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

Advocate was thinking about merging with Rockford , IL Health System, but the letter of intent has expired. They have, however, agreed to a new letter of intent to explore “clinical alignment and shared services.” Advocate has signed a second letter of intent formalizing negotiations with BroMenn Healthcare System in Normal and Eureka , IL.

According to Employee Benefit News, HR outsourcing is on the decline due to the economic conditions of the country. Makes one wonder why anyone was doing it if it was not economically feasible.

Once again, a J.D. Powers & Associates survey says that the majority of employees do not understand their health plan. The survey covered 33,000 members in 131 plans in 17 regions. Only 1/3 of employees surveyed say that they understand their health plan. From the land of Blago, that actually seems pretty good compared to the voting population understanding what candidates stand for. Congrats to HR for doing a better job than the news media!

ING has been cutting back on employment in its insurance operations as a direct result of turmoil in its banking operations that have resulted in huge losses. They plan to manage banking and insurance operations separately and according to an announcement, they plan to divest U.S. insurance activities such as group reinsurance.

Wellpoint has agreed to sell its Rx operations to Express Scripts for $4.675 billion. The transaction includes a 10 year agreement for Express Scripts  to manage Rx service for Wellpoint (which includes Unicare and Anthem plans). Get ready for the fallout as the plans make the transition. Express Scripts has not exactly been known for their service in previous acquisitions. The transaction will close in the second half of 2009, and then let the chaos begin!

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EBA surveyed benefit managers, advisers and other related professionals if company CEOs, CFOs and other executives are sold on wellness programs. 20.8% were, 17.9% were skeptical, 56.4% believe it’s 50/50 and 5% have some other opinion (although we are not sure exactly what that could be).

A survey of 300 employers by Aon showed that 60% of employers expect their overall healthcare costs to increase due to the COBRA subsidy. Apparently 40% of surveyed employers are kidding themselves? COBRA costs usually range from 140% to 160% of COBRA premium with 5%-10% of former employees enrolling. The survey said that employers expect enrollment in COBRA to increase by 14% to 18%.

A multi-year study published by the Journal of Occupational and Environmental Medicine of 150,000 workers found that presenteeism (at work, but unable to perform at full capacity) creates a greater drain on company productivity than employee absence. How do they measure this stuff? The study went on to say that when productivity losses are factored in with medical and drug costs, the five costliest conditions for employers are depression, obesity, arthritis, back/neck pain and anxiety.

The Association of Health Insurance Advisors has announced that they oppose a government sponsored health plan as an option under health care reform. They view that option as a slide toward a single payer system that would feature rationing as a method of cost control.

Milliman 2008 Health Insurance Survey: Anticipated 1/09 rate increase was 12.1% PPO, 10.7% high deductible PPO, 8.4% HMO. PerMemberPerMonth (not employee) average premium in 2008: $350 HMO, $355 PPO includes PMPM drug cost of $49 HMO, $50 PPO. 2007 profitability for HMO and PPO was 2.6%. The average savings from a$250 deductible plan to a $1,000 deductible plan was 11.8%. To go from a $250 deductible to a $2,000 deductible the savings average was 20.2%.