Primary elections were held in 11 states this week as lawmakers returned to Washington, D.C., to face a growing list of unfinished legislative business including a jobs bill and environmental issues stemming from the Gulf crisis. Meanwhile, President Barack Obama launched a public relations campaign to combat skepticism around his new health care reform legislation and to promote the early implementation of certain provisions of the law.

Congressional lawmakers address concerns about the new health care reform legislation, particularly among senior citizens , who make up a disproportionate share of voters in midterm elections. Democrats and the administration are eager to publicize certain provisions of the bill, like retaining young adults on their parents’ plans until age 26, as a way to gain support and to turn voters away from Republicans who called for its repeal.

On Tuesday, President Obama held a nationally televised town hall meeting at a senior center in Maryland to highlight the distribution of $250 rebate checks for senior citizens who hit the so-called “doughnut hole ” in Medicare’s prescription drug coverage. The first round of checks was mailed yesterday and serves as the law’s first monetary benefit.

State Battle Against Health Care Reform Law Continues:

On Monday, Virginia Attorney General Ken Cuccinelli disputed the administration’s claim that the state lacks standing to challenge the new federal health care reform law. The lawsuit filed by Cuccinelli in the Eastern District Court cites a Virginia law that exempts state residents from being required to have health care coverage. Sebelius argued that states cannot simply pass a statute that would nullify a federal law. A hearing to determine next steps is set for July 1.

Public Opinion

Americans Want Repeal of Health Care Reform: A recently released Rasmussen report suggests that Americans are strongly in favor of repealing President Obama’s health care reform law. Fifty-eight percent of those polled favor repeal, while 62 percent believe the new legislation will increase the budget deficit. In addition, 57 percent predict health care costs will increase, while 51 percent feel the quality of care will decrease as a result of the new health care reform law.

Looking Ahead

Democrat lawmakers are expecting to pass the jobs bill next week but will need Republican support in order to get the 60 votes needed for passage. One provision of the bill, a 21 percent cut in Medicare payments to doctors, is being delayed as the bill moves through Congress and would ultimately be blocked if the legislation passes.

As the health care reform debate continues to take shape this year, we encourage you and others to engage members of Congress by visiting the Health Action Network.

As lawmakers complete a week long recess in their home states, Obama administration officials move forward on implementing certain provisions of the health care reform legislation. Recent national polling shows a majority of Americans strongly favor repeal of the law.

As health care reform legislation continues to take shape this year, we encourage you and others to engage members of Congress by visiting the Health Action Network.

Young Adults Might Not Be Covered Ahead of Schedule:WellPoint’s affiliated health plans and other insurers began extending medical coverage for qualifying graduating students on June 1, well in advance of the September 23deadline. However, many employers plan to wait to provide the extended coverage until they are legally required to do so, with an effective date of January 2011 for most employers.

Senate Fails to Extend Bill for Doctors: Before leaving for the Memorial Day recess, House Democratic leaders scaled back health care language from the jobs bill before passing the bill. In the package, doctors who treat Medicare patients would see a 2.2% payment increase for the remainder of this year and a 1% payment increase in 2011. Extensions of COBRA subsidies and additional Medicaid funding for states were removed from the bill. Lawmakers in the Senate will vote on the bill when they return from recess next week.

Florida Judge Denies Government’s Motion: Health and Human Services Secretary Kathleen Sebelius asked a federal judge in Florida for a one-month extension to respond to the joint lawsuit filed by 20 states’ attorneys general who challenged the constitutionality of the new health care reform law. U.S. District Judge Roger Vinson denied the administration’s request for an extension and instructed HHS officials to respond by the June 16 deadline. 

Public Opinion

Americans Want Repeal of Health Care Reform: A recently released Rasmussen report suggests that Americans are strongly in favor of repealing President Barack Obama’s health care reform law. Sixty percent of those polled favor repeal, while 62% believe the new legislation will increase the budget deficit. 

Majority of Americans Unhappy with Reform: According to a new Quinnipiac University poll, 51% of Americans are unhappy with the new health care reform legislation and 70% are “dissatisfied” or “very dissatisfied” with the way things are going for the nation. 

Looking Ahead

Lawmakers return to Washington on Monday ahead of a contentious primary runoff in Arkansas between Democrats Sen. Blanche Lincoln and Lt. Gov. Bill Halter, with health care reform at the center of the debate. The winner of Tuesday’s Democratic nomination will face Republican Rep. John Boozman in the November elections. 

Fact: Just the opposite is true. Because insurance is a means of financing health care, premiums have to track the underlying cost of health care services. Those underlying costs have been rising and insurance premiums have simply kept pace.

Health care costs drive insurance premiums, not the other way around. Over the last decade, health care costs have risen about 7.7 percent a year on average, and insurance premiums have also risen at 7.7 percent.1 The overall rise in health care costs is a result of higher rates of chronic conditions such as obesity, diabetes and heart disease, more expensive technologies and procedures becoming available, and “cost shifting by the government” – that is, doctors and hospitals charge privately insured patients more to offset the losses that come from Medicare/Medicaid underpayments that do not cover costs. In fact, about 11 percent of the average family commercial Preferred Provider Organization (PPO) premium stems from government cost shifting.2 Other drivers of cost include waste in the system and how providers are reimbursed for delivering health care services; they are paid by procedure, which many believe leads to unnecessary care.

When Aetna sets its premiums for the year, it looks at how such costs are expected to grow and prices accordingly. The primary factors responsible for price increases can and should be addressed through health care reform that emphasizes, for example, the importance of wellness and preventive medicine, administrative simplification, investment in health information technology (HIT), emphasis on evidence-based medicine and health delivery payment reform.

Aetna wants to slow rising costs, “bending the cost curve” of medical treatment. To draw more national attention to this issue, Aetna and the Aetna Foundation, along with the Commonwealth Fund, sponsored the September/October 2009 edition of Health Affairs, the leading journal of health policy, focused exclusively on cost drivers in health care.

More information is available about the special edition of Health Affairs and the real drivers of rising health care costs (PDF).

Myth: Health care companies reap huge profits and benefit from the status quo.

Fact: The average profit margin of health care companies stands at only 5 percent, lower than many other industries and other players in the health system. It is better for everyone if we get and keep all Americans covered.

While there’s plenty of talk about “insurance company profits,” the truth is that health insurance companies’ five-year average profit margin is about 5.3 percent. That means for every dollar of revenue Aetna takes in, we make about 5 cents in profit. This is significantly less than drug companies (18.4 percent), cigarette manufacturers (13.4 percent) or computer software companies (22.5 percent).3 In fact, in 2008 Aetna paid about as much in taxes as it made in profit.

It also means that language casting health insurance companies as the villains in rising health care costs is inaccurate. In fact, Aetna has taken the lead in trying to bring down costs in health care through various initiatives, such as by investing $1.8 billion in health information technology since 2005 much of it to help patients interact more effectively with their doctors and to help doctors have access to information that greatly improves patient care. Health insurance companies in general, and Aetna in particular, are investing constantly in helping to improve American health care.

Myth: Medicare is more cost-efficient than private insurance because its administrative costs are half as much as private plans.

Fact: Comparing Medicare’s claim costs and private plans’ administrative costs is an apples-to-oranges comparison. In areas of similarity (e.g., claims processing, actuarial and underwriting services), Medicare and private plans are much closer together on equivalent costs.

Private health insurance administrative costs have led some to claim Medicare is a much more effective system and that a similar government-run program would be the most cost-effective option for Americans under 65. A closer look at administrative costs for Medicare and private plans paints a very different picture.

First, it is important to recognize that Medicare and private plans serve different populations. Medicare patients are older and require more care than the general population, which means that the average claim in Medicare ($10,003 in 2007) is two-and-a-half times more than the average claim for the under-65 population ($3,946).4 Consequently, Medicare’s administrative costs represent a much smaller percentage of total Medicare costs than does administrative costs in the non-Medicare world. Also, traditional Medicare does not provide the full spectrum of services that private plans do. For instance, Medicare does not promote care coordination, wellness, or disease management. As a result, Medicare may face higher overall costs — due to unnecessary care or erroneous payments — for reasons beyond the age of Medicare’s population. This means that as a percentage of claims, Medicare administrative costs are relatively small and comparisons to non-Medicare are misleading. The result is the same whether you look at total spending or total premiums paid. Add to this the fact that Medicare’s numbers only include claims processing, and the comparison is truly apples to oranges.

The bottom line: When you look solely at those administrative functions traditional Medicare performs, private plans perform them at lower cost. A new study found that when comparing based on functions performed by Medicare and private plans, Medicare has higher administrative costs of $13.19 per member per month versus private plan costs of $12.51 per member per month.5

Learn more about the value private insurers bring to Medicare by reading a Medicare Advantage summary prepared by America’s Health Insurance Plans.

Myth: Paying more for health care guarantees better treatments and better outcomes.

Fact: People who spend more often do not get better results, and in many cases, higher costs lead to worse results.

People often assume that because a procedure or medication is more expensive, this signifies that such a treatment is newer, more advanced or better than some cheaper alternative. The truth is that what is effective and what is expensive are not always the same, and in many cases, can be quite the opposite. Studies have shown that states that spend the most per person on health care generally have the worst results. Texas and Louisiana have the most expensive health care in America. They are also two states with lower quality care than other states.

Research shows that when regional differences in spending and outcomes of care are examined, the higher-spending regions (compared to lower-spending regions) experience worse adherence to evidence-based care guidelines; higher mortality following acute myocardial infarction, hip fracture and colorectal cancer diagnosis; worse access to care and greater waiting times; worse inpatient experiences; and no difference in patient-reported satisfaction with ambulatory care.6

High-cost treatments need to take a back seat to high-value treatments; those procedures and medicines that provide the best medical results for the lowest cost. This doesn’t mean random cost-cutting of expensive procedures. It means intelligently examining what works and what doesn’t and directing our money there. In many cases, true cost-effectiveness studies on treatment aren’t done. When they are, the results are not always used by doctors. It is essential that health care reform put the emphasis on evidence-based medicine.

1 CMS, National Health Expenditures Data, 2009.
2 Milliman, “Hospital and Physician Cost Shift,” December 2008.
3 www.thestreet.com Ratio Comparison Chart for Industry, published March 2009.
4 Centers for Medicare and Medicaid Services, National Health Expenditures, historical series, 2008.
5 Sherlock Company, “Administrative Expenses of Health Plans,” 2009.
6 The Dartmouth Institute for Health Policy & Clinical Practice, “Health Care Spending, Quality and Outcomes: More Isn’t Always Better,” 2009.

Go to kp.org/reform to get detailed information about Kaiser Permanente’s principles and perspective on health care reform.

It was announced earlier this week that our parent company is taking steps to prevent a gap in coverage that could leave many young Americans uninsured.

Each year in June, many young people – because of their age, student status or other factors – become ineligible as dependents on their parents’ insurance policies. Health care reform legislation, signed into law last month, will extend dependent coverage to age 26 for plan years beginning September 23, 2010. While this is great news, it also means that many members would face a coverage gap during the months before this provision is fully implemented.

To help these members, we’re working, in collaboration with the U.S. Department of Health and Human Services and state regulators, to allow young men and women to remain on their parents’ group and individual health policies even before this health care reform provision takes effect. Beginning June 1, we will continue to provide health benefits to those dependents that would otherwise lose coverage because of their age, student status or other factors during the gap period between June 1, 2010, and the September 23, 2010, effective date. This extension of coverage will not be retroactive, however, for those who have dependents who aged out prior to June 1, 2010. Those individuals will be able to add their dependents back onto their policies with the new plan year beginning on or after September 23 in accordance with the new law.

Our ASO, and any fully or partially self-funded accounts over 100 lives, will have the option of not offering this extended coverage. We will work with these groups individually to ensure their needs and the needs of their employees continue to be met. We’re developing additional information that will help these groups opt out, if they choose to.

Some states already have provisions that allow for dependents up to the age of 26 to be included on their parents’ policy. However, in many states this new coverage will allow for many more dependents to remain on their parents’ policies, so we will provide additional details regarding how this decision coordinates with state mandates and dependent coverage in future communications.

As with every subsidiary of our parent company, it’s our priority to protect access to health benefits for our members. We believe this initiative will help do this, while giving our members the chance to get even more from health care reform. For details, please take a look at this Q&A and news release. You can also expect more information as it becomes available.

Selecting the best medical plan or health insurance is significant, not only to your physical health but also to your economic well-being. Walter Ray Holt Insurance Services provide a comprehensive assortment of health plan solutions to Fresno residents.

Types of California Health Insurance and healthcare plans we provide:

• Individual Health Plans
• Family Health Plans
• Group Health Plans for Small Business Owners (2-50 employees)

Contact us today to get detailed information pertaining to health coverage, dental coverage and life insurance options for your Small Business; Find out more about healthcare professionals, pharmacies and insurance agents in Fresno; and Apply Online for individual & family health plans.

Paying too much for health insurance in Fresno? Request a quote today if you are looking for ways to reduce the cost of your health plan and keep the benefits you use the most? If you have not reviewed your business health insurance needs lately, it’s time to review your health plan and make sure you have adequate coverage. We offer health insurance quotes to our Small Business clients. Get Group Health Quotes.

Shopping for the right Fresno health insurance plan can be confusing, which is why we are here to help. As you may know, plans change over the course of weeks, even days. Individuals & families use our Plan Finder to get instant health insurance quotes, compare plans from multiple carriers, and apply online for health insurance.

We offer a broad range of health plans, varying costs, levels of health coverage, and accessibility to health care. These are important considerations for helping you identify which plan is right for you. We offer the lowest regulated rates on PPO, HMO and Indemnity Policies. Most importantly, we make it easy to choose a plan and apply online. No hassles, no waiting.

• Self-employed or not covered under your employer’s plan?
• Not satisfied with your employer offered plans, or would like additional family coverage?
• Seeking additional protection from an unexpected accident or illness?
• Are not covered by any other health plans including Medicare?
• Are you no longer a dependent on your parent’s plan because of age or no longer in school?

These are a few reasons why you may consider purchasing individual health insurance.