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Archive for Health Care Reform

Why Employers Aren’t Rooting for Health Care Reform to Die

Colorado regulators have done the math on health insurance premium hikes and are warning insurers and consumers that blaming steep increases on health care reforms is a convenient myth.

While insurers and politicians said new benefits and consumer protections were helping drive premium hikes of 10 percent to 30 percent for 2011, the actual requests for such new items in mandatory rate filings often required no increase at all.

The impact of the new benefits amounted to a 5 percent increase for some small-group new policies but topped out at 1.2 percent in large-group renewals, the state insurance division said.

The real driver of big insurance hikes remains high inflation for hospital care, doctor fees, new medical devices and increased testing, regulators and consumer advocates said.

"There's been a lot of hyperbole and a lot of hype about health reform driving up the cost of care," said Dede de Percin of the nonprofit Colorado Consumer Health Initiative. "Now that we have the facts, people really need to start paying attention to them and stop putting out misinformation."

Hospitals take most of the ongoing criticism for annual premium increases. A Milliman Medical Index report said costs rose fastest in outpatient hospital care for 2010, at 11.6 percent. Milliman said the hikes were not primarily from increased use but from jumps in the "unit price" of each individual service, device or drug.

Gross hospital charges in Colorado rose an average of 7 percent from September 2009 to September 2010, said Ron Zwerin of the Colorado Hospital Association. The top reasons include an aging workforce with more illnesses, expensive new technology and replacements of aging equipment, pharmacy costs and the use of costly emergency rooms for routine care, Zwerin said.

National requirements that went into effect this fall include expanding policies to cover children up to age 26, removing annual or lifetime limits on payouts, covering more preventive services and allowing pre-existing conditions for children 18 or under. More changes from the health reform law roll out in coming years, with controversial measures including the insurance mandate arriving in 2014.

The Colorado study found large-group insurers filed documents asking for increases of zero to 0.4 of a percent for covering children up to age 26, according to state Insurance Commissioner Marcy Morrison. Small-group insurers, up to 50 employees, said allowing pre-existing conditions for kids under 19 would cost them nothing.

Yet insurance companies are asking for annual premium increases up to 30 percent, Morrison said. A recent study said Colorado businesses face an average increase of 14.4 percent for health costs in 2011, higher than the national average.

Approving the rate requests is not automatic, with Colorado beefing up its review staff and enjoying expanded powers to deny increases. Morrison's reviews can now look at everything from illness levels of employee groups to an insurance CEO's salary to decide what is fair.

"Our folks are drilling down as best they can and looking at what is pushing that 30 percent" in the higher cases, Morrison said.

From the Denver Post November 10, 2010

How 2010 Health Reform Changes May Impact You

How 2010 changes may impact you

Health Care Reform

Lifetime limits

Lifetime limits on the dollar value of essential benefits are now prohibited. This provision clarifies that nothing restricts the use of lifetime dollar limits for covered benefits that are not essential benefits. [Section 2711 of H.R. 3590/Section 2301 of H.R. 4872]Some Insurance Companies have "Grandfathered Plans"

Individual Yes

Insured Group Yes

Self-Funded Group Yes

Non-Grandfathered Plans

Individual Yes

Insured Group Yes

Self-Funded Group Yes

What most insurance companies are doing: Removal of lifetime limits from all plans, upon the next effective date or renewal date on or after Sept. 23, 2010. Check with your insurance companyAnnual maximums

Annual dollar limits are prohibited, except it allows for “restricted” annual dollar limits for essential benefits for plans years beginning prior to January 1, 2014. The regulations allow gradually increasing annual limits ($750,000 for plan year 2011; $1.25 million for plan year 2012; and $2 million for plan year 2013) until the limits are eliminated completely in 2014. It also clarifies that nothing restricts the use of annual dollar limits for covered benefits that are not essential benefits. [Section 2711 of H.R. 3590/Section 2301 of H.R. 4872]

Check with your insurance company for status of grandfathered vs. non grandfathered plans. The regulations establish restricted annual limits that increase until they are eliminated completely in 2014. HHS has agreed to waive the restricted annual benefit limit provisions in PPACA for qualified limited benefits plans until 2014, and we moved quickly to submit the necessary documentation to HHS to obtain waivers to preserve coverage for our limited benefits plan customers.

With the passage of the Patient Protection and Affordable Care Act (PPACA) in March 2010, the nation is moving closer to providing all Americans with access to health care coverage. The new health care reform law includes numerous individual and group comprehensive, major medical insurance market reform provisions that, for the most part, take effect in 2014 or later. Other provisions that are more in line with mandated benefits changes, rather than comprehensive reform, begin to become effective Sept. 23, 2010.

Rescissions and cancellations of coverage

Rescission are prohibited, except for fraud or intentional misrepresentation of material fact. It requires prior notice to the enrollee for cancellations. [Section 2712 of H.R. 3590/Section 2301 of H.R. 4872]Some Insurance Companies have "Grandfathered Plans"

Grandfathered Plans

Individual Yes

Insured Group Yes

Self-Funded Group Yes

Non-Grandfathered Plans

Individual Yes

Insured Group Yes

Self-Funded Group Yes

Check with your insurance company for status of grandfathered vs. non grandfathered plans