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{"id":593,"date":"2014-03-04T16:33:00","date_gmt":"2014-03-04T16:33:00","guid":{"rendered":"http:\/\/admin.patheos.com\/blogs\/janetheactuary\/2014\/03\/is-it-the-end-of-insurance-companies-as-we-know-it.html"},"modified":"2014-03-04T16:33:00","modified_gmt":"2014-03-04T16:33:00","slug":"is-it-the-end-of-insurance-companies-as-we-know-it","status":"publish","type":"post","link":"https:\/\/www.patheos.com\/blogs\/janetheactuary\/2014\/03\/is-it-the-end-of-insurance-companies-as-we-know-it.html","title":{"rendered":"Is it the end of insurance companies as we know it?"},"content":{"rendered":"\n<\/head>

That\u2019s what Zeke Emmanuel says, in an article in The New Republic<\/a>, which is itself a book excerpt. \u00a0In Emmanuel\u2019s world, the ACA is going to transform healthcare delivery and health insurance into a set of vertically-integrated healthcare providers. \u00a0I promised my son I\u2019d back crescent rolls with him (yeah, from a crescent roll tube), so I\u2019m not going to go into too many details, but he basically envisions all healthcare providers becoming the equivalent to Kaiser Permanente, that is, staff-model HMOs.<\/p>\n

Why would the ACA transform the health system, long after HMOs basically died? \u00a0Emmanuel doesn\u2019t really say. \u00a0In my \u201c VoucherCare<\/a>\u201d concept (yeah, I like to it periodically and don\u2019t get any takers) I thought these sorts of organizations would be more viable once the link to employer healthcare is severed, because an employer needs to please employees spread throughout a metro region, but a prospective staff-model HMO coming out of a sole hospital and affiliated doctors has a much more limited draw, and could better succeed if it could market to individuals. \u00a0Maybe Emmanuel presupposes the death of employer-sponsored healthcare, and this excerpt just doesn\u2019t get into that \u2014 after all, he himself proposed<\/a> a vouchercare system.<\/p>\n

But maybe he just envisions increasing mandates from the government to compel people to buy HMO policies, or carrots and sticks in future rounds of subsidies (get the silver plan-based subsidy if the plan you elect meets various criteria, or the bronze-level otherwise)?<\/p>\n

Anyway, I\u2019ve never entirely been clear on why HMOs failed. \u00a0Sure, the capitation model in which BCBS contracted with Independent Practice Associations \u2014 groups of doctors \u2014 was a bust because the IPAs really couldn\u2019t be their own mini-insurance companies. \u00a0And anytime you\u2019d visit your doctor, he\u2019d spend 5 minutes listening to you, and you\u2019d leave with referrals to a dozen specialists. \u00a0And there were hidden financial issues around fee agreements, and various lawsuits around exclusive networks. <\/p>\n

But I would have liked to have seen more Kaisers. \u00a0It seems viable \u2014 a large enough system that people don\u2019t face the problem of not being able to find a specialist. \u00a0And yet \u2014 there aren\u2019t more Kaisers. \u00a0I\u2019m not a healthcare actuary. \u00a0But there are reasons why there aren\u2019t more Kaisers, more large staff-model, employee-doctor systems out there. \u00a0What those reasons are I don\u2019t fully understand, and it would be great if there were real changes in the way healthcare works that will make more Kaisers viable in the future. \u00a0But Emmanuel sounds as if he thinks he can will more Kaisers into being.<\/p>\n

Oh, and, in addition, from what I understand, the concept behind the Kaiser system is great, but it doesn\u2019t actually produce better, cheaper, more efficient healthcare. \u00a0I read about this a while back and maybe I\u2019ll try to find the article again later. \u00a0But, of course, if Kaiser\u2019s premiums were exceptionally low, we\u2019d know it, and there would be dozens of systems trying to copy Kaiser already.<\/p>\n<\/body><\/html>\n","protected":false},"excerpt":{"rendered":"