Implementation of the Affordable Care Act––More Evidence That Rate Shock is Coming

The Society of Actuaries is out with another estimate of health
insurance rate increases as a result of implementation of the
Affordable Care Act ("Obamacare").

While there is a great deal of difference between states, they are estimating an average increase of 31.5% on account of the new underwriting reform and benefit expansion requirements of the health law:



These rate increase

Six Months to Go –– Will the Health Insurance Exchanges Be Ready on Time? Survey: Health Plan Execs Don't Think So

As the Obama administration continues its top secret effort to build federal insurance exchanges in about 34 states while 16 states are doing it on their own, that continues to be the big question.

HHS is using IT consulting firm CGI for much of the work on the exchanges and the federal data hub. CGI has their plate full since they are not only working on the federal exchange but also doing work

The Cost to Launch the California Health Insurance Exchange is $910 million––Does That Sound Like a Lot to You?

So far California has received $910 million in federal grants to launch its new health insurance exchange under the Affordable Care Act ("Obamacare").

The California exchange, "Covered California," has so far awarded a $183 million contract to Accenture to build the website, enrollment, and eligibility system and another $174 million to operate the exchange for four years.

The state will also

WSJ - Insurer Health Premium Warnings Continue

Today's Wall Street Journal has another article concerning warnings by health insurers about potentially high premiums in January when Obamacare kicks in.  

http://online.wsj.com/article/SB10001424127887324557804578374761054496682.html?mod=pls_whats_news_us_business_f

Health insurers are privately warning brokers that premiums for many individuals and small businesses could increase sharply next year because of the health-care overhaul law, with the nation's biggest firm projecting that rates could more than double for some consumers buying their own plans.

In a private presentation to brokers late last month, UnitedHealth Group Inc., the nation's largest carrier, said premiums for some consumers buying their own plans could go up as much as 116%, and small-business rates as much as 25% to 50%.  

 Aetna Inc., in a presentation last fall to its national broker advisory council, suggested rates on individual plans not being grandfathered under the law could go up 55%, on average, and gave a figure of 29% for small business rates. 

Those at lower income levels will receive subsidy for both premiums and a subsidy reduction in deductibles, co-pays and out of pocket maximums.  Those at higher income levels will receive no assistance towards premiums.  

Dave
www.davefluker.com

Exchange Board Balance

In late fall of 2012 two Exchange Board seats became vacant due to resignations and a third was dropped completely with the resignation of the Special Advisor to the Governor on Health Reform. That seat no longer exists. After more than three months, one seat has been filled by Mr. Paul Philpott currently a Realtor in Connecticut and retired for the Connecticut Insurance Industry. Although I commend Mr. Philpott for his willingness to take this challenging voluntary position, Mr. Philpot is yet another person from the insurance industry on what was supposed to be a Board populated by "consumers". As of Thursday's Exchange Board meeting the "Small Business" seat has yet to be filled. This appointment has been the responsibility of State Representative Larry Cafero. It is unfortunate Representative Cafero has chosen not to make this appointment during such a critical time for our Exchange. But our legislature has given the Exchange some attention. The Insurance and Restate Committee recently voted unanimously to add a broker seat to our Exchange, a clear violation of the letter and spirit of the Affordable Care Act. Unfortunately small businesses, the largest employer in the state and nation, do not presently have a seat at Connecticut’s Health Care Exchange table.

Kevin Galvin Small Business For A Healthy Connecticut

Narrow Provider Networks For Exchange Health Plans?

An article in today's Wall Street Journal reinforces something we brokers have known for quite some time--health exchange plans will have limited provider networks for access to healthcare.

These networks, known as limited or narrow networks (a newer term is ACO - accountable care org) will have a much smaller number of participating providers and will be working with lower negotiated rate schedules than traditional networks such as Blue Cross' Prudent Buyer Network.

For those who purchase health coverage inside of the exchange, the availability of healthcare providers will be markedly less than plans sold on the open market.  This may mean that Blue Cross or Blue Shield PPO health plans may not offer BlueCard national PPO access on plans sold through the exchange leaving that benefit to normal network plans sold outside of the exchange.

Once the California health plans are developed and released for the exchange and non-exchange markets, we will have a clearer idea about the networks available in both markets.

Dave

www.davefluker.com