Carter's Benefits

eNewsletter Volume 3, Issue 11 November 2010

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The Results Are In ...

The elections are over and the results are in. Did your candidate(s) win? Whether you are left, right, in the middle, independent or TEA, the only way to effect change is to vote. We are seeing an upswing in voter turn out and that is good. Continue to be active in the political system and vote your conscious.

Minimum Loss Ratio Coming Soon

NAIC has made their recommendation to the Department of Health and Human Services on a key part of health care reform, the "Minimum Loss Ratio Requirement"or MLR for short. You may recall the Affordable Care Act or ACA, requires insurance companies to spend at least 85 cents out of every premium dollar on medical claims for its large group policy holders, and 80 cents on its small group and individual policy holders. The remaining 15-20 cents can be used to pay operating expenses like advertising, payroll, overhead and profits.

Recent News

  1. NAIC Sends Final MLR Recommendations To Sebelius
  2. CMS Project May Cast Doubt On Cost Reduction Hopes Under Health Reform
  3. Study Says More Healthcare Providers Adopting EHR System
  4. Several Claims About Healthcare Law Examined, Discounted
  5. Healthcare Law Requirements Expected To Impact Selections For New Health Plans
  6. Poll Shows Americans Still Evenly Split On Healthcare Law
  7. Judge Says Florida Challenge Of Healthcare Law To Proceed
  8. Insurers Will Be Allowed To Charge Higher Premiums For Sick Children
NAIC Sends Final MLR Recommendations To Sebelius.

CQ HealthBeat (10/29, Norman, subscription required) reports, "The National Association of Insurance Commissioners on Wednesday formally sent to the Department of Health and Human Services its recommendations on a key rule establishing minimum medical payouts." These "recommendations, arrived at by commissioners last week following months of intense negotiations and debate, rejected pleas by insurance companies for greater flexibility in implementing new national medical loss ratio (MLR) rules." Notably, the "commissioners asked that Health and Human Services Secretary Kathleen Sebelius 'give deference to the analysis and recommendations of state regulators' in markets that might be destabilized. They also repeated their promise to form a working group to examine the role of insurance agents under the new rules."

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CMS Project May Cast Doubt On Cost Reduction Hopes Under Health Reform.

Merrill Goozner writes in a Kaiser Health News /The Fiscal Times (10/29) piece, "Over the past decade, Medicare ran a pay-for-performance, shared savings demonstration project with ten group physician practices on the cutting edge of raising health care quality in the US. It was a major test of two of the cardinal tenets of health care reform: that raising quality lowers costs, and that group practices offer the best vehicle for weaning physicians from fee-for-service medicine." But, CMS found that while all the practices improved quality over a three-year period, "only five groups generated any savings," leading some experts to caution that "Medicare's experience with the physician group practice demonstration project raises a warning flag over reformers' high hopes for the dozens of demonstration projects aimed at lowering costs that were authorized in the Affordable Care Act."

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Study Says More Healthcare Providers Adopting EHR System.

The National Journal (10/28, Gruenwald, subscription required) reported, "A new study released Thursday found that up to 50 percent of healthcare providers have either adopted electronic health records or are partially using them." CompTIA researchers found that "34 percent of healthcare providers now use a 'comprehensive'" EHR system "and 16 percent said they are using a partial system." The study "surveyed 370 US information technology firms, about 40 percent of which do business in the healthcare sector, and 300 US healthcare providers."

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Several Claims About Healthcare Law Examined, Discounted.

The Washington Post (10/19, Aizenman, Appleby) reports, "The debate that preceded passage of the health-care overhaul has returned as a heated issue in the midterm elections," and "politicians and advocacy groups seeking repeal of the law are making dramatic claims about its cost and effects." The piece goes on to evaluate the validity of several of these claims, and notes for instance, that "the Republican assertion that...workers will be forced to 'drop their current coverage' implies the workers will be left with a worse plan or none at all," yet "there's little evidence for that." In addition, the "gutting-of-Medicare claim goes too far," because the "new law slows the growth of Medicare spending over the next decade," but "it doesn't actually cut spending from one year to the next."

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Healthcare Law Requirements Expected To Impact Selections For New Health Plans.

Walecia Konrad wrote in the New York Times (10/16, B6) Patient Money column, "This is the time of year when your employer allows you to make changes to your benefits package -- most importantly, to your health insurance." Just "as in years past, employers will be rejiggering their plans with an eye toward passing much of this year's increase in health insurance costs to employees," with "health insurance premiums...expected to rise an average of 8.8 percent," and "employees' out-of-pocket expenses...expected to increase 12.5 percent from 2010." Yet, "the biggest changes arrive this year courtesy of the new health care law," which requires "employers to extend health insurance coverage to uninsured dependents up to age 26, eliminate any lifetime caps on coverage, and pay 100 percent of the cost of annual physicals and some other preventive care."

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Poll Shows Americans Still Evenly Split On Healthcare Law.

The Washington Post (10/16, Dropp) reported the latest Washington Post-ABC News poll shows "an electorate still about evenly split on the healthcare law: 46% of voters for it, 50% against. Moreover, more than three-quarters of those who oppose the changes say they support an effort to cancel the healthcare reform measures. ... Support for the bill, though, dips lower among those who are most likely to turn out in November, with opposition rising to 55 percent of likely voters in the early October Post-ABC poll. As they were in March, older Americans are skeptical of the reforms. Four in 10 adults ages 50 and up support the changes, compared with more than half of younger Americans."

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Judge Says Florida Challenge Of Healthcare Law To Proceed.
Coverage of the main suit against the healthcare law was relegated mostly to newspapers, and only one network mentioned it briefly. While most sources hailed the decision as a preliminary victory for opponents of the law, they also cautioned that ultimately, this and other cases would likely be decided by the US Supreme Court. The CBS Evening News (10/14, story 2, 0:15 Couric) reported that "the battle over healthcare reform may be heading to court. Twenty states have joined forces to challenge the new law and today, a Federal judge ruled key parts of their lawsuit may, in fact, go to trial."
        Politico (10/15, Haberkorn) reports, "A federal judge in Florida on Thursday said he will allow some of the lawsuit challenging the constitutionality of the health care law to proceed -- and criticized Democrats for making an 'Alice in Wonderland' argument to defend the law." Notably, "US District Judge Roger Vinson allowed two major counts to proceed: the states' challenge to the controversial requirement that nearly all Americans buy insurance and a required expansion of the Medicaid program." In addition, "Vinson criticized Democrats," saying, "Congress should not be permitted to secure and cast politically difficult votes on controversial legislation by deliberately calling something one thing, after which the defenders of that legislation take an 'Alice-in-Wonderland' tack and argue in court that Congress really meant something else entirely, thereby circumventing the safeguard that exists to keep their broad power in check."

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Insurers Will Be Allowed To Charge Higher Premiums For Sick Children.
The New York Times (10/14, Pear) reports, "The Obama administration, aiming to encourage health insurance companies to offer child-only policies, said Wednesday that they could charge higher premiums for coverage of children with serious medical problems, if state law allowed it." Many "major insurers, faced with an unprofitable business," have "stopped issuing new child-only policies." Now, the administration said insurers "could charge higher premiums to sick children outside the open-enrollment period." In "a series of questions and answers intended to clarify its reading of the law, the administration said Wednesday that insurers had two options. They can enroll all children year-round, or decline to enroll all children outside the open-enrollment period."
        The Hill 's (10/14, Pecquet) "Healthwatch" blog reports, "Health and Human Services Secretary Kathleen Sebelius said Wednesday that health insurers can't make it harder to enroll sick children." But the insurers can "charge higher premiums for children with pre-existing conditions." Insurers "have come under intense pressure from Democrats and health reform advocates not to drop coverage, and they've had to come up with ways to prevent families from only buying insurance for their children when they become sick." HHS is "'very seriously considering' creating a national open enrollment period, said Office of Consumer Information and Insurance Oversight Director Jay Angoff."
        Kaiser Health News (10/14, Carey) reports, "While HHS had previously said that insurers and states could have a limited enrollment period," they offered additional guidance on Wednesday. HHS said, "Insurers can't have a window of enrollment for some children and not others." Parents "may still find other challenges, however, including the availability and cost of the coverage. Some states place no limits on how much could be charged for that coverage."
        The National Journal (10/14, McCarthy) reports Sebelius "laid out new stipulations for child-only health insurance policies, in response to recent instances of insurance companies across the country dropping such policies." CQ HealthBeat (10/14, subscription required), the Orlando Sentinel (10/14, Shrieves), the Myrtle Beach (SC) Sun News (10/14, Dudley), and Kansas Public Radio (10/14, Thompson) also report the story.

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How does Carter's Benefits help ?
We continue to stay on top of changes in this industry. In a consultative role, Eddie Carter has begun hosting live seminars to update employers and Human Resource Managers on these changes. If you would like to host a meeting with your local community or civic organization, please contact me for details.

Eddie Carter, Consultant Eddie Carter,
Benefit Consultant
If you have questions or would like more information please give us a call or send us an email.  Our email address is Questions@CartersBenefits.Com

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