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Monday, September 21, 2009

Letter to Senator Baucus on Health Reform - a "pro" view that makes sense

I generally have a more conservative view than my brother, however on the issue of Health reform, we have transcended politics to see a common point of view.

I trust the rest of the country can begin to transcend politicization and emotionalism, deal with the facts, and fix the problem.

Here is his letter:

Clinical Neuropsychology * Cognitive Rehabilitation
Supervised by Richard L. Fulbright, Ph.D.
Elizabeth A. Thompson, M.S., L.P.A.
Candace M. Genest, Ph.D.
Case Management
Jody L. Fulbright, M.S., L.P.C.

Clinical Neuropsychology
Richard L. Fulbright, Ph.D.
Mary C. Anise, Psy.D.
6210 Campbell Rd., Suite 100, Dallas, Texas 75248-1371
Tel: 972/250-1705 Fax: 972/250-1710
E-mail: Website:

September 20, 2009

Dear Congressman/Senator:

As a healthcare provider, a small-business owner, and an employer who provides healthcare benefits to my employees and my family, I am most concerned about the provision in the Baucus bill that would tax insurance premiums. This is unfair and inappropriate, punishing the wrong party.

I hope that you do not let the length of this letter deter from reading it. This is not simply political palaver, but a very detailed explanation of real-life concerns of myself and many small business owners.

My issues are categorized as follows:

  • Please amend healthcare premium taxes in the Baucus bill

  • Understand how premiums are set and are out of the purchaser's control

  • Normal coverage is not a “Cadillac plan”

  • Why choosing a cheaper plan is not an option in the current system

  • Real costs of insurance coverage to a small business owner

  • Why I am in favor of a public option health care plan

I am a clinical neuropsychologist, an employer of four people, and provider for Medicare and managed care insurance services. When you talk about the small business owner struggling to provide health care benefits to his employees, I am that guy. I make a modest income, work about 75 hours a week, provide a valuable service to the public, and participate in government-funded health care plans, such as Medicare, state-funded vocational plans, and the VA (through an outside provider contract). I feel that I have an "on the ground" perspective of the small business owner that is so frequently discussed in Washington as a straw man for demagoguery. I would like to tell you about what it's like to be the real man in that position.

Maybe I am atypical in that I feel that I have a responsibility toward my employees to provide them a respectful work environment, appropriate pay, and 75% subsidy of their healthcare insurance benefits (I pay 75% of the premium, plus some contributions to the HSA deductible). Below, I'll discuss my perspective on dealing with healthcare benefits from the standpoint of the small businessman, the healthcare provider, and the family breadwinner.

Premium Rates: The insurance carriers set the premium rates based on age, pre-existing conditions, current conditions, prior year usage, and the size of the business. Political pressure made them discontinue gender-based rate setting on childbearing age women. Finally, rates vary from state to state, based on state insurance boards' regulation of insurance carriers. Businesses with fewer than 50 employees are charged much higher insurance premiums per person than bigger businesses, when in reality, we could all be pooled into one small business group. Neither the insurance industry nor the state government has fixed this problem, no matter how much the legislators voiced sympathy for the small-business owner. Given all these factors, how can the Baucus bill set a limit on nontaxable premiums when the people being taxed have no control over the premiums the company charges them?

Since I currently provide coverage for six people under my plan (3 employees and 2 dependents), we are highly vulnerable to rate increases due to illnesses or conditions of even one person. A complicated pregnancy can radically increase our rates. Given that psychology has become much more feminized, (all but one employee is female), our rates could go up dramatically (and have) because of a complicated pregnancy. If you think that I could find a cheaper carrier, I would be open to this. However, I have several medical conditions (and my son has a serious one), and we would certainly not be insurable by another carrier, so shopping for another policy would not be an option for me. Once again, the policymakers need to wake up to the realities of life in the field. Are you aware of these conundrums that your constituents face?

Cadillac or Lemon? It is extremely arrogant for a congressman (with excellent government-funded benefits) to call my private healthcare plan, for which I make considerable sacrifices for my family and my employees, a "Cadillac plan", since the actual coverage is more like a Dodge Dart than a Cadillac. I have never seen an insurance plan that would cover my family of four with reasonable services for less than $22,000. Given any increases that occur in my premiums (which are out of my control), I would be taxed for my insurance coverage, which is already prohibitive. When I review my annual insurance plan options, I don't see any plans that would reliably fall under this $24,000 rate. I currently pay around $23,700 per year. The insurance carrier can increase my rates by 27% on any given year up to the maximum rates allowable by law. Let's assume that the insurance carrier increases my rates a modest 10% for next year. My family's coverage will then go to $26,000 per year. I would then be taxed 35%, which would raise my family premium alone to $35,100 per year! The cost of my premiums for my employees would be $59,940, resulting in a $20,000 "Cadillac tax" for the government. Why not tax the insurance carrier for the exorbitant profits they make? Or better yet, just raise income taxes, since we are all paying for public health care through school and property taxes to county facilities. No one ever mentions that the cost of indigent care is paid for through county and hospital district taxes, to which I contribute about $7000 or $8000 a year.

The Real-World Small Business Perspective (Not Joe the Plumber): In terms of our insurance plan being a "Cadillac plan," you should know that we currently pay $39,956 per year in premiums to cover six people. This is with a high deductible ($3000 per person), so that we can afford monthly premiums. We have an HSA plan, consistent with the Republican agenda that Americans enter the healthcare marketplace with their own dollars. What this really means is that we have a $3000 deductible, to which I contribute an additional $1200 to my employees to ensure that they have only an $1800 deductible. You should know that most of my employees never get to use their insurance, since they do not work through their deductible to access benefits. That means the insurance carrier makes 100% profit on the premiums we pay them on most of my employees, and they certainly end up spending a lot less on health care than they receive in premiums. In essence, I am paying $7200 per employee with my contribution to their HSA. As a family, we have a $6000 deductible, meaning that I have to spend $6000 in health-care before any of my family's routine medical care is reimbursed by the carrier. If I were the stereotypical rich doctor, I guess I would have $6000 readily available for healthcare. As it is, we've had to borrow from family and use credit cards and savings to get through the deductible each year. As I have always said, if we practiced psychology the way they practice insurance, we would have had our licenses stripped and spent time in jail.

Re: Buying a Cheaper Plan: Even if we were insurable under another plan, there are significant limitations in cheaper plans. Cheaper plans give me a very limited choice over my doctors. They also limit mental health care coverage in terms of the numbers of sessions and reimbursement percentage to the provider (most pay 50% to in-plan providers, which are very limited). My son has a complicated set of conditions that require considerable care and extremely expensive medication. The expensive medication is a whole other story (we can buy it yet from Canada for $100 per month or buy it through our insurance carrier for $5000 per month due to some crazy pricing scheme). More on this later. As a psychologist, I will not buy a plan that excludes mental health care from its coverage. Doing so would be synonymous with a congressman voting for a bill that would cause their constituents to vote them out of office (When is the last time you fell on your political sword and took one for the team?). Why should I pay nearly $40,000 a year for an insurance plan that fails to serve my needs and is aimed at putting people like me out of business? When I hear concerns that President Obama's plans have provided little details, I can only think of all of these details I am discussing that fail to be mentioned in the Republican-backed private healthcare reform option. None of these details have been specified as target areas to be reformed. I hear a lot more about keeping the current system in place, meaning ongoing profits for the insurance companies and deteriorating health care delivery for our country. This concerns me a lot.

The Real Cost of Health Care: I am sickened when I hear self-righteous statements from politicians about the need to protect suffering small businesses. To date, neither the state-regulated insurance industry nor state legislators have made any headway in easing the healthcare expense burden of the small businessman. And to think that they blame the doctors. The state-regulated lack of insurance reform has caused extreme duress in my small business. We have adapted. It’s the insurance industry’s turn.
  • "Predatory Pricing" heyday with predatory pricing on businesses with fewer than 50 Employees, which make up the majority of enterprises in the United States. In addition, healthcare providers tend to be older and increasingly feminine, particularly among the professionals.

  • "Administrative Costs" Justify Higher Premiums: Another opportunity for the carrier to increase rates to the maximum allowed by law. Small businesses pay the highest premiums for insurance per person, purportedly due to "administrative costs". It seems that Medicare doesn't incur any unusual expenses by having millions of individual insureds.

  • Shifting the Burden to the Taxpayer: Many small businesses don't provide any healthcare benefits to their employees, which means that the boss is making more money and hiring lower quality employees who are willing to take jobs without benefits. When these people need medical care, they go to hospital emergency rooms. If they are publicly funded, we taxpayers pay exorbitant emergency room rates for routine medical care, a totally remediable problem. If no one gets paid, hospitals raise their rates to sources who do pay, meaning insurance carriers. Why do you think that an aspirin cost five dollars in the hospital? This is called cost-sharing, meaning somebody has to pay the light bill and the staff in order to provide services. You rob from Peter to pay Paul. In short, we are already paying for public health care through a very disorganized, exorbitantly costly, and poor quality system by which services are provided to the uninsured without direct reimbursement. As healthcare providers, we all do it. Ethically, we can't or shouldn't stop it. Without higher dollar private work, I couldn't afford to see patients paying with insurance and state funds. That's why many mental-health professionals quit taking insurance altogether. Instead, we pay through higher insurance premiums, higher deductibles, higher hospital costs, and county taxes (that's what the hospital district taxes on your property taxes are for).

  • Dollars and Sense Versus Nickels and Dimes: If a public health option would cost the average American household $1500 a year in taxes, that would be a net cost savings, especially if this resulted in a decrease in hospital district taxes and shifted the burden directly to a system made to care for a range of health care needs rather than expensive emergency room settings. It's a lot cheaper to operate a public primary care clinic than an emergency room. When 35% of uninsured Texans are relying on the system of care, we are burdening our taxpayers significantly. You don't see these taxes referred to as "healthcare taxes" due to good packaging by legislators. It's a loaded issue, and no legislator who wants to be re-elected will bring it up. Ron Anderson, M.D., director of Parkland Memorial Hospital for the past 30 years, has been saying exactly this for many years, largely to deaf ears. I think he knows of what he speaks.

  • A Real-Life Example: (This is a true story). A 20-year-old uninsured male with limited finances develops an abscessed tooth and has no money to pay for a dentist to treat it. The infection goes to his bloodstream and causes bacteria to form on his heart valve. This throws him into an acute cardiac crisis and causes him to have anoxia due to cardiac arrest and several strokes, causing him brain damage. He underwent a heart valve replacement surgery. He had residual deficits in his cognitive, physical, and behavioral functioning. He underwent inpatient rehabilitation and was discharged as soon as possible. Overall cost of the hospitalization probably ranged to around $50-$60,000, plus another $30,000 in inpatient and outpatient rehabilitation costs. Taxpayers in the East Texas County where he was treated funded the entire hospitalization. Ironic lesson: if this man had access to dental care, he would have had his tooth treated, and we would have saved about $90,000. Multiply this case times 10,000 or more each year, and you begin to see what types of massive medical expenses simple and timely primary care could prevent or reduce. 10,000 of these cases would give us $90 million back in preventable health care expenses. And why is the cost of healthcare increasing, and why is utilization of healthcare services increasing? It's not just greedy doctors. They are plenty busy. It's a broken system.

  • System Paradigm Flaws: What If We Treated Cars and Armies like This? Providing primary care in the emergency department is like taking a flat tire to the Ford dealer to be fixed. Firestone replaces your tire a lot cheaper, since that's what it's designed to do. The dealer will charge you not only for the tire, but pretty building, the high overhead, and the high-priced mechanic who is costing you $40 an hour to change a tire. You can either feel that it is ideologically wrong to take your Ford to Firestone and then pay $150 for a tire change, or you can go to Firestone and pay $80 for the same thing. If we're talking ideology, one has a right to be a Ford purist. If we’re talking logical and economical use of tire changing resources, go to the place that does it fast and cheap and save the Ford dealership for Ford-specific work. Same thing goes in healthcare.
Likewise, imagine the American military being made up of thousands of private military corporations that theoretically report to state regulatory boards and theoretically follow orders from the Pentagon. Imagine that these companies are primarily responsible only to the state in which they are regulated, and only secondarily responsible to the Pentagon. Also imagine that the individual corporations profit by spending less on the safety of their men and maximizing revenues from the government, who pays them to serve. And, oh yeah, the heads of these corporations make a significant profit. Can you imagine what it would be like for this ragtag bunch to go to war? Welcome to the current healthcare insurance system. This is no hyperbolic analogy. It is dead on to the way it actually works. Sound crazy, like a Balkanized country on bad moonshine? It is.

What Has To Happen: I have always felt that we need a hybridized system of healthcare insurance in the United States. This is why I voted for Obama rather than Hillary Clinton. Obama's plan involves taking the current healthcare system and imposing more standardized set of rules and regulations on the carriers set by the federal government. This would ensure inclusive coverage, portable coverage, and some standardization of minimum reimbursement rates and utilization review (what care gets approved). This doesn't destroy the current healthcare system but adds some order and security to it. A public health care option is not only cost-efficient but leads toward cost-containment of the insurance industry. A public option will not limit care but will in fact increase care and reduce costs through lower point-of-service costs (i.e., not the ER) and better healthcare maintenance to prevent more costly conditions. This will work. It works in other countries. It will work here.

Why I Am in Favor of the Public Option Healthcare Reform Plan: I am all for health reform for many reasons. First of all, people need health care, and it is morally right to do so. Secondly, an organized health care plan will ultimately save this country significant money and improve the quality of life. Ideology has no place in this argument. This argument should be carried out on the basis of practical problem-solving, not ideology or fealty to the insurance industry which, as we all know, spends more on lobbying than any other profession in the United States. I can see how they have influence with Congress.

In America, lack of healthcare coverage and unfair insured selection rules imposed by the insurance carriers (and allowed by the state) are all wrong. Also, insurance carriers' claim that healthcare costs are rising baffles me, since I do not know any healthcare provider who is making more money today than they were 10 years ago. Can you say that for any other profession? Congressmen, Senators, attorneys, and certainly insurance executives are making more money than they were in 1999, as is appropriate given their professions, the value of their work, and increased costs of living. Most individuals make more money as they progress in their profession.

In the healthcare field, providers' incomes have been very flat or declining. I receive the same amount of money for a full-day neuropsychological evaluation now as I did 17 years ago. Of course, my cost of providing services has not stayed in line with the reimbursement I receive. It's clear that the increasing cost of health care to insurance carriers has primarily been through increasing hospital and pharmaceutical costs, not direct provider services. In addition, hospitals have to charge a lot for their services, since a large percent of them are not reimbursed due to providing humanitarian care in their emergency departments and other departments to uninsured people that cannot or will not pay. Also, they lose money to insure people whose actual insurance will not pay for necessary expenses. Or, they eat up many man hours trying to get an insurance company to pay for authorized services that they subsequently refused to pay. That adds a lot to your health care bill and seriously cuts down the amount of time your doctor spends with you.

I believe that I serve my country by providing services to Medicare, state vocational services, and the VA at a substantial discount to my normal rates. Many doctors do not provide services to these populations, particularly those in private practice. In fact, our local state-funded medical school does not take workers compensation payment. Neither do about 90% of the doctors in Dallas County. Can you imagine the outcry that would follow if UT Southwestern Medical Center suddenly refused to accept Medicare? Most of their multimillion-dollar benefactors would not be able to get Medicare coverage for the care they receive at this world-class medical institution. Yet they are the ones who cry about government takeover of health care. Again, let me redirect your attention to the average person trying to live within the system as it is.

By the way, Medicare, state vocational services, and the VA are "big government, single-payer" plans that are my favorite to work with, since they require a minimum hassle, appreciate our work, and provide a modest paycheck without insurance games. You never hear Texas politicians complaining about the Department of Assistive and Rehabilitative Services as a drain on the state budget. They actually put taxpayers back to work purely with public funding to providers like me who do the work. Good Medicare providers keep people out of the hospital. Doctors in these systems typically provide outstanding care for their clients, and their providers are typically very happy with them. These systems provide the service with a far lower overhead than do managed care companies (about 3% Medicare versus 27% managed care for the same thing). What's wrong with that? If that's socialism, count me in. If this is reasonable healthcare policy, don't call it socialism to scare people away.

Conclusion: I can only urge you to support a government option and to amend this part of the Baucus bill which is sorely out of touch with reality (the provision, not the bill). Maybe policymakers have been in Washington for too long to understand the real-life plight of the vaunted small businessman on which many stump speeches are made. I suggest that you listen to some of us who are actually supporting this economy by keeping people employed and find out what it's really like trying to provide healthcare benefits to our employees. It's pretty ironic that as healthcare providers, we can't really get our own care, especially mental health care, which given the state of affairs, we could all use!

So, to Summarize:
  • I'm doing all the right things by 1) contributing to our health care system as a low-cost provider, 2) containing my costs to the system as a provider, 3) employing four taxpayers, and 4) providing health care benefits and a 40% HSA deduction relief bonus to my employees.

  • We don't have a Cadillac plan, just one that covers the normal needs of a middle-class American family. Maybe we should compare our plans with the current government plan to see who really has a Cadillac and who has a Dodge.

  • Insurance carriers raise the cost of premiums annually based on age, pre-existing conditions, current conditions, previous year utilization, the amount of increase allowed by the state, and the size of the business. We consumers have no control over insurance rates, and many insureds cannot change plans due to medical conditions that arise with normal life.

  • 50% of my employees never reach their deductible, meaning the insurance carrier makes about $6000 annual profit per employee at a cost of $7200 to me. Some Cadillac. Sounds like a lemon to me.

  • The Baucus plan's provision to tax premiums over $24,000 per family is absolutely the most illogical response to the healthcare crisis imaginable. Adoption of this provision would essentially obligate me to drop coverage for my employees in order to cover myself. Isn't it going against the grain of increasing health care coverage to Americans? If you punish the insureds, what incentive do the insurance carriers have to lower their rates? A little logic please…

  • Interstate purchasing will never work due to a state-regulated insurance industry. This would result in absolute chaos and countless reasons for insurance carriers not to pay providers or reimburse insureds.

  • Current government-funded plans (state vocational services, Medicare, VA) provide excellent services, minimum hassle to the provider, and low, but no-hassle reimbursement. The congressional plan of the United States Congress is a government-funded plan.

My final statement is a well reasoned request that you support healthcare reform plans containing the public option.


Richard L. Fulbright, Ph.D.
Clinical Neuropsychologist
Plano, Texas
214/212-0059 (mobile)
972/398-6891 (home)
972/250-1705 (office)

Sunday, September 20, 2009

Views on Health Reform and other kinds of Insurance

After reviewing some blogs on liberal as well as conservative points of view on Health care reform, I just noticed something.... there are some important points NOT being focused on as well:

A fair debate between liberals and conservatives about the nature and needs of health care reform is a healthy and good thing. But what about life insurance? Should that be free, or without consideration for health conditions (cancer, aids, high blood pressure, diabetes, chronic and terminal issues), parachuting out of an airplane, racing motorcycles? Will the baby (life insurance) be thrown out with the bathwater on this whole health care issue, or will it remain the same?

The nature of our health care has been insidiously controlled by the limitations placed upon it by its providers (AMA), the doctors trying to stay in practice, drug manufacturers, lobbyists, politicians, the insurance companies seeking to make a profit, and lastly the federal government.

All this compounded by the onset of frivolous lawsuits starting in the 70's, and the equally ridiculous settlements provided, were the first cause of malpractice rates to rise and begin a forced upward spiral of cost. It got so bad back then, that the State of Texas had to create a pool from which Doctors could buy basic liability limits so they could buy umbrellas of higher levels to stay in practice. The villans here are not so much the insurance companies (while they have their share of blame now) but the Ambulance Chasing attorneys seeking their fortune in 30% in fees from won settlements and class action suits (Jefferson County, Texas is known for being the home of the highest settlements ever returned in history). Tort Reform should equally be the focus, as well as some (some, I said) health reform.

This issue is a very complex and thorny one. Not to be settled by emotional politics run from one party or another, rather by careful and objective analysis. Many European countries have government run or subsidized health care that works hand in hand with private insurors who have to live with the rules of the road.

I have had to live with and without health care, and have also been at the effect of a public option while unemployed that forced me to pay for everything. So, while I have a good job with good insurance, I am satisfied with it. For those without, there should not be such regulatory barriers. The one thing that is for sure, the abuse of this system needs to stop. Everyone seems to be "gaming" everyone else, and that is one of the biggest issues.

Ok. I'll stop now.