Author Anthony Nefouse

Pharmacy Benefit Management News UnitedHealthcare PBM Optum, is launching a new program that should have a positive impact on UHC fully insured membership.
One of the biggest frustrations to insured individuals on health saving accounts (H.S.A) or high deductible plans, has been filling prescription drugs. On a H.S.A. plan, prescriptions will apply towards the deductible and members have seen little or no discount on filling those medications. The frustration comes when one using the many RX discount programs and they realize the savings vs. the health insurance company.

The cost of a drug may have a retail value of $220 and with the health insurance companies discount, the member may pay $200, but the third-party discount program brings the cost down to $80. Insured individuals on H.S.A programs have been extremely frustrated with this.

Most likely, the insurance company, pharmacy benefit manager or both have been retaining that discount. It’s extremely doubtful large companies like UHC, Anthem, Cigna, Express scripts have negotiated less favorable drug discounts over companies like GoodRX. In all probability the large companies have been retaining all of the manufactures discounts.

UnitedHealthcare would start sharing those pharmacy discounts with its full insured members starting 2019. This new program will impact over 7 million people currently insured with UHC. No longer will UHC member on high deductible plans have to use third party RX discount programs. UHC is also going to streamline cost transparency by providing members with access to true prescription drug pricing after the discount.

With the new drug discount program, members on H.S.A’s will see an immediate savings. What remains to be seen is what impact the savings will have on traditional copay plans.

Here’s an example: if the prescription falls on a $30 copay, the member would be responsible for that amount at the point of sale but what if the manufactures discount brings the actual cost of the drug below $30, the member should retain that savings.

The UHC new drug program may be viewed as being a preemptive move to future government regulation or a program to create brand loyalty.
As UHC new was released, there was more PBM news with Cigna buying Express Scripts for $52 Billion. Which is following trend with the other big health insurance companies. December of 2017, CVA agreed to by Aetna for $69 Billion. This mega merger may have started the trend of carriers finding value in owning their own PBM.

Indiana’s Anthem had stated that they were breaking away from Express Scripts and moving to CVS. After the CVS & Aetna buy out was released, now Anthem is building their own PBM called IngenioRX which is suppose to launch in 2020.

UHC already owns their PBM Optum RX. Aetna is going to be owned by CVS. Cigna is going to own Express Scripts and Anthem will build IngenioRX.
With UHC releasing their new RX member discount program, it will be very difficult for the other insurance companies not to follow suit. The mega mergers could lead to lower RX prices, now the drug manufactures are selling to PBM’s that have large amounts of healthcare data to back up price negotiations. The power of these companies to control prescription drug pricing would be huge. One would hope that the recent price increase of medications for no other reason than the manufacturer can would stop. The fear is the insurance companies with their PBM’s would retain all the Rx savings for themselves and ultimately the American people/businesses would be burden with cost.

We can only hope these companies practice the saying “With Great Power Comes Great Responsibility”.

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Indiana Challenging the Affordable Care Act

Indiana has joined 19 other states in a coalition to challenge the constitutionality of the Affordable Care Act (ACA).   The suit was filed in federal court in Texas and is led by Texas and Wisconsin.

December 2017 the tax bill was signed into law which eliminated the individual mandates financial penalties staring in 2019. Without the tax penalty, it is being argued that the ACA will fail.

The reality is the ACA has already failed from controlling health care cost and health insurance premiums. The ACA did accomplish one of it’s goals by expanding Medicaid coverage, where Indiana has seen HIP 2.0 go from 60 members to over 400K.

The Indiana health insurance market has transformed under the ACA. The Individual market has two insurance companies offering coverage. (Caresource & Ambetter) The medical community has already started to limit the amount of patient from these providers. This has caused serious disruption in care for Hoosiers in need of a high level of medical services.

We have witnessed most carriers withdraw from the Indiana individual and small group markets. Humana, UnitedHealthcare, IU, MDwise, Assurant, & Anthem have all exited the individual markets. These companies had large losses in the individual market and had challenges working with the government. Under the Obama administration, there was a huge reluctance to admit the ACA had any problems. There was also an inconsistency in the interpretations of the rules of the ACA. Under the Trump administration, it was made clear the failures of the ACA were beyond repair.

The ACA is already in a death spiral that is called adverse selection. The ACA failed to control the cost of care through multiple ideas like the Accountable Care Organizations (ACO). There was also a failure to deliver the original estimated amounts of members to the insurance pools. The unintended consequences of the Medicaid expansion, was one of the leading reason of lack of enrollments. Indiana is a perfect example, it was ordinally predict that we would have 900K Hoosiers insured through the marketplace. 2017 enrollment numbers, were less than 160K and to make matter worse, half of those members would drop off by mid-year. Medicaid & Chip membership is over 1.4 million for Indiana which has had a huge impact on market place enrollments. When Insurance companies developed products based on a pool of 900K and the reality was just 18% of that, it led to large insurance losses.

Unless you are receiving Medicaid benefits, the ACA has failed. It will be interesting to see if the law is overturned. If the law is not overturned, Indiana along with 20 other states, will see health insurance products that are offered that do not meet the requirements of the ACA.

Recently, we have seen the development of short term health insurance that offers a 12-month term. These policies do not meet that ACA requirements and can result in a tax penalty. Here is the reality, the short-term policy cost 65% less than an ACA policy. If your income is over the 400% of Federal Poverty Level and you don’t receive tax credits, on a family of four that could represent a saving of $10K a year. The tax penalty could be 2.5% of household income, which could result in a $9,000 penalty. If you are healthy and willing to take risk, this insurance solution could appeal to you.

For 2019, the tax penalty will be removed, there will be a huge migration to the short-term policy market. With no tax penalty, saving $10K will appeal to most middle-class families. This will have a huge negative impact on the ACA market because this will represent the low risk members exiting the marketing and will result in high premiums. (Adverse Selection). 2018 is really the last year for the ACA in the current form.

The small group health markets have also seen the development of group health plans outside of the ACA. These are the partially self-funded or full funded group health plans. These are plans that underwrite for ongoing health conditions. They have started to pick up tracking in 2018. This will have adverse impact on the small group ACA rates. Again, the good risk is leaving the pool.

The 20 states that are challenging the ACA may be correct in doing so. For the Hoosiers/employers that pay the full cost of the premiums, something must change, or this segment of the population will go uninsured. For the Hoosiers that are receiving Medicaid or assistance with health insurance, these programs need to continue. Otherwise this segment of the population will go uninsured.

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Employer Shared Responsibility Payment (ESRP)

If you are researching this topic, then you may have received a letter from the Department of Treasury Internal Revenue Service with regards to Employer Shared Responsibility Payment (ESRP).

Under the Affordable Care Act’s employer shared responsibility provisions, large companies are required to offer affordable health insurance coverage that meets the requirements of the ACA. This rule is also referred to at the employer mandate, which applies to companies with 50 full time employees or the full-time equivalence for the previous calendar year.

The employer shared responsibility penalty took effect in 2015, but there were multiple delays to give businesses time to comply.

An employer may be subject to ESRP, if one or more full time employees obtained a tax credit through a state or federal market place. The employee was eligible for the tax credit because the employer did not offer a group health plan, or the plan was deemed unaffordable. The IRS started to issue these letters the 4th quarter of 2017.
The letter states, under section 1411 of the ACA, that for at least one month of the year, one or more of your full-time employees was enrolled in an individual health plan that was eligible for tax credits or subsidies.
In the letter, it will state which employee/s had the tax-credit and for how many months. In that summary table, it will indicate the penalty.

At this point, take a deep a breath if you did offer a group health insurance plan. You have the right to appeal! One thing to keep in mind, during years 2015 & 2016, the marketplaces were slow to verify eligibility for tax credits. It was more like a “free for all” as the marketplace was unable to certify a employers group health plan meeting ACA requirements. Another issue was these were the first years some employers starting to file ACA reporting requirements. It is very possible that an employer or the firm they hired made an error on the filing. It’s also quite possible that the filing was missing information, so the ESRP is being sent as default letter.

Since these letters are just now starting to hit Indiana businesses and the rest of the country, it should be interesting how many appeals win.

One thing is for certain, the IRS is going to hold business accountable for employer shared responsibility tax.

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Amazon, Berkshire Hathaway & JPMorgan Healthcare TransformationThere have been huge shockwaves caused in the health care industry with news that Amazon, Berkshire Hathaway & JPMorgan would form an independent health care company for their employees in the United States.

Upon the release of this news, publicly traded health care companies saw their stocks prices drop as the news of new competition entering the health care marketplace has caused major speculation on how  these three behemoths’ will take on healthcare.

First between these three companies, there is over 1 million employees and potentially over 3 million people insured. This creates a huge advantage because the three behemoths have their own healthcare claims data. This information is impossible to obtain and they should have years of it along with the technology to analyze it.

With the recent news we are seeing speculations like integrated health records, personalized healthcare recommendations, medical provider reviews, and price transparency. All of these are great and have been around for 10+ years and may reduce costs by 5%.

Another speculation surrounding the news is that the three companies will band together and develop internal medical divisions that treat their employee populations. They recruit the best medical professionals, build facilities, and even develop their own pharmacy & pharmacy benefit manager (PBM). They could develop centers of excellence where complex treatments could be performed and managed more effectively than current options. They would have the ability to negotiate directly with pharmaceutical companies for lower pricing. Having their own pharmacies & PBM they could reduce RX costs significantly. This speculation would reduce health care cost for their employee and members. This strategy could be developed by a bunch “old guys” crunching numbers who all think alike.

What is the most “outside the box” speculation surrounding this news?

One extreme speculation is that Amazon, Berkshire Hathaway & JPMorgan merge to attack the very fundamentals of healthcare. Instead of practicing medicine, the develop process to match your genes with medical treatments. If your genes are known, then it can be determined what medications will work the best in your body. This technique is called ‘Pharmacogenomics’, which is defined as the study of how genes affect a person’s response to drugs.

If we were to take this a step further, if genetic testing can determine what disease an individual is at high risk for, a regiment of preventive care could be put in place to prevent that disease from ever occurring.

They could even work on developing Artificial intelligence (AI) to help diagnose medical conditions. If a video gaming council can have face recognition, why can’t a camera scan out tonsils and let us know if we have strep throat?

What if you have an integration between pharmacogenomics and prescription drug dispensing?

One of the biggest issues in pharmaceutical industry is the drug dose. If a drug is produced in 200mg but the data of 167mg is going to treat the patient most effectively, why not develop a compounding device that creates the exact dosage for the patient? There’s no telling how much time and resources would something like this save.

The current healthcare environment has been created by the industry players and government regulations. If the mission to completely overhaul the cost, effectiveness, and how we receive healthcare, will current industry leaders be involved with the strategic planning? Is it even possible to overhaul the healthcare system without those leaders being involved? Only time will tell.

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Outside of open enrollment there has been little news on the Affordable Care Act. On January 22nd it was announced that the Cadillac Tax will be postponed until 2022. The postponement was included in the short-term budget bill that was signed by the president.

This is a huge relief for Indiana and the rest of the country. The tax was set to become effective 2020, so this year was when most employers were going to start planning for the benefit tax. The problem with planning for the Cadillac Tax is there is little to no guidance currently.

What is the Cadillac Tax and what does it do?

The Cadillac Tax would assess a 40% penalty on the cost of employer sponsored health insurance. The tax would be on premium over $10,200 for single coverage or $27,500 for family coverage. For large Indiana employers that have self-funded plans, the tax could be assessed on what the Cobra rates are.

The fact the penalty has been delayed to 2022, is a huge relief and it could be anticipated that we will continue to see the postponement of this penalty.

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Group Health Insurance Indiana

We quickly approach Jan 1st, 2018, the state of health insurance in Indiana is nowhere near close to being stable.

Individual Health Insurance

The Affordable Care Act has failed every Hoosier that pays for or towards a health insurance policy. One segment of the population has benefited from the ACA, and that is the Medicaid Expansion (HIP2.0). HIP 2.0 members has swelled to over 500K Hoosiers. The marketplace did make it much easier to start the enrollment into Medicaid. Originally Indiana was projected to have 1 million residents that were buying health insurance coverage from the exchange. It was estimated we had 150K on the exchange in 2017. Estimated is the correct description because half of the membership would drop off mid-year.

Hoosiers who purchase coverage through the exchange will only have two carriers to choose from in 2018. (Ambetter & CareSource) Both of these companies have large Medicaid divisions. CareSource’s exchange network is about 20% larger than their Medicaid network. One of the frightening concerns that no one is talking about is the artificial specialist network. This is where they will list the same doctor multiple times under different addresses.

If you have traditionally purchased individual health insurance off the exchange, that is no longer an option. There will be no carriers offering off-exchange policies. The only option will be the two carriers offering coverage through the exchange.

If you live in an Indiana county that offers Ambetter, then that is the best of bad options. They will be offering a Health Saving Account plan. If you want to know why this is the best of the bad plans, contact us.

Group Health Insurance Indiana Plan Options

Indiana Small Group Health Plans
A small group in Indiana is less than 50 employees. If you currently have a small group health plan that is considered grandmother on Anthem’s legacy platform, it’s been a wild ride. 2018 your renewal date has most likely moved to Jan 1st. This is after four years of having the renewal date move moved every year. This grandmother block was not supposed to renew this year under the ACA, but the new administration decided to allow this business to continue. Which is good news for most small groups, but some are receiving big rate increases. The average rate increase is 13% but can go as high as 30%. This block of business is rated based off of claims. The last three years, these group plans have received low rate increase because the plans were all underwritten. Over time, claims do occur, and now it’s showing.

The fully insured group options you can count on one hand.
There are three carriers who offer small group coverage. Unitedhealthcare, Anthem, & IU. 2018 rates have increased with all three carriers. The average composite premium was already around $500 a month per employee; now they are closer to $600. This is getting very close to out of reach for most small group employers. Now a company has to get creative with not only plan design but with how the premium is rated. What to know an effective strategy? Contact us to learn more.

Level Funded Partially Self Funded
One group health option that has shown to be effective is using level funded health plans for small groups. These plans have underwriting, which creates significant savings if your employees and dependents are healthy. Premiums can be as low as $300 per employee per month. After underwriting the average premium is about 30% lower than the fully insured market. Indiana now has multiple carriers offering these options. Each carrier viewed risk differently, the best approach is to underwrite with all of them to get the best deal. The largest saving happens with there are multiple dependents being covered.

Large Group Coverage 50-99
The Large group allows for underwriting, and this is key to getting lower premiums. If the company has 50 eligible, then you can go to large group. For 2018, Anthem is counting part-time employees at full time, so that you can go to the underwritten market. This is a game changer for many Indiana companies. There are only a couple of companies competing in this segment. One thing that has come as a surprise, is the level funded carriers are not as competitive in this segment.

The President Executive Order
The new executive looks to be another failed attempt by Washington DC to help the current health insurance markets.

First, the ending of the government paying cost-sharing reductions. Most politicians and journalists have little understanding of the actual impacts of this. Cost Sharing Reduction (CSR) is where people making less than 250% of federal poverty level (FPL) would receive lower deductibles and out of pockets when they purchased health insurance through the exchange. The government was paying the difference directly to the insurance companies. Under the order, these payments will stop, but the health plans will still have CSR. So now the two insurance companies left in Indiana, will charge more in premium for those options. On the exchange, a qualified member will not pay more than 9.5% of income towards premiums. It will impact Hoosiers that don’t receive tax credits and want to purchase a silver level plan.

The second order has to do with increased flexibility with Health Reimbursement Accounts (HRA). The idea here is to give employees money on a tax-deferred basis so that they can purchase Individual plans. If there is no individual market, this has little impact in the short term.
The third is the creation of association plans or buying health plans across state lines. Currently, the carrier can sell across state lines but choose not to. There are multiple reasons why they don’t do this, but if state regulation along with federal mandates removed, this could create another individual market. With association plans, if they don’t have to abide by ERISA and ACA laws this could also open up different health insurance options. None of this would happen in 2018; it would take years for products to be created.

A recent two-year study revealed how much Indiana hospitals are charging for health care. The study used Medicare reimbursement rates as the benchmark. The study that received almost no consideration proved that Indiana hospitals are charging over 300% of Medicare rates. In 2018, hopefully, more attention is raised about what our medical community charges. There is a very quiet movement of using health insurance plans that reimburse based off of Medicare rates. The cost is significantly lower than using a network. The medical community is reluctant to accept these low reimbursement rates when they are used to getting 300% above Medicare.

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Group Health Insurance Indiana

When the Affordable Care Act (ACA) went active, a large a majority of Indiana small business dropped their group health plans and moved to the individual market. At first, this was an excellent option for reducing costs for both the company and the employee.

Businesses that had little employee turnover, no growth strategy, and lower compensation, have benefitted from dropping the group health plan. The main advantage came from tax credits from the marketplace.

Group Health Insurance Indiana 2018

We fast forward to 2018, tax credits are available, but the individual carriers left in Indiana have limited network access. These medical providers are built from the Medicaid system, and there have a been an exodus of providers that will no longer accept any marketplace plan.

Small group owners now realize that the individual options are no longer the best solution for their personal and business needs.

Small employers are now looking to set up new group health plans. Group Health insurance, allows the company to retain what key employees they have and allows the business owner to have access to all of the medical providers.

Attracting Employees with Group Health Insurance Indiana

A company that is not willing to offer group health insurance may not be able to attract employees, and a company is only as good as their employees.

For 2017 in Indiana, we have seen a lot of companies putting in 1st-year benefits or returning to offer a group health plan.

Some companies have tried to turn to the group health plan, but have problems with meeting participation. Most health insurance companies require 50% of the full-time employees to take the health plan. Employees that have lower compensation have benefited from tax credits and HIP 2.0 Expansion. It would cost these Hoosiers more money on a group plan vs. subsidized health insurance. Most small group employers will contribute towards the employee only portion, which can create financial hardship for the employee to pay for dependents.

There are some solutions to meeting participation; the first thing is if the employee is open to the idea. If they are then looking for subsidized coverage for the dependents. Another solution is offering multiple choices of health plans.

Small group, health insurance companies, have decreased in Indiana with the passing of the ACA. This may be a result of the guaranteed issue in the fully insured market.

Insurance companies that are offering small group health plans are Anthem, UnitedHealthcare, & IU health plans. When it comes to level-funded plans, where there is underwriting, Indiana has Starmark, All savers, National General, Lifestyle and a handful of other carriers.

Most of the level funded carriers have minimum employee requirement. With most of them, you need at least five employees to take the health plan. However, National General will accept just two employees. These can be great solutions for controlling cost. Since these plans are underwritten, insurance companies can offer lower premiums. This can create up to a 30% saving vs. the fully insured market. So there are options out there!

Contact Nefouse & Associates for your Group Health Insurance Indiana

If you are a small company, offering a group health plan may not be something you want to do, now you may have too. Contact us today to learn more.

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Group Health Insurance

Insurance companies in both Indiana and the rest of country have always enforced participation requirements. Small groups (under 50 employees) and “Large” groups (50+ employees) have had to have at least 50% of the full time employees elect coverage. Insurance companies do vary on employee participation.

Group Health Insurance for Small Groups

Fully insured small group carriers have not altered from the 50% rule. There is a provision in the ACA, which allows for companies to enroll in small group health insurance without meeting participation. This is only allowed for Jan.1st effective date.

Fully insured large group carriers do have different participation levels. Anthem requires the 50% of the employee to be eligible. Unitedhealthcare does not have a participation requirement in large group.

How can 2 companies have different participation requirements?

Broker assumption:

If a company in Indiana is considered large group, this means they go through underwriting for the group health plan. Anthem may be concerned with a level of adverse selection. Unitedhealthcare may feel that since they are underwriting the group, they are able to assess the amount of risk they are taking on. That assessment can lead to an increase in the health premium, which is an extremely effective tool for an insurance company.

Employee Class Carve out:

An effective technique to meeting participation, is carving out a class of employees for the health insurance plan. Example, a company with 40 employees and benefits are only being offered to management. Companies that have low income employees, have had a difficult time meeting participation because the low income employees can qualify for Medicaid benefits. This was true prior to the Medicaid expansion, now it is a major issue within certain industries. There are only a handful of insurance companies that will allow this technique.

Level Funded/Self-Funded participation:

The self-funded or partially self-funded insurance plans, have different participation requirements. Some carriers still require the 50% employee rule, then there are a few that will insure less than 50% as long as the waiving employees currently have qualified coverage. Qualified coverage waiver includes, Individual plan, Spouse group, VA, Medicaid, Medicare, or a parents plan. For small groups, that want to offer coverage to all of their employees, the level funded plan may be the best option. The group still has to go through the medical underwriting process but at least this option exists.

Employee Participation under the ACA

Since the Affordable Care Act (ACA) went into place, employer sponsored health insurance participation has been negatively impacted. The ACA created guaranteed issues in the individual health insurance market. Prior to the ACA, Indiana, the only way to get a guaranteed issued policy, was through a employer plan or Medicaid. Now employees were no longer “stuck” to their group health plan because of preexisting conditions. This allowed employees to go out to the individual market and shop for an alternative policy. For an employee or spouse, to take the time to research health insurance usually meant they felt they were paying too much on the employer plan. The other reason could be the out of pocket max on the employer plan. If a family knew they were going to have claims, they were able to purchase an individual policy with a lower out of pocket. Another reason is an employer composite rating. This is where the group health plan has the same employee cost for all the employee coverage. If the group was running rich benefits or had an older employee average age, the composite rate could have been much higher that what was being offered in the individual market. Medicaid expansion does have an impact on the group plan. Employees with families, are able to take advantage of Hip 2.0 & Hoosier Healthwise.

Companies all over Indiana and the rest of the country have had their participation rate impacted. In rural communities with lower average incomes, companies have been forced to drop their group health coverage. Blue collar industries with lower entry wage employees, have lost the 50% participation.

2018 Participation Predictions:

With the individual market imploding in Indiana and across the country, group participation will increase. Most employers have had lower costs because of a lack of employee participation. This is about to change in 2018 and I’m not sure all small and mid-size employers are preparing.

With individual plans not having network access, those Hoosiers are going to be looking for plans that keep access to their doctors. Group plans with either PPO or EPO networks, will give access which will lead to a huge increase in participation. This will also increase employer contributions.

Employee may be tired of dealing with the individual market and be happy with their employer making the health insurance decisions for them.

Employees Need to be Proactive With Group Health Plans

With this segment of the employees coming back to small or large group, employers need to be proactive. If this influx is younger employees, this may create an opportunity to lower the cost of the group coverage. If you are in the small group fully insured market, this average age decrease could reduce the premiums by as much as 30%. Unfortunately, this may not lead to lower overall employer cost but can help reduce the increase.

If a company has more than 20% of the employees waiving coverage, they should be concerned. The time to reevaluate the health plan, is prior to December 1st. Look at the employees that are currently waiving coverage, determine if it’s a spousal waiver or Individual. If the majority of the waivers are because of Individual coverage, you will be impacted. Once those individual plans end on December 31st, that is a qualified life event to join the group health plan. There is also discussion about forcing HIP 2.0 participants to work certain amount of hours a week. This could lead them to being qualified for a group health offering. Small and mid-size business, should budget a accordingly. Review the currently plan offering, look at making adjustments or even changing the plan offering completely.

If a company is facing a 30% increase in participation, this could open new options for health plans. Offering a dual option or even a multi option could create an effective strategy. If the company’s philosophy is offering a consumer driven health plan, the group may want to keep that philosophy, but add a lower costing health saving account.

If you have a company of 20 or more employees, it would be wise to look at the potential impact.

Here at Nefouse & Associates, Inc. we will provide the attention needed for you to make an informed decision.

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Indiana Health Insurance Company Updates

Recently, it was announced that Federated is leaving the group health market. They are exiting the state of Indiana and the rest of the country. They will end providing group health, life & disability on Dec. 31st of 2017.

“Federated does not see an end to the uncertainty surrounding the ACA” Federated said in a press release. This may sound familiar since most insurance companies have been using this type of language also when they announce they are exiting a market.

Federated provided group health insurance in the small group market. The majority of their clients appeared to be in “blue collar” industries. They also offered coverage in the property and casualty markets. Federated had the option of offering both liability and employee benefits to their clients. This did appeal to some Indiana companies and could have been a good solution.

Broker Assumptions:
The majority of their Indiana group health clients, may be on grand mothered or grand fathered policies. These would have been group plans, purchased prior to the affordable care act, which means they were purchased without having all the rules of the ACA. These plans had medical underwriting, which kept the premiums down vs ACA small group plans.

Federated may have been faced with multiple problems with their current business model. The individual market place, would had eroded membership. Small companies, especially in rural communities, took advantage of individual tax credits, which led to dropping group health. Another issue is the age of the group health members. A lot of Indiana small companies, blue collar, have an aging employee population. This can lead to a small group having a higher average age, which leads to higher premiums and the potential of higher claims. If the majority of their small groups fall in this category, they could have had issues with attracting lower risk groups. All of these assumptions, could be accurate, which means they could have been experiencing adverse selection. Without the ability to develop new small group health products, the decision to exit small group could have been made with math.

Impact to Indiana companies:
Federated group health insurance is good until the end of 2017. This gives you plenty of time to research the small group health insurance market. There are only a handful of insurance companies offering small group policies. It will not take much time to review the options. Most small group’s insurance proposals can be generated in less than 24 hours. Under the ACA, fully insured group plans do not have underwriting and no medical questions. The process of moving to a new small group plan is not difficult. Most Indiana group plans will have little to no disruption in medical services. With the move occurring at the first of the year, most deductibles will start over, so an employee will not be hurt by paying the deductible twice in one year. If the current plan is on a year plan, then there is a chance the member may be paying the deductible twice. In that situation, a group can request for a deductible carry over credit. The process of moving to a new group health plan, can be made easy, if you choose a brokerage like Nefouse & Associates. Click here to get in contact with us.

Assumptions from your Indiana Health Insurance Company

My assumptions, were formed from actual experience in the Indiana small group market. Working with blue collar companies and finding health insurance solutions.
Tony Nefouse

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Group Health Insurance Indianapolis – IU Health Updates

At the end of June, IU announced that they were leaving the individual market. There announcement was very quiet and received almost no media attention.

IU Health Plan is owned/an extension of Indiana University Health. The medical group has had insurance products available in Indiana. They offer group health for both small & large employers and Medicare Advantage for the senior market.

In 2014, they launched they’re under 65 Individual health plans as quietly as they announced their exit. It took them about a year to put together an effective distribution channel outside the market place. It also took time for IU to develop their message, that message was healthcare integration.

Healthcare Integration is where all your doctors are in communication with one another. If a member was being treated for an acute condition, this doctor communication would lead to better treatment outcomes and a better patient experience.

As a broker, the healthcare integration appealed to me. We enrolled a lot of Hoosiers in the IU health plans both on and off the exchange. The first 2 years, we had no clients that had complaints. They were either all healthy or the integrated care model was working.

2015 is when IU increased their individual membership. They ended up being penalized by the Affordable Care Act under risk adjustment. Their membership was healthier than they predicted. This was one of the reasons they choose to leave the marketplace in 2017.

Now, they have decided to exit the individual market completely in 2018. With Anthem exiting the market, this creates a huge unknown when it comes to risk. Regardless of the reasons why IU chose to leave the individual market, this is another blow to the Individual market in Indiana.

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