PeachCare Woes

PeachCare, the state's health insurance program for children, could run out of money well before the middle of 2007 without a new infusion of cash from either Congress or state lawmakers. And, under new federal rules, the state may have to start putting big money aside to ensure it can pay for the health care of retired teachers and state employees in coming years.

This is a STATE run program. Why does GA need funds from taxpayers in OTHER STATES to support a GEORGIA program?

States are facing shortfalls because they are insuring more children while available federal funding has not kept pace.

So it is the fault of the FEDERAL GOVERNMENT for the shortfall in funds?

PeachCare insures families with incomes of up to 235 percent of the federal poverty level, or about $47,000 for a family of four.

Sliding scale health insurance for family incomes up to $47,000. Any wonder why this program is running short of money?

"If the feds don't fix it, it's a serious, serious problem," he said.

I am still having trouble agreeing with this being a FEDERAL GOVERNMENT problem.

Georgia created the program. Why is the federal government being asked to fix a Georgia problem?

What am I missing?

Insurance Dispatch

In this week's column, we discuss wellness programs, which just got a nice boost from the Fed�s.

Available now at The Medical Blog Network.

% Returns, as at 29 December 2006

Globe Investor, 29 December 2006

Submissions Due...

For next week's CoR (#16!), hosted by Jason Shafrin, the Health Care Economist.

Please submit your entries (or one you like from someone else's blog) by Monday (the 1st):

� via email

or

� at Blog Carnival

PLEASE include:

? Your blog's url
? Your post's url
? The trackback url (if applicable)
? A (brief) summary

NB: We're still looking for hosts. If you'd like to host a future edition, just drop us an email.

Introducing Mr Mike...

Mike Feehan, that is, the newest member of Team IB. A graduate of Washington University in St Louis (both Bachelors and Masters), Mike�s worked for 3 major insurance carriers, from entry-level to Senior VP. He�s also been a benefits consultant, and manager of benefits for a plan that included some 30,000 employees, over half of whom are outside the US.

Most importantly, however, he is a lifelong Cardinals' fan, and sold beer at Busch Stadium for several years.

Mike�s resume includes stints as an Aetna VP, as Chief Underwriter for Empire Blue Cross, and as a benefits consultant for Willis of New York. It�s really too bad that he can�t seem to hold down a job.

He currently works for a prominent international organization, which must remain nameless (you read about it every day and wouldn't have any trouble guessing its identity). One thing we can tell you, though, is that Mike brings a wealth of information and insight to our blog, as well as a new perspective: Bob, Bill and I are all agents; it�ll be nice to have a knowledgeable and experienced viewpoint from someone who�s got a different outlook. And being in the Northeast, Mike helps us round out our geographic diversity, as well.

We�re looking forward to working with Mike, and wish all our readers a Happy, Healthy and Prosperous New Year!

UHC Takes a Hit...

Our friend Joe Paduda is no fan of UHC�s executive stock plans, and since he�s on vacation this week, we�ll take up the slack. The Securities and Exchange Commission (SEC) has now launched an official investigation into UHC�s stock option plans. The company says that it�s cooperating with the Fed�s, which should set everyone�s mind at ease.

You may recall that, a few months ago, United�s Dr. William McGuire resigned as Chairman of the Board following a review of his stock options. The company itself also took some financial hits as a result.

Greed, of course, is not the exclusive province of insurers, but this time of year, with so many employers facing double-digit renewals, it sure looks bad when the carrier exec�s get caught with their hands in the cookie jar.

Does She or Doesn�t She�

Well, I don�t know about her hair, but I can make a pretty good guess about her insurance: nope.

Okay, let�s go back to the beginning, and work our way forward.

I occasionally receive calls from distraught folks who are unhappy with their insurance coverage (generally, it�s because they think it�s too expensive; sometimes it�s because they got bad service). Such was the case today, when Melody called with a problem: she�s had an HSA for several years now (well, it started life as an MSA, but evolved along the way). Her agent has left the business (a not unusual occurrence), and the carrier�s home office staff has been, according to Melody, less than helpful. In the meantime, her premiums have increased to unacceptable levels, and she�d like to switch.

Hey, we�re here to help.

So I ask the normal questions (height and weight, tobacco use, some health questions). She seems fine, if a bit plump (not that I should talk, of course). Nothing that should cause a problem though, so I start asking her questions about her plan, what she likes and what she doesn�t like about it. I then suggested a certain carrier, and she quickly (and firmly) told me not to bother with them: they declined her several years ago.

Um, I thought you told me that there were no health issues?

There aren�t, Melody reassured me, just a rare genetic blood condition.

Oh, is that all? Golly, that shouldn�t be too much of a problem; after all, your current carrier took you.

You what?

You don�t think they asked if you�d ever been turned down for insurance, and why?

I see. And you didn�t bother to tell them?

Uh hunh.

Well, I happen to represent that carrier as well, and I can assure you that they did, in fact, ask if you�ve been declined. So you submitted a fraudulent application. Well, let�s see if we can get you back on the right side of the track now, with a carrier that knows your complete history. As it is, you don�t really have insurance now, so it seems a shame to pay even more for it.

I beg your pardon? You do have insurance now; if you break your leg the blood part doesn�t matter? Okay, well, it�s really not my job to argue with you, so I�ll check around, see if there�s any carriers that will offer you coverage, and get back with you as soon as possible.

Happy Holidays to you, too, ma�am, and PLEASE stay well.

LinkFest Tuesday

This week's Carnival of the Capitalists is hosted by Elisa Camahort at Worker Bees. She actually posted it a day early, but I missed it (for shame!!). It's a good one, too, with almost 3 dozen posts, each one with helpful context.

Grand Rounds instigator Nicholas Genes presents this week's edition. Over 30 bloggers submitted their favorite posts, and explained what made them so special.

UPDATE: The Carnival of Personal Finance is now up over at My Personal Finance Blog. The host has pulled together more than 60 entries, in a half dozen categories. Nice job!

Peace

Insurance Dispatch

While we're all celebrating the joyous Holiday Season, it's important to remember that not everyone is "naturally" so joyous.

In this week's column, we learn that cough medicine isn�t just for coughs anymore. Are your kids safe?

Available now at The Medical Blog Network.

BMO CM on Life Insurance Cos

BMO Capital Markets, 20 December 2006Consolidation Paying Dividends - Three Years After Consolidation: Market Shares Concentrated & Higher Operating MarginsExecutive Summary:Harvesting Earnings from CanadaThe Canadian life insurers are by and large global companies. Nevertheless, earnings from Canada represent 25-100% of each company�s profits and for all, except Manulife, Canada is the biggest

BMO's Downe to Split Time Between Chicago & Toronto

Bloomberg, Doug Alexander, 21 December 2006William Downe, Bank of Montreal's next chief executive officer, will split his time between Chicago and Toronto, becoming the first Canadian bank head in about 65 years to have a base on both sides of the U.S. border.``Bill will spend his time where the business requires him to be,'' bank spokesman Paul Deegan said in an interview. ``Having lived and

Thursday News Briefs�

As we�ve written about more than once, so-called �health discount programs� can create more problems than they solve. And because they are NOT insurance products, the Department of Insurance (well, the Ohio DOI) has been powerless to stop them.

Until now, that is:

Ohio has joined a growing number of states which have empowered Insurance Departments to impose � and enforce � new rules on these plans. The Ohio House has passed, unanimously, their version of Senate Bill 5, which sets requirements for discount medical plans, including minimum marketing standards.

Unfortunately, SB 5 also includes enabling language for so-called �Healthcare Purchasing Alliances,� which have their own problems. We�ll have more on this soon.

While we�re on the subject of �ways to make insurance more expensive:� the Ohio House has also passed a mental health parity bill, which would require insurance companies to cover mental illnesses as they cover physical ones. Another word for this is �premium increasing mandate;� lame duck Governor Taft hasn�t announced yet whether or not he�ll sign it into law.

And finally, as long as we�re here in the Buckeye State (home of Heisman Trophy winner Troy Smith), there�s some interesting life insurance news, as well: Western-Southern Life has introduced an unemployment rider, available on many of its term plans.

The rider, which adds about 3% to the premium, is a waiver of premium benefit which is expected to help those who�ve lost their jobs keep their insurance.

UPDATE FROM BOB: Scam alert - Phony health coverage.

Sticky Fingers

According to a recent Harris Interactive poll, employees have sticky fingers when it comes to employer provided health insurance.

According to the poll, 89% feel very or somewhat confident their employer sponsored health insurance will meet their needs during the coming year.

Surprisingly, only 34% expected their share of health insurance premiums to rise over the next 12 months. Must be folks who work for generous employers.

Even more surprising is the low number (17%) who are enrolled in either an FSA, HSA, HRA or other spending account and only 6% will be enrolled in the HSA or HRA. Granted, the FSA has a bad rap for the "use it or lose it" rules, but why would consumers of health care fail to take advantage of tax favored accounts?

Perhaps when it comes to health care, consumers would prefer to be spenders, as long as it is someone else's money, rather than savers.

Cavalcade of Risk #15...

When we started the CoR a little over 6 months ago, it seemed a calculated risk that we'd last this long. We've got hosts scheduled up through mid-February now (hey, that reminds me, how would you like to host an upcoming edition?), which seems to mean that that risk paid off.

So, take a break from that last minute shopping, sit back, and enjoy the show. And a great big Thank You to everyone who submitted, and a few who didn't (but got included anyway):

� You�ve heard of soft water, but how about Hard Money? Joshua Dorkin, blogging at Real Estate Investing For Real, explains how some lenders use an imaginative technique to help folks secure loans.

� Joe Kristan, of Roth & Company, explains some of the �useful changes to the HSA rules." Using them can help reduce your risk of spending too much on health care.

� The PC-Doctor prescribes a dose of common sense: reusing passwords can be dangerous to your (computer's) health!

� Think you�re paying too much to insure your car? Chuck Russell has 15 ways to help you lower your car insurance.

� The folks at VitaBeat warn that young men face a greater risk of high blood pressure than their female counterparts. As a former teen-age boy myself (a LOOONG time ago!), I'm tempted to say "dunh!"

� Klik Money reports that something as simple as a health risk assessment can help lower your medical bills. Good advice!

� The unfortunate plight of CNET editor James Kim has some lessons for the rest of us. Pro Bargain Hunter�s Yan has some helpful tips on preparing for the worst.

� Think your identity is safe? Do you get credit card offers in the mail? Wenchypoo warns that if the answer to both of those are �yes,� you may have a problem.

� Last week, she hosted the Health Wonk Review; this week, Rita Schwab has some pointed questions about the redundancy of the current physician credentialing system in the US. Don�t miss the comments.

� Great news! If visions of (chocolate covered) sugarplums are dancing in your head, Mombian reports that chocolate may reduce the risk of miscarriage.

� What�s a modern day Jack the Ripper got to do with risk (other than the obvious, if you�re in a certain line of work)? Renthusiast wonders why the ubiquitous London surveillance cameras weren't a show-stopper.

� Hedge Funds are mysterious, and potentially risky, vehicles. Find out why Mister Juggles loves �em.

� Since it's such a hot topic these days, here's one more on identity theft. The Identity Theft Fixes blog has a cautionary tale about a simple printing error that could have dire consequences.

� No need to grab a shovel: Paul�s Tips has some advice about cutting your losses.

� Jon Coppelman at Workers Comp Insider has a great post on navigating the hazards of the ADA (no, not that ADA!)

� And finally, Yours Truly responds to a commenter�s puzzlement over the difference between luck and risk.

Our next host will be Jason Shafrin, the Healthcare Economist, on January 3rd. You can find the new Winter Schedule (and any changes) at the Cavalcade homepage.

NBF Upgrades Manulife & Scotiabank

National Bank Financial, 19 December 2006With the lifeco & bank earnings seasons now complete, we are making several changes to our ratings. In general, the changes are related to valuation. Given we employ sector ratings, and as a result, rate our companies (both banks & lifecos) against one another, changes in relative valuation are frequently the most significant reason for our valuation

Canadian Banks are Absent in the World Stage

Financial Post, Duncan Mavin, 19 December 2006Global banking chiefs hungry for growth and armed with cash to burn are set to make 2007 the international year of the bank merger. The trend will lead to further concentration of international banking power, dwarfing those banks -- such as Canada's domestic banks -- that don't participate in the biggest mergers.Transactions will be driven by healthy

CIBC Sees No Significant Revenue Hit from Trust Ruling

Financial Post, Peter Koven, 19 December 2006 Canadian Imperial Bank of Commerce does not expect a "significant" revenue hit due to the federal government's crackdown on income trusts, the company revealed yesterday.The announcement came in the bank's accountability report for 2006, which was filed with regulators as part of its Annual Information Form.The decision to tax income trust

Carnival Monday!

I'm ambivalent about this week's Carnival of Personal Finance: on the one hand, it's simply a list of posts, with no clue (other than titles) as to content. OTOH, I'm empathetic to the folks at A Penny Saved (after all, this week's Cavalcade of Risk is here at IB); still, I wonder if there isn't some happy compromise available.

In the event, you can't go wrong with Joe Kristan's tax-oriented guide to gift giving.

Happily, Jeff Cornwall has an outstanding, Christmas-themed Carnival of the Capitalists. With over 40 posts, including summaries and some (cute) comments, this makes a great gift.

Happily, Wenchypoo has a thought-provoking article on those ubiquitous year-end bonuses.

Insurance Dispatch

In this week's column, we examine how to enhance the holiday experience using your Flexible Spending Account.

Available now at The Medical Blog Network.

Happy Chanukah!

May the light of the season illuminate and warm the hearts and homes of all our readers.

UPDATE: And yes, they do taste as good as they look.

Wydening Gyre

In the pre-blog world, Senator Ron Wyden�s health care bill, the Healthy Americans Act, would be just another pie-in-the-sky version of HillaryCare, and would be consigned quickly to oblivion. It is, after all, based on flawed premises and suspect assumptions (which is not to say that it�s entirely without merit; more on that in a bit).

But a funny thing happened on the way to the backbench: Senator Wyden recognized the burgeoning influence of the blogosphere, and its ability to both shape and publicize the debate. As I remarked to the Senator, I have long envied my colleagues in the political blog world for their growing access to key political decision-makers and players.

But hold on a minute, Prof, what do you mean �as I remarked to the Senator?" Since when do members of congress discuss things with you?

Earlier this week, the Senator�s office sent out an email announcing his bold new health care initiative. Among the recipients were both myself and Bob, as well as (one supposes) several thousand of our colleagues. I responded by asking for an interview; turns out, he�d already anticipated such invitations, and had arranged for a conference call with a dozen bloggers from the �health policy wonk� side of the blogosphere. Bob was unavailable for the call, but I was able to participate. Also attending were such medblog luminaries as Joe Paduda, Matthew Holt and Ezra Klein, along with several other interesting bloggers, including econblogger Max Sawicky. Most everyone, myself excluded, were proponents of either single-payor or universal coverage systems, and were quite receptive to the Senator�s plan.

On the face of it, the bill offers a lot of bang for the buck. For one thing, it phases out employer-based health insurance. I�m all for that, with some caveats. For another, it appears to recognize the value of the �private� (i.e. non-government program) insurance channel.

There are, however, two fundamental flaws in the proposal:

First, it relies on a model called �Community Rating.� Basically, CR is the health insurance equivalent of �pay at the pump� auto insurance. It sure sounds nice: everyone pays the same rate, simple to administer, universal coverage (every car needs gas, right?). The problem is that not every car is the same, and not every driver has a flawless record. Same with health insurance: absent underwriting, folks who routinely run (and win) 26 mile marathons would pay the same as obese folks with diabetes. Thus, everyone ends up paying more.

The second problem is that it relies heavily on prevention to hold down rising health care costs. There are, for example, tax incentives for parents to have their kids vaccinated. While prevention issues are, of course, important and helpful, they are not going to significantly hold down the rising cost of health care. As one of our commenters has previously noted, �(I)f health care were not expensive, health insurance would not be expensive. If the cost of health care were not rising the cost of health insurance would not be rising.� There is precious little in this bill that addresses this basic problem.

And there�s this: the bill is touted as having bipartisan support, as well as support from various union leaders and titans (or at least captains) of industry. But, as usual, no one who actually works in the insurance field was involved. Rather like assessing how to get the car running better, but eschewing the advice of the mechanic. That is, we�re the folks who actually see how this stuff works, and doesn�t work, in the real world. We understand that study after study has shown that 85% of insureds are satisfied with their coverage. We also understand that mandatory coverage is no panacea (why don�t auto insurance rates go down every year?). The only insurance industry �representative� involved in putting this plan together was the president of Oregon�s Blue Cross/Blue Shield. Small wonder, that: who else is going to administer the plan (and reap the financial rewards)?

I would urge IB readers to check out the reports of the other attendees; each one of us had, of course, our own agenda and biases, as well as our own conclusions.

My own take is that this bill, while interesting in itself, is unlikely to get much traction. There are just too many problems with it, not the least of which is its unfavorable propensity to look like the Medicare D debacle writ large(r). That is, while it may look good on paper, the reality is that it will lead to a rapid increase in health insurance costs, while doing very little to rein in health care costs.

What did impress me, however, is that Senator Wyden was perceptive enough to understand that, by taking his case to the blogs, he gets a built-in publicity bump, with (mostly) favorable reviews. Thus, his bill will enjoy an immediate advantage over others that come down the pike. And he wasn�t afraid to engage in a bit of friendly debate with yours truly; he asserted that community rating would hold down insurance costs, and opined that cost-shifting from the private sector to the government was a major reason for high health care costs.

I pointed out that he had both of these phenomena bassackwards; that is, community rating increases premiums, and that the gummint�s cost-shifting habits (especially Medicare�s) unnecessarily increase costs. His answer was, unsurprisingly, to try to water down my point by saying that all sectors shift costs, which (for some unknown reason) somehow increases costs to the others. I found his arguments unpersuasive, but appreciated his candor and enthusiasm.

This was a tremendous opportunity, and I thank the Senator for sharing his time and insights with us. Hopefully, other congresscritters will follow suit, and we�ll have more such opportunities. If nothing else, it shows that medblogs are quickly coming into their own.

Merrill Lynch on Banks

Merrill Lynch, 14 December 2006; The following is the first 2 pages from the reportEconomic growth likely to slowOur forecast of a marked slowing in US consumer spending growth dominantly accounts for our projected decline in Canadian overall GDP growth from the 3.0% average over the past three years to 2.1% in 2007. The channel through which that weaker US demand is likely to hit Canadian growth

Oh Really??

We can resolve the high cost of health care and the low rate of insurance coverage in one easy step.

We just have to allow interstate commerce.

So THAT'S how it is done.

Under these mandates, certain items have to be in your policy whether you need them or not.

By allowing people to hit the Internet and look at other states' policies, we can reduce our cost by 70 percent.

70% huh?

So, according to this theory, individuals whose coverage is not subject to state mandates can save 70%, right?

If that is so, why then do companies like Coca-Cola, Home Depot and others whose plans are not subject to state mandates pay as much, if not more, than individuals do for similar benefits?

Something is terribly flawed here. I suspect it is a much misinformed journalist who really does not grasp the dynamics of health insurance pricing.

Calling all Wonks...

For the Health Wonk Review, available now at the MSSP Nexus blog. Hostess Rita Schwab presents an all-star round-up of over 20 thought-provoking posts.

Marcus Newberry, writing at Fixin' Healthcare, has an interesting piece on risk, and the problem-oriented nature of our health care system.

A Different Kind of HRA

The soaring cost of health insurance is prompting more and more U.S bosses to carry out checks on their employers (sic) to gauge how healthy they are and whether they may be at risk of getting ill in the future.

Research from consultancy Watson Wyatt Worldwide has concluded that the number of U.S employers carrying out "health risk assessments" (HRAs) on workers will rise by more than a fifth next year.

Employer health checks. And you thought they were just showing compassion for your health.

Already two thirds of U.S employers offer HRAs, with many linking participation to incentives, such as reduced healthcare plan contributions or free gifts.

The health and wellbeing of workers is becoming an ever more pressing issue for American bosses, particularly against the background of rising healthcare costs, increasing levels of obesity, an ageing workforce and a crisis in pension and retirement provision.

There is no question, the vast majority of what ails us, both young & old, is preventable. Diet, lack of exercise are certainly primary contributors to poor health. But according to some, so is good oral hygeine.

Recent studies claim that 85% of those who suffered a heart attack had some form of peridontal disease. Personally, I always floss after having a double cheeseburger and onion rings.

When was the last time you did a health assessment? Your life, as well as your wallet, could depend on how well you take care of your body.

UBS Says Banks & Life Insurance Cos Fully Valued

Financial Post, David Berman, 13 December 2006Canadian financial stocks have been on a tear in 2006, especially after the downfall of income trusts sent money flowing into the high-yielding sector. Now, Jason Bilodeau, an analyst at UBS, is less enthusiastic.In a note to clients this week, he lowered his recommendation on Industrial Alliance and Sun Life Financial (once his top pick) to "neutral"

Toys for Tots

You can make a difference.

For every doctor review posted at Vimo a dollar will be donated to Toys for Tots.

Helpful HSA News...

From the fine folks at Colorado Health Insurance Insider, a helpful compendium of what's (presumably) in store for 2007 and beyond.

And FoIB Joe Kristan, who blogs at Roth & Co, has even more.

Grand Rounds

A very full 'Rounds today, with almost 30 entries, all professionally put together by the folks at TreatmentOnLine. Each post has thoughtful and incisive commentary, as well. Bravo!

FoIB David Williams, proprietor of the Health Business Blog, puts the lie to those who claim that the rich and powerful receive better health care. Thought-provoking piece.

Fund Managers on Cdn Banks

The Globe and Mail, Dale Jackson, 12 December 2006Peter O'Reilly isn't waiting for the market to tell him Canadian banks can no longer live up to investor expectations. The Dublin-based manager of the Investors Global Financial Services fund has been trimming his Canadian bank stock holdings for the past few weeks.The fund's exposure to the Canadian financial services sector -- which includes

Banks Q4 2006 Summary

Report on Business Television, 11 December 2006Click here for the ROBTv video clip, of Jamie Keating (Senior Bank Analyst, RBC Capital Markets) speaking about the Banks' Q4 2006 Earnings.__________________________________________________________ RBC Capital Markets, 11 December 2006� Banks Beat Consensus, But Quality a Concern for Some. The banks delivered 17% EPS growth YoY, led by CIBC up 40%

Legislative Update

The lame duck congress just wrapped and here are some items of note.

In lieu of a proposed 5.1% reduction in Medicare reimbursements to physicians, the rate will be the same in 2007 as 2006. While this is not great news for docs who treat Medicare recipients, it is better than the cut.

We believe this will still have a negative impact on the number of docs willing to see new Medicare patients.

And this . . .

"Republican lawmakers, with little public debate, quietly added a billion-dollar" provision to the bill to encourage the use of health savings accounts, the Post reports (Birnbaum/Montgomery, Washington Post, 12/11). The legislation would eliminate a requirement that annual contributions to HSAs not exceed the amount of the annual deductibles for the health plans to which they are linked. "Many people with HSAs have health insurance deductibles at or near the minimum required to set up the accounts -- about $1,000 or $2,000 a year," but the bill would increase the maximum annual contribution to $2,850 for individuals and $5,650 for families, the Journal reports.

Given the fact that a high number (somewhere around 80% is my recollection) of HSA's have $1000 or less in them, I doubt this will have much of an impact.

Money Monday!

Kirk Walsh presents an excellent Carnival of Personal Finance. With almost 60 entries, all neatly categorized and most with helpful comments and context, it's a great pre-holiday treat.

Joe Kristan has an interesting post on the AMT (Alternative Minimum Tax) that helps explain that arcane little tax nugget.

This week's Carnival of the Capitalists is also pretty jam-packed, with some 40-plus entries, hosted by Sama Blog. I was a bit disappointed to see that it's basically just a list of posts, with no particular rhyme nor reason.

This one caught my eye, though, because it succinctly and accurately explains how liability insurance works and, more importantly, what it doesn't do. An excellent read from John Bambenek at the Part-Time Pundit.

Scotiabank Q4 2006 Earnings

BMO Capital Markets, 11 December 2006Scotiabank reported fourth quarter cash earnings of $898 million, or $0.90 per share, compared to $934 million, or $0.93 per share, in the last quarter and $809 million, or $0.80 per share in the fourth quarter of last year. All three quarters had unusual items, including this quarter with the bank reversing $60 million of general allowance. Excluding these

TD Bank Q4 2006 Earnings

BMO Capital Markets, 11 December 2006TD Bank reported fourth quarter cash EPS of $870 million, or $1.16 per share, compared to $880 million, or $1.17 per share, in the last quarter, and $765 million, or $0.94 per share, in the fourth quarter of last year. There were a number of unusual items in each of the quarters. Specifically, this quarter included an AcG-13 accounting charge for hedging

Insurance Dispatch

Betting the Pharm...In this week's column, we take a look at a relatively new trend in pharmacy benefit management. PBM's are going transparent, which could mean lower health care and insurance costs.

Check it out at The Medical Blog Network.

TD Securities is Now Number 3 Securities Firm

The Globe and Mail, Sinclair Stewart, Boyd Erman, Andrew Willis, 9 December 2006The thing about Frank McKenna stories is that they inevitably veer toward the same punchline. Like the time, in the mid-1990s, that a secretary entered her boss's office with a stack of letters. The executive had decided to consolidate his company's call centres in a single location, eliciting a predictable flood of

Nipping One in the Bud...

There's been a great deal of blog-buzz recently about the new Johns Hopkins study. It purports to show that a sizeable chuck of "uninsureds' earn too much to qualify for public assistance, but nevertheless cannot afford insurance premiums.

Let me state the obvious at the outset: the study itself is fatally flawed, and its presentation so full of holes that I want a Reuben. About the only redeeming feature I could find was that it eschewed the common mistake of conflating health insurance with health care.

Okay, now to brass tacks:

According to the �study,� well over half of those folks who identify themselves as uninsured claim that they make too much money to qualify for the various public assistance programs, but not enough to afford insurance premiums. As my co-blogger, Bob Vineyard, reminded me, this seems to fly directly in the face of many previous such studies, which indicated that about 40% of the uninsured make in excess of $50,000 a year. Granted, this isn�t exactly Bill Gates territory, but it certainly enough to be able to afford some basic, catastrophic coverage.

Second, the type of plans for which these folks are supposedly shopping is never revealed. Are they looking for (expensive) first-dollars type plans, with office co-pays and drug cards? Or are they looking at, for example, high deductible plans which offer an affordable safety net? The study never says (although I�d hazard a guess). The point is, absent some critical illness, most folks will qualify for at least some basic level of coverage.

Third, it�s never made clear (if they bothered to ascertain this at all) how many of these fine folks have cable TV, internet access, or cell phones. It would be nice to know this: assuming that one has a finite income, the choices one makes as to how it�s to be spent is certainly relevant to this discussion. Absent this type of information, the study itself is meaningless.

But Professor, you may object, how can you say this when everyone knows how expensive health insurance is?

The �study� itself gives us the answer: �(W)e do not know what the benefit packages or cost sharing are for the policies for which we have premium data." That is, they have a set of values, and a set of variables, and there is absolutely no effort made to correlate the two. In other words, they just made the whole thing up.

Much ado about nothing, indeed.

CIBC Q4 2006 Earnings

BMO Capital Markets, 8 December 2006CIBC reported fourth quarter cash earnings of $791 million, or $2.34 per share, compared to $634 million, or $1.87 per share, in the last quarter, and $698 million, or $2.07 per share, in the fourth quarter of last year. This quarter included an AcG-13 charge, a $25 million reversal of general allowance and various tax recoveries, which when combined added

UBS Analyst's Global Bank Recommendations

The Globe and Mail, David Parkinson, 8 December 2006Owning a piece of a Canadian bank has become an expensive proposition. In fact, so expensive that analysts suggest investors should look outside the country if they want to add banks to their portfolios.Analysts say bank stocks in other parts of the world, particularly Europe and emerging markets, are trading at considerably cheaper

Profile of Sabi Marwah, Scotiabank's CAO

The Globe and Mail, Sinclair Stewart, 8 December 2006A little over five years ago, on his 50th birthday, Sabi Marwah stood shirtless in the marble foyer of Bank of Nova Scotia's flagship Toronto branch. At least it looked like Mr. Marwah. Sort of.His turbaned countenance had been grafted onto a beefcake's body, a cardboard cutout of rippling abs, bulging pecs, acid-washed jeans and cowboy boots.

RBC CM Cuts 41 Jobs in US Fixed-Income Sales

Bloomberg, Elizabeth Stanton, 7 December 2006RBC Capital Markets, the investment- banking arm of Canada's biggest lender, eliminated 41 bond sales jobs this week from offices in seven U.S. cities as part of a plan to add specialization in the U.S. fixed income business.The people let go in New York, Chicago, New Jersey, Florida, Tennessee and Oregon were part of the firm's so-called middle market

And Now Something Different . . .

Click here.

We now return you to your regular programing . . .

Subtle (and not so subtle) Rate Increases

Over the years I have been impressed at the ways carriers slip in rate increases at renewal. The most obvious ones are the notices, if you even get a notice, of your new rates. These are usually accompanied by a letter explaining it is not your fault, and not the carriers fault, but claims have increased and some of that must be passed on to you.

This is not totally disingenous. The cost of medical care does increase every year. There are more claims this year than last and the amounts are higher than before.

Even still, people want to blame someone else, usually the insurance carrier. So it is no wonder that carriers will find creative ways to make the cost of coverage more affordable.

One somewhat subtle way to increase margins is with the HDHP where the deductible is tied to the HSA. One of the principle carriers in this market issues a policy where the deductible is allowed to float with the treasury guidelines. Policyholders are receiving December notices that their current family deductible of $5450 will increase to $5650 in 2007. This amounts to a 3% "hidden" rate increase.

Another carrier now renews clients on a quarterly basis. If you bought your policy in March of 2006 your renewal rate goes in to effect in January of 2007. This shortened year results in paying higher rates much sooner than expected.

Drug formulary's change over time which can in some cases shift more of the cost of your "usual" med into a higher bracket. And let's not forget those beloved drug copays.

Many plans now have generic copays in the $15 range. If your script calls for a generic and you simply present your card and pay as billed, you will pay $15 even though you could have bought the same med without the card for less.

Same is true for brand names. Your brand name med may have a $40 copay but the actual cost may have dropped to $36 meaning you pay more and the carrier pays less.

Did your med become available in a generic since you had it filled the last time? Many plans will not pay for a brand name med if a generic equivalent is available. That means when you "renew" your prescription you could find that your carrier is now only allowing the cost of a generic and you pay the balance.

These are just a few of the ways the cost of health care is passed on to the consumer. We could probably devote a week's worth of postings to this topic.

BMO Investor Day

RBC Capital Markets, 7 December 2006EventCEO-designate Bill Downe and his team profiled 2007 business priorities.Investment Opinion� New Message Not Entirely New. CEO-designate Bill Downe freshened the delivery, but the core message was similar; BMO remains focused on hitting financial targets. In our view, Mr. Downe exudes a more hands-on and down-to-earth approach than his predecessor. It was

For Bank Stocks, Worst Becomes First Before You Know It

The Globe and Mail, Derek DeCloet, 7 December 2006Less than two weeks after becoming grand-fromage-in-waiting at Bank of Montreal, Bill Downe is already a genius. Really. And if he's not recognized as one, he will be soon enough. Just wait a couple of years.Don't misunderstand: It's not that we're bowled over by his intellect or charm. Mr. Downe, who takes over for retiring Tony Comper in March,

UBS Says Canadian Banks are No Bargain

Financial Post, Duncan Mavin, 7 December 2006In contrast to other international bank stocks that are currently underpriced, there's not much room for growth for Canada's bank stock valuations, said UBS investment research in a note on international banking trends for 2007."For global banks we see valuation upside potential of 16%," said UBS. The Swiss bank said it is overweight international bank

RBC Closes First Transaction on London's AIM

Financial Post, Carrie Tait, 7 December 2006RBC Capital Markets made its first move on the Alternative Investment Market yesterday, with the Canadian brokerage listing an Australian company on the British exchange.RBC listed Berkeley Resources Ltd. on AIM, an exchange catering to smaller companies, particularly mining and oil and gas concerns."We look after those companies on AIM that other

Insuring the Uninsured...part n+1

Santa Clara County, (California) the valley's largest provider of health care for people without medical insurance, thinks it can get small businesses to do the right thing -- and make the county money in the bargain.

Under the "Three Share Model'' plan, the county would make its health and hospital network -- and its 300 attending physicians -- available to low-wage workers of small businesses that currently do not offer health coverage. Participating employers and employees, in return, would pay monthly premiums....

It remains at the conceptual stage until next spring, when the county will learn if it will be awarded state money, estimated at $10 million to $15 million, to launch the project. SJ Mercury News

To be eligible, a business must have less than 50 employees, 30% of whom earn $30,000 or less per year, and who live and work within Santa Clara County. The current proposal calls for businesses to pay $125 per employee per month and the employee pay $50 per month...nothing has been said about rates for dependent coverage. If the plan gets approved by the state, it is estimated that 5000 to 10,000 people will enroll.

What this will do to the bottom line is unclear. The county provides medical services for these people anyway...with this plan they'll collect $175/month per employee. That's a lot higher than the $0 that's collected today. However, nothing has hit the press about the plan benefits versus what's currently provided. And if the enrollees now think of themselves as having real insurance, utilization may markedly increase.

It will be interesting to see how this plays out.

HSA Discrepancy in the News (finally!)

Regular IB readers may recall our investigative pieces, inspired by Joe Paduda, in which Bob and I described how unsuspecting folks get burned receiving uncovered care from network providers. As far as we know, ours are the only blogs which have extensively covered this potentially catstrophic situation, and we wondered when (if?) it would appear on the radar outside the blogosphere.

Well, wonder no more; Peter Rousmanierre, himself a blogger as well as a regular feature writer, has an article on this growing problem in the November issue of Human Resource Executive magazine. In it, he cites our work as a primary source, and has some additional information, as well.

Click away! (NB: If the link isn't working, here's a pdf of the article)

Cavalcade of Risk (#14!) is up...

The Cato Institute's Michael Cannon hosts a terrific CoR, with a dozen interesting (and often provocative) posts. And he adds not just context, but a unique sense of humor to each entry, making them even more intriguing.

Hats off to Michael!

The next edition is back here at IB. In fact, we're actually scheduling hosts for next February (can you believe it?!), so don't be shy about volunteering.

Banks Mid-Earnings Cycle Update

RBC Capital Markets, 5 December 2006� Results Beat Consensus But Quality a Concern. Last week, 3 banks posted EPS and dividends above consensus. Still, investors were dissatisfied with underlying EPS, whether it was the low tax rate at BMO, excess trading & securities gains at NA or a combination of both at RY. Also notable was a rise in impaired loans and corporate loans. In our view, underlying

Judge Rules Barclays Back in Enron Lawsuit

Reuters, 5 December 2006A U.S. federal judge, who originally dismissed claims against Barclays Plc in a $40 billion lawsuit, ruled Enron Corp. investors may file an amended complaint detailing charges that the bank helped hide financial misdeeds that led to the energy giant's collapse.In July, U.S. District Judge Melinda Harmon in Houston dismissed Barclays from the civil lawsuit, which has

Grand Rounds

Dr Emily DeVoto, hostess of The Antidote, has an outstanding collection of posts from around the medblogosphere. Her 'Rounds includes over 3 dozen entries, categorized and summarized. Nice!

From the Fellow Blogger Makes Good file: Diabetes Mine blogress Amy Tenderich has published a guide for diabetics, aimed at helping them manage their care. Mazel Tov, Amy!

Banks Renew Commitment to Branch Networks

Investment Executive, Rudy Mezzetta, 5 December 2006Canada�s biggest banks, flush with cash and looking to grow, are aggressively extending their retail networks. They will be opening scores of new branches across the country after a decade of consolidations and closings and years of concentrating on building the self-directed channels.�Ten years ago, there was a belief that the alternative

TD Bank's Former Executive to Lead Combined BoNY-Mellon

The Globe and Mail, Sinclair Stewart, 5 December 2006Six years ago, Bob Kelly caught an unlikely break: He was passed over in the race to replace Charles Baillie as chief executive officer of Toronto-Dominion Bank, and promptly handed in his resignation.Losing out on the chance to run a Big Five Canadian bank doesn't exactly reek of serendipity. But Mr. Kelly, unlike many bridesmaids in the blood

TD Green Machine Debut 30 Years Ago

The Globe and Mail, Rob Carrick, 5 December 2006In the beginning, there was the TD 3600.Fortunately for the people at Toronto-Dominion Bank, someone with a bit of marketing savvy came up with a better label for its first series of bank machines. The name used was Green Machine and, in the years after its debut 30 years ago, it became almost synonymous with automated teller machines, or ATMs, in

NoKo Insurance (Big Time Fraud?)

Everyone's favorite whacky dictator has a problem (well, several, but this one is relevant to IB): he's strapped for cash, and running out of options (and money). Sure, he could sell weapons to terrorists, or continue to pump out counterfeit US currency.

But that's just small potatoes; the real bucks, as everyone knows, are in the insurance.

No, Kim hasn't (yet) gotten his Life & Health license (so far as we know, anyway); but he has (apparently) set up a pretty interesting reinsurance scheme:

Apparently, he's insuring much of his country's infrastructure, and then submitting major claims against those policies. If true, this is insurance fraud writ large, to the tune of potentially hundreds of millions of dollars.

Why should you care? After all, it's the reinsurers who take the hit, not us, right? Well, no: our own carriers offload much of their risk to these same reinsurers, who will now have to charge more to make up for the NK losses. A double whammy.

Ouch!

Money Monday

Marshall Lebovits hosts a jam-packed edition of Carnival of The Capitalists, available now at Show Me The Money blog. This edition boasts 30 entries, with helpful categories (including Poetry & Humor) and each entry includes a description.

As one opposed to any "minimum wage" laws, I really appreciated Brian Gongol's thoughtful explanation of why they don't really do what they purport to.

BMO CM's Outlook on Life Insurance Cos

BMO Capital Markets, 4 December 2006We recently revised our target prices for a few of the lifecos and made one change in recommendation, downgrading Industrial Alliance to Market Perform from Outperform due to share price appreciation. As well, we are introducing our 2008 EPS estimates. 2008E EPS growth estimates range from 10% at Sun Life and IAG to 12.5% at Great-West and 14% at Manulife. The

Incoming BMO CEO Faces Challenges in 2007

Canadian Press, David Friend, 3 December 2006As analysts forecast a tough fiscal year ahead for the banking sector, William Downe is preparing to become chief executive of Bank of Montreal next March, replacing Tony Comper.After nearly 24 years working at Canada's oldest-largest bank, Downe's challenge is to regain retail banking clients that have been lost to other major players.In an internal

The Big Squeeze

Anticipated changes in Medicare, the (almost) universal health care coverage for those over 65, are as follows.

Part B premiums increase by $5 to $93.50/month. If your income exceeds $80,000 per year you will pay a higher premium.

Part A remains "free".

Part A deductible increases to $912. Part B deductible to $131.

Part D, the so-called drug benefit, is still being hashed out and many carriers that offered Part D plans have revamped their benefit structure & pricing.

These increases, while nominal (about 5.6%) are only part of the story. The other side is the reduction in government spending for Medicare. In other words, the new Medicare budget (if passed by congress) will reduce spending by $2.5B in 2007.

So what?

A reduction in spending translates into lower reimbursement to Medicare providers. Lower reimbursement means doctors will generally agree to see fewer Medicare patients making access even more difficult than it is now.

Bottom line?

All of us who earn more in 2007 than in 2006 will pay more in taxes. Medicare beneficiaries will pay a higher premium for Part B, pay a higher premium for Medicare supplemental coverage, pay more out of pocket when they receive services and providers will receive less in 2007 for the same services they provided at a higher rate in 2006.

So tell me. Why do folks think a universal health care system is a good idea?

Insurance Dispatch

A new guide to disease prevention that can help employers, and employees, promote good health and save money at the same time. That's the subject of this week's column at The Medical Blog Network.

Read all about it!

Almost missed this...

David Williams, host of the Health Business Blog, has an insightful post about Walmart's new(ish) $4 rx offerings. He takes on its critics with some powerful, well-reasoned arguments, and offers his thoughts on the positive implications of such programs.

Good weekend reading.

RBC Q4 2006 Earnings

Scotia Capital, 1 December 2006Fourth Quarter Results � Stellar Earnings� Royal Bank reported Q4/06 cash operating EPS of $0.97 per share, up 19% from $0.82 per share a year earlier. Earnings were driven by significant revenue growth of 12% with negligible earnings contribution from security gains.� RBC Capital Markets led earnings growth at 20%, with Canadian Retail and U.S. & International P&B

Risk vs Luck

One of our commenters has raised an interesting question: "Isn't risk just a fancier word for bad luck?"

Well, no:

Risk is about "the potential harm that may arise from some present process or from some future event," whereas luck is "an unknown and unpredictable phenomenon." The former has to do with probability, the latter with randomness.

By way of example:

Suppose I bet that you won't make a hole in one, blindfolded, at our local course. My risk is that you may, in fact, ace the hole. But the laws of probability dictate that there is a finite chance of this happening, and I can buy insurance to cover the eventuality. You, on the other hand, must depend on luck that you'll make the shot.

In the same way, health insurers know that there is a chance (a risk) that you will become seriously ill in the next year. But they also know, based on your application and their own statistics, the likelihood of this happening, and can arrive at a price that will cover that risk (premium). You may or may not become ill, but that's your luck, not the carrier's risk (which they've already managed).

Insurance is about spreading the risk; that is, assessing the likelihood that, out of a large group of people, one particular person will have a large claim. So if a person has the bad luck (we'll leave out behavioral choices for this example) to have, say, a heart attack, the company has already planned for that contingency.

Insurance is not about "spreading the luck:" there are other industries for that.

National Bank Q4 2006 Earnings

TD Newcrest, 1 December 2006EventNA reported operating EPS of $1.31, ahead of our estimate and consensus of $1.27, up from $1.25 in Q3/05 and $1.10 in Q4/05. Overall, results were solid. We believe NA has again provided shareholder�s earnings growth, as a well as a higher dividend, yet the stock trades at a meaningful valuation discount.ImpactNeutral. We are maintaining our BUY recommendation and

BMO CM Downgrades Scotiabank

The Globe and Mail, 4 December 2006Ian de Verteuil, analyst at BMO Nesbitt Burns Inc., has downgraded shares of Bank of Nova Scotia to "underperform" from "market perform."Mr. de Verteuil points to Royal Bank of Canada as a good candidate for investors who want to switch from one bank stock to another (while suggesting they stay mindful of the tax implications of such a trade).The analyst notes

Experimental Mice & Double-Knockout Mice

The chemical compound at the heart of the so-called abortion pill also appears to block breast cancer, at least in experimental mice.

Experimental mice? Something about this struck me as an odd term. Probably just me.

In mice genetically engineered to carry mutations in two genes involved in most human breast cancers, Mifeprex (mifepristone) completely blocked tumor development. No palpable tumors were detected at 12 months of age, according to Eva Lee, Ph.D., of the University of California at Irvine.

This seems to hold some promise.

In those double-knockout mice, the researchers found, the breast tissue resembled that of wild-type pregnant mice, even though they had not become pregnant, suggesting that the proliferation of mammary epithelial cells was altered.

Double-knockout mice. This really should not be humerous because of the topic, but I am having a chuckle.

The mammary glands of the mice showed sharply increased ductal branching and alveolar proliferation, compared with wild-type mice, the researchers said

Experimental, double-knockout mice with mammary's. Now my imagination is running wild.

Time for me to go.

Submissions Due...

For next week's Cavalcade of Risk (#14!), hosted by Mike Cannon of the Cato Institute. Please submit your entries (or one you like from someone else's blog) by Monday (the 4th):

� via email
or
� at Blog Carnival

PLEASE include:

? Your blog's url

? Your post's url

? The trackback url (if applicable)

? A (brief) summary

PS: We're still looking for hosts. If you'd like to host a future edition, just drop us an email.

Forced Coverage

Wal-Mart & Maryland are back in the news again . . . with a little bit of Massachussetts thrown in for good measure.

Attorneys for the state argued before a federal appeals court yesterday to preserve Maryland's first-in-the-nation statute to force Wal-Mart Stores Inc. to spend more on employee benefits, but lawmakers in Annapolis have already begun looking for other ways to expand health care access.

Maryland's bill, known as the Fair Share Health Care Act, drew national attention a year ago amid intensifying pressure for the giant retailer to change its business practices. But the measure was struck down in July by a lower-court judge on the grounds that it ran afoul of a federal law that promotes uniform treatment of employees

Who decides what is a "fair share"?

I have a problem when government tries to interfere with the free market commerce. Just when you thought this problem had gone away, it is back in the news.

The Maryland law required that companies with more than 10,000 workers spend at least 8 percent of their payroll for employee health care or make up the difference in an equivalent payment to the state. It was set to take effect Jan. 1, 2007. Of the four companies that size operating in the state, only Wal-Mart matched the criteria set out in the law, leading the company to charge that it had been singled out unfairly.

While unions and liberal groups cheered the measure, the bill sparked fears among businesses that government would soon force smaller employers to provide health care.

And there is the rub.

Where does it stop?

Well there is MA who is taking this concept much furhter in a giant leap.

Amid the legal uncertainty, a wave of similar laws predicted by national labor unions never came to pass. Instead, attention has been focused on different approaches to expanding access that have been attempted in other states, notably Massachusetts, which enacted a near-universal coverage program that received bipartisan support.

We are already seeing signs the wheels are coming off in MA where the price tag is rapidly growing and the full effect of mandated coverage hasn't even begun.

Don'tcha just love politics?

In Which I'm the Interviewee (again)

Dr Alex Kavokin, host of the most recent Cavalcade of Risk, is well-known in the medblogosphere for his interesting and informative interviews (Nursing Professor Kim McAllister, for example). Recently, he asked me to participate, and I agreed.

I was impressed (and a bit surprised) by the number and scope of his questions; they really made me stop and think.

In the event, here ya go.

A Northern Front...

We've blogged before (here and here, for example) about importing med's from our neighbors to the north.

Turns out, most Americans favor such practices, and by a wide margin:

Now, will the politicos listen, and what's the potential downside if they do?

Health Wonk Review is up

Absolutely terrific HWR this week, courtesy of Mike Cannon at the Cato Institute's blog. He presents some 16 interesting entries, all with helpful (and often humorous) context.

Bryan Caplan, who hosts the EconLog, has a quick and effective takedown of Ezra Klein's assertion that HSA's won't do much to bring down the cost of health care. Who knew economics could be fun?

One Doc "Gets It"

My TMBN colleague, Dr Rob Lamberts, has an interesting post on his practice�s answer to �doc in the box� clinics. Instead of decrying the drain it might represent on traditional practices, he welcomes such services as a call for physicians to �think outside the box.�

In fact, Dr Rob writes, �patients are sick of how doctors run their offices.� And so his office has found ways to streamline the delivery of health care. Left unsaid, but certainly implicit in this model, is whether this results in cost savings to either (or both) the doc�s or their patients.

Worth reading in full.

BMO Q4 2006 Earnings

The Globe and Mail, 30 November 2006Bank of Montreal had its profit estimates and price target cut by analyst James Keating at RBC Dominion Securities Inc. yesterday as a result of weakened growth prospects. Mr. Keating reiterated his "underperform" rating on the stock.Shares of the bank closed yesterday at $68.83 on the S&P/TSX, down 39 cents. Mr. Keating reduced his 12-month share price target

Who Pays?

The HDHP debate will probably continue for some time. Who really benefits from these plans?

Our contention at InsureBlog is that (almost) everyone can benefit in some way from the HDHP coupled with the HSA. A recent Kaiser Foundation survey would seem to bear that out.

For example, compared to people with traditional health insurance, those in consumer-directed plans are more likely to say that they always or sometimes ask about the cost of a doctor�s visit before making an appointment (39% vs. 23%) or that they always or sometimes ask about less costly alternatives (57% vs. 38%). And, over half of consumer-directed plan enrollees who have used any services under their plans say that being in such a plan has changed their approach to using health care. Of those, 57% say they changed due to cost considerations.

The observation here supports our contention that those who pay the bills are more concerned about cost containment than those who are simply beneficiaries.

If you pay, chances are you are going to ask how much it costs before making a decision on treatment. If you pay, you may also ask for alternatives that may be lower in cost but just as effective.

If someone else is paying, then price is rarely a consideration.

And there is this.

However, based on these early experiences, it appears to be that consumer-directed plan enrollees are not yet becoming the kind of savvy shoppers that advocates for these plans envision. Relatively few say they have used their plan�s Web site to compare prices across providers (5%) or to compare quality across providers (7%) � essentially the same low rates of comparison shopping reported by those in traditional plans. A small exception may be shopping for prescription drugs, with people in consumer-directed plans somewhat more likely to say they used the Internet to shop for drugs (19% vs. 10%).

Disconnected consumers.

Only 5% use the resources available to compare provider prices. Only 19% compare prices for Rx.

If consumers are this apathetic when spending their own money, how much more so are they when spending the carriers money?

Justice is Blind

OK. This site is about insurance, mostly health insurance. But sometimes a bit of news comes along that is related . . . kind of . . . and I just have to vent. After all, this is a health related issue.

The government discriminates against blind people by printing money that all looks and feels the same, a federal judge said Tuesday in a ruling that could change the face of American currency.

U.S. District Judge James Robertson ordered the Treasury Department to come up with ways for the blind to tell bills apart. He said he wouldn't tell officials how to fix the problem, but he ordered them to begin working on it.

While I have no disagreement with the comment by the judge. Certainly paper money is for the sighted, but blind people have been around since the beginning and money (or some form of exchange currency) for centuries. So why have our courts been clogged with this suit now?

One could also argue that our money discriminates against those who cannot read English.

If this suit continues, what is next? Banks? I mean, why do drive up ATM's have braille instructions?

And you have to wonder about the charge from the bench. Basically, he doesn't care what they have to do to correct this problem, and he has no clue how it should be fixed, but he still wants it corrected.

This guy is no Solomon.

Don't get me wrong. I have nothing against blind people (or any other individual with a disability). But I gotta ask. Who thinks up this stuff?

Scotia Capital Upgrades Sun Life

Scotia Capital, 29 November 2006� We are rolling out our 2008E EPS estimates and increasing our share price targets for the Canadian lifecos - we forecast modest compression in forward multiple (from current 13.3x to 13x, in line with three year average) in part due to declining bond yields. Our share price targets imply an assumed average forward multiple for the group of 13x, down slightly from

National Bank's Quebec Discount

The Globe and Mail, Derek DeCloet, 29 November 2006This is a tale of two banks. For the moment, let's call them Company A and Company B.Company A is one of best-run banks in Canada, though it wasn't always so. Along with one other player, it dominates the financial services market in one region of the country. Its earnings are diversified and, though its Bay Street securities arm has struggled,

We Have WAYS to Make You Comply

Massachusetts has implemented the first stages of the Health Care Reform Act, a widely-watched, first-of-its-kind health-care measure designed to provide every Bay State resident with health insurance, in some form. If they don�t receive it from their employers, they themselves will be required to buy it. As of this past October 1, the law imposes fines for employers who don�t offer insurance and, as of next July 1, it will penalize individuals who do not elect to purchase it.

A good idea in principle but I still have my doubts this will work as planned. Something about this article reminded me of Col. Klink in the old Hogan's Hero's TV show.

Health Savings Accounts, which have been growing in acceptance across the country, are one such product (see related feature, page 22). But because Massachusetts is still an HMO-rich state, their acceptance has lagged here, says Tsotsis. He cites an instance in which his company worked for two years to put such a plan in place to cover 4,000 eligible people, but only 100 signed up for it.

Actually, 3% penetration is not that much different from data I have seen nationwide. For the most part, the HSA seems to be more widely accepted in the individual market than it is the employer market.

We will keep our eye on this situation.

Big Brother, or Good Risk Management?

Although we tend to focus on the life and health side of the insurance business, we are InsureBlog, so we sometimes stray into P & C (that's Property and Casualty) territory, as well.

Did you know that more teens are killed in auto accidents than by any other cause? Neither did I, but as the father of two teenage daughters, this story got me thinking about it:

"Susan Schauer never gave her teenage son the car keys without also handing him something he wasn't nearly as thrilled about - a small computer chip that kept an eye on his driving.

Plugged into his family's Mazda 626, the chip recorded his speed, miles traveled and any fast starts or stops. If Ben removed the chip, it recorded that too."

There are a number of such devices on the market now, and as more become available, and as their use spreads, prices should come down somewhat. I spoke with some of my P&C colleagues about these widgets, to see if any carriers were offering discounts to folks who had them installed. Apparently, though, this tech is still under the radar.

I'm ambivalent about the idea: on the one hand, I do worry about my kids. On the other, I trust them, as well.

Any thoughts from IB readers?

Grand Rounds...

Dr R W presents an outstanding edition of 'Rounds, boasting 31 entries. Each one has a helpful summary. Bravo, Doc!

The Grunt Doc has a (short) story that illustrates what we don't mean by Consumer Driven Health Care.

Scotiabank Eyes China & India

Canadian Press, David Friend, 28 November 2006Bank of Nova Scotia is looking to carve out more business and push its brand in India after more than two decades of a marginal banking presence in the world's second most populated country.A stepping stone to that expansion will be the opening of Scotiabank's latest Chinese commercial branch in Shanghai, executive vice-president Rob Pitfield said

Medical Tourism: A New Twist

I must confess to being a bit apprehensive about this post. We've touched on IVF in the past, as it relates (or not) to risk. And we've discussed medical tourism, as well.

Remember the old Reese's Cup commercials? "You got chocolate in my peanut butter! "No, you got peanut butter in my chocolate!"

Well, this post is like that. According to the (English) Times on Line, "(t)he Vikings are coming. As sperm donations in Britain slow to a trickle, Denmark has become the sperm powerhouse of Europe."

That's right, English lasses are trading in their scones for "a Danish." (Or maybe, a Dane). Turns out, the Brits have all but outlawed anonymous sperm donations, which has caused their supply to, um, dry up. Stoking the flames is the fact that a sample of less than half a milliliter (less than a teaspoon) can fetch as much as $32.

Different strokes, I guess.

RBC CM Analyst's Preview of Bank Q4 2006 Earnings

Report on Business Television, 27 November 2006Click here for the ROBTv video clip, of Jamie Keating, Senior Bank Analyst, RBC Capital Markets.

Buy It When You Feel Threatened

Derek Dailey, a 28-year-old restaurant waiter and musician in Florence, said insurance is not something you think about "until you're faced with a situation where you need it - when you feel threatened.

"I haven't had health insurance in about five years," he said. "When you have to pick between auto insurance and health insurance... you pick auto - if you have to pick between the two."

Buy it when you feel threatened. Great advice.

Right before the oncoming car hits you, call 1-800-GetHealthInsuranceNow for your coverage.

Makes sense to me.

Price Fixing

A leading state lawmaker says it�s time to consider re-regulating health insurance premiums.

In Syracuse this afternoon, the chairman of the Assembly Insurance Committee told a hearing that insurance companies appear to be in a �get it while we can� mentality, hiking rates now, before the state returns to a system of approving future increases.

Assemblyman Pete Grannis said insurance companies are paying less in claims, and charging more in premiums.

He labeled those trends �unsustainable� and blasted what he called �extraordinarily one-sided contracts� between health insurance companies and health care providers.

Government controlled pricing is great election year rhetoric but has a 100% failure rate, no matter what the industry.

When government opts to regulate prices there is less competition. If carriers are not allowed to receive a reasonable rate on their investment they cease to write new business and eventually withdraw completely from the market place.

As this happens it becomes more difficult, and eventually more pricey, for individuals to secure the coverage they desire. Carriers who remain in the business turn to other methods to sustain profitability such as only offering a limited number of plans, making underwriting more challenging, tightening claims approval and restricting benefits.

Glad I don't live in NY.

Carnival Time!

Overachiever My Financial Journey hosts this week's Carnival of Personal Finance. With almost 50 entries, he still managed to get it out a day early (nothing wrong with that!), and with helpful context, to boot. Kudos!

Kristine at Beacon Financial Tips has some, well, tips about how to stay in-budget this holiday season.

This week's Carnival of the Capitalists can be found at Bargaineering. Over 30 posts, many with context (but alas, not all).

One Man Band blog's cehwiedel (not a typo) sounds an early warning bell about a new California universal health-insurance initiative.

Banks Q4 Profits Seen Strong

Financial Post, Don Vialoux, 27 November 2006The Canadian financial services index has a history of moving higher in late November/early December prior to release of final earnings reports for the year by Canada's top six banks.Chief executives of the banks like to offer encouraging news to shareholders when they release fiscal fourth-quarter results for the period ended Oct 31. The chart shows

Morningstar on Banks

Morningstar, Ryan Batchelor, CPA, 27 November 2006After reviewing the newly expanded International Stalwarts list in the October issue of Morningstar StockInvestor you may have asked yourself, "What gives with all of the Canadian banks?" In addition to Royal Bank of Canada, which was one of the original Stalwarts, we added four additional wide-moat Canadian banks to the list last month: Bank of

Insurance Dispatch

Would you spend 2% of your income to protect 70% of it? In this week's column, we look at a recent survey that holds some surprising answers.

Check it out at The Medical Blog Network.

Is Fair, Fair?

According to a recent study in the Health Affairs Journal, almost two thirds of those surveyed believe that smokers should have to pay more for health insurance; about a third felt that obese folks should, as well.

We talk a lot about personal responsibility here at IB, but have so far shied away from this particular controversy (mostly because it�s been somewhat under the radar). But we have discussed the importance of �risk� many times, and this would seem to fall squarely in that milieu.

Longtime readers may recall the IVF kerfluffle some time back: we sometimes forget that behavior choices have consequences. Certainly smoking falls under that heading: I�m aware of no medically-approved treatment plan that mandates one to �light up� (medical marijuana use notwithstanding). Smoking has been linked to any number of health risks, and of course smokers are subject to an increasing number of restrictions on their behavior.

Weight is another such issue: obesity can increase one�s chances for heart attacks, diabetes, and other dread diseases. Overweight folks might argue that they are subject to metabolic challenges that affect their condition, and there is probably some justification for that. Nevertheless, their condition does affect their health; underwriters are less interested in the why than in the fact.

In the life insurance and individual medical markets, smoking status and weight have long been used in assessing one�s rates. In the group market, though, these issues receive considerably less play. Generally, group plan underwriters look at the results of the behavior (cancer, diabetes, stroke, etc) when determining final rates for a group. I haven�t (yet) seen a group screening questionnaire that asks about smoking status of employees; likewise, there�s been no evidence that the behavior itself plays any part in the underwriters� decisions.

But, if there�s enough of a demand, the industry will most likely respond. At some point, some carrier will announce a special discount for smoke-free groups, or some other program along those lines. It will be interesting to see when (not if) that happens.