Tag health insurance premiums

Is it legal to move an employee from my group health plan to the a guaranteed issue individual plan?

This is a big question with a lot of money on the line for employers and insurers.

During open enrollment (October 1, 2013–March 31, 2014), anyone could have purchased a health plan either on or off of the exchange. Keep in mind that if an employee has access to a group health plan, it might disqualify them from receiving tax credits on the exchange, but not on the actual health plan.

A University of Minnesota’s law professor had a paper published back in 2010 that predicted this exact situation. If you read the paper, you will see it was predicted that employers would redesign their health plans to intentionally try to move high-utilization employees off of the group plan. I, on the other hand, would disagree that a plan would be designed with that being the primary intention.

This issue opens up a very interesting discussion for large self-funded groups. This issue would not impact small companies that have fully-insured premiums. On large self-funded plans, the employers pay the initial claims up to a certain point. That certain point is called “stop loss” insurance. It is exactly what it sounds like, stop the losses.

Under these arrangements, the reinsurance contract to initiate a term is called lasers. Lasers (excluding individuals or setting a unique, higher pooling level for individuals who are expected to have large claims, increase customer liability) are optional, depending on risk tolerance .

An example would be a group that has a stop loss limit of $125,000 per person on the plan. This means the company is going to pay the 1st $125,000. There is a high claimant that is projected to have $700,000 in claims. The reinsurance contract has the ability to laser and moves the $125,000 stop loss to $400,000. Now, the employer is responsible for that $400,000.

At this point, options may be entertained on controlling cost. With the new Affordable Care Act, an option that might be discussed is moving the high claimant to an Individual health policy during open enrollment.

To learn more about how we can help your business, give us a call at (800) 846-8615 and we will be glad to sit down with you and answer any questions you may have.


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Did you or a loved one lose health insurance coverage in the last few weeks? You might still be able to get insured under special enrollment if you have a qualifying life event.

Every health insurance provider has different requirements to get insured, but they all follow the same set of guidelines put in place by the Federal Government under the Affordable Care Act.


Here are the most common reasons for loss of coverage and the documents and/or requirements needed:

  • Termination of employer contributions

Requirement: Letter from employer to verify termination

  • Exhaustion of COBRA coverage

Requirement: Certificate of Creditable Coverage and/or COBRA term letter (proof of prior health care coverage)

  • Loss of employer sponsored health insurance as a result of termination of employment

Requirement: Termination of coverage letter

  • Termination of short term medical plan

Requirement: Termination of coverage letter

  • Divorce or legal separation (loss of coverage under spouse’s health insurance)

Requirement: Certificate of Creditable Coverage (proof of prior health care coverage)

  • No longer eligible as a dependent due to age

Requirements: Letter from carrier indicating dependent is no longer an eligible dependent

  • Death of a spouse (loss of coverage under spouse’s health insurance)

Requirement: Termination of coverage letter

  • Spouses employment terminates (loss of coverage under spouse’s health insurance)

Requirement: Certificate of Creditable Coverage and/or Term Letter (proof of prior health care coverage)

  • Employer reduced working hours (no longer eligible for group coverage)

Requirement: Letter from employer to verify

  • Current plan change to eliminate coverage for certain groups (e.g. part time workers)

Requirement: Letter from employer to verify

  •  Group coverage terminates due to non-payment of premium – Employees can use this as a QLE  

Requirement: Letter from employer to verify

  • There is a health claim that will meet or exceed the plan’s lifetime limit on all benefits

Requirement: Explanation of benefit validating lifetime benefit met

  •  2014 Renewal

Requirement: Renewal letter from existing carrier

  • Non payment of premium, misrepresentation or fraud

Requirement: Reinstatement denial letter or rescission letter

  • Relocation/ Move

Requirement: One of the following is required to validate coverage is in force:

      • Other carrier information:
      • Name of carrier and phone number
      • Effective date
      • Termination date
      • Policy number
      • Type of coverage
      • EOB with Effective date and termination date of coverage

One of the following is also required:

      • Proof of new residence (e.g. mortgage document or rental agreement)
      • Driver’s license with current residence
      • Utility bill with current residence

Some of these requirements are easily obtainable whereas others are a little more difficult. The main problem at the moment is that the health insurance company or marketplace will request a copy of your Certificate of Prior Coverage (COC), but you won’t be issued this document until your previous plan has been terminated. It can take up to a month to get this document from your previous carrier.

Some insurance companies are putting a time limit of 15 days to provide this document. This is not a realistic time frame. If you are applying for a health insurance policy on the exchange, you can’t submit your application until you lose your current coverage. Then, your new plan will start the following month. This is not ideal because you could end up with a gap in coverage.

Here at Nefouse & Associates, we will look for other documentation that will satisfy the insurance companies. Tackling individual health plans off of open enrollment can be a difficult and stressful task. Let the experts at Nefouse & Associates take the stress off of you. Call us today at (800) 846-8615!

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Senator Rand Paul has been one of the biggest critics of the Affordable Care Act. You might remember when he took out a policy on the marketplace for his family, which placed his son in Kentucky on Medicaid. He told the public over and over his woes of trying to sign up, trying to pay and the general confusion about if he was actually signed up.

Now, Senator Rand Paul, is saying repeal is unlikely.

In Indianapolis, we have had about 100,000 people get health coverage because of the ACA law, and many Hoosiers have benefited from tax credits. We placed a large amount of people on the exchange which brought about huge tax credits. Older couples went from $1,400 per month to only $300 per month after the tax credit! 

Large families that were accustomed to paying $1,200 per month are now paying only $500 per month. Many Hoosiers were able to place dependents on Medicaid programs when they did not even know they were eligible for enrollment.

Then there was the “Holy Grail” benefit of the ACA: guaranteed issue! No matter how you felt about the new law, this was the one aspect that everyone could agree on. The ability to obtain a health policy without being denied is a positive impact of the law no matter how you look at it.

Despite all of the positives, there are still a few segments of Hoosiers that are not benefiting from the ACA, but instead being penalized.

First is our middle class, who do not qualify for tax credits. They have seen large rate increases in health premiums. Next are the group health plans being provided by small group employers. On average, these plans have seen 35-55% rate increases. This is going to be a huge problem for local small businesses. 

Recently, Indianapolis agreed to allow “grandmothering” which will extend non-ACA compliant health plans. The administration, both locally and federally, have realized how big of a negative impact the ACA is going to have on small groups.

Going forward, the opponents of the ACA will have plenty of arguments to make about the cost of the law. The proponents will have a difficult time defending the cost. The other issue is Hoosiers having to make decisions about new doctors and taking on more risk in out-of-pocket.

It does not matter if you agree or disagree with the law, you have to make the best decision for you regarding your health policy. That’s where we come in! We can help you make an informed decision. Call us today to get started at (800) 846-8615. 

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HealthCareOct_iStock_000019170348_heroAs the new healthcare laws take firm hold in the state of Indiana, we are starting to see the full impact on small group health plans. Small group health insurance has always been a challenge for many companies over the years due to cost.

Small group health plans are for companies that have less than 50 employees.

Small business owners were supposed to gain more choices and cheaper rates from the new online-health-insurance portals. However, they have been slow to select plans through marketplaces since the rollout started last fall. This can be attributed to several factors including technical problems and the administration’s focus on recruiting individuals and families.

The small business exchanges were meant to offer an online-shopping platform where employers could sort through plans from insurers and offer one or several options to their employees. Employees would then select from the options their employer had chosen, and their rates would reflect any employer contribution. That’s a different process than the one used by the exchanges for individuals, where people can select a single plan to cover themselves and, in some cases, their families.

Most of these healthcare plans are on a fully insured health contract. Under the new law, these plans no longer have medical underwriting. There are also additional mandates that the plans must cover. This creates some serious problems for most small companies. We are seeing an average rate increase of 57% on small group health insurance premiums. 57% is a significant increase not only to the owner but to the employees as well.

You, as a decision maker, do not have to accept this type of rate increase. There are other options for you! These options are going to be “outside the box” of traditional employee benefit thinking. If other consultants want to blame our current administration, that’s fine, but we are working on new solutions.

Employers can apply for coverage through the small-business exchange at any point during the year, and those who are eligible to shop for coverage (firms with fewer than 50 full-time workers) are by definition exempt from rules that will soon penalize companies that do not offer plans to their workers.

Individuals have a limited window, which closes at the end of March, during which to purchase coverage for the coming year. Those who fail to secure a health plan may be subject to a tax penalty under Affordable Care Act rules. If you want a new solution for your group health insurance, contact us.

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If you to took out an individual policy from Anthem with a 1-1-14 start date, I would recommend making your payment online if you have not.


On Anthem On the Exchange Payment Portal  If you mailed in you check you will be better off submitted an online payment. Anthem is having a hard time processing the Paper Checks because they may not have the Anthem Control number on it. Without that control number they don’t know who you are.


Anthem Off the Exchange Payment Portal  Same issue with off the exchange business.


If you elected a January 1st effective date you have until Jan. 31st to get your payment made.



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autismFor families that are faced with Autism, there is great concern about how the new health care laws will impact them.

All of the insurance companies that will be participating have filed their plans with the Indianapolis Department of Insurance. From what we can tell, it looks like all of the plans will cover the Autism Mandate. It doesn’t matter if the plan is on the exchange or off of the exchange, the mandate will be covered.

When we look a the Federal Exchange plans, these plans are all HMO plans (Health Maintenance Organization) and operating on narrow networks. These plans state they are covering Autism under the mandate. The question is this: how difficult will it be to go out of network for the treatment of Autism? Unfortunately, we cannot answer this until we have actual claims. On an HMO plan, your doctor is the gate keeper to all of your care, so every medical procedure would have to be approved by your attending physician. This would add one more layer to the process of getting a treatment covered.

Outside of the exchange, we should see the same level of coverage that we have today. If you purchase a policy on a PPO plan (Preferred Provider Organization), then you will have one less obstacle to getting care covered. PPO plans allow you to visit whatever in-network physician or healthcare provider you wish without first requiring a referral from a primary care physician. One issue that we are waiting on is if stand-alone child policies will be available, which would help families a great deal if they only have to pay premium on the child.

From a carrier standpoint, our options are going to be limited.  We predict there will only be a handful of carriers selling PPO plans off the exchange. Right now, it looks like Humana and Anthem will be the main carriers.  UnitedHealthOne and Medical Mutual will not be offering individual health plans next year. Autism treatment facilities will want to build relationships with Humana and Anthem as they may be the only carriers left in the PPO market.

If the exchange plans work out, we could end up adding three more carriers to the equation, which would give us a total of five carrier options. The question then becomes this: do you want to be the first person to file claims for the treatment of Autism with a carrier that does not have experience in that field?

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http://www.dreamstime.com/-image13756165For the 7,200 policy holders who currently have a health insurance policy through Indianapolis Comprehensive Health, I have some good news.

Most of you have never had good news when it comes to health insurance. Under the new health insurance laws, your luck might change!

The first and most important point is that you can not be declined or rated up for any ongoing condition. If you are on the ICHIA plan, then you know what it’s like to get declined for coverage. Well those days are over and  you could possibly see a rate decrease! We are still going to have age-based premiums, but you could end up getting a rich plan design for less of a monthly premium.

Don’t think that you’re stuck with only one choice for health insurance; there will be health insurance policies offered both inside and outside the exchange.  Should you want to really reduce your premium, you will have the option of buying an exchange policy with a subsidized premium. These policies will look like HMOs and have very narrow networks.

If you decide that you are not comfortable with the narrow network, then you can purchase a policy outside the exchange. We should have the option of open access PPO plans. PPO plans allow you to visit whatever in-network physician or healthcare provider you wish without first requiring a referral from a primary care physician. The premiums for these plans could, in fact, be cheaper than what you are paying right now.

It’s rare in the health insurance industry to be able to deliver good news, so we’re excited to be able to give you this! Stick with us for information about Health Care Reform, and once October 1 comes around, you can sign up for your insurance plan right from our website!



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rising-resize-380x300-resize-380x300By now, you might have heard that the Indianapolis Department Of Insurance projected a 72% increase in individual health insurance market for Indianapolis. The IDOI has also released the Individual Insurance Market Report, which goes on to explain this projected increase.

This is a legitimate explanation for the increase, and the only thing that is not included into the 72% is the eligibility for subsidized premiums in the exchange. In the report, it does show that about 500,000 Hoosiers will be eligible for subsidies.

First, you must understand the way the IDOI determined the rate increase. They compared current medically underwritten health plans (in which they use  medical or health information in the evaluation of an applicant for coverage), Indianapolis Comprehensive Health plans (ICHP) (guaranteed issue, a policy that is offered to any eligible applicant without regard to health status) with Silver Plans.

According to the report, if you take a healthy 25-year old male and compare health insurance now versus on a Silver Plan, the current rates are $108 compared to $266 on the Silver Plan, which is a 145% rate increase. Now let’s use the same example, but this time we add pre-existing conditions. On the ICHP, the cost is $304 verus $266 on the Silver plan.  This is a 12.5% decrease.

In this example of healthy versus non-healthy, the non-healthy individual would benefit from the law with a rate decrease. Then, we add in subsidies and there may be real premium joy. For the healthy person that does not qualify for subsidies, now they have premium shock.

The report also looks at a 55-year old couple with excellent health and then with poor health. They may be paying $673 a month currently versus $1,188 on the new silver plan. This is a 76% rate increase…premium shock! If the same couple is unhealthy, they may be paying $1,673 a month on ICHP versus $942 on the Silver plan, which is is a 43% decrease. Premium joy!

I have two categories for post-Health Care Reform: Premium Joy and Premium Shock.

To get to Premium Joy, you will have to qualify for subsidies. To be really happy with the premium, one will need to be under the 250% Federal Poverty Level. Premium Shock is going to hit  Hoosiers that have household incomes over the 400% FPL.  These people could see 100% increases or more in premiums

Under the new law, everyone will have the same access to health insurance, which will help many Hoosiers. For instance, take the 7,200 people on the ICHP. The policy holders went to this high risk pool because they were turned down by a private insurance company. Each of those policy holders could see 25%-35% reduction in premiums in 2014.

So while the report states there will be a 72% increase in health insurance, that statement is only accurate if you don’t include federal subsidies.


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CompareSelfFundedandFully-InsuredIt’s common knowledge that offering health insurance benefits helps attract and retain great employees, yet businesses are looking for ways to cut costs as benefits get more expensive. Have you ever considered a self-funded insurance plan?

In a self-funded plan, a business can provide health benefits directly to employees. Instead of the insurance companies, the employer collects the premiums, assumes the risk and pays employee claims. Feel like that might be too much work? Insurance companies can still execute the administrative aspects for your company.

But what if the company underestimates its employees’ claims and can’t afford  to pay them? There are reinsurance contracts that have low stop-loss limits. Stop-loss insurance is just what it sounds like: stop the losses. This is a limit on the amount that a policyholder must make in coinsurance and out-of-pocket payments per year on an insurance policy. Generally, the stop-loss limit is stated as a flat dollar amount. Once the stop-loss limit has been reached, the health insurance company picks up all remaining expenses for the year. With a low stop-loss contract, a self-funded plan may be more of an option than what it has been in the past.

Below is a check list of what PPACA provisions will directly impact self-funded plans.If you are a group that has a self-funded plan or is entertaining a self-funded plan, these are the some of the provisions that must be covered. Once we see the full impact of the ACA on the fully-insured market, we may see that self-funded plans become an option for both small and mid-sized companies.


  • Prohibition on Lifetime Benefit Limit
  • Extension of Dependent Coverage to age 26
  • Restrictions on annual dollar limits for Essential Benefits
  • Medical FSA’s must limit reimbursements of over the counter products
  • Prohibition on cost-sharing for Preventive Services
  • Establishment of internal and external appeals process
  • Coverage for emergency services at an in-network cost-sharing level with no prior authorization required
  • Reporting on W-2’s of aggregate cost of employer sponsored coverage
  • Increase on HSA tax distribution for non-qualified medical expenses from 10% to 20%
  • Women’s Preventive Care expansion according to US Preventive Services Task Force
  • Quality of Care Reporting
  • Provide Summary of Benefits document
  • Medical Flexible Spending Plans limited election of $2,500
  • Notice of Exchanges
  • Eliminate tax deduction for employers taking the Medicare Part D subsidy for retirement prescription drug coverage
  • Comparative effectiveness research fees
  • Clinical trial coverage must be provided
  • Cost-sharing limitation for qualified high deductible health plans
  • Elimination of eligibility rules
  • Elimination of all pre-existing exclusion clauses
  • Reduce any eligibility waiting period to no more than 90 days
  • Employer mandate to offer coverage (delayed to 2015)
  • Reporting on minimum essential coverage to IRS
  • Reinsurance Contribution
  • Automatic Enrollment (delayed until regulations are published)







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

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

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

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

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

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

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

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

4. Elimination of annual and lifetime coverage limits.

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

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

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

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

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

7. The Medical Loss Ratio.

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


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

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

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



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