The High Cost of Health Insurance: Talk v. Action

My background is research. Inquiring minds really do want to know, and with a few phone calls and quality time on the Internet, you can find out a lot.

In my work, I’ve run into three types of people:

  • Those who charge high prices for health insurance
  • Those who complain about the high prices for health insurance
  • Those who do something about it

Yes, really, the third category exists. Apart from the Marketplace, I know of at least two good ways to cut costs dramatically without skimping on coverage. These are solutions provided by established organizations, not something I’ve cooked up. However, most people don’t know about them.

Best of all, they don’t involve any political uncertainty. “Trump” is not part of the vocabulary for these solutions.

I’m not going to explain them here, because I might run afoul of regulators saying that I’m providing insurance advice in a state in which I haven’t paid for a license yet.  (I’m licensed in NJ, PA, MO and VA.) If I don’t handle your area, I will still tell you what the solutions are and provide a referral to someone who can help you.

So if you want more information, you’re going to have to call or email me.

609-510-3712

vic@craininsurancellc.com

This is my way of trying to be useful.

Vic Crain

Small Business Health Insurance: Missing the Point

The Centers for Medicare and Medicaid Services (CMS) issued a press release on 15 May, mark_twain_congress_quote-511892offering new ways for small businesses to enroll in health insurance in addition to the SHOP marketplace provided by the ACA. The release also took the opportunity to make some partisan jabs at the ACA and the low rate of participation by small businesses in SHOP.

As an agent certified in SHOP, the CMS press release shows a complete misunderstanding of the problem. Think of the choices businesses face:

  1. You can buy policies for your employees at full price through SHOP.
  2. You can reimburse employee costs for purchasing subsidized health insurance by using an HRA and or HSA  as revised in December.
  3. You can buy much lower  cost policies using a hybrid self-insured approach.

The first method provides no financial incentives — so why do it?

The new options offered by CMS provide no financial incentives — so why do them either?

However, for CMS now to say that the ACA has been ineffective in serving small business is unfounded. CMS doesn’t in fact know how many businesses have chose Option 2.

Of course, the virtue of Option 3 is that politicians have nothing to do with it.

The major barriers facing most business owners with options 2 or 3 is awareness — they don’t know these options have been available.  However, they are, and they could save a lot of money.

Only politicians could design a program with no value and then wonder why no one is using it.


Sources:  Centers for Medicare and Medicaid Services Offers New Health Coverage Enrollment Option for Small Business, Press release, 15 May 2017.   

Insurance: Please don’t buy this!

135354-RumorsJust because someone offers a product, that’s no reason to buy it.  Some just don’t make sense, except perhaps in an alternative universe.

The newest entrant in this category is something called “Active Shooter” insurance.  These policies first appeared on the market in 2015 and are designed for business owners.

Now let’s think about this.  The US averages 51 deaths due to lightning strikes per year (source: NOAA).  It’s probably fair to assume that this averages one death per lightning event.  The most common activity among victims when hit by lightning was fishing.

Now, between 2000 and 2013, there were an average of 11.4 mass shooting events in the US each year (source FBI).  This number has risen recently, of course.  The FBI reports 20 such incidents in each of 2014 and 2015.  The number of people killed per event is greater than in the case of lightning strikes, but still, there were only 20 of these.  There were 20.9 million business in the US as of 2010 (Census), so the odds of a business incurring an active shooter event is 0.0000095694%.

The business has a much better chance of being hit by lightning.  How many businesses have lightning rods?

By the way, if you believe in Apocalypse theory, most insurance policies exclude claims due to “acts of war.”  Earlier this week, commentators on Fox endorsed the US “declaring war” on ISIS.  That recommendation would elevate ISIS to the status of a country AND eliminate some insurance protections Americans do have.  That’s why you don’t listen to Fox.

Anyway, Active Shooter insurance seems to me to be a silly way for the paranoid to waste money.  If you have money to waste, I can think of lots of better ways.