Article on Federal Health Insurance Program

Below is a great article from Bob LaMedola at the Sun Sentinel on the federal health insurance program for people with pre-existing conditions.  This program will no longer exist if everything goes through with the Health Care Reform in 2014 but until then this may be a good option if you have be denied health insurance in the private market.  Visit http://www.pcip.gov/ for information on the benefit plans.

"Feds lower health premiums for pre-existing condition policies

In Florida, 40 percent drop expected to attract uninsured to federal program

By Bob LaMendola, Sun Sentinel

12:46 p.m. EDT, June 3, 2011

A largely untapped federal health insurance program for uninsured people with pre-existing medical conditions will lower premiums by 40 percent in Florida starting July 1, officials said Tuesday.

The goal is to make the subsidized insurance more attractive to sick people who have been shut out of private coverage because insurers won't take them or the prices are too high, said Keith Maley, a spokesman for the U.S. Department of Health and Human Services, which runs the program.

The $5 billion program was created as part of the federal health overhaul last year. An estimated 750,000 in Florida and 7 million nationwide are eligible. Only 770 Floridians and about 18,000 in the nation have signed up, partly because the premiums were not affordable, officials and consumers said.

The government is lowering premiums to bring them closer to what healthy consumers pay for coverage in the open market, Maley said. Florida is one of six states where rates will come down as much as 40 percent. Also, they will need less paperwork to qualify – only a letter from a doctor rather than waiting for an insurer to deny them.

"We want to make sure the program is as accessible to people as possible," Maley said. In Florida, 27 percent of adults under 65 are uninsured, the second highest percentage in the nation, the census bureau says.

The program was designed to help people with illnesses such as cancer, heart disease and diabetes — even high blood pressure — who often are denied coverage or charged high rates by private insurers. It's open to those who have been uninsured for six months due to their illness.

Starting July 1, the program's rates in Florida will range from $118 to $158 a month for children, to $376 to $505 for adults over age 55. The program has three levels of coverage.

Last year, when the program began, the coverage would have cost more than $700 a month for Bruce Smith, 63, an unemployed Boca Raton resident with kidney, prostate and blood pressure problems. He did not enroll because he had private insurance costing $600 a month.

"At $390 a month, I believe people will be signing up," Smith said. "That would save me a lot of money."

The program is temporary, ending in 2014 when everyone will be able to buy policies through statewide exchanges, and insurers will be banned from charging higher rates for ill people.

For information, go to healthcare.gov or call 866-717-5826.

blamendola@tribune.com or 954-356-4526

Copyright © 2011, South Florida Sun-Sentinel"

Why are Health Insurance Costs Rising??

Milliman Medical Index shows why insurance costs are rising

The health care consulting firm Milliman Inc. reported that health care costs for families rose again in 2011. A family of four insured through an employer will average costs of $19,393 this year, up 7.3 percent ($1,319) from last year. Milliman also found:

• Health care expenses for families have more than doubled in the last nine years.
  
• Workers are being required to shoulder a greater percentage of those expenses. Payroll deductions for insurance increased by 9.3 percent this year, while employers' share of the cost fell 6 percent.
• Employers have increasingly been offering health plans with higher deductibles and co-payment limits.
  
• Employers are covering about 59 percent of employees' health care costs. Employees cover about 24 percent of the cost through their insurance payment and another 17 percent in out-of-pocket costs.

Milliman's annual Medical Index also explores the reasons for the cost increases. The study found:

• "For the third year in a row, outpatient facility costs have increased more than any other component; 90 percent of that growth is attributable to increases in unit costs, while (10 percent) is the result of increased utilization."
  
• "Hospital inpatient care experienced the next highest rate of growth."
  
• "Pharmacy costs rose 8 percent. About a quarter of the increase came from increased usage, while most of the change came from higher average prices."
  
• "Premium rate reviews do nothing to directly influence the underlying drivers of health care costs but can put pressure on insurers to find ways to keep medical costs down."
  
• "The effort to comply with the MLR requirements may result in a one-time decrease in premium trends but does not influence the health care cost trend."

Cover Florida is ENDING

Cover Florida is ending.  Read this great article from South Florida Business Journal below.  I can't help but think this is what is to come with the Health Care Reform...

Cover Florida health plan program getting scrapped

Premium content from South Florida Business Journal - by Brian Bandell

Former Gov. Charlie Crist’s signature plan to help uninsured Floridians buy health insurance has gone belly up as insurers have abandoned Cover Florida.

With Blue Cross and Blue Shield of Florida’s decision to stop enrolling new members in its Cover Florida plan, all six insurers that were selected by the state to offer the plans starting in 2009 have withdrawn. Florida Agency for Health Care Administration spokeswoman Shelisha Coleman said the state has taken down the Cover Florida website, as no insurers want to participate.

It only took two years for Cover Florida to collapse.

Michael W. Garner, president and CEO of the Florida Association of Health Plans, said Cover Florida failed to attract enough relatively healthy enrollees to counteract all of the sick enrollees. That created a “death spiral” of higher claims and escalating premiums, he said.

“It does show you to really think through these type of issues before you put new plans into play, or you will have pretty substantial negative consequences,” Garner said.

With the federal government seeking to introduce new health plans for the uninsured as part of the Patient Protection and Affordable Care Act (PPACA), the demise of Cover Florida shows that launching new plans can be perilous.

Crist signed Cover Florida into law in 2008. He promised it would provide an affordable option for uninsured residents. The plan allowed insurers to offer stripped-down benefits with annual coverage limits, but the individual plans were guaranteed issue, meaning they had to accept people regardless of health conditions.

Report said plan was unlikely to work

In July 2008, before the program had even started, the Center on Budget and Policy Priorities issued a report saying that Cover Florida was unlikely to work as a remedy for the uninsured problem because the benefits were too skimpy to attract most enrollees.

Crist touted Cover Florida last year during his unsuccessful U.S. Senate campaign. Yet, the program had only 6,385 enrollees as of Dec. 31, according to ACHA data.

As of the most recent U.S. Census Bureau count, Florida had 4.1 million uninsured residents in 2009 – representing 26.6 percent of the population under age 65.

John Herbkersman, BCBSF’s senior director of external communication, said the insurer discontinued Cover Florida enrollment because it was concerned about the long-term financial viability of the program. It will honor its existing contracts with enrollees through January 2013.

As part of PPACA, the federal government has created a health plan for people with pre-existing conditions that could provide individual coverage to people who can’t pass medical underwriting, he noted.

Another part of the federal law would set up health insurance exchanges so people could pool together and buy coverage, including with federal subsidies for those with low-incomes. It would be guaranteed issue.

The downfall of Cover Florida shows that health insurance exchanges will not work unless they attract enough healthy enrollees, FAHP’s Garner said.

“The people who went into it didn’t have employer-sponsored coverage and couldn’t qualify for individual insurance because of their health conditions,” he said. “Yet, the problem was that younger uninsured people weren’t enticed to join Cover Florida and buy that policy.”

Cover Florida had more chronically ill patients than expected, especially older women with health problems, he said. By the end, the premiums for Cover Florida were no longer a good value.

Garner noted that the federal plans for a health insurance exchange sought to avoid this problem by making health coverage mandatory. But, a lawsuit by the state of Florida seeks to stop the insurance mandate and throw out the health reform law.

“I don’t know how you make it work if you have guaranteed issue,” Garner said. “Outside of mandating coverage, they haven’t solved how to do it.”

---

Read more: Cover Florida health plan program getting scrapped | South Florida Business Journal

Health Care Reform: The Timeline for 2011 and 2012

Great article posted today on PrimePay's blog about Health Care Reform:

"One of the best and easiest to understand sources for outlining the health care reform changes and when they take effect comes from the HealthCare.gov website.  Their health care reform timeline is broken out by year and then also by the different types of benefits that the law provides to consumers. 

In this blog posting, we’ll focus on what will be changing in 2011 and 2012.  Tuesday’s article will focus on 2013 and 2014.  Below are some of the highlighted changes of the provisions of the Affordable Care Act, by year... along with the effective dates and links to download more information.

2011: HEALTH CARE REFORM

Improving Quality and Lowering Costs

• Offering Prescription Drug Discounts.  Seniors who reach the coverage gap will receive a 50 percent discount when buying Medicare Part D covered brand-name prescription drugs.  Download the brochure… Closing the Prescription Drug Coverage Gap.  Effective January 1, 2011.
• Providing Free Preventive Care for Seniors.  The law provides certain free preventive services, such as annual wellness visits and personalized prevention plans for seniors on Medicare.  Effective January 1, 2011.
• Improving Health Care Quality and Efficiency.  The law establishes a new Center for Medicare & Medicaid Innovation that will begin testing new ways of delivering care to patients.  Effective January 1, 2011.
• Improving Care for Seniors After They Leave the Hospital.  The Community Care Transitions Program will help high risk Medicare beneficiaries who are hospitalized avoid unnecessary readmissions by coordinating care and connecting patients to services in their communities.  Effective January 1, 2011.
• Introducing New Innovations to Bring Down Costs.  The Independent Payment Advisory Board will begin operations to develop and submit proposals to Congress and the President aimed at extending the life of the Medicare Trust Fund.  Administrative funding becomes available October 1, 2011.

Increasing Access to Affordable Care

• Increasing Access to Services at Home and in the Community.  The new Community First Choice Option allows states to offer home and community based services to disabled individuals through Medicaid rather than institutional care in nursing homes.  Effective beginning October 1, 2011.

Holding Insurance Companies Accountable

• Bringing Down Health Care Premiums.  To ensure premium dollars are spent primarily on health care, the new law generally requires that at least 85% of all premium dollars collected by insurance companies for large employer plans are spent on health care services and health care quality improvement.  Effective January 1, 2011.
• Addressing Overpayments to Big Insurance Companies and Strengthening Medicare Advantage.  The new law levels the playing field by gradually eliminating Medicare Advantage overpayments to insurance companies.  Effective January 1, 2011.  Download the brochure… Medicare and the New Health Care Law – What it Means for You.

2012: HEALTH CARE REFORM

Improving Quality and Lowering Costs

• Linking Payment to Quality Outcomes.  The law establishes a hospital Value-Based Purchasing program (VBP) in Traditional Medicare. This program offers financial incentives to hospitals to improve the quality of care.  Effective for payments for discharges occurring on or after October 1, 2012.
• Encouraging Integrated Health Systems.  The new law provides incentives for physicians to join together to form “Accountable Care Organizations.” These groups allow doctors to better coordinate patient care and improve the quality, help prevent disease and illness and reduce unnecessary hospital admissions.  Effective January 1, 2012.
• Reducing Paperwork and Administrative Costs.  Health care remains one of the few industries that relies on paper records.  The new law will institute a series of changes to standardize billing and requires health plans to begin adopting and implementing rules for the secure, confidential, electronic exchange of health information.  First regulation effective October 1, 2012.
• Understanding and Fighting Health Disparities. To help understand and reduce persistent health disparities, the law requires any ongoing or new Federal health program to collect and report racial, ethnic and language data.  The Secretary of Health and Human Services will use this data to help identify and reduce health disparities.  Effective March 2012.

Increasing Access to Affordable Care

• Providing New, Voluntary Options for Long-Term Care Insurance.  The law creates a voluntary long-term care insurance program – called CLASS (Community Living Assistance Services and Supports) – to provide cash benefits to adults who become disabled.  The Secretary shall designate a benefit plan no later than October 1, 2012.

Look for our next blog article on the health care reform timline for 2013 and 2014. "

 Posted by Nancy Mullin.

HMO vs. PPO

I have been getting a ton of questions lately about what is the difference between an HMO vs. PPO.  Well nowadays things are not as cut and dry as they use to be considering now there are HMO Open Access and POS.  But, lets talk strictly about HMO--Health Maintenance Organization--and PPO--Preferred Provider Organization.

HMO

•  A very tightly controlled network.
• Must have primary physician refer you to any specialist
• No out of network coverage
• Price is usually lower than a PPO

PPO

• Broad network
• Free to see specialists without a referral
• Out of network coverage to some extent
• Price is usually higher than an HMO due to more extensive network

Now I will say that if you want to save some money and don't mind a smaller network, a good compromise would be to go with a HMO Open Access Plan (HMO OA).  Most HMO OA Plans allow you to see specialists with out a referral and have a better network than a tradition HMO.  The only downside is that there is usually no out of network coverage.  Let's face it though your employees and you should always be utilizing the in network benefits because even if you have an out of network the benefits are going to be significantly reduced.

HealthCare Reform Breakdown CONT.

More from Mike Vogel's Florida Trend article:

"NEW REGULATIONS

Closed Counter
Before: Employees could use their health savings account, flex savings account or health reimbursement account money to pay for over-the-counter meds.

Now: If workers want to spend their money on over-the-counter purchases, they’ll need a doctor’s prescription.

Implication: Employees and doctors won’t bother with prescriptions for runny noses, so employees will ratchet down the money they park in accounts.

Class Distinctions
Before: Businesses could put their employees in different “classes” with different coverage for each class. A restaurant company, for instance, might put wait staff in one class and chefs, administrative staff and executives or owners in another.

Now: All are treated equally — or companies will pay significant penalties down the road if they “discriminate” in favor of highly paid employees. That raises concerns that some companies may drop coverage altogether rather than absorb the cost of adding dozens of employees, says Robert Pariseau, president of West Florida operations in Tampa for benefits company AGIS.

Exception: Companies can grandfather their existing plans — and avoid the penalties — provided they don’t make substantive changes to the plans such as increasing the share of the premium employees pay for coverage by more than 5%. That rule against major changes could force employers to give up grandfather status rather than absorb rising insurance costs. How many companies will seek or maintain grandfather status is unclear. The rules aren’t finished and the size of the penalties won’t be announced until the middle or later part of this year, giving companies a year to decide what to do. “Penalties could be huge,” Barber says. Some companies, if they can’t offer key talent a better plan or some healthcare perk, instead pay bonuses so high-value employees can obtain the coverage they want on their own. “They’re having to think outside the box to maintain their competitive advantage in recruiting talent,” Farmer says.

Care Standards
New: Small-business insurers must pay out 80 cents of every premium dollar for patient care. Insurers of larger employers have to pay out 85%.

Implication: Insurers will see margins pressured and so may cut back on broker commissioners, administrative costs or services to businesses and their employees. “I don’t see how the service gets better if they have to cut the administrative costs, maybe drastically,” Pariseau says. “It’s a low-margin business anyway.”

Tax Credit
New: A tax credit for small companies of up to 35% of their premium cost. “It’s a good deal. It’s better than a deduction,” Barber says. "

HealthCare Reform Breakdown CONT.

Continuation of Mike Vogel's article from FloridaTrend.com...

"NEW HEALTHCARE MANDATES

Kid CoverageBefore: No government mandate on how old an employee’s children can be before coverage expires.

Now: If a plan covers employees’ kids, coverage must be offered up to age 26.

Ounce of PreventionBefore: Employers and their insurers settled how much of preventive care — checkups and the like — was covered.

Now: Insurance has to cover 100% of certain preventive care.

Pre-ExistingBefore: People with pre-existing conditions could have treatment of that condition excluded from coverage under certain circumstances.

Now: No exclusions for pre-existing conditions up until age 19 and no exclusions over 19 starting in 2014.

Caps
Before: Companies could cap the maximum benefits they would pay. Typical plans capped employee coverage at $1 million to $5 million lifetime.

Now: Unlimited lifetime maximum for “essential” benefits.

The Bottom LineNew mandates raised rates 1.5% to 4% this year. “It’s obviously a factor,” says Steven Barber, an employee benefits lawyer and partner with Shutts & Bowen in Tampa, but “if nothing had happened, the costs would have gone up anyway.”

Indeed, the law-related increases came atop a 10% to 13% increase attributed to medical care cost rises. Employers responded with maneuvers such as raising deductibles and out-of-pocket maximums. That kept their cost increases to 6% to 9%. .."

Why Offer Employee Benefits

Here are the top 4 reasons to offer employee benefits:

1.  Attract New Employees: Employee benefits offer tax incentive to both the employer and employee.  Not to mention, the employee has access to better benefits for the price paid than they could with an individual policy.

2.  Maintain the Highly Qualified Employees:  As a company once you hire someone and they prove to be an asset to your company, you want to make sure they want to stay with you and not venture over to your competitors.  Employee benefits is a way to do this by offering great medical, dental, vision, life, 401k, etc.

3.  Improves Productivity:  Small firms are faced with difficult situations if even one of their employees has to go on sick leave.  When you offer health insurance, especially now that preventive care is covered at 100%, employees can stay on top of their health.  Through early detection, the employee can help to reduce the amount of sick leave they may need by hopefully stopping health problems prior to starting or by being able to start treating an illness before it becomes extremely serious.

4.  Tax Incentives:  By offering employee benefits, the employer can have substantial tax savings.  Also, if you meet the requirements for the Small Business Tax Credit you could be entitled to a percentage return of premium dollars spent.

If you want to explore offering EMPLOYEE BENEFITS or IMPROVING your current plans

call PrimeGroup Insurance Services (PGI) today:

561.578.6667

Health Insurance

Health Insurance is one of those words that more and more people are not excited to hear.  A good amount of businesses and individuals relate these words to expenses rising, benefits lowering, hours spent trying to make sure your doctor, pharmacy, and operations are covered, etc.  I, however, see the words "health insurance" and see opportunity--opportunity for businesses to encourage highly qualified individuals to join and stay with their company, opportunity for me to use my creative juices and knowledge to help clients lower/maintain their costs while providing excellent benefits, and opportunity for everyone to help to prevent serious health issues.

Health insurance is my life.  This blog was formed to help you understand health insurance but also to help you see the wonderful positive side in maintaining good health.  But I am sure you are now wondering who I am and where I came from.  I am a GATOR Alumni, I love cooking, just started my very own herb garden, I love going to the gym, spending time with my Yorkie, helping with the Palm Beach Gator Club, and I am a Health Insurance Consultant for PrimeGroup Insurance (PGI).

Each week I plan on keeping you current with local health insurance issues as they relate to the Health Reform, provide you with great tips on becoming and staying healthy, how to find a good insurance plan for you, and of course anything else related to your health.