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The Real Problem With Healthcare in U.S.

For over eight years, the Democrats and now the Republicans have struggled with the politics (and business) of healthcare in America. More accurately, the topic has been health insurance in America, and nothing has been done to address the actual cause of high insurance costs.

The real problem with healthcare in America starts with the root of the issue, namely health.

This article is short and simple — because the problem is extremely simple, and the solution is short. Eat right, don’t smoke and exercise.

I can see you sitting behind your computer screens laughing – ha! You’re saying, “Troy, if was that simple to get people to put down the cheeseburger, throw away their cigarette and actually do those workout videos they’re watching on YouTube, why hasn’t it happened yet?”

Perhaps the root of the problem is all the dialogue around other ways to motivate Americans rather than address these very easy, tangible solutions to improve American health.

If we can get back to basics and repeat (over and over again), “Eat right, don’t smoke and exercise,” we can move the needle.

It’s Expensive to Ignore Prevention

We all know health insurance is expensive because healthcare is expensive. Healthcare is expensive because as a nation we don’t eat right, we don’t exercise and some people still smoke.

The fiscal impact of poor diet and exercise in America is staggering. The Center for Science in Public Interest reported that in the last 30 years obesity rates have doubled in adults, tripled in children and quadrupled in adolescents.

What were the two leading causes of premature death in 2010? Diet and tobacco.

See also: Healthcare: Need for Transparency  

If we ate better and exercised, our nation’s financial problems would be solved. We spend a cool $245 billion on treating cardiovascular disease and Type II diabetes. This expense is almost always associated with bad lifestyle choices (diet and inactivity) made by the individual.

Freedom is great, but people should pay for their decisions. If a car driver received multiple speeding tickets, his insurance premium would go up. This is common sense, but health insurance premiums (for the most part) do not follow this logic.

Two single people of the same age, living in the same Zipcode will likely pay the same medical insurance premium even if one chooses to smoke, eat poorly and never exercise. The person who chooses to take care of his or her body is in no way rewarded with a lower insurance premium.

Incentives, eh?

Some companies choose to reward their employees with lower insurance premiums for weight loss, smoking cessation, etc. Those companies should be applauded, but there is no real incentive for better health at the national level.

The Affordable Care Act tries (operative word: “tries”) to cultivate a nation of better health with provisions such as the “smoker’s premium penalty.” It’s designed to enforce higher medical insurance premiums for smokers relative to non-smokers.

On the surface, this approach appears to make common economic sense: Associate the risk cost with the price. The approach fails because it’s simply a band-aid and an act of showmanship. In its first of year of implementation, a Yale School of Public Health study found that “tobacco surcharge resulted in lower enrollment among smokers, without an increase in smoking cessation.”

The ACA smoker’s premium penalty will have no impact on saving lives or money. Without significant support and incentive, many states simply opted out of the smoker’s premium penalty or capped the 50% surcharges substantially lower (between 10% and 40%).

Other options allow a smoker to say he or she is trying to quit, thereby avoiding the premium increase altogether.

The Government Is Making Us Fat

The U.S. government is a major contributor to the obesity and poor health of today’s Americans. By offering subsidies on tobacco, dairy and meat products, the government offers a window of opportunity for these producers to lower their prices and increase consumption. As a result, they’re perpetuating a generational cycle of poor health and increasing the damage with every generation.

The government launched national dietary guidelines and the food pyramid in the 1980s – an attempt to stabilize and grow the economy. In an article on the government’s role in our nation’s health crisis, Dr. Wolfson writes, “Despite overwhelming evidence, the food pyramid advised Americans to eat the things that made them sick and to avoid the things that made them healthy. On what planet of delusion could the creators of this pyramid be from? The grain category is twice the size of the vegetable category! This planet could only be controlled by food manufacturers.”

This cycle shows no sign of changing. Our policies on scientific studies continually “allow studies concerning practices and health impacts to be funded and conducted by the very corporations that created them and profit from their sales.”

Within the last eight years, the most prominent and political voice on better health is Michelle Obama. When the former First Lady suggested we occasionally skip dessert or eat more carrots, she was told by Republicans to “Stay out of my kitchen” and “Don’t you have something better to spend your time on?”

The Republicans should have embraced some, but not all, of her ideas. The Republicans should have distanced themselves from some of the misguided school meal programs but totally embraced her core message of better diet and exercise.

Education or Marketing?

Diet education is also a problem. For decades, most television and print ads for food and drink have pushed extremely unhealthy choices. Milk doesn’t do a body good. Beef should not be what’s for dinner. Do not hanker for a hunk or a slab or chunk of cheese.

In “How Big Government helps Big Dairy sell Milk,” the dairy industry has spent billions of dollars to convince consumers that milk is the only way to get their best recommendations of calcium, potassium and protein – even though you can get the same amount from fruits and vegetables.

See also: U.S. Healthcare: No Simple Insurtech Fix  

Positive, popular TV shows are making attempts to debunk this misinformation and take jabs at America’s poor diet. In a “Family Guy” episode, Peter Griffin’s solution to cooking is to consume obscene amounts of butter, and he’s met with an instant stroke, followed by a heart attack, stroke, another stroke, heart attack – you get the picture.

Small Steps Forward

We have a reactive healthcare delivery system in America. When health savings accounts (HSAs) were introduced, they were slow to be accepted. Most private insurance in America is sold through health insurance brokers. Initially, brokers offering HSAs were asked to do twice as much work and make half as much money.

Now, HSAs are more commonplace and have some excellent features. A free annual checkup is always part of the plan. If people improve their health and don’t spend as much on medical care, they pocket the savings.

There is no fountain of youth, and there is no magic pill. As Dr. Leonard McCoy said in “Star Trek: The Omega Glory”: “It might eventually cure the common cold but lengthen lives? Poppycock! I can do more for you if you just eat right and exercise regularly.”

When diet is wrong, medicine is of no use.
When diet is correct, medicine is of no need.
Ayurvedic proverb

The State of the Nation’s Private Employer Exchanges: Crazy!

I’m not talking Patsy Cline’s “Crazy” or even Gnarls Barkley’s “Crazy”—I’m talking Peter-Frampton-re-release-the-same-song-and-get-totally-different-results kind of crazy!  In 1975, Frampton released “Show Me the Way” on his album Frampton, and no one cared.  The song was re-released in 1976 on the album Frampton Comes Alive—and topped the charts in both the U.S. and U.K. In Wayne’s World, the song was described as “required listening for all suburbia.”  It’s all marketing, baby!

What does this have to do with private exchanges? Most are just a re-release of technology that has been part of benefits administration enrollment for years.

The following is a short list of “new” capabilities and requirements that are typical for a private exchange:

  • Defined employer contribution, instead of defined benefit.
  • The ability to connect electronically to insurance carriers.
  • Decision support tools, to help determine employees’ best options.
  • Support for core insurance products such as medical, dental and vision.
  • Support for voluntary insurance products such as life, disability and accident.
  • Support for multiple insurance carriers (although some exchanges are single-carrier).
  • HRA and Section 125 pre-tax support.
  • Premium processing and billing support.
  • Support for insurance plan comparison and other employee shopping tools.

Nearly every function defined as “new” for a private exchange is not new—these functions have been part of group benefits administration systems for over a decade.  As I’ve said, the “new” private exchanges are 95% marketing hype and 5% enhanced decision support.

I have attended dozens of conference breakout sessions, read articles, talked to “private exchange” vendors and seen countless demos. The only word I can use to describe the whole group private exchange world is “crazy” — wonderful, “Show Me the Way” kind of crazy.

Given that we’ve been there and done that with the technology in the private exchanges, I can offer some informed observations about how they will play out as employees use them to select coverage under the rules established as part of Obamacare.

–It would be very difficult to move to an Expedia-type shopping model for employees’ insurance. Insurance carrier requirements for participation and underwriting through private exchanges make the disintermediation of the health insurance broker less likely than the disintermediation of the travel agent.  Few exchanges are even talking about vendor participation. It takes years to develop benefits administration systems simply because of the inherent complexity of insurance. A good technologically and customer service driven health insurance adviser is worth her weight in gold, and will continue to be.

–While Health Sherpa has been described as a somewhat functional equivalent to healthcare.gov, that claim is, well, crazy. Health Sherpa—although a great idea—has no ability to process eligibility, enrollment, carrier connectivity or anything required in a true benefits enrollment or exchange platform.  Health Sherpa is a clean front end for displaying plan options and rates but has no back end to support the followthrough required by the carriers or the federal or state governments.

–Recently, the president invited executives from a few of the nation’s top tech companies to the White House for a highly publicized meeting.  Why?  What do Yahoo and Amazon know about health insurance exchanges, enrollment, eligibility and carrier connectivity?  Exactly nothing!

If the president wanted more than a photo op, why didn’t he call Rich Gallun or Don Garlitz from bSwift or ask my company, benefitsCONNECT, to join the discussion? Between us, we accurately and electronically process many millions of enrollments—completely eliminating the need for paper. Either company could have saved this country hundreds of millions of dollars and produced a public exchange for Obamacare that actually works.

There’s actually one thing that’s new about private exchanges: While benefits administrations systems have become somewhat standardized, if you’ve seen one private exchange—you’ve seen exactly one private exchange. They are all different, from their front-end requirements to their back-end requirements.

As I said, it’s a craaaazy world we live in.