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Wednesday, March 30, 2011

How the State of California is Implementing Health Reform

In just one year, hundreds of thousands of Californians have benefited from the Affordable Care Act (ACA), according to a report by Linda Leu and Anthony Wright of Health Access. Their detailed report explains how access to healthcare in California is changing as a result of health reform. The following is a summary of the report including descriptions of actions that the state has already taken to implement healthcare reform as well as pending legislation.

By this time next year in 2012, even more Californians will see additional benefits from the Affordable Care Act, most notably low-income adults getting county based coverage. In addition, California’s Exchange will be putting the pieces together to begin enrollment in late 2013.

California, which has been trying for years to reform healthcare on the state level, was quick to take advantage of the new benefits and opportunities. This includes applying for new federal grants, passing legislation to implement and expand upon federal law, negotiating a Medicaid waiver with the federal government, and issuing new regulations and oversight of insurers.

On September 30, 2010, then-Governor Arnold Schwarzenegger signed about a half-dozen bills passed by the California State Legislature, bringing state law into compliance with the ACA. In some cases, the laws go beyond federal requirements. The legislature has introduced more than a dozen bills to continue to implement the federal health law.

Health Access says that California will need to adapt its individual market laws to the Affordable Care Act by January 1, 2014, so insurers cannot deny people with pre-existing conditions or charge different rates to cover them. The Pre-existing California Insurance Plan (PCIP) is ramping up its outreach and enrollment efforts, so the state can draw down as much of the $761 million (and potentially more) of federal funds available for California. The following is a description of how specific programs have changed.

Small Business Tax Credits
(Editor’s note: Small businesses will get incentives to purchase coverage through state-run health exchanges.) Starting in March of 2010, small business owners became eligible for tax credits of up to 35% of the their contribution to a health plan. Beginning in 2014, if they purchase coverage through an exchange, they will get tax credits of up to 50% of their contribution.

The tax credit applies to employers with fewer than 25 full-time employees that contribute at least 50% of the total premium. The full credit is available to businesses with fewer than 10 employees averaging less than $25,000 annual wages and phases out at $50,000. Non-profits qualify for up to 25% in tax credits.

The Healthcare Exchange
A lot of work is needed to get California’s Healthcare Exchange program ready for implementation by 2014 including hiring staff, building IT systems, providing for easy enrollment in coverage and eligibility in getting federal subsidies, organizing the marketplace so consumers can make good decisions, and setting up processes to negotiate for the best value for individuals and small businesses. Four of the five appointments to the Exchange board have been made and a first meeting is expected in the next month.

Rate Reviews
California received $1 million in federal funding to ramp up rate reviews. The Department of Insurance and Department of Managed Healthcare will be implementing new rate review procedures and looking closer at insurance company rate filings. AB 52 (Feuer), which would give the state the authority to approve or deny rates, is pending in the Legislature. Another bill, AB 51 (Alquist), would conform state law to the new rules on medical loss ratios; so at least 80% to 85% of premium dollars go to patient care, rather than administration and profit.

Small Group Rating
A bill in the California Legislature this year, AB 1083 (Monning), would establish reforms in 2014, so that small businesses don’t face price hikes when a few of their workers get sick.

Preventive Care Requirements
Up to 31 million Americans are expected to benefit from the requirements for private health plans to offer preventive services with no cost share for consumers. Many screenings, immunizations, and other preventive services are now available to consumers with no co-payments, co-insurance, or deductibles. Last year, Governor Schwarzenegger signed, AB 2345 (De La Torre), which puts the federal protections into California law.

Rescission Restrictions
Health plan rescissions had already decreased in California due to increased media and regulatory oversight, but legislative action was still pending. In 2010, Governor Schwarzenegger signed AB 2470 (De La Torre) to implement the new federal standards for rescission. California improves upon federal law with requirements that insurers continue coverage pending determination of rescission.

Lifetime Caps on Coverage
On September 23, 2010, the ACA required plans to begin phasing out annual limits. ACA bans all lifetime limits.

Coverage For Young Adults
An estimated 196,000 young adults are now eligible to stay on their parents’ coverage. Starting September 23, 2010, the ACA allowed parents to keep their children on their health insurance plans up to age 26. This could assist up to 4 million young adults nationwide and 196,000 in California. In 2010, California passed SB 1088 (Price), which conforms state law to federal law with regard to this new option for children up to age 26. CALPERS reports that 27,000 young adults are getting such coverage among its membership.
Starting in 2011, young adults who meet certain income requirements will also be eligible for the Low-Income Health Programs, which are county-based Medicaid expansion programs. In 2014, young adults will be among the nearly four million Californians who can get income-based subsidies for purchasing coverage through the Health Benefits Exchange.

Medicare Expansion
As many as 269,623 seniors and people with disabilities in California fell into the Medicare Donut Hole last year — a gap in coverage that required them to pay thousands of dollars out of pocket for prescriptions. Last year, 269,623 beneficiaries in California got $250 rebate checks. Starting in 2011, a 50% discount on prescriptions will close the coverage gap further. Additional measures will phase out the gap over the next several years. Preventive services, such as colorectal cancer screenings, mammograms, and annual wellness visits are now available to seniors enrolled in Medicare with no copayments, co-insurance, or deductibles. This will mean savings to 4.5 million seniors in California.

Over the next 20 years, the Affordable Care Act will slow Medicare spending by reducing waste, fraud, and abuse. These fraud prevention measures and other savings are expected to extend the financial solvency of the Medicare program by 12 years. These measures are also expected to lower out-of-pocket costs to beneficiaries. In 2018, beneficiaries can expect to save almost $200 a year in premiums and more than $200 a year in coinsurance. At the state level, one bill in consideration, AB 151 (Monning), would ensure guaranteed issue for seniors who switch from Medicare Advantage plans to Medi-gap coverage, regardless of health status.

Coverage For Pre-Medicare Retirees
Under ACA, $5 billion is available for a new reinsurance program to provide financial assistance to employers and union based plans covering early retirees ages 55 to 65. This includes 430,000 Californians who retired before they were eligible for Medicare. More than 100 California employers, union trusts, and others have received funding. A number of states have used reinsurance to lower premiums for small businesses. Savings for the plans will have to be used to lower costs for the enrollees.

Enrollment in Public Health Programs
Health Access said that California needs to streamline its eligibility and enrollment systems to make it easy to enroll in Medi-Cal, Healthy Families, subsidies in the new Exchange, or private coverage.

Medicaid Funding
A new Medicaid waiver, approved last year, takes advantages of opportunities under the ACA to provide $500 million in state budget fiscal relief to help prevent further Medi-Cal cuts. The ACA also establishes funding for innovations like healthcare homes and community health teams. It also increases funding to community clinics that provide Medicaid services and increases provider reimbursement in 2013.
California must conform to Medi-Cal rules in order to expand the program, in 2014, to those who are up to 133% of the poverty level — including adults without children at home. The federal government will fund 100% of the coverage of newly eligible enrollees for the first three years. The state must reform eligibility and enrollment procedures to streamline how Californians get coverage, so that it will be ready to enroll as many Californians as possible. Several bills advance these goals, including AB 43 (Monning), SB 677 (Hernandez), AB 1296 (Bonilla), AB 714 (Atkins), and AB 792 (Bonilla).
All California counties are working on plans to implement Low Income Health Programs. These programs use existing county health dollars and new federal matching funds to provide coverage to low income adults earlier than 2014. Under the state’s Medicaid waiver, counties can begin providing Medicaid-like coverage, this year, to medically indigent adults up to 200% of the Federal Poverty Level through the Low Income Health Programs (LIHP).
Implementation of the Medicaid waiver will continue including efforts to monitor how public hospitals are meeting their goals to improve quality and capacity. Starting this year, $9.5 billion in new funding will allow health centers to expand their services. They will be able to treat an additional 20 million patients and expand their medical, oral, and behavioral health services. Health Access says that Congress needs to protect funding for community clinics.
For more information, visit www.health-access.org.

Tuesday, March 29, 2011

Amsinsure.com - Torrance, CA - Insurance Agent in Torrance, California

Amsinsure.com - Torrance, CA - Insurance Agent in Torrance, California

SIS Rider - Social Insurance Supplement Rider --- What is this?

This is a rider that can be added TO A DISABITY POLICY that reduces the premium by a small amount. The client still gets the full benefit amount at claim time (both base and SIS rider amounts). However - it requires the client to apply with social security, or any other social benefit that might be available. IF social security pays anything - then that benefit is integrated dollar for dollar with only the SIS rider amount. Unless it is required by the company - is this rider worth it? Call and we will let you know what is best for you.

Wednesday, March 23, 2011

Integrated Delivery Health Plans Score Higher with Members

  • Health plans members are more satisfied with health plans that share characteristics of integrated delivery systems (IDS), according a J.D. Power study. Another major finding is that, in 2011, member satisfaction with health plans, in general, is at the lowest point since the study’s inception in 2007, averaging 696, compared to 701 in 2010. Member satisfaction with coverage and benefits has decreased slightly. Members expressed considerable declines in satisfaction with communication, claims processing, and statements.
Now in its fifth year, the study measures member satisfaction among 137 health plans in 17 regions throughout the United States by examining seven key factors: coverage and benefits, provider choice, information and communication, claims processing, statements, customer service, and approval processes.
Satisfaction with integrated health plans, such as Health Alliance Plan and Kaiser, averages 741 on a 1,000-point scale compared to 691 among members of plans where care is not integrated. In addition, members of integrated plans have a better understanding of their coverage and the processes necessary to get services. Sixty-three percent of integrated plan members say they completely understand the benefits covered, compared to 52% of non-IDS plan members. Forty-four percent of IDS plan members say they completely understand how to get preventive services while just 24% of non-IDS plan members say the same.
Richard Millard, senior director of the healthcare practice at J.D. Power said, “An advantage of these plans is that interactions center on the member as a patient because the provider and plan are integrated. The higher level of satisfaction with integrated plans is particularly important with the passage of the Affordable Care Act, which will result in the creation of accountable care organizations modeled after the IDS approach.
Members of integrated plans tend to be more satisfied with information and communication as well as coverage and benefits. “Information and communication remains the factor with lowest satisfaction among all plans, possibly reflecting the increasing complexity of health benefits. Because members are increasingly concerned about the uncertainties surrounding cost and coverage, plans that focus on delivering useful information to manage these changes tend to earn higher satisfaction scores,” said Millard.
Fifty-seven percent of health plan members chose to make changes involving cost or coverage during the past year or were required to do so – continuing a trend in which more members say they are powerless to control their healthcare costs.
With individual plans, satisfaction averages 667 points compared to 700 points with group health plans.
Exchange-based purchasing may result in further growth of the individual market, but it is not yet well understood. However, only one-half of all members think that by 2014 they will continue to purchase health insurance as they do now.
For more information, visit http://www.jdpower.com/healthcare/ratings/member-health-plan-ratings

Monday, March 14, 2011

What employers should know; Non Discrimination by employers in Health Benefits is comming!

Non-discrimination testing, is going to be very similar to non-discrimination testing for pension and 401k plans but specifically relates to the components of the health insurance coverage versus the employer contributions to the premium cost.  The testing will look at items such as deductibles, co-pays, coverage, etc. and ensure that the highly compensated individuals are not receiving a "richer" benefit than the non-highly compensated, similar to retirement plan testing.

All non-discrimination testing related to health care programs will commence in 2014, or at least that is the predicted date at this point in time.  Employers, however, should be thinking about requirements that will begin in 2012 for the reporting of employer contributions to health care premiums.  This information will have to appear on W-2's given to employees in 2013 for wages, etc., earned in 2012.

Wednesday, March 09, 2011

Opportunities Grow for Workplace Disability Sales

Seventy-one percent of companies surveyed said that group long-term disability insurance is extremely or very important. The study by Mass Mutual and The American College also reveals that many companies have shortfalls in their plan designs. On average, only 60% of employees’ base salary is covered by a group long-term disability insurance program. Only 27% of group long-term disability insurance programs include variable compensation — leaving bonus and commission income unprotected.

The majority of group plans offer a basic foundation of coverage, but limit benefits for high earners. Surprisingly, just one-quarter of companies are considering making changes to their group long-term disability insurance program.

Tara Reynolds, cor
porate vice president for MassMutual said, “It’s a real travesty that employees are being left exposed when they don’t need to be and when they may not be aware of it. While group long-term disability programs provide strong foundational coverage, they may not meet the needs of all employees and they do not cover all sources of employment income.” The opportunity to purchase buy-up coverage through a group long-term disability insurance program is not widespread, with only 25% of employers offering this option to some or all employees. Only 15% of companies surveyed offer individual disability income insurance to supplement their group plan. Cost and administrative burden were cited as reasons why companies do not offer individual disability income insurance coverage, along with the option that employees can purchase it on their own outside of work.

The study points out that individual disability income insurance can provide consumers with portable protection. Employ

ees who purchase individual coverage through the workplace get discounted premiums and simplified underwriting. For increased protection, employees can select riders for catastrophic coverage or retirement contribution protection. For more information, visit www.massmutual.com/DIstudy.

Health Savings Accounts Surpass $10 Billion in Total Deposits

Health Savings Accounts (HSAs) surpassed $10 Billion at year-end 2010, according to a survey by Devenir, an investment firm that specializes in providing investment options for HSAs. HSAs continue to see dramatic growth as the total number of HSA accounts rose to 6.2 million with assets totaling almost $10.1 billion, a year over year increase of 27% for accounts and a 41% increase in assets.

Jon Robb, lead research associate with Devenir said, “The industry has experienced tremendous growth and is likely to continue growing at this pace.” However, when looking back at a number of HSA market reports dating back 2005 to 2007, almost always the conservative 2010 projections were the most accurate. Taking this into consideration, Devenir conservatively projects the HSA market to reach $61 billion in assets by the end of 2015. Devenir also projects that HSA investment dollars will continue to grow quickly as health savings account user’s balances become larger, representing 17% of all HSA assets by the end of 2015.

The top five custodians hold over $4.4 billion in HSA assets amongst almost 2.7 million accounts, accounting for 44% of all HSA assets. The average account balance grew almost 11% in 2010 to $1,627. HSA investment assets reached  $725 million in 2010 (102% year over year increase) and are projected to reach $10.3 billion by end of 2015. For more information, visit www.devenir.com.

Thursday, March 03, 2011

The Top Employee Wellness Concerns

More than one-third of employees say that weight loss is their top health concern this year and 23% say stress is their main health concern, according to a poll by ComPsych Corporation.  Dr. Richard A. Chaifetz, Chairman and CEO of ComPsych said, “With more and more individuals slipping into the overweight category, it’s no surprise that weight management is a top issue this year.

Stress levels are also unusually high, given the additional workloads many have taken on during a recovering economy.” Employees were asked: Which health issue are you most trying to stay ahead of this year? They said the following:
  • 39% cited losing weight.
  • 23% cited reducing stress.
  • 22% cited exercising.
  • 7% cited improving diet.
  • 5% cited quitting smoking.
  • 4% cited other.
We can assist you in putting together a program for you company; info@amsinsure.com

Tuesday, March 01, 2011

Obama Would Allow States To Opt Out Of Healthcare Law In 2014

Media reports and analyses are treating the President's announcement that he was endorsing an accelerated schedule to allow states to opt out of his healthcare reform law as a significant concession to his Republican opponents, as well as an attempt to reach out to the nation's governors grappling with budget deficits. Ultimately, however, some of the law's supporters argue that the President's announcement will enhance the Administration's legal case as it strives to defend the law in court.
        The story generated print coverage and some cable and local TV reports, but was not mentioned on the network newscasts. USA Today (3/1, Wolf, Jackson) reports that in his remarks, Obama endorsed legislation originally proposed by Sens. Ron Wyden and Scott Brown which "would give states" the freedom to opt out of the legislation, though not "entirely," by 2014. Still, "key requirements would remain, such as those prohibiting insurers from canceling coverage because of pre-existing conditions."