Category News

Here at Nefouse and Associates we know how everyone enjoys watching C-Span especially when it comes to health insurance.  So I have watched it for you and will give you the update.

Health and Human Services Secretary Kathleen Sebelius testified on the impact of the 2010 health care law. The Secretary job is to interpret, clarify and install the health care law. She was asked specific questions by Senators about the law.

The chairman of the committee helped right the law so he was very happy to praise the law and not ask any difficult questions.
The next Senator was Mike Enzi  and his questions were geared towards the child stand alone policies. Under the law children under 19 are guaranteed issue and many carriers have pulled out of this market. So the Senator goes on to ask what is the Secretary doing to address the issue.  The Secretary responded that the states should force carriers to cover these markets.  The Senator asked specific questions about parents gaming the system by waiting until the child needs care to take out a policy.  The Secretary did not give a clear answer on this.

Senator All Franken was up next. He really tried to simplify the health care law by comparing it to a 3 legged stool.  There was not a lot of substance there. Almost to the point you wanted to ask him had he done his homework? The Senator did speak about Medical Loss Ratio and how it was his idea.

Senator John McCain was very prepared for this hearing. He asked about all the waivers that had been given to companies and why not make them permanent.  The Secretary assured the Senator that these companies just need time to adapt to the health care law. The Senator then asked about waivers for Medicaid so states could reach their budgets. The Secretary stated certain areas of Medicaid would not be eligible for waivers. Then The Senator ask if Malpractice caps could be introduced and if the Secretary would support it. She said Yes.

Senator Jeff Bigaman talked about the Work Force Commission and how those resources would help stream line health care services.  The Secretary spoke of the potential role this commission would have.

Senator Michael Bennett addressed the costly issue of readmission of Medicare Beneficiary. This was addressing the cost of Seniors on Medicare having multiple admissions to a hospital. He stressed the issue of Transitional Care  and a more Effective delivery model. The Secretary spoke on progress of these areas.

Senator Pat Roberts spoke about his past history with the Secretary and her family.  Then he addressed the head of the CMS and then talked about Independent Advisory Boards with regards to the Emergency Access centers in his home state.  The Senator was making statement rather than asking about questions.  There was no explanation on why this board needed to address ER access and who is even on this board.

Senator Jack Reed was stressing that the Mandatory coverage aspect of the law was pushed by the Insurance Industry.  He was stressing maybe even blaming the insurance industry for this mandate. The Secretary then “schooled” the Senator on how a Private Insurance Market stays Solvent and without the mandate the market would incur adverse selection.

Senator Richard Burr talked about the cost of the reform law. He pointed out that CMS had recently released a $200 billion short fall on the health care reform. The Secretary very calmly recognized that loss and did not dispute that. The Senator then asked a tough question about the Medical Device Tax that will lead to increase cost.  The Secretary did not agree the tax would increase the overall costs.

Senator Bernie Sanders talked about community health centers and how investing into them will lower cost down the road.  The Secretary agreed.

Senator Kay Hagan talked about children being allowed to stay on a parents group health plan until 26. She spoke about her personal experience and then the Secretary talked about her personal experience of finding her adult child a health insurance policy.

Senator Patty Murray spoke about how the law is going to make premium increases more transparent. The Secretary went on to explain that premium increases have to be justified by the carriers and the federal Gov. is giving resources to review those areas. The Secretary also explained how more information about the insurance company was going to be public record. So you can look up how many claims have denied by a carrier and so on.

So there you have a hour and half of testimony summarized into a blog posting.

I thought the Secretary was prepared for this hearing she did a good job explaining certain aspects of the law.  Where I feel she is letting the country down is on the cost of the law. There was only one Senator that asked about the cost.  Only 3 Senators really asked tough questions the rest were set up questions for the Secretary to explain. There is 2,700+ pages of this law and then 1,000’s more  pages clarifying the law.  The Senate should have asked much deeper questions.

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Here at Nefouse & Associates we have found a carrier that will insure Individuals that are suffering from Diabetes.

There are some very strict underwriting guidelines. The diabetes has to be treated with medication and not insulin. Also the applicant cannot be taking more than 3 medications.

This is a true health insurance plan.

Let us know if you have questions.

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I know most people find health care debate to be boring but the reality is this is going to effect you one way or the other.

Congress has formed two committees to investigate the entire law and the impacts that it will have on the economy.  I know some people feel this might be a waste of time but we really do not know what is in the 2000+ pages of the law.  The law effects 1/6Th of our economy and will effect all of us personally.  There should be plenty of bills being introduced to change certain aspect of the law.

So keep your ears open to the debate.

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The house is going to vote on repealing the health care reform.  Most news outlet are stating this is a symbolic gesture.  I think its a lot more than that. The healthcare reform bill is a huge gamble with 1/6th of the economy. The health care reform bill has done nothing to address the cost of care. The best way I can describe the reform is an attempt to increase benefits to reduce cost. The bill really fails to use math in calculating health coverages.

There are many states right now that are trying to figure out how they are going to pay for the reform. Most of this comes from an expansion of Medicaid. The carriers could pull out of certain markets because of restrictive laws regarding Medical Loss Ratio.  Some fear the law could keep companiesfrom hiring employees because they do not want to go over the 50 employee market. With50 employees that opens the doors to many penalties that come in the form of fines.  There is real concern with how the exchanges are going to be set up and if they can be set up on a state level.  There is so many issues that have not been clarified that it is many people are worried.

People that support the health care reform high light areas that sound good. No child under 19 can be declined a policy. This is a good thing but the carriers have pulled out of that market because the federal gov. would not put conditions so people don’t game the system.  Adults can stay on their parents group health plan until age 26 is being pressed as a very good thing.

There is huge discrepancies in what this bill is actually going to cost.

The health care reform is a huge gamble with our economy. The law need to be looked at openly. There is also another 1000 pages of the law that could be viewed as nothing more than an expansion of government into private lives.

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As health insurance prices continue to surge we are seeing a higher demand for Surgical and Hospitalization health plans.

This type of approach for health insurance is being entertained in both individualand small group health markets.  These plans show a change in how we view health insurance. People are willing to take out a plan that covers the most expensive aspect of health care and that is surgeries.

A typical hospitalization and surgical plan has a lot of craves out that in the past have been automatic with health coverages. A big carve out is coverage for diagnostic services. So if a customer is on one of these plans and needs a MRI on their knee then they half to pay for it out of pocket but could still get the network discount. We are seeing plan designs that carve out all prescription drugs.

Someone might look at this plan and think this is too much risk to take on. Not really! If you look for a plan that covers all the carve outs on an inpatient basis then the coverage can be satisfactory.

As we move along with health care reform there is no premium relief in site. These type of plans are going to continue to get serious looks from consumers because they usually are 50%-60% less in premium than a traditional.

Do not confuse these plans with limited liability policies! Hospitalization and Surgery plans are true forms of insurance.

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As we enter in 2011 more aspects of  health care reform will have a direct impact on you.

All wellness and preventive care is now covered at 100% with not cost to the customer.   So there is no reason not to get your yearly check up. Technically speaking if you have diagnostic services done for wellness you would not pay anything.

 Guaranteed issue for children under 19 year of age:

This means a carrier can not deny a child coverage. Now we have a huge problem with aspect of reform because all of the carriers have pulled out of the stand alone child policy market. The other issue is the rate up that the carrier can charg for the child. We are seeing about 400% increase in premium for the child.

Medical Loss Ratio.

This states that at least 80% of your premium has to go to claims or you get a refund. This sounds like a great thing but in the long run it could prevent carriers from entering certain markets. The market where we could see carriers pull out of is Individual.

Individual Maternity Plans are no longer available

Health carriers have pulled out of these markets because of the negative impact of health care reform. It still is not 100% clear but I think if the carriers were to stay in the market the plan could not have a waiting period for the maternity benefit to kick in. In the past a policy had either a 1 year or 9 month waiting period.

Health insurance premium increases

The health care reform does nothing to reduce the premium increases. The premium increases are a direct response to the cost of care. The Reform does put in place a process of review if a carriers want to increase premiums more than 10%.  It is important to have these checks and balances in place so everyone sees the process.

Health Savings Accounts

For 2011 the contribution levels will stay the same for a H.S.A custodial account.  (Single $3,050, Family $6,150)  For members over 55 years of age there is an additional catch contribution of $1,000.  Over the Counter medicines are no longer qualified to use HSA accounts to pay for.

Waivers for Health Care Reform

There are a lot of waivers for health care reform because the reform would result in people losing coverage. There should be many states that ask for waivers in 2011.

These are just some aspects of health care reform that will impact you.

There are going to be positive things but we fear the negative could destroy certain markets.

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In 2003 the Medicare Prescription Drug, Improvement, and Modernization Act went into place and created the Health Savings Account.

The health saving account is a high deductible health insurance plan.  All medical claims go towards the deductible for the exception of wellness. All preventive and wellness procedures are covered at 100% with no cost to the insured.  The best way to look at these plans is they are major medical policies that will cover you for the major claims and you are responsible for the small things. 

The health savings account makes it easier for families and individual to budget for health care expenses.  Once your deductible is satisfied then all eligible claims are covered at 100% depending on the plan design. With this plan there are also tax advantages.

I think everyone should look at this approach to health insurance. The health savings account engages people to look at their health care expense and I think that is very important. If you take advantage of online tools then you will discover that diagnostic test you  need has a huge cost difference. The hospital might charge $2,000 and an outpatient facility charges $400.  If the first $2,000 in claims comes out of your pocket I think you might want want to use the facility that charges less.

Now is the right time to entertain this approach to health insurance.

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Here at Nefouse & Associates we have been insuring children that suffer from Autism for almost 5 years. I feel we are the most experienced Brokers in the state when it comes to insuring  autism.

The past few years children suffering from Autism have been very fortunate with the Indianapolis Autism mandate. Under the mandate Autism has to be covered as any other illness with few limitations on treatment.

Anthem has been the leader in the health insurance industry for treating Autism. They have set up their own claim division that has processed claims. The majority of these claims have come from out of network providers.  Anthem has treated these claims as if they were in network providers because they have not established a network for Autism.  The Autism providers have been able to treat patients and be paid without joining any kind of network.  This is about to change!

Currently Anthem is building a Autism network. This is going to change the way people are treated for Autism. In the near future Doctors, Facilities, and Specialists will have to be a part of the Anthem network or the claims will go toward out of network deductibles for policy holders. This could create a disruption in treatment and payment for both patients and providers.

On the provider side of it if they do not join network they might have problems getting paid by the carriers. If its a out of network claim then the insurance company could send the payment directly to the insured.

On the patient side if the claim is considered out of network then carrier could usual and customary charge for the claim. This means the provider charges $500 for a procedure but the insurance company states the average price for this is $200. The insured its stuck with the difference.

Anthem is building this new network and its not expected to go live until April. If Anthem is building one then the other national carriers are not far behind.

If you have a loved one suffering from Autism then start asking questions of your provider about them joining a network.

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There is been a much higher demand for the short term health policies here in Indianapolis than in the past. I think the reason for this is the lower cost of the short term policy.

In the past short term policy were manily used by students and singles that were in transition from one health plan to the other.  Now it has changed a great deal. We are seeing families looking into short term policies.  A family that would cost $400 a month on an H.S.A can pick up a short term for $100 a month.  With so many dual income families losing one of those incomes these short term policies are becoming serious options.

We have seen a variety of short term plans hit the market in the last 3 years. In the past there were only emergency room type policies to choose from. Now we are seeing co pay type plans being introduced. These co pay plan might even have a rx benefit. So now a client can choose what level of short term policy they would like.

If you are serious about taking out a short term policy then you should be looking at a company that owns their own network. The reason for this is you have to use it you want the deepest discounts available. The deepest discounts are going to come from companies like UnitedHealthcare and Anthem.  Smaller carriers can be competitive in this market but I would advise a client to take a short term policy form a national carrier.

If you do take out a short term policy remember that policy is not re newable.  This is a major different when comparing short term policy with a long term. So if you get diagnoised with something major you might have trouble finding a policy to cover you.  This is a very serious issue when comparing.

In the near future I expect to see short term policies that have 11 month terms. That mean you will be able to take a policy out for almost a year. I see this a quick fix not only for the very young but the family market too.

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Under the health care reform children under 19 can not be denied or pre x on health insurance. This law is now in place and the carriers have developed strategies on the law.

The first thing the carriers have done is completely with drawn from the stand alone children’s policy. So now in this country you are unable to buy a stand alone health insurance policy for your child. The carriers were very concerned that parents would game the insurance market. This means that a parent might wait to take out a health insurance policy on the child until they need it. Since the Government would not address this issue the carriers just  pulled out of that market.

So the only way to insure a child in the private market is for a parent to be on the plan also. This has created some unique situations. The carriers will except the entire family but they now are rating the children up 200% for any on going health conditions. This strategy is making the health insurance unaffordable for most family that have children with medical conditions.  A family of 4 that should run around $400 a month now is over $800 if they have children with major medical conditions.

From the insurance carrier stand point even with the rate increase they will still lose money. Any child needing major health care is going to incur much more than the annual premium in claims.  If a family is paying $9,000 a year in premium plus the deductible but they incur $25,000 in claims the insurance company is going to lose. So then how long will the carriers be able to sustain writing those policies.

This is a very complicated situation that the health care reform has caused.

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