obama: we are held hostage by insurance companies that deny coverage

“We are held hostage at any given moment by health insurance companies that deny coverage or drop coverage or charge fees that people can’t afford,” Obama said in August.

And on whitehouse.gov, the Administration promises more stability and security with health care reform, and points out that 20,000 people were denied treatment, to save money:

A recent Congressional investigation found that over five years, three large insurance companies cancelled coverage for 20,000 people, saving them from paying $300 million in medical claims – $300 million that became either an obligation for the patient’s family or bad debt for doctors and hospitals.

We’ve seen the ads:

We’ve heard a lot of talk about claims being denied by private insurers. But does Obama ever mention that the worst offender is Medicare?

From BigGovernment.com:

What appears to be the official blog of President Obama’s administration is all aflutter because the President will welcome, “doctors from across the United States to the White House to share their unique perspective on the struggles that American families face every day when it comes to health care.” (They posted today’s agenda in the name of transparency!)

The post even links to a National Public Radio (NPR) story in which a survey of medical professionals indicates they are among the biggest supporters of the so-called “public option.” A co-sponsor of the study, Dr. Alex Federman, indicates that, “physicians favored Medicare when it came to delivering care to patients. They thought Medicare was better when it came to autonomy and their decision making and their ability to get patients the care that they thought the patients needed.”

Furthermore, the American Medical Association (AMA) has endorsed the public option after an appeal from the President and despite, according to ABC News, the fact that “some member physicians at the group’s annual meeting [in June] likened the notion to communism.”

Beverly Gossage, Research Fellow for Show-Me Institute and founder of HSA Benefits Consulting wondered which insurance companies rejected the most claims. She found her answer in the AMA’s own 2008 National Health Insurer Report Card. The chart below appears on page 5 of the 16-page report.

“Of the eight insurers listed, Medicare is most likely to reject a claim, sending away 6.85% of requests. This is more than any private insurer and double that of the private insurers’ average!

In short, the AMA is endorsing a plan whose closest existing example is the most frequent denier of claims. How the public option exemplifies “delivering care to patients” is unclear.”

99,546 claims denied: These are non-covered services because this is not deemed a ‘medical necessity’ by the payer. (death panel?)

40,591 claims denied: Non-covered charge(s). At least one Remark Code must be provided (may be comprised of either the Remittance Advice Remark Code or NCPDP Reject Reason Code).

18,626 claims denied: These are non-covered services because this is a routine exam or screening procedure done in conjunction with a routine exam.

41,168 claims denied: This decision was based on a local medical review policy (LMRP) or Local Coverage Determination (LCD).An LMRP/LCD provides a guide to assist in determining whether a particular item or service is covered. A copy of this policy is available at http://www.cms.hhs.gov/mcd, or if you do not have Web access, you may contact the contractor to request a copy of the LMRP/LCD. (death panel?)

Total Medicare claims denied in one year: 475,566

The entire report can be viewed here: AMA 2008 National Health Insurer Report Card

Again, I am all for reform. And it is up to the American people to decide on what type of reform is best. But what I don’t like is misinformation, and un-truthiness.

When people bring up their concerns about a Government takeover of health care, or rationing, or the dreaded death panels, they are scoffed at. Yet, looking at the Medicare denial rates, they deny more patients then seven top commercial health insurers.

So, perhaps the next time Obama puts down private insurance companies for denying claims, or scoffs at those concerned about rationing, or being denied under a public option, someone can point out to him that Medicare is one of, if not the worst, offender?

And while they are busy denying coverage to thousands of people, Medicare is running around willy-nilly overspending by the hundreds of millions of dollars.

According to their own auditors, Medicare knowingly overpays for almost everything it buys. Examples include:

– $7,215 to rent an oxygen concentrator, when the purchase price is $600.

– $4,018 for a standard wheelchair, while the private sector pays $1,048.

– $1,825 for a hospital bed, compared to an Internet price of $1,071.

– $3,335 for a respiratory pump, versus an advertised price of $1,987.

– $82 for a diabetic supply kit, instead of a $47 price on the Web.

Last year, the Health and Human Services Department tried to replace its archaic fixed-price fee schedule for 10 commonly purchased products with a competitive bidding program in 10 cities. The department said the program could save Medicare $125 million in a single year, or $1 billion if adopted nationwide. But Congress stepped in to stop it.

But Congress stepped in to block it….

H/T Newsbusters and memorandum where I first read the story.

The 2009 report care can be found here: 2009 National Health Insurer Report Card. The numbers are slightly better, with denials at 4%, putting them in second place.