General Health

No Charge For Preventive Care Services? Verify Up Front to Avoid Out-of-Pocket Costs, Billing Hassles Later

The healthcare reform law requires that most health plans now cover common preventive care services without costing covered employees or their dependents anything out-of-pocket. However, the type of preventive service covered at no charge can be a moving target, especially based on where the service is performed, who performs the service, and how it is billed by the provider.  Correcting preventive care services billed incorrectly by a provider is a real hassle.

A prime example is described in the recent Kaiser Health News article Consumers Expecting Free ‘Preventive’ Care Sometimes Surprised By Charges.

To avoid unwanted and unwarranted charges and the hassles of getting a bill corrected, first verify with your insurance carrier that the service your provider is recommending is a valid preventive care service (covered at a 100% with no associated out-of-pocket cost or copay).  They should also be able to give you the correct billing code that providers should use.  Secondly, and just as important, insist that the provider correctly bill the procedure as preventive.

Keep Your Doctor? Your Preferred Hospital? Do Your Homework Before Selecting A Plan.

With healthcare reform and the Affordable Care Act almost in full bloom, more potentially game-changing unintended consequences are starting to emerge.  One such consequence stems from the introduction of “narrow networks.” Initially intended for healthcare.gov or Exchange based products, most carriers have utilized the narrow networks to round out the low end of their 2014 individual and employer sponsored group plan offerings.

Employers changing plans in 2014 will have to pay closer attention to network selection. Or, potentially pay the price when you or your employees learn that preferred, familiar, closest and, in some cases, the best doctors and hospitals may not be in your plan’s network.

Until now, network size has not been a huge determinant in selecting carriers and plans. Most of the major insurance companies in the group market provided access to a vast selection of doctors and hospitals, especially those providers with the best reputations. With the advent of the Affordable Care Act and its impact on rate structures, benefits, and plan designs, carriers have less discretion on plan designs and rate setting. As a result, they are turning to these “skinnied” down networks as a primary means to manage costs, differentiate, and vary premium across their respective plan offerings.

In order to gauge the impact, I checked the online directories of two of the major group health plans in one large county in the Tampa Bay market where I reside. While decidedly informal and unscientific in nature, it nevertheless highlights the contrast.

I compared a few key categories of each respective carrier’s heretofore “staple” network (still offered; higher rates than the narrow network plans) against the new skinnier network offering (newly offered; lower rates than staple network plans). In both cases the “staple” networks contained a significantly greater number of providers, were described as open access, and did not require referrals. The new skinnier networks offered fewer participating providers, required designation of a Primary Care Provider (“PCP”), and required PCP referrals to obtain other services.

In comparing several categories of specialists, the narrow networks were on average comprised of about 50% fewer specialist physicians than the traditional networks.  However, the biggest difference between the customary networks and the newer narrower networks came when comparing participating PCPs and hospitals.  Here’s the breakdown:

Carrier 1

Carrier 2

OA Network

Narrow Referral-Driven  Network

OA Network

Narrow Referral-Driven  Network

Primary Care

1280

227

1300+

325

Hospital Primary and Secondary

12

3 (includes 1 major)

18

10 (includes 1 major)

We’ll be monitoring further developments, reporting more on this issue in future posts as well as discussing practical alternative strategies to this growing cost vs. access issue (eg. direct contracting, plan customization, buying a lower cost plan and supplementing, etc.).

In the meantime, what can you do?

When it comes to changing to new plans, look before you leap.  Or, at least plan on doing some homework.

To read more about this topic go to these recent articles in the Washington Post, Insurers Restricting Choice of Hospitals and Doctors to Keep Costs Down,” and at Health Care Policy and Marketplace Review, If You Like Your Doctor You Will Be Able to Keep Your Doctor. Period.”

Ezra says, “Healthcare.gov is in defacto shutdown.”

That is the title of Ezra Klein’s piece in yesterday’s Washington Post that indicates while the federal healthcare exchange is said to be open for business, it really isn’t.  Klein interviews highly respected health industry consultant Bob Laszewski who possesses up-close knowledge of the ballyhooed rollout of the federal health insurance exchange healthcare.gov. Laszewski and Klein provide some real, matter-of-fact insight and perspective on the utter chaos surrounding the rollout. Interestingly, while much of the latest news cycle highlights the many glitches associated with the exchange’s front end rollout, the article discusses even bigger problems that may loom on the system’s back end, if and when coverage is purchased and goes into effect.

Caveat emptor.

Read the entire piece at http://m.washingtonpost.com/blogs/wonkblog/wp/2013/10/23/healthcare-gov-is-in-de-facto-shutdown/

Healthcare Reform Explained (Sort of)

Here are the ABC’s of Healthcare Reform for Employers with Key Provisions Summarized…

Whether it’s in business meetings or in casual conversations at social gatherings, we frequently are asked “what’s healthcare reform all about” or “can you give me a simple explanation of ObamaCare“ or “ net out for us what we need to know about healthcare reform”.  Those in the business who eat, drink and sleep this stuff know that it’s nearly an impossible task to simply and succinctly explain this very complex piece of legislation that’s expected to work up a full head of steam in 2014.    Not wanting to back down from the challenge however, here’s our broad brush at netting out the key components for you in an understandable fashion.  We focus on key pieces already implemented and 7 main provisions pertinent to employers.

Some Provisions Already in Effect (grandfathered plans notwithstanding):

  • Coverage of 100% of cost of certain preventive care services
  • Ban on lifetime and annual limits on the dollar value of coverage
  • Dependent coverage to age 26
  • No cancellation of coverage, except in the case of fraud
  • New Summary of Benefits and Coverage documents from insurers; some additional reporting requirements for large employers
  • Minimum medical loss ratio (MLR) for insurers; rebates paid by insurers when not met
  • Changes to tax-free Flex Spending and Health Savings Accounts (e.g. OTC medications)

7 Key Provisions of Healthcare Reform Set to Take Effect in 2014:

  • Expansion of Medicaid

Eligibility/Coverage for individuals with incomes up to 133% of the Federal Poverty Level.  Individual states can decide whether or not to implement.  Some have rejected.

  • Guaranteed Availability of Health Insurance

Coverage cannot be denied for any reason such as health status, age, gender.

  • Individual Play or Pay Mandate

All individuals are required to have health insurance or be subject to a financial penalty.  Some exceptions to the mandate will be granted including such things as financial hardship, religious beliefs, member of Indian tribe, etc.

  • Employer Play or Pay Mandate (DELAYED UNTIL 2015)

“Applicable Large Employers” (50 or more full time equivalents) must offer full time employees (30 hours a week) with “minimum essential group health coverage” that is “affordable” or pay penalties.

  •  Subsidies – Two types
  1. Premium Subsidies (aka Premium Tax Credits) for those whose incomes fall between 133% and 400% of the Federal Poverty Level and are without access to other coverage
  2. Cost-Sharing Subsidies (Out-of-Pocket Costs) for those whose incomes fall between 133% and 250% of FPL and are without access to other coverage
  • Health Insurance Exchanges (HIX)
  1. Government sponsored (versus private exchanges sponsored by insurance companies and others and not addressed here) internet platforms that function as online marketplaces for certain individual and small group health insurance plans
  2. Administered in each state by either the respective State government; a joint Federal/State partnership; or, the Federal Government alone.  Majority of states have left it up to the Federal Government to implement the HIX in their states.
  3. Offering  4 levels of ACA-compliant health plans, to individuals and small businesses (small biz version also referred to as SHOP; implementation delayed in many states)
  4. Individuals eligible for Premium Tax Credits (subsidies) must purchase via the HIX

Well, there you have it.  Clear as mud, right?

It’s a complex law that’s generating thousands of pages of rules, regs, legalese, guidelines, FAQ’s –  you name it – from the likes of Health and Human Services, the IRS, and the Department of Labor.  It’ll impact most employers and their respective employees in some way, some much more profoundly than others.  And, it’s expected to cause to disrupt the market.

In the weeks and months ahead we’ll be working hard to cut through the morass and succinctly provide employers and other readers with as much practical clarity as possible.  We’ll be sharing what we’re doing, seeing, and hearing in the marketplace and the impact of the new healthcare law on businesses like yours and ours.   If there are things you’d like us to help you understand or anecdotes you’d like to share, please drop us a line and let us know.

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