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Walgreens Switches to Defined Contribution & Private Exchange Model

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Walgreens logo resized 600Walgreens has joined the ranks of thousands of businesses small and large, by announcing it will move to a Defined Contribution model for employee health benefits in 2014. Through the plan, Walgreens will allocate a fixed dollar amount for employees to purchase health insurance through a private health exchange. Employees will have a health insurance menu of 25 plans to choose from.

Walgreens' Defined Contribution and Private Exchange Model

Previously, Walgreens had two insurers offering two plans each (4 plan choices), now they have five insurance companies offering five plans each (25 plan choices).  This gives Walgreens' 160,000 employees choice on which coverage plan best suits their needs. It will also provide an opportunity for Walgreens retirees, who weren’t previously eligible for health care benefits, to participate in plans.

Defined Contribution and Private Exchanges vs. Self-Insurance

Currently, most large employers are self-insured, meaning that they take on financial risk of their employees’ health costs. So if one year everyone gets sick, and premiums increase as a result, the employer pays for it. With the defined contribution and a private exchange model, employers have more controllable health insurance expenses, because they provide a defined contribution to each employee and allow the employee to choose which plan best fits their need.

According to Walgreens, the company is providing the same funding for health insurance in 2014 as it does now.

Trend Away From Self-Insured Plans

Walgreens isn’t the only large company sending their employees to the private exchanges. International Business Machines Corp (IBM) and Time Warner Inc. have both moved their retirees to private exchanges from company picked plans. Sears switched to a defined contribution and private exchange model last year, Trader Joe’s Co. announced they will send its employees to the public exchanges for health insurance, and United Parcel Service (UPS) decided to drop health benefits altogether for 15,000 of its workers’ spouses. 

What do you think of Walgreens' move to a defined contribution and private exchange model? Leave a comment below.


Defined Contribution Guide

Feds Say ObamaCare Saved Consumers $1.2 Billion in 2012

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ObamaCare saved consumers $1.2 billion in health insurance premiums in 2012 via the rate review process. This is according to the U.S. Department of Health and Human Services (HHS) who recently released its Annual Rate Review Report. The report aims to show how the new rate review process saved consumers money on health insurance premiums in the last year.  HHS Rate Review

Overview of the Rate Justification Process and Analysis

The Rate Justification Process is a new Affordable Care Act (ACA or ObamaCare) rule that requires insurance companies to provide justification for rate increases and go through a formalized rate review before increasing premium rates 10% or more.

The new analysis from the Office of the Assistant Secretary for Planning and Evaluation (ASPE) of the rate review activities of 2012 shows that the rate review process saved consumers approximately $1.2 billion on their premiums, when compared to the original amount insurance companies requested via rate increases.

Savings in Individual and Small Group Market

The savings as a result of this review and justification process are said to have affected 6.8 million Americans. The individual market had an average rate increase drop of 12% (from 8.1% to 7.1%) after rate review, averaging out to savings of $311 million for individuals. The group market average rate increase decreased by 19% (from 5.8% to 4.7%) saving consumers an estimated $866 million.

In addition to the rate review process, the ACA requires insurers to spend at least 80% of their revenue on health care coverage (known as the 80/20 rule), and if they do not meet this requirement, they need to issue rebates for their shortfall. The issued medical loss ratio (MLR) rebates totaled to $500 million in 2012.

Fewer insurers submitted requests for rate increases of 10% or more in 2012, most likely a direct result of the ACA policy that requires these requests to be justified and reviewed.

Rate Review Grants

The ACA authorizes the Secretary to give grants to states who want to improve their rate review process. The law allows $250 million for rate review grants, and each state receiving a grant must submit data to the HHS documenting all rate increases requested by issuers in their state. In 2012, the Rate Review Grant Program granted $170 million to U.S. states, territories, and the District of Columbia for the rate review process.

Rate Justification Program

HHS has defined rate increases of 10% or more to be potentially unreasonable, and trigger greater scrutiny in the review process.  In 2012, the Rate Justification Program modified or rejected 28% of all rate increase requests of 10% or more in both the individual and small group markets, as shown in the charts below, taken from the report.

ratejust1 resized 600

ratejust2 resized 600

The Rate Review Process put into action by the ACA seeks to bring transparency and scrutiny to health insurance rate increases, and create a clear comparison for Americans. All rate change information is now available to the public, and issuers must provide justification of rate increases of 10% or more.

To read the full report see: Rate Review Annual Report (http://aspe.hhs.gov/health/reports/2013/acaannualreport/ratereview_rpt.pdf)

Ultimate Guide to Individual Health Insurance

5 Ways to Communicate Your Health Reform Strategy to Employees

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With key provisions of the Affordable Care Act taking effect soon, employers have been tasked with understanding health reform, deciding their health benefits strategy, implementing any changes, and communicating information to employees. The information you'll need to communicate to employees may vary by the size of your organization and what type of health benefits you offer employees, if any. Once you've determined what needs to be communicated, it's now time to decide how to communicate this to employees.five ways to communicate health reform employees

Here are 5 ideas on ways to communicate your organization's health reform strategy to employees.

  1. Share the "what" and "why" of your health reform strategy. If you're changing your organization's health benefits approach for 2014 (which is very common among small and medium businesses, and non-profits), communicate both the "what" and the "why" to employees earlier than later. Help employees understand what impact the Affordable Care Act has on the plans you offer, including who is eligible for coverage and which employees may need to explore the public exchanges and related health insurance tax subsidies. Tailor what you communicate to your health benefits strategy for 2014 and emphasize the benefits and opportunities for employees. In addition to this education, all employers are required to provide a notice about new coverage options with the health insurance exchanges, due by October 1. (Read more about the ACA Exchange Notice here.)

  2. Create a plan for distributing resources on basic health care information. Many employers are shifting how they offer benefits because of new opportunities with the Affordable Care Act. For most, this is a very positive change. And, in many cases it is a shift toward consumer-driven health care or defined contribution. Both of these models require employees to take more control of their health care. Employees may need resources and education about basic health care terms, and basic health care reform information. Create a plan and gather resources for employees. Who can they call with questions? How can your health insurance agent or benefits provider help? What resources can we provide employees? A packet of information, one-on-one meetings, and/or an all-employee meeting can help facilitate this exchange of information and provide a centralized time to answer questions or concerns.

  3. Refer questions about the individual health insurance exchanges or Medicaid eligibility to the exchanges. As part of the new health insurance exchanges, each state is required to provide educational resources and "navigators" to help employees understand the new coverage options and the health insurance subsidies. Employers should understand the basics of how the health insurance exchanges work, but don't need to keep up with all the complexities of what each exchange offers and which states are offering expanded Medicaid coverage. Provide employees with information to your state's exchange website (look it up here). Also, health insurance agents and brokers can register with the state health insurance exchange and are a helpful resource for employees in navigating coverage options, subsidies, and Medicaid eligibility.

  4. Leverage the attention on health care reform and the exchanges to educate employees on the benefits of health reform. Whether you love health reform or hate it (or lie somewhere in between), some of key provisions truly do benefit employees. These include guaranteed-issue policies on the individual health insurance market, health insurance subsidies to lower the cost of individual health insurance purchased on the new public health insurance exchanges, and all plans including 10 essential health benefits. 

  5. Reinforce the value of your health plans and the overall value of working for your organization. Regardless of the type of health benefits you are providing to employees, you likely care about the health of your employees and value offering employees health benefits. Use your communication about health reform as an opportunity to reinforce this value to employees.

What are your tips for communicating an organization's health reform strategy to employees? What has been effective for you? Leave us your tips or questions in the comments below.

Health Care Reform Checklist for Employers

US Census Report - 48 Million Americans Uninsured in 2012

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One of the key goals of the Affordable Care Act (ACA), according to the administration, is to increase access to affordable health care and help millions of Americans gain new access to more affordable health coverage and care. How will we know if it's working? To provide a benchmark, the US Census recently released a snapshot of health insurance coverage and uninsured rates in the US in 2012.uninsured americnas

The US Census report "Income, Poverty, and Health Insurance Coverage in the United States: 2012" found that 48 million Americans were uninsured in 2012, down from 48.6 million in 2011.

Here is a summary of the data showing how Americans purchase insurance, who makes up the uninsured Americans, and trends in health insurance coverage.

How Americans Accessed Health Insurance in 2012

The percentage of Americans without health insurance decreased from 15.7% in 2011 to 15.4% in 2012 (not statistically significant).

The number of people with private health insurance increased slightly in 2012 to 198.8 million, up from 197.3 million in 2011. Those with employer-based coverage rose slightly from 170.1 million to 170.9 million.

The percentage and number of people covered by government health insurance increased from 32.2% (99.5 million) in 2011 to 32.6% (101.5 million) in 2012.

health coverage by type of health insurance

Uninsured Rates by Age

Since 1999, the age group with the highest rate of uninsured adults has been 19-25 year olds. However, in 2012 the rate of uninsured 19-25 year olds was 27.2%; the same rate as adults age 26 to 34. 

The percentage of children (18 years and younger) in 2012 without health insurance decreased to 8.9%, down from 9.4% in 2011.

Uninsured by Age US Census

Uninsured Rates by Household Income 

The uninsured rate was higher among people with lower incomes and was lower among people with higher incomes. As the table shows below, the uninsured rate among those making less than $25,000/year was 24.9%. The uninsured rate among those making $75,000/year or more was 7.9%.

uninsured by income

US Census Definition of Insured and Uninsured

The report defined "insured" as someone who was covered by any type of health insurance for part or all of the previous calendar year. A person was considered “uninsured” if, for the entire year, they were not covered by any type of health insurance.

Charts and data source: US Census Income, Poverty, and Health Insurance Coverage in the United States: 2012

Thoughts or questions on the most current US Census report on uninsured Americans? Leave a comment below.

Employer Health Insurance Facts and Figures

Iowa Health Insurance Exchange Update - Health Plan Rates

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Recently, the Iowa Health Insurance Exchange released sample rates for individual health insurance exchange policies. According to the Iowa Insurance Division, the sample rates for individual health insurance plans are some of the lowest exchange rates in the country.Iowa Health Insurance Exchage

The Iowa Health Insurance Exchange will be Iowa's online marketplace where individuals and small businesses can shop for health insurance plans and receive access to ACA tax subsidies and credits. Iowa residents and small businesses can shop for plans starting October 1, 2013 at www.healthcare.gov. Plan coverage will start January 1, 2014.

Iowa Health Insurance Exchange - Sample of Individual Health Plan Rates

According to the Iowa Insurance Division, sample mid-range (Silver) individual plan premiums from the four carriers include:
  • CoOportunity Health: $172/month for a 21-year old, $267/month for a 45-year old, and $516/month for a 62-year old living in Des Moines, IA (non-tobacco user).

  • Avera: $280/month for a 21-year old, $404/month for a 45-year old, and $805/month for a 62-year old living in Crawford County (non-tobacco user).

  • Coventry: $175/month for a 21-year old, $254/month for a 45-year old, and $514/month for a 62-year old living in Des Moines, IA (non-tobacco user).

  • Gundersen: $306/month for a 21-year old, $467/month for a 45-year old, and $877/month for a 62-year old living in Iowa County (non-tobacco user).

Here is a detailed look at sample rates:


According to the Insurance Division, health insurance plan prices vary both between and within states, based on actuarial tables. Premium costs, the monthly amount an individual and/or an employer pays to an insurance company, may vary depending where someone lives in Iowa, their age, and their tobacco usage.

The state is divided into seven regions (see region list below). All plans through the Iowa Health Insurance Exchange will be categorized by Platinum, Gold, Silver, and Bronze tiers of coverage. For instance, a platinum plan will have a higher monthly premium but lower out-of-pocket expenses for medical care. With a bronze plan, the monthly premium will be lower but have higher out-of-pocket expenses for medical care.

The sample rates are premium rates before any applicable individual health insurance tax subsidies are applied. If eligible for the tax subsidies, the actual amount a person would pay would be reduced at the time of purchase. The tax subsidies are available for consumers with income four times the federal poverty line (making up to ~$45,900 for an individual and ~$94,200 for a family of four in 2013). For sample health insurance tax subsidy charts, see this article.

Iowa Health Insurance Exchange - Rate Regions

Iowa Exchange Counties

Source: Iowa Insurance Division

What questions do you have about the Iowa Health Insurance Exchange rates? Leave a comment below.

state by state guide to health insurance marketplaces

How the Affordable Care Act (ACA) Varies by State

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ACA varies by state JPGThe Affordable Care Act (ACA) is about to take a major step with the state health insurance marketplaces opening for enrollment on October 1, and with multiple ACA provisions coming into effect in January. 

This article provides a general overview on what parts of the ACA will affect everyone - regardless of where they live - and what parts of the ACA will depend on the state you reside in.

How the Affordable Care Act is the Same in Every State

The ACA requires every state to set up a health insurance exchange, also called a health insurance marketplace. States had the decision whether to set up their own exchange, partner with the federal government, or use the federally-run exchange.

Through these health insurance exchanges, individuals, families, and small businesses can register and enroll onto a health insurance plan. As part of the individual mandate, all US citizens will be required to be enrolled in a health insurance plan or pay a tax penalty in 2014.

In every state, the health insurance exchanges will be offering tax subsidies on premiums to those who meet certain income requirements. The eligibility requirements for the premium tax subsidies are the same no matter which state you live in. To see what these requirements are, and figure out if you are eligible for these tax credits see this article on premium tax subsidies.

All plans, regardless of state, will fall into one of five levels of coverage: Bronze, Silver, Gold, Platinum, or Catastrophic. Each of these levels is defined by the actuarial value of the plan, which is as follows:

  • Bronze: Plan pays 60%
  • Silver: Plan pays 70%
  • Gold: Plan pays 80%
  • Platinum: Plan pays 90%

All insurance plans offered through the health insurance exchanges will cover a set of 10 essential health benefits and will be guaranteed-issue. The only properties that health insurance companies will be allowed to vary premium rates on are: age, region, and tobacco use. Medical history and pre-existing conditions will no longer affect eligibility or prices of individual health insurance plans.

How the Affordable Care Act Varies by State

Even with all of these similarities, each person's experience will differ depending on which state you reside in. Here are three key differences of the ACA state-to-state:

  1. How the Health Insurance Exchange is run: As mentioned previously, each state had the option to design their own exchange, partner with the federal government, or default to the federally-run exchange. If your state is defaulting to the federally-run exchange model, then the exchange website (for employees, employers, and brokers) is www.healthcare.gov. If your state is running its own health insurance exchange, it will have its own website. Look up your state's health insurance exchange website here.

  2. Medicaid Expansion: Under the ACA states can decide whether or not they will expand eligibility for Medicaid coverage. The ACA proposed that Medicaid coverage expand to the entire population earning at or under 138% of the Federal Poverty Level (FPL). However, this Medicaid expansion provision was deemed unconstitutional in 2012. As a result, each state was given the choice to participate in Medicaid expansion or not. Currently, 22 states are expanding Medicaid. Look up your state's participation in Medicaid expansion here.

  3. Health Plan Availability and Cost: The availability and cost of health plans will also vary by state. Why? Each state has their own exchange, and different regional populations and demographics. Likewise, each state will have varying number of providers and number of plans. The prices of plans are going to differ depending on which state you live in, and even which region of your state you live in. Many states have sample health insurance exchange rates available, and all states will have final health plan rates available for comparison and enrollment beginning October 1, 2013.

What questions do you have about the Affordable Care Act and its impact state-to-state? Leave a comment below.

state by state guide to health insurance marketplaces

6 HR Tips for a Smooth Transition to the Health Insurance Exchanges

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transition to health insurance exchangeWith health reform taking full effect in 2014, most small and medium size companies will be sending a portion, or all, of its employees to the health insurance exchanges for coverage.

And it's not surprising. With the federal premium tax subsidies coming in 2014, guaranteed-issue individual health insurance plans, and the new health insurance exchanges, many companies are transitioning away from traditional group insurance (and the cost and complication that goes along with it). Other companies who have not offered health benefits in the past, will be communicating to employees about the health insurance exchanges to help employees receive access to coverage.

How can HR ensure a smooth transition? Here are six tips for HR in communicating a transition to the health insurance exchanges.

Tip #1: Provide additional information along with the required “Notice of Exchanges”

All employers are required to provide notice to employees about new coverage options with the health insurance exchanges. This notice is due October 1, 2013 and then at time of hire thereafter. The Department of Health and Human Services (HHS) has provided example notices with the information employers are required to provide under the Affordable Care Act. But why stop at this model notice? Supply employees with additional information tailored to your specific health benefits offering. Tell employees why they are receiving this notice, and what to do with it.

To read more about the notice see: Employer ACA Marketplace Notice Requirements.

Tip #2: Provide context on your health benefits plan

For many small and medium size companies, offering health benefits is a significant milestone. Help employees understand the specifics of the health benefit plan you are providing them. Explain what their benefits are and how the plan is going to work with the public health insurance exchanges and their individual health insurance plans (that they may already have). When employees understand the plan, and why the company is offering health benefits in this way, employees will be happier and it will contribute to the company's overall retention goals.

Tip #3: Communicate effectively to different types of employees

Will some of your employees benefit differently from health reform and the health insurance exchanges? For example, do you offer a different level of health benefits to full time vs. part time employees? Will certain groups of employees be eligible (based on income) for the premium tax subsidies, or Medicaid? If so, consider tailoring your health reform and health insurance exchange information differently to these different types of employees.

Tip #4: Clearly announce required actions and deadlines

All of this new information can be overwhelming and confusing for employees. Clearly define a timeline for them. This will not only keep them on track, but it will encourage a step-by-step method for them to get enrolled in a plan, and make it seem a easier and more manageable.

Tip #5: Welcome questions and provide additional assistance

Determine who will be designated to be the benefits ‘guru’ for questions and additional assistance. Plan out answers to questions you think your employees might have, and keep additional resources ready. No matter how well you explain everything, there are always going to be particular situations that are going to come up, and your employees are going to need help. Letting them know that there is someone who is constantly there to help them get set up, will make the transition easier, and most likely faster, with less mistakes.

Tip #6: Make sure leadership is on-board

Engage your company's leadership about the health benefits plan and strategy. While it's likely these leadership staff contributed to the decision, a refresher with these key managers can help the company maintain overall support and morale. The more cheerleaders you have for your health benefits approach, the more efficiently you will be able to implement it and more resources you will have for your employees.

What are your tips for ensuring a smooth transition to the health insurance exchanges, or a new health benefits strategy in general? Leave a comment below.

eBook: HR Professional\u0026#39\u003Bs Guide to Health Reform\u0026#39\u003Bs Tax Subsidies

Arkansas Health Insurance Exchange Update – Health Plan Rates

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ark resized 600The Arkansas Health Insurance Exchange, also known as the Arkansas Health Connector, recently released approved rates for individual health insurance plans which will be offered through their health insurance exchange. Plan enrollment will begin on October 1, and the plans will go into effect starting January 1, 2014. 

Arkansas Insurance Commissioner Jay Bradford announced the approved premiums were as much as 25% below the proposed rates and 10% lower than what forecasters predicted.

Arkansas Health Insurance Exchange – Carriers

Four insurance companies will be offering individual health plans through the Arkansas Health Insurance Exchange:

  1. Arkansas Blue Cross and Blue Shield
  2. The Multi-State Blue Cross and Blue Shield
  3. QualChoice
  4. Cantene

Together, these four carriers will offer 71 plans on the Exchange. The plans provided by these companies will be available for individuals and families buying insurance directly through the exchange, or through a broker registered with the Exchange. 

Arkansas Health Insurance Exchange – Approved Health Plan Rates

Below is a table provided by the Arkansas Health Connector showing the state average individual health insurance premium rates by age and tobacco use. All health insurance plans offered through the Exchange will be guaranteed issue, and premium rates are only allowed to vary according to age, family size, tobacco use, and region.

Ark1 resized 600

The above rates do not include discounts via the premium tax subsidies or cost sharing discounts that a large portion of the population will be eligible for. To find out more on tax subsidies see: Individual Health Insurance Premium Subsidies in State Exchanges.

For a full list of rates see: Qualified Health Plan Individual Premium Rates for Arkansas.

Arkansas Health Insurance Exchange – Regions

Arkansas will be divided into seven regions for Exchange premium rate purposes. These regions can be seen in the image below.

Ark2 resized 600

What questions do you have about the Arkansas Health Insurance Exchange rates and carriers? Leave a comment below.

Ultimate Guide to Individual Health Insurance

 


Illinois Health Insurance Exchange Update – Health Plan Rates

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describe the imageThe Illinois Health Insurance Exchange recently released information on premium rates for individual health insurance policies that will be available through the Exchange. The Exchange will open for enrollment beginning October 1, 2013 with plan coverage starting January 1, 2014.

Illinois residents will be able to access the Exchange in three ways: online, the state’s help desk, or by visiting a partner organization to obtain in-person assistance.

Illinois Health Insurance Exchange – Carriers

According to the Illinois Department of Insurance (DOI), eight insurance companies are planning to offer health insurance plans through the Illinois Health Insurance Exchange. The Illinois DOI and federal government have approved 165 plans from these carriers:

  1. Aetna Life Insurance Company
  2. Coventry Health and Life Insurance Company
  3. Coventry Health Care of Illinois, Inc.
  4. Health Alliance Medical Plans, Inc.
  5. Health Care Service Corporation, a Mutual Legal Reserve Company (Blue Cross)
  6. Humana Health Plan, Inc.
  7. Humana Insurance Company
  8. Land of Lincoln Mutual Health Insurance Company

Some of the plans will only be regionally available, however according to the DOI, 95% of all Illinois residents should have access to at least 34 individual health plans. 

Illinois Health Insurance Exchange – Sample Health Plan Rates

At time of writing there was not yet access to a full summary of premium rates for Illinois, however Illinois Governor Pat Quinn released sample bronze plan rates for residents in Chicago and Peoria, and examples of what premiums might cost with premium tax subsidy eligibility. In the press release, Governor Quinn states that rates for health plans are 25% lower than Health and Human Services (HHS) estimates, and that with premium tax subsidies these rates will be even lower for some residents.

  • The lowest monthly rate for a bronze plan for a 25-year-old is $120 in Chicago or $128 in Peoria 

  • The lowest monthly rate for a bronze plan for a 40-year-old is $152 in Chicago or $163 in Peoria 

  • The lowest and for a bronze plan for a 60-year old is $323 in Chicago or $346 in Peoria

For those eligible for the premium tax subsidies, consumers will pay even less toward their monthly premium. For example:

  • A single 30-year old with a household income of $23,000 could be eligible for a subsidy bringing his or her monthly cost to $44 in Peoria or $69 in Chicago

  • A family of 4, parents aged 40 with 2 children, with a household income of $60,000 could be eligible for a subsidy bringing their monthly cost to $150 in Peoria or $234 in Chicago

Source: Illinois.gov

What questions do you have about the individual health plan rates with the Illinois Health Insurance Exchange? Leave a comment below.

state by state guide to health insurance marketplaces

 

Health Insurance Marketplaces - Website Directory by State

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This state by state directory of the Health Insurance Marketplaces websites lists each state's Marketplace ("Exchange") and the website where individuals, families, and small businesses can view available plans and start to enroll on October 1, 2013. Coverage under Marketplace plans starts as soon as January 1, 2014.

Health Insurance Marketplaces Websites by State resized 600

 

State

Marketplace Name

  

Marketplace Website

Alabama

Health Insurance Marketplace

 

   www.healthcare.gov

Alaska

Health Insurance Marketplace

 

   www.healthcare.gov

Arizona

Health Insurance Marketplace

 

   www.healthcare.gov

Arkansas

Health Insurance Marketplace

 

   www.healthcare.gov

California

Covered California

 

   www.coveredca.com

Colorado

Connect for Health Colorado

 

   www.connectforhealthco.com

Connecticut

Access Health CT

 

   www.accesshealthct.com

Delaware

Health Insurance Marketplace

 

   www.healthcare.gov

District of Columbia

DC Health Link

 

   www.dchealthlink.com

Florida

Health Insurance Marketplace

 

   www.healthcare.gov

Georgia

Health Insurance Marketplace

 

   www.healthcare.gov

Hawaii

Hawaii Health Connector

 

   www.hawaiihealthconnector.com

Idaho

Your Health Idaho

 

   www.yourhealthidaho.org

Illinois

Health Insurance Marketplace

 

   www.healthcare.gov

Indiana

Health Insurance Marketplace

  

   www.healthcare.gov

Iowa

Health Insurance Marketplace

 

   www.healthcare.gov

Kansas

Health Insurance Marketplace

 

   www.healthcare.gov

Kentucky

 

kynect

 

   www.kynect.ky.gov

Louisiana

Health Insurance Marketplace

 

   www.healthcare.gov

Maine

Health Insurance Marketplace

 

   www.healthcare.gov

Maryland

 

Maryland Health Connection

 

   www.marylandhealthconnection.gov

Massachusetts    

Massachusetts Health Exchange

 

   www.mahealthconnector.org/

Michigan

Health Insurance Marketplace Exchange

 

   www.healthcare.gov

Minnesota

MNSure

 

  www.mn.gov/hix

Mississippi

Health Insurance Marketplace

 

   www.healthcare.gov

Missouri

Health Insurance Marketplace

 

   www.healthcare.gov

Montana

Health Insurance Marketplace

 

   www.healthcare.gov

Nebraska

Health Insurance Marketplace

 

   www.healthcare.gov

Nevada

Nevada Health Link

 

   www.nevadahealthlink.com

New Hampshire

Health Insurance Marketplace

 

   www.healthcare.gov

New Jersey

Health Insurance Marketplace

 

   www.healthcare.gov

New Mexico

BeWellNM 

 

   www.bewellnm.com

New York

 

New York State of Health

 

   www.nystateofhealth.ny.gov

North Carolina

Health Insurance Marketplace

 

   www.healthcare.gov

North Dakota

Health Insurance Marketplace

 

   www.healthcare.gov

Ohio

Health Insurance Marketplace

 

   www.healthcare.gov

Oklahoma

Health Insurance Marketplace

 

   www.healthcare.gov

Oregon

 

Cover Oregon

 

   www.coveroregon.com

Pennsylvania

Health Insurance Marketplace

 

   www.healthcare.gov

Rhode Island

HealthSource RI

 

   www.healthsourceri.com

South Carolina

Health Insurance Marketplace

 

   www.healthcare.gov

South Dakota

Health Insurance Marketplace

 

   www.healthcare.gov

Tennessee

Health Insurance Marketplace

 

   www.healthcare.gov

Texas

Health Insurance Marketplace

 

   www.healthcare.gov

Utah

Health Insurance Marketplace (Individual) and Avenue H (SHOP)

 

   www.healthcare.gov (individuals and families)

   www.avenueh.com (small businesses)

Vermont

Vermont Health Connect

 

   www.healthconnect.vermont.gov

Virginia

Health Insurance Marketplace

 

   www.healthcare.gov

Washington

 

Washington Healthplanfinder

 

   www.wahealthplanfinder.org

West Virginia

Health Insurance Marketplace

 

   www.healthcare.gov

Wisconsin

Health Insurance Marketplace

 

   www.healthcare.gov

Wyoming

Health Insurance Marketplace

 

   www.healthcare.gov

What do you think about your state Health Insurance Marketplace website? Leave a comment below.

state by state guide to health insurance marketplaces

Health Plan Rates for the 36 Federal Health Insurance Marketplaces

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A preview of the health plan rates for the federal Health Insurance Marketplaces is now available. Today, the federal authorities released sample premium rates for the 36 states who are using either the federally-run health insurance exchange model, or a partnership-based exchange model. While states have been individually coming out with their health insurance exchange rates, the report summarizes the health plan choices and premiums that will be available for the 36 states using the federal Health Insurance Marketplace. marketplace rates federal exchange

According to the Department of Health and Human Services (HHS), “premiums nationwide will … be around 16% lower than originally expected.” 

Final comprehensive rate listings will be available online (at www.healthcare.gov) on October 1, 2013. 

Marketplace Rates Vary Significantly by State

According to the report, the average premium nationally for a Silver-level plan is $328 per month for an individual. A Silver-level plan is a mid-range plan that covers 70% of covered medical costs.

For families, the average premiums vary widely by state. For example, a family of four will have an average monthly premium of $600 in Arizona, $961 in Indiana, $1,069 in Mississippi, $859 in New Hampshire, $943 in New Jersey, and $656 in Utah.

Some of the key factors influencing the differences premium prices include:

  • Insurance company estimated costs
  • A region’s labor costs
  • Amounts that hospitals and other regional facilities charge
  • Competition between insurers

These premium costs, however, are "sticker prices" and do not take into account the discounts consumers may receive with the premium tax subsidies. Administration officials say that with the premium tax subsidies, the same family of four with an income of $50,000 will pay $282 a month in premiums for a Silver-level plan. A 27-year-old individual with an annual income of $25,000 will pay $145 a month for a Silver-level plan.

Most Consumers Will Have Choice of 53 Health Plans

Gary Cohen, the director of the federal Center for Consumer Information and Insurance Oversight, says that consumers in the 36 states using the federal Health Insurance Marketplace will, on average, be able to choose from 53 health plans. In most states, plans are being offered by two or more insurance companies.

The highest insurance competition is seen in Wisconsin, with 13 carriers offering plans, while in New Hampshire and West Virginia, only one insurer will be offering plans through the Health Insurance Marketplace.

Most Americans Eligible for Subsidies

According to the Congressional Budget Office (CBO), 7 million Americans are projected to enroll in a health insurance plan through the individual and small business Health Insurance Marketplaces in the next coming year. Of these 7 million people, 6 million are expected to be eligible for premium tax subsidies because they do not have affordable employer-sponsored coverage and their incomes are within 100-400% of the Federal Poverty Level (FPL). That's equivalent to up to $46,000 a year for and individual, or up to $94,000 for a family of four.

According to HHS secretary Kathleen Sebelius, “six in 10 Americans who lack insurance will be able to find coverage that costs less than $100 a month.”

"Consumers Should Compare More Than Cost"

Because the cost of premiums is the most popular point of focus in the media lately, it is becoming the main source of comparison between plans. But consumers should be aware that there are other important factors to consider when choosing a health plan, and in the end, the plan with the lowest premium may not be the plan with the lowest overall cost for them.

For example, deductibles, out-of-pocket maximums, co-pays, and coinsurance are some other factors that can significantly affect health care costs, and these amounts should be taken into account when choosing a plan. For these reasons, it's recommended that individuals work with a health insurance broker registered with the Marketplace to compare and select a plan (and see: FAQ: Which Individual Health Insurance Plan Should I Choose?).

Federal Health Insurance Marketplaces - Example Rate Charts

FedExchange resized 600

Here is the full report and example rate charts.


Source: US Department of HHS

For a listing of health insurance exchange rates by state, see this article.

What do you think about the preview of Health Insurance Marketplace individual plan rates for these 36 states? What questions do you have? Leave a comment below.

eBook: HR Professional\u0026#39\u003Bs Guide to Health Reform\u0026#39\u003Bs Tax Subsidies

ObamaCare is Killing Group Health Insurance... Why It's Already Broken

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ObamaCare is killing traditional group health insurance. And as Paul Howard stated in a recent Forbes article, that’s probably a good thing. Why? Group health insurance is a BIG part of the healthcare problem. 

Group Health Insurance is Broken

Group health insurance is broken because you have an employer picking a one-size-fits-all group health insurance plan for employees. Employees have NO idea what their health insurance plan is or what it covers. As a result, most employees are scared of health insurance, and don't understand the basics about their coverage such as:

grouphealthinsurancebroken
  • Copays  
  • Deductibles  
  • Coinsurance  
  • Out of pocket max  
  • Networks  
  • The actual service they receive from healthcare providers

Perhaps this doesn't seem so absurd - it's the healthcare system we've had since WWII. But think about it. What if every time someone walked into a McDonalds:

  • They did not understand the menu,  
  • A third party selected their meal for them, and  
  • That same third party also paid the bill.  

What incentive is there for the customer to give feedback?   

What incentive is there for the restaurant to care what the customer’s feedback is?

What incentive is there for cost controls? 

This how our healthcare system works under the current group health insurance, employer-model… It's broken.

The Current (Employer-Based) System is Not Sustainable

The biggest symptom that our current, employer-based system is broken is the cost.

The average cost to cover an employee with group health insurance has increased from $2,196/year in 1999 to $5,884/year in 2013. For family coverage, the cost has increased from $5,791/year in 1999 to $16,351/year in 2013. This is not sustainable for employers nor for employees. 


The Solution - Defined Contribution Healthcare

To deal with these increasing costs, employers have already starting shifting their employee health benefits to consumer-driven and defined contribution models. ObamaCare, which introduces the health insurance marketplaces, guaranteed-issue individual health plans, and the premium tax subsidies accelerates this shift. Additionally, ObamaCare does little to address the root problem with group health insurance and the employer-model.

A "pure" defined contribution strategy offers a solution to the employer-model that is broken. With "pure" defined contribution, the employees:

  1. Pick the plan that best fits their needs, including the doctor

  2. Keep their plan for as long as they want

  3. Save money with new health care subsidies

Employers continue to offer a health benefits program that creates happy, loyal employees. 

Do you agree or disagree that group health insurance is broken? Join the discussion by leaving a comment below.

Defined Contribution Guide

17 Million People Eligible For Premium Tax Subsidies in 2014

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Everyone has a close eye on the new ACA Health Insurance Marketplaces, especially how many Americans will purchase a health plan through the Marketplaces and how many Americans will access the new premium tax subsidies. According to a recent analysis by Kaiser Family Foundation (KFF), an estimated 17 million Americans who are now uninsured or who buy insurance on their own will be eligible for premium tax subsidies in 2014. Additionally, 29 million people nationally may look to the Marketplaces to purchase health insurance coverage. Here's a look at the analysis of the premium tax subsidy eligibility, including eligibility by state.

17 Million People Eligible for Premium Tax Subsidies @ZaneBenefits

17 Million People Eligible for Premium Tax Subsidies

The analysis by KFF found that 17 million Americans are eligible for premium tax subsidies. Here's how they got to this number.

  • The analysis started with the pool of Americans who either do not have insurance or who purchase non-group insurance (individual health insurance, etc.). 

  • The analysis assumed that people who are covered by a public program or by employer-based (group) coverage will retain their coverage and would not be eligible for premium tax subsidies. 

  • Two other groups of people were then removed from the potential pool of tax-subsidy eligible individuals: (1) uninsured adults and children whose incomes would make them eligible for Medicaid or CHIP, and (2) people who are not legally residing in the United States. Neither group is eligible for premium tax subsidies under the ACA. 

  • For those remaining in the pool, KFF looked at their family incomes under ACA rules and the premiums that they would face for benchmark coverage to determine whether they would qualify for a premium tax subsidy. 

  • The vast majority of potential eligibles with incomes between 100% and 400% of poverty would qualify for premium tax subsidies.

  • Finally, KFF removed approximately 16% of potential eligibles because research shows that some people who are uninsured or have non-group coverage have access to employer-based coverage, either through an offer from their own employer or through an offer through a spouse or parent. 

  • Those that remained in the potential pool constituted their estimate of tax-subsidy eligible individuals. 

Based on these assumptions, KFF estimated that over 17 million Americans will be eligible for tax subsidies in 2014. 

Estimated Number of Tax Subsidy Eligible Individuals By State

According to the analysis, three states (Texas, California, and Florida) each have more than 1 million residents eligible for tax subsidies, and seven states have more than 500,000 residents eligible (Georgia, North Carolina, Ohio, Pennsylvania, and Virginia). On the flip side, seven states have fewer than 50,000 residents eligible, with the District of Columbia (9,500) and Vermont (27,000) having the fewest. The five states with the most tax-credit-eligible individuals account for about 40 percent of all such individuals nationally.

 

Number of Tax Subsidy Eligible Residents

Potential Market Size

National

17,187,000

28,605,000

Alabama

270,000

464,000

Alaska

55,000

78,000

Arizona

313,000

551,000

Arkansas

150,000

227,000

California

1,903,000

3,291,000

Colorado

254,000

501,000

Connecticut

109,000

216,000

Delaware

29,000

48,000

District of Columbia

9,000

36,000

Florida

1,587,000

2,545,000

Georgia

654,000

1,063,000

Hawaii

29,000

58,000

Idaho

130,000

202,000

Illinois

501,000

937,000

Indiana

354,000

525,000

Iowa

127,000

262,000

Kansas

161,000

298,000

Kentucky

192,000

302,000

Louisiana

344,000

489,000

Maine

77,000

122,000

Maryland

201,000

419,000

Massachusetts

118,000

259,000

Michigan

436,000

725,000

Minnesota

90,000

298,000

Mississippi

204,000

298,000

Missouri

386,000

657,000

Montana

97,000

152,000

Nebraska

122,000

239,000

Nevada

155,000

249,000

New Hampshire

81,000

137,000

New Jersey

400,000

628,000

New Mexico

118,000

193,000

New York

779,000

1,264,000

North Carolina

684,000

1,073,000

North Dakota

43,000

77,000

Ohio

544,000

812,000

Oklahoma

256,000

446,000

Oregon

187,000

337,000

Pennsylvania

715,000

1,276,000

Rhode Island

40,000

70,000

South Carolina

336,000

491,000

South Dakota

70,000

118,000

Tennessee

387,000

645,000

Texas

2,049,000

3,143,000

Utah

206,000

331,000

Vermont

27,000

45,000

Virginia

518,000

823,000

Washington

272,000

507,000

West Virginia

71,000

117,000

Wisconsin

301,000

482,000

Wyoming

47,000

80,000

Source: KFF analysis

According to Kaiser Family Foundation, the analysis used pooled data from the 2012 and 2013 Current Population Survey (CPS) Annual Social and Economic Supplement (ASEC). The CPS ASEC provides socioeconomic and demographic information that can be used for national and state estimates. Read more about the analysis methodology here.

29 Million Americans May Look to New Marketplaces for Coverage 

According to the analysis, 29 million Americans may look to the marketplaces for coverage. To get to this number, KFF made the following assumptions:

  • The potential market for coverage in marketplaces started with current non-group purchasers and uninsured people who are legally residing in the United States and who are not eligible for Medicaid or CHIP.  

  • They excluded two groups from among the current uninsured. The first group is people with incomes above Medicaid eligibility levels but below poverty, referred to as the gap group. They also excluded current uninsured people who are in a household of a full-time worker who either has or is offered employer-based insurance. As noted above, these people would be ineligible for premium tax credits, so the assumptions was made that they would choose employer-based coverage rather than non-group coverage if they choose to become insured.

According to KFF, the largest potential markets are in the states with the largest tax-subsidy eligible populations: California, Texas, and Florida. Six states have a potential market of more than 1 million people, and another 12 have a potential market of more than 500,000 people.

Where does your state fall? Leave a comment below.

Guide to Free Health Insurance Subsidies

Good News - One-Person Stand-Alone HRAs Allowed in 2014

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For over a decade, Health Reimbursement Arrangements (HRAs) have been widely used by small business owners and one-person non-profits as a way to increase their tax savings and to receive tax-free health benefits. However, recent regulatory changes around the use of stand-alone HRAs put a halt to most businesses and organizations using a stand-alone HRA (for plan years starting January 1, 2014).One Person Stand Alone HRAs in 2014 @zanebenefits

The good news is that stand-alone HRAs are still allowed under the ACA for one-person HRA plans. In other words, if your small business or non-profit stand-alone HRA only has one participant, you can continue to offer the stand-alone HRA in 2014 and beyond.

No Changes to One-Person Stand-Alone HRAs

On September 13, 2013 the Department of Labor released New Guidance on Tax-Free Reimbursement of Individual Health Insurance. The Technical Release 2013-03 clearly states that the new market reforms only apply to health plans with two or more participants:

"D. 1. Market Reforms – In General
The Affordable Care Act contains certain market reforms that apply to group health plans (the market reforms). In accordance with Code § 9831(a)(2) and ERISA §732(a), the market reforms do not apply to a group health plan that has fewer than two participants who are current employees on the first day of the plan year..."

The big takeaway is that for one-person stand-alone HRAs, there are no plan changes needed. One-person HRA plans may continue to reimburse for qualified medical expenses such as co-payments, deductibles, and personal health insurance premiums -- just as they do today.

How Business Owners & One-Person Non-Profits Benefit from Stand-Alone HRAs

One of the most common groups using a one-person stand-alone HRA are C-Corporation owners. C-Corp owners often set up an HRA for themselves to allow their business to reimburse them tax-free for personal health insurance, and write off the HRA reimbursements as a tax-deductible business expense. C-Corp owners may use the HRA to reimburse his or her medical expenses, as well as family medical expenses. A stand-alone HRA is an excellent option for tax-free business-owner health insurance. Read more about why HRAs are an ideal solution for C-Corp owners here.

Another group who commonly uses a stand-alone HRA in this way are one-person nonprofits and churches. For example, the organization will set up a stand-alone HRA to provide a health benefit to the Executive Director or Pastor. This is an excellent option for offering tax-free reimbursement of health insurance and medical expenses, and a way to provide key staff a health benefit without group health insurance -- which is often cost-prohibitive for the organization.

If you're a small business owner and file as an S-Corp, Partner, or LLC, read more about how you can use a stand-alone HRA for health benefits here: HRA Eligibility By Type of Small Business Owner

Do you have questions about how one-person stand-alone HRAs are compliant in 2014? Leave a comment.

Create Lovable Employee Health Benefits

Workplaces Taking on The Cost of Obesity with Weight Control Programs

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why obesity needs to matter to employers

It's a subject most people don't want to talk about openly, but the national epidemic of obesity presents significant problems for US employers. Obesity and its related diseases contribute to lost productivity, wage replacement, and increasing medical costs. All of these effects of obesity impact a business’s bottom line. Can employers play a role in mitigating these negative effects? While wellness programs and consumer-driven health plans address the growing problem of obesity, the question of how to provide effective help to overweight workers is a sensitive and challenging issue, and solutions remain to be discovered.

These are the issues, strategies, and conclusions discussed in the Northeast Business Group's "Weight Control and the Workplace" report released this week. The report provides a look at the scope of obesity in the US, how workplaces are taking on obesity through wellness and weight control programs, and how obesity is a growing challenge for US employers and employees.

The Impact of Obesity on Health Care Costs

Obesity is an epidemic in the US and one of the driving factors in the growing cost of health care. According to the report:

  • More than one-third of American adults are obese, a number that grows every year. 

  • Health care spending due to obesity is as high as $210 billion (in 2008 dollars), which is approximately 21% of total health care spending. If indirect costs are included, spending costs due to obesity are as high as $450 billion.

  • According to the CDC, chronic diseases such as arthritis, diabetes, and heart disease, which are linked to obesity, account for 75% of national health care expenditures.

  • More specifically, 95% of diabetics are type II diabetics, and of those, 55% are obese. Diabetes care costs the nation $147 billion annually. 

  • Each year cancer costs the US $200 billion and 4.4–7.5% of new cancer cases can be attributed to obesity. 

  • The CDC projects, if trends continue, that obesity rates will double by 2030 and rise even higher in some states, increasing expected spending by $48–$66 billion.

The Impact of Obesity on Employers

According to the report, overweight employees place a financial toll on employers.

overweight employees cost employers
  • Overweight employees cost their employers $73.1 billion a year and file twice the number of workers’ compensation claims. 

  • The average medical claims cost per 100 employees is $51,019 for obese employees, compared to $7,503 for non-obese employees.

  • Obese men take six more sick days a year than non-obese men. Obese women take 9.4 more days a year than non-obese women. The resulting obesity-related absenteeism costs employers $6.4 billion/year.

  • 67% of employers identified employees’ poor health habits as one of their top three challenges to maintaining affordable health coverage.

Strategies to Curb Obesity in the Workplace

The prevalence of obesity has a direct cost to employers and many employers see the opportunity to curb obesity. After all, employees spend 55% of waking hours at work. Through wellness, specifically weight control programs, employers are looking to influence healthy behaviors to keep health care affordable and to contribute to employees’ long-term health and well-being. So, what are we talking about? According to the report, three examples of popular wellness and weight control strategies include:

  • Lifestyle modification programs - onsite Weight Watchers, onsite workout areas, standing or treadmill desks, healthy foods in vending machines, etc.

  • Competition - Weight-loss or fitness competition across the company.

  • Incentives -  Reward employees for participating in a health risk assessment, disease management program, weight loss program, smoking cessation program, etc.

Can Workplace Weight Control Programs Make a Dent in Obesity?

The report emphasizes that for workplace weight control programs to make a difference, the program needs to have:
  • Leadership support for the program - financially and culturally.

  • Employee engagement - weight control programs only work when the employees most in need participate.

  • A positive brand - market the program with employees to grow awareness, build trust, and create a buzz.

  • A business case - make sure all activities are benchmarked and measurable, so you can report ROI to the company.

Will these programs have an impact on obesity in the workplace and across the nation? The report makes the following recommendations for the future success of workplace weight control programs:

  1. Weight control programs need to be customized, and incorporate employer leadership, employee engagement, program branding, business case development, and clear definitions of success. The program needs to adapt and best fit the needs and resources of each employee and each organization.

  2. Employee engagement is key, including employees involvement with designing, rolling out, and optimizing the weight control program. Employee involvement help reaches the people who most need these programs.

  3. These programs will only have impact if they are leveraged across the country. Therefore, scale and adoption is important. Addressing how employee obesity and weight control programs can be scaled according to employer size and needs is important for adoption and sustainability.

For the full report see Northeast Business Group on Health's website.

What do you think - as more workplaces take on obesity, will weight control programs work? Have you implemented a weight control program? Has it worked? Leave a comment below.

Employer Health Insurance Facts and Figures



16 Ways to Inspire Small Business Leadership [3 Infographics]

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You've started your business and it's off the ground running. You've hired your first employee/s. Now it's time to lead your business, and employees, to success. It's not always easy. In fact, sometimes it feels like an upward battle.

Need a little inspiration? Here are three infographics on inspiring leadership, with 16 practical tips to take your leadership to the next level:

  1. Face your challenges
  2. Win trust
  3. Be authentic
  4. Earn respect
  5. Stay curious
  6. Have humility
  7. Identify the behaviors that should be developed
  8. Ask for feedback
  9. Take a behavior-modeling class
  10. Try cross-training
  11. Be courageous
  12. Be accountable
  13. Communicate masterfully
  14. Possess conviction
  15. Collaborate
  16. Align strategically

Disclaimer: The views represented in these infographics do not necessarily reflect the views of Zane Benefits, its staff, or its affiliate partners.

5 Keys to Inspiring Leadership, No Matter Your Style

5 keys infographic inspiring leadership resized 600

Source: Entrepreneur Media

5 Ways to Be an Exceptional Leader - Focus on Strengths

ways to be an exceptional leader infographic cortez papercut open forum resized 600

Source: Open Forum 

8 Key Leadership Qualities

leadership qualities cmoe resized 600

Source: Center for Management and Organization Effectiveness (CMOE) 

What are your tips for inspiring leadership? What types of qualities are needed to lead a successful small business? Leave a comment below.

Create Lovable Employee Health Benefits

    Zero-Net-Premium Plans Widely Available... And Other Preliminary Health Insurance Exchange Trends

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    We're one month in to the health insurance exchanges, and after three and a half years of forecasting data is now emerging on the individual health insurance exchanges across the nation. These trends point at the impact of the Affordable Care Act (ACA) on the health insurance industry, as well as on individual Americans. The McKinsey Center for U.S. Health System Reform recently released an early report analyzing 21,000 unique qualified health plans filed on the state public health insurance exchanges, in all 501 rating areas in the 50 states and District of Columbia.

    Their analysis focuses primarily on the plans available, carriers and new entrants into the individual health insurance market, and cost analysis.

    4 Preliminary Trends of the Health Insurance Exchanges

    The McKinsey report outlines five trends from their analysis of the first two weeks of the individual health insurance exchanges (through October 15, 2013):

    1. The competitive landscape in the individual market has changed considerably, given the number of new entrants (80 new carriers).

    2. These new entrants are pricing competitively, but are not usually price leaders.

    3. Premium levels vary considerably, both within and across markets.

    4. Zero-net-premium products are widely available.


    1. The Competitive Landscape of the Individual Market is Changing

    According to the report, 80 new carriers have entered the individual market, ranging by state from 1 new carrier to 17. Nationwide, new entrants represent 28% of all carriers on the exchanges and 16% of all products offered.

    competition on market

    competion by state resized 600

    Source: McKinsey

     

    2. New Entrants Pricing Competitively, But Usually Not Price Leaders

    According to the report, new entrants are pricing competitively, but usually not the price leaders. Nationwide, about half the new entrants’ plans are priced below the median in their respective markets. And, about a third the new entrants’ plans are within 10% of the lowest-price plan.

    pricing trends by carriers resized 600

    Source: McKinsey

     

    3. Premium Levels Vary Considerably

    According to the report, in most rating areas large variations in pricing are present within and across metal tiers. The report pointed to several factors contributing to these pricing differences within a given rating area including degree of network narrowing, different costs of care, and different assumptions about risk pool (i.e., morbidity of expected membership).

    pricing variation by area and tier resized 600

    Source: McKinsey

     

    4. Zero-Net-Premium Products Widely Available

    According to the report, 6 to 7 million Americans may be eligible for a zero-net-premium bronze plan, and about 1 million Americans may be eligible for a zero-net-premium silver plan. In other words, the federal premium subsidy covers the entire health insurance premium. How does this work? Here is an example the report provides:

    "... consider a 42 year old single female living in Jackson, Mississippi earning $23,000 a year (200 percent of the federal poverty level). For her income level, the maximum premium she is expected to pay is 6.3 percent of her income, or $121 a month. Because the second-lowest silver plan available in her rating area is $425, the federal premium subsidy for her is $304. If she chooses to buy the lowest-price bronze product (priced at $236), the “net premium” for her is zero because it is priced below her subsidy."

    zero net premium plan accross US resized 600

    The full report and analysis is available here: McKinsey Center for US Health System Reform.

    Which of these preliminary health insurance exchange trends stand out to you? Leave a comment below.


    Individual Health Insurance Marketplace Overview Webinar

    15 Signs You've Freed Yourself From Group Health Insurance

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    We write a lot about how group health insurance is broken and how defined contribution health benefits are the future of small business health insurance.

    So, how do you know you've officially freed yourself from group health insurance? Here's 15 lighthearted ways HR changes after implementing pure defined contribution health benefits.

    1. It's renewal time and you're not stressing about whether you'll have to select a new plan, and at what price tag. 

    dont stress about annual renewals

     

    2. Your boss just gave you the high five in the hallway for keeping health care costs controllable.

    high five from boss

     

    3. Your employees are knowledgeable about individual health insurance, and use this knowledge get more value out of their health benefits.

    knowledge is power

     

    4. You spend less than 5 minutes per month administering the health benefit -- and all of a sudden have more time for those big strategic projects that have been on your to-do list for way too long.

    Nailed It

     

    5. When your boss asks you for a "quick" report on liability, cost, and utilization you happily say "I've got it right here" (rather than lock yourself in your office for an hour).

    that was easy

    6. Your "health benefits" file folder just went from taking up the whole top cabinet to a tidy folder alphabetized appropriately under "h".

    no more paperwork

     

    7. You no longer have to explain to upset employees why the one-size-fits-all plan you offer doesn't cover their family doctor.

    one size fits all

     

    8. You no longer dread the time it will take to call the insurance company. Because you never(!) need to call them on behalf of the company again. 

    please hold

     

    9. Your employees take you out for happy hour because their health benefits are being increased this year -- not decreased.

    this guy

     

    10. An employee is confiding in you about an upcoming medical procedure or pregnancy, and you're not secretly thinking "oh great, what is this going to do to our health insurance rates next year?"

    im listening

     

    11. You just recruited and hired that hard-to place senior program manager because your health benefits package rocks.

    hired that important manager

     

    12. You love seeing your health insurance broker at the office, because you know he/she is helping employees find the perfect health plans.

    brokers help employees find perfect plan

     

    13. You just got a round of applause at the board meeting. For the first time.

    board meeting props

     

    14. It's employee enrollment time and you just saved the company five reams of paper because you simply enrolled employees online.

    large image savepaper

    15. A beloved employee is retiring early, and you're no longer worried that she won't have health insurance coverage or will have to pay exorbitant COBRA premiums.

    feeling of freedom

     

    What ways do you know you've freed yourself from group health insurance by offering defined contribution health benefits? Leave a comment below.


    Small Business Guide to Health Insurance Allowances

    The 4 New Health Reform Rules All Small Businesses Need to Know

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    2014 is almost here. But don't panic. While the new Affordable Care Act (aka ACA, health reform, ObamaCare) regulations seem overwhelming, the new insurance rules fall into four main categories of insurance reforms. Understand these new coverage and benefits rules, and your small business is well on its way to being prepared for 2014. 

    1. New Rules for Coverage

    2. New Rules for Pricing

    3. New Limits on Cost-Sharing

    4. New Benefits Covered

    Read on for an explanation of these new rules. 

    key health reforms that small businesses need to know

    Image Source: Washington Council Ernst & Young

     

    These rules take effect January 1, 2014 (unless otherwise noted below).

    New Rules for Coverage

    Health reform created new rules for coverage for individual health insurance and employer-based health insurance. These include:

    • Guaranteed-issue coverage - all individuals must be accepted regardless of health conditions (this is a major change to the individual health insurance market)

    • No pre-existing condition exclusions - insurance companies are no longer allowed to deny coverage to patients for a certain time period because of medical conditions that existed when coverage began

    • No rescissions of coverage - insurance carriers are no longer allowed to cancel coverage because you neglected to report a medical condition

    • 90-day waiting period limit - a group health plan may not use a waiting period that exceeds 90 days

    New Rules for Pricing

    Health reform created new rules for pricing of health insurance premiums.

    • No medical underwriting - insurance carriers are no longer allowed to use medical or health information to set the premium rate for the policy

    • Premium rate review -  health insurers must justify any rate increase of 10% or more before the increase takes effect (2011)

    • Premium prices can vary only by age, smoking status, geography, and family size (and these price variations are controlled) 

    New Limits on Cost-Sharing

    Health reform created new rules for cost-sharing, in other words how much a covered individual pays for coverage when they receive medical care.

    • Standard metal tiers - to make understanding coverage levels easier, "apples to apples"

    • Limits on deductibles and out-of-pocket costs - The new out-of-pocket annual limits are $6,350/year for individuals and $12,700/year for families (starting 2015), and deductibles are limited to $2,000/year for individual plans, and $4,000/year for family plans.

    • No annual or lifetime limits placed on essential health benefits (started phasing in in 2010)

    New Benefits Covered

    Health reform created new rules benefits that health insurance covers.

    Small Business Requirements Under Health Reform

    In addition to these new health reform rules on coverage and benefits, there are regulations impacting small businesses. What are your requirements as a small business?

    Health Care Reform Checklist for Employers

    How to Successfully Implement Defined Contribution Health Benefits

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    Implementation of a new health benefits program is key to its success. Educating and onboarding employees in a positive way makes plan management more successful in the short-term and in the long-term - and creates benefits that both the business and employees love.successfully implement defined contribution health benefits

    Your business has gone through the process of researching health insurance options, selecting a pure defined contribution health benefits model, designed your perfect plan, and completed setup with your defined contribution software provider.

    The final (and perhaps most important) step is to implement the defined contribution health benefits. In the implementation phase, your business will enroll employees, educate employees, and prepare payroll for reimbursing employees.

    Here are five easy steps to successfully implement defined contribution health benefits. (These steps don't necessarily need to be completed in this order.)

    Implementation Step #1: Enroll Employees

    implementation step 1   enroll employees

    After setting up your defined contribution health benefits and downloading your Section 105 HRP plan documents, the first step is to enroll employees online.

    With defined contribution software, this is a simple task of entering basic personal information and enrolling them in their employee class.

    Read more about defined contribution software here.

    Implementation Step #2: Educate Employees 

    After you enroll employees, your defined contribution software provider should provide you a custom tool kit to educate employees on:employee education defined contribution

    • The benefits of a defined contribution health benefits (e.g. What is an HRP? How does their health insurance allowance work?)

    • The benefits of individual health insurance (e.g. vs. group health insurance)

    • How to request premium reimbursement and take advantage of the benefit

    • How to get questions answered if they have them

    Because even though defined contribution health benefits and individual health insurance are growing in popularity, many employees are not familiar with having an allowance to spend on their own policy.

    For this reason, look for a defined contribution software provider who:

    • Provides a custom on-boarding process 

    • Provides an instant, electronic way to send Welcome Kits to employees

    • Provides an online help and support center with tutorials for employees and the business

    • Has a responsive support team knowledgeable about defined contribution, individual health insurance, and health care reform

    • Provides a link to a broker or quoting system so employees can easily have access to health insurance options

    All of these activities (and features) will contribute to employees understanding the health benefits -- and create happier employees.

    Implementation Step #3: Provide a Health Insurance Broker to Help Employees Select Plans

    Choices

    With "pure" defined contribution health benefits, employees purchase their own individual health insurance. For some employees, this is a new experience. Providing a health insurance broker or consultant to help employees select and purchase plans will help guide employees through the application process. This will also help employees choose plans that best fit their individual or family needs, such as keeping the same network of providers and balancing their premium with out-of-pocket costs.

    Implementation Step #4: Plan for Reimbursements

    First, decide how your business will issue reimbursements to employees. Common ways include on payroll, direct deposit, or by separate check. Then, set up a line item in your payroll system. If using a Section 105 HRP as the foundation of your defined contribution health benefits, the line item will be classified as a tax-free business expense reimbursement.

    Your defined contribution software provider should integrate with any payroll system, and using a software platform reduces health benefits administration to 5 minutes per month-- you'll simply add approved reimbursements to paychecks.

    plan for HRP reimbursements

    Implementation Step #5: Communicate with Employees Early-On & Frequently

    communicate with employees about defined contribution health benefits

    How and what you communicate to employees varies by company. But as a rule of thumb, keep the communication open between HR and employees, and check in frequently. Many businesses make assumptions about what employees prefer or understand when it comes to benefits. By keeping communication open, you can address questions early-on in the transition, and measure their overall satisfaction in the long-term.

    For more on employee education and onboarding see: Employee Education - Maximizing the Success of a New Health Benefits Program.

    What are your tips for implementing defined contribution health benefits?

    Defined Contribution Health Plans Buying Guide

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