SAN FRANCISCO (MarketWatch) -- For all the advances medicine has made in combating the sources of pain, the human spine remains one of the most recalcitrant.
Spending for back and neck problems grew 65% over eight years to almost $86 billion nationally, with prescription drugs the fastest-growing component, according to a new study in the Feb. 13 edition of the Journal of the American Medical Association.
But it doesn't appear to be helping people much. The portion of people with back or neck problems who said they had physical functioning limitations rose to 25% in 2005 from 21% in 1997, the study found.
"We're spending more on back pain than people thought, and at the same time we're not seeing commensurate improvements in health status that we should expect to see from investments in health care over time," said Brook Martin, the lead author and a research scientist at the University of Washington's Department of Orthopedics and Sports Medicine in Seattle.
The study examined annual federal survey data of 23,000 people, more than 3,100 of whom reported spine problems.
Back pain can come from a variety of sources, including natural aging processes, injury, excessive or not enough physical activity and carrying too much body weight. It affects most people at some point in their lives. Nearly 53% of patients surveyed in 2005 had nonspecific back disorders, a category that included spinal stenosis, back ache and sciatica. The second largest category was disk disorders with 16%.
source: Kristen Gerencher, MarketWatch
Friday, April 4, 2008
Tuesday, April 1, 2008
When health coverage gets taken away
SAN FRANCISCO (MarketWatch) -- A series of troubling developments in California's individual health insurance market is bringing national attention to the problem of patients having their coverage taken away when they need it most.
Last month, an arbitration judge ordered California-based health insurer Health Net Inc. to pay $9 million to a cancer patient whose individual coverage was canceled during her chemotherapy treatments in 2004. The judge ordered Health Net to repay $129,000 worth of Patsy Bates' unpaid medical bills and awarded the 52-year-old hairdresser $8.4 million in punitive damages and $750,000 for emotional distress.
It's not just Health Net that's attracting scrutiny. Blue Cross of California, a unit of WellPoint, the nation's largest private health insurer, drew fire recently for sending letters to doctors asking them to verify patients' accounts of their health histories in their applications after the company already had approved their policies. Blue Cross has since stopped the letter campaign.
California's Department of Managed Health Care, which regulates the state's HMO plans, has been investigating consumer complaints about unfair rescissions since 2006. The agency has fined both Blue Cross and Health Net and is in the process of reviewing the practices of other companies that sell individual policies in the state, spokeswoman Lynne Randolph said.
"We don't think it is only happening in California...but California's farther ahead in terms of enforcement," she said. "We had a statute in place that companies must do underwriting up front and a consumer must willfully misrepresent their health condition on an application in order for a company to rescind. We feel that means it can't just be an inadvertent omission."
Insurers say they have a responsibility to ensure applicants are truthful about any preexisting conditions they may have so companies can accurately price policies and hold down costs for all their members. But consumer groups warn that tactics such as tying financial incentives to the number of rescissions an employee makes or involving doctors in investigations after policies have been issued aren't working and may be illegal in some states.
There's growing consensus among consumer and industry groups that insurers need to set up independent third-party review boards to vet policyholders at risk of having their coverage rescinded and issue uniform, standardized application forms that make the process more transparent and fair for consumers.
Sandy Praeger, president of the National Association of Insurance Commissioners in Topeka, Kansas, said California's arbitration outcome and regulatory actions send a strong message to insurers trying to save money by digging up reasons to cancel policies retroactively.
"It's very good news for consumers," Praeger said. She condemned the practice of some insurers' offering bonuses to brokers who rescind policies. "They're making a lot of money collecting premiums. They need to honor those contracts."
Of course, businesses have to take reasonable measures to prevent fraud, which drives up the cost for all policyholders, she said. But the application forms can be ambiguous and loaded with medical jargon.
"I don't dispute [their] ability to drop someone who's intentionally lied," she said. "But to have policy language and application forms that are hard to understand and rely on a third party to explain them to you, it opens the door to people making unintentional mistakes. They shouldn't be held accountable for those."
The NAIC is devising a standard insurance application that could help reduce potential conflicts. Another idea states are examining is instituting external review processes like the one Kansas has for determining medical necessity for treatments that health plans deny, she said, noting that insurers' decisions get overturned in about half the cases.
Praeger praised the arbitration ruling as a "wake-up call" to insurers. "They could end up with more draconian rules and regulations and laws if these patterns don't reverse themselves," she said.
Aiming for solutions
Rescissions are rare, accounting for just 0.15% of individual policyholders' experiences in 2006, according to a survey from America's Health Insurance Plans (AHIP), a trade group of companies that cover 200 million Americans. About 18 million people have private, individual health insurance, the only kind subject to potential rescissions.
AHIP President Karen Ignagni said the group called for more-stringent rescission criteria and independent review panels in a December report. "We recognize the process needs to be very transparent and people need to have peace of mind that they will have an independent review.
"As states adopt this proposal, they'll have a place where they can have these cases vetted external to the health plan," she said.
Because of recent events, some lawmakers in Sacramento are considering greater consumer protections for people in the individual insurance market. Los Angeles City Attorney Rocky Delgadillo recently filed a lawsuit against Health Net alleging that it engaged in unlawful or deceptive business practices related to improperly canceling customers' policies.
Health Net is making changes and organizing an independent third-party process to review possible rescissions, spokesman David Olson said. "We're not going to rescind any policy until that process is in place."
Still, he disputes the characterization of the company's former incentive-pay program and says its business practices are sound.
source: article by Kristen Gerencher, MarketWatch
Last month, an arbitration judge ordered California-based health insurer Health Net Inc. to pay $9 million to a cancer patient whose individual coverage was canceled during her chemotherapy treatments in 2004. The judge ordered Health Net to repay $129,000 worth of Patsy Bates' unpaid medical bills and awarded the 52-year-old hairdresser $8.4 million in punitive damages and $750,000 for emotional distress.
It's not just Health Net that's attracting scrutiny. Blue Cross of California, a unit of WellPoint, the nation's largest private health insurer, drew fire recently for sending letters to doctors asking them to verify patients' accounts of their health histories in their applications after the company already had approved their policies. Blue Cross has since stopped the letter campaign.
California's Department of Managed Health Care, which regulates the state's HMO plans, has been investigating consumer complaints about unfair rescissions since 2006. The agency has fined both Blue Cross and Health Net and is in the process of reviewing the practices of other companies that sell individual policies in the state, spokeswoman Lynne Randolph said.
"We don't think it is only happening in California...but California's farther ahead in terms of enforcement," she said. "We had a statute in place that companies must do underwriting up front and a consumer must willfully misrepresent their health condition on an application in order for a company to rescind. We feel that means it can't just be an inadvertent omission."
Insurers say they have a responsibility to ensure applicants are truthful about any preexisting conditions they may have so companies can accurately price policies and hold down costs for all their members. But consumer groups warn that tactics such as tying financial incentives to the number of rescissions an employee makes or involving doctors in investigations after policies have been issued aren't working and may be illegal in some states.
There's growing consensus among consumer and industry groups that insurers need to set up independent third-party review boards to vet policyholders at risk of having their coverage rescinded and issue uniform, standardized application forms that make the process more transparent and fair for consumers.
Sandy Praeger, president of the National Association of Insurance Commissioners in Topeka, Kansas, said California's arbitration outcome and regulatory actions send a strong message to insurers trying to save money by digging up reasons to cancel policies retroactively.
"It's very good news for consumers," Praeger said. She condemned the practice of some insurers' offering bonuses to brokers who rescind policies. "They're making a lot of money collecting premiums. They need to honor those contracts."
Of course, businesses have to take reasonable measures to prevent fraud, which drives up the cost for all policyholders, she said. But the application forms can be ambiguous and loaded with medical jargon.
"I don't dispute [their] ability to drop someone who's intentionally lied," she said. "But to have policy language and application forms that are hard to understand and rely on a third party to explain them to you, it opens the door to people making unintentional mistakes. They shouldn't be held accountable for those."
The NAIC is devising a standard insurance application that could help reduce potential conflicts. Another idea states are examining is instituting external review processes like the one Kansas has for determining medical necessity for treatments that health plans deny, she said, noting that insurers' decisions get overturned in about half the cases.
Praeger praised the arbitration ruling as a "wake-up call" to insurers. "They could end up with more draconian rules and regulations and laws if these patterns don't reverse themselves," she said.
Aiming for solutions
Rescissions are rare, accounting for just 0.15% of individual policyholders' experiences in 2006, according to a survey from America's Health Insurance Plans (AHIP), a trade group of companies that cover 200 million Americans. About 18 million people have private, individual health insurance, the only kind subject to potential rescissions.
AHIP President Karen Ignagni said the group called for more-stringent rescission criteria and independent review panels in a December report. "We recognize the process needs to be very transparent and people need to have peace of mind that they will have an independent review.
"As states adopt this proposal, they'll have a place where they can have these cases vetted external to the health plan," she said.
Because of recent events, some lawmakers in Sacramento are considering greater consumer protections for people in the individual insurance market. Los Angeles City Attorney Rocky Delgadillo recently filed a lawsuit against Health Net alleging that it engaged in unlawful or deceptive business practices related to improperly canceling customers' policies.
Health Net is making changes and organizing an independent third-party process to review possible rescissions, spokesman David Olson said. "We're not going to rescind any policy until that process is in place."
Still, he disputes the characterization of the company's former incentive-pay program and says its business practices are sound.
source: article by Kristen Gerencher, MarketWatch
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