Insurance

from the Associated press - found via the Tennessean.com

Friday, 01/11/08
Consumer group says insurers overcharge

By MARCY GORDON
Associated Press

WASHINGTON — U.S. insurance companies systematically overcharge customers and underpay home and auto claims to pad their already-fat bottom lines, a consumer group said Thursday.

The Consumer Federation of America’s insurance director, J. Robert Hunter, said insurance companies have enjoyed robust profits and contained losses largely by “methodically overcharging consumers, cutting back on coverage, underpaying claims and getting taxpayers to pick up some of the tab for risks the insurers should cover.”

Hunter’s comments came with the release of a study by Consumer Federation, Consumers Union and several other consumer organizations that said the industry’s overcharges reached an average $870 per U.S. household over the last four years.

The loss ratio for property-casualty insurance companies, or the percentage of premiums paid out to policyholders as benefits, was 54.6 percent last year, according to the study, up from 53.3 percent in 2006 but far below the 75 percent level of the late 1980s.

Responding to the Consumer Federation report, the insurance industry’s biggest trade group defended the performance of its members.

“The absence of any major storm or earthquake has allowed insurers to post two modestly profitable years. But it wasn’t long ago, 2004 and 2005, when our industry suffered record natural-catastrophe losses,” Marc Racicot, president of the American Insurance Association, said in a statement.

“Our industry is highly competitive, and property-casualty insurance policyholders have more layers of consumer protection than virtually any other segment of the financial services industry. The rates consumers pay in each state must directly reflect the actual and expected loss experience within that one state, without exception.”

The study — based on insurance industry data and companies’ financial reports — estimates that the insurance industry’s net income after taxes in 2007 will be $65 billion, down from the record $67.6 billion set in 2006 but above 2005’s $48.8 billion.

Claims bring less

The industry has reaped those profits at the same time that consumers are receiving less money after filing claims, the consumer group said. A study released a year ago by the organization put forward similar conclusions.

Industry executives and experts, meanwhile, are predicting an erosion in profits this year amid punishing price wars and stable or reduced premiums.

“There is a distinct risk the market could self-destruct in 2008,” Rob Haines, a senior analyst at CreditSights Inc., said in a research note this week titled “Prelude to a Disaster.”

Evan Greenberg, chairman and CEO of commercial insurer ACE Limited, predicted a “marginal year” for industry profits at a conference this week in New York.

While most executives echoed Greenberg’s prediction, AllState chief executive Thomas Wilson said his company had found a way to avoid cutting prices with new products and expected to report an underwriting profit in 2008.

Consumer Federation advised consumers to carefully review insurance policies they buy or renew to see if deductibles or exclusions could force them to pay for wind damage, mold or other problems. For people who don’t live in coastal areas, the advice was simple: shop around.

“Insurers have reduced much of the risk they face, allowing them to earn record profits even in years of severe hurricane activity,” the report says.

One way companies have shifted risk, it says, is by not renewing policies in certain areas.

Um, is anyone surprised by this? I hope not. I am glad that there are some groups organizing for it though!

from yahoo news / Reuters

Over 40 million in U.S. can’t afford health care: report

Mon Dec 3, 5:57 PM ET

WASHINGTON (Reuters) - More than 40 million people in the United States say they cannot afford adequate heath care and go without drugs, eyeglasses or dental treatment, according to a federal report released on Monday.

The latest look at the state of U.S. health care also shows that while death rates from cancer and heart disease have dropped in recent years, just as many Americans are dying in car crashes.

“There has been important progress made in many areas of health such as increased life expectancy and decreases in deaths from leading killers such as heart disease and cancer,” Dr. Julie Gerberding, director of the U.S. Centers for Disease Control and Prevention, said in a statement.

“But this report shows that access to health care is still an issue where we need improvement.”

The report, available on the Internet at www.cdc.gov/nchs/, has a special section on access to health care.

Health care has jumped to the forefront of the 2008 campaign for the White House with virtually every presidential candidate offering some plan to provide more Americans with health insurance.

“In 2005, more than 40 million adults did not receive ‘needed services’ because they could not afford them,” the report said.

“Nearly 15 million adults did not obtain eyeglasses, 25 million did not get dental care, 19 million did not get needed prescribed medicine, and 15 million did not get needed medical care due to cost.”

The report found about one third of all children living below the poverty level had not visited a dentist in 2005, compared with fewer than one-fifth of children from wealthier families.

“The United States spends more on health per capita than any other country, and health spending continues to increase,” the report said.

“In 2005, national health care expenditures in the United States totaled $2 trillion, a 7 percent increase from 2004. Hospital spending, which accounts for 31 percent of national health expenditures, increased by 8 percent in 2005.”

Private insurance plans paid for 36 percent of total personal health care expenditures in 2005, while the federal government paid 34 percent, state and local governments paid 11 percent, and patients paid for 15 percent out of pocket.

Prescription drugs accounted for 10 percent of national health expenditure in 2005.

There was some good news: life expectancy was up to 77.8 years for a baby born in 2004 — three years more than in 1990. “Mortality from heart disease, stroke, and cancer has continued to decline in recent years,” the report said.

But the death rate for motor vehicle-related injuries has remained stable since the early 1990s, with 15 deaths per 100,000 people per year, down from 18.5 per 100,000 in 1990.

(Reporting by Maggie Fox)

Does it really matter to anyone that 40 million Americans can not afford health insurance? I’d say it is a tragedy if 12 Americans don’t have access to health insurance. It’s certainly a tragedy to the last 10 people I have seen seeking medical care without it. They were all horrible experiences for good people that would have a more production future, less stress and better overall health that would contribute to society much better if they could count on good health care regardless. I would like to think that there are 400 million Americans out there that are not happy about 40 million no having health insurance available to them. What are we going to do about this?

from Web MD

Buying Health Insurance on Your Own
Report: Most People Either Can’t Get It or Can’t Afford It
By Salynn Boyles
WebMD Medical News
Reviewed by Louise Chang, MD

Dec. 3, 2007 — Most people who try to buy health insurance on their own find that they either can’t get it or can’t afford it, even if they are relatively healthy, a yearlong investigation by Consumer Reports shows.

Of the roughly one in seven people surveyed who had no health insurance, 76% said they could not afford to buy it.

Only about 7% of those surveyed had purchased health insurance on their own, and 71% of these people were unhappy with their policies.

More than half cited high premium costs as a major reason for their dissatisfaction, and 45% said economic considerations had caused them to postpone needed medical care.

The report appears in the January issue of Consumer Reports, the publication of the nonprofit advocacy group Consumers Union.

“People who don’t have access to employer-provided health insurance are at an extreme disadvantage,” Consumer Reports Health Editor Nancy Metcalf tells WebMD. “We learned that private insurance is virtually out of the question for most uninsured Americans. This is a market that is completely dysfunctional from beginning to end.”
The High Cost of Good Health

Cumming, Ga., real estate agent Maggie Frazier is all too familiar with the problem.

Diagnosed with rheumatoid arthritis in 1988, Frazier tells WebMD that she was virtually crippled by the disease until powerful drugs became available to treat it.

“I was to the point where I couldn’t even comb my own hair,” she says. “That is how aggressive my rheumatoid arthritis was.”

She now takes injections of the immune-system suppressing drug Enbrel, at a cost of $1,400 to $1,700 a month.

Her employer-provided health insurance picks up most of the tab, but Frazier is about to lose this coverage because the plan is being terminated. Most private health insurers she has contacted wouldn’t cover her. The few that offered her insurance wanted to exclude her arthritis medications and any health problems she might develop related to her rheumatoid arthritis.

At age 60, Frazier now faces the economically ruinous prospect of paying for the drug out of pocket. She is also considering coming off the drug and going on full disability when her symptoms return.

“As long as I am on the Enbrel I am perfectly healthy. Most of my clients don’t even know I have rheumatoid arthritis,” she says. “But I’ve had the discussion with my doctor about what will happen if I have to stop taking it.”

Insurance Rules Vary by State

Frazier’s dilemma is increasingly common as individual health insurance becomes both harder to get and more expensive.

A big part of the problem is that rules for individual health insurers vary widely from state to state, Metcalf points out. Only a handful of states mandate coverage for everyone who seeks individual health insurance.

Most allow insurers to deny coverage for a wide range of common health conditions, including high blood pressure, migraines, asthma, and even acid reflux and hay fever.

“Most people have no idea that their situation could be entirely different if they move to another state,” Metcalf says.

She says people who take early retirement and move to sunbelt states often find themselves without coverage.

“These states generally have very poor consumer protection for people in the individual market,” she says.

Paul Ginsburg, PhD, who is president of the nonprofit Center for Studying Health System Change, says a major overhaul of the individual health insurance market will be needed to fix the problem.

“For the individual market to work, both sick and healthy people need to participate,” he says. “That is happening with group insurance, but not with individual insurance.”
Educated Consumers Have an Edge

While the deck is stacked against most people looking for private health insurance, becoming educated about the process can improve the odds for many.

The Georgetown University Health Policy Institute’s web site, www.healthinsuranceinfo.net, is one of the best sources of information about state rules regarding insurance for individuals, Metcalf says.

Other tips cited in the Consumer Reports investigation include:

* Be careful leaving your existing plan: Federal law allows you to extend your employer-based health coverage for 18 months after leaving a job by paying the full premium plus 2%. After that, the Health Insurance Portability and Accountability Act (HIPAA) may offer some protection.
* Research the market: Consumer Reports recommends the web site www.ehealthinsurance.com and your own state’s insurance department web site to research available plans.
* Get needed benefits: Make sure the policy you buy covers the health problems you have or are likely to face in the future.
* Look beyond the premium: Annual deductibles, co-pays for doctor visits, and prescription drug costs should be considered along with monthly premium costs.
* Don’t stop looking: People shopping for health insurance shouldn’t expect insurance sellers to tell them about their options, Metcalf says. Just because you are turned down by one insurer doesn’t mean you will be turned down by another. And you may be eligible for pool insurance available for those at high risk.

It is nice to have some people putting together facts and reporting what many of us, but obviously not all of us, already know. Health insurance is expensive, not having health insurance is expensive, and it’s tough out here for those of us without.

Just found this article via my pageflakes rss feed, I would like to hear some details form users of this group insurance option, if anyone has had any issues and such. This is of course a great idea, and perhaps it will catch on with self employed or small business men and women. I hope the group becomes more powerful and it responsible with the insurance money, and it continues to flourish.

I have seen several self employed or small business insurance opportunity over the years being advertised, including firms like blue cross and blue shield offering special plans, and I have seen many trade organizations like a DJ group called NACE or something, and I’m sure all new business owners have been contacting by one of the “small business group of America” type places that have all these benefits for joining the association.

This place featured in the article at Us news and world report appears to be well conceived and should be available to most anyone to join, I hope the benefits are good and it continues to grow in coverage and usefulness for everyone.

excerpt:

While acknowledging potential limitations, Freelancers Union founder and Executive Director Sara Horowitz says this is a start toward providing the 13.4 million self-employed workers—26 percent of whom were uninsured in 2005—the coverage they need. “Our strategy is to start with what we can do, and then start figuring out ways to improve things,” she says. Horowitz, a former labor organizer, founded an organization called Working Today in 1995 as a way to represent the growing number of independent workers. In 2003, that morphed into the Freelancers Union, which now claims 50,000 members and provides health insurance to 15,000 in the New York tri-state area. The union also offers other benefits like long-term-disability and life insurance.

To move its program nationwide, Freelancers Union partnered with Golden Rule, an affiliate of health insurance giant United Healthcare, to offer seven different plans. These run the gamut from traditional 80/20 coinsurance policies to newfangled high-deductible plans with health savings accounts, with a range of premium and deductible options. The union hopes it will eventually get enough people on board so that it can form larger risk pools that can use their numbers to negotiate coverage and rates. But for now, individuals must apply on their own (www.freelancersunion.org) and go through a medical underwriting process that involves answering a questionnaire about their medical history and conditions. “It may be that someone will be denied based on health,” says Ellen Laden, director of public relations for Golden Rule. Or instead of denying people outright, the insurer may refuse to cover anything related to a pre-existing condition, either forever or for a specified period of time. The premium may be higher as a result as well.

It often baffles me how people are so surprised that they have a deductible to pay when they need insurance. Whether it is a small $500 deductible that needs to be paid when you have a small car crash or fender bender, or if there is some kind of percentage that is needed to be paid when a doctor visit or hospital stay is necessary. I was surprised to find that my home insurance deductible was $1000 when a lightning strike caused a power surge that blow out almost every piece of electronic gear in my home, including the car door opener. I sure was glad that the computers, stereos, clocks and everything was covered by the homeowner’s insurance, but the $1000 deductible was shocking. I was also surprised to hear that my insurance company phone rep said that she alone takes about 100 calls a week fr lightning power surge related insurance claims.

The moral of the story is that you should be aware of what your insurance deductibles are before you need to use them.

If you have never used any insurance consider yourself lucky, and realize that the days are numbered before you will find out what it is like to have to use insurance.

I remember a time living without renter’s insurance and not ever really thinking about it. Sure I knew it was avaiable, I had heard of it somewhere, but when it comes time to paying the bills and having a few dollars left over to eat out or get extra insurance, a steak once in a while always won out.

I have talked with friends who wished they had renter’s insurance, and spoken with people in New Orleans that had insurance, but did not realize that some things (like floods) could happen and their insurance does not cover it. There are also many people (including myself) that never realize the whole to you are paying for insurance, that if you ever need to use it, you may not get the kind of payback you were expecting.