With the Medical Loss Ratio in the new health care law 80%-85% of premium has to go to claims. That leaves just 20% for the insurance company to spend on administration. HHS chose to include broker compensation in the administration. On large cases this does not have a  major impact but on the individual market it has been devastating. The carriers havecut the commission by 50% for individual health insurance in Indiana and the rest of the country.  This new commission structure has forced many agents in the Indiana to reevaluate their individual health insurance sales.

Rep. Andrews is the first pro health care reform politician to address this issue in favor of the brokers and agents.   For many Indiana health insurance agents the new law devalues the services that we provide to the individual health markets.

Here at Nefouse & Associates we continue to proved the very highest level of services for all our individual health insurance customers.

 If a group is running rich benefits then some of the employee are unable to afford their portion of premium.  This can happen when small group owners are more concerned about their families benefits than the entire group. There are a couple of fixes that might help here and the first one is to have the employer pick up a larger portion of the premium.  This is not a popular fix with owners! The 2nd is to look at changing the plan design to make premiums more affordable. This comes in the form of cost shifting.

Another issue that can add to lack of participation is employer contribution. If the employer pay 50% of the employee portion that might work for most of the company but if there are lower compensated employees this could be a problem. It’s important to look at contribution levels to see if they are realistic for all of the employees.

Aging population can add to a decline in participation. If a group is running age base premium rates then it can be difficult for older employees to afford them. A easy fix to this is composite rates where all the employees pay the same rate. Now composite rates can all have a negative impact on younger employees. If the premium is averaged out then some of the younger employee could go out to market and pick up individual plans. These type of situations one really has to look at the demographics of the group.

High claims can be the big obstaclefor a small group or any group for that matter. High claims can increase the premiums very quickly and then all of your healthy people come off the plan because of high premiums. This is a form of adverse selection. When high claims become obviously a owner or controller has to get to work. Tough decisions have to be made about plan design, wellness programs, and disease management.  If high claims are not addressed the group health plan can go into a death spiral with in a couple of years and then you have no more group health plan.

We have seen all of these situations and more when it comes to participation. Carriers do have the ability to audit your group for participation and they can drop you if you do not get compliant.

Keep an eye on your participation!

Age base premium is exactly what they sound like. The premium is calculated by your age. So the younger employee benefit with this because they pay less in premium. The older employee pays much more. 

Composite rates are an average of the employee ages. So every employee pays the same amount.

There are pros and cons to both approaches. Composite is much easier to administer because everyone pays the same price. The age based makes it much cheaper for younger employees which can help with retaining young health people on the plan.

Each case is different but these are things to think about when establishing a plan or renewing a group health plan.

The health saving account is a high deductible health insurance plan.  All medical claims go towards the deductible for the exception of wellness. All preventive and wellness procedures are covered at 100% with no cost to the insured.  The best way to look at these plans is they are major medical policies that will cover you for the major claims and you are responsible for the small things. 

The health savings account makes it easier for families and individual to budget for health care expenses.  Once your deductible is satisfied then all eligible claims are covered at 100% depending on the plan design. With this plan there are also tax advantages.

I think everyone should look at this approach to health insurance. The health savings account engages people to look at their health care expense and I think that is very important. If you take advantage of online tools then you will discover that diagnostic test you  need has a huge cost difference. The hospital might charge $2,000 and an outpatient facility charges $400.  If the first $2,000 in claims comes out of your pocket I think you might want want to use the facility that charges less.

Now is the right time to entertain this approach to health insurance.

“HSA plans continue to be an important coverage option for families and small businesses across the country,” said Karen Ignagni, President and CEO of AHIP.

Key findings from the census include:

•           As of January 2010, approximately 10 million people were covered by HSA/HDHP products, an increase of 25 percent since last year.

•           Between January 2009 and January 2010, the fastest growing market for HSA/HDHP products was large-group coverage, which rose by 33 percent, followed by small-group coverage, which grew by 22 percent.

•           Thirty percent of individuals covered by an HSA plan were in the small group market, 50 percent of individuals covered by an HSA plan were in the large-group market, and the remaining 20 percent were in the individual market.

•           In the individual market, 2.1 million covered lives are enrolled in HSA plans, while nearly 3 million lives were enrolled in HSA/HDHP coverage in the small-group market and almost 5 million lives were covered in the large-group market.

•           States with the highest levels of HSA/HDHP enrollment were California (1,018,000), Ohio (651,000), Florida (639,000), Texas (637,000), Illinois (575,000), and Minnesota (361,000).

For more information about the 2010 HSA/HDHP census, please visit www.AHIPResearch.org.   ]]> http://www.indianahealthinsurance.com/news/health-savings-account-enrollment-reaches-ten-million/feed/ 0 http://www.indianahealthinsurance.com/news/data-suggests-hsas-getting-popular-cutting-costs/?utm_source=rss&utm_medium=rss&utm_campaign=data-suggests-hsas-getting-popular-cutting-costs http://www.indianahealthinsurance.com/news/data-suggests-hsas-getting-popular-cutting-costs/#comments Fri, 24 Apr 2009 17:26:13 +0000 admin http://southernmedia.no-ip.org/nefouse/?p=5 Medical News Today.]]> A new report released today by the Center for Medical Progress at the Manhattan Institute finds that Health Savings Accounts are becoming more popular and have shown significant health care cost savings. Read the full article at Medical News Today.