Author Anthony Nefouse

Agencies Postpone Claims and Appeals Enforcement

The Employee Benefits Security Administration (EBSA), U.S. Department of Health and Human Services (HHS), the U.S. Treasury Department,   Treasury Department agencies and the Labor Department have postpone the claims appeal process of the health care reform. They are stating they are having problems form a technical standpoint.  If you look at all of these agencies that are involved there is no wonder why they are having problems with this aspect of the new law.

The appeal process in a nut shell is the ability for an insured to appeal a claim that was declined in person with some type of board.  So an good example of this would be on experimental therapy. The insurance company could decline the claim because its considered experimental. With the new health care law anyone could appeal a denied claim and the law is suppose to set up the process for that appeal to happen.

Grandfather plans are exempt from the appeal process.

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Short Term Product Sales Discontinued in Indianapolis Effective April 1

“At Anthem Blue Cross and Blue Shield, we strive to provide the best coverage to our members, offering both stability and affordability through our individual health coverage plans.   We have made the strategic decision to discontinue the sale of short-term individual health insurance policies in Indianapolis effective April 1, 2011, as current premium rates are insufficient to adequately cover claims and other costs. ”

This news is not all that surprising. There has been major concerns with the carriers staying in the Individual markets because of the health care reform. The short term policy has become an option for a lot of people because of the reduced cost.

As we move forward through 2011 and it will be interesting to see if any other companies will also pull out of the short term market. With the Medical Loss Ratio there is a real fear of carriers pulling out of the individual health market all together.

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Insurance Exchange Input

Governor Mitch Daniels wants feedback on how the exchange should be set up.  You have to give the Governor credit because he is willing to ask the residents of Indianapolis what they want from their exchange.

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Defunding tactics

It looks like the House Republicans are working on a serious game plan to defund the health care reform laws. The one that I think would have the biggest impact on the law would be the grants for the state based exchanges. If the defunding occurred, it would make it difficult for the states to set up exchanges.  The exchanges are the essential aspect of the new law and how many people are going to buy their health insurance policy.

 

 

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Revision to health law  The president has allowed states the flexibility to tackle the health care law on their own as long as it reaches the goals of the federal government. This provision was already in the health care law but the president is moving it up 3 year so states can opt out in 2014. This might make it easier for states to file waivers.

A state’s waiver proposal must show that it is capable of providing coverage that is at least as comprehensive and affordable as that offered through new state-run health insurance exchanges, which also open in 2014. The state must also provide coverage to as many residents as the exchanges would have, and the proposal must not increase the federal deficit.
opt-out

The states and federal gov. might have a really difficult time make plans affordable with out subsidies. The law has done nothing to really address the cost of care and I think that is where the real problems starts.

When I wrote this yesterday I thought we might hear some positive things about the Revision. Well I was wrong. A Lack Of Flexibility  It looks like the Governors have determined that without flexibility in the law there is no way for the meet the unrealistic expectation of the reform. The federal Gov. might have some problems living up to their own expectations.

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Breastpump Publication 502

The IRS recently changed its position on breastfeeding supplies (including pumps and bottles) and deemed them deductible. However, the cost of infant formula remains nondeductible.

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PPACA has major  consequence to the employer group plans over 50 lives.

PPACA spawns a new form of wage discrimination I had to re post this blog posting because it show some unintended consequences of the reform.

Under the new law if a group over 50 lives has a group health insurance plan in place it is illegal for the employee to pay more than 8% of their house hold income towards health insurance premium. Sounds great right? Wrong!

So the if the avg health insurance premium is $20,000 in 2014 and there are two employees. One employee has a house hold income including benefits of $100,000 and the other one has a total of $30,000. The $100,000 employee will by law pay no more than $8,000 a year for health benefits and the employer picks up the additional $12,000. The other employee  making $30,000 total house hold income will only pay $2,400 leaving $17,600 on the employer.

If the employer decided to keep a health plan why would they hire lower wage workers?  Why would an employer want to be over 50 employee and face these kind of consequences?

There will be no mid size group health plans with these consequences.

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House panel sends 1099 tax reporting to the floor

This is a big aspect of the health care law when it comes to small business administration. This 1099 law is essentially a way for the gov. to collect more taxes to pay for the health care law. By law all small companies will have to file 1099 on services or products they receive. A good example would be a buying a printer. After  you purchase that printer you then will file a 1099 for the company you bought it from. So the 1099 are going to add up for the small business. This law will take valuable company resources to keep up with all of the 1099’s. Small companies do not have a lot of resources so to dedicate an employee or an office manager to this task takes a way from the core of the business.

All so noted in this repeal is the  tax subsidies.  “400 percent of the federal poverty level. Under the plan, consumers whose income increases to more than 400 percent within one year would have to repay their entire tax subsidies — a potentially significant hit of up to $12,000”  Right now if you fall into that 400%-500% of the federal poverty level you will be eligible for either tax subsidies or tax credits through the health insurance exchange. This new bill would state that if  you went over the 400% you would have to pay back the subsidy. I think $12,000 sounds about right for the subsidy.

For example, if a resident has coverage through the health insurance exchange and they get promoted to where their family no longer fall into the 400% category they will get hit very hard. Lets say a contract employee has a health insurance policy and they get a large job in one year that take them out of the subsidy level then they would also get hit hard.

This subsidy is a huge aspect to the health care reform law.   Here is the crazy part of this. HHS has not clarified if there will be a subsidy or tax credit.

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House Dem rips new insurance rule  Rep. Robert Andrews  (D-N.J.) spoke to the NAHU about the effects of the Medical Loss Ratio on Agents.

With the Medical Loss Ratio in the new health care law 80%-85% of premium has to go to claims. That leaves just 20% for the insurance company to spend on administration. HHS chose to include broker compensation in the administration. On large cases this does not have a  major impact but on the individual market it has been devastating. The carriers have cut the commission by 50% for individual health insurance throughout the country.  This new commission structure has forced many agents to reevaluate their individual health insurance sales.

Rep. Andrews is the first pro health care reform politician to address this issue in favor of the brokers and agents.   For many health insurance agents the new law devalues the services that we provide to the individual health markets.

Here at Nefouse & Associates we continue to proved the very highest level of services for all our individual health insurance customers.

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8941–dft Anthem just released a draft of tax form 8941. This is the tax credit for small business health insurance with less than 25 employees.  Most companies have had a difficult time qualifying for the tax credit.If you have less than 25 employees, average salary is under $50,000, and have an employer sponsored group health plan  you might quality.

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