2016 OPEN ENROLLMENT IS COMING TO AN END

Have you taken advantage of Open Enrollment for individual health insurance for 2016?

If not, you have until January 31st to complete your enrollment in an ACA (Obamacare) compliant plan.

Open Enrollment will also give you the opportunity to change carriers or categories of plans (Bronze, Silver, Gold, and Platinum), even if you have already selected a plan that went into effect January 1st.

If you enroll on or before January 15th, your effective date will be February 1st. From January 16th until January 31st, your effective date will be March 1st.

After January 31st, you will not be able to enroll in an ACA approved plan until next year’s Open Enrollment.

The only exception to this rule is the occurrence of a “qualifying event”, which will allow you to enroll in coverage outside of Open Enrollment.

For those living in California the most common “qualifying events” are losing employer based group coverage, marriage, divorce, or the birth of a child. You will have 60 days from the date of the event to enroll in a new individual policy. If you miss the 60-day window you will be required to wait to enroll in a plan until the next Open Enrollment.

If you fail to enroll in a plan for 2016, the penalty for not being covered has increased. For an individual it’s THE GREATER of $695 or 2.5% of household income, not to exceed the average national cost of a Bronze plan of approximately $2700.

For a family calculation of the penalty is bit more complicated: $695 for adults, and $347.50 per child up to $2,085 OR 2.5% of household income, up to a maximum of approximately $13,300, WHICHEVER IS GREATER.

If you miss Open Enrollment you can still obtain short term medical coverage, hospital coverage plans, and other types of coverage for accidents or other specific occurrences.

However, these plans do not serve as a substitute for ACA approved plans, which means you still will be subject to the Obamacare penalty for lack of proper coverage.

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More People Turn to Faith-Based Groups for Health Coverage

In a trend that could challenge the stability of the Affordable Care Act, a growing number of people are turning to health-care ministries to cover their medical expenses instead of buying traditional insurance according to a Wall Street Journal article published last week on their wsj.com website.

The ministries, which operate outside the insurance system and aren’t regulated by states, provide a health-care cost-sharing arrangement among people with similarly held beliefs. Their membership growth has been spurred by an Affordable Care Act provision allowing participants in eligible ministries to avoid fines for not buying insurance.

But now, some insurance commissioners are concerned that the ministries could put consumers at risk if bills aren’t paid. The ministries aren’t overseen by state commissioners, which generally guard against unfair practices and ensure solvency.

  • Ministry officials say they aren’t offering insurance, don’t guarantee claims will be paid, and don’t need to be regulated. The nonprofits are well managed, according to ministry officials, with third-party audits and a sterling history of sharing members’ claims.
  • Ministries generally don’t allow members to sue and require disagreements to be settled by arbitration and mediation.
  • Most ministries don’t always share bills for certain pre-existing conditions, whereas the ACA requires insurers to cover anyone regardless of their past or current medical history.

State regulators also say health ministries disrupt the insurance market because they tend to attract healthier consumers, siphoning them from commercial plans that can be left with sicker or older customers. Insurance commissioners in some states have moved to shut down the ministries’ state operations.

Many of the estimated 50 health-care ministries in the U.S. are small operations, and some churches have their own programs limited to parishioners. There are several large Christian ministries, and at least two other ministries open to people regardless of specific religious faith.

Members typically must abide by Biblical principles such as not having sex outside of marriage, and may have to sign a statement of religious faith.

Some consumers say they joined ministries to avoid rising deductibles and premiums on the health law’s exchanges, and to be free from the law’s penalty, which starts at $695 for 2016.

Consumers generally pay a set monthly amount that goes into a general account or directly to others who have eligible medical bill. They can also submit their own eligible bills to be shared by other members. In some ministries, members make contributions directly to others—and tuck gifts, personal cards and get-well wishes into the envelopes. Preventive care in some cases isn’t covered.

There have been lawsuits by ministry members against a cost-sharing ministry, claiming particular medical bills that should have been shared were not. The cases were ultimately settled or resolved through arbitration.

*Modified from a wsj.com article and other online sources.

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2016 OPEN ENROLLMENT FOR INDIVIDUAL HEALTH INSURANCE

Open Enrollment for 2016 individual plans will begin on Monday November 1st, and continue until January 31, 2016. During this period of time, you will be able to change insurance carriers and your individual plan category (Bronze, Silver, Gold, Platinum).

All carriers have made minor changes to their individual plans based upon Obamacare mandates. There are low or moderate increases in premiums for plans offered through the Covered California State Exchange (for those who need a federal premium assistance subsidy), and for Off Exchange plans for those that do not qualify for the subsidy.

Based upon review of next year’s plans, only Anthem Blue Cross and Blue Shield of California will have PPOs available in every county in California. Both carriers have increased for 2016 the number of providers that make up their individual plan provider networks. In addition, both carrier’s individual plans will have access to the full Blue Cross / Blue Shield nationwide provider network.

Anthem and Blue Shield have added new Bronze and Silver plans available for Off Exchange enrollment. These plans have unique features, and lower non subsidized premiums than On Exchange (Covered CA) plans.

If you choose Covered California in order to obtain a federal premium assistance subsidy, you need to begin the enrollment process immediately, because of the paperwork required to prove your anticipated 2016 income level.

For Off Exchange enrollment, you have adequate time to review options. Your application must be submitted by December 15th to have a January effective date.

If you have questions regarding Off Exchange plans and enrollment, please call me at (626) 797-4618 or email me at john@healthinsbrokers.com.

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ANTHEM CHANGES INDIVIDUAL PLANS FOR 2016

Are you ready for Open Enrollment for 2016? Under the ACA (Obamacare), individual health insurance plans are issued as a twelve-month contract that begins in January and ends in December. New rates on individual plans will begin on January 1st, and remain in effect until December 31, 2016.

  • If you currently have an individual Anthem Exclusive Provider Organization (EPO) policy, Anthem Blue Cross will change your plan to a Tiered PPO for 2016. In Southern California these EPO plans are offered in Los Angeles, Orange, and San Diego counties. Beginning in 2016, plans in these counties will be changed to Tiered PPO plans.

The major difference between EPO and PPO plans is that EPO plans do not offer any out of network benefits. The means you will receive no reimbursement for out of network medical expenses. PPO plans do offer out of network benefits.

Anthems Tier PPO plans split hospitals in their provider network into two categories: Tier 1 and Tier 2. Members utilizing Tier 1 hospitals pay a lower share of cost (co-insurance). The maximum out of pocket (OOP) is the same for both Tiers.

The other major change for Anthem individual plans is they will become part of the nationwide Blue Cross/Blue Shield provider network. Currently, other than emergency services, all providers outside of California are considered out of network, and not subject to reimbursement.

Structurally. deductibles and out of pocket costs will increase for Bronze plans. The maximum deductible will increase to $6,600, and the maximum OOP will increase to $6,850.

The maximum deductible for Silver plans will increase to $2,250, and the OOP to $6,350. For Gold and Platinum, which have no deductibles, the OOPs of $6,200 and $4,000 respectively will remain the same for 2016.

  • The 2016 plans offered in Southern California have small rate increases for Bronze and Silver plans, and larger increases for Gold and Platinum plans. In Southern California the lowest rates are still in the Pasadena/San Gabriel Valley, and the highest rates are in San Diego County.

If you have questions please call me at (626) 797-4618 or email me at john@healthinsbrokers.com

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75% of Obamacare plans in California use narrow networks, study shows

A new study finds that 75% of California’s Obamacare health plans have narrow physician networks — more limited choices than all but three other states. The report examines health plans sold to consumers last year under the Affordable Care Act and shows wide variation in the prevalence of narrow networks across the country.

To hold down premiums under the health law, big insurers such as Anthem Inc. and Blue Shield of California cut the number of doctors and hospitals available to patients.

Consumers often have the ability to search for specific doctors before picking out a policy. But that information doesn’t tell a consumer how restricted an overall network may be for primary-care doctors or specialists.

Covered California, the state’s insurance marketplace, and its participating health plans have said networks have been expanding since the initial rollout in January 2014 to ensure patients’ needs are met. But 18% of exchange policyholders surveyed said a medical provider would not accept them as a new patient.

State and federal regulators have been grappling with how to respond to consumer complaints about skinnier networks and inaccurate information in provider directories. It took considerable time and effort to clean up insurance company provider lists before any analysis could be done.

Better data on exchange networks is essential so regulators can ensure patients have sufficient access to doctors and consumers can determine whether a lower-priced narrow network policy is a good deal.

“Network composition is a major way in which insurance companies can attempt to control costs in the marketplace, and for consumers there is often a tradeoff between access and price,” said the director of health coverage issues at the Robert Wood Johnson Foundation.

Health researchers also mapped how narrow networks vary within states with the prevalence far higher, for instance, in several areas of Southern California.

It also differs by plan type. More than 90% of California’s HMO networks for individual coverage were narrow, compared to a third of PPO plans in the state.

*Modified from a LA Times.com article, Covered California, and other online sources.

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DON’T LET YOUR HEALTH INSURANCE BE CANCELLED FOR NON PAYMENT OF PREMIUM!

A disturbing trend has begun to occur for those individuals who enrolled in coverage Off Exchange directly with the insurance carriers – A spike in the rise of cancellations for non-payment of premiums.

There are three reason for cancellations: (i) intentional nonpayment of premiums because of financial hardship; (ii) the inability of the carriers to debit the credit card or bank account established to pay the premiums; (iii) failure to send in an actual check in a timely manner to the insurance company.

It’s important for those with Off Exchange plans, the majority of those in California enrolled in individual plans (those without a Federal subsidy or Medi-Cal), to understand the grace periods offered by the carriers for late payments.

  • Insured’s who DO NOT get a Federal subsidy of their premium have a 31 day grace period for making payments.

I have had a number of calls from both clients and others regarding the cancellation of their policies. The majority have been told by the insurance carrier they may not reinstate their policy, and will be uninsured until January 1, 2016.

Therefore, it is important to understand that monthly premium payments are due the first of each month. If the premium payment is not received by approximately the 7th of the month a late payment notice will be mailed to the member.

The grace period for payment begins the postmarked date the carrier mails the first warning notice that the member’s premium is overdue. It is not when member receives the letter, which can be anywhere from two days to a week after the actual letter’s postmark.

The letter will tell when the grace period ends, and warns that the member will lose coverage unless the full past due amount is paid before the 31 day grace period ends. After the grace period ends, the carrier has the right to cancel the policy, even if the member has sent in their premium payment.

An example of the process:

  • Payment is due on first of the month, but if a payment is not received by the end of seven days, a late payment letter will be generated and mailed to the member.
  • The member will receive the letter approximately the second week of the month. The 31 day period begins on the day the letter is mailed (postmarked).
  • If the member pays the premium by the last day of the month, no action will be taken by the carrier.
  • The member may reinstate if full payment is made within the 31 day grace period. However, if payment is not received by the last day of the grace period the policy will be cancelled, and cannot be reinstated.
  • If the policy is cancelled the member will need to wait until the next Open Enrollment period, which begins in November for a January 1st effective date.

If you receive a late notice, react immediately by contacting your insurance broker or the carrier directly. Do not wait until you discover your policy has been cancelled, by then it will be too late.

There are options available if your policy is cancelled to provide you with short term coverage to bridge you to January 2016. However, short term coverage is month to month for up to six months, and is basically catastrophic coverage for inpatient or ER/Urgent care medical services.

If you have questions, please call me at (626) 797-4618 or email john@healthinsbrokers.com

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Health Insurers Seek Hefty Rate Boosts

Major insurers in some states are proposing hefty rate boosts for plans sold under the federal health law, setting the stage for an intense debate this summer over the law’s impact.

One state, New Mexico is asking for an average jump of 51.6% in premiums for 2016. Insurance carriers in several states have proposed 36.3%, 30.4%, and 25% rate increases. In dozens of other larger states carriers have applied for increases averaging 10%.

  • Insurers in California have not announced the percentage increase in their rates; however they have begun the process of filing their rates with state insurance regulators.

All insurance carriers cite high medical costs incurred by people newly enrolled under the Affordable Care Act.

Under that law, insurers file proposed rates to their local regulator and, in most cases, to the federal government. Some states have begun making the filings public, as they prepare to review the requests in coming weeks.

  • Insurers say their proposed rates reflect the revenue they need to pay claims, now that they have had time to analyze their experience with the law’s requirement that they offer the same rates to everyone—regardless of medical history.

Health-cost growth has slowed to historic lows in recent years, a fact consumer groups are expected to bring up during rate-review debates. Insurers say they face significant pent-up demand for health care from the newly enrolled, including for expensive drugs.

  • “This year, health plans have a full year of claims data to understand the health needs showing enrollees are generally older and often managing multiple chronic conditions,” said a spokeswoman for America’s Health Insurance Plans, an industry group. “Premiums reflect the rising cost of providing care to individuals and families, and the explosion in prescription and specialty drug prices is a significant factor.”

The federal government subsidizes premiums for some consumers, based on income, and the validity of those subsidies in most of the country is the subject of a lawsuit the Supreme Court is expected to decide in late June.

  • The filings from insurers are based on the assumption that those subsidies remain in place.

Obama administration officials weathered a storm as some younger, healthier consumers saw their premiums jump when the law rolled out, but were also able to point to modest premiums overall as insurers focused on other ways to keep costs down, such as narrow provider networks.

For 2015 insurance plans, when insurers had only a little information about the health of their new customers, big insurers tended to make increases of less than 10%, while smaller insurers tried offering lower rates to build market share.

Modified from a WSJ.com article

 

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44% of Covered California customers report difficulty paying premiums

A new survey shows that 44% of Covered California policyholders find it difficult to pay their monthly premiums for Obamacare coverage. And a similar percentage of uninsured Californians say the high cost of coverage is the main reason they go without health insurance.

The issue of just how much people can afford will loom large as the state exchange prepares to negotiate with health insurers over next year’s rates.

  • Many analysts are predicting bigger premium increases for 2016 in California and across the country. Insurers have more details on the medical costs of enrollees, and some federal programs that help protect health plans from unpredictable claims will be winding down.

This latest pulse on consumer attitudes is drawn from a Kaiser Family Foundation survey of 4,555 Californians from September to December 2014. It examined the experiences of people in Covered California, Medi-Cal, other private coverage and the uninsured.

  • Forty-four percent of exchange policyholders surveyed said it’s somewhat or very difficult to afford their premiums. That’s compared with 25% of adults who had employer-based or other private health insurance.

Peter Lee, executive director of Covered California, acknowledged that many Californians find it hard to fit health insurance premiums into their household budget, even when they qualify for generous federal subsidies.

“If you are making $25,000 a year that $70 premium is still a struggle,” Lee said. “The Affordable Care Act is providing nobody with a free lunch. This issue of making healthcare affordable is not easy.”

  • Anthem Blue Cross, Kaiser Permanente and other health insurers have submitted their proposed 2016 rates for individual policies to Covered California, and negotiations are expected to begin next month.

The final statewide rates should be announced in July, Lee said. For 2015, the average rate increase was 4.2%.

Modified from a LATimes.com article.

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After Expanding Under Obamacare, This 123-Year-Old Insurance Company (Assurant) Is Closing Its Doors

After expanding to do business on the Affordable Care Act’s exchanges last year, a Wisconsin-based health insurance company founded in 1892 has announced it will close its doors.

Assurant Inc. announced last week one of its subsidiaries, Assurant Health, an insurance company, will either be sold or shuttered after losing tens of millions of dollars this year. The decision comes 18 months after the implementation of the Affordable Care Act (ACA), and industry watchers argue Assurant Health’s end can be attributed to the new health care law.

  • In California, Assurant’s Time Insurance Company subsidiary began writing policies under ACA rules in January of 2014. Individuals enrolled in these medical plans were able to use the Aetna nationwide provider network. The carrier began the process of withdrawing from California in late December of 2014.   

“The health and employee benefits business segments possess differentiated capabilities in their respective markets, but we do not believe they can meet our return targets at the pace we require,” Alan Colberg, president of Assurant Inc., said in a statement. “While this is a difficult decision, we believe they would be strong assets for new owners that are focused more exclusively on health care and employee benefits.”

In a letter to its shareholders, Assurant Health said it lost money because of a reduction in recoveries under Obamacare’s risk mitigation programs and increased claims on the health care law’s 2015 policies.

Before Obamacare’s implementation, Assurant Health would underwrite its customer’s policies, which gave the company a competitive edge. The process involves adjusting the cost of a consumer’s premium based on factors such as medical history and age.

The Affordable Care Act, though, prohibited medical underwriting, and advocates touted the law as easing access to health insurance for people with pre-existing conditions.

In addition to offering insurance on exchanges in more than a dozen states, Assurant Health also sold plans to individuals in 41 states and small businesses in 34 states, insuring close to 1 million people.

Despite the company’s efforts to reach more consumers, Assurant Health saw a $64 million loss in 2014. During the first three months of 2015, the company reported operating losses of $80 million to $90 million.

*Modified from The Daily Signal article, and Assurant press release.

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Employees working fewer hours due to Obamacare: survey

Critics and supporters of Obamacare have argued about its impact on business. A new survey by the Society of Human Resource Management released Tuesday found that some US workers are working fewer hours because of the health care law.

  • The survey found about 14 percent of businesses have reduced part-time hours and another 6 percent plan to do so. Employers are reducing hours to avoid Obamacare’s employer mandate, which requires companies to provide health insurance to all workers that work 30 or more hours a week.
  • In addition, 5 percent of companies have already reduced or plan to reduce the total number of employees. The remainder of those surveyed chose not to reduce employee hours.

The Society for Human Resource Management surveyed 743 human resources professionals from a variety of companies.

This year the law’s employer mandate went into effect for organizations with 100 or more full-time employees, requiring those companies to provide health insurance for 70 percent of their employees. That figure goes up to 95 percent in 2016 and all employees beyond that date.

The small business part of the mandate, which affects business with 50-99 full-time employees, goes into effect in 2016.

  • A common criticism with the law is that companies will have to lay-off workers or reduce full-time employees to part-time to avoid having to pay for health insurance.
  • If any business violates the mandate, they must pay a fee calculated by the number of employees who don’t have insurance. The Internal Revenue Service has said that a company could pay an excise tax of $100 a day per applicable employee.
  • The survey found that 77 percent of companies faced higher healthcare plan costs this year compared to 2014 and 6 percent saw their costs decrease.
  • For that 77 percent, about 24 percent saw their costs go up 16 percent or more. Of the 6 percent that decreased costs, a majority decreased by up to 10 percent.

The survey has a margin of error of plus or minus 4 percent.

Modified from a washingtonexaminer.com article, and the Society of Human Resource Management survey.

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