These days, many companies in America are having battles in the boardroom, insurance brokers and company officials tell me. On one side of the table sits the chief financial officer (CFO), who would like nothing better than to drop the company health plan in 2014 and send employees to the newly formed health insurance exchanges. On the other side of the table sits the human resources manager, who argues that health insurance is so vital for hiring and retaining talented workers that it can't be eliminated. Imagine the headline or sound bite that says "IBM (or any other major company) ends employee health care plans." That's a public relations nightmare, according to the H.R. manager. Doing the math The CFO's argument is compelling when you do the math. The average company's health care plan costs about $10,000 per employee. In contrast, dropping the plan means having to pay a $2,000 penalty in accordance with the 2010 Patient Protection and Affordable Care Act. But dropping coverage and paying the penalty translates to roughly an $8,000 savings per employee, and about 40 percent savings to the company compared to what it now pays. The House Ways and Means Committee is now a… (continue reading......)
Ask medical malpractice insurance companies what they fear most and the answer will likely be "a 'jumbo' verdict.'" In insurance speak, a jumbo verdict often stems from a case where something went drastically and tragically wrong during a birth, and the child, mother or both suffered permanent injury. It's easy to see how this can happen: it can result from a breach birth, prolonged labor or the umbilical cord wrapped around the baby's neck. In many instances physicians deal with such complications by delivering the baby Cesarean -- making an incision in the uterus and removing the infant. In many cases, the problem is not the doctor's or hospital's fault. But it doesn't matter when a mother testifies to a jury about her brain-damaged child. Such victims are the most sympathetic plaintiffs a lawyer can represent, and are likely to garner a big monetary settlement no matter what type of defense the medical profession mounts. 'Long-tail claim' A child disabled at birth may need care for the rest of his or her life. Most states allow a minor to bring legal action against a hospital or doctor after the child reaches the age of maturity, says James O'Dell, senior vice… (continue reading......)
Once upon a time, children grew up and left home. Now, if they leave, they often come back. And even if they don't, for many reasons, they're still dependent on their parents. Thanks to the Patient Protection and Affordable Health Care Act -- portions of which were being hotly debated in the U.S. Supreme Court last week -- there's yet another reason for them to be tied to the nest. Insurers must offer parents the option of keeping their adult children covered under the parents' medical plan until age 26. Since the law went into effect last year, some 2.5 million young people have gained coverage, filling a huge health insurance gap. Traditionally, many health insurance plans dropped children from parental insurance plans when they turned 19 or graduated college. But a study by the Kaiser Family Foundation found that private health insurance coverage actually increased for those ages 19 to 25 between 2009 and 2010 - likely due to the law allowing them to stay on a parent's plan. For sure, there are clear advantages to having your adult child on your plan. "There's no underwriting, your employer contributes to the premium and you're more likely to get comprehensive… (continue reading......)
Doctors have been preaching for decades about the health risks of obesity. Now economists are weighing in, and the numbers are even scarier than the ones on your bathroom scale. A new study released by the Campaign to End Obesity warns of crippling expenses. "Our comprehensive review of the literature on this subject suggests that the more we look into the costs of obesity, the more daunting they appear," Michael O'Grady and James Capretta write in "Accessing the Economics of Obesity and Obesity Intervention." The study authors are no lighweights. O'Grady served as assistant secretary of the U.S. Department of Health and Human Services from 2003 to 2005, and Capretta was associate director of the U.S. Office of Management and Budget from 2001 to 2004. O'Grady and Capretta conclude that the usual 10-year time window that federal budget experts use to estimate costs and benefits of government programs is too short because the impacts of obesity take longer to manifest themselves. They recommend a 25-year forecasting window. Why should the federal government care if we're fat? Obesity is associated with development of chronic conditions, such as diabetes, heart disease and high blood pressure, and those conditions are expensive to treat.… (continue reading......)
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