The 12 Days of Obamacare

The 12 Days of Obamacare

On the first day of Obamacare,
The President sent to me
And a web site that didn’t even work.

On the second day of Obamacare,
The President sent to me,
Two stinking lies,
And a web site that didn’t even work.

On the third day of Obamacare,
The President sent to me,
Three times the cost,
Two stinking lies,
And a web site that didn’t even work..

On the fourth  day of Obamacare,
The President sent to me,
Four new mandates,
Three times the cost,
Two stinking lies,
And a web site that didn’t even work..

On the fifth day of Obamacare,
The President sent to me
Five million cancelled,
Four new mandates,
Three times the cost,
Two stinking lies,
And a web site that didn’t even work..

On the sixth day of Obamacare,
The President sent to me
Six worthless benefits ,
Five million cancelled,
Four new mandates,
Three times the cost,
Two stinking lies,
And a web site that didn’t even work..

On the seventh day of Obamacare,
The President sent to me
Seven times the headaches,
Six worthless benefits ,
Five million cancelled,
Four new mandates,
Three times the cost,
Two stinking lies,
And a web site that didn’t even work..

On the eighth day of Obamacare,
The President sent to me
Eight years of chaos,
Seven times the headaches,
Six worthless benefits ,
Five million cancelled,
Four new mandates,
Three times the cost,
Two stinking lies,
And a web site that didn’t even work.

On the ninth day of Obamacare,
The President sent to me
Nine huge new taxes,
Eight years of chaos,
Seven times the headaches,
Six worthless benefits ,
Five million cancelled,
Four new mandates,
Three times the cost,
Two stinking lies,
And a web site that didn’t even work.

On the tenth day of Obamacare,
The President sent to me
Ten new departments,
Nine huge new taxes,
Eight years of chaos,
Seven times the headaches,
Six worthless benefits ,
Five million cancelled,
Four new mandates,
Three times the cost,
Two stinking lies,
And a web site that didn’t even work..

On the eleventh day of Obamacare,
The President sent to me
Eleven employers dropping,
Ten new departments,
Nine huge new taxes,
Eight years of chaos,
Seven times the headaches,
Six worthless benefits ,
Five million cancelled,
Four new mandates,
Three times the cost,
Two stinking lies,
And a web site that didn’t even work..

On the twelfth day of Obamacare,
The President sent to me
Twelve docs retiring,
Eleven employers dropping,
Ten new departments,
Nine huge new taxes,
Eight years of chaos,
Seven times the headaches,
Six worthless benefits ,
Five million cancelled,
Four new mandates,
Three times the cost,
Two stinking lies,
And a web site that didn’t even work..

Why Does the ACA need young people??

I have stayed away from the political rhetoric that has surrounded the Affordable Care Act since the inception of this blog.  Obviously, I have my opinions, but I feel that my role is to relay information, for the most part, not my own views. While I have not been overly impressed with the execution and implementation of this law, I have remained hopeful that some positive things will occur due to the exercise that we are currently enduring.  With each reactionary change, and distortion of facts that occur the less hopeful I become.

The latest news that really disturbs me is the “rap” music ad aimed at inspiring young people to enroll in the exchanges. I wish them well with that endeavor, but it just ain’t gonna happen, rap music or not.  The young people between the ages of 27 and 34 who have never had to purchase health insurance before will not see the value proposition in a Bronze level plan through an exchange with the premiums I have seen listed and the out of pocket costs associated with those particular plans.

Using the premium calculator on the Kynect website, a 30 year old person living in Jefferson County with an income of $35,000 per year would pay $182.30 per month for a Bronze Level plan. Due to the income level, they would not be eligible for a subsidy.  This means that the policy holder would be responsible for 40% of all medical spending out of their own pocket.  Conversely, under the current environment that same 30 year old, provided that they were in reasonably good health, would likely be paying a premium of around $90 per month on a plan that would cover about 80% of all medical spending for the calendar year.  The economics don’t seem to work.

The Exchanges need the young people, in fact, they must have them participate or the assumptions that were made about the financial viability of this entire plan are in jeopardy. The numbers were based on the young people signing up and paying premiums.  The government is not shy about the fact that younger healthier people will pay a little more under the ACA, in order to offset the older, less healthy individuals who may end up paying less for health insurance.  Subsidy of rates have always been a part of insurance premiums, even today, pre ACA the younger, healthier policy holders pay more premium than they should and the older, sicker people pay less than they need to in order to cover the true costs associated with being covered.  However, the spread between the lowest available rate and the highest available rate has been compressed under the ACA.  The result of that compression is that it pulls the bottom of the charts up and brings the top of the charts, from a rating perspective, down. 

Young people today are just not willing to pay $2184 per year for a health plan that could potentially cost them an additional $11,000 more in deductibles and co-insurance when the penalty is just $95 or 1% of your income, which ever is higher.  So for our 30 year old, the penalty for not having health insurance would be $350 for the year.  That is less than 2 months worth of premium payments.

I want to be clear that I am not advocating that young people refrain from purchasing health insurance.  I think that everyone should be insured, as it is the responsible thing to do.  What I am saying is that the system that has been developed and the pricing that is out in the marketplace will make this a very hard sell. 

For you small to mid size employers out there, the last thing you need to think about is dropping your employee health insurance plan.  This is your opportunity to be the hero and provide your employees with one less thing to worry about.  We can assist you in making critical decisions regarding your employee benefit programs and their effect on your bottom line.  Logan Lavelle Hunt is ready to take your calls and inquiries right now.  Contact us for a no obligation review of your plan today.

In Peace,

Steve

Taking the Easy Way Out this week!

Well, there is too much changing for me to go out on a limb and try to tell you what the ACA is going to do this week, so I decided to take the easy way out and just pass along some information about the Essential health benefits required by the act.  I have to credit my friends at Anthem/Wellpoint for this summary that they provided me.  This is still accurate as far as I know.  Good luck out there, and if you need assistance, make sure to go to our website www.llhins.com We are ready to offer assistance.

Essential health benefits (EHBs)           

Summary

On February 20, 2013, new rules was released by the Centers of Medicare & Medicaid Services (CMS), the Department of Health and Human Services (HHS) and Department of Labor ( DOL)

Effective for new and renewing plans on and after January 1, 2014, all non -grandfathered, fully insured small group and individual health plans must cover essential health benefits (EHBs).

Also effective for new and renewing plans on and after January 1, 2014, all health plans, regardless of group size or funding type, must apply all member cost share for in-network services and out-of-network emergency services to the in-network out-of- pocket (OOP) maximum, which cannot exceed $6,350/$12,700.

All copayments, coinsurance and deductible amounts for EHBs must apply to the out -of-pocket maximum. No annual or lifetime dollar limits are allowed on EHBs, but other types of limits can be put in place including,

·        visit limits (e.g., 20 visits per CY)

·        day limits (e.g., 30 days per lifetime)

·        occurrence limits (e.g., 1 wig per CY)

·        per episode or per service limits (e.g.,$1,500 per hearing aid) 

Definitions

Essential health benefits (or EHB) package: the covered benefits and related limits of a health plan offered by an issuer based on the EHB-benchmark plan; provides at least the  ten statutory categories of benefits, limits cost sharing for such coverage, subject to offering catastrophic                                                                  .

·        Base-benchmark plan: the plan selected by a state from (or through the default process) before adjustments are made to meet the benchmark standards. (Details can be found in the Code of Federal Regulations §156.110.)

·        EHB-benchmark plan: the standardized set of EHBs that must be included in all non-grandfathered, fully-insured small group and individual health plans beginning in 2014.

State selection: serves as a reference plan and reflects the services and related limits offered by a typical employer plan in that state; applies to at least 2014 and 2015 benefit years.

Default base-benchmark plan: states that did not make a benchmark plan selection defaulted to the plan with the most

Final rule: EHB package

EHB-benchmark must provide coverage of at least the following categories of benefits:

1.    Ambulatory patient services

2.    Emergency services

3.    Hospitalization

4.    Maternity and newborn care

5.    Mental health and substance use disorder services, including behavioral health treatment

6.    Prescription drugs

·        Must cover the greater of either one drug in every United States Pharmacopeia (USP) category and class, or the same number of prescription drugs in each category and class as the EHB -benchmark plan

·        Must have procedures in place that allow a member to request clinically appropriate drugs not covered by the health plan

·        Does not require coverage of all drugs in protected classes as defined in Medicare Part D

7.    Rehabilitative and habilitative services and devices

·        The final rule allows states with benchmark plans that do not include coverage for habilitative services to determine which services are included in that category.

·        States that decline to specify habilitative services are required to either provide parity by covering habilitative services benefits that are similar in scope, amount and duration to benefits covered for rehabilitative services, or is determined by the issuer and reported to HHS.

8.    Laboratory services

        9.    Preventive and wellness services and chronic disease management
     10.  Pediatric services, including oral and vision care

·        Pediatric services means services for individuals under the age of 19

·        Benchmark plans that do not provide coverage  for pediatric oral and vision services are required to cover these services from one of the following:

·        The Federal Employees Dental and Vision Insurance  Program (FEDVIP) with the largest enrollment (CHIP) 

Large group and self-funded (ASO) health plans do not need to offer all 10 categories of essential health benefits, or meet actuarial value requirements that non-grandfathered small group and individual policies have to meet. The rule is still important to large group and self-funded (ASO) plans because they are subject to many rules tied to EHBs such as:

·        The out-of-pocket maximum applies to EHBs
·        EHBs covered by a large group or self-funded (ASO) plan cannot have annual or lifetime dollar limits

 

Credit Anthem Blue Cross Blue Shield for content