Dollar to a donut and why should we Ohio public service retirees be thankful for an Attorney General from New York state?

From John Curry, November 7, 2009

I would be willing to bet a dollar to your donut that the majority of Ohio's public service retirees have no idea of how Medical Mutual, Aetna, and the other insurance companies, who contract with Ohio's retirement systems, set their "out-of-network" rates for the calculations relating to what out of network MD's charge (you know, the old "reasonable and customary" mantra) when you visit an out-of-network doctor. What Ohio's public retirement systems' contracted agents (the hc insurance companies) use to base their (in fact, all health insurance companies) reasonable and customary rates is a data base developed by a division of UnitedHealth called Ingenix. Their "supposed" out-of-network charges for medical procedures by MD's across this country involved "low-balling." Low-balling is a term used to describe a practice of deflating the actual out-of-network Md's charges in an attempt to allow your insurance plan to pay less of the bill for your-out-of network MD visit. Why? Well, if your insurance pays less, guess who gets to pay more? I'll leave you to ponder that one...while you are munching on your donut! While you're munching you might want to read the article below as taken from the Buffalo (NY) News re. Ingenix and the new system (almost in place) to replace the inflated Ingenix data. Enjoy your breakfast and be thankful for that AG from NY! His actions will help your wallet and the wallets of thousands of retirees who haven't the slightest idea what has transpired....and probably never will!

John

That system was created by a company called Ingenix, a subsidiary of United Health Group, itself a large insurer and, thus, a player in a massive conflict of interest. Following the attorney general’s investigation, United Health agreed to stop operating the database as soon as a new one could be created. The company acknowledged no wrongdoing. [You didn't expect them to, did you?]

In its place, Cuomo announced creation of a new Web site that will allow consumers to see what an insurer was likely to pay before they went to an out-of-network doctor. FAIR Health and the upstate universities will set up and operate the Web site and the new database upon which insurers will base their out-of-network reimbursement rates.

http://www.printthis.clickability.com/pt/cpt?action=cpt&title=A+reform+for+health+insurers&expire=&urlID=414233122&fb=Y&url=http%3A%2F%2Fwww.buffalonews.com%2F149%2Fstory%2F852155.html&partnerID=173606

A reform for health insurers

Attorney general’s transparency plan sheds light on out-of-network costs

The Buffalo News, November 6, 2009

Attorney General Andrew M. Cuomo last week unveiled his latest reform of an industry in need of supervision. This time, following his upending of the college loan scam, he has targeted health insurers.

Specifically, he has picked apart the false system by which insurers calculated out-of-system reimbursement rates and has announced the creation of a new nonprofit company. FAIR Health will work with Syracuse University and others, including the University at Buffalo, to operate a new database and consumer Web site that will bring transparency and credibility to a payment system that few could comprehend and no average user could challenge.

Cuomo announced this plan months ago following an investigation that showed health consumers were cheated out of hundreds of millions of dollars by an evaluation system that routinely deflated the so-called reasonable and customary costs charged in any particular region, thus reducing the amount an insurer had to pay.

That system was created by a company called Ingenix, a subsidiary of United Health Group, itself a large insurer and, thus, a player in a massive conflict of interest. Following the attorney general’s investigation, United Health agreed to stop operating the database as soon as a new one could be created. The company acknowledged no wrongdoing.

In its place, Cuomo announced creation of a new Web site that will allow consumers to see what an insurer was likely to pay before they went to an out-of-network doctor. FAIR Health and the upstate universities will set up and operate the Web site and the new database upon which insurers will base their out-of-network reimbursement rates. The system is expected to be functioning within a year.

Cuomo has made a name for himself by training his sights on broken and even corrupt systems that are largely invisible to most people, but which take money out of their pockets. Not long after taking office in 2007, he discovered that many colleges were colluding with lenders, benefiting both those parties at the expense of students. He forced the creation of a new system.

That’s what is occurring here. The attorney general’s work will help lower the costs of out-of-network care. At the same time, it shows why so many people favor a public option in health reform. More competition is needed to wring this kind of gamesmanship out of the system.