David Racer, An Agent for Health Care Agents

Agent – A person authorized by another to act on his behalf and who acts and has the power to obtain specific results.

David Racer, CEO of DRG Publications in St. Paul, Minnesota, is a friend. We go back 25 years. He helped me edit and write The Reece Report, a now defunct newsletter devoted to explaining and advancing the cause of physicians in a managed care world. And, as I write, he has collaborated with me in producing an E-book, Direct Pay Independent Practice: Medicine and Surgery, now available on Amazon.com, Nook.com, and other E-book outlets.

We share the philosophy that free independent enterprise is the best path to a superior productive health system.

This interview is about his view of independent health care agents, an overlooked and sometimes invisible force that negotiates the best of American health care plans have to offer between patients, employers, workers, and patients. He has just developed a website, http://insuranceagentexchange.net to inform agents on what is taking place in the competitive American health care marketplace and what impact ObamaCare is having on this marketplace. Dave blogs at http://racteronhealthcare.wordpress.com.

Dave Racer can be reached at 1-651-705-8583, dracer@comcast.net, or DRG Communications, Inc, 1535 Barclay St. Suite B-1, St. Paul, Mn, 55414.

Q: Dave, what is your official position?

A: I am the CEO of a small public relations company and spend a great deal of my time researching, speaking, and writing on health care and health care finance.

Q: Much of what you do is related to the work of health care agents and their relationship to ObamaCare. Is that accurate?

A: Yes. I am the agents’ advocate. I am helping agents work through the mess and chaos ObamaCare has created.

Q: What is the primary function of health care agents?

A: The primary function is to find the best, most affordable health care product. They try to match up clients with the best health plan to keep them insured.

Q: How many agents are there in the U.S.?

A: I don’t know offhand, but we do know in Minnesota there are over 24,000 domiciled agents carrying health insurance licenses. In the U.S. there are hundreds of thousands of agents.

Q: Would it be fair to say the majority of these agents resist ObamaCare?

Q: Yes, by nature many agents tend to be conservative. They prefer state regulation to federal regulation. Like doctors, they do not like losing control of their profession. They like keeping regulations close to home. They do not take the federal government taking control of health care and health care finance.

Q: I gather they do not like these health care navigators appointed by Obama. Is that on target?

A: You are correct. In many ways, agents resent the navigators taking over the tasks agents are trained to do but must be licensed to do. They look at navigators as amateurs guessing their way through a complicated field and not providing quality counsel.

Navigators are inexperienced and have little training. They are making recommendations to clients that may or may not be in their best interests. They get grants of hundreds of thousands of dollars to go out and find clients.

Q: How do agents feel about healthcare.gov?

A: They feel the primary function of healthcare.gov is to get more people subsidized by government rather than from private sources. If the exchanges have any benefit at all, they are getting more people to sign up for Medicaid and to get people on the government dole. They feel there is no reason to have exchanges. That is the way agents look at it.

Q: Agents are proponents of health savings account-based plans, which are growing faster than any other type of health plan.

A: That is true in general. Minnesota has the highest rate in the nation in individuals enrolled in consumer-oriented health plans, another name for health savings accounts. Agents have fully embraced consumerism, and they aggressively pursue HSAs and related plans.

Q: What is the premium pay differential between HSAs, PPOs, and HMOs and how much do HSAs decrease the cost for employers?

A: In the beginning, there was a 40% to 60% differential. So it was easy to sell HSAs. The differentials have shrunk. Itis probably now more like 10% to 20%.

Q; It is acknowledged that Democrats appose HSAs ideologically because it gets in the way of progress towards a single-payer system. The Obama administration has a bias against consumer-friendly plans. In ObamaCare plans, HSAs are not an option.

A: I lived in Minnesota for 25 years, and my observation was that Minnesota was liberal politically and conservative in business. How has that combination worked out in recent years?

A: Not so much now. Government looks at business as a place to get revenue. Politically government is not friendly to business, and many large corporations, like 3M and Medtronic, have moved their headquarters out of state. Minnesota is a tough place to do business when Democrats control government.

We have two Democratic Senators, a Democratic governor, 3 of 5 Democrats Representatives, and a Democratic legislature., which is why they passed MnSure, the Minnesota health exchange, which is in deep financial trouble and has been one reason for $2 billion tax increases. Ninety percent of the 250,000 who signed up for MnSure are on Medicaid or receiving subsidies or tax subsidies. Senator Franken is up for re-election. His vote was the vote who gave us ObamaCare. His lead in the polls is not that great, and he is being heavily subsidized by out of state donors. Right now the major political issues are health care, immigration, and government surveillance.

Q: Dave, you were very active in organizing two conferences for the American Association of Physicians and Surgeons on direct pay/concierge medicine and surgery. What is your read on the status of that movement?

A: It is a nascent movement. And yet there a growing number of physicians, even here in Minnesota, who are considering joining it. I often receive calls from physicians asking me, a non-physician, who do I make the switch? It’s an emerging response to more and more control and reduced reimbursements. I do everything I can do to encourage it. I think direct pay/concierge practice will be a growing phenomenon is some markets, but not in others. I do not think direct care will ever dominate the market nationally.

As we move towards Accountable Care Organizations and other huge systems, I just have to believe substantial numbers of doctors are going to resist and break out into direct pay practices. I worry about the day the federal government issues a decree that all licensed physicians must accept Medicare and Medicaid patients.