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Monday, July 30, 2012

What Will Employers Do, As Health Care Reform takes hold?


Many believe that employer behavior over the next few years will be what makes or breaks health reform. Over the last few years, with the economic downturn many employers have reduced or dropped coverage. PPACA and its underlying financial assumptions are built on the premise that employers will keep being the primary providers of private health insurance benefits in this country during the years to come. But expert opinions vary widely about how the new law will impact group coverage when fully implemented in 2014.
Several surveys, studies and articles released this past week give a bit of a clue as to what employers are thinking when it comes to health reform and providing benefits to employees. For instance, this past week, a Gallup survey showed that of all groups of American voters, business owners who make our country's hiring and benefit decisions are the most disproving of President Obama and his policies. Ironically, their highly paid professional employees are the group most pleased with the President. 
Those same employers are trying hard to manage their health care costs right now. A new study by America's Health Insurance Plans (AHIP) shows employers are increasingly likely to select consumer-directed plans as part of their employee benefit offerings, even though these same plans could be limited in the future by impending PPACA insurance market reforms. Meanwhile, some employers are trying to use PPACA benefits to their cost-advantage in perhaps an unintended way. Kaiser Health News reports this week that some employers are incenting their younger employees to stay on their parent's employer-provided plans as long as possible as a means of reducing their own healthcare costs.
It seems like an uncertain future is just too much for some employers to handle. The headline from a Deloitte survey out this week shows that one in ten companies plan to drop coverage. But that’s not all the study revealed. Most employers say their company is “not well prepared” to implement the 2014 provisions of PPACA.  And while 30% think PPACA is “a good start,” 59% see it as “a step in the wrong direction.” Showing corresponding data with the Gallup poll referenced above, there was a wide range of opinions reported, from Human Resources who responded more positively to executive-level respondents who think it's a step in the wrong direction.
Perhaps a reason why is that, despite a lot of rhetoric, neither Republicans nor Democrats have done much to make health reform an easier pill for employers to swallow during the 111th Congress. Yes, there are some House-passed measures to make things easier for businesses stacked up that the Democratically-controlled Senate won't consider. But most of them aren’t health reform-related, and other than the out-and-out repeal bills, not too much health reform legislation is moving through the House. There are a number of business-friendly health reform measures with widespread, and even bipartisan support, including straight repeal bills.  Most haven't even been allowed by the GOP leadership to make it through the committee process, let alone be voted upon on the floor. These would include, among others, H.R. 1744, which would repeal the employer mandate, H.R. 605, 369 and 2010, all of which would improve group access to consumer-directed health insurance options in the future, H.R. 436 to repeal the medical device tax, and H.R. 1206 to fix the MLR requirements for agents and brokers and H.R. 2077 to completely repeal them. It goes without saying, nothing to make it easier for businesses to deal with health reform is currently moving through the Democratically-controlled Senate either.
Bottom line, policymakers on both sides of the aisle need to get a lot more business friendly if they want to fix our economy, reduce costs, and keep employer dollars in our healthcare system in the years ahead. Perhaps our nation's employers need to more clearly articulate the need for change. Some analysts believe they're the key to breaking the gridlock in Washington.

CBO Score: The Good, The Bad and The Ugly


The Congressional Budget Office (CBO) issued its much anticipated updated “score” of PPACA on Tuesday, July 24, as well as, a new cost estimate for repealing the legislation. Bottom line, the CBO’s projections of how much the law will cost the federal government over the next 10 years as a result of the Supreme Court’s ruling in NFIB v. Sebelius contained both good news and bad news for health reform supporters. It also contained the ugly news that the price of individual health insurance coverage is about to go up even more for everyone. 
On one hand, supporters of the law must be pleased that the CBO found that completely repealing PPACA would increase the federal deficit by $109 billion between the years 2013 and 2022. Also, the office determined that as a result of the Supreme Court's ruling on Medicaid, the coverage provisions will be $1.168 trillion over the next 10 years, which is $84 billion less than what had been projected in March prior to the Court's ruling.
On the other hand, people who like the new law can’t be happy that part of the reason why the law is now much less expensive is that it will provide coverage to far fewer people. The CBO clearly stated "fewer people will be covered by the Medicaid program, more people will obtain health insurance through the newly established exchanges, and more people will be uninsured. The magnitude of those changes varies from year to year."  While the CBO couldn’t predict the number of people who would no longer have access to coverage exactly, their best guess was about 3-4 million additional individuals remaining uninsured. 
The CBO didn’t attempt to predict which states would or would not expand their Medicaid programs. However, they did take a stab at guessing how many people would live in states that will either completely or partially expand their programs, as well as guess how many will live in places that do not grow their programs at all.   The CBO concluded that about one-third of the potential newly eligible Medicaid population will reside in states that will fully expand coverage under the law’s parameters (i.e., up to 138 percent of poverty). These individuals will be enrolled in Medicaid, as they would have been prior to the Supreme Court ruling.
The CBO also indicated about half of the population who could be newly eligible for Medicaid will live in states that will only partially expand their Medicaid programs (i.e., raising the eligibility level for populations higher than exists currently, but not up to 138 percent of poverty). This is an interesting assumption, because many policy wonks, including your Washington update author, didn’t feel that the Supreme Court ruling was clear on what happens in states that choose to only partially expand their programs and the Obama administration hasn’t been particularly forthcoming about its views as to whether or not the expansion is an all or nothing proposition for the states.
 
The CBO concluded that 1/6 of the population that was intended to be covered by Medicaid by the health reform law lives in states that will not expand their Medicaid program at all over the next 10 years. In total, the CBO assumes that about 6 million fewer people will be enrolled in Medicaid under the law due to the ruling. They feel that between 2-3 million of these people will receive via exchanges instead, meaning that 3-4 million will remain uninsured.
Finally, the CBO included the following paragraph on page 15 of its analysis of the Court ruling, which we find to be particularly disturbing, given that this is the “Affordable Care Act”:
“The additional enrollees [i.e., those previously projected to enroll in Medicaid, but who will now receive Exchange subsidies in light of the Court’s ruling] are likely to spend more on health care, on average, than those previously expected to purchase insurance through the exchanges because people with lower income generally have somewhat poorer health.  As a result, CBO and JCT now estimate that the premiums for health insurance offered through the exchanges, along with premiums in the individual market, will be 2 percent higher than those estimated in March 2012.”
This increase comes in addition to the $2,100 per family premium increase the CBO previously predicted back in 2009.

Thursday, July 12, 2012

Major Health Insurers Agree to Lower Rate Increases for Small Employers

Three of California’s major health insurers have agreed to lower their July rate increases. After review by the Department of Insurance, Anthem Blue Cross, Blue Shield, and Aetna agreed to modify their most recent small group rate increases for this quarter. Small group policies are available to small employers with two to 50 employees.
Anthem Blue Cross is withdrawing its 2.5% July 1st premium increase for small-group PPO products. The withdrawal will save about $25 million for 45,000 of Anthem Blue Cross’ small group policyholders, covering approximately 280,000 individuals. Anthem has raised rates 4.7% on its small group policyholders in the previous 12 months.
Blue Shield Life and Health Company will provide a credit to 58,000 small employers (covering approximately 265,000 individuals) equivalent to reducing its July 1st third quarter rate increase by 1.5%. As a result of the credit, the effective Blue Shield rate increase will be 1.6%, which is Blue Shield’s only small group rate increase for its small employer policyholders in the past 12 months. This modified rate increase will save policyholders approximately $15 million.
Aetna will lower its proposed small group rate from 2.6% down to 1.3% for its 9,200 policyholders (covering approximately 69,000 individuals), which saves about $8 million for small employers. Small employers have already been billed for July and August for the July 1st rate increases, but will see credits on their August or September bills.

Tuesday, July 10, 2012

One of the hidden pieces of Health Care Reform ACA


When does your home become part of your health care? After 2012!

Your vote counts big time in 2012, make sure you and all your friends and family know about this !

HOME SALES TAX

I thought you might find this interesting, -- maybe even SICKENING!

The National Association of Realtors is all over this and working to get it repealed, -- before it takes effect. But, I am very pleased we aren't the only ones who know about this ploy to steal billions from unsuspecting homeowners. How many realtors do you think will vote Democratic in 2012?

Did you know that if you sell your house after 2012 you will pay a 3.8% sales tax on it? That's $3,800 on a $100,000 home, etc. When did this happen? It's in the health care bill, -- and it goes into effect in 2013. Why 2013? Could it be so that it doesn't come to light until after the 2012 elections? So, this is ‘change you can believe in’?

Under the new health care bill all real estate transactions will be subject to a 3.8% sales tax.

If you sell a $400,000 home, there will be a $15,200 tax. This bill is set to screw the retiring generation, -- who often downsize their homes. Does this make your November, 2012 vote more important?

Oh, you weren't aware that this was in the ObamaCare bill? Guess what; you aren't alone! There are more than a few members of Congress that weren't
aware of it either.

You can check this out for yourself at:
http://www.gop.gov/blog/10/04/08/obamacare-flatlines-obamacare-taxes-home
I hope you forward this to every single person in your address book.

VOTERS NEED TO KNOW..




Tuesday, July 03, 2012

How Will Health Reform Affect Employers?

David Levine, CEO of the American Sustainable Business Council: Measures taking effect in 2014 will create more competition among insurance companies, which will drive down prices. When the ACA is fully implemented, small businesses will no longer pay more than large corporations for their insurance. However, one element in the Court’s opinion could hurt small businesses. The Court said that states need not expand Medicaid to 133% of the federal poverty level, as required under the ACA. Small businesses would benefit from the expansion since it would reduce the number of employees needing to be covered by a company’s healthcare plan. AHIP: Employers will have more incentive to self-insure their health coverage — increasingly shifting the burden of the fees to smaller employers and individuals who must shoulder the cost of a statutorily fixed level of fees no matter the relative size of fully insured coverage markets. Edward Fensholt, JD, and Mark Holloway, JD — leaders of Lockton’s Compliance Services group: Employers will need to begin making significant decisions in the next several months. Regulations will be very complex, particularly on the employer mandate. We can expect a crush of complex guidance compressed into a very short time. The next stops on the health reform train include distribution of four-page plan summaries, W-2 reporting of health plan values, limits on health flexible spending accounts, new income, and capital gains taxes on executives. The Supreme Court opinion also adds a wrinkle to the expansion of Medicaid eligibility. The Court said the feds cannot hold a state’s Medicaid funding hostage if the state doesn’t play. That could mean that more people will seek subsidized coverage in an insurance exchange or-worse-that some won’t qualify for Medicaid or exchange-based subsidies. Julio Portalatin, president and CEO of Mercer: Any employer that has not conducted a health care reform check-up should make it their first order of business. Employers need to redouble their compliance efforts, especially for immediate requirements, such as providing summaries of benefits and coverage to employees. This court’s decision reinforces popular features, such as providing coverage of dependents up to 26 and eliminating exclusions for preexisting conditions. David Rahill, President of Mercer’s Health and Benefits business:Employers can expect a spike in plan enrollment for 2014 as a result of the individual mandate. But they may see enrollment level off once the state exchanges become operational. By 2014, health insurance exchanges will be operating in every state, offering community-rated insurance to certain small employers and individuals, with federal premium tax credits available to help some people buy that coverage. In the near term, employers must report the value of employer coverage on IRS Form W-2, cap dollar limits on health care flexible spending arrangements, and increase Medicare withholding for high earners (those earning more than $200,000 per year). They must also comply with the reforms already in effect, such as coverage of dependents up to age 26.