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

A study by Express Scripts shows that specialty drugs make up less than 1% of prescriptions, yet account for  28% of U.S. drug spending. The costs of those drugs rose 14.1% last year. In other news, a brand name drug that cost $100 in 2008 cost $197 today, according to Express Scripts.

Bloomberg reports that the HealthCare.gov web site was hacked in July, discovered August 25th, but according to CMS it appears that no personal data was taken. Yes, we believe that and that the IRS cannot find any old emails.

The Alaska Division of Insurance has approved the Blue Cross request to increase individual rates for metallic exchange  plans for 7,000 people  by an average of 37.3% due to poor claims experience for those enrolling. Really? Who would have expected that? Nine out of 10 Wellpoint  and Blues plans that led their markets last year in the exchanges are raising their rates by at least 9%. PreferredOne Insurance Company had the lowest rates in the Minnesota exchange market and had 59% of the enrollees (BCBS was next with 23%). Since  PreferredOne underrated the  plans they were asking for large rate increases from the Department of Insurance. When not granted, they pulled out of the market for the coming year.

More mergers are taking place on the hospital scene. In the Chicago Metro area, Alexian Brothers is merging with Adventist and Northwestern with Cadence and Advocate with Northshore Health Partners. All this is giving the hospitals even more leverage to ratchet up costs and power over insurance companies and networks…a big reason why employers should start seriously looking at the Cost Plus alternative, even if their brokers aren’t.

Kaiser finds that in 2014 the average family premium increased by 3% to $16,824 in a survey of more than 2,000 employers. Single coverage premium  increased  by 2.4% to $6,025. They are attributing the smaller increases to a surge in high deductible plans being offered (20% of plans surveyed have high deductibles).The average single deductible was $1,217.

As of January 1, 2015, non-grandfathered plans must change to out of pockets of no greater than $6,600 per member and $13,200 per family when the new plan year begins. For HSA plans the maximum out of pockets will be $6,450 individual and $12,900 family. The minimum deductibles for HSA plans will be $1,300 single and $2,600 for family coverage.

A Harris survey reports that  46% of those who remain uninsured say they have not heard of the law’s individual mandate and 43% have not heard of the exchanges and 44% are between the ages of 18 and 34. Apparently, ignorance is bliss. Eleven percent said they did not get insurance because it was too expensive and 27% thought that paying the penalty would cost them less than the insurance cost (good guess).

Towers Watson reports that roughly half of large U.S. employers will hit the Obamacare 40%  excise tax targets in 2018. That tax could amount to a liability of $79 billion between 2018 and 2023 according to the CBO.

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Consumer Watchdog has filed lawsuits in California against Cigna and Blue Shield of CA, saying that the companies were involved in a “bait and switch” scheme by not advertising that they were only offering narrow networks. The same group has filed a similar lawsuit against California’s Anthem Blue Cross.

A second court ruling, this time in Oklahoma by a U.S. District judge, has stated that subsidies will only be available to those who apply to the exchanges in the 14 states that built their own exchanges and not to those who enrolled in federal exchanges. That is the letter of the law, but another court has ruled differently. Thus, the case will most likely be ultimately decided by the Supreme Court.