Sunday, September 13, 2009

Is HHAP insurance?

I am extremely confused by the below CNN clip about the Healthy Howard Access Plan:

First of all, the CNN reporter refers to HHAP as "insurance", which is not what HHAP is.

Healthy Howard Access Plan is a new program designed to connect Howard County residents to affordable health care services and help our community overcome barriers to healthy living. The Plan is not insurance, but offers basic medical and preventive care to eligible residents who would otherwise not be able to afford or obtain health insurance.

Yet, the CNN clip describes a HHAP member who received triple bypass surgery for only $102. Additionally, during the budget process it was noted by council members that a $500,000 private grant to HHAP remained unspent, but Beilenson argued that the money was needed for "unexpected medical expenses". Having reserves of that magnitude on hand and providing triple bypass surgeries for $102 sure sounds like insurance to me.

Recall from early in 2008 that the Maryland Insurance Administration was questioning whether or not HHAP constituted insurance, but from what I understand HHAP is not subject to the same oversight as private insurance companies.

Ulman announced the plan in October 2007 and said at the time that it would begin offering care by July 1, 2008.

The delay stems from state insurance regulators' belief that Ulman's proposed Healthy Howard plan should be regulated as health insurance.

The Maryland Insurance Administration has yet to rule on whether the plan is insurance.

If it decides that it does constitute insurance, state law would require the nonprofit agency the county is using to administer the plan to have millions of dollars in reserve funds before offering the services.

The plan does not carry the same risk for cost overruns as health insurance plans, partly because the amount of services participants are eligible for is limited, Howard County Health Officer Peter Beilenson said.

However, rather than risk a court fight in which a loss would derail the plan, Ulman will seek state legislation to allow the nonprofit agency to offer the services without accruing the financial reserves, Beilenson said.

So far, Howard County taxpayers have put $1 million dollars into HHAP, HHAP has only enrolled somewhere around 300 people, and the plan has not published any audited statements or produced any other reports on its website. Add to this the murky area as to how HHAP is able to get away with not considering itself health insurance and therefore skirt the absurd government regulation that a private insurance company would have to endure.

Recall the boutique medical plan that Charter Internal Medicine wanted to start earlier this year was done in because the Maryland Insurance Administration threaded to cause problems.

What is going on here?


This .pdf document
may contain some answers. Basically, HHAP lets its members see a doctor 6 or 7 times a year, but if they need expensive surgeries like triple bypass, HHAP transfers those members to MHIP and pays the $4,500 MHIP deductible for the surgery. The transferred members then pay the monthly fees for MHIP, which are a whole lot more expense than the HHAP monthly fees.

Healthy Howard isn’t exactly health insurance, but a network of services that includes up to six primary care visits per year at the not-for-profit Chase Brexton Health Services clinic in Columbia, Md., and pro bono services from a bank of 200 specialists in 17 fields. With permission from a state regulatory commission, Howard County General Hospital has agreed to provide free hospitalization to members, forgoing the usual procedure under Maryland’s allpayer system of pursuing collection from uninsured patients. Johns Hopkins Hospital and the Maryland Shock Trauma Center have stepped up too, agreeing to see patients who need care unavailable at Howard County General. The program transfers members requiring very costly treatment to the more inclusive Maryland Health Insurance Program (MHIP) by paying down the required $4,500 deductible. Then they are left to pay the somewhat higher MHIP premium.

So, when you hear about HHAP members who seem to have received expensive surgeries for free or negligible costs, that is because those HHAP members were transferred to MHIP, and MHIP picked up most of the tab.


Anonymous said...

Excellant post.

But I would like to say, if you were the patient who received the bypass for $102.00, I don't think you would care what they called HHAP.

Maybe you could call it Happy, Healthy, Apreciatative, Patient, care.

Freemarket said...

Anon, I agree. And I would want as many people as possible to have access to it. So if it is favorable insurance regulations that benefit HHAP, perhaps the insurance regulators should back off of private companies as well.

The other alternative (possibly more likely) is that private insurance companies have adequate reserves and HHAP does not, which means it's only a matter of time and a few more expensive surgeries before HHAP is broke.

Anonymous said...

Would appreciate more posting of health care issues. Thanks

Anonymous said...

There is a link between the foundation grant, campaign contributions to Ulman, and who won the HHAP contract. The companies are under different names, but are all connected through ownership.

Anonymous said...

Another discussion on Healthcare:

Anonymous said...

What HHAP contract? There is no ownership of HHAP. It is a non-stock 501c3. In other words - a non-profit.