Health-Care Rule’s Delay Is Applauded By Business Groups - Stay Informed!

As Perry Castro contemplated implementing the Affordable Care Act at his business in Virginia, he feared he would need a new full-time employee to handle all the requirements.

In mere months, Allied Associates International would have to tell the government how many hours each of its 70 employees worked, whether they were enrolled in the company’s health plan, and numerous other facts. Such extensive recordkeeping was the last thing the defense contractor needed as it struggled to navigate federal budget cuts and a halting economic recovery, Castro said.

Complaints from small businesses across the country influenced the Obama administration’s decision Tuesday to delay a requirement that all employers with more than 50 workers provide health insurance to employees who log more than 30 hours a week.

 

In the months before the administration’s decision, companies have said they would stop hiring or cut some workers’ hours to part time to avoid the law’s bureaucratic burdens. Others anticipated spending more to keep up with the law’s reporting requirements and to beef up their health insurance offerings.

 

So for many companies such as Castro’s, the one-year delay came as a relief, if only a temporary one.
“Sure, it gives me one more year to operate without the added costs of the new reporting requirements, but other than that, it doesn’t really help us,” said Castro, whose company provides cyber-intelligence and training services to the Defense Department. “As long as that hammer is still cocked and ready to fall, we’re going to get hit with it sometime. It’s just a matter of when.”
The requirements were confusing, burdensome and more work than his staff could handle, Castro said. It is frustrating given that the company already provides health insurance that most employees use, he said.

“I run a very lean back office, which helps me keep my costs down [and] my employees well compensated,” he said. “The more reporting requirements they add, the more my administrative costs go up, and that’s a shame.”

Since the 2010 enactment of the health-care overhaul, business owners have railed against many of its provisions, including the “employer mandate” and its financial penalties for noncompliance.

Businesses said the reporting requirements that come with the law will eat away at valuable staff time or, in cases such as Castro’s, require a new employee.

They say the work would be especially burdensome in many retail and service jobs, where employee hours often shift from week to week and turnover is high.

In addition, many businesses were concerned that the federal reporting systems used by employers to report on their employees’ health benefits were untested. Many complained that the law’s regulations have yet to be fully fleshed out.

At a minimum, business advocacy groups said, the delay will give employers time to learn more about how the health-care marketplace is being reshaped by the law.

Employers said they would benefit by seeing how the new health insurance exchanges are working and what options are available from insurance plans before they make crucial decisions about health-care offerings for their workers.

“It is a welcome relief for most employers, especially for those who had to make some decisions about benefit changes and maybe even workforce changes for 2014,” said Steven Wojcik, vice president of public policy at the National Business Group on Health, a nonprofit association of more than 360 large employers. “We should know a lot more a year from now.”

Although the employer mandate is delayed, other parts of the law are moving forward, creating new tasks for employers.

“This type of ad hoc, individualized reporting beginning this fall and continuing through 2014 is still likely to be administratively challenging for many employers,” said Brian Haile, senior vice president for health policy at Jackson Hewitt Tax Service.

Many opponents of the Affordable Care Act have argued that the law will be a disincentive to create new jobs in a struggling economy, particularly for firms that have just fewer than 5o workers.

Some employers said they would cut workweeks below the 30-hour threshold to avoid the mandate.
The National Federation of Independent Business is among the organizations that have predicted that the law will prove to be as unworkable next year as they believe it is now.

“Temporary relief is small consolation,” said Amanda Austin, director of federal public policy for the business group. “We need a permanent fix to this provision to provide long-term relief for small employers.” 

Original Article By Michael A. Fletcher and J.D. Harrison via http://articles.washingtonpost.com/2013-07-03/business/40344147_1_health-insurance-requirements-employees

Obamacare's Medicaid Expansion Shortfall Shuts Millions Out of Health Care - Must Read!

Rose Ruiz earns $8 an hour taking care of a 67-year-old diabetic on Medicaid in Austin, Tex. At an annualized rate of $16,640, she can’t afford to buy her own medical insurance. Her best shot at getting coverage was through the expansion of Medicaid mandated under the Affordable Care Act. But because of a U.S. Supreme Court decision that the law’s Democratic authors in Congress never anticipated, millions of low-wage workers who were supposed to be helped by Obamacare will probably end up without coverage.

Obamacare set aside billions of dollars for states to expand their Medicaid programs. Twenty-four of them, most led by Republican governors, have opted out since the Supreme Court ruled a year ago that states could choose not to participate in the expansion. That’s left their low-wage workers in a bind: They make too much to qualify for Medicaid in its present form, but too little to afford a plan their employer might offer. And they don’t earn enough to qualify for subsidies available to help the uninsured buy plans on the state-run Obamacare marketplaces opening in October. These subsidies are available to people with modest incomes—$24,000 to $94,000 for a family of four. Democrats in Congress who wrote the law figured anyone making less would get coverage through the Medicaid expansion.

States dictate the rates they pay companies for providing Medicaid services. The companies then decide the hourly wages they pay home-health aides like Ruiz, which average less than $10 an hour nationally, says William Dombi, vice president for law at the National Association for Home Care & Hospice. Many health aides in states that aren’t expanding Medicaid could need pay raises equal to triple their current wages or more to qualify for the Obamacare subsidies. “It’s one of those things that I’m sure nobody thought about when they were putting this together,” Dombi says.

The problem leaves employers with their own predicament. Those who don’t offer coverage face fines of as much as $3,000 per employee. Yet if an employer offers a new health plan for workers who can’t afford the existing one, and the new plan is deemed “affordable” under the law—meaning it would cost an employee no more than 9.5 percent of his income—then the employee becomes ineligible for Obamacare subsidies to buy a potentially cheaper plan offered through a state-run marketplace. “Lots of employers are really agonizing with the decision,” says Steve Wojcik, vice president for public policy at the National Business Group on Health, a lobbying group. They’ll now have more time to figure it out. On July 2, the Obama administration pushed back the penalties, set to take effect next year, to 2015.

The snafu might hurt low earners in Texas the most. The state has the highest rate of uninsured people in the U.S.; expanding Medicaid would have extended coverage to 1.5 million Texans by 2017, according to the state health department. Many home-health aides would have qualified, says Jennie Baird, president of the Texas Association for Home Care & Hospice in Austin.

Only days after the Supreme Court ruled last June, Governor Rick Perry vowed not to let the state expand Medicaid, saying it would “make Texas a mere appendage of the federal government when it comes to health care.” State lawmakers considered a proposal to press ahead with the expansion, but Perry threatened a veto and it died. His spokeswoman, Lucy Nashed, says the governor prefers to make “common-sense” changes to the existing program. He wants Texas to have more authority to limit eligibility for Medicaid, and to charge Medicaid patients co-pays.

Shantelle Williams, a home-health aide who makes $7.25 an hour caring for Medicaid patients near Dallas, is one of the many Texas health-care workers who’s likely to go without any coverage at all. “The politicians don’t know where I’m coming from,” she says. “That decision was for them, it wasn’t for me.”

The bottom line: Because nearly half of U.S. states aren’t expanding Medicaid, poor workers are likely to end up without insurance.

Original Article By Alex Wayne and David Mildenberg via http://www.businessweek.com/articles/2013-07-03/obamacares-medicaid-expansion-shortfall-shuts-millions-out-of-health-care

Why a Health Insurance Penalty May Look Tempting - Says 55% of Americans MUST READ

 Traditional Major Medical Health Insurance Is Looking Less Appealing ????

OFTEN, when the government wants you to do something, it makes you pay if you don’t. That would seem to be the case with Obamacare, which penalizes companies for not providing health care. But in that penalty, there could be a paradoxical result: dropping health coverage could save companies a lot of money.       

 

Minh Uong/The New York Times

$11,429

Employer portion of family health benefit, average current cost

$2,000

Employer penalty for not providing benefits under Obamacare

Once new health insurance exchanges are up and running in October, companies with 50 or more full-time employees will face a choice: Provide affordable care to all full-time employees, or pay a penalty. But that penalty is only $2,000 a person, excluding the first 30 employees. With an employer’s contribution to family health coverage now averaging $11,429 a year, taking that penalty would seem to yield big savings.

      

Yet there may be costs in employee satisfaction, especially if companies don’t raise pay enough to keep workers whole when they buy insurance on the exchanges.

      

“No one wants to drop health insurance and have unhappy employees,” says Rick Wald, who heads Deloitte’s employer health care consulting practice.

      

Few experts see immediate, big changes to existing employer-sponsored coverage. But that may change in time. A generation ago, defined-benefit pensions were prevalent. Not so today.

So why did the government set the penalty at $2,000?

      

Policy experts don’t agree on the rationale, and the White House didn’t respond to requests for comment. Perhaps the intent was to start a gradual shift from employer-sponsored coverage to the new exchanges. Or maybe the low amount was a compromise needed to pass the law.

      

Whatever the reason, the government is about to conduct a huge experiment in corporate decision-making.

      

Sources: 2012 Employer Health Benefits survey from the Kaiser Family Foundation and Health Research and Educational Trust; the Affordable Care Act

Original Article By ANNA BERNASEK via http://www.nytimes.com/2013/06/23/business/why-a-health-insurance-penalty-may-look-tempting.html?_r=0

Risky Health Insurance Bets Could Backfire for Small Employers - A MUST READ!

A growing number of small businesses have tried to reduce their health-care costs in recent years by replacing traditional insurance with self-insured plans. That means that instead of buying policies from big insurers such as Aetna (AET) or WellPoint (WLP), the company sets aside money to pay for workers’ medical claims directly. The practice is common at big companies, where a large number of claims make it easier to predict health-care costs. Most small employers, who can face exploding health bills from a single unexpected illness or injury, have still stuck to conventional insurance.

A new report today from the progressive Washington advocacy group Center for American Progress warns that a shift toward self-insurance by small companies may put their workers’ health and their own finances at risk. Self-insured plans aren’t subject to some of the requirements of health reform, such as the minimum coverage requirements that traditional policies must now provide. And as the CAP report points out, self-insuring can save companies real money if their workers are healthy:

“As long as these employee groups remain young and healthy, there are few incentives for employers to join the fully insured risk pool that includes older, less healthy individuals, who increase the price of insurance premiums.”

But if costs go up—if an employee or family member has a car accident, say, or gets cancer or HIV—the company might choose to buy an insurance policy, where the risk will be shared with other employers. Under Obamacare, insurers aren’t allowed to charge companies with sicker workers higher premiums. This could raise costs for other groups buying insurance:

“Churning between the self- and fully funded markets would allow small businesses to capitalize on the fully funded and regulated market only when employer risk is high without otherwise participating in the risk pool. This adverse selection could, in turn, raise premiums in the fully funded small group market.”

Think of the health insurance system as a spectrum of how much risk is shared. At one extreme would be a system where everybody pays the same amount into a pool of money (a “single payer”) that pays for everybody’s care. Risk is shared completely. At the other extreme, everyone would bear his or her own medical risk directly. There’s no insurance, and people are on their own to pay for the care they need.

The U.S. health-care system operates somewhere in between—risk pools are sliced and diced by geography, employer, and type of insurance. That creates incentives for “adverse selection,” or gaming the system by sharing risk only when you’re likely to have high costs, and going it alone when costs are low.

Some states are trying to rein in the practice of self-insurance by small businesses, mostly by regulating stop-loss insurance. Those are secondary policies that employers buy that will pay out if medical claims get very costly. Last month Colorado passed a law (pdf) to limit how stop-loss policies can be sold to small businesses. It’s not clear yet how much self-insurance by small businesses might affect premium costs in the broader marketplace. But it’s clearly something regulators are watching.

Original Article by: John Tozzi via http://www.businessweek.com/articles/2013-06-19/risky-health-insurance-bets-could-backfire-for-small-employers

OBAMACare Perspective: A Tsunami of Bureaucracy

Americans will be shocked by details of Affordable Care Act

The Affordable Care Act expands America’s healthcare system to provide guaranteed insurance coverage for all citizens, financially incentivizes and targets healthcare providers’ services to improve the wellness of their patients, and makes healthcare’s system of compensation based on wellness instead of fees for the treatment of sickness and disease. These are, philosophically, lofty ACA ideals on which almost everyone can agree.

 

While the concept of universal health insurance promoting wellness for all Americans is good, concerns about implementing the ACA in 2014 on a nationwide basis are these:

• In 2014, the U.S. population will approach 320 million.
• Approximately 50 million U.S. residents are uninsured – a large number of new clients to evaluate and enroll into healthcare insurance plans, as well as provide quality medical services.

• The U.S. healthcare market now services around 250 million persons. Sixteen percent of the U.S. Gross Domestic Product is expended for medical services. Delays and mismanagement could have a significant negative impact on the health of the U.S. economy.

• Over 40 federal government agencies are authorized by ACA legislation to promulgate regulations controlling the healthcare industry. Many of these regulations have not yet been released to the public – even though implementation of the ACA is supposed to commence around October 2013.

• To fund the ACA, every resident will be required to purchase healthcare insurance from a private insurer or from a healthcare insurance exchange operated in each state by either the U.S. government or a state healthcare agency. Healthcare exchanges in over 50 percent of the states have not yet been either announced or established.

The cost will be expensive

The U.S. Supreme Court ruled (National Federation of Independent Businesses v. Sebelius, Secretary of Health and Human Services) that ACA legislation was constitutional and requiring persons not purchasing mandated health insurance to pay a penalty to the U.S. government was a tax levied by Congress.

The ACA created a broad array of new taxes to help pay for the cost of universal healthcare insurance (irs.gov/uac/Affordable-Care-Act-Tax-Provisions).

There are numerous new taxes detailed at the referenced IRS website. Here are a few examples:

• 3.8 percent net investment income tax on unearned individual income over $200,000
• 0.9 percent additional Medicare tax
• 2.3 percent medical device excise tax
• Employer “shared responsibility” payment of $2,000 per employee
• Health insurance company taxes – based on each insurer’s market share
• Brand name prescription drug tax – based on drug maker’s market share
• Individual “shared responsibility” payment – effective in 2014.

ACA legislation was enacted March 23, 2010, and contained about 2,000 pages (healthcare.gov/law). Agencies of the federal government, as authorized by the healthcare law, are in the process of writing and issuing ACA regulations and guidelines. The precise number of pages of ACA guidelines is unknown but healthcare attorneys estimate they could total 20,000 pages by 2014.

As earlier stated, the lofty ideals of the ACA are goals most Americans would support. The concerns relate on how to achieve these goals. Bureaucracies of the U.S. government are not competent to manage one-sixth of the U.S. economy. The power of a free-market economy and the competitive forces of millions of American consumers will be diminished. The few government officials making decisions on healthcare cannot be adequately informed about the medical needs of more than 300 million Americans.

 

Implementation of the ACA could morph info a financial disaster. The healthcare industry could be overwhelmed by massive paperwork, corporate overhead costs, unsustainable operating losses, a backlog of new patients, slow bureaucratic response to time-sensitive matters, and mass confusion by millions of Americans endeavoring to deal with thousands of pages of legislation and regulations.
Only time will tell if the federal government can responsibly regulate the U.S. healthcare system or if ACA legislation reaches too far and attempts to do too much.

Original Article By: Ed Laneis chief executive of Lane Consultants, Inc. and publisher of The Lane Report

California Health Insurance Premiums Under Obamacare Revealed - TN Rates Will Be More!

California Gov. Jerry Brown (D) announced 13 health insurance companies will offer products to the state's residents under President Barack Obama's health care reform law.

           

A 40-year-old Californian with a moderate income will pay between nothing and $219 a month for a basic health insurance plan next year under President Barack Obama's health care reform law, a state agency announced Thursday.

Covered California, the authority in charge of the state's health insurance exchange, has released details about what the health insurance market for individuals who don't get coverage at work will look like next year. In all, 13 health insurance companies will sell products on the exchange, and premiums will range from 2 percent more to 29 percent less than what comparable plans cost this year, the agency said.

California is not only the most populous state in the U.S., but it also has the highest number of uninsured residents, 7.3 million in 2011. The state is tied for the fourth-highest percentage of residents without health insurance at 20 percent, census data show. The state embraced health care reform soon after Obama signed the law in 2010 and is seen as a bellwether for whether the initiative can succeed.

The results of Covered California's negotiations with health insurance companies belie predictions of massive premium increases under the law, at least for products that offer a range of benefits similar to those currently sold to small businesses.

The average cost of a standard health insurance plan sold on the health insurance exchange will range from $304 to $321 a month in the Golden State next year, Covered California announced. Compared to existing plans with comparable benefits and factoring in available subsidies for low- and moderate-income people, prices like these represent either a small increase or a significant decrease in the monthly costs, the agency said.

"This is a home run for consumers in every region of California," Peter Lee, the executive director of Covered California, said in a press release. 'Our active negotiating will not only benefit potential enrollees to Covered California, but will benefit all Californians by making health care affordable.' California is one of just six states that will use their negotiating leverage to force lower premiums under Obamacare.

Health insurance companies and political opponents of the health care reform law repeatedly have cautioned that its benefit mandates and limitations on industry practices like excluding sick people and charging higher rates to women and older people would dramatically raise premiums.
The evidence to date is mixed. In Maryland, CareFirst BlueCross BlueShield requested that the state approve a 25 percent hike in premiums for individuals for next year. In contrast, two health insurers in Oregon actually scaled back their proposed increases after seeing what their competitors planned.
Prices could be higher for individuals who currently buy skimpier coverage than will be permitted under Obamacare in the individual market. The law mandates that insurance covers things like prescription drugs and maternity care, which will tend to increase premiums. This especially could affect younger and healthier customers.

"Californians in the individual market may pay more than they have before for the additional benefits -- even if those are benefits they may never use," the California Association of Health Plans said in a press release.

Tax credit subsidies may offset premium increases for those who earn less than four times the federal poverty level, or $25,960 for a single person this year.

Affordable Rates Available Now! Contact us today!

Starting next year, 5.3 million Californians who don't receive health benefits from their jobs will be eligible to buy health insurance from the exchange marketplace, according to Covered California. Individuals who buy health coverage for themselves rather than get it through their employment represent just 5.6 percent of the state's current health insurance market, the California Association of Health Plans said in a press release Thursday.

California's leading health insurance companies, including Kaiser Permanente, WellPoint subsidiary Anthem Blue Cross, Health Net, and Blue Shield of California will participate in the exchange. Several large national health insurance companies including UnitedHealth Group, Aetna and Cigna, won't sell products through Covered California.

"With today’s announcement, we have proof that health reform can stimulate competition and increase value for consumers," Blue Shield of California President and Chief Executive Officer Paul Markovich said in a press release.

Among those who can purchase health insurance via Covered California, 2.6 million will qualify for financial assistance because they have incomes ranging from 133 percent of the federal poverty level, which is $15,282 for a single person this year, to four times the poverty level. Those with lower incomes will gain access to California's Medicaid program, called Medi-Cal.
Covered California estimates that 46 percent of those eligible to shop on the health insurance exchange will be Latino, 33 percent will be white, 14 percent will be Asian and 4 percent will be African-American.

Under Obama's health care law, four grades of health insurance will be available on the state-based exchanges. They are named after metals that signify the levels of coverage and premiums: Bronze, Silver, Gold and Platinum. Subsidies are based on an individual's income and pegged to the cost of a Silver plan. People younger than 30 can opt for a bare-bones "catastrophic" plan, but cannot receive subsidies to offset its cost.

In practice, that means a 40-year-old Californian can choose among a variety of levels of coverage at a range in price. This table from Covered California illustrates the average amount a consumer will pay, displayed in black, and the value of what the government will pay to insurers, in green.



One of the most important, and least certain, goals of health care reform is to attract younger and healthier people into the health insurance market. This segment of the population would pay premiums into the system but have fewer medical costs, and they are needed to balance the high health care costs of older, sicker people. This is particularly important, since Obamacare forbids health insurance companies from rejecting people with preexisting conditions and restricts how much older customers can be charged.

Unsubsidized catastrophic health insurance will cost an average of $136 to $168 a month for a 21-year-old next year, according to Covered California. That same customer could elect for a Bronze plan that, depending on her income, would cost between nothing and $185, or a Silver plan with monthly premiums that range from $44 to $230.

Read Covered California's report on 2014 health insurance premiums:

via http://www.huffingtonpost.com/2013/05/23/california-health-insurance-premiums_n_3328110.html 

Original Article By: Jeffrey Young

Want to Improve Health Care? Spend Less on It

According to a new study of Medicaid recipients in Oregon, increased health-care spending has only a limited impact on improving people’s health. This points to an underlying reality: Hospitals and doctors’ surgeries may account for a considerable majority of health-care expenditures, but they aren’t the main factors in health outcomes. That’s true not only in the U.S. but around the world.
The Oregon study suggested that expanding Medicaid had considerable benefits: Recipients got more health care and didn’t suffer the impact of catastrophic health costs. Depression rates fell by 30 percent. But after two years, blood pressure and cholesterol levels of participants hadn’t shifted, and while more people were on medicine to control diabetes, the relevant tests suggest the treatments were having limited impact. Better health coverage for particularly vulnerable groups does save lives, but previous analyses have also suggested that a general expansion in insurance coverage doesn’t necessarily do a huge amount for health outcomes.

Americans get terrible value for money from their health spending. According to data from the World Bank, the U.S. spends $8,608 per person per year on health care. But the country has a lower average life expectancy than Chile, where health expenditure is $1,292 per year, or Israel, where expenditure is $2,172 per year. U.S. life expectancy is nearly four years shorter than it is in Spain, yet Spain’s annual health expenditure per person is about one-third of the U.S. level.

One reason for that weak link is the obscene prices charged by U.S. health providers. American hospitals as a whole often charge two to four times as much for a procedure than the cost of flying overseas and then paying full price for the same treatment somewhere else. But in partial defense of U.S. health care, the link between health expenditure and health outcomes is weak worldwide. The relationship between the number of doctors or hospitals in a country and mortality rates is even weaker. That’s because the measures that are most effective in raising a population’s life expectancy don’t require complex medical techniques and don’t cost that much.

The cheap interventions include vaccines that can be had for cents a shot. They can pretty much wipe out the risk of dying from a range of communicable diseases. Measles is one example: Thanks to more widespread vaccine coverage, the number of kids dying each year from the disease has fallen from 2.6 million in 1980 to 139,000 in 2010. Add a few more simple things—such as sugar-salt solutions to treat diarrhea, antibiotics to fight a range of infections, and better health practices such as washing with soap—and you massively reduce mortality rates, especially among young people. That’s how Vietnam can spend 63¢ a day per person on health care and get a life expectancy of 75 years—only marginally behind the U.S. expectancy of 79 years.

At the same time, as people get richer, they spend more money on health care but also more money on a range of things that make them sick—such things as fats, cigarettes, sugar, and alcohol. About a third of the world’s adult population now smokes, and cigarettes kill five million people a year. Over the past 30 years, global obesity rates have approximately doubled, and obesity takes away 36 million years of healthy life pdf) from the world’s population every year.

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That’s why health can sometimes improve when people have less money to spend. Cuba’s economy nosedived in the 1990s after the Soviet Union’s support ended. A recent study in the British Medical Journal reports that between 1980 and 1997, the average Cuban lost more than 5 kg in weight, obesity rates plummeted, and cigarette consumption per person fell by half. Deaths due to diabetes also halved between 1996 and 2002, and deaths from coronary heart disease fell more than a third. As Cuba’s economy recovered, deaths due to diabetes returned to precrisis levels.

Back in the U.S., obesity rates have declined slightly since 2009—falling from 26.5 percent of the population to 26.2 percent. Smoking rates also fell. Perhaps part of that is a very small silver lining to the recession. Overall, improving diet and exercise habits, combined with weaning a fifth of the population off nicotine, would do more to improve health than throwing yet more money at a dysfunctional health-care system.

With lower violent crime and safer driving as well, the U.S. might even surpass Spanish levels of life expectancy, for a fraction of what Americans spend on health care today. Doctors and hospitals can do some things to ameliorate the results of our addictions to fat, sugar, nicotine, guns and automobiles –but it would be far better for America’s health to fix the addictions themselves.
It’s shocking that, in one of the richest countries in the world, millions are still denied access to health care—and especially preventative services—because they can’t afford coverage. And the pain and disruption associated with paying medical bills is immense. The U.S.’s move toward universal health coverage is a step in the right direction. But the U.S. also needs to get more serious about keeping people out of doctors’ offices and hospitals in the first place. That’s the most effective –and by far the cheapest— path to longer, healthier lives.

Original Article By Charles Kenny via http://www.businessweek.com/articles/2013-05-13/want-to-improve-health-care-spend-less-on-it