Author Anthony Nefouse

Small group health insurance renewal from July 1 to the end of the year just got really interesting.

If you have been following my blog posts, then you may have read an article titled “What Is “Grand Mothering” And How It Will Impact You?”

Grand Mothering is the ability to keep your current group health plan, even if it isn’t compliant with the Affordable Care Act in Indianapolis.

Why would you want to keep your current group health plan?

Well…because of the cost!

The current non-ACA small group health plans cost much less than the new ACA-compliant plans. We are talking 35-55% cheaper, which is a huge percentage.

Under the ACA, the non-compliant plans will not have any pre-existing coverage provisions. These plans are going to have the definition of “Legacy Plans.”

Have you experienced a rate increase?

It might be valuable for you to take a look at the new ACA-compliant plans if you have received a large rate increase in the past or if your employee base is, on average, older. In high utilization groups, we have seen some rates actually go down. This has happened! It is very easy to pull the numbers and plan designs for the new ACA-compliant plans.

If you decide to move to a new ACA plan then you will not have the option of moving back. If you stay with your “Legacy Plan” you cannot make any plan changes.

Small business could gain huge savings.

This is the time a small group should consider new options. Under the ACA, there are some advantages that have not been revealed to most small groups in the area. These advantages could create huge savings for your company and your employees. If you are interested in learning about a new approach to health insurance, contact me, Tony Nefouse, at (800) 846-8615.


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Is it legal to move an employee from my group health plan to the a guaranteed issue individual plan?

This is a big question with a lot of money on the line for employers and insurers.

During open enrollment (October 1, 2013–March 31, 2014), anyone could have purchased a health plan either on or off of the exchange. Keep in mind that if an employee has access to a group health plan, it might disqualify them from receiving tax credits on the exchange, but not on the actual health plan.

A University of Minnesota’s law professor had a paper published back in 2010 that predicted this exact situation. If you read the paper, you will see it was predicted that employers would redesign their health plans to intentionally try to move high-utilization employees off of the group plan. I, on the other hand, would disagree that a plan would be designed with that being the primary intention.

This issue opens up a very interesting discussion for large self-funded groups. This issue would not impact small companies that have fully-insured premiums. On large self-funded plans, the employers pay the initial claims up to a certain point. That certain point is called “stop loss” insurance. It is exactly what it sounds like, stop the losses.

Under these arrangements, the reinsurance contract to initiate a term is called lasers. Lasers (excluding individuals or setting a unique, higher pooling level for individuals who are expected to have large claims, increase customer liability) are optional, depending on risk tolerance .

An example would be a group that has a stop loss limit of $125,000 per person on the plan. This means the company is going to pay the 1st $125,000. There is a high claimant that is projected to have $700,000 in claims. The reinsurance contract has the ability to laser and moves the $125,000 stop loss to $400,000. Now, the employer is responsible for that $400,000.

At this point, options may be entertained on controlling cost. With the new Affordable Care Act, an option that might be discussed is moving the high claimant to an Individual health policy during open enrollment.

To learn more about how we can help your business, give us a call at (800) 846-8615 and we will be glad to sit down with you and answer any questions you may have.


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Did you or a loved one lose health insurance coverage in the last few weeks? You might still be able to get insured under special enrollment if you have a qualifying life event.

Every health insurance provider has different requirements to get insured, but they all follow the same set of guidelines put in place by the Federal Government under the Affordable Care Act.


Here are the most common reasons for loss of coverage and the documents and/or requirements needed:

  • Termination of employer contributions

Requirement: Letter from employer to verify termination

  • Exhaustion of COBRA coverage

Requirement: Certificate of Creditable Coverage and/or COBRA term letter (proof of prior health care coverage)

  • Loss of employer sponsored health insurance as a result of termination of employment

Requirement: Termination of coverage letter

  • Termination of short term medical plan

Requirement: Termination of coverage letter

  • Divorce or legal separation (loss of coverage under spouse’s health insurance)

Requirement: Certificate of Creditable Coverage (proof of prior health care coverage)

  • No longer eligible as a dependent due to age

Requirements: Letter from carrier indicating dependent is no longer an eligible dependent

  • Death of a spouse (loss of coverage under spouse’s health insurance)

Requirement: Termination of coverage letter

  • Spouses employment terminates (loss of coverage under spouse’s health insurance)

Requirement: Certificate of Creditable Coverage and/or Term Letter (proof of prior health care coverage)

  • Employer reduced working hours (no longer eligible for group coverage)

Requirement: Letter from employer to verify

  • Current plan change to eliminate coverage for certain groups (e.g. part time workers)

Requirement: Letter from employer to verify

  •  Group coverage terminates due to non-payment of premium – Employees can use this as a QLE  

Requirement: Letter from employer to verify

  • There is a health claim that will meet or exceed the plan’s lifetime limit on all benefits

Requirement: Explanation of benefit validating lifetime benefit met

  •  2014 Renewal

Requirement: Renewal letter from existing carrier

  • Non payment of premium, misrepresentation or fraud

Requirement: Reinstatement denial letter or rescission letter

  • Relocation/ Move

Requirement: One of the following is required to validate coverage is in force:

      • Other carrier information:
      • Name of carrier and phone number
      • Effective date
      • Termination date
      • Policy number
      • Type of coverage
      • EOB with Effective date and termination date of coverage

One of the following is also required:

      • Proof of new residence (e.g. mortgage document or rental agreement)
      • Driver’s license with current residence
      • Utility bill with current residence

Some of these requirements are easily obtainable whereas others are a little more difficult. The main problem at the moment is that the health insurance company or marketplace will request a copy of your Certificate of Prior Coverage (COC), but you won’t be issued this document until your previous plan has been terminated. It can take up to a month to get this document from your previous carrier.

Some insurance companies are putting a time limit of 15 days to provide this document. This is not a realistic time frame. If you are applying for a health insurance policy on the exchange, you can’t submit your application until you lose your current coverage. Then, your new plan will start the following month. This is not ideal because you could end up with a gap in coverage.

Here at Nefouse & Associates, we will look for other documentation that will satisfy the insurance companies. Tackling individual health plans off of open enrollment can be a difficult and stressful task. Let the experts at Nefouse & Associates take the stress off of you. Call us today at (800) 846-8615!

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Senator Rand Paul has been one of the biggest critics of the Affordable Care Act. You might remember when he took out a policy on the marketplace for his family, which placed his son in Kentucky on Medicaid. He told the public over and over his woes of trying to sign up, trying to pay and the general confusion about if he was actually signed up.

Now, Senator Rand Paul, is saying repeal is unlikely.

In Indianapolis, we have had about 100,000 people get health coverage because of the ACA law, and many Hoosiers have benefited from tax credits. We placed a large amount of people on the exchange which brought about huge tax credits. Older couples went from $1,400 per month to only $300 per month after the tax credit! 

Large families that were accustomed to paying $1,200 per month are now paying only $500 per month. Many Hoosiers were able to place dependents on Medicaid programs when they did not even know they were eligible for enrollment.

Then there was the “Holy Grail” benefit of the ACA: guaranteed issue! No matter how you felt about the new law, this was the one aspect that everyone could agree on. The ability to obtain a health policy without being denied is a positive impact of the law no matter how you look at it.

Despite all of the positives, there are still a few segments of Hoosiers that are not benefiting from the ACA, but instead being penalized.

First is our middle class, who do not qualify for tax credits. They have seen large rate increases in health premiums. Next are the group health plans being provided by small group employers. On average, these plans have seen 35-55% rate increases. This is going to be a huge problem for local small businesses. 

Recently, Indianapolis agreed to allow “grandmothering” which will extend non-ACA compliant health plans. The administration, both locally and federally, have realized how big of a negative impact the ACA is going to have on small groups.

Going forward, the opponents of the ACA will have plenty of arguments to make about the cost of the law. The proponents will have a difficult time defending the cost. The other issue is Hoosiers having to make decisions about new doctors and taking on more risk in out-of-pocket.

It does not matter if you agree or disagree with the law, you have to make the best decision for you regarding your health policy. That’s where we come in! We can help you make an informed decision. Call us today to get started at (800) 846-8615. 

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There is a new term starting to be used called “grandmothering” by business owners and controllers of companies with less than 50 employees.

Grandmothering, is the term that the federal government is using to extend current non-Affordable Care Act policies until 2016.

On March 5th 2014, the United States Department of Health and Human Services issued the “Extension of Transitional Policy”, which will allows small groups and individuals to keep non-grandfathered plans for two more years, with renewals on or before October 1, 2016.  On March 31st the state of Indiana agreed to allow this extension.

How does this impact you?

If you are running a group health plan that elected the early renewal, you may have the extension of that plan until 2016. You will still have a renewal process but you should see a small rate increase.  How can I predict your rate increases being low?  The groups that are left on the early renewals are running well from a claims standpoint. The insurance carriers do not want to lose accounts that are profitable.  It’s an assumption, but I think it is accurate. Most small companies may want to take this offer.

Individual Plans and Grandmothering

I can’t predict what decision the carriers are going to make regarding the individual plans. We could see some carriers offering the grandmothering and others opting not to.

If you are able to take the grandmothering of your current individual plan, it may be in your best interest.  Now if you qualify for tax credits on the exchange, you may want to contact me to get those rates and plan designs.

We should have more official statements from all the carriers in the next couple of weeks.

As always, feel free to contact me with any questions you may have regarding grandmothering or health insurance in general.

Anthony  Nefouse

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We have been in the trenches with the healthcare reform roll out also known as Obamacare. We have seen and experienced all sides of the new Affordable Care Act (ACA) law and the impact it has had on Hoosiers.

The Affordable Care Act has had a huge impact in the area, along with the rest of the country.

There has been a lot of good things about the new law. Many Hoosiers and their families have had huge benefits.

The Good

1. Guaranteed Issue. No one can be turned away for health insurance because of ongoing health conditions. This is one of the biggest positive aspects of the law. Many Hoosiers were able to obtain new health insurance who were originally denied coverage. I can’t begin tell you how many people were able to benefit from this aspect of the law. We had cases where people had been diagnosed with major conditions that were able to get a policy that would cover that condition. This happen both on and off the exchange.

2. Tax Credits on the Exchange. This was one of the primary selling points of the ACA. If your household income fell under the 400% of federal poverty level you had premium joy. There were many early retirees that went from $1,400 a month down to $2oo a month in premium cost. This was huge for many Hoosiers. That kind of savings creates large amounts of disposable income and makes the health policy more than affordable. Large families were able to get significant tax credits. We had families of 5 that were used to paying $1,200 a month and now pay as low as $400 a month. We also saw a lot of individuals get a policy for under $100 a month.

3. Cost Sharing Reductions. This benefit is where the out of pocket max is reduced because household income is under 250% of the Federal Poverty Level. We had families that elected to go with $200 deductible plans with $600 out of pocket costs for very little monthly premium. With the cost sharing reduction we also saw how a Health Savings Account through Anthem had huge incentives. A good example is with a lot of business owners or contract worker. They were able to elect a $1,100 Health Saving Account with 100% co insurance. In this situation they insured would only have $1,100 out of pocket expense for the entire year. Then they are able to write off their medical claims. This option created a tax benefit. Then there were others who had high claims, where this plan was a great choice. Here is an example; if you are incurring $100k a year medical claims and now all you have to pay out is $1,100 this was a huge win especially for Hoosiers that were used to paying large out of pocket fees. This kind of option really can only be explained by a broker like myself that has experience in health insurance and claims.

The Bad

1. Enrollment Process through the Federal Facilitated Exchange. The launch of the website was an absolute disaster. The customer services at the was very poor. The government brought people right off the street that really had no clue about health insurance or customer service. Then when you add in difficult questions, it was a mess. They would then pass you on to management that fell into the same category.

2. Preparation. The insurance community was not prepared for the volume of calls they received. They underestimated what kind of services were needed. This is partly the fault of the government. The insurance industry estimated that they would receive 300,000 calls a day at an average of 12 minutes per call. The actual volume was around 1,000,000 a day with the average time of 29 minutes. The insurance carrier that had resources then shifted everyone they had to assist with open enrollment. This created a lack of customer service representatives for the other areas in the insurance companies like groups.

3. Lack of Information. The market place and insurance companies were unable to provide a summary of benefits of the plans that were being offered. The insurance industry did not have SBC until the middle of February. Hoosiers were buying plans where they had no idea what the benefits where. To make matters worse, the navigators were really unprepared to answer any questions. Even from a broker standpoint we had to do a lot of research to find out what was in the plan designs. I have over 16 years of experience and it took me some time. So there is no way a navigator that has zero experience could help someone understand.

4. Narrow Network. Many Hoosiers were confused about network access. Anthem created a narrow network for Pathway X for exchange business. The online network search feature was down most of January and February. Even when it was working correctly it did not show all of the participating medical providers. Even the medical providers themselves did not know what networks they were accepting. Many Hoosiers had to make decisions about getting new doctors.

The Ugly

The ACA has had a very negative impact on the Middle Class that do not have access to group health insurance. The middle class is absolutely getting hammered with increased premiums. The ACA has initially increased premiums for anyone that in not eligible for a tax credit. This has devastated many families. You take a family of 4 that is use to paying $600 a month for their health saving account plan, now they are paying $1,100 a month. This may be an extreme case where the premium doubled but we witnessed this with about 30% of our clients that were unable to qualify for a tax credit. The average increase was around 60%. Many people were able to get an early renewal and thus delay the impacts of the ACA but that will come to an end in December of this year. I am telling families right now that they are going to have to start budgeting for higher premiums.

Small group health plans also fall into the ugly category. We are seeing anywhere from 35%-55% increases. This type of increase is unaffordable to the small groups and the employees. These rate increases are a direct result of the ACA. In the 4th quarter of 2014 we have over 80% of the small group health plans coming up for renewal. There is going to a mass exodus of small groups dropping these employer sponsored plans because of cost.

On large group health plans we have seen an increase in fees/taxes on premiums. These fully insured groups are getting hit with 4.9% tax increases. Some people may think that is not a huge percentage but if we are talking about $500,000 in annual premium, that is a $24,500 tax increase which goes to fund the ACA. Is that fair? Many owners and employees would say no.

As we move closer to the 4th quarter, the ugly aspect of the ACA will become more and more known.


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now-later320Affordable healthcare is at your fingertips, but time is running out! We are coming to the end of open enrollment on March 31.

March 31 signifies the end of open enrollment for health insurance under the Affordable Care Act. Whether you’re for or against the law, the deadline for getting covered is about two weeks away, so it’s time to sign up or get penalized. Under the Affordable Care Act, most people must be covered this year or face a penalty of $95 per person or 1% of your income, whichever is higher

After open enrollment ends, insurance carriers will be getting back to “business as usual” and resuming their normal operations. During the initial open enrollment period of the ACA, most carriers shifted all their resources over to assist with the on-exchange business. In turn, this created a lack of resources in the other areas of health insurance companies. The main area that was impacted was small group health plans. Here at Nefouse and Associates, we noticed premium notices and new cards not being sent out and hold times for group services sitting at unacceptable levels. Once April rolls around, we are hoping to see these levels go back to some type of normalcy.

If you have a small group health plan (under 50 employees) and need assistance, your best source is a broker. Your broker should have direct access to the insurance carriers and  be able to use this technology in your favor. Be cautious though, because the end of March will not be a good time to try and get things done. There will be a mad dash of people applying for health coverage through the marketplace which will put a strain on resources with the health carriers that are active in the federal or state marketplace.

After open enrollment ends, every small group should start considering their options. This should start no later than July of 2014 since we have already seen what kind of impact open enrollment has on the insurance industry. When it comes to small group health plans, we are seeing average rates increase at around 57%, so it’s time to start doing your research. Right now, employers with 50 or fewer full-time equivalent employees don’t face a penalty for not offering health coverage, but this will not always be the case. Stay tuned to our blog to find out more information on small group health insurance options, or contact us for assistance in finding a plan that’s right for you.

In the meantime, don’t procrastinate any longer, it’s time to sign up for health insurance! If you’re unsure of where to go or what to do, call us at (317) 803-4220!




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HealthCareOct_iStock_000019170348_heroAs the new healthcare laws take firm hold in the state of Indiana, we are starting to see the full impact on small group health plans. Small group health insurance has always been a challenge for many companies over the years due to cost.

Small group health plans are for companies that have less than 50 employees.

Small business owners were supposed to gain more choices and cheaper rates from the new online-health-insurance portals. However, they have been slow to select plans through marketplaces since the rollout started last fall. This can be attributed to several factors including technical problems and the administration’s focus on recruiting individuals and families.

The small business exchanges were meant to offer an online-shopping platform where employers could sort through plans from insurers and offer one or several options to their employees. Employees would then select from the options their employer had chosen, and their rates would reflect any employer contribution. That’s a different process than the one used by the exchanges for individuals, where people can select a single plan to cover themselves and, in some cases, their families.

Most of these healthcare plans are on a fully insured health contract. Under the new law, these plans no longer have medical underwriting. There are also additional mandates that the plans must cover. This creates some serious problems for most small companies. We are seeing an average rate increase of 57% on small group health insurance premiums. 57% is a significant increase not only to the owner but to the employees as well.

You, as a decision maker, do not have to accept this type of rate increase. There are other options for you! These options are going to be “outside the box” of traditional employee benefit thinking. If other consultants want to blame our current administration, that’s fine, but we are working on new solutions.

Employers can apply for coverage through the small-business exchange at any point during the year, and those who are eligible to shop for coverage (firms with fewer than 50 full-time workers) are by definition exempt from rules that will soon penalize companies that do not offer plans to their workers.

Individuals have a limited window, which closes at the end of March, during which to purchase coverage for the coming year. Those who fail to secure a health plan may be subject to a tax penalty under Affordable Care Act rules. If you want a new solution for your group health insurance, contact us.

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affordable_care_actThe Obama administration released 200 pages of Department of Treasury regulations last week. Inside these 200 pages was information about delaying the employer mandate. This is specific to companies with 50 to 99 employees and the delay is until January 1st, 2016.

This is a very big development and is being viewed as political even though they have tried to avoid it. The reality is there are certain industries that are unable to provide health insurance to their employees. These industries usually employ lower wage workers that are unable to afford any portion of the premium or choose to go without it.  This delay will help many of these industries cope with the new law. Businesses with more than 50 employees would have paid a fee of $2,000 per uninsured employee after the first 30 employees, as well as a fee for employees who receive a subsidy through the exchanges. This has been wide spread through many industries.  This new delay may be the beginning of making some changes to the Affordable Care Act law on the employer mandate.  It’s possible that we could see the employer mandate requirements moved from 50 employees to 99 employees.  A small group is defined as under 50 employees but in 2016 that will be moved to 99.

“Much like the individual mandate, the business mandate is bad for middle-class families and will harm economic growth, but the answer to this problem is not random unilateral changes, stoking uncertainty,” House Majority Leader Eric Cantor, R-Va. said.

Also included in the 200 pages of explanation is how to calculate the employer mandate requirement for companies over 100 employees. Businesses with more than 100 employees must offer coverage to 70% of their full-time employees in 2015 and 95% of their employees in 2016.

So far we know that companies with fewer than 50 full-time workers are already exempt from the rule. Volunteer firefighters, part-time teachers and adjunct professors who teach less than 15 hours a week will not be counted as full-time employees, according to a rule released Monday. There will be plenty of interpretation in this change of the law in the coming days.  The issue that will have to be addressed is, if these employees are not being offered coverage and they obtain subsidies, is the company penalized $3,000?

It is becoming more and more difficult for companies to make decisions based on this law when it changes daily.

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chi-blue-cross-blue-shield-health-plans-renew--001Welcome to the new world of health insurance plans under the Affordable Care Act.

Some people have experienced premium joy. This has come from the Federally Facilitated Health Insurance Marketplace in Indianapolis. Hoosiers have been eligible for subsidized premiums in the marketplace.  The average subsidy we are seeing is about $2,800 a year.  On the high end, we have help many Hoosier in their early 60’s pick up subsidies for over $11,000 a year. The biggest subsidy I have seen so far is $15,900.  This has created a lot of premium joy for Indianapolis residents. They have had to make some difficult decisions on doctors though; the networks on the exchange plans are 40% smaller than what they use to be. In some areas there is no access to primary care doctors. There has been a lot of frustration getting these policies but now the process is getting a lot better.

Guaranteed Issue in the individual market has helped a lot people. When we look at policies off of the exchange, there is no more underwriting. This has increased premiums!  If you don’t qualify for a subsidized plan you may have premium shock.  Many young families in the area have been content with a $700 per month premium. That is no longer the case; these young families now are looking at $1,200 a month for a similar policy. On the plus side, the new policies have more coverage and cover maternity.

One of the key benefits to these new off-the-exchange policies is the traditional PPO network. Not all of the off the exchange policies have it but a few still do. So if you do not want to have to decide between doctors at medical facilities and would rather have the ability to go to almost any doctor, you still have this option.  The interesting thing is these traditional PPO plans cost about the same as narrow network plans.

Remember: there is an open enrollment season right now that ends on March 31 for both on and off the exchange plans. Get signed up now!

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