Idaho Health Insurance

Well all in all, the talk about the rebates that people may get when broken down aren’t as spectacular as it first appears.

The highest rebates are estimated to be paid in the individual market, where the best guess is that 31% of insurance consumers nationally will be getting a yearly rebate of about $127 per person. In the small group market, about 28% of groups will be eligible for a rebate, with the average amount going to employers expected to be $21 per enrollee.

In the large group market, 17% of fully-insured large groups are sharing an estimate of $541 million in rebates.

That translates to an average of $14 per enrollee over a year’s time. Given that the average cost of employer-provided family health insurance is now about $13,000 per year, it’s doubtful that many people will find $14 to be a real savings.

Also, because many will receive a premium credit from the insurance carrier instead of a rebate check the impact will be minimal if not downright negligible.

The disruption of coverage’s, loss of agent services and higher premiums translate have tended to make a bigger impact than what we will see with the rebates.

“The nation’s big insurers are spending millions to carry out President Barack Obama’s health care overhaul even though there’s a chance the wide-reaching law won’t survive Supreme Court scrutiny.” Kirk Roy, vice president of national health reform with Blue Cross Blue Shield of Michigan, remarked, “Waiting is too big a business risk for any insurer.”

“Much of the money insurers are spending is paying for a close look at how to set premiums high enough to cover the expected increase in claims from people with pre-existing diseases, but not so high that healthy customers are scared off,” including “research into how many people with chronic conditions will need expensive prescriptions or how their customers will use health care.”

One area health insurance insurers are saving is to cut agents service fees (helping their clients) in half or to do away with insurance agents all together. The insurers are gearing up for most of their clients to get their health insurance on-line with a computer and everyone will have to rely on studying 6 pages per plan, per company, to decide which plan is best for them come January 1, 2014 (in the Exchanges).

If you have questions, there will be a Government 1-800 number to call for help. Some people called “Navigators” will be available somewhere to also answer questions for you concerning the plans available to you in your service area Exchange.

The concept of an unlicensed navigator replacing the role of a broker, or otherwise providing support to patients, has created fear among many health care experts, who are concerned about consumers receiving inaccurate advise about their health care coverage options.

You may still get your health insurance outside Exchanges and still get the personal service as you do today.

This way, you always have the same person to get to for questions, problems, claims issues, renewal information, plan shopping, name changes, dependent coverage changes and questions, employment status changes, group health plans vs individual plans.

The new Federal rules guidelines, Idaho State guidelines and each individual insurance company guidelines. Your insurance Agent or Broker will still be your “Hands-on” resource.

The Federal Exchanges at this point do not allow for Agents or Brokers… you are pretty much on your own to figure out all insurance issues unless you call the 1-800 number or track down a Navigator for questions regarding coverages you are looking to purchase.

On March 26, the Obama administration’s Affordable Care Act health care reform package goes to the U.S. Supreme Court, which has scheduled an historic three days of arguments. The outcome remains to be seen. 67% think the Supreme Court should either strike it down completely, or at least repeal the part that requires them to buy insurance or pay a penalty.

At the heart of the case is the constitutionality of the law’s “individual mandate requirement,” which requires virtually every American to purchase minimum health care coverage or else pay a tax penalty.

Mr. Holtz-Eakin, a former director of the Congressional Budget Office claims that the insurance mandate has almost nothing to do with remedying costs imposed on the system by those without coverage.

With the financial impact on future insurance costs several insurance companies have already begun raising price increases and are being scrutinized by state insurance departments.

Anthem Blue Cross California’s largest for-profit health insurer will raise rates 8.2% on average, down from its earlier request of 10.4%. The maximum rate hike will be 20% instead of 30%, according to the California Department of Insurance.

Trustmark Life Insurance Company and United Healthcare in Utah want to raise insurance rates.

WellPoint Inc., the nation’s second-largest health insurer with 34 million members, has said it will spend $100 million this year on technology upgrades to meet the law’s requirements. Aetna Inc., third-largest U.S. health insurer with more than 18 million members, says it expects to spend $50 million this year in part to upgrade software and computers.

States now have broad discretion in determining whether increases are fair or exorbitant. How Utah treats the Trustmark and United filings could signal how heartily regulators embrace their new enforcement role.

Last year, the Illinois-based insurer proposed rate hikes of 13 percent in five states that were deemed “unreasonable” by federal officials. The insurer was spending a low percentage of premium dollars on actual medical care and its projected costs were based on unreasonable assumptions, officials said.

Trustmark says bumping rates in Utah is “necessary to ensure the continued financial soundness” of the company, according to an explanation provided the state.

Regardless of the real impact this will have on health insurance in the United States, it is the Supreme Court that will have the final say and decide this.

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The 2010 health-reform law does little to directly address prices. It includes provisions forcing hospitals to publish their prices, which would bring more transparency to this issue, and it gives lawmakers more tools and more information they could use to address prices at some future date.

Two of the five most profitable industries in the United States – the pharmaceuticals industry and the medical device industry – sell health care. With margins of almost 20 percent, they beat out even the financial sector for sheer profitability.

Many researchers are skeptical that this is an effective way to fund medical innovation. “We pay twice as much for brand-name drugs as most other industrialized countries,” Anderson says. “But the drug companies spend only 12 percent of their revenues on innovation. So yes, some of that money goes to innovation, but only 12 percent of it.”

“The money we spend on health care is money we don’t spend educating our children, or investing in infrastructure, scientific research and defense spending. So if what this means is we ultimately have overmedicalized, poorly educated Americans competing with China, that’s not a very good investment.”

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One aspect of the national healthcare law passed in 2010 is the implementation of health insurance exchanges where individuals and small businesses can shop for, compare and purchase health insurance. These health exchanges must be in place by 2014.

The federal government encourages, and will contribute significant funding for, the implementation of state-based exchanges. Idaho must show that it has taken steps to put this process in place by January 1, 2013 to ensure it establishes and maintains the exchange. If we do not, the federal government will intervene and set up the Idaho exchange.

This would give the federal government unprecedented control over our state’s insurance market.

We feel strongly that the people most affected by an Idaho health insurance exchange should be in charge of creating and maintaining that exchange. States are already the primary regulators of the insurance market and have the infrastructure and highly trained staff to design, oversee and enforce these regulations. A federally-run exchange would splinter insurance functions between the state and federal government, adding complexity and cost to an already complex situation.

The time to act is now. While questions surround the implementation of exchanges and healthcare reform in general, we must take steps to develop a state-based exchange to ensure Idahoans are clearly represented when deciding what an Idaho exchange will look like. Delaying a decision would take control away from the people of Idaho and deliver more power to the federal government, potentially adding regulations that will impact you, your clients and the people of Idaho.

We encourage you to join a coalition of local business leaders, brokers, health insurance companies and healthcare providers in supporting the efforts of a state-based exchange. You can find out more information and join the coalition at www.keepitinidaho.com. Through this website you can also contact your local legislators, asking them to support passage of state exchange legislation.

We must let them know that control of an Idaho health insurance exchange belongs with the people of Idaho.

If you have any questions, please contact your local District Office.

For more information on Idaho’s Health Exchange please give us a call at (208) 377-7101

The State of Idaho definitely should set up a state exchange versus a federal exchange.  If a federal exchange is put into place in the state of Idaho, then Idaho has no authority on policies and procedures.  By asking for the extension, it will also give Idaho more time to make a determination on how to set up the exchange.  An exchange will be set up whether it will be by the State or Federal Government.  As you can see, several million dollars have already been spent by the Federal Government to set up the exchanges.

The Washington Post  (1/18/2012, Kliff) reports in its “Wonkblog” that “the Obama administration has spent $729 million laying the groundwork for health insurance exchanges,” and “that number will likely tip over $1 billion in the coming months, as states continue setting up the new marketplaces where Americans will shop for health insurance beginning in 2014.”

Idaho DHW Head Requests Insurance Exchange Waiver

The Idaho Reporter   (1/19/2012, Hurst) reports that Dick Armstrong, head of the Idaho Department of Health and Welfare (DHW), believes “the state may be running out of time to implement a state-based health insurance exchange.” He “penned a letter in early November asking Health and Human Services (HHS) Secretary Kathleen Sebelius to grant Idaho a waiver in the exchange implementation timeline,” as well as “to delay by a year the date by which the exchange must be fully implemented and functioning, now set for Jan 1, 2014.”

I am not sure how the country will be able to handle the cost of the healthcare reform with expected cost increases with Medicaid and simply the cost drivers for the reform.  Already millions of dollars have been spent in developing the technology for the health exchanges.

USA Today (1/12, Kennedy) reports on an Agency for Healthcare Research and Quality report, which found that “just 1% of Americans accounted for 22% of health care costs in 2009.” Meanwhile, “Five percent accounted for 50% of health care costs, about $36,000 each, the report said.” Lead author Steven Cohen noted that “the report’s findings can be used to predict which consumers are most likely to drive up health care costs and determine the best ways to save money.”

NYT: Healthcare Reform Law Has Had Little Impact On Total Spending.The New York Times (1/12, A26, Subscription Publication) editorializes, “So far, the health care reform law has had little impact on total spending even though some of its provisions, like prescription drug rebates for Medicare beneficiaries, have already kicked in,” and “the real impact will come in 2014 when there will be an expansion of Medicaid and a new federal subsidy program for low- and middle-income Americans.” The Times argues that “as the population ages, controlling spending will require reforms that coordinate delivery of services, reduce unnecessary care and spur innovations that improve quality and curb medical costs.”

Government Healthcare Spending Growing.The Washington Post (1/12, Kliff) reports in its “Wonkblog” that government spending on healthcare has not slowed. “A new analysis from the McKinsey Center for US Health System Reform shows that state and federal spending on health care has grown by 55 percent since 2003, nearly twice as fast as private spending growth.” The Post notes, “The overall health care spending slowdown actually masks two divergent trends – one, private health care spending accounts for an increasingly smaller chunk of the $2.6 trillion that the United States spends on health care, and two, government programs foot a larger part of the tab.”

CNN Money Article by Maureen Farrell

Record earnings for those Health Insurance Carriers providing Medicare Advantage plans. It doesn’t appear that these plans will be going away any time soon.

Read the CNN Money article: Medicare passes on big profits to insurers by Maureen Farrell.

Republican bill to raise Medicare premium for more affluent seniors GOP officials on Wednesday announced House Republicans plan to propose a gradual Medicare premium increase for the wealthy. Premiums would reach as much as $319.70 per month for seniors whose annual income exceeds $214,000. The measure, which has a Dec. 31 deadline for action, is an effort to provide cost coverage for renewing long-term unemployment benefits and Social Security payroll tax cuts. Yahoo!/The Associated Press (12/6)

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IDAHO INSURANCE AGENCY
Paul King and Charlotte Hildebrandt
1650 Albright Ln #101
Boise, Idaho 83709
208-377-7101