How European countries regulate private insurance

[eridani]

http://www.pnhp.org/print/news/2012/december/it’s-not-profit-that-is-destroying-our-health-it’s-the-private-insurance-business


Many Europeans use private health insurance companies, a few of them for-profit. These Europeans enjoy better care for more people at lower cost than we do. But the European business model differs radically from that in the U.S. In fact, American insurance companies find the European model not only alien, but intolerable. Imagine American insurance companies playing by these European rules:

* You can set any price on your policy, but you must sell it at the same price to everyone, regardless of health.
* You must sell a policy to anyone who applies, no exceptions.
* No policy can be cancelled for any reason, not even failure to pay (the government will step in). Patients, however, can change companies without notice.
* Every policy must cover all treatable diseases. No matter what policy they purchase, patients will never risk destitution (or death) if they suffer a treatable condition.
* Your company must pay every claim from every licensed provider within 30 days. You can protest the payment, but only after you pay the bill.
* Every provider receives the same payment for the same service, regardless of patient or their insurance.
* Your records are an open book. Every dollar (or Euro) that passes through your hands is open to the public. There are no proprietary secrets.
* If you still manage to cherry pick healthier patients, the government will impose a premium to subsidize other companies with sicker patients.

With this model, European companies compete with lower prices, extra benefits, and better customer service. Isn’t that a refreshing change?

The American business model has no such rules. How do American insurance companies compete?

[dipsydoodle]

1. 404 – Page not found

Last edited Thu Dec 6, 2012, 08:22 AM - Edit history (1)

btw - European companies ? None of that applies to private healthcare in the UK.

In the UK we've got the NHS who do in fact contract out some work to the private industry. That is between the NHS and those companies and has no bearing whatsoever on end users who've got complete cover from conception to pushing up the daisies come what may.

There are European countries whose socialised healthcare operates THROUGH private companies and it to those I think this refers

[eridani]

2. I think the apostrophe did it---I'll try to get a permalink n/t

[dipsydoodle]

3. I'd already tried

taking out the end "it" which I think belonged to "its" What was the original title of the article if not what you used ?

[dipsydoodle]

4. Sorted.

Its this : http://www.pnhp.org/print/news/2012/december/it%E2%80%99s-not-profit-that-is-destroying-our-health-it%E2%80%99s-the-private-insurance-business

[mtasselin]

5. Yea

This would be one of the best things that could happen to our country in a long time. Keeping my fingers crossed.

[Flatulo]

6. ACA makes a baby step towards this model - Imsurance cos must spend

80% of premiums on patient care.

I don't see any of them fleeing. 20% profit margin is really very good; most companies operate at a 5 to 8% margin and are considered very successful if they can pull it off.

I dare say we could squeeze them a bit harder before they would start to bug out.

I see the bigger problem in the US as the patient having no say in the costing process. Doctor orders an expensive test, insurance company pays and passes cost onto the consumer in the form of premium increases, which we are forced by law to pay.

My own pain doctor charges close to $1000 for a five-minute visit to refill prescriptions. Insurance company pays some peecentage of that. Where is my input? Nowhere, and I assure you that I wouldn't pay Jesus Christ a grand for five minutes of his time.

If the consumer were incentivized to become involved in the pricing scheme, I think prices would come down.

[eridani]

10. Know what average MLR was back in 1993 when the Clintons were dealing with a "crisis"

--in health care financing? 95%--that's what. That's what it should have been for ACA.

[Egalitarian Thug]

11. You're kidding right? This is why we are so fucked up, people don't even know when they're

being screwed, because they never look into anything. I thought it was 85% and that is more than what they were already doing. The only real things the misnamed ACA did was preexisting conditions, make it a little harder to cherry pick, let parent keep their kids o their plans longer, and eliminate lifetime caps.

This was a boon to the biggest cause of so many problems in our system and it doesn't even give access to everybody.

It's not a baby step so much as it's a generational roadblock to any future reform.

[JHB]

14. The 20% isn't the profit margin, it's everything other than patient care

For instance,the insurance company's own administrative costs, payroll, etc. are part of that 20%. The 80% has to go to actual services to patients.

I'm not sure what the actual profit works out to, I'm just pointing out that characterizing the 20% part as "20% profit" is mistaken.

[bornskeptic]

16. Health Insurance Company profits run around 4%.

The health-care sector is absurdly profitable. According to this data at Yahoo Finance, the sector-wide profit margin is 21.5 percent. But the insurance industry is one of its least-profitable parts: Its profit margin is at 4.54 percent. Hospitals are also a bit strapped, with an average margin of 3.5 percent.

So where's the money going? Drugs and medical technology, mainly. The major drug manufacturers have a 23 percent profit margin. The medical device makers are pulling in 12.6 percent. And this is all happening despite the fact that researchers are having a very difficult time showing that there's much benefit -- either in longevity or quality of life -- to all these new, and incredibly expensive, treatments. I don't want to call this spending waste, exactly. Some of the treatments do improve health, and the money on the table is a good incentive to innovate. But just squeezing insurers and hospitals won't control costs unless the insurers and hospitals can figure out some credible way to either squeeze drug and device makers or somehow ration their products.

http://voices.washingtonpost.com/ezra-klein/2011/02/health-insurance_industry_stil.html

Individual Insurance and Small Group insurance have total overhead of about 20%, but Large Group Insurance is much more efficient. Large Group plans tend to have MLRs around 85%, which is what is mandated by the ACA. Most of the overhead is payroll.

[Prophet 451]

29. That sounds like a damn good argument...

...for regulating the fuck out of the drug companies as well.

[eridani]

17. Their administrative costs and payroll are mostly wasteful nonsense n/t

[Flatulo]

18. There you go. Single-payer would save about 25% of our annual costs. nt

[Flatulo]

19. Sorry, I stand corrected. The 20% includes all administrative costs and overhead. nt

[NoOneMan]

27. If the MLR is positive, why aren't per capita health costs going down?

Either these companies aren't being squeezed at all by it or there was nothing significant to squeeze (I tend to think its the first).

At the end of the day, the MLR only applies an additional market pressure for health insurance companies to negotiate higher rates with providers. The pie increases, and their slice is now institutionalized by law.

[brokechris]

7. I don't understand this--

as every country in Europe has a different model for health care. There are no rules for insurance companies that apply to every European country. In fact in quite a few--there is no such thing as private insurance.

Can you provide a source for this?

[Egalitarian Thug]

12. She did. n/t

[brokechris]

20. all the supposed "source" says

Last edited Sat Dec 8, 2012, 02:11 PM - Edit history (1)

is 404-page not found. So I am still as a loss as to how to evaluate that source.

And I have lived throughout Europe--my parents were military, so I know this is B.S.

Each country has their own separate system--and some are single payer (no private insurance at all), some are two-tier, and others are mandated insurance. There are no insurance rules that apply to ALL European countries.

OP is stating that this model applies to "European Countries"--implying it is a truth throughout Europe, whether the country is Britain or Slovakia --this is 100% false.

[Egalitarian Thug]

21. It's a glitch with this and other sites. Copy the whole thing, not just the blue part,

and paste it into your browsers address bar.

There are NO European nations that allow anything like the predatory system we have here. Neither are there are any Asian countries that allow them. Many nations have what they call insurance companies, but ours are unique. It is a problem of language, not function.

Or just click this one.

[brokechris]

22. I agree that the insurance companies are predatory--however

I still strongly disagree with the assertion that all these other countries have a unified insurance policy that they share. This has become even more ridiculous with you bringing in Asia, where in many cases access to good health care is often even worse than in our system.

And once again in Asia (as I have already pointed out for Europe)--each country is doing their own thing--"Asia" is not one unified area with a common policy regarding health insurance regulation.

In Asia out-of-pocket expenditures account for the highest share of total health spending. In the few areas where private health insurance markets have developed for the most part they are without an adequate regulatory framework and these countries run the risk of exacerbating inequalities in access to health care. See: Sen, P."Community Control of Health Financing: A Review of Local Experiences", Technical Report, Partnership for Health Reform, USAID/Abt Associates, Washington, DC. 1998

India is the largest market in the region, where only 3.3% of the population is covered (33 million people). See: Chollet DJ, Lewis M. Private insurance: principles and practice. In: Schieber G.J., editor. Innovations in Health Care Financing. Washington, D.C.: The World Bank, 1997: 77-114.

China has explored private insurance in urban areas and has also opened its market to foreign companies. A few Pacific Island countries (e.g. Fiji, Samoa and Papua New Guinea) have had foreign insurers enter their markets to provide coverage for services in the islands and enable access to care in Australia and New Zealand. See: Bayarsaikhan D. Information on private insurance. with N. Sekhri. 4-11-2003.

Both the Philippines and Indonesia have made forays into private health insurance with varying levels of success. In the early 1990s, Indonesia introduced private health insurance schemes based on Health Maintenance Organization (HMO) principles. See: Thabrany H, Gani A, Pujianto., Mayanda L, Mahlil., Budi BS. Social health insurance in Indonesia: Current status and the plan for a national health insurance. WHO/SEARO. 2003

The Philippines has created a quasi-public agency called the Philippines Insurance Corporation, which sells individual private health insurance policies in addition to managing the country’s growing social insurance program. See: Phillipines Insurance Co., Presentation at SEARO Meeting on Social Insurance. July, 2003.

****I saw the OP as more of a dream--a Progressive vision of what insurance should be. It is possible that all these rule apply in some enlightened country and that most are common in those with mandated insurance (which is not very many countries), however these rules are definitely are not standard across Europe as claimed by the OP. Not sure why you brought in Asia--but that is even more laughable.

[Egalitarian Thug]

25. You really need to read more carefully.

[brokechris]

28. LOL (quotes from OP in Italics)

Title of thread:
How European countries regulate private insurance
(laughable--the European countries have no standard for regulating private insurance--in fact for some private insurance doesn't even exist)
........
the European business model differs radically from that in the U.S. In fact, American insurance companies find the European model not only alien, but intolerable. Imagine American insurance companies playing by these European rules: (then the list of supposed rules)

***as has been pointed out there is no standard European business model for private insurance--every country deals with this differently--some do not deal with it at all. So the idea of American insurance companies playing by "European rules" is ridiculous.

With this model, European companies compete with lower prices, extra benefits, and better customer service. Isn’t that a refreshing change?

just pure silliness. There is no European model. It is a FACT that every country has their own mode of handling health care. In some of the single payer systems--private health care insurance doesn't even exist--much less follow some model. Other countries have a two-tiered system and some have mandated insurance. There is no standard "European" model that we could be following for.

Obamacare is closest to the system that is in place in Switzerland (mandated insurance)--however it has little in common with the single payer of Britain, or the two-tiered system of France and Germany.

If we want to discuss healthcare intelligently, we cannot pretend that there is a standard European business model for regulating the health care system--because that is a fantasy.

[Bluenorthwest]

30. You say: "some are single payer " but only one is single payer....

I only split that hair because you are playing silly word games with the OP. It does not say there is a unified system shared by all European nations, it does say the various systems have certain things in common which are not shared with our system. Elements in common does not mean unified system, just as 'some have' does not mean 'one has'.

[brokechris]

31. no--it is not just ONE country that has Single Payer in Europe.

Countries with Single Payer in Europe:
Norway
United Kingdom
Sweden
Finland
Slovenia
Italy
Portugal
Cyprus
Spain

[Egalitarian Thug]

34. Let me rephrase, you need to stop reading what you want to see into it and read what was written.

No place in the OP did she, or the article from which it was taken, write that any of these rules are uniform across the EU. That's just something you wanted to see and then based your arguments on that.

You also tend to emphasize the less important part of the sentence and ignore the main point.

[Scuba]

8. "... you must sell it at the same price to everyone, regardless of health." Why, that's ...

... risk-sharing, which is the purported benefit of insurance. Or was the benefit, before insurance companies decided it was way more profitable to insure only healthy people.

Have a "pre-existing condition"? Sorry, no insurance for you.

Get sick? We'll drop you.

No more, risk, only greater profits!

[Flatulo]

9. No shit, right? Back in the day that was generally understood to be the definition of insurance.

Decades of gutless government has let these scoundrels rig the game.

The absolute worst has to be long-term disability insurance. They simply never pay under their pre-existing condition rules. If you fell off your fucking tricycle when you were 5 they'll find out about it and deny your claim for brain cancer 50 years later. If in the odd chance they cannot claim pre-existing, they'll just deny the disability and drag you down in court until you finally die.

LTD insurance is simply the biggest insurance scam in existence.

[Kurovski]

13. Yes eridani, that is indeed refreshing.

K&R

[woo me with science]

15. K&R

[Nye Bevan]

23. Starting in 2014, Obamacare brings us most of this list (nt)

[TheKentuckian]

32. Odd definition of most. Almost none is a majority now?

* You can set any price on your policy, but you must sell it at the same price to everyone, regardless of health. No

* You must sell a policy to anyone who applies, no exceptions. Yes

* No policy can be cancelled for any reason, not even failure to pay (the government will step in). Patients, however, can change companies without notice. No

* Every policy must cover all treatable diseases. No matter what policy they purchase, patients will never risk destitution (or death) if they suffer a treatable condition. No

* Your company must pay every claim from every licensed provider within 30 days. You can protest the payment, but only after you pay the bill. No

* Every provider receives the same payment for the same service, regardless of patient or their insurance. No

* Your records are an open book. Every dollar (or Euro) that passes through your hands is open to the public. There are no proprietary secrets. No

* If you still manage to cherry pick healthier patients, the government will impose a premium to subsidize other companies with sicker patients. No

[Nye Bevan]

33. Your first bullet point should be "yes".

Starting on 1/1/14, insurers cannot charge different prices depending on your health.

[eridani]

35. They can charge different prices depending on your age, which amounts to the same thing.

In Europe, there is ONE basic policy type available for all, though people are allowed to buy extra bells and whistles if they want. ACA divides us into Platinum, Gold, Silver and Bronze people. There should probably be a Lead designation for those over 55.

[Nye Bevan]

36. NO. Not platinum / gold etc. PEOPLE. They are different choices of POLICIES.

The absolute key point is that a 45 year old (for example) with several chronic, expensive medical conditions MUST be offered a policy on exactly the same terms as a 45 year old in perfect health, starting in 2014.

[eridani]

37. If the policy you want is one that you cannot afford, there is no fucking "choice" about it

It is morally appalling to offer a series of plans from fairly good to seriously shitty, and charge much more for the former. All civilized countries have ONE basic plan, period. People with more money are free to buy add-ons, but the basic plans are far, far better than what is generally available here.

[TheKentuckian]

38. They can charge differently according to age, and that is limited to the exchanges as far as I can

tell and most people are excluded to subsidized policies there.

[JaneyVee]

24. Americans get hosed.

[Whovian]

26. Great post. Thank you.

I'm beginning to believe this country has gone Neanderthal.