The “grandfathered” rules have changed. Let the celebration begin! Ok, maybe not.
New information was released this week further detailing which companies can or can not remain grandfathered. This is an amendment to the interim final regulations that were issued on June 17, 2010 by the Department of Health and Human Services, the Department of Labor, and the Department of the Treasury.
This is the link to the thirty-five page summary.
This is the quick version of what changed: Businesses are now allowed to change insurance companies as long as nothing else substantially changes.
My posts of August 2nd and August 16th provided a quick list of requirements to retain your grandfathered status and how difficult that may prove to be. A key point of contention was that unions could change insurers, but small businesses and individuals could not, even if the insurance company left the market or made significant changes to its products. This amendment reverses that for businesses, but not for individuals. Heck, it’s a start.
The rules, this one, the set issued in June, and all future regulations, are subject to change or reversal. Long term planning is based purely on educated guesses.
The enforcement regulations and delineation of potential penalties will quickly follow.
My prediction: The forms, the cost to remain in compliance, and the penalties will all be far more expensive than simply opting out of private insurance for small business. Paying an annual “No Insurance” penalty (TAX) to the federal government will be cheaper and easier.
You are now up to date. This really is the blind leading the blind. No one really knows how this is going to play out. We are all guessing. Some of us may be better guessers than others, but no one really knows for sure. The recent election may have a real impact on the Patient Protection and Affordable Care Act or it may not change a thing. That can be said of every variable. All we can do, as business owners, as employees, as health care consumers, is to pay attention and hope for the best.
It is time to review the process.
March 23, 2010 – Congress passed and the President signed a far-reaching piece of legislation that affects 1/6 of our economy and the health and well-being of every American.
June 17, 2010 – The Departments of Health and Human Services, Labor, and the Treasury issued rules that apply to all business and individual health insurance policies, RETROACTIVELY from March 23, 2010. The rules also allowed for Public Comment.
June 17, 2010 – Some businesses and individuals learned that the changes they have made, or have been forced to make, preclude grandfathering from the new regulations. Businesses enact new plans accordingly.
November 16, 2010 – New rules. You might have been grandfathered after all, but now that you have made other changes, you aren’t!
Sometime in the next three to six months – Final rules will be issued.
Next Steps:
* Compliance
* Enforcement
* Penalties
Once the rules are final, how will the government and your insurance company know that you are complying? My guess will be FORMS. The Patient Protection and Affordable Care Act, with the onerous 1099 requirements, is a printer’s dream. Clients are already asking if there will be notarized affidavits required to certify their status. Not yet, but that could be coming soon.
Change can be useful. Change can be difficult. Ill-conceived, disorganized, rushed change is bound to cause unnecessary stress. Yes, this really is the blind leading the blind, but we appear to be going around in circles and there isn’t a whole lot any of us can do about it. Relax. Concentrate on your business. This isn’t war. Bullets aren’t flying. We will get through this. Together.
DAVE
www.bogartcunix.com
Thursday, November 18, 2010
Monday, November 15, 2010
National Greatness and David Brooks
Today’s Health Insurance Issues With Dave is being replaced by the latest New York Times column from David Brooks. The Title is National Greatness Agenda. It is, on the surface, more about politics than health care or health insurance. Dig deeper dear reader. If we are not more responsible, if we don’t get our government’s finances under control, none of these new government mandated and totally unfunded programs will survive.
As the health care debate reignites, it is time to once again demand transparency, accountability, and clear, definable goals.
We may all agree that we are a great nation, but are we willing to work towards National Greatness?
http://www.nytimes.com/2010/11/12/opinion/12brooks.html?ref=davidbrooks
DAVE
www.bogartcunix.com
As the health care debate reignites, it is time to once again demand transparency, accountability, and clear, definable goals.
We may all agree that we are a great nation, but are we willing to work towards National Greatness?
http://www.nytimes.com/2010/11/12/opinion/12brooks.html?ref=davidbrooks
DAVE
www.bogartcunix.com
Wednesday, November 3, 2010
OK. Now What?
Barry, my friend the CPA, is undoubtedly smiling. Barry formed a Tea Party of one, almost twenty years ago. His goal was to always have divided government. As long as the Democrats or Republicans were restrained, were kept from controlling both Houses of Congress and the Presidency, there would be some level of gridlock. Only the most important legislation could be passed. The moment either side had real power, all Hell broke loose. Last night was a good night for Barry and the many people who long for a smaller government.
This blog, however, is about health insurance and health care, not politics, so I will leave the list of winners and losers to others. Politics do play a huge role in how health care is delivered in this country and an even larger part in the foreseeable future. And health insurance, health care, and our system of entitlements had equally large roles in last night’s results. They are intertwined. The Republicans took the House last night. They almost captured the Senate. How will this impact health care?
The short answer may be “Not Too Much”.
President Obama came to office in the midst of a financial meltdown. He had three paths in front of him – a Crisis, a Disaster, and an Issue. He faced a divided country and had the chance to invest his political capital into only one. The Crisis was the economy and unemployment. The Disaster was Americans fighting and dying in two wars. The Issue was health care and specifically the uninsured and underinsured of our country. He chose the issue and spent the majority of his first two years and political good will pushing through an unpopular, poorly designed piece of legislation.
The Patient Protection and Affordable Care Act succeeded in energizing the opposition. Even centrist Democrats and Republicans were outraged by this combination of government overreach and intellectual dishonesty. Democrats representing swing districts, like John Boccieri, were pressured into supporting a bill that almost single-handedly caused their defeat.
Republicans have campaigned against the PPACA. Some have implied, some have even promised, to repeal this legislation. Can this legislation, passed only seven and a half months ago, be reversed? And, more importantly, do the Republicans want to?
NO and NO.
The Patient Protection and Affordable Care Act is not going to be repealed or reversed anytime soon. Oh, I’m sure Speaker-designate John Boehner will run a bill through the House. It will be great political theater. And, it will be risk free. The legislation won’t get through the Senate, and even if it did, it would be vetoed by the President.
I sincerely doubt that the Republicans would want to repeal this legislation. This is a fundraising bonanza. Campaigning against PPACA is far more profitable than solving the problems that necessitated the law.
So, we have a bad bill and the real possibility that cynicism may rule the day. Plus, we have yet to mention the insurers who have already spent millions to comply with the new rules and regulations. I firmly believe that the insurers have devised a path to real success under a government run health plan where they provide supplementary coverages. The major insurance companies would then have no desire to repeal the law.
We are quickly approaching the next calendar triggers of the health care legislation. It is possible that the Republican lead House of Representatives, far more interested in extending the Bush era tax cuts than anything else, might tackle meaningful reform in early spring. In a yet to be exhibited act of political maturity, the House could even draft a bill to limit and refine the PPACA. Such legislation could be passed by the Senate and signed by the President. It is possible. I leave the question of probability to you.
We had a major governmental change last night, a massive swing from the left to the right. What has changed in regards to the delivery of health care, the affordability of health insurance and the access to needed medical care? Alas, not much.
DAVE
www.bogartcunix.com
This blog, however, is about health insurance and health care, not politics, so I will leave the list of winners and losers to others. Politics do play a huge role in how health care is delivered in this country and an even larger part in the foreseeable future. And health insurance, health care, and our system of entitlements had equally large roles in last night’s results. They are intertwined. The Republicans took the House last night. They almost captured the Senate. How will this impact health care?
The short answer may be “Not Too Much”.
President Obama came to office in the midst of a financial meltdown. He had three paths in front of him – a Crisis, a Disaster, and an Issue. He faced a divided country and had the chance to invest his political capital into only one. The Crisis was the economy and unemployment. The Disaster was Americans fighting and dying in two wars. The Issue was health care and specifically the uninsured and underinsured of our country. He chose the issue and spent the majority of his first two years and political good will pushing through an unpopular, poorly designed piece of legislation.
The Patient Protection and Affordable Care Act succeeded in energizing the opposition. Even centrist Democrats and Republicans were outraged by this combination of government overreach and intellectual dishonesty. Democrats representing swing districts, like John Boccieri, were pressured into supporting a bill that almost single-handedly caused their defeat.
Republicans have campaigned against the PPACA. Some have implied, some have even promised, to repeal this legislation. Can this legislation, passed only seven and a half months ago, be reversed? And, more importantly, do the Republicans want to?
NO and NO.
The Patient Protection and Affordable Care Act is not going to be repealed or reversed anytime soon. Oh, I’m sure Speaker-designate John Boehner will run a bill through the House. It will be great political theater. And, it will be risk free. The legislation won’t get through the Senate, and even if it did, it would be vetoed by the President.
I sincerely doubt that the Republicans would want to repeal this legislation. This is a fundraising bonanza. Campaigning against PPACA is far more profitable than solving the problems that necessitated the law.
So, we have a bad bill and the real possibility that cynicism may rule the day. Plus, we have yet to mention the insurers who have already spent millions to comply with the new rules and regulations. I firmly believe that the insurers have devised a path to real success under a government run health plan where they provide supplementary coverages. The major insurance companies would then have no desire to repeal the law.
We are quickly approaching the next calendar triggers of the health care legislation. It is possible that the Republican lead House of Representatives, far more interested in extending the Bush era tax cuts than anything else, might tackle meaningful reform in early spring. In a yet to be exhibited act of political maturity, the House could even draft a bill to limit and refine the PPACA. Such legislation could be passed by the Senate and signed by the President. It is possible. I leave the question of probability to you.
We had a major governmental change last night, a massive swing from the left to the right. What has changed in regards to the delivery of health care, the affordability of health insurance and the access to needed medical care? Alas, not much.
DAVE
www.bogartcunix.com
Tuesday, October 19, 2010
How Much Will Free Cost You?
I looked at the Medical Mutual form again. Yes, I was a bit flustered by the beautiful woman with the deep dark eyes sitting there, next to me, in my office. But thirty-two years of experience kicked in and I continued to study the form. The numbers did not make sense. It took a call to the insurance company to solve the mystery.
I understood the answer immediately. Natasha’s health insurance policy renews November 1st. One premium, $510.96, is for her current “grandfathered” policy covering her and her college student son. The non-grandfathered version of the same policy is $547.75, a difference of $36.79 per month.
Welcome to the next phase of the implementation of the Patient Protection and Affordable Care Act. New provisions became effective on September 23rd. Like day following night, new prices became effective on September 24th.
In my post, Addicted to Other People’s Money, I wondered how much the new free basic preventive care services would cost us. We now have the initial price tag.
First, let’s detail what changed on September 23, 2010. The two key elements are Essential Benefits and Preventive Care. The definitions, below, come courtesy of Medical Mutual of Ohio. The email quoted in my July 20th post from Mrs. Obama bragged of even more comprehensive (expensive) benefits.
Essential Benefits: The law requires plans to remove lifetime limits on what the government defines as “essential” benefits. The law will also prohibit annual dollar limits, but not until 2014, which allows insurers to phase lifetime limits out by implementing annual dollar limits that will be incrementally increased each year until 2014. Essential benefits include: ambulatory patient services, emergency services, hospitalization, maternity and newborn care, mental health and substance use disorder services (including behavioral health treatment), prescription drugs, rehabilitative services and devices, laboratory services, preventive and wellness services, chronic disease management and pediatric services (including oral, vision and hearing examinations).
Preventive Health Services: Plans may not impose any cost-sharing requirements (e.g., copay, coinsurance or deductible) on preventive health services, as defined by the U.S. Preventive Services Task Force, when administered by a network provider.
Quick summary:
Essential Benefits become limitless.
Preventive Care Services become free.
Natasha (all names changed) and her son would be forced to pay $431 more over the next year for this. Another client, Paul, had a much more expensive experience. His new Anthem policy was effective September 20th. The premium for Paul, his wife, and two children for a high deductible contract is $402.55 per month. Since he had already paid his September and October premiums for his old policy, he wanted to re-date the new policy to November 1st. The premium for the exact same policy, enhanced with the new Free benefits, would be $480.77, an increase of $78.22. Are these new provisions worth almost $1,000? Not to Paul. And probably not to you.
So here we are, less than a year into the new law, and we are already seeing the impact of the new Patient Protection and Affordable Care Act. It is harder, not easier, to insure Americans. Insurance is more expensive, not less. And the words Cost Containment are still missing from the President’s vernacular.
The September 23rd changes are just becoming effective. More mandated changes are due for January 1st. And the rules are still being written, on the fly, as we reinvent the delivery of healthcare. I’m just hoping that nothing else is Free. We can’t afford free.
DAVE
www.bogartcunix.com
By the way, Jeff, my business partner, was concerned that this post was too dry and contained too much detail. I told him that I could trust my readers to not only plow through a fact laden piece, I could even count on some of you to add pithy, timely comments.
I understood the answer immediately. Natasha’s health insurance policy renews November 1st. One premium, $510.96, is for her current “grandfathered” policy covering her and her college student son. The non-grandfathered version of the same policy is $547.75, a difference of $36.79 per month.
Welcome to the next phase of the implementation of the Patient Protection and Affordable Care Act. New provisions became effective on September 23rd. Like day following night, new prices became effective on September 24th.
In my post, Addicted to Other People’s Money, I wondered how much the new free basic preventive care services would cost us. We now have the initial price tag.
First, let’s detail what changed on September 23, 2010. The two key elements are Essential Benefits and Preventive Care. The definitions, below, come courtesy of Medical Mutual of Ohio. The email quoted in my July 20th post from Mrs. Obama bragged of even more comprehensive (expensive) benefits.
Essential Benefits: The law requires plans to remove lifetime limits on what the government defines as “essential” benefits. The law will also prohibit annual dollar limits, but not until 2014, which allows insurers to phase lifetime limits out by implementing annual dollar limits that will be incrementally increased each year until 2014. Essential benefits include: ambulatory patient services, emergency services, hospitalization, maternity and newborn care, mental health and substance use disorder services (including behavioral health treatment), prescription drugs, rehabilitative services and devices, laboratory services, preventive and wellness services, chronic disease management and pediatric services (including oral, vision and hearing examinations).
Preventive Health Services: Plans may not impose any cost-sharing requirements (e.g., copay, coinsurance or deductible) on preventive health services, as defined by the U.S. Preventive Services Task Force, when administered by a network provider.
Quick summary:
Essential Benefits become limitless.
Preventive Care Services become free.
Natasha (all names changed) and her son would be forced to pay $431 more over the next year for this. Another client, Paul, had a much more expensive experience. His new Anthem policy was effective September 20th. The premium for Paul, his wife, and two children for a high deductible contract is $402.55 per month. Since he had already paid his September and October premiums for his old policy, he wanted to re-date the new policy to November 1st. The premium for the exact same policy, enhanced with the new Free benefits, would be $480.77, an increase of $78.22. Are these new provisions worth almost $1,000? Not to Paul. And probably not to you.
So here we are, less than a year into the new law, and we are already seeing the impact of the new Patient Protection and Affordable Care Act. It is harder, not easier, to insure Americans. Insurance is more expensive, not less. And the words Cost Containment are still missing from the President’s vernacular.
The September 23rd changes are just becoming effective. More mandated changes are due for January 1st. And the rules are still being written, on the fly, as we reinvent the delivery of healthcare. I’m just hoping that nothing else is Free. We can’t afford free.
DAVE
www.bogartcunix.com
By the way, Jeff, my business partner, was concerned that this post was too dry and contained too much detail. I told him that I could trust my readers to not only plow through a fact laden piece, I could even count on some of you to add pithy, timely comments.
Monday, October 4, 2010
We Have To Destroy This Village To Save It
Insurance is real. My job is to work with real people, everyday, to solve real problems. I get angry and frustrated when the theoretical and the hypothetical invade my space and get in my way. Yes, I have an agenda. All but the apathetic have an agenda. The undeclared and disorganized agenda of the national Democrats interfered with my work this week. And I am more than just a little upset.
Jimmy (yes, the name is changed) is a healthy eleven year old living in Greater Cleveland. I have no idea where his dad lives. Jimmy lives with his mother, Wendy, a woman who has not worked since her unfortunate skiing accident of a few years ago. Jimmy’s major bills, like school, are paid by a generous aunt. Jimmy is uninsured.
Wendy had insurance for her son and herself, but she let it lapse in August. She didn’t pay the insurance and she didn’t tell her sister until last Monday. Why are the dates important? Because now we have a problem.
Wendy’s sister would have kept the old policy active, had she been notified in a timely manner. Though Wendy has recovered, for the most part, from her serious injuries, she is difficult to insure at this time. Due to the new health bill, we can not write a Child, Only policy on Jimmy. We could two weeks ago. A comprehensive policy on a healthy eleven year old used to be around $100 a month. That policy no longer exists.
Proponents of the new health care legislation, the Patient Protection and Affordable Care Act, love to cite the new provisions for covering children. No underwriting. No limits on preexisting conditions. Totally free preventive care. How do you price that policy? How do you properly build reserves for the sudden, and massive, shift of risk as parents currently paying for underwritten policies move to blindly issued contracts? You can’t. The insurance companies eliminated all Child, Only policies.
How many unhealthy kids are there? How many of my clients, small businesses in Northeast Ohio, are paying higher premiums because the owner’s child has a heart condition or a genetic disorder or some other ailment that requires substantial care? LOTS. And if the insurers didn’t play self-defense, if the companies unthinkingly threw open the doors and took all of them at a standard rates, the results would be devastating.
So where does that leave Jimmy, our healthy eleven year old? I can write, for the moment, short term, catastrophic coverage on Wendy and Jimmy. G-d forbid insurance. It is the best I can do. Governor Strickland, realizing the mess Washington has created, signed an emergency order this week to force the insurance companies to have a special “open enrollment” for Child, Only policies. Medical Mutual of Ohio, Anthem Blue Cross, and UnitedHealth Care have yet to determine how to comply with this order or how to price the product.
We had a health care system. It was uniquely American and it served 80% to 85% of us. It was hardly perfect, but it was ours and, like it or not, it reflected our values and our tastes. We needed to improve the system we had to better serve all Americans. Instead, we are in the process of dismantling our method of paying for health care and interacting with our medical providers.
Jimmy is just, to use the proper term, collateral damage.
DAVE
www.bogartcunix.com
Jimmy (yes, the name is changed) is a healthy eleven year old living in Greater Cleveland. I have no idea where his dad lives. Jimmy lives with his mother, Wendy, a woman who has not worked since her unfortunate skiing accident of a few years ago. Jimmy’s major bills, like school, are paid by a generous aunt. Jimmy is uninsured.
Wendy had insurance for her son and herself, but she let it lapse in August. She didn’t pay the insurance and she didn’t tell her sister until last Monday. Why are the dates important? Because now we have a problem.
Wendy’s sister would have kept the old policy active, had she been notified in a timely manner. Though Wendy has recovered, for the most part, from her serious injuries, she is difficult to insure at this time. Due to the new health bill, we can not write a Child, Only policy on Jimmy. We could two weeks ago. A comprehensive policy on a healthy eleven year old used to be around $100 a month. That policy no longer exists.
Proponents of the new health care legislation, the Patient Protection and Affordable Care Act, love to cite the new provisions for covering children. No underwriting. No limits on preexisting conditions. Totally free preventive care. How do you price that policy? How do you properly build reserves for the sudden, and massive, shift of risk as parents currently paying for underwritten policies move to blindly issued contracts? You can’t. The insurance companies eliminated all Child, Only policies.
How many unhealthy kids are there? How many of my clients, small businesses in Northeast Ohio, are paying higher premiums because the owner’s child has a heart condition or a genetic disorder or some other ailment that requires substantial care? LOTS. And if the insurers didn’t play self-defense, if the companies unthinkingly threw open the doors and took all of them at a standard rates, the results would be devastating.
So where does that leave Jimmy, our healthy eleven year old? I can write, for the moment, short term, catastrophic coverage on Wendy and Jimmy. G-d forbid insurance. It is the best I can do. Governor Strickland, realizing the mess Washington has created, signed an emergency order this week to force the insurance companies to have a special “open enrollment” for Child, Only policies. Medical Mutual of Ohio, Anthem Blue Cross, and UnitedHealth Care have yet to determine how to comply with this order or how to price the product.
We had a health care system. It was uniquely American and it served 80% to 85% of us. It was hardly perfect, but it was ours and, like it or not, it reflected our values and our tastes. We needed to improve the system we had to better serve all Americans. Instead, we are in the process of dismantling our method of paying for health care and interacting with our medical providers.
Jimmy is just, to use the proper term, collateral damage.
DAVE
www.bogartcunix.com
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