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Medical Costs Bankrupt Patients; It's the Computer's Fault
nbauman writes "Don't get cancer until 2015. The Obama health reform is supposed to limit out-of-pocket costs to $12,700. But the Obama Administration has delayed its implementation until 2015. The insurance companies told them that their computers weren't able to add up all their customers' out-of-pocket costs to see whether they had reached the limit. For some common diseases, such as cancer or heart failure, treatment can cost over $100,000, and patients will be responsible for the balance. Tell me, Slashdot, how difficult would it be to rewrite an insurance billing system to aggregate a policyholder's out-of-pocket costs? 'A senior administration official, speaking on condition of anonymity to discuss internal deliberations, said: "We knew this was an important issue. We had to balance the interests of consumers with the concerns of health plan sponsors and carriers, which told us that their computer systems were not set up to aggregate all of a person's out-of-pocket costs. They asked for more time to comply."'"
The rollout is being delayed until after the 2014 congressional elections. The problem is political, not technical.
quiquid id est, timeo puellas et oscula dantes.
We knew this was an important issue. We had to balance the interests of consumers with the concerns of health plan sponsors and carriers, which told us that their computer systems were not set up to aggregate all of a person's out-of-pocket costs.
So what's on the other side of this "balanced" solution?
My current plan already does this and I'm certain it's a basic tenet of all medical insurance plans. After all, most people choose a plan by balancing the up front premium costs with the out of pocket costs on the backend. Der, someone is fibbing. X-/
So instead of just doing the paperwork on paper(or excel) theyre going to let the patients die if they cant cough up the cash, because the insurance company doesnt want(or cant) do 6th grade math.
Today your government is brought to you by PepsiCo and Corrections Corporations of America, Low on regulation and high on regulatory capture.
It's just another example of bought and paid for politicians sucking the dick of corporations. The famous words "of the people, by the people, for the people" are such a sick joke if you look at the USA government. Coming from a country that covers 100% of such common procedures, I just can't imagine how people can live like that. And Americans still think they have the most superior country in the world. America! Fuck Yeah! Please stop spreading your ideas of freedom to the world and try spreading those ideas at home instead.
Tell me, Slashdot, how difficult would it be to rewrite an insurance billing system to aggregate a policyholder's out-of-pocket costs?
That depends entirely on whether the insurance company wants to remain in business or not. Next question.
#fuckbeta #iamslashdot #dicemustdie
How the heck does this happen?
Technical people don't understand politics.
As long as the payers for service and consumers of it are different entities, this sort of nonsense will keep happening.
Does your scheme include room for the risk-pooling functions that people tend to like in situations with low-probability very-high-cost possibilities?
I'm not sure that there is a worse implementation of insurance than our present one; but a medical payment system without some provision for risk-pooling is DOA.
Which is what Obama has wanted since day one.
1) Pass a bunch of rules with an unreasonable compliance schedule that no insurance company on Earth could hope to meet
2) Blame insurance companies when the new "free healthcare for all" law fails miserably
3) Use it as an excuse to ram single-payer down everyones' throats
4) Government now has the power to decide who lives and dies, based on political ideology, which is what leftist despots like Obama want.
By what legal authority did Obama delay this implementation?
Do you have ESP?
So what is the opposition party alternative? Repeal.
That will limit the out of pocket costs when? Never.
Plus it will eliminate the various positive effects that the ACA is already having.
Basically the people that are screwing up here are the beneficiaries of the higher out of pocket costs, our Medical Insurance Overlords.
Easy answer on this one from someone who has worked in the insurance industry for a few years... the systems suck.
I am not defining 'suck' from the standpoint of performing because they do what they need to... however they become so bloated with complexities that even minor changes seem daunting. No person or team in my organization knows how the systems work from end-to-end and even the vendors need to use reverse engineering to resolve issues because of the complexities.
Not unusual for an insurance company to build a new system to support new plans because integration of the benefit rules into an existing system is not worth the pain. In the end the company ends up with several systems and IT silos built up around them.
The system at my current work will not be able to handle tracking co-payments over any period of time. The jobs that run overnight to price claims and track this sort of thing are already running at capacity.
On top of all this the executive management in this industry tend to be incredibly conservative and avoid risks like the plague.
Well damn, better go tell Microsoft to stop making Excel... *facedesk*
Go ahead and try to put health data into Excel without violating HIPPAA and going to jail. The same medical procedure can be billed at hundreds of different rates, depending on numerous criteria, many of which are covered by privacy laws, or are calculated by third party labs or testing facilities. If you really think this is easy, then you don't have a clue. There is a reason that we spend 2 trillion a year on health care, and if you compare America's longevity, infant mortality, etc. to other countries, it is pretty obvious that all that money isn't being spent on actual effective medicine. My family doctor's office has one doctor, two nurses, and four people in the billing department.
Businesses exist to maximise profits, all profits, even those derived from delaying compliance activities. It becomes a simple cost benefit case. Is it cheaper to pay some politician's wage and go moan about how hard it is for your one programmer to re-write the software within a timeframe, or is it cheaper to simply hire the right number of people to do the job properly and quickly.
The answer is nearly universally the former. Major companies (not just healthcare) will rather moan about how hard done they are by the government than actually step up to comply with the new regulations. If a large fine is linked with non-compliance they'd have the software modified by the end of the month.
I've seen similar cases in industry too. Companies will replace truly horrendous parts of their plant like-for-like because installing what they want is tied with meeting the new standards of the day rather than the easier standards of when the equipment was originally designed, and thus we have a plant basically half replaced as new with no gear that meets any modern emission standards.
There's simply no motivation to go down the more expensive route.
An old programmer once told me that insurance companies run on OpenEdge (aka Progress), and old versions at that.
Gigabytes of proprietary spaghetti code <<shudder>>
I'm not putting my hand up to fix that.
Step 2 is an immediate response, step 4 is handled in batch processing nightly. So far so good. Except that the Affordable Care Act makes it *illegal* to make a patient pay more than the annual limit. The authorizer and/or the pharmacy can be charged for forcing the patient to pay above the annual limit. This means that the authorizer must be aware of limit of each patient and be able to respond in real-time so that neither they nor the pharmacy will be sued. The insurance company doesn't have that information available real-time, nor do they make it available to the authorizer.
It is a computer issue, but as simple as everyone thinks. Putting individual insurance files on-line so that the out of pocket expenses can be tracked real-time isn't trivial. Now, maybe the Insurance companies were hoping the law wouldn't be implemented so they didn't do the hard work necessary to get set up, or maybe the rules were only written as to how to handle the annual limit must be handled.
Just remember, the last time companies put together a real-time on-line credit/debit system, the government decided that they charged too much to support the infrastructure, and started regulating it. That was the Durbin amendment to Dodd-Frank, which put a fixed limit on per swipe fees - regardless of what the infrastructure and support costs actually are.
jerry
"Software is the difference between hardware and reality"
Tell me, Slashdot, how difficult would it be to rewrite an insurance billing system to aggregate a policyholder's out-of-pocket costs?
It's somewhat more difficult when you waste three years assuming the Republicans are going to win big in 2012 and repeal the whole ACA. You gamble, you lose.
Snark aside, the real answer seems to be in the article:
The health law, signed more than three years ago by Mr. Obama, clearly established a single overall limit on out-of-pocket costs for each individual or family. But federal officials said that many insurers and employers needed more time to comply because they used separate companies to help administer major medical coverage and drug benefits, with separate limits on out-of-pocket costs. In many cases, the companies have separate computer systems that cannot communicate with one another.
So insurance companies outsourced different parts of their work to different companies that don't talk to each other. It's not "the computer's fault", it's an administrative problem within the insurance company itself. That text was right above the paragraph quoted in the summary, but curiously the submitter felt the need to ask a rhetorical question instead of including the most important piece of explanation in the entire article.
(Also, have you ever heard a story about a giant years-old financial/billing system that was clean, well-implemented, and easy to maintain and modify? I sure haven't. Not sure why we'd expect anything to be a trivial change in one of those...)
Visit the
The USA health care system has some of the worst possible perverse economic disincentives. At literally no point is there a clear economic incentive for you to be healthy and taken care of.
1) Consumers have no interest in keeping costs down. They pay the same deductible no matter what happens. Unfortunately, this is only up to a point (see #4 below) but that's not going to enter casual consideration.
2) Hospitals have no interest in keeping costs down. They blatantly inflate their costs knowing that the insurance companies will only pay a fraction anyway. They also have no incentive to keep supplies costs down since they are paid "cost +" by insurance companies. They'll tend to buy whatever sponge or soap dispenser is in "the catalog".
3) Providers of supplies to hospitals have no interest in keeping their costs down. Hospitals get paid on a "cost +" basis by the insurance companies so charging $35 for that "medical grade" sponge that cost them $0.35 wholesale has 99% profit margins as its incentive.
4) Insurance companies have some incentive to keep costs down, which they generally do by axing their most expensive customers with any of the myriad of technicalities written into their eye-gouging 10 page contracts full of inverted double negatives and exceptions. A good example is somebody with a job who gets cancer. Sure, he/she may have excellent health insurance, but what about when he/she loses his/her job because they didn't show for four months while undergoing chemo therapy? Even so, the myriad of regulations in place (and a legal department that ensures that one plan can't be compared to another) provides an opaque enough service offering that customers are unable to distinguish which plan is actually "cheaper".
5) Doctors had to just about kill their mother to get through medical school, and are saddled with enough debt to make anybody contract stress-related symptoms. Since they get paid for the work they actually perform, they have every incentive to declare a medical emergency and take you under the knife, regardless of whether or not it's necessary or even beneficial. I'm not saying every doctor will give you heart surgery when you come in with a rash, but I'm not alleging something that doesn't happen. Citation 2.
The majority of bankruptcies in the United States are for medical reasons, and the majority of *those* are by people who had health insurance at the time they got sick. Anybody who says this ridiculous would-be-laughable-if-it-wasn't-true system is lying or misinformed.
I have no problem with your religion until you decide it's reason to deprive others of the truth.
Typical 'merican outrage over a perceived yet fictional generalization. Face it middle America, you will never be rich so stop blindly supporting policies you think will some day benefit you. You are only hurting yourself. The lazy American sucking off the tit of society that you are so scared of is either you today or you in the near future. You are unsophisticated, undereducated, and unprepared for the future and that is just the way they want you and imaging, chances are, you live your life through part of the 60's. You had the great privileged to experience some of America's fat years, as long as you were white and somewhat educated. Those days are not coming back and your children will have an ever increasingly hard time.
Competition not regulation? Let's do away with the middle men, the only way true competition could work if the consumer deal directly with the provider. No insurance company! The insurance company acts as an arbiter that artificially raises the prices to the consumer, their negotiated prices are usually much, much lower than what we as the consumer can get the services.
What? Too simple for you? I guaran-fucking-tee you that if you put this mechanism in place, the insurance companies would suddenly discover that they can, in fact, figure out how much you've been billed over the time period in question. "Oooh! THAT billing info! We just need to look in this computer for THAT!"
I'm trying to teach myself to set people on fire with my mind... Is it hot in here?
HR 676, Medicare for All would be simpler and cheaper.
My computer isn't set up to pay the bills. It isn't set up to pay the penalties for not paying the bills either. I was too busy programming an interface to my asset protection plan. It's beautiful. You should see it. Rounded corners and everything, and the interest on my overseas accounts is lined up in formatted columns and everything. It doesn't do medical billing outlays though. So sorry. I'm sure you'll understand.
For all intensive purposes, "whom" is no longer a word. That begs the question, "who cares"?
Wouldn't that be a different plan?
For one thing, for existing insureds with an out-of-pocket limit higher than permissible under the Affordable Care Act, the insurance company would have to cancel the remainder of the old policy and enroll the insured in a new policy with the lower limit as of the effective date of the Affordable Care Act. Recording this cancellation and enrollment would take some coding. For another, what a policy defines as an out-of-pocket cost and what the Affordable Care Act defines as an out-of-pocket cost may differ. An insurer may have to count costs that are deemed out-of-pocket under the Affordable Care Act separately from costs that are deemed out-of-pocket under the current policy, and it may be complaining that it lacks infrastructure to separately count these costs.
just do away with insurance companies and switch to single payer. We all need health care to live and stuff. What we don't need is a middle man that adds no value between us and our doctors.
Face it, health 'insurance' made since when the only thing a doctor could do was a) amputate and b) give out aspirin. It didn't matter that they only did a few big things that were mostly comfort before you died. Now we want to _use_ insurance. Insurance can't be profitable if we're all going to use it. The entire _point_ of insurance is that most of us aren't going to use it.
It's like hurricane insurance in Florida. Good luck buying it.
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would not be in the pocket of big money, the story would go in that manner:
What? Not ready by 01/01/2014 - it's going to cost you a million a day per case penalty and all the systems would be able to add up the numbers at deadline just fine.
This is laughable
An yes, the whole Obamascare show is political: http://www.dailykos.com/story/2013/08/11/1230529/-The-real-reason-for-the-GOP-s-all-out-war-on-Obamacare?detail=email
This is another example of how private health care doesn't work! Coming from Canada and having a few rare / serious medical conditions I just can't understand how anyone can support private healthcare.
I'd heard of "insurance" called "risk pooling" many times. That's the purpose of insurance. If we banned for-profit insurance, we'd have the "value" of insurance being exactly equal to its cost, with the benefit being risk pooling. Instead, all insurance is a poor financial decision, because you will statistically make more by not having it. But people buy it anyway because we are more risk averse than we are gain oriented.
Learn to love Alaska
What do you mean switch? We already have Medicare/Medicaid, and 1/3 of the uninsured go into those programs under Obamacare.
W..w..W - Willy Waterloo washes Warren Wiggins who is washing Waldo Woo.
they don't get to decide. Doctors do. It's single PAYER, not single INSURER. It doesn't work the way you're thinking in Europe, Canada, Germany or any of the other single payer systems where people are entitled (whoops used a bad word) to health care. The only purpose of the gov't is to pay doctors. And they can be well paid and still provide great service.
:).
But far be it from me to let a little thing like facts and the failures of the US healthcare system get in thy way of irrational fear mongering perpetuated by a multi-billion dollar insurance industry. Viva la death panels (well, the private ones anyway)
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Obamacare is really an attempt to create the sort of socialism that Americans can stomach. I got a good buddy with some serious health problems who relies on gov't health care (got several actually, because if you have a health problem it isn't long until you die or need help from the gov't unless you're an Heir/heiress).
Anyway, I started asking him what he was gonna do. How would he use private insurance. Wouldn't they insurer just keep raising his rates. He said that would be wrong, and so somebody should do something 'bout that. I asked who, and how and he said there should be a law that the insurance companies could only charge so much.
Basically he, like most Americans, deep down want single payer health care. But we're been taught from cradle to grave that socialism is bad. We're indoctrinated. It's called cognitive dissonance. He knows he needs socialism to live. He knows he needs help, and he knows it's his right (as a human) to live. Not just to have some blind dumb chance at good luck, but to actually have a life. But he's been taught, over and over, lied to and lied to. So he breaks down.
Obama recognized that there's lots of people like that. So he's giving them what they need (socialized health care) but doing it in the only way he can. He's letting the devil have it's due, and he's going to give billions and billions to parasitic insurance companies who's only purpose is to make us feel better about getting something that's a basic human right.
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lots of states will not opt those people in. Lots more will use lies and subterfuge to keep people off the roles. Arizona does everything it can to disqualify people. I've got friends with kids on the local medicaid program that have to report birthday money from granddad as 'income'...
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Actual payouts due to litigation is around 0.5% of medical spending. The money wasted by Doctors on malpractice insurance is far more, but you'd have to ask them why they agree to pay so much more than the expected cost of settling. I suppose it's a risk management issue - you're extremely unlikely to have a $10M settlement, but if you did you'd be happy to have paid $100K/year for insurance, even though if you averaged the settlements it'd be $5K/year/doctor. That kind of thinking is probably how the insurance companies are making so much money. :-)
Enable 3D printed prosthetics!
As a Canadian I have yet to see the very interference of the government into my health. I have never had any government official stop me getting an x-ray, stomp on my doctor when he ordered an ECG, or any of the other numerous tests and prescriptions he has ordered for me.
It's true that there are flaws, but when my wife was diagnoses with a life threatening cancer, no time wastes in diagnostics and in the two surgeries that followed. Better still, I was unemployed by the second surgery and we didn't have to bankrupt ourselves to save her life.
The world's burning. Moped Jesus spotted on I50. Details at 11.
Yeah, ever so much better to let a vastly overpaid CEO make that decision.
On the contrary, health insurance only "made sense" because during World War 2 businesses were prohibited from increasing wages to attract workers (because it would increase costs of material for the war effort), so they started offering employer-sponsored health insurance instead. Once the war ended, the idea stopped making sense again (but stuck around anyway).
"[Regarding the 'cloud,'] ownership was what made America different than Russia." -- Woz
No it's because the results of an unlikely occurrence are still far more catastrophic then the gain any single individual can obtain by not holding insurance.
The main thing for-profit insurance does is increase costs for consumers. It was pretty quickly recognized early on that the best possible insurance scheme for a country is single-payer, where everyone is part of the same risk pool since that's the greatest possible dilution of risk (it also means the government is strongly incentivised to keep its citizens healthy - companies dumping toxic waste into the local environment is no longer "not my problem").
Obamacare is a compromise forced by unions and large corporations that want to maintain their tax deductible "cushy" medical plans whilst the rest of the populous get forced into a command-economy style health care industry.
If Obamacare was actually single payer, or socialist, the cushy medical plans couldn't really exist (because the infrastructure that would have supported them meaning the insurance companies and the pay-for-service medical providers would have evaporated) and there would have been no support for it. Regardless if the that is what Obama wanted, his support base wanted to be able to keep their plans, so this is what came out of the backroom deal.
If you want some evidence of this, I suggest you start with the sad fact that congress needed to hastily pass a law to allow their staffers to get a federal subsidy to help pay for getting their insurance through Obamacare since they feared "brain-drain" of people fleeing public service to get better health coverage from the private sector. No, the people in charge of Obamacare don't want the same coverage for everyone, they just want to change the way healthcare is funded for the masses, not the elite.
Tiered coverage often doesn't work with single payer very well, because of economies of scale limit the availability of competition for supplemental insurance resulting in a very have and have-not price points. As an example of this, you can start by looking into the fact that in the US medicare supplemental insurance needs to be subsidized by the government to keep providers in the market. If that seems like an inherently unfair use of government resources to give health benefits to some people over other people, well, you are probably looking at a preview of Obamacare in a few years if they want to keep private insurers in the market as costs rise, but premiums are capped due to political pressure.
On the other hand, if you are a cynic, you probably think that this design was an intentional long-term policy to drive out all insurers so that the system has to convert to single payer. If you want to see some evidence of this, look at what Obamacare is doing to Medicare Advantage programs (alternate Medicare-like insurance provided by private insurers).
So when the insurance company can cancel their cover over a technicality... and you have cancer. What provider do you switch to? Yea, free market at work, you showed that insurance company who's boss. Your talking your illness elsewhere.
If information wants to be free, why does my internet connection cost so much?
back in 1995 I was working for a larGe TElco when my director called me into her office and instructed me to go down to Hartsfield (ATL airport) & pay the walk-up fare to get on the next flight to Raleigh b/c they couldn't process commissions & the SE sales reps were revolting ("you ain't kiddin' - they stink on ice" - sorry, couldn't resist). I immediately knew what problem was (well, 99+%) but felt conflicted so called (then) girlfriend (now wife) and said: "${DIRECTOR} just told me to get on next flight to Raleigh to fix commission processing but I'm 90% sure someone just didn't check ASCII->EBCIDIC when they uploaded the file" (which was prepared in 1-2-3) "I could probably walk them through it over phone in 5 min but it's effectively a free vacation day & I can probably get upgraded" (since I was medallion at time). she told me I should do the right thing & unfortunately I was born with the ethics gene (I probably be worth a lot more w/o it) & just called the desktop support guy in Raleigh who confirmed/fixed in 30 sec.
I just always thought that was funny - they were dead seriously telling me to pay probably $1K & waste a whole day to check an "x" in a dialog (& sadly I was too honest to take them up on it).
Hey, quit injecting your facts and experience into their wild speculation.
When there is only one payer, they control absolutely what things they will choose to pay for.
And you honestly don't think this happens today? Seriously?
Make no mistake: There are death panels in existence right now, this very moment. They work for the private insurance companies, doing their damned best to figure out how to kick people off of insurance rolls and rescind coverage for whatever reason will legally scrape by. Or even illegally, if they think that it would be cheaper to fight the battle until you die than to pay out your claim. The big difference is that today, you frequently don't find out what's not covered until after you're sick and need the coverage.
You don't trust government, I get it, I really do. And to some extent, neither do I. But you know what I trust even less than government? For-profit companies with a perverse incentive to deny you coverage you're paying for using whatever underhanded tactic they can and an historical willingness to do so, especially when the people being denied coverage don't have time or the money for a protracted legal battle and are at a physical or mental disadvantage that directly impacts their ability to fight such battles.
So yeah, I'd take a single-payer system over the crappy system we have today any time. Ultimately, that is the solution to our health care system, not private insurance, not employer-paid insurance, not even Obamacare, although it's a hell of a lot better than what we had. Maybe one of these days if you have the gut-wrenching experience of watching your mother fighting her insurance company for payment of cancer treatments while suffering from the "downtime" effects of chemotherapy, you'll prefer the general incompetence of government over the outright malice of for-profit insurance companies. Personally, I'm nice enough to rather you use common sense to arrive at the conclusion that having for-profit insurance companies responsible for funding your health care is and always has been a dumb idea.