Carter's Benefits

eNewsletter Volume 5, Issue 03 March 2012

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Ready for Change?

Get ready for the new Summary of Benefits and Coverage Form.

Who Provides?
Carriers will provide this Summary of Benefits and Coverage form (SBC) to employers.
Employers will be required to provide this SBC to employees at certain times:

Uniform Format
4 Pages, double sided, at least 12 point font
Linguistically and technologically appropriate
May be provided with the SPD if prominently displayed
Best effort standards to describe unique plan terms.

Required Content
Set template
Uniform glossary of terms
Coverage facts label: birth, type II diabetes
Notice of modification (60 days prior to change)

Recent News

  1. New Regulations Require Easy-To-Understand Summaries Of Health Coverage.
  2. CMS Anti-Fraud Program To Begin In June.
  3. Texas Doctor Charged With Record Level Of Medicare Fraud.
  4. Texas Legislators Spar Over Healthcare Plan.
  5. Poll: Majority Of Voters Dislike Healthcare Reform Law.
  6. Federal Grant Will Create Consumer-Driven Health Insurance Plans In 2014.
  7. Fewer Americans Receive Health Insurance From Employer.
  8. High Court Could Prolong Healthcare Challenges For Years.
  9. AEI's Kleinke Says Healthcare Costs No Longer Surging.
  10. UnitedHealth To Base Physician Payments On Quality Of Care.

New Regulations Require Easy-To-Understand Summaries Of Health Coverage.
The Obama Administration issued regulations Thursday "requiring health plans to describe what they cover in clear, standardized language that is understandable to consumers," the Los Angeles Times (2/10, Levey) reports. The regulations are part of the Administration's effort to "implement a much-anticipated consumer protection in the new healthcare law." Beginning in the fall, "insurers and employers that offer health coverage will have to provide a six-page form that summarizes basic plan information, such as deductibles and co-pays, as well as costs for using in-network and out-of-network medical services."

Bloomberg News (2/10, Armstrong) reports that "the form currently provides examples on how much it might cost a patient to get treated for Type 2 diabetes, as well as a normal delivery of a baby." However, "the final draft removed a section providing an example on how much it would cost a patient to be treated for breast cancer, bowing to arguments made by the lobby group America's Health Insurance Plans that the condition was too complex to be easily summarized."

The Wall Street Journal (2/10, Radnofsky, Subscription Publication) reports that the deadline for insurance companies to produce the documents and make them available to consumers is Sept. 23. The Journal also adds that while employers and insurance providers say the requirement may be expensive and could lead to confusion, it is popular with consumers. Given the pre-election deadline and the popularity of the provision, the Journal notes that Democratic candidates may tout it on the campaign trail.

CQ (2/10, Bunis, Subscription Publication) reports, "On a conference call with reporters Thursday, Steve Larsen, head of the Office of Consumer Information and Insurance Oversight, said that the new effective date would still be in time for most consumers to review the summaries before they had to make decisions about their health insurance for 2013 and that there would be enough time to get the materials ready."

In a story carried by more than 140 news sources, the AP (2/10, Alonso-Zaldivar) quotes Medicare chief Marilyn Tavenner, who said, "If an insurance plan offers substandard coverage in some area, they won't be able to hide it in dozens of pages of text." The piece notes that "one shortcoming is that the summaries won't include premiums" because "administration officials said they ran into logistical problems trying to do that," although "premiums should be easily available anyway, either from their employer or directly from a health plan."

Modern Healthcare (2/10, Subscription Publication) reports, "the disclosure requirements, mandated by the Patient Protection and Affordable Care Act, aim to simplify consumer comparisons of various insurance plans, which have used marketing materials to sometimes obfuscate their details, according to HHS officials." Modern Healthcare also points out that during "a call with reporters," Tavenner said, "Markets work best when people have the information they need to make informed decisions."

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CMS Anti-Fraud Program To Begin In June.
Modern Healthcare (2/4, Daly, Subscription Publication) reported, "Two CMS anti-fraud programs, whose Jan. 1 launch was scrubbed because of provider concerns, will start in June instead, according to the agency." The piece adds, "A pilot program to require prior authorization for scooters and power wheelchairs prescribed for Medicare beneficiaries was supposed to launch Jan. 1, but the CMS announced shortly before the scheduled start date that it was temporarily suspending the program." CMS "agency announced that a 'significantly' redesigned version of the program will launch in seven states-including several with the largest Medicare populations and highest rates of erroneous billing-on June

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Texas Doctor Charged With Record Level Of Medicare Fraud.
The arrest of a Texas doctor for an unprecedented degree of healthcare fraud is being covered by nearly all major US daily newspapers in addition to a Tuesday mention on the CBS Evening News (2/28, story 8, 0:30, Pelley), which reported on the "breathtaking indictment in Texas," where "federal authorities are accusing a single doctor and six other people of stealing $375 million from Medicaid and Medicare. They allege they did it in only five and a half years. Prosecutors accuse Jacques Roy and the others of submitting claims for 11,000 patients who didn't need treatment."

The AP Share to FacebookShare to Twitter (2/29) says Roy sought "to bill Medicare for home health services that were not properly billed, not medically necessary or not done." The wrongdoing allegedly took place up until November of last year and represents the "largest dollar amount" ever uncovered in such a scheme by a task force of the Health and Human Services Department, which was created to combat Medicare fraud.

According to the New York Times Share to FacebookShare to Twitter (2/29, A18, Thomas, Subscription Publication), prosecutors said the scheme was "brazen" in that it "involved registering homeless people for home health care services they never received." A federal indictment referred to the operation as "staggering in its breadth and scope." Roy "ran an association of health care providers that certified patients for home health care and performed home visits. Even though he had only four doctors and about 15 nurses on his staff," the 11,000 patients he claimed to service would make his practice the largest in the US, which clearly wasn't accurate.

The Wall Street Journal Share to FacebookShare to Twitter (2/29, Zimmerman, Radnofsky, Subscription Publication) says a joint investigation by the HHS, FBI, and the Medicaid Fraud Control Unit of the Texas Attorney General had been underway for a year. In addition to the fake Medicare claims, there was also $24 million of fraudulent Medicaid claims. If convicted, Roy faces up to 100 years in prison and forfeiture of $18.5 million.

The Los Angeles Times Share to FacebookShare to Twitter (2/29, Serrano) says Roy's arrest "comes at a time when healthcare fraud is sharply increasing, with fewer people able to afford doctor visits and Medicare and other government programs paying less in reimbursements." In coincidental timing, Attorney General Eric Holder testified at a House Appropriations subcommittee hearing on Tuesday that efforts to thwart healthcare fraud were being ramped up. Holder noted the recovery of $4.1 billion in "stolen" funds last year was "the highest amount ever recovered in a single year."

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Texas Legislators Spar Over Healthcare Plan.
The Dallas (TX) Morning News Share to FacebookShare to Twitter (2/28, Garrett) reports, "Republican lawmakers on Monday belittled the federal health care overhaul's vaunted goal of near-universal coverage, while their Democratic colleagues questioned if Texas may be missing out on potential advantages by posturing against the law." Rep. Larry Taylor (R) "seized on written testimony from the state Health and Human Services Commission to imply that the law's costs will not justify the gains in coverage it brings." Rep. Elliott Naishtat (D) "questioned why the Texas Department of Insurance spent only $96,100 of a $1 million federal grant for planning the state health insurance exchange."

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Poll: Majority Of Voters Dislike Healthcare Reform Law.
The Los Angeles Times Share to FacebookShare to Twitter (2/28, Geiger) reports on a USA Today/Gallup poll Share to FacebookShare to Twitter, taken earlier this month and released Monday, which found that "nearly two years after President Obama signed his landmark healthcare package into law, three-quarters of registered voters believe the law's requirement that every American carry health insurance is unconstitutional." The survey showed that "a majority of voters...agreed in their dislike of the Affordable Care Act," which is "disappointing news for President Obama, whose reelection campaign counts enactment of the healthcare law as a signature achievement of his administration."

Politico Share to FacebookShare to Twitter (2/28, Mak) reports, "Gallup found that 47 percent of Americans want a GOP president to repeal the law, while 44 percent oppose that. ... Along party lines, a majority of Democrats - 56 percent - believe the health care mandate is unconstitutional and 37 percent defend it as constitutional. Among Republicans, 94 percent view that part of the law as unconstitutional." The Washington Examiner Share to FacebookShare to Twitter (2/28, Bedard) and The Hill Share to FacebookShare to Twitter (2/28, Sink) "Blog Briefing Room" blog also report this story.

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Federal Grant Will Create Consumer-Driven Health Insurance Plans In 2014.
McClatchy Share to FacebookShare to Twitter (2/22, Meyer) reports, "Seven organizations will receive a total of $639 million in federal low-interest loans to launch new, consumer-governed health insurance plans in eight states, the federal government announced Tuesday. The new plans, authorized by the 2010 health care law, are scheduled to open for business in 2014." The plans "primarily will serve Americans under age 65 in the individual and small-group insurance markets."

The AP Share to FacebookShare to Twitter (2/22) says the plans "will be designed to offer coverage to individuals and small businesses. Supporters say the co-ops will keep pressure on private insurance companies for both price and coverage. Critics, led by House Republicans who voted last year to repeal the health care law, immediately questioned the administration's decision. The House Ways and Means Committee called the loans a political reward to a friendly constituency."

The Hill Share to FacebookShare to Twitter (2/22, Pecquet) "Healthwatch" blog quotes the CMS' Marilyn Tavenner, who said, "We are excited to support the health insurance CO-Ops," which "will promote competition in the insurance market and respond well to the health care needs of Americans." Kaiser Health News Share to FacebookShare to Twitter (2/22, Meyer) and Modern Healthcare Share to FacebookShare to Twitter (2/22, Subscription Publication) also report on the loans.

Bloomberg News Share to FacebookShare to Twitter (2/22, Wayne) reports that "the Freelancers Union, a nonprofit created to represent freelance workers and independent contractors, will receive $341 million in loans from the US government to start health insurance plans in three states." Bloomberg adds that the health plans "will compete with for-profit offerings from companies including UnitedHealth Group Inc. and WellPoint Inc. and nonprofit Blue Cross plans beginning in 2014."

The Billings (MT) Gazette Share to FacebookShare to Twitter (2/22, Dennison) reports, "The fledgling Montana Health Cooperative on Tuesday became one of the first co-ops in the nation to win a federal loan, which will provide $58 million toward setting up the new, member-owned health insurer for Montana individuals and businesses. ... The US Health and Human Services Department gave the Montana co-op a $6.7 million start-up loan to pay for administrative costs of setting up the co-op and another $51 million loan to pay operating costs, such as claims payment." On its website, KRTV-TV Share to FacebookShare to Twitter Great Falls, MT (2/22) also reports on Montana's loan.

KCCI-TV Share to FacebookShare to Twitter Des Moines, IA (2/22) reports on its website, "The federal government has approved the first health care co-op for Iowa that will be set up as part of the new healthcare reform law. Midwest Members Health will offer affordable health insurance options to Iowans who have no access to health insurance through their employer."

New Mexico Business Weekly Share to FacebookShare to Twitter (2/22, Domrzalski, Subscription Publication) that New Mexico Health Connections "has received a $6 million loan from the federal government to start a consumer-oriented health plan from scratch that will cater to individuals and small employers."

The Oregonian Share to FacebookShare to Twitter (2/22, Rojas-Burke) reports, "Oregon's first consumer-operated health plan will receive more than $59 million in start-up and solvency loans from the federal government." The Eugene (OR) Register-Guard Share to FacebookShare to Twitter (2/22, McDonald) also reports on Oregon's loan.

The Omaha World-Herald Share to FacebookShare to Twitter (2/22, Jordon) reports, "Midwest Members Health, a new health insurance cooperative for Iowa and Nebraska, will receive a $112 million federal loan to pay startup costs and provide initial financial backing under the federal Patient Protection and Affordable Care Act." The coop is being organized by "David Lyons, former Iowa insurance commissioner and CEO of the Iowa Institute in Des Moines; Cliff Gold, a former senior executive with Blue Cross Blue Shield in Iowa and CEO of Cliff's Edge Strategies; and Stephen Ringlee of Ames, Iowa, a venture capitalist."

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Fewer Americans Receive Health Insurance From Employer.
MedPage Today Share to FacebookShare to Twitter (2/17, Walker) reports, "The percentage of Americans who received health insurance from an employer dropped in 2011, according to a Gallup poll Share to FacebookShare to Twitter." According to the data, approximately "45% of Americans had insurance through their employer in 2011, compared with 49% in 2008, when the decline began." The poll noted that the decline is "partly because of people losing their jobs, but that's not the only cause," adding that "Americans who were still working in 2011 -- in both full- and part-time jobs -- were less likely to get insurance from their employer."

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High Court Could Prolong Healthcare Challenges For Years.
USA Today Share to FacebookShare to Twitter (2/21, Biskupic) reports that "there is a path the Supreme Court could take when it hears" the challenge to the healthcare reform law next month "that could delay for years any resolution of a main point of contention." USA notes that the "core of the law is a requirement that most people buy health insurance by 2014 or face a tax penalty," a requirement that could be affected by "a federal policy that restricts the timing of lawsuits connected to the assessment and collection of 'any tax.'" When the court takes up challenges to the law on March 26-28, the justices "will consider that policy and address whether people who challenge the insurance requirement must first pay the disputed tax and seek a refund before bringing a lawsuit." If they rule affirmatively, the legal challenges could be delayed, perhaps until 2015.

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AEI's Kleinke Says Healthcare Costs No Longer Surging.
In a Wall Street Journal Share to FacebookShare to Twitter (2/17, Subscription Publication) op-ed, J.D. Kleinke of the American Enterprise Institute writes that, contrary to the popular view, US healthcare spending has been moving closer to the general inflation rate over the past decade after constantly rising since the 1970s. This normalization is due to improvements in care, changes in the insurance sector, and by the demands of a competitive marketplace. Kleinke also says care as a whole is improving, citing the widespread availability of once-pricey cancer, HIV, and mental illness drugs.

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UnitedHealth To Base Physician Payments On Quality Of Care.
Bloomberg News (2/10, Frier, Armstrong) reports, "UnitedHealth Group Inc. (UNH), the largest US health insurer by sales, will pay doctors based on the quality of their care in a cost-cutting effort that also benefits the company's consulting business." The insurer "expects to save twice as much as it would spend on incentive payments for doctors because patients will be healthier, according to company documents forwarded by spokeswoman Cheryl Randolph." This "program may cover as much as 70 percent of the insurer's commercial members by 2015, from less than 2 percent now, the company said."

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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

Carter's Benefits
Your Benefit Consultant Team

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