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by Leila Morris
IN CALIFORNIA
• Covered California Announces Health Insurance Plans for Small Businesses
• Agents Lose An Ally in Covered California
• Public Officials Criticize Kaiser For Rate Hikes
• HealthCompare Signs Web Broker Entity Agreement
• CAHU Says That Agents Need to Fight SB 639
• Agents Lose An Ally in Covered California
• Public Officials Criticize Kaiser For Rate Hikes
• HealthCompare Signs Web Broker Entity Agreement
• CAHU Says That Agents Need to Fight SB 639
• MediExcel Health Plan Offers 24/7 Doctors Office Hours
EMPLOYEE BENEFITS
• Employees Need Financial Wellness
HEALTHCARE
• GOP Attempts to Defund Obamacare
• Nearly 1 Million Americans Could Leave Their Jobs Because of Health Care Reform
• Website Educates Business Owners About the Affordable Care Act
LTC & DISABILITY
• Long-Term Care Costs Continue to Climb Across All Provider Options
• Strategies for Using FMLA to Manage Disability Costs
NEW PRODUCTS
• Private Exchange Blueprint for Brokers
• Disease Management Metrics
• Complimentary Health Care Reform Reports
• Assessment Tool for Employee Benefits
IN CALIFORNIA
Covered California Announces Health Insurance Plans for Small Businesses
Peter Lee, Executive Director–Covered California
Covered California, the state’s new health benefit exchange, announced the insurance carriers and rates for its small-group market, the Small Business Health Options Program (SHOP). In October, California businesses with 50 employees or fewer can choose from health insurance plans similar to those that are usually only available to larger employers. In 2015, the SHOP is expected to offer plans to businesses with 100 or fewer workers.
The mix of HMOs and PPOs will be sold through licensed agents who are trained and certified by Covered California. Licensed agents will soon be able to pre-register for Covered California certification by visiting www.healthexchange.ca.gov. In addition, in the coming months, Covered California will host a series of events to familiarize agents with Covered California products and the certification process.
Covered California’s executive director Peter Lee said that employers will have a choice of more plans, strong provider networks, online tools for year-round shopping and enrollment, and streamlined invoicing. The SHOP will also make health care coverage more affordable by offering tax credits for small businesses that qualify. Small businesses are eligible for a federal health care tax credit if they have fewer than 25 full-time-equivalent employees for the tax year, pay employees an average of less than $50,000 per year, and contribute at least 50% of their employees’ premium cost. Employers with 10 or fewer full-time-equivalent employees with wages averaging $25,000 or less per year are eligible for the maximum amount of tax credits. To be eligible for the federal tax credits, small businesses must purchase coverage through Covered California’s SHOP.
There is no penalty for small business owners who choose not to participate in the program. While rates vary by region, Covered California SHOP premiums are generally comparable to 2013 small-group market rates and, in some cases, can save small businesses money on their premiums.
Covered California has selected the following health plans to participate in SHOP:
• Blue Shield of California
• Chinese Community Health Plan
• Health Net
• Kaiser Permanente
• Sharp Health Plan
• Western Health Advantage
Small businesses are not required to enroll in Covered California’s SHOP, and there is no penalty for not participating or not providing health insurance to their employees. However, Covered California SHOP health plans will offer expanded choices, online tools for convenient shopping and enrollment, and streamlined invoicing.
Federal tax credits are available to some businesses with fewer than 25 full-time-equivalent employees to offer coverage to their workers. Small-business owners can enroll in the SHOP plans when the health exchange opens Octpber 1. Like the insurance plans in Covered California’s individual market, the SHOP plans were negotiated to bring a standardized set of benefits, a robust provider network, broad choice for employers and their employees, and competitive prices to the Covered California portfolio.
Lee said, “Employer-sponsored health coverage has historically played an important role in insuring Californians, and our launch of a full-choice small-group market is a testament to the state’s commitment to build on the critical role of employer-based coverage. California is offering plans that will encourage thousands of employers to participate, ultimately increasing the number of insured Californians, which is the mission of the landmark federal law. For years, small businesses have been effectively shut out of the health insurance marketplace. High administrative burdens, lack of choice for employees, the challenge of comparing plans and costs – all these have meant that the overwhelming majority of California’s small businesses – roughly 86% – do not offer health insurance to their workers, even though many want to and understand the clear benefit of a healthy workforce. But change is on the way and the opportunity for small businesses to offer their employees quality coverage at a more reasonable cost will soon be real for small businesses throughout California.” For detailed information, visit http://www.coveredca.com/news/PDFs/Covered-California-SHOP-booklet.pdf.
Agents Lose an Ally in Covered California
Michael Lujan, director of Sales and Marketing for Covered California’s SHOP has resigned. Lujan, who was a health agent for many years, advocated for the important role that agents play in the healthcare system. Upon announcing is resignation, Lujan stated, “I am proud to have played a small role in the development of our state exchange and grateful for the opportunity to apply my industry experience to my role at Covered California. We have a very bright and talented staff. I was new to state government and through this experience, gained a broader and deeper understanding of health care reform and privileged to share this insight and information to help prepare small employers, insurance agents and community groups for the changes coming in 2014. I can leave with confidence knowing that our SHOP staff, sales team and agents are prepared for success and ready to get California enrolled. I will continue to support the mission and values of the marketplace in a new capacity and celebrating the successful launch in October.”
Public Officials Criticize Kaiser for Rate Hikes
Kaiser is drawing complaints from employers who say the company’s policies are no longer the bargain for quality care that they once were. The Los Angeles Times says (http://lat.ms/13FtqWK ) Kaiser Permanente rejects the criticism, reporting it’s still a great bargain with prices that are often 10% below its rivals.
Officials managing retired state employees and public employees in Los Angeles and San Francisco have criticized ever-rising premiums. Officials at CalPERS – which is the nation’s third-largest health care buyer – say Kaiser’s premiums have gone up 65% since 2007. Other HMO premiums have gone up, too, but not as much.
HealthCompare Signs Web Broker Entity Agreement
HealthCompare, a division of The Word & Brown Companies, took an important step this week in helping preserve and advance the role of independent insurance brokers and agents by signing the Centers for Medicare & Medicaid Services (CMS) Federally Facilitated Exchanges Web Broker Entity (FFE WBE) Agreement on behalf of Health Compare Insurance Services.
The Federally Facilitated Exchanges, also known as “Federally Facilitated Marketplaces,” will operate in states that have chosen not to build their own individual health insurance marketplaces, which are being developed nationwide as part of the Affordable Care Act (ACA).
The FFE agreement will provide HealthCompare access to the Federal data hub; this hub allows HealthCompare to provide a determination of tax subsidy and eligibility qualification information to consumers. This agreement, once approved by CMS, will only enhance HealthCompare’s already robust online tool that helps individual and families easily research, compare, buy and enroll in health insurance through its free, accurate and customized health insurance quotes from the nation’s leading carriers.
“The new agreement will allow HealthCompare to continue to provide the most robust and diverse selection of health insurance options for Americans, including those eligible for ACA subsidies,” says Kyal Moody, Senior Vice President at HealthCompare. “We’re excited to be a partner with CMS for the new marketplaces and look forward to working with individuals and families to identify and enroll them in coverage that satisfies the ACA individual mandate and addresses their specific coverage needs.” In addition, Quotit, another division of The Word & Brown Companies, will be signing a separate CMS agreement to empower independent agents and brokers to participate in the Federally Facilitated Exchange in assisting consumers across the country to find affordable health insurance.
CAHU Says That Agents Need to Fight SB 639
The California Assn. of Health Underwriters (CAHU) is warning agents that S.B, 639 continues to move forward in the Legislature. SB 639 (Hernandez) makes it illegal to sell any individual plan that does not mirror what is offered within Covered California. SB 639 also sets government mandated limits on plan deductibles that are not actuarially sound. The bill will be heard next in the Assembly Health Committee on August 13. CAHU says, “Now is the time to contact your Assemblymember to voice your opposition. We will continue to need your help in fighting this bill.”
CAHU says that these limits should not be placed in statute since there is no federal mandate to set deductible limits in state law. As the Exchange moves forward in 2014 and beyond, these deductibles may need to be updated to ensure the deductible limits are actuarially sound. Not setting these in statute will permit easy updating as federal guidelines change and make it meet actuarial standards. Standardization, as proposed by the bill, eliminates choice and competition for California’s health care consumers, says CAHU. You can click this link to get a pre-written letter to send out: https://www.votervoice.net/CAHU/Campaigns/31906/Respond
MediExcel Health Plan Offers 24/7 Doctors Office Hours
Starting September 1, members of MediExcel Health Plan will have access to routine doctor office visits on a 24 hour a day, seven day a week basis. MediExcel Health Plan is a Mexican-based company licensed by California Regulators to offer group healthcare coverage to U.S. employers in San Diego and Imperial Counties with healthcare benefit delivery in Mexico, specifically Baja California. For more information, visit www.MediExcelHP.com
EMPLOYEE BENEFITS
Employees Need Financial Wellness
Forty-four percent of full-time workers spend time worrying about personal finances during work hours. In addition, 29% actually deal with their personal finances at work, and of those, 46% spend an average of two to three hours a week at work dealing with these issues, according to a report by Purchasing Power. Forty-four percent of those who work full-time or have a spouse who works full-time say they are better off financially than they were one year ago. Yet, 28% have trouble meeting monthly household expenses and 44% don’t have at least $2,000 in emergency savings.
Employers are offering on-site money management and financial planning seminars to help employees change their behaviors and increase their financial literacy. One offering is a program that allows employees to purchase household items and educational services through payroll deduction. The goal is to prevent over-spending and promote disciplined purchasing through manageable payments and pre-set spending limits and controls. For more information, visit www.PurchasingPower.com.
HEALTHCARE
GOP Attempts to Defund Obamacare
According to Media Matters, Fox News offered Sen. Ted Cruz (R-TX) a platform to promote his petition to defund President Obama’s health care law, an effort that has been repeatedly pushed by Fox News host Sean Hannity.
On the July 29 edition of Fox News’ America Live, guest host Shannon Bream hosted Cruz to promote his petition to defund the Affordable Care Act (ACA). During the interview, Bream praised Cruz’s background, reporting, “The first time I met you was when you argued a case at the Supreme Court. You seem very familiar with the Constitution.” Cruz appealed to Fox viewers, declaring that “the only way” to stop funding of health care reform is if Americans “go to dontfundit.com, we sign a national petition, and every one of us picks up the phone, calls our elected officials and says, ‘Talk is cheap. Stand up, use the constitutional power of the purse and defund Obamacare now.’ If we stand together, we can win this fight.”
Fox News host Sean Hannity has repeatedly threatened Republicans to support defunding, even to the point of threatening primary challenges to those who don’t comply. After Sen. Mike Lee (R-UT) threatened to shut down the government if the health care law was not defunded, Hannity hosted Lee on his show, reporting, “This is an interesting moment — I think — and a test for the Republican Party. Are they going to be the conservative alternative? How many members of the House and Senate ran on repealing Obamacare? Now they can vote symbolically or they can take this stand, is what you’re telling them to do. I’m supporting you. I think they ought to just put their foot down, stand on principal and stop calculating what political impact is going to be felt here. Fund the rest of the government, but just defund Obamacare. And then if the Democrats want to shut down the government, then let them shut it down.”
Nearly 1 Million Americans Could Leave Their Jobs Because of Health Care Reform
Up to 900,000 Americans could decide to stop working because of the Affordable Care Act, according to research from the University of Chicago Booth School of Business. The study is based on the abrupt end of Tennessee’s Medicaid expansion in 2005. That year, Tennessee dropped 170,000 of its citizens from Medicaid, which was the largest Medicaid disenrollment in the history of the program.
In 1994, Tennessee’s expanded its Medicaid public health insurance program to provide for uninsured and uninsurable adults regardless of age, income or family status, becoming one of the most generous in the country. But the program was ended nine years later, largely due to budgetary constraints. Approximately 170,000 residents lost coverage.
Those who lost coverage were disproportionately single, childless adults with incomes slightly higher than the federal poverty line. That population is very similar to uninsured Americans who are likely to gain coverage under the Affordable Care Act.
Close to half of those who lost TennCare coverage in 2005 found insurance through an employer. As soon as TennCare coverage ended, there was a spike in Google searches for “job openings” in Tennessee.
“This shows that there are many people out there who look for work simply because they need health insurance. For them, the perk matters more than the paycheck,” says Tal Gross, co-author of the paper and assistant professor of Health Policy and Management at the Mailman School.
“The fact that people are working solely to get health insurance signals a failure of the private health insurance market,” explains Matthew J. Notowidigdo, Neubauer Family Assistant Professor of Economics at the University of Chicago Booth School of Business and a study co-author. “That’s one of the reasons why the Affordable Care Act was created.”
With Medicaid rapidly expanding under the Affordable Care Act, the researchers foresee that such a progression could happen in reverse: The option of public health insurance may lead some Americans to retire or to leave their jobs. This doesn’t make the Affordable Care Act a “job killer,” as some have suggested; it just provides an alternative way to procure health insurance that doesn’t require people to work for the “perk.”
“When the Affordable Care Act is enacted, hundreds of thousands of people may choose to leave the labor force or retire earlier…because they now have access to health insurance outside of their jobs,” explains Craig Garthwaite, assistant professor at Northwestern University’s Kellogg School of Management and a study co-author. “It’s giving people important options that otherwise wouldn’t exist without the ACA. Historically, health insurance in the United States has been tightly linked to employment, and the ACA weakens that link.” For more information, contact Ethan Grove at 773-834-5161 or ethan.grove@ChicagoBooth.edu.
Website Educates Business Owners About the Affordable Care Act
The Obama Administration launched a health reform website for employers, USA.gov/healthcare. The site includes a wizard tool that is tailored based on size and location of a business, so employers can learn how the law helps them provide affordable coverage options to their employees while still meeting their bottom line. The site will act as a user-friendly hub that connects employers to information from the Small Business Administration, HHS, and the Treasury Department on tax credits and other provisions of the law.
LTC & DISABILITY
Long-Term Care Costs Continue to Climb Across All Provider Options
A survey sponsored by John Hancock reveals rising LTC costs:
• The 2013 average cost of a private nursing home room ($258 a day/ $94,170 annually) has risen an average 3.6 % per year
• The 2013 average cost of a semi-private nursing home room ($227 a day/ $82,855 annually) has risen an average 3.6 % per year
• The 2013 average cost for a month in an assisted living facility ($3,427 a month/ $41,124 annually) has risen an average 2.0 % per year
• The 2013 average cost of adult day care ($71 a day/$18,460 annually) has risen an average of 1.6 % per year.
• The 2013 average cost for a home health aide ($19 hourly/$29,640 annually) has risen an average 1.3 % per year.
John Hancock has also updated its interactive Cost of Care Map and Calculator to reflect the latest findings from its 2013 study. To view the Cost of Care map and calculator, visit http://www.johnhancockltc.com/coc. A free iPad app will be available for download from iTunes at the end of August.
Strategies for Using FMLA to Manage Disability Costs
Rather than viewing the FMLA as strictly a legal compliance requirement, employers should see it as an early warning system for costly health issues among their employees and their families, according to Thomas Parry, PhD, president of the Integrated Benefits Institute (IBI). He noted that a worker’s request for FMLA leave may be a precursor to more costly leaves.
A study by IBI reveals that employees who used the FMLA for personal health conditions were twice as likely to use short-term disability the following year. Employees who took FMLA leave for a family member’s health condition were about 50% more likely to have a short-term disability claim the following year.
To avoid more-costly disability claims, employers should engage employees as soon as they find out about a potential issue. This should be done regardless of an employee’s eligibility for FMLA leave. Yet, so few employers do this early intervention.
The experts recommend the following strategies to manage FMLA costs:
• Connect employees with resources: Employers should connect employees with resources, such as employee assistance programs, ergonomic interventions, and disease management programs.
• Explore work continuity options: Discussions about job accommodation and stay-at-work options should begin at the earliest opportunity.
• Expand training for supervisors: Employers and their benefit partners should expand FMLA training for supervisors on early warning signs and potential interventions. They should also conduct periodic roundtables with supervisors and human resources staff to review ongoing cases and provide appropriate coaching and support for supervisors.
• Stay in touch with workers: Supervisors should stay in contact with employees during FMLA and short-term disability leaves to keep them engaged and connected to work.
• Better educate employees about FMLA: Training for employees about their FMLA rights and responsibilities should be improved and it should be consistent. Employees generally receive information about FMLA from their human resource departments, but typically only at the time of requests. This increases the workload of personnel who must verify requests with no chance of approval. Workers should also be educated on the types of leaves FMLA does and does not cover.
• Synchronize HR duties related to leaves: Employers should coordinate FMLA-related activities of human resources, benefits and occupational health departments so cases can more actively be monitored and managed.
For more information, visit www.ibiweb.org.
NEW PRODUCTS
Private Exchange Blueprint for Brokers
Health PartnersAmerica updated its Private Exchange Broker Blueprint. It’s designed to help insurance professionals understand Obamacare and help individuals and employers get the best defined-contribution plans and private exchanges. For more information, visit www.healthpartnersamerica.com.
Disease Management Metrics
The Patient Protection and Affordable Care Act (ACA) underscores the value of disease management to reduce healthcare spending. To illustrate the contributions of disease management across the care continuum, the Healthcare Intelligence Network has compiled 38 Disease Management Metrics: Population Health Benchmarks to Drive Accountable Care. For more information, visit:
http://store.hin.com/product.asp?itemid=4393
Complimentary Health Care Reform Reports
BenefitMall is offering complimentary health care reform reports to its payroll clients. These enhanced reports are designed to help employers with the Employer Shared Responsibility provision of the Affordable Care Act. Payroll clients can determine whether they will be subject to the Employer Shared Responsibility Mandate, whether they will be eligible for a small business tax credit, and whether they should report employee medical benefits on W2s. The new payroll reporting capability will track a payroll client’s full-time equivalent employees throughout the year. For more information, visit www.benefitmall.com.
Employee Benefit Assessment Tool
The new Guardian Benefits Value Tool walks employers through the benefits they offer, the affordability of these benefits, and the level of administrative and communication support that’s required to manage the benefits. The tool then calculates an index score, which helps employers identify the most important factors in selecting an employee benefit package and benchmark their results against similar companies. The goals is to help employers understand the underlying drivers of their benefit offerings and provide information on the best administrative options — whether it is a traditional model or a private or public exchange. For more information, visit www.GuardianLife.com.