Friday, October 24, 2014

L'Chaim - To Life!

Ebola. ISIS. Enterovirus. Scary stuff, and sure to get one considering one's own mortality. Not to mention the state of one's life insurance. Life Happens, "a nonprofit organization dedicated to helping Americans take personal financial responsibility through the ownership of life insurance and related products," has a new video out covering the basics.

If you already own this invaluable coverage, perhaps it's time to review it: is it enough? Are my premiums and beneficiaries up to date?

If you don't own a policy, have you considered whether you need one? What do your loved ones think about that?

Food for thought.

[Hat Tip: Bill Coffin]

Cavalcade of Risk #220: Call for submissions

Louise Norris hosts next week's edition. Entries are due by Monday (the 27th).

To submit your risk-related post, just click here to email it.

You'll need to provide:

■ Your post's url and title
■ Your blog's url and name
■ Your name and email
■ A (brief) summary of the post

PLEASE remember: ONLY posts that relate to risk (not personal finance tips and the like). And please only submit if you are willing to link back to the carnival if your submission is accepted.

Thursday, October 23, 2014

Apples To Oranges? Try Rotten Bananas

Fourth quarter GRANDMOTHERED small employer health insurance renewals have been rolling out. Many of them here in Ohio are in the 7%-15% range with few exceptions. These aren't easy for employers to swallow. Until I show them the ACA compliant alternatives.

Benefits are Apples to Oranges

Strict actuarial value guidelines are causing plans to be canceled. The plans replacing them must have a more cookie cutter benefit structure. There is little to no room for creativity or innovation from the insurance companies as they are bound by these new rules. The new benefits have different copays, deductibles, maximum out-of-pocket limits (MOOP), prescription drug coverage, and provider networks.

For most ESI plans the benefits are a reduction from what they were. Supporters won't tell us this. Instead they point to the fact that plans must now cover a few "new" benefits that impact a small portion of our population.

Rates, well...they are Rotten Bananas

Whoever believes that "rate shock" isn't going to occur hasn't spent a day in the trenches of health insurance. This is because ACA compliant plans must follow community rating guidelines. Regardless of health status everyone's rates must be the same (exceptions: age, tobacco use, location). If you have a vibrant healthy workforce congratulations. You are now subsidizing the unhealthy workforce.

Kudos to the companies who found savings through community rating. These folks all made the transition last year when they had an advantage. Note that we didn't hear very much cheerleading from this group because it was extremely small. How many small businesses do you know who went to ACA compliant plans and said "This is GREAT!!!"?

Fortunately here in Ohio the Legislature, Department of Insurance, and insurance companies took advantage of our weak-kneed President's "If you like your current plan" transitional relief gesture. For the short term my clients and other small businesses have the ability to renew their old plans for a couple more years. This is comparable to putting a Band-Aid on a jugular wound.

When the ACA option is looking at lesser benefits and a 50% or more increase it doesn't matter if my client likes their current plan or not, they are definitely keeping it.

Saving the MVNHS©

On Facebook, Doc Emer asks "What's wrong with the NHS?" and links to a story about the service's "own answer to whether it can survive as a unique system of healthcare."

I suggested that the more important question is whether (and why) the MVNHS© should be saved.

After almost 10 years of blogging on the Much Vaunted National Health Service©, it seems to me that the problems are endemic, and systemic. One of the biggest challenges is that, contra its supporters, the folks who run it have had no more success in reining in health care costs than any other system, the Liverpool Pathway notwithstanding.

The linked story begins propitiously enough: titled "How to save the NHS in just 50 pages," it sets forth a kind of Five Year Plan [ed: how ironic] the purpose of which is to "make the case for some of the changes we’re going to need.” And what are these changes?

That's a good question.

Unfortunately, the answer's a bit vague: "It’s not a one-size-fits-all blueprint for every part of the country, let alone a detailed plan for everything that needs to happen."

So, a typical government white paper, long on rhetoric and short on substance. No real surprise there. What I do find startling, though, is that the article explicitly sets forth the real problems facing the service:

"And as no political party wants the NHS to visibly decline on its watch, this is a not-so-subtle public warning that without extra billions, bad headlines and public discontent will follow."

Short version: "It sucks, we can't justify its continued existence,but I can't be the one to pull the trigger."

Which is pretty much where we'll be with a few more years of the ObamaTax under our belt.

Health Wonk Review: All the leaves are brown edition

Louise Norris hosts an outstanding edition of the Health Wonk Review. What's so outstanding about it, you ask? To begin with, it's a diverse group of posts, covering the ObamaTax to Ebola, virtual wards to healing prayer.

Kudos, Louise!

Wednesday, October 22, 2014

Can I Charge Interest?

One of my clients dropped their employer sponsored insurance plan effective May 1, 2014. This forced 21 of their employees (including the owners) to find individual coverage. We met and worked with all of them to secure coverage either off the exchange or through goodluck.gov.

In another month we will perform this exercise in patience once again. To really do a good job for our clients this process is frustrating, complex, and time consuming.

It's even more frustrating for me though when one of the insurance companies still hasn't paid my commissions yet.

For the last six months we have continued to help with service questions for the employees I enrolled with this particular insurer and have spend an inordinate amount of time trying to get paid. We knew there would be problems with this whole process and I understand that the initial issues could be a result of mistakes from all parties. However, those items were fixed a couple of months ago.

When will I get paid? Who knows. Its too bad I can't charge them interest though.

VaderCare? "Pray I don't alter it any further"

As the Halbig saga slogs on, the industry itself is moving forward:

"[I]nsurance companies offering plans on HealthCare.gov this year had a new clause inserted into their contracts ... that allows them to cancel plans if federal premium subsidies are eliminated."

Hunh.

Now why do you suppose that Ms Burntwell and her minions might agree to that?

It isn't very difficult to connect the dots.

Another Ebola Insurance update

Well, the more the merrier! This latest comes to us via email from Medical Mutual of Ohio:

"All fully insured and self-funded health plans administered by Medical Mutual Mutual and Mutual Health Services will cover treatment for Ebola as if it were any other illness, subject to terms and conditions of the member’s plan."

This is crucial language: it means that items like isolation and special travel arrangements are likely covered. On the other hand:

"[W]e do not have specific information about treatments considered “unproven,” experimental or investigational, such as plasma transfusions from recovered patients or the medication Zmapp."

They do go on to note, though, that they would "likely" be covered. I understand this: no one really knows what we're getting into here. And if this does in fact become pandemic, well, all bets are off.

Tuesday, October 21, 2014

Blue Cross Wrist Slap

Received this via email:

"The ruling confirms last year's judgment by a federal court in Detroit, which found that BCBSM collected millions of dollars in hidden fees over a nearly 20-year period from the  employee health plan for Hi-Lex Controls, Inc. and Hi-Lex America, Inc."

Over the years, we've blogged on the Blues' various legal travails more than once (most recently here). It's nice to see one that's actually "gone the distance," though.

The case at hand actually took 3 years to wend its way to SCOTUS, but it's apparently not the last:

"The Hi-Lex matter is the first of nearly fifty cases filed by Varnum [law firm] over the fraudulent fees."

It seems that BX was acting as the claims payor for self-insured plans, and reporting different amounts than were actually being charged. Even more egregiously, managers apparently knew of the practice, but discouraged employees from mentioning it, making them unwitting accomplices.

It appears that BX has since discontinued this practice, perhaps as a result of the litigation.

[Hat Tip: Tyler Lecceadone]

Monday, October 20, 2014

Have Faith (and Insurance)!

For the past 14 or so years, I've participated in a healing prayer group with some friends. We meet weekly and pray for the health of folks running the gamut from broken limbs to terminal illnesses. The one hard-and-fast rule we have is that the person for whom we're praying must know that we are praying for him (or her) and must have given us explicit permission to do so (there are exceptions, of course: someone in a coma is unlikely to meet those criteria for a while).

That rule is because we believe that the key to our efforts is that we are connected to and with the folks on the list. To that end, we also endeavor to get regular, timely updates from them on their progress (If any). We acknowledge that we don't know - can never "know" - whether or not our efforts have been successful, but we continue to meet week in and week out because we believe that we are making a difference in these people's lives.

Which may explain why my interest was immediately piqued by this item:

"I was parked in front of a patient’s home before my visit, running through my checklist. Patient’s diagnosis and prognosis. Any known family members or friends supporting the patient. Religious affiliation, if any. Patient’s name – you should always recheck the patient’s name. It’s good to know little about a patient’s medical concerns, but as chaplain, my concern is not what the patient’s illness is, but who the patient is. I want to address their spiritual needs and see how their spiritual health affects their overall health."

Turns out, the (anonymous) author works for an ACO (Accountable Care Organization - healthcare companies that are paid as a percentage of the money saved through their care management) called MissionPoint Health Partners. The folks in my healing prayer group were also intrigued,and urged me to connect with the firm to find out more.

So I reached out via their site's contact form, and even sent a LinkedIn invite to whom it appears is their media outreach person.

Days later: /crickets.

That's a shame, too, since this concept shows real promise, and there are some key questions that we'd like to see addressed.

For assistance: how do they deal with atheists who express an interest in this service?

And what metric do they employ to measure "success?" That is, they claim that this service reduces expenses, but how do they know this?

Oh, well, they missed an opportunity.

Sunday, October 19, 2014

About Those Obamacare Subsidy Calculations ..........

If you are among the millions waiting on 2015 plans and wondering about your premium
subsidy, worry no more. The folks at About have broken down the process into these simple steps.

The premium assistance tax credit is lower of the following two amounts:
  • The premiums for the second lowest cost silver plan minus an individual's required contribution for health insurance. A person's required contribution is household incomemultiplied by an applicable percentage.
  • The premiums for a qualified health plan for the individual, the individual's spouse and any dependents enrolled through a health insurance exchange.
The premium tax credit can be calculated using the following method:
  1. Calculate household income.
  1. Calculate household income as a percentage of the federal poverty line.
  1. Calculate the applicable percentage.
  1. Calculate the required contribution.
  1. Find the second lowest cost silver plan on the health insurance exchange.
  1. Subtract the required contribution from the second lowest cost silver plan.
  1. Then compare that number to the premiums for the health plan in which the person or family actually enrolled.
  1. Whichever number is lower is the amount of the premium assistance tax credit for the year.
But wait, there's more!
Information Needed to Estimate the Premium Assistance Tax Credit in Advance
  • Page 1 of Form 1040 (completed at least through line 37) for each person in the family
  • The premiums for the second lowest cost silver health insurance plan that covers the family
  • The premiums for the health insurance plan or plans you are thinking of or actually enrolled in
Information Needed to Calculate the Actual Amount of the Premium Assistance Tax Credit
  • Page 1 of Form 1040 (completed at least through line 37) for each person in the family
  • Form or Forms 1095-A received from the health insurance company
The premium assistance tax credit can be calculated using Form 8962.
Still not done ...........
You will also need to know how to calculate your household income, then calculate your household income as a percentage of the Federal Poverty Level, calculate the applicable percentage, calculate your required contribution, find the SECOND lowest cost Silver plan on the exchange, subtract your required contribution from the cost of the second lowest cost Silver plan then compare your maximum annual premium assistance to the actual premiums for the plan you chose. Whichever number is lower is your credit.
Got that?
Good.
But before you start all this you will need:
To estimate the premium assistance tax credit for 2014:
  • Use your 2013 tax return to calculate your modified adjusted gross income and household income.
  • Revise your household income based on any changes in income you expect for 2014.
  • Use the 2014 poverty guideline chart to calculate your expected household income as a percentage of the federal poverty line.
  • Use the 2014 applicable percentages chart.
  • Use applicable percentage and household income to calculate the required contribution.
  • Use the second lowest cost silver plan for the area in which you live to calculate the premium assistance amounts.
  • Consider using Form 8962 as a worksheet to do your calculations, so you can become familiar with this form.
To calculate the actual amount of the premium assistance tax credit for 2014:
  • Use your 2014 tax return to calculate your modified adjusted gross income and household income.
  • Use the 2014 poverty guideline chart to calculate your expected household income as a percentage of the federal poverty line.
  • Use the 2014 applicable percentages chart.
  • Use applicable percentage and household income to calculate the required contribution.
  • The second lowest cost silver plan is shown on Form 1095-A line 33B.
  • Use Form 8962 to do your calculations. This form is then included with your tax return for the year.
To estimate the premium assistance tax credit for 2015:
  • Use your 2014 tax return to calculate your modified adjusted gross income and household income.
  • Revise your household income based on any changes in income you expect for 2015.
  • Use the 2015 poverty guideline chart to calculate your expected household income as a percentage of the federal poverty line.
  • Use the 2015 applicable percentages chart.
  • Use applicable percentage and household income to calculate the required contribution.
  • Use the second lowest cost silver plan for the area in which you live to calculate the premium assistance amounts.
  • Consider using Form 8962 as a worksheet to do your calculations, so you can become familiar with this form.
  • Compare your calculations to the calculation provided by the insurance exchange.
No big deal, right? 

Here is that link again in case you missed something.

Be sure to thank your Congress critter when you go to the polls.

Obama is not on the ballot this year, but his policies are.

Double Whammy, ObamaTax-style

First the bad news:

"ObamaCare shoppers in search of the lowest-cost plan may come down with a mild case of rate shock when 2015 exchange enrollment begins next month ... the cost of the cheapest bronze plan will jump an average of 13.9%"

Remember when we were promised that we'd have 3000% rates decreases?

Good times, good times.

But wait, it gets better worse:

Turns out, the folks who actually buy these plans can't afford to use them:

"[E]ven among those who receive enough subsidy money from the rest of us to offset the high premiums, killer deductibles make their coverage much more expensive in practice, to the point of rendering them virtually useless."

It's simple mathematics, after all: thousands (perhaps tens of thousands) of dollars in premium plus thousands ((perhaps tens of thousands) in out-of-pocket costs means that a lot of folks now can't afford to use the insurance they scrimped and saved to buy.

But hey: so much better than the old system, no?

Saturday, October 18, 2014

Cancer Walk Thank You [Updated!]

So, the Making Strides Against Cancer walk took place this morning, and I'm happy to report that we all made it through the grueling 3.1 mile course. Thankfully, the rain held off until we'd finished (Yay!); some 10,000 people took part in ours.

Our team finished a very respectable 21st out of 539 (top 4% - WooHoo!), and my terrific contributors donated $800 as of this morning. But don't feel left out: you can still donate here.

Thank You!

I'll post our team picture shortly.