Category Explanations

President Biden officially signed into law H.R 1319 aka American Rescue Plan Act of 2021 on March 11, 2021.   One of the goals of the law is to expand Health Insurance by making it more affordable.

Marketplace Tax Credits Expansion on Health Insurance

Under the new law, people that purchase individual and family Health Insurance through the federal marketplace could see their monthly premiums drop.

Currently to be eligible for the tax credit aka premiums assistance household income has to be under 400% of the federal poverty level.   Under the new law, the 400% requirement is being lifted. It’s not clear what the income cap is going to be or if there is going to be an income cap.  

Currently, those that qualify for premium assistance pay no more than 9.83% of their household income towards premiums.   Now qualify subsidies recipients will not pay more than 8.5% towards Health Insurance premiums.   Those making less than 400% of the FPL could pay as low as 2% of their income for the Individual health insurance policy. 

Health Insurance Premium

If there is indeed no cap in household income for premium assistance, we could see a huge migration to the individual market.   Small groups with less than 20 employees could see participation drop off.

COBRA

Under H.R. 1319 the government will fully subsidize 100% of COBRA premiums for those employees that were laid off, furloughed, or had a reduction in hours.   This should allow any employee that qualifies to continue the group health to keep that coverage in place with no cost to them.  In fact, the subsidized cobra premium may be lower than what they were contributing as a full-time employee.   Employees that leave employee voluntarily are not eligible for the premium assistance.  This benefit will expire in September of 2021.  

The American Rescue Plan is going to have a huge impact on the individual Health Insurance markets.  We will see a large portion of individuals that have purchased a short-term, med share, & indemnity policies return to the exchanges because now they will qualify for premium assistance. 

Small employers with less than 10 employees that are offering group health plans may be forced to drop coverage because of participation issues.

As always, Nefouse & Associates is in a position to provide our client with the best Health Insurance options.

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The Covid-19 pandemic has changed everything in our society, and now we could see job classes change for all size companies.  Through the pandemic, it has been proven employees can be productive working remotely and, in some cases, more productive. We are seeing different employee class terminology being thrown around by tech companies:

Flex employee- This class of employees comes onsite maybe a couple of times a week.
Fully Remote- Just like it sounds, this class does not visit corporate headquarters.
Office-Based- Traditional workforce that comes into the office every day. It predicted this would be the smallest class of employees in the future.

What impact will the new work classes have on Insurance Benefits?

Large Corporations:

Most large company’s HR departments are already well versed in recruiting remote employees. They are in tune with their current insurance offerings, especially if their health benefits have a national provider network. The national provider network is critical when determining if that remote employee will have access to their local medical providers.  

They also have the resources in place to understand different state laws that impact them hiring remotely.  

Medium-Sized Companies:

Companies with under 500 employees may find obstacles when most of their employees become remote. These companies will have to evaluate their current group health insurance to see if they offer national networks with adequate network access for remote employees.  They will also have to analyze their network access fees and determine if they are paying too much to use that network.   There will be multiple areas that HR and CFO’s may have to look at that in the past were nonissues.  The state compliance piece could create additional administration responsibilities; otherwise, they have not had to address.

Small Companies

Companies under 200 lives with limited resources for HR will find themselves leaning heavily on their advisors for guidance.  HMO networks’ re-emergence with attractive cost savings and integrated care models may not work for remote employees.  Small groups may be forced to consider outside of the box options for remote employees.  The new Health Reimbursement Accounts could play a role in providing a tax-free benefit to out of state employees.   Small companies are going to have to adopt a digital onboarding system. The day’s of sending paper PDF’s of Insurance Benefits is not going to give an out of state/remote employee the best second impression of their new employer.  Small groups should consider a customized benefit admin system that a new hire can log into from a mobile device whenever they want and view plans and cost before making plan selections.  If you are going to recruit remote employees, having a benefits admin platform is essential. We see groups give the prospective employee access to the benefits offering prior to them deciding to accept the position.

Insurance Industry:

The insurance industry is going to have to adjust to the future employee classes. One of the first things is they will have to change requirements in their insurance contracts of x % of employees being domiciled in the home state, which is common with fully insured contracts—developing plans that address multiple out of state pharmacies being in the network.  We could see what was once considered a radical approach of all mail order being the norm. 

The Increase network provider will continue to be an important aspect of every insurance contract, especially if we see a shift to remote employees living in rural communities.  The Insurance companies will also have to change the tax documents that use to prove an employee and employer relationship (Wage N Tax).  Every state has different filing requirements.

How is Nefouse & Associates Inc Adjusting?

We have been handling clients that have been engaged in hiring remote employees for over two decades. In the last five years, the remote employee has become more than just a trend.  We have had to address these issues and additional for our clients as they have had to engage in remote hiring.

With the prediction that most employees could be remote, this could create a huge obstacle for small companies who now must quickly change and adapt to this new environment.  These issues are not new, but they may become new for many small Indiana employers who must change their company culture.  Some companies may not be ready to address these challenges on their own.

Recently a wise and successful entrepreneur said, In the past, we have had to reinvent ourselves every seven years, now it’s every three years. This new employee class may be an area where employers must reinvent themselves.

We can help you with your Insurance Benefits!

 

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The 2021 Individual Health Insurance open enrollment is in full swing.  Originally started on November 1st and will end on December 15th, 2021. Don’t wait until the last minute to finalize your enrollment. History has shown that the marketplace will have problems in the last couple of days of open enrollment due to high volume.

With us being at the halfway point of the open enrollment, most of the glitches have been worked out on the marketplace and the insurance companies.  Some of the problems have been with the networks not showing correct participating providers. It’s always a good idea to call your physician’s off to confirm if they are participating in one of the Indiana individual networks.

The Individual health insurance options for Indiana.

On the exchange aka marketplace aka Federal Facilitated Exchange aka healthcare.gov

We have CareSource and Ambetter offering coverage in all Indiana counties and Anthem is offer coverage in a few counties.

CareSource has the lowest costing plans. Ambetter has a larger network.

If your household income is under 400% of the federal poverty level, you could qualify for premium assistance.   If you are eligible, then the health insurance policy may only cost you about 9% of your income. If you are under 200% of the poverty level, then you may qualify for HIP 2.0 through the state.

Off-Exchange AKA outside of Obamacare

Anthem is offering an individual policy that is about 30% less than the marketplace. This policy does require medical underwriting to get approved but does cover preexisting conditions.

Ambetter- Is offering an off-exchange policy for the entire state of Indiana.  Little bit different plan designs, and the premium is less than on exchange offerings.

Short term policies- these are 60% less than marketplace plans but are medically underwritten. These plans do not cover preexisting conditions but can be the right solution for healthy Hoosiers.

Indiana is slowly starting to get more Individual Health Insurance options. If you qualify for premium assistance, then on the exchange is going to be the best option.

If you are healthy and do not qualify for premium assistance, then off-exchange may work from a cost standpoint. Once we can determine if on or off the exchange will work for you, then we narrow down the plan options. 

Contact us, and we will help you.

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The health insurance industry has been responding as fast as they can to the treatment of COVID-19. This started as a health crisis and has now turned into a financial crisis.

The health insurance industry has made multiple changes concerning COVID-19.

Testing

With most health insurance companies, there is not member cost for being tested for the virus.
This included video medicine and telemedicine, as the industry is steering initial treatment to these resources in an attempt to limit exposure to the virus. Here is an Anthem resource on finding locations for testing.

https://www.anthem.com/microsites/covid19-assessment/covid-finder.html

Treatment

Most health insurance companies are waving member cost for the treatment of COVID-19. This includes waiving co-pays, deductibles, and coinsurance. The insurance carrier will list types of services that are covered at no cost.

Prior Authorization

Most insurance companies have modified their requirements for prior authorization with a diagnosis of COVID-19. This does include pharmacy benefits.

With most elective surgeries being postponed because of the virus, your authorization may only be suitable for 90 days.

Prescription Drug

Most carriers are allowing a member to early refill their medication to make sure patients do not have a disruption in treatment.

Group Health Insurance eligibility

Most insurance companies have relaxed eligibility requirements to remain on the group health plan.

Insurance Companies response:

Most of the large insurance companies are working with government entities and providing information into the treatment of COVID-19. What’s the time after diagnosis to being admitted into the hospital? Length of stay in the hospital.

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1st what is the coronavirus?

Coronavirus is a type of virus that causes a respiratory infection in the lungs and airways. It is part of the same family as the virus, which includes the common cold.

2nd What are the symptoms?

Symptoms include fever, cough, and shortness of breath, which can be mild to severe—appearing 2-14 days after infection.

3rd How does the virus Spread?

Experts think the virus is spreading through person to person contact—a cough, sneeze or kissing. With COVID -19 being a new “disease,” experts around the globe are racing to learn more.

4th Prevention

The best way to prevent infection is to avoid exposure to the virus. Here is a link to the  https://www.cdc.gov/coronavirus/index.html   Centers for Disease Control and Prevention.

Wash Hands for 20 seconds, after going to the bathroom, before you eat, after a cough, sneeze, & blowing your nose.

How Health Insurance benefits could work

The insurance companies should cover Individuals if they get diagnosed with COVIDD-19. This treatment will most likely go towards your deductible and out of pocket max. There is the chance the government/state could mandate treatment covered at no cost to the member.

How much will the COVID-19 test cost?

There are a lot of rumors floating around that a test could cost $3,000+. These rumors could be based on emergency rooms testing for 22 upper respiratory pathogens. It’s been reported that the CDC isn’t charging patients to tested according to American Health Insurance Plans (AHIP), which is a health insurance trade association.   

COVID -19 Impact on Mediation Supply Change:

One serious impact of the COVID-19 virus is a disruption to medication being produced in China. Many of our drugs are manufactured in China. It is possible the importation of these drugs could be delayed. The health insurance company you are insured with or the pharmacy benefit manager will contact you if there is a shortage of medicine that you are currently treated with. They will make a recommendation of other medications in the same therapeutic category that can treat you.

Medications to treat COVID-19

Currently, there are no prescriptions or vaccinations that are approved to treat the virus. Experts are working on developing treatment plans along with vaccines.

Health Insurance companies in the event of Pandemic:

Right now, each insurance company is reviewing and amending its plan to supporting operations in the case of Pandemic from COVID-19. Companies are already starting to halt travel and initiate work from home operations. Attention to making sure critical business processes are met to meeting customer’s needs.

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On 6/24/19, the President of the United States issues an executive order requiring Hospitals and Insurance companies to reveal what they are charging or paying for services.

The idea is to make health care cost transparent, which then would lead to consumerism and then medical providers reducing costs to attract more patients. Primarily pressuring the health care industry to become like any other industry.  “The goal is to create a more competitive marketplace where providers are competing for patients on price and quality.” CMS

The Insurance industry immediately pushed back, stating this action would have unintended consequences by pushing prices higher rather than down.  The insurance industry fears that publicly disclosing proprietary network rates (PPO, EPO, HMO) will only lead to medical providers demanding higher reimbursements based on the highest reimbursement rate.

The Department of Health and Human Services will propose regulations requiring hospitals to disclose what the standard charge for medical procedures in an easy to understand format. 

Both, which includes Insurance companies and medical providers will fight this executive order with all their resources because real price transparency could have huge implications on their business models.

If the public can retrieve what each medical provider charges for a specific procedure, that could lead to that patient going to the lowest costing provider, especially with current deductibles and out of pocket maxes.   Quality care should remain a factor, but a provider charging more for that procedure would have to justify why they are charging more. Maybe they have the best doctor in the state performing that procedure, or they have the newest technology, or it might come down to how the staff treats you before and after the procedure.  Price transparency could lead to lower prices and additional services.  

On the flip side If all the medical providers know what each other are charging, this could lead to higher prices by matching the highest price being charged.  

If the public had access to network discounts that the insurance companies negotiate with the medical provider are, it could have a massive impact on carrier selection.  Large employers with self-funded plans would have a clear picture on which insurance company offers the deepest discounts. A large employer typically will be responsible for the initial claims on each member called stop-loss insurance.   If the employer pays the first $150K in claims on each member and they have a crystal-clear picture that Insurance company X has 10% deeper discount than other carriers that can add up to significant savings.

On the flip side, all the insurance companies could arrive at a similar benchmark on reimbursements and then negotiate additional discounts that could go back to the carrier or client in the form of rebates. Thus, losing transparency

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Indiana was one of six states to file a lawsuit against the Affordable Care Act’s health insurance provider fee (HIPF) for State Medicaid plans.

The U.S. District Judge ruled in favor of the plaintiffs, Texas, Indiana, Kansas, Louisiana, Wisconsin & Nebraska’s that the government must pay back $840 Million in Obamacare fees.

What is the Health Insurance Provider Fee?

The HIPF is an annual fee charged to health insurance companies on health insurance premiums. The Patient Protection and Affordable Care Act of 2010 assesses fees on insurance companies that provide fully insured health insurance coverage. 

The fully insured tax/fee is 3% of the total health insurance premium.

Business affected:

  • Individual and small group health insurance plans.
  • Large Group Health plans.
  • Stand- alone, dental & vision plans.
  • Stand-alone, behavioral health, and pharmacy plans.
  • Medicare Advantage plans.
  • Retiree-only plans.
  • Medicare part D prescription plans
  • Taft-Hartley Plans
  • Medicaid and Children’s Health Insurance programs (CHIP). Until recent court ruling!

The purpose of the tax/fee is to help fund federal and start marketplaces/exchange.

The estimated cost is $14 billion a year.

The authors of the ACA & PRACA projected that there was going to be enormous profits for the insurance industry because of the Individual Mandate. Thus, they could tax the industry to fund the law. They also assumed that these profits would create carrier competition.

The reality is the insurance industry passed this cost on to the members, which has led to everyone paying about 3% more to fund health care reform.

The fact that Medicaid plan is now exempt from the ACA tax is a massive blow to the ACA and the funding mechanism.  Indiana alone has over 2 million people on Medicaid, and it’s not clear the government can make up for this loss of funding for the ACA.  $840 Million is a year is just a start, other states will follow and with an estimate of $5.5 billion attributed to the Medicaid tax. 

This is a massive blow to the ACA law, that is has gotten almost no attention!   The funding of Obamacare may have just lost 25% of its funding.  This estimated operating costs for the marketplace is $2.1 billion.

It will be interesting to see if the government adjusts the federally facilitated marketplace. There could be a decision to turn those operations over to a third party. 

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Short Term Health Insurance Final Rule 36 months of coverage

Short-term health insurance is a policy that is very similar to pre-affordable care act coverage.  The plan does not cover preexisting conditions and requires underwriting.  If your accepted, the cost is 50%-60% less than an ACA product. These plans are also using traditional PPO networks, which gives greater access to medical providers.

The final rule allows for short-term coverage to be extended up to 36 months. Currently, coverage can be offered up to 90 days.  This could be a game changer in the current individual health insurance markets.  Even though the final rule states a plan can be offered for 36 months, does not mean that all insurance companies will embrace this. We could see contracts that are guaranteed renewable for 36 months.

There is much criticism that these short-term plans will negatively impact the ACA marketplace. That criticism is valid because if someone is healthy and can obtain a 36-month policy for 50% less, that will be very attractive. Then the ACA pools will lose a portion of the healthy members that help to offset higher utilizers. Thus ACA rates will increase.

Why did the Administration Extend Short Term Plans?

Currently in Indiana and the rest of the country, if you are not eligible for tax credits/subsidies on the marketplace, the premiums are astronomically for most middle-class families.  Then add in the limited network access with huge out of pocket maxes, it’s not uncommon for a family to have $17,000 in premium with potentially another $14,000 in out of pocket, that could cost a family $30K a year.

That same family looks at the short term for $7,000 a year with the same out of pocket, given the short term does not provide the same level of coverage or covers pre-existing conditions. If a family is healthy, it’s hard not to entertain the short-term option.   That is why the administration extended short-term plans.

Short-term plans are underwritten which is where you have to answer medical questions and can be denied the plan.  Most of these policies are now enrolled through web-based applications, which makes for easy enrollment. The insurance companies use a technique called Post Claim Underwriting when you have a claim.  This where the insurance reviews your past medical history to determine if the claim was preexisting. If it is a prior condition, the insurance company can and will deny the claim.  One of the real problems with Post-claim underwriting is the delay of payment to the medical provider.  The insurance company may request all your medical records for the past five years.  Even if you are persistent most medical provider will take at least a month to release records.  If you get diagnosed with the condition that needs immediate treatment, the delay in payment could prevent an obstacle to continuing treatment.

In 2018, short-term insurance sales exploded in Indiana and the rest of the country. Smaller insurance companies got creative with their product offering. To be compliant with the rules set by the Obama administration, short-term was only good for 90 days, and companies created 3×4 policies that included 4 short-term policies with one application.  These created a huge saving for health Indiana families.  Now with the new ruling, I would predict that UnitedHealthcare & Humana launch new short policies.

When you start looking to purchase a short-term policy, buyer beware. You need to make sure you know what you are buying. Always look at the last page of the brochure that lists exclusions.  With these plans, you may want to consider buying them from a name brand carrier.

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indiana group health insuranceMany companies will turn to the internet to search for insurance benefits. Since 1998, we have been helping these businesses obtain group benefits. In the beginning of the internet, very few people would go to the world wide web for insurance information. Today that has all changed, business owners want information at their fingertips.

We have seen all type of companies/people come to our site and ask questions. Over the last 20 years there has been a trend on the situations the company is in that leads them to us.

Here are common situations:

Small business that is less than 5 years old, looking to attract or retain employees. Start up companies that are funded will seek benefit information from the web. These companies usually need costs quickly because employee benefits are last on this list. Businesses under new ownership, a small business was recently purchased there may be an existing benefit package in place, new owners want to revamp benefits or shop out the market for a better deal. Then their company’s that are looking for new broker representation. The insurance community is understaffed, which is becoming a serious issue for companies when it comes to service.

Requirements for Group benefits:

For business to be eligible for group insurance benefits. Every week we field questions on how do we qualify for group benefits?

Group Health Insurance: There needs to be two enrolling members and one of the members needs to be on the wage n tax form (W2). With the passing of the affordable care act (ACA) no longer will husband & wife companies be eligible for a group plan, there must be a W2 employee.

indiana group health insuranceParticipation Requirements:

Most insurance companies require group to have a certain amount of participations to be eligible. Small group health plans carriers have different requirements. The standard use to be 50% of the full-time employees to be on the plan. A full-time employee in the insurance world is 30 hours a week. Other companies you must have 75% of “net eligible”. Net eligible is employees that do not have other coverage, so an Insurance company like Anthem, would accept a group that had 40 full time employees but only 7 electing coverage, if all the waivers had qualified coverage.

Group with 50+ participation requirement can be a bit more flexible. UnitedHealthcare has no participation requirements, a company of 99 employees could have only 10 taking coverage and the company would qualify as a group.

Additional lines of coverage like Life, Dental, Vision, & Disability have more standard participation requirements. Most companies require 25% participation.

Participation requirements do change more frequently than you would expect. The health insurance carriers could change every year.

One benefit of the affordable care act is the not having to meet participation for group health. If you submit your group health installation between November 15th and December 15th, you do not have to meet participation guidelines. Essentially every small company in Indiana can obtain health insurance, should they choose to do so.

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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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