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

Assurant Benefits (formerly Fortis) and Aetna are entering into a joint dental PPO network access and servicing arrangement.

HealthLeaders-Interstudy’s annual survey shows that HMOs account for 25% of the health insurance market and that 74 million people were in HMOs in 2006. That’s up from 67.7 million people and 23% of the market in 2005. States with the highest HMO market penetration are California at 49.5%, Massachusetts at 43.4% and New York at 28%. Texas and North Carolina have the lowest penetration rates of 12.8% and 10.2% respectively.

HCC Life is acquiring the Allianz Life stop loss business and will have an estimated $930 million in annual premiums including the $180 million from Allianz. Although figures are sketchy as to the total amount of stop loss premium in the market, it is estimated that HCC will have from 20% to 30% market penetration after the acquisition.

California ’s small business (2 to 50 employee groups) insurance advocate group is shutting down. From a high of ten participating insurers in 1994, the group carriers involved had shrunk to three before Blue Cross of California pulled out and unraveled the coalition. The non-profit has stopped enrolling new groups and coverage for the existing 116,000 members will cease on December 31, 2006.

The IRS has issued new regulations effective January 1, 2007, that exempt employers from having to make comparable contributions to HSAs for collectively bargained employees compared to non-bargaining employees. In addition, the new regulations expand categories to self, self plus one, self plus two and self plus three or more. The old rules only recognized self coverage and self plus family coverage.

Almost half (48%) of middle income families with $35,000 to $50,000 in annual income report serious problems paying for health care and health insurance according to the Commonwealth Fund. One-third of adults with household incomes between $50K and $75K and one-fifth of those with incomes over $75K report the same. In the same study, 42% of the people surveyed reported experiencing problems with the quality of their health care and 25% of adults said their physicians recommended unnecessary treatment.

Cancer is the top reason (12%) for LTD claims according to a UnumProvident report on disability claims. Normal pregnancy (18%) is the top reason for STD claims.

Fort Dearborn Life Insurance has acquired the Life and LTD business of HM Life Insurance (formerly Highmark).

President Bush has signed an executive order that requires the HHS, Dept. of Defense, Dept. of Veteran Affairs and the Office or Personnel Management to collect more information about the quality and cost of health care and share that information with the private sector. The agencies are to work together to identify practices to promote high quality health care and are required to compile information on cost beginning January 1, 1007.

A Destiny survey of 1,000 adult Americans states that only 10% of adults would be extremely likely to shop for medical services if they could obtain information on prices and quality. Another 29% indicated they would be very likely to do the shopping. The survey found that Americans spent about 20 days researching their last major household purchase, but 9.7 days to select a doctor. A Thomson-Medstat study found that more than 75% of obese Americans say they eat healthy and about 40% say they engage in vigorous exercise. Only 3.6% say they super size fast food purchases and 43.1% say they don’t eat fast food on a weekly basis.

The University of Chicago Hospitals and Humana announced an agreement to have the hospitals and associated physician groups join Humana’s network beginning on September 1^st.

The Segal survey of projected trends for 2007 from the insurance market places PPO trend at 11.6%, POS trend at 11%, HMO trend at 11.1% and HDHP plans at 12%. If Rx is included in the plans, trend is one-tenth higher. Stand alone Rx is projected at 11.9% for retail and 11.5% for mail-order. Dental PPO trend is projected at 6.2% and Dental Indemnity is at 7.5% with DMO trend at 5.2%. The Segal survey of HDHP plans was also conducted and of the 81 employers of 500 employees and up, 90% offered CDHPs as an option, but only half help fund HSAs. A majority said it was too early to tell in the CDHP was successful in cutting costs.