Doctors Sue to Stop Health Insurers’ Usual and Customary Fraud
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We consumers of medical care aren’t the only ones who have been short changed by major U.S. health insurers. According to an AP story in today’s NY Times, physicians have been cheated out of fees they earned for treating patients insured through such companies, which include Cigna and Aetna.
This has prompted the American Medical Association to join several other state medical associations in suing the health insureres “over a database…that was rigged to underpay doctors on out-of-network claims for more than a decade,” according to the AP.
The report notes that UnitedHealth has already paid $350 million in a separate suit involving the A.M.A.
So, let’s recap. Major U.S. health insurance companies cheat the people they insure, and cheat the physicians they employ to treat their insureds. Is there anyone left for them to swindle? Could this have contributed to the healthcare “crisis” in our country? Will the Obama team scrutinize this sleazy industry to the same degree they are scrutinizing Wall Street? At this time when the new administration is evaluating how to improve and reform healthcare, let’s hope that the health insurers’ fraudulent practices, which hurt both the consumers of healthcare and the providers of it, receive a prompt and careful look.
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throckmorton said:
I agree with you that the Major U.S. health insurance companies have practices cheap both the people they insure and the health care providers. This is a partial cause of the rising cost of healthcare. Another major factor is just the business model of how health insurance companies make money. They make it on the interest of the money that they hold until they pay it out (or the portion of it they pay out). As they make their profit on the interest, there are several things they can do to increase their bottom line. First is what you have brought up, that is avoid paying claims. The second is what is perhaps the most damaging. For a health insurance company to make the most money, they have to have the most money that they can get paid to them in the form of premiums. This allows them to collect the most interest. So, to make sure that the most amount of money is coming in to them it is essential to have the price of healthcare increase. Despite what is commonly stated by them, they dont mind paying the money out as long as they are getting the most coming in. Right now that is about $768 dollars a month per employee. Because the money is there, the cost of healthcare will meet what the insurance providers will pay. This is the cycle that keeps the costs gong up.
So, how do we fix the problem? Competition is what lowers prices. Right now we really do not have competition. There are only a few big players. Opening up the borders of states to allow other choices for healthcare is one answer. The more insurance companies have to compete with each other, the better the rates for the insured will be. The second part of competition is the publication of healthcare charges by physicians, hospitals, etc. This should include private pay prices and prices paid by each insurance company. (Different physicians and hospitals are paid different amounts by the same insurance company) The long and short of it. We need to allow hospitals, doctors, and insurance companies to compete.
The last thing is what the health insurance companies do not want. Instead of your employer paying the health insurance premium, each of those insured needs to be the one who writes the check. The insurance comany needs to publish how much they will pay and for what and this needs to be given to each person insured. Then the patients are billed directly by the hospital, doctor, etc. and must be re-embursed by the health insurance company. This will cause the smart shopping patient to get their care where they get the most for their insurance dollars.
In many ways, our health insurance system is like the Federal Withholding Income Tax. If you seperate the person from their money before they knowthey have it, you can do anything you want with it. It is often said that our government would be a whole lot different if you paid your taxes in one big personal check at the end of the year.
February 14th, 2009 at 6:43 pm