Some people may see rebate checks coming their way as a result of health care reform.  Here’s why:  The Affordable Care Act (ACA) contains a provision called the “Medical Loss Ratio” requirement that requires health insurers (i.e. health insurance companies) in what is called the individual and small-group markets to spend at least 80% of premium dollars they receive on actual medical care (and quality improvements).  For large group market plans, the percentage is 85%.  As a result, 20% of premiums in the individual and small group markets can go to the insurers’ overhead.


But what happens under the law if the insurers fail to comply with the required Medical Loss Ratios and only spend, say, 70% of premium dollars on actual health care and 30% goes to overhead (salaries, marketing, etc.)?  The insurers have to pay rebates to policyholders.


Based on a recent analysis conducted by the Henry J. Kaiser Family Foundation, rebates should be on their way.  Kaiser estimates that in the individual market, 31% of consumers will receive rebates, with 28% of employers in the small group market receiving rebates.  Admittedly, these rebates on an individual basis will not be large, but in the aggregate the estimated totals are impressive - $426 million in the individual market and $377 million in the small group market.


Will this make insurers more efficient in their operations?  Do tax policies and penalties change behavior?  Often the answer is yes.

22. April 2012 · Comments Off · Categories: Living · Tags: ,

I’ve just read a fascinating article, “Jogging Your Brain,” in today’s NYTimes magazine, which I would have titled “Making Neurons Nimble.”  I won’t steal the article’s thunder by stating the story’s conclusions – “exercise jump-starts neurogenesis.”

Neurogenesis is the creation of new brain cells (simply, if inelegantly, put).  Research suggests that exercise prompts an increase in “brain derived neurotropic factor (B.D.N.F.), a substance that strengthens cells and axons, and fortifies the connections among neurons and sparks neurogenesis.”  There is more to it than just that, of course, but the benefits of exercise on the millions of chemical reactions that take place within the body continue to astound me.


Hold on to your hats, because New Hampshire could enact one of the toughest “anti-self-referral” statutes in the US.  If HB 1725 passes and you are a New Hampshire physician (a) who may profit, indirectly or directly, from the sale of an FDA class II or class II medical device or (b) who may perform a procedure involving the device, you could be charged with (1) an unfair or deceptive act or practice in violation of NH Consumer Protection statute, and (2) a fine of $5000 for a first offense and loss of your license for a second offense.  Ouch!

In addition, HB 1725 as passed by the NH House in March specifically disallows any claims for payment for “any medical device provided” in violation of this proposed law.

So, what’s going on?  Is there a problem with physician owned distributors in New Hampshire?  I am not aware of any.   At the same time, there are certainly physicians who have been active in creating and inventing particular devices in association with academic medical centers or medical device manufacturing firms to make newer and improved devices.  Is this a “problem” that the State feels is necessary to correct at the moment?  Or does the NH House think the laws should be “clarified” prior to an “onslaught” of distributors.

We already have a law in place that requires a physician to disclose to patients the physician’s ownership interest in any health care facility that the physician may refer patients.  It seems to work well because it does not impede care.  It seems to me that this could be extended to devices, as well.  HB 1725, on the other hand, directly impedes care in those circumstances where a physician has a monetary interest in the device.  Certainly, it is a good idea for full disclosure of some sort of interest to be made, but HB 1725, as presently written, does not allow the physician to even consider the use of a device that the physician herself may have a monetary interest in, or may wish to employ to help a patient.

My sense is that a “bad story” came to certain legislators’ attention.  We will see on April 19 how the NH Senate addresses the bill.