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Consumer Driven Health Plans Save 21%
American Shareholders ^ | Ryan Ellis

Posted on 06/22/2009 9:20:50 AM PDT by nateriver

The American Academy of Actuaries published a study on Consumer Driven Health Plans that not only showed savings but also care was received in equal or greater degrees to traditional plans.


TOPICS: Business/Economy; Health/Medicine
KEYWORDS: actuaries; cdh; hsa; insurance

1 posted on 06/22/2009 9:20:51 AM PDT by nateriver
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To: nateriver
I am a health insurance agent.
I have a $5,000 deductible plan.
It costs, roughly, $100.00 per month.
I am 50 years old, a male, and a non smoker.

This is what almost EVERYONE should do.

It is not the purpose of insurance to cover EVERYTHING, anymore than home owners insurance should buy your light bulbs or paint your house!

2 posted on 06/22/2009 9:22:58 AM PDT by Kansas58
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To: Kansas58

Is that $5,000 inpatient? If you have $5,000 on both in and out, you must pay for everything plus $100 a month.


3 posted on 06/22/2009 9:26:45 AM PDT by b4its2late (I love defenseless animals, especially in a good gravy.)
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To: nateriver
I'm pleased to see the numbers confirm what I have been saying for years. Health insurance should be for catastrophic coverage. Only when the consumer controls the purse strings can health care costs be negotiated properly.

Imagine how much auto insurance would cost if it covered every oil change, tire rotation, and battery replacement.

4 posted on 06/22/2009 9:30:23 AM PDT by NautiNurse (Obama: A day without TOTUS is like a day without sunshine)
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To: b4its2late
Most consumer driven plans have a deductable that must apply to hospital, doctors office, and drugs combined. Once met, many will pick up 100% of cost (in your PPO network). Deductables range from as low as 1800 to as high as 5000.

In California, I find that the $3500 is my most popular plan.

5 posted on 06/22/2009 9:33:35 AM PDT by Nachum (The complete Obama list at www.nachumlist.com)
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To: Kansas58
I agree 100% with your approach.

Private Health insurance is the way to go, with some reforms of the industry.

I suspect many Americans, are to cheap to pay their own premiums, and instead rather spend their money on booze, tobacco, and junk foods, then go to the public hospital and expect the rest of us to pay for their bad choices.

6 posted on 06/22/2009 9:37:47 AM PDT by gitmogrunt (The stupidity of the American Liberal never ceases to amaze me.)
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To: gitmogrunt

But, here is the ERROR in the lefts push for socialized medicine:

Socialized Medicine can NOT “reduce costs” because access to more health care services will increase demand and increase cost to the rest of us!

The tobacco user with COPD SHOULD pay more than the person who does not use Tobacco. However, Medicare Part D and Medicare Part C and Medicare Part B do NOT charge more for bad behavior!

Another point is that the irresponsible, who can afford health insurance NOW, but refuse to pay for it, should probably be allowed that option. Remember, I am a health insurance agent. However, I realize that government mandates usually make things worse, and the quality for everyone will decline, if a “one size fits all” government program is developed.

Perhaps the most important point that is missed by the left?

What difference is there, really, between some crack head or hooker or gang banger without insurance, going to the hospital for care, which drives up medical costs for all of us through cost shifting -—

Or, charging higher taxes to all of us, up front, so that the hooker or gang banger or crack head gets “free” medical insurance?

Either way, the responsible are left to pay the bills for the irresponsible. What have we accomplished?

And, if you give the crack head, the hooker, or the gang banger a “free” health insurance card, don’t you think those folks will use the system MORE than they use it now?

(Especially through fraudulent attempts to obtain narcotic drugs?)

Also, health insurance coverage is an INCENTIVE to keep people out of the criminal class, and to get people into REAL jobs with health insurance benefits.

Do we really want to destroy another incentive, out there?


7 posted on 06/22/2009 9:51:32 AM PDT by Kansas58
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To: nateriver
Only about 5 percent of the population buys their own health insurance. I am convinced that if companies who didn't provide their own health insurance (self-funded) for their employees were not allowed to otherwise buy health insurance for them, but instead were allowed to give them tax-free money to buy their own insurance, that insurance would be much better, cheaper, and more people would be able to afford it.

I don't think companies who actually provide health insurance directly to their employees should be stopped though -- at least not yet. If people were all upset about their coverage, but that doesn't seem to be the case.

I know that if I had my choice, and there was an insurance company out there to offer it, I would get insurance based on my lifestyle.

Not to stray too much, but the biggest problem with insurance plans I see is that, if you really make them "fair" young people won't pay much at all, and old people will pay huge amounts since at some point they are pretty much guaranteed of having major medical expenses.

Most employee plans, either avoid this, or if they do anything, it's much less than the real costs (my employer charges us for insurance based on our salary, which loosely corresponds to years of service but not by much).

8 posted on 06/22/2009 10:25:03 AM PDT by CharlesWayneCT
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To: nateriver
I like the idea that doctor did about charging a flat rate for services (it was, what, $79/mo?). It makes more sense for older people and families with children (always taking the kids in for check-ups, school vaccinations, bumps and bruises that look/are serious, etc.) than paying X amount per month, but with a high deductible.
Young, single people, or those without children would prefer the low premium/high deductible type of insurance, as they rarely use doctors.

We have a high deductible and two school-age children. We've yet to meet the deductible and actually haven't used the insurance pay for anything. To me, that's just catastrophic insurance. Since catastrophies rarely happen, you'd think the insurance premium would be fairly low, it's not!

I also think doctors should advertise prices. You sure can't negotiate with them, except to make monthly payments on some service provided that you can't afford all at once.
If there was a way to get people to a doctor at the first sign of a problem, taking care of it early costs less all around for everyone. But that would need to cheaper than it is now. People with a high deductibles tend to put things off because of the high cost, whereas those with a, say, $25 co-pay, will visit their doctor sooner and catch things before they get too costly. That's how to lower costs.

9 posted on 06/22/2009 10:25:50 AM PDT by jeffc (They're coming to take me away! Ha-ha, hey-hey, ho-ho!)
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To: NautiNurse

Imagine how much an oil change would cost if it was covered by insurance, so that people who shopped for one didn’t care what it cost.


10 posted on 06/22/2009 10:26:07 AM PDT by CharlesWayneCT
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To: Kansas58

If I had a $5000 deductible on my health insurance I might as well not have health insurance. At almost 40 I’ve never come close to spending that much (combined out of pocket and insurance) on my healthl.


11 posted on 06/22/2009 10:30:25 AM PDT by razorboy
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To: razorboy

Well, with that logic, don’t buy life insurance either, since, so far, you have not died, right?

Do you have a clue what it costs for open heart surgery, cancer surgery, or other major illnesses?

Do you know what it costs to get an organ transplant, or to go on kidney dialysis?

And, if you think medical bills of $5,000 are a crises which requires that we scrap our current system, that is ridiculous.

The purpose of health insurance is NOT to gain access to health care.

The purpose of health insurance is to keep the patient out of bankruptcy court.

If you do not have any money or assets?

Bankruptcy court is a perfectly honorable option.


12 posted on 06/22/2009 10:34:10 AM PDT by Kansas58
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To: CharlesWayneCT
Not to stray too much, but the biggest problem with insurance plans I see is that, if you really make them "fair" young people won't pay much at all, and old people will pay huge amounts since at some point they are pretty much guaranteed of having major medical expenses.

Maybe if there was a way to pay your insurance premium so that, if you don't use any of it (or only a small portion of what you pay in) in any one year, the rest, or a portion of it, could be "banked" for your "later" years to help offset the increased frequency and costs that invariably happen as you age?
I remember being in my early 20's and never going to the doctor, but paying a healthy premium (and so did my employer - we shared the costs). Some people need to go to the doctor every year, or multiple times per year (diabetes, hypertension, thyroid problems, things like that) no matter what their age, but do not engage in "risky" activities that could lead to high medical bills, so that needs to be taken into account - just because someone needs to see a doctor twice or three times a year does not mean they lead a "risky" lifestyle.

But which "type" of insurance actually is more low-cost? A high deductible, where the insurance hardly ever pays anything out, but when it does, it's a large amount? Or a co-pay system, where you see a doctor at the first sign of a problem because it's such a low cost that you can treat something early, and therefor, less costly (in the long run)?
Seems to me that it would one type for young non-family types and another for those with children.

13 posted on 06/22/2009 10:40:45 AM PDT by jeffc (They're coming to take me away! Ha-ha, hey-hey, ho-ho!)
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To: Kansas58

Wow way to miss the point. Here’s all I’m saying, if I went with his plan I’d be spending $1200 a year to get NO benefit. Even the semi-medical catastrophes I’ve had haven’t come anywhere near that $5000 deductible.

I never said anything about scraping the current system, try to react only to what’s written not your own assumptions.

I think there’s room for different kinds of insurance, in health care and other types. If you only want catastrophic coverage great, I personally like basic access coverage for myself. And health care is by no means the only place where we have that style of coverage, you can get very similar home owners and renters insurance, that will pay for even rather minor repairs and replacements.


14 posted on 06/22/2009 10:42:09 AM PDT by razorboy
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To: razorboy
Here is the correct way to do the math:

I am spending, roughly, $100.00 a month for a $5,000.00 deductible plan.

If I were, say, to reduce my deductible to a $500.00 plan, my premiums would be nearly $400.00 a month.

That is $4,800 a year.

Save the difference in premium:

500 - 100 = 400.

Divide the savings into the higher deductible (to be fair you should divide the savings into the DIFFERENCE in the deductible, but I will use the full $5000.00 here)

$5000/400 = 12.5 months.

I a little over a year, you can SAVE the difference in premiums, and never worry about your deductible again!

More to the point, you can BANK that money, use it in retirement, leave it to your kids, or do whatever you want with it. It is YOUR money.

If you paid it to the insurance company, it would be gone.

15 posted on 06/22/2009 10:48:28 AM PDT by Kansas58
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To: razorboy

Well, in case you missed it, I support your right to buy “kitchen sink” insurance that covers everything.

I think it is a waste of money, but that is YOUR right.

I also think it is my right to buy “cat” coverage, and pay the little stuff out of my own pocket.


16 posted on 06/22/2009 10:50:09 AM PDT by Kansas58
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To: Nachum

Yes. It’s a good to prevent unnecessary use. HSA’s are a good idea too for those years when you might have to see the doc, or have a necessary procedure. Allot of this could be solved with better planning, not a government takeover, but we see that many Americans don’t care what the cost. Medicaid patients seem to frequent doctors more than anyone else since they pay nothing.


17 posted on 06/22/2009 11:08:35 AM PDT by b4its2late (I love defenseless animals, especially in a good gravy.)
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To: Kansas58

Doesn’t matter how you slice up the math, that style of coverage for me is useless, it’s money tossed down the toilet. I’d be spending $100 a month on insurance that I’d never use.

A lot of these kinds of things you need to figure out who you are. I’m an almost 40 year old guy in excellent health, I have one standing prescription and it’s an optional use allergy medicine, all my various medical numbers (cholesterol, BP, etc.) are good. I’m simply not a guy that needs to spend a lot of money on health care, so I insure accordingly, I pay the least I can for my coverage and it gives me the least coverage but without some big fat deductible.

Now if my health was worse, if I was actually in some serious risk categories, and possibly as I get older, that might all change. It’s possible that when I get to 50 I could look at your setup and say “yes that’s the coverage plan for me”, but currently it’s not. If I had your plan right now I’d give the insurance company $1200 a year, and give my various doctors about the same maybe less, I’d never get any benefit from the insurance coverage.


18 posted on 06/22/2009 11:08:53 AM PDT by razorboy
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To: razorboy
Well, insurance is NOT an investment.

If you get your money's worth, out of an insurance company, it means that something very bad happened to you!

You have every right to “work without a net” -—

However, I have been doing this for 25 years.

I have talked to lots of folks who want no coverage at all, but then got sick, got diagnosed with diabetes or cancer or some obscure disease, had a heart attack or stroke -—

And THEN cursed the insurance industry for “pre-existing conditions” rules.

You have every right, in a free society, to judge the risks for yourself and act accordingly.

However, it is YOUR risk.

Accept it like a man when something bad happens to you.

That is all I ask.

19 posted on 06/22/2009 11:12:51 AM PDT by Kansas58
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To: b4its2late

I would think at a minimum health insurance should cover one yearly physical, immunizations, and catastrophic services / insanely expensive medication..


20 posted on 06/22/2009 11:18:50 AM PDT by N3WBI3 (Ah, arrogance and stupidity all in the same package. How efficient of you. -- Londo Mollari)
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To: Kansas58
I have talked to lots of folks who want no coverage at all, but then got sick, got diagnosed with diabetes or cancer or some obscure disease, had a heart attack or stroke -— And THEN cursed the insurance industry for “pre-existing conditions” rules.

Young people will be suprised how fast health starts to fail as they age. One day you wake up and find you need glasses (and I mean "need"!), having never worn or needed glasses for anything before in their lives. Or they find their thyroid has deteriorate, or they have high cholestorol (due to hereditary circumstances).

Yes, it happens that quick.

21 posted on 06/22/2009 11:18:59 AM PDT by jeffc (They're coming to take me away! Ha-ha, hey-hey, ho-ho!)
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To: Kansas58

Depends on what kind of insurance you’re getting. Certainly annuity life insurance is an investment.

At my health level I already know the insurance company will come out ahead. That’s a given and I’m grateful for it. The question is how much ahead and am I willing to tolerate it. $1200 bucks a year ahead AND I still get stuck paying every cent of my medical is, in my book, 100% unacceptable. I don’t pay that much for my term life insurance which is more likely to pay out than your medical policy would be for me.

The pre-existing condition rule is lame, I can see it for things like cancer, but way too often insurance companies use it to get out of chronic condition and thing they just don’t feel like paying for.

Of course meanwhile people CAN and do get medical access coverage, and frankly there’s nothing wrong with that. All I’m calling into question is your statement that “EVERYONE should do” the policy you’re on. For me in my health situation your policy charges too much to do too little. Maybe many people should be on your policy, maybe even most, but not even close to everyone.


22 posted on 06/22/2009 12:49:46 PM PDT by razorboy
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To: jeffc

Of course the insurance policy he outlined in post 2 probably wouldn’t pay out for any of those things you mention here.


23 posted on 06/22/2009 12:52:07 PM PDT by razorboy
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To: Kansas58
It is not the purpose of insurance to cover EVERYTHING, anymore than home owners insurance should buy your light bulbs or paint your house!

Hmm . . that definitely is true for most insurance (life, car, home), but health insurance might (I say "might") just be a different animal, especially if someone wants to craft a policy that will help keep long-term costs down (I'm thinking preventive care here).
This being a (supposedly) free country, there should be nothing stopping someone from offering such a policy.

Being able to catch a potentially serious illness in its early stages drastically reduces the overall, or eventual, costs. That should be the goal of healthcare now - get costs under control without sacrificing quality.

24 posted on 06/22/2009 1:27:42 PM PDT by jeffc (They're coming to take me away! Ha-ha, hey-hey, ho-ho!)
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To: jeffc
I do not disagree that we should leave this up to the marketplace, and allow individuals choice in their level of coverage.

However, so called “wellness” issues have always been oversold.

Preventive care really does NOT hold down costs. It might even increase costs, in many areas.

Yes, an individual who finds out about a medical issue, like diabetes, EARLY might well take some corrective action and reduce future costs.

However, if there is NO or LITTLE charge, to the public, for doctor's visits, the hypochondriacs among us will more than offset that savings, by burdening the system with too many office visits.

25 posted on 06/22/2009 1:37:44 PM PDT by Kansas58
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To: razorboy
Please, no offense intended, but your argument is easy to refute.

There is a “mortality charge” in any annuity product, which offsets the actuarial risk for life expectancy in that annuity.

Also, in Variable Annuities, there is a charge, a PREMIUM, against the “separate accounts” in the investment portion of the product, to offset market risk.

Given the SAME positive market performance, the same underlying investments, a “naked” mutual fund will produce a higher return than an identical investment through an variable annuity.

I love variable annuities. I sell variable annuities and health insurance.

However, it is wrong to look at the ENTIRE annuity as insurance, as far as the investment returns are concerned.

Likewise with variable life products, which I don't like as much.

26 posted on 06/22/2009 1:42:18 PM PDT by Kansas58
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To: N3WBI3
Medicare does not even cover “routine physical examinations” after the first year of coverage.

Nor does Medicare allow the cost of a routine physical, after the first year, count towards the $135.00 Part B deductible.

27 posted on 06/22/2009 1:44:44 PM PDT by Kansas58
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To: Kansas58
However, if there is NO or LITTLE charge, to the public, for doctor's visits, the hypochondriacs among us will more than offset that savings, by burdening the system with too many office visits.

Sadly, too true. There are people who abuse, and will abuse, the "system". But still, families with children really need insurance that is different than what seniors need, and that should be different from what healthy young, single (or childless couples) people need.
I really don't think a one-size-fits-all type of insurance benefits everyone (not that I say you are advocating such a thing).

So then the question is: how do you rein in runaway healthcare costs (starting with tort reform, I suppose . . . )?

28 posted on 06/22/2009 1:48:43 PM PDT by jeffc (They're coming to take me away! Ha-ha, hey-hey, ho-ho!)
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To: Kansas58

Wow that was a lot of “refute” for one little throw away sentence that was largely besides the point.


29 posted on 06/22/2009 1:55:15 PM PDT by razorboy
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