Smoke Them If You Can Get Them

Premium cigars, and the people who make them, may be going the way of the health insurance agent. DC has decided to extend regulatory oversight of the tobacco industry in a way that will significantly impact many aspects and effectively drive many small business owners to close their doors.

Under the guise of paternalism, the federal government claims they are looking after the welfare of the citizenry.

The true goal is an attempt to raise taxes incognito and create another windfall for the bureaucracy. It is quite possible the opposite will occur and tax collections will be negatively impacted or neutral.

Let me say this post is not a personal vendetta. I don't use tobacco of any kind and have no horses in this race. While this is a non-insurance post on an insurance website, this venue has also covered topics relating to government overreach, especially when it comes to Obamacare.

First, a bit of history for background purposes.

In 2000 the U.S. Supreme Court ruled in favor of Brown & Williamson's suit against the FDA. The decision handed down by the high court essentially said the FDA did not have regulatory authority over tobacco.

Within weeks of this ruling, FDA revokes its final rule, issued in 1996, that restricted the sale and distribution of cigarettes and smokeless tobacco products to children and adolescents, and that determined that cigarettes and smokeless tobacco products are combination products consisting of a drug (nicotine) and device components intended to deliver nicotine to the body. - FDA

I am not a lawyer but it seems as if the FDA thumbed their nose at SCOTUS and used a fallback position to circumvent the ruling and do what they wanted anyway.

And more overreach was to follow.

President Obama signs the Family Smoking Prevention and Tobacco Control Act into law.  The Tobacco Control Act gives FDA authority to regulate the manufacture, distribution, and marketing of tobacco products to protect public health.

FDA Center for Tobacco Products established.

FDA announced a ban on cigarettes with flavors characterizing fruit, candy, or clove.

As far as we know the president never gave up his promise to quit smoking.

He also promised to make health care affordable for everyone.

In May of 2016 the nicotine police took steps to expand their territory per this article from Reason.

Although yesterday's announcement that the Food and Drug Administration (FDA) will start regulating e-cigarettes is getting the most attention—Reason’s Jacob Sullum explains why this is awful news for vapers—the agency’s new deeming regulations also have huge implications for the cigar industry.

The threat of FDA restrictions have loomed over the cigar business ever since the FDA took control over cigarettes; yesterday morning, the other shoe finally dropped.

The worst fear of cigar manufacturers and smokers alike has been that the FDA will impose the same onerous pre-market review requirements on cigars that it currently places on cigarettes.

The progression so far has been to regulate and restrict the sale of tobacco products in any form but has also opted to tell the tobacco industry how they can and cannot design their product. By banning flavored tobacco DC has shown the same disregard for industry that Obamacare did by deciding the type of product the health insurance industry can and cannot offer their customers.

Candy flavors in tobacco are restricted but menthol is apparently not a flavor. Apparently rum flavored cigars as well as "sweet" flavored tobacco used in pipes (Cherry Blend) and cigars (Swisher Sweets) are allowed as long as children are not around.

One of my uncles was a pipe smoker and I loved to be around him when he enjoyed his evening puffs of Cherry Blend tobacco.

Of course I also rode in cars that didn't have seat belts and fearlessly rode my bike without a helmet.

More on the march of the tobacco Nazi's in a later post.


#TobaccoRegulation #Obamacare #FDA

Precision Cannon Fire

As we noted a week ago, some Grand Canyon State citizens are going to have a problem this November:

"People in Pinal County are at risk of a health insurance problem that hasn't happened anywhere else in the country: no companies offering marketplace health insurance"

Turns out, Aetna was the sole remaining carrier on that state's Exchange, and they've bailed. That means that, if you live in Pinal County (home of the Boyce Thompson Arboretum) and you want to buy health insurance, you'll have to buy if off the Exchange.

Which also means you get to pay full-freight: no subsidies for off-Exchange plans.

And that most likely means you'll be faced with plans that are unaffordable. No problem: the ObamaTax makes provision for such circumstances, and offers an exemption for folks who can't afford premiums.

Except there's a pretty significant, but under-the-radar, catch: this exemption won't be available to the folks in Pinal County.

Why not?

Well, as FoIB Michael Cannon explains, "[t]he unaffordability exemption applies only if “the annual premium for the lowest cost bronze plan available in the individual market through the Exchange” is unaffordable." But there are **no** plans on the Exchange.

See the problem?

Read the whole thing, you'll be glad (and/or furious) that you did.

Medical Necessity: Here we go again

If you want to understand why your rates keep going up, you can lay a big chunk of the blame on items like this (in email from Medical Mutual this morning):

"To be compliant with the non-discrimination rule outlined in the Affordable Care Act (section 1557), we will remove broad exclusions for gender transition treatment"

Let's dial back a bit, and talk about why this is so stupid. In the earliest days of this blog, we participated in a discussion with other bloggers about medical necessity and In Vitro Fertilization (IVF). We averred that:

"[A]ccording to the standard industry definition, “medical necessity refers to treatment which is required to treat or care for symptoms of an illness or injury or to diagnose an illness or condition that is harmful to life or health.” Thus, we see that IVF fails to meet the threshold of “medical necessity,” ergo it should not be covered by insurance."

That is, no one has ever died because they couldn't/didn't get pregnant. Likewise, there is no evidence that anyone has ever died because they didn't get their personal bits chopped and/or replaced (excluding obviously medical issues like cervical or breast cancer and the like). There is, however, ample evidence that these folks are at much higher risk for attempting suicide (which would then require medical treatment in the most expensive part of the hospital).

So when insurers are forced to pay for non-medically necessary procedures, that cost is going to be passed along in the form of higher insurance premiums. Now, am I blaming Medical Mutual for this change? Of course not, they're simply following directives sent down from Our Betters in DC©.

What choice do they (or any other carrier) have?

It's not rocket surgery, after all.

More 3000% rate decreases

This never gets old:



So two more individual medical renewals hit my desk this morning. Both are with the same carrier, both are HSA-compliant with $3000 per person deductibles then 100%, both are grandmothered (meaning they're only partially ObamaCare-compliant, but still "kosher") [ed: for now]:

Sally and her family of four currently pay about $930 a month; their rates are going up 15%, to $1,065 per month. This means that the family will spend just shy of $13,000 before the plan pays bupkes.

Still, that's a bargain: a comparable fully compliant plan will set them back about $1200 a month, and that's with a $6500 per person deductible. So they'd have the privilege of more than doubling their medical expense out-of-pocket while paying only 20% more in premiums.

Such a deal!

Terry's increase is 17%, from $295 a month to about $350. That's also still a bargain: a comparable new plan goes for $480 a month and also comes with a $6500 deductible. This means that Terry would be out almost $11,000 before the plan paid a dime. Well, except for pap smears, mammograms and birth control convenience items. Oh, did I mention that Terry's a 53 year old guy?

And they're the lucky ones.

Insurance working properly, Wellmark-style

They say that "the exception proves the rule," and I think that FoIB Allison Bell has found the exemplar:

"Wellmark Blue Cross Blue Shield of Iowa says it spent $18 million on medical bills for just one patient in 2015."

And that's just from July forward. The patient suffers from a ""severe genetic disorder," and is racking up about $1 million a month in claims. In fact, this one insured accounts for some 10% of the almost 43% rate hike Wellmark's seeking for 2017. As this is a fully compliant ObamaPlan, there's no end in sight, since there's no cap (aka "lifetime maximum").

So why do I call this "insurance working properly?"

Well, because insurance should be about spreading the risk (and the pain). And this certainly qualifies: no average person could afford this kind of health care spending on his own. And since it's a genetic disorder, I don't feel any moral qualms as I would for someone with a lifestyle-related condition. This is simply the hand that this person was dealt.

And yes, it's a lot of money, and money means resources, being spent on one person. My faith requires me to "choose life," and that's the over-arching sentiment here. It's not for birth control convenience items or routine expenses, it's for a catastrophic claim, what health insurance should be about.

May this poor soul find a path to healing.

Mid-Week Linkage Roundup

■ From the "Everything Old is New Again" Department: My late mother had Post-Polio Syndrome, a result of childhood exposure, but (thankfully) she never had the full-blown version of the dread disease. A common treatment for those that did was the so-called "iron-lung." Fortunately, we've long since eradicated polio, but FoIB Allison Bell warns that we may have to dig those old machines out of mothballs:

"Zika May Be Polio All Over Again ... the CDC concluded, “after careful review of existing evidence,” that “Zika virus is a cause of microcephaly and other severe fetal brain defects” in newborn infants."

Heads' up.

■ Co-Blogger Mike thinks that Belgium might be catching up to Sweden in the Bizzaro World medical tourism race:

"Euthanasia tourists are flocking to Brussels to get a lethal dose. Doctors at hospitals and clinics at Belgium’s capital are seeing an increase in number of euthanasia tourists who are travelling from across the world"

Supply and demand.

■ FoIB Jeff M first alerted us to troubles brewing for North Carolina's Blue Cross franchise back in May. Today he shares this update in the continuing saga:

"The N.C. Department of Insurance announced Monday it will broaden its investigation into Blue Cross and Blue Shield of North Carolina, citing “disagreements” with the insurer."

At issue are continuing IT and claims processing issues.

Gotta love the tech.

■ And finally, via FoIB Holly R, this sad (and highly unusual) case from Great Britain (and for once, it's not about the MVNHS©):

"[A] 61-year-old British bagpipe player who developed a dry cough and breathlessness that worsened over a period of seven years ... He died several weeks after entering the hospital"

Turns out, several different - and deadly - fungi had taken up residence in his bagpipe, which he had neglected to clean. Truly sad, but perhaps a helpful warning to fellow pipers.

Death by Amazing Grace?

Tick-Tock: Welcome to the Walmart Marketplace

As we noted earlier this month, agents have the opportunity to sell ObamaPlans at Walmart stores around the country. But the window for signing up to do so is closing.

From email:

"Tomorrow (August 31) is the last opportunity for agents and brokers to sign up to enroll consumers in Marketplace plans in Walmart stores.

In order to participate in this Walmart event, you must hold a valid state license and be trained and registered to participate in the Marketplace for 2017."

Interested? Then click here to get started. And any readers that do choose to participate are encouraged to let us know what you think of the experience.