Original Story: latimes.com
Industry giant UnitedHealth has warned it may quit selling Obamacare coverage across the country, raising questions about an expansion in California.
The nation's largest health insurer cut its earnings forecast Thursday, citing slower growth on public exchanges under the Affordable Care Act and higher-than-expected claims for those individual policies. A San Diego health care lawyer have experience with multiple industry types and implications of detrimental health care practices or incidents.
The company said it was pulling back on its marketing of health-law coverage just a few weeks after open enrollment began Nov. 1. UnitedHealth said it will decide in the first half of next year “to what extent it can continue to serve the public exchange markets in 2017.”
UnitedHealth Chief Executive Stephen Hemsley told analysts and investors that “we cannot sustain these losses.... We can't really subsidize a marketplace that doesn't appear at the moment to be sustaining itself.”
The announcement comes as UnitedHealth is seeking a toehold in California’s Obamacare market — after snubbing the state two years ago. A Cleveland health care attorney is following this story closely.
Nationwide, UnitedHealth has more than 500,000 people enrolled on government exchanges out of about 10 million Americans who have signed up. Rivals Anthem and Aetna both have a bigger presence with a combined enrollment of about 1.6 million people.
Analysts said the exchanges can continue to function without UnitedHealth, but stagnant enrollment is a concern industrywide.
UnitedHealth’s exit “would be a blow to multiple exchange markets, but not a death knell,” said Bill Melville, a senior analyst for Decision Resources Group, a research firm in Burlington, Mass. “All insurers in the exchanges are facing similarly rough head winds.”
Enrollment growth has slowed as many of the uninsured balk at buying high-deductible health plans, even with federal subsidies available. It's crucial for insurers to sign up enough healthy people to help pay for sicker policyholders who eagerly seek out coverage.
Federal officials estimate that about 10.5 million uninsured Americans are eligible to sign up for coverage through the marketplaces but have not enrolled.
“The policies are still too expensive, and the deductibles and co-pays are too high for other than the poorest,” said Robert Laszewski, a healthcare consultant in Virginia who has closely tracked the overhaul.
He noted that much of the reduction in the ranks of the uninsured has come from expanding Medicaid, the government health program for the poor.
The Obama administration said the number of health plans offering exchange policies has increased since the 2014 launch, and it expects the individual market will stabilize as adjustments are made. A Houston health care lawyer is reviewing the details of this story.
“The health insurance marketplace is entering its third year and continues to grow, giving millions of Americans access to quality affordable insurance,” said Ben Wakana, a spokesman for the U.S. Department of Health and Human Services. “Today’s statement by one issuer is not indicative of the marketplace’s strength and viability.”
UnitedHealth just joined the Covered California exchange this month after sitting out the first two years. The company sought permission in January to sell statewide, but California officials limited the insurer to several smaller markets for 2016.
Those areas are predominantly rural counties in Northern California, but they also include Santa Barbara, Ventura and San Luis Obispo counties.
Covered California imposed that restriction because UnitedHealth left the state's individual market at the end of 2013 and spurned the launch of the exchange.
Peter Lee, executive director of Covered California, said he spoke with UnitedHealth officials Thursday and remains confident about the company’s continued expansion in the state.
"We have every indication they are all in for 2016 and 2017," Lee said in an interview. "The fact United did badly in other parts of the country, like many health plans did, is exactly why they want to be in California." A Coral Gables health care lawyer provides professional legal counsel and extensive experience in many aspects of health care law.
A spokesman for UnitedHealth said no decision has been made on its future participation in Covered California. “We will make an assessment of 2017 markets in the first quarter of 2016,” spokesman Tyler Mason said.
Many consumer groups welcomed UnitedHealth's arrival in Covered California in order to give people more choice and inject more competition into the market. The top four insurers in the exchange, led by Anthem and Blue Shield of California, control about 94% of Covered California enrollment.
The state has about 1.3 million people enrolled, and nearly 90% of them receive federal premium subsidies.
Covered California fell short of its enrollment goal during the second sign-up period, and it has acknowledged that reaching the remaining uninsured is difficult.
This week, the state said 34,000 new enrollees had picked out a health plan since Nov. 1. That's behind last year's pace but within state projections, officials said.
The announcement Thursday marked a sudden shift for UnitedHealth, which had sounded bullish about the health law in recent months. The company initially sold coverage on only four government-run exchanges before expanding to 23 this year. It will be selling in 34 states for 2016.
UnitedHealth said it cut its profit forecast to account for $425 million in losses it expects on individual policies this year and in 2016. The company expects 2015 earnings of about $6 a share, down from its previous estimate for $6.25 to $6.35 a share.
Shares of UnitedHealth slid $6.62, or 5.7%, to $110.63 in Thursday trading. Other health stocks took a beating after the company’s warning. Shares of Anthem, the nation’s second-largest health insurer, fell 7%, and hospital chain Tenet Healthcare dropped 8%.
After the news from UnitedHealth, HMO giant Kaiser Permanente reiterated its support for health-law exchanges.
“American healthcare is undergoing significant change and evolution, and the health exchanges are part of that disruption,” said Kaiser Permanente CEO Bernard Tyson. “While there have been challenges at times, we believe at the end of the day they are causing healthy disruption.”
Showing posts with label Affordable Care Act. Show all posts
Showing posts with label Affordable Care Act. Show all posts
20 November 2015
19 August 2015
MICHIGAN AGENCY: HEALTH INSURANCE TO RISE 6.5% IN 2016
Original Story: detroitnews.com
Lansing — Michigan consumers will pay an average 6.5 percent more for health insurance in 2016, which is less than the rate hike they paid during the past year, state officials said Tuesday.
State officials and industry leaders called the increases modest compared with an 8 percent rise in 2015, but some health care advocates said too little information is available about how rates are calculated for consumers to judge whether the hikes are warranted. Farmington Hills elder care services assist individuals with even the most advanced medical needs.
The 2016 rate increases approved by the Michigan Department of Insurance and Financial Services are lower than those in several other states for federally required health insurance under the 2010 federal law, state officials noted.
The average approved rate changes on a premium weighted basis increased 6.5 percent for the 560,357 consumers in the individual market and 1 percent for the 345,077 consumers in the small group or small business market.
“Many states are reporting rate increases well in excess of 10 percent which is significantly higher than the rate of health care inflation,” Department of Insurance and Financial Services Director Patrick McPharlin said in a Tuesday statement. “We are pleased that Michigan consumers are seeing more modest increases.” In-home caregivers tailor home care services to the needs of each client and family including private duty skilled nursing.
Josh Fangmeier, senior policy analyst with the University of Michigan’s Center for Heathcare Research and Transformation, noted that some insurance companies asked for minimal rate increases, or even decreased their rates. But consumers in some parts of the state have few plans to choose from.
“Not all of these insurers are statewide, so ... it’s important to keep in mind that consumer experiences will vary depending on where you live,” Fangmeier said.
In 2015, the average increase was 8 percent in the individual market and 5.7 percent in the small group market, DIFS spokeswoman Andrea Miller said Tuesday. The rate changes for 2014 were not estimated because of essential health benefits and other requirements of the federal Affordable Care Act that took effect that year. Plymouth elder care services provides patients with intensive, highly specialized care.
A Michigan health insurance industry official said in June the possible loss of federal insurance subsidies through a U.S. Supreme Court case was in part to blame for the proposed rate hikes. But the court later that month kept the Affordable Care Act subsidies in place and decided they were constitutional in a 6-3 ruling.
Rick Murdock, executive director of the Michigan Association of Health Plans, noted this is the industry’s third year of business in the health care marketplace created by the federal Affordable Care Act.
“Year one was sort of pricing it blind; year two, which was last year, there were significant adjustments — double-digit reductions for some, and double-digit increases for others, as they were trying to get to the middle,” Murdock said. “This year everyone seems to have made a modest adjustment based on what’s going on in health care.”
The rate hikes proposed by insurance companies were reviewed by state officials, who determined they are actuarially appropriate and comply with state and federal laws. But Ryan Sullivan, policy director for Michigan Consumers for Healthcare, said state regulators don’t provide information about the process that consumers can understand.
“We really don’t know how to put (the rate increases) into context because of a lot of lagging transparency in the process,” Sullivan said Tuesday. “What consumers can access via the web and by calling the department is pretty slim pickings.”
The state defended its practices. Miller said consumers can access rate increase filings and other detailed information through the department’s website at http://www.michigan.gov/difs.
“We’re trying to be as transparent as we possibly can be,” she said.
The state’s dominant insurer — Blue Cross Blue Shield of Michigan — will apply a double-digit increase of 11.4 percent. Its health maintenance organization, Blue Care Network, plans to hike its rates 9.7 percent.
In June, a Blues official said an increase in prescription and specialty drug costs is behind the rate hike. Blue Cross had 138,169 people sign up for individual plans in 2015, while another 171,831 people with individual Blue Care Network policies will see average increases of 9.7 percent. A Chicago health care lawyer is following this story closely.
Blues spokeswoman Helen Stojik noted their small group customers will benefit from a downward rate adjustment. Rates for employers renewing coverage in the third and fourth quarters of 2015 will be, on average, 3.3 percent lower for Blues customers and 0.8 percent higher for Blue Care Network customers.
“In addition, 2016 rate changes look extremely favorable, with Blue Cross annual rate changes projected 2.2 percent lower and Blue Care Network projected at 4.8 percent lower than the previous year,” Stojik said Tuesday.
But the Blues didn’t register the largest rate increases. Those belonged to Healthplus of Michigan at 35.8 percent, Consumers Mutual Insurance of Michigan at 20.5 percent and United Healthcare Community Plan at 14.7 percent.
Three insurers are countering the trend and dropping their rates in the coming year, according to the state.
Meridian Health Plan had the biggest decline with a 12.6 percent plunge, followed by Molina Health Care with a 8.6 percent decrease and Humana Medical Plan of Michigan with a 4.9 percent drop.
Michigan companies attributed their increases to higher-than-expected claim costs, annual health care cost increases and an expected reduction in federal program reinsurance recoveries, officials said.
The small increase in the small group market occurred because many companies experienced better than expected results that offset most of the change in annual health care costs.
“Ensuring rates are adequate but not excessive is critical to make sure consumers not only receive health insurance coverage at a reasonable price, but can count on the coverage they purchase,” McPharlin noted. “Michigan has a stable and competitive health insurance market with a range of options and premiums for consumers and businesses.”
Open enrollment for 2016 begins Nov. 1, 2015 and continues through Jan. 31, 2016. State officials are encouraging consumers to contact their insurance carrier, agent, or navigator about how the rate changes could affect their policies.
Lansing — Michigan consumers will pay an average 6.5 percent more for health insurance in 2016, which is less than the rate hike they paid during the past year, state officials said Tuesday.
State officials and industry leaders called the increases modest compared with an 8 percent rise in 2015, but some health care advocates said too little information is available about how rates are calculated for consumers to judge whether the hikes are warranted. Farmington Hills elder care services assist individuals with even the most advanced medical needs.
The 2016 rate increases approved by the Michigan Department of Insurance and Financial Services are lower than those in several other states for federally required health insurance under the 2010 federal law, state officials noted.
The average approved rate changes on a premium weighted basis increased 6.5 percent for the 560,357 consumers in the individual market and 1 percent for the 345,077 consumers in the small group or small business market.
“Many states are reporting rate increases well in excess of 10 percent which is significantly higher than the rate of health care inflation,” Department of Insurance and Financial Services Director Patrick McPharlin said in a Tuesday statement. “We are pleased that Michigan consumers are seeing more modest increases.” In-home caregivers tailor home care services to the needs of each client and family including private duty skilled nursing.
Josh Fangmeier, senior policy analyst with the University of Michigan’s Center for Heathcare Research and Transformation, noted that some insurance companies asked for minimal rate increases, or even decreased their rates. But consumers in some parts of the state have few plans to choose from.
“Not all of these insurers are statewide, so ... it’s important to keep in mind that consumer experiences will vary depending on where you live,” Fangmeier said.
In 2015, the average increase was 8 percent in the individual market and 5.7 percent in the small group market, DIFS spokeswoman Andrea Miller said Tuesday. The rate changes for 2014 were not estimated because of essential health benefits and other requirements of the federal Affordable Care Act that took effect that year. Plymouth elder care services provides patients with intensive, highly specialized care.
A Michigan health insurance industry official said in June the possible loss of federal insurance subsidies through a U.S. Supreme Court case was in part to blame for the proposed rate hikes. But the court later that month kept the Affordable Care Act subsidies in place and decided they were constitutional in a 6-3 ruling.
Rick Murdock, executive director of the Michigan Association of Health Plans, noted this is the industry’s third year of business in the health care marketplace created by the federal Affordable Care Act.
“Year one was sort of pricing it blind; year two, which was last year, there were significant adjustments — double-digit reductions for some, and double-digit increases for others, as they were trying to get to the middle,” Murdock said. “This year everyone seems to have made a modest adjustment based on what’s going on in health care.”
The rate hikes proposed by insurance companies were reviewed by state officials, who determined they are actuarially appropriate and comply with state and federal laws. But Ryan Sullivan, policy director for Michigan Consumers for Healthcare, said state regulators don’t provide information about the process that consumers can understand.
“We really don’t know how to put (the rate increases) into context because of a lot of lagging transparency in the process,” Sullivan said Tuesday. “What consumers can access via the web and by calling the department is pretty slim pickings.”
The state defended its practices. Miller said consumers can access rate increase filings and other detailed information through the department’s website at http://www.michigan.gov/difs.
“We’re trying to be as transparent as we possibly can be,” she said.
The state’s dominant insurer — Blue Cross Blue Shield of Michigan — will apply a double-digit increase of 11.4 percent. Its health maintenance organization, Blue Care Network, plans to hike its rates 9.7 percent.
In June, a Blues official said an increase in prescription and specialty drug costs is behind the rate hike. Blue Cross had 138,169 people sign up for individual plans in 2015, while another 171,831 people with individual Blue Care Network policies will see average increases of 9.7 percent. A Chicago health care lawyer is following this story closely.
Blues spokeswoman Helen Stojik noted their small group customers will benefit from a downward rate adjustment. Rates for employers renewing coverage in the third and fourth quarters of 2015 will be, on average, 3.3 percent lower for Blues customers and 0.8 percent higher for Blue Care Network customers.
“In addition, 2016 rate changes look extremely favorable, with Blue Cross annual rate changes projected 2.2 percent lower and Blue Care Network projected at 4.8 percent lower than the previous year,” Stojik said Tuesday.
But the Blues didn’t register the largest rate increases. Those belonged to Healthplus of Michigan at 35.8 percent, Consumers Mutual Insurance of Michigan at 20.5 percent and United Healthcare Community Plan at 14.7 percent.
Three insurers are countering the trend and dropping their rates in the coming year, according to the state.
Meridian Health Plan had the biggest decline with a 12.6 percent plunge, followed by Molina Health Care with a 8.6 percent decrease and Humana Medical Plan of Michigan with a 4.9 percent drop.
Michigan companies attributed their increases to higher-than-expected claim costs, annual health care cost increases and an expected reduction in federal program reinsurance recoveries, officials said.
The small increase in the small group market occurred because many companies experienced better than expected results that offset most of the change in annual health care costs.
“Ensuring rates are adequate but not excessive is critical to make sure consumers not only receive health insurance coverage at a reasonable price, but can count on the coverage they purchase,” McPharlin noted. “Michigan has a stable and competitive health insurance market with a range of options and premiums for consumers and businesses.”
Open enrollment for 2016 begins Nov. 1, 2015 and continues through Jan. 31, 2016. State officials are encouraging consumers to contact their insurance carrier, agent, or navigator about how the rate changes could affect their policies.
27 July 2015
ANTHEM TO BUY CIGNA FOR $48.3 BILLION
Original Story: nytimes.com
The health insurer Anthem said on Friday that it had agreed to acquire its rival Cigna for $48.3 billion in a deal that would further concentrate the United States market to just a few major players.
The combined company would have estimated revenue of about $115 billion and serve more than 53 million people with medical coverage. An Atlanta healthcare litigation attorney is following this story closely.
A flurry of deals are reshaping the industry. Earlier this month Aetna agreed to acquire Humana, the smallest of the big five insurers, for $37 billion in cash and stock. If both transactions are completed, the number of major health insurers in the United States will shrink to three.
Health insurers are seeking to consolidate to gain greater scale to reduce costs and capitalize on growing opportunities in the government and individual markets. A major force has been the Obama administration’s health care overhaul, which has bolstered revenues. But greater transparency in pricing and less generous funding of government plans have also put profit margins under pressure.
Alex Cullen, an analyst with Forrester Research, said that the challenge for all health insurers was moving from “a plan and claim-centric model to a customer-centric model.” Making that transition while completing a merger will be difficult, he said. An Atlanta healthcare litigation lawyer is reviewing the details of this case.
“I would expect a lot of angst within Anthem management on how to execute on a customer-centric strategy,” Mr. Cullen said.
Anthem said on Friday that it expected to achieve nearly $2 billion in annual cost savings as a result of the merger. Anthem said there would be one-time charges of $600 million over a two-year period associated with the merger.
“We believe that this transaction will allow us to enhance our competitive position and be better positioned to apply the insights and access of a broad network and dedicated local presence to the health care challenges of the increasingly diverse markets, membership, and communities we serve,” Joseph R. Swedish, the Anthem chief executive, said in a news release.
Mr. Swedish will oversee the combined insurer.
Anthem, based in Indianapolis, operates Blue Cross plans in 14 states and has a strong presence in offering Medicaid plans. Cigna, based in Bloomfield, Conn., is best known for offering plans through employers and selling other kinds of insurance like dental and disability. A Birmingham healthcare lawyer represents clients in business operations and representative matters.
Unlike Cigna, Anthem has been a major presence on the public insurance marketplaces created by the federal health care law.
The recent appetite for deals among insurers was recently whetted by the Supreme Court’s upholding of the portion of the Affordable Care Act that subsidizes consumers who buy policies through the government’s online marketplace.
Under the terms of the deal, Anthem said it would pay $103.40 a share in cash and 0.5152 share in Anthem stock, or $188 a share. That represents a 38.4 percent premium to Cigna’s closing price on May 28, before news of Anthem’s interest emerged. Based on Cigna’s most recent disclosure of shares outstanding, the deal would value its equity at $48.3 million. Including the assumption of debt, Anthem said the deal would value Cigna at $54.2 billion.
After the deal is completed, Anthem shareholders will own 67 percent of the combined company, while the remaining 33 percent will be owned by Cigna shareholders.
David M. Cordani, the Cigna president and chief executive, will serve as president and chief operating officer of the combined company. The Anthem board of directors will also be expanded to 14 members and will include Mr. Cordani and four independent directors from Cigna.
The transaction is subject to shareholder and regulatory approval, and it is expected to close in the second half of 2016. A Pittsburgh healthcare lawyer represents physicians, hospitals, health systems, long-term facilities and other health care providers in a broad range of health care matters.
The deal has long been foretold. Anthem went public with its offer last month, saying that it had been in talks with Cigna over a possible combination since August.
It is possible that regulators in the United States could block some mergers: Antitrust officials at the Justice Department and the Federal Trade Commission have shown an increasing willingness to do so if they believe the alliances could hurt consumers.
Analysts have said that antitrust regulators would probably allow only some deals to go forward, and that they could stop others if they decided that too much power was being concentrated in too few hands.
The question remains what UnitedHealth Group, the largest health insurer in the United States, will now do.
UBS and Credit Suisse and the law firm White & Case advised Anthem, while Morgan Stanley and the law firm Cravath, Swaine & Moore advised Cigna.
The health insurer Anthem said on Friday that it had agreed to acquire its rival Cigna for $48.3 billion in a deal that would further concentrate the United States market to just a few major players.
The combined company would have estimated revenue of about $115 billion and serve more than 53 million people with medical coverage. An Atlanta healthcare litigation attorney is following this story closely.
A flurry of deals are reshaping the industry. Earlier this month Aetna agreed to acquire Humana, the smallest of the big five insurers, for $37 billion in cash and stock. If both transactions are completed, the number of major health insurers in the United States will shrink to three.
Health insurers are seeking to consolidate to gain greater scale to reduce costs and capitalize on growing opportunities in the government and individual markets. A major force has been the Obama administration’s health care overhaul, which has bolstered revenues. But greater transparency in pricing and less generous funding of government plans have also put profit margins under pressure.
Alex Cullen, an analyst with Forrester Research, said that the challenge for all health insurers was moving from “a plan and claim-centric model to a customer-centric model.” Making that transition while completing a merger will be difficult, he said. An Atlanta healthcare litigation lawyer is reviewing the details of this case.
“I would expect a lot of angst within Anthem management on how to execute on a customer-centric strategy,” Mr. Cullen said.
Anthem said on Friday that it expected to achieve nearly $2 billion in annual cost savings as a result of the merger. Anthem said there would be one-time charges of $600 million over a two-year period associated with the merger.
“We believe that this transaction will allow us to enhance our competitive position and be better positioned to apply the insights and access of a broad network and dedicated local presence to the health care challenges of the increasingly diverse markets, membership, and communities we serve,” Joseph R. Swedish, the Anthem chief executive, said in a news release.
Mr. Swedish will oversee the combined insurer.
Anthem, based in Indianapolis, operates Blue Cross plans in 14 states and has a strong presence in offering Medicaid plans. Cigna, based in Bloomfield, Conn., is best known for offering plans through employers and selling other kinds of insurance like dental and disability. A Birmingham healthcare lawyer represents clients in business operations and representative matters.
Unlike Cigna, Anthem has been a major presence on the public insurance marketplaces created by the federal health care law.
The recent appetite for deals among insurers was recently whetted by the Supreme Court’s upholding of the portion of the Affordable Care Act that subsidizes consumers who buy policies through the government’s online marketplace.
Under the terms of the deal, Anthem said it would pay $103.40 a share in cash and 0.5152 share in Anthem stock, or $188 a share. That represents a 38.4 percent premium to Cigna’s closing price on May 28, before news of Anthem’s interest emerged. Based on Cigna’s most recent disclosure of shares outstanding, the deal would value its equity at $48.3 million. Including the assumption of debt, Anthem said the deal would value Cigna at $54.2 billion.
After the deal is completed, Anthem shareholders will own 67 percent of the combined company, while the remaining 33 percent will be owned by Cigna shareholders.
David M. Cordani, the Cigna president and chief executive, will serve as president and chief operating officer of the combined company. The Anthem board of directors will also be expanded to 14 members and will include Mr. Cordani and four independent directors from Cigna.
The transaction is subject to shareholder and regulatory approval, and it is expected to close in the second half of 2016. A Pittsburgh healthcare lawyer represents physicians, hospitals, health systems, long-term facilities and other health care providers in a broad range of health care matters.
The deal has long been foretold. Anthem went public with its offer last month, saying that it had been in talks with Cigna over a possible combination since August.
It is possible that regulators in the United States could block some mergers: Antitrust officials at the Justice Department and the Federal Trade Commission have shown an increasing willingness to do so if they believe the alliances could hurt consumers.
Analysts have said that antitrust regulators would probably allow only some deals to go forward, and that they could stop others if they decided that too much power was being concentrated in too few hands.
The question remains what UnitedHealth Group, the largest health insurer in the United States, will now do.
UBS and Credit Suisse and the law firm White & Case advised Anthem, while Morgan Stanley and the law firm Cravath, Swaine & Moore advised Cigna.
27 October 2014
30,000 CALIFORNIANS FACE OBAMACARE ENROLLMENT DELAYS, DROPPED COVERAGE
Original Story: latimes.com
California's health insurance exchange is vowing to fix enrollment delays and dropped coverage for about 30,000 consumers before the next sign-up period this fall.
Covered California said it failed to promptly send insurance applications for 20,000 people to health plans recently, causing delays and confusion over their coverage.
Another group of up to 10,000 people have had their insurance coverage canceled prematurely because they were deemed eligible for Medi-Cal based on a check of their income, officials said.
The exchange said the private insurance should remain in place until coverage kicks in under Medi-Cal, the state's Medicaid program for lower-income residents.
"There have been some cases of individuals where the wires got crossed and people were removed from Covered California before Medi-Cal was live," said Peter Lee, executive director of Covered California. "It's been a limited number of cases, but it's still a concern."
At the same time, Covered California has been contacting nearly 100,000 households that risked losing coverage if they didn't provide proof of citizenship or legal residency.
Covered California said it has cleared half of that list and about 50,000 households must still provide verification. Their coverage under the Affordable Care Act will be canceled Oct. 31 if they fail to provide the proper documentation.
That verification effort, in particular, has taken a toll on the state's customer service, according to the exchange.
Less than 1% of callers reached the exchange within 30 seconds last month; the state's goal is an 80% response rate in half a minute.
Sixty-four percent of people abandoned their call entirely.
Lee attributed the poor performance to shifting call-center workers to citizenship and residency issues.
"We have taken a lot of people off the phone in the past month," Lee said. "Unfortunately, we haven't been answering the phone as quickly as we would like."
Robert Ross, a Covered California board member, asked at last week's board meeting whether there was a plan to reduce wait times before calls ramp up when open enrollment begins Nov. 15.
Also, about 1.2 million enrollees will be looking to renew their coverage or shop for a new policy prior to January.
Lee said the exchange is close to hiring an outside vendor to supply extra call-center support during peak times.
He also noted that upgrades to the state website should decrease the number of consumer questions and calls.
For instance, applicants will be able to pay their initial premium online at sign-up rather than wait for their insurer to bill them. That two-step process confused many consumers who were unsure about the status of their coverage, and it triggered a high volume of calls.
California's health insurance exchange is vowing to fix enrollment delays and dropped coverage for about 30,000 consumers before the next sign-up period this fall.
Covered California said it failed to promptly send insurance applications for 20,000 people to health plans recently, causing delays and confusion over their coverage.
Another group of up to 10,000 people have had their insurance coverage canceled prematurely because they were deemed eligible for Medi-Cal based on a check of their income, officials said.
The exchange said the private insurance should remain in place until coverage kicks in under Medi-Cal, the state's Medicaid program for lower-income residents.
"There have been some cases of individuals where the wires got crossed and people were removed from Covered California before Medi-Cal was live," said Peter Lee, executive director of Covered California. "It's been a limited number of cases, but it's still a concern."
At the same time, Covered California has been contacting nearly 100,000 households that risked losing coverage if they didn't provide proof of citizenship or legal residency.
Covered California said it has cleared half of that list and about 50,000 households must still provide verification. Their coverage under the Affordable Care Act will be canceled Oct. 31 if they fail to provide the proper documentation.
That verification effort, in particular, has taken a toll on the state's customer service, according to the exchange.
Less than 1% of callers reached the exchange within 30 seconds last month; the state's goal is an 80% response rate in half a minute.
Sixty-four percent of people abandoned their call entirely.
Lee attributed the poor performance to shifting call-center workers to citizenship and residency issues.
"We have taken a lot of people off the phone in the past month," Lee said. "Unfortunately, we haven't been answering the phone as quickly as we would like."
Robert Ross, a Covered California board member, asked at last week's board meeting whether there was a plan to reduce wait times before calls ramp up when open enrollment begins Nov. 15.
Also, about 1.2 million enrollees will be looking to renew their coverage or shop for a new policy prior to January.
Lee said the exchange is close to hiring an outside vendor to supply extra call-center support during peak times.
He also noted that upgrades to the state website should decrease the number of consumer questions and calls.
For instance, applicants will be able to pay their initial premium online at sign-up rather than wait for their insurer to bill them. That two-step process confused many consumers who were unsure about the status of their coverage, and it triggered a high volume of calls.
21 May 2014
INSURANCE QUIRK CONCERNS DOCTORS
Original Story: DetroitNews.com
A quirk in Obamacare has doctors throughout Michigan worried they’re going to be stuck with unpaid bills or forced to become bill collectors when treating patients.
The Affordable Care Act, in a rule published by Centers for Medicare & Medicaid Services, dictates that patients enrolled in government-subsidized health plans — individuals who have purchased a plan from the marketplace and receive a tax credit for it — have their medical bills covered by insurers for 30 days.
But during the following 60-day grace period, insurers may “pend” or hold off paying the claims and, ultimately, deny payments if the patient doesn’t catch up on his or her premiums.
That means doctors will get paid only if they collect directly from the patient long after an appointment, a move that the American Medical Association says “could pose a significant financial risk for medical practices.”
The AMA is so concerned about this rule that it’s created a step-by-step guide for its physician members to minimize their risks, and it includes a “Dear Patient” notice to mail. And some doctors have been reluctant to treat patients with plans they purchased from the marketplace — resulting in less access to health care for consumers.
“Managing risk is typically a role for insurers, but the grace period rule transfers two-thirds of that risk from the insurers to physicians and health care providers,” said AMA President Ardis Dee Hoven in a statement.
Previously, insurers generally would cancel a policy if a subscriber fell behind more than 30 days, rather than the ACA’s 90 days. The insurer, rather than the doctor, would be responsible for bills incurred before that cancellation.
With the new grace period, the burden is shifted to the doctors and their billing departments to collect money that a patient owes. Doctors’ offices are likely to to hire bill collectors if initial efforts to collect for unpaid services are unsuccessful. Doctors’ offices have financial counselors to help uninsured patients come with payment plans.
“We’ve been talking about this rule for more than a year,” said Dr. Randall Bickle, a family practitioner in Northville and the chief executive and medical director of Olympia Medical Services, a Livonia-based physicians group.
“The issue for doctors is, how aggressive are you willing to be to go after that payment and are you going to be available to send that money back if they pay the premium in full?” Bickle said, describing some of the questions that have popped up since this quirk was discovered.
The Michigan State Medical Society, which represents 15,000 doctors, has been educating its members about the rule as well, said Rebecca Black, the society’s senior director of health care delivery and education.
“Physicians are so overwhelmed right now because there are so many mandates that they are supposed to be a part of or they will start to get penalized,” Black said. “Because they have so much going on, it’s a good time to remind our membership to check insurance eligibility with every office visit.”
One of those overwhelmed is Dr. Annemarie Poleck, who practices family medicine solo in the office her father, Dr. Stanley Poleck, founded in Detroit. While her staff checks the eligibility prior to each appointment, often an insurance company fails to have the most current information, giving her a green light to treat, rather than a red.
Poleck is already seeing signs of the impact of this 90-day grace period. Recently, she referred a patient to a podiatrist for a broken ankle. Two podiatrists, leery of the patient’s marketplace health care, refused to see her unless she paid in advance for their service that she would receive in the future. A third podiatrist finally agreed without the upfront payment stipulation.
“I expect a lot of doctors will refuse to see patients in the future because they are worried about payment, and that goes against our training,” Poleck said.
Dr. Robert Frank, chief executive and chief medical officer of Wayne State University Physician Group in Detroit, doesn’t expect that to happen with the 2,000 doctors in his physician group, the second-largest in southeast Michigan.
“The physician-patient relationship is a very different relationship than repossessing someone’s car,” Frank said.
“It’s always been treated with reverence, so I think people are somewhat reluctant to collect from a patient, but it has become a factor of everyday business. With a group like ours, which has a good technology backstop, I expect we will be able to check patients’ insurance in real time, so I don’t believe it will be a significant problem.”
Wayne State University Physician Group, long a presence in the Detroit Medical Center, is undergoing a suburban expansion. It’s opening two floors of clinical and physician offices in June at the former Saturn headquarters in Troy, where its “back office” crew is already located, including the billing department.
Despite the extra offices, Frank believes current billing staffing will easily handle all of the new rules, so there are no plans to increase its staff.
“I don’t foresee in the short run this rule impacting us on any level,” said Frank, whose group provides more than $9 million annually in charity care.
The charity question is one that Henry Ford Health System is exploring, said Sharifa Alcendor, director of patient care management and assistance for Henry Ford. “It would actually cost us a lot less money if we just pay a person’s $125 insurance premium for them rather than foot the $125,000 care they’ve needed, so we’re busy researching and looking for guidance if its legal and appropriate to help patients” by paying their premiums when they encounter this quirk, she said.
Beaumont Health System will follow the CMS rule but remains unsure of its impact.
“We have no way of predicting how many such patients will come to Beaumont (or Beaumont doctors), and whether or not they will keep up on their premiums,” said Doug Darland, vice president, contracting and payer strategy for Beaumont. “The impact could be very small or very large, based on the types of services provided.”
Blue Cross Blue Shield of Michigan has put several programs in place to minimize the impact of this government mandate, which may be avoided by a patient if he or she pays the insurance premium on time, said Terry Burke, Blue Cross vice president for individual business.
Blue Cross extended its initial deadline for a first payment to 30 days rather than the marketplace’s 10 days and later pushed it back another 30 days, Burke said. New members received a welcome call from a new team of representatives who remind them that coverage begins when they receive payment.
Then Burke followed up with an automated telephone reminder and a letter to reinforce the message.
The results of this forethought helped Blue Cross achieve a 97 percent premium payment rate.
“We are all trying to do the right thing” in helping prevent billing surprises, Burke said.
From The Detroit News: http://www.detroitnews.com/article/20140517/BIZ/305170024#ixzz32M2CNmwC
A quirk in Obamacare has doctors throughout Michigan worried they’re going to be stuck with unpaid bills or forced to become bill collectors when treating patients.
The Affordable Care Act, in a rule published by Centers for Medicare & Medicaid Services, dictates that patients enrolled in government-subsidized health plans — individuals who have purchased a plan from the marketplace and receive a tax credit for it — have their medical bills covered by insurers for 30 days.
But during the following 60-day grace period, insurers may “pend” or hold off paying the claims and, ultimately, deny payments if the patient doesn’t catch up on his or her premiums.
That means doctors will get paid only if they collect directly from the patient long after an appointment, a move that the American Medical Association says “could pose a significant financial risk for medical practices.”
The AMA is so concerned about this rule that it’s created a step-by-step guide for its physician members to minimize their risks, and it includes a “Dear Patient” notice to mail. And some doctors have been reluctant to treat patients with plans they purchased from the marketplace — resulting in less access to health care for consumers.
“Managing risk is typically a role for insurers, but the grace period rule transfers two-thirds of that risk from the insurers to physicians and health care providers,” said AMA President Ardis Dee Hoven in a statement.
Previously, insurers generally would cancel a policy if a subscriber fell behind more than 30 days, rather than the ACA’s 90 days. The insurer, rather than the doctor, would be responsible for bills incurred before that cancellation.
With the new grace period, the burden is shifted to the doctors and their billing departments to collect money that a patient owes. Doctors’ offices are likely to to hire bill collectors if initial efforts to collect for unpaid services are unsuccessful. Doctors’ offices have financial counselors to help uninsured patients come with payment plans.
“We’ve been talking about this rule for more than a year,” said Dr. Randall Bickle, a family practitioner in Northville and the chief executive and medical director of Olympia Medical Services, a Livonia-based physicians group.
“The issue for doctors is, how aggressive are you willing to be to go after that payment and are you going to be available to send that money back if they pay the premium in full?” Bickle said, describing some of the questions that have popped up since this quirk was discovered.
The Michigan State Medical Society, which represents 15,000 doctors, has been educating its members about the rule as well, said Rebecca Black, the society’s senior director of health care delivery and education.
“Physicians are so overwhelmed right now because there are so many mandates that they are supposed to be a part of or they will start to get penalized,” Black said. “Because they have so much going on, it’s a good time to remind our membership to check insurance eligibility with every office visit.”
One of those overwhelmed is Dr. Annemarie Poleck, who practices family medicine solo in the office her father, Dr. Stanley Poleck, founded in Detroit. While her staff checks the eligibility prior to each appointment, often an insurance company fails to have the most current information, giving her a green light to treat, rather than a red.
Poleck is already seeing signs of the impact of this 90-day grace period. Recently, she referred a patient to a podiatrist for a broken ankle. Two podiatrists, leery of the patient’s marketplace health care, refused to see her unless she paid in advance for their service that she would receive in the future. A third podiatrist finally agreed without the upfront payment stipulation.
“I expect a lot of doctors will refuse to see patients in the future because they are worried about payment, and that goes against our training,” Poleck said.
Dr. Robert Frank, chief executive and chief medical officer of Wayne State University Physician Group in Detroit, doesn’t expect that to happen with the 2,000 doctors in his physician group, the second-largest in southeast Michigan.
“The physician-patient relationship is a very different relationship than repossessing someone’s car,” Frank said.
“It’s always been treated with reverence, so I think people are somewhat reluctant to collect from a patient, but it has become a factor of everyday business. With a group like ours, which has a good technology backstop, I expect we will be able to check patients’ insurance in real time, so I don’t believe it will be a significant problem.”
Wayne State University Physician Group, long a presence in the Detroit Medical Center, is undergoing a suburban expansion. It’s opening two floors of clinical and physician offices in June at the former Saturn headquarters in Troy, where its “back office” crew is already located, including the billing department.
Despite the extra offices, Frank believes current billing staffing will easily handle all of the new rules, so there are no plans to increase its staff.
“I don’t foresee in the short run this rule impacting us on any level,” said Frank, whose group provides more than $9 million annually in charity care.
The charity question is one that Henry Ford Health System is exploring, said Sharifa Alcendor, director of patient care management and assistance for Henry Ford. “It would actually cost us a lot less money if we just pay a person’s $125 insurance premium for them rather than foot the $125,000 care they’ve needed, so we’re busy researching and looking for guidance if its legal and appropriate to help patients” by paying their premiums when they encounter this quirk, she said.
Beaumont Health System will follow the CMS rule but remains unsure of its impact.
“We have no way of predicting how many such patients will come to Beaumont (or Beaumont doctors), and whether or not they will keep up on their premiums,” said Doug Darland, vice president, contracting and payer strategy for Beaumont. “The impact could be very small or very large, based on the types of services provided.”
Blue Cross Blue Shield of Michigan has put several programs in place to minimize the impact of this government mandate, which may be avoided by a patient if he or she pays the insurance premium on time, said Terry Burke, Blue Cross vice president for individual business.
Blue Cross extended its initial deadline for a first payment to 30 days rather than the marketplace’s 10 days and later pushed it back another 30 days, Burke said. New members received a welcome call from a new team of representatives who remind them that coverage begins when they receive payment.
Then Burke followed up with an automated telephone reminder and a letter to reinforce the message.
The results of this forethought helped Blue Cross achieve a 97 percent premium payment rate.
“We are all trying to do the right thing” in helping prevent billing surprises, Burke said.
From The Detroit News: http://www.detroitnews.com/article/20140517/BIZ/305170024#ixzz32M2CNmwC
25 November 2012
BCBS Overhauled
Story first appeared on freep.com.
A proposal that would end Blue Cross Blue Shield of Michigan's tax-exempt status and transform the organization from a charitable trust of the state to a customer-owned nonprofit is making headway in Lansing, but not without critics trying to step in the path of the legislation to overhaul Michigan's largest health insurer.
Competitors and advocates for consumers and the elderly — including the state attorney general — have been attempting to change or stop the legislation, which was proposed by Gov. Rick Snyder and enjoyed widespread support in the Michigan Senate. The voices for and against it now are setting their sights on the House, which is holding committee-level hearings that continue Monday and plans to bring the measures to a full and final vote by year's end.
Supporters, including the company, say the aim is to level the regulatory playing field for all health insurers. The proposed overhaul aims to modernize but not sell Blue Cross, which is governed by a separate state law from other insurers and typically waits much longer for its rate changes to be reviewed. Streamlining regulations, they say, is particularly important, as health insurers gear up for the implementation of the federal Affordable Care Act and try to meet a March deadline for getting its products and rates ready for an online health exchange where people can compare and buy their own insurance plans.
Blue Cross' special status is no accident. The insurer has been designated the state's insurer of last resort — meaning it must provide insurance coverage regardless of a customer's health status. Because of that, Blue Cross has been exempt from paying several local and state taxes. The measures proposed by Republican Gov. Rick Snyder, endorsed by Blue Cross and passed last month by the Senate, require the company to begin to pay those taxes, which Blue Cross estimates will average $100 million annually.
By transforming, Blue Cross also would shed its charitable "social mission" and contribute up to $1.5 billion to a nonprofit foundation that would carry on that work. Broadly speaking, the foundation would work to improve public health and health care access, particularly for children and the elderly. About 60% of the money is earmarked in the first four years to subsidize Medigap, which fills the gap in Medicare coverage for seniors, to prevent rates from significantly rising.
It would join 12 other Blue Cross Blue Shield companies nationwide structured as mutual insurers, which means they are owned by members. Those companies operate in 14 states.
Critics say it all doesn't add up. For starters, the contribution isn't set in stone and neither is the size of the tax bill after credits are taken into account. They fear that the social mission will be diminished because it doesn't cover the more than $300 million it contributes to social mission work.
The $1.5 billion represents half of Blue Cross' book value — the organization's assets minus liabilities. Some have been calling for a full financial valuation, saying it would provide a more accurate picture of its worth.
Michigan Attorney General Bill Schuette has opposed various parts of the legislation during the past two months and successfully lobbied to get the extended subsidies for eligible seniors, among other things, into the Senate bills. This past week, officials from his office argued for the first time publicly that the specific language creating the foundation needs to be much tighter and it should be set up so the Internal Revenue Service doesn't see it as self-dealing when Blue Cross — a major supplier of Medigap coverage — receives subsidies from the nonprofit.
Mark Cook, Blue Cross' vice president of governmental affairs, said at a hearing Tuesday that the intention of the legislation is clear to Blue Cross, which plans to make annual payments. He said the insurer is open to more language provided it's not forced to make that $1.5 billion payment at one time.
Also, he said, what some call "social assets" paid by Blue Cross in Michigan are viewed by the organization as losses. Blue Cross reported about $300 million in losses last year related to the subsidies it pays for Medigap and money it loses on individual insurance products because they tend to get the sicker folks.
Ultimately, Cook said the legislation is not what we would have proposed, but the company supports it. He said Snyder wanted to go larger and create uniformity in the insurance system, so he called for a review of the 32-year-old public act that pertains to Blue Cross, which led to the proposal he announced in September to do away with it.
Regardless, any large internal change to an insurer with 4.4 million customers representing 70% of the market is going to raise concerns and should be scrutinized.
A proposal that would end Blue Cross Blue Shield of Michigan's tax-exempt status and transform the organization from a charitable trust of the state to a customer-owned nonprofit is making headway in Lansing, but not without critics trying to step in the path of the legislation to overhaul Michigan's largest health insurer.
Competitors and advocates for consumers and the elderly — including the state attorney general — have been attempting to change or stop the legislation, which was proposed by Gov. Rick Snyder and enjoyed widespread support in the Michigan Senate. The voices for and against it now are setting their sights on the House, which is holding committee-level hearings that continue Monday and plans to bring the measures to a full and final vote by year's end.
Supporters, including the company, say the aim is to level the regulatory playing field for all health insurers. The proposed overhaul aims to modernize but not sell Blue Cross, which is governed by a separate state law from other insurers and typically waits much longer for its rate changes to be reviewed. Streamlining regulations, they say, is particularly important, as health insurers gear up for the implementation of the federal Affordable Care Act and try to meet a March deadline for getting its products and rates ready for an online health exchange where people can compare and buy their own insurance plans.
Blue Cross' special status is no accident. The insurer has been designated the state's insurer of last resort — meaning it must provide insurance coverage regardless of a customer's health status. Because of that, Blue Cross has been exempt from paying several local and state taxes. The measures proposed by Republican Gov. Rick Snyder, endorsed by Blue Cross and passed last month by the Senate, require the company to begin to pay those taxes, which Blue Cross estimates will average $100 million annually.
By transforming, Blue Cross also would shed its charitable "social mission" and contribute up to $1.5 billion to a nonprofit foundation that would carry on that work. Broadly speaking, the foundation would work to improve public health and health care access, particularly for children and the elderly. About 60% of the money is earmarked in the first four years to subsidize Medigap, which fills the gap in Medicare coverage for seniors, to prevent rates from significantly rising.
It would join 12 other Blue Cross Blue Shield companies nationwide structured as mutual insurers, which means they are owned by members. Those companies operate in 14 states.
Critics say it all doesn't add up. For starters, the contribution isn't set in stone and neither is the size of the tax bill after credits are taken into account. They fear that the social mission will be diminished because it doesn't cover the more than $300 million it contributes to social mission work.
The $1.5 billion represents half of Blue Cross' book value — the organization's assets minus liabilities. Some have been calling for a full financial valuation, saying it would provide a more accurate picture of its worth.
Michigan Attorney General Bill Schuette has opposed various parts of the legislation during the past two months and successfully lobbied to get the extended subsidies for eligible seniors, among other things, into the Senate bills. This past week, officials from his office argued for the first time publicly that the specific language creating the foundation needs to be much tighter and it should be set up so the Internal Revenue Service doesn't see it as self-dealing when Blue Cross — a major supplier of Medigap coverage — receives subsidies from the nonprofit.
Mark Cook, Blue Cross' vice president of governmental affairs, said at a hearing Tuesday that the intention of the legislation is clear to Blue Cross, which plans to make annual payments. He said the insurer is open to more language provided it's not forced to make that $1.5 billion payment at one time.
Also, he said, what some call "social assets" paid by Blue Cross in Michigan are viewed by the organization as losses. Blue Cross reported about $300 million in losses last year related to the subsidies it pays for Medigap and money it loses on individual insurance products because they tend to get the sicker folks.
Ultimately, Cook said the legislation is not what we would have proposed, but the company supports it. He said Snyder wanted to go larger and create uniformity in the insurance system, so he called for a review of the 32-year-old public act that pertains to Blue Cross, which led to the proposal he announced in September to do away with it.
Regardless, any large internal change to an insurer with 4.4 million customers representing 70% of the market is going to raise concerns and should be scrutinized.
27 March 2012
Massachusetts Law Didn't Hurt Businesses After All
Story first appeared in the Detroit Free Press.
Massachusetts was a forerunner to the federal government's health care overhaul, adopting comprehensive changes that took effect in 2007, three years before the Affordable Care Act.
The state law did not hurt businesses as many feared, according to a recent report from the state. It is conducted annually by the Blue Cross Blue Shield of Massachusetts Foundation.
Some highlights:
* Employers keep coverage: Some 91% of Massachusetts workers are employed by firms with health coverage, a figure that has held steady since 2006.
* Workers like their health plans: More than seven of every 10 workers rated their health plans as very good or excellent, and rated both the quality of their care and satisfaction with it higher than in pre-revision years.
* Small businesses are not hurt by public plans: Employer-sponsored coverage remains steady at small businesses, with more than 70% retaining coverage for employees between 2006 and 2010.
* Premiums are rising: Monthly insurance premiums for people with workplace coverage continue to rise in Massachusetts at rates higher than those nationwide. That's partly because the state did not have as many cost-savings programs as the new federal law requires, according to health policy experts. Federal health officials hope to achieve many savings by restructuring the federal Medicare program into a high-quality, cost-saving plan, an option Massachusetts does not have.
By 2009, the average annual employee contribution to premiums for Massachusetts plans was $1,321 for an individual and $4,088 for a family, compared with $957 for a single person and $3,474 for a family nationwide, according to the foundation's report.
Out-of-pocket costs also have risen in Massachusetts, with 3% to 4% of workers enrolled in high-deductibles plans in 2011, compared with 1% in 2006.
Overall it's hard to determine how much of the increases are because of Massachusetts state law alone, or whether it is part of a larger national trend toward growing out-of-pocket costs for consumers and workers.
Massachusetts was a forerunner to the federal government's health care overhaul, adopting comprehensive changes that took effect in 2007, three years before the Affordable Care Act.
The state law did not hurt businesses as many feared, according to a recent report from the state. It is conducted annually by the Blue Cross Blue Shield of Massachusetts Foundation.
Some highlights:
* Employers keep coverage: Some 91% of Massachusetts workers are employed by firms with health coverage, a figure that has held steady since 2006.
* Workers like their health plans: More than seven of every 10 workers rated their health plans as very good or excellent, and rated both the quality of their care and satisfaction with it higher than in pre-revision years.
* Small businesses are not hurt by public plans: Employer-sponsored coverage remains steady at small businesses, with more than 70% retaining coverage for employees between 2006 and 2010.
* Premiums are rising: Monthly insurance premiums for people with workplace coverage continue to rise in Massachusetts at rates higher than those nationwide. That's partly because the state did not have as many cost-savings programs as the new federal law requires, according to health policy experts. Federal health officials hope to achieve many savings by restructuring the federal Medicare program into a high-quality, cost-saving plan, an option Massachusetts does not have.
By 2009, the average annual employee contribution to premiums for Massachusetts plans was $1,321 for an individual and $4,088 for a family, compared with $957 for a single person and $3,474 for a family nationwide, according to the foundation's report.
Out-of-pocket costs also have risen in Massachusetts, with 3% to 4% of workers enrolled in high-deductibles plans in 2011, compared with 1% in 2006.
Overall it's hard to determine how much of the increases are because of Massachusetts state law alone, or whether it is part of a larger national trend toward growing out-of-pocket costs for consumers and workers.
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