Bond, College Bond

Readers may recall our post last month regarding the plight of Oberlin College in Ohio. At the time, they had just lost a lawsuit brought against them by a local bakery that the college had apparently victimized. As we noted at the time, the institution's insurers may balk at covering it at all:

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

But wait, it gets better (well, for certain values of "better"):

"Will Oberlin College be able to secure a bond? Probably, but it might not be as easy as you would think."

What's this about a bond, you ask?

Well, as expected, the college is appealing the rather large judgment; the challenge is that such appeals take a while, and the interest alone on that sum is over $4,000 a day. The Gibson family is concerned that Oberlin might metaphorically "bleed out" and have nothing on which they can collect:

In Ohio, folks (and institutions) that wish to appeal an award are free to do so, but must post a bond which essentially guarantees that the amount will be paid if the appeal is lost. It's important to note that, as our good friend and guru of P&C Bill M points out, a bond is not an insurance policy, but a 'financial instrument.'

Okay, so what?

Well, in the post we excerpted above, it's claimed that the carriers "writing these appeal bonds want to take zero risk."

Which is kind of the anti-thesis of insurance, which is acknowledging and underwriting for a specific risk. In this case, the carrier(s) will want to have some pretty substantial collateral to back up their guarantee of such a large sum. This could be in the form of cash (as in the school's endowment), and/or buildings and equipment. The point is that, unlike a typical insurance policy, these plans are not risk-based.

That may yet prove to be critical.

[Special IB thanks to Bill M for taking the time to help us understand this]

Area 51 Insurance?

I could have sworn we'd blogged on this topic before, but apparently not:

"Florida company offering 'alien abduction insurance' has sold nearly 6,000 policies"

And such a deal, too: for under a Jackson (or two sawbucks) one can buy $10 million worth of coverage.

But there's a slight catch.

Click on through to find out what that might be.

Oh, and no word on whether or not that Edgar suit is covered.

[Hat Tip: FoIB Sam B]

Disability Insurance Case Files: Grey Collar edition

Grey collar folks are generally defined as those that fall in-between traditional white collar (accountants, engineers) and blue collar (mechanics, truck drivers). In this case, my client (we'll call him Steve) owns and operates a drywall contracting company, and splits his time about 75/25 between being on the job and manning the office.

Disability Insurance (DI) is designed to replace income lost from a serious illness or injury, and one of the key components in computing a premium is assigning an occupational rate class. A typical white collar class might be 3A or 4A, while a typical blue collar might be 1A. The higher the class, the lower the rate, so obtaining a favorable rate class is desirable.

In Steve's case, he might be a 3A but for the amount of time on the jobsite. For that reason, Assurity Life (which is the carrier we'll likely be using here) classifies him as 1A., but then bumps him up to 2A because he owns the business.

A very nice compromise, resulting in both substantial savings and additional benefits options.

When Steve called me about buying DI, I also asked if he knew about Business Overhead (BOE) insurance. Turns out, he didn't, and so I explained that, while DI puts food on his table and keeps a roof over his family's heads, BOE coverage helps pay the office bills (rent, lights, phones, etc). He immediately expressed an interest in that coverage, as well.

But here's the rub: for Business Overhead Expense plans, Assurity still considers him a 1A category, and ineligible for coverage.

What to do?

Well, as usual when I hit a brick wall, I called on the fine folks at Petersen International, who did, in fact, have a market for this coverage (in normal-speak, that means they could write such a plan). Which was the good news. The not-so-good news is the coverage, which has a 3 month waiting period before benefits are paid and a 1 year benefit period, clocks in at roughly $3,000 a year premium. . At $5,000 a month benefit, there's a total of $60,000 of potential claims, but that premium (which does include some helpful riders) tops $250 a month.

/gulp

Unlike "regular" DI plans, BOE premiums are (generally) tax deductible to the company, which helps lower the plan's net cost. Still, it's a big chunk, especially when one isn't used to paying for such coverage.

Will be interesting to see if he pulls that trigger.

Tuesday Linkage

In no particular order:

■ As we've long documented here, Britain's Much Vaunted National Health Service© has a fetish for offing innocent children:

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

The poor 6 year old was another victim of free health "care."

Fortunately for Oliver Cameron, his parents were afforded a unique, lifesaving opportunity:

"[T]hanks to the tireless efforts of his parents and doctors at Boston Children’s Hospital, Oliver is alive and thriving today."

He had been born with a non-cancerous tumor, the likes of which British doc's were unable to treat.

#MedicalTourism tourism in action.

■ Meanwhile, on this side of The Pond, our northern neighbors, subject to whims and vagaries of CanuckCare©, seldom fare so fortuitously:

Canadian Medicare, our northern neighbor’s universal health care system, generally receives rave reviews from proponents of socialized health care, yet the Fraser Institute found that more than 63,000 Canadians left their country to have surgery in 2016. https://t.co/BnUwfDavYd

— Dutch Rojas (@DutchRojas) July 18, 2019

But hey: Free!

■ And finally, our friend Allison Bell alerts us to the latest Health Savings Account news:

IRS Notice 2019-45 will help HSA holders use high-deductible plans to pay for insulin, statins, etc. on a pre-deductible basis - and it shows that the IRS can tweak the HSA deductible rules by expanding the HDHP preventive services package. https://t.co/jRdhz8dd2j

— Allison Bell (@Think_Allison) July 18, 2019

Unfortunately, this will be of benefit only to those who own HSA-compliant plans, which of course means duplicate and unnecessarily expensive coverage for folks in ACA versions.

Once again I'll ask: why must one own a specific type of insurance plan (or, indeed, any plan) to have an HSA?

(Yeah, I know)

Some Good LTCi News

John Hancock, long a fixture on the Long Term Care insurance scene, is enhancing some in-force plans, at no additional cost to their insureds):

"We are excited to let you know that John Hancock is planning to pilot a variety of wellness programs for our Long Term Care (LTC) policyholders that will provide them with information that may help them live longer, healthier, and more independent lives."

Nice!

(Particularly for those with lifetime benefits)

The first one, called LIFT Wellness is a voluntary program that includes an in-home visit by an RN who will "conduct an assessment, and may recommend certain [lifestyle] changes and/or home modifications with a focus on fall prevention."

The program itself is being offered free of charge, one presumes that the cost of any actual renovations done will be borne by the insured (which is fair).

And speaking falling, our friend Roger D reminds us that some Medicare Advantage plans offer a complimentary fall detection device with 24 hour monitoring. Be sure to ask if your plan offers such a benefit, too.

Claims Management: A Tale of Two Carriers

A ways back, I wrote some disability insurance coverage on a young surgeon: some with Union Central Life (now Ameritas) and then later some more with MassMutual. Both solid carriers with excellent reputations.

Recently the surgeon became unable to work due to a series of severe (and acute) medical issues, and may actually need an organ transplant as a result. Needless to say, he's out of the OR for a while, maybe permanently.

Because these plans were written so long ago, and I no longer actively represent either carrier, there are hoops through which we need to jump to bring me "back in the loop" so that the various claims folks will talk to me about the pending claim. No problem, understand completely.

So my client asks the claims rep for each carrier how to make that happen. Both basically say they just need to hear from me and they can get that ball rolling. So I emailed both and, after not hearing from either for a day, called and left voicemail.

The MassMutual rep promptly returned my call, and explained that she'd never received my email. I went and looked and, sure enough, I had mistyped it (I blame fat fingers); so re-sent it, and we're all good. We had a lengthy conversation, much of it taken up with my concern about why they were asking for tax records (so is UCL/Ameritas). I'll circle back to why that was even an issue in a moment, but for now I'm satisfied with the MassMutual rep's explanation.

As for the Ameritas rep?

Well, it took a week, but she finally emailed that she'd been out of the office, and that she needed something in writing from the client to be able to speak with me about his claim.

Fair enough.

While I await that, let me explain my initial reluctance about letting my client provide tax returns:

In general, the carrier only gets to underwrite for health and finances at the time of application. After that, it's really none of their business, and I bridled at the idea that they were going to attempt some kind of post-issue financial underwriting.

When I questioned the MassMutual rep about this, she said they needed it if and/or when he goes back to work; it wasn't necessary to get the claim ball rolling.

And that was the mental "click" I needed to remind me that we had included a Residual Disability benefit in the plan, and that this would absolutely need the kind of income verification that a tax return could provide.

Oh, what's a Residual Disability benefit?

Basically, it's a partial benefit the company pays to help make up for any loss of income one may incur when going back to work after having been disabled. I usually describe it as being paid "when you're okay but your wallet's still disabled." This could be due to reduced hours or fewer duties (and thus lower a lower paycheck).

So, I'm okay with th MassMutual rep's explanation, and anticipate a similar conversation with the Ameritas/UCL claims person, as well.

Insurance Fraud & Complacency: A Tweet Story

This is at once fascinating and disturbing:

1/ A woman discovered her ex husband was defrauding health insurance companies for millions. She tried bringing him to justice. It didn’t go as expected.

(This story is one of the wildest I’ve reported.)

Here’s what happened:

— Marshall Allen (@marshall_allen) July 19, 2019

UPDATE: Here's the #Unroll if you'd prefer that format.

[Hat Tip: FoIB Holly R]

Interesting (and sad) case

Had a call the other day from an acquaintance whose 30-something daughter had been experiencing severe and debilitating health issues for the past two or so years. She had lost significant weight (and she was hardly exactly 'zaftig' to begin with), and had begun seeking non-traditional, "alternative medical" treatments, to the tune of tens of thousands of dollars.

My acquaintance called because he knew I dabbled in the health insurance field, and hoped I could give his family some advice and insight on what options might be available.

Oh, there's an interesting twist, which may play an integral part: the daughter, who had never given up her US citizenship, had nonetheless spent the past few years living abroad, and had moved back here just before she became ill.

This is important, because one of the Special Open Enrollment triggers is "Changed your primary place of living." Now, it actually gets more specific:

"Moves that may qualify you for a Special Open Enrollment Period [include] ... To the US from a foreign county."

Which seems a slam dunk, but then there's this caveat:

"Important: To qualify for an SEP, you must prove you had qualifying health coverage for at least one day during the 60 days before your move except moves from a foreign country)." [emphasis in original]

This is crucial because it seems to be referring to the so-called "60-day rule;" that is, you must exercise your SEP opportunity within 60 days of becoming eligible for it. I think she's missed that window, but I'm not entirely sure, and so I urged my acquaintance to call the nice folks at the Marketplace to confirm, and also to see if the daughter might be eligible for a subsidy.

We then looked at what plans and carriers were available in their area, to get an idea of costs and benefits. The less expensive Bronze level plans were, of course, very affordable even without the subsidy, but the out-of-pockets were pretty hefty. The other issue is that, at least in Ohio in 2019, all plans are built on an HMO chassis, which means basically zero out-of-network coverage, which might be an issue (or maybe not: after all, she doesn't have insurance now).

Okay, that's the insurance side, but maybe there's another line of attack open to us?

And indeed there may well be:

I then suggested that they also consider other options. For one thing, a call to the local Medicaid office might be helpful: those folks have access to information on all kinds of medical financing options.

I also asked if he was aware of Direct Primary Care. I explained that these practices worked like a gym membership, with monthly dues granting 24/7 access to a physician. They also often have big-ticket diagnostic equipment in the office, saving even more (eg: MRI's costing hundreds of dollars, not thousands), as well as discounted prices on meds. They are also very helpful in referring patients to fellow cash-only-type providers in the area for non-primary care services.

I promised to send him the link to the latest directory of DPC practices, but I also cautioned him to beware that they aren't much help with catastrophic medical issues, and that's something to consider, as well.

Looking forward to seeing how this plays out and, of course, always happy to help.

A Deadly Conundrum: Updated

Last fall, we reported on this tragic story:

"California dad charged with insurance fraud after he drove off cliff, killing autistic sons"

Turns out, "Father of the Year" (non-)contender Ali Elmezayen had purchased the policies just over two years prior, presumably planning ahead to avoid the contestability clause which "allows the carrier to review a recently approved policy to see if there were any misstatements or misrepresentations" and goes away after the first two years. So it appears that Mr E thought that a two week "cushion" would be sufficient.

Ooops:

"A father has been charged with capital murder after his two autistic sons tragically drowned when he drove his family off a Port of Los Angeles pier in California ... Just before the incident, Ali had purchased several accidental death insurance polices.."

And of course "accidental death" nature of the plans was a nice touch: these policies are generally a fraction of the cost of a regular term or whole life plan. And if the goal is to collect in a couple years anyway, who needs long term premium guarantees?

Be a darned shame if anything untoward happened to him in prison.

Stupid Agent Tricks: Sometimes I despair

So one of my hats is CE (Continuing Education) provider. My primary role in that capacity these days is "back office support;" that is, I file courses for state approval, create and provide class rosters and completion certificates, and file completed class rosters to the states in which I'm a licensed provider. Unfortunately, I don't get much opportunity these days to actually teach, and I miss that dearly.

Anyway...

One of my CE clients taught a couple classes the other day (well, technically, the same class, twice, at two different locations). She had previously taught this same class last fall (at the same locations). In Ohio (and, I imagine, in most if not all other states), one cannot get credit for taking a course more than once in a cycle. Determining whether or not this applies is fairly simple; agents can check their transcripts online in a matter of seconds.

Of course, this doesn't always happen, and in today's little object lesson, 5 of the 15 students at Location 1, and 2 of the 8 at Location 2, had taken this exact same course within the past 6 months.

And it gets better (for certain value of "better"): for at least 15 years, agents have been required to use their National Producer Number (not their social security or state insurance license number) to sign in and get credit for a course.

Let me repeat that: the NPN requirement is a decade and a half old.

Which of course 2 students completely ignored, causing me to then go to the state insurance department website and drill down to their personal info and obtain that information so that they could get their CE credits.

And these rocket surgeons "advise" their clients on transactions worth thousands of dollars.

Yikes.

Heads' up for cancer

Today is especially relevant for my late sister's friends and family:

July 17, 2019 is Glioblastoma Awareness Day. We hope today will bring added awareness, building on the efforts of the GBM advocacy community and organizations like @NBTStweets who have dedicated so much time and energy to fighting this disease and supporting those affected by it.

— Lindsey Graham (@LindseyGrahamSC) July 17, 2019

Please pass the word.

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:

NEW: Stetson Baptist Church in Florida pays off $7.2 million in medical debt for 6,500 struggling Central Floridianshttps://t.co/DmAPU6hbYk

— Ryan Saavedra (@RealSaavedra) July 10, 2019

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."

Ooops.

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.

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).

#ForWhatItsWorth

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?

#Medicaid4All

[Hat Tip: Ace of Spades]

From the 'Be Careful What You Wish For' files

Shot:

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

Chaser:

"Burn in hell, you sorry SOBs"

#Pithy

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]

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:

"Great!

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.

Another STM Dilemma

A Twitter friend pointed out that:

If someone tries 2sell U a health insurance plan and says it is #ACA compliant, affordable and covers U from day 1, Stop, get the name of the company and get a 2nd opinion. ACA plans do not cover U from day 1 and cannot B purchased after open enrollment without an SEP situation. https://t.co/2jQdv5iRGr

— Sheron E Sidbury (@SheronESidbury) July 8, 2019

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.

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.

Sure, sure, but hey: Free!

https://t.co/zcu1xnvtfx

— Lynne (@EFSBenefits) July 6, 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!

Happy Independence Day!

Alternately:

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."

"Coincidentally."

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 404Care.gov 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 64½.
 

Alas and alack.

So, suggestions welcome.

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.

#ScaryTech

■ 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.

#GoodLuckWithThat

■ 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"

#13A

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:

"When she decided to plan a getaway to England with some girlfriends, they purchased travel insurance ... When the company ... sent her the insurance policy, she sat down to read it."

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!

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.

Ouch.

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]

Interesting!

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

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.

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."

'Miss'

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?

Well:

"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.

#Medicaid4All

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.

MOST IMPORTANTLY.......I'M STABLE!!

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.

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:

New HHS Rule Regarding Manufacturer Drug Coupons Impacts ACA Cost Sharing Limits https://t.co/BUD5EGwSKQ

— Healthcare Reform (@Health_Reforms) June 17, 2019

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.

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....

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?

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.

Sweet!