FW: FW: [Winona] Re: Health Insurance costs

[Paul Double]

Terri and others   Lots of question so little time In 1936 the Robinson-Patman Act was created to provide fair pricing between competing businesses. It was followed in 1938 with the Non-Profit Institutions Act.  See attached   http://www.lawmall.com/rpa/rpadrugs.html   The intent of the Robinson-Patman Act was to eliminate unfair pricing policies between competing entities. It was enacted to stop vendors from agreeing not to sell products or services to a competitor of their customer thus directing the business to one seller enabling them to set prices since competition is not allowed to take place.  While this is a simplification of the law it was designed to open markets and competition thus providing the public with lower prices.  Non Profits, such as hospitals, as an example can purchase drugs used within the hospital for less money than your local drugstore even if they are 50 feet away and the same drug etc.  While that may make sense to some the non profit exemption has been miss used to provide discounts to insurance companies, Medicare and others which compete but not under the same pricing rules.  Thus cost shifting occurs and those who can pay may do so at such a premium over what someone else just because their insurance company has driven a harder bargain on the threat to the Hospital or clinic that they would be out of their network if they didn’t cave in to the price concessions or refuse to provide similar prices to that insurers competition.   This then leads to the control of the healthcare market as “their network” is reinforced by them undercutting the policy premium, locking in employers, forcing providers to give them special deals, on the intimidation that they may set up their own clinic and to force the market to be owned by them.  Once competition has closed their doors they can then raise premiums, further cut or delay provider payments as they own the check book on the market.   When providers ban together to fight the insurance companies they tend to collaborate (fix prices) which is illegal and will get them is serious hot water. There is lots of information on this at the FTC Federal Trade Commission website.   When providers do not offer their lowest negotiated prices to all competitors they collude with the negotiated party to control who will do the business and what we all will pay since we are forced to buy the policy to get the discount, then forced to use their providers to get the price.  That what the Robinson-Patman Act Prohibits and why it is law and why it is important.      -----Original Message----- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED] On Behalf Of terri hyle Sent: Saturday, September 13, 2003 9:22 AM   Paul, I need to confess a great deal of ignorance.  I have no idea what or whom you mean by 'non profit providers'.  Are you talking doctors?  Hospitals?  Clinics?  How do non profit providers come under the FTC or the Robinson Patman Act? _________________________________________________________________________ Are you also saying that group plans are more expensive than individual plans?   We have not yet found a Small Business Group Plan, and we have first hand knowledge of many, that have been priced lower than individual policies with the same benefits and employee pool.  Remember that in Minnesota MCHA is available to anyone in a group who is denied individual insurance because of health related problems.   There are but two issues in healthcare when you sort it out. 1— The price we pay must provide a fair profit for the providers 2- The ability to pay and what is affordable for the least of our brothers or sisters.   The Robinson-Patman Act enforced or price controls solves number one.  A government subsidy is the only thing that solves number two.  It is that simple or politically complex.   If insurance is the problem, what is the answer for those who incur large medical expenses?  See MCHA if you believe you must have group insurance to have insurance. __________________________________________________________________________ Or, for low wage earners, ordianary, but routine medical costs (strep throat leaps to mind here, but could be badly sprained ankle, etc.)?  A government subsidy is the only way __________________________________________________________________________    Do you think we'd be better off without insurance?   Yes Medicare contracts with “private companies” to process their paperwork and those companies are able to make a profit. Private companies can process payments to providers efficiently and for about three percent.  To the best of my knowledge there are no insurance companies, profit or non profit(ha), who operate on that margin today.  That cuts healthcare cost by 9 percent assuming the insurance companies’ numbers are correct when they claim they pay out 88 % of their revenues in claim payments.   Let me plant this seed for the discussion -  What for profit industry, processes payments the most efficient, is in almost every community in the nation and has been empowered by congress to take on the insurance industry as a direct competitor?     Paul Double