Health Insurance Mandates

One of the reasons for substantial variation in the cost of health insurance between the states is the variations in state "must-cover" health insurance mandates.  New York and Massachusetts, both known to have among the most extensive requirements, not coincidentally have the highest average premium costs.

I found this study the other day - it was put together by a health insurance group and is certainly self-serving;  but since it is just a summary of existing law, I don't see any reason why it wouldn't be mostly accurate.

Here is one example table from the report -- it is the type of specialist care that must be covered in each state.  They also have much longer tables on the individual procedures that must be covered:


Gotta make sure that "naturopaths" are covered, don't we?  You can picture the process of specialists marching into state capitals and making their pitch that their profession needs to be covered.

You can get a feeling for what goes on with one example.  One procedure, "Port Wine Stain Elimination," caught my eye.  I assumed this was removal of some type of birthmark, but I was curious and looked it up.  I got this study near the top of the Google search, and in this link you can see the political process of mandates in a nutshell.  Here is the abstract (emphasis added)

background. Port-wine stains are congenital vascular malformations that can be disfiguring and may lead to psychosocial as well as medical complications. The 585-nm pulsed dye laser is very effective in treating port-wine stains. Laser treatment is often viewed by insurance companies as a "cosmetic procedure" and not "medically necessary." Consequently many patients are denied coverage for treatment of their disfiguring birthmarks.

objective. To determine variability of insurance coverage for laser treatment of port-wine stains from state to state. Natural history, progression, and potential complications of port-wine stains arc reviewed and rationale for consistent insurance coverage for laser treatment of port-wine stains is given.

methods. A questionnaire was mailed to 40 dermatologic surgeons in 22 states and the District of Columbia. We reviewed the literature regarding port-wine stains and their potential complications, and health care policy guidelines regarding "medical necessity" and "cosmetic procedures."

results. Insurance coverage for laser treatment of port-wine stains varies from state to state.

conclusion. Based on current health care policy guidelines, laser treatment of port-wine stains should be regarded, and covered, as a medical necessity by all insurance providers.

In other words, the study surveyed a bunch of cosmetic surgeons.  They were asked "should an expensive procedure you provide be covered by insurance."  They all answered "Hell YES!"  Anyone want to bet whether the funding for the study came from the company that makes the laser equipment?

But today, they now have to run to 50 state houses (well, 48 since they have been successful in 2).  In the future, they will just run to Congress.  And we know how good Congress is at saying no to special interests.

Postscript: I would normally assume this is obvious, but after years of blogging I know that I must add that I have nothing against those with port wine stains, I am thrilled that a technology exists today to remove them, but I don't want to pay for it in my policy.

Postscript #2: I am willing to bet that the Venn diagram of the 4 states offering "naturopath" coverage and the 3 states offering "Pastoral Counselors" don't overlap.

Postscript #3: What does a naturopath (whose tools include homeopathy) charge an insurance company for a remedy consisting of at most one molecule of active ingredient in a glass of pure but well shaken water?  Speaking of homeopathy, this is classically funny.


  1. DrTorch:

    Seems like the port wine stain removal is akin to tatoo removal. I would guess it's not terribly expensive.

    I'm sure it's discouraging to have to pay such a cost, but in the end, it gets paid thru higher insurance costs.

  2. Allen:

    Just curious, do any states mandate that more than just silver fillings need to be covered?

  3. Ed S:

    The "port wine stain" is what Gorbachov had. He got a lot of teasing about it in the US press.

    My infant daughter had similar hemangioma removed recently by one of the top guys in NYC using a similar laser procedure. The fee was $7500 for each of four five minute procedures done without anesthesia. I don't understand why this isn't as cheap as radial kerototomy. Insurance paid for all but about $400 of the cost.

    A hemangioma looks scary as hell and supposedly goes away on it's own by age 2, or maybe 5, or maybe 9.

  4. BerthaMinerva:

    I'd think there's a big difference b/w a port wine stain on your face vs one, say, on your legs. I would think a facial stain WOULD be fairly significant psychologically - elsewhere, less so.

    But I guess an insurance co couldn't get away with having a policy that says yes to covering facial treatments and no to treatments on the legs - could it?

  5. Maddog:

    Choice is important. States mandate options because they know that without mandates the costs for the few who would pay for these services would be quite high. The value to the provider is great. The incentive on the provider to help with the politicians campaign fund is great. The politician and the provider share the largesse.

    Our system is based on petty corruption. Is it surprising that it so quickly and completely corrupts our politicians?

    Mark Sherman

  6. James H:

    "The “port wine stain” is what Gorbachov had"

    Yeah, but I don't see what the expensive laser is for. Leslie Nielson (sp?) removed it with a handkerchief in one of the Naked Gun movies, if I recall. Took about 5 seconds.

  7. Jess:

    "States mandate options because they know that without mandates the costs for the few who would pay for these services would be quite high. "

    No, they (states) don't know that. Ever.

    What they (states) do know is that the sellers of a given service claim that some few would pay high (?) prices...

  8. Nathan:

    Not to support state-mandated coverage creep, but port wine stain birthmarks can actually be a serious medical problem. As I understand it, at least in some cases, the birthmarks become fragile, bleeding-prone areas, not just a pigmentary discoloration (especially in softer facial tissue like cheeks, rather than on a forehead).

  9. Jess:

    Nathan, you're correct - some "birthmarks" can lead to more serious medical conditions - something I know firsthand.
    The issue I have comes from this:
    "Laser treatment is often viewed by insurance companies as a “cosmetic procedure” and not “medically necessary""

    I would say this to the authors: define "often" & "many" (quoted from the link), and show proofs...

  10. Kyle Bennett:

    It's not "insurance" if its for something you know you have, are likely to incur, or is a matter of choice. Insurance deals in risk. It doesn't matter if it is "medically necessary" or not, covering port wine stains, pregnancy, drug abuse, colds/flu, and checkups is just socializing the costs, it has nothing at all to do with "insurance".

  11. Jodie M:

    Your assumptions about Vascular Birthmarks are dead wrong! You are showing your ignorance on what Portwine Stain Birthmarks are.

    Let's see, if you get a burn on your face or limb and it needs treatment to help it heal and make it more bearable to live with...I don't want to pay for that. If you smoke or drink and develop lung cancer or liver disease...I don't want to pay for that. If you were born with any sort of deformity...I don't want to pay for that. If you develop cancer....I don't want to pay for that. If you suddenly one day have any sort of medical issue...I don't want to pay for it!

    Tell me what is insurance for? The cost of the technology, the doctor's charges, the hospital's fees, the anesthesiologist's fees or clinic fees are all charges I cannot afford. If I were to have paid for all of the laser treatments out of my pocket, the cost's for me over the many years that I have had to receive treatment (54 laser surgeries so far) I would have had to pay around $135,000 plus the expenses I already pay out of my own pocket...deductible, travel expense such as hotel, rental car, air fair or gas, meds, bandages and loss of work wages, etc.

    We all pay for other's medical complications whether they were brought on by our own doing or if they were congenital in nature. The one's I don't want to pay for are the one's that aren't medically necessary...abortions, breast implants, penal implants, facelifts, laser surgery for wrinkles or sun spots, etc. Vascular Birthmarks are not one of those!

    Vascular Birthmarks are considered "medically necessary" as they are clusters of blood vessels are malformed, they have the great possibility of change and worsening as life progresses. Some marks are more aggressive and others are less, while very few have little change at all. To say you don't want to pay for the treatment of an anomaly that is life affecting and sometimes life threatening is an absolutely ridiculous statement.

    I have developed glaucoma in my eye, I have sinus difficulties, nasal passage blockage and have also developed blebs and swelling that cause much bleeding at times as well as dental issues. My mark left untreated will get worse by more deformation, darkening and cause more complications of bleeding and possible infections if I don't treat it. My birthmark is not just a mark that never changes or gets worse. Gorbachov's didn't cover his eye, lip, nose, cheek or go into the inside of his mouth or anywhere else. His was one of the few that had little change. That is highly usual and is not the case for most vascular birthmarks.

    Try educating yourselves about something before you speak out against it. I am sure if you or anyone you love were born (one in 3,000 people are born with some type) with this type of medical complication you would think otherwise. Here is a link to better educate yourself and your fellow commenters about Portwine Stain Vascular birthmarks: Also Google Portwine Stain Vascular Birthmarks in images to see what they actually are for many thousands of people in the world.

    Chances are this could happen to someone you personally know. Then what would you do?

  12. Kel:

    Port wine stain birthmark surgery is not purely cosmetic. PWS can cause glaucoma, calcification of the brain, swelling of the affected area to the point of not being able to see if near the eye or walk well if in the legs, deformity, overgrowth of the bone (think elephant man) and thin skin and nodules that bleed profusely at the slightest touch and are prone to infection. My son has a severe port wine stain on his face and gets surgery not to look better (he will always have a dark red stain on his face, the surgery cannot fix that for him) but to keep these other issues at bay. He can now see out of his right eye, his face no longer swells up like the elephant man when he sleeps on his belly and he doesn't bleed profusely every time he scratches his face. Which of those issues is cosmetic?