Why is your health insurance getting more expensive? You might be surprised…What to do?

28 11 2010

Why is your health insurance getting more expensive? What can you do about it? Here’s a little help.

Politics guarantees rhetoric…so I’m going to avoid that at all costs.

I think it was Twain who said that, “common sense is genius in working man’s clothes” and I think that’s a better approach.

There are several verifiable reasons that your health insurance premium is going up. In fact it would be higher in 2010 regardless of who had been elected. Some reform would have happened regardless, and your premium would have gone up even without it.

My purpose here is to help you understand a little bit of what’s going on, and offer a couple of suggestions on what you can do about it.

I believe that health care is one of the only major moving parts to the US economy where the decision makers are without the basic information they need. You and your Dr are the decision makers I’m talking about. After four years of working in the health insurance industry I have seen plenty of medical claims. My clients, some of whom are Doctors (or other health care workers), have taught me a whole lot about just HOW LITTLE WE ALL KNOW.

Before working in this industry I was a typical guy in this area. I never went to the doctor. I didn’t take any prescription drugs. I didn’t know anything about health insurance. I had no desire to talk about insurance. I would do anything for my wife to “take care” of our health benefits.

Now I know better. A little bit of common sense goes a long way…and it is all too rare.

Why is your health insurance getting more expensive?

1. Health Insurance is a FOR PROFIT Industry.

The truth is that the health care industry is a combination of a variety of moving parts that are ALL for profit industries:

A. Health Insurance Companies are in business to make money. Over the past 80+ years they stay very close to an average 2.2% to 3% profit margin .1 They tend to spend 87% of your monthly premium on medical services and products. They tend to spend 10% on administrative costs.2

B. Doctors, clinics, and hospitals are also here to make money. Sure, most doctors get into medicine to help people. Yes, it’s hard to believe (when your Dr smiles at you) that they do practice medicine to make a profit. Yet this truth plays a part in this big picture. There are also a variety of other players here, but let’s try to keep this from getting too boring. We’re talking about your money here.

C. Prescription Drug Companies have to pay for those spectacular TV commercials. (insert sarcasm here) Pharmaceutical companies average a 19.3% profit margin.3 Every time you see a TV ad, internet ad, or slick magazine ad that someone is paying for it. Don’t get mad at your pharmacist. He’s making a whole lot less money than the thousands of employees in the drug companies.

2. As Seen on TV: We are spending more…on all things health care.

In 2007 we spent an estimated $2.2 trillion, most likely 2010 will see spending at $2.6 trillion, and it’s possible that we’ll hit $4.4 trillion by 2018.4 If your car insurance included every oil change, repair, your tinted windows, and that snow tire change that you just did it’s quite possible that your car insurance would go up. If we want the kind of cutting edge hospitals (perfectly clean and decorated like futuristic Fortune 500 company headquarters) staffed with smart/funny/attractive/philospher/witty doctors we see on TV…well, that’s going to cost even more!

Oh yeah, and there’s that thing called inflation. Medical inflation outpaces general inflation and it’s driving more than half of the growth in health care spending.5

3. Obeying the Law Costs Money.

Going back to 2004, health insurance companies were spending more than $339 billion to obey the law. Some of this was spent paying for benefits that they were required to cover, but more than half of the money was spent on things like filing and reporting on requirements.6

4. We make bad choices. No one wants to talk about this because you don’t make bad choices – other people do. It’s not nice to talk about. Momma always said, “If you can’t say anything nice then don’t say anything at all.” The truth hurts. The truth is that:

“Increasing numbers of patients who are challenged by obesity, smoking, drug abuse, poor nutrition and physical inactivity contribute to an increase in the use of, and therefore the cost of, health care services.7 These preventable risk factors 8 can also contribute to chronic diseases, which account for 75% of the money spent on health care in the U.S. each year.” 9 – quote from anthem.com

5. We burn money

One third of all health care is waste. It’s simple. There is not enough common sense in health care! You’ve probably heard it said, “numbers don’t lie” and “liars use statistics”. One of the resources used by all sides of this debate is the RAND study which says that one-third of all health care is waste.10 Maybe less is more.

6. Cheaters Make a Difference

$180 million is lost to health care fraud every day! 11

7. Most Decision Makers Don’t Know the Real Prices.

If we are all honest…most Doctors and patients have no idea what is being charged (retail, wholesale, and actual cost) for medications. This is a HUGE factor. There is a drastic difference in prices being charged in this turf war between drug companies and insurance companies. Is it fair to expect a doctor to know what is being billed for any medication, when they are seeing so many people each week? If there were a simple public solution for full disclosure of all relevant price information, ON MEDICATIONS ALONE, I believe we would see a quick balancing act in the way that a free market system does work.

Please don’t think for a second that I’m letting the health insurance companies off the hook here. Remember what #1 on this list was. Despite their low profit margin, they’re doing just fine. The total dollar amount, taken in, keeps that fleet of companies afloat.

What can you do?

A. Know your health insurance benefits.

Unfortunately, I myself have not had a Benefits Summary (let alone understood it) of most health insurance policies I’ve had. Please make sure that you have a one page explanation of your health insurance. Make at least a fifteen minute effort at figuring it out. If you need help, ask. I’m happy to help if you like.

You need to understand your benefits. I have seen many stories of families who ended up filing bankruptcies because they were unaware that there were gaping holes in their health insurance policies, then a claim occurred.

Please ask yourself, “How does my coverage work for…?”

1. Doctor Visits (primary and specialists?)

2. Prescription (generic and name brand?)

3. Hospitilization (which is the closest in network hospital and urgent care?)

4. “Max Out of Pocket” (the most you will pay for all covered expenses per person per year?)

Please ask yourself these questions in a specific way. You need to know the answers.

If your employer, HR rep, or insurance agent has left you in a place of NOT BEING ABLE TO ANSWER THESE QUESTIONS, they are not helping you at all.

You may also want to consider how you would pay for a real claim. I have seen many claims, with no more than a one night hospital stay, that reached a “max out of pocket”. Do you plan to finance that with the hospital? Are you saving the cash, tax free, in a Health Savings Account? Do you have a “gap” policy to cover these expenses?

B. Know how you use your health insurance benefits.

Being aware of how you’ve used your health insurance over the past year will help you predict how you will use it over the next year. My wife and I approach our health insurance like we do the IRS. We want to “cover our bases”, but give them the least amount of money possible to do so. How will you know if you are paying each month (in your insurance premium) for benefits you will never use…if you don’t know what benefits you’ve already used?

Over the past year…

1. How many doctor visits?

2. What prescriptions, generic or namebrand, and what do they cost without insurance?

3. Have you had any urgent care or hospitalization?

4. Did you “max out” your health insurance?

How might this be different over the next year?

Dental Etc.: it may be wise for you to take a similar approach to your dental coverage. Some say that 1/3 of all health insurance premium dollars are spent on dental coverage. Yet almost all dental policies have a $1,000 annual max pay out per person. One root canal wipes that out and then you’re paying everything else out of your pocket.

C. Consider whether or not you are “beating Vegas”.

Are you getting the most out of the money you spend on health insurance, each month, or are you paying for benefits that you will never use? If you’ve “maxed out” the health insurance it’s most likely that you have already won, but I’m sure it doesn’t feel that way. Truth is that almost everyone, who pays for their health insurance, hates it until they have to use it for a major claim.

Financial protection is the only valid reason for carrying health insurance, in my opinion. Thankfully health care reform has ensured that annual maximums and lifetime maximums have been wiped out. This makes it easier for the average person to choose a decent health insurance policy.

This means that there are four areas where you may be able to adjust your health benefits to get better use your health insurance premium:

…sorry, make sure that the “shoe fits” in these four areas:

A. Doctor Copays – Do you visit often enough to warrant an unlimited number of doctor visits at copays?

B. Prescription Copays – How are you currently using prescription medications? Cancer chemo can be billed under Rx, be careful here.

C. Max Out of Pocket – What total dollar amount of risk is appropriate for you and how will you protect yourself from it?

A higher max drastically reduces the monthly premium. A “gap” policy, if it’s quality protection, may be a perfect solution.

D. Dental Coverage – Does each family member get two dental cleanings per year?

If so, you probably should pay for dental coverage. If not – DON’T.

D. Learn as much as you can.

The free market system only works if the decision makers (of supply and demand) know what’s going on. Does the “seller” know what it cost to bring the product to market? Does the “buyer” know what price is being paid?

If you are currently taking a blood pressure, cholesterol, acid reflux, or depression medication (the drugs I hear about from most clients) please consider learning how much your insurance company is billed by the drug company. Why? This does effect your monthly insurance premium, eventually! Please consider asking your doctor about the costs and about alternatives.

This would be a good start.

E. Act on what you learn.

Do what you can to be sure that your health insurance fits you. Is it the protection you need? Will it work the way you want?

Plenty of employers have chosen to reduce the quality of their benefits, to lower the premium. You may have benefits with no name brand drug coverage, a smaller network, or a higher out of pocket maximum than you did the year before. Any of these items could mean a whole lot more money out of your pocket when you are sick.

If you are involved with your benefits more, your employer will care. If you’re self-employed, or buy your own coverage, the solution is much simpler. SHOP AROUND and feel free to contact me with questions!

Talk to the person making the decision about your health insurance. Ask for benefits that fit you!

If you care, learn, and act – there will be less medical bankruptcies and a more responsible approach to health insurance premiums.

F. Vote and Vote Responsibly.

Regardless of who is elected next and what happens in the House/Senate: I do not believe that our government will relinquish the new found control it has over the industry. It is now, more than ever, about state rights versus federal control.

Regardless of your opinion of our current law: your hospital, drug company, and insurance company were probably looking for some sort of reform two years ago. The truth is that very few U.S. citizens want to spend even thirty minutes reading about the problem of our current health care system.

In our country, law makers are constantly thinking about a popularity contest and that means the average person is really a decision maker…making decisions with very little knowledge of the average costs (Dr, Rx, hospitalization).

Vote for common sense solutions. Regardless of the party, regardless of the issue we need leadership working toward solutions that work. Unfortunately, I don’t see much of that from either party. Hopefully we will see a variety of possible solutions soon.

What do you think? Feel free to leave a question or comment here.


1. Compiled from data from Fortune 500 Annual Ranking of America’s Largest Corporations 2008.

2. Pricewaterhouse Cooper’s Health Research Institute “Share of Benefit Premiums” Medical Cost Trend for 2009.

3. Kaiser Health News June 19, 2009

4. Centers for Medicare. Office of the Actuary, National Health Statistic Group

5. Businessweek, “Behind Rising Health-Care costs” July 14, 2008

6. Conover, Christopher J “Health Care Regulation: A $169 Billion Hidden Tax.” October 4, 2004

7. Pricewaterhouse Cooper’s “The Factors Fueling Rising Health Care Costs 2008” December 2008

8. Thorpe, et al, Health Affairs, June 2005

9. Will Dunham, More Americans getting multiple chronic illness, Thomson Reuters, January 2009

10. rand.org health services utilization study accessed April 21,2010

11. National Health Care Anti-Fraud Association “The Problem of Health Care Fraud”

Special thanks to anthem.com (from whom I’m only collecting $32 monthly in residual commission) for assembling the above research, for they’re own purposes granted, but they helped me in pulling this data together more efficiently.

Ear Candy Saturdays – what do you call hip hop?

27 11 2010

Ear Candy Saturday

We live on the sunny side of the street, in a city style row house, facing south. What a difference it makes! These cool fall afternoons have people looking for sun light and shelter from the wind. I love to walk our side of the street – in the sun.

Here’s a few artists who have found a way to do hip hop with a positive effect.

PND – Lonestar

Lecrae – Background

LA Symphony – Timeless

Sareem Poems – Windows to the Soul

Video is music only.

Flynn Adam – Dishes

Pigeon John – Weight of the World

…this is a fan video not an official video by PJ

Ohmega Watts – Eyes and Ears

Abstract Rude & Pigeon John – Life Goes On

The Roots – Dear God

Opportunity to create a new world for freedom and justice.

24 11 2010

Happy Thanksgiving!

“We thank God for our homes and our food and our safety in a new land. We thank God for the opportunity to create a new world for freedom and justice.”

This is reported to be a line from the prayer at the first Thanksgiving feast (from the Washington Post).

For some reason this really struck me today. Rebecca and I packed up our family this past August. We moved to Baltimore to start a church from scratch. We have settled into new homes with a similar hope.

This week I am thankful for our homes, our food (you know I love to eat), and our safety in a new land. I thank God for the opportunity to create something new. I believe that our work will bring a spiritual freedom for people who do not yet know Jesus Christ.

Here’s one of the verses that lead us to Baltimore:

“Let this be recorded for future generations,
so that a people not yet born will praise the Lord.”

Psalm 102:18

It’s important for you to know that we would not be here if it were not for the generations before us, of faithful believers working for a generation that would come. We’ll say thank you (via skype) to our families who have made this possible. And I also want to say thank you to the generations of believers that sacrificed so that City Bible Church would be possible.

The work we do now is as much for the future as it is for the present.

We believe that there will be some who will join us, that knew Jesus before we started. Yet we also believe that most who will join us will come to know Christ through us: in our homes, on the street, in our beautiful city, and at their work place. I BELIEVE.

I believe we work for the future. We live to help people know the peace and freedom we have in Jesus Christ.

When William Brewster thanked God for safety most of their number had died between the time they set out from Europe and that Thanksgiving Day. When he thanked God for safety and justice they were searching for freedom from religious persecution. They had been punished for their faith.

Baltimore has long been a city that celebrated a freedom of religion. I pray that we will be free to live and speak what we believe. I pray that this will bring change to the city.

We want to serve the city in a way that will help people find real freedom. No more fear, hate, divorce, cancer, addiction, murder, and slavery to selfishness. May God’s true freedom again be the reputation of Baltimore!

This week, we thank God for our homes that will be a place people can find freedom!

A Charlie Brown look at the Thanksgiving prayer:

If you want more tidbits from the web – Wiki on First Thanksgiving:


Ear Candy Saturdays EXTRA – What does the Blues have to do with Amazing Grace?

20 11 2010

Tinkering around with the guitar I uncovered the blues: Albert King, Robert Johnson, and even some Ray Charles. The blues can be something that people just don’t understand. You can’t just pass by the window and smell the fresh baked bread – no, you have to sit down and taste it for a while…to really appreciate what’s going on.

We love to sing when we’re miserable:

What? You don’t know who Albert King is? Here’s a clip of him playing with SRV and BB King:

Here’s a more classic look at Albert King:

It’s hard to talk about the roots of the blues without mentioning Robert Johnson:

If you’re going to discuss the roots of the music…well, everyone has known pain in some way and we all express it different ways…if you’re going to talk about music: the blues is written in the pentatonic scale. That is where Eric Clapton has made a living.

oh and BB King

If you want to learn how to play the blues…well, Wintley Phipps discusses the “blues” scale in this clip. You’ve got to see this:

It’s simple really.

You have to have a story to tell, the courage to write it, the guts to sing it out loud with passion, and the “blues” scale to play it on. With all of that combined you can sing your blues away….and possibly become a millionaire.

Ear Candy Saturdays:

20 11 2010

Ear Candy Saturdays

Uncovering something good for the first time…well, that’s just one of the best things in life.

When it comes to music, it seems like everyone under the age of 40 (that includes me) thinks a band is ruined if they get discovered. Listen, it’s not like a cafe where “getting discovered” means you can’t get a table. The beauty of music is that you can always listen. If other people discover your band it just means that the artist is more likely to produce another album.

I love discovering a new sound. There’s something to learn from anyone. Hearing a new voice can be such a great experience!

…my favorite movie quote on pop music…

I just wanted to put out there some of the songs I’ve been listening to lately.

Maybe you’ll find something that you like – for the first time.

When I started this list it was huge and so I checked out a few of the videos. That lead me to just putting a few songs here to get started. Most likely I’ll start to list different stuff every week, but I’m really interested in what you might have to say…or what you might have to suggest.

The list is by artist and then song name (in no particular order):

OK Go – This Too Shall Pass

Ok Go does some crazy videos with their music. This is one of my favorites. You’re going to want to watch this a few times, but you’ll probably still be distracted from the music.

Mutemath – Backfire

These guys have been innovative with their musical expressions and I’ve really enjoyed it. This video is a bit crazy. Good times.

Derek Webb – Cobra Con

Seems like some of Derek’s past success has caused most people to put him in a box. This guy is a great writer and I think he has found a real voice to be heard.

Seabird – Don’t You Know You’re Beautiful

Gungor – Brighter Day

Here’s a simple unplugged version of this song. It’s more interesting with a full Sufjan Stevens kind of orchestra.

Hopefully you enjoyed this with a good cup of coffee to start off your weekend!

learning from Francis Chan

18 11 2010

Leaders who are not afraid to ask tough questions inspire me.

A healthy amount of being transparent in following Jesus is all too rare.

Francis Chan seems to be this sort of leader. See his message “Luke Warm and Loving It.”

When you know it’s time for a change, you know.

Thankfully Francis Chan is being honest about his journey. He’s not waiting until he has it all figured out to produce a slick professional web site and print work. He’s decided to be open about the fact that God is leading him away from life in suburbs to serving the poor in the city of LA.

Francis Chan isn’t hitting the eject button on God’s idea of church. He’s simply stepping out of his role as Senior Pastor of Cornerstone at Simi Valley.

Francis Chan, Mark Driscoll, and Josh Harris were tasked with discussing a different topic, but ended up discussing Francis’ move.

Sounds like he’s doing this in a responsible way. There’s qualified eldership in place overseeing the church. There’s a qualified pastor taking his spot. He’s going to continue to serve as a volunteer elder.

Seems like some people have mistaken his honest pursuit of God’s will for giving up on church. I don’t hear that from him at all.

Unfortunately, some of us have a wrong idea of spiritual leadership. I don’t see anywhere in the Bible a Rock Star Senior Pastor…or a job description that is an ultimate destination.

Instead, the example of Jesus, is one of servant leadership. I believe that a more common sense Bible based idea would be that:

  • God created each of us unique.
  • Each of us have an opportunity to serve where we are today.
  • Over time we may serve in different capacities.
  • A job description does not equal personal worth.

If you follow the narrative story of the life of any number of leaders in the Bible you will watch them serve in different capacities. Peter and Paul were church planters (and our understanding of senior pastors, or “chief among equals” elders) in a few different situations. You will find them serving in different roles. Regardless of which job description they had at the time – they were working to serve Jesus and build the church to advance the kingdom of God.

Someone once described me like a Leatherman tool:

because over time I served the church in several different ways. I just believe that it doesn’t matter what the role is…you see a need and meet it. Of course, each job description may have a unique impact.

As a fourth generation pastor, I cannot believe that the role my grandfather plays today (serving the “seniors” of our church) is more or less important to God than the years he spent as a senior pastor.

The truth is that we serve at the pleasure of King Jesus. When He wants us to move on, we move on.

There is no job description that is an end destination. By the grace of God, and only through the miracle of the saving grace of our God, we serve Jesus on this earth and hope that some day we hear, “well done”.

Grandpa Leif says to me, “know your calling, don’t go above it and don’t go beneath it.”

Here’s to a simple life of following Jesus – where and when He directs us.

A letter from prison really taught me something.

18 11 2010

Paul is in a Roman prison and he writes a letter. Ephesus was a city where he spent time helping people, get to know Jesus. He cared about them and dropped them a line or two. He was working to strengthen them in their love and faith, in Jesus Christ.

It’s great! It is one reason that we are here, in Baltimore, with a vision to connect people with Christ, help them grow in Christ, and inspire them to share Christ.

…simply stated:

  • Connect with Christ
  • Grow in Christ
  • Share Christ

Just for your benefit, here’s a few words from his letter to the Ephesians:

(from the New Living Translation)

1:1-8 This letter is from Paul, chosen by the will of God to be an apostle of Christ Jesus. I am writing to God’s holy people in Ephesus, who are faithful followers of Christ Jesus. May God our Father and the Lord Jesus Christ give you grace and peace. All praise to God, the Father of our Lord Jesus Christ, who has blessed us with every spiritual blessing in the heavenly realms because we are united with Christ. Even before he made the world, God loved us and chose us in Christ to be holy and without fault in his eyes. God decided in advance to adopt us into his own family by bringing us to himself through Jesus Christ. This is what he wanted to do, and it gave him great pleasure. So we praise God for the glorious grace he has poured out on us who belong to his dear Son. He is so rich in kindness and grace that he purchased our freedom with the blood of his Son and forgave our sins. He has showered his kindness on us, along with all wisdom and understanding.

2:3-10 All of us used to live that way, following the passionate desires and inclinations of our sinful nature. By our very nature we were subject to God’s anger, just like everyone else. But God is so rich in mercy, and he loved us so much, that even though we were dead because of our sins, he gave us life when he raised Christ from the dead. (It is only by God’s grace that you have been saved!) For he raised us from the dead along with Christ and seated us with him in the heavenly realms because we are united with Christ Jesus. So God can point to us in all future ages as examples of the incredible wealth of his grace and kindness toward us, as shown in all he has done for us who are united with Christ Jesus. God saved you by his grace when you believed. And you can’t take credit for this; it is a gift from God. Salvation is not a reward for the good things we have done, so none of us can boast about it. For we are God’s masterpiece. He has created us anew in Christ Jesus, so we can do the good things he planned for us long ago.

3:6 And this is God’s plan: Both Gentiles and Jews who believe the Good News share equally in the riches inherited by God’s children. Both are part of the same body, and both enjoy the promise of blessings because they belong to Christ Jesus.

3:16-20 I pray that from his glorious, unlimited resources he will empower you with inner strength through his Spirit. Then Christ will make his home in your hearts as you trust in him. Your roots will grow down into God’s love and keep you strong. And may you have the power to understand, as all God’s people should, how wide, how long, how high, and how deep his love is. May you experience the love of Christ, though it is too great to understand fully. Then you will be made complete with all the fullness of life and power that comes from God. Now all glory to God, who is able, through his mighty power at work within us, to accomplish infinitely more than we might ask or think. Glory to him in the church and in Christ Jesus through all generations forever and ever! Amen.

4:1-3 Therefore I, a prisoner for serving the Lord, beg you to lead a life worthy of your calling, for you have been called by God. Always be humble and gentle. Be patient with each other, making allowance for each other’s faults because of your love. Make every effort to keep yourselves united in the Spirit, binding yourselves together with peace.

4:15-16 Instead, we will speak the truth in love, growing in every way more and more like Christ, who is the head of his body, the church. He makes the whole body fit together perfectly. As each part does its own special work, it helps the other parts grow, so that the whole body is healthy and growing and full of love.

4:29-32 Let everything you say be good and helpful, so that your words will be an encouragement to those who hear them. And do not bring sorrow to God’s Holy Spirit by the way you live. Remember, he has identified you as his own, guaranteeing that you will be saved on the day of redemption. Get rid of all bitterness, rage, anger, harsh words, and slander, as well as all types of evil behavior. Instead, be kind to each other, tenderhearted, forgiving one another, just as God through Christ has forgiven you.

5:1-2 Imitate God, therefore, in everything you do, because you are his dear children. Live a life filled with love, following the example of Christ. He loved us and offered himself as a sacrifice for us, a pleasing aroma to God.

5:15-20 So be careful how you live. Don’t live like fools, but like those who are wise. Make the most of every opportunity in these evil days. Don’t act thoughtlessly, but understand what the Lord wants you to do. Don’t be drunk with wine, because that will ruin your life. Instead, be filled with the Holy Spirit, singing psalms and hymns and spiritual songs among yourselves, and making music to the Lord in your hearts. And give thanks for everything to God the Father in the name of our Lord Jesus Christ.

6:10-13 A final word: Be strong in the Lord and in his mighty power. Put on all of God’s armor so that you will be able to stand firm against all strategies of the devil. For we are not fighting against flesh-and-blood enemies, but against evil rulers and authorities of the unseen world, against mighty powers in this dark world, and against evil spirits in the heavenly places. Therefore, put on every piece of God’s armor so you will be able to resist the enemy in the time of evil. Then after the battle you will still be standing firm.

6:18 Pray in the Spirit at all times and on every occasion. Stay alert and be persistent in your prayers for all believers everywhere.

6:23-24 Peace be with you, dear brothers and sisters, and may God the Father and the Lord Jesus Christ give you love with faithfulness. May God’s grace be eternally upon all who love our Lord Jesus Christ.