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The Hill

Under the new health care reform law, if an employer’s group health insurance is considered unaffordable — a cost to the employee of more than 9.5% of household income –  the employee would be eligible for tax subsidies through a health insurance exchange. 

As the law was originally interpreted, if the employee was also purchasing coverage for his or her dependents, the employee’s dependents would be eligible for subsidies if 20% of household income went toward the cost.  Congress’s Joint Committee on Taxation now views the law differently and has determined the subsidies are for the employee only. 

Here’s an example of what could happen: An employee purchases insurance through his employer. The employer pays 88% of the employee portion of the premium, but the employee also needs to pay to cover his dependents. The employee cost is less than the 9.5% of household income. Yet the cost of adding his dependents to the plan is unaffordable. Under the new interpretation, the employee’s dependents would not qualify for tax subsidies.

The change to the law’s interpretation is a huge blow for affordable health insurance. As a result, some experts predict a 95% increase in the cost of health insurance in the individual market, in addition to current rate increases.  A healthy person currently getting a good deal in the individual market could suffer because of cost redistribution. An increase of this size could have a crushing effect on the middle class, especially for those who are self-employed.

Have you seen a substantial increase in the cost of your health insurance? Are you aware of your options?

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 Forbes reported on the Government Accountability Office study children on Medicaid have lower access to health care and quality.

The study showed that Medicaid patients are 13% more likely to die than uninsured patients in a hospital. 66% of children covered by Medicaid were denied appointment with a specialist for an urgent medical condition.  The physicians do not want to deal with Medicaid.

With health care reform government is expecting 25 million people to join the Medicaid ranks.  This is going to lead to the rationing of care and two classes of health care. 

Indiana residents will be faced with tough decisions when it comes to the future of health care. Under the health reform law, if your house hold income is under $64,000 then you will qualify for Medicaid.  If you choose not to pay and take Medicaid the level of care will be much lower than an insured with private insurance.  There are now studies proving this. Most parents will never see the results of these studies because they will be suppressed.

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The Hill 

Health and Human Services have canceled their “Mystery Shopper” program. This program was to give HHS information on getting Doctor Appointments. They wanted information on how long someone would have to wait to be seen. They would call a medical practice and state they had Medicare, Medicaid, & Private Insurance to see if waiting times were different.  They could have been trying to make a case that Doctors will treat patients faster if they have an insurance policy that pays more.

The New York Times broke the story and soon after that there was pressure to end it from both politicians and medical providers.

This kind of information could be used to determine rationing, but HHS needs to go about collecting it in more transparent way.

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My News 

Businessweek.com 

Reported a positive view of the Accountable Care Organization (ACO) The ACO is one of the main programs to reduce health care cost in the new health care law. This is really the 1^st publication that states this type of approach to health care can be successful.  The Gov. is developing this platform for Medicare but there seems to be a huge investment by the health insurance industry in this model. The health insurance industry is suggesting this could save 40%.

If this approach works for Medicare then we will see it in the private insurance markets. This could have a huge impact on Indiana health insurance.

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Huffington Post 

 National Journal

It looks like under the new health law if you have house hold income of $64,000 you will qualify for Medicaid benefits.  For Indiana and other states this would allow a lot of people the option of Medicaid. This could devastate health insurance markets over night and add a huge burden on the state in the forms of claims.  We could also see many doctor restrict the treatment of medicaid patients because of low reinbursment rates.

It is expected that 20 million additional people could qualify for Medicaid in 2014.

The people that wrote this law might have had good intentions but the consequences are going to be massive. Right now states are already struggling with how to pay for Medicaid services and now by law there is going to be a huge influx of new Medicaid recipients.

I have been following health care refrom since the inception and I did not know about this. What else is in the law that we don’t

This study has become political so there will be arguments on both sides for and against.

I looked at the survey and results.

First thing that jumped out is over 35% represented companies with less than 50 employees. This is very important aspect of the survey with relations to health care reform. If a group is under 50 employees they will not have to provide benefits in 2014.

 When it came to the question about dropping health benefits in 2014 almost 29% of the surveyors that said they would drop benefits came from the under 50 class. This makes complete sense for these groups to look at alternative through the health insurance exchanges.

The other aspect of the survey that was interesting was that none of the surveyors had 100% complete authority over the group health insurance.

I do not think you can discredit the study. This was a 100+ questionnaire that people took the time to answer.

My News

The Indiana insurance Commissioner is asking for a waiver of Patient Protection and Affordable Care Act’s (ACA) 80 percent minimum medical loss ratio (MLR).

The commissioner states that 10% of the health insurance companies have left Indiana. If the waiver is granted that would encourage companies to stay in the individual health market. The commission is only asking the wavier on Consumer driven health plans.

There is a real problem in Indiana’s health insurance market with a lack of competition. There is serious concern that we could lose another large individual carrier.

Aetna recently left the individual market here in Indiana. The risk of loss was not worth the reward. What average people don’t see is that the individual market is not that profitable for the carriers. So now we have new laws on the medical loss ratio that could create even more risk for the carriers to offset individual loses.

I do believe the Commission is acting in the best interest of Hoosiers.

Chairman Max Baucus is not happy about the Mickinsey study that state 30% of employers will drop their group health plans after 2014. Chairman Baucus has order a full disclosure on the methodology of the study.

It will be interesting to see what methodology was used.

Being a health insurance broker with extensive experience in the small group market I think 30% is low. Groups under 100 lives I think we could see 50% of groups drop traditional employer sponsored health plans. This is not to say they will not replace them with some other approach to health care under the health care reform.  If employers can establish other qualified health plans through the exchange or guaranteed issued individual policies they will.

At this point I am not sure how large groups are going to be able to drop group health plans.  These plans are about attracting talented employees and retaining them. 

As Chairman Baucus reviews the methodology of the Mickinsey study he should also review the methodology of how the health care reform law was developed.

Nefouse News

From a coverage standpoint, all health insurance plans have to cover vaccinations at no cost to the insured.  So should your child need $600 worth of immunizations it will cost you nothing.  This was one of the few good things to come out of the health care reform laws.

There is some debate about people being on non grandfathered plan and not eligible for this benefit. Most carriers are not offering non grandfathered plans. The best way to see if you have wellness coverage is to call the number on the back of your insurance card and ask.

In the article there was a doctor quoted about the cost to the insured for these immunizations. This Doctor is not update on the current health insurance coverage. There are also state officials that are not up to date on mandated health insurance coverage.

If you are a parent it is your responsible to know your insurance coverage.  You cannot count on doctors, elected officials or gov. employees,  to be looking out for you.

The study predicts that employers that understand some of th health insurance law could find savings in dropping coverage.  This all depends on how the each state sets up the exchange plan. 

When you look at this study it shows that employers will drop that group health plan if the exchange plans make sense. There are industries that will have a very difficult time keeping employees on a companies health plan. When we look at the 9.5% rule.  If more the 9.5% of house hold income goes towards group health insurance premium then that employee can take the employer contribution and use that towards a policy through the exchange.  If an employee fall into this category why would they stay on the group health plan in the first place. They can go to the exchange with the employers money and be eligible for tax subsidies.

Right now there is a real fear that the Indiana health insurance exchange is going to be ahigh risk pool. This view is shared nation wide with all the exchanges.

Once the exchanges are developed then we will have a good idea what employers and employees will decide.