Benefits.....Opinion, Hearsay & News Review
The WSJ reports that in 9 of 10
states that have filed their proposed 2015 Obamacare rates, the largest insurers
are increasing premiums between 8.5% and 22.8%. The rates reflect medical
inflation, PPACA fees and coverage mandates. Florida Blue, the stateís largest
health insurer, is increasing premiums by an average of 17.6% for its PPACA
plans in 2015.
A new study from the American
Health Policy Institute said that employers in 2012 spent $3,430 per covered
life, up 13.6% from 2003 after adjusting for inflation. For large employers
(over 1000 employees) the figure was $4,990 per covered life. Federal and state
governments spent $9,130 per covered life in 2012, with Medicare leading the way
at $10,830, up 28.2% since 2003.
A class action lawsuit in
California accuses Blue Cross of misrepresenting the size of its networks on
PPACA plans, plus concealing that out of pockets and deductibles were much
higher for out of network utilization. They are probably not the only carrier
that could be accused.
According to the Aflac
Workforces Report for Small Business released in July, only 12% of small
business employees say they are extremely satisfied with their benefits.
On the same day, one court in
Washington, D.C. and one in Richmond, Virginia reached totally different
conclusions on Obamacare. The D.C. court said that the law specifically excluded
subsidies for Obamacare enrollees in states that did not form their own
exchanges. The other court held the opposite and went with the IRS
interpretation of the law (which ignores the law as written). The settlement of
the issue was expected to be expedited to the U.S. Supreme Court, but now
administration officials are appealing to the whole D.C. Court of Appeals to
reverse the 3 judge panel that ruled on the law. That is because Obama has
packed the full court with his appointees (7-4) and the administration does not
wish to risk the case before the full Supreme Court.
A survey by the Agency for
Healthcare Research and Quality found that just 16.6% of
employees taking single coverage from their employers no longer pay for single
coverage. Only 6.9% of EE+1 and 7.9% of Family enrollees donít pay for
coverage. The average total premiums were $5,571 single, $10,990 EE+1 and
$16,029 in 2013. Employees who contributed paid
an average contribution of $1,170 single, $2,940 EE+1 and $4,421 family.
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According to CMS, 6.8 million
consumers were to receive an average rebate of $80 ($330 million) by the
deadline of August 1, 2014 due to the Medical Loss Ratio Rule where insurance
expenses and profits cannot exceed 20% (small group and individual policies) or
15% (large group) of premiums.
A listing of PPACA exchange
grants released by the Congressional Research Service shows that over $4.8
Billion dollars were granted to states for their exchanges for the 5.4 million
enrolled, for a cost of $895 per enrollee, of which 87% (4.7 million enrollees)
received an average subsidy of $246 per month. That brings the subsidy cost to
$13.9 billion in addition to the $4.8 billion to enroll the people, for a
taxpayer spend of approximately $19 billion for the first year of the exchanges.
Welcome to the welfare state.
The IRS has adjusted for
inflation the maximum an employee can spend of household income in order for
coverage to be affordable to be 9.56% of household income, as compared to 9.5%
A recent issue of a major
insurance publication highlighted the growth of CDHP/ high deductible plans from
1 million enrollees in 2005 up to 17 million enrollees in 2014, or 12.4% of
enrollment in medical insurance plans. While touting the cost cutting nature of
the plans (employer costs possibly, but not employee), the articles touted
wellness and decision making tools to help employees gauge the average cost of
charges from various providers. There was hardly any recognition that providers
do not provide their actual charges, for fear of revealing what discounts they
grant any one insurance carrier. Employees would find it impossible to come
close to knowing the cost of anything but the most benign pre-planned outpatient
procedure. None of these measures address actual cost. The carriers are invested
in their networks. They all claim they save more than the next. Itís all a
shell game. The majority of brokers/consultants (especially the larger houses)
endorse the shell game for the sake of their overrides instead of solutions for
their clients. Reference based pricing and Cost Plus solutions as proposed by
leaders such as ELAP will make a difference. Not the pabulum spewed in most of
the insurance industry press. If you want to learn more, call.