Posts Tagged ‘health insurance premiums’
As a result of the health care reform Individual health premiums are going up. As of Sept. 23rd we will see rate increases from anywhere of 20%-54%. This is a direct result of Health Care Reform.
Under health care reform all policy will have to cover “Essential Benefits”. The Essential Benefits will have no annual max which means they are unlimited. So for an example bariatric medicine would be covered with no limitation. This sounds great if you are one that needs those services but the problem is everyone is going to have to pay for that benefit.
For new Individual policies the price is going to up. If you are on a policy that was in place prior to 3-23-10 you will be grandfathered in. Being grandfathered in might help you save a significant amount form the rate increase that is coming. If you are not grandfathered in your policy will include all of the new coverages and then you will see the rate increase at your renewal. Some carriers might give the rate increase immediately while other will wait for the renewal date.
As of Sept. 23 there will be an open enrollment period for children’s under 19. This open enrollment period will be a time where children can not be declined coverage. We expect the premium amount for a stand alone child policy to be in the ball park of $400 a month. Outside of that open enrollment children will have to go through underwriting to get a policy. If a child is approved for the policy they cannot be pre x. Right now we do not have an estimate of what that policy cost could look like.
With this health care reform we are about to see health insurance premiums at an all time high.
Please check back with us as more details become available.
With Sept. 23rd right around the corner health plans are ordered by law to cover certain aspect of reform.
There is real uncertainty in the carrier market. We have already seen an exodus of stand alone children policies being offered. The only carrier offer standalone children’s plan is Anthem. There is a chance that they too could pull out of that market. The problem the carriers are having is as Sept 23rd any child under 19 year age is guaranteed issue which means they can not be declined or pre x for any kind of health coverage. This could lead to major premium increases if the policies are even available. The government has agreed to allow the carriers to have an open enrollment period for these type of plans which will help.
The other uncertainty right now is the preventive care coverage that is being mandated under the health care reform. The individual carriers are looking to the government to give clarification on these rules. The problem then occurs is designing a plan that is compliant with health care reform and then getting the new plan design approved with the department of insurance in each state.
With these current issues we could see a black out of indiviudal coverage for new policies. So on Sept. 23rd you might not be able to get a new individual policy. If you are in the market for a policy you need to act fast because who knows how long it could take before carriers clear up these issues with both the Federal Gov. and local Gov. On a positive note they could get all this resolved before Sept. 23rd.
Current estimates on possible price increase for individualplans for this aspect of health care reform is anywhere from 4%-8%. There are no available estimates on the price increases for a stand alone child’s policy.
Under the health care reform all children under 19 can not be declined or pre x on a health plan. Everyone in the industry had major concerns over this issue. One of the big concerns was parents would wait until the child had a health care crisis and then enroll them on the plan. It was just released that carriers are now going to be able to have open enrollments for these types of plans. That means the child can get the plan without underwriting but only once a year.
We are now starting to see the reality of what can and cannot be done under the health care reform. In the last few months almost every Individual carrier pull out of the stand alone child market. Not only did we see regional carriers pull out but we also saw national carriers. When national carriers pull out of a market that is the a huge red flag because they have large reserves. It will be interesting to see if the carriers that pulled out get back in.
Another aspect that might be interesting is the premium for those stand alone policies during the open enrollment period. Will that policy cost more?
| The medical loss ratio (MLR) is the most important aspect of healthcare reform. This interpretation of this law is going to determine if the private industry stays in business. The one positive thing is the NAIC is in charge of interpreting the MLR.
The National Association of Insurance Commissioners was charged by Congress with considerable implementation responsibilities relative to PPACA, and NAHU continues to work with state regulators and the NAIC on a weekly basis on implementation issues of concern to health insurance agents and brokers. The primary issue the NAIC is currently working on of key interest to NAHU and its members is the crafting of definitions relative to what health insurance services will be covered by the PPACA’s minimum loss ratio (MLR) requirements.
The law gives the NAIC until December 31 to craft the MLR definitions, but HHS has requested that the NAIC complete its work early so that necessary regulations relative to MLR implementation can also be developed. HHS originally asked that the NAIC complete its work by June 1, but the NAIC rejected the timetable, stating it was too tight. Initially, the NAIC said they hoped to get their final work product to HHS by the end of July. However, during a conference call yesterday, Commissioner Steve Ostlund, chair of the NAIC’s Accident and Health Working Group, which is the primary committee within the NAIC working on the definitions, backed away from the end-of-July timeframe. While he was clear that the group will finish its work well in advance of December 31, he refused to specify exactly when they will finish.
The NAIC committees addressing this issue meet via conference call on at least a weekly basis, and the group is holding an interim meeting on the MLR issue in Washington the week of July 18. The NAIC will also hold their regularly scheduled meeting in Seattle from August 14-17, and NAHU will continue to be an active participant in all of these calls and meetings. Our most recent letter to the NAIC on the MLR issue was sent in conjunction with the entire Agent/Broker Alliance and can be found here.
In addition to the MLR issue, the NAIC is also charged with crafting a sample of the notice all health insurers must send to customers by March 2012 outlining plan benefits and costs. The goal of the NAIC committee is to translate complicated insurance-related terms and benefit information into summaries that can be easily digested by consumers. PPACA required the NAIC committee to be made up of not just insurance regulators, but also interested parties like insurers and consumer groups. NAHU CEO Janet Trautwein was appointed by the NAIC as one of the statutory working group’s formal members to represent the interests of health insurance agents and brokers.
The law gives the NAIC group until March 2011 to craft their sample forms, and the committee has begun meeting on a biweekly basis to accomplish that task. As with the MLR definitions, HHS has requested that the committee finish its work early—by the fall of 2010. NAHU will keep you apprised of the committee’s progress on the sample notices via future editions of Washington Update. |
This is a interesting view of plan designs. The specific breakdown of industry and co pays is really interesting.
According to the data, transportation and financial services employees are paying more for office visit copays than those employees in the manufacturing, services and wholesale industries. Based on recent 2010 data from Highroads, an industry leader in employer health care compliance and benefits management.
•79% of transportation employees pay $25 or more in office visit copays
•69% of financial services employees pay $25 or more in office-visit copays
•97% of wholesale employees pay $20 or less in office-visit copays
•87% of services employees pay $20 or less in office-visit copays
•67% of manufacturing employees pay $20 or less in office visit copays
Across all fully insured plans, the data shows average monthly 2010 premiums to be as follows:
•Employee only: $380
•Employee plus one: $788
•Employee plus children: $726
•Family: $1,133
Across all fully insured plans, shows the median of 2010 plan provisions to be as follows:
Plan Provision Median
Office Visit Copay $20
Specialist Office Visit $30
Inpatient Hospital Copay $250
ER Copay $75
Infertility Treatment Co-insurance 50%
This dats is a snap shop of what Indiana group health plans look like.
HHS Releases Final Interim Guidance on Several PPACA Provisions
On June 22, 2010, the Departments of Health & Human Services, Labor, and Treasury issued new regulations that better define the following PPACA provisions:
- No Pre-Existing Condition Exclusions for Anyone Under Age 19
- No Arbitrary Rescissions of Insurance Coverage
- No Lifetime Dollar Limits on Coverage
- Restricted Annual Dollar Limits on Coverage
- Broader Doctor Choice
- No Higher Out-of-Network Cost-Share for Emergency Department ServicesOn June 22, 2010, the Departments of Health & Human Services, Labor, and Treasury issued new regulations that better define the following PPACA
These are labeled as interim final rules (IFRs), which means final rules may differ. As clarification continues to be provided through the federal government’s rule-making process, we’ll share that information with you. Please continue to look out for e-mail Alerts and information on our Health Care Reform website on these important subjects.
All provisions are effective on the first plan anniversary on or after 9/23/2010
No Pre-Existing Condition Exclusions for Anyone Under Age 19
Plans are prohibited from denying coverage to anyone under the age of 19 based on a pre-existing condition. This ban includes both benefit limitations and coverage denials. These policies apply to all individual market and group health insurance plans. The requirement will be extended to all ages starting in 2014. Grandfathered individual plans are exempt from this requirement.
No Arbitrary Rescissions of Insurance Coverage
Insurers and plans will be prohibited from rescinding coverage – for individuals or groups of people – except in cases involving fraud or an intentional misrepresentation of material facts.
No Lifetime Dollar Limits on Coverage
Insurers and employers are prohibited from imposing lifetime dollar limits in all health plans and insurance policies issued or renewed on or after September 23, 2010.
Restricted Annual Dollar Limits on Coverage
The rules will phase out the use of annual dollar limits on “essential health benefits” over the next three years until 2014 when the Affordable Care Act bans them for most plans. The limits can only apply to essential health benefits; however, the rule does not provide any further detail on the definition of “essential health benefits” beyond that provided in the law.
- Plans issued or renewed beginning September 23, 2010, will be allowed to set annual limits no lower than $750,000
- Beginning September 23, 2011, minimum limit will be raised to $1.25 million
- Beginning September 23, 2012, minimum limit will be raised to $2 million
- Beginning January 1, 2014, all annual dollar limits on coverage of essential health benefits will be prohibited
These limits apply to all employer plans and all new individual market plans. It does not apply to grandfathered individual plans.
Waiver Process/Special Consideration:
The IFRs indicate that the Health & Human Services Secretary will design a process by which employers and insurers may apply for a waiver to delay complying with the restricted annual dollar limit rules if compliance would cause a significant loss of coverage or increase in premiums. The IFRs indicate that limited medical plans are one example of the type of plan that may apply for a waiver. We await details from the Secretary about the waiver application process.
Broader Doctor Choice
Health plan members are free to designate any available participating primary care physician (PCP) as their provider (e.g., pediatricians for children). Also, plans cannot require a referral for OB-GYN care.
These policies apply to all individual market and group health insurance plans except those that are grandfathered.
No Higher Out-of-Network Cost-Share for Emergency Department Services
Health plans and insurers will not be able to charge higher cost-sharing (copays or coinsurance) or require prior authorization for emergency services that are obtained out of a plan’s network. This policy applies to all individual market and group health plans except those that are grandfathered.
The McCarran-Ferguson Act that created that antitrust exemption for the health insurance industry has been repealed through the Patient Protection and Affordable Care Act (PPACA).
This will prevent the health and medical malpractice insurers from being exempt from antitrust regulation.
An example of how the health industry has had problem is in a case in New York invovling usual and customary rates. There was a company that was determining what U&C should be and it turned out that company was owned by one of the major insurance companies in that state. This created a serious conflict of interest and could be viewed as fraud.
The Repeal of this Maccarrn- Ferguson Act could turn out to be good thing for the consumer.
This is the first result of a carrier telling the Federal Government we just won’t sell that product anymore. As of Sept 23rd 2010 of this year all Children under 19 will be eligible for guaranteed Issue on a stand alone health plan. This means they can not be declined or pre-x.
Golden Rule which is owned by United Healthcare has pulled out of the of that market. This is a negative thing because now we have less carriers competingfor that market. When we have less carriers that is a reduction of competition and choices. Anytime we have less competition that leads to higher prices.
This is the first big response from a national carrier to health care reform and it has gotten almost zero press.
If you are reading this and you have a dependent children under 19 I would advise you to lock into an individual policy for them. If your able to get them on their own policy that contract could be grand fathered in and could save you thousands of dollars in premium.
Health-Care Bill Surprise For Indiana Businesses
A report from Bloomberg Business week reveals that on page 737 of the Health Care Bill approved by Congress there are 3 paragraphs that have nothing to do with health Care.
The provision inserted by Democrats on the Senate Finance Committee to help offset the cost of the bill, requires companies to report to the IRS payments of more than $600 years to any vendor. The intent is to capture $2 billion a year in taxes that goes unreported by contractors and small business.
In 2012 we Hoosiers businesses will need to get tax ID numbers and file forms for almost all suppliers and track all expenses to see which vendors meet the threshold. Spend $600 with any business and now you will have to have a tax ID number from that vendor. Local Gas station, Cell phone, FedEx and so on you will have to file a 1099.
The National Small Business Association estimates that a company will have to file an additional 75 forms with the IRS.
Representative Dan Lungren (R-Calif.), with the support of small business advocates, has introduced a bill to roll back the provision. It might be a good idea to send a email to our Representative to repeal this aspect of the bill.
The Milliman Medical Index has been released for 2010. This is a very good study of healthcare costs and the effects that they have. 2010 marks the 6th year that the study has been performed. The top 100 leading insurers read this report to estimate future health insurance claims costs. You would think that our government officials would all take this study into consideration when they are making laws that effect healthcare.
The topics that are discussed in the Study:
Key Findings
The total medical cost for a typical family of four in 2009 was $16,771. In 2010 the study shows an increase of 7.8% to $18,074. Employers and Employee alike shared the increase in cost this year.
Employers cost at an average of $10,744 surpasses $10,000 for the very first time.
Geographic Differences in Healthcare Costs
The study shows that Miami, New York and Chicago continue to have costs at leasts 10% higher than the national average.
Dissecting HealthCare Costs
In this section the $18,074 is broken down into components of spending.
15% Rx+ 33% Physician +17% outpatient+ 31% inpatient +4% other
Employee’s Share of Healthcare Costs
In 2010 the employer is picking up $10,744 of the $18,074 of total healthcare cost to a family of four.
Economic Effects on Healthcare for People with Insurance
This section is addresses the effects of unemployment and health insurance. The study addresses the effects layoffs have on people who continue to be insured under the employer plan.
Cost Implications of Healthcare Reform on a Family of Four
The study states the cost implications are unclear.
Technical Appedix_Milliman Medical Index
This section discuses how the Index is formed.
2010 Milliman Medical Index
