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Earlier, we noted that states like Oregon were requiring that insurance companies raise their premiums. Kaiser Health News reported that the Department of Health and Human Services (HHS, part of the federal government) is pushing for lower insurance premiums. The conflicting directions probably stem from different emphases on time frames from different departments.

Earlier, we noted that states like Oregon were requiring that insurance companies raise their premiums. Kaiser Health News reported that the Department of Health and Human Services (HHS, part of the federal government) is pushing for lower insurance premiums. The conflicting directions probably stem from different emphases on time frames from different departments.

State insurance regulators have a longer-term fear that insurance companies who set their premiums too low will go out of business, leaving the state exchanges short on viable options. HHS, on the other hand, probably wants to cement some goodwill in the general population, especially before the 2016 elections. Part of the issue is that insurance premiums for many Americans increased when ACA rolled out (my personal premiums basically doubled). The recent media about insurance companies requesting 20% or 30% annual increases (on top of earlier increases) certainly gives additional ammunition to ACA's critics. Understandably, HHS would want to minimize these increases, perhaps arguing that a short-term outcome that is favorably received by the general population is necessary for the long-term success of the law. It'll be interesting to see where premiums settle over the next few years, and whether or not those increases are above or below the annual premium growth of the decade before ACA.

The Kaiser Family Foundation released the results to an interesting survey this week. About three-quarters of the people polled felt that the cost of prescription drugs are unreasonably high. The cost of prescription drugs ranks above doctor visits as a financial burden (though less than health premiums and deductibles).

The Kaiser Family Foundation released the results to an interesting survey this week. About three-quarters of the people polled felt that the cost of prescription drugs are unreasonably high. The cost of prescription drugs ranks above doctor visits as a financial burden (though less than health premiums and deductibles). 74% of those surveyed answered that they believe pharmaceutical companies are too concerned about making profits, as opposed to having the right balance between profits and helping people. Perhaps, then, we shouldn't be surprised that pharmaceutical companies had the largest percentage of respondents who had a very unfavorable view of them -- even more than oil companies.

Interestingly, while 78% of those surveyed think that generic prescription drugs are of the same quality as brand-name prescription drugs, only 52% asked for a generic drug when prescribed a brand-name drug. Perhaps a significant sector of those surveyed did not know they could ask for a generic version, or maybe they don't actually think that the cost of prescription drugs is unreasonably high. Respondents seem open to a variety of mechanism to address prescription drug costs, including allowing Americans to import drugs from Canada.

Earlier, we had noted how the state of Massachusetts requires that health care providers make pricing information available to inquiring consumers. It appears that the legislation did not specify any consequences, and perhaps not surprisingly, people are still having difficulty procuring pricing information. Interestingly, the difficulty differed by specialty.

Earlier, we had noted how the state of Massachusetts requires that health care providers make pricing information available to inquiring consumers. It appears that the legislation did not specify any consequences, and perhaps not surprisingly, people are still having difficulty procuring pricing information. Interestingly, the difficulty differed by specialty.

The president of the Massachusetts Medical Society seems to defend doctors' offices by saying that prices are complicated because different insurers have negotiated different rates. The problem with that line? Doctors' offices didn't even know the price that would be charged to patients who would pay without insurance.

Sadly, the health insurance companies also fared poorly in a review of their tools for online healthcare shopping. Still, the legislation is a step in the right direction, and hopefully, more of the industry will adjust as increasing numbers of patients ask for this information.

With the passage of the Affordable Care Act, providers who were terminated with cause from one state's Medicaid program are now no longer eligible to participate in another state's Medicaid program. This measure was supposed to reduce fraud by providers who would get caught in one state and simply set up shop in a different state. That's the theory at least.

With the passage of the Affordable Care Act, providers who were terminated with cause from one state's Medicaid program are now no longer eligible to participate in another state's Medicaid program. This measure was supposed to reduce fraud by providers who would get caught in one state and simply set up shop in a different state. That's the theory at least.

Reuters and the U.S. Department of Health and Human Services Office of the Inspector General both conducted independent studies and found contrary to that. The Office of the Inspector General recommended that the government work to standardize terminology used by different databases so that each state can more easily detect when a provider is no longer eligible.

On one level, I sympathize with the problems of standardizing data across different sources. We at DocSpot deal with that problem frequently. On another level, though, the Department of Health and Human Services was the organization that put forth the National Provider Identifier system for the purpose of uniquely identifying providers across multiple contexts. They had to do a fair amount of work for that project, and it seems that they could have done a better job of standardizing termination terminology upfront in order to comply with legislation and reduce millions of dollars paid out in fraud.

One of the centerpieces of the Affordable Care Act was to create health insurance exchanges for each state. More than that, the health insurance exchanges required the insurance plans to be grouped into different tiers (e.g. Bronze, Gold) so that consumers could more easily compare their options. When experiencing a simplified the selection process, some consumers probably ended up selecting less expensive plans than they would have otherwise since they could feel more confident that they were indeed selecting a comparable package. That's the theory at least. A related theory is that competitive marketplaces (exchanges that offered more plans) should experience lesser price increases. On this theory, the Department of Health and Human Services (HHS) has released some preliminary data that substantiates this point.

One of the centerpieces of the Affordable Care Act was to create health insurance exchanges for each state. More than that, the health insurance exchanges required the insurance plans to be grouped into different tiers (e.g. Bronze, Gold) so that consumers could more easily compare their options. When experiencing a simplified the selection process, some consumers probably ended up selecting less expensive plans than they would have otherwise since they could feel more confident that they were indeed selecting a comparable package. That's the theory at least. A related theory is that competitive marketplaces (exchanges that offered more plans) should experience lesser price increases. On this theory, the Department of Health and Human Services (HHS) has released some preliminary data that substantiates this point.

In an issue brief, HHS released data indicating that the counties with a net increase in the number of insurers experienced a 2% price reduction for the benchmark plan, where as counties with a net decrease of insurers experienced a 12% increase in the benchmark price. HHS did not release enough data for us to be sure that the two numbers (number of insurers and price of benchmark premium) are related. For example, there might be confounding variables. Also, the benchmark premium is defined as the second lowest cost silver plan, which is somewhat awkward since insurers might be able to reduce costs by altering other aspects of the plan that are not easily comparable (such as narrowing the network of providers that accept the plan). These concerns are slightly alleviated by looking at the weighted enrollment (e.g. if a plan is terrible, fewer people will enroll in it even though it's cheaper), and there, the gap between the two different categories of counties was much smaller (1% increase vs. 4% increase), but still supports the overall theory.

Overall, the numbers do suggest that increased competition does actually lead to lower prices. The issue brief also notes that most counties did see an increase in the number of insurers, which is also positive for the consumer (even if the prices were not affected). On those notes, the health insurance exchanges seem to be functioning as designed: facilitating competition to drive down premiums.