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NEW YEAR’S HEALTH INSURANCE TIPS FOR 2011

Market Wire –

Dec. 16: Mountain View, CA – The leading online source of health insurance for individuals, families and small businesses, released a series of tips to help health insurance consumers find affordable coverage and get the most for their health insurance dollars in 2011.

In 2010, families with employer-based health insurance saw a 14% average increase in coverage costs compared to 2009(1). Those who went through their employer’s open-enrollment period at the end of 2010 on ‘auto-pilot’ (without paying careful attention to their choices) may find that their current health plan is simply unaffordable when new rates take effect in January 2011.

Others who do have the right health plan for their needs may not know how to best take advantage of their coverage in order to save money over the course of the year.

Five Health Insurance Tips for 2011:

1.  Don’t get stuck with a lemon. Lots of health insurance companies make changes to rates and benefits at the beginning of the new year. By mid to late January, you may be getting your first taste of what these changes mean for you and your family. If employer-based health insurance is no longer affordable, check with your Human Resources department and get to know your options in the non-group market. Keep in mind, however, that until 2014 you may still be turned down for individual and family coverage due to a pre-existing medical condition.

2.  Check out new health reform-compliant plans. Health insurance companies are introducing new plans to comply with health reform rules that make some preventive care free and do away with lifetime coverage limits. Some older plans may not have to meet these requirements. If you want to take advantage of new health reform protections, work with a licensed online agent.

3.  Be sure your old plan still fits
. Like old cars or houses, an old health plan can feel pretty comfortable, but that doesn’t mean it’s still a good match for you and your family. If you were married or divorced, had children, or gained or lost income this past year, you may be able to save money on medical costs by starting the year with a plan better suited to your needs.

4.  Don’t pay two deductibles. Many health insurance plans come with calendar-year deductibles. If you’re planning a move or other life changes in 2011 and know you’ll have to switch health insurance plans mid-year, it may be smarter to find a new plan early. Since certain medical claims are only paid by the insurance company after the deductible is met, moving to a new health insurance plan in January or February may help you avoid paying deductibles twice in a single year.

5.  Fund your HSA early. If you have a Health Savings Account (HSA) and want to get the most out of it, fund it to the maximum amount early in the year. That will allow you to use pre-tax dollars for copayments and deductibles while allowing unused money to collect interest for more of the year. Also, remember that in 2011, HSA (and FSA) funds can no longer be used to pay for most over-the-counter medications.

NOTE: Keep in mind that when you switch plans or apply for a new individual or family health insurance plan, you may be subject to medical underwriting. If you have an individual or family plan and developed medical conditions recently, you may need to stay on that plan to keep your coverage secured.

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CALIFORNIA HEALTH INSURERS CITE RISING HOSPITAL COSTS

The Sacramento Bee –

Dec. 10: As health insurers again increase premiums on thousands of subscribers, the industry is seeking to shift the debate over escalating health care costs to the rising price of hospital care.

In California, hospital prices jumped 150 percent since 2000, according to a study of state hospital data conducted by America’s Health Insurance Plans, the industry’s trade association.

“What this data shows is that there needs to be much greater focus on the underlying cost of medical care that is driving those premium increases,” said Robert Zirkelbach, a spokesman for the group.

“At some point, people will have to address these underlying cost drivers if health care costs are going to come down.”

To gauge prices, AHIP used inpatient revenue self- reported by California hospitals to the Office of Statewide Health Planning and Development.

In California, the prices charged to commercial health plans rose by 159 percent from 2000-2009 — more than twice the rate of increase for Medicare, which serves mostly seniors, and more than eight times that for Medi-Cal, the government insurance program for the poor.

“The report’s focus on California hospital costs just reinforces what we have been saying the past couple of years. Steep increases in medical costs must be addressed. Our country and state cannot sustain this kind of growth,” said Patrick Johnston, president of California Association of Health Plans.

The health insurers’ group acknowledged the challenges faced by hospitals and other medical providers as they provide free care to those without insurance or those too poor to pay.

Meager reimbursements from governme nt insurance programs such as Medi-Cal and Medicare haven’t helped hospitals’ bottom lines. As a result, hospitals make up lost revenue by shifting costs to patients with private insurance.

Insurance companies say they are merely passing on those increased costs to
their customers. But a group representing hospitals criticized the insurance industry study as a political attempt to shift blame for rising insurance rates. “It’s the continuing saga of AHIP pointing fingers at the hospital industry.

It’s really tough for a pot to call a kettle black,” said Scott Seamons, regional vice president for the Hospital Council of Northern and Central California. “I don’t know what their objective is here, but it smells,” he said.

For years, the insurance industry has been under scrutiny for surges in premiums and has fought a losing battle to garner sympathy from the public and policymakers.

“Unfortunately, for political reasons, people have been reluctant to address underlying medical costs and focus only on insurance premiums,” Zirkelbach said.

It’s easy to see why insurers have been under fire, particularly among the millions of Americans who buy health coverage on their own.

While insurance premiums are expected to rise by an average of 9 percent next year, rates for people buying coverage in the individual market are seeing steeper increases. Those customers are also paying higher deductibles.

Jamie Court, president of Consumer Watchdog, a left-leaning advocacy group based in Santa Monica, accused insurers of attempting to sow confusion expressing concern about rising costs while simultaneously increasing premiums.

“It’s been very clear to us that insurance companies have been scapegoating the president’s health insurance reform plan for everything that is wrong with health care in this country and using it as an excuse to raise premiums,” Court said. “Consumers have been left in a lurch.”

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SOME HEALTH INSURERS RAISING RATES AGAIN

 
San Francisco Chronicle –

Dec. 9: Some health insurers are bumping up rates yet again to reflect changes mandated by the new federal health overhaul law as well as state reforms that will go into effect Jan. 1.

Blue Shield of California, for example, has sent letters informing customers with individual policies that their premiums will go up in the low single digits because of the federal law.

Some of those same policyholders also could see their rates go up as much as an additional 17.7 percent to account for a new state law that will prohibit insurers from charging women more for insurance than men.

For consumers, many of whom already have been hit this year with hefty premium increases to accommodate higher medical costs, the additional raise attributed to health reform will further strain their budgets.

Scott Morgan, a Blue Shield customer in San Francisco, saw his premium rise by 29 percent in June, so he was stunned to get another rate increase, this time for 34 percent. That means the same coverage he was paying $335 a month for at the end of May will cost him $581 a month come January.

“The federal reform is going to add 3.4 percent. That’s fair. But do I believe that means my rates should go up another 30 percent above that?” said Morgan, 52, a self-employed consultant for corporate meetings. “I think what they’re doing is they’re getting their licks in while they can.”

Since the federal health care overhaul legislation was passed in March, several provisions have taken effect, including the elimination of lifetime and some annual coverage limits. Children are allowed to stay on their parents’ health policies until the age of 26 and insurers can no longer deny coverage to children with pre-existing health conditions.

‘Gender rating’

Starting next year, insurers in the individual and small group markets will be required to spend at least 80 percent of their premium dollars on medical care, while those covering large groups will have to spend a minimum of 85 percent on those purposes.

On the state level, a law taking effect Jan. 1 will ban the practice known as “gender rating,” in which women were typically charged more than men for health insurance. While women tend to use more services in their younger years, the difference often evens out as people age.

“The new federal law that applies to policies written after Oct. 1 does incur costs,” said Patrick Johnston, president and chief executive officer of the California Association of Health Plans, the trade group for the state’s insurers. “Those are in the range of 3 percent to 10 percent, varying with the policy and the purchaser.”

Blue Shield has calculated the reforms under the federal health law will require premiums to go up more than 4 percent for some policies.

About 80 percent of Blue Shield’s 340,000 individual policyholders are getting a rate change effective Jan. 1 – and about a third of those members already had a change in October, said Tom Epstein, a vice president with the San Francisco health insurer. While the vast majority will get an increase, some will actually see their rates cut, he said.

“We do not expect to make any money in the individual market this year, despite these rate increases,” he said.

Unfair justification

Consumer groups say it’s unfair to use health reform to justify rate increases.

“These types of rate increases have been happening for years now,” said Sondra Roberto, staff attorney with Consumers Union. “We really need more scrutiny in how they’re coming up with these rate increases.”

Premium increases proposed this year by Anthem Blue Cross of as much as 39 percent in the California individual market not only jumpstarted the debate over the federal health law but also prompted increased scrutiny by state regulators as well as a new state law designed to add a layer of consumer protection.

In addition, federal regulators have called for state and federal reviews of “unreasonable” rate increases, but have yet to define what such an increase is.

“Beyond unaffordable” is how another Blue Shield customer, Terry Seligman, described the 4.83 percent rate increase she will have to pay on Jan. 1, which comes on top of the 13 percent hike she’s paid since Oct. 1. The combined increases reflect a jump in premiums of nearly 19 percent since Sept. 30.

“I never thought I’d be happy to say this, but next year I’ll be on Medicare,” said Seligman, 64, who runs a travel insurance business in San Francisco and has been a Blue Shield customer for 26 years. “And not a moment too soon.”

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Sen. Tom Coburn: Why the New Health Law Could Decrease Competition & Increase Costs | Health Reform Report

Supporters of the Patient Protection and Affordable Care Act argued before the passage of the new law that health care in America needed more “choice and competition.” So they may be surprised to learn the massive overhaul actually could decrease choice and competition.  In fact, an accumulating body of data shows the new law is on track to actually reduce competition between health care providers, which will increase health costs for patients. There are good reasons for concern.

An implicit pledge of the health overhaul is that delivery will be improved through “Accountable Care Organizations.” ACOs are generally envisioned as teams of doctors and nurses share savings in their coordinated effort to deliver higher quality, lower cost health care.  Coordinated care is a great goal, but there are good reasons to be concerned that ACOs will not accomplish. 

First, there is the question of whether or not there will be shared savings. During the past decade, the Medicare program conducted a pilot project in which teams of health care providers could share savings from coordinated care, but only half of the teams in the demo experienced any savings. 

Second, there is the issue of who will share any savings. The health overhaul left in place existing federal restrictions on physician referrals and further barred physicians from having ownership of hospital endeavors. So, unless the rules for ACOs are changed dramatically, ACOs could accelerate the trend of physicians leaving private practice to work in a centralized hospital setting. 

Physicians are already exiting private practice in droves. A recent national survey of more than 2,000 physicians found that more than seven in 10 physicians said they would leave their medical practices for hospital or work-part-time, stop taking new patients, or simply retire altogether.  As a former Medicare official recently noted, “in 2005, more than two-thirds of medical practices were doctor-owned, a share that was largely constant for many years [but] by next year, the share of practices owned by physicians will probably drop below 40 percent, according to data from the Medical Group Management Association.”

At the same time, over the next three years, three in four hospitals or health systems reported they plan on hiring more physicians, and more than half said they will buy entire medical practices  Last year alone, half of new doctors were hired by hospitals.

Respected Harvard health care economist Regina Herzlinger has noted that ACOs hold promise or lead to peril in direct relationship to how they are designed and implemented.  Her conclusions, based on a careful examination of the consolidated health care system in Massachusetts, underline the importance of provider groups of all sizes being enabled to share with patients in any savings.  And, just as important, rather than adopting a one-size-fits-all rules, regulators must adopt a flexible ACO structure that is predictable, yet adaptable.

Many health care providers and policy analysts have offered their prognostications, but Herzlinger’s focus on properly aligning underlying incentives is key.  ACOs could further diminish the quality of patient care if they fail to preserve, and build on, the primacy of the patient-physician relationship.  Unfortunately, the current outlook is not encouraging.

A widely-read recent New York Times article noted “consumer advocates fear that the health care law could worse some of the very problems it was meant to solve -by reducing competition, driving up costs, and creating incentives for doctors and hospitals to stint on care.”  A White House official also recently acknowledged that “the economic forces put in motion by the [health legislation] are likely to lead to vertical organization of providers and accelerate physician employment by hospitals and aggregation into larger physician groups.”

A former Medicare policy advisor said the law assumes “doctors will fold their private offices to become salaried hospital employees, making it easier for the federal government to regulate them and centrally manage the costly medical services they prescribe.”  Certainly, many of the new law’s changes will centralize decisions in Washington, DC, removing power from physicians while dramatically increasing the control of federal bureaucrats and politicians. 

 Economic theory suggests that consolidation of providers under a hospital will increase a hospital system’s market share and negotiating power over remaining providers. As massive hospital systems grow even larger, choice and competition will be reduced in the health care marketplace and costs to consumers will increase even further.

 Such a conclusion is grounded not only in economic theory, but experience. The consolidation of providers is one important reason that health care costs in Massachusetts already are the most expensive in the nation. As the Massachusetts Attorney General concluded in a report earlier this year examining the underlying drivers of health costs, “price variations are correlated to market leverage…of the hospital or provider group compared with other[s] within a geographic region.”

California appears to suffer from a similar problem. The Center for Studying Health System Change studied California’s experience in attempted health reforms and also concluded “proposals to promote integrated care through models such as accountable care organizations could lead to higher rates for private payers.”

And, if these trends were not concerning enough, there is a final wrinkle worth noting. Because the new law cuts nearly $530 billion from Medicare to spend on new programs, some providers are finding their current business model financially unsustainable. 

 Faced with the prospect of shutting its doors or merging with competitors, many health care providers are being consolidated with other types of providers.  The Wall Street Journal recently noted that Moody’s Investors Services informed analysts to “expect consolidation in health industries, as providers acquire different health-care entities to diversify.”  A Deloitte study echoed Moody’s findings, saying “there is considerable [mergers and acquisitions] activity, particularly among those organizations experiencing threats to their reimbursement levels.”  While corporate motives driving these mergers may be benign, the impact on consumers’ wallets will nonetheless be real and potentially significant.

None of these changes are good for consumers, patients, or health care providers. Even supporters of the health care overhaul will be forced to admit the failings of their massive overhaul as costs increase, providers consolidate, and choices for consumers are reduced.  But the likely problems with ACOs are really just a symptom of the larger problem: a massive 2,700 page government-centered approach to health care that fails to fix many of the basic problems and makes some problems even worse.   That is why the best way forward is to repeal the law and replace it with sensible, proven reforms that will reduce costs, increase competition, empower patients, realign incentives, and put federal health spending on a truly sustainable path.   

Tom Coburn, MD is a United States Senator from Oklahoma.

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Workers Get Health Care Allowances

New Laws Give Employees Money to Buy Individual Health Insurance

Park City, UT December 1, 2010

For information contact John Barrett at (626 797-4618  www.healthinsbrokers.com

Zane Benefits, Inc. helps employers take advantage of new IRS laws (Section 125 and Section 105) that allow employers and employees to contribute tax free dollars to individual health insurance costs.    Zane Benefits’ solution involves a switch to employer-funded individual health insurance in which each employee receives a tax-free monthly allowance to purchase their own individual policy.

Individual health insurance used to be expensive and hard to get. However, due to health insurance reforms, individual policies are now more affordable and accessible. For example, insurance companies must now accept children regardless of preexisting conditions, and guaranteed acceptance is being extended to all citizens over the next few years. Additionally, a new federal risk pool is now available for anyone who cannot find health insurance on the individual market.

Many employees are able to buy individual policies for less than the monthly amount funded by the company. The allowance can also be used for eyeglasses, dental care and other medical expenses. Today, there are various ways for all employees to get some kind of health coverage through state and federal programs.

Zane Benefits offers two options (“ZaneHRA” and “ZanePOP”) to employers that want to make the switch to employer-funded individual health insurance.

ZaneHRA, which is a defined contribution health plan, works best for companies that want to offer health benefits, but cannot offer group health insurance due to high cost or participation requirements. With ZaneHRA, employers offer a defined contribution health plan in which they make available monthly contributions (“allowances”) that employees choose how to spend. Employees can use their monthly “ZaneHRA Allowance” to reimburse their individual health insurance costs and eligible medical expenses 100% tax free.

ZanePOP, which is a premium-only-plan for individual health insurance, works best for companies that do not offer health insurance or have employees who are not eligible for a group health insurance plan. With ZanePOP, employers allow employees to reimburse themselves for individual health insurance costs using pre-tax salary. Employees typically save 20-40% on their insurance premiums. Employers save an additional 7.65% in FICA taxes on all reimbursements.

According to Rick Lindquist, who manages Zane Benefits’ affiliate distribution, “an employer can setup a ZaneHRA or ZanePOP plan in 10 minutes online. Once the plan is setup, it takes less than 5 minutes per month to administer because we integrate with the company’s existing payroll service.”

Zane Benefits has built a web-based training program to help insurance agents and CPAs learn the new rules. “Our products are distributed in all 50 states by independent licensed insurance brokers. However, many agents do not realize individual health insurance can be reimbursed tax free. We are working hard to educate brokers on these new products so that they can help their clients.”

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Union Drops Health Coverage for Workers’ Children

By Yuliya Chernova

Associated Press

One of the largest union-administered health-insurance funds in New York is dropping coverage for the children of more than 30,000 low-wage home attendants, union officials said. The union blamed financial problems it said were caused by the state’s health department and new national health-insurance requirements.

The fund is administered by 1199SEIU United Healthcare Workers East, an affiliate of the Service Employees International Union. Union officials said the state compelled the fund to start buying coverage from a third party, which increased premiums by 60%. State health officials denied forcing the union fund to make the switch, saying the fund had been struggling financially even before the switch to third-party coverage.

The fund informed its members late last month that their dependents will no longer be covered as of Jan. 1, 2011. Currently about 6,000 children are covered by the benefit fund, some until age 23.

The union fund faced a “dramatic shortfall” between what employers contributed to the fund and the premiums charged by its insurance provider, Fidelis Care, according to Mitra Behroozi, executive director of benefit and pension funds for 1199SEIU. The union fund pools contributions from several home-care agencies and then buys insurance from Fidelis.

“In addition, new federal health-care reform legislation requires plans with dependent coverage to expand that coverage up to age 26,” Behroozi wrote in a letter to members Oct. 22. “Our limited resources are already stretched as far as possible, and meeting this new requirement would be financially impossible.”

Behroozi estimated that the fund faced a $15 million shortfall in 2011 and more in the following years for the coverage of workers’ children.

The union said in a statement that the state required the fund to participate in a new program — the Family Health Plus Buy-In Program — beginning in 2008. The union said it expected that by joining the program, many of its members would qualify for state assistance for health-insurance coverage. “Instead they raised insurance rate increases without any increase in funding, and then cut Medicaid funding to the same workers nine times in the last three years,” the union said in a statement.

But the state denies requiring the union to join the program. “The state is not forcing 1199 to do anything regarding its employee health insurance,” said Jeffrey W. Hammond, spokesman for the New York Department of Health.

Home-care agencies that contribute to the union fund collect their revenue from the state’s Medicaid program. Over the past two years the state cut about $370 million in Medicaid reimbursements to home and community-based care programs, according to New York State Association of Health Care Providers Inc., a trade association that represents agencies that employ home attendants.

“In home care in general, whether in a union or a non-unionized workplace, they are dealing with the crisis of trying to do more and more with less and less, and cut on top of cut,” said Christine Johnston, president of the association.

For the 1199 fund, premiums rose because Fidelis realized that the home health-care attendants are sicker than average, according to Mark Lane, president and chief executive of Fidelis Care. “These people are hard working people. There’s physical labor, which manifests itself in terms of more chronic and acute care type of illnesses,” said Lane.

As premiums went up and employer contributions remained constant, the benefit fund started cutting the rolls of eligible members. In the past three years the 1199 fund reduced its total enrollment in half, to less than 40,000 currently.

“We hope the state of New York will do the right thing and provide the funding necessary for this most vulnerable population of direct caregivers,” the union said in a statement.

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HEALTH BENEFIT COST GROWTH ACCELERATES, SURVEY SAYS

Business Wire –

Nov. 22: New York – 2010 is Year Zero for health reform the year against which the effects of the new Patient Protection and Affordable Care Act (PPACA) will be measured.

Growth in the average total health benefit cost per employee, which had slowed last year to 5.5%, picked up steam, rising 6.9% to $9,562, the biggest increase since 2004, according to the latest National Survey of Employer-Sponsored Health Plans, conducted annually by Mercer.

Employers expect high cost increases again in 2011. They predicted that cost would rise by about 10% if they made no health program changes, with roughly two percentage points of this increase coming solely from changes mandated by PPACA for 2011. However, employers expect to hold their actual cost increase to 6.4% by making changes to plan design or changing plan vendors.

Mercer’s survey includes public and private organizations with 10 or more employees; 2,836 employers responded in 2010. “Employers did a little bit of everything to hold down cost increases in 2010,” said Beth Umland, Mercer’s director of health and benefits research. “The average individual PPO deductible rose by about $100.

Employers dropped HMOs, which were more costly than PPOs this year. Large employers added low-cost consumer-directed health plans and found ways to encourage more employees to enroll in them. And more employers provided employees with financial incentives to take better care of their health.”

Large employers experienced a sharper cost increase than smaller employers in 2010. Cost rose by 8.5% among employers with 500 or more employees, but by just 4.4% among those with 10–499 employees.

“Large employers may have been taken by surprise by the uptick in the cost increase this year,” said Susan Connolly, a Partner in Mercer’s Boston office. “Higher prices for health care services seem to be part of the equation, but if the recession caused a slowdown in utilization last year, we may also be seeing the effect of employees getting care they’ve been putting off.”

Enrollment in CDHPs offered by the nation’s largest employers jumps sharply in 2010

Overall enrollment in high-deductible, account-based consumer-directed health plans (CDHPs) grew from 9% of all covered employees in 2009 to 11% in 2010.

CDHP enrollment has risen by two percentage points each year since 2006.

With the cost of HSA-based CDHP coverage averaging just $6,759 per employee among all employers in 2010 – almost 25% lower than the cost of PPO coverage the appeal of these plans is clear.

“As both employers and employees become more comfortable with high-deductible plans, we’re seeing more organizations willing to commit to the consumerism concept,” said Ms. Connolly. “Over the past few years employers have worked on finding a balance between giving employees more responsibility for their health care spending and providing the support to help them succeed.”

Already committed to employee health management, employers add financial incentives to build participation

Employers will soon be more limited in how they can shift cost to employees.

Starting in 2014, PPACA sets minimum standards for “plan value” (the percentage of health care expenses paid by the plan) and “affordability” (the employee’s share of the premium relative to household income). These changes are bringing greater focus on improving workforce health as a way to control health benefit cost.

Over the past decade employers have added a wide range of programs under the employee health management or “wellness” umbrella, from health risk assessments (offered by 69% of large employers in 2010) to disease management programs (73%) to behavior modification programs (50%).

In 2010 more employers added incentives or penalties to encourage more employees to participate: 27% of large employers with health management programs provided incentives, up from 21% last year. In addition, the incentives are becoming more substantial. Three years ago, a token gift like a hat or water bottle was the most common incentive for completing a health risk assessment; now it is cash (typically, $75) or a lower premium contribution (typically, a reduction of $180).

Results are encouraging: For a second year in a row, medical plan cost increases in 2010 were about two percentage points lower, on average, among employers with extensive health management programs than among those employers offering limited or no health management programs.

Very large employers are also increasingly willing to reward employees who demonstrate responsibility for their own health. More than a fourth of those with 20,000 or more employees require lower premium contributions from nonsmokers – 28%, up from 23% last year. An additional 6% provide other incentives to nonsmokers.

Employers drop retiree medical plans in favor of subsidizing individual coverage

The prevalence of retiree medical plans slid to its lowest point ever in 2010, with just 25% of large employers offering an ongoing plan to retirees under age 65 (down from 28% in 2009) and just 19% offering a plan to Medicare-eligible employees (down from 21%). An additional 10% of employers have closed their retiree plans to new hires but continue to offer coverage to employees retiring or hired after a specific date.

A diminished tax break for employers who provide retiree drug plans and the anticipated availability of better Medicare coverage as the government shrinks the so-called “doughnut hole” gap in prescription drug coverage are among the factors that have employers reexamining their retiree health programs.

As some employers take the step of terminating group coverage for retirees, they are softening the blow with a subsidy to help pay for individual coverage. Nearly one in ten of the largest employers (those with 20,000 or more employees) now provide such a subsidy in lieu of a group plan.

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HEALTH INSURANCE EXCHANGES MUST BE ACCESSIBLE AND CONSUMER FOCUSED FOR PURCHASERS

Business Wire –

Nov. 8: Orange, CA. – As states around the country begin to assemble their own health insurance exchanges as mandated by healthcare reform, the nation’s leading expert on such programs believes some fundamental essentials must be followed in order for these exchanges to be stable and sustainable.

“State exchanges need to be as welcoming to those currently insured as they are to the uninsured,” said Ron Goldstein, president of CHOICE Administrators, the nation’s leader in developing and administering employee-choice health benefit programs. “Exchanges will need to appeal every bit as much to individuals and small groups who do not qualify for subsidies or tax credits as they do to those who qualify for these incentives. Only by being inclusive to all individuals can a state exchange attract the type of balanced enrollment that will allow it to be a stable and sustainable force in the market.”

As the architect and president of CHOICE Administrators, Goldstein oversees the nation’s oldest and most successful private health insurance exchange for small and mid-size groups – CaliforniaChoice. Launched in 1996 CaliforniaChoice currently works with more than 10,000 employers and covers 150,000 members. In August it became the first health insurance exchange in the nation to reach the 20 million member-month historical plateau.

Leveraging this experience, Goldstein believes that in order for state exchanges to be balanced and sustainable, they must focus on a three-pronged formula for success. “First, state exchanges must harness existing sales and enrollment channels such as brokers and general agents who already have established relationships in the market and who know how to get the job done,” he says. “It is vitally important that we don’t unnecessarily disrupt the market or force purchasers away from something that is already working.

“Second, state exchanges will need to make sure they are operationally and administratively excellent with a strong consumer focus,” Goldstein continues. “And third, they need to acknowledge that there will remain a market outside the exchange providing businesses and consumers choices in their healthcare decision making.”

Health insurance exchanges are a key feature in the Patient Protection and Affordable Care Act, which mandates that every state establish a health insurance exchange by January 1, 2014, or default to a federal “fallback” exchange.

Exchanges are designed to promote choice and make health insurance purchasing more value based by allowing an individual or small business to compare the costs and benefits of various health plans and benefit options. With such information in hand, purchasers will be able to do a better job selecting a health plan that best fits their needs and budget.

“Exchanges may end up the yardstick by which health reform is judged for generations to come,” said Goldstein. “Making health insurance more accessible and affordable for all Americans is an awesome task and noble goal. If we all pull together, we can make it work.”

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New Governors to Target Health Law

By JANET ADAMY  Associated Press

Scott Walker, Wisconsin’s Republican governor-elect, says he plans to join a lawsuit over the health law.

Newly elected Republican governors are planning to blunt key parts of the federal health overhaul and join lawsuits against it, suggesting states could trump Congress as the hottest front in the fight over the law. There’s also a major lawsuit against xarelto, click here to see the side effects of Xarelto. And see if you or a loved one could have a case against xarelto.

Republicans recaptured at least 11 governors’ seats from Democrats in Tuesday’s election, winning in Pennsylvania, Ohio, Michigan, Wisconsin, Kansas, Oklahoma, Wyoming, Tennessee, New Mexico, Iowa and Maine. Democrats reclaimed at least two seats from Republicans, in California and Hawaii.

House Republicans have pledged to repeal the law, which is designed to expand insurance to 32 million additional Americans, or at least choke off funding to implement it. Democrats in the Senate can block any repeal, and the defunding strategy faces roadblocks.

While governors can’t avoid much of the law, they can throw sand in its gears and keep states out of involvement in a central part of it—new exchanges for selling insurance policies.

Wisconsin’s Republican governor-elect, Scott Walker, met with lawmakers Wednesday to discuss how to minimize the state’s participation in the law’s expansion of Medicaid, the federal-state insurance program for the poor. He also wants to lean on private entities to run the insurance exchanges, where lower earners who qualify for tax credits and small businesses will shop for insurance starting in 2014.

Under Gov. Jim Doyle, a Democrat, Wisconsin ambitiously courted early health-law money, including funding for free birth control.

Mr. Walker is worried that the Medicaid expansion, initially paid for by the federal government, will be too costly once states must begin paying for a portion of it in 2017.

“Free money is not free,” he said in an interview. “If we can’t afford it, it doesn’t matter how much of it is free.”

Mr. Walker, along with new GOP governors in Wyoming and Oklahoma, said they planned to join in the legal fights against the law’s requirement that most Americans carry insurance or pay a fine.

Plaintiffs in the largest suit, a 20-state effort led by Florida’s Republican attorney general, plan to reach out to as many as six states with newly elected Republicans to join the effort, according to a person familiar with the case, though it may be too late to join.

Health-care companies say GOP gains at the state level offer new opportunities to influence how the law is implemented.

“We have more Republican governors who may have interest in different models,” Aetna Inc.’s Chief Executive Ronald Williams told analysts in a conference call Wednesday. So the discussion “may very well tip it more toward market-based solutions as opposed to others.”

In a recent NBC News/Wall Street Journal survey, 51% of respondents said it would be acceptable to repeal the law. President Barack Obama said Wednesday he wanted to know which parts of the law Republicans don’t like.

“When it comes to pre-existing conditions, is this something you’re for or you’re against?” he said at a news conference, referring to the mandate on insurers to cover those who already have ailments.

“Helping seniors get their prescription drugs—does that make sense or not?” he said.

Mary Fallin, a Republican elected Oklahoma governor, said she was emboldened by a largely symbolic 65%-35% vote in her state for a measure opposing the individual insurance requirement.

“I think the people of Oklahoma have spoken that they’re concerned and they do not support the program of taking over the health-care system,” Ms. Fallin said.

She said she was looking at whether Oklahoma can lean on an existing public-private program that provides insurance to the poor as an alternative to the law’s Medicaid expansion.

“We certainly will try to minimize the impact the new federal law will have on the state of Oklahoma and certainly on our budget with unfunded mandates,” Ms. Fallin said.

Should states opt out of the law’s Medicaid expansion, they would have to remove themselves entirely from the Medicaid program—an unlikely outcome.

But Ray Scheppach, executive director of the National Governors Association, said states were likely to press the federal government to delay the expansion beyond 2014 given states’ bleak budget picture.

Matt Mead, Wyoming’s Republican governor-elect, can appoint his own attorney general and insurance commissioner-two positions with ample influence over the law’s enactment.Mr. Mead said in an interview that the current governor, a Democrat, has already begun preparing the state to operate the insurance exchanges, but he hasn’t decided whether he will go forward with running them. The federal health law provides for state-based exchanges but allows states to leave operation to the federal government.

“It’s just a question of what is right for Wyoming,” he said

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States, not Congress, can thwart healthcare law

Los Angeles Times – Reporting from Washington and Chicago —

House Republicans swept to power Tuesday with promises to roll back the new healthcare law and subject its creators to a merciless round of congressional investigations.

But the fate of President Obama‘s sweeping overhaul will probably be determined not in Washington but in state capitals across the country, where the GOP also scored dramatic victories.

Republican governors and legislatures, who are charged with carrying out crucial parts of the law, will be in a position to put pressure on the White House to scale back some plans, including the extension of government-subsidized health benefits to millions of uninsured Americans.

State Republicans could also temper insurance regulations and compel a relaxation of new mandates set to take effect over the next few years.

And by joining a multistate legal challenge, Republican governors may further embolden conservative judges to invalidate a new requirement that Americans get health insurance beginning in 2014, a key pillar of the healthcare law.

The governors-elect of Kansas, Oklahoma, Wisconsin and Wyoming have already indicated they want to join the 21 states suing over the law.

“While there are some important decisions still to be made in Washington, the real action is out in the states,” said Alan Weil, executive director of the National Academy for State Heath Policy.

With Democrats in control of the Senate and President Obama sure to veto any healthcare repeal, House Republicans have little power to force many changes from Washington.

But Republicans gained at least 11 governor’s offices last week, while losing three, flipping states such as Wisconsin and Pennsylvania where Democratic governors had been moving aggressively to implement the new law.

The GOP will also control state legislatures in at least 25 states next year, up from 14. Among actions expected of the states under the law are creating state-based insurance exchanges in which people who don’t get benefits at work would be able to shop for health plans starting in 2014.

Many of the newly elected officials, such as Florida Gov.-elect Rick Scott, ran blistering campaigns against the healthcare law. Scott, a former hospital executive who personally bankrolled one of the first ad campaigns against the healthcare bill in 2009, has called the law the “single largest government power grab in history.”

However, Weil and other healthcare experts who are working with states say it is unlikely that even the most critical Republican politicians will simply refuse to implement the law.

GOP officials in many states that are fighting the law in court — including Virginia, Florida, Louisiana, Minnesota and Nevada — have already convened healthcare task forces to work on the overhaul.

“If I had been a member of Congress, I would have voted against the law,” said Louisiana Insurance Commissioner James Donelon, a Republican. “But it’s the law, and we will comply with it until and unless the courts or Congress change it.”

Republican governors have another incentive. The new healthcare law authorizes federal officials to operate an insurance exchange in any state that chooses not to do so.

“Having the federal government march in” is not appealing to many state leaders, said Timothy Jost, a law professor and consumer representative to the National Assn. of Insurance Commissioners.

But resistance to the new law has already emerged in several statehouses. Legislatures in Minnesota and Rhode Island in the last year have rejected bills to create insurance exchanges.

In California, legislation creating an exchange passed without a single Republican vote in the Senate.

Now, several governors are also looking at ways to slow down a major expansion of the Medicaid program, the federal-state insurance program originally designed for poor children.

Beginning in 2014, the law directs states to open Medicaid to all low-income residents, a move that is estimated to cover an additional 16 million people by 2019.

While the federal government is to provide most of the new funding, some state analysts predict it will be difficult for financially strapped states to shoulder even a small increase.

“This recession was so big and broad and wide that it will have repercussions for a decade or more,” said Ray Scheppach, executive director of the National Governors Assn.

State lawmakers may also resist efforts by the Obama administration to expand state oversight of insurance premiums, a key goal of the new healthcare law. Bills to strengthen state regulation were recently quashed in California and Pennsylvania.

Some state insurance commissioners are also looking to petition the Obama administration to delay other new regulations that require insurance companies to spend more on their customers’ medical care.

Maine was the first state to make such a request, citing concerns that the requirement set to take effect in January would force insurers to flee the state, leaving consumers with fewer choices.

Other states are expected to seek waivers from the so-called medical loss ratio provision in coming months.

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