Author Anthony Nefouse

health-care-reformblogIs Health Care Reform just what the doctor ordered?

The Affordable Care Act includes many provisions designed to help consumers obtain health insurance either through the exchange or free market. The law is meant to give access to health insurance while at the same time control costs. Here are the key provisions that will impact all residents.

1. Extensions of health insurance coverage to children up to age 26.

While this was a very useful provision of the law, in 2014 these young adults will be able to purchase a policy through the exchange or outside the exchange with no underwriting. So a parent may actually be better off taking the adult child off their employer plan and purchasing a individual policy.

2. Guaranteed Issue requires all insurers to no longer be able to decline coverage based on health status.

This is one of the biggest provisions of the health care law. In the past, all health plans have been subject to some type of underwriting. In 2014, you will not have to answer any medical questions to get a health policy. For Hoosiers with ongoing conditions, this will have a huge positive impact.

3. Insurance Companies will be prohibited from charging consumers more for gender.

In the past, women have always had higher insurance rates. This will no longer be the case.

4. Elimination of annual and lifetime coverage limits.

Very few Hoosiers will be impacted by this provision unless you are obtaining a lot of health care. There have been situations in the past where people have maxed out plans, but this will no longer happen.

5. Prohibition of Coverage limitation or exclusions based on Pre-Existing Conditions.

In the past, we have seen Insurance companies place riders on certain conditions or put a waiting period in before the condition would be covered. Now any on going condition will covered under the policy.

6. Approved clinical trials have to be covered by the insurance policy.

This is a huge provision! In the past, an insurance policy would never cover any clinical trials. Now they do. So if you have a terminal condition, you can participate in a clinical trial.

7. The Medical Loss Ratio.

80% of  your premium dollars must go towards medical claims. If a portion of the 80% does not go towards medical, then you could be eligible for a rebate.


These new provisions will have a huge impact on the entire state. Some people will be very happy because they will now have access to coverage. Others are going to be upset because they will see their premium go up.

In any case, there are going to be options for coverage. You will be able to look at a policy through the health insurance exchange and outside the exchange. Inside the exchange, you’ll have the option of applying for subsidies to help lower your costs. Outside of the exchange, you’ll have the option of the free market, where you can purchase a plan that has greater access to doctors.

Need help sorting it all out? Contact us and we can help find the best plan option for you!



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health-insurance-exchangesExchange, no exchange, where will you be getting your health insurance?

Right now, most of the national carriers have decided to have limited participation inside the health insurance exchange. In Indianapolis’s Health Insurance Exchange, we are only seeing four carriers that have submitted plans to participate inside the exchange. The only carrier that will be selling exchange plans through the entire state Anthem. So what does this mean?

This national carriers are hedging their risk to offer plans outside the exchange.

The carriers think that people who have household incomes around 400% of the federal poverty level will not want an exchange plan. Why? Well there are a lot of reasons why someone would choose to purchase a health plan outside the exchange, such as:

  1. The subsidy isn’t enough. A family may find a plan that is priced at the same level of premium after the subsidy is applied.
  2. Plan design. Many Hoosiers are accustomed to having the freedom to design a plan that best fits their needs.
  3. Network! This may be the biggest determining factor of why someone buys a policy from the exchange. All of the exchange plans look to be on an HMO network. HMOs are more restrictive than what most Hoosiers are used to and want. It will be very difficult for some parents to have to switch their pediatricians for their children; most people take the time to find doctors that they trust and won’t be willing to switch. The plans off the exchange should have the freedom of the PPO networks.
  4. Accessibility to doctors. There is some concern that the exchange plans could create a longer wait time to see a doctor. On a plan outside the exchange, you may have a much speedier response from your medical providers.


The plans offered outside of the exchange will have a guaranteed issue, which means no medical underwriting.  The application for these plans has been filed to the Department of Insurance and they look surprising simple to complete.  In the next few months, we should know the pricing for these plans offered outside of the exchange in Indianapolis.



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insurance-300x291The new health insurance plans for the Federal Facilitated Exchange have been submitted to the Indianapolis Department of Insurance. Once the IDOI approves them, they will need approval from the Federal Government. Indianapolis is fortunate that you can pull the plan designs from the IDOI website. So what are the plan designs looking like?

The plan designs are all coming in with narrow networks. I would even go a step further with the plans being filed as Health Maintenance Organizations (HMO). The plans are stating that if you do not choose a primary care physician (PCP), then one will be appointed to you. All of your health care must go through that doctor. If you see another doctor without the referral of your PCP, then the claim in not covered. The is no coverage for out-of-network services.

By law, if you have an emergency room visit, it has to be covered as a in-network charge. Some of the plans are stating that a claim must be received in 30 days to eligible for coverage.  This could be a huge problem for some Hoosiers that are not aware of the contracting.

So far, there have only been four carriers to submit plans for the Indianapolis exchange. Two of them are insurance companies and the other two are Medicaid-type providers.  So the plans are looking like Medicaid-type plans with cost-sharing to the insured. Depending on the kind of plan design you choose, deductibles are anywhere from $0-$6,350, co-pays are anywhere for $0-$50 along with co-insurance and Rx co-pays start at $10.

Rates have not been released yet on these plans. With the narrow networks and cost-sharing, it will be very interesting to see how much these plans cost.  It is starting to look like the only reason you would take one of these plans is because subsidies are being offered. If this is all sounding confusing, you can contact us to help you pick the right plan!



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00_HC_shutterstock_117506374_HealthCare_RisingInsuranceRates_3Recently, there have been publications saying that health insurance rates are going up 72% under Obamacare. For example, here is a story in the Indy Star which explains the that under the mandate, everyone must be covered, including those with pre-existing conditions. If this turns out to be true, it will be quite a shock to the wallets of Hoosiers across the state.

The industry really does not know if these statements are accurate. For one thing, all of the health plans have yet to be approved by the state, so we won’t know anything for certain until a later date. Forbes published a piece contradicting the information about the 72% rate increase and we think there might be some truth to it.

The individual health insurance market is going to go up, but the question is how much? As consumers, you will still have options between the four tiers of health insurance plans. When taking a look at the projections for how much insurance rates will increase, the projections you read about are averaged between all four tiers. Those tiers have significant differences, so it is unfair to group someone with a bronze plan in with someone with a gold plan.

Also, subsidies will be offered through the Federal Exchange to  many Hoosiers.  This will have a huge impact on monthly premiums, lowering the cost for many of our residents. As for group health insurance rates, we are hearing about rate increases of just 8%. If that turns out to be true, then that could be a good thing in the fully-insured market.

Until October comes, no one can say with 100% accuracy what will happen. But once the official rates are released, all of this uncertainty will disappear and we’ll know exactly what to expect for 2014.



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smokers_life_insurance_quotesAre delays become the norm for health care reform?

A glitch in the health care reform law might be giving smokers a break from tobacco-use penalties which would cause their premiums to become too expensive.

The Obama administration has informed health insurers that there is a problem in the computer system  that will limit the penalties the insurers can charge smokers, and it will take at least a year to fix the issue. This does not impact the opening of marketplaces on October 1 though.

Before the glitch, it would have been possible to charge a 65 year-old smoker more than three times the premium of a 21 year-old smoker, but now if an insurer tries to charge more, the submission will be rejected by the system.

While the health care reform law requires insurance companies to accept all applicants regardless of pre-existing conditions, it does allow them to charge smokers up to 50% higher premiums as a way to ward off bad risks.

Are you wondering what that means for older smokers? For example, let’s say the premium for a standard silver insurance plan was $9,000 per year for a 64 year-old non-smoker. For a smoker of the same age, the premium could be $13,600, and the smoker could not use any available tax credits to help pay the premium and offset the smoking penalty.

What do you think about penalizing smokers in health care reform?

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6093699369_a6fa0338d7_oUsually, I don’t like to use the term “Obamacare” but it seems that most Hoosiers know of the Affordable Care Act by that terminology.

Right now, Health Care Reform looks like it is starting to unravel. The announcement of the delay in the employer mandate raised concerns. On one side, it looks like the administration is scrambling with the implementation of the law. On the other side, the administration is starting to realize the negative impact that the mandate is going to have.  The administration has had ample time not only for putting the law in place but to understand the full effects of the law.

When we look at the Health Care Reform law, we see that it is based on concepts. These concepts may or may not work in the real world. The center piece of this law is the development of the exchanges.  We are starting to see what these exchanges are going to look like, and they look similar to Medicaid policies. There are going to be HMO lookalike networks. On the positive side, the premiums are going to be subsidized by the federal government.

The real life issue issue is this: will enough healthy people sign up?

It has now been proven that healthy people will pay higher premiums. This is a tough situation. Most people in their 20’s usually go without health insurance unless offered and paid for 100% by their employer.  If we don’t get enough young healthy people to sign up for coverage, then the exchange will have adverse impacts or a downward spiral to death.  This is a situation that would happen if only sick people take out coverage and their high claims increase premiums for everyone else. This is the main reason we are not seeing more carriers participate in the exchanges.

In the next year, we will see fully insured health premiums increase anywhere from 30%-50%. This is because the law mandates a high level of coverage. Lower deductibles, out of pockets and the essential health benefits will all add to the increase. Then add another 3.5%-7% in taxes on the premiums.  We will see Indianapolis small businesses make decisions that are based upon these increases. It’s predicted that a lot of small business will drop their group health insurance and send the employees into the individual market. The other option is that the company may choose to self-fund their health plan. The company would then take on a calculated risk of paying their own claims up to a stop loss limit.   No matter what, a tough decision will have to be made.

When we look at Medicaid, only half of the people that are eligible take the plan. Here is a situation in which people get free health insurance but don’t take it. This shows a possible flaw in the Obamacare approach. Even with artificial markets being created inside the exchanges, people still may not participate. The exchanges then turn into a high risk pool with a expiring shelf life. That is when we will have to deal with all the unintended consequences of the law.

What are your thoughts about “Obamacare” and the impact it will have on our society?




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WideModern_healthinsurance_130703620x413One of the main points of the health insurance reform law was the employer mandate.

The Employer Mandate is a requirement for companies with over (or the equivalent of) 50 full time employees to provide group health insurance. If the group does not provide health insurance, they would pay a $2,000 penalty per full time employee. If the employer offered a group health plan that did not meet the requirements of the new law, then the company could be penalized $3,000 per employee.

Under the employer mandate, if an employee works more than 30 hours a week, then the employer must provide health benefits or pay a $2,000 penalty. This has been a huge nightmare for Indianapolis corporations.  There are a lot of local based companies that have a higher hour requirement than 30 hours a week to be eligible for benefits. We have seen a lot of companies move employees that were over 30 hours a week to below the 30 hour mark. Essentially, there has been a trend of pushing employees to part time status so that companies can stay in business.  We have seen multiple industries forced to make difficult decisions based on the employer mandate.

It’s difficult for policy makers to understand the true cost of insuring employees. In a lot of self-funded cases, it’s not about the premium, but it’s about the claims. There are also a lot of industries that have had a difficult time sponsoring a group health plan because of cost and participation.  The employee can’t afford to pay the premiums and the employer’s business model does not include a benefit package.

The employer mandate would have a negative impact for all of these industries. The frustrating part about this is the current administration has down played these issues since the inception of the law. The fact that they have finally looked at possible impacts is a good start.





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Screen Shot 2012-11-27 at 4.40.23 PM-resized-600One of the key aspects of the new health care law is the Adjusted Community Rating.

Currently, the health insurance industry uses gender, medical history, group size, and health status. These underwriting practices will be prohibited in 2014. With the new law, health insurers in the individual and small group markets will only be able to adjust premiums by family size, geography, tobacco use and age.

Premium ratings for age will be limited to three to one. This limits the amount an older individual will pay to no more than three times what a younger individual pays in premium dollars. Tobacco users, on the other hand, could see an increase in premiums up to 50%.

With these changes, it is projected that many small businesses and individual products will have substantial rate increases.

A small group that is young and healthy will see a large increase to offset the older and high-utilizing groups, where the high-utilizing groups may see only small increases. The individual market will experience vary large rates increase because there will no longer be underwriting.

So how do we offset these rate increases?

If you are have no access to a group plan, then applying for coverage through the exchange may reduce costs. The Indianapolis Federal Facilitated Exchange will have tax credits that can help reduce your monthly premiums if you qualify.

Many small companies may have tougher decisions. Small companies will be faced with 30-50% increases in group health insurance costs.  One option would be to look at the exchange for a possible tax credit on the group side. Another option would be a self-funded small group plan.

The third option would be to look at a defined contribution approach, in which an employer can determine up-front how much to contribute to the employees’ health insurance. This offers employees more choices and better choices than they currently have. Employees would no longer be limited to their employer’s “one size fits all” insurance choice.

Have more questions? You can contact us here and we can help get the right plan for you!






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medical_mutualMedical Mutual of Ohio has decided to exit the Indianapolis market for group and individual health insurance.

This is a real blow to competition in the small group and individual health insurance market. Medical Mutual was a good carrier in the small group market, which gave a nice level of competition  to the national carriers. They had plans designed that were not only unique but saved small groups money.

From an administrative standpoint, they were also very easy to deal with. They had launched their own network in Indianapolis, which started to get deep network penetration.  All in all, Medical Mutual was a good alternative small group health insurance carrier.

They have stopped taking new business as of July 1st. All individual policies will end December 31st 2013 and all group health plans will end June 30th 2014. If you have an existing policy with Medical Mutual it will be business as usual. There should be no disruption in claims or administration.

If you have an individual policy with them, it may be time to start looking to move that policy. On the group side, waiting until your renewal date may be the best option. If you are not comfortable with that, then we can move you now.

Why has Medical Mutual pulled out of the Indianapolis market?

This is a decision made due to Health Care Reform under the Affordable Care Act.  The smaller health insurance companies are scrambling because they don’t know what is going to happen in 2014.  Under the ACA, there will no longer be underwriting, which insurance companies have used as a way to control risk since the inception of insurance. Under the new law, underwriting is taken out of the equation.

There are also some real concerns that the small group health insurance market will drop off. With guaranteed issue in the Individual market along with Federal Subsidies inside the exchange, many small companies may choose to drop coverage.  It may also be a decision they are forced to make because of cost increases.  We may see small group health insurance rates spike up to 50%. Very few employers will be able to absorb that kind of price increase.

The new health care laws are suppose to increase competition! As a broker, we are seeing the exact opposite. The bottom line is you still want to find the best policy in 2014. It may come from inside or outside the exchange. You may look to a fully insured health plan or a self funded group health plan. If you need help finding a plan, contact us to find the best solution for you!







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link-exchange-placeWe’re less than 100 days away from the Indianapolis Federal Facilitated Exchange opening.

There are two very big things that need to happen before October for the exchanges to be fully operational.  The first one is from a technical standpoint; the government still needs to complete the infrastructure of the exchange. This will enable government agencies to transmit information between one another to see if one is eligible for subsidies. This is an enormous task because  Health and Human Services, Treasury, Homeland Security and other agencies will have to communicate with one another, and this has never happened before.

The next technical aspect is to finish the online portal for the Federal Exchange which will be operating in Indiana and many other states.

Let’s say that all of these technology issues are solved and tested. The next big issue is going to be outreach. Most have no idea how the exchanges are going to work.  Currently there are very few brokers that are touting the benefits of the exchange for Hoosiers. Luckily, we are!

It’s our belief that  many Hoosier families will benefit from the subsidies offered in the federal exchange. Contact us today to be prepared for Health Care Reform.


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