Monday, July 15, 2019

Congress Won't Whack the Cadillac

The resurgence to repeal the Cadillac Tax is front and center - again. This time it is due to the overwhelming support in the House of Representatives which allows for a bill to move to the floor when there is a supermajority of co-sponsors.

In this case the Middle Class Health Benefits Tax Repeal Act of 2019 has 361 co-sponsors - 83% of all members.

So, why then with such huge bipartisan support will repeal fail? It is simple, from an IB post back in January of 2018:

"But here's the truth. Congress needs the Caddy Tax. They need it for the revenue on paper. When CBO scores in ten year windows it shows an accounting sleight of hand that many of us don't know. It shows as revenues - whether collected or not. 
Having IOU's is how they trick us in to believing that they are good stewards of our tax dollars. Sad truth is they simply don't care about spending your money. They care about you voting to re-elect them. Which is why kicking the can down the road is the avenue of choice for those we elect in DC."

In this installment of Congressional drama the supermajority will use the opposite angle saying that they can't kill the tax without offsetting revenues. They will again claim to be good stewards of our tax dollars and voice how much they dislike the tax.

But when the dust has settled the Cadillac Tax will live. Probably to never see the light of day except on those occasions where playing politics allows it to briefly see the light of day.

No good deed....

From our friend Holly R:
Which is a sweet gesture, until one realizes the unintended consequence:

"According to the IRS, if you have canceled, forgiven, or discharged debt for less than the amount you pay, the amount of the canceled debt is taxable income."


Now, the taxes on this difference are, obviously, a lot less than the debt itself, so this isn't a slam on the idea. But if the recipients are unaware of the largess, or of this tax rule, they may be in for a nasty surprise at year's end.

"You get a car, and you get a car..."

Adds up.

Friday, July 12, 2019

Rx Anecdate: Contra-Narrative

At my recent annual physical, i was prescribed, at the tender age of 39(shut up), my first-ever maintenance med: 10 mg daily of Lisinopril for moderately high blood pressure.

[ed: this came as somewhat of a shock, inasmuch as I'd heretofore been considered a carrier]

It's become fashionable of late to dump on Pharmacy Benefit Managers (PBM's) and specifically Aetna and CVS. Well, I'm insured under an (HSA-compliant) Aetna plan, and I had the scrip filled at my local CVS for the princely sum of .... wait for it ... $2.21 for a monthly supply.

I think we can swing that (at least for the nonce).


Thursday, July 11, 2019

Bon voyage! [UPDATED]

UPDATE: Monsieur Lambert has passed away.

"Vincent Lambert, 42, died Thursday in a hospital in Reims nine days after doctors stopped providing artificial feeding and hydration, ending years of legal flip-flopping over whether to keep him alive."

[ed: original post below]
The name of the French national health care system, La Sécurité Sociale, pretty much guarantees that this would be the outcome:

"French Quadriplegic Being Starved To Death By The State"

In 2008, then 31 year old Vincent Lambert was left in that condition as a result of a terrible car accident.

Flash forward 11 years, and the poor man has been ordered starved to death by the (warm, compassionate, caring) French government:

"The Cour de Cassation overruled an appeals court which had directed doctors to keep Mr Lambert alive pending a review of his situatoin by the Unitoed Natons Committee on the Rights of Persons With Disabilities."

This echoes Iceland's take on Down Syndrome babies:

"Iceland is on pace to virtually eliminate Down syndrome through abortion."

Inconvenient, non?


[Hat Tip: Ace of Spades]

From the 'Be Careful What You Wish For' files


"Cone Health CEO Terry Akin urged staff to contact legislators to advocate for hospitals' position on the issue."


"Burn in hell, you sorry SOBs"


Short take:  North Carolina Health Plan honchos have proposed a new reimbursement scheme for Tar Heel State hospital systems that include some pretty draconian caps, and one provider's manager followed orders (maybe a bit too zealously).

[Hat Tip: Co-blogger Bob]

Wednesday, July 10, 2019

Sigh: Some folks just don't 'get it'

So, working with a customer who needs a short term medical plan for his wife, who is an American citizen living abroad. I was able to find only one carrier that didn't require a recent stateside residence, and so I quoted that carrier. As always, I quoted using the maximum lifetime benefit (in this case, $1 million). The client asked about $1,000 and $2,000 deductibles (which I think is a mistake, but that's what he asked for).

So I quoted as he asked, and the premium came out to $325 per month for the $1,000 deductible plan, and $256 a month for the $2,000 version.

He balked at that, claiming that I'd previously quoted a much lower rate. I pointed out that we had been looking at a $5,000 deductible (which would have been well under $200 a month). He thought that still might be spendy, and he would check with his home country's options. I wished him well and told him that I'd be happy to write this plan if the home country option didn't pan out.

This morning, I get this in email:

"This quote sounds good to me.

What if I take insurance for 250 G instead of million and keep deductible to 1000 or so?

This [home country plan] is world wide known. May be you can also use them check it out.

The currency conversion is Rs 70 to a dollar, so the premium is about $150 for 3 month.

Please let  me know your thoughts

[ed: it was unclear if that was $150 a month for 3 months, or $150 one-time premium]

This is becoming tiresome (we make very little on Short Term plans, and he's quickly using up the commission)(and my patience).

I replied:


No, I can’t sell for non-USA companies.

>> $250 G

No, I can’t do that: I will only sell the maximum benefit (for a number of reasons: E&O liability chief among them, also you really don’t save all that much lowering the maximum vs raising the deductible)

We'll see what he does.

Not really on tenterhooks here.

By the way: there's another very good reason to not skimp on that policy max: insurance is, essentially a gamble (yeah, yeah, I know) and it's a lot easier to come up with an extra three or four thousand dollars than 10's or 100's of thousands.

Tuesday, July 09, 2019

Another STM Dilemma

A Twitter friend pointed out that:

Although I knew what she was saying, I asked for clarification (to make sure we were on the same page), and she helpfully responded:

"When you sign up 1-15 you are not covered until the First of the following month. From the 16-31st the plan starts the 1st of the second month."

That is, if you sign up on June 3rd, your coverage doesn't begin until July 1st. And if you sign up September 17, your coverage doesn't start until November 1st.

This is where a Short Term Medical plan could come in mighty handy (too bad for the folks in states such as Connecticut and California, that outlaw them).

Sexist Stats

So, got this yesterday from the CDA (The Council for Disability Awareness):

"In a new survey of the awareness and ownership of disability insurance across today’s workforce, The Council for Disability Awareness (The CDA) uncovered that the 32 million, unmarried women workers, who make up 25 percent of today’s American workforce are underinsured for a disability."

Which is, no question, a shame.

But I immediately replied:

"That’s interesting.

How about similar stats on men, who make up 66% of the workforce?

I’ll wait…

Breath status:

[x] NOT held.

Monday, July 08, 2019

Off Topic: Two Great Causes

So last Friday evening, we attended a local food truck rally (and very cool fireworks display) and learned about two very worthy causes:

Warrior Weekend to Remember honors combat injured vets and Gold Star families (and even first responders and their families) with an incredible weekend experience that includes:

- Indoor Kart racing
- Skydiving
- Hot air balloon rides
- A bonfire and concert

And more!

Click here to learn more about this fantastic program.

■ The 1st Annual PNC Community Mutt Strut is coming up in October, and includes a dog parade, vendors and food, even door prizes. Approximately 22 veterans a day commit suicide, and it's the Mutt Strut's purpose to change that by providing service dogs to vets with PTSD, brain injuries, and other combat-related mental health issues.

You can learn more about the organization, and the parade, by clicking here.

Saturday, July 06, 2019

Friday, July 05, 2019

Sidebar News: Life Happens

Been meaning to do this for a while, but was challenged finding "just the right one."

People often ask me "how much life insurance do I really need?" I have a special form that I give these folks to do their own assessments (lest they think I'm "goosing" the numbers). But in this digital age, I realized that it may be preferable to offer an online tool, preferably one that keeps such information anonymized.

A friend suggested that I have a gander at the Life Happens site, and sure enough, there's a very nice, intuitive, anonymous widget that I think fits the bill quite nicely. Available now in the sidebar, under "Resources."

Check it out!

Thursday, July 04, 2019

Wednesday, July 03, 2019

Who knew?

That India had adopted the HMO model:

"An Indian man who had been declared dead woke up just before he was set to be buried during a funeral ceremony."

He'd apparently been in an accident and was taken off life support, "coincidentally only after the man’s family told the hospital that looked after him they no longer had the funds to pay for his care."


Yeah, go with that.

Confounding Case Bleg

Co-blogger Bob offers a poser:

"Unusual situation referred to me by agent in another state.

Mother-in-law relocated to Atlanta from Pakistan. Green card holder, age 71. Health status unknown (didn't ask). Looking at possible options. Coming up empty or "are you kidding".

■ Medicaid - possibly the best option depending on how they define household income.

■ Obamacare - I assume she can qualify but no subsidy. Outrageous premiums and OOP

■ International travel medical - pre-ex snake pit

■ Health share ministry - must be Christian? Other religious affinity including Muslim? Pre-ex? Not readily accepted by docs/hospitals since no guarantee of payment. HSM is a very remote possibility but want to throw that out as an option

I checked the site, and was surprised to learn that "Gained citizenship or lawful presence in the U.S." triggers a Special Open Enrollment opportunity.

So, armed with her new zip code, I went plan shopping. The least expensive option was a Bronze level Blue Cross plan with a $6,750 deductible and a $740 a month price tag.

The advantage, though, is that it's guaranteed issue and pre-existing conditions are covered right away.

Since we don't know her health status, it's impossible to determine whether or not other non-Medicaid options would work (since they all have either underwriting, or pre-existing conditions limitations, or both).

I also thought about "Dave's Plan," but the age cut-off for that is

Alas and alack.

So, suggestions welcome.

Tuesday, July 02, 2019

Tuesday LinkFest

■ Item #1:

"Medtronic recalls MiniMed insulin pumps as FDA warns about hacking risk"

This is a major issue with the whole Internet of Things phenom. The danger, of course, is not just the threat of ransomware 'per se,' but that actual lives could be put at risk.


■ Item #2:

We haven't heard from our friends at the MVNHS© lately, let's correct that, shall we:

"NHS beds crisis 'critical' as more sick Brits left stranded in hospital corridors last month than at the height of winter"

Which is even more alarming, in that the stated goal is to have no more than 85% of available beds occupied.


■ Item #3:

So-called "balance billing" (aka "surprise billing") is nothing new to regular readers:

"These hidden providers are like gunslingers in the wild west. They are not beholding to any rules and are free to charge whatever they want. If you don't pay they can ruin your credit and there is little you can do about it other than pay up."

The problem has only gotten worse over time, and there are all kinds of ideas being proposed to try to rein it in (including forcing out-of-network providers to accept in-network pricing). Some folks even think t should be illegal to engage in the practice.

But what about the other side of the coin?

Former Solicitor General Paul Clement makes the legal case for balance billing:

"The ability to refuse to accept an insurance plan is what gives doctors leverage when negotiating their rates ... [which] would likely violate the First Amendment's guaranteed freedom to assemble, as well as the Fifth Amendment's protection against government "takings"


Monday, July 01, 2019

It pays to read the mice type

How many times are we told to "read the fine print" versus how many times we actually do?

Well, here's a case where someone did, and it paid off bigly:

Which turned out to be quite providential:

"We estimate that less than 1 percent of travelers that purchase a travel insurance policy actually read   all of their policy information — and we’re working to change that.”

That's nice, but how, exactly?

So glad you asked:

"[T]he first person to email the company and mention the fine-print contest [will] win $10,000."

And so she did, and so she did. 

Mazel tov!

Friday, June 28, 2019

From the HSA Files

I just learned something new (to me).

Recently, one of my small group clients had to let a long-time employee go. The plan itself is HSA-compliant, and the employer (very generously) funds each employee's account with $750 a year. He also covers the lion's share of the premium.

The unfortunate employee reached out to me to see what his options were. The group wasn't large enough to be subject to COBRA, but here in Ohio we have a so-called "mini-COBRA" law that guarantees (in specific circumstances) that the employee can continue his group plan for up to a year (paying the full freight, of course). One can imagine that this gets, as my dear departed sister used to say, "spendy:" in this case, upwards of $1,000 a month for the employee and dependents, all while he's between jobs.


One option we explored was a short-term medical plan, which would be much less expensive (under $300 a month) but which has its own limitations.

Here's where it gets interesting: I recalled that one could use HSA funds to pay for COBRA premiums, but wasn't sure if that would also include "mini-COBRA" state continuation plans.

So I reached out to our gurus of all things HSA (and FSA, and HRA) at FlexBank, who assured me that:

"HSA funds can be used to pay for Cobra and State continuation premiums.  See attached list of qualifying expenses for the HSA under eligible expenses." [emphasis added]

[ed: that list is available to interested readers, just drop us a line]


So, I don't know yet which way the former employee will go (if at all), but at least he has another funding option.

Thursday, June 27, 2019

Case File: Whole Life insurance dilemma

A few months back, we considered the case of the gentleman who had passed away after he'd let a policy lapse, and the implications thereof:

"I asked for the policy number to which it referred, and advised him that when the policy lapsed last year it created a taxable event, and that the balance due is being treated as taxable income (which would have also been the case if my client was still with us)."

That is, letting a policy with a substantial loan against it lapse is a sure-fire way to trigger a potentially hefty tax bill.

Flash forward to earlier this week, and I field a call from another agency client who had some questions about his life insurance policy. In this case, the policy was still in force, but also one he had bought from another agent long ago (and with a carrier we don't represent). So I of course offered to help as best I could (because he is an agency client) but that my answers would of necessity have to be pretty generic.

The facts were these: the gentleman, now in his late 70's, had purchased a whole life plan from XYZ Life while in his 30's. Over the intervening years, the policy's cash values had grown (substantially), and he had borrowed heavily against them, such that his original $200,000 death benefit is now reduced to about $20,000 (yikes). The problem is that the loan keeps growing, and if he doesn't at least freeze it, the policy will lapse.

Okay, so what? If he no longer needs that policy, what's the big deal with just letting it go?

Well, as mentioned above, that will trigger a pretty sizeable tax bill, one that he may well wish to avoid (being on a fixed income and all). So by paying the interest, in addition to the premiums, that should freeze the loan. The goal, I explained, was for him to die before the policy does. In that case, the loan, and potential tax bill, die with him.

Morbid, I know, but also honest.

He asked if he should pay all the interest, and I said that would be ideal, but even just paying some of it will help to forestall the inevitable.

To which he replied: "oh, I get it, paying some of the interest shows my good faith effort to the IRS."

Um, no: the IRS (and the carrier) couldn't care less about "good faith efforts," it's all about the Benjamins.

Pretty simple, that.

The lesson here? Consider all the long term implications, and ask questions, before stripping the cash out of a policy.

Tuesday, June 25, 2019

Like a Viking!

Back in 'Aught 12, we noted that the Norwegian national health care scheme was starting to buckle:

"[T]he E.R. is simply not open at this hour ... What? There’s not always a doctor at the E.R.?"

That would be a 'no.'

And even that model of competence Sweden had begun feeling the pain:

"Swedes also complain about not being able to see their own regular general practitioner"

Life under government-run health "care."

But things are changing; co-blogger Mike alerts us to the newest developments:

"It’s intriguing that while socialists in America would rush to nationalize the health care system, Norwegians, Swedes, and Danes are all gradually increasing their use of private health insurance."

Wait, what?

How could this be?

Well, the numbers tell a very interesting tale:

"Between 2006 and 2016, the portion of the population covered by private insurance increased by 4% in Sweden, 7% in Norway, and 22% in Denmark."

Remember that when Medicaid4All proponents here tout the wonders of government-run health "care."

Trump Executive Order and HSA's

One of the bullet points in yesterday's order focused on the use of HSA's for Direct Primary Care and Health Sharing Ministries. To those in these types of arrangements, you might want to dial back your enthusiasm.

Why do we say this?

One first must remember the requirements to fund an actual Health Savings Account. Straight from the IRS website...

To be an eligible individual and qualify for an HSA, you must meet the following requirements.
  • You are covered under a high deductible health plan (HDHP), described later, on the first day of the month.

So, to fund an HSA to pay for DPC or HSM you must pay premiums and purchase an insurance plan. Nothing like paying premiums for insurance so that you can set up an account to draw funds from said account to pay for more "insurance."


Via FoIB Holly R, this latest from the rascals at the MVNHS©:

"Coroner demands NHS 111 changes after six-year-old Sebastian Hibberd's death "

And what, you may ask, is the context here?


"Sebastian Hibberd died after staff failed to spot warning signs that part of his bowel had collapsed."

After which he experienced cardiac arrest while, and sit down for this, he awaited medical attention.

You don't say?

But what could possibly have led to this tragic outcome?

Would you believe ... math?

"[C]all handlers were not being "adequately assisted" by the algorithm used to assess patients over the phone."

Those darned algorithms will get you every time.

Cannot wait for us to implement that here.


Monday, June 24, 2019

What is the Medicare Hospital Benefit?

Medicare Hospital benefit Part A covers medically necessary inpatient charges incurred and billed by the hospital. GA Medicare expert Bob Vineyard explains.

Original Medicare has a PER ADMISSION deductible. In 2019 the amount is $1364. Charges incurred during the next 60 days are covered by Medicare.

Most Medicare supplement plans, also known as Medigap, pay that deductible for you.

You may also incur OUTPATIENT charges in the ER and treatment or consult by medical personnel who are not on staff. These charges are applied to your Medicare Part B coverage.

Howdy Gramps, great to see ya!

We've written before about (so-called) Grandfathered Plans, most recently here:

"... as frustrating as it is, their current policy is the least bad alternative (at least until the next Open Enrollment period)."

A good blog-friend of mine recently wrote about her experience with her own grandfathered plan. She's a long-time MS patient, and had this to say:

"I finally received the hospital bill for my Feb 4th Rituxan infusion. That was my 36th infusion since Nov 2009. At first we tried stretching out the time between infusions, but I was still relapsing. After a relapse in Nov 2011, we went to the every-6-month schedule. I didn't relapse again until Feb 2016.

That's amazing!

So back to the bills. I'm a number cruncher and keep track of all sorts of things. For those 36 infusions, the hospitals have charged $539K in total. More than half a million dollars, folks! Insurance okayed charges of $458K of which $399K was for the Rituxan itself. Because of having a grandfathered individual insurance policy, my copay for infusions/drug has been limited to $22,857.24.

This is what I need to remember to appreciate my current monthly insurance premiums of $1028 (which will certainly go up again after my annual renewal in September). So from 2009-2019 (11 years), I will have paid at least $87,732 in insurance premiums, BUT my out-of-pocket maximum has been limited to $27,500, the most of which has been allotted to Rituxan infusions. (Vision, dental, and other prescriptions not included.)

So..... for $115,232, I have received half a million dollars worth of medical care for a single pharmaceutical treatment and have spent only about $5000 OOP for doctors, MRIs, or ER visits.


That's my gratitude thought of the day. The same day I worked outside in the yard for at least 4.5 hours this morning and experienced difficulty walking and gripping at times and really only want to sleep right now. Stable does not mean no symptoms or never any problems

Well first: Baruch HaShem that she's not getting worse (which is always a danger with MS).

It also puts into perspective something that doesn't always get much play regarding ACA plans: not only do they tend to have very narrow provider networks, they also typically include restrictive formulary benefits for meds. As we've long noted:

"The stated reason for this business model is that it helps carriers to rein in the cost of medications, which make up a disproportionate percentage of claims."

But it presents a major challenge to folks with, for example, MS (let alone cancer or diabetes).

My friend continues:

"I'm very fortunate that my current treatment is an infusion therapy, otherwise it would be a very different story.

It does support the extra cost of keeping that grandfathered PPO plan tight within my grasp for as long as possible. The $100 deductible, 10% co-insurance, and $2500/year OOP max (for med coverage) are priceless. Good thing I'm not taking any expensive oral or self-injectable drugs; $1500 max coverage for pharmacy drugs doesn't go very far. All generics for me

Bottom line: keep that legacy plan for as long as you can.

Friday, June 21, 2019

Rx Heads' Up

If you have an ACA plan and take prescription meds, you'll want to be careful about using those now ubiquitous manufacturers' coupons:

The key is whether there's a generic equivalent available. The problem here, it seems to me, is that this ruling doesn't seem to take into account folks for whom the generic just doesn't work.

Caveat emptor.

Thursday, June 20, 2019

From the P&C Files: Every step you take, every mile you drive....

Hard to believe but we first wrote about driver tracking and insurance over a decade ago:

"A high-tech monitoring device 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."

So a reasonable, if potentially risky, trade-off. But that was then, and this is now (11 years on). Surely we've mined collected enough data to determine the efficacy of these programs and devices, no?

Well, thanks to FoIB tsrlbke, the results are in, and they're (generally) positive:

"[A] new business study involving Washington University in St. Louis provides analytical theories showing that such driver-monitoring technology can not only prove beneficial to the bottom lines of some consumers, but also to insurance companies by alleviating moral hazards that affect the risks of accidents."

Which makes sense: careful driving motivated by potential insurance savings is obviously more likely to result in fewer accidents and tickets.

On the other hand, privacy-minded folks might want to take heed of this:

"They install it in your car, and it records all your driving patterns: Where you have been?"

Talk about trade-offs....

Wednesday, June 19, 2019

Sunshine State Health Insurance Anecdata

So recently, had a client move to Orlando, and asked for a referral to a local health insurance agent (since I'm not licensed for Florida). I reached out to some folks who might be of help, including a couple relatives. One very helpful kin had this to say about the state of individual medical plans there:

"We don't have an agent. About 2 yrs ago Florida Blue, the only insurance provider in our area, drastically cut commissions so independent agents are almost non existent. Do you know where he is moving? Basically the way I approach it is to find the insurance company with the best network (in Florida there are only two main cancer centers - Shands and Moffett). If you get in a narrow network you could end up in trouble if you have an unusual health problem since the local expertise may not be that good.

I think Florida hospital is pretty good in Orlando but if you have something unusual you may need to go to Moffett in Tampa. I would just be sure the network includes Moffett. Florida Blue likely has plans in Orlando and basically you buy a policy from them using salaried agents on their staff. I would caution them against getting a narrow network plan that does not include Moffett or Shands. It will be cheaper but they could end up with a bad outcome from not having the right expertise on your side. With [your sister's] illness dealing with Shands was a pleasure. Not just the quality of care but no financial hanky panky which is common in Florida

I mentioned that salaried carrier sales folks makes sense, since The Blues are (apparently) the only game in town, and got this reply:

"What happened is that they cut commissions to such a low level most agents quit selling health policies including mine."

Ah, yes, we're quite familiar with the concept.

Interesting, no?

Tuesday, June 18, 2019

CBD Oil: An Update

Regular readers may recall our post from last month on insurance and CBD oil:

I had an interesting conversation with a doc who specializes in pain management and is a big fan of CBD oil and its pain-reducing abilities. He also claimed that taken topically (ointment) or even orally, one would likely not get flagged on a drug test."

Well, I recently received this in email from one of my group clients:

"Hi Hank!

Brought to my attention and I didn't know:

CBD oil/salves for anxiety/depression/pain management?

Has anyone asked you about these for HSA write offs?

Which is a great question.

I did some research, and thought I'd found the answer:

"CBD products are probably not considered HSA- or FSA-eligible, though there hasn't been any formal guidance from the IRS on the matter. This is similar to medical marijuana, which is also not HSA or FSA-eligible even if you're taking it for a diagnosed disorder or to reduce the effects of chemotherapy"

But just in case, I also reached out to our own gurus of all things HSA/FSA/HRA. Their answer surprised me:

"Although we have received no official guidance, it’s seem reasonable that with the passing of the 2018 Farm Bill it can be reimbursed through FSA and HSA’s with a doctor’s note prescribing it for a specific diagnosis."

So there you have it: the key is in that little script fom the doc.


Monday, June 17, 2019

When is a QSEHRA *not* a QSEHRA?

Regular readers may recall our post last year on the debacle that was Qualified Small Employer Health Reimbursement Arrangements (QSEHRAs):

"Their reaction, once learning about the caveats and limitations, has been a resounding /crickets ... the devil truly is in the details."

In other words: a dud.

But that was then, and this is now:

"The Health and Human Services, Labor and Treasury Departments joined forces on a new initiative intended to provide affordable health careOpens a New Window.  coverage ... The legislation will expand the use health reimbursement arrangements (HRAs), allowing employees use pre-tax health arrangements to buy insurance."

First impressions:

This sounds great on paper (maybe), but what differentiates this new effort from last year's failed version?

I reached out to our gurus of all thing FSA/HRA/HSA for their initial take, asking if this was just a QSEHRA re-hash. They graciously responded that it is not last year's iteration, but a new alphabet soup, almost 500 pages long, with a lot of details. They also pointed out that the original QSEHRA was a flop because of all of the rules, and that this version may be as well.

I would add something else that seems to have slipped under the radar in both instances:

Group plans have participation requirements; that is, a minimum percentage of employees must be on the group plan or it will go away (I've had this happen, and it's not pretty). To be fair, it's not usually enforced that rigidly, but I suspect that would change if carriers saw their groups suddenly shedding participants willy-nilly.

Now, as one who would ultimately like to see health insurance de-coupled from employment, this is not unappealing. But as a realist, I think this is playing a little too close to the edge of the envelope.

And there's this: pretty much all group plans are built on the PPO model (coverage in- and out-of-network). But all of the individual plans I've seen the past two cycles (and I have no reason to think this won't continue to be the case) are HMO's, meaning that there is essentially zero OON coverage.

What's that worth?

Oh, and one more thing: if your employer offers a group plan, then you likely won't qualify for a subsidy on that individual major med. And since ACA plans include pretty much all the things that make group coverage so expensive (guaranteed issue, pre-ex and maternity cover, for example) plus often (usually?) have much higher out-of-pocket limits, not seeing the savings.

Time will tell.

Friday, June 14, 2019

From the P&C Files: ProActive CyberCover

A few weeks ago, we blogged on active shooter insurance cover:

"Beyond the obvious (wrongful death and medical and funeral expenses), there's counseling, biohazard cleanup, and destruction of property; in some cases, relocation and rebuilding expenses might also come into play."

And of course the list went on.

An active shooter in the workplace is obviously a deadly physical threat, but there are other attacks that can wreak significant damage (and also threaten lives). I recently received an email from an outfit called JGS Insurance, which offers what looks to be pretty comprehensive cybercrime coverage.

Um, what the heck is "cybercrime," Henry?

Well, Techopedia defines it as:

"[A] crime in which a computer is the object of the crime (hacking, phishing, spamming) or is used as a tool to commit an offense (child pornography, hate crimes). Cybercriminals may use computer technology to access personal information, business trade secrets or use the internet for exploitative or malicious purposes."

This is a fairly broad brush, but seems to pretty much sum up the phenomenon.

So, back to that "cyber warfare" coverage.

The JGS program identifies two specific parties:

First Party coverage includes response and other immediate costs, including legal and regulatory, as well as unauthorized funds transfer, plus system damage and even business interruption.

Third Party coverage would be for risks like network security and privacy liability (think of all the various database breeches we hear about, with personal and credit card info being stolen), media liability and even technology errors and omissions.


Something I really appreciated was this checklist of why businesses ought to be considering this type of plan:
• Cyber crime is the fastest growing crime in the world, but most attacks are not covered by standard property or crime insurance policies.
• Systems are critical to operating your day to day business but their downtime is not covered by standard business interruption insurance.
• Data is one of your most important assets yet it is not covered by standard property insurance policies.
And quite a few others, including penalties for loss or theft of data and the compliance costs of notifying those affected.

Scary, but interesting, and worth considering.


They also point out that it's "it's not just big businesses being targeted by hackers, but lots of small ones, too."


Thursday, June 13, 2019

Gibson vs Oberlin: Update (Breaking)

Yesterday, we wrote about the unfortunate case of the college versus the bakery:

"A jury has awarded Gibson’s Bakery and its owners $11 million in compensatory damages against Oberlin College, for libel, intentional interference with business, and intentional infliction of emotional distress."

We noted that the trial to determine whether (and for how much) punitive damages had started, and that these could amount to a tripling of the original amount.

We noted at the time that it's unlikely that these would be covered, should it come about.

Well, we're about to find out:

"Oberlin College hit with maximum PUNITIVE DAMAGES (capped at $22 million by law) in Gibson’s Bakery case"

That's gonna leave a mark.

Click the link for details.

La Plus Ca Change

Saw this on Twitter:

"What if, instead of focusing on "consumer driven" or "people powered" health care, we turned our efforts instead to "Open Source Health Care?"

[ed: note the date]
What if, indeed?

Wednesday, June 12, 2019

Common Medicare Questions - GA Medicare Expert Answers

#GAMedicareExpert #CommonMedicareQuestions

Oberlin Gets Schooled

As you may have seen, Oberlin College (a private liberal arts school in northeast Ohio) was recently successfully sued for trying very hard to put a local bakery out of business:

"A jury has awarded Gibson’s Bakery and its owners $11 million in compensatory damages against Oberlin College, for libel, intentional interference with business, and intentional infliction of emotional distress."

So how did this come about? Well, a couple years ago some yutes ... er ... underage Oberlin students tried to buy adult beverages, and when they failed to produce proper ID, decided to just help themselves. Even though they were arrested and eventually pled guilty, the college bureauweenies decided that this was obviously racially motivated by the shop's owners, and proceeded to act accordingly:

By passing out fliers accusing the business of racism, and urging customers to take their business elsewhere (the flyers helpfully included suggestions as to alternate merchants, aka competitors). In fact, at least one administrator was actively handing out these flyers.

The store sued the college, and has won a judgment of $11 million; yesterday saw the start of a hearing for an additional 22 million in punitive damages.

Okay, that's very interesting, Henry, but what the heck does it have to do with insurance?

I'm so glad you asked.

Turns out, at least one of the school's insurance carriers is likely to deny coverage:

"[I]t appears that the insurer, Lexington Insurance Company, is likely to disclaim coverage for the intentional torts which gave rise to the verdict."

Lexington had issued a commercial liability umbrella policy, which (as is typical of these plans), "does not provide coverage for “bodily injury” or “property damage” intentionally caused by defendants."

Think of it like this:

As we've pointed put before, one's homeowner’s policy is unlikely to cover the shooting of someone, even if that shooting was entirely lawful. It's that whole "intentional act" issue. And, as our guru of P&C Bill M points out, it doesn’t get more "intentional" than having your vice president and dean of students deliberately undermining a local establishment while calling its owners racist.

Bill also pointed out that coverage for the (expected) punitive damages may be in doubt, as well, since these are generally excluded.

R'unh r'oh.

Bill and I were also curious about the underlying coverage, which was not through Lexington, but by the "College Risk Retention Group, Inc. (“CRRG”) and an Educator’s Liability policy issued by United Educators (“UE”)."

Turns out, CRRG is "a privately held company in Burlington, VT and is a Single Location business."

How enlightening.

And what about UE?

Well, they provide "liability insurance and risk management services to more than 1,600 members representing schools, colleges, and universities throughout the United States."

No word yet on whether that includes intentionally sabotaging a local business.

Tuesday, June 11, 2019

It's Deja Vu All Over Again

Chaser (from 2012):

"Many of those who refuse, or are unable, to prove they are citizens will receive free insurance paid for by those who are forced to buy insurance because they are citizens."


Monday, June 10, 2019

Skin in the Game?

So, saw this the other day:
I've had a few cases over the years where there was either current or a history of skin cancers (usually benign), but wanted to confirm this claim.

So I reached out to the ever-helpful folks at Issue Insurance (our local experts on difficult cases), and FoIB Tana H replied:

"Certain types of skin cancers can be an issue, especially, malignant melanoma. There are definitely a lot of variable’s involved, such as size, level, stage, etc.  Most can be written standard or with a flat extra for so many years."

The more you know....

Monday Transparency

Price transparency in health care has long been a recurring theme here at IB, going back to our earliest days:

"Recently, I had the opportunity to interview Dr Dexter Campinha-Bacote, Aetna Medical Director. He’s the “go to guy” for Aetna’s new transparency pilot program ... employers asked Aetna to develop tools that their employees could use to make “better informed decisions.” One of these tools is the pilot transparency program."

But we also know that for transparency to work, there has to be buy-in from health care providers, as well. And so:

"Makary is part of a movement of medical professionals who want healthcare to reflect the free market, with transparent pricing and clear information on quality, allowing patients to decide which entities succeed and fail, rather than the insurance companies"

The Free Market Medical Association (FMMA) now boasts over 20 chapters nationwide, and now offers "an online pricing tool where patients can find prices and quality information for cash pay physicians."

That last bit is important: I've never had a client ask about how to find the cheapest brain surgeon.

Pretty cool.

[Hat Tip: Brandon Dutcher]

Friday, June 07, 2019

From the P&C files: If a tree falls...

Now that summer storm season is in full swing (stay safe, folks!), we can expect to see a lot of stories about downed trees. So how does one's homeowner's insurance work when that happens?

[ed: as usual. coverage varies by plan and state, so  be sure to consult your own agent about your specific coverage]

The fine folks at Cincinnati Insurance have put together a helpful video about the subject:

And they've also provided an infographic to help us understand the signs of a dead or dying tree.

Thursday, June 06, 2019

What could go wrong?


Wednesday, June 05, 2019

POP Goes the Premium

I attended an interesting Continuing Education class yesterday on Understanding Tax Implications of voluntary group products (like dental and vision, etc). One question that came up was about the wisdom/pitfalls of running these premiums through one's POP plan, and we'll explore that in another post.

But it reminded me about this post from my gig; it's an explanation of what a Premium Only Plan is and why it can be a valuable extra benefit:

Because of wage controls put in place during the Second World War, many of us get our health insurance benefits through our employers. As times have changed, and the cost of these benefits has risen, most employers who continue to offer group insurance coverage have required employees to foot more and more of the premium burden.

Typically, this involves deducting the employees' share from their paychecks. So, along with FICA and FUTA and the like, one also sees a deduction for health insurance coverage.

The employer's share of the premiums are generally tax deductible to the company, which reduces its net cost. An employee's share can also be tax deductible, but there are some hoops through which the employer and the employee must jump. Employers contract with Third Part Administrators (TPA's) to set up so-called "POP" plans (for "Premium Only Plans"), which are allowed under Section 125 of the Internal Revenue Code. POP plans are relatively simple, straightforward documents that enable employee premiums to be deducted pre-tax; that is, from gross wages rather than after-tax.

There are a number of immediate benefits to this process, and a few drawbacks. The primary advantage is that deducting premiums pre-tax effectively lowers the employee's net taxable income, saving tax dollars. This also lowers the employer's tax liability, so it's a win-win. The employee ends up with a few more spendable dollars as well as health insurance coverage.

There are also two potentially significant drawbacks:

First, by reducing taxable income, the employee is also reducing his (or her) Social Security income. That is, a lower gross wage can result, over time, in a lower Social Security benefit at retirement time. Most people aren't aware of this, and those that are may not be very concerned: after all, retirement may be many years away, and a higher paycheck today is an immediate pay-off.

The second challenge is that once an employee elects to participate in a POP plan, he's generally locked into it for the rest of the year. So if his circumstances change, it may be difficult or even impossible to opt out of the plan in the middle of the year. For example, if Bill signs up for his company's group coverage in January, and then decides in March that he'd really like to drop it because it doesn't fit his needs, he probably won't be able to opt out of the POP plan until the end of the year.

On the other hand, if he (for example) gets married and elects to switch to his spouse's plan, that's a "qualifying event" and he can make that change mid-year.

This "lock-in" provision takes on new urgency with the Affordable Care Act (ACA). While most POP plans run from January through December ("calendar year plans"), many others are set up on a non-calendar year basis. Many employees currently covered under their employer's group plan may elect to cancel that coverage in favor of one of the new Exchange-based individual medical plans. If their employer has a non-calendar year POP plan, they may not be able to make that change in January.

There's good news, though: the IRS has stated that employers with non-calendar year based POP plans may amend them to allow employees to drop off of (or join!) these "cafeteria" plans effective January 1, 2014. The employer has to determine whether or not to allow this change, but it seems reasonable to presume that most (if not all) of them will.

Goodman Hits a Homer

As usual, FoIB John Goodman has the definitive takedown of why so many on the left just don't 'get' the economics of health care [ed: To be fair, lots of rocket surgeons on the right are equally ignorant]. In his latest Forbes essay, John points out that:

"Editorials like the one in the Times tend to treat a dollar spent on health care as though it is different from a dollar spent on something else. It isn’t. It’s the same dollar ... In a Public System, Patient Needs Compete against Taxpayer Needs"

He also notes something else that often goes unremarked: that Medicare plans are generally administered by private (commercial) insurance companies.

And why is that?

Well, you'll want to read the whole thing to see why that actually makes a lot of sense.

[Hat Tip: Co-blogger Bob V]