Re: Protocols for Insurance to Maintain Privacy

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Tim May wrote:
> The FDA has probably killed more people in the last 30 years than
> all the wars the U.S. has been in during the same time. Mostly
> because of the game-theoretic nature of the system: all that matters
> to FDA officials is covering their ass so that promotion is
> ensured. No points for approving a controversial drug, but lots of
> demerits for approving a drug which hurts even one person (if the
> media reports it as "another FDA oversight").  Avoiding flipper
> children is the raison d'etre for these people.

Tim no doubt already knows this, but I'm going to mention it anyway.
The FDA has other reasons for existing such as protecting the major
drug cartels from competition and providing wonderful employment
opportunities for former FDA employees in said drug cartels.

The choice of medical products and services as a choke point to
exploit is a particularly evil one as the link between government
imposed oligopoly profits and people's lives is very clear.

And, of course, this is worst of all for poor people because they are
least able to manage their situation.

I have my doubts as to whether it is possible to set up a really good
anonymous insurance scheme.  At some point the customer must
physically be matched up with the policy.  The damage may be minimized
by putting a hash of the customer's DNA markers in the policy instead
of the markers themselves.  But, when the customer wishes to draw on
the policy, his or her markers will have to be taken.

If there were a way for the representative of the insurance company to
absolutely verify the DNA markers such that the customer could be
absolutely certain the information didn't leave the room, a really
good anonymous policy would be feasible.  But, I can't think of a way
to do this.

The really good way to protect your medical privacy is to self insure.
Most people are happy with policies that tap out at $1 million.  If
you would be happy with such a policy, then all you need is $1 million
to protect your privacy.  It is likely that this $1 million will not
ever be consumed by health care costs.  (Probably much less likely
than that a policy holder will hit that limit.  People tend to spend
their own money more responsibly than somebody else's.)

One of the most important criteria for issuing insurance must be age.
Is there anyway to unambiguously determine somebody's age?  I know how
to do it with trees, but it doesn't work with people.

Monty Cantsin
Editor in Chief
Smile Magazine
http://www.neoism.org/squares/smile_index.html
http://www.neoism.org/squares/cantsin_10.htm

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At 8:50 AM -0700 10/30/97, Secret Squirrel wrote:

>The really good way to protect your medical privacy is to self insure.
>Most people are happy with policies that tap out at $1 million.  If
>you would be happy with such a policy, then all you need is $1 million
>to protect your privacy.  It is likely that this $1 million will not
>ever be consumed by health care costs.  (Probably much less likely
>than that a policy holder will hit that limit.  People tend to spend
>their own money more responsibly than somebody else's.)

I used to think this was so, too. But there's a certain kind of market
failure at work. (Actually, it's not a market failure at all....it's a
manifestation of the market. Read on.)

It turns out that if I have to go to the local hospital, the daily rate for
a hotel room will be something like $2000 a day. Exclusive of whatever
treatments I'm receiving, of course.

Turns out that Blue Cross and Blue Shield have negotiated, through enormous
buying power, daily rates of about $700 a day. (These numbers come from my
memory of a "60 Minutes" report a few years ago. Details and current
figures may vary.)

Listed prices are the "sucker rates," kind of like the posted prices for
out-of-towners, with locals getting a discount. And these pricing
differences apply to the whole range of procedures. For example, an
insurance company might have negotiated--over many years of intense
negotiations--a fee of $100,000 for a liver transplant, but a "cash-paying
customer" (a victim, a mark, a sucker) would pay the list price, e.g.,
$300,000.

Could I negotiate a lower room rate, and lower fees for a spectrum of
possibly needed treatments? Probably. I haven't had to try, fortunately.
(Nor am I knowledgeable about procedures. Nor am I patient negotiator, no
pun intended.)

I'm not calling for market intervention, price regulation, government
intervention, etc.

Just noting that cash is not always king. Especially to any medium-sized or
larger hospital, where filling out the forms correctly is more important
than getting paid in cash. (My dentist's receptionist is befuddled by my
paying in cash. She clearly prefers to just enter the number of an
insurance company.)

Walking in off the street, or arriving in an ambulance, without an
insurance policy number is becoming a guarantee that one will pay the
absolute maximum rate, the "sucker rate." If one is admitted at all, as
many hospitals turn away anyone without a means of proving they can
pay....and promises are not enough.  And if one proves to the hospital that
one has large resources, I fear for the consequences ("wallet extractions"
being one  risk).

I have so far elected to self-insure, i.e., to just pay any medical bills I
might have out of pocket. However, given this "sucker rate" and the
increasing unwillingness of hospitals to take patients not in health care
or insurance programs, I may have little choice but to sign up.

--Tim May

The Feds have shown their hand: they want a ban on domestic cryptography
---------:---------:---------:---------:---------:---------:---------:----
Timothy C. May              | Crypto Anarchy: encryption, digital money,
ComSec 3DES:   408-728-0152 | anonymous networks, digital pseudonyms, zero
W.A.S.T.E.: Corralitos, CA  | knowledge, reputations, information markets,
Higher Power: 2^2,976,221   | black markets, collapse of governments.
"National borders aren't even speed bumps on the information superhighway."

On Thu, 30 Oct 1997, Tim May wrote:

> At 8:50 AM -0700 10/30/97, Secret Squirrel wrote:
> 
> >The really good way to protect your medical privacy is to self insure.
> >Most people are happy with policies that tap out at $1 million.  If
> >you would be happy with such a policy, then all you need is $1 million
> >to protect your privacy.  It is likely that this $1 million will not
> >ever be consumed by health care costs.  (Probably much less likely
> >than that a policy holder will hit that limit.  People tend to spend
> >their own money more responsibly than somebody else's.)
> 
> I used to think this was so, too. But there's a certain kind of market
> failure at work. (Actually, it's not a market failure at all....it's a
> manifestation of the market. Read on.)
> 
> It turns out that if I have to go to the local hospital, the daily rate for
> a hotel room will be something like $2000 a day. Exclusive of whatever
> treatments I'm receiving, of course.
> 
> Turns out that Blue Cross and Blue Shield have negotiated, through enormous
> buying power, daily rates of about $700 a day. (These numbers come from my
> memory of a "60 Minutes" report a few years ago. Details and current
> figures may vary.)
> 
> Listed prices are the "sucker rates," kind of like the posted prices for
> out-of-towners, with locals getting a discount. And these pricing
> differences apply to the whole range of procedures. For example, an
> insurance company might have negotiated--over many years of intense
> negotiations--a fee of $100,000 for a liver transplant, but a "cash-paying
> customer" (a victim, a mark, a sucker) would pay the list price, e.g.,
> $300,000.

Actually, the real "sucker rates" are the amounts small businesses pay for
insurance.

The big businesses (who can buy in bulk) get a pretty reasonable deal for
what they get.  The smaller companies who cannot bargain the price down
get screwed.  (The rate my wife's employer was paying was close to double
what my insurance costs and it covered ALOT less.)

I seriously doubt that most people could afford to self-insure at the
going rate.  (Not unless they have some serious income they want to get
rid of.)

alan@ctrl-alt-del.com | Note to AOL users: for a quick shortcut to reply
Alan Olsen            | to my mail, just hit the ctrl, alt and del keys.

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At 08:11 PM 10/30/97 -0500, Dave Emery wrote:
>On Thu, Oct 30, 1997 at 09:33:52AM -0700, Tim May wrote:
>
>> Turns out that Blue Cross and Blue Shield have negotiated, through 
enormous
>> buying power, daily rates of about $700 a day. (These numbers come from my
>> memory of a "60 Minutes" report a few years ago. Details and current
>> figures may vary.)
>> 
>	My wife is a pathologist, and she tells me that some of the more
>aggressive HMOs get away with paying 15-20% of the posted "official" prices
>for procedures and tests.    The difference between what insurance
>organizations pay and the nominal price is usually 2 to 3 to 1 for most
>things these days.   And for many years Medicare has set defined prices
>for medical reimbursement that less than the gold plated bill amount
>as well.

The WSJ had an article about a guy who found out that his HMO had negotiated 
a payment rate which was less than his *copay* on the procedure so the 
insurance company paid nothing for his hospitalization at all.

DCF
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On Thu, Oct 30, 1997 at 09:33:52AM -0700, Tim May wrote:

> Turns out that Blue Cross and Blue Shield have negotiated, through enormous
> buying power, daily rates of about $700 a day. (These numbers come from my
> memory of a "60 Minutes" report a few years ago. Details and current
> figures may vary.)
> 
	My wife is a pathologist, and she tells me that some of the more
aggressive HMOs get away with paying 15-20% of the posted "official" prices
for procedures and tests.    The difference between what insurance
organizations pay and the nominal price is usually 2 to 3 to 1 for most
things these days.   And for many years Medicare has set defined prices
for medical reimbursement that less than the gold plated bill amount
as well.


-- 
	Dave Emery N1PRE,  die@die.com  DIE Consulting, Weston, Mass. 
PGP fingerprint = 2047/4D7B08D1 DE 6E E1 CC 1F 1D 96 E2  5D 27 BD B0 24 88 C3 18

>I have so far elected to self-insure, i.e., to just pay any medical bills I
>might have out of pocket. However, given this "sucker rate" and the
>increasing unwillingness of hospitals to take patients not in health care
>or insurance programs, I may have little choice but to sign up.

Why not establish an offshore insurance company (e.g., in the Caribbean so
the area code doesn't make it appear outside our boarders) which knows you
true ID, but let's you use a pre-agreed upon pseudo-ID.  They could even
have URLs on their pages to services which could help you out obtaining
realistic hardcopy.

Doctors don't much care as long as they are getting paid and all will
accept out-of-state, many even knowingly out-of-the-country, insurers.
They really don't care about the IDs as long as they match something
insurance company says they'll pay.

--Steve

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At 09:33 AM 10/30/97 -0700, Tim May wrote:

>Listed prices are the "sucker rates," kind of like the posted prices for
>out-of-towners, with locals getting a discount. And these pricing
>differences apply to the whole range of procedures. For example, an
>insurance company might have negotiated--over many years of intense
>negotiations--a fee of $100,000 for a liver transplant, but a "cash-paying
>customer" (a victim, a mark, a sucker) would pay the list price, e.g.,
>$300,000.
>
>Could I negotiate a lower room rate, and lower fees for a spectrum of
>possibly needed treatments? Probably. I haven't had to try, fortunately.
>(Nor am I knowledgeable about procedures. Nor am I patient negotiator, no
>pun intended.)

You can negotiate in advance.  Many doctors will cut their rates for surgery 
if you tell them you are uninsured.  We actually called around to a number of 
hospitals recently to see if they would discount a birth for cash up front 
and we were able to find hospitals willing to cut their rates.  A 50% cut 
seems the standard range.

>Just noting that cash is not always king. Especially to any medium-sized or
>larger hospital, where filling out the forms correctly is more important
>than getting paid in cash. (My dentist's receptionist is befuddled by my
>paying in cash. She clearly prefers to just enter the number of an
>insurance company.)

The magic words are "Hill-Burton Act."  Most hospitals have accepted Hill-
Burton Act funding and are required to admit people with or without 
insurance.  Some resist of course.  

>I have so far elected to self-insure, i.e., to just pay any medical bills I
>might have out of pocket. However, given this "sucker rate" and the
>increasing unwillingness of hospitals to take patients not in health care
>or insurance programs, I may have little choice but to sign up.

Me too.  In 20 years, however, you and I will be drafted into Medicare 
(against our wills) unless the system is substantially modified by then (the 
most likely outcome).

DCF
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