Monthly Archives

September 2015

More than 20 percent of the people who signed up for Obamacare plans on state and federal exchanges for 2015 have since dropped their coverage.

By | Health Reform

Earlier this year, the Obama administration reported that 12.7 million had signed up for insurance on the exchanges. Roughly 22 percent of those individuals have since dropped coverage for various reasons, leaving 9.9 million paying customers on the exchanges as of the end of June.

by JOHN SEXTON8 Sep 2015

The number of paying customers is still declining but will be in the range of 9.1-9.9 million, which the Obama administration said was their enrollment estimate for 2015. That estimate is significantly below earlier CBO projections which projected enrollment of around 13 million by the end of 2015.Apply for Obamacare

One factor that impacted the decline was cutting off 423,000 enrollees who were unable to provide proof of citizenship. Non-citizens are prohibited from purchasing insurance through the Obamacare exchanges.

Even if the enrollment does meet revised projections for 2015, enrollment will need to double to meet the 21 million projection for next year. Some analysts predict enrollment will jump as the full force of the mandate kicks in for 2016 (a penalty of $695 or 2.5 percent of income). However, price spikes in the marketplace could offset this incentive.

The individuals already enrolled in Obamacare are overwhelmingly from the lower end of the income spectrum. That means growth must come from those who are somewhat better off and who are therefore eligible for smaller (or no) subsidies. In other words, the people yet to enroll in Obamacare are those who will most keenly feel any price spikes.

 

 

Obamacare can’t restrict sale of fixed-payout health plans, judge says

By | Supplemental Coverage

A federal judge sided Friday with an insurance company that says the Obama administration had no right to restrict the sale of its products to people who also hold medical insurance that complies with Obamacare’s standards.

By Tom Howell Jr. – The Washington Times – Friday, September 11, 2015

The plaintiff, Central United Life, said a significant portion of its revenue is derived from the sale of fixed indemnity plans, which pay out a specific cash amount when a beneficiary receives a health service, regardless of what the hospital or other provider charges.Judge

In his ruling, U.S. District Court Judge Royce C. Lamberth said the administration went too far in interpreting the Affordable Care Act to mean they could require insurers, through rule making, to only sell fixed indemnity plans to people who attested they also had substantial, Obamacare-compliant insurance.

The administration passed the rule, effective last January, to fulfill Obamacare’s core mission of making sure people are adequately covered when they’re injured or get sick. It also didn’t want people to buy these supplemental plans and think it shielded them from Obamacare’s individual mandate penalty for lacking substantive coverage.

Yet a “net good result” isn’t good enough, the judge said. Nothing in the 2010 health law changed the way a previous law, the Public Health Service Act of 1944, defined benefits such as fixed indemnity plans, which were excepted from its standards, according to his opinion.

“Forcing federal agencies to comply with the law is undoubtedly in the public interest, and defendants have not shown to the court’s satisfaction that this clear benefit would be outweighed by the harms putatively caused by [the government’s] policies,” Judge Lamberth, appointed by President Ronald Reagan, wrote.

While the ruling doesn’t have sweeping ramifications for Obamacare in the way that other, better-known lawsuits against the law would, it could produce a ripple effect among companies who offer fixed-payout plans and feel they, too, should be shielded from the rule and its consequences.

“Most of Central United’s fixed indemnity plan customers will not purchase fixed indemnity plans if they have to purchase major medical insurance first, as the Fixed Indemnity Insurance Rule requires,” the company said in its lawsuit last November. “They would and do, however, purchase Central United’s fixed indemnity plans even if they must also pay the individual mandate penalty under the Affordable Care Act.”

The Department of Health and Human Services referred a request for comment to the Justice Department, which could not immediately be reached.

4 Complaints Providers Have with Medicare Advantage

By | Supplemental Coverage

Medicare Advantage plans are widely popular among Medicare-eligible consumers, but not everyone is fond of them.

September 12, 2014 | By Dina OverlandMedicare Advantage

Medicare Advantage plans are widely popular among Medicare-eligible consumers, but not everyone is fond of them. Many providers actually dislike the Medicare Advantage program and, therefore, are reluctant to contract with Medicare Advantage Insurers reported NerdWallet.

There are five common issues that providers have with the Medicare Advantage insurers, which continue to boost their enrollment numbers with broader coverage than traditional Medicare, FierceHealthPayer previously reported. Three of them are summarized below.

  1. Complicated authorization and reimbursement. Many providers complain that the Medicare Advantage authorization process is tedious and delayed, which drains resources and their staff’s time. Providers also frequently have to dispute claims far more often than for Medicare. “Even if the payment is eventually the same, the cost of the added paperwork, stress, processes, appeals, calls and staff time bites through any profit, quickly causing a practice to lose money,” Martine Brousse, a patient advocate and health industry expert, said in the NerdWalletarticle.
  2. Unclear policies. Unlike traditional Medicare, which has clear guidelines explaining which treatments are covered and at what price, Medicare Advantage requirements differ for each insurer. That means providers potentially must reach out to individual Medicare Advantage insurers each time a patient needs treatment. What’s more, Medicare Advantage insurers can require providers to take certain steps, including offering cheaper, non-surgical or less drastic treatments, so providers must call the companies to determine what treatment they can deliver to their patients.
  3. Unpaid patient balances. Providers worry that they risk losing payments from some patients with a Medicare Advantage plan because those patients have a high liability. Traditional Medicare patients often have secondary insurance to help them cover expensive healthcare bills, making it easier for providers to collect payment. But since few Medicare Advantage members have secondary insurance and many of their policies have higher deductibles and out-of-pocket costs, it’s often more challenging for them to pay their bills.

An Alternative To Obamacare

By | Health Insurance, Health Reform

Limited Benefit Insurance

John C. Goodman , CONTRIBUTOR
Opinions expressed by Forbes Contributors are their own.
This piece was co-authored by Dr. Linda Gorman. Dr. Gorman is the Director of Heath Care Policy at the Independence Institute.

One of the strangest things about Obamacare is that it is trying to force millions of families to obtain the wrong kind of insurance. When they turn it down, these families often end up with no insurance at all.Obama and his staff

As an alternative we propose to allow people to obtain a more limited type of insurance – one that better meets individual and family needs. This insurance would be less costly than ObamaCare insurance; it would pay the vast majority of medical bills the family is likely to incur; and it would at the same time protect the family’s income and assets.

There are two reasons why people need health insurance: to protect assets and to gain better access to care. For young, healthy families with low incomes and no assets to protect, Obamacare’s mandated insurance is unlikely to meet either need.

Employees who earn $15 or $20 an hour, for example, typically have very few assets. In most urban areas you need to earn almost the median family income to be able to buy a house. If these employees have a car it probably has very little re-sale value. Most likely, they are living paycheck to paycheck.

Say one of these employees has the misfortune to have a pre-mature baby with very high medical expenses. Whether those expenses are $100,000 or $1 million doesn’t really matter very much. The family will not be able to pay even a small fraction of the bill. If they abide by Obamacare’s mandate and obtain health insurance with no annual or life time maximum, health insurance will pay the bill (beyond their out-of-pocket exposure). That may be great for the hospital that

Does Obamacare insurance improve access to care? In theory, it should. That would be especially true for specialist care in the case of a chronic disease. However, young healthy families typically don’t have expensive-to-treat chronic illnesses. Their medical needs are likely to consist of generic drugs, an occasional doctor visit and once in a while a trip to the emergency room. Without health insurance or a Health Savings Account, these families must pay for those expenses with money out of pocket.

The typical Bronze plan offered to employees of fast food restaurants has a deductible of $6,000 or more and it’s double that for family coverage. With this type of plan the family will still have to pay almost all its expected medical bills out of pocket. Employers are allowed to charge employees a premium equal to 9.5 percent of their wages for this type of coverage. It should come as no surprise that almost all the employees turn these offers down.

A Kaiser Foundation study finds that among families with private heath insurance whose income is between 100 and 250 percent of the poverty level, the median amount of liquid assets is $766. The net financial assets (after subtracting such things as credit card debt) for these families is $326. Obamacare insurance for these families is almost like having no insurance at all.

If there were no government interference, what kind of health insurance would these employees want? We already have some idea. Pre-Obamacare employers of low-income workers often provided “mini med” plans in lieu of taxable wages. These plans paid for expenses the employees were most likely to incur, with a cap, say, of $25,000. If the law had allowed it, they no doubt would have included generous deposits to Health Savings Accounts – a more efficient way of paying small medical expenses.

Still, what happens as the family earns more income, accumulates some assets and becomes vulnerable to some of the health problems that accompany aging? Does it have to be sky’s-the-limit insurance or mini med? Or, could we have something in between?

We propose to allow people to obtain limited benefit insurance. Such insurance would cover medical bills up to $25,000 or $50,000 or even $100,000 – depending on the policy. Suppose a family buys $50,000 of coverage. Insurance would not only pay for the first $50,000 of care. The family’s income and assets would also be protected from claims arising from unpaid medical bills up to that amount. Above $50,000, creditors could garnish wages and seize assets. As families get wealthier, however, they could increase the limits of their coverage.

Limited benefit insurance won’t pay the cost of a $1 million pre-mature baby. But it’s better to cover those costs with traditional safety net money rather than forcing families to buy inappropriate coverage.

It’s becoming increasingly obvious to everyone in health policy that the Affordable Care Act was designed by above-average income people to meet the needs of people who are just like they are. Of course they want coverage without annual limits. If they have a premature baby, do you think they want creditors to seize their million dollar house or their new foreign sports car? And if they face a $6,000 deductible, so what? At the worst they can cancel their next vacation.

Obamacare takes care of the needs of the upper income special interest representatives who designed it. Now it’s time to create an insurance plan than meets the needs of the bottom half of the income ladder.

Visit johngoodman@goodmaninstitute.org and follow me on Twitter @DrJohnCGoodman. Read my books: Living With Obamacare: A Consumers Guide; A Better Choice: Healthcare Solutions for America.

Can an EPO Health Insurance Plan Save You Money?

By | Health Insurance, Health Reform

A review of exclusive provider organization plans, or EPOs, and their benefits and drawbacks.

Pig Stethoscop

SOURCE: FLICKR USER 401KCALCULATOR.ORG.

Exclusive provider organization plans, or EPOs, are a form of health insurance that attempts to rein in costs by limiting insurance coverage to a select group of healthcare providers. Unlike PPOs and HMOs, which allow for some out-of-network care, people with EPOs must receive all of their care within an EPO network in order for the EPO plan to pay.

The benefits of an EPO plan
Because EPO plans limit patient access to a specific group of providers, they can negotiate favorable reimbursement rates with those healthcare providers that can lead to lower monthly premium payments by patients.

The money-saving benefit of EPOs is a big reason many people choose them, but they do provide a bit more in-network flexibility than HMOs as well. While HMOs require people to obtain referrals from a primary care physician before visiting a specialist, in many cases no referral is required for visiting specialists participating in an EPO plan.

The drawbacks of an EPO plan
EPO plans are often less expensive than HMO and PPO plans, but those cost savings come with a hitch.

Both HMOs and PPOs provide for more doctor choice than EPO plans and that flexibility can be a deal-breaker for people considering whether an EPO plan is right for them.

In most cases, an HMO will help pay for out-of-network care as long as a patient’s primary care physician has sent a referral. A PPO will similarly provide for out-of-network care, often without a referral, but at a higher out-of-pocket cost to the patient.

Because EPOs’ provider network is limited, there’s a good chance that a patient’s existing doctor may not be part of the EPO’s network and that would mean changing doctors — something that would make many people balk.

Even if people are willing to give up doctor flexibility for cost savings, they may find that an EPO plan is hard to find because HMOs and PPOs remain far more common. Last year, EPO plans made up just 7% of plans offered on the Obamacare health insurance exchanges.

Other considerations
Although EPO plans don’t provide out-of-network coverage, that doesn’t mean patients are left high and dry in the case of an emergency. All EPO plans are required to provide some insurance coverage in those instances