Tag Indianapolis Group Health Insurance

Trustmark Bank

Indianapolis has seen the introduction of several new group health products designed for companies with between 10 and 250 employees. What makes these plans intriguing is that they are self-funded health insurance vehicles.

In a traditional self-funded plan, the employer pays for its own medical claims directly. Meanwhile, a third-party administrator administers the health plan by processing claims and performing other tasks.  Self-funded plans usually include stop-loss insurance, which limits an employer’s annual claims responsibility.

A self-funded health plan has several advantages, including the following:

  • ·         The employer pays only for claims incurred after the network discount
  • ·         The employer can track the types of claims being incurred
  • ·         The employer can offer the same plan throughout Indianapolis because self-funded plans are not subject to state mandates
  • ·         Self-funded plans can be tailored
  • ·         The employer receives fewer billing surprises, because claim data is accessible all year

The newest Indianapolis health plans are a hybrid of self-funded and fully insured, also called level funding plans, which enable Indianapolis companies the opportunity for future savings. Companies can realize these savings if group claims are down. When claim levels are reduced, the employer may receive a portion of the aggregate claims liability account – also known as a claim pre-fund or claims funding. Some plans are designed to return up to 50 percent of the account, which could be equivalent to about 25 percent of the overall premium.

The stop-loss protection is what enables the plan to work like a fully insured contract. Even if your medical claims are higher than your claims funding, you won’t pay a higher premium, thus removing much of the risk from the traditional self-funded plan. You can predict your monthly payments.

The value of a level-funded plan is that you have access to claims activity. When it’s time to renew your policy, you have the knowledge to target and modify specific areas of the health plan.

Self-funded, group health insurance isn’t new in Indianapolis. Level-funded vehicles have been around for some time, too. So why are companies launching these new plan designs?

Companies are offering new products in anticipation of the healthcare reform community ratings set to take effect in 2014. With community ratings, the rates for sick and healthy groups are essentially the same. Underwritten groups will no longer exist and everyone will pay similar rates.

Level-funded plans have been successful in community rated states. Health groups or low utilization groups are scoring huge savings from these types of plans. Because the plans are consider self-funded, providers have more room to operate under the health care reform law.  As a result, companies have greater control of the health benefits.

Indianapolis health insurance plans begin with as few as ten people enrolled.  Are you responsible for selecting the insurance options for your company? If so, please contact me today. I’d be happy to provide you with a quote.

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The Hill

Under the new health care reform law, if an employer’s group health insurance is considered unaffordable — a cost to the employee of more than 9.5% of household income —  the employee would be eligible for tax subsidies through a health insurance exchange. 

As the law was originally interpreted, if the employee was also purchasing coverage for his or her dependents, the employee’s dependents would be eligible for subsidies if 20% of household income went toward the cost.  Congress’s Joint Committee on Taxation now views the law differently and has determined the subsidies are for the employee only. 

Here’s an example of what could happen: An employee purchases insurance through his employer. The employer pays 88% of the employee portion of the premium, but the employee also needs to pay to cover his dependents. The employee cost is less than the 9.5% of household income. Yet the cost of adding his dependents to the plan is unaffordable. Under the new interpretation, the employee’s dependents would not qualify for tax subsidies.

The change to the law’s interpretation is a huge blow for affordable health insurance. As a result, some experts predict a 95% increase in the cost of health insurance in the individual market, in addition to current rate increases.  A healthy person currently getting a good deal in the individual market could suffer because of cost redistribution. An increase of this size could have a crushing effect on the middle class, especially for those who are self-employed.

Have you seen a substantial increase in the cost of your health insurance? Are you aware of your options?

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 McKinsey study just released the methodology that they used to generate the report. The group released questions and results by the people that took the survey.

This study has become political so there will be arguments on both sides for and against.

I looked at the survey and results.

First thing that jumped out is over 35% represented companies with less than 50 employees. This is very important aspect of the survey with relations to health care reform. If a group is under 50 employees they will not have to provide benefits in 2014.

 When it came to the question about dropping health benefits in 2014 almost 29% of the surveyors that said they would drop benefits came from the under 50 class. This makes complete sense for these groups to look at alternative through the health insurance exchanges.

The other aspect of the survey that was interesting was that none of the surveyors had 100% complete authority over the group health insurance.

I do not think you can discredit the study. This was a 100+ questionnaire that people took the time to answer.

My News

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Indianapolis On Site Wellness

Inside Indianapolis Business reported on a story about a Dorel Juvenile Group attacking thier health care cost with an On Site wellness clinc. The company CEO stated that their health care costs were around $6 million a year. It sounds that this company has a Self Funded plan which requires them to pay the majority of the claims. This group decided that they would attack these claims but placing a FREE on site clinic to their employees.

We really don’t have a lot of details about how they set up this program but they did speak about a health risk assesment. From the health risk assement that must have given them more information on the health care needs of the employees.  Groups over 100 lives should look at having a health risk assement of the group to provide information on the needs of the group.

With balloning health care cost companies are looking to take aggressive action to control and reduce the cost of health care.

Dorel Juvenile Group has taken a very active role with improving the health care of their employee’s.  In today’s enviornment of a unhealthy work force company’s have to become involed with their employees over

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As the health insurance industry changes so does the process of obtaining health insurance. There has a big shift for people to go online to receive quotes. This is a very easy way to look at health insurance rates. The problem is most sites are collecting your information so that they can sell to agents all over the country.  The next thing that happens is you are being called by dozens of agents.

It’s important if you are in the individual market to contact a local broker so you avoid going through this. Online just check the site you are on to see if they have an address that is local.  Local agencies will have a much higher probability of offering you customer services after the policy is sold.

Should buy a individual health policy from an agent out of state ask them what kind of service they offer after the sale.

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The 1099 provision of the health care reform, which would have raised $19 billion to help pay for the law is on it’s way to being repealed. This aspect of the law would have required all businesses to file tax reporting for all vendors from which they purchased $600 worth of goods or services. Politico

This have been a hot topic issue since the law was passed. This type of reporting would take valuable resources away from small business.

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In the small group health insurance industry there has been a huge increase in carriers auditing their clients.  The audit consists of the carrier requiring the client to provide up today wage n tax information. The carrier is looking to see if the group is still compliant form a participation standpoint.

In the past very few customers would receive an audit. In 2011 there has been a much higher increase from national carries like Anthem and UnitedHealthcare calling for audits on renewing groups. I think the high increase of audits might have something to do with the Medical Loss Ratio in the new health care law.  It is my belief that high claims groups might be targeted for these audits.  My view on this is pure speculation but I am seeing a trend.

In the past we would only see an audit if there was a large decrease in participation in the plan.

If you are the owner or a controller of a small group health plan be very aware of the audit. If your group is not meeting participation it might be time to address that issue before you are forced to.

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Insurance Exchange Input

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

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

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

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

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

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

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

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House panel sends 1099 tax reporting to the floor

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

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

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

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

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