Wednesday, April 30, 2014

CDH - Shifting Behavior Rather Than Costs

Since the "birth" of so called Consumer Driven Health Plans (CDHP) in the mid 90's, opponents have argued that CDHP's merely shift health care related costs from employer to employee. This is simply not the case, and health insurer/administrator Cigna's eighth annual "Choice Fund Experience Study" offers quite the opposing view, buttressed by empirically derived facts.  Over the course of CDH's evolution, I have learned a great deal from many of the pioneers and trailblazers of CDH, including the "father of HSAs" (John Goodman), "Mr. HSA" (Roy Ramthun), and the "Godmother of CDH" (Regina Herzlinger).  And studies like Cigna's provide sound data and efficacy to once again advance the fact that CDH LOWERS HEATH CARE COSTS without sacrificing care or coverage!

The study compares actual claims experience from 3.6 million Cigna customers enrolled in CDH, traditional PPO, and HMO health plans.  To access a summary of findings, click here - http://newsroom.cigna.com/images/9022/874630_ExecutiveSummary_FINAL.pdf
Here are some interesting, if not compelling highlights...

To access the complete article, click - https://smstevensandassociates.com/ResourceLibrary/tabid/192/Default.aspx

Wednesday, April 23, 2014

What Employees Should Know About the ACA

I am often asked by HR professionals, CEO's, CFO's, Executive Directors, etc. the following question - "what should I be telling my employees about the Affordable Care Act (ACA)"?  Between the 2,700 pages of the actual law, and the thousands of pages of regulations and guidance released to date, the question is very relevant, and extremely important.  While I firmly believe folks occupying roles with the aforementioned titles should receive a thorough initial overview of the ACA, and ongoing guidance and updates; rank and file employees need only get the absolute critical aspects.  So you might ask - "what are the critical aspects"?

My list of employee-centric, critical aspects is based on the following questions/criteria:

To access the complete article, click - https://smstevensandassociates.com/ResourceLibrary/tabid/192/Default.aspx

Wednesday, April 16, 2014

Workplace Wellness Programs

Within just the past decade or so, Workplace Wellness has become an industry within an industry.  In fact, as a benefits broker/consultant, I get as many calls from Wellness program vendors as I do from insurance companies, seeking new client opportunities.  Recently I came upon an article that made some interesting points relative to Workplace Wellness programs, and the potential outlay of employer dollars in the interest of reducing health care related claims costs.  Here are some thoughts for readers and stakeholders to ponder:

  • On average, U.S. citizens consume about 2,700 calories per day.
  • Healthy food costs significantly more than unhealthy food.
  • The per calorie difference in the cost of healthy versus unhealthy food is significant.  Just look at these examples:
    • Tortilla chips, hot dogs and cheese curls - $.001/calorie
    • Ground beef and Italian sausage - $.003/calorie
    • Apples and pears - $.007/calorie
    • Blueberries, grapes, and cucumbers - $.01/calorie (10 times the chips, dogs, and curls!)
    • Fresh vegetables - $.02/calorie (20 times the chips, dogs, and curls!)
  • On average the difference between the healthy and unhealthy food is about $.33 or 1/3 of a cent.  If you multiply this $.33 x the average daily calorie intake of 2,700, it comes to $9 more, per person, per day to eat healthier.
  • The annual difference in eating healthy versus unhealthy, based on the previous calculation, amounts to $3,000 per person, per year.  
So one way of looking at structuring a Workplace Wellness Program that provides the appropriate incentive to employees (and dependents) to "eat well", would be to compensate for this $3,000 difference, again, per person.  Clearly, such an approach would be neither reasonable or affordable, but it does make you think about one of the major challenges we face as a nation, and as employers offering health insurance benefits. 

Remember, of the $2.7 trillion in U.S. health care spending (in 2012), there are estimates that as much as 75% of this amount is attributable to PREVENTABLE conditions, largely related to certain BEHAVIORS (e.g., eating, drinking, smoking, driving without a seat belt on, etc.).  And one health care economist (Dr. Jonathon Gruber; MIT) estimates that roughly 1/3 of this total outlay ($800 billion) is attributable to unnecessary diagnostic tests, procedures, and extra hospital days.

In conclusion, it benefits all of us to design and implement Workplace Wellness programs that work in conjunction with Consumer Driven Health (CDH) plans, in the interest of helping plan members become better, smarter, and more prudent health care consumers.


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Wednesday, April 2, 2014

Public Marketplaces/Exchanges Still Open!


Despite numerous reports of the "closing" of the Affordable Care Act's (ACA) public health insurance exchanges/marketplaces on March 31, 2014, THEY'RE ACTUALLY STILL OPEN FOR BUSINESS!  Media reports stating that "the exchanges are closed" are simply inaccurate.  Much like group health insurance plans, ACA marketplace/exchange plans have two (2) enrollment periods:
  1. Open Enrollment - which ran from 10/1/13 - 3/31/14 in the inaugural year of the launching of the public marketplaces/exchanges.   IMPORTANT: The Department of Health and Human Services (HHS) announced on March 26, 2014 that it would extend the open enrollment deadline for consumers to enroll in a public marketplace/exchange health insurance plan if they started enrollment before March 31 but weren’t able to complete the application by midnight.; and
  2. Special Enrollment - qualified individuals have another opportunity to obtain coverage both on and off the the public marketplaces/exchanges, on a guarantee issue basis, with all the other ACA related provisions (e.g., community rating, 10 essential health benefits, no pre-existing condition limits, etc.).  Such an opportunity, referred to as a "special enrollment period" is triggered by one or more "circumstances", including, but not limited to the following:
  • loss of coverage (generally involuntary; the lost coverage must meet the ACA's "minimum essential coverage" guidelines);
  • gaining or becoming a dependent through marriage, birth, or adoption;
  • becoming a citizen, national or legally present;
  • mistake by the marketplace/exchange or the department of Health and Human Services (HHS);
  • contract violation by a plan or certain misconduct on the part of a non-Exchange entity providing enrollment assistance or conducting enrollment activities;
  • change in eligibility for federal subsidies;
  • gaining access to a new qualified health plan due to a permanent move; or
  • other exceptional circumstances (defined by the particular State/Federal exchange/marketplace).
Eligible individuals may still purchase subsidized coverage from a Public marketplace/exchange during a special enrollment period. 

Click here for a link to specific guidance relative to special enrollment periods - https://www.healthcare.gov/how-can-i-get-coverage-outside-of-open-enrollment/

Special enrollment periods are generally 60 days from the date of the triggering circumstance or event.  Coverage effective dates follow the rules that apply to open enrollment, which is the first of the month following enrollment made by the 15th of the preceding month.
[Example: coverage applied for between 6/1/14 - 6/15/14 becomes effective 7/1/14.]

And finally -  open enrollment for 2015 will run 11/15/14 - 2/15/15, allowing both new enrollments and changes to existing coverage.  This is a shorter enrollment window of time than was allowed for the 2014 enrollment season.


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