Insurance Makes Me Crazy

What to Expect for 2016 Open Enrollment Plans

Fri, 24 Jul 2015 14:23:00 GMT

News Alert – July 23, 2015

Individual/Consumer Markets

What to Expect for 2016 Open Enrollment Plans

On Monday, the Texas Department of Insurance gave Blue Cross and Blue Shield of Texas (BCBSTX) the clearance to announce a change in retail product offerings for 2016. We wanted to share this information with you first.

The retail market has evolved significantly since the opening of the Health Insurance Marketplace in 2014. These changes require BCBSTX to make adjustments that will allow us to continue offering sustainable health insurance options.

There are some changes in the plans we intend to offer in 2016. Most significantly, we won’t be offering our Blue Choice PPO insurance plans for our under 65 block of business going forward.

We intend to offer other products, on and off the Marketplace. A new product has been filed that we believe will give you a flexible choice for your clients. We will be able to share information about that product if and when it is approved by the Centers for Medicare & Medicaid Services (CMS) closer to open enrollment.

We are committed to offering competitively priced individual insurance options in every county in the state, both on and off the Marketplace.

During the months leading up to the beginning of open enrollment, we will talk publicly about the plan transition, and make information available to members and key stakeholders. Below are some details you can use when reaching out to your PPO customers. We recommend that you start having these conversations soon since our proactive outreach could lead to media attention.

We stand ready to assist you and your clients through this transition.

Details for You

Currently, we have about 367,000 individual Texas members who will have their PPO plan discontinued in 2016. This number fluctuates monthly.

Around 148,000 Texas members are in grandfathered PPO plans that will not be discontinued. Our Blue Choice PPO network will continue to serve these members.

This change does not affect our product offerings for our employer group customers or Medicare members.

Our Blue Advantage® HMO network will remain. We are working to expand the numbers and reach of providers participating in that network.

We only had the first full year of ACA claims data for analysis this year, for 2014 claims. In the individual market segment in 2014, BCBSTX paid out more than $400 million more in claims than it collected in premiums. Losses that high are unsustainable, and we have adjusted our offerings – as many insurers have – to be sustainable in the new market reality.

Not all hospital systems or large physician networks will be participating in our network options for individual members. While this was true in previous years, the number of providers not in network due to the discontinuance may be greater in 2016. We have ensured that we have an adequate network to provide the physicians and hospitals needed to serve our retail members in each market, and we continue to have discussions with additional providers.

Talking Points for Discussing the Changes with Your Clients

Why is BCBSTX discontinuing the Blue Choice PPO?
For the past two years, BCBSTX has been the only health insurer offering an individual PPO plan in all Texas markets. BCBSTX found that the PPO is not sustainable at an affordable price due to anti-selection. BCBSTX will continue to offer other plan options in all 254 counties, on and off the Marketplace.

What will this mean for individual members who currently have the PPO plan?
BCBSTX will be transitioning affected individual members to another plan, so you will not experience a gap in coverage. You will also have the option of choosing a different plan during 2016 open enrollment.

Are there providers who were available under the PPO who will no longer be in network for BCBSTX members on any plan?
There are some providers who were in BCBSTX’s individual PPO plans networks who will no longer be an in-network option for individual members, except those in grandfathered plans. These providers declined to participate in the Blue Advantage network.

If you are seeing a provider who will no longer be available to you through the new plan’s network, BCBSTX will work with you to find a new provider. If you are currently undergoing a course of treatment, BCBSTX will work with you and your providers to minimize the impact to your care, just as if you changed plans for any other reason.

BCBSTX continually seeks opportunities to work with providers to offer the best solutions for our members.

Will there be a rate increase for HMO for 2016?
BCBSTX’s rate filings are currently under review by CMS, so that information won’t be available until rates are finalized and approved. BCBSTX pricing is designed to allow the insurer to offer sustainable products and services to its customers for years to come. A medical loss ratio (MLR) requirement is in place to protect consumers by requiring a high percentage of premiums to go to medical costs. If that requirement is not met, customers may be eligible for a premium rebate.

What would have been the rate increase for PPO for 2016 if it was still available?
A plan’s success requires the right ratios of enrollees to providers, and of the amount of premiums paid in to amounts paid out for care provided. In the 2014 individual business, BCBSTX paid out millions more in claims than it collected in premiums. Losses that high are not sustainable. Like any business, BCBSTX must make necessary adjustments. There were no options that kept the PPO sustainable and still allowed for other plans to be offered across the state.

Why couldn’t you just continue offering the PPO and increase the rate for it?
Under ACA, individual business is rated using a single risk pool, meaning all individual plans had to be looked at together. This means BCBSTX couldn’t just look at the pricing of the PPO separately. If BCBSTX had kept both the PPO and HMO, it would have added dramatic costs for every member with an individual plan.

Is group subsidizing individual business?
The group line of business operates separately from the individual line of business. BCBSTX’s group rates are based on expected cost of doing business for 2016 for group business.

What can I do now?
This announcement does not affect your coverage through the end of the year. There is no need to do anything right now.

Shopping for 2016 plans is expected to open Oct. 10, when insurers are allowed to publicly release the full range of plan offerings for the coming year. You will receive a formal notice from BCBSTX by Oct. 1 that will give you the details of your plan changes.

We encourage you to learn more about how an HMO works. BCBSTX has information about HMOs in the “insurance basics” section of their website at bcbstx.com.

If you have more questions now, you can call BCBSTX at the toll-free Customer Service number listed on the back of your ID card.

Ten Things You Need to Know about the PPACA Ruling-Part Two

Mon, 22 Oct 2012 05:00:00 GMT

The majority opinion written by Chief Justice John Roberts further states that just because a type of inactivity is taxed does not make it illegal. Although the goal of the mandate to purchase insurance is to increase the number of U.S. citizens who have healthcare insurance, failure to purchase the insurance is not illegal. There are no stated or implied adverse legal consequences to not having health insurance. The only requirement if an individual does not buy it, that person must pay a fee to the Internal Revenue Service. If a person decides to pay the tax rather than buy insurance, the requirements of the Act have been met and the person has followed the law.

Roberts said that it is expected that some 4 million people annually would choose to not buy insurance and pay the fee to the IRS. Congress did not expect that those 4 million people would be treated as outlaws.

Roberts further wrote that Congress can give the states money under the Affordable Care Act to increase the availability of healthcare, but it cannot change the laws regarding the use of any Medicare funds. However, those states that accept the money would have to comply with pre-set conditions on how to use the funds. Congress may not take back Medicare money if certain states choose to not participate in the Act.

Restrictions placed on the PPACA Medicaid provisions did not kill the entire Act because the court believes that unless Congress obviously worded the Act so that if one part was killed that the entire law would die with it. How many states will accept the PPACA’s Medicaid funding expansion is unknown, but the court did not think that Congress wanted the whole Act to fail because some states refuse to participate. The rest of the reforms will remain “fully operative as a law” and will still work in a manner consistent with the basic goals Congress had when it enacted the law.

The Supreme Court did not express an opinion as to whether the PPACA was a wise Act. The Supreme Court is meant to enforce the federal government’s limits set forth by the nation’s founding fathers. However, the Supreme Court is not supposed to opine on the wisdom of any particular Act based on the Constitution. That is the privilege of the citizens of the United States.

The dissenting opinion says the PPACA is an example of “vast judicial overreaching.” The dissenters further stated that the statute’s requirement to buy insurance or face a penalty is really a voluntary option that is subject to taxation. As they see it, the Act changes the coercive penalty of a total cut-off of Medicaid funding to an allegedly non-coercive removal of only the extra funds made available by the Act. The Act also forces states and the public to spend large amounts of money on requisites that might not survive any revisions by Congress.

On a lighter note, the majority, concurring and dissenting Supreme Court Justices refer to broccoli 12 times in their opinions.

Ten Things You Need to Know about the PPACA Ruling

Wed, 10 Oct 2012 18:27:00 GMT

The United States Supreme Court ruled on the Patient Protection and Affordable Care Act (PPACA) on June 28, 2012. Most of the provisions of the PPACA were upheld. The Act was signed into law on March 23, 2010. You’ve probably heard it referred to as the federal healthcare law or Obamacare. It is the most significant revamping of the U.S. healthcare system since Medicare and Medicaid were passed in 1965. The focus of PPACA is to lower the number of Americans who don’t carry health insurance.

PPACA will reduce Medicare spending and future deficits, according to the Congressional Budget Office. There are tax credits, mandates and subsidies that are meant to provide healthcare to those who cannot afford it. It also requires insurance providers to accept all applicants and give them the same rates with pre-existing conditions or gender having no bearing on the price.

When deciding on NFIB VS. Sebelius, Chief Justice John Roberts wrote the majority opinion in which the court ruled the Anti-Injunction Act, which restricts lawsuits over taxes, doesn’t prohibit the Court from considering a major lawsuit that challenges the Act’s constitutionality. Roberts further wrote that the imposition of a mandate for individual health insurance does not violate the Commerce Clause or the Necessary and Proper Clause of the U.S. Constitution. He also wrote that the individual mandate is a tax, not a mandate, which is permitted by the Taxing Clause of the Constitution. The Constitution authorizes Congress to “lay and collect taxes” against people who do not purchase certain commercial products. However, it cannot force people to purchase products.

The Supreme Court regards the “shared responsibility payment” as a tax. Roberts wrote that considerable revenue could be raised via the payment, but the main purpose is to increase the number of people with healthcare coverage. He also said that taxes to influence the conduct of the public have been around since the United States became united. The early growth of America’s domestic industry was aided by federal taxes. Taxes on retail sales of cigarettes are meant to motivate people to quit smoking. There are also taxes meant to dissuade individuals from selling sawed-off shotguns and marijuana.

Should you buy health insurance to cover normal, inexpensive medical expenses?

Fri, 20 Apr 2012 05:00:00 GMT

Given the cost of health insurance, it seems foolish to purchase a policy if you can afford to pay for these costs on your own. If you look at the price of standard insurance policies in your neck of the woods, you’ll see that you’d be wasting your money. It’s almost a certainty that a policy with no deductible or a low deductible is not a smart plan.

There are two manners of insuring yourself for medical costs. You can buy a third-party insurance policy, or you can self-insure. You can hedge your bets by getting an insurance policy that has a higher deductible and setting up a savings account meant to cover your routine medical expenses yourself. How high you set your deductible and how much you save depends on the market price for your insurance.

Consider these figures from UnitedHealthcare. They’re based on the premium a family of four living in Dallas would pay for health insurance coverage. In the first case, each visit to the doctor would require a $35 copay. With a $1,000 deductible per person (or $2,000 per family), the yearly premium would be $17,400, or $1,450 per month. Raising the deductible provides some relief. If the deductible is changed to $2,500 per family member, the family is vulnerable to an extra $1,500 financial risk, up to a $3,000 per family maximum. The higher deductible will save nearly $5,000 per year with lower premiums. If the deductible is raised higher, the savings are even greater. While the family does assume an extra $4,000 in risk per family member (or $8,000) for the family), $8,000 would be saved on yearly premiums.

With an across the board deductible plan, a low deductible of $1,500 would require a $1,067 monthly premium. Raising the deductible to $2,500 would result in yearly savings of $3,528. Increasing the deductible to $5,000 would realize $4,344 in annual premium savings.

The numbers are convincing. It would make no sense to buy a health insurance plan with a $1,000 or $1,500 deductible. Since Dallas is a high-cost city, the savings realized from a higher deductible would be larger in another area. Those with group insurance would receive less in savings.

It seems that large insurers receive greater price discounts than uninsured people who pay for their own healthcare. However, those uninsured individuals are not taking advantage of market opportunities for better bargains. By paying cash for your healthcare, you can get services for roughly 50 percent of the price paid by Blue Cross, especially if you’re willing to drive a little further for service. Those people with high deductible policies usually pay the going rate that was negotiated by the insurer, regardless of who pays the bill.

Few Employers Plan to Drop Employee Healthcare Coverage

Fri, 06 Apr 2012 05:00:00 GMT

Are you ready for a little good news on U.S. jobs and employers? With the abysmal economic climate, any good news is to be treasured. According to a new survey by GfK Custom Research North America, most American employers report that they will continue to provide employer-sponsored health insurance once the Patient Protection and Affordable Care Act (PPACA) kicks in during 2014. Of those employers surveyed, 56 percent said they will still donate to their employees’ healthcare plans. Another 12 percent of those who make such decisions said they were probably going to drop the coverage completely. Of the 502 private-sector companies included in the survey, 32 percent are unsure what they will do when the time comes. A mere 4 percent of surveyed employers said they would definitely drop coverage completely. Those companies were large corporations.

It seems that those corporate decision-makers who are the most familiar with the upcoming healthcare reform are not as likely to drop coverage as their counterparts. Only 7 percent of those with a good understanding of the changes said they could envision dropping coverage for their employees. Fifteen percent of the executives who were less familiar with the legislation said they would likely discontinue their employer-sponsored coverage. While most companies share a commitment to continuing their plans, many of them are fearful that the PPACA rules will not slow the increasing costs of healthcare and could actually make the rising cost trend worsen.

Only 11 percent of the respondents think the cost of healthcare benefits will increase more slowly than if the reforms did not go into effect in 2014. A total of 51 percent believe their expenses will increase more quickly. A large percentage of those surveyed are unsure of the effect the PPACA will have on their expenses.

Preventing Healthcare Identity Theft

Fri, 23 Mar 2012 05:00:00 GMT

Healthcare identity theft is a rapidly growing problem. Unscrupulous scoundrels not only steal personal financial information, they can also use the identity of unsuspecting individuals to see a doctor, order fraudulent prescriptions or file claims through the victim’s health insurance plan. Proactive prevention is the best way to guard against identity theft. Here are a few things everyone needs to know to protect their identity and safeguard their personal healthcare information.

1. Request a copy of all medical records held by your doctor’s office and health insurance providers. By law, insurers and healthcare organizations are required to share these documents within 30 days after a request is received. It’s imperative to contact all providers individually. Organizations from which to request documents include doctors, clinics, labs, pharmacies, hospitals and insurers. Providers that are unable or unwilling to grant access to personal medical records must grant the individual a written explanation. In the event that a request is denied, patients should contact a patient representative, ombudsman or the individual listed in the organization’s Notice of Privacy Practices to appeal the decision.

2. Secure a copy of account disclosures from providers and insurers. This information can help patients pinpoint informational issues and locate providers that have erroneous information. Healthcare laws give patients the ability to request a copy of a provider’s accounting information free of charge once in ever 12 month period.

3. Reviewing annual credit reports is one way to detect financial or healthcare identity theft. National laws require the three major credit bureaus and credit reporting agencies to provide individuals with a free copy of their credit report each year, if they are so requested. Patients can also visit annualcreditreport.com or call 1-877-322-8228. Individuals can also mail in their request by completing the Annual Credit Report Request form, which can be downloaded at FTC.gov/freereports. This form should be sent to:

Annual Credit Report Request Service

P.O. Box 105281

Atlanta, GA 30348-5281

4. Last, but not least, patients should carefully read all Explanation of Benefits statements or EOB paperwork. Healthcare plans send this information to policy holders following treatment. Information included in the EOB statement should detail all paid claims for medical care that the policy holder received. The EOB statement should detail the provider’s name, the date of service and the services that were provided. If there’s a discrepancy, the policy provider should be contacted to report the problem as soon as possible.

For more information about HIPAA patient rights, contact the Department of Health and Human Services through the Office for Civil Rights. Their website can be found at HHS.gov/ocr.

Cobra Facts for Employers

Fri, 09 Mar 2012 06:00:00 GMT

COBRA (Consolidated Omnibus Budget Reconciliation Act of 1986) gives some former employees, retirees, spouses, previous spouses and dependent children the option to have continuing health care coverage at group rates. It is only applicable when the coverage was lost for certain reasons. While the coverage continues, the group rates may increase because the employer no longer pays a portion of the premium for the ex-employee. COBRA participants must pay the entire fee on their own.

Here are some facts regarding COBRA you’ll need to know if you’re an employer.

As the Employer, you have the ultimate responsibility for COBRA compliance. Audits by the DOL or IRS are at your office.

You must comply with COBRA if you have more than 20 full time employees. Not all of your employees have to be on benefits.

Part time employees count as a percentage toward the 20. If you consider a 40 hour employee to be eligible for benefits, then a part time employee who works 20 hours per week would be considered as one half of an employee toward the 20 full-time employees. When an Insurance Broker looks at the Employee Commission Quarterly report, you must alert the Broker to the total full time and part time employee count.

Brokers should be aware of employer ownership. If your company is owned by a larger company, your smaller company must be COBRA compliant even if you have less than 20 employees.

All COBRA participants and any pending participants have the same rights as your active employees. If an active employee can change or add benefits, add or remove dependents, the COBRA participant has the same rights. Plan changes require that the COBRA participant or pending participant be provided new rates, an application and plan summaries. A rate change does not deny the COBRA eligible individual to make plan changes and add or drop dependents.

If you employ 50 or more employees, you must comply with FMLA. Your employees may take FMLA leave in one lump sum or a few days at a time. If an employee ends his or her eligibility for FMLA and is not returning to work, that person becomes COBRA eligible. You must provide the ex-employee with COBRA election information.

Recently, an employer with a self insured health plan used STD (Short Term Disability) after FMLA. They did not send out the COBRA Election letter nor did they notify the Self Insured administrator. When claims were refused by the claims administrator, the courts ruled the employer was responsible for the ex-employees claims. The claims administrator did not consider STD to be employment. The employer had not looked at the agreement with the Self Insured Administrator. The employer lost over $400,000.

Federal Judges tend to get very angry regarding USERRA compliance. (Uniformed Services Employment and Reemployment Rights Act “USERRA"). USERRA provides that an employee returning from military duty must be given his old job back or one commensurate with his previous job in pay and skill requirements.

In Fryer v. A.S.A.P. Fire and Safety Corporation, a recent Federal case, the employer lost over $700,000. The employee returned from IRAQ and was told that his position had been filled and no position was available. After the DOL got involved, the employee was offered a lower level job and was terminated shortly thereafter. The DOL took the employer to Federal Court.

Federal Courts are the last resort in COBRA problems. Unless you are well trained in COBRA regulations, no advice regarding COBRA should be given to an employee or ex-employee. What HR tells an ex-employee can be brought up in a court case. A referral to a qualified COBRA administrator is very important. If the information from HR is incorrect, the employer loses.

COBRA Facts for Employees

Fri, 24 Feb 2012 06:00:00 GMT

COBRA gives some former employees, retirees, spouses, previous spouses and dependent children the option to have continuing health care coverage at group rates. It is only applicable when the coverage was lost for certain reasons. While the coverage continues, the group rates may increase because the employer no longer pays a portion of the premium for the ex-employee. COBRA participants must pay the entire fee on their own.

Here are some facts regarding COBRA you’ll need to know if you’re an ex-employee.

In Texas, your benefits end on the last day of the month for fully insured plans. Coverage expires on the first day of the following month. If you have a self-insured plan, your benefits may end either at the end of the month or the last date you were employed.

COBRA may last for a period of 18, 29 or 36 months, depending on the manner of your separation. Coverage will expire if you don’t pay the premium, become eligible for Medicare or acquire other health coverage.

Correspondence regarding COBRA is mailed to your last known address. The address will be determined during your exit interview. Your W-2 forms will also be mailed to that address.

If you were terminated for “Gross Misconduct,” your employer does not have to contact you regarding COBRA election information. Your dependents will not be eligible for COBRA either. Although the IRS has not established a legal definition for “Gross Misconduct”. Federal Courts make the decision on a case by case basis.

Termination for “Cause,” is not necessarily “Gross Misconduct.” Your employer will require legal advice in that case. Your employer must fully document any termination for “Gross Misconduct.”

Republicans Rejoice

Fri, 16 Dec 2011 06:00:00 GMT

Republicans Rejoice

President Obama abandons the long-term health insurance portion of Obamacare.

The GOP has won its first battle in their war to overturn the Obama administration’s overhaul of the nation’s health insurance. Since its inception, the long-term health insurance plan has been criticized for lacking financial solvency. The plan is scheduled to be implemented in 2012. Included in the legislation were nursing homes and features like home health aides for the disabled. Republicans hailed Obama’s decision as a victory for current and future taxpayers. They claim the long-term plan shouldn’t be implemented because it is unsustainable.

The late Sen. Edward M. Kennedy, D-Mass., spearheaded the original program, known as CLASS, Community Living Assistance Services and Supports program. After Kennedy’s death, Obamacare realized Kennedy’s long held dream of universal health insurance. The CLASS portion, however, will likely not survive, even though some believe the program can still be implemented.

The original intention was for the program to operate as a voluntary, self-perpetuating insurance plan for working adults, despite their health or age. By paying into the fund monthly, the worker accrued a nest egg that could provide as much as $50 in cash per day should the participant become disabled at some point in their life. The individual could choose to spend the money on nursing home fees or for other home health services.

From its inception, CLASS was hounded by one main problem. A large percentage of working adults would need to contribute to the fund prior to their retirement. Otherwise, the requirements of the disabled beneficiaries would destabilize the fund due to the rapidly increasing premiums. That could precipitate a taxpayer bailout of the fund down the road.

Despite spending months defending the program, President Obama has finally relented, admitting the plan had no easy fix. Prior to being implemented, the law requires 75 years of financial solvency. However, officials now believe CLASS cannot be both financially solvent and affordable if it is voluntary and open to every working adult.

Bob Clark

Clark Insurance Advisors
214-534-8929

Changes on the Horizon for Mental Health Coverage

Fri, 02 Dec 2011 06:00:00 GMT

Changes on the Horizon for Mental Health Coverage

If you ever tried to use your health insurance for mental health issues, you probably discovered you were out of luck. Most policies refuse to pay for the services of a psychiatrist, psychologist, counselor or nutritionist. But a new development out of California could alter the landscape for those suffering from mental health issues like depression, drug addiction, eating disorders, schizophrenia or alcoholism. Insurers now have to adhere to California’s Mental Health Parity Act that demands insurers cover both physical and mental health problems.

The ultimate decision came from a lawsuit over whether an insurance company could refuse treatment for a woman who suffered from anorexia. This patient required intravenous feeding tubes during a ten-month in-patient stay. The patient was 36 percent below her ideal body weight. Her battle with body dysmorphic disorder made her believe she looked fatter than she was. Her attempts to look thin led to acute weight loss that came from a psychological disorder, not a physical one.

While some policies offer behavioral health treatment, they usually have limitations that make the coverage practically worthless. Some have an unrealistic limit on the number of visits you can make to a psychiatrist in one calendar year. Some have a limit on the amount they’ll pay for in-patient drug rehabilitation.

If you need extra behavioral health coverage, look into a supplemental plan for behavioral health. You can purchase plans for teens, children and adults. Secondary policies add the robust coverage needed to fully treat mental health problems like anxiety, panic disorders, obsessive-compulsive disorder, severe depression, speech therapy and eating disorders.

It’s possible to structure a personalized plan for you or your family, depending on your needs. We can add extra coverage to your existing policy or add a supplemental policy that will include any sort of therapy, rehabilitation, medication or devices.

With mental illness touching 25 percent of the population, it makes sense to prepare for any eventuality. Make sure your health insurance will actually insure you if you need help dealing with a mental illness. If your policy is inadequate, add some supplemental behavioral health insurance.

What Does Your Health Insurance Cover?

Fri, 18 Nov 2011 15:17:00 GMT

You might be surprised by what’s included and not included in your health insurance. Every provider and each plan they sell contains varying exclusions and limitations. In most cases, a health insurance policy will allow preventive attention and emergency care. Unless you’re certain what your plan covers, you may end up owing money after receiving care.

For example, do you know what qualifies as an emergency to your insurance provider? Almost every company has their own definition for the term. A broken leg or arm would seem like an emergency, but unless it is life-threatening, some policies won’t cover a trip to the emergency room for a broken appendage.

Some plans take into account the day of the week that you check in to the hospital. Weekend stays are discouraged, except for absolute emergencies. Items that are not covered with routine treatment might include the use of an outside phone line, medications like cough suppressant, extra bed linens or pillows and even bandages or dressings.

If you’re into death-defying sports like skydiving or rock climbing, a normal health insurance policy isn’t the best option for you. You’ll want to get a special policy that covers extreme sports. If you get injured due to your own negligence, your policy might not pay your medical bills. For example, if you’re the cause of a vehicular accident and you’re convicted of drunken driving, your policy may not cover your injuries. Physical therapy might be covered after an accident, but it could come with limitations on what doctor you can see and how often you can seek treatment.

Treatments for mental health issues like drug addiction, psychoanalysis and alcoholism might be covered. They also might not be covered. If they are, they may have a very low limit, so before you sign up for a year of twice-weekly visits to a psychiatrist, check your policy and confirm your limits. Bills for an attempted suicide are usually not covered, since the injuries you suffered were self-inflicted.

When you switch providers or begin a new policy, you’ll usually face a waiting period before pre-existing conditions will be covered. That period could last 6 months or an entire year. If you have a pre-existing condition, make sure you find a policy that doesn’t have a lengthy waiting period.

To cover yourself against any shortcomings in your health insurance plan, you might want to buy some supplemental coverage. Just about anybody can benefit from supplemental insurance. It can fill in the gaps in your health coverage. Supplemental insurance can cover anything from advanced specialized testing, lab fees and mental health examinations. Physical therapy, nutritional guidance and even smoking cessation programs are covered by most supplemental plans.

If you’re not sure what your plan covers, call us. We’ll go over your policy and see what it covers and doesn’t cover. We can also set up a supplemental plan if you have special needs.

Bob Clark

Clark Insurance Advisors
214-534-8929

Beware of Out-of-Pocket Costs for Medicare

Fri, 04 Nov 2011 05:00:00 GMT

After finally making it to retirement age, you’re probably excited to know that as a new Medicare member, you’re finally guaranteed health insurance coverage for the rest of your life. Of course, that could change if there are any major alterations to Medicare, like the much-discussed plan to assign Medicare vouchers to folks under the age of 55.

The core components of Medicare are universal for almost all members of the program. That includes Part A hospital coverage, Part B outpatient coverage and the optional Part D prescription drug coverage. From there, coverage can vary considerably. For example, some 22 percent of Medicare members choose managed care plans like HMOs and PPOs that vary depending on the insurance company and the plan.

There can be so many unseen fees that some Medicare members buy their own supplemental insurance to completely cover themselves from the ever-increasing out-of-pocket expenses. In 1998, for example, Medicare recipients spent an average of 11.8 percent of their income for their Medicare payments. That figure leaped to 16.2 by 2006, according to the Center for Medicare Advocacy. On the average, women pay even more—up to 19 percent. If you have a chronic malady like Alzheimer’s disease or cancer, you could end up spending 22 percent of your income for Medicare. An average beneficiary had out-of-pocket expenses totaling $4,241, reported the Kaiser Family Foundation. That figure could increase or decrease depending on overall health and age.

If you see a charge on your bill that you don’t understand, ask about it. Sometimes folks on Medicare just pay their bills without reading them. If you’re faced with a charge that Medicare won’t cover, many imaging centers, outpatient surgery centers, labs, hospitals and doctors’ office have special self-pay rates. Plus, you can always try to negotiate a better price from the provider. Offering to pay up front or with cash sometimes can net a better deal.

So although Medicare coverage is guaranteed, it isn’t free. The charges you rack up on Medicare might surprise you. Retirees on a fixed income may be in for an unpleasant surprise. Younger folks should factor Medicare expenses into their retirement planning. Forewarned is forearmed, however, so here is a list of expenses you might have to pay even though you’re proudly carrying your Medicare card.

There is a premium for Medicare. Assuming you worked hard and paid your dues to Medicare, Part A coverage is free. However, Part B of original Medicare has costs related to income. Currently, for someone earning under $85,000, the premium is around $115.

You will have a yearly deductible. For items, prescriptions and services covered under Part B, there’s a yearly $162 deductible that must be paid before Medicare coverage kicks in.

There’s usually a copay or coinsurance that you’re responsible for with Medicare. For example, outpatient mental health services require 45 percent copay.

The Part D prescription drug “donut hole“ is known for gobbling up excess cash. The Medicare prescription plan covers your expenses up to a certain point. It then subsides until your bills reach another plateau. The costs you incur in the interim period are not covered.

Many doctors are opting out of Medicare coverage. When making an appointment for a referral or to see a new physician, make sure they accept your particular Medicare plan.

You doctor might not “accept assignment.” That means they want their full pay and aren’t going to accept the standard Medicare fee for their services. That means you get stuck paying the difference. Once again, be sure to check ahead of time and ask specific questions to find out how much you’ll be expected to contribute to the treatment or service. It can turn into an accounting nightmare if you don’t do your homework ahead of time.

Should you require some time in a skilled nursing facility because you’re not sick enough to be in a hospital but too sick to be at home, check into the skilled nursing facility three-day hospitalization rule. To qualify for the services of a skilled nursing facility, you must first spend three days in the hospital if you want Medicare to pay for your nursing home visit.

If you’re on the Medicare Advantage plan, make sure your doctor is in the network. Otherwise you might have to pay a copay or the entire fee. Check the list for a near-by replacement physician if your doctor isn’t on the list.

Medicare doesn’t cover everything, including routine dental care, cosmetic surgery, acupuncture, hearing aids and exams for hearing aids. A Medigap plan or Medicare Advantage program might cover these types of services.

Medicare isn’t a bottomless well. You can exhaust your maximum benefits with one extended hospital stay. Medicare will cover 90 days in one calendar year. After that, you are eligible for 60 days of lifetime reserve. Without Medicare Advantage, that’s the limit from Medicare. Medicare Advantage usually has no lifetime maximum benefit.

Should Children Remain on their Parent's Health Insurance Policies After College?

Fri, 21 Oct 2011 05:00:00 GMT

Despite last year’s popular provision of the health care reform law permitting children under the age of 26 to remain on their parents’ health care plan, many young adults and college graduates may find that this option is no longer available to them or is not their best choice for health coverage.

Children may not qualify to stay on their parents’ policy if:

The parents decide to drop their child from their policy.
The child takes a job with health insurance and the parents are covered under a plan that was grandfathered under old law. The policy isn’t required to cover dependents who have access to their own health insurance

The child takes a job with health insurance that costs less than remaining on the parents’ policy costs.

The parents must pay 100 percent of the cost for their dependent’s coverage, making individual insurance from the child’s job more affordable.
The child moves to a city where the parents’ policy is not applicable.

In the event that a child is leaving town or beginning new employment, it’s critical to determine if the parents’ policy will still provide coverage or if another policy is a better option for the dependent. If the child is moving, the parent should start by calling the insurance company and checking where coverage is included.

Out-of-network coverage for an HMO (health maintenance organization) will probably be very slight. Some HMOs offer 90 days’ worth of coverage if they offer coverage in the state to which the child moves, but they will require the parents to obtain individual care for the child after that period. If the HMO has no facilities within the new state, the only coverage offered would be for emergency services.

Normal health care would need to be performed at the parents’ city. A PPO (preferred provider organization) offers more choices and the flexibility of a broader network.

If the parent has insurance that was grandfathered, the carrier does not have to abide by the provision requiring them to provide care until the child turns 26. Even though the Affordable Care Act requires the carrier to cover dependants whether they are single, married or a dependant on their parents’ income tax, once the dependant takes a job that offers health insurance, the parents’ company does not have to cover the child--even if the child doesn’t enroll in the coverage offered by their job. After 2014, a grandfathered plan will have to cover adult children who have access to coverage through their employment. Likewise, if the plan is not grandfathered, the adult child can remain on the policy even if they can get coverage elsewhere.

It’s easy to compare the options. Check the premiums for individual coverage and dependant coverage. Examine the co-payments, benefits and prescription coverage. A healthy young person might be able to find inexpensive insurance with a high deductible. Usually, inclusion on the parents’ plan is the best option.

A recent survey indicates parents don’t expect to keep their children on their health care plan until they’re 26. Students surveyed felt that their parents should provide one year of coverage past graduation.

Children Need a Medical Home

Fri, 07 Oct 2011 05:00:00 GMT

A new study by the University of Michigan Medical School found that children who have public insurance are 22 percent less likely to get comprehensive care than their counterparts who have private insurance.

A large portion of the estimated one-third of U.S. children on public insurance programs are minorities, the poor and children who are already in poor health. That would include those covered by CHIP (Children's Health Insurance Program) and Medicaid.

The study ascertained how many children on public programs said they had a medical home. The American Academy of Pediatrics (AAP) encourages a medical home as a model for pediatric primary care. The heavily-promoted approach is meant to simplify cooperation between parents, their children and health care providers. The AAP says a medical home provides excellent pediatric primary care and is "accessible, continuous, comprehensive, family centered, coordinated, compassionate, and culturally effective."

The data was collected from the National Center for Health Statistics’ 2007 National Survey of Children's Health phone survey. Parents were asked questions regarding the usual source of medical care for their children, how hard it was to get referrals, whether they had a personal doctor, availability of family-based care and how well care providers communicated among themselves. From the pool of people on public insurance sampled, 45 percent of the children met all five conditions. That’s 22 percent less that the number of children who had private insurance.

One encouraging sign was that 90 percent of those children who had public insurance said they had a regular doctor and source of health care. Usually, this group had difficulty finding and maintaining primary care. Many parents with children on public care felt their doctors didn’t spend enough time with their children, failed to listen
carefully, were insensitive to their family’s customs and value system and didn’t give needed data to the family.

The study cites a need to provide more access to primary care for publicly-insured children and to monitor the quality of the care they receive. This research was the first of its type that compared such a wide variety of children. It provided a country-wide benchmark for establishing medical homes for both private and publicly-insured children.

Study Shows Latinos Spend Less on Health Care Than White Population

Fri, 23 Sep 2011 05:00:00 GMT

UCLA has just completed a study that found the white population spends more than Latinos on health care insurance. This is especially true of Latinos who were not born in the United States. Latinos are more likely to pay their medical bills themselves when they require medical services.

The data that was examined included 31,500 Latino adults and 76,000 non-Latino whites. It was gathered by the Medical Expenditure Panel Survey (MEPS) based on health expenditures, socioeconomic status, current health and health insurance status. That data was cross-referenced against individual citizenship and immigration status data from the National Health Interview Survey (NHIS) from the United States National Center for Health Statistics.

The study centered on the difference between the amounts spent on health care by Latinos based on the length of time they had been in the U.S. and the status of their citizenship or nationality. The data discloses that the longer naturalized Latinos live in the U.S., the more likely they are to get health insurance. However, researchers say the difference between spending by non-citizen Latinos and those who were naturalized remains wide.

It was found that both native-born and foreign-born Latinos were 68 percent more likely to not have any health insurance whatsoever, when compared to whites. They were six percent more likely to pay their medical costs themselves than whites. Plus, Latinos spent 57 percent less than the white population on health expenditures.

The lower spending could be attributed to non-citizens’ limited exposure to public health plans, a reliance on returning to their native country for treatment and being unfamiliar with the U.S. healthcare system.

Fortunately, the spread between native and foreign-born Latinos subsides sharply after about ten years, which is likely due to the assimilation of the Latino population and intergenerational improvement of their economic status.