On keeping your plan if you like it

By now, posts on "grandfathered" and "grandmothered" plans must seem like old news. And yet, the hits keep on comin'. In email from Medical Mutual of Ohio:

"“T" Plans Now Available on MyBrokerLink/Converting Grandfathered "S" Plans to New Grandfathered "T" Plans"

Clear as mud, no?

This is what happens when the government takes over the health insurance industry (and make no mistake, if you exercise control over a market segment, you own that segment). And so we get authentic frontier gibberish like the above.

Oh, what does it mean?

Basically, the Feds have graciously (and illegally) allowed insurers to make modest changes to grandfathered/grandmothered plans, which MMO will be implementing as they renew. This particular email targets small group plans. The change is ostensibly an effort to help hold down premiums; let's just say that I'm not holding my breath.

Covering Baltimore

As was the case in Ferguson last year, the riots in Baltimore over the past few days have caused widespread property damage, mostly to folks who had nothing to do with the proximate cause of them:

Homes, businesses and cars have been burned, looted and otherwise damaged, leaving owners wondering what, if any, insurance payments they can expect.

The Insurance Information Institute (III) has helpfully published a media advisory confirming that, generally speaking, such damage is considered a covered event, and claims will likely be honored:

"Auto, homeowners, and business insurance policies generally include coverage for property losses caused by riots and civil commotions, such as those occurring this week in Baltimore ... Standard business property insurance policies provide coverage for the structure of the building as well as the contents inside"

And for folks with Business Interruption coverage, "insurance reimburses losses when a covered peril forces a business to temporarily close its doors ... [and pays] employees and vendors, not to mention the rent and electric bills."

Whew!

As always, be sure to check with your own carrier to confirm whether or not these exposures are, in fact, covered.

Employer Sponsored Insurance: Behind the Little Tree is Obamacare's Forest

Obamacare was passed with a promise to reduce premiums, elevate the level of care we receive, and put an end to rising health care costs. It was also promised that everyone would have access to good insurance and that if we liked our plans we could keep them. These promises have gone empty, yet in the eye of public perception, the favorability/unfavorability of the law (according to the Kaiser Family Foundation Poll) is tracking close to even. However, the most important question that is asked, but not discussed, is what will lead to changes in views in the next few years.

For now, the favorable perception can be attributed to the fact that Obamacare is front loaded with warm and fuzzy feel good benefits. From "free" benefits like birth control and preventive visits, to the slacker rule - keeping your "kid" on insurance to age 26 - every provision of the law that has been implemented has a positive result.

On-the-other-hand, things that have a negative impact have been repealed, cancelled, delayed, or extended. We have had a repeal of the 1099's and CLASS Act, an offer to extend "transitional" policies (the lie that if you like your plan you can keep it), and numerous delays in employer reporting including a year long delay in the employer mandate. We also haven't felt the impact of "indexing" which will increase what people have to pay for premiums while reducing benefits.

In keeping with the "kick the can down the road" theme, two new pieces of legislation are gaining momentum. One is to repeal the Health Insurance Tax and the other - introduced today - is to eliminate the Cadillac Tax.

These taxes, reduced benefits, higher costs, and administrative burdens will increase over the next few years. Moreover, they will reach the employer sponsored markets impacting a much larger share of our population (roughly 55% of our population are covered by their employer). 

Which takes us to the most important question asked when discussing public views on Obamacare:

"Would you say the health care law has directly helped you and your family, directly hurt you and your family, or has it not had a direct impact?"

It's not who has been helped (19%) or hurt (22%) by the law. It's the significant majority of respondents - 56%!!! - who have felt no direct impact.

It's not a coincidence that the respondent percentage is almost identical to those with employer insurance. It shows that until Obamacare is fully implemented and a majority feels an impact, public opinion will see little change.

But until then, we will still be focused on the trees and completely be overlooking the forest.

Monday Afternoon Link Potpourri

Some interesting items for your consideration:

■ "Nearly a fifth of the National Football League settlement approved this week compensating former players with head injuries could go to their health insurers instead"

Briefly, the NFL settled a players-filed lawsuit asking for compensation for life-altering head injures. The problem is, most of the costs associated with treating those injuries were borne by the players' health insurers. Under the concept of subrogation (a common feature in health, auto and other indemnity-based insurance products), the players waived their rights to any amounts rewarded that could go towards reimbursing those carriers. It's not really "news" except that most people haven't read their policies, and are unfamiliar with the principle.

■ Next up, this helpful info courtesy of FoIB Jeff M:

"COBRA considerations when Medicare-eligible. Clients may not realize the need to combine them."

A lot of folks who've recently retired (voluntarily or otherwise) opt for COBRA continuation of their previous coverage, since that's often the path of least resistance. But that may, in fact, be disastrous:

"With rare exceptions, COBRA coverage is secondary to Medicare Parts A and B ... The result is that when Medicare-eligible individuals do not have Medicare Parts A or B, they are left to pay 80% of their costs out of their own pocket."

And that's not all:

"Medicare has a window of opportunity to enroll in Medicare Parts A and B that lasts eight months after leaving employment."

Miss that special enrollment opportunity and you're facing a lifetime of fines once you do manage to sign up, which could also be a while.

Good info here.

■ Finally, some news on the viatical front:

"In 2013, the top 15 life settlement providers paid more than $362 million for unwanted life insurance policies."

That "investment" was worth a potential $2.2 billion in death benefits. It's also a major (29%) increase over the previous year. But what's driving this thriving [ed: really?] market?

According to the article, it's a rebounding economy, with institutional investors looking for better returns. I'm not convinced: it seems to me that more and more middle class folks, still hurting in a reduced labor market, are looking for ways to raise capital quickly, and what better way than to sell off unwanted (or unaffordable) policies, raising quick cash and easing the budget?

From the Life Files

So about 30 years ago, my since-retired colleague wrote a policy on a 30 year old client (whom we'll call Gene). Gene's wife was named as the beneficiary, and all was well.

A few years - and two children - later, Gene and his wife divorced, and Gene changed the beneficiary of his policy to his brother.

Problem is, he never told his brother (or his kids) that he was doing so. Recently, Gene passed away, and his ex-wife called me to inquire about the policy. I called the home office and confirmed that a) he did, in fact, have a policy (and it was in force) and b) his brother was the beneficiary (again, news to all of us).

Fortunately, the brother lives relatively close by, and was in town attending to the funeral arrangements and such. I was able to connect with him, and we met yesterday to complete the claims paperwork (we're still awaiting the official death certificate, without which the claim can't be paid).

That's when I learned that not only did Gene never tell his brother about the policy, but that he died without a will (aka intestate for all you legal-beagles). The brother had no idea what Gene wanted to do with the proceeds of the policy (well, the balance after final expenses), nor of his house or other belongings. He's decided that he'll just divvy up the balance with his nieces once all the (modest) estate costs are settled.

This is just so sad: Gene died alone, and never made his wishes known to those that were (ostensibly) closest to him. I suppose there's a lesson here, somewhere, but danged if I know what it is. Any suggestions?

Health Wonk Review - Windy Spring edition

HWR co-founder Joe Paduda hosts this week's outstanding round-up of wonky blog posts, with an emphasis on the ACA. Come for Louise Norris on coverage gaps, stay for Dr Jaan Siderow's "pretty cool" moment.

News from Ms Burntwell

Actually, there are quite a few ObamaTax-related items cluttering the in-box. In no particular order:

■ A dataset which purports to provide "the total number of Qualified Health Plan selections by ZIP Code for the 37 states that use the [404Care.gov] platform." It includes basic plan info about which plans folks in a given area selected during Open Enrollment. It's not clear how many (if any) of these folks actually bought a plan at all.

■ A handy little (one page!) .pdf letting us proles know how much HHS collected from reinsurers in 2014 to offset costs of the Transitional Reinsurance program. Spoiler alert: thus far, less than 75% of target.

■ The death of the insurance agent's role has been more than a little exaggerated. Case in point:

"The drafters of the [ObamaTax] seemed to think that brokers were mostly a waste of money ... For a look at how the new, humbled SHOP exchange system has done since then, read on."

Please do.

The reality is that (competent, professional) agents do far more than just suggest plans designs. They are an integral conduit between the client (individual or employer) and the carrier. Of course, that sales role can't really be underplayed, as witness the fate of the SHOP (Small group insurance exchange):

"HHS has been notoriously reluctant to release any numbers hinting at how many employers or workers might be using SHOP plans"

Any bets on whether that would hold true were it a rousing success?

Thought not.

Now, I happen to be one of those (competent, professional) agents who is authorized to sell SHOP plans. I can tell you that I have yet to experience any employer asking me for a SHOP quote (neither current clients nor prospects). I have suggested to a few current clients that we at least look into it, but when they learn what's involved, well, any interest seems to fade away quickly.

It may be the cumbersome (but intrusive!) data entry process, it may be the confusing requirements, or some combination of these and other factors. But it's certainly not surprising.

And speaking of cost of care....

Yesterday, we noted trends in cost of healthcare over the next decade. But what about the cost of Long Term Care? Well, the folks at Genworth have just released their latest "Cost of Care Survey," including an interactive map and state specific data.

According to the Executive Summary:

■ The National Median Hourly Rate for home ehalth aides is $20
■ Adult Day Care now runs about $69 a day
■ Assisted Living Facilities now north of $3600 a month
■ And full on nursing care is $220 a day (semi-private room)

Now's an excellent time to review your current coverage, or to contact a reputable, independent agent with experience in this market.

In the meantime, you can stop by Genworth for even more in depth analysis and information, including the aforementioned maps and charts,.

[Hat Tip: FoIB Randy G]

What a difference a decade makes...

With the spate of folks expected to retire in the near future, and their (understandable) concern about how they're going to pay for their health care, the folks at LifeHealthPro have put together 5 helpful charts that seek to predict how much that care's going to cost.

Here's the first one, from the perspective of a 65 year old couple:

[click pic to embiggen]

There are a handful more here.

Most Excellent Perm vs Term Review

Over at LifeHealthPro, an insurance agent (and financial planner), eviscerates populist "advisor" Dave Ramsey on the latter's arguments against permanent insurance versus term.

Highly recommended.

Two caveats:

First, I sell a decent amount of term insurance, as it does, in fact have its uses; permanent plans are no panaceas in and of themselves.

Second, I think Michael misses the real problem with the 'buy term and invest the difference" scenario: almost all the folks who buy into this end up spending the difference, not saving it.

An important message from...Brussels?

So this arrived in email:

"Anthem is committed to providing our brokers with best-in-class service, and we are always looking for ways to make it easier for you to do business with us – and to help you better serve your clients. Currently, we’re working with a research firm called North American Testing Organization (NATO) to conduct an online broker satisfaction survey to help us better understand your needs."

I must admit to a bit of a spit-take upon reading that I might be contacted by (that other) NATO, but must settle for these wannabe's.

Be interesting to see what they ask ... I was told there'd be no geography.

How NOT to do Narrow Networks

We've long noted that one of the negative - and completely foreseeable - consequences of the ObamaTax is the rise of so-called "narrow" networks:

"Nationwide, about half of all exchange plans feature narrow networks ... Those narrow network plans cost up to 17% less on average than plans with broad networks."

It also means that you're less likely to be able to keep your doc, or even find one willing to take on new patients.

And it certainly doesn't help when a doctor decides to implement his own version:

"A Long Island cardiologist had the office of another doctor torched, then hired someone who turned out to be an undercover police officer in a failed attempt to have the doctor hurt or killed"

Geeze, doc, have a heart!

Yeah, about keeping your Doc

As we've long documented, increasing the demand for care (more folks with insurance) will of necessity run into the brick wall of supply of said care. That is, when everyone has access to "free" healthcare, who's going to provide it, especially with narrow networks reimbursing providers less and less?

Well, some enterprising Golden State folks have come up with an intriguing (if ill-fated) idea:

"Physician Retraining and Reentry (PRR) an online program designed to give experienced, medically licensed physicians and specialists, retired or otherwise, the opportunity to practice adult outpatient primary care in understaffed clinics across the country."

So the first question would be: um, why now, when reimbursements are at an all-time low and headed south? Follow-up: why do you suppose all these folks retired in the first place? (Hint: see Question #1)

But all is not lost, dear readers, because they've come up with a fool-proof way to fill in the gaps:

"The program has also given new hope to disabled surgeons who are no longer able to practice surgery"

To be fair, the folks at PRR aren't (necessarily) advocating that disabled surgeons start operating again, merely "treat patients in a primary care setting." What, exactly, that would entail is left to the imagination of the reader.

(Sorry 'bout that)

While I certainly applaud the group's willingness to think outside the box, I'm just not seeing a path to success here.

[Hat Tip: Gabriela Torres-Soler]

Who is Reading Your Medical File? The more things change (Part 2)

Last week, we broke the story of how some medical records, particularly those stored on off-shore servers, are likely not protected by HIPAA's privacy reg's. I reached out to Dr Rob Lamberts (whom we've previously interviewed) for his thoughts on this as a provider:

Very troubling issues here.  The question of “who has the record” is the most important one.  There needs to be a certainty of who has access to the records unless the patient is made aware of that insecurity and gives consent.  An example of insecurity is the use of Google Spreadsheets for monitoring blood pressure, etc which people sometimes share with their doctors.  They should be aware that there is an insecurity of these records, and their consent to use them can be seen as acceptable in a narrow usage.  Similarly, the tendency of patients in my practice to communicate via email must be covered by some sort of agreement in which the patient agrees that their use of email is “at their own risk” and that our practice will make every effort to only communicate securely.

The  storage of records in an off-site setting where the actual location and potential access to them is unknown to both physician and patient is troubling.  If the vendor is selling the doctor something that claims to “meet HIPAA security requirements” (which many 3rd party vendors do), then the onus is on the vendor.

I told Rob that I wasn't sure I agreed with that last part: It seems to me that, if I'm coming to you as a patient, I'm presuming that you have my records under lock-and-key, or at least in-house. Why is it my obligation to ask if that's the case? Rob replied:

The contract between a provider and an IT vendor is one where they take on the task of IT security (among others) in exchange for payment.  Legally, the physician has gone into that agreement in good faith, and so the vendor would be liable should there be a breach.  That is the same thing the patient does with the physician, overall.  They assume the doctor is acting in a way that is responsible with the medical records.  While I agree that there is a certain right of knowing where the records are stored, in some way we must trust that those making the sausage are being overseen by others who will make sure only reasonable things are being put into that sausage.  There is a reasonable degree of trust we must all have (which is no excuse for naiveté or gullibility).

Okay, that makes good sense from the provider's POV. I'm still not convinced that a doc using a vendor with off-shore servers isn't obligated to notify his patients of such. Now, one might argue "well, Henry, how's the doc to know?" To which I'd reply "simple: ask."

Why not?

And a Special IB Thank You to Dr Rob for his insights and willingness to share them!

The 4% Solution

Heh:

"Only 4% of people who signed up for ObamaCare got the correct subsidy"

Oops.

Expected, of course; actually, I'm surprised the "success" rate was that high. After all, calculating one's subsidy necessarily meant that one was guesstimating the next year's income. Since I've never seen a Ouija board with a $ sign on it, this always seemed...unlikely.

And it didn't help that the IRS sent out faulty forms to over three quarters of a million suckers filers, "nearly all of [whom] are being told they'll have to wait, maybe until Oct. 15, to straighten it out."

Oh goodie!

The good news (for certain values of "good") is that folks will get to repeat this process again in a mere 12 months. One wonders if a) the IRS will finally have the correct forms available and b) significant numbers of suckers citizens will choose to play again.

Time will tell.

[Hat Tip: RedState]

HillaryCare -> ObamaTax

So, who made this promise:

"If you like Blue Cross, you can keep your Blue Cross"

If you guessed President Obama, well: close, but no cigar.

That one comes from a 1994 meeting laying out strategy for the future SoS's health care "initiative:"

[click picture to embiggen]

 Time after time....

[Hat Tip: Ace of Spades]

Dumb Prospect Tricks

So, as I've mentioned before, I'm often the recipient of referrals from other agents. Yesterday, I fielded a call from one such that still has me shaking my head.

The setup:

John is referred to me by a (his?) local State Farm agent for information on signing up for health insurance. Since Open Enrollment season is (finally) over, the first order of business is to determine whether or not he and his family are eligible to even buy a plan.

Turns out, none of the family (2 parents, 4 kids) has been insured for a while: the folks for over 20 years (!) and the kids for several (they had apparently been covered by Medicaid/SCHIP some years back). So, no obvious path there.

Turns out, though, that The Mrs has a job offer in another state, and they'll be moving there. She's been asked to determine the cost of a health insurance plan, to be included as part of the comp (she'd be a 1099 employee). So, John wanted to know how much a plan would cost.

Pause.

The good news, I explain, is that since they're moving to another state, they'll be eligible for a Special Open Enrollment. The bad news is that I'm not licensed in that state, don't know the market or the plans, nor do I know if he'd be subsidy eligible, so there's no way to know rates, let alone best options. I explain all this, and offer to hook him up with a local agent, but John's insistent, really wants to lock down a number. So I told him that it would likely range between $2,000 and $50,000 per year.

He didn't like that.

So I explain - again - why I can't just give him a number, and he abruptly hangs up on me. What to do?

Of course, "the sticker" provides a quick answer, so I hopped over to the NAABC site to find a few agents in the Austin, Texas area, and emailed those to him (along with the site for determining subsidy eligibility).

I do understand that he needs this information, but it really isn't as simple as he'd like to believe. And since he's essentially asking for me to provide my services for free, I'm not really clear on why he thought his attitude was going to be all that helpful.

Dumb.

One step forward, two steps...

So, even as the 2105 Open Enrollment season was (illegally) extended and expanded, turns out all was not a bed of roses, especially for Tar Heel State residents:

"North Carolina had a higher attrition rate out of Obamacare exchange plans than many other states."

North Carolina uses the Federal Exchange (like 36 others), and saw only about three quarters of its ObamaTax enrollees re-up this year. There doesn't seem to be any clear-cut explanation for the large discrepancy between different states' attrition rates.

That last observation may, in fact, be key: what, exactly, drives folks in different areas to either sign up or forgo coverage from year to year? Be interesting to see the rate differentials between the various states; cost would obviously be a major factor.

[Hat Tip: FoIB Jeff M]

Who is Reading Your Medical File? The more things change...

So, 9 years ago, Bob wrote an eerily prescient post on the future of health records:

"In a time zone 17 hours ahead, a radiologist in Australia, working for a company called NightHawk Radiology Services, had been sitting before the same images ... In an effort to hold down costs, hospitals and other medical practices are outsourcing certain functions half way around the globe."

Turns out, one of those functions is patient record-keeping.

About a month ago, we wrote a long term care insurance policy for a very nice couple. Sam and Sally are relatively young, and in good physical shape, but pretty much every case requires an APS (medical records). Generally, the carrier sends a request (and a check) to the doc, who then instructs his clerical folks to get the records together and faxed/emailed over to the carrier. This can take a couple of weeks, but it's not usually a major roadblock.

Until now.

Seems that Sally's doc uses an off-site electronic records keeping outfit, which relieves the doc of certain administrative costs and burdens. But according to the way the contract is written, the vendor may specify that it will only fulfill these kinds of requests once a month. Here's the first problem: let's say that Sally's doc's vendor’s contract specifies that requests are fulfilled on the 15th of each month. So Doc Smith sends the request on the 13th, no problem.

But if he sends it on the 16th, we've now just lost one month. And this is significant, because the underwriter can't finish...underwriting…without the records, and so that app just went to the bottom of the pile.

Not a pleasant thought.

Here’s the next problem (they keep getting "better"): Sally had no idea that her doc was using such a service. When she called to find out why the doc hadn't sent her records, she was told that the doc had, in fact, requested them over two weeks ago. Unfortunately, no one told the carrier, which has been waiting patiently, and the vendor hasn't returned phone calls asking about status.

And to add further insult to injury, Sally also had no idea that her records were being stored not just off-site, but on a vendor's cloud server.

Why is this a problem?

Well, let's skip down a bit in Bob's 2006 post:

"Most are aware of the privacy laws that come as part of HIPAA but few stop to think about how much of that law is lost once your medical information leaves the shores of the United States."

That is, HIPAA stops at the border. So here’s a question: exactly where is the vendor's cloud server physically located? Denver? Or New Delhi? Makes a difference: if the former, HIPAA applies, if the latter...

So here's a question: does the doctor have the obligation to notify his patients that he is, in fact, using such a service? Does he have a further obligation to determine whether or not his patient’s PHI (Private Health Information) is, in fact, protected by HIPAA?

In Part 2, we discuss these issues with Dr Rob Lamberts.

[Hat Tip: FoIB Randy G]

Life Insurance Snapshot

Hard to believe, but it's been almost 7 years since we blogged about Progressive Insurance's (then) new "Snapshot" program, a "high-tech monitoring device [which] makes it possible to reduce insurance premiums for drivers who avoid jackrabbit starts and slam-on-the-brakes stops...The catch? Bad drivers who take a chance on the program may wind up paying a surcharge instead."

Insureds merely "snap" (get it?) the widget into their cars, and their speed, distance, etc are then uploaded to the carrier, and rates adjusted accordingly.

Now, what would you say to applying that tech (or something very much like it) to humans?

Well, thanks to FoIB Holly R, we learn that John Hancock is proposing to do just that:

"Once you sign up, John Hancock sends you a Fitbit monitor as one way to track your fitness. You earn Vitality Points for your activities. As you accumulate points ... the more you save each year on your life insurance premiums." [emphasis in original]

And those savings could be substantial: up to 15% off your premium. The downside, of course, is that if one starts to slip, premiums creep back up (maxing out at the original rate).

Of course, privacy advocates aren't necessarily thrilled by this, and I have to admit that it's got a whiff of Big Brother going on. But - and this is key - it's completely voluntary, so I'm not really too put out by it.

Another objection is that "the plan will raise insurance costs for lower-income people juggling two jobs who don't have as much time to get to the gym." Which is, of course, a valid point, but it's exactly backward: their costs don't necessarily go up because someone else's goes down; it's not a static value.

It'll be interesting to see how many folks take advantage of the program, and how it ultimately pans out.

ADHD and Mortalit ... Hey look, a squirrel!

So, one of my favorite medbloggers, Dr Kevin Pho, has an interesting post up at his blog about ADHD and early death. Written by Dr Claudia Gold, it's about a recent study that purports to show that "diagnosis with ADHD doubles the risk of early death." Dr Gold then goes on to discuss the clinical issues involved (although not clinically - it's actually a very fascinating article, and well worth the read).

I had an immediate, visceral reaction though: as always when reading these kinds of articles linking Condition X to increased mortality risk, I tend to say "show me the money." That is, the folks who have the most to lose (or gain) from this type of information are those whose actual money is at risk: life insurance carriers.

I quickly checked a couple different life insurance apps; none of them mentioned ADHD by name or acronym. Of course, they all ask about meds, so if one was on Ritalin, for example, then that condition would likely show up.

So, I reached out to one of our esteemed underwriters to see what affect, if any, such information would play in determining insurability. After all, the insurance company stands to make (or lose) a lot of money if they misunderstand the underlying issues.

The good news is that, in and of itself, ADHD is not generally a disqualifying condition, although depending on severity, one's rate may be better or worse than someone without the condition. What was interesting, though, and echoed Dr Gold's take, is that there are often other conditions, such as anxiety or depression, that are often associated with an ADHD case, and that these could very easily affect an underwriters decision.

Folks whose ADHD is well controlled, and who are stable as a result, have little to worry about, especially as adult. Where it gets dicey is in children (and, one presumes, especially teens, although I didn't specifically ask about them).

The bottom line, then, is that the ADHD iteslf is unlikely to be much of a challenge, it's the associated conditions that could cause an underwriter to balk.

Something to consider next time you're shopping for life insurance.