Archive by Month - October, 2010

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IRS’ Affordable Health Insurance Reform Implementation in Danger

Wednesday, October 27th, 2010

Image: numberstumper under CC 3.0

Understandably, most people aren’t huge fans of the IRS. For the most part, Americans communicate with them when they’re taking money out of their pockets during tax season. However, a provision of the new healthcare reform law has the Internal Revenue Service actually attempting to give money back!

The law is meant to make affordable health insurance more widely available through tax credits to small businesses that provide coverage to their employees. Doing so will require more manpower and resources for implementation and enforcement of the program. Some Republican candidates are considering defunding the IRS and other agencies involved to stifle healthcare reform, since it is predicted to take $5 to $10 billion for each agency to fully implement it.

Congress has the power to do so, and does not require President Obama to sign off on a repeal he would be guaranteed to veto. Ironically, one of the most business-friendly provisions may suffer as a result.

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Athletes Struggle To Find a Health Insurance Plan

Tuesday, October 26th, 2010

Image: Studio Finch under CC 3.0

Intuitively, most marathon runners and other serious athletes would be a good bet for health insurance plan providers. They are extremely fit, making them less likely to develop chronic health conditions like diabetes. On the other hand, they are actively working towards better health.

However, there’s a catch in that model of an ideal investment: injuries. So far, health insurers have reserved the right to deny coverage based on pre-existing conditions, and a severe injury or accident could qualify. Either the policy will cover everything except treatment related to the injury, or they will be denied a policy altogether. (The healthcare reform law looks to end this in 2014.) In addition, even minor sprains or other injuries require doctor’s and hospital visits, driving up health insurance costs.

On the bright side, many distance runners buying individual health plans tend to be on the young side, making their coverage cost less.

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Stay Vigilant With Your Health Insurance Benefits

Monday, October 25th, 2010

Image: Mike Sansone under CC 3.0

If you have generous health insurance benefits provided by your employer, you may not think about it that often. For the most part, you choose the most affordable health insurance option that fits your needs during the open enrollment period and then run on autopilot.

Unfortunately, it seems that sticking your head in the sand isn’t good enough. Teachers in several school districts in New Jersey were recently uninsured for several months. A clerical error meant that although premiums were taken out of their paychecks, premiums were not paid to the insurers for four months.

Teachers in Newark still haven’t had their coverage restored. However, Paterson teachers are luckier–all covered expenses that occurred during that period will be paid for, and their coverage was reinstated.

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Health Insurance Company CEO Retiring

Friday, October 22nd, 2010

Image: Listphile

Health insurance companies are going through many changes at the moment. For Aetna, this is just one more: their CEO, Ronald A. Williams, is stepping down from that role next month. (He will retire from the company entirely early next year.) Williams was the chief executive officer since 2006, and was in charge of the lucrative segment of health insurance plans during a period of soaring costs.

Who will replace him? Aetna President Mark T. Bertolini is being promoted to fill the gap. Bertolini will also have a seat on the board of directors. However, Williams will still be involved as a consultant on healthcare reform issues until February 2012. He will receive $20,000 a month for those services, in addition to a retirement package valued at over $7 million. (Presumably, his health insurance is fully covered.)

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State Health Insurance Commissioners To Rule on Medical Loss Ratios

Thursday, October 21st, 2010

Image: turtlemom4bacon under CC 3.0

All eyes are on Orlando today, but not because of anything Mickey Mouse has done. Rather, it is a meeting of several states’ insurance commissioners. Their topic: coming up with the rules that insurers will have to abide by post-healthcare reform.

Specifically, they are responsible for calculating minimum medical loss ratios. MLRs are also known as the percentage of premiums spent on providing health care, as opposed to profits and administrative expenses. Proponents of the limits believe that they will result in more affordable health insurance for consumers. However, some are worried that the new rules will make some niches and entire markets–such as small groups–less appealing, and that people will become uninsured as a result.

The group’s recommendations will become effective next year. Although the already-determined limits are 85% for large group plans and 80% for small groups and individuals, the commissioners will consider tax exemptions and a longer phasing-in period. Most significantly, they will help determine what counts as a medical expense. Insurers obviously want a wider definition of qualified medical costs.

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Boeing’s Health Insurance Plans Becoming Less Attractive To Employees

Wednesday, October 20th, 2010

Image: X-Ray Delta One under CC 3.0

In order to combat continually rising health care costs, many companies are changing their benefits packages to transfer more of the expense onto employees. Boeing is no different.

According to human resources senior VP Rick Stephens, co-payments, co-insurance percentages, and deductibles will go up next year. One of their health insurance plans will have its co-insurance percentages soar to 20% from 10% in 2012. About 90,000 employees will be affected.

Union employees are exempt, because they have their own negotiated contract. Many are speculating that the healthcare reform law has something to do with it, which the aircraft manufacturer denies.

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Virginia Judge To Rule on Health Insurance Mandate on New Year’s Day

Tuesday, October 19th, 2010

Image: USA Today

Those hoping for a quick resolution to the lawsuits seeking to overturn a portion of the Obama administration’s healthcare reform law are out of luck. At least one of the suits–the one filed by Virginia–will take longer to resolve. According to U.S. District Court Judge Henry E. Hudson, he will rule on whether the affordable health insurance mandate provision is constitutional on January 1st.

If Hudson determines that the state’s Attorney General Ken Cuccinelli II has a case for the federal government overstepping its boundaries, the challenge will be one step closer to the Supreme Court. Since Virginia has its own specific law forbidding anyone from mandating that its residents purchase health insurance, it filed a lawsuit separate from the class action joined by over 20 states.

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McDonalds, Other Businesses Exempt from Healthcare Reform Law

Monday, October 18th, 2010

Image: DRB62 under CC 3.0

There has been much concern surrounding healthcare reform’s impact on businesses. Many are worried that employers will drop their health insurance plans altogether, rather than complying with new requirements that increase the standard of care.

However, 30 companies and unions–McDonalds is the most popular–have received an exemption from that provision. The waiver must be renewed by Secretary of Health and Human Services Kathleen Sebelius each year until 2014. HHS made the judgment that rather than risking companies discontinuing seasonal and temporary workers’ health coverage entirely, it makes more sense to allow them to retain the inferior mini-med plans with extremely low annual limits of coverage. This will be the case for several years, until the health insurance exchanges are fully operational to give such employees more options.

Other firms are protesting this move, because small businesses will suffer while the big names with lobbying influence can get around the unfavorable provision.

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Do Health Insurance Stocks’ Profits Hurt Patients?

Friday, October 15th, 2010

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According to financial analyst Sarah James, the health insurance industry is a great investment. Profits are estimated to be higher in the third quarter of 2010, so firms like Aetna, Coventry, UnitedHealth, WellPoint, and Humana have had their price targets increased.

Unfortunately, what is positive for stockholders may not be as good for health insurance plan customers. One of the reasons for lower costs is a milder flu season than expected, which is obviously good for everyone. Increased enrollment is another explanation, which is generally neutral. Another, more worrying, factor is price increases.

Lower usage rates of costly inpatient hospital services could go either way: if the decline is because patients are truly becoming healthier and don’t need them, that’s great. However, if it is a result of insurers forcing patients into outpatient care before they are ready to cut their costs, it is not a good sign for consumers.

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