Insurance

Mayo Clinic, one of the country’s top hospitals, is in the midst of controversy after its CEO said that the elite medical facility would prioritize the care of patients with private health insurance over those with Medicare and Medicaid.

The prioritization by the Rochester, MN-headquartered medical practice was recently revealed by the Minneapolis Star Tribune . And it has quickly drawn out some sharp critics—as well as sympathizers.

In a statement to the Minnesota Post Bulletin , Dr. Gerard Anderson, the director of the Johns Hopkins Center for Hospital Finance and Management, compared the prioritization to policies seen in developing countries. “This is what happens in many low-income countries. The health system is organized to give the most affluent preference in receiving health care,” he wrote.

Likewise, Minnesota Department of Human Services Commissioner Emily Piper, expressed surprise and concern by the statements of Mayo’s CEO, Dr. John Noseworthy. “Fundamentally, it’s our expectation at DHS that Mayo Clinic will serve our enrollees in public programs on an equal standing with any other Minnesotan that walks in their door,” she said. “We have a lot of questions for Mayo Clinic about how and if and through what process this directive from Dr. Noseworthy is being implemented across their health system.”

Specifically, Noseworthy said in a video to Mayo employees late last year:

We’re asking… if the patient has commercial insurance, or they’re Medicaid or Medicare patients and they’re equal, that we prioritize the commercial insured patients enough so… we can be financially strong at the end of the year.

In statements, Mayo has confirmed Noseworthy’s prioritization and added that about 50 percent of its patients are beneficiaries of government programs. “Balancing payer mix is complex and isn’t unique to Mayo Clinic. It affects much of the industry, but it’s often not talked about. That’s why we feel it is important to talk transparently about these complex issues with our staff.”

Mayo can use its standing as a prestigious institution to negotiate higher prices with commercial insurance companies, but it can’t do the same with the government. As such, those with private insurance can bring more money to the hospital than patients with the same treatments on government programs. Under the ACA, the number of people covered by Medicare and Medicaid has expanded. However, the law also decreased the number of uninsured, which can be costly to hospitals.

In his speech, Noseworthy said that Mayo had reached a “tipping point” with a recent 3.7 percent surge in Medicaid patients. “If we don’t grow the commercially insured patients, we won’t have income at the end of the year to pay our staff, pay the pensions, and so on,” he said. “So we’re looking for a really mild or modest change of a couple percentage points to shift that balance.”

Nevertheless, the nonprofit still generated substantial profits in 2016: $475 million.

Other experts expressed sympathy with the hospital’s perspective. Daniel Polsky, a health economist at the University of Pennsylvania, told STAT that Mayo shouldn’t be chided for the blunt revelation. “I don’t think they should be shamed for saying it,” he said. “I think there should be some public discussion about whether elite systems such as Mayo should provide equal access to all payer types. I don’t know the answer to that, but it’s a reasonable debate.”

A major insurer is warning of increases in fire and subsidence claims due to extreme weather.

LV= General Insurance (GI) said it is dealing with claims costs totalling £1.2 million following the extreme heat and fire related incidents between July 17 and 20.

The majority of claims were caused by a fire starting in a nearby open area or heathland which spread into homeowners’ gardens, it said.

Many claims involve the loss of garages, fences, greenhouses, sheds and tools, garden furniture, and decking as well as lost trees, shrubs and flowers. In a minority of cases, claims involve the total loss of a home.

In one case, a mirror left in the garden was the cause for the fire-related incident, LV= GI said.

The sun’s rays reflected off the mirror and onto a wheelie bin, which caught fire and spread across the garden.

In other cases, compost heaps have helped to fuel fires.

LV= GI said it is gearing up for a subsidence peak. It said that with hose pipe bans on the horizon and soil already dry, August could see a spike similar to 2018, when subsidence claims increased by 51% in the first half of the year compared with the same period in the previous year, due to exceptionally hot weather.

Currently, soil moisture deficit is at the same levels seen in 2018, which could result in properties sinking because the soil is unstable. LV= GI analysis also indicates that southern and central England have had lower rainfall levels in 2022 than 2018.

Sarah Smith, head of home underwriting at LV= GI said: “We’re really starting to see the effects of climate change and the impact this is having on homes – whether that be storm, flood, fire or subsidence claims – which have all risen in recent years depending on the season.

“This summer we’ve really seen the effects of extreme heat, even from leaving items out in the garden which in usual conditions you wouldn’t expect to catch fire. As a country, we’re going to need to adapt and ensure existing houses are better protected, as well as really consider the locations planned for new houses which may be in areas more prone to events such as fires starting and spreading rapidly.”

Here are LV= GI’s tips to help prevent subsidence:

1. Prune trees and large shrubs to prevent soil from drying out. Seek professional advice from a tree specialist if you need to.

2. Check water pipes and guttering for leaks which can wash away or soften soil.

3. Lay porous materials around the home, such as gravel or grass, to allow water to drain naturally.

And here are its tips to help prevent outside fires:

1. Keep any reflective materials out of the sun if left in the garden.

2. Put away gas barbecue cylinders when not in use.

3. Manage compost heaps by turning regularly to ensure they do not become overly dry.

Insurance customers should still be proactive by haggling and potentially switching when their policy comes up for renewal, as they could be paying more than necessary despite a “loyalty penalty” ban having been introduced at the start of this year, according to Which?

The Financial Conduct Authority (FCA) put the ban in place after finding that millions of home and motor insurance customers were losing out by renewing repeatedly with their existing providers.

In January, the FCA implemented new rules which banned car and home insurers from offering different prices to equivalent new and renewing customers.

In a survey of more than 14,000 Which? members, the consumer group found that just over half (51%) of those with home insurance, and around four in 10 (43%) with car insurance, were paying a higher premium this year than they did last year.

The average increase among those seeing a rise was £35 for car insurance customers and £41 for home insurance customers.

Out of those customers paying more, half (50%) were renewing with their current car or home insurer.

Which? also found that those who haggled with their current provider or switched could still make significant savings.

When it came to haggling, a quarter (25%) of those surveyed discussed their price with their insurer this year, and of those who did, around half (48%) saw a reduction in their premiums – averaging £56 for car insurance and £54 for home insurance.

Those who instead decided to switch insurers also made significant savings. Car insurance customers who switched insurer were found to be paying £43 less, on average, than those renewing. Home insurance switchers were paying £103 less.

The research also compared premiums paid by customers in the first six months of this year, after the ban came into force, with premiums paid between May and December 2021.

For car insurance policies bought before the end of December 2021, people paid £360 on average. For cover bought between January and June this year, after the ban came in, the average annual price was slightly less, at £343.

Home insurance customers typically saw a fall from £332 to £329, over the same period.

But Which? said that most indicators suggest car insurance prices are now generally back on the rise.

This is largely because of increasing claims costs to insurers, caused by factors including increased used car prices and higher costs and delays in obtaining parts and materials for repairs.

Which? also pointed out that the new loyalty penalty rules still allow insurers to offer customers different prices depending on the “channel” used – for example, whether they go directly to the insurer or use a comparison site.

Insurance quote prices also change from day to day, so it is always worth doing some research before approaching an existing provider or considering making a switch in order to save money, the consumer group added.

Jenny Ross, Which? Money editor, said: “With household budgets under huge strain at the moment, it’s important not to renew your insurance without first checking if you could pay less.

“Our research shows it’s still the case that the price quoted by your insurer is not necessarily the best price you can get.

“Doing your research on comparison sites, haggling and switching remain effective ways of bringing down the cost of home and car insurance.”

A spokesperson for the Association of British Insurers (ABI) said: “The ABI supports these reforms, having asked the FCA to bring them in across the motor and home insurance markets. Insurers continue to work hard to make sure the transition to the new pricing reforms is as smooth as possible for customers.

“Like many other sectors, the industry is facing significant cost pressures – such as supply shortages, more expensive materials, and more costly repairs.

“Despite this, insurers are doing all they can to keep motor and home insurance as competitively priced as possible. This is highlighted by our latest motor and home insurance premium trackers, which show the average price paid for both motor and home insurance has fallen over the last year.”

An FCA spokesperson said: “Our reforms have put an end to loyal customers paying higher prices for their insurance.

“We will always encourage customers to shop around to find the best deal, and will continue to monitor the impact our changes have on the market.”

The most remarkable and unique feature of American politics is one that is rarely discussed: the Republican Party’s extreme anti-statist ideology. The Republican party is the only major conservative party in the world whose governing doctrine rejects higher taxes on absolute principle, refuses to acknowledge anthropogenic global warming , and denies that health insurance should be a right of all citizens. This last point surfaced during the second Republican presidential debate when Ron DeSantis was asked to explain why his state ranks near the national bottom in health insurance coverage. Because these moments occur so rarely, it was highly revealing.

The backdrop is that the Affordable Care Act provided health insurance to poor people by expanding Medicaid. A conservative Supreme Court ruling gave states the right to opt out of the expansion, turning down free funding from Washington if they wished. Originally, just 24 states joined Medicaid expansion. Over time, the sheer economic logic brought more states into the program. Turning down the money not only hurts people who can’t get health coverage, but it also hurts hospitals, which legally must treat people who show up in the emergency room, even if they lack coverage.

In other words, states were not choosing between spending money and hurting people. Helping people get insurance was practically free. (The federal government covers 90 percent of the cost, and the economic benefit of getting health care for the uninsured, both to covered workers and their health providers, easily exceeds the remaining 10 percent cost, paying for itself .) The states that refused to join Medicaid expansion literally had to accept economic sacrifices in order to pay for the privilege of denying health insurance to low-income citizens in their state.

Florida is now one of only ten states that reject Medicaid expansion. DeSantis almost never has to explain or justify this position. Shockingly, he had to do so at the debate.

Stuart Varney asked DeSantis why 2.5 million Floridians lack health insurance, which is a rate much higher than the national average. (Florida ranks fourth from the bottom in residents with health insurance). DeSantis first tried deflecting the problem to overall inflation:

DESANTIS: Well, I think this is a symptom of our overall economic decline. Everything has gotten more expensive. You see insurance rates going through the roof. People that are going to get groceries, I’ve spoken with a woman in Iowa. And she said, you know, for the first time in my life, I’m having to take things out of my grocery cart when I get to the checkout line …

This is obviously a total non sequitur. The uninsured rate in Florida did not get worse due to inflation. Indeed, it got temporarily much better because the Biden administration made emergency COVID-19 funds available to people in non-expansion states, like Florida. In any case, inflation is a national phenomenon that could not possibly explain why Florida ranks near the bottom in health insurance coverage.

Varney, amazingly, pointed this out. He asked DeSantis why Florida’s health insurance rate was “worse than the national average.”

“It’s not,” DeSantis replied. This was a pure lie. (Florida’s uninsured rate is in fact well above the national average, according to the Census Bureau ).

But then, DeSantis proceeded to give something like an explanation for his position:

“Our state’s a dynamic state. We’ve got a lot of folks that come. Of course, we’ve had a population boom.

We also don’t have a lot of welfare benefits, in Florida. We’re basically saying we want to — this is a field of dreams, you can do well in the state. But we’re not going to be like California and have massive numbers of people on government programs without work requirements. We believe in your work, and you got to do that. And so, that goes for all the welfare benefits.

And you know what that’s done, Stuart? Our unemployment rate is the lowest, amongst any big state. We have the highest GDP growth events (ph) of any big state. And even CNBC, no fan of mine, ranked Florida the No. 1 economy in America.”

In the middle of this word salad, some coherent thought can be extracted. Florida is a “field of dreams.” It rejects “welfare benefits.” DeSantis never uttered the word “Medicaid” or “Obamacare,” which explains why his state’s citizens lack health insurance at such high levels. Yet he did manage to express his belief that health insurance ought to be an earned benefit, not a right. If people get jobs working in construction or day care or at a convenience store, and those jobs do not have employer-provided health insurance, the state should not step in. Those people should work harder.

Indeed, to give them subsidized access to medical care will sap their incentive. Poor people need motivation to work hard, and denying them the ability to see a doctor and get medicine is part of that necessary motivation. And while Florida is now a minority among states refusing Medicaid expansion, DeSantis’s fanatical stance lies comfortably within the heart of conservative movement thinking. Indeed, this is what is considered “normal” conservatism.

The horrifying nature of this normality is generally invisible. It fell to Fox Business host Stuart Varney, of all people, to make DeSantis explain himself.