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by Leila Morris
IN CALIFORNIA
• Private Health Exchange Survey in the Works
• Initiative Brings Specialty Care to Rural Markets
HEALTHCARE
• Employers Hit With More Cost Sharing For Expensive Drugs
• Study Reveals Medical Value of Eye Exams
• Exchange Customers Favor Narrow Networks
• Health Reform Update
• African American Health Alliance Promotes ACA
NEW PRODUCTS AND SERVICES
• Benefitfocus Is Now A Web-Based Entity
• ERISA Database
• Long-Term Care Rider
• Health Reform in Translation
• A Clear Explanation of LTC and Retirement Issues
• Tool Reduces 401(k) Risks
EVENTS
• Premium Financing Webinar
LONG-TERM CARE
• Agents Overlook LTC Tax Advantages
TRAVEL INSURANCE
• The Most Overlooked Benefits of Travel Insurance
IN CALIFORNIA
Private Health Exchange Survey in the Works
In the May issue, California Broker Magazine will feature the first annual private health exchange survey. Please email editor@calbrokermag.com if you want your company to be included.
Initiative Brings Specialty Care to Rural Markets
Blue Shield of California and Adventist Health launched a telehealth initiative to increase access to specialty care in rural areas. Blue Shield members can be diagnosed and treated by specialists from across the state through interactive video technology available at a local Adventist Health site. Blue Shield individual and family plan customers, can seek specialty care that’s not available in their areas through the telehealth network — including those who purchased coverage through Covered California. Specialties include cardiology, dermatology, endocrinology (diabetes), pulmonology, rheumatology (arthritis), orthopedics, infectious disease, nephrology, gastroenterology, general surgery and spine surgery. The specialists are Adventist Health physicians who are contracted in the Blue Shield network. Patients can be referred by their local primary physician or can self-refer, make an appointment through a centralized care coordination call center, and go to their local Adventist Health location for their office visit.The Adventist Health sites are in the following cities in Covered California regions one and two: Paradise, Clearlake, Ukiah, Willits, Fort Bragg, St. Helena, Napa, and Sonora. For more information, visit www.blueshieldca.com/telehealth.
HEALTHCARE
Employers Hit With More Cost Sharing for Expensive Drugs
Twenty-eight percent of employees now offer four-tier drug plans compared to only 12% that had these plans in 2012, according to a survey by United Benefit Advisors. With a four-tier plan design, employers can put the most expensive drugs in a category with significantly higher copays — thus passing along the costs to employees. The fourth tier pays for biotech or the highest cost drugs. Median pharmacy retail copays for fourth-tier drugs increased 25% from $80 in 2012 to $100 in 2013, and many are charging 10% to 30% of the cost of tier four drugs.
Carol Taylor, an employee benefit advisor with a UBA partner Firm said, “We are seeing more and more employers, small and large, raising copays substantially on fourth-tier drugs. With some of these drugs, the cost ranges from $1,200 to $20,000 per month (the cost of some cancer drugs). It is very costly for the plans, which in turn affects their premium rates. We’ve seen this for quite some time with self-funded plans, but we expect it will become more popular among small and large employers with group health insurance.”
The average tier-four median copay was $52 for small employers (less than 100 employees), from $45 to $60 for mid-size employers (100-499), and $80 to $100 for large employers (500+).
Larger groups are rated more independently, so they have a much bigger incentive to raise copays, especially for items that will cause rate increases. This might shift some as employers are forced to come into compliance with health care reform in 2015 since the prescription copays/deductibles, etc. must all track to the out-of-pocket maximum, said Rob Calise, UBA Board chairman noted that, he said.
Seventy-three percent of prescription plans had a copay and/or coinsurance after the major medical deductible compared to 68% in 2012. “It used to be that all drugs were applied to the deductible, then coinsurance on major medical. Now, quite a few carriers require deductible and then copays, particularly on high-deductible health plans. We’re also seeing small group and mid-market employers place generic brands before the deductible, but brand names after. The ultimate goal of shifting more cost to employees is to drive behavior to create better health care consumers. It is very possible we could see copays disappear completely, with everything falling under the major medical deductible,” he added. For more information, visit www.UBAbenefits.com.
Study Reveals Medical Value of Eye Exams
Eye care professionals can play a key role in identifying diseases and working with primary care physicians to deliver care, according to a study by UnitedHealthcare. The company looked at claims for plan participants with medical and vision benefits. Eye care professionals identified nearly 6% of the chronic conditions diagnosed among the study population. Also, eye care professionals identified 15% of certain diseases, such as multiple sclerosis and diabetes. They also found common conditions, such as high cholesterol and hypertension, rheumatoid arthritis, juvenile rheumatoid arthritis, Crohn’s disease, and Graves disease. Linda Chous, O.D., chief eye care officer, UnitedHealthcare Vision, said, “When eye care professionals share information about diseases with patients and other care providers, it can lead to better information, better decisions and better health outcomes.” For more information, visit www.Bridge2Health.com.
Exchange Customers Favor Narrow Networks
Fifty-four percent of those who are most likely to purchase an exchange plan (the uninsured and individuals) prefer less costly plans with narrow networks. Those who said they wanted a more expensive plan with a broader network were told that they could save up to 25% on health care costs with a narrow network plan. The share continuing to prefer the more expensive option dropped from 51% to 37% among the public, and from 35% to 22% among the uninsured and individuals. For more information, visit www.kff.org.
Health Reform Update
The following is a recent health reform update from Mark Hobraczk on behalf of Patient Services Inc.:
Conservative groups lose their second court battle seeking to block Affordable Care Act premium subsidies for consumers in federally facilitated Marketplaces while several Republican lawmakers seek probes into how three state-based Marketplaces continue to have little or no online enrollment capability.
The Centers for Medicare and Medicaid Services may have to scale back controversial new limits on Medicare Part D drug plans after Republicans and Democrats fret over having to explain them to constituents during an election year.
An Avalere Health study confirms that despite new out-of-pocket limits under the ACA, specialty tier coinsurance remains a barrier to access for Marketplace consumers relying on high-cost prescription drugs. Several state lawmakers propose even lower drug cost-sharing limits.
The novel Medicaid expansion alternative in Arkansas barely survives a repeal effort, while Mississippi, Pennsylvania, Utah, and Virginia struggle to find consensus on any expansion alternative. For more information, visit patientservicesinc.org.
African American Health Alliance Promotes ACA
On March 3, the African American Health Alliance released a public-service announcement to promote prevention and care benefits of the Affordable Care Act. The PSA highlights screening and preventions services and how to sign up by the March 31st deadline for the health insurance marketplaces. The effort responds also to the ongoing needs of the approximately 1.1 million people living with HIV, including the one in six who don’t know they are infected. “The…law that will go a long way toward furthering the elimination of racial and ethnic health disparities,” said Fredette West director of the Alliance. West participated in President Obama’s 2009 White House summit on Health Care and Health Reform. To view the video, visit
http://www.youtube.com/watch?v=ldCIb5DkCsg&feature=youtu.be
NEW PRODUCTS AND SERVICES
Benefitfocus Is Now A Web-Based Entity
BenefitStore is now a Web-Based Entity (WBE) with the Centers for Medicare & Medicaid Services. Benefitfocus offers a channel for employers to facilitate enrollment in Qualified Health Plans (QHPs) for employees who are eligible for an advanced premium tax credit For more information, visit www.benefitfocus.com
ERISA Database
The FreeERISA database has redesigned its plan dashboard and research tools. It now highlights the most important plan facts in a graphical and easily understood dashboard. It calculates critical plan figures and points out red flags. For more information, visit
http://www.SummitProfessionalNetworks.com.
Long-Term Care Rider
John Hancock launched an improved long-term care (LTC) rider on many of its life insurance products. The rider now provides greater design flexibility when insuring against rising costs of long-term care. It offers more coverage for retirement planning with an increasing death benefit option and more flexibility to specify the LTC coverage needed, helping balance LTC and estate planning needs. For more information, visit http://www.johnhancock.com.
Health Reform in Translation
The California Healthcare Foundation is offering a series of fact sheets and infographics demystify technical topics that are central to understanding the implementation of health reform in California. They explain the following:
* What is actuarial value?
* What is the premium tax credit?
* Individual coverage before and after ACA
* Small group coverage before and after ACA
* What is Modified Adjusted Gross Income?
For more information, visit http://www.chcf.org/publications/2013/08/health-reform-translation
A Clear Explanation of LTC and Retirement Issues
The American Academy of Actuaries launched its Essential Elements series of papers. The first two are “Long-Term Care Financing” and “Raising Social Security’s Retirement Age.” The series is designed to boil down complex content for a broader audience. For more information, visit www.actuary.org.
Tool Reduces 401(k) Risks
OTB Strategic Consulting launched an online 401(k) self-assessment tool for plan fiduciaries. It helps them find areas of non-compliance and provides solutions to correct them. For more information, visit http://www.thefiresystem.com/article-irs-vs-dol.
EVENTS
Premium Financing Webinar
Succession Capital Alliance is sponsoring a premium-financing webninar March 18, at 11:00 am PST. It will focus on how consumers can use intelligent leverage to purchase an indexed universal life policy that provides a future tax-free supplemental retirement income. Space is limited to the first 100 people who register. For more information, visit www.successioncapital.com.
LONG-TERM CARE
Agents Overlook LTC Tax Advantages
Many agents overlook the tax advantages of long-term care insurance premiums for their Baby Boomer clients, says Jesse Slome, director of the American Association for Long-term care Insurance (AALTCI).
An individual can deduct as much as $4,660 for long-term care insurance premiums paid in 2014. The maximum amount for 2013 is $4,550. People rarely qualify for the long-term care insurance tax deduction During their working years, but it typically gets easier after retirement, says Slome.
The IRS considers tax-qualified long-term care insurance premiums a medical expense. The yearly maximum amount depends on the insured’s attained age at the close of the taxable year. Someone older than 50 but younger than 60 can deduct up to $1,400 ($2,800 for a same-age couple), Slome notes. An individual age 70 or older can include up to $4,660 ($9,320 for a same-age couple). The amounts are indexed for inflation and increase each year.
After retirement owning long-term care insurance can help lower your tax bill. But, it’s best to get this coverage before retirement because the costs are lower and you are more likely to meet health qualification requirements. The future tax deduction is an extra benefit for your post-retirement years, he adds. For more information, visit www.aaltci.org/tax
TRAVEL INSURANCE
The Most Overlooked Benefits of Travel Insurance
One of the most overlooked travel insurance benefits is primary versus secondary coverage, explains Frank Trigo, general manager of InsureandGo. The vast majority of travel insurance policies offer secondary medical coverage, which is coverage in excess of all other valid and collectible insurance.
If you already have a private or group health plan, the travel insurance medical policy with secondary medical will only pay the expenses in excess or over the amount covered by the other primary health insurance policy that you have at home. “With primary coverage, you won’t have to jump through hoops to find out if your private or group health care plan will cover you when travelling internationally, you won’t have to incur out of pocket expenses and you won’t risk being denied medical care in a foreign country due to payment. Some cheaper policies may have higher medical coverage limits but if the coverage is secondary, that high limit might not be as valuable as a primary policy with a lower limit,” he adds.
Many policies cover your personal property regardless of where the loss occurs: be it in a cafe, on a tour, or from your hotel room. But many policies don’t cover electronics, such as tablets, phones, or computers so it’s important to check each policy carefully under the baggage and personal property section.
Since the cost of getting airlifted from a cruise ship or flown to a hospital in air ambulance for care is astronomical, travelers should look for policies that have a minimum of $100,000 in medical evacuation. “Also, the travel insurance company will make all the arrangements with the provider which is a tremendous benefit in itself,” says Trigo.
Transportation of beside support person in case you are hospitalized is another overlooked benefit. “Imagine you are hospitalized and alone in a foreign country. A good travel insurance policy will cover the costs to bring a person selected by you to your bedside if you are hospitalized for seven consecutive days,” he adds.
Trigo says that 24-hour emergency travel assistance is one of the most valuable, but under-marketed benefits of a travel insurance policy. The company can coordinate all aspects of your emergency, such as directing you to a proper medical facility, guarantying your admittance, coordinating care, monitoring your condition, and keeping loved ones back home apprised. For more information, visit http://www.insureandgousa.com.