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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsInsurance Companies as We Know Them Are About to Die
Insurance Companies as We Know Them Are About to DieAnd here's what's going to replace them
BY EZEKIEL J. EMANUEL at the New Republic
http://www.newrepublic.com/article/116752/ezekiel-emanuel-book-excerpt-end-health-insurance-companies
"SNIP................................
Americans hate health insurance companies. They are easy targets for everyone to beat up on. When premiums go up, we blame insurance companies; we do not blame the underlying hospitals or physicians who charge high prices that drive up insurance costs. When people with cancer, heart attacks, or other diseases are denied insurance, we blame insurance companies; we do not blame the underlying voluntary insurance market that necessitates underwriting. When our wish for a new high-priced drug is denied, we blame insurance companies; we do not blame drug companies that set the price at over $100,000. Politicians can always elicit an applause by attacking the health insurance companies, reinforcing this bad-guy image of insurance companies.
This is not to say that insurance companies are angels, but they are also not the devil incarnate. A lot of what people consider to be their bad behavior is the inevitable result of the way the health care system is structured and how it incentivizes and forces certain behaviors.
The good news is you wont have insurance companies to kick around much longer. The system is changing. As a result, insurance companies as they are now will be going away. Indeed, they are already evolving. For the next few years insurance companies will both continue to provide services to employers and, increasingly, compete against each other in the health insurance exchanges. In that role they will put together networks of physicians and hospitals and other services and set a premium. But because of health care reform, new actors will force insurance companies to evolve or become extinct. The accountable care organizations (ACOs) (which I discuss in Chapter 8 of my new book) and hospital systems will begin competing directly in the exchanges and for exclusive contracts with employers. These new organizations are delivery systems with networks of physicians and hospitals that provide comprehensive care. This health delivery structure is in its infancy. Today there are hundreds of these organizations being created and gaining experience within government-sponsored programs or getting contracts from private insurers. They are developing and testing ways to coordinate, standardize, and provide care more efficiently and at consistently higher quality standards. Over the next decade many of these ACOs and hospital systems will succeed at integrating all the components of care and provide efficient, coordinated care. They will have the physician and hospital networks. They will have standardized, guideline-driven care plans for most major conditions and procedures to increase efficiency. They will have figured out how to harness their electronic medical records to better identify patients who will become sick and how to intervene early as well as how to care for the well-identified chronically ill so as to reduce costs.
The key skill these ACOs and hospital systems lackthe skill insurance companies specialize inis the actuarial capacity to predict and manage financial risk. But over the next decade this is something they will developor purchase. After all, actuarial science is not rocket science, even if it involves a lot of mathematical equations. And with that skill, ACOs and hospital systems will become integrated delivery systems like Kaiser or Group Health of Puget Sound. Then they will cut out the insurance company middle manand keep the insurance company profits for themselves. Therefore, increasingly these ACOs and hospital systems will transform themselves into integrated delivery systems, entering insurance exchanges and negotiating with employers, in direct competition with insurance companies.
..............................SNIP"
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Insurance Companies as We Know Them Are About to Die (Original Post)
applegrove
Mar 2014
OP
the health insurance companies are scraping 30% right off the top. cant go away fast enough.
Warren Stupidity
Mar 2014
#1
Warren Stupidity
(48,181 posts)1. the health insurance companies are scraping 30% right off the top. cant go away fast enough.
Oh and they provide zero healthcare.
And their basic goal is to deny their "clients" access to any healthcare.
yourout
(7,530 posts)2. +1......vampires sucking the life blood from our healthcare system.
applegrove
(118,682 posts)3. Obama should make Emanuel his chief of explaining healthcare. I saw him
being interviewed. He was great.
winter is coming
(11,785 posts)4. Will things actually be any better for consumers?
Sounds like hospital systems will merely become larger.
Scuba
(53,475 posts)5. The author is wrong on a number of points, including this one ...
This is not to say that insurance companies are angels, but they are also not the devil incarnate.
Yeah, they are. And I don't mean angels.
He lost all credibility when he wrote "the underlying hospitals or physicians who charge high prices that drive up insurance costs." This sentence illustrates that the author has no knowlege of how hospitals set prices.