CFOs say they’ll increase health plan cost-sharing, blame PPACA
Originally posted January 09,2014 by Dan Cook on https://www.benefitspro.com
The old employee health care cost pass-along is going to heat up considerably this year. And guess who’s getting the blame for it? Yep, the Patient Protection and Affordable Care Act.
At least that’s the consensus from an in-depth survey of 96 corporate CFOs executed by Deloitte Consulting. Respondents told Deloitte they’ll be asking employees to kick in more for company coverage and, when asked why they have to, they’re going to point to Obamacare as the cause.
Health insurance trends were just part of this much broader survey. In general, the companies sampled are optimistic about 2014 and seem to feel their employers have done a good job of getting the ship in shape for this year. While they are forecasting relatively low sales increases in 2014 vs. 2013, earnings expectations actually increased slightly, and 54 percent expressed “rising optimism” about quarterly returned compared to 42 percent last quarter.
When it comes to health insurance costs, containment is the key word. These CFOs have been told to rein in health costs and they’re going to do so by shifting costs to those covered.
That this is the preferred option over reducing coverage was made clear when just 10 percent said they would offer employees less robust coverage packages. Instead, 60 percent have raised or will raise the employee portion of cost, keeping benefits where they’re at. (Only 10 percent said they’d beef up the health benefits package.) Another 28 percent are considering doing so.
When asked about health care cost controls, Deloitte said nearly two-thirds of companies have taken at least one major cost-control step, usually either implementing wellness programs or raising employees’ financial responsibility. About 45 percent plan to take a second cost-control step in the next 12 months. For cost pass-along employers, most choose higher premium contributions and deductibles.
Perhaps fearing a slump in morale or an increase in negative gossip, these CFOs weren’t about to let the company take the blame for higher employee cost sharing.
Deloitte said “42 percent of (U.S.) chief financial officers who have shifted additional healthcare costs to workers cited the Affordable Care Act as their impetus. The number blaming the healthcare law rose to 63 percent for CFOs planning to shift costs in the next year. The statistics suggest that Obamacare is aggravating the trend of employers charging staff higher healthcare costs in order to contain spending, and came as most CFOs expressed rising optimism about their companies’ prospects.”
The PPACA served as whipping boy on other fronts. The survey said:
- About 13 percent blamed reduced their earnings forecasts on the act;
- 8 percent cited the act for constrained hiring;
- 4 percent said the act forced them to shift toward part-time staffing.
Second wave of health-insurance disruption affects small businesses
Originally posted January 11, 2014 by Ariana Eunjung Cha on https://www.washingtonpost.com
When millions of health-insurance plans were canceled last fall, the Obama administration tried to be reassuring, saying the terminations affected only the small minority of Americans who bought individual policies.
But according to industry analysts, insurers and state regulators, the disruption will be far greater, potentially affecting millions of people who receive insurance through small employers by the end of 2014.
While some cancellation notices already have gone out, insurers say the bulk of the letters will be sent in October, shortly before the next open-enrollment period begins. The timing — right before the midterm elections — could be difficult for Democrats who are already fending off Republican attacks about the Affordable Care Act and its troubled rollout.
Some of the small-business cancellations are occurring because the policies don’t meet the law’s basic coverage requirements. But many are related only indirectly to the law; insurers are trying to move customers to new plans designed to offset the financial and administrative risks associated with the health-care overhaul. As part of that, they are consolidating their plan offerings to maximize profits and streamline how they manage them.
“If they do it one way, the word canceled gets attached to it. If they do it another way, they say they are amending the policy. It sounds more gentle but it’s the same thing,” said Gary Claxton, an expert in private insurance at the Kaiser Family Foundation. “The basic point is, for many people in the small-group market at some point soon their coverage is going to change.”
The transformation of the small-group market is just one of the many ripple effects of the Affordable Care Act that will reshape the insurance industry in coming years. With millions of previously uninsured people getting coverage, the insurance industry’s business model is being upended, and that’s leading to changes involving all sorts of products, not just those sold through the online marketplaces to individuals.
The impact of cancellations in the small-group market is expected to be less dramatic than in the individual market, partly because a higher percentage of small-business policies provide more generous benefits. Still, the changes being made by the insurance industry are leaving some small-business owners confused and disillusioned about the law — whether it is directly to blame for the changes or not.
Stephen Lohman, owner of Allegheny Plant Services, a trucking company in Pittsburgh, said the Aetna PPO plan he offers his 38 employees will be discontinued at the end of this year. He said he has been offered a new Aetna policy with premiums that are 40 percent higher, and that other insurers’ rates are similar.
“We were very surprised,” he said, adding that it is “important to me personally” to offer insurance to his employees, but he is not sure he can afford the premium increase.
Now that insurers aren’t able to charge more to people with preexisting conditions, companies with sicker workers may see lower premiums, while those with a healthier workforce may see higher premiums. Many small businesses are also discovering that the new plans have more restrictions on access to specific doctors, hospitals and prescription drugs.
The reason, said Robert Zirkelbach, a spokesman for America’s Health Insurance Plans, the industry’s main trade group, is that the law requires small businesses to purchase coverage that is more comprehensive than what some buy today, and that drives up costs.
Some small businesses are eligible for new tax credits to partially offset the cost of insurance. Also, firms no longer have to worry about the possibility of large premium increases if too many of their workers fall ill.
‘Ending discrimination’
An estimated 18 million to 24 million people in the United States have insurance through employers with fewer than 50 workers, and about 40 million have coverage through firms with fewer than 100 workers. The Department of Health and Human Services estimated in 2010 that up to 80 percent of small-group plans, defined as having fewer than 100 workers, could be discontinued by the end of 2013. But many small employers bought themselves extra time by renewing policies early through the end of 2014.
Jonathan Gruber, a key architect of the health law and a professor of economics at the Massachusetts Institute of Technology, said the number of people covered by small-group policies that will be discontinued is “not trivial.”
“We’re ending discrimination [against people who are sick, and as a result] the people who were previously benefiting may now suffer,” Gruber said. “That’s sad for them, but it does not mean we should continue discrimination.”
He said the change for most small businesses will simply be a “labeling issue,” with companies able to switch to similar plans at similar prices with the same carriers, although the plans themselves may have different names. A smaller group will have to pay more for a more generous plan. Gruber said the number of genuine “losers” under the health-care law — those who will have to pay more for the same or inferior coverage — is “very, very small.”
In November, President Obama, responding to criticism about widespread cancellation of individual policies, said insurers could extend policies that do not meet the law’s requirements for an additional year, if state regulators agreed. His announcement applied to small-group plans as well.
There is substantial turnover in individual and small-group policies every year, even without the health law. But insurers say the change that’s starting to occur is significantly larger than before.
In New Jersey, the state’s association of health plans says 650,000 people with small-group coverage have had their plans disrupted. In Colorado, regulators said small-group plans covering 143,000 people are being discontinued in 2014.
In New Hampshire, the state’s largest insurer, Anthem Blue Cross Blue Shield, is moving all of those in its small-group plan — 60,000 to 70, 000 people — to plans that are similar to those sold on the marketplace created by the health-care law. These plans have drawn fire from consumers because they include only 16 of the state’s 26 acute-care hospitals.
In Pennsylvania, Delaware and West Virginia, Highmark Blue Cross Blue Shield is discontinuing all its small-group plans for those who did not renew early, and offering new policies with different coverage and premiums. The company says 99.5 percent of the 5.3 million people it covers through its individual and small-group plans will be affected, but it declined to break out the number under small-group plans for competitive reasons.
Business for marketplaces
In Vermont and the District, regulators are making other changes in the small-group market. They are requiring small businesses and associations with fewer than 50 employees to purchase new policies through the government-run online marketplaces. The rules go into effect in 2014 in Vermont and 2015 in the District. About 39,300 people in Vermont are being affected, according to state regulators. The District requirement will be extended to employers with up to 100 employees in 2016; it could affect as many as 125,000 people.
Regulators took the step to try to ensure that the exchanges — the smallest in the country, by population served — would have enough young, healthy enrollees to offset the cost of older, sicker participants.
Judith Kennedy, president of the National Association of Affordable Housing Lenders, based in the District, recently received a notice informing her that the group’s small-group plan was being discontinued. She said she worries about the consequences as both an employer and as a parent.
“The notion that the plans on the exchanges may or may not limit providers scares a mom who has lived through chronic illness with her child,” she said.
Also facing disruption are people who purchase insurance through professional or trade associations and don’t have any employees. This includes some doctors, lawyers and accountants in solo practice. Under the health law, that type of association plan is not allowed; sole proprietors must purchase coverage on the individual market.
Cynthia Rutzick, 49, who has her own law practice in Oak Hill, Va., said that the policy she had been buying for years through the state bar association was already offering the benefits mandated by the health law.
But the policy, which cost $1,500 a month for herself, her husband and their two children and included 94 percent of the physicians in her area, was canceled. The new one, which costs $1,600 a month for her and her two children (her husband is going on Medicare next year) includes 82 percent of area physicians. Her broker said plans like her old one don’t exist anymore.
“So I had a blue car, but could not go out and buy another blue car,” she said. “I have to buy a red car, and it’s not as good and way more expensive.”
Workplace wellness in the new age of the ACA
Originally posted January 02, 2014 by Alan Pollard on https://ebn.benefitnews.com
With all the implications that the Affordable Care Act has on employer’s health insurance obligations, it’s easy to overlook its effects on workplace wellness programs. Yet these programs are very much affected by Obamacare.
Now that privacy and equality guidelines that previously only applied to insurers and providers are being applied to all sponsors of health promotion and prevention programs, the feedback we’re hearing is that many employers are either unaware or don’t understand what’s expected of them vis a vis their wellness programs in this new legal environment.
Some organizations that led the charge in workplace wellness in the last decade have mature programs targeting specific conditions such as obesity or smoking. These types of programs in particular face new hurdles presented by the final ruling, yet many companies don’t understand exactly what is needed to become compliant.
Further, some companies that have taken steps to modify their programs to be compliant are finding out firsthand just how complex re-engineering can often be — and how vocal some highly informed employees can be against changes.
For example, the protection of privacy of personal health information afforded by the Health Insurance Portability and Accountability Act has been legislated for a long time, but now puts additional restrictions on workplace wellness programs. How does a company that has long collected this type of information as proof of qualification for a reward or a premium subsidy handle this new obligation?
Other scenarios: How does an employer set up simple employee fitness events like a 5k walk or even a step test to obey the requirements for a reasonable alternative standard for those who cannot participate due to a physical disability or a physician’s recommendation? Or, how do you reward your employees for losing weight in a way that doesn’t alienate them by pressuring them to share sensitive information?
Whatever the structure, you must be able to prove your wellness program is, as the new law phrases it: “reasonably designed to promote health or prevent disease; has a reasonable chance of improving the health of, or preventing disease in, participating individuals; is not overly burdensome; is not a subterfuge for discriminating based on a health factor; and is not highly suspect in the method chosen to promote health or prevent disease.”
After spending more than two decades in the wellness industry, I’m very encouraged by the ACA’s strong recognition of the important role well-designed wellness programs play in promoting health, preventing disease and controlling the rising cost of care. However, the new regulations also include many important design requirements and consumer protections that raise the bar for wellness providers to deliver more professional and evidence-based programs, and for employers to be more aware of privacy issues, fairness and quality outcomes.
For CEOs this presents an opportunity to re-examine and elevate the standards for workplace programs, choosing the ones based on science-based evidence of measurable impact. For those in the wellness industry, this lays down both a challenge and opportunity to improve the quality and sustainability of interventions — especially those aimed at reducing obesity, tobacco use, physical inactivity and mental health.
We urge all responsible parties to thoroughly examine their wellness offerings for the ability to deliver all that the new law demands — and promises. And for employers, it’s important to make sure your business partners can ensure the ACA compliance of their programs.
6 health care trends for 2014
Originally posted by EBA https://eba.benefitnews.com
2013 was a pinnacle year in health care with the opening of the Affordable Care Act’s health care exchanges. But what can we expect in 2014? EBA spoke with experts across the spectrum to find out.
1. Complying with the ACA
The Affordable Care Act will continue to have a lasting impact into 2014. With the employer mandate pushed off and the penalties delayed as well, brokers will spend most of 2014 making sure their clients are complaint for 2015, says Mark S. Gaunya, principal at Borislow Insurance.
2. Losing coverage
In addition to focusing on compliance in 2014, Gaunya believes that many people will be in for a big surprise on Jan. 1 when “millions wake up and can’t see their doctor.” Gaunya predicts that many people who had coverage will lose it — 110,000 alone in his home state of Massachusetts — and some won’t even realize it until they go to the doctor.
3. Health care eligibility issues
With the ACA and Windsor decision on DOMA, employment lawyer Keith R. McMurdy of Fox Rothschild LLP believes many plan sponsors in 2014 are going to have problems with plan eligibility definitions. “Lots of employers don't really remember that changing eligibility and participation requirements requires an update of plan documents, revisions to SPDs and summaries of material modification,” he says. “I think that as the year progresses between litigation and EBSA audits we are going to see a lot of plans that have conflicting language over how they are being administered. “Plan sponsors that don't do complete review of these eligibility rules are going to find themselves in a world of hurt,” he adds.
4. Uneven risk pool hurts carriers
Insurance carriers whose plans are sold through the exchanges will issue earnings reports much worse than average in 2014, predicts Thom Mangan, CEO of United Benefit Advisors, due to the failure to enroll the young and healthy. Mangan says that after that happens the federal government will offer “some financial assistance to insurance carriers but not enough to make them whole.”
5. A small rise in health care costs
In 2014, the medical cost trend is estimated to be 6.5% by PricewatehouseCoopers Health Research Institute — one full percentage point below 2013’s estimate. After accounting for benefit design changes, such as higher deductibles, the net growth rate will be 4.5% in 2014, pWc predicts.
6. A request to drop coverage
In 2014, individual employees will realize they can get individual health coverage for less than their employer's group health plan, says Rick Lindquist, president of Zane Benefits Inc. “As a result, employees will start asking their employers to drop coverage, which will cause the small businesses health insurance market to implode in favor of defined contribution health benefits,” he says.
IRS limits PPACA group tax credit relief
Originally posted December 18, 2013 by Allison Bell on https://www.benefitspro.com
A few U.S. counties might have a slightly easier time using the federal health insurance tax credit next year.
The Internal Revenue Service has temporarily eased the qualification rules for the tax credit – but only for employers in five counties in Wisconsin and 37 of the 39 counties in Washington state.
The IRS will let small employers in those counties use the tax credit in 2014 without offering a health plan from a public health insurance exchange, according to IRS Notice 2014-6.
Carriers in the affected counties won’t be offering any small-group exchange plans in 2014, officials say.
Section 1421 of the Patient Protection and Affordable Care Act created the tax credit by adding Section 45R to the Internal Revenue Code.
Before 2014, any small employer with modestly paid employees could use the tax credit.
Once the Small Business Health Options Program exchange plans open, employers are supposed to use the credit to pay for SHOP exchange plan coverage.
What’s ahead in 2014 for PPACA
Originally posted December 18, 2013 by Nathan Solheim on https://www.benefitspro.com
Let’s be honest. In the history of American health care, the year 2013 won’t exactly go down as a time that went as smoothly as one of President Barack Obama’s campaign speeches.
At mid-year, most observers could see some of the downsides: rising premiums and dropped policies. Deadlines had to be pushed back, and some parts of the law demanded rewrite.
And by October — when the exchanges rolled out — there were (are) glitches with state websites and www.healthcare.gov, which prompted calls for Silicon Valley to rescue the $600 million mess. Tea Party Republicans partially closed the government in an attempt at political blackmail, while Democrats quickly distanced themselves from the program’s failures. It was difficult for any good news about PPACA — such as reduced premiums for some consumers and the ability for people with pre-existing conditions to buy coverage again — to cut through the media morass.
But even though PPACA implementation has been bumpy, it will continue — and 2014 will prove to be a pivotal year. Much of the law’s major provisions take effect next year, and yes, there are likely to be more delays or problems. Brokers can count on clients, employees and HR managers turning to them for advice on coming into compliance with the law and helping make decisions in the uncertain business environment ahead.
“In some respects, someone who’s new to insurance and is learning the new scheme — they’ll have an advantage because the stuff we used to know doesn’t apply anymore. It’s all new,” says Pamela Mitroff, director of state affairs for the National Association of Health Underwriters. “I answer the bulk of compliance questions from our members. I get 20–30 a day, and they’re not just one simple question. Many of them will have a page of questions.”
Here’s a look at what’s ahead in 2014 for PPACA:
The individual mandate
Beginning Jan. 1, 2014, Americans must buy health insurance from a private insurance provider or through a public program. While the glitch-marred exchange website debuted in October 2013, individuals must have insurance by Jan. 1 in order to comply with the new regulation. The penalty for failing to do so is either $95 or 1 percent of a person’s income — whichever is higher.
Market reforms
PPACA includes a bevy of market reforms — the most notable being that carriers will have to cover people with pre-existing conditions. Others include prohibiting lifetime limits, defining small employer groups as between 1–100 employees (some states can define as 50 employees until 2016), and limiting annual deductibles to $2,000. Brokers and agents point to PPACA’s edict on modified community ratings as a major factor in potential increases in the cost of plans. PPACA mandates a 3:1 community rating, while some states are as high as 8:1. Carriers also will not be able to charge more for women.
“You’ll see younger people with plans that go up in price, and the older folks, in all likelihood, stay where they were,” says Zach Zinser of Zinser Benefit Service in Louisville, Ky. “They’re going to raise the bottom up.”
Tax credits begin
Because of the individual mandate, Obamacare also includes tax subsidies for individuals to help them afford the cost of health insurance. However, the tax credits are dependent on annual income and access to private plans. Brokers have answered a lot of questions from employees about whether they qualify for a tax credit and will continue to do so.
“The No. 1 question I get is, ‘Am I eligible for a subsidy?’” says Trish Freeman of Trish Freeman Insurance Service in Gonzalez, La.
“When people hear Affordable Care Act or they hear comments from [The Department of] Health and Human Services or the president, they’re expecting something affordable,” says Darlene Tucker, owner of Darlene Tucker Insurance and Financial Planning in Scotts Hill, Tenn. “And they may or may not find it affordable. We’re going to see a lot of people where the premium is not affordable. And I think we’ll still see people who can’t afford the premium who aren’t eligible for the subsidy.”
New tax No. 1
To help pay for it, architects of the law built in several new taxes and fees on carriers. Perhaps the most expansive is called the Health Insurance Tax, which is expected to generate $8 billion in 2014 and more than $100 billion over 10 years, according to America’s Health Insurance Plans. Several groups — and unions that have negotiated top-shelf plans for their members — have started lobbying to repeal the tax.
New tax No. 2
Another tax comes in the form of the “transitional reinsurance fee.” A fee of $63 for each life covered on a health insurance plan will be collected yearly from carriers. The fee will be first be collected in 2014, and it will continue being collected through 2016. The fee is supposed to offset the extra cost of covering people with pre-existing conditions.
Brokers and agents credit these two new taxes and others as contributors to premium increases across the country.
“Those are all taxes that will be built into the price now,” Zinser says.
Medicaid expands
Medicaid — the state-federal program that provides health coverage for the poor — will expand to cover individuals whose incomes are 133 percent of the federal poverty level. Some states have opted not to take part in the Medicaid expansion.
Health care co-ops
Co-ops will be allowed to compete for consumers on the exchanges. An Oct. 22 story in theWashington Post, however, reported some co-ops are in trouble and might not have enough funding to adequately begin operations. In some states, though, co-ops have launched.
“Unfortunately, when everyone in Michigan had to submit their rates, it was a guessing game, and [the co-op’s] rates are higher,” says Denise Van Putten, an account executive with the Grand Rapids, Mich.-based Lighthouse Group. “I think a co-op is a good idea if we can get the rates to be competitive.”
Freeman pointed out the relative youth of the co-ops — many of which were created during the time since Obamacare’s passage — could affect consumers’ perception about their quality and affordability.
“In Baton Rouge, there are two companies on the exchange — we have Blue Cross and the Louisiana co-op,” Freeman says. “People are a little leery about companies they don’t know anything about.”
Minimum standards
All health insurance policies must adhere to standards set forth under PPACA. People who’ve lost policies in 2013 and those who will continue to lose coverage in 2014 will do so because their existing plans don’t meet 10 minimum standards mandated under PPACA.
Those standards include:
- ambulatory patient services
- emergency services
- hospitalization
- maternity and newborn care
- mental health and substance use disorder services, including behavioral health treatment
- prescription drugs
- rehabilitative and habilitative services and devices
- laboratory services
- preventive and wellness services and chronic disease management
- pediatric services, including oral and vision care
Waiting periods defined
Also starting Jan. 1, the waiting period for people to sign up for health insurance will be set by PPACA. Waiting periods of more than 90 days will be prohibited for all health plans. Brokers and agents say this provision mainly affects businesses and industries that experience high turnover.
Wellness worth more
PPACA also allows employer-sponsored wellness programs to increase the value of incentives. After Jan. 1, employers can increase the value of incentives to 30 percent of premiums. For reducing tobacco use, employers can increase the maximum reward up to 50 percent.
Factor in the new regulations with parts of the law that are already in effect, and brokers and agents agree that there has been a profound impact on the individual and small-group markets. Some warn that the market could disappear, while others say the market can withstand Obamacare’s regulations.
“For brokers that work in the small-group arena, the vast majority of groups with under 50 employees are going to look at dropping their coverage,” Tucker says. “That’s been my opinion since the law passed, and nothing has happened to change my mind.”
Van Putten says that among the more than 500 small groups he manages, less than 10 percent will drop their coverage.
“The rates out there for individuals are high,” she says, “so they’re completely different from the group plans.”
So as 2014 looms, brokers around the country are continuing to advise clients. But they’re also looking around for new opportunities and developing strategies to keep their own businesses afloat. Some have advised a wait-and-see approach, while others have been more aggressive.
Freeman says at the end of the day, it’s about helping clients.
“I can’t bail on them,” she says. “I can’t leave them with a navigator — someone who’s had 20 hours of training when I’ve had 20 years of training. I will get my clients through this, and as long as I don’t lose money in the future, I’ll be here.”
Efforts To Fix Health Care Draw Mixed Reviews
Originally posted November 18, 2013 by Pamela Dockins on https://insurancenewsnet.com
WASHINGTON - U.S. President Barack Obama is taking steps to correct problems that have plagued his health care reform program since its launch in October. There is debate over whether the president has made enough changes to the program to quell discontent.
The Obama administration says it is working to fix problems with the government's health care website.
Many Americans have been frustrated by the site's technical glitches, which have prevented them from buying health insurance.
This past week, Obama offered a fix to another problem that is causing some Americans to lose their health care policies under his new program. The president said insurance companies could now give these people the option of keeping their old plans for an extra year.
"Now this fix won't solve every problem for every person but it is going to help a lot of people," said the president.
Michael Consedine, the insurance commissioner of Pennsylvania and secretary-treasurer of the National Association of Insurance Commissioners, said the president's fix could wind up causing confusion. "That fix is a very temporary one and may ultimately cause far greater harm to the insurance marketplace in allowing different products and different policies to continue in a marketplace where we thought there would be a lot more uniformity."
On Friday, the Republican-majority House of Representatives voted to make even more changes. A bill passed with the support of some House Democrats that would allow insurance companies to sell policies that lack all the health care reform mandates and renew customer policies that had been canceled.
The bill's fate in the Senate is uncertain.
Consedine said rapid changes in insurance policies and rates could become problematic at the state level. "We really are feeling like sort of like a ship out on the waves being tossed and turned. The prevailing winds go one direction one day and another the next."
Anne-Marie Slaughter is a former director of policy planning at the State Department and the current head of the New America Foundation, a public policy institute. On VOA's Press Conference USA, she predicted Obama would be able to weather the health care storm.
States to decide which plans are PPACA-compliant
Originally posted November 21, 2013 by Arthur D. Postal on https://www.lifehealthpro.com
States will be the ultimate determinant as to whether they will allow insurers to renew existing health insurances plans in 2014 even though these policies may not comply with the new Affordable Care Act, President Obama and state insurance regulators agreed at a White House meeting last night.
The meeting with several insurance commissioners and Ben Nelson, chief executive officer of the National Association of Insurance Commissioners, was held as the White House continued itsefforts to smooth the troubled political waters caused by the rocky rollout of the federal exchange that will be used by residents of 36 states to buy individual and small group policies mandated by the law.
The state regulators used the occasion to raise other issues with the president, including their relationship with federal insurance regulators given a voice in insurance regulation left to the states for 150 years. A major issue brought up with the president was the role they want to play in establishing international insurance standards.
As for the healthcare, law, under the Patient Protection and Affordable Care Act, everyone must have health insurance by March 31, 2014, or pay a penalty. However, the exchange website unveiled Oct. 1 has proved unequal to its task, and there are questions whether it will be fully up to speed by the end of the month, as promised by the administration.
The inability of people to access the website, plus the realization that the president’s commitment to allow everyone to “keep their existing policies if they like them” contradicts the law’s mandate that each insurance policy must contain certain essential benefits, has generated a major political problem for the president.
These essential benefits include providing insurance to people with pre-existing conditions, free preventative care, maternity coverage and other benefits. Also included is a requirement to provide contraceptives for women.
However, the realization that most existing policies didn’t include such benefits created a major practical problem as insurers notified thousands of affected consumers that their existing policies would be cancelled.
As the meeting was being held, CareFirst BlueCross Blue Shield, which serves Maryland, announced that it would allow more than 55,000 policyholders to retain their policies for one year even though the policies don’t contain some of the essential benefits mandated by the new law. CareFirst acted one day after the Maryland insurance commissioner said he would approve such action. Other health insurers in the state said they would also do so; others said they would not.
Other states, like Florida, said they would also allow consumers to keep their existing policies for one year. But, others, like New York, Washington and Indiana, said they would not comply. CaliforniaInsurance Department officials said they would announce their decision today.
At the meeting, the state insurance regulators emphasized their concern that different rules for different policies would be detrimental to the overall insurance marketplace and could result in higher premiums for consumers, without addressing the underlying concern of gaps in coverage. They also emphasized the importance of deferring to the states to protect consumers, and highlighted the track record of effective regulation by insurance departments across the country.
However, they acknowledged that they are just standard-setters, not policymakers and reiterated, as stated by Jim Donelon, NAIC President and Louisiana insurance commissioner, that PPACA is “the law of the land."
“Since the passage of ACA, state regulators have been working to ensure that plans are compliant with the new rules,” Donelon said at the meeting.
He said the proposed changes announced by the president in an executive order last Thursday in response to the uproar over the cancellations and the difficulty consumers are having buying policies on the federal website has creating “a level of uncertainty that we must work together to alleviate.”
Donelon made clear, however that state regulators “share the President’s goal of affordable coverage for consumers, and we will work with the insurance companies in our states to implement changes that make sense while following our mandate of consumer protection.”
Donelon attended the meeting with NAIC Chief Executive Officer Senator Ben Nelson, Connecticut Insurance Commissioner Thomas B. Leonardi, and North Carolina Insurance Commissioner Wayne Goodwin.
The group discussed practical implications of implementing the delay in enforcement as well as outstanding questions regarding what specific provisions would be impacted, and talked to reporters at length at what was accomplished at the meeting in a conference call afterwards.
Amongst the presidential aides attending the meeting was Kathleen Sebelius, secretary of the Department of Health and Human Services. Sebelius and officials of the Centers of Medicare and Medicaid Services, which oversaw development of the website, have been under intense fire because the website has failed because of the huge numbers of people who sought access to it, and because testing designed to prove it worked was not even started until a week or so before the Oct. 1 rollout.
The White House released a statement saying the state regulators had been given full authority as to whether to accept the grandfathering. According to the statement, Obama said that his executive order requires that health plans that offer such renewals provide consumers with clear information about consumer protections lacking in those plans and their options and possible tax credits through the exchanges. The statements said that Obama acknowledged that, “States have different populations with unique needs, and it is up to the insurance commissioner and health insurance companies to decide which insurance products can be offered to existing customers next year.”
Additionally, according to the White House statement, the president emphasized that he wants to hear any ideas that insurance commissioners “may have as implementation continues to ensure that Americans across the country have the information they need to get affordable, quality coverage for themselves and their families.”
Survey: Employees still under-informed on ACA, wellness
Originally posted November 8, 2013 by Tristan Lejeune on ebn.benefitnews.com
Only 15.1% of workers at large employers say they are “knowledgeable” or “very knowledgeable” about health care reform and the Affordable Care Act’s public exchanges, and nearly one in five can’t say for sure if their company has a wellness program or not, according a recent survey. The poll’s results, released this month, speak to a population that has confidence in the communication efforts of their benefits administrators, and that points out some serious shortfalls in that communication.
The survey, which spoke with 400 employees at companies with north of 2,000 each, found that only 29.5% could correctly identify times when they can make changes to their health plans, like open enrollment, according to the Jellyvison Labs. Jellyvision, which created ALEX, a virtual employee benefits counselor, says all but one of the employers involved in the survey offer health insurance, but employees still demonstrate large education gaps on their own benefits.
More than 90% of surveyed workers say it’s at least “somewhat important” to understand ACA and its implications, but less than a fifth actually consider themselves knowledgeable. The good news is employee confidence in their employers’ ability to communicate the necessary information is high: nearly 80% think their companies can properly bring them up to speed, and more than one in three rate their confidence levels on this point at eight or higher on a 10-point scale.
Some 77.6% of those polled agree that it is at least “somewhat important” for their organizations to offer a wellness program, but almost one-fifth don’t know with any certainty whether or not their company does so.
“One of the most important things we learned from this data,” says Josh Fosburg, vice president of business development for the Jellyvision Lab, “is employees aren’t getting everything they need to know about their employers’ wellness programs and other benefits. For instance, nearly half of employees in our survey think they have to pay something in order to take advantage of the wellness programming that will help them manage their weight, stay on top of their prescribed medications, or cease smoking. That’s bananas.”
Jellyvision says employers need to “up their communications game” in order to help employees take advantage of everything included in their benefits offerings.
For one year, White House revives health plans canceled under ACA
Originally posted November 14, 2013 by Tristan Lejeune and Brian M. Kalish on https://ebn.benefitnews.com
President Barack Obama announced that Americans whose health care plans have been canceled because they fall short of Affordable Care Act standards have been granted a one-year reprieve. With the decision, state governors and insurance commissioners would have the authority to keep would-be canceled plans active until the end of 2014.
“The Affordable Care Act is going to work for the American people,” Obama said from the White House briefing room in remarks that opened with sympathy and support for the typhoon-ravaged Philippines. Obama acknowledged that his team “fumbled the roll-out of the health care law,” but he hopes that extending existing plans will help win “back the confidence of the American people.”
The decision, which helps live up to a promise Obama made when pushing for passage of health reform, is couched as an administrative fix that says following ACA will not require insurance companies to upgrade their plan for individuals who have been in these existing plans so far. In what the White House is calling “an extension of grandfathering principle” Americans should now all be able to re-enroll in their current coverage so long as it is still offered by their provider.
“Two important things we require from insurance companies,” says the administration, “one is they notify consumers what protections these renewed plans do not include. And two, they notify consumers that they will have new options available on the marketplace that offer better coverage, and tax credits are available for many people.”
Insurers and participants in the individual and small group markets will not be considered noncompliant in these plans next year. This is a policy “targeted and very targeted” to those individuals who are in those policies today, it is not allowing to be sold to people not in plans. IN other words, the policy change only applies to extant plans; all new plans must comply with Obamacare in full.
Next year is an election cycle for 33 senators and the entire House of Representatives. This move will widely be seen as trying to appease voters furious about having their plans canceled after pledges were repeatedly made that exactly that would not happen.
State authorities can still decide to consider plans non-compliant next year and insist insurers get up to speed.
Obama said that Healthcare.gov enrollment is “absolutely not” where he wants it to be, “but there’s no question that there’s great demand for high-quality health care,” and he urged health care consumers not to try to throw out the baby with the bathwater and return to the landscape circa 2009.
“It’s important that we pretend that that’s not a place worth going back to,” Obama said. “And that’s why I will not accept proposals that are just a brazen attempt to overturn the law and go back to a broken system.”
He added: "This fix won't solve every problem for every person but it will help a lot of people. Doing more will require work with Congress."