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Thank you so much for helping me get my insurance so quickly. I appreciate all of your help. I will definitely recommend you to my fellow classmates.
— Dave
Mr. Higgins explained in ways that I can understand. His compassion was unequal!
— Roxanne,
Thanks, Michael, I truly appreciate your prompt assistance…
— Laura
Thank you. This is helpful and I appreciate your time and assistance.
— Rick,
I was glad that you answered the phone. I know I made a good choice choosing you as my broker and applying with Blue Cross Blue Shield of Arizona. The more I think about it, the more I want to be with a company that has widespread recognition and is everywhere. So thanks again for everything!
— Liza,
“Hi Mike,
…my mother lives in Texas, but I thought I would ask you (a question about health insurance,) since the
comments about you on the website were heartfelt.

Thank you.

-L.M.
Houston, TX
— Rick,

“Mike,

You have provided professional & friendly guidance to our family for so many years and I hope you know how much we appreciate your help!!

Sincerely,

Charlotte”

Health Care Costs To Rise Significantly


Federal health care spending is to increase an average of 5.7% each year for the next decade. Health care spending was 3.6% last year, mainly due to the slow economic recovery, and the fact that the private sector is picking up more of the tab in the form of higher deductibles and co-pays.

Currently, health spending financed by government agencies represents 44% of all health care spending in the country, (Medicare and Medicaid primarily,) and this figure is projected to increase to 48% within the next ten years. Coverage expansion of the Affordable Care Act, and an aging population, are the top two reasons for this increase. Today, the U.S.A. spends 17% of the GDP on health care, and by 2023 it will be nearly 20%.

In 2015, Medicare spending is projected to decrease by 2.7%, almost entirely due to the $716 billion dollar cut to the Medicare Advantage program, spread over ten years. These funds are now used to help pay for the Affordable Care Act. Unfortunately, many seniors have been forced to switch doctors or plans due to these cuts. More and more providers will stop accepting patients with this type of coverage due to the lower reimbursement rates paid by the government, demanding higher reimbursement rates from private insurers. This of course will lead to ever increasing premium increases and higher out of pocket costs. Adding to the problem are an increased number of baby-boomers enrolling in Medicare starting in 2016, when Medicare spending is projected to rebound to 7.3% from 2.7% in 2015. More federal spending on health care, a doctor shortage presently, and fewer providers accepting government reimbursement rates, all point to higher premiums for the foreseeable future.

Premium rate increases are projected to be nearly 6% per year for the next decade, and out of pocket expenses are to increase 6% per year as well.

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Posted by:
Michael Higgins

Posted on:
December 22nd, 2014

Posted in:

If Obamacare Implodes


It is quite possible that in June of 2015 the PPACA, (Obamacare,) will be dealt a deadly blow by the Supreme Court. The case, King v. Burwell, challenges the legality of the federal subsidies being paid out to 4 million people in 37 states. Challengers of the law state that the IRS has no authority to pay out subsidies in states that have not set up their own exchanges, of which 37 have not. After the recent mid-term elections, many of these states are governed by Republicans, and the chance of these states creating their own exchange are next to nil.

So what should the Republicans be doing today to prepare for the possible gutting of the PPACA? (It can be argued that the law would not be gutted, but simply require it to be implemented as written.)

1.) Introduce legislation allowing states to opt out of Obamacare and into a simpler system.

2.) In the simpler system, those not offered health insurance coverage through their employers could receive a federally funded credit and purchase a state approved policy, removing ObamaCare’s coverage requirements such as maternity coverage and pediatric dental.

3.) This new federal law would require insurers to offer coverage to anyone that has been continuously covered. The insurer could not charge more for pre-existing conditions, or exclude coverage on these conditions. All other rules and regulations would be handled at the state level.

4.) States would be allowed to use their federal Medicaid monies to help those enrolled pay for private plans.

5.) Those currently receiving subsidies would continue to do so through 2015, giving the states time to set up this new, simpler approach to health insurance for all.

 

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Posted by:
Michael Higgins

Posted on:
December 20th, 2014

Posted in:

Arizona Health Costs Rising


If only it were true that the Patient Protection and Affordable Care Act, (Obamacare,) lowered overall health care spending by paying for the quality of care, as opposed to the quantity of care, as we have been told, our health care system would in fact be more efficient.

In 2001 and 2002, national health care spending rose nearly 10% each year. The following years it began to drop, and by 2008 it had been cut in half. One could argue that spending on health care was significantly reduced during the Bush administration, well before Obamacare. In fact, health care spending continued to stabilize during the first two years of the Obama administration, increases in the 4% range, again before the ACA became the law of the land in March of 2010.

So why has America been spending less on health care since the highs of 2001-02? The deep recession, beginning in 2007, is the main culprit. But in 2003 government health care spending started to drop, four years before the recession, so what major change occurred during this time to reflect such a drop in spending? The answer… HSA’s. Health Savings Accounts were offered to employees at this time, and in 2003 over 1 million people were enrolled in an HSA. Today that number is 17 million. Give the patient an incentive to shop for the best care at the best price, something an HSA accomplishes, with the added incentive to save for retirement tax-free, and health care spending will drop.

Another claim by PPACA proponents is that the law has lowered health care spending, thanks to the delivery system reform included in the legislation. Basically, this portion of the law states that if Medicare doctors and hospitals work together and lower costs below the typical federal reimbursement rate, the government will split the savings with the providers. The CBO calculated that, at best, these reforms will lower federal health care spending by a fraction of one percent, ($5 billion out of $6.4 trillion spent on health care over ten years.) To say that this aspect of the law is already bending the cost curve down in ludicrous.

Far more consequential are the cuts to Medicare included in the law that have lowered federal health care spending. One of the largest Medicare cuts is known as the “productivity adjustment factor,” Hospitals now receive lower reimbursement payments from the government to cover inflation rates each year. This equates to 1% each year, and the compounding effect will be large numbers of hospitals refusing to accept Medicare patients. 1% may not seem like much, but when your margins are in the 1%-4% range, it won’t be long before losing money on Medicare patients is the norm. To make up the shortfall, hospitals and doctors are now charging the private insurers more to see their members, which in turn increases premiums that much more.

 

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Posted by:
Michael Higgins

Posted on:
December 20th, 2014

Posted in:

“Free” Health Insurance Benefit In Arizona


Real money and imaginary money look nothing alike when it comes to Arizona health insurance and the benefits that must be covered by federal mandate. Take birth control medication as an example. The general argument for, “free,” contraception is that insurers will save money by not having to pay for the birth of a child. What many forget is that health insurance companies in Arizona and elsewhere must balance their books at the end of the year. Contraception medication and surgeries cost real money, unknown future maternity costs are a big fat zero on the balance sheet.

Forcing Arizona health insurance companies to cover the pill and abortifacients under their preventive medicine benefits opens the door to other, or all, medications needing to be provided at no cost to the policyholder. Of course there is a cost, maybe not in co-pays, but certainly in premiums. It is a classic case of where does it end?

There is nothing free about having to pay the up front costs of the pill and other medications by Arizona health insurance companies, especially considering the cost of sterilization operations. “Revenue neutral,” does not mean it’s free, there is still the cost of paying the doctor for the prescription, the pharmacy for providing it, and the drug maker for manufacturing it. Health insurance companies cannot promise to pay these costs with imaginary future savings. What they can do, and will, is raise premiums to pay these up front costs.

Many large employers in Arizona are self insured, hiring health insurance companies such as Blue Cross and Blue Shield of Arizona as their Third Party Administrator. These large employers will assume the total cost of this mandate, and it is unlikely they will see a penny in savings down the road. With employee turnover what it is, and a 25 year window to have a baby on average, the possibility of the employer to save premium down the road goes out the other window.

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Posted by:
Michael Higgins

Posted on:
March 13th, 2012

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