S&S Benefits.....Opinion, Hearsay & News Review

At the end of the 2012 tax year employers with over 250 employees will be required to report the cost of health care on employee W-2 forms (Box 12) as part of Obamacare. Those with less than 250 employees are not required to comply until the IRS issues further guidance. For self-funded plans, employers can use the COBRA premium rates. Both employer and employee contributions are included for all family members covered. The amount does not include amounts contributed to an HSA account.

Health Care Service Corporation (Blue Cross IL, TX, NM, OK) is poised to post $1Billion in profits for 2011. The company writes nearly 55% of the health insurance in Illinois. The profits become despite a 28% decline in net income to $212 million in the third quarter.

Guardian Insurance will no longer be selling Long Term Care insurance after 2011.

Kaiser Health News reports that even if insurer's loss ratios are greater than the 80%- 85% thresholds as part of Obamacare, they still must explain to consumers and policyholders as to how their premium dollars are spent. Insurers who have loss ratios better than the thresholds must issue rebates to policyholders and explain why. HHS is also phasing out allowances for mini-med plans and by 2014, those plans will have to meet the same standards as comprehensive plans, basically insuring their demise.

Fourteen disability insurers participated in the 2011Council for Disability Awareness Long Term Disability survey. They paid $8.3 billion in disability claims on approximately 587,000 disabled individuals (or  $14,140 a year per disabled person). Seventy-two percent of those who were disabled qualified for Social Security Disability payments. The top five causes of disability in order were: Musculoskeletal system and connective tissue diseases (27.5%), cancer (14.6%), injuries or poisoning (10.3%), cardiovascular or circulatory disease (9.1%) and mental disorders (9.1%).

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Aetna has sued Blue Cross Blue Shield of Michigan for allegedly paying hospitals to charge other insurers up to 39% more for services than they charged Blue Cross. It is reported that the lawsuit is a piggyback on the fall 2010 suit by the US Justice Department and former Michigan Attorney Mike Cox that accuses the Blues of using special hospital contracts and most favored nation clauses to stifle competition and drive up rates. The Blues have 60% of the health insurance market in Michigan.

Delphi Financial Group that owns Reliance Standard Life Insurance Company has been purchased by Japan based Tokio Marine Holdings, a leading global insurer.

In the next 14 months, seven of the world's 20 best selling drugs will be going generic, including the top 2, Lipitor and Plavix. Between now and 2016, $255 billion dollars in drugs will go off patent. Last year the average generic prescription cost $72, versus $198 for the average brand name drug.

The Self insurance Institute of America (SIIA) has announced it has filed a complaint in Federal Court in Detroit that Michigan's recently passed Health Insurance Claims Assessment Act is preempted by ERISA. That act creates a 1% medical claims assessment, effective January 1, 2012, imposed on claims paid for Michigan employees.