We already understand that, after January 1, 2015, employers with the equivalent of 50 or more full-time workers to provide health insurance or else pay a $2,000 per employee fine. We know that “full-time” means 30 or more hours per week over a measurement period. But in the midst of discussion about who has to offer and who will get coverage, the question has arisen about what coverage will actually have to be offered by a large employer. The concept of “skinny” plans has started to emerge as a possible option for large employers looking to keep coverage costs lower.
Skinny plans are essentially an outgrowth of “mini-med” plans that are set to be phased out. Mini-meds offered very limited coverage, but they also were very affordable. Some companies offered mini-meds to their part-time employees as an option to provide at least some coverage when they were not eligible for the plans offered to full-time employees. The theory is that, unlike the exchange plans, large-employer plans that are sponsored by an employer do not have to cover the 10 categories of services in the health care law’s essential health benefits. Thus, they are less expensive, but they provide a lower benefit that an exchange plan. Click Here for Full Story…
If we were to draw two columns — one for winners from the Patient Protection and Affordable Care Act, or PPACA, and another for losers — the word “hospitals” would probably be listed near the top in the winner’s column. Large hospital chains Health Management Association (NYSE: HMA ) and Tenet Healthcare (NYSE: THC ) , have seen their stocks more than double over the past year, whileCommunity Health Systems (NYSE: CYH ) is up around 75%.
Investors flocked to hospital stocks in anticipation of the full implementation of PPACA, commonly referred to as Obamacare. In the minds of many, Obamacare presented a dream come true for helping hospitals to flourish. But could that dream now be turning into a nightmare for the industry? Click Here for the rest of the story….
Published on Jul 16, 2013
In a “speaker’s minute” speech on the House floor today, Speaker John Boehner talked about the Republican plan for economic growth and jobs, and previewed tomorrow’s votes on legislation by Reps. Tim Griffin (R-AR) and Todd Young (R-IN) to give all Americans “the same break from ObamaCare that the president wants for big businesses.”
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Millions of Californians who contact the state’s new health exchange to buy insurance will be given the opportunity to register to vote, too, a move that some Republicans fear could benefit Democrats.
Secretary of State Debra Bowen made California the first state to designate its health exchange as a voter registration agency Wednesday, but others are expected to follow suit, said Shannan Velayas, Bowen’s spokeswoman.
“This is about making sure that all eligible Californians are offered the chance to register to vote,” Velayas said Thursday.
A 1993 federal law requires states to designate their agencies and offices that provide public assistance or disability services as voter registration agencies, Velayas said.
The federal law commonly is known as “motor voter” because it ensured that applicants for drivers’ licenses nationwide would be asked if they wanted to register to vote.
Public agencies in California that currently serve as voter registration outlets include the Department of Motor Vehicles and offices overseeing the state’s welfare, tax collection and in-home supportive services.
California’s health care exchange, Covered California, is creating a marketplace for millions of uninsured Californians to compare prices and buy health insurance policies this fall to take effect Jan. 1.
Many of Covered California’s clients are expected to be families of low and moderate incomes. Some will be eligible for taxpayer-subsidized policies, and others will have incomes low enough to qualify for Medi-Cal.
Senate GOP leader Bob Huff said he supports the notion of all Californians registering to vote but that targeting specific populations of people creates the possibility of partisan advantage.
“It does beg the question about whether it’s a systematic attempt to try to empower people more predisposed to vote their way,” Huff said of the designation by Bowen, a Democrat. “And that would be concerning to us.”
When the state launched an online system of voter registration two months before last year’s November election, the new voters who signed up were more Democratic than the voting population as a whole, according to an analysis by the California Civic Engagement Project at UC Davis.
Democratic Sen. Lou Correa of Santa Ana, chairman of the Senate elections committee, said he was not aware of Bowen’s designation of Covered California this week but supports the concept.
“I believe the foundation of democracy is voters,” he said. “More voter participation means greater democracy in our country.”
Lori Shellenberger, director of the Voting Rights Project of the American Civil Liberties Union of California, characterized Bowen’s designation as “one of the most significant voter registration policy decisions in the state’s history.”
A new report by the Independent Society of Actuaries predicts that individual market health insurers could experience as much as a 32% increase on average in health care costs from 2014 through 2017 due to changes brought on by the Patient Protection and Affordable Care Act (PPACA). This would result in higher premiums as the increased costs are passed on to those who purchase health insurance in the individual markets.
The report refers to an “average” increase in costs, but the actual increase in “per member per month” (pmpm) claims expenses will vary from state to state.
According to the report, some states could experience dramatic increases. By 2017, the study estimates the pmpm increases will be 62% for California, 67% for Maryland and over 80% for Ohio and Wisconsin. Other states will see less dramatic increases. Colorado, for example, could experience a 39.6% higher pmpm; Florida 26.5%; and Texas 33.8%. The higher claims costs would primarily be due to the increased level of health care services required by new entries to the insurance market.
However, some states that already have imposed extensive mandated benefits and community rating provisions could see a decrease in pmpm anticipated average claims, including Massachusetts (-12.8%), New Jersey (-1.4%), New York, (-13.9%), and Rhode Island (-6.6%).
The report also includes two other major findings:
- After three years of Exchanges and insurer restrictions, the percentage of uninsured nationally will decrease from 16.6% to between 6.8 and 6.6%, compared to pre-ACA projections.
- Under PPACA , the individual non-group market will grow 115%, from11.9 million to 25.6 million lives; 80% of that enrollment will be in the Exchanges. (See report athttp://cdn-files.soa.org/web/research-cost-aca-report.pdf, page 6.)
The report does not address PPACA’s impact on large employer group health plans as the most affected will be individual and small employer group health benefits during this period.
The study immediately drew fire from the Obama Administration regarding the projected premium increases. The administration claims the analysis fails to consider cost relief strategies in the law, such as federal premium tax credits to make premiums more affordable, and the risk adjustment pools that would help subsidize health insurance carriers that attract a disproportionately higher share of those with expensive health conditions.
However, insurance experts countered that neither of these mechanisms actually will cut the cost of the claims’ pmpm. These mechanisms will simply transfer funds from the federal budget to individuals, or shift funds generated by a premium tax on individual health insurance companies to plans with a disproportionate share of adverse actuarial risks.
Rick Foster, former Medicare chief Actuary, says the report does “a credible job” of estimating potential enrollment and costs under the law “without trying to tilt the answers in any particular direction.” He further notes that “actuaries tend to be financially conservative, so the various assumptions might be more inclined to consider what might go wrong than to anticipate that everything will work beautifully.”
On a positive note, clearly PPACA will expand insurance coverage for many. However, the Democratic leadership promised that the passage of PPACA would save the country money. This Society of Actuaries study reminds us that this last promise is unlikely unless the Administration makes some modifications to the current reforms.
Author: Michael Gomes
APRIL 19, 2013 – 9:53 AM
Friday, April 12, 2013
Study: Health Care Costs Higher for Young Adults Newly Covered by ACA
Young adults who enrolled in a parent’s employer-sponsored health plan after an Affordable Care Act provision took effect incurred about 15% more in health care costs than those who already were covered under their parents’ plans, according to a study by the Employee Benefits Research Institute, The Hill‘s “Healthwatch” reports.
The study notes that the newly insured young adults were more likely to use their coverage for mental health, substance use disorder or pregnancy care, (Viebeck, “Healthwatch,” The Hill, 4/11).
Under the Affordable Care Act, employers that offer insurance plans are required to allow workers to include their children on health plans up to age 26. According to Politico, about 3.1 million young adults nationwide have gained coverage under the provision, which went into full effect in 2011 (Smith, Politico, 4/12).
For the study, researchers examined insurance claims from 2010 and 2011 at one large U.S. employer to determine the effect of that ACA provision. The researchers compared insurance claims for nearly 700 young adults who enrolled in a parent’s health plan in 2011, under the ACA provision, with about 13,000 young adults who already were covered under a parent’s plan prior to the provision taking effect.
The study found that 60% of hospital claims for the newly enrolled young adults were for mental health, substance use disorder or pregnancy care, compared with just one-third of claims filed for young adults who were already receiving coverage under their parents’ plans.
Further, the findings showed that mental health and substance use disorder care accounted for 42% of newly enrolled young adults’ inpatient hospital visits. The study also showed that the group was nearly four times more likely to use their insurance for pregnancy-related care than those who were previously insured. Meanwhile, the majority of inpatient hospital claims for young adults who already were covered in 2011 were for miscellaneous problems (“Healthwatch,” The Hill, 4/11).
As a result, the study found that the newly enrolled young adults incurred $2,866 in health care costs per person, on average, compared with a $2,472 per-person average for young adults who already were covered by their parents’ plans (Radnofsky, “Washington Wire,” Wall Street Journal, 4/11).
According to “Healthwatch,” the figures could reflect the higher cost of treatment for conditions such as substance use disorders and pregnancy, compared with “miscellaneous” hospital visits (“Healthwatch,” The Hill, 4/11). The company studied by EBRI noted that the cost incurred by the newly enrolled young adults added just 0.2% to their overall health care costs (“Washington Wire,” Wall Street Journal, 4/11).