Hacker News Reader

Comment by Sevii | Hacker News Reader

There is so much data because of insurance. Insurers are in the business of declining claims. They have discovered that the best way to decline claims is to create byzantine rules while offloading all the work to comply with those rules to healthcare providers. The only way to fix it at this point is to nationalize the system or to exclude all routine care from the insurance system. Something like a legal ban on deductibles smaller than 20k/year would work.

View on HN

Per federal law (ACA), health insurers in the US are required to spend 80% to 85% of revenues on healthcare expenses. Their profit margins are 2% to 6%. Therefore, the higher the revenue, the higher the profit.

Where is the incentive to deny legitimate claims?

The incentive is probably to get their profit margin up to the maximum 15-20% https://www.propublica.org/article/cigna-pxdx-medical-health...

For sure, and that is where the government should be handing out heavy penalties. There supposedly is an appeals process, but obviously not enough auditing is being done:

https://www.healthcare.gov/appeal-insurance-company-decision...

Although, even with those fraudulent denials, Cigna's profit margins are suffering:

https://www.macrotrends.net/stocks/charts/CI/cigna-group/net...

Wonder if they went into too much debt to buy Express Scripts.

Is that real profit or profit after a bunch of accounting sleight of hand? Are they cutting their "profit" by taking heavy debt burdens via leveraged buyouts or other schemes, pulling way more than 20% off the top for their shareholders and then making it look like much less?

I trust the financial figures filed with 10-K reports and the US SEC enough to not worry about that. If one does not trust those figures (for multiple different companies employing tens of thousands of people each), then further conversation cannot be had.

> Where is the incentive to deny legitimate claims?

Because they want to be competitive and gain customers.

Which would you sign up for? Insurance that costs $800/month or $1200/month?

Competitive? In every job I've had it was basically the same 3-4 HMOs: Aetna, Bluecross, Cigna, and United Healthcare. If you are getting employer provided healthplans, as most Americans are, those are your options, 4. With so few options you aren't choosing the most competitive, you're choosing the lease worst.

Humana, Kaiser, Oscar.

But yes, there is an intense economy-of-scale that produces relatively few insurance companies.

(Maybe eventually only one.)

Oscar I've never heard of but appears to be only available in NY/NJ and is operated by Cigna in other states. Kaiser operates primarily in the west coast. And Humana doesn't have much presence in Florida. They primarily do Medicare Advantage, AFAICT.

Oscar is a new-age insurance startup, which is why people here may have heard it.

There are quite a few regional insurance companies. Like here in Utah a big name is Selecthealth, but no one else will have heard it.

National carriers are a safer/easier choice for employers who have a distributed workforce.

That is because the messed up pre-tax benefit the US gives to big businesses so they have (another) advantage over small businesses, so you are buying from whoever your employer chooses to let you buy from.

Ideally, everyone in the US would have to buy health insurance from healthcare.gov, and can choose whoever they want with zero input from their employer.

I would prefer to buy my health insurance on the open market. But without the subsidies its pretty uneconomical. The fact that your employer offering it automatically locks you out of the best plans on the marketplace is anticompetitive and anti-labour.

I have only ever had the chance to sign up for United Healthcare plans in my last 3 jobs

To be clear, I mean the employer not the employee as the customer deciding between competing providers.

Forget denying claims! Why did I pay 1200 to get my family tested for strep... After insurance?

In Switzerland, healthcare is somewhat private. The legal framework is enacted by law, and the Confederation decides the types of claims, prices, conditions, etc..

Every hospital (public or private) must follow the prices decided by the Confederation, and every health insurance must reimburse following the same prices, not more and not less.

And it works quite well I'd say

I wonder how you deal with the usual problems of price fixing. What services aren't done because they pay too little? How do you lure doctors into fields where the pay is terrible? What about rationing of procedures that are costly but pay too little - is the scheduling delay so long it impacts your health?

Reply on news.ycombinator.com