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Holy cow: "After my surgery [for cancer], while I was still on maternity leave, I received a form letter saying that the health insurance provid

Holy cow: "After my surgery [for cancer], while I was still on maternity leave, I received a form letter saying that the health insurance provided by my employer had been terminated. Dozens of panicked emails and phone calls later, the whole thing was, I was told, a glitch in the system. After a week of back and forth, I was offered COBRA coverage, by which point I had already switched to my husband’s insurance, where I remained for the duration of my care." That's a pretty GIGANTIC "glitch," one that turned out hugely in Amazon's favor. Cheiffetz claims she accepts that it was an "administrative error," but you have to wonder. By getting her to switch to her husband's plan, Amazon may have saved themselves hundreds of thousands of dollars.

xcyu 11y ago
Sounds like a great application of their Frugality principle. http://www.amazon.jobs/principles http://www.amazon.jobs/principles
- josephjrobison 11y ago
  On another note, those are some of the cheesiest stock photos they ever could have picked.
  - rdtsc 11y ago
    I had to look at them preparing for my AWS interview, then I had to parrot the principles back at them through my own experience. "What was your biggest failure?" (Alright...let me try to pick one of the leadership principle to parrot back through my biggest failure while also having my self-esteem show down thinking about my failures).
  - mmagin 11y ago
    Surprisingly they have less of the deliberate yes-we-have-diversity than the usual selection of stock photos used on such a document by a big company.
  - magic_beans 11y ago
    I'm sure an algorithm picked them. Even a design intern working for free could have picked better photos.
- Florin_Andrei 11y ago
  Yeap, they treat their people frugally.
ohitsdom 11y ago
The insurance company saved money, but did Amazon? I thought the portion of premiums that employers pay is fixed? That's why everyone pays premiums- the healthy subsidize the sick. And when there are more healthy than sick, the insurance company profits. What am I missing, how would Amazon save money by her switching insurance providers?
- chimeracoder 11y ago
  > The insurance company saved money, but did Amazon? I thought the portion of premiums that employers pay is fixed? Large companies actually underwrite their own plans (this is known as self-insuring[0]). The plan is managed by a known insurance company (e.g. Aetna, Blue Cross), so from the employee's perspective it's the same, but the actual risk is borne by the company. I would be very surprised if Amazon did not do this, given their size (~200K employees) and company age (over 20 years). As a rule of thumb, the break-even point is about 1000 lives covered. Once a company gets to that point, it starts to be in their best interest to underwrite the insurance plans they provide. Source: Founded a health-tech company that sold to insurers (which meant selling to companies that self-funded their plans as well, as they were they real risk-bearing entity). [0] https://en.wikipedia.org/wiki/Self-funded_health_care https://en.wikipedia.org/wiki/Self-funded_health_care
  - sjg007 11y ago
    Yes but a self insured company should also buy catastrophic reinsurance that covers high claims cases.
    - chimeracoder 11y ago
      Reinsurance doesn't completely let the company off the hook for the costs (in the long run). Even if reinsurance covers 100% of costs above the cap (which it typically does not), those costs will just get factored into the future premiums charged to the company[0] . It makes it hard to place an exact price tag on how much this employee's coverage would have cost the company without knowing the details, but it's clear that it would have been very expensive to them one way or the other - and certainly a lot more than it cost them to have her switch to her husband's insurance instead. [0] It's just like how your renter's insurance rates will [often] skyrocket immediately if you try to file any claim at all. People aren't used to this in the consumer health insurance market because there's a lot of indirection in the healthcare system, but that's how all insurance models work at a high level[1], so that's how the costs all (eventually) flow (extra emphasis on "eventually"). [1] There's also the added wrinkle that we also use "health insurance" as a political tool to do things that have nothing to do with risk smoothing at all, so the model gets tricky to unpack, but that's a separate matter.
ninv 11y ago
"glitch in the system", sounds like business requirement to me. HR could not reactivate her health insurance so they called it a glitch in the system. I am sorry for all the folks working there.
- MCRed 11y ago
  Yes, one of the big lessons of the corporate world is that almost anything you hear from HR, even in good companies, is a lie. OR at least, some sort of spin. Even when they are saying good things, they don't really know, they're just making stuff up, or exaggerating. It's like they are trained to live in this fantasy world and pitch that to the employees.
  - matthewmacleod 11y ago
    I'm sorry you've had bad experiences, but this isn't really true, in the sense that HR is different from any other department in this regard. Think about it – doesn't the same apply to corporate IT for example?
    - elektromekatron 11y ago
      I dunno, Scott Adams got HR pretty good when he created Catbert.
      - jahewson 11y ago
        Wow, that's ungrammatical.
        elektromekatron 11y ago
        Or possibly rhetorical writing intended to convey an offhand comment by impersonating the style of speech. Who can say?
  - deleted 11y ago
    [deleted]
shazow 11y ago
I've no insight about Amazon's process with insurance, but being with Covered California we lose our insurance about twice per year due to "glitches" in the system. Each time we find out months later when a claim gets declined and thus requires hours spent on the phone, going through various levels of support. It wouldn't surprise me at all that the entire health insurance infrastructure in the country is glitchy to the core, but who knows.
shostack 11y ago
I wonder if there is a legitimate glitch that is at the absolute bottom of a priority list to fix (and stays there) because it makes them more money. Does insurance have the concept of "breakage" like with rebates in terms of whether people follow through on these "glitches?"

xcyu 11y ago

Sounds like a great application of their Frugality principle. http://www.amazon.jobs/principles http://www.amazon.jobs/principles

josephjrobison 11y ago
On another note, those are some of the cheesiest stock photos they ever could have picked.
- rdtsc 11y ago
  I had to look at them preparing for my AWS interview, then I had to parrot the principles back at them through my own experience. "What was your biggest failure?" (Alright...let me try to pick one of the leadership principle to parrot back through my biggest failure while also having my self-esteem show down thinking about my failures).
- mmagin 11y ago
  Surprisingly they have less of the deliberate yes-we-have-diversity than the usual selection of stock photos used on such a document by a big company.
- magic_beans 11y ago
  I'm sure an algorithm picked them. Even a design intern working for free could have picked better photos.
Florin_Andrei 11y ago
Yeap, they treat their people frugally.

ohitsdom 11y ago

The insurance company saved money, but did Amazon? I thought the portion of premiums that employers pay is fixed? That's why everyone pays premiums- the healthy subsidize the sick. And when there are more healthy than sick, the insurance company profits. What am I missing, how would Amazon save money by her switching insurance providers?

chimeracoder 11y ago
> The insurance company saved money, but did Amazon? I thought the portion of premiums that employers pay is fixed? Large companies actually underwrite their own plans (this is known as self-insuring[0]). The plan is managed by a known insurance company (e.g. Aetna, Blue Cross), so from the employee's perspective it's the same, but the actual risk is borne by the company. I would be very surprised if Amazon did not do this, given their size (~200K employees) and company age (over 20 years). As a rule of thumb, the break-even point is about 1000 lives covered. Once a company gets to that point, it starts to be in their best interest to underwrite the insurance plans they provide. Source: Founded a health-tech company that sold to insurers (which meant selling to companies that self-funded their plans as well, as they were they real risk-bearing entity). [0] https://en.wikipedia.org/wiki/Self-funded_health_care https://en.wikipedia.org/wiki/Self-funded_health_care
- sjg007 11y ago
  Yes but a self insured company should also buy catastrophic reinsurance that covers high claims cases.
  - chimeracoder 11y ago
    Reinsurance doesn't completely let the company off the hook for the costs (in the long run). Even if reinsurance covers 100% of costs above the cap (which it typically does not), those costs will just get factored into the future premiums charged to the company[0] . It makes it hard to place an exact price tag on how much this employee's coverage would have cost the company without knowing the details, but it's clear that it would have been very expensive to them one way or the other - and certainly a lot more than it cost them to have her switch to her husband's insurance instead. [0] It's just like how your renter's insurance rates will [often] skyrocket immediately if you try to file any claim at all. People aren't used to this in the consumer health insurance market because there's a lot of indirection in the healthcare system, but that's how all insurance models work at a high level[1], so that's how the costs all (eventually) flow (extra emphasis on "eventually"). [1] There's also the added wrinkle that we also use "health insurance" as a political tool to do things that have nothing to do with risk smoothing at all, so the model gets tricky to unpack, but that's a separate matter.

ninv 11y ago

"glitch in the system", sounds like business requirement to me. HR could not reactivate her health insurance so they called it a glitch in the system. I am sorry for all the folks working there.

MCRed 11y ago
Yes, one of the big lessons of the corporate world is that almost anything you hear from HR, even in good companies, is a lie. OR at least, some sort of spin. Even when they are saying good things, they don't really know, they're just making stuff up, or exaggerating. It's like they are trained to live in this fantasy world and pitch that to the employees.
- matthewmacleod 11y ago
  I'm sorry you've had bad experiences, but this isn't really true, in the sense that HR is different from any other department in this regard. Think about it – doesn't the same apply to corporate IT for example?
  - elektromekatron 11y ago
    I dunno, Scott Adams got HR pretty good when he created Catbert.
    - jahewson 11y ago
      Wow, that's ungrammatical.
      - elektromekatron 11y ago
        Or possibly rhetorical writing intended to convey an offhand comment by impersonating the style of speech. Who can say?
- deleted 11y ago
  [deleted]

shazow 11y ago

I've no insight about Amazon's process with insurance, but being with Covered California we lose our insurance about twice per year due to "glitches" in the system. Each time we find out months later when a claim gets declined and thus requires hours spent on the phone, going through various levels of support. It wouldn't surprise me at all that the entire health insurance infrastructure in the country is glitchy to the core, but who knows.

shostack 11y ago

I wonder if there is a legitimate glitch that is at the absolute bottom of a priority list to fix (and stays there) because it makes them more money. Does insurance have the concept of "breakage" like with rebates in terms of whether people follow through on these "glitches?"