Two Minute Drill
Believe it or not, you can expect the second year of Obamacare to be even more chaotic than the first. Last week we attended a market update meeting related to this year’s open enrollment which begins November 15. The meeting was sponsored by one of the major insurance companies. Any notions we had for a smoother rollout and less disrupted market this year were quickly dispelled. With little more than 6 weeks to the start of open enrollment, it was pretty clear to those of us in attendance that there were still many more questions than answers.
So, over the next few days, I’m going to provide you with some important “Did you know?” points that I think you need to be aware of. Here’s the first installment:
Did you know…Additional complexities are expected in the enrollment process. Specifically, re-enrollment for those who signed on in the first year, i.e. those who qualified for subsidies in year one must re-qualify. And, more computer glitches are expected. Just yesterday the Wall Street Journal reports that in order to participate in any systems testing, insurance carriers must first agree to confidentiality of the testing process. Disclosure of testing results is strictly prohibited. There’s essentially a gag order for those carriers. Hmmmm. Color me skeptical but it sure doesn’t foster confidence that things will be improved this year. Also, makes one wonder if keeping it all hush-hush has anything to do with the upcoming mid-term elections.
Read 5 things we need to know before Obamacare enrollment starts again from The Washington Post.
Despite the fact that narrow networks continue to come under fire, we believe they will remain an integral part of the fabric of health plan options.
Narrow network strategies are employed by carriers as a means to control costs, offer lower-priced health insurance options, and still comply with new provisions of the Affordable Care Act such as medical loss ratio requirements and qualified health plan actuarial values. The rub with narrow networks is that while narrow networks can help lower premiums, they can also limit choice, access and potentially even quality. Plus, despite lower rates they can ultimately cost individual patients a lot more.
In the cases of these newly reported lawsuits, some docs that were originally listed as participating were dropped from the network. Patients were then faced with very high and unexpected medical bills from the newly out-of-network docs. Some enrollees sued the insurance companies claiming that the carriers failed to let them know that the docs were no longer participating.
For some, narrow networks can be the right choice, e.g. those who focus on monthly premiums above all else. While we believe that to be true, we’ll continue to bang the drum loudly that before selecting a narrow network plan, buyers need to do their homework. Know who is in the network and re-confirm participation before seeking care whenever possible.
Read Consumer Group Sues 2 More Calif. Plans Over Narrow Networks from The KHN Blog.
Last week I wrote about improving healthcare literacy. It’s an important and worthy goal. However, I always juxtapose this with something a highly respected physician colleague and friend said to me a few years back. It really resonated with me back then and still does today.
He said that the push for improving the public’s health literacy and increased consumerism is good. The more knowledgeable people can become about their healthcare the better. However, he also cautioned that the expectations of predicted great gains in cost savings and improved system efficiency from increased consumer knowledge were a bit unrealistic. They needed to be tempered. Healthcare is so dynamic and so complex that as a physician he had to really work hard to stay on top of best practices, new developments in medicine, the cost and outcome implications of various types of treatment, etc. His point was that if he, as an experienced physician with years of training and treating patients had to work so hard to stay on top of the latest developments and trends, then it is unrealistic to expect that consumers with day jobs and no medical training at all could understand the complexities of our healthcare system.
We know from years of analyzing data and our experience that the most experienced doctors with good teams around them deliver the best possible outcomes – clinical, functional and financial.
So I think the best bet – whether it’s you, your family members, or your employees – is still to do your homework and choose the best and most experienced doctors around.
Last week’s post in case you missed it…
Health Insurance Literacy: Too Complex For Some?
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- Tom Barrett
- September 19, 2014
- best, costs, experience, hospital, medical, outcomes, physicians, research, teams, treatment
- 0 Comments
We can all agree that our healthcare system is difficult to understand. Have you considered the confusion for people who have never had health insurance, or perhaps have not had it for a really long time? According to Drew Altman, president and CEO of the Kaiser Family Foundation, health insurance literacy is something that we as a society should work to improve. Here are some key points regarding the new insurance marketplace and ACA that Altman asks us to consider:
- 37% of enrollees don’t know the amount of their deductible
- only 46% of enrollees say they are getting a subsidy, when the official numbers indicate 85% are actually getting them
- many enrolled have no understanding of basic insurance terms like premium, deductible, copayment, coinsurance, maximum annual out-of-pocket spending, provider network, covered services, annual limits on services or excluded services
- people with lower incomes are less likely to understand the key elements of insurance (the people who need coverage the most understand it the least)
Altman also points out that people gaining new coverage are also expected to understand the intricacies of provider networks in the plans they choose, particularly if they have a health problem requiring specialty care. Otherwise, they’ll face high out-of-pocket costs when they visit out of network provider specialists. Understanding how drug coverage works is also important when dealing with tiers. Most of us understand that brand-name drugs cost much more than generics — but what about the folks who don’t know that? We all have a role to play to improve health insurance literacy. Unfortunately, as Altman points out in his article that appeared recently on WSJ’s Washington Wire, A Perilous Gap in Health Insurance Literacy, many of us get tested on our knowledge every time we access our health care plan.
Here are two info graphics that can help you get started with improving the health insurance literacy of the people you know:
We are the 90 by CommunicateHealth.com
The Facts about Health Literacy by Healthcare IT News
Recently the Obama Administration compromised to allow waivers for religious organizations to restrict paying for contraceptives on their health plans.
What does that mean for most religious groups that offer health benefits? Unless a group is self funded and writes their own plan, it will be difficult to change things. As we have discussed in earlier blogs posts, 98% of all employers purchase fully insured plans from insurance companies. Insurance companies file their plans and, for the most part, are abiding by the original requirements in ACA on what to cover. Therefore, if a group is fully insured, they cannot just change their plan.
It is possible that the insurance carriers may roll out plans that give these types of groups a chance to change their plan. However, at this point that is not possible and we usually see insurance companies move slowly on these events.
The administration rolled this out to allow for waivers. The carriers will probably wait and see if there are a lot of requests and then decide if they will react.
To read more on this topic, please read Administration Offers Contraception Compromise for Religious Employers, an article that appeared on WSJ Online.
In primary care, like many other things, bigger isn’t always better. And in the case of primary care physician practices, this study backs it up.
It’s no secret among those who know me well that I have a strong affinity for small businesses and have long held that small and mid-size businesses are the backbone of our country’s economy. In an age of instant gratification where many flip businesses like houses, I find more often than not that it’s the small businesses and their leaders that champion the vision of building and sustaining meaningful companies committed to serving their clients while consistently providing jobs for themselves, their families and others in their communities. And, it’s the small businesses and their leaders that consistently prove to be the innovators.
The study is titled “Small Primary Care Physician Practices Have Low Rates of Preventable Hospital Admissions” and was recently published by The Commonwealth Fund.
This study supports my notion and could also be instructive to you, your family and even your employees when it comes to selecting a Primary Care Physician geared to the combination of the best care AND the best cost…
“[T]he common assumption that bigger is better should not be accepted without question, at least in practices of 19 or fewer physicians,” the authors conclude. The authors also question the practice of insurers typically paying lower rates to physicians in smaller practices, which typically have no negotiating leverage. Such an approach may well be shortsighted, they say, since the lower preventable admission rates achieved by small practices compared with large groups can mean lower overall costs for patient care…”
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- Tom Barrett
- August 15, 2014
- ACA, advice, choosing, commonwealth fund, economy, employees, hospital costs, mid-size business, physicians, primary care, recommendation, small business, smaller, study
- 0 Comments
I wonder how much time and money employers have spent planning on the various dimensions of the Affordable Care Act (ACA) that died on the vine, have been changed, pushed back or remain so cloudy that no one really knows the correct answers. Do you think it’s enough to buy Las Vegas?
I have seen so many changes that the only thing I really know is that the guy who tells you how it is all going to look and has the blueprint on EXACTLY what you should do right now is the guy I will bet against – in Las Vegas or elsewhere.
So what should you do now about how to plan for the future and ensure you are compliant? That’s a very difficult question to answer. Here is what I think you should do:
- Don’t cave to fear mongers who say that prisons will be built all over the country to house ACA non-compliers. Compliance is important but so is having the courage to do the right thing for your employees.
- Remain aggressive on finding the best ways to take care of your people in the most cost-effective ways. If something is too edgy or pushes the edge of compliance, dump it. The ACA is a really big law and there is some wiggle room to think creatively.
- Any part of the law that is 12 months out may change. Avoid spending time on it now. If a brokerage house is hosting a seminar on a five-year plan, attend only if they are serving a fantastic free lunch.
- Keep asking good questions. The ACA rests on the understanding that American employers take good care of their people. Employers are going to be the ones to drive the innovation and provide the clear thinking on this law. If employers cave on providing health insurance solutions (even it is just guidance for their people) then the ACA is doomed. You should demand that everyone work hard thinking through the ACA and finding the best options possible.
- We have been deeply immersed in work with insurance advisory boards (of which BBG is a member), TPA experts at ODI and the federal regulators. It is believed among some that there will be an uptick in DOL audits. To that end, we at BBG are compiling all of the items an employer will need to provide. It is not a short list but we know what they will ask for and can step in to help. Our goal is to let you run your business and let us help with the things that you don’t do everyday (like provide cert to the DOL). Who knows if the DOL and other agencies will audit more groups, but if they do we will be ready to help.
Bonus (6). Don’t worry about this stuff in August. Washington is on vacation, so I don’t think they are!
If the healthcare picture wasn’t already muddy enough, now we have more bumps in the road ahead. Most of the press coverage and discussion over this past week has been focused on the subsidy ruling and where that’s headed. And, rightly so.
However, the domino effect may be equally impactful, maybe even more so. Expect the subsidy discussion to broaden and include the legitimacy and relevance of the Affordable Care Act (ACA) imposed coverage mandates and penalties – both for individuals and for employers.
If the subsidies are struck down, even temporarily, it stands to reason that mandates and penalties – both individual and employer – will also be called into question and perhaps disappear.
If in the majority of states subsidies are not available for eligible individuals, then the vast majority of individuals in those states would have no mandate to purchase coverage. It follows then that employer penalties in those states would effectively disappear.
By many accounts, the challenge to the subsidies is headed to the Supreme Court. Whether or not that really happens is up in the air and still anyone’s guess. If it does, then short of some sort of political resolution (possible but highly unlikely) we will have to wait at least a year or more for resolution. And, all bets would be off on the outcome.
Until then the subsidies remain available and mandates and penalties remain in play.
What does this mean for employers?
A sure signal of plenty more bumps in the in the healthcare road until things settle down with the ACA. Expect plenty of foggy conditions and winding roads under construction before any “new normal” sets in.
Make sure you pick the right driver when it comes to driving your health coverage bus.
Work with people that:
- Are keenly tuned in to what’s going on;
- Are savvy in understanding and interpreting your interests;
- Are not afraid to innovate, and
- Are nimble enough to help you make the right adjustments as conditions change.
You’ll need them to help you avoid any obstacles in the road, keep your employees protected and make sure the bus keeps traveling in the right direction.