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Will Marketplace Customer Service Be On A Par With Private Industry?

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One of our clients recently told us about a health insurance plan that was being marketed to him, and we were curious enough to want to look into the situation further.  In a nutshell, it’s not a discount plan, not a mini-med, and not a traditional limited-benefit indemnity plan.  All of those plans should be avoided in general, and the ACA has sort of skirted around them a bit:  numerous mini-meds have been granted temporary waivers in order to continue to operate, discount plans aren’t addressed by the ACA at all (and aren’t regulated by most state Division of Insurance departments either, since they aren’t actually insurance), and limited benefit indemnity plans are exempted from ACA rules (although people who have them will likely have to pay a penalty for not meeting minimum benefit requirements).

Anyway, the plan that was marketed to our client resembled traditional health insurance, but was very convoluted and sold with numerous riders to cover all sorts of different scenarios.  The brochure was 27 pages long and included numerous detailed examples showing how awesome the marketed coverage was when compared with “traditional major medical.”  It noted that the plan isn’t subject to ACA mandates, and the policy is still being marketed with a $5 million lifetime maximum.  When I spoke with an agent for the plan (a captive agent, of course – plans like that are never marketed by brokers who have access to other policies), he told me that the policy will not be guaranteed issue next year, and that they aren’t concerned about the potential penalties that their clients will have to pay starting in 2014 for not having ACA-compliant coverage.  His reasoning (and the marketing pitch that they’re making to their clients) is that their premiums will be so much lower than ACA-compliant plans that their clients will save enough money to more than make up for the penalty (currently their premiums were roughly the same as those of reputable health insurance policies).

In short, everything about this policy sounded sketchy.

health insurance marketplaces (aka exchanges) customer service vs private industryA rather lengthy Google search didn’t bring up much in the way of regulations pertaining to this sort of issue.  I remembered my efforts in the fall of 2011 to get specific details about regulations regarding mini-meds… and I wasn’t encouraged.  At the time, the Colorado Division of Insurance wasn’t aware of a solution to the problem our client was facing (although to give them credit, I was able to speak with someone as soon as I called them).  They referred me to HHS, where I had to leave a voice mail.  The outgoing message said that someone would get back to me within five business days, but that was a year and a half ago and I’m not holding my breath for a reply.  I also left a message for the National Association of Insurance Commissioners (NAIC) about the issue and never heard back from anyone there.  We ended up getting the client onto an Anthem Blue Cross Blue Shield plan, but we never heard back from any of the government agencies we contacted regarding his mini-med situation.

So back to our current questions about the sketchy-sounding health insurance being marketed to our client.  I contacted HealthCare.gov via Twitter but got no response.  I called the Colorado Division of Insurance and was told that I should send in an email with the specifics.  I did that on Wednesday and haven’t heard anything back from them yet.  I called them this morning to follow up, and they told me that they had received my email but didn’t know to whom it had been assigned yet – this is two days after I sent it, so I would assume that perhaps the employees there are overworked and understaffed.  I didn’t contact the national HHS office again, because I didn’t feel like wasting my time any further.  However, I did send an email on Friday morning to the regional HHS office in Denver, so hopefully I’ll hear back from them sometime soon.

I’m also hopeful that I’ll hear back from the Colorado DOI sometime next week.  They usually end up being a helpful – and local – resource, even if we have to wait a few days.  Once we get some more information, I’ll write a follow-up post about how an individual carrier is apparently able to operate entirely outside the regulations of the ACA.

But for now, I’m struck by how difficult it can be to obtain information from a government agency, or even speak with a real person as opposed to just leaving a message or sending an email that may or may not ever get read.  I know that private companies aren’t always shining examples of customer service, but I can’t imagine calling the claims or customer service number on the back of our Anthem Blue Cross Blue Shield card and being told […]

Individual Health Insurance Premiums And The ACA

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Chris Fleming hosted the Inauguration Edition of the Health Wonk Review this week at Health Affairs Blog, and it’s an excellent compilation of articles.    The article written by one of our favorite bloggers, Maggie Mahar, about health insurance premiums in 2014 and beyond caught my attention, because that’s an issue we’ve been watching closely for some time.  It’s a question that’s on a lot of minds right now – especially for people who buy their own health insurance and are in the segment of the population that is most likely to experience changes (in coverage, premium, how policies are purchased, etc.) in 2014.  Jay and I not only work in the individual health insurance industry, but we’re also policyholders – we’ve have individual health insurance since 2003.  We’ve had two carriers and several plan designs over the last decade, and we’ve experienced double digit percentage rate increases nearly every year (somewhat offset by the fact that we’ve been willing to increase our deductible and out-of-pocket limits several times).

We currently pay just over $400/month (for our family of four) for an Anthem Blue Cross Blue Shield CoreShare plan with a $3500 deductible and another $3500 in coinsurance.  We know that our rate will go up in the fall – it always does – but how much?  How much will prices go up for all of our clients who are covered by all of the biggest health insurance carriers in Colorado?

Individual Health Insurance Premiums and the ACAI don’t know the answer to that question.  And I don’t think that anyone really does.  The post Maggie wrote references an article from Bob Laszewski that predicts rate increases of 25 – 50%, with some rates actually doubling, while Maggie’s prediction is more along the lines of a price decrease for people who qualify for subsidies, with an average price increase of just over 10% for those who don’t (anyone making more than 400% of FPL).  The answers seem to change based on who’s doing the math, and it would be disingenuous to say that all of the numbers are objective.  In general, I’ve found that the people who support the ACA are more likely to predict small rate increases and smooth sailing next year, while those who oppose the law are likely to predict large rate increases and general doom and gloom.

Here’s what I do know.

The MLR (medical loss ratio) has already been in effect for two years.  Carriers have had to limit their overhead to 15 – 20% of premiums since […]

Individual Health Insurance After Donating A Kidney

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This recent AARP article caught my attention last week.  My father lost his kidneys in 2001 as a result of Wegener’s Granulomatosis, a rare autoimmune disease.  In August, he was the recipient of a kidney generously donated by the family of a young man who had passed away.  And this fall, for the first time in 11 years, he’s been able to go about his life without being tethered to a dialysis machine every evening.  So I’m drawn to stories about kidney transplants, living donors, or families who choose to donate a deceased loved ones organs.

To sum it up, Radburn Royer is a healthy 57 year old who donated a kidney to his daughter four year ago, after her own had failed as a result of lupus.  Prior to donating a kidney, Royer was covered by Blue Cross Blue Shield of Minn.  It’s unclear what his health insurance status was in the interim, but last year he reapplied for coverage with them and Individual health insurance kidney donorwas turned down.  He’s appealed several times, but for now he’s covered by his state’s high risk pool (he has to pay $130 more per month for his coverage and has a higher deductible, both of which are common in high risk pools).

Individual health insurance in Colorado is underwritten just as it is in Minn., but underwriting guidelines usually vary from one state to another and from one carrier to another.  So we contacted three of the top individual health insurance carriers in Colorado to see how they would underwrite an applicant who had previously donated a kidney.  Cigna, Humana and Anthem Blue Cross Blue Shield all said that as long as the donor had been released from medical care and had normal blood pressure and blood lab results, the most likely underwriting outcome would be acceptance with a standard rate.

At first glance, this seems to be at odds with the situation experienced by Royer, but maybe it’s not.  The AARP article notes that Royer underwent […]

[…] In the context of kidney donation, it’s important that potential donors not be inadvertently scared off by AARP’s article.  Kidney donors are heroes – anyone who had received a transplant will attest to that fact – and they save lives.  The study that I linked to above followed donors for 20 – 37 years after their transplants.  While some donors did end up having kidney problems, the majority had normal kidney function 20 – 37 years out from surgery, and would likely not have a problem obtaining individual health insurance, even prior to it being guaranteed issue in 2014.  Most people who are healthy enough to be accepted as a donor will continue to be healthy after they donate a kidney.

I wish my health insurance _____________?

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I understand the trade off we got when we switched to a really inexpensive high deductible plan when even our high deductible HSA qualified plan was too rich and expensive. So I wish my health insurance had a monthly credit card billing option. Our current health insurance company, Anthem Blue Cross of Colorado used to have it, like most health insurance companies did. But then, like most other companies also did, they stopped offering that as an option about a year ago.

What would you change about your health insurance company or plan? It could be the coverage, billing, customer service, anything…

No 2013 CoverColorado Assessment

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CoverColorado announced that there will be no assessment in 2013 on Colorado health insurance carriers. The 2012 assessment was roughly $3.79/month/contract for individual/family insureds.

Anthem Blue Cross of Colorado has also announced that their membership this year was higher than expected this year. They were making up for a shortfall by charging $4.36/month/contract in 2012. Due to the higher enrollment, Anthem BCBS has enough funding to satisfy December without billing subscribers a CoverColorado assessment.

How Does Health Care Reform Impact HDHPs and HSAs?

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Will HSA qualified health insurance plans and Health Savings Accounts (HSA) still exist after the majority of the remaining PPACA changes are implemented in 2014?  That’s a question that we often hear from Colorado health insurance clients who are concerned about their existing HSA qualified high deductible health plan (HDHP)/HSA, as well as people who are considering an HDHP but uncertain about the future of that type of health insurance.

In terms of direct impact, the PPACA changes very little about HDHPs and HSAs.  There are only two […]

Primary Care Practices In Colorado Chosen As Part Of CMS Pilot Program

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The Centers for Medicare & Medicaid Services (CMS) announced this week the start of a pilot program to enhance primary care via collaboration among CMS, private health insurance carriers and 500 primary care practices in seven regions across the US. 73 of those practices are in Colorado, with 335 participating physicians, and several of the top health insurance carriers in Colorado are participating too: Anthem Blue Cross Blue Shield, Cigna, Humana, Rocky Mountain Health Plans, and United Healthcare, in addition to Colorado Medicaid, Colorado Choice Health Plans, and Colorado Access (a health plan specifically designed for underserved populations).

CMS will be paying participating providers a “care management fee” which is estimated to be about $20 per month per beneficiary, in addition to the usual fee-for-service reimbursements. The private health insurance carriers that are participating have worked out their own reimbursement schedules, but one would assume that the setup will be similar to the one that CMS has devised. […]

Walgreens, Anthem Blue Cross Express Scripts Agreement Reached

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Express Scripts and Walgreens have come to a multi-year agreement for Walgreens to participate as an in-network retail pharmacy. Anthem Blue Cross Blue Shield of Colorado members will be able to use their prescription drug benefits at Walgreens locations beginning Sept. 15, 2012.

Walgreens was in a situation where it needed to get this deal figured out. They were losing millions, not just in prescription drug sales, but the people who weren’t in the store filling their prescriptions also weren’t in the store to buy juice, toilet paper, grills, etc…

Healthcare Costs Expected To Increase By 7.5% Next Year

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[…] Average out-of-pocket exposure on health insurance policies has been steadily increasing over the last several years (in the individual and small group market as well as the large group market).  Choosing a policy with a higher deductible and/or copays is the easiest way to mitigate premium increases, and it’s a popular option among employers and individuals who purchase their own health insurance.  Ten years ago, Jay and I had a health insurance policy with a $1000 deductible per person.  Now we have a $3500 deductible per person, plus an additional $3500 in coinsurance on an Anthem Blue Cross Blue Shield Core Share policy.  If we had stuck with a $1000 deductible all these years, our health insurance premium would be far higher than it is today.

The study Jason references notes that high deductible health insurance policies accounted for 4% of the market in 2006.  Over the next five years, that share increased to 17% by 2011.  My guess is that it will continue to increase as long as healthcare costs keep climbing at the rate that they have over the past decade.  If cost controls succeed at bringing healthcare cost increases more in line with other consumer price increases (projected to be 2% next year) over the next few years, I imagine that the popularity of high deductible health insurance policies will wane a bit.  There will always be people who are drawn to the tax advantages of HSA-qualified health plans, but a lot of individuals and employers who opt for higher deductibles are doing so in order to make their premiums more manageable.  As long as we continue to have healthcare costs that are climbing at a rate that far outpaces inflation and overall consumer price increases, we will likely see high deductible health insurance plans accounting for an ever-increasing segment of the market.

In addition to a shift towards higher deductible health insurance, large groups also have an increasing focus on wellness programs, which might make their employees less likely than the overall population to need healthcare.  This is another possible explanation for why health insurance premiums in the large group market are expected to climb an average of only 5.5% next year, even with an overall 7.5% increase in healthcare costs.

A Shared-Risk Success Story

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[…] In addition to beating their target financially, the program has also resulted in happier patients, increased market share for Blue Shield, fewer patient readmissions (likely due to the comprehensive patient discharge program that they created, and better chronic care management), a significant decrease in the number of inpatient days per thousand members, and far lower start-up administration costs than are typically projected for ACOs (although they note that they worked with existing programs and already-established relationships, so they weren’t building an ACO from scratch. But I imagine that would likely be the case with most ACO creation?). […]

Anthem Introduces New Accident And Critical Illness Benefits In Colorado

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[…] For individuals and families who are healthy and rarely need their health insurance benefits, an accident may be their primary concern. Obviously we’re all susceptible to illness aswell, but accidents have a more “out of the blue” quality to them, and can happen to even the healthiest of people. We’ve never needed our health insurance due to illness, but we’ve had a few injuries over the years that have been pretty costly. Stitches and x-rays on our son’s finger alone came to $1,400. The charges can add up quickly when you’re in an emergency room, and if you have a high deductible health insurance policy, you’d be responsible for the entire bill for an incident like that. An accident supplement that will cover all or a portion of the deductible can help people feel more at ease with a high deductible (ie, less expensive) health insurance policy.

The accident supplement portion of Balance will coordinate with your health insurance, so it will pay you either your out-of-pocket amount or the Balance benefit maximum, which ever is lower. For example, if your out-of-pocket expenses for an accident – after health insurance has paid its portion – come to $1750 and you have the $2500 benefit Balance plan, you’ll get $1750 in supplemental coverage. But if your out-of-pocket expenses come to $4500, you’ll get the full $2500. The critical illness benefit is a lump-sum payment, but the amount paid depends on the specific diagnosis.

With the introduction of Balance, Anthem Blue Cross Blue Shield has added another solid plan to the options available for individuals and families in Colorado who are looking for an accident and critical illness supplement to go along with their health insurance policy.

Best Health Insurance Companies In Colorado

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We recently got a call from a client who mentioned that he had done a Google search for the “best health insurance companies in Colorado” and his concern was that Anthem Blue Cross Blue Shield was not on the top ten list that he said came up as the first search result.  We were a… Read more about Best Health Insurance Companies In Colorado

Details From Anthem On Preventive Care And Contraceptive Coverage

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Last week we added a post about contraceptive coverage under the PPACA and what changes people could expect to see starting in August. We just received an information sheet regarding this subject from Anthem Blue Cross Blue Shield, and wanted to share it with our readers. It will be useful for our Anthem clients, and is also helpful to give people a rough idea of how the contraceptive coverage will be implemented by most carriers. There may be some small variations from one carrier to another, but in most cases things will be similar across the board, since federal legislation is guiding the changes.

The Anthem preventive care info sheet is relevant in Colorado and nine other states where Anthem operates Blue Cross Blue Shield plans, and applies to individual health insurance as well as small and large group plans.

The Anthem info sheet specifically notes that sterilization procedures for men are not included in the new contraceptive coverage – which is the conclusion I came to last week after quite a bit of reading on the subject – since all of the guidelines apply to adding contraceptive coverage to preventive care for women rather than preventive care in general. […]

Would Premiums Without A Mandate Really Only Be 2.4% Higher Than With A Mandate?

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[…] Keep in mind that all of those prices are based on the fact that the individual policies are medically underwritten (which means that the rates can be increased during underwriting or the application can be denied based on medical history), while the group plans are guaranteed issue and the rates cannot vary based on the group’s health status. There’s a huge range of options available, both in the individual and small group markets. But the premiums in the small group market for our family of four (parents in their 30s with two young children) would be roughly double what they are in the individual market.

Although I realize that the RAND study is important and useful, I wonder why the real-life scenario of individual versus small group premiums is so different. And although the ACA does put a cap on how much greater premiums can be for older people versus younger people, it doesn’t stipulate what the base premiums have to be for the younger people. Premiums have to follow the MLR rules (with insurers spending at least 80 – 85% of premiums on medical expenses), but they will reflect claims expenses pretty closely. […]

Anthem Blue Cross Blue Shield’s New Medical Home Program In Colorado

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[…] I can obviously see how this structure can result in lower costs, and I particularly like the fact that it will be paying primary care doctors for “non-visit” services that are not currently reimbursed (the example given in the press release is “preparing care plans for patients with multiple and complex conditions” but I can see how this could be extended to other areas of care and could help to move away from the current ten minute visit + diagnosis + prescription scenario that is so common). But particular care will need to be taken to make sure that the end result is truly healthier patients, as well as lower healthcare costs.

A measure of patient satisfaction could also be beneficial here. This is a tough one though, as patients might tend to have less of a focus on the overall picture (outcome + cost) and more focus on the factors that directly and immediately impact them, such as outcome and convenience. Cost is a factor for patients, but since most of us have health insurance, we tend to be largely insulated from the immediate costs of our healthcare. We get the annual rate increase notification or a letter from our employer saying that our deductible and copays are going up, but most patients probably don’t consider how their own healthcare usage directly impacts the overall “big picture” of healthcare spending (and thus the resulting health insurance premium hikes). But in general, a program that results in an overall improvement in patient health and lower costs should also end up with satisfied patients. Things like more face-time with their primary care doctor (who is being compensated for keeping the patient healthy, not just fixing problems once they occur) ought to improve patients’ overall perception of the care they are receiving. […]

The Elusive Nature Of Healthcare Costs

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[…] I’m still a fan of consumer directed health plans, high deductibles, and HSAs. I think that they can be useful tools to help people keep their health insurance premiums as low as possible and also (if an HSA is involved) set aside pre-tax money to cover potential future medical bills. But they are not a panacea. They are probably not a good solution for anyone who has a chronic illness that needs ongoing, expensive care. They don’t work so well for people with very little money who would struggle to cover the relatively high out-of-pocket costs and would not likely be able to fund an HSA. And no matter how great the actual consumer directed health plans are, the fact remains that transparency with regards to healthcare costs is still quite elusive. For some procedures, it can be relatively easy to get a set figure up front in terms of how much it’s going to cost. But much of the time that number can be difficult or impossible to pin down. Obviously, complications can arise in any medical situation (and the resulting increase in costs would make earlier estimates irrelevant). But even without factoring in complications, “shopping around” for healthcare is often an exercise in futility. In order to make consumer directed health plans more effective, there is much work to be done with regards to cost transparency.

Colorado Child-Only Open Enrollment Details For January 2012

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The next open enrollment for child-only policies is almost here, so I thought it might be helpful to provide some specific details in terms of what policies are available and what parents should expect when submitting child-only applications next month.

The first open enrollment window in 2012 will be the month of January. Applications for child-only policies have to be submitted between January 1 and January 31. Application not submitted by the end of January will have to wait and re-submit in July, which is the second open-enrollment period of the year. For most carriers, each child in a family will have to have a separate application.

All eligible child-only applications submitted during the open enrollment period are guaranteed issue, so the child cannot be refused coverage. However, the applications are still medically underwritten and the rate can be increased by up to 200% based on the child’s medical history (so if the standard price is $100, the policy could actually be assigned a rate of $300, which is equal to a 200% rate increase).

Colorado Senate Bill 128 requires all Colorado health insurance carriers that offer coverage for adults to also offer child-only plans during the two annual open enrollment windows. But the bill does not require carriers to provide guaranteed issue coverage for children who are eligible for health insurance from another source (other than a high risk pool like CoverColorado or GettingUSCovered – see the bottom of page 4).

Most Colorado carriers have selected one or two plan designs that will be available for child-only applications next month. To give you an idea of what is available in Colorado for child-only coverage, we’re providing information here regarding child-only options from six of the top individual health insurance carriers in the state. […]

CoverColorado Assessment For 2012

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[…] As the cost of healthcare continues to rise, CoverColorado – just like every other insurer – needs more and more money to cover the cost of claims. Their website shows the fees that have been assessed over the past few years, and the increased fee that will go into effect next month for 2012.

Because the CoverColorado assessment is collected by health insurance carriers and passed on to CoverColorado, the fee is added to each policy’s premium every month. The end result is that we all pay a few dollars more per month than the actual cost of our policy. This can be confusing, especially if people are new to individual health insurance and haven’t had experience with paying their own health insurance premiums in the past. The amount that is going to be drafted from your bank account or billed to you will be a few dollars higher than your stated premiums because it includes the CoverColorado assessment. […]

More Flexibility With An Individual Health Insurance Plan

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[…] For the average person who has had an individual policy for a decade and is late 50s-ish, keeping that individual policy (even though a group plan may become available) might be the ticket to being able to have some flexibility in terms of when to retire. The group plan is guaranteed issue – health conditions won’t be a barrier to getting coverage. But the group plan is also tied to the current employer, and the policy will only be available for a maximum of 18 months after you leave that job (via COBRA). […] Linda’s article is an excellent reminder about the importance of looking at the specifics of your own situation – including long term issues that might outweigh short-term benefits – rather than following conventional wisdom or doing what everyone else is doing.

Walgreens Leaving Express Scripts Network

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If you’re insured through Anthem Blue Cross Blue Shield or another carrier using the Express Scripts network, Walgreens will be leaving the network on January 1, 2012. Express Scripts just posted on their website:
“At Express Scripts, we’re committed to keeping your prescription drugs affordable and accessible. That’s why we negotiate cost-competitive agreements […]”
Express Scripts is sorry that Walgreens did what they did and has expressed sincere regret about the situation:
“We regret any inconvenience that Walgreens’ actions have caused you. If you have any questions, please call us at 1.877.885.3409.”

Health Insurance Exchange Payroll and Admin Expenses

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[…] One of the comments on the post was from Dede de Percin, the Executive Director of the Colorado Consumer Health Initiative (CCHI). […] Dede’s comment on my article referenced the point I made about consumers not having to pay additional fees to have a broker. Basically, health insurance is priced the same whether you go directly through a health insurance carrier (calling Anthem Blue Cross Blue Shield directly, for example) or through a broker (who will compare options from multiple carriers for you). Dede made this point:
“While a consumer or business doesn’t not pay a health insurance broker directly, broker fees and commissions are paid by the insurance companies – and rolled into […]”

Stuck In A Mini-Med

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[…] So he applied for an individual policy with Anthem Blue Cross for his family, and was approved. But then when he tried to cancel his mini-med plan, his employer told him that he couldn’t cancel it until the open enrollment period next April. It would seem that trapping enrollees into a year-long contract with a mini-med plan is not in line with the spirit of the HHS guidelines that call for full disclosure regarding the waivers and directives to steer enrollees towards healthcare dot gov if they are interested in getting a policy that does comply with the ACA rules regarding annual policy limits. […]

Decline And Rate Up Statistics – Interesting But Confusing

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[…] Your policy will cost the same amount regardless of whether you use a broker, but an experienced broker will be able to help you make sense of the plan comparison information, including the underwriting statistics. A policy or carrier’s statistical likelihood of declining or rating up any one application isn’t really relevant to each specific client… what is relevant however, is each carrier’s underwriting guidelines for the particular pre-existing condition the applicant has. […]

Colorado DOI Improving Transparency Of Rate Review Process

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[…] This should help boost public participation in the rate review discussion, and add to the general understanding of how the rate review process works. The DOI is obviously working hard to create as much transparency as possible with regards to rate increases. Rates will continue to increase as long as the cost of health care continues to climb (and as long as we continue to increase our utilization of health care) but at least the logic behind the rate increases will be more clear.