactly to control skyrocketing medical care costs provides only short-term solutions centered on the sticker price. But the administration should address long-term solutions to the spiraling crisis. 

In 2002, the United States spent $1.6 trillion, or nearly 15 percent of GDP, on health expenditures. Medicare, the government's single payer model for seniors, spent $267 billion. 

Analysts project national health care expenditures to attain $3.1 trillion by 2012 - nearly twice the total amount spent in 2002. The dramatic numbers have a tendency to overstate the obvious - for a lot of, the cost of insurance is often as much, or even more, than rent or perhaps a mortgage. Until the administration places its focus on the rising cost of healthcare, those costs will continue steadily to escalate far exceeding the rates of earnings. Whether you subscribe to a greater monthly premium charged by an HMO or a payroll tax collected by Uncle Sam, someone has to pay for the bill. Shifting the burden from our premium bill to our tax bill isn't a suitable solution. 

You will find basic initiatives that policymakers need to address in an attempt to streamline the delivery system and minimize the soaring cost of health care. 

First, encourage investments in technology improvements across all levels of the medical care delivery system, including insurers, hospitals and physicians. For a $1.6 trillion industry in the 21st century, the technology employed is comparable to driving a Model T on a highway full of modern cars. 

Consider the banking industry. An easy bit of plastic, from any bank, lets you purchase anything from antiques on eBay to milk at the area grocery store. In healthcare, the bit of plastic serving as an ID card serves little purpose other than to inform the physician where you can send the bill. Physicians and their staffs then spend an inordinate timeframe completing the correct paperwork to get paid. 

Inefficiencies are expensive. Administrative expenses would be the fastest-rising element of health expenditures. In 2002, public and private insurance spent $105 billion on administrative expenses, almost 13 percent a lot more than in 2001. Support for developing common standards and technology improvements is important to eliminate the costly inefficiencies that donate to rising health costs. 

Next, support the release of cost and quality information. Most of us know where we can find a very good deal on an automobile, mortgage or even shoes. But how many people can afford to purchase something without ever knowing the purchase price? 

Are you aware the typical cost of a physician office visit? We've grown used to the minimal office co-payment since the benchmark for the cost of delivering care. Yet who would seriously look at a $10 co-payment a sufficient amount for physician treatment? 

As consumers, we're asked to bear a larger share of medical care costs. Inturn, we must demand more details about price and quality. Disclosure of such information has the potential to really have a profound impact on consumer behavior and the fee and quality of health care. Such transparency should reform inequities and deficiencies in the price of health services. 

There's not one magic bullet to solving the difficulties facing the American health care system. Our bodies is definitely an immense and complex web of interdependencies. Expanded public financing and subsidies will give you only short-term relief unless the drivers of healthcare expenditures are resolved. Solely addressing the problem by throwing additional money at it, public or private, while ignoring the elephant in the living room serves little to ease the large financial burden the medical care system has become. 

We ought to accept the fact that medical care in the United States is expensive and get to work with long-term solutions that will effectively control costs. We have the capacity to control healthcare costs in this country; what we lack will be the commitment and stamina to have it done.

Author Bio
JOHN R. CANTILLO is vice president of underwriting at Vista Health Plan Inc. in Hollywood, Florida. An industry expert with an increase of than 10 years of experience in health insurance, he received his MBA from the University of Florida. Cantillo is a member of the Health Underwriting Study Group, a national think tank and information source for medical health insurance executives. Reach him at (954) 965-3420

Educated Choice

How to control healthcare costs continues to dominate discussions among benefit administrators, chief financial
officers, CEOs, insurance brokers and health benefit companies. Whenever you lower your costs, your employees often react by thinking they will receive fewer benefits.

Offering a choice of plans, having a sensible contribution strategy and providing employee education can take costs down and satisfy employees.

Choice, choice, choice
Offering an option in benefit plans, choice in network access and choice in monthly costs are some of the best ways to help keep medical care costs affordable. Whether you've 20 employees or 1,000, look for a health benefits company that can offer you several plans for employees to choose from.

Typically, employers offer almost no choice in health benefit plans. Successful benefit administrators recognize that every employee has unique medical care needs. Why not offer employees 3 or 4 plans to choose from?

The level of benefits employees choose will relate straight to just how much they utilize health care services and what they are able to afford.

Most health benefit companies offer the following kinds of plans.

Traditional HMO
Lowest-cost plan, all care is coordinated with a primary care physician; employee must stay in network

Open access
A somewhat higher-priced plan allowing the employee the freedom to selfrefer to specialists in the network. More freedom equals a greater cost.

Point of Service (POS)
A less affordable plan for most, with more freedom; employee can access HMO benefits/network and/or pay higher co-insurance and choose any doctor

Preferred Provider Organization plan (PPO)
Greatest freedom, highest cost; total network access and out-of-network benefit, self-refer to specialist

Creating a contribution strategy
Given that you have chose to partner with a carrier that may offer your employees the choices they need, how do you stay within your company's budget? The solution is simple - be fair and consistent by implementing a definite contribution strategy that matches your company's budget. This process may be accomplished in two easy steps.

1. Determine what dollar amount per employee your organization can afford.

2. Select a carrier that can offer you four plans that'll satisfy your employees'healthcare needs.

Here's a typical example of how a defined contributions strategy could work for you (based on a health benefits budget of $180 per employee, per month).

In the example in the chart above, your company accomplished two extremely important goals: You controlled your company's costs
and you offered your employees choices.

With a defined contributions strategy, your employees are in charge of evaluating what they want and simply how much they're prepared to pay.

A choice of plans with a definite contribution strategy is two-thirds of the employer's cost saving equation. By the addition of employee education, you can visit a change in behavior that will lead to significant savings. The more informed employees are about the true cost of health care and how their choices directly affect their pocketbook, the much more likely they're to become "partners" in controlling costs.

Most health benefit carriers provide members having an Explanation of Benefits for all claims processed, which contains the price of services. Web-based tools offer plan information and are user-friendly. At workshops and mandatory open enrollment educational meetings, employees can speak directly with a carrier representative.

As medical health insurance premiums continue to increase and more employers face very difficult decisions, offering a choice of plans can keep your employees happy and satisfy your bottom line.

Author Bio
CATHY AGUIRRE, vice president of account services for VISTA, has a lot more than 18 years of experience in managed care marketing. Aguirre provides leadership for every one of VISTA's commercial accounts, including Broward County government, The School Board of Broward County, Broward Sheriff's Office, Miami-Dade Government, Sears, Walgreen's and United Airlines. Reach her at (954) 965-3471 or cathy.aguirre@vistahealthplan.com

Health Care Costs Rising

The expense of providing employees with medical health insurance coverage continues to increase at a double-digit rate. We've read a lot about cost drivers in healthcare - exorbitant hospital charges, rising prescription drug costs, expenses related to developing new technologies and treatments, an aging population and litigation. Nurturing these factors can be an environment in that the demand for health care seems to be increasing. 

For probably the most part, there is little employers can do to control what's driving healthcare costs out of the reach. Health benefits companies can and do negotiate discounts, and while those help, the underlying costs continue to skyrocket. The increases developed by these cost drivers flow through the health advantages companies and eventually trickle down to employers in the proper execution of higher medical health insurance premiums. 

In this soft economy, declining revenue is putting a squeeze on company expenses. It is likely that you will experience a 15 percent to 20 percent escalation in your group medical insurance whenever a renewal form lands in your desk. 

Is it possible to raise the price of your company's product or service as quickly as your health insurance premiums are increasing? 
Probably not. However, you will find steps you can take to get some control over your quality of life care costs. 

Finding a remedy

Employers can exercise some control over their costs by finding a health advantages company that gives the "best" value because of their company's premium dollars. The way in which you "shop" a health plan can impact the price. I'll use an analogy. Your travel agent has a good deal for you - air, car, hotel and meals included. You tell your agent to book it. 

Coincidently, your neighbors just booked that same trip for $1,000 less through their travel agent. One agent shopped to find the best price, one other agent arranged the trip through their vendor of choice. Whether it's a family group vacation, purchasing a car or choosing a health benefits plan, the manner in which you shop can impact your cost. Make sure that your insurance agent doesn't "arrange" your wellbeing arrange for you. Just how many providers are enough? The more participating providers a health plan has, the more you're likely to pay in premiums. If you should be considering a health plan that doesn't include a few desired physicians, request that the carrier add them to its network. 

Physicians take part in many different health plans and are usually ready to take part in one more. Don't get caught in the trap of paying 10 percent to 15 percent more for your quality of life insurance premiums because one or two doctors are notparticipating in the plan. It's reasonable an employee can find another physician from the thousands on the plan. 

The power of marketing

Residing in the United States affords us exceptional opportunities and choices. Along with this privilege comes a barrage of communications made to influence our decision-making. What we read in the papers, see on television, hear on radio stations, see flashed across a billboard, get stuffed inside our mailboxes or arises on the Internet is made to predispose us to an organization or its product. 

Marketing can be an effective tool, and depending how much is spent, could be very influential. What marketing cannot do, however, irrespective of simply how much is spent, is replace what it takes to develop an inexpensive health advantages solution that works for you. Be sure to choose a health benefits company that is flexible, listens and is willing to roll-up its sleeves to provide you with a deal of health benefits that you can afford.

Author Bio
PETER JOSEPH is senior vice president for commercial sales for VISTA, a health benefits company headquartered in South Florida with increased than 330,000 members. VISTA, through its affiliated companies, Vista Healthplan Inc., Vista Health Plan of South Florida Inc. and Vista Insurance Plan Inc., offers a range of health benefit plans including health maintenance organization (HMO), preferred provider organization (PPO) and point-of-service (POS). Reach him through VISTA's Web page at www.vistahealthplan.com or (954) 986-6255.

Emergency Room or ER: What's Right for You Today?

The Urgent Care Association of America estimates there are around 13,000 to 16,000 urgent care centers in the USA. Many illnesses and injuries that require timely treatment but are not true emergencies are ideally suited to evaluation in an urgent care center. If your individual physician is not available, a stop by at an urgent care center may provide convenient access to quality healthcare. In communities that do not yet have an urgent care center, the neighborhood hospital emergency department may be overrun with inappropriate visits--visits that involve relatively minor problems that could be better suited to the urgent care center. Urgent care centers are often a much better choice for on-demand use of healthcare, because urgent care centers generally:

have shorter wait times,


have convenient access in the neighborhood,


focus on caring for conditions of mild to moderate acuity (not the care of life-threatening emergencies), and


are equipped to care for more severe conditions than the typical primary care physician (offering x-rays, suturing, and administration of intravenous fluids).

On the other hand, some illnesses or injuries are not appropriate for treatment in an urgent care centers and must certanly be evaluated and treated in a hospital emergency department. Examples of these kinds of emergency conditions include:


a fifty year old woman with intermittent chest pain for days gone by twenty-four hours (may be a center attack),


a twenty year old girl with a fever of 104° who is not fully conscious and has an allergy over his body (may be meningitis),


a twenty year old man with severe neck pain after an accident on the highway (may be described as a fractured neck),


an seventy year old man who fell down a flight of stair and has not fully recovered from the concussion (may be a brain hemorrhage), and


a chemotherapy patient with a higher fever (may be a serious life-threatening infection).


Most non-life-threatening illnesses and injuries, however, can be evaluated and treated in a urgent care centers. Below are a few types of conditions that always present appropriately to urgent care centers:

a five year old boy with diarrhea for two days,


a forty year old man with rib pain after slipping in a icy parking lot,


a twenty year old man with burning on urination,


a four year old girl who tripped and has a painful ankle,


and a great many other mild to moderate illnesses or injuries.


Generally speaking, if you believe you may be experiencing an urgent situation condition, go to a hospital emergency department. If you're unsure, you may call your doctor or your neighborhood urgent care center to help you decide whether an urgent care center or a hospital emergency department is more appropriate.

To find an urgent care center in your community, you might try the following ideas:

Search the phrase "urgent care mycity"; (for example, "urgent care chicago") on a major se (Google, Yahoo or MSN).


Go the Practice Velocity urgent care directory on the Practice Velocity webpage (www.practicevelocity.com)


Try looking in your health insurance provider directory for urgent care centers that participate in your health plan.


Urgent care centers generally offer timely, convenient healthcare access. When you really need to view a physician today (and you can not be in to see your own personal physician) for an illness or injury that is not just a true emergency, an urgent care center may be a fantastic option as opposed to the emergency department.



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Where The Money Goes

As a small business owner, you've come to anticipate big increases in your employee medical health insurance premiums of late. Employer-sponsored health insurance premiums increased on average 11.2 percent in 2004, and this is the fourth consecutive year of double-digit growth, in line with the recent Annual Employer Health Benefits Survey released by the Kaiser Family Foundation.

That's about five times the rate of inflation nationally, and probably significantly higher compared to price increases your company has imposed on its products and services in once frame.

The reasons for these increases aren't mysterious. The greatest share of the ongoing increases track to increased utilization of advanced medical technologies - new diagnostic and preventive screenings, and other high-tech therapies and medical hardware - nearly all which are delivered at hospital on an inpatient or outpatient basis.

Prescription drugs also continue to play an important role in the rising cost of medical care, owing to the larger prices of new formulations, the wider application of combination therapies and greater consumer demand for, and need of, medications in most aspects of prevention and treatment. About the only real area that's seen relative stability is physician costs.

Such increases, when they are area of the costs of running your business, are naturally cause for concern. It only is sensible that employers who would like to continue offering their employees usage of quality healthcare become more proficient in how well their money is being spent by the healthcare carrier they choose.

For example, did you understand that virtually all carriers in Florida spend roughly the same percentage of one's premium dollars on medical claims - which works out to a medical loss ratio of 76 percent to 80 percent? They also spend a comparable percentage, 10 percent to 12 percent, on administering your plan (processing claims, providing customer support functions, covering fixed costs).

And all of the carriers element in a 2 percent profit margin. The total amount of one's premium dollars visit the commissions, which carriers pay to the independent medical insurance brokers who act as consultants. Brokers are, needless to say, a vital element in matching clients with carriers. Most business employers don't have the time or staff to determine the best package of benefits for their group, shop industry for bids and compare product offerings carefully.

They depend on the broker to explore the different options, let them have objective recommendations on the most effective choices and complete their applications. And brokers'services may often continue after enrollment. It's extremely valuable for employers to better understand where their premium dollars go. Don't hesitate to ask questions to totally recognize why one health plan may be preferred over another.

Employers can exercise some control over their costs by locating a health benefits company that provides the very best value due to their company's premium dollars. The method by which you shop a health plan can impact the price.

It's just like if your travel agent had a great deal for you - air, car, hotel and meals included. You tell your agent to book it. Coincidently, your neighbors just booked that same trip for $1,000 less through their travel agent.

One agent shopped to find the best price, one other agent arranged the trip through their vendor of choice. Whether it's a family group vacation, investing in a car or choosing a health benefits plan, the manner in which you shop can impact your cost.

Why are medical care premiums different? Take a closer look.