HEALTHCARE
Exchange Plans Block Access Mental Health Drugs
Health exchanges have made it hard for patients to get medications for mental health, according to a recent fact sheet from Pharmaceutical Research and Manufacturers of America (PhRMA). The following are excerpts from a fact sheet from the organization:
We have seen a number of states where there are barriers to getting meaningful coverage for the medicines that physicians prescribe. We’ve seen a significant amount of aggressive utilization management, particularly for classes like anti-psychotics. We see placement of medicines on the highest (4th and 5th) tier where medicines face not a copay, but coinsurance. High cost sharing can often be a significant barrier; and we’re very concerned with that. We’ve also seen aggressive use of step therapy and “fail first,” in which an individual patient has to fail first on a particular compound before getting access to the one their doctor prescribed. That’s concerning because treatment failure can be very complicated for someone living with mental health disorders. Even when a patient rebounds, they may never get back to where they were. We have real concerns about high use of step therapy and prior authorization in these exchange plans. We’re hearing the most complaints about the use of step therapy and prior authorization.
For more information, visit catalyst.phrma.org.
Allowing Mid-Sized Employers to Delay a Move to the Small-Group Insurance Market
A provision in the Affordable Care Act that could have a strong impact on small and mid-sized employers, reports the Commonwealth Fund. Historically, states have defined their small-group markets as groups of two to 50 employees. But, beginning January 1, the Affordable Care Act expands the definition of small employer to have two to 100 employees. Experts say this change could drive up premiums for some mid-sized employers with 51 to 100 employees. They will become newly subject to several small-group market reforms, such as not charging people more for preexisting conditions and covering a minimum set of essential health benefits. Some policymakers have called for the delay or repeal of this provision.
While it is unlikely that the Obama Administration will unilaterally delay this requirement, there is a transitional policy for mid-sized employers. States can decide whether to allow mid-sized groups to remain part of the large-group market for up to two more years. Not all states will permit transitional relief for mid-sized employers including California, Colorado, Connecticut, Maryland, Minnesota, Nevada, New York, Vermont, and Washington.
Many states are concerned that expanding the small-group market could lead to significant disruption, including premium increases for employers with young or healthy groups. This could give some employers an incentive to self-insure or even drop employee coverage. If too many young, healthy groups leave the market, adverse selection could cause premiums to increase for the employers that remain. For more information, visit cmwf.org.
The Costliest Catastrophic Claims Conditions
Sun Life Financial has released its third annual Catastrophic Claims Report, which compiles the top 10 costliest medical conditions covered by stop-loss from 2011 to 2014. The data can help brokers and employers understand how large claims can affect a self-funded medical plan.
Cancer remains the costliest disease. It accounts for 26% of the $2.1 billion that Sun Life paid out to stop-loss claimants over four years. The top conditions, which include cancer (malignant neoplasm and leukemia/lymphoma/multiple myeloma) and end-stage renal disease, made up 34% of total reimbursement costs. Intravenous medications accounted for 13% of the total stop-loss claims paid during 2014. About half of the top 20 intravenous medications identified in the report are used to treat cancer, and represent nearly $25 million in treatment costs in 2014 alone. Individuals with claims in excess of $1 million remain a major driver of stop-loss payments. Cancer, congenital anomalies, and premature births account for 28% of all claims breaching the $1 million mark. Download the full report at bit.ly/slfcatastrophicclaimsreport2015).
Bill Would Expand Access to Home Healthcare Services
The Partnership for Quality Home Healthcare is urging Congress to advance the Home Health Care Planning Improvement Act (S.578). Under the bill, nurse practitioners could certify home health services for Medicare beneficiaries without getting physician approval. Nurse practitioners are already certified to perform such evaluations for hospice services. Eric Berger, CEO of the Partnership said, “Allowing nurse practitioners to certify patients for Medicare’s home health services would remove barriers to care that restrict access to patient-preferred healthcare for homebound beneficiaries. The Partnership commends Senator Susan Collins and her colleagues in the U.S. Senate for sponsoring this legislation, which would improve access to skilled home healthcare for Medicare’s most vulnerable patient population, particularly those patients living in underserved and rural parts of the country.” For more information, visit homehealth4america.org.
Consumers in Grandfathered Plans Can Face Higher Costs for Preventive Benefits
Reprinted from the Kaiser Health News (www.khn.org).
by Michelle Andrews June 9, 2015
Judy Naillon called her insurer several months ago to find out why she was being charged $35 every month for birth control pills. Her friends said they were getting their pills for free under the federal health law. Why wasn’t she getting the same deal?
The insurance rep explained that was because the plan Naillon and her husband had through his job was grandfathered under the health law. That meant the plan didn’t have to cover preventive services, including contraceptives, with no charge to consumers as Obamacare requires of other plans.
Naillon, 33, would have to continue to pay a share of the cost of her pills, and the plan wouldn’t pay if she wanted to switch to an intrauterine device. There also was no coverage for an annual physical.
“I’m just really frustrated,” says the Wichita, Kan., piano and violin teacher. When her husband took a new marketing job last fall, I thought that surely all these insurers must now be covering these benefits.
About a quarter of insured workers remain covered by grandfathered plans, according to the Kaiser Family Foundation. (KHN is an editorially independent program of the foundation.) These plans were in existence when the health law was enacted in March 2010 and haven’t changed their benefits or consumer costs significantly since then.
In addition to not being required to cover preventive benefits without charge, grandfathered plans are exempt from some other health law requirements. They don’t have to guarantee members’ rights to appeal a decision by their health plan, for example, and may charge consumers higher copays or coinsurance for out-of-network emergency services. They also don’t have to comply with the law’s limits on annual out-of-pocket spending ($6,600 for someone in an individual plan and $13,200 for families), so consumers in these plans may be on the hook financially for more of their medical care.
When the health law passed, President Barack Obama sought to reassure anxious consumers by promising that if you like your health care plan, you can keep it. Since then, the number of grandfathered plans has steadily declined. In 2011, 72% of companies that offered health insurance had at least one grandfathered plan; by 2014 that number had declined to 37%, according to KFF’S annual employer health benefits survey. The decline isn’t surprising, say benefits experts.
Large employers make changes every year to improve care and reduce costs, says Steve Wojcik, vice president of public policy at the National Business Group on Health, an advocacy group representing large employers’ interests.
“Some big self-funded companies may keep generous grandfathered plans as a recruiting and retention tool, says Joe Kra, a partner and actuary at human resources consultant Mercer. Smaller employers are more likely than large ones to be grandfathered at this point,” Wojcik says. Small firms typically buy a plan from an insurer that pays their claims, unlike larger companies that often design their own plans and pay their employees’ claims directly.
Some health policy experts have two words for the demise of grandfathered plans: Good riddance. Lacking many consumer protections and generally subject to weaker regulation, they aren’t necessarily good options for people who have health problems.
“But they can be a good deal for younger and healthier people. Grandfathered plans are more likely to hang onto people who are low risk,” says Sarah Lueck, a senior policy analyst at the Center on Budget and Policy Priorities. However, on the individual market, if healthy people stay in grandfathered plans, it tends to leave sicker people in the comprehensive plans that comply with the health law.
From an employee’s perspective, what grandfathered plans may lack in consumer protections they may make up for in reduced cost sharing, Kra says.
In order to retain their grandfathered status, for example, plans are limited in how much they can increase copayments and deductibles, among other things. That means if someone had a $20 copayment in 2010, the copayment could be no more than $26 next year, Kra says. Likewise, a $500 deductible could be no more than $652.
“If an employee is in a grandfathered plan, they’re one of the fortunate minorities,” Kra says. Naillon probably wouldn’t agree with that statement. “Even though my doctor would like to do a physical and run labs, I can’t afford to have those services,” she says.
NEW PRODUCTS
Client Relationship Management Database
OptifiNow has designed a sales automation tool to facilitate compliance, generate more leads, and increase customer numbers for brokers. OptifiNow automatically alerts agents and brokers when messaging needs to be sent out and what to send and how. It offers the flexibility to customize the messaging to a particular customer. Additionally, OptifiNow offers a deep integration with Salesforce.com and other CRM systems. For more information, visit optifinow.com.
PlanSource Heath Exchange Adds MetLife
PlanSource, a cloud-based health exchange, has added MetLife. Consumers have access to 11 MetLife product lines including basic and supplemental life, dental and vision, accident, hospital indemnity, and critical illness. For more information, visit plansource.com.
WebInsure Health Exchange Adds Carriers
WebInsure Benefits has added carriers to its cloud-based exchange including Kaiser Foundation Health Plan of the Mid-Atlantic States, Reliance Standard, and WageWorks. The carriers offer a range of benefits for individual and group markets – medical, dental, vision, short-term disability, long-term disability, life, accidental death & dismemberment insurance, FSAs, HSAs, HRAs, COBRA, commuter & parking reimbursement accounts, identity protection, wellness, and other programs. WebInsure is available in all 50 states. For more information, visit hcentive.com.
FINANCIAL PLANNING
IRA Contributions Are Up
Fourteen percent of those who own an IRA contributed to their account in 2013, up from 12% in 2010, according to a report just released by the Employee Benefits Research Institute (EBRI). Those with traditional IRAs contributed 5.2% in 2010 and 7% in 2013. Those with Roth IRAs contributed from 24% in 2010 and 26% in 2013. For more information, visit ebri.org.
Financial Stress Hits Low- and Middle income mothers the Hardest
Financial stress is hitting low- and middle-income mothers the hardest, according to a report by www.financialfinesse.com. Fifty-five percent of women ages 30 to 55, with household incomes of $60,000 or less, who have minor children report high or overwhelming financial stress. This is 40% more than similar-aged male parents in the same income group. In every age group, women are more likely to report significantly higher financial stress than men. Age also contributes, as do income and parenthood.
Twenty-six percent of men under 30 report no financial stress. Women seem to feel less control over their financial situation than men do. In 2014, about two-thirds of users in the company’s education programs were women. To get the report, visit goff.im/2015_Fin_Stress_Research_Fin_Finesse.
Money Transfers Flow to the Young
When family members help each other out, it’s mostly older family members helping out younger adult relatives, according to a study by the Employee Benefit Research Institute (EBRI). Sudipto Banerjee, EBRI research associate and author of the report said, “For the older households, cash transfers can reduce their retirement assets, raising concerns about retirement security, particularly for low-income groups. Although cash transfers are more prevalent in high-income households, a significant percentage of low- and middle- income households transfer cash as well.”
From 1998 to 2010, there has been an increasing trend of transfers going from older (50 and above) households to younger family members. Only 4% to 5% of older family members get cash transfers from their families compared with those who transfer money (38% to 45%) to younger family members.
The amount transferred from older Americans to their children and grandchildren generally goes down with age. From 2008 to 2010, $8,350 was the average amount transferred from households age 50 to 64; and $4,787 was the average transferred from for households ages 85 or above. Higher-income households are much more likely to transfer money to their family members. Also, older households that transfer cash have much higher income and assets than those that don’t. The full report, “Intra-Family Cash Transfers in Older American Households,” is published in the June 2015 EBRI Issue Brief, which is online at ebri.org.
IN CALIFORNIA
California Is the Only State to Delay Public Disclosure of Proposed 2016 Rates
Covered California has successfully lobbied the federal government to delay public disclosure of qualified health plan rate change proposals for 2016, Consumer Watchdog reports. In a letter to Peter Lee, executive director of Covered California, Consumer Watchdog said that residents of every other state now have access to proposed rate hikes, except the people of California. “Your unusual lobbying of the federal government to make an exception for California in disclosing rate hikes raises significant questions about the exchange’s need for secrecy. You can put these issues to rest by making California health plans’ initial proposed rate changes public,” wrote Jamie Court, president of Consumer Watchdog, and Carmen Balber, executive director.
The letter continued, “The people of California are entitled to see the proposed rate changes for 2016 prior to any modifications (increases or decreases) that Covered California’s intervention may inspire. You have previously acknowledged that Covered California’s approach to balancing its various interests does not always result in the lowest possible rate for each carrier. In addition, industry sources have suggested that Covered California has previously asked some regional insurance companies to raise their rates in order to be more in line with Anthem Blue Cross, a favored carrier at the exchange. How can the public judge what kind of deal Covered California is getting for members if the initial rate proposals are not posted?” For more information, visit consumerwatchdog.org.
Sheryl McLamb joins EPIC in Sacramento
Edgewood Partners Insurance (EPIC) announces that Sheryl McLamb has joined as an account manager in EPIC’s Private Client Group. McLamb will be based in Sacramento as EPIC expands its private client services. She will provide individual risk management and insurance portfolio services to high net worth individuals in Sacramento. McLamb has more than 20 years of experience in client-focused positions in the insurance, legal and financial services industries. Before joining EPIC, McLamb was most an account and client services manager with Albano, Dale, Dunn & Lewis Insurance Services in Orangevale, Calif.
Ruiz Mitilier Joins EPIC in Southern California
EPIC Insurance Brokers and Consultants announced that Vanessa Ruiz Mitilier has joined the firm as a senior consultant and producer in EPIC’s Southern California employee benefit consulting practice. She will be responsible for new business development and the design, implementation and management of employee benefits programs for her clients. She will report to Tiffany McClellan, CEBS, Southern California regional director of Employee Benefits and will be based in EPIC’s Irvine office. Ruiz Mitilier joins EPIC from Mercer, where she spent the past three years as a senior associate and sales professional.
LIFE INSURANCE & ANNUITIES
Life Happens Honors Insurance Agents for Exemplary Client Service
Insurance nonprofit organization, Life Happens, announced the winners of its annual Real Life Stories Client Recognition Program. The following are stories of agents who won the award for 2015:
- Lars Hansen, LUTCF, American National, Mesa, Ariz.: Jason and Nicole Sherman purchased life insurance through their agent, Lars Hansen. Hansen met with the couple each year to adjust their coverage. In 2005, after checking to see if anyone was hurt in a freeway accident, Nicole Sherman was struck and killed. An individual life insurance policy allowed Jason Sherman to spend time with his daughters without worrying about his family’s financial stability. To see more, watch the video at lifehappens.org/sherman.
- James Jacobs, CLU, ChFC, AXA, Chesterfield, Va.: At 27, Michael Sizemore was training for his first marathon and starting a job as a lobbyist. As a new employee, Sizemore was eligible for his employer’s benefit program, which agent James Jacobs had established. Sizemore took full advantage of all the benefits. Through Jacobs, he also purchased individual insurance policies, including disability insurance with Ameritas. Just a year later, Sizemore was hit by a drunk driver, leaving him in a medically induced coma. The group health insurance paid his hospital medical expenses. The individual disability insurance gave him enough income to continue living his life and paying for physical therapy, despite being unable to work. To see more, watch the video at lifehappens.org/sizemore.
- Juli McNeely, LUTCF, CFP, CLU, McNeely Financial Services, Inc., Spencer, Wis.: Sam and Amy McNeely purchased life insurance from agent Juli McNeely. Sam died suddenly at 38 from a dissected aorta. Life insurance policies with Mutual Trust Financial Group, Auto-Owners Life Insurance Company, and EMC National Life that Juli helped set up, have prevented Amy and her daughter from facing financial hardship. To see more, watch the video at lifehappens.org/mcneely.
- Craig Wiklund, CLU, ChFC, Wiklund & Bond Financial Services, Auburn Hills, Mich.: Craig Wiklund helped advise his close friend and small business owner client, John Gongos to develop a succession plan for his company and purchase life insurance policies with Voya Financial and AXA. At 51, just two weeks after his diagnosis of Stage 4 Melanoma, John died, leaving his wife, kids, and devoted employees in shock. Thanks to John’s insurance policies, his wife Anne and their three children were able to stay in their house, and his business was able to keep running. To see more, watch the video at lifehappens.org/gongos.
This year’s four Real Life Stories honorees, along with their clients, will be recognized at the National Association of Insurance and Financial Advisors (NAIFA) annual conference in New Orleans later this fall. A presentation ceremony will take place on Sunday, October 4, 2015.
Starting June 23, the 2015 Real Life Stories will be available to insurance agents and advisors, along with new Life Insurance Awareness Month marketing resources, via the new Life Happens Pro website at lifehappenspro.org.
Annuity Insurers Change Their Marketing & Distribution Priorities
Insurers are refining their social media and content marketing strategies in response to an evolving distribution landscape, according to a study by Conning. Competition among insurers for traditional advisors continued to grow in 2014 and into 2015, said Scott Hawkins, a vice president of life-annuity, Insurance Research at Conning. The number of insurance agents and registered representatives surpassed the record levels in 2008. However, the number of broker-dealers decreased for the fifth consecutive year, which may hurt variable annuity sales. The number of potential consumers, per advisor, decreased again in 2014, so insurers need more advisors to reach the same number of consumers. At the same time, these conditions increased competition among advisors.
Steven Webersen, head of Insurance Research at Conning said that insurers are focusing on refining their social media and content marketing strategies. While marketing initiatives continue to shift from traditional to digital, industry expenditures are rising as insurers seek growth in an improving economy. In 2014 large insurer groups increased their marketing expenditures 9%, midsized groups increased expenditures 8%, and smaller insurers increased expenditures 14%. For more information, visit conningresearch.com.
