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Al Rosenthal: Consistent data can't be ignored

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The letter “Question the data” (Steamboat Today, Sept. 3) made me question the letter’s intent. Was it to question the data of any given subject or to mistrust ColoradoCare by doubting its data?

Data in itself is usually facts or figures, gathered together for analysis or reference by business leaders, managers, policy makers, and average citizens for various reasons.

While I have no qualms with questioning data, I do mistrust the letter’s purpose with this statement, “if you consider the data provided by the expert proponents of the ACA [Affordable Care Act] and the reality of the program you should be able to realize that the data was worthless.”

The problem is the letter’s seemingly deliberate misunderstanding about this statement. The insurers are not exiting the ACA due to flawed data, but because of how many desperately sick Americans there were from being rationed out of health care by economic means for so long.

Aetna is a perfect example. In 2014, Aetna made nearly "$7 billion in profits” off of us. Yet, it is exiting the ACA because of what its CEO Mark Bertolini "described as a spike in individuals in need of high cost health care.” (healthinsurance.org/blog/2016/08/25/cry-me-a-river-aetna/). Simply put, Aetna does not want to pay for sick people.

The ACA is no ”centrally-planned healthcare system, nor is it an example of “socialized medicine experiments.” Its planning occurs in a decentralized zone of ornate corporate boardrooms; its “socialized medicine” is beholden to Wall Street.

True “socialized medicine,” as the rest of the democratic world knows, is about as socialistic as the Steamboat fire and police departments. The data for these systems, however, consistently reveals something remarkable about them that cannot be ignored and will make me vote yes on 69.

Al Rosenthal

Steamboat Springs

Comments

Ken Mauldin 6 months, 3 weeks ago

To compare public services like fire and police with the delivery of socialized healthcare is misguided for two important reasons:

First, police and fire services respond to emergencies. Every single person present in the United States can already receive emergency healthcare at any emergency room in the country.

Second, there is no incentive for citizens to consume police or fire services beyond the immediate need for assistance.

Economically, it's like comparing apples to automobiles to suggest that a healthcare market can be operated in the manner that the public services of police and fire departments are operated.

Because profit drives innovation in new medicines and new medical devices, profits are expressly good. Without a profit motive, we wouldn't have MRIs or many of the medical advancements that make modern medicine possible. It's a terrible idea to try to remove the profit motive from an industry as important as healthcare. The only improvements in costs and availability in healthcare can come from increasing competition and consumer choice, not more laws that force trade and limit competition.

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Lock McShane 6 months, 3 weeks ago

Profit is not the only motivator for human actions. Medical advances can be made without fortunes also being made.

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Scott Wedel 6 months, 3 weeks ago

So if Aetna really made $7B on ACA then why are they leaving that market? And why wouldn't other insurance companies gladly enter that market?

That is how someone "questions the data" being presented.

The answer is that Aetna made money on other parts of their business, not their ACA insurance. Thus, they are withdrawing from the money losing ACA insurance programs.

ACA seems to work for so-called narrow networks where there are fewer doctors that have better communication among themselves.

I find the illogic laughable that because current system is imperfect then anything would be better so it is okay to blow up the current system that is 20% of Colorado's economy because a government program would automatically be way better.

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Dan Hill 6 months, 3 weeks ago

"Aetna does not want to pay for sick people"

I'm sure they'd be more than happy to do so if their healthy customers would just agree to pay higher premiums to cover the additional costs. So if you want to blame anyone, blame healthy people (who are not signing up for ACA policies for the same reason).

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Lock McShane 6 months, 3 weeks ago

What would happen to healthcare if all the insurance companies dropped out of the healthcare market?

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Kristen Moll 6 months, 3 weeks ago

Something else would come to play. Although I do believe it would be like the stock market crash.

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Scott Wedel 6 months, 3 weeks ago

In an economics class, it is a common example to say that you don't often find $20 bills lying on the ground. What that means is that free money is going to be quickly grabbed by someone.

That companies do not walk away from $7B in profit. That the only reason that all companies would drop out of the healthcare market is if the market is so poisoned by government regulation that they cannot make money.

Just yesterday I was reading an article on how less methane overall is leaking from US wells than a few years ago. The big change was when BLM started looked for leaks and seeking their royalty payments for the gas that was leaking. Their leases called for the drillers to pay for the gas taken from the ground, not just that which they sold. So even before federal regulations on wells leaking methane could be imposed, the well owners paid to have their leaks detected and fixed because they were now being charged for what came out of the ground.

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Stan Zuber 6 months, 3 weeks ago

I agree!

Plus I don't want to pay 10% of my retirement savings.

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Lock McShane 6 months, 3 weeks ago

Harvey, it looks like you are against insurance in any form, since you don't want to cover anyone else's risk, and , by extension, you don't want anyone else covering your risk. Would you rather pay out-of-pocket for all your expenses normally covered by insurance? You can if you want to.

Insurance works by spreading the cost of risk among a large number of people. It works best when the risk of a claim for any individual is small, but the cost for any incident is large.

This is why the insurance paradigm doesn't work for health care, because health care is something that everyone needs. Even non-catastrophic care can bankrupt a person. To make sure that everyone gets health care, then we all have to pool our money together so everyone gets care. Something like ColoradoCare.

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Scott Wedel 6 months, 3 weeks ago

Though, insurance means that everyone else helps cover when you have an accident and cause damage.

The big trouble with health insurance is that it is less random and more predictable. Someone looking at your current health can reasonably accurately predict your future healthcare costs. That is a significant part of the problem of people finding it impossible to get health insurance because of prior or existing conditions. It isn't similar to auto insurance or house insurance where a person can decide to become more responsible and lower their insurance risk.

There are enough people with unlucky genetics that we cannot simply say "Oh well, die" and not give them healthcare which there is no way they could afford.

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Scott Wedel 6 months, 3 weeks ago

Harvey,

The negotiated price by health insurance companies is apparently closer to $50K.

Should we pay to treat your stroke due to hypertension resulting from Hillary winning in a landslide and the Democrats winning a Senate majority? (Not that I want you to have a stroke).

As for Hep C, I know someone that was on the verge of seeking a liver transplant as Hep C was resulting in reduced liver function, but instead was able to take the drug while it was being tested. Not everyone with Hep C gets it due to IV drug use. And it is the sort of medical issue that HMOs are good at controlling the costs by not only negotiating the price of the drug, but waiting to treat it until it is clear that person won't be reinfected.

If the reason for infection is in the past then the cured person could have 20-30 more years of productive work paying taxes, being good father and so on. Economic and social costs would suggest that the life of that adult with Hep C is worth about $1.5M.

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Michael Bird 6 months, 3 weeks ago

Al, As you stated, data is facts but CC has not provided us with facts. We don't know personnel costs for example. We don't even know what CC's CEO's salary will be. We do not have facts but only guesses. Insurance companies cannot like or dislike anything as they are not capable of making such decisions. Employees ( people ) make the payment decisions and the decisions are made on contractual legal obligations. If policy includes or excludes coverage for maternity, the policy form determines if payment will be made. Just like buying a car if you don't buy SIRUS, don't expect Ford to provide it. Facts are important for knowledge but they must be complete such as AETNA did not make its profit from health exchanges. And AETNA did not keep that profit. It went to its stockholders including teachers pensions, police/fire pensions , retirees, etc. - Americans who want to have a financial foundation and are willing to buy a stock that has a massively lower profit margin than unregulated industries. This is why State Farm (except for Medicare Supplemental), Prudential, Travelers, Allstate,Geico, Progressive, Hartford,etc. do NOT - repeat do NOT sell health insurance.

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Martha D Young 6 months, 3 weeks ago

With all due respect, Mike, I don't think the insurance industry is regulated.

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Carl Steidtmann 6 months, 3 weeks ago

Then I have to ask what these folks are doing?

https://www.colorado.gov/pacific/dora/division-insurance

Or is this just another example of government gone astray?

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Larry Desjardin 6 months, 3 weeks ago

Of course, when someone claims they are going to set a world record in health care cost savings (16%), you should question the data. That amount has never been achieved before, in any country, at any point of time. However, A69 claims to set this new record while simultaneously covering more people and eliminating deductions. But, proponents say, they have a study that confirms they can do it! Health care studies are notoriously bad, and one-sided: overly optimistic. I'm sure the eight ACA co-ops that have gone out of business also had studies.

The Vermont attempt at single payer also had a study. But the reality was that the numbers couldn't hold up as implementation grew near, and the claims of the opponents turned out to be true. Vermont Governor Peter Shumlin (D) ran for office on a platform of bringing single payer health care to Vermont. However, when the reality of the situation became clear, he pulled the plug on the whole mess, saying,"In my judgment, the potential economic disruption and risks would be too great to small businesses, working families, and the state’s economy.”

The same can be said of Amendment 69.

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Lock McShane 6 months, 3 weeks ago

Larry, your 16% reduction in cost is not a world record. Many countries spend 10% of GDP on health care vs 17% in the USA. That is a 40% reduction in cost and the have better health outcomes than we do.

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Larry Desjardin 6 months, 3 weeks ago

Hi Lock. My statement is both accurate and pertinent. No country has been able to institute reforms that change their own cost structure more than a few percent. Scroll down to the graph of spending growth vs. country in this Bloomberg article below.

https://www.bloomberg.com/view/articles/2014-04-30/single-payer-would-make-health-care-worse

There you see that the record is Germany that once cut costs by 3%, and only for one year. This barrier is true, even if they adopt the insurance policies of lower cost neighbors. Why is this? One reason is that this is not just an insurance regulation issue, as Amendment 69 proponents claim. Other industry structural issues determine the degree of possible savings. For example, a general practioner in Germany averages $52K of annual income, while a GP in the US averages $142K. You can reform the insurance system all you want, but you won’t get the German cost structure.

So, my statement stands: The record for cost savings by reforms is 3%, and only for one year. Amendment 69 is predicated in achieving 16% and staying there.

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Nancy Spillane 6 months, 3 weeks ago

Well written, Al. I wholeheartedly agree with: "True 'socialized medicine,' as the rest of the democratic world knows, is about as socialistic as the Steamboat fire and police departments. The data for these systems, however, consistently reveals something remarkable about them that cannot be ignored and will make me vote yes on 69." Applause, applause.

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John Weibel 6 months, 2 weeks ago

From the debates last night Hilary said our health care system is funded primarily by employers. The problem herein lies that many employers are figuring out how to make their business work with fewer employees.

How long can we keep adding taxes on human labor and let technology continue to supplant labor without paying its fair share?

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John Weibel 6 months, 2 weeks ago

Nancy great figure out a way to pay for your program in which those making large incomes pay the same, that does not harm small business disproportionately to pay for it and hopefully those activities which have helped create our health woes help to pay for our sick care.

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John Weibel 6 months, 2 weeks ago

Here is an example of how doctors were helping to control costs prior to the Aca. The insurance industry probably did not like it and saw a threat just like many industries placed barriers to protect their share of the pie.

http://www.businessinsider.com/private-doctors-stop-accepting-insurance-michael-ciampi-obamacare-2013-5

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Scott Wedel 6 months, 2 weeks ago

That is also why HMOs hire doctors on salary so that HMO members can visit a doctor without having administrative overhead on figuring out billing.

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John Weibel 6 months, 2 weeks ago

Yep, does not take making a whole new insurance system to make it work. Kaiser is doing it well and in reality doctors and insurers could figure out some way of collaborating to cut costs like a HMO.

it just takes thinking outside the box, and actually seeing that the insurers are not getting rich today on health care - without going with the nuclear option and blowing up the current system.

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Scott Wedel 6 months, 2 weeks ago

The Nobel prize for economics was given for work on contracts and incentives.

The great advantage of the free market system is that "thinking outside of the box" has good incentives without putting the entire economy at risk if that thought doesn't work out.

Health insurance has an ongoing competitive issue between extremely convenient see any doctor plans vs lower cost plans with a limited network of doctors. Narrow networks of doctors seem to be doing well under ACA while broad networks are doing poorly.

Part of the problem with ACA appears to be state rules defining regions. Low population areas of higher cost are not allowed to have insurance plans with local general practitioners, but handling most more involved cases in a more efficient Denver hospital. The scheme of having zones is basically subsidizing rural hospitals by making rural residents pay more by preventing rural residents from having lower cost options.

There is a balancing act of needing to have a viable local hospital at least able to handle emergencies.

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Michael Bird 6 months, 2 weeks ago

Martha Young, Please check with the Colorado Insurance Dept. and you will find that all insurance is highly regulated. Premiums and premium increases are regulated. This is one reason their profit margins are much lower than most industries and why State Farm,Allstate,Prudential, Progressive, Hartford, and the list extends to almost every insurance company - do not sell group nor individual health insurance. State farm sells only one form - supplemental Medicare.. The Dept of Insurance must approve rates, thus premiums, or they cannot be used.

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Michael Bird 6 months, 2 weeks ago

Notice how no one still has data -defined as facts. Ex - No personnel costs. But. of course, if one makes projections, one can have any outcome. And the 80% of healthcare (medical) costs are still significantly increasing and CC cannot reduce most of the increase.

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Lock McShane 6 months, 2 weeks ago

Michael, I would think that CC would have the power to negotiate prices, and could help bring costs down.

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John Weibel 6 months, 2 weeks ago

Lock, they just might negotiate all of our doctors to different areas. This as they may just say well we pay this for this procedure, not considering differences in costs from one region to another.

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Lock McShane 6 months, 2 weeks ago

CC could negotiate one price per procedure per provider, which would be vastly simpler than our current morass of prices.

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Michael Bird 6 months, 2 weeks ago

Lock, hope is not data nor is it fact. The Federal law, ACA, specifically prohibits bidding of pharma. Insurance companies do negotiate prices but that is exactly what some criticize them for doing. The main point that I have tried to make is that we have not been given facts. Since 80% of healthcare is NOT administrative and CC is saying they will reduce these costs ( but cannot prove it because no costs are provided such as personnel ccsts ) simple arithmetic shows it cannot occur. Medical ( the 80%) costs are rising significantly and these increases far exceed any supposed administrative savings that CC could provide. Do you really think that CC ( Colorado only ) has the same negotiating power as a national insurance company. Think of the law of large numbers. So whose costs would CC reduce ? MDs - don't think they'd be happy about that and the list goes on. To me,it is a lot like NIMBY. But without facts isn't this all just supposition ?

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Lock McShane 6 months, 2 weeks ago

The ACA only forbids Federal agencies from negotiating prices with pharma. Insurance companies negotiate prices for their benefit, not for the consumer's. Your constant statement that administration of healthcare is 20% only applies to the insurance companies; provider's administrative costs are usually more than 20% because of the complexity of dealing with the insurance companies and their multiple prices for the same procedure. There would be much saving from dealing with a single entity with one price per procedure vs multiple prices from multiple insurance companies.

Yesterday, I went to YVMC for a phlebotomy, and they could not tell me what the procedure would cost me. This is a lousy way to run a supposed free-market system.

And CC would have considerable negotiating power, and they would be negotiating for the benefit of the consumer, not for the benefit of a for-profit company.

Basically, the savings would come from reduced administrative costs throughout the whole system, not just the admin costs of the insurance companies.

I don't understand the support for the insurance companies, who are parasites on the health care system. They offer a very complicated product that sucks money out of the system that could be used for health care or reduced costs. Other countries systems cost way less, with better health outcomes. Why can't we learn from them and build a similar system here?

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George Hresko 6 months, 2 weeks ago

Lock--My apologies first for stepping in to this conversation. How many doctors have you talked with about their data keeping requirements? Your position is that the docs big problem is with the info for the insurance companies. Have you studied that? I suggest the bigger, growing faster and showing no signs of not growing, is the data keeping requirements for our friends in DC! Any doc accepting ACA, Medicare and Medicaid has the Fed's data keeping requirements imposed upon them. My thought is that is why docs are leaving the government system so they are not burdened with those requirements. Any data you have to the contrary would be appreciated.

BTW, I agree with Michael, CoCa must show somehow that it will be able to operate more effectively and efficiently than the insurers. UHC has 70 million insured. Economic scale mitigates against CoCa being able to operate at the same cost level, even if one rises above the challenges of getting a government bureauacracy operating at the cost level of a competitve enterprise.

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Lock McShane 6 months, 2 weeks ago

I have not asked about data keeping requirements. I have inquired with the front desk personnel at my doctor's office and at the hospital about the requirements of dealing with the insurance companies and they both agreed that the system is way too complicated and requires too many man-hours to comply. I admit it is a small sample size, but I doubt the answer would be very different at other provider's offices.

I think that dealing with the insurance companies is much harder than collecting data about patients. The problem now with data acquisition is that each provider has a different system that doesn't communicate with others and there is no central repository for all my medical data. I want my own medical data collected in one place that all providers can access and add to.

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Scott Wedel 6 months, 2 weeks ago

The independent Colorado Health Institute analysis considered the issue of CC negotiating better prices. They noted that the major existing health insurance companies are much larger that CC representing all Colorado residents so if size matters then CC would be in a weaker position than what it is replacing.

While Medicare can't negotiate prices, it is commonly lobbied by medical equipment providers to expand coverage using new equipment. Proton Beam manufacturers successfully lobbied Medicare to allow 30+% more expensive Proton Beam Treatments. Health insurance companies were far less willing to pay for PBT because of the costs. Thus, I think it is far more likely that CC will face political pressure and lobbying to pay for various more expensive treatments than health insurance companies would approve.

This is yet another example of CC claiming that it will be better based upon pure fantasy.

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Michael Bird 6 months, 2 weeks ago

May I suggest that all read the Denver Post editorial in the Oct 16th edition on page 3D.. It is titled Reject Colorado Care

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Michael Bird 6 months, 1 week ago

Lock, "Basically the savings would come from reduced administrative costs " ( your statement above ) is what I have been talking about. Use 25% instead of 20%. That still leaves the majority of costs as medical and not administrative. You have made my point. CC does not reduce medical costs. To do so would require all providers to be paid less. starting with MDs. In reality, medical costs rise and are projected to rise much more than any unproven savings CC might provide in administrative costs. Remember CC has not provided one cost - no cost of the CEO, no total personnel costs, nothing, nada, zippo. What a great deal - no facts, - just comments and suppositions. As Jerry McGuire said " Show me the money".

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