Archive for the ‘Association Health Plans’ Category

Hospitals are now required to publish the rates they charge for services. Will this be helpful for patient’s health, for controlling costs, for lowering premiums? Let’s see.

January 24, 2019

This Federal legislative mandate is another fine example of Government wanting to help, thinking it can help, penalizing business and general community to do something it hadn’t before, then mucking it. It’s a mandate for hospitals to publish the rate they charge for the services it provides. The “no insurance coverage rate” or sticker price if you like.

Anyone who has ever purchased automobile understands what “sticker price” means. Simple, it’s the cost listed on the sticker glued to the car you’re looking to purchase.
Is that what every one pays? No.
Is it the starting point for negotiating. Yes.
Would the provider charge uninsured patients less if asked. Yes

If you are old enough you will remember the rate card nailed to the inside of every hotel room in America. The hotel and lodging industry referred to that as their “rack-rate”. It was mandated that the rate be displayed.

But, every time you looked at the rates on the card you would ask yourself “Does anyone ever pay that much?”. It was the hotel’s “not to exceed” rate but rooms would be priced based on supply and demand.

So, now patients and technically potential patients will get access to what a hospital will charge for the healthcare services, supplies and facility it provides for the treatment the patient seeks.

Of course this won’t be helpful to anyone and adds cost to the venders.

If insurance, Medicare or Medicaid is paying the bill then it will not pay anywhere close to the “rack rate” hospital’s post. In fact, even a person, uninsured, will not paid this amount.

So what good is this mandate?
Technically, a hospital can divulge what a service would cost under the coverage and discounts the member’s plan pays. They all have discounted PPO rates which could be used to divuge cost to a patient.
But insurers won’t like that and in fact would go nuts, then go to court. Insurers guard their negotiated discounts like the United States guards Fort Knox.

Insurers would hate to see their negotiated rates scattered among the internet for all competition to see. It goes along with the Insurer’s resistance to publishing claim experience or loss ratios publicly.

Your humble author has long advocated that Insurers be mandated to provide insured’s the loss ration on their plan for the year even if it be made available only at renewal time. Do you think it would be helpful for an employer, large or small, to be able to see that its loss ration is less than 100%. How  would an employer respond if its loss ration is 55% at the same time the insurer offers a 30% increase at renewal.

Posting rates will do little to improve healthcare outcomes, little to lower out-of-pocket cost and nothing to lower premiums.

So, this new mandate will not:

  • Lower out-of-pocket costs
  • Lower premiums
  • Improve healthcare outcomes

But, politicians can boast that they have done something. Just as the ACA caused a complete disruption to healthcare delivery and financing this mandate will provide a veil behind which insurers can hide. You’ll see.

Let me know what you think because we’re all in this together.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf
It means “Walk the Faith”.

What if SCOTUS holds that the ACA is Unconstitutional? What can the GOP put in its place? You hold the solution, here!

January 10, 2019

Several years ago I jotted down a few ideas which, if implemented, would address at least the biggest issues in medical insurance and healthcare delivery: cost and access. With the recent Court decision deeming the ACA unconstitutional we need, that is the GOP, needs to offer betters solutions. The ideas below are a start toward that better solution.

You all know that I am an optimist trapped in a cynic’s body so my hopes of replacing the ACA with a workable solution are real but also guarded. But, what if you/we were asked for input to design a workable solution. Could you do it?

I have expanded the solutions, since jotting down my initial 12 points in prior posts, because I believe that there is an easier and less expensive means to address healthcare financing for the chronically poor, the uninsurable and the chronic uninsured. You may think that I have left a few issues untouched and if so let me know your thoughts.
However, I know that these ideas, if put in place, build the framework to address:

  • Those that want to buy insurance but are un-insurable.
  • Those who want to buy but who can’t afford the premiums charged for insurance.
  • Those who currently buy and pay for their coverage but are finding the increasing premium too much to pay. 
  • Those that don’t want to buy or will wait until they have a problem to buy insurance.
  • Guaranteed acceptance.
  • Pre-existing conditions.
  • How to push premiums lower
  • How to push unit cost of healthcare lower
  • Transparency (Total & Complete Transparency).

So, together we can develop the core outline of what Congress could build if it truly tried to bring about the best reforms for our system. Please give us your input to improve upon these points as well as address issues that we have not addressed or not addressed well.

It may be fun and interesting but who knows we might even make a difference.

Since Americans are used to the ACA mandates of kids to 26, unlimited lifetime, and wellness or preventive let’s leave those in. But,  let’s eliminate the Medical Loss Ratio (MLR) limits since no other industry in the world has its profit margin restricted like insurers are by the ACA. Other than that let’s assume we have a blank canvas upon which we can draw our ideas.

Here are the basic ideas to include in a bill to replace the ACA:

  1. Make health insurance premium 100% tax deductible for anyone who pays it.
  2. Make all fully-insured plans for individuals and families guaranteed issue but with a reasonable Pre-existing period for no prior coverage.
    Example – Pre-ex period: 12 months.
  3. Group plans of 2+ employees remain guaranteed issue with full take-over or “No Loss-No Gain” as it used to be called..
  4. Allow carriers a reasonable corridor for Risk Adjustment Factors (20%). Also, eliminate artificial pricing rules (such as 3:1 ratio) and let insurers determine pricing with their area rating factors based on their data and statistics.
  5. Tort reform: Loser Pays and/or Fixed Attorneys at 15%.
  6. Allow carriers and plans such as Association Health Plans to sell across state lines. (Possibly the most difficult of all.)
  7. Eliminate Essential Health Benefits and allow No new benefit mandates from states or Feds for five years. Allow insurers freedom to build plans as they determine.
  8. Mandate HRAs and MERPs permissible and available to implement on all plans.
  9. All insurers must publish and release statistics and experience data.
    It’s ok and can remain consistent with Hippa.
  10. Universal enrollment forms for all group plans and all individual/family plans.
  11. Health plan commission set at level 7% and does not increase as premium does.
  12. All Providers must post their rates per service. Hospitals must post their outcome statistics as well as infections, error rates, and other outcome data.
  13. State based or plan based re-insurance pools to assist Insurers in controlling premiums. If unlimited lifetime benefits are retained then Insurers and Plans need support to handle the increasing number of mega-claims. 
  14. Providing coverage for those who can’t afford to pay premium regardless of its cost:
  • Eliminate Exchanges. Allow people to be enrolled directly with the Insurer or Plan of Choice.
  • The IRS can maintain these enrollment records and disperse payments to Insurers and do so without adding fees to premiums.
  • That also eliminates the huge fees added to premiums by Exchanges to compensate the Exchanges.
  • Set the income levels for participation in subsidies (even use the current formula).
  • Eliminate the Medicare Expansion as it pushes people toward poverty.
  • Instead, keep these folks covered by the private market and allow them to obtain their coverage from private Insurers and Plans.

I also think we need to build incentives for employers to support wellness plans. If we want to bend the cost curve downward we must address behavior and expectations through affective wellness and benefit structure.

I do address coverage for the poor as I mentioned above. Setting a poverty level which assists folks in need but forces folks into Medi-Cal (Medicaid for outside Cal) is problematic as it may discourage folks from working their way out of their financial circumstances. Besides, those Medi-Cal plans “suck”. You would not want to be covered by one so why push these unfortunate folks into it.

So, this is our starting point. I encourage you to give this some thought and to give us your input. If we offer a worthwhile solution then who knows; we might make a difference. That’s what I mean when I say “We’re all in this together”.

Let me know what you think.
Until next week.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf
It means “Walk the Faith”.

U.S. Court rules the Affordable Care Act is unconstitutional. What should Americans expect?

January 3, 2019

So far, it’s amazing how little attention this Court’s decision is getting. Maybe there’s too many other headlines on which the Media must focus. Border security, N Korea, aggressive moves by both China and Russia, the 2,500 point reduction in the Dow, or the booming economy and threats of Fed interest rate increases, partial Gov. shutdown, or maybe even Christmas (Nah, probably not) are all getting headlines but the ACA being deemed unconditional is not.

Maybe the Media and the ACA supporters don’t want to highlight the Court’s decision for some political reason. The GOP doesn’t want to focus on it because it wasting of the best opportunity to Repeal & Replace. No, the GOP really has nothing to gain in bragging about this Court’s ruling.

To be fair and honest, there is nothing anyone on either side of the issue can do right now because the Court’s ruling will not be effective for at least a year and the Left will appeal the Court’s decision. Many believe this decision will be decided by the Supreme Court.

The Supreme Court (SCOTUS) is allegedly a “conservative” based court with a 5/4 advantage to conservatives. But, we can’t forget that it was Chief Justice Roberts who allowed the ACA to live based on his opinion that the non-compliance penalty was a tax and not a fine as the Dems had argued. 

That still seems surreal to remember that the Dems argued, even before SCOTUS, that the individual penalty was a fine and not a tax. Even the first sentence in Judge Robert’s opinion made opponents believe the ACA would be struck down but then cam the Judge’s second sentence which stated that the fine was indeed a “tax”. I can still remember where I was when I heard that and how fast the Media jumped on the initial statement believing the Court was striking down the ACA.
Geez, that was a bad day for American premium-payers!

So, what should we expect for the next 12 months? Not much really. The Politicians will try to use the Court’s decision to their own advantage regardless of which side of the opinion they stand. But, the only Republicans who may speak up will be the conservative group referred to as the Freedom Caucus. This handful of GOP reps fought hard for R&R but were unsuccessful due to the jello-filled backbones of the GOP leadership.

Heck, even reducing the penalty to zero, instead of repealing it completely, was weak. As you’ve read here before, your humble author has stated many times that setting a fine to zero does not mean a potential penalty is no longer in effect.

As of this moment, the partial Gov shut down is consuming the Media and the Left. They think this is an issue on which they can take the biggest political advantage so they will keep the Court’s decision in their back pocket, for now.

But, Republican, if they are smart, will introduce a replacement for the ACA that includes the features everyone likes but without the features that increase premiums. It is possible and you will read about it in next week’s post.

For now, sit tight. If you have coverage now, which I know you do, then you have nothing to worry about. People concerned about Pre-ex conditions also have nothing to worry about. In fact, the 10 million Americans covered by Exchanges who receive premium support have nothing to worry about either.

The fight will not be pretty and the Media will paint a picture of people suffering in the streets, of children not being immunized, of woman not getting prenatal care (or birth control pills) because they could not get the medical attention they need and deserve.

But, we’re in this together so let’s let people know that there is a better solution and it would increase benefits and lower costs. More to come.

Until next week.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf
It means “Walk the Faith”.

It’s that time of year again for “reflection”, and to look forward with the knowledge gained over the past year.

December 27, 2018

The unbearably hectic season of Thanksgiving and Christmas has past, New Year’s Eve is in a few days and frankly most of us are probably worn out or worn down. Face it, life has not gotten easier just because we have smart phones, iPads, the internet and even an economy that continues to boom. No, life is complicated, busy and frustrating as well as rewarding, gratifying and exciting. That’s life in the modern world.

Some people take a little time out of their busy schedules, at this time each year, to think about the year that’s past and consider their hopes for the year to come. In business one must reflect on the past year’s activity or results in order to forecast for the future. Some people do the same for their personal lives.

As you know, I’m an optimist trapped in a synic’s body so this is a most satisfying time of year as I review life insulated by the capsule of time lodged between Christmas and the New Year.
Let’s look at some good and some not so good with these thoughts in mind.

The GOOD
Second Year for Donald Trump to millions was a positive vindication of their honest hope that he could change the negative spiral America had faced for the previous 12 years. Yes, that’s right 12 years.
No Repeal and Replace, but a recent Court decision striking down the ACA as unconstitutional, which will cause more confusion than good. The Media will swarm this as a Trump debacle when in fact it is a result of poor leadership of Rep. Ryan and Senator McConnell. But it does give us a chance to make meaningful corrections. If they follow our  published14 step solution, that is.
Twitter  is a GOOD, even though I don’t know how to use it, but it has allowed the President to get his word out by going around the dishonest liberal press. While not all of the Pres’s tweets have been helpful, Twitter has provided a tool by which he can get his message out.
Snow in Sierras may be a local thing for folks living in the San Joaquin Valley of CA. But last Winter’s extra snow pack and rainfall gave CA a welcome break from the 5+ years of drought.  We pray for another season of snowfall.
Family Health, which is important to each of us, has been relative good for your humble author’s family. Unfortunately though, we do have close friends suffering greatly so we do pray for them. But selfishly, for our immediate family things are good, and  for that I am grateful.

The BAD or at least not so good

Congressional Leadership in Washington (not to mention CA) has been a great source of frustration for most of us over this past year. The GOP leadership is unable to communicate well to the people, makes things unnecessarily complicated and does not act together. In addition, it appears intent to maintain the status queue for what’s been so accurately described as a “swamp”.
Plus, January 2019 will usher back Nancy Pelosi as Speaker of the House. Ugh!
Press both national and local continues to be untrustworthy. Whether a Liberal or Conservative, one must agree that we can’t trust what we read or hear anymore without a bit of concern. It was similar in the Cronkite/Viet Nam era but then news traveled slower. Now, with the internet and people deliberately trying to push “fake news” it is tougher to know the facts let alone the truth. It’s hard to imagine this will get better soon.
Internet which I mentioned above, can be a most amazing tool for our life and health. When you search for goods or services or wish to stay in touch with friends it is incredible. Unfortunately, it can be a tool just as useful for confusion, misinformation, and evil. It’s user beware and we must all be aware.
No R&R, that’s right. With the Court decision mentioned above I predict that the 2019 House and Senate will not get anything meaningful done on repealing and replacing the ACA. That may be a good thing given the mess the GOP tried to force through in 2017. But it won’t be good for premium payers that don’t qualify for subsidy and small business that continues to deal with the high priced metallic plans of the ACA.

Hope for 2019, that’s right hope! I’m betting the economy will continue to go well. There will be more jobs and better pay scales available. We will feel the benefits of the American economy every where.
The biggest obstacle and concern will be the ongoing issues caused a Congress bogged down with hatred, illegal immigration, by Russia, China, Iran and their intent to cause damage to America. With their help we can keep North Korea, Iran and the middle east from spreading terror and disasters. Without their help it could be more terrorist acts and crisis. Plus, it would be helpful for Dems stop obstructing progress and to not worry about President getting a “win” on the border, trade, employment, terror, N. Korea, etc.

But, I am hopeful for several reasons. One, we are all more aware of who we should trust or not. We have a President and Cabinet trying to build America up not tear it down. And America is an engine that produces outcomes desired and envied by the rest of the world.
While others around the world try to tear us down they also know that there’s no place on earth like America.

Plus, you have me writing to you every week, helping you understand the “malarkey” our government and Media is trying to pass off as healthcare reform.

Have a safe and Happy New Year. Together we can make it through anything to build a bright and prosperous future. We may even make healthcare better and cheaper.

Until next week.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf
It means “Walk the Faith”.

Another year in which we can all say “Merry Christmas” without fear of persecution. Thank you Mr. President!!

December 20, 2018

It’s five days before Christmas and while the Stockings are not yet hung, I bet most of us are thankful that the “war on Christmas” has been placed on-hold, for another year.

So this week instead of promoting or dissecting some aspect of healthcare reform let’s look for aspects of 2018 and our own lives in America that bring peace and good will to man. Sorry that isn’t PC, should have said “good will to us all”.

I say Thank You to:

  • First Responders who run toward the crisis or danger while we run away. These brave men and women are better civil servants to our Nation than anyone else, especially politicians, can ever brag to be.
  • Military that in spite of a decline in funding and respect over the past 10 years continue to keep us save by stopping the dangers over there from reaching over here. I did not join the military when I was of age, a decision I regret to this day.
  • Law Enforcement officers on a daily bases as they walk or drive into unknown danger without hesitation and without the support of too many in our nation.
    We should all stand each time the National Anthem plays!
  • Teachers who signed up to help educate our future generations and continue do so even when facing the toughest environments. Wouldn’t it be easier to teach if English was the required language, parents would help from home, and Unions cared about kids more than self-preservation?
  • Moms for doing what they do to love their children even when we are unlovable. Giving birth might be the easy part for Moms these days as they too often take on the role of both parents and both bread winners in American homes. Moms are the first responders for our families and they need our help and thanks.
  • Our Churches that stand for the true Word of God and don’t give in to the secular-worldly efforts by too many to cast shadows upon what we all know is right.
  • Co-workers that come to work each day to work as a team toward similar goals of creating good products, good service, and respect for team.

Thank God, above all else, for His gift of the Lord Jesus Christ, for us all. God so love the world that He gave His only Son for us that we might have eternal life. To those of you who are believers you know that a relationship with Jesus Christ does give us an eternal home but also gives us a relationship throughout the year like none other possibly could.

That’s just a few.
To whom or what are you thankful that makes your life safer and better?

Love to hear from you and especially at Christmas we should know that we’re all in this together. 

Merry Christmas to all!! And to all, until next week.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf
It means “Walk the Faith”.

 

Post Mid-term election, pre – Christmas shopping and slower ACA enrollments all make for Blah-blah-blah misleading headlines. Don’t go to sleep!

December 6, 2018

Every day we see media headlines either boasting of the ACA successes or lamenting its failure and criticizing President Trump for the horrible performance. In fact the only people benefiting from the ACA seem to be the big Insurers but I’ll cover that another time.

Several stories over the past 10 days have skirted around the projected lower enrollment numbers on the ACA public plans. Last week those headlines landed on 800,000 fewer people will be insured “because of President Trump” of course. But the media takes it further. It also projects, based on “expert accounts” that there will be 247,000 fewer children insured and again because of the Trump administration.

Now, why would there be fewer children covered. That makes no sense.

I want to address these two issues because it seems impossible to believe. I expect the enrollment numbers in the ACA to be lower but the rational put forward for the results is too partisan, for me.

One complaint is that the Trump administration cut Federal funds that had been going toward the marketing and sales of the ACA’s IFPs (Individual & Family Plans). But, really?

That sounds fishy to me for a couple of reasons:

  • Is it possible that there is anyone in America who does no know about the ACA. Sure, a person may have been neglectful the past 7 years so they don’t know how to access the plans.
  • But, there is no provider or hospital location in America that does not have an ACA or Public Exchange placard hanging with in feet of every provider’s office.
  • If citizens are unaware of the ACA then how do they know about other welfare benefits like free phones, food stamps, etc..
  • But realistically, is it possible that the members on ACA IFPs last year would give up their plans this year? Since 90% of the enrollees get either premium or benefit subsidy, or both, why would these folks not continue their plans since they are immune to the premium increases we all pay.

One plausible answer is the increase number of Americans who are now employed and therefore receiving Employer sponsored plans. If fact any other reasons sound nuts.

So, the moral of this story is that the advocates for the ACA, including the Media, have a biased interest in projecting and proclaiming any mis-fact or un-truth which can harm the President or even move toward Single payer, yuck.

Once again we can see that to be informed means we must use our own common sense and not believe every thing we see or hear.

We’re all in this together so until next week.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf
It means “Walk the Faith”.

 

Post Election Review: What’d we gain and what’d we lose. By “we” I mean the average premium paying American citizen!

November 8, 2018

It’s only 12 hours post Election Day as I write this so everyone is still playing nice and watching for the “first dig of the spur” from the other side. When you read this, in 24 hours, I wager that the language used in the political discussions will already have turned back to negative, divisive or worse.

Will the House be nothing but subpoenas, investigations, impeachment, and obstruction?
Will the Senate, as well as other conservative voices reciprocate.
Will anything meaningful for America get done before the 2020 election?
Will we see nothing but gridlock and scapegoating?
I’ll let you fill in the answers to those questions!

Here are a couple random thoughts both Nationally as well as here in good ol’ California.

  • I doubt that the Employer Mandate will be eliminated which we have discussed in previous Posts. That is not a bad outcome because the GOP tinkering with the ACA was not helping.
  • Will the Individual Mandate be re-instated?
    Probably not, even though it should be.
  • Will anything positive be done to improve the ACA’s adverse rating methodology and burdensome fees and taxes added to it?
    Probably not!
  • Will “Single Payer” or “Medicare for All” advance anywhere in the Country or in  any State?
    Probably not, though it will get a lot of press coverage.
  • Will the truth about coverage for “Pre-ex conditions” come out showing that the Dems and the Media were fear-mongering the issue?
    Probably Yes, but people will need to listen closely to hear the truth!
  • Will premiums start to go down on ACA compatible plans?
    Definitely not!

 

What about the Golden State: California?

  • Will AHPs or STPs be allowed to exist and help the tens of millions who could benefit from them?
    Nope, not without a insurrection?
  • Will Insurers be allowed to restrict small employers access to HRAs with subtle threats to insurance brokers?
    We’ll see but I know one Insurer that for sure will not be restricting HRAs.
  • Will Californians see their premiums continue to increase at each renewal?
    Yep, but the Media will state that the increases are lower due to the good-work of the ACA. We’ve discussed that  effort in subterfuge before, too.
  • Should employers continue to sponsor group health plans for their employees
    Absolutely and do so with the Employer Driven method proven so effective.

Am I concerned about the future for healthcare financing and delivery in California?
I have been concerned about this issue since 1985 so I will continue to be concerned but I will not give up hope. Sooner or later (probably later) the status will become so unbearable that the solutions will be so amazingly clear that even the Dems in California can see it.

Let’s allow them to think that independent-competitive insurance plans operating in a less government regulated environment is their idea! Maybe that will do it.

Regardless, we’re all in this together, so keep the faith and keep watching for more “common sense solutions” as we venture forth together.

Until next week.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf
It means “Walk the Faith”.

California Voters have a chance to lower healthcare costs plus improve access. But it will take the proper “Vote” in the Mid-term election on Nov 6th.

November 1, 2018

California voters have a chance to start taking back control of the crazy out-of-control,  high-premium, low-benefit healthcare system in California. Premium increases exceeding 300%, since 2010, have literally destroyed our citizen’s access to the healthcare we need.

We all know that the health plans offered in California are the among the most expensive in the land with killer high out of pockets and “way too skinny” PPO networks.
That’s not News, so why is that important?
Because, with your vote November 6th, you have a chance to set in motion for the real possibility of changing the healthcare delivery and plans available in Ca.
Be sure to VOTE!

To lower premiums, improve benefits, increase access to more providers and get more health plan options – Voters just need to vote:

 Insurance Commissioner  –  Steve Poizner

For Governor  –     John Cox

It’s that simple, REALLY!

Then, we can begin introducing the solutions that you have read about in previous Posts. Can you imagine a California in which you have:

  • Dozens of high quality health plans available.
  • Plans with benefits that fit your need – not the Government’s.
  • Rich plan benefits or narrow plan benefits.
  • Plans with huge provider lists.
  • Plans with narrow provider lists.
  • Premiums that are affordable and 50% lower!
  • Reasonable reimbursement for providers.
  • Transparency and better control.
  • Most of all: available when you need it!

I know what you’re thinking. How can two elected positions create such possibility for change? The truth is that it will take effort and a little time but my bet is that Ca. citizens would start seeing a difference within nine to fifteen months after these men take office.

Reports are projecting insurer premiums for 2019. Estimates are that premium may increase from 15% to as much as 100% depending on the state or region of the country. In Ca. we will see increases on employer sponsored group plans in the range of 10% to above 50% with further push toward Silver and Bronze plans.

Of course, we all know that the premiums we pay for Silver and Bronze don’t usually buy much in first dollar benefits and leave huge out of pocket risks. If they do provide copays then those copays range from $50 to $250 which of course means people defer their medical care.

Regardless if you are Republican, Democrat, Independent, Libertarian or Green; we all have been hurt by the changes brought about by the ACA. This Fall’s election, the so-called mid-terms, provide Ca. citizens a chance to make a difference.

And isn’t that something we all crave, “a chance to make a difference”?

I could spend another 10,000 words outlining the potential improvements that might become reality if we vote wisely November 6th.
But I’ll save that for future Posts.

Certainly we can all agree that elections provide a time when truly “we’re all in this together”.
Let me know what you think.

Until next week.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf
It means “Walk the Faith”.

Recent Headlines suggest that High-Deductible Health Plans have “Fallen from Grace”. Is that true? Many Insurers hope so!

October 18, 2018

A number of stories have been published in recent weeks making the statement that “HDHP Fall From Grace in Employer-Based coverage”. Some of these stories rely on reports from the Kaiser Health Foundation (KHF) and articles from KH News (KHN).

KHF is a reliable source for health care and health insurance data; and your humble author has cited their data in numerous posts. The notion that HDHPs are getting less popular seems to stem from a survey conducted by the National Business Group on Health (NBGH) which predicts that the percentage of employers offering HDHPs will drop from 39% this year to 30% next year.

One factor cited for this forecast is that employers ( specifically larger employers) are being pushed to offer richer health plans in order to recruit and maintain a sufficient workforce. The great economy and historically low unemployment rates are making it harder for larger employers to find and hire the staff they need and will need to keep up with the growing economy.

We usually associate a growing economy with prosperity for more Americans but this time the economy and the jobs created by it is outpacing large employer’s ability to stay staffed. This issue is not being reported too heavily but it could lead to American businesses falling behind in filling orders and improving revenues. This kind of employment environment has never occurred in a peace-time economy.

The phrase “Employer Driven Health Plans” was trademarked many years ago as one firm in California pioneered the practice of putting Employers in the driver’s seat of their health plan, By integrating an HRA with a HDHP (usually HD but any plan really) the Employer can provide the benefits it desires or requires at a lower cost that traditional plans.
So, I offer a contrarian view for two reasons.

One, the forcast is based heavily on large employers and less on small employers who are growing just as fast as larger employers. If an employer with 10 employees adds one employee to staff that is 10% but if a larger employer( example 500 EEs) adds 10% it is a bigger number of Americans employed. While it is easier to survey large employers than small employers, the result stays the same, American businesses are hiring and need good benefits to compete for staff.

Two, it does not include the huge potential for Employer Driven Health Plans (EDHP) utilizing HRAs. Employers can continue buying HDHPs , which keeps premium costs lower, but then implement an HRA to improve the benefits employees desire.
Ever heard of  a plan “Turning Bronze into Platinum”? Well, that’s what EDHPs were created to do for employers.

Fact is:

  • Employers, both large and small, can provide richer benefits to their employees at lower cost using EDHPs than the standard or conventional plans available.
  • EDHPs can be more attractive to potential and current employees thus accomplishing the goal desired to attract and maintain good staff.
  • EDHPs not only lower cost and improve benefits but will also improve the quality of care received.
  • EDHPs also provide greater access to  that quality care  we all seek by making more providers available than are currently available on many plans.

Larger employers have utilized HDHPs on a greater percentage than small employers but not by implementing the concept of EDHP.

Smaller employers have had less access to EDHPs over the past 10 years due to the unlawful restrictions that many insurers have implemented. But due to a recent anti-trust lawsuit Insurers are no longer threatening brokers about using EDHPs.

This should mean that more small employers will see an EDHP proposal as an option when selecting its next health plan.

Brokers, consultants, Insurers and Employers should not give up on HDHPs as a potential solution to meet the health plan requirements for their staff. Employers should be presented every plan possible in the region to fulfill the RFP it presented, including an EDHP.

The result will be a resurgence in HDHPs with an increased level of satisfaction by both the sponsoring employer and covered member.

Employers just need to find a good TPA to present the EDHP options to them. If their broker/consultant does not present them with a proposal from an experienced TPA administering EDHPs then the employer needs to find a new consultant.

EDHPs are possibly the best example of why and how we are all in this together.

BTW, be sure to vote on November 5th.
Until next week.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf
It means “Walk the Faith”.

 

Autumn is a Season for two things: Elections and partisan promotion of the ACA’s Health Plan Exchanges. Boy, do facts get skewed for both!

October 11, 2018

I know my title was remiss by not including football and the World Series both of which are far more fun than mid-term elections or the ACA open enrollment period. Remember, this is a healthcare blog so I will stay on message.

I don’t want to address the facts, stats, and promises politicians make at election time but I do want to point out a few corrections or misunderstandings (make that mis-information) that ACA supporters use to promote the Government run Health Exchanges at Open Enrollment (OE). You see Autumn or rather the Fall season signals the coming Open Enrollment period for Government run Exchanges so the proponents of the ACA, which includes most of the Media, many Think Tanks and Foundations and all Democrats work to sell the Government run program to our citizens.

How do they do that? They start with some statistics reported in a manner that supports their position even if it requires a skewing of the facts, which we’ve witnessed in the past. As your humble author has written before, the media has often delivered a biased lopsided view of the current status of the health plans that we all require. They write of Out of Pocket costs, of higher deductibles, of pre-existing conditions, of premium increases, of provider access and even lack of choices in a manner that suits their agenda.

Which is to scare the common sense out of people so that single-payer government-run healthcare sounds like a good idea.

Recent reports are cheering the modest increases in premiums this Fall. For example, Covered California is bragging that the premiums for SHOP, the exchange for small employers, are increasing only 8.3%. We’ve discussed this issue before and revealed the real facts concerning the status of premiums.

First, what other good or service in your life is increasing its cost by 8.3% this year. And, if it did, would you be satisfied with the benefit of that good or service?

Second, the 8.3% increase is multiplied times a rate that has already been increased by as much as 300% over the past 7 years. We’ve discussed the impact of compound interest before, haven’t we?

But, proponents (Democrats and media) have to try to sell their product and to do so requires a real “sales job”.

Another set of facts released deal with the increase in “plan deductible”. The data clearly shows that the deductibles we have on our plans has been steadily increasing. For Employer sponsored plans statistics reveal that:

  • 85% of members have a deductible on their plan
    (10 years ago it was 59%. In 2000 it was less that 25%)
  • the average plan deductible selected by applicants is $1573 up from $1505 a year ago. That’s a 5% increase in deductible in addition to increased premium.
  • 25% of Employer plans offer a deductible of $2,000 or higher.
    (These employers need to add an HRA for their EEs)
  • Plan deductible is just a portion of Out of Pocket costs which is an issue for many and we’ve discussed in many Posts.

What do all of these statistics have in common? They are driven by increasing premiums which is the predictable outcome of an overly regulated government-run healthcare system.

As we’ve discussed before 152 million Americans (close to 60%)  get their health plan from their Employer. So, we should ask a few questions in order to maintain a solid fact-based rational for this mess.

  • Q: Why do Employers spend any money to provide a health plan?
    A: To attract and maintain a competitive workforce.
  • Q: Do Employers want to offer a health plan with huge OOP?
    A: No, they want to provide the richest plan possible.
  • Q: What is the primary reason driving Employers to provide plans with higher deductibles and OOP?
    A: Premium costs! Employer premium costs have tripled in past 7 years!
  • Q: Would Employers offer richer plans if they were affordable?
    A: Absolutely, they want to retain the best workforce possible and rich benefit plans help assure that goal!

Remember, current data shows that there are more open jobs available than people seeking a job. That means competition for employees.

Sometimes, I wonder why an Employer would purchase its group benefit plan through a Government run Exchange. There are probably a couple of reasons.
The Employer:

  • May believe it is too small to get a private group plan.
  • May not be able to meet participation  guidelines of private plans.
  • May not have a good insurance broker to guide it.
  • May be uninformed or mis-led to believe an Exchange is the only option.

Almost anything can be packaged and promoted to sound appealing.
For example: let’s say that you are selling cars but only offer your cars in the color white. However, your competitors offer cars in many different colors including white. Would you need to promote your cars in a manner that made potential customers think that your cars in white were better than the competitors cars in various colors?
Of course you would or else you go out of business.
However, if you were being subsidized by the government then you could say almost anything to compete.

We’ve discussed in previous Posts that the media will be increasingly bold in its attacks on pre-ex, premium leveling off, OOP on plans as well as unexpected OOP, choice and many other areas to support candidates in the mid-terms coming in November. We need to continue to be aware and make others aware so that these scare tactics do not work!

That’s why we’re all in this together! To help one another.

Until next week.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf
It means “Walk the Faith”.