Ironshore Hires Another Top AIG Executive

AIG Environmental executives (from left): John O’Brien, Executive Vice President; Joseph Boren, Chairman/CEO; and Peter Gilbertson, Director of Marketing.

Ironshore recruits another AIG executive to head excess liability unit

Ironshore Inc. has expanded its management team with the appointment of former American International Group (AIG) Cat Excess Liability president Geoff Smith as worldwide head of its newly-launched excess liability facility. Mr. Smith is the latest in a line of recent recruitments from AIG.

In his new role, Mr. Smith, who will work out of New York and report to Shaun Kelly, CEO of Ironshore's US operations, and Keven Kelley, CEO of Ironshore, who in turn both joined the company from New York-based American International Group's (AIG) Lexington Co. last month, will provide global strategic direction and consistency across all of Ironshore's platforms writing the liability product set.

A new unit will be established to write catastrophic excess casualty insurance for Ironshore Bermuda, targeting Fortune 2000 and other clients purchasing cat excess coverages.

Mr. Smith has 24 years of liability underwriting experience in the re/insurance market, working at AIG since December 2000 and serving as vice-president at General Reinsurance Corp. in the National Account from February 1998 to December 2000.

"Hiring Geoff is a big win for Ironshore as we expand into the cat excess liability arena,' said Mr. Kelly. "He brings a wealth of expertise in underwriting and managing excess liability portfolios.

"The launch of this cat excess liability unit will further add to Ironshore's product and geographic diversification."

Health Insurance Reform

A Fresh Call For Health Insurance Reform

By ARIELLE LEVIN BECKER

It wasn't that Debbie Hunsinger didn't know about the lump in her breast. She did. And it wasn't that she didn't care about her health. Back when she had health insurance, she never missed a physical.

But a divorce left her without health coverage, and although she owned a deli in South Meriden, Hunsinger couldn't afford health insurance. She couldn't afford to see a doctor, either, so she decided not to deal with the lump. At the time, it was pretty small.

But by the time she finally got it checked out, about six months later at a free screening, it wasn't small. 

And the cancer had spread to her lymph nodes and right arm.

If the cancer had been caught earlier, if she hadn't been one of the more than 300,000 people in Connecticut without health insurance, Hunsinger, 47, figures she might be healthy and back at work by now. Instead, she's facing dozens more rounds of chemotherapy and radiation and an uncertain prognosis.

Hunsinger thinks something must change. "I would hate to have anybody have to go through this just because they don't have health insurance," she said.

Her struggle is one of the reasons advocates say that it is finally time to make broad changes — an effort that will get a jump-start today in Hartford when the Universal Health Care Foundation of Connecticut unveils its proposal calling for major changes in the health system and a plan that the group says could insure 98 percent of state residents by 2014.

It is the first of many proposals — both state and federal — expected to be aired in what many people say is the year for health reform. 

State legislators expect to address the issue in the current session, and the topic is expected to be a top priority for President-elect Barack Obama. Already, members of Obama's health care advisory team have been gathering input through meetings on health care reform, including one at the UConn Health Center last week.

It won't be an easy year, though. The prospect of new state spending or major federal reform might face tough obstacles as state legislators grapple with a projected $6 billion biennial budget gap and the Obama administration confronts an economy in shambles.

But advocates for reform say that the economic crisis and growing unemployment, with more Americans at risk of losing their health insurance, makes this precisely the time to tackle health reform.

"Fixing health care is about fixing the economy, that's sort of the bottom line," said Juan A. Figueroa, president of the Universal Health Care Foundation.

Figueroa said that the foundation's plan would put Connecticut in a strong position as the federal government addresses health reform, allowing the state to shape the national debate and be ready to tap into any resources that the federal government makes available for health reform.

The proposal calls for a new health program, called SustiNet after the Latin word for "sustains," that would extend health insurance to anyone who wants it while emphasizing preventive care and other changes.

The plan, which would begin enrollment in 2011, would create a gigantic health insurance pool by combining the existing pool of state employees and retirees with people now covered under state assistance programs.

The pool would also be open to the public, starting with those without access to employer-sponsored insurance, those whose employer-sponsored insurance is inadequate or unaffordable, and employees of small businesses, nonprofit groups and municipalities. 

Ultimately, any employer in the state could use the state's pool instead of their own insurance. Employers who wish to participate would pay in as they would any other health insurance plan.

Mid-size and large employers would not, however, be able to simply drop coverage and allow the state to pay the cost of their employees' care. Employers with payrolls above $318,000 that do not offer insurance or provide adequate coverage to their employees would be required to help pay the cost of the program.

The plan is for the pool to compete with, not replace, private insurance plans. The proposal would not require everyone to be covered, but would automatically enroll people without insurance unless they opt out of the plan.

The foundation believes that the size of the pool will lead to lower costs — a critical element of the plan. According to the foundation, the plan would save individuals and employers $1.7 billion by 2014, although it would require the state to spend an additional $950 million in 2014, the year that the plan is expected to be fully operating. 

That figure includes the cost of subsidizing coverage for previously uninsured people and increasing the notoriously low payments that doctors receive for seeing HUSKY and Medicaid patients.

The concept of expanding the state's employee insurance pool isn't entirely new. A proposal last year to open that pool to municipalities and small businesses passed the General Assembly, with strong support from Democratic leadership. But Gov. M. Jodi Rell vetoed the bill. 

Figueroa said that the foundation's proposal offers a far more comprehensive approach and that he hopes Rell and other state officials will be supportive.

"This is a time not to be weak-kneed about these issues," he said. "This is a time to exercise strong leadership."

The foundation's figures for 2014 are based on several assumptions, including:

•$570 million in premiums paid by individuals covered by the plan; premiums would be charged on a sliding scale, based on people's ability to pay.

•$80 million in "shared responsibility payments" from employers with payrolls over $318,000 that don't provide insurance coverage to their employees.

•$240 million in revenue from companies whose employees join SustiNet because their company-sponsored plan is inadequate.

•An additional $800 million in federal funding by expanding the federally subsidized HUSKY program.

SCHIPing away at the need for health insurance

When Bill Clinton's health care proposal was foundering in the summer of 1994, a group of senators suggested that the administration put off trying to get universal coverage and insist instead on insuring all children. The idea was to make, at least, a down payment on reform.

The White House said no and pressed on with its doomed effort to get a bigger bill. The Republicans won control of Congress in the fall. It wasn't until 1997, thanks to the unlikely duo of Sens. Ted Kennedy and Orrin Hatch, that a children's health care program was finally passed.

One of the clearest signals President-elect Barack Obama has sent is his determination to learn from the Clinton years, and particularly from the former president's failures on health care.

When Tom Daschle, Obama's pick to be secretary of health and human services, returned to the Senate last week for his first round of confirmation hearings, he offered a long list of criticisms that others had directed at the original health care reform effort. This time, he said, would be different.

And this week, the House of Representatives is determined to prove Daschle right. It is scheduled to take up an extension of the State Children's Health Insurance Program (SCHIP), as the Kennedy-Hatch initiative is called, so that 10 million kids can get health insurance. Getting more children covered before Congress starts wrangling over the larger health care bill is good politics, and the right thing to do. Congress needs to act anyway, because the program expires March 31. It might as well act fast, and act generously.

The SCHIP bill is unfinished business from the Bush years, and Democrats have no better way to show, and quickly, how different their approach to government will be from the style and priorities that prevailed during the outgoing president's term.

President Bush twice vetoed an extension of SCHIP. He opposed the additional $35 billion the Democrats wanted to spend to cover more children and also disliked the tobacco tax they proposed using to pay for it. There are many big things people hold against Bush, but this one has always stuck in my craw. If "compassionate conservatism" - remember that phrase? - means anything, surely it should mean helping more kids go to the doctor when they need to.

Some advocates of universal coverage have argued that an expansion of SCHIP should be delayed so that the issue of covering kids can be taken up as part of a larger health proposal. The worry is that passing the most popular part of reform now (is there a more sympathetic group to cover than children?) would make it easier to delay the broader effort.

These are good faith concerns, but Congress would be right to ignore them. The economic downturn has made the expansion of SCHIP all the more urgent.

It's not just that sharp increases in unemployment add to the ranks of the uninsured. State governments are hurting, too, and they are responding to revenue shortfalls by shrinking health care programs.

According to Families USA, a group that pushes for fundamental health care reform, states have enacted budget cuts that will leave some 275,000 people without health coverage, including 260,000 children in California. By the end of this year, if further proposed cuts go through, the number losing health coverage nationwide could rise to more than 1 million, almost half of them children. Other states have reduced benefits to those they still insure.

All this makes the case for fiscal relief to the states in a stimulus bill more compelling. It also makes clear that universal health insurance coverage should be an urgent priority. But getting the children's program done in the meantime could create momentum for the larger program and reduce the size of the problem that needs to be solved in a comprehensive bill - 10 million kids now, the rest later.

Senate Majority Leader Harry Reid has not made any commitments as to when he would take up children's health care, though he has listed it as a priority. It would do the new president and members of the Democrats' expanded congressional majority no harm to move expeditiously on a proposal that is simultaneously bipartisan - SCHIP has always enjoyed significant Republican support - and embodies Obama's oft-stated commitment to "programs that work." This one surely does.

How often did Obama promise to "turn the page," implying that his presidency would be very different from President Bush's while also taking lessons from President Bill Clinton's shortcomings? Winning a quick health care victory for children would prove he's determined to do both.

The largest federal health insurance program

A focused remedy is best cure for healthcare crisis

As the Senate considers the nomination of former Sen. Tom Daschle as secretary of health and human services—and as the nation looks forward to health reform—it is important that policymakers focus on what it means to “fix” health care and ask some hard questions about how we deliver medical care.

First off, everyone should agree that we must strive to get every American the health care coverage they need. 

Second, we can all agree that getting health care costs under control is both a health and economic imperative. Despite the “good news” this week that health care spending rose 6.1% to $2.2 trillion in 2007, that slowdown from previous years is still substantially higher than general inflation and health care now gobbles up 16.2 % of gross domestic product.

But high costs and the uninsured are only the visible problems with health care. The invisible problem is poor-quality care. Our third area of agreement must go beyond getting people care, to getting them the right care. 

Poor quality care and the uninsured are inextricably linked, even though few understand the link. Poor quality care robs the system of precious resources—dollars and services—that could be used to expand access and coverage.

Lawmakers need look no farther than their own back yard to ask questions about the quality and inefficiency problems. Medicare is the largest federal health insurance program, so lawmakers should ask why an elderly person spends about 11 days in the hospital in Bend, Oregon in the last two years of life, compared to 23 in Detroit or nearly 35 in Manhattan. Or why they see doctors about 15 times in Ogden, Utah in the last six months of life compared to 42 in Detroit or 60 in Los Angeles. 

They should ask why researchers found that only 57 percent of female patients aged 65–69 in Mississippi got regular mammograms, compared to 70 percent in Michigan or 74 percent in Maine, the top state. Or why in Alaska, only 71 percent of patients with diabetes got important blood tests in 2003–2005, compared to 86 percent in Michigan or 92 percent in Vermont. Or most tragically, why more than 1.6 out of every 1,000 Medicare beneficiaries in Louisiana lost a leg to amputation, compared to 0.9 in Michigan or 0.50 in Utah, a more than three-fold difference from top to bottom?

They should also ask hard questions about why people get care they may not need. Why are antibiotics prescribed inappropriately for children’s ear infections 13 million times a year, when more than 80 percent of infections get better within three days without antibiotics? 

Why in a decade did spending for back surgery called lumbar fusion rise 500 percent—from $75 million to $482 million—despite a lack of evidence supporting the effectiveness. And why do some regions of the country use vastly more resources to treat patients with similar illnesses without achieving better outcomes. 

They will find what Dartmouth researchers found, that a whopping 30 percent of health care spending—nearly $700 billion a year—pays for services that may not improve people’s health.

That’s money that could be used to cover the uninsured—if we can figure out how.

A good place to start is improving the information we have about the actual performance of doctors and hospitals with wider spread use of reports such as those Medicare has begun to make available on hospitals and a few pioneering community organizations, such as the Greater Detroit Area Health Council (GDAHC), have made available on both hospitals and doctors’ practices in their communities (www.SaveLivesSaveDollars.org). Patients need this information to make informed choices about their own care. Doctors and hospitals need this information to help them improve care. And both consumers and purchasers need information about the value they are getting for their health-care dollars. 

A second step is to put serious dollars into quality improvement efforts, building on Medicare pilot programs that spur hospitals and physician group practices to improve care and launch experiments that encourage disparate medical providers to work in teams to coordinate care and deliver it efficiently.

Finally, our payment system must reward providers for giving patients the right care at the right time, the right way. 

Now we pay providers for “doing things”: the more treatments and procedures they provide and the more they use expensive technology, the more they get paid. We need to reward, not punish, providers who deliver high-quality, cost-effective care. Moreover, providers should be fairly compensated for preventive care, for time spent coaching patients and for coordinating care for those with chronic conditions.

Many of these concepts are being tested on the ground in living laboratories such as GDAHC’s Save Dollars Save Lives campaign, one of 14 communities working with the Robert Wood Johnson Foundation’s Aligning Forces for Quality program to bring together those who get care, give care and pay for care to improve the quality of care.

As Washington turns it eye to health care reform, by all means let’s start with getting everyone access to care, but everyone should also understand that what happens to them once they get inside the hospital or doctors’ office is just as important as getting them in the door.

Dr. Risa Lavizzo-Mourey is president and CEO of the Robert Wood Johnson Foundation, and Vernice Davis Anthony is president and CEO of the Greater Detroit Area Health Council

10.9 million Americans Have Individual Health Insurance Policies

About 10.9 million Americans under age 65 purchased individual health insurance policies at some point in 2006, but only 7 million were covered by these policies for the full year, according to the latest News and Numbers from the Agency for Healthcare Research and Quality. The 3.9 million individuals who had individual health insurance policies for part of the year were covered for about six months on average. 

AHRQ's analysis also shows that of Americans who bought individual policies for part of the year, nearly 44 percent were able to obtain coverage for the full year because they or their spouse got a job that offered health insurance or they had incomes low enough to quality for Medicaid or other public insurance. Most of this coverage came from employers.

Forty percent obtained employer-sponsored health insurance. 

Three percent enrolled in Medicaid or other public insurance. 

Less than 1 percent obtained both employment-based insurance and public insurance. 

People buy individual health insurance generally because they can't get insurance from their employers, have lost a job that offers insurance, or do not qualify for Medicaid or other public programs.

AHRQ, which is part of the U.S. Department of Health and Human Services, works to enhance the quality, safety, efficiency, and effectiveness of health care in the United States. The data in this AHRQ News and Numbers summary are taken from the Medical Expenditure Panel Survey, a detailed source of information on the health services used by Americans, the frequency with which they are used, the cost of those services, and how they are paid. For more information, go to Length of Coverage in the Individual Health Insurance Market for the Non-Elderly U.S. Population, 2006, MEPS Statistical Brief 227.

Blue Shield of California Reinstates Insurance for Patients it Dropped

Karen Vincis insurer - Blue Shield

In a bid to put to rest legal troubles over a practice of canceling patients’ health insurance policies after they got sick, Blue Shield of California has agreed to grant coverage again to nearly 700 such patients.

The company will also reimburse them for medical bills they’d paid when they didn’t have coverage. The state of California, in return, dropped its case against the company and stopped its pursuit of $12.6 million in proposed fines, the Los Angeles Times reported this morning.

A number of big California health insurers got into public relations and legal messes over the cancellation of plans after patients get sick, a practice that goes by the medical sounding term “recission.” The insurers claimed the patients weren’t upfront about their medical histories and preexisting conditions when they applied for coverage.

Other companies that have agreed to reinstate patients’ policies include Health Net, WellPoint’s Anthem Blue Cross and Kaiser Permanente.

Blue Shield didn’t admit wrongdoing and, in a prepared statement, said, “With this settlement, we can put these matters to rest and enter 2009 with new procedures in place to clarify the responsibilities of insurers and our customers in the future,” according to LAT.

Some consumer advocates weren’t satisfied. Jerry Flanagan of the advocacy group Consumer Watchdog, told the Times, that the settlement “does not adequately protect against future rescissions — no admission of wrongdoing, no mandatory fines, no clarification of the legal standard” for rescissions

FACTBOX-US healthcare spending hit $2.2 trillion in 2007

Jan 6 (Reuters) - U.S. healthcare spending rose to $2.2 trillion in 2007, or $7,421 per person, an increase of more than 6 percent from the previous year, the U.S. Centers for Medicare and Medicaid Services reported on Tuesday.

Here are some facts about healthcare spending in 2007:

• Healthcare made up 16.2 percent of U.S. Gross Domestic Product in 2007.
  
•  In 2007, 31 percent of healthcare dollars went to hospitals, 21 percent to physicians and clinics, 7 percent on administrative costs, 10 percent to drugs, 25 percent to "other" and 6 percent to nursing homes.
  
•  Private insurance paid 35 percent of this; Medicare 19 percent; Medicaid and the State Children's Health Insurance Program 15 percent; 12 percent from other public funds; 7 percent from other private sources; and 12 percent was paid for out of pocket by patients.
  
•  Hospital spending was $696.5 billion while doctor and clinical services spending was $478.8 billion.
  
•  Medicare, the federal health insurance program for the elderly, spent $431.2 billion overall in 2007 while Medicaid, the state-federal health insurance plan for the poor and disabled, spent $329.4 billion.
  
•  Private health insurance premiums were $775 billion while patients spent $268.6 billion out of their own pockets.
  

Obama's Health Care Resolutions Can't Be Kept

Beware a politician’s promises.

In his pursuit of national health care reform, President-elect Barack Obama has repeatedly promised Americans two big things:

-- that if they like the health insurance they have today, nothing will change, and

-- that his health reform plan will save the typical American family $2,500 annually in health care costs.

Yet, if Obama sticks with the health proposals he has outlined so far, it is highly unlikely that either of these promises can be kept. And that’s putting it charitably.

The main problem is that Obama has proposed creating a new government-sponsored enterprise — a taxpayer-financed health plan, run by federal officials, that would “compete” directly with private health plans. Moreover, the “competition” would take place through a new “national health insurance exchange,” something the president-elect envisions as a kind of national shopping mall for coverage, managed by Washington.

Unfortunately, rigorous analysis indicates this approach would end up displacing much of today’s existing private health coverage. Millions of Americans, especially those now getting coverage provided by their employers, would lose the private insurance plans they have today.

A government-run health plan is, of course, not a new idea. A perennial favorite among “liberal” health policy wonks, the program’s most recent high-profile champions include Tom Daschle, Obama’s choice for secretary of the U.S. Department of Health and Human Services (HHS), and Senator Max Baucus, chairman of the powerful Senate Finance Committee.

In the Obama version, the new government health plan would be open to the uninsured and those ineligible for other government coverage, like Medicare and Medicaid. It would feature comprehensive benefits like those available in the Federal Employees Health Benefits Program (FEHBP), the program that covers members of Congress, federal workers and retirees.

It sounds reasonable, but there’s one little problem with using the FEHBP as a model: It offers no government health plan at all. The FEHBP promotes premium-saving competition among a wide variety of health plans, but they are all private plans, ranging from managed care plans to health savings accounts.

In the FEHBP system, all of the risks and liabilities are assumed by private-sector plans, not by the taxpayers. But under the proposed new government health plan, taxpayers would be saddled with all the risks, losses, and liabilities—just as with the recent series of big bailouts.

Worse, in the Obama version, government officials would not only participate in the national competition by entering their own plan, they would also set the rules for the competition itself. It would be like having an umpire who not only makes the calls, but also fields one of the teams on the field. Some “fair” competition.

But “fairness” is not the biggest issue. What really matters is how it would affect your health coverage.

When the Obama health plan was unveiled, the Lewin Group, a nationally respected and politically independent econometrics firm based in Virginia, put it under the microscope. Their October 2008 analysis estimated the plan would help 26.6 million Americans gain health insurance coverage. A good thing, to be sure.

But Lewin concluded that the proposal would produce some very unpleasant changes, as well. Many employers would stop offering private coverage, switching an estimated 18.6 million employees over to the new government plan. Overall, Lewin estimated, 21.6 million Americans would lose their existing private health coverage, while the ranks of those insured by government (i.e., taxpayers) — under Medicaid and SCHIP, as well as the new plan — would swell by an estimated 48.3 million. These are bad things.

More recently, in a special Capitol Hill briefing, the Lewin Group unveiled an updated analysis of the government plan, based on different design elements. They projected that the loss of private health insurance coverage could range from a low of 10.4 million to a high of 118.5 million, depending on such factors as the pool of eligible enrollees and the kind of payment rates adopted by the new government plan.

Employers make the key decision to keep or dump health insurance; employees have little or no say in that decision. That’s why no one can promise that “nothing will change” for individuals and families who like their existing coverage.

President-elect Obama promised many changes. But in health care, he promised that change would ensure patient choice of doctor and care, without government interference. He also promised that (1) those who want to keep their current coverage would have no problem doing so and (2) those without coverage would get the same kind of insurance available to members of Congress. These are wonderful promises. But they can’t be kept with the approach he has suggested taking.